AMERICAN RETIREMENT CORPORATION RESTRICTED STOCK AGREEMENT
Exhibit
10.3
AMERICAN
RETIREMENT CORPORATION
This
RESTRICTED STOCK AGREEMENT (the "Agreement") is by and between American
Retirement Corporation, a Tennessee corporation (the "Company"), and
________________ (the "Grantee").
Section
1. Restricted
Stock Award.
The
Grantee is hereby granted the right to receive ________ shares (the "Restricted
Stock") of the Company's common stock, par value $0.01 per share (the "Common
Stock"), subject to the terms and conditions of this Agreement and the American
Retirement Corporation 1997 Stock Incentive Plan (as amended, the "Plan").
Capitalized terms used but not otherwise defined herein shall have the meanings
ascribed thereto in the Plan.
Section
2. Vesting
of the Award.
The
shares of Restricted Stock granted pursuant to Section
1
hereof
shall vest at such times (each, a "Vesting Date") and in the percentages
set
forth below, if and only if the Grantee is continuously employed by the Company
(or any Subsidiary or Affiliate of the Company) from the date hereof through
such Vesting Date (except as set forth in Section
5(b)
hereof):
|
Vesting
Date
|
Percentage
of
Restricted
Stock Vesting
|
|
|
___________
__, 200_
|
33.3%
|
|
|
___________
__, 200_
|
33.3%
|
|
|
___________
__, 200_
|
33.4%
|
|
Section
3. Distribution
of Restricted Stock.
Certificates representing the Restricted Stock will be distributed to the
Grantee as soon as practicable after the Vesting Date. Notwithstanding the
foregoing, if the Grantee's employment with the Company (or any Subsidiary
or
Affiliate of the Company) is terminated under the circumstances set forth
in
Section
5(b),
certificates representing the Restricted Stock awarded hereunder will be
distributed to the Grantee (or the Grantee's estate or legal representative)
as
soon as practicable after the Grantee's termination. The
Certificates representing the Restricted Stock shall be subject to the
restrictions on transfer set forth in Section
6
hereof.
Section
4. Voting
Rights and Dividends.
Prior
to the distribution of the Restricted Stock, certificates representing shares
of
Restricted Stock will be held by the Company (the "Custodian") in the name
of
the Grantee. The Custodian will take such action as is necessary and appropriate
to enable the Grantee to vote the Restricted Stock. All cash dividends received
by the Custodian, if any, with respect to the Restricted Stock will be remitted
to the Grantee. Notwithstanding the foregoing, no voting rights or dividend
rights shall inure to the Grantee following the forfeiture of the Restricted
Stock pursuant to Section
5(a).
Section
5. Termination.
(a) In
the
event that Grantee's employment by the Company (or any Subsidiary or Affiliate
of the Company) terminates for any reason (other than by reason of death
or
Disability), all shares of Restricted Stock that have not vested prior to
the
date of termination shall be immediately forfeited and Grantee shall have
no
further rights with respect to such shares of Restricted Stock.
(b) If
the
Grantee dies while employed by the Company (or any Subsidiary or Affiliate
of
the Company) or if the Grantee's employment is terminated by reason of
Disability, all unvested shares of Restricted Stock shall be deemed vested
as of
the date of such death or Disability.
Section
6. No
Transfer or Pledge of Restricted Stock.
No
shares of Restricted Stock may be Transferred (as hereinafter defined) prior
to
the Vesting Date. Thereafter, the Grantee may not Transfer more than twenty-five
percent (25%) of all of the Grantee’s vested Restricted Stock in any calendar
quarter. In
addition, any Transfer of vested Restricted Stock shall be subject to the
Company's determination that, after giving effect to such Transfer, the Grantee
will remain in compliance with the provisions of any stock ownership policy
applicable to the Grantee that is then in existence. As used herein, the
term
"Transfer" shall mean any transfer, sale, conveyance, pledge, encumbrance,
hypothecation or disposition of any kind, whether voluntary or
involuntary.
Section
7. Tax
Election.
The
Grantee may, but is not required to, elect to apply the tax rules of Section
83(b) of the Internal Revenue Code of 1986, as amended (the "Code"), to the
issuance of the Restricted Stock. If the Grantee makes an affirmative election
under Section 83(b) of the Code, the Grantee shall deliver a copy of such
election to the Company in accordance with the requirements of the Code and
the
Regulations promulgated thereunder. The Grantee acknowledges that the decision
to make, or refrain from making, an election to apply Section 83(b) of the
Code
is his individual decision, based upon the Grantee's personal analysis and
personal tax advice. The Grantee acknowledges that the Company has not attempted
to influence the Grantee, or provided the Grantee with any advice, in connection
with the Grantee’s determination of whether to make an election to apply Section
83(b) of the Code. The Grantee is urged to consult with his individual tax
advisors in making the determinations described in this section.
Section
8. Tax
Withholding.
The
Company may withhold from any distribution of Restricted Stock an amount
of
Common Stock equal to such federal, state or local taxes as shall be required
to
be withheld pursuant to any applicable law or regulation, unless the Company
agrees to accept a payment of cash (or to withhold from other wages payable
to
Grantee) in the amount of such withholding taxes.
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Section
9. Change
of Control.
Upon
the occurrence of a Change in Control or a Potential Change in Control as
defined in Section
10
of the
Plan, all Restricted Stock shall be deemed vested and the restrictions under
the
Plan and this Agreement with respect to the Restricted Stock, including the
restriction on transfer set forth in Section
6
hereof,
shall automatically expire and shall be of no further force or
effect.
Section
10. Stock
Subject to Award.
In the
event that the shares of Common Stock of the Company should, as a result
of a
stock split or stock dividend or combination of shares or any other change,
redesignation, merger, consolidation, recapitalization or otherwise, be
increased or decreased or changed into or exchanged for a different number
or
kind of shares of stock or other securities of the Company or of another
corporation, the number of shares of Restricted Stock that have been awarded
to
Grantee shall be appropriately adjusted to reflect such action. If any such
adjustment shall result in a fractional share, such fraction shall be
disregarded.
Section
11. Stock
Power.
Concurrently with the execution of this Agreement, the Grantee shall deliver
to
the Company a stock power, endorsed in blank, relating to the shares of
Restricted Stock. Such stock power shall be in a form satisfactory to the
Company.
Section
12. Legend.
Each
certificate representing Restricted Stock shall bear a legend in substantially
the following form:
THIS
CERTIFICATE AND THE SHARES OF STOCK REPRESENTED HEREBY ARE SUBJECT TO THE
TERMS
AND CONDITIONS (INCLUDING FORFEITURE AND RESTRICTIONS AGAINST TRANSFER)
CONTAINED IN THE AMERICAN RETIREMENT CORPORATION 1997 STOCK INCENTIVE PLAN
(AS
AMENDED, THE "PLAN") AND THE RESTRICTED STOCK AGREEMENT (THE "AGREEMENT")
BETWEEN THE OWNER OF THE RESTRICTED STOCK REPRESENTED HEREBY AND AMERICAN
RETIREMENT CORPORATION (THE "COMPANY"). THE RELEASE OF SUCH STOCK FROM SUCH
TERMS AND CONDITIONS SHALL BE MADE ONLY IN ACCORDANCE WITH THE PROVISIONS
OF THE
PLAN AND THE AGREEMENT, COPIES OF WHICH ARE ON FILE AT THE COMPANY.
Section
13. Restrictive
Agreement.
As a
condition to the distribution of any vested shares of Restricted Stock, the
Grantee (or his legal representative or estate or any third party transferee),
if the Company so requests, will execute an agreement in form satisfactory
to
the Company in which the Grantee or such other recipient of the shares
represents that he is acquiring the shares without a view to distribution
thereof.
Section
14. No
Right to Continued Employment.
This
Agreement shall not be construed as giving the Grantee the right to be retained
in the employ of the Company (or any Subsidiary or Affiliate of the Company),
and the Company (or any Subsidiary or Affiliate of the Company) may at any
time
dismiss the Grantee from employment, free from any liability or any claim
under
the Plan.
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Section
15. Governing
Provisions.
This
Agreement is made under and subject to the provisions of the Plan, and all
of
the provisions of the Plan are also provisions of this Agreement. If there
is a
difference or conflict between the provisions of this Agreement and the
provisions of the Plan, the provisions of the Plan will govern. By signing
this
Agreement, the Grantee confirms that he or she has received a copy of the
Plan.
Section
16. Miscellaneous.
16.1
Entire
Agreement.
This
Agreement and the Plan contain the entire understanding and agreement between
the Company and the Grantee concerning the Restricted Stock granted hereby,
and
supersede any prior or contemporaneous negotiations and understandings. The
Company and the Grantee have made no promises, agreements, conditions, or
understandings relating to the Restricted Stock, either orally or in writing,
that are not included in this Agreement or the Plan.
16.2
Captions.
The
captions and section numbers appearing in this Agreement are inserted only
as a
matter of convenience. They do not define, limit, construe, or describe the
scope or intent of the provisions of this Agreement.
16.3
Counterparts.
This
Agreement may be executed in counterparts, each of which when signed by the
Company and the Grantee will be deemed an original and all of which together
will be deemed the same Agreement.
16.4
Notice.
Any
notice or communication having to do with this Agreement must be given by
personal delivery or by certified mail, return receipt requested, addressed,
if
to the Company, to the principal office of the Company, and, if to the Grantee,
to the Grantee's last known address provided by the Grantee to the
Company.
16.5
Amendment.
This
Agreement may be amended by the Company, provided that unless the Grantee
consents in writing, the Company cannot amend this Agreement if the amendment
will materially change or impair the Grantee's rights under this Agreement
and
such change is not to the Grantee's benefit.
16.6
Successors
and Assignment.
Each
and all of the provisions of this Agreement are binding upon and inure to
the
benefit of the Company and the Grantee and their heirs, successors, and assigns.
However, the Grantee may not Transfer this Agreement or the Grantee's rights
hereunder. Furthermore, the Grantee may Transfer the Restricted Stock
distributed to the Grantee pursuant to this Agreement only as set forth in
this
Agreement.
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16.7
Governing
Law.
This
Agreement shall be governed and construed exclusively in accordance with
the
laws of the State of Tennessee applicable to agreements to be performed in
the
State of Tennessee.
[Signature
page to follow.]
5
IN
WITNESS WHEREOF, the Company and the Grantee have executed this Agreement
to be
effective as of _____________, __ 20__.
| AMERICAN RETIREMENT CORPORATION | ||
| By: | ||
| Name: | ||
| Title: | ||
| Grantee: | ||
| Name: | ||
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