EXHIBIT 10.7

                              FIRST AMENDMENT TO
                            ATRIA COMMUNITIES, INC.
               NON-EMPLOYEE DIRECTORS 1996 STOCK INCENTIVE PLAN
               ------------------------------------------------


     A.   Atria Communities, Inc., a Delaware corporation ("Company"), adopted
the Atria Communities, Inc. Non-Employee Directors 1996 Stock Incentive Plan
("Plan") on June 13, 1996, and the Plan was approved by the sole stockholder of
the Company on June 14, 1996.

     B.   The Company desires to grant non-employee directors options to
purchase an increased number of shares.

     C.   The Company desires to increase the number of shares available for
issuance pursuant to the Plan.


     NOW, THEREFORE, the Plan is hereby amended as follows:


  1. AMENDMENT OF PLAN.

     (a) Section 3.3 of the Plan is hereby deleted and the following substituted
         in its place:

             "3.3 Additional Option Grants. On July 18, 1997, and each
             anniversary of that date hereafter, each Non-Employee Director,
             other than the Chairman of the Board of the Company, shall
             automatically be granted an Option to purchase 5,000 Shares, and
             the Chairman of the Board of the Company shall be automatically
             granted an Option to purchase 10,000 Shares, provided that (i) such
             Non-Employee Director shall have continually served as a director
             of the Company for the nine-month period prior to the date of the
             Option grant and (ii) the number of Shares available for grant
             under the Plan is sufficient to permit such automatic grant."

     (b) Article 4 of the Plan is hereby amended by deleting the number
"250,000" and substituting therefor the number "350,000".

  2. CONTINUATION OF BALANCE OF PLAN.  Except as amended hereby, the Plan is
unchanged and remains in full force and effect.

  3. GOVERNING LAW.  This Amendment shall be governed by, and construed in
accordance with, the laws of the State of Delaware without regard to its
conflict of laws rules.

 
  IN WITNESS WHEREOF, this Amendment has been adopted by the Company as of the
16th day of July, 1997.


                                        ATRIA COMMUNITIES, INC.     
 

                                        By: /s/ W. PATRICK MULLOY, II
                                           ------------------------------------
                                        Title: Chief Executive Officer
                                              ---------------------------------

                                      -2-