UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
November 21, 2005 (November 15, 2005)
Date of report (Date of earliest event reported):
AMERICAN RETIREMENT CORPORATION
- --------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in Charter)
Tennessee 01-13031 62-1674303
- ---------------------------- --------------- -----------------------
(State or Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.)
111 Westwood Place, Suite 200
Brentwood, Tennessee 37027
- ------------------------------------------------- ------------------------
(Address of Principal Executive Offices) (Zip Code)
(615) 221-2250
- --------------------------------------------------------------------------------
(Registrant's Telephone Number, Including Area Code)
Not Applicable
- --------------------------------------------------------------------------------
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 1.01. Entry into a Material Definitive Agreement
Item 1.02. Termination of a Material Definitive Agreement
On November 15, 2005, the Compensation Committee of our Board of Directors
adopted the American Retirement Corporation Officer's Incentive Compensation
Plan. The plan, which will become effective as of January 1, 2006, will
supercede our current Officer's Incentive Compensation Plan (although officers
will be eligible to receive payment of awards earned under the current plan for
the fiscal year ending December 31, 2005). The plan is intended to serve as our
annual cash bonus plan for executive and other officers. The plan has three
components (Part A, Part B and Part C), which provide for the payment of bonuses
based upon each officer's satisfaction of individual performance objectives and
the company's achievement of designated financial and operating targets. The
Compensation Committee will periodically establish the quarterly and annual
financial and operational targets for the company under the plan.
Under Part A of the plan, officers receive bonuses based upon the extent to
which they satisfy their personal performance objectives. Under Part B of the
plan, bonuses are dependent not only upon the satisfaction of personal
performance objectives, but also upon the company's achievement of quarterly
financial and operating targets. Under Part C of the plan, bonuses are based
only upon the company's achievement of annual financial and operating targets.
The maximum potential bonuses payable to a participant in the plan (as a
percentage of the participant's total earnings attributable to base salary for
the respective quarterly or annual period) are set forth in the following table:
Incentive Pay Components
- -------------------------------------------------------------------------------------------------------------------
Individual Company Annual
Officer Title TOTAL ANNUAL Quarterly Quarterly Company
POTENTIAL Performance Performance Performance
Opportunity Opportunity Opportunity
Part A Part B Part C
- ------------------------------------ ------------------- -------------------- ------------------ ------------------
Vice President 60% 20% 30% 10%
- ------------------------------------ ------------------- -------------------- ------------------ ------------------
Senior Vice President 80% 20% 30% 30%
- ------------------------------------ ------------------- -------------------- ------------------ ------------------
Executive Vice President 100% 20% 20% 60%
- ------------------------------------ ------------------- -------------------- ------------------ ------------------
Chief Financial Officer 120% 20% 20% 80%
Chief Operating Officer
Chief Executive Officer
- -------------------------------------------------------------------------------------------------------------------
The company will accrue for bonuses under the plan as they are earned.
Bonuses will be paid to officers no later than April 15 of the following year
for amounts earned under the plan for the previous year.
2
On November 15, 2005, the Compensation Committee of our Board of Directors
also approved changes to the compensation of the non-employee members of our
Board of Directors. Pursuant to the Compensation Committee's action, effective
as of January 1, 2006, each non-employee member of the Board of Directors will
receive an annual cash retainer of $34,000, to be paid in quarterly
installments. Each non-employee member of the Board of Directors will also be
entitled to receive an annual cash retainer for service on each committee of the
Board of Directors. Those members serving on the Executive Committee or Audit
Committee will receive an annual committee retainer of $12,000. Those members
serving on the Compensation Committee, Nominating and Corporate Governance
Committee or Quality Assurance Committee will receive an annual committee
retainer of $6,000. The chairs of the Executive Committee and Audit Committee
will receive an additional annual cash retainer of $6,000 and the chairs of the
Compensation Committee, Nominating and Corporate Governance Committee and
Quality Assurance Committee will receive an additional annual cash retainer of
$3,000. Effective as of January 1, 2006, members of the Board of Directors will
no longer be entitled to receive fees for attending or participating
telephonically in board and committee meetings.
Item 5.02. Departure of Directors or Principal Officers; Election of
Directors; Appointment of Principal Officers
In order to fill the vacancy created by the April 2005 resignation of
Christopher J. Coates, on November 15, 2005, our Board of Directors elected
James R. Seward as a Class I director to serve until the 2006 annual meeting of
shareholders and until his successor is duly elected and qualified.
Mr. Seward has not been appointed to any committee of the Board as of the
date of this Current Report on Form 8-K.
Item 7.01. Regulation FD Disclosure
On November 21, 2005, we issued a press release announcing the appointment
of James R. Seward to our Board of Directors. A copy of the press release is
furnished herewith as Exhibit 99.1.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits.
99.1 Press Release dated November 21, 2005
3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
AMERICAN RETIREMENT CORPORATION
By: /s/ Bryan D. Richardson
--------------------------------------
Bryan D. Richardson
Executive Vice President - Finance and
Chief Financial Officer
Date: November 21, 2005
4
EXHIBIT INDEX
Exhibit
Number Description
------ -----------
99.1 Press Release dated November 21, 2005
5