Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
(a) Effective at the close of business on May 26, 2009, Ted P. Stokely resigned as a director of and as Chairman of the Board of American Realty Investors, Inc. (the "Company," or the "Issuer," or the "Registrant"). Mr. Stokely had been a director of the Company since November 2002 and Chairman of the Board of the Company since November 2002. At the time of his resignation as a director and Chairman of the Board, Mr. Stokely had no disagreement with the Registrant on any matter relating to the Registrant's operations, policies or practices.
(b) On May 28, 2009, the Board of Directors of the Company elected Henry A. Butler as Chairman of the Board of Directors to fill the vacancy created by the resignation of Ted P. Stokely from such position. The Chairman of the Board of Directors of the Company is not deemed to be the principal executive officer of the Company, is a non-salaried position compensated only by additional directors fees. Each non-employee director receives an annual retainer from the Company plus reimbursement for expenses. The Chairman of the Board receives an additional fee per year. Mr. Butler, age 58, has been a member of the Board of Directors since July 2003. Mr. Butler is a broker/land sales (since July 2003) for Prime Income Asset Management LLC. Mr. Butler has also been a director of Transcontinental Realty Investors, Inc. since December 2001.

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