We present the observational results of an L and M band Adaptive Optics (AO) imaging survey of 54 nearby, sunlike stars for extrasolar planets, carried out using the Clio camera on the MMT. We have concentrated more strongly than all other planet imaging surveys to date on very nearby F, G, and K stars, prioritizing stellar proximity higher than youth. Ours is also the first survey to include extensive observations in the M band, which supplement the primary L observations. Models predict much better planet/star flux ratios at the L and M bands than at more commonly used shorter wavelengths (i.e. the H band). We have carried out extensive blind simulations with fake planets inserted into the raw data to verify our sensitivity, and to establish a definitive relationship between source significance in $sigma$ and survey completeness. We find 97% confident-detection completeness for 10$sigma$ sources, but only 46% for 7$sigma$ sources -- raising concerns about the standard procedure of assuming high completeness at 5$sigma$, and demonstrating that blind sensitivity tests to establish the significance-completeness relation are an important analysis step for all planet-imaging surveys. We discovered a previously unknown, approximately 0.15 solar-mass stellar companion to the F9 star GJ 3876, at a projected separation of about 80 AU. Twelve additional candidate faint companions are detected around other stars. Of these, eleven are confirmed to be background stars, and one is a previously known brown dwarf. We obtained sensitivity to planetary-mass objects around almost all of our target stars, with sensitivity to objects below 3 Jupiter masses in the best cases. Constraints on planet populations based on this null result are presented in our Modeling Results paper.
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