Exhibit 10.62
AMENDMENT NO. 4 TO THE
ADVOCAT INC.
1994 INCENTIVE AND NONQUALIFIED STOCK OPTION PLAN
FOR KEY PERSONNEL
     Amendment No. 4 to the Advocat Inc. (the “Corporation”) 1994 Incentive and
Nonqualified Stock Option Plan for Key Personnel authorizes the Committee to
permit an Option holder to pay the Option price by using the “net exercise”
method. Capitalized terms used in the Amendment No. 4, if not otherwise defined
herein, shall have the respective meanings attributed to such terms in the Plan.
     The 1994 Incentive and Nonqualified Stock Option Plan for Key Personnel is
hereby amended by striking Subparagraph 7(e) in its entirety and inserting the
following in lieu thereof:
     (e) Payment and Withholding.
     (i) Payment for all shares purchased pursuant to exercise of an Option will
be made in cash, by delivery of unrestricted shares of Common Stock at Fair
Market Value on the date of exercise, or a combination thereof. The payment will
be made at the time the Option or any part thereof is exercised, and no shares
will be issued until full payment therefor has been made. Payment in currency or
by check, bank draft, cashier’s check or postal money order will be considered
payment in cash.
     (ii) Notwithstanding the subparagraph 7(e)(i), the Committee may in its
discretion permit the Option price to be paid by the “net exercise” of such
Option In such case, the Company will not require a cash payment of the Option
price, but will reduce the number of shares of Common Stock issued upon the
exercise of such Option by the largest number of whole shares of Common Stock
that have a Fair Market Value which does not exceed the aggregate Option price
with respect to the portion of such Option that is being exercised. With respect
to any remaining balance of the aggregate Option price, the Company shall accept
a cash payment. Upon the “net exercise” of an Option (A) shares used to pay the
Option price, (B) shares actually delivered to the Option holder as a result of
such exercise, and (C) shares withheld for purposes of tax withholding, will no
longer be outstanding under such Option (and will therefore no longer be
exercisable by the holder).
     (iii) In addition to the Option price, the Corporation will have the right,
if applicable, to require the holder of an Option to remit to the Corporation an
amount sufficient to satisfy any federal, state or local withholding tax
liability prior to the delivery of any certificate or certificates for shares
issuable upon exercise of the Option.

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