ARTICLES OF AMENDMENT TO
                    ARTICLES OF INCORPORATION
                                OF
                 RETIREMENT CARE ASSOCIATES, INC.
              (SERIES E CONVERTIBLE PREFERRED STOCK)

     Pursuant to the requirements of Section 7-106-102 of the Colorado
Business Corporation Act, the undersigned Corporation submits the following
Articles of Amendment to Articles of Incorporation.

     FIRST:  The name of the Corporation is Retirement Care Associates, Inc.

     SECOND:  The Articles of Incorporation of the Corporation are hereby
amended as follows:

     "There is hereby established a series of Preferred Stock of the
Corporation designated "Series E Convertible Preferred Stock."  The number of
shares of this series of Convertible Preferred Stock shall be 1,000,000
shares.  The powers, designations, preferences and relative, participating,
optional or other special rights of the shares of this series of Convertible
Preferred Stock and the qualifications, limitations and restrictions of such
preferences and rights shall be as follows:

     Section 1.     CONVERSION RIGHTS.

          a.   RIGHT TO CONVERT.  Each share of Series E Convertible
Preferred Stock may be converted at the option of the holder thereof at the
times set forth herein, and without the payment of any additional
consideration thereof, into the number of fully paid, nonassessable shares of
common stock $.0001 par value, of the Corporation (the "Common Stock")
determined by taking the price paid per share of Series E Convertible
Preferred Stock and dividing it by the Conversion Price as determined as
follows: the Conversion Price shall be the lesser of (a) 110% of the average
closing price as reported by  the New York Stock Exchange of the Company's
Common Stock (the "Closing Price") for the five (5) trading days immediately
prior to the Original Issuance Date or (b) 85% of the average of the Closing
Price for the five (5) trading days immediately preceding the Date of
Conversion, as defined below in Section 1(c) herein; but in no event will the
Conversion Price be less than $5.00.

          b.   CONVERSION PERIODS.  Each holder of Series E Convertible
Preferred Stock shall have the option to convert one-half (1/2) of his shares
at any time from and after the forty-fifth (45th) day following the date of
issuance and one-half (1/2) of his shares at any time from and after the
seventy-fifth (75th) day following the date of issuance.

          c.   AUTOMATIC CONVERSION.  Each share of Series E Convertible
Preferred Stock not previously converted at the election of the holder thereof
shall automatically be converted into shares of Common Stock at the then
effective Conversion Price on the date which is two (2) years after the date
such shares of Series E Convertible Preferred Stock were issued by the
Corporation.

          d.   ADDITIONAL SHARES OR CASH.  Upon the conversion of shares of
Series E Convertible Preferred Stock under the terms of Section 1a. through c.
above, the holder of the shares of Series E Convertible Preferred Stock
converted shall also receive additional shares of Common Stock as determined
by the following calculation for each share of Series E Convertible Preferred
Stock that is converted:

                         (.08)(N/365)(P) 
                               -----------------
                         Conversion Price
where,

     N    =    The number of days between the original date of issuance of
               the Series E Convertible Preferred Stock (the "Original
               Issuance Date") and the applicable date of conversion, and

     P    =    Price paid per share of Series E Convertible Preferred
Stock.

PROVIDED, HOWEVER, that in lieu of issuing all or a portion of the additional
shares of Common Stock to which a holder of Series E Convertible Preferred
Stock is entitled, the Corporation may, in the sole discretion of the Board of
Directors, pay to such holder an amount in cash equal to the Conversion Price
of such additional shares; and PROVIDED FURTHER that the Corporation shall be
required to pay such amount in cash in lieu of additional shares of Common
Stock if it is necessary to do so in order to prevent the total number of
shares of Common Stock to be issued upon the conversion of all of the shares
of the Series E Convertible Preferred Stock from exceeding 2,200,000 (which
number shall be adjusted in accordance with Section 2b. hereof).

          e.   MECHANICS OF CONVERSION.  No fractional shares of Common
Stock shall be issued upon conversion of Series E Convertible Preferred Stock. 
In lieu of any fractional share to which the holder would otherwise be
entitled, the Corporation shall round up to the nearest whole share.  In the
case of a dispute as to the calculation of the Conversion Rate, the
Corporations calculations shall be deemed conclusive absent manifest error. 
In order to convert Series E Convertible Preferred Stock into full shares of
Common Stock, the holder shall surrender the certificate or certificates
thereof, duly endorsed, either by overnight courier or 2-day courier, to the
office of the Corporation or of any transfer agent for the Series E
Convertible Preferred Stock, and shall give written notice to the Corporation
at such office that the holder elects to convert the same, the number of
shares of Series E Convertible Preferred Stock so converted and a calculation
of the Conversion Rate (with an advance copy of the certificate(s) and the
notice by facsimile); provided, however, that the Corporation shall not be
obligated to issue certificates evidencing shares of Common Stock issuable
upon such conversion unless certificates evidencing such shares of Series E
Convertible Preferred Stock are delivered to the Corporation or its transfer
agent as provided above, or the holder notifies the Corporation or its
transfer agent that such certificates have been lost, stolen or destroyed and
executes an agreement satisfactory to the Corporation to indemnify the
Corporation from any loss incurred by it in connection with such certificates.

          The Corporation shall use its best efforts to issue and deliver
within three (3) business days after delivery to the Corporation of such
Series E Convertible Preferred Stock certificates, or after such agreement and
indemnification, to such holder of Series E Convertible Preferred Stock at the
address of the holder on the stock books of the Corporation, a certificate or
certificates for the number of shares of Common Stock to which the holder
shall be entitled as aforesaid. The date on which notice of conversion is
given (the "Date of Conversion") shall be deemed to be the date set forth in
such notice of conversion provided the original shares of Series E Convertible
Preferred Stock to be converted are received by the Corporation of the
transfer agent, as the case may be,  within three (3) business days thereafter
and the person or person entitled to receive the shares of Common Stock
issuable upon such conversion shall be treated for all purposes as the record
holder or holders of such shares of Common Stock on such date.  If the
original shares of  Series E Convertible Preferred Stock to be converted are
not received by the transfer agent within three (3) business days after the
Date of Conversion, the notice of conversion shall become null and void.

     Section 2.     CORPORATE EVENTS.
     
          a.   NOTICES OF RECORD DATE.  In the event of (i) any declaration
by the Corporation of a record date of the holders of any class of securities
for the purpose of determining the holders thereof who are entitled to receive
any dividend or other distribution or (ii) any capital reorganization of the
Corporation, any reclassification or recapitalization of the capital stock of
the Corporation, any merger or consolidation of the Corporation and any other
entity or person, or any voluntary or involuntary dissolution, liquidation or
winding up of the Corporation, the Corporation shall mail to each holder of
Series E Convertible Preferred Stock at least 20 days prior to the record date
specified herein, a notice specifying (A) the date on which any such record
date is to be declared for the purpose of such dividend or distribution and a
description of such dividend or distribution, (B) the date on which any such
reorganization, reclassification, transfer, consolidation, merger,
dissolution, liquidation or winding up is expected to become effective, and
(C) the time, if any, that is to be fixed, as to when the holders of record of
Common Stock (or other securities) become eligible to receive securities or
other property deliverable upon such reorganization, reclassification,
transfer, consolidation, merger, dissolution or winding up.

          b.   CORPORATE CHANGES.  The Closing Price used to determine the
Conversion Price shall be appropriately adjusted to reflect, as deemed
equitable and appropriate by the Corporation, any stock dividend, stock split
or share combination of the Common Stock.  In the event of a merger,
reorganization, recapitalization or similar event of or with respect to the
Corporation (a "Corporate Change") (other than a Corporation Change in which
all or substantially all of the consideration received by the holders of the
Company's equity securities upon such Corporate Change consists of cash or
assets other than securities issued by the acquiring entity or any affiliate
thereof), the Series E Convertible Preferred Stock shall be assumed by the
acquiring entity and thereafter the Series E Convertible Preferred Stock shall
be convertible into such class and type of securities as the holder would have
received had the holder converted the Series E Convertible Preferred Stock
immediately prior to such Corporate Change, as appropriately adjusted to
equitably reflect the Conversion Price and any stock dividend, stock split or
share combination of the Common Stock after such corporate event.

     Section 3.     RESERVATION OF STOCK ISSUABLE UPON CONVERSION.  The
Corporation shall at all times reserve and keep available out of its
authorized but unissued shares of Common Stock solely for the purpose of
effecting the conversion of the shares of Series E Convertible Preferred
Stock, such number of its shares of Common Stock as shall from time to time be
sufficient to effect the conversion of all then outstanding shares of Series E
Convertible Preferred Stock; and if at any time the number of authorized but
unissued shares of Common Stock shall not be sufficient to affect the
conversion of all then outstanding shares of the Series E Convertible
Preferred Stock, the Corporation will take such corporate action as may be
necessary to increase its authorized but unissued shares of Common Stock to
such number of shares as shall be sufficient for such purpose.

     Section 4.     LIQUIDATION PREFERENCE.

          a.   In the event of any liquidation, dissolution or winding up
of the Corporation, either voluntary or involuntary, the holders of shares of
Series E Convertible Preferred Stock shall be entitled to receive, immediately
after distributions of senior securities required by the Corporation's
Articles of Incorporation, and prior and in preference to any distribution to
junior securities but in parity with any distribution to parity securities, an
amount per share equal to the sum of (i) $10.00 (the "Original Convertible
Issue Price") and (ii) an amount equal to 4% of the Original Convertible Issue
Price per annum for the period that has passed since the date of issuance of
any Series E Convertible Preferred Stock (such amount being referred to herein
as the "Premium").  If upon the occurrence of such event the assets and funds
thus distributed among the holders of the Series E Convertible Preferred Stock
and parity securities shall be insufficient to permit the payment to such
holders of the full preferential amounts due to the holders of the Series E
Convertible Preferred Stock and the parity securities, respectively, then the
entire assets and funds of the Corporation legally available for distribution
shall be distributed among the holders of the Series E Convertible Preferred
Stock and the parity securities,  pro rata, based on the respective
liquidation amounts to which such series of stock is entitled by the
Corporation's Articles of Incorporation.

          b.   Upon the completion of the distribution required by
subsection 5(a), if assets remain in this Corporation, they shall be
distributed to holders of parity securities (unless holders of parity
securities have received distributions pursuant to subsection 5(a) above) and
junior securities in accordance with the Corporation's Articles of
Incorporation.

          c.   A consolidation or merger of the Corporation with or into
any other corporation or corporations, or a sale, conveyance or distribution
of all or substantially all of the assets of the Corporation or the
effectuation by the Corporation of a transaction or series of related
transactions in which more than 50% of the voting power of the Corporation is
disposed of, shall not be deemed to be a liquidation, dissolution or winding
up within the meaning of this Section 5, but shall instead be treated pursuant
to Section 3 hereof.

     Section 5.     VOTING RIGHTS.  The holders of Series E Convertible
Preferred Stock will not have any voting rights except as set forth below or
as otherwise from time to time required by law.  The affirmative vote or
consent of the holders of at least a majority of the outstanding shares of
Series E Convertible Preferred Stock, voting separately as a class, will be
required for an amendment, alteration or repeal of the Corporation's Articles
of Incorporation if, and only if, the amendment, alteration or repeal
adversely affects the powers, preferences or special rights of the Series E
Convertible Preferred Stock.

     To the extent that under Colorado law the vote of the holders of the
Series E Convertible Preferred Stock, voting separately as a class, is
required to authorize a given action of the Corporation, the affirmative vote
or consent of the holders of at least a majority of the outstanding shares of
the Series E Convertible Preferred Stock shall constitute the approval of such
action by the class.  To the extent that under Colorado law the holders of the
Series E Convertible Preferred Stock are entitled to vote on a matter with
holders of Common Stock, voting together as one class, each share of  Series E
Convertible Preferred Stock shall be entitled to a number of votes equal to
the number of shares of Common Stock into which it is then convertible using
the record date for the taking of such vote of stockholders as the date as of
which the Conversion Price is calculated.  Holders of the Series E Convertible
Preferred Stock shall be entitled to notice of all shareholders meetings or
written consents with respect to which they would be entitled to vote, which
notice would be provided pursuant to the Corporation's by-laws and applicable
statutes.

     Section 6.     PROTECTIVE PROVISIONS.  So long as shares of Series E
Convertible Preferred Stock are outstanding, the Corporation shall not take
any action that would impair the rights of the holders of the Series E
Convertible Preferred Stock set forth herein and shall not without first
obtaining the approval (by vote or written consent, as provided by law) of the
holders of at least a majority of the then outstanding shares of  Series E
Convertible Preferred Stock:

          a.   alter or change the rights, preferences or privileges of the
shares of the  Series E Convertible Preferred Stock or any other securities so
as to affect adversely the Series E Convertible Preferred Stock;

          b.   create any new class or series of stock having a preference
over, or being on a parity with, the Series E Convertible Preferred Stock with
respect to distributions pursuant to Section 5 above; or

          c.   do any act or thing which would result in taxation of the
holders of shares of the Series E Convertible Preferred Stock under Section
305 of the Internal Revenue Code of 1986, as amended (or any comparable
provision of the Internal Revenue Code as hereinafter from time to time
amended)

     Section 7.     STATUS OF CONVERTED OR REACQUIRED STOCK.  In case any
shares
of Series E Convertible Preferred Stock shall be converted pursuant to Section
1 hereof, the shares so converted shall cease to be a part of the authorized
capital stock of the Corporation.

     Section 8.     REDEMPTION PROVISIONS.  Shares of the Series E Convertible
Preferred Stock are not redeemable.

     Section 9.     DIVIDEND PROVISIONS.  The holders of shares of the Series
E
Convertible Preferred Stock are not entitled to receive any dividends.

     Section 9.     NOTICES.  Any notice required to be given to holders of
shares of Series E Convertible Preferred Stock shall be deemed given upon
deposit in the United States mail, postage prepaid, addressed to such holder
of record at his address appearing on the books of the Corporation, or upon
personal delivery of the aforementioned address."

     THIRD:  Such Amendment was duly adopted by the Board of Directors of the
Corporation on the 8th day of April 1996.

     IN TESTIMONY WHEREOF, the undersigned Corporation has caused these
Articles of Amendment to the Articles of Incorporation to be signed by a duly
authorized officer and duly attested by another such officer, to be hereunto
affixed this 16th day of April 1996.

                              RETIREMENT CARE ASSOCIATES, INC.


                              By  /s/ Chris Brogdon
                                  Chris Brogdon, President
ATTEST:

/s/ Edward E. Lane
Edward E. Lane, Secretary