Amended and Restated Employment Agreement effective as of April 1, 2012



 Exhibit 10.2 
 AMENDED AND RESTATED 
 EMPLOYMENT AGREEMENT 

This Amended and Restated Agreement (this “Agreement”) made effective as of April 1, 2012, by and between Advocat Inc., a
Delaware corporation (the “Company”), and Kelly Gill (the “Executive”), amends and restates the Employment Agreement between the parties dated April 10, 2010, as amended on November 4, 2011 (the “Original
Agreement”). 
 WHEREAS, the latest extended term of the Original Agreement term ends March 31, 2012; and 

WHEREAS, subsequent to entering into the Original Agreement, the Company appointed Executive the Chief Executive Officer of the Company,
and the Executive agreed to serve in such position; and 
 WHEREAS, the parties have agreed to amend and restate the Original
Agreement to reflect the change in position, to extend the term, to clarify certain ambiguous terms and to make other changes as set forth herein. 
 In consideration of the mutual covenants contained in this Agreement, the parties hereby agree as follows: 
 SECTION I 
 EMPLOYMENT 

The Company agrees to employ the Executive and the Executive agrees to be employed by the Company for the Period of Employment as
provided in Section III.A. below and upon the terms and conditions provided in the Agreement. 
 SECTION II 

POSITION AND RESPONSIBILITIES 
 During the Period of Employment, the Executive agrees to serve as Chief Executive Officer of the Company and to be responsible for the typical management responsibilities expected of an officer holding
such position and such other responsibilities as may be assigned to the Executive from time to time by the Board of Directors of the Company. 
 SECTION III 
 TERMS AND DUTIES 

A. Period of Employment. The period of Executive’s employment under this Agreement will commence as of the date hereof and
shall continue through March 31, 2013, subject to extension or termination as provided in this Agreement (the “Period of Employment”). On each anniversary of the commencement of the Period of Employment, the period of Executive’s
employment shall be extended for additional one (1) year periods, unless either party gives notice thirty (30) days in advance of the expiration of the then current period of employment of such party’s intent not to extend the Period
of Employment. 







 B. Duties. During the Period of Employment, the Executive shall devote all of his
business time, attention and skill to the business and affairs of the Company and its subsidiaries. The Executive will perform faithfully the duties that may be assigned to him from time to time by the Board of Directors. 

SECTION IV 

COMPENSATION AND BENEFITS 
 A. Compensation. For all services rendered by the Executive in any capacity during the Period of Employment, the Executive shall be compensated as follows: The Company shall pay the Executive a
base salary (“Base Salary”) of Four Hundred Fifty Thousand Dollars ($450,000.00) per annum. Base Salary shall be payable according to the customary payroll practices of the Company but in no event less frequently than once each month. The
Base Salary shall be reviewed annually and shall be subject to increase according to the policies and practices adopted by the Company from time to time. 
 B. Annual Incentive Awards. The Company will pay the Executive annual incentive compensation awards as may be granted by the Board of Directors or a Compensation Committee, in either case, in its
sole discretion, to the Executive under any executive bonus or incentive plan in effect from time to time. In all events, any such incentive bonuses or payments will be made on or before March 15 following the Executive’s taxable year in
which such award is no longer subject to a substantial risk of forfeiture as defined by Treasury Regulation Section 1.409A-1(d). 
 C. Additional Benefits. The Executive will be entitled to participate in all compensation or employee benefit plans or programs and receive all benefits and perquisites for which any salaried
employees are eligible under any existing or future plan or program established by the Company for salaried employees. The Executive will participate to the extent permissible under the terms and provisions of such plans or programs in accordance
with program provisions. These may include group hospitalization, health, dental care, life or other insurance, tax qualified pension, car allowance, savings, thrift and profit sharing plans, termination pay programs, sick leave plans, travel or
accident insurance, disability insurance, and contingent compensation plans including capital accumulation programs, restricted stock programs, stock purchase programs and stock option plans. Nothing in this Agreement will preclude the Company from
amending or terminating any of the plans or programs applicable to salaried or senior executives as long as such amendment or termination is applicable to all salaried employees or senior executives. The Executive will be entitled to twenty
(20) days paid vacation annually. 

  
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 SECTION V 
 BUSINESS EXPENSES 
 The Company will reimburse the Executive for all
reasonable travel and other expenses incurred by the Executive in connection with the performance of his duties and obligations under this Agreement. 
 SECTION VI 
 DISABILITY 

A. In the event of Disability of the Executive during the Period of Employment, the Company will continue to pay the Executive according
to the compensation provisions of this Agreement during the period of his Disability, until such time as Executive’s long term disability insurance benefits are available. However, in the event the Executive is Disabled for a continuous period
of six (6) months after the Executive first becomes Disabled, the Company may terminate the employment of the Executive. In this case, normal compensation will cease except for earned but unpaid Base Salary and incentive compensation awards
which would be payable on a pro-rated basis for the year in which the Disability occurred. In the event of such termination, all unvested Options held by Executive shall be deemed fully vested on the date of such termination. 

B. Until such time as the Executive’s employment is terminated as provided in Section VI.A or otherwise in accordance with this
Agreement, during the period the Executive is receiving payments of either regular compensation or disability insurance benefits described in this Agreement and as long as he is physically and mentally able to do so, the Executive will furnish
information and assistance to the Company and from time to time will make himself available to the Company to undertake assignments consistent with his prior position with the Company and his physical and mental health. If the Company fails to make
a payment or provide a benefit required as part of the Agreement, the Executive’s obligation to furnish such information and assistance will end. 
 SECTION VII 
 DEATH 

In the event of the death of the Executive during the Period of Employment, the Company’s obligation to make payments under this
Agreement shall cease as of the date of death, except for earned but unpaid Base Salary and incentive compensation awards which will be paid on a pro-rated basis for that year. The Executive’s designated beneficiary will be entitled to receive
the proceeds of any life or other insurance or other death benefit programs provided in this Agreement. 
 SECTION VIII

 EFFECT OF TERMINATION OF EMPLOYMENT 
 A. If the Executive’s employment terminates due to either a Without Cause Termination or a Constructive Discharge (as defined later in this Agreement) other than pursuant to Section XI, but only if
Executive has executed and not revoked within the revocation period a valid release agreement in a form reasonably acceptable to the Company, the Company will pay the Executive in 

  
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a lump sum an amount equal to 100% of his Base Salary as in effect at the time of the termination upon the effectiveness of the release, subject to Section XII. Earned but unpaid Base Salary and
incentive compensation awards will be paid in a lump sum upon such Termination or Constructive Discharge. The group hospitalization, health, dental care and life insurance benefits described in this Agreement as in effect at the date of termination
of employment will be continued for eighteen (18) months. If the Executive’s employment terminates due to either a Without Cause Termination or a Constructive Discharge, or pursuant to Section XI, all unvested options and SARS
(“Options”) or restricted stock or restricted stock units granted to the Executive under the Company’s 2005 Long-Term Incentive Plan, 2010 Long-Term Incentive Plan or other stock option program or plan (the “Plan”) shall be
deemed vested, and the Company shall cause each Option to remain exercisable until the earlier of (i) the latest date upon which the Option could have expired by its original terms under any circumstances or the tenth anniversary of the
original date of grant of such Option or (ii) the later of the fifteenth (15th) day of the third (3rd) month following the date on which the Option would have expired or December 31 of the calendar year in which the Option would
have expired. Any restricted stock units that are held by the Executive at the time of such termination of employment shall be settled in accordance with their terms. 
 B. If the Executive’s employment terminates due to a Termination for Cause, earned but unpaid Base Salary will be paid through the date the termination occurs. No other payments will be made or
benefits provided by the Company. 
 C. Upon termination of the Executive’s employment other than for reasons due to death,
Disability, or pursuant to Paragraph A of this Section or Section XI, the Period of Employment and the Company’s obligation to make payments under this Agreement will cease as of the date of the termination except as expressly set forth in this
Agreement. 
 D. For this Agreement, the following terms have the following meanings: 

1. “Termination for Cause” means termination of the Executive’s employment by the Company’s Board of Directors acting
in good faith by the Company by written notice to the Executive specifying the event relied upon for such termination, due to the Executive’s serious, willful misconduct with respect to his duties under this Agreement, including but not limited
to conviction for a felony or perpetration of a common law fraud, which has resulted or is likely to result in material economic damage to the Company. 
 2. “Constructive Discharge” means termination of the Executive’s employment by the Executive in accordance with this Section VIII.D.2 as a result of any of the following: a material
diminution of Base Salary of the Executive other than reductions applicable to all employees of the Company; a material diminution in the Executive’s authority, duties or responsibilities; a material diminution in the budget over which the
Executive retains authority; a material change in geographic location at which the Executive must perform the services; or any other action or inaction that constitutes a material breach of the terms of this Agreement. Provided, however, that such
condition shall not constitute a reason for Constructive Discharge unless the Executive provides the Company a written notice which describes the circumstances being relied on for the termination with respect to this Agreement within ninety
(90) days after the event giving rise 

  
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to the notice and provides the Company with thirty (30) days to remedy the condition. Further, any termination of employment by the Executive must occur within one hundred twenty
(120) days from the initial existence of the condition giving rise to the Constructive Discharge. 
 3. “Without Cause
Termination” means termination of the Executive’s employment by the Company or the giving of notice by the Company of its intent not to extend the Period of Employment as provided in Section III.A upon expiration of the Period of
Employment or any extension thereof; provided, however, that a Without Cause Termination shall not include termination by reason of death, Disability or Termination for Cause. 
 E. Stock Option Settlement. If the Executive’s employment terminates due to either a Without Cause Termination or a Constructive Discharge or pursuant to Section XI, Executive may require the
Company to repurchase any vested Options (whether such Options vested prior to termination of employment or pursuant to this Agreement) for an amount equal to the difference between the fair market value of a share of the Company’s common stock
on the date of termination and the per share exercise price set forth in the Options, times the number of shares granted to the Executive under the Options remaining unexercised as of the date of termination. If the Company gives the Executive
notice of a Without Cause Termination pursuant to Section VIII.D.1 or notice pursuant to Section XI, such right must be exercised within ten (10) days after such notice by written notice from the Executive to the Company or if the Executive
gives the Company notice of termination for Constructive Discharge or pursuant to Section XI, this right must be exercised by the Executive in such notice or by separate written notice delivered to the Company contemporaneously with such notice of
termination. The Options for which such settlement is elected will be settled as soon as reasonable practicable after the date of the Executive’s termination of employment, subject to Section XII, if applicable. Any Option held by the Executive
for which no such election is made shall continue according to their terms as modified by Sections VIII.A and XI. 
 F.
Payment in Lieu of any Benefit. In the event the Company is unable for whatever reason to provide continued coverage for the Executive under one or more of such employee benefit plans or programs as required pursuant to this Section VIII or
Section XI, the Company shall be required to make a lump sum cash payment equal to the economic value of such coverage without any discount or reduction for the time value of money. With respect to an employee benefit plan or program of the Company
that provides coverage on an insured basis, such economic value shall be the cost of the total premiums expected to be paid by the Company for such coverage of the Executive during the period such benefits are to be provided under this Agreement,
grossed up for any income, payroll or similar taxes to which such payments may be subject. With respect to all other employee benefit plans or programs of the Company, the economic value shall be the expected net cost to the Company of providing
such coverage to the Executive during the period such benefits are to be provided under this Agreement, grossed up for any income, payroll or similar taxes to which such payments may be subject. The lump sum cash payment shall be paid to the
Executive within the earlier of (i) thirty (30) days of the date the Company determines that the coverage required by this Section VIII cannot be provided, or (ii) ninety (90) days following the Executive’s date of
termination. 

  
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 SECTION IX 
 OTHER DUTIES OF THE EXECUTIVE DURING 
 AND AFTER THE PERIOD OF EMPLOYMENT

 A. The Executive will, with reasonable notice during or after the Period of Employment, furnish information as may be in
his possession and cooperate with the Company as may reasonably be requested in connection with any claims or legal actions in which the Company is or may become a party. 
 B. The Executive recognizes and acknowledges that all information pertaining to the affairs, business, clients, customers or other relationships of the Company, as hereinafter defined, is confidential and
is a unique and valuable asset of the Company. Access to and knowledge of this information is essential to the performance of the Executive’s duties under this Agreement. The Executive will not, during the Period of Employment or after except
to the extent reasonably necessary in performance of the Executive’s duties under this Agreement, give to any person, firm, association, corporation or governmental agency any information concerning the affairs, business, clients, customers or
other relationships of the Company except as required by law. The Executive will not make use of this type of information for his own purposes or for the benefit of any person or organization other than the Company. The Executive will also use his
best efforts to prevent the disclosure of this information by others. All records, memoranda, etc. relating to the business of the Company whether made by the Executive or otherwise coming into his possession are confidential and will remain the
property of the Company. 
 C. During the Period of Employment and for a twelve (12) month period thereafter, the Executive
will not use his status with the Company to obtain loans, goods or services from another organization on terms that would not be available to him in the absence of his relationship to the Company. During the Period of Employment and for a twelve
(12) month period following termination of the Period of Employment, other than termination due to a Without Cause Termination, a Constructive Discharge or termination pursuant to Section XI: (i) the Executive will not make any statements
or perform any acts intended to advance the interest of any existing or prospective competitors of the Company in any way that will injure the interest of the Company; (ii) the Executive without prior express written approval by the Board of
Directors of the Company will not directly or indirectly own or hold any proprietary interest in or be employed by or receive compensation from any party engaged in the same or any similar business in the same geographic areas the Company does
business; and (iii) the Executive without express prior written approval from the Board of Directors, will not solicit any members of the then current clients of the Company or discuss with any employee of the Company information or operation
of any business intended to compete with the Company. For the purposes of this Agreement, proprietary interest means legal or equitable ownership, whether through stock holdings or otherwise, of a debt or equity interest (including options,
warrants, rights and convertible interests) in a business firm or entity, or ownership of more than 5% of any class of equity interest in a publicly-held company. The Executive acknowledges that the covenants contained herein are reasonable as to
geographic and temporal scope. For a twelve (12) month period after termination of the Period of Employment for any reason, the Executive will not directly or indirectly (i) hire any employee of the Company or (ii) solicit or
encourage any such employee to leave the employ of the Company. 

  
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 D. The Executive acknowledges that his breach or threatened or attempted breach of any
provision of this Section IX would cause irreparable harm to the Company not compensable in monetary damages and that the Company shall be entitled, in addition to all other applicable remedies, to a temporary and permanent injunction and a decree
for specific performance of the terms of this Section IX without being required to prove damages or furnish any bond or other security. 
 E. The Executive shall not be bound by the provisions of this Section IX in the event of the default by the Company in its obligations under this Agreement which are to be performed upon or after
termination of this Agreement. 
 SECTION X 
 INDEMNIFICATION, LITIGATION 
 The Company will indemnify the Executive to
the fullest extent permitted by the laws of the state of incorporation in effect at that time, or certificate of incorporation and by-laws of the Company whichever affords the greater protection to the Executive. The Executive will be entitled to
any insurance proceeds related to any award, or any fees or expenses incurred in connection with any action, suit or proceeding to which he may be made a party by reason of being a director or officer of the Company. 

SECTION XI 

CHANGE IN CONTROL 
 In the event there is a Change in Control (as defined below) of the Company and (1) within ninety (90) days prior to such event the Executive is terminated due to either a Without Cause
Termination or a Constructive Discharge or (2) within six (6) months following such event the Executive is terminated due to either a Without Cause Termination or a Constructive Discharge or elects to resign upon written notice to the
Company, but only if Executive has executed and not revoked within the revocation period a valid release agreement in a form reasonably acceptable to the Company, the Company shall pay to the Executive upon the effectiveness of such release, subject
to Section XII, in a lump sum an amount equal to 200% of his Base Salary as in effect at the time of such termination or resignation. In addition, earned but unpaid Base Salary and pro-rated incentive compensation awards will be paid through the
date of termination for the year in which termination or resignation occurs. Any Options or restricted stock or restricted stock units granted to the Executive pursuant to the Plan prior to resignation or termination, but subject to vesting
restrictions, will be fully vested upon a Change in Control whether or not the Executive resigns. Any restricted stock units that are held by the Executive at the time of such termination of employment shall be settled in accordance with their
terms. Subject to Section VIII.F, the group hospitalization, health, dental care and life insurance benefits described in this Agreement as in effect at the date of termination of employment will also be continued for twenty-four (24) months
from the effective date of termination pursuant to a Change of Control. 

  
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 SECTION XII 
 CODE SECTION 409A 
 A. Administration and Construction. To the
extent applicable (as determined by Section XII.B, below), the parties hereto intend that this Agreement comply with Section 409A. This Agreement shall be construed in such a manner as to be in compliance with Section 409A. Any term used
in this Agreement which is defined in Section 409A or the regulations promulgated thereunder (the “Regulations”) shall have the meaning set forth therein unless otherwise specifically defined herein. Should any provision be found to
be not in compliance with Section 409A, the parties are hereby contractually obligated to execute any and all amendments to this Agreement deemed necessary and required by legal counsel for the parties to achieve compliance with
Section 409A. To the extent the legal counsel for the parties disagree as to the terms or other provisions of any amendment deemed necessary to comply with Section 409A, such dispute shall be resolved in accordance with Section XII.B.

 B. Procedures for Determining Application of Section 409A. Executive and the Company shall cooperate to determine
the application of Section 409A for purposes of this Agreement. If Executive and the Company are unable to agree on the application of Section 409A within ten (10) business days after the Executive’s separation from service with
the Company or otherwise disagree with respect to any amendment to the Agreement in order to comply with Section 409A, then the application of Section 409A (or dispute with respect to Section 409A) for purposes of this Agreement shall
be determined by an accounting firm of recognized national standing acceptable to the Executive and the Company. The accounting firm shall be instructed to use every reasonable effort to make its determination within ten (10) business days
after it is retained. The parties will cooperate fully with the accounting firm. The costs and expenses for the services of the accounting firm shall be borne equally by the Executive and the Company. The determination of such accounting firm shall
be final and binding on all parties. 
 C. Section 409A Compliance. 

1. All payments to be made to the Executive upon a termination of employment may only be made upon a “separation from service”
(defined below) of the Executive. For purposes of Section 409A, (i) the Executive may not, directly or indirectly, designate the calendar year of payment; and (ii) no acceleration of the time and form of payment of any nonqualified
deferred compensation to the Executive, or any portion thereof, shall be permitted. 
 2. Delayed Payments. 

(i) Notwithstanding any other payment schedule provided herein to the contrary, if, and only if, the Executive is deemed
on his termination date to be a “specified employee” within the meaning of that term under section 409A(a)(2)(B) of the Code, then the terms of this Subsection shall apply as required by Section 409A. Any payment that is considered
deferred compensation under Section 409A payable on account of a “separation from service” shall be made on the date that is the earlier of (y) the expiration of the six (6) month period measured from the date of such
“separation from service” of the Executive or 

  
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(z) the date of the Executive’s death (the “Delay Period”) to the extent required under Section 409A. Upon the expiration of the Delay Period, all payments delayed pursuant to
the immediately preceding sentence (whether they otherwise would have been payable in a single sum or in installments in the absence of such delay) shall be paid to the Executive in a lump sum by the Company, and all remaining payments due under
this Agreement shall be paid or provided in accordance with the normal payment dates specified for them herein. 

(ii) To the extent that any benefits to be provided during the Delay Period are considered deferred compensation under
Section 409A provided on account of a “separation from service,” and such benefits are not otherwise exempt from Section 409A, the Executive shall pay the cost of such benefits during the Delay Period, and the Company shall
reimburse the Executive, to the extent that such costs otherwise would have been paid by the Company or to the extent that such benefits otherwise would have been provided by the Company at no cost to the Executive, the Company’s share of the
cost of such benefits upon expiration of the Delay Period, and any remaining benefits shall be reimbursed or provided by the Company in accordance with the procedures specified herein. 

3. Notwithstanding the applicable provisions of this Agreement regarding the timing of payments, any payment or benefit due hereunder
which is contingent upon receipt of a release shall be made in accordance with this Subsection. Any such payment or other benefits described in Section VIII or XI will be paid or begin to be paid within sixty (60) days following the
Executive’s termination of employment (subject to Subsection XII.C.2, if applicable). Notwithstanding the foregoing, if such 60-day period begins in one taxable year of the Executive and ends in the subsequent taxable year of the Executive, the
payments will be paid or begin to be paid in the subsequent taxable year (subject to XII.C.2). 
 4. Notwithstanding any other
provision of the plans or programs constituting the benefits described herein, (i) the amount of expenses eligible for reimbursement and the provision of in-kind benefits during any calendar year shall not affect the amount of expenses eligible
for reimbursement or the provision of in-kind benefits in any other calendar year; (ii) the reimbursement of an eligible expense shall be made on or before December 31 of the calendar year following the calendar year in which the expense
was incurred; and (iii) the right to reimbursement or right to in-kind benefit shall not be subject to liquidation or exchange for another benefit. 
 D. Section 409A Definitions. 
 1. Section 409A. Section 409A shall
mean section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and the final regulations issued thereunder. 
 2. For purposes of this Agreement, the phrase termination of employment or any similar term or phrase shall mean the Executive’s “separation from service” as defined by the default
provisions of Treas. Reg. § 1.409A-1(h). 

  
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 3. A “Change in Control” shall mean any of the following: 

(i) Change of Ownership of the Company. The date that any one person, or more than one person acting as a group,
acquires ownership of stock of the Company that, together with stock held by such person or group, constitutes more than fifty percent (50%) of the total fair market value or total voting power of the stock of the Company. However, if any one
person, or more than one person acting as a group, is considered to own more than fifty percent (50%) of the total fair market value or total voting power of the stock of the Company, the acquisition of additional stock by the same person or
persons is not considered to cause a change in the ownership of the Company. An increase in the percentage of stock owned by any one person, or persons acting as a group, as a result of a transaction in which the Company acquires its stock in
exchange for property will be treated as an acquisition of stock for purposes of this Section XII.D.3(i). This Section XII.D.3(i) applies only when there is a transfer of stock of the Company (or issuance of stock of the Company) and stock in the
Company remains outstanding after the transaction. 
 (ii) Change in the Effective Control of the Company.

 (a) The date any one person, or more than one person acting as a group, acquires (or has acquired during the
12-month period ending on the date of the most recent acquisition by such person or persons) ownership of stock of the Company possessing thirty percent (30%) or more of the total voting power of the stock of the Company. If any one person, or
more than one person acting as a group, is considered to effectively control the Company (within the meaning of this Section XII.D.3(ii)(a)), the acquisition of additional control of the Company by the same person or persons is not considered to
cause a change in the effective control of the Company (or to cause a change in the ownership of the corporation within the meaning of Section XII.D.3(i)). 
 (b) The date a majority of members of the Company’s Board of Directors is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members
of the Board of Directors before the date of the appointment or election. 
 (iii) Change in the Ownership of
a Substantial Portion of the Company’s Assets. The date that any one person, or more than one person acting as a group, acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or
persons) assets from the Company that have a total gross fair market value equal to or more than eighty percent (80%) of the total gross fair market value of all of the assets of the corporation immediately before such acquisition or
acquisitions. For this purpose, gross fair market value means the value of the assets of the Company, or the value of the assets being disposed of, determined without regard to any liabilities associated with such assets. Notwithstanding the
foregoing, a Change in Control shall not be deemed to have occurred for purposes of this Agreement when there is a transfer to an entity that is controlled by the shareholders of the Company immediately after the transfer as provided in the
following sentence. A transfer of assets by the Company is not treated as a change in the ownership of such assets if the assets are transferred to (w) a shareholder of the 

  
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Company (immediately before the asset transfer) in exchange for or with respect to its stock in the Company, (x) an entity, fifty percent (50%) or more of the total voting power of
which is owned, directly or indirectly, by the Company, (y) a Person, or more than one Person acting as a group, that owns, directly or indirectly, fifty percent (50%) or more of the total voting power of all the outstanding stock of the
Company, or (z) an entity, at least fifty percent (50%) of the total value or voting power of which is owned, directly or indirectly, by a person described in clause (y) above. 

For purposes of this Section XII.D.3, persons will not be considered to be acting as a group solely because they purchase
or own stock of the same corporation at the same time, or as a result of the same public offering. However, persons will be considered to be acting as a group if they are owners of a corporation that enters into a merger, consolidation, purchase or
acquisition of stock, or similar business transaction with the corporation. If a person, including an entity, owns stock in both corporations that enter into a merger, consolidation, purchase or acquisition of stock, or similar transaction, such
shareholder is considered to be acting as a group with other shareholders only with respect to the ownership in that corporation before the transaction giving rise to the change and not with respect to the ownership interest in the other
corporation. 
 This definition of “Change in Control” is intended to be consistent with the phrase
“change in the ownership or effective control of the corporation, or in the ownership of a substantial portion of the assets of the corporation” as used in section 409A(a)(2)(A)(v) of the Code and the Regulations promulgated thereunder and
shall be interpreted and applied in a manner consistent with such intent. Further, this definition is intended to comply with Section 409A and shall be interpreted in accordance therewith. 

(4) “Disability” or “Disabled” as used in this Agreement means the Executive is unable to engage in any substantial
gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months. 

SECTION XIII 

WITHHOLDING TAXES 
 The Company may directly or indirectly withhold from any payments under this Agreement all federal, state, city or other taxes that shall be required pursuant to any law or governmental regulation.

 SECTION XIV 
 EFFECTIVE PRIOR AGREEMENTS 
 This Agreement contains the entire
understanding between the Company and the Executive with respect to the subject matter and supersedes any prior employment or severance agreements between the Company and its affiliates and the Executive. 

  
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 SECTION XV 
 CONSOLIDATION, MERGER OR SALE OF ASSETS 
 Nothing in this Agreement shall
preclude the Company from consolidating or merging into or with, or transferring all or substantially all of its assets to, another corporation which assumes this Agreement and all obligations and undertakings of the Company hereunder. Upon such a
consolidation, merger or sale of assets, the term “the Company” as used in this Agreement will mean such other corporation and this Agreement shall continue in full force and effect. This Section XV is not intended to modify or limit the
rights of the Executive hereunder, including without limitation, the rights of Executive under Section XI. 
 SECTION XVI

 MODIFICATION 
 This Agreement may not be modified or amended except in writing signed by the parties. No term or condition of this Agreement will be deemed to have been waived except in writing by the party charged with
waiver. A waiver shall operate only as to the specific term or condition waived and will not constitute a waiver for the future or act on anything other than that which is specifically waived. 

SECTION XVII 

GOVERNING LAW; ARBITRATION 
 This Agreement has been executed and delivered in the State of Tennessee and its validity, interpretation, performance and enforcement shall be governed by the laws of that state. 

Any dispute among the parties hereto shall be settled by arbitration in Nashville, Tennessee, in accordance with the rules then obtaining
of the American Arbitration Association and judgment upon the award rendered may be entered in any court having jurisdiction thereof. 
 SECTION XVIII 
 NOTICES 

All notices, requests, consents and other communications hereunder shall be in writing and shall be deemed to have been made when
delivered or mailed first-class postage prepaid by registered mail, return receipt requested, or if delivered by hand, overnight delivery service or confirmed facsimile transmission, to the following: 

(a) If to the Company, at 1621 Galleria Boulevard, Brentwood, TN 37027-2926, Attention: Corporate Secretary, or at such other address as
may have been furnished to the Executive by the Company in writing; or 
 (b) If to the Executive, at such address of the
Executive as may have been furnished to the Company by the Executive in writing. 

  
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 SECTION XIX 
 BINDING AGREEMENT 
 This Agreement shall be binding on the parties’
successors, heirs and assigns. 
 [signature page follows] 

  
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 IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first above
written. 
  

			
	ADVOCAT INC.
		
	By:	 	 /s/ Richard Brame

		
	Title:	 	 Chairman of Compensation Committee

	
	EXECUTIVE:
	
	 /s/ Kelly Gill

	Kelly Gill



  
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