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                                   EXHIBIT 4.2

                                 RES-CARE, INC.

            2000 NONEMPLOYEE DIRECTORS STOCK OWNERSHIP INCENTIVE PLAN

ARTICLE 1:      PURPOSE.

         The purpose of this 2000 Nonemployee Directors Stock Ownership
Incentive Plan ("Plan") is to advance the interests of Res-Care, Inc., a
Kentucky corporation ("Company"), and its subsidiaries, by providing nonemployee
directors of the Company with an ownership interest in the Company. The Plan is
also intended to enhance the Company's ability to attract and retain persons of
outstanding ability to serve as directors of the Company.

ARTICLE 2:      DEFINITIONS AND CONSTRUCTION.

         2.1 Definitions. As used in the Plan, the terms defined
parenthetically, immediately after their use shall have the respective meanings
provided by such definitions, and the terms set forth below shall have the
following meanings (in either case, such meanings shall apply equally to both
the singular and plural forms of the terms defined):

                (a) "Award" shall mean a grant of Options under Section 5 of
the Plan.

                (b) "Award Date" shall mean the first business day of July of
each calendar year that the Plan is in effect.

                (c) "Board" shall mean the Board of Directors of the Company.

                (d) "Change of Control" means (i) an event or series of events
which have the effect of any "person" as such term is used in Section 13(d) and
14(d) of the Exchange Act, other than any trustee or other fiduciary holding
securities of the Company under any employee benefit plan of the Company,
becoming the "beneficial owner" as defined in Rule 13d-3 under the Exchange Act,
directly or indirectly, of securities of the Company representing 30% or more of
the combined voting power of the Company's then outstanding capital stock; (ii)
any merger, consolidation, share exchange, recapitalization or other transaction
in which any person becomes the beneficial owner of securities of the Company
representing 30% or more of the combined voting power of the Company's then
outstanding capital stock; (iii) the persons who were members of the Board
immediately before a transaction shall cease to constitute a majority of the
Board of the Company or any successor to the Company; (iv) the business of the
Company is disposed of pursuant to a partial or complete liquidation, sale of
assets, or otherwise.

                (e) "Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time, or any successor thereto, together with any
regulations promulgated thereunder.

                (f) "Committee" shall mean the committee described in
Section 3.1.

                (g) "Director"  shall mean a member of the Board who is not an
employee of the Company or any Subsidiary of the Company.


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                (h) "Disability" shall mean a physical or mental infirmity that
the Committee determines impairs the Director's ability to perform substantially
his or her duties for a period of 180 consecutive days.

                (i) "Effective Date" shall mean the date described in
Section 6.1.

                (j) "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended from time to time.

                (k) "Fair Market Value" of the Shares shall mean, as of any
Award Date, the closing sale price of the Shares as reported on the NASDAQ
National Market, or if no such reported sale of the Shares shall have occurred
on such date, on the next preceding date on which there was a reported sale. If
there shall be any material alteration in the present system of reporting sale
prices of the Shares, or if the Shares shall no longer be listed on the NASDAQ
National Market, the Fair Market Value of the Shares as of an Award Date shall
be determined by such method as shall be determined in good faith by the
Committee.

                (l) "Option" shall mean an option to purchase Shares granted
pursuant to Article 5.

                (m) "Optionee" shall mean a person to whom an option has been
granted under the Plan.

                (n) "Option Agreement" shall mean an agreement evidencing the
grant of an Option, as described in Section 5.2.

                (o) "Option Exercise Price" shall mean the purchase price per
Share subject to an Option, which shall be the Fair Market Value of the Share on
the Award Date.

                (p) "Person" shall have the meaning ascribed to such term in
Section 3(a) (9) of the Exchange Act and as used in Sections 13(d) and 14(d)
thereof, including a "group" as defined in Section 13(d) thereof.

                (q) "Plan" shall mean this Res-Care, Inc. 2000 Nonemployee
Directors Stock Ownership Incentive Plan as the same may be amended from time
to time.

                (r) "Retirement" shall mean retirement by a Director in
accordance with the terms of the Company's retirement policy applicable to
directors of the Company.

                (s) "Shares" shall mean the Company's Common Shares.

                (t) "Subsidiary" shall mean, with respect to any company, any
corporation or other Person of which a majority of its voting power, equity
securities, or equity interest is owned directly or indirectly by such company.

                (u) "Withholding Taxes" shall mean all federal, state and local
income taxes and other amounts as may be required by law to be withheld with
respect to any option exercise, if any.


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         2.2 Gender and Number. Except where otherwise indicated by the context,
reference to the masculine gender shall include the feminine gender, the plural
shall include the singular and the singular shall include the plural.

         2.3 Severability. In the event any provision of the Plan shall be held
illegal or invalid for any reason, the illegality or invalidity shall not affect
the remaining parts of the Plan, and the Plan shall be construed and enforced as
if the illegal or invalid provision had not been included.

ARTICLE 3:      ADMINISTRATION.

         3.1 The Committee. The Plan is designed to operate automatically and
not require administration. However, to the extent administration is required,
it shall be provided by a committee (the "Committee"). The members of the
Committee shall include two or more members of the Board, and shall be appointed
from time to time by, and shall serve at the discretion of, the Board. If the
Board fails to appoint the Committee, the Board shall administer the Plan.

         3.2 Authority of the Committee. Subject to the provisions of the Plan,
the Committee shall have full authority to:

                (a) construe and interpret the Plan and any agreement or
instrument entered into under the Plan; and

                (b) establish, amend and rescind rules and regulations for the
Plan's administration.

To the extent permitted by law and Rule 16b-3 promulgated under the Exchange
Act, the Committee may delegate its authority as identified herein.

         3.3 Decisions Binding. All determinations and decisions made by the
Committee pursuant to the provisions of the Plan, and all related orders or
resolutions of the Board, shall be final, conclusive and binding on all Persons,
including the Company, the Directors and their estates and beneficiaries.

         3.4 Section 16 Compliance. It is the intention of the Company that the
Plan and the administration of the Plan comply in all respects with Section 16
of the Exchange Act and the rules and regulations promulgated thereunder. If any
Plan provision, or any aspect of the administration of the Plan, is found not to
be in compliance with Section 16 of the Exchange Act, the provision or aspect of
administration shall be null and void to the extent permitted by law and deemed
advisable by the Committee. In all events the Plan shall be construed in favor
of its meeting the requirements of Rule 16b-3 promulgated under the Exchange
Act.

ARTICLE 4:      SHARES AVAILABLE UNDER THE PLAN.

         4.1 Number of Shares. Subject to adjustment as provided in Section 4.2,
the number of Shares reserved for issuance upon the exercise of options is
100,000 Shares. Any Shares issued under the Plan may consist, in whole or in
part, of authorized and unissued Shares or treasury shares. If and to the extent
options shall expire or terminate for any reason without having been exercised
in


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full, the Shares associated with such Awards to the extent not fully
exercised shall again become available for Awards under the Plan.

         4.2 Adjustments in Authorized Shares and Outstanding Awards. In the
event of a merger, reorganization, consolidation, recapitalization,
reclassification, split-up, spin-off, separation, liquidation, share dividend,
stock split, reverse stock split, cash dividend, property dividend, share
repurchase, share combination, share exchange, issuance of warrants, rights or
debentures, or other change in the corporate structure of the Company affecting
the Shares, the Committee may substitute or adjust the total number and class of
Shares or other stock or securities that may be issued under the Plan, and the
number, class and/or price of Shares. or other stock or securities subject to
outstanding Awards, as it determines to be appropriate and equitable to prevent
dilution or enlargement of the rights of Directors and to preserve, without
exceeding, the value of any outstanding Awards; and further provided, that the
number of Shares or other stock or securities subject to any Award shall always
be a whole number.

ARTICLE 5:      AWARDS.

         5.1 Automatic Grant of Options. Subject to the terms and provisions of
the Plan, each Director on an Award Date shall automatically receive an option
for 4,500 Shares that is not intended to qualify as an incentive stock option
within" the meaning of Section 422 of the Code.

         5.2 Vesting. Subject to Sections 5.4 and 5.7, each Option shall vest
and become exercisable with respect to 25% of the Shares subject thereto
effective immediately as of the Award Date and shall vest and become exercisable
with respect to an additional 25% of the Shares subject thereto effective as of
each of the first, second and third anniversaries of the Award Date; provided,
however, that the Director continues to serve as a member of the Board as of
such dates. If a Director ceases to serve as a member of the Board for any
reason, the Director shall have no rights with respect to that portion of an
option which is not then vested pursuant to the preceding sentence and the
Director shall automatically forfeit that portion of the Option that remains
unvested.

         5.3 Option Agreement. Each Award shall be evidenced by an Option
Agreement that shall specify the Option Exercise Price, the duration of the
Option, the number of Shares to which the option relates and such other terms
and conditions not inconsistent with the provisions of this Plan as determined
by the Committee; provided, however, that such terms shall not vary the timing
of Awards, including provisions dealing with exercisability, forfeiture or
termination of such Awards or Options granted thereunder.

         5.4 Duration of Options. Subject to Section 5.6, each Option shall
expire on the fifth (5th) anniversary of the Award Date on which it was granted.

         5.5 Method of Exercise. The exercise of an Option shall be made only by
a written notice delivered in person or by mail to the Secretary of the Company
at the Company's principal executive office, specifying the number of Shares to
be purchased and accompanied by payment therefor and otherwise in accordance
with the Option Agreement pursuant to which the Option was granted. Shares
purchased pursuant to the exercise of an option shall be paid in full upon such
exercise by any one or a combination of the following: (i) in cash; (ii) in
owned by the Optionee (or jointly by the Optionee and his or her spouse) for at
least six months evidenced by negotiable certificates or by a


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written attestation of ownership and consent to issuance, in satisfaction of the
Option or portion thereof being exercised, of only the net Shares (those equal
in value to the difference between the Option Exercise Price and the then Fair
Market Value); (iii) by a written election to have the Company retain that
number of Shares subject to the Option having an aggregate Fair Market Value
equal to the aggregate Option Exercise Price; or (iv) by any combination
thereof. The written notice pursuant to this Section 5.5 may also provide
instructions from the Optionee to the Company that upon receipt of the purchase
price in cash from the Optionee's broker or dealer, designated as such on the
written notice, in payment for any Shares purchased pursuant to the exercise of
an Option, the Company shall issue such Shares directly to the designated broker
or dealer. Any Shares transferred to the Company or withheld as payment of the
Option Exercise Price shall be valued at their Fair Market Value on the date
preceding the date of exercise. If requested by the Committee, the Optionee
shall deliver the Option Agreement evidencing the option to the Secretary of the
Company who shall endorse thereon a notation of such exercise and return such
Option Agreement to the Optionee. No fractional shares (or cash in lieu thereof)
shall be issued upon exercise of an Option and the number of Shares that may be
purchased upon exercise shall be rounded down to the nearest number of whole
Shares.

         5.6 Termination of Director Relationship. If a Director for any reason
other than Retirement, death or Disability shall cease to be a member of the
Board, the outstanding Options of such Director (or portions thereof) that are
vested and exercisable as of the date the Director so ceased to be a member of
the Board may be exercised by such Director at any time prior to the earlier of
the expiration date of the options or the date that is ninety (90) days after
the date on which such Director ceases to be a member of the Board. If a
Director shall cease to be a member of the Board by reason of Retirement, death
or Disability, the outstanding options of such Director (or portions thereof)
that are vested and exercisable as of the date the Director so ceased to be a
member of the Board may be exercised by such Director at any time prior to the
earlier of the expiration date of the Options or the date that is the first
anniversary of the Director's Retirement, death or Disability. Options may be
exercised as provided in this Section 5.6 (x) in the event of the death of a
Director, by the person or persons to whom rights pass by will or by the laws of
descent and distribution, or if appropriate, the legal representative of his
estate and (y) in the event of the Disability of a Director, by the Director, or
if such Director is incapacitated, by his legal representative.

         5.7 Effect of Change of Control. Notwithstanding anything contained in
the Plan or an Option Agreement to the contrary, in the event of a Change of
Control, (i) all options outstanding on the date of such Change of Control shall
become immediately and fully exercisable and (ii) an Optionee will be entitled
to receive, in lieu of the exercise of any Option or portion of an Option to the
extent not yet exercised, a cash payment in an amount equal to the difference
between the aggregate Option Exercise Price and (A) in the case of a tender
offer or exchange offer, the final offer price paid per Share, multiplied by the
number of Shares covered by the Option, or (B) in the case of any other Change
of Control, the aggregate Fair Market Value of the Shares covered by the Option.
The Company shall pay any amount it must make under this Section 5.7 within 30
days following the occurrence of the Change of Control.


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ARTICLE 6:      EFFECTIVE DATE, AMENDMENT, MODIFICATION, AND TERMINATION.

         6.1 Effective Date. The Plan shall be effective upon the approval by
the affirmative vote of the holders of a majority of the securities of the
Company represented in person or by proxy, and entitled to vote, at a meeting of
shareholders of the Company at which the Plan is submitted for approval.

         6.2 Termination Date. The Plan shall terminate on the earliest to occur
of (a) the date when all Shares available under the Plan shall have been
acquired pursuant to the exercise of Awards or (b) such other date as the Board
may determine in accordance with Section 6.3.

         6.3 Amendment, Modification and Termination.

                (a) Except as provided in Section 6.3(b), the Board may, at any
time, amend, modify or terminate the Plan.

                (b)  Without the approval of shareholders of the Company, no
amendment, modification or termination may:

                    (i)   materially increase the benefits accruing to Directors
 under the Plan;

                    (ii)  increase the total number of Shares that may be issued
under the Plan,  except as provided in Section 4.2; or

                    (iii) modify the eligibility or other requirements to
receive an Award under the Plan.

         6.4 Awards Previously Granted. No amendment, modification or
termination of the Plan shall in any manner adversely affect any outstanding
Award without the written consent of the Optionee.

ARTICLE 7.      NON-TRANSFERABILITY.

         Except as otherwise provided in this Article 7, no Option shall be
transferable by a Director otherwise than by will or the laws of descent and
distribution, and an Option shall be exercisable, during the Director's
lifetime, only by the Director (or, in the event of the Director's legal
incapacity or incompetency, the Director's guardian or legal representative). A
Director may transfer all or part of a Nonqualified Stock Option to (i) the
Director's spouse or lineal descendants ("Immediate Family Members"), (ii)
trusts for the exclusive benefit of the Director and/or his Immediate Family
Members, or (iii) a partnership or limited liability company in which the
Director and/or his Immediate Family Members are the only partners or members,
as applicable. Such transfer may be made by a Director only if there is no
consideration for the transfer, and subsequent transfers of any Option shall be
prohibited other than in accordance with this Article 7 and by will or the laws
of descent and distribution. Following a transfer of an Option, the Option shall
continue to be subject to the same terms and conditions as were applicable
immediately before the transfer, and the conditions to exercise of an Option
upon Termination of Director Relationship or otherwise provided in this Plan
shall be applied with respect to the original Director. However, for purposes of
exercising the Option, the term Director shall refer to the transferee. In
addition, for purposes of the death benefit provisions of Section 5.6,
references to a Director shall be deemed to refer to the transferee, the
personal representative of the transferee's estate, or after final settlement of
the transferee's estate, the successor or successors entitled thereto by law.


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ARTICLE 8.      NO RIGHT OF REELECTION.

         Neither the Plan nor any action taken under the Plan shall be construed
as conferring upon a Director any right to continue as a director of the
Company, to be renominated by the Board or to be reelected by the shareholders
of the Company.

ARTICLE 9.      WITHHOLDING.

         Upon the exercise of an Option (a "Taxable Event"), the Optionee shall
pay the Withholding Taxes to the Company prior to the issuance, or release from
escrow, of such Shares. In satisfaction of the obligation to pay Withholding
Taxes to the Company, the Optionee may make a written election (the "Tax
Election") to have withheld a portion of the Shares then issuable to him or her
having an aggregate Fair Market Value, on the date preceding the date of such
issuance, equal to the Withholding Taxes.

ARTICLE 10.     INDEMNIFICATION.

         No member of the Board or the Committee, nor any officer or employee
acting on behalf of the Board or the Committee, shall be personally liable for
any action, determination or interpretation taken or made with respect to the
Plan, except for liability arising from his or her own willful misfeasance,
gross negligence or reckless disregard of his or her duties. All members of the
Board, the Committee and each and any officer or employee of the company acting
on their behalf shall, to the extent permitted by law, be fully indemnified and
protected by the Company with respect to any such action, determination or
interpretation.

ARTICLE 11.     SUCCESSORS.

         All obligations of the Company with respect to Awards granted under the
Plan shall be binding on any successor to the Company, whether the existence of
such successor is a result of a direct or indirect purchase, merger,
consolidation or otherwise, of all or substantially all of the business and/or
assets of the Company.

ARTICLE 12.     GOVERNING LAW.

         To the extent not preempted by Federal law, the Plan, and all
agreements under the Plan, shall be governed by, and construed in accordance
with, the laws of the Commonwealth of Kentucky without regard to its conflict of
law rules.


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