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                                                                    EXHIBIT 10.1

                               SECOND AMENDMENT TO
                            ASSET PURCHASE AGREEMENT

     THIS SECOND AMENDMENT TO ASSET PURCHASE AGREEMENT (the "AMENDMENT") is made
and entered into effective as of April 14, 2006, by and among DIVERSICARE
ASSISTED LIVING SERVICES NC I, LLC, a Delaware limited liability company ("DALS
I"), DIVERSICARE ASSISTED LIVING SERVICES NC II, LLC, a Delaware limited
liability company ("DALS II") (DALS I and DALS II are collectively, "SELLERS"),
and AGEMARK ACQUISITION, LLC, a North Carolina limited liability company
("BUYER").

                                    RECITALS:

     A. Buyer and Sellers are parties to that certain Asset Purchase Agreement
dated November 28, 2005, as amended by the First Amendment to Asset Purchase
Agreement dated March 29, 2006 (said Asset Purchase Agreement, as amended, is
herein the "AGREEMENT").

     B. Buyer and Sellers now desire to amend the terms set forth in the
Agreement as provided in this Amendment.

     C. Capitalized terms not otherwise defined in this Amendment shall have the
meanings set forth in the Agreement.

                                   AGREEMENT:

     NOW, THEREFORE, for and in consideration of the premises and the mutual
agreements, covenants, representations, and warranties set forth herein and in
the Agreement and other good and valuable consideration, the receipt and
adequacy of which are forever acknowledged and confessed, the parties hereto
agree as follows:

     1. Buyer and Sellers shall simultaneous with the execution and delivery of
this Amendment, execute and deliver to Escrow Agent written instructions in the
form attached to this Amendment as Exhibit A, which instructions shall authorize
and direct Escrow Agent to release the Escrowed Amount to Sellers. Upon Sellers'
receipt of the Escrowed Amount, Section 2.4 of the Agreement, without further
action by the parties, shall be deleted in its entirety and replaced with the
following:

          2.4 Escrow Deposit. Buyer has previously deposited with Chicago Title
     ("ESCROW AGENT") the sum of One Hundred Thousand and No/100 Dollars
     ($100,000.00) (together with all interest thereon, the "ESCROWED AMOUNT").
     The Escrowed Amount was subsequently released by Escrow Agent to Sellers.
     If the Closing occurs, the Escrowed Amount will be credited against the
     Purchase Price. If the Closing does not occur or the Agreement is otherwise
     terminated for any reason Sellers shall retain such amounts as liquidated
     damages.

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     2. Section 6.2(3) of the Agreement shall be deleted in its entirety and
replaced with the following:

          (3) By Buyer or Sellers if Closing hereunder shall not have taken
     place by May 15, 2006, or by such later date as shall be agreed upon by an
     appropriate amendment to this Agreement if the parties agree in writing to
     an extension, provided that a party shall not have the right to terminate
     under this Section 6.2(3) if the conditions precedent to such party's
     obligation to close have been fully satisfied and such party has failed or
     refused to close after being requested in writing to close by the other
     party.

     3. Except as set forth in this Amendment, the terms and provisions of the
Agreement are hereby ratified and declared to be in full force and effect. This
Amendment shall be governed by the provisions of the Agreement regarding choice
of law, attorneys' fees and successors and assigns. This Amendment shall become
effective upon its execution, which may occur in one or more counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument. Captions and paragraph headings are used herein for
convenience only, are not a part of this Amendment or the Agreement as amended
by this Amendment and shall not be used in construing either document. On and
after the date hereof, each reference in the Agreement to "this Agreement,"
"hereunder," "hereof," "herein," or words of like import, and each reference in
the other documents and agreements relating to the Agreement, shall mean and be
a reference to the Agreement as amended hereby.

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     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed in multiple originals by their authorized officers, all as of the date
first above written.

                                        SELLERS:

                                        DIVERSICARE ASSISTED LIVING
                                        SERVICES NC I, LLC

                                        By: Diversicare Assisted Living
                                            Services NC, LLC, the sole member


                                        By: /s/ Glynn Riddle
                                            ------------------------------------
                                        Title: EVP & CFO


                                        DIVERSICARE ASSISTED LIVING
                                        SERVICES NC II, LLC

                                        By: Diversicare Assisted Living
                                            Services NC, LLC, the sole member


                                        By: /s/ Glynn Riddle
                                            ------------------------------------
                                        Title: EVP & CFO


                                        BUYER:

                                        AGEMARK ACQUSITION, LLC


                                        By: /s/ Charles E. Trefzger Jr.
                                            ------------------------------------
                                        Title: Manager


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