SEC FORM 5

SEC Form 5

FORM 5

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

ANNUAL STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934
or Section 30(h) of the Investment Company Act of 1940

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Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

Form 3 Holdings Reported.

Form 4 Transactions Reported.

1. Name and Address of Reporting Person^*

LEVINE JEFFREY L

(Last)

(First)

(Middle)

2615 DUNHOLLOW DR

(Street)

SPRINGFIELD

45503

(City)

(State)

(Zip)

2. Issuer Name and Ticker or Trading Symbol
ADCARE HEALTH SYSTEMS INC [ ADK ]

5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)

X	Director	10% Owner
	Officer (give title below)	Other (specify below)

3. Statement for Issuer's Fiscal Year Ended (Month/Day/Year)
12/31/2009

4. If Amendment, Date of Original Filed (Month/Day/Year)

6. Individual or Joint/Group Filing (Check Applicable Line)

X	Form filed by One Reporting Person
	Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)	4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned at end of Issuer's Fiscal Year (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)	Amount	(A) or (D)	Price		6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
Common Stock	12/07/2009		A4	2,800	A	⁽¹⁾	19,184	D
Common Stock	12/31/2009		L	12,278	A	⁽²⁾	19,184	D
Common Stock							19,184	D

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)	5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares	8. Price of Derivative Security (Instr. 5)		10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
Warrants	⁽³⁾	12/07/2009		4J⁽¹⁾		2,800	11/16/2012	11/16/2017	Common Stock	2,800	⁽¹⁾	13,306	D
Warrants	$2.5⁽⁴⁾						11/07/2006	12/08/2014⁽⁴⁾	Common Stock	2,106		13,306	D
Warrant	⁽⁵⁾						⁽⁵⁾	11/16/2017	Common Stock	11,200		13,306	D
Options	$1.5						05/09/2007	05/09/2012	Common Stock	1,400		7,000	D
Options	$1.5						05/09/2008	05/09/2013	Common Stock	1,400		7,000	D
Options	$1.5						05/09/2009	05/09/2014	Common Stock	1,400		7,000	D
Options	$1.5						05/09/2010	05/09/2015	Common Stock	1,400		7,000	D
Options	$1.5						05/09/2011	05/09/2016	Common Stock	1,400		7,000	D

Explanation of Responses:

1. On August 15, 2008 the shareholders approved an incentive plan which granted warrants to certain officers and directors. The warrants vested over a five year period. On December 8, 2009 the shareholders approved an amendment to the incentive plan to eliminate 218,461 unvested warrants. The amendment further called for 218,461 shares of the company's common stock with a one year restriction on tranfer to be issued.

2. Shares were purchased throughout 2009 at various prices by participation in the AdCare Health Systems Employee Stock Purchase Program.

3. The exercise price of the warrants was based upon the average closing price of the Company's common stock on NYSE-Ames during January 2011 but was not less than $3.00 per share.

4. On December 21, 2009 the warrant holders voted to amend the warrant agreement to decrease the exercise price from $5.40 to $2.50 and to extend the expiration date to 12/8/2014 the fifth anniversary date of the Company's private offering.

5. The exercise of the warrants vested in 2008 was $1.21 per share, those vested in 2009 was $2.25, those vested in 2010 was $3.00 and those vesting in 2011 is $4.00 per share.

	Carol Groeber by power of attorney	02/15/2010
	** Signature of Reporting Person	Date
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