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                                                                     Exhibit 4.2

                         REGISTRATION RIGHTS AGREEMENT

          REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of April
                                               ---------
20, 2001, by and among Vencor, Inc. (to be renamed Kindred Healthcare, Inc.), a
Delaware corporation (the "Company") and the Persons identified on Schedule 1
                           -------
hereto (the "Initial Holders").
             ---------------

                                    RECITALS

A.    Pursuant to the Company's Fourth Amended and Restated Plan of
Reorganization dated as of December 14, 2000 (the "Plan"), upon satisfaction of
certain conditions, the Company will issue New Common Stock and/or New Warrants
(both as defined in the Plan) to the Initial Holders in the amounts set forth on
Schedule 1 hereto.

B.    In order to induce the Initial Holders to agree to the Plan, the Company
has agreed to grant certain securities registration rights to the Initial
Holders as set forth herein.
                                   AGREEMENTS

          In consideration of the premises and the mutual covenants herein
contained and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto hereby agree as follows:

1.  Definitions and General Interpretive Principles.  In addition to the defined
    -----------------------------------------------
terms set forth in the Plan that are not otherwise defined herein (which shall
have the same meanings herein as in the Plan) and to the capitalized terms
defined elsewhere in this Agreement, the following capitalized terms shall have
the following meanings when used in this Agreement:

          "Adverse Disclosure" means public disclosure of material non-public
           ------------------
information, which disclosure in the good faith judgment of the chief executive
officer or chief financial officer of the Company (i) would be required to be
made in any registration statement filed with the Commission by the Company so
that such registration statement would not be materially misleading; (ii) would
not be required to be made at such time but for the filing of such registration
statement; and (iii) the Company has a bona fide business purpose for avoiding.

          "Allocation Percentage" has the meaning set forth in Section 3(e).
           ---------------------

          "Commission" means the U.S. Securities and Exchange Commission and any
           ----------
agency succeeding to its functions.

          "Demand Registration" has the meaning set forth in Section 3(a).
           -------------------

          "Demand Suspension" has the meaning set forth in Section 3(c).
           -----------------

          "Expiration Time" means the earlier of (i) April 20, 2003 (the second
           ---------------
anniversary of the Effective Date); provided, however, that the rights and
                                    --------  -------
obligations relating to Piggyback Registrations contained in Section 4 and
Demand Registrations solely as they relate to a Ventas Stockholder Distribution
contained in Section 3 (and the provisions of this Agreement
<PAGE>

specifically related thereto) shall continue until April 20, 2005 (the fourth
anniversary of the Effective Date) and (ii) the first time at which there are no
Holders.

          "Holder" means an Initial Holder or a successor, assignee or
           ------
transferee of an Initial Holder as contemplated by Section 13 hereof, in each
case for so long as such Initial Holder, successor, assignee or transferee holds
Registrable Securities.

          "Included Registrable Securities" has the meaning set forth in Section
           -------------------------------
          4(a).

          "Indemnified Party" has the meaning set forth in Section 8(c).
           -----------------

          "Indemnifying Party" has the meaning set forth in Section 8(c).
           ------------------

          "Loss" has the meaning set forth in Section 8(a).
           ----

          "NASD" means the National Association of Securities Dealers, Inc.
           ----

          "New Warrant Stock" means any New Common Stock or other security of
           -----------------
the Company or any successor entity issued or issuable upon exercise of any New
Warrant.

          "Participant" has the meaning set forth in Section 8(a).
           -----------

          "Person" means a natural person, a partnership, a corporation, a
           ------
limited liability company, an association, a joint stock company, a trust, a
joint venture, an unincorporated organization or other entity, or a governmental
entity or any department, agency or political subdivision thereof.

          "Piggyback Registration" has the meaning set forth in Section 4(a).
           ----------------------

          "Registrable Securities" means (i) the New Common Stock, (ii) the New
           ----------------------
Warrants and (iii) the New Warrant Stock issuable upon exercise of the New
Warrants, in each case including any securities of the Company or any successor
entity that may be issued or distributed in respect thereof by way of stock
dividend, stock split or other distribution, consolidation, reclassification or
any similar transaction; provided, however, that the foregoing securities shall
                         --------  -------
cease to be "Registrable Securities" to the extent that (i) a registration
statement with respect to the sale of such securities has been declared
effective under the Securities Act and such securities have been disposed of
pursuant to such registration statement, (ii) such securities have been disposed
of pursuant to and in accordance with Rule 144 (or any similar provision then in
force) under the Securities Act or (iii) such securities may be disposed of
pursuant to Rule 144(k) (or any similar provision then in force) under the
Securities Act.  For purposes of this Agreement, any reference to a percentage
(or a majority in number) of Registrable Securities shall mean that percentage
of Registrable Securities, collectively, computed on the assumption that all
such New Warrants were exercised.

          "Securities Act" means the Securities Act of 1933, as amended, and the
           --------------
rules and regulations of the Commission promulgated thereunder.

                                       2
<PAGE>

          "Securities Exchange Act" means the Securities Exchange Act of 1934,
           -----------------------
as amended, and the rules and regulations of the Commission promulgated
thereunder.

          "Shelf Period" has the meaning set forth in Section 2(b).
           ------------

          "Shelf Registration" means a registration effected pursuant to Section
           ------------------
          2.

          "Shelf Registration Statement" means a registration statement of the
           ----------------------------
Company filed with the Commission on Form S-1 or, if available, Form S-3 (or any
successors thereto) for an offering to be made on a continuous or delayed basis
pursuant to Rule 415 under the Securities Act (or any similar rule that may be
adopted by the Commission) covering all of the Registrable Securities requested
to be included by the Initial Holders.

          "Shelf Suspension" has the meaning set forth in Section 2(c).
           ----------------

          "Underwritten Offering" means an offering registered under the
           ---------------------
Securities Act in which securities of the Company are sold to an underwriter on
a firm commitment basis for reoffering to the public.

          "Ventas" means Ventas Realty, Limited Partnership and/or one or more
           ------
trusts established for the benefit of the stockholders of Ventas, Inc. (the

"Trust").  For purposes of requesting a Demand Registration pursuant to Section
------
3 hereof, either Ventas Realty, Limited Partnership or the Trust (but not both)
shall be deemed an Initial Holder.

          "Ventas Stockholder Distribution" means a pro rata distribution by
           -------------------------------
Ventas, Inc. of Registrable Securities held by Ventas, Inc. solely to its
beneficial owners.

          Whenever used in this Agreement, except as otherwise expressly
provided or unless the context otherwise requires, any noun or pronoun shall be
deemed to include the plural as well as the singular and to cover all genders.
The name assigned this Agreement and the section captions used herein are for
convenience of reference only and shall not be construed to affect the meaning,
construction or effect hereof.  Unless otherwise specified, the terms "hereof,"
"herein," "hereunder" and similar terms refer to this Agreement as a whole, and
references herein to Sections refer to Sections of this Agreement.

2.  Shelf Registration
    ------------------
(a)  Filing.  Subject to Section 2(c), as soon as practicable after the
     ------
Effective Date, but in no event later than 120 days following the Effective
Date, the Company shall file with the Commission a Shelf Registration Statement
relating to the offer and sale of Registrable Securities by the Holders thereof
from time to time in accordance with (i) the reasonable and customary methods of
distribution elected by such Holders (including one or more Underwritten
Offerings) and (ii) in order to permit a Ventas Stockholder Distribution, in
each case as set forth in such Shelf Registration Statement, and shall use its
reasonable best efforts to cause such Shelf Registration Statement to be
declared effective under the Securities Act as soon as practicable thereafter.

                                       3
<PAGE>

(b)  Continued Effectiveness.  Subject to Section 2(c), the Company shall use
     -----------------------
its reasonable best efforts to keep the Shelf Registration Statement
continuously effective in order to permit any prospectus that forms a part
thereof to be usable by Holders until the Expiration Time (such period
being the "Shelf Period"), provided that the Shelf Period shall be subject
           ------------    --------
to extension in accordance with Section 6(c).

(c)  Delay in Filing; Suspension of Registration.  If the filing, initial
     -------------------------------------------
effectiveness or continued effectiveness of the Shelf Registration Statement at
any time would require the Company to make an Adverse Disclosure or would
require the inclusion in such Shelf Registration Statement of audited financial
statements that are unavailable to the Company for reasons beyond its reasonable
control, the Company may, upon giving prompt written notice (but in any event
within five (5) days of determination) of such action to the Holders, delay the
filing or initial effectiveness of, or suspend use of, the Shelf Registration
Statement for the shortest period of time determined in good faith by the
Company to be necessary for such purpose (a "Shelf Suspension"); provided,
                                             ----------------    --------
however, that the Company shall not be permitted to exercise a Shelf Suspensio
-------
(i) more than three times during any twenty-four (24) month period, (ii) for a
period exceeding ninety (90) days on any one occasion, or (iii) for an aggregate
period exceeding one hundred twenty (120) days in any twelve (12) month period.
In the event of a Shelf Suspension, the Holders agree to suspend, immediately
upon their receipt of the notice referred to above, any sale or offer to sell
the Registrable Securities, and the use of the prospectus related to the Shelf
Registration in connection with any such sale or offer to sell Registrable
Securities, and agree not to disclose to any other Person the fact that the
Company has exercised a Shelf Suspension or any related facts. The Company shall
promptly (but in any event within five (5) days) notify the Holders upon the
termination of any Shelf Suspension.


(d)  Underwritten Offering.  If the Holders holding not less than a majority of
     ---------------------
the Registrable Securities included in the Shelf Registration Statement so elect
by written request to the Company, such Holders may conduct an offering in the
form of an Underwritten Offering and the Company, if necessary, shall amend or
supplement the Shelf Registration Statement for such purpose. The Holders
holding a majority of the Registrable Securities included in such Underwritten
Offering shall, after consulting with the Company, have the right to select the
managing underwriter or underwriters for the offering, subject to the right of
the Company to approve such managing underwriter or underwriters (which approval
shall not be unreasonably withheld) and to select one co-managing underwriter
reasonably acceptable to such Holders.


(e)  Effect on Demand Registration Obligation.  The provisions of Section 3 of
     ----------------------------------------
this Agreement shall not apply at any time that the Company maintains the
effectiveness of a Shelf Registration Statement and is otherwise complying with
its obligations under this Section 2 with respect to all Registrable Securities.

3.  Demand Registrations.
    --------------------
(a)  Demand by Holders.
     -----------------

(i)  Subject to Section 2(e), each Initial Holder may make a written request to
the Company for registration of all or any part of the Registrable Securities
held by such requesting Holder; provided that the estimated market value of the
                                --------
Registrable Securities to

                                       4
<PAGE>

be so registered is at least $10 million in the aggregate or not less than 5% of
the Registrable Securities; and provided further that Ventas shall be entitled
                                -------- -------
to request a Demand Registration with respect to a Ventas Stockholder
Distribution without regard to the dollar or percentage limits set forth above.
Any such requested registration shall hereinafter be referred to as a "Demand
                                                                       ------
Registration."  Each request for a Demand Registration shall specify the
------------
aggregate amount of Registrable Securities to be registered and the intended
methods of disposition thereof.


        (ii)   Within ten (10) days following receipt of any request for a
Demand Registration, the Company shall deliver written notice of such request to
all other Holders of Registrable Securities. Thereafter, subject to Section
3(e), the Company shall include in such Demand Registration any additional
Registrable Securities which the Holder or Holders thereof have requested in
writing be included in such Demand Registration, provided that all requests
                                                 --------
therefor have been received by the Company within ten (10) days of the Company's
having given the applicable notice to such Holder or Holders. All such requests
shall specify the aggregate amount of Registrable Securities to be registered
and the intended method or methods of distribution of the same. The Company also
may elect to include in such registration additional securities of the Company
to be registered thereunder, including securities to be sold for the Company's
own account or for the account of Persons who are not Holders.

        (iii)  As promptly as practicable following receipt of a request for a
Demand Registration, but in no event later than the later of (x) 180 days
following the Effective Date and (y) 60 days following receipt by the Company of
such request, the Company shall, subject to the terms hereof and applicable law,
use its reasonable best efforts to file a registration statement relating to
such Demand Registration and shall use its reasonable best efforts to cause such
registration statement to be declared effective under the Securities Act as soon
as practicable thereafter and to keep such registration statement effective for
not less than ninety (90) days (or such shorter period during which a prospectus
is required to be delivered under the Securities Act).


(b)  Limitation on Demand Registrations; Effective Registration.  In no event
     ----------------------------------------------------------
shall the Company be required to effect more than one Demand Registration
requested by any Initial Holder. In addition, the Company shall not be required
to file a registration statement for a Demand Registration (i) at any time
during the 120-day period following the effective date of another such
registration statement (other than a registration statement relating solely to a
Ventas Stockholder Distribution), or (ii) during the period commencing on the
seventh day prior to the effective date of an offering by the Company that is
registered under the Securities Act and ending on the ninetieth day after such
offering is completed, provided that, solely with respect to a Ventas
                       --------
Stockholder Distribution, Ventas shall have been afforded the opportunity to
participate in such offering in accordance with the provisions of Section 4
hereof. A registration will not count as a Demand Registration hereunder until
the related registration statement becomes effective and has remained effective
for the period of time specified in Section 3(a)(iii).


(c)  Suspension of Registration.  If the filing, initial effectiveness or
     --------------------------
continued use of a registration statement in respect of a Demand Registration at
any time would require the Company to make an Adverse Disclosure or would
require the inclusion in such registration statement of audited financial
statements that are unavailable to the Company for reasons beyond

                                       5
<PAGE>

the Company's reasonable control, the Company may, upon giving prompt written
notice (but in any event within five (5) days of determination) of such action
to the Holders holding Registrable Securities included or proposed to be
included in such Demand Registration, delay the filing or initial effectiveness
of, or suspend use of, such registration statement for the shortest period of
time determined in good faith by the Company to be necessary for such purpose
a "Demand Suspension"); provided, however, that the Company shall not be
   -----------------    --------  -------
permitted to exercise a Demand Suspension (i) more than three times during any
twenty-four (24) month period, (ii) for a period exceeding ninety (90) days on
any one occasion, or (iii) for an aggregate period exceeding one hundred twenty
(120) days in any twelve (12) month period. In the event of a Demand Suspension,
the Holders agree to suspend, immediately upon their receipt of the notice
referred to above, any sale or offer to sell the Registrable Securities, and the
use of the prospectus related to the Demand Registration in connection with any
such sale or offer to sell Registrable Securities, and agree not to disclose to
any other Person the fact that the Company has exercised a Demand Suspension or
any related facts. The Company shall promptly (but in any event within five (5)
days) notify the Holders holding Registrable Securities affected by any Demand
Suspension upon the termination of such Demand Suspension.


(d)  Underwritten Offering.  If the Holders holding not less than a majority of
     ---------------------
the Registrable Securities included in any offering pursuant to a Demand
Registration so elect by written request to the Company, such offering shall be
in the form of an Underwritten Offering. Holders holding a majority of the
Registrable Securities included in such Underwritten Offering shall, after
consulting with the Company, have the right to select the managing underwriter
or underwriters for the offering, subject to the right of the Company to approve
such managing underwriter or underwriters (which approval shall not be
unreasonably withheld) and to select one co-managing underwriter reasonably
acceptable to such Holders.


(e)  Priority of Securities Registered Pursuant to Demand Registrations.  If the
     ------------------------------------------------------------------
managing underwriter or underwriters of a proposed offering of Registrable
Securities included in a Demand Registration inform the Holders of such
Registrable Securities and the Company in writing that, in its or their opinion,
the number of securities requested to be included in such Demand Registration
(including securities of the Company for its own account or for the account of
other Persons which are not Holders) exceeds the number which can be sold in
such offering without being likely to have an adverse effect on the price,
timing or distribution of the securities offered or the market for the
securities offered, the Company will include in such registration all of the
Registrable Securities sought to be registered therein by the Holders and only
such lesser number of other securities requested to be included for the account
of the Company or for the account of other Persons which are not Holders as
shall not, in the opinion of the managing underwriter or underwriters, be likely
to have such an effect. In the event that, despite the reduction of the number
of securities to be offered for the account of the Company or for the account of
Persons which are not Holders in such registration pursuant to the immediately
preceding sentence, the number of Registrable Securities to be included in such
registration exceeds the number which, in the opinion of the managing
underwriter or underwriters, can be sold without having the adverse effect
referred to above, the number of Registrable Securities that can be included
without having such an adverse effect shall be allocated pro rata among the
                                                         --- ----
Holders which have requested participation in the Demand Registration (based,
for each such Holder, on the percentage derived by dividing (i) the number of
Registrable Securities which such Holder has requested to include in such Demand
Registration by (ii) the aggregate number

                                       6
<PAGE>

of Registrable Securities which all such Holders have requested to
include (such Holder's "Allocation Percentage")).  Notwithstanding the
                        ---------------------
foregoing, if more than 50% of the Registrable Securities of a Holder
requested to be registered pursuant to a Demand Registration under this
Section 3 are excluded from such Demand Registration, then the Holder
having such securities excluded (an "Excluded Holder") shall have the right
                                     ---------------
to withdraw all, or any number, of their Registrable Securities from inclusion
in such Demand Registration no later than 20 days prior to its effectiveness. If
less than 80% of the aggregate Registrable Securities requested to be included
in such Demand Registration by an Initial Holder are actually included therein,
such registration will not count as a Demand Registration of such Initial Holder
for purposes of this Section 3. Notwithstanding the foregoing, no Registrable
Securities to be distributed pursuant to a Ventas Stockholder Distribution shall
be excluded from a Demand Registration by virtue of this Section 3(e).

          (f)  Registration Statement Form.  Registrations under this Section 3
               ---------------------------
shall be on such appropriate registration form of the Commission (i) as shall be
selected by the Company and as shall be reasonably acceptable to the Holders
holding a majority of Registrable Securities requesting participation in the
Demand Registration and (ii) as shall permit the disposition of the Registrable
Securities in accordance with the intended method or methods of disposition
specified in the applicable Holders' requests for such registration.

          4.   Piggyback Registrations.
               -----------------------

          (a)  Participation.

          (i)  If the Company at any time proposes to file a registration
statement with respect to any offering of equity securities for its own account
or for the account of any holders of its securities (other than (A) a
registration under Section 2 hereof, (B) a registration on Form S-4 or S-8 or
any successor form to such forms or (C) a registration on any registration form
which does not permit secondary sales or does not include substantially the same
information as would be required to be included in a registration statement
covering the sale of Registrable Securities (other than information as to the
selling stockholders and their intended method or methods of disposition)),
then, as soon as practicable (but in no event less than fifteen (15) days prior
to the proposed date of filing such registration statement with the Commission),
the Company shall give written notice of such proposed filing to all Holders of
Registrable Securities and such notice shall offer the Holders the opportunity
to register such number of Registrable Securities as each such Holder may
request in writing (a "Piggyback Registration"). Subject to Section 4(b), the
Company shall include in such registration statement all such Registrable
Securities with respect to which the Company has received written requests for
inclusion therein within ten (10) days after the Company's notice has been given
("Included Registrable Securities").  If at any time after giving written
 ---------------------------------
notice of its intention to register any equity securities and prior to the
effective date of the registration statement filed in connection with such
registration, the Company shall determine for any reason not to register or to
delay registration of such equity securities, the Company may, at its election,
give written notice of such determination to each Holder holding Included
Registrable Securities and, (x) in the case of a determination not to register,
shall be relieved of its obligation to register any Included Registrable
Securities in connection with such registration, and (y) in the case of a
determination

                                       7
<PAGE>

to delay registering, shall be permitted to delay registering any Included
Registrable Securities for the same period as the delay in registering such
other equity securities.

        (ii) If the offering pursuant to a Piggyback Registration is to be an
Underwritten Offering, then each Holder making a request for its Registrable
Securities to be included therein must, and the Company shall use its reasonable
best efforts to make such arrangements with the underwriters so that each such
Holder may, participate in such Underwritten Offering on the same terms as other
Persons selling securities in such Underwritten Offering. If the offering
pursuant to such registration is to be on any other basis, then each Holder
making a request for a Piggyback Registration pursuant to this Section 4(a) must
participate in such offering on such basis. Notwithstanding any provision in
this Agreement to the contrary, any Holder participating through a Piggyback
Registration shall have no right to change the intended method or methods of
disposition otherwise applicable, other than to include provisions reasonably
necessary to effect a Ventas Stockholder Distribution.


       (b) Priority of Piggyback Registration.  If the managing underwriter
           ----------------------------------
or underwriters of any proposed offering of securities included in a Piggyback
Registration informs the Holders holding Included Registrable Securities in
writing that, in its or their opinion, the total number of securities which such
Holders and any other Persons intend to include in such offering exceeds the
number which can be sold in such offering without being likely to have an
adverse effect on the price, timing or distribution of the securities offered or
the market for the securities offered, then the securities to be included in
such registration shall be allocated as follows:

(i)   first, 100% of the securities that the Company or any Person exercising a
      -----
      contractual right to demand registration has proposed to sell shall be
      included therein;

(ii)  second, and only if all the securities referenced in clause (i) have been
      ------
      included, the number of Included Registrable Securities that, in the
      opinion of such underwriter or underwriters, can be sold without having
      such adverse effect shall be included therein, with such number to be
      allocated pro rata among the Holders of Included Registrable Securities
                --- ----
      (based, for each such Holder, on such Holder's Allocation Percentage);
      provided, however, that if as a result of the provisions of this Section
      --------  -------
      4(b), any Holder shall not be entitled to include at least 50% of such
      Holder's Included Registrable Securities, such Holder may withdraw such
      Holder's request to include all, or any number of such Registrable
      Securities in such registration statement no later than 20 days prior to
      its effectiveness; and

(iii) third, and only if all of the Registrable Securities referenced in
      -----
      clauses (i) and (ii) have been included, any other equity securities
      eligible for inclusion in such registration which, in the opinion of such
      underwriters, can be sold without having such adverse effect shall be
      included therein.

                                       8
<PAGE>

5.  Black-out Periods
    -----------------

          (a) Black-out Periods for Holders.  In the event of (i) a registration
              -----------------------------
by the Company involving the offering and sale by the Company of its equity
securities or securities convertible into or exchangeable for its equity
securities or (ii) an Underwritten Offering involving the offering and sale by
Holders of Registrable Securities, the Holders agree, if requested by the
Company (or, in the case of any Underwritten Offering, by the managing
underwriter or underwriters) and provided that the Company has complied with its
obligations under Section 4, not to effect any public sale or distribution
(including any sale pursuant to Rule 144 under the Securities Act) of any
securities of the Company (except, in each case, as part of the applicable
registration, if permitted, and provided that, solely with respect to a Ventas
Stockholder Distribution, Ventas shall have been afforded the opportunity to
participate in such offering in accordance with the provisions of Section 4
hereof) which securities are the same as or similar to those being registered in
connection with such registration, or which are convertible into or exchangeable
or exercisable for such securities, during the period beginning seven (7) days
before and ending 90 days (or such lesser period as may be permitted by the
Company or such managing underwriters) after, the effective date of the
registration statement filed in connection with such registration, to the extent
such Holders are timely notified in writing by the Company or the managing
underwriter or underwriters.

          (b) Black-out Periods for the Company.  In the event of a registration
              ---------------------------------
of Registrable Securities pursuant to Section 2 or Section 3 hereof, the Company
agrees, if requested by the Holders holding a majority of the Registrable
Securities to be sold pursuant to such registration (or, in the case of an
Underwritten Offering, by the managing underwriter or underwriters in such
Underwritten Offering), not to effect any public sale or distribution of any
securities of the Company which are the same as or similar to those being
registered, or which are convertible into or exchangeable or exercisable for
such securities, during the period beginning seven (7) days before, and ending
90 days (or such lesser period as may be permitted by such Holders or such
underwriter or underwriters) after, the effective date of the registration
statement filed in connection with such registration (or, in the case of an
Underwritten Offering under the Shelf Registration, the date of the closing
under the underwriting agreement in connection therewith), to the extent the
Company is timely notified in writing by such Holders or such underwriter or
underwriters.  Notwithstanding the foregoing, the Company may effect a public
sale or distribution of securities of the type described above and during the
periods described above if the same (A) is made pursuant to a registration on
Form S-4 or S-8 or any successor form to such forms or (B) in connection with a
direct or indirect acquisition, merger or other business combination by the
Company of or with another Person.

6.  Registration Procedures.
    -----------------------

          (a) In connection with the Company's registration obligations pursuant
to this Agreement, the Company shall, subject to the limitations set forth
herein, use its reasonable best efforts to effect any such registration so as to
permit the sale of the applicable Registrable Securities in accordance with the
intended method or methods of distribution thereof as expeditiously as
reasonably practicable and, in any event, in conformity with any required time
period set forth herein, and in connection therewith the Company shall:

              (i)    before filing a registration statement or prospectus with
the Commission, or any amendments or supplements thereto, furnish to the
underwriter or

                                       9
<PAGE>

underwriters, if any, and to the Holders holding Registrable Securities included
in such registration statement, copies of all documents prepared to be filed, w
hich documents shall be subject to the reasonable review and comment of such
Holders, such underwriters, if any, and their respective counsel;

              (ii)   prepare and file with the Commission a registration
statement relating to the registration on any appropriate form under the
Securities Act, which form shall be available for the sale of the Registrable
Securities;

             (iii)   prepare and file with the Commission such amendments or
supplements to the applicable registration statement or prospectus used in
connection therewith as may be (A) reasonably requested by any participating
Holder (to the extent such request relates to information relating to such
Holder), (B) necessary to keep such registration effective for the period of
time required by this Agreement or (C) necessary to comply with the applicable
provisions of Rules 424 and 430A under the Securities Act;


             (iv)    notify the selling Holders and the managing underwriter or
underwriters, if any, as soon as reasonably practicable after notice thereof is
received by the Company (A) when the applicable registration statement or any
amendment thereto has been filed or becomes effective and when the applicable
prospectus or any amendment or supplement thereto has been filed, (B) of any
written comments by the Commission or any request by the Commission for
amendments or supplements to such registration statement or prospectus or for
additional information, (C) of the issuance by the Commission of any stop order
suspending the effectiveness of such registration statement or any order
preventing or suspending the use of any preliminary or final prospectus or the
initiation or threat of any proceedings for such purposes and (D) of the receipt
by the Company of any notification with respect to the suspension of the
qualification of the Registrable Securities for offering or sale in any
jurisdiction or the initiation or threat of any proceeding for such purpose;


             (v)     promptly notify each selling Holder and the managing
underwriter or underwriters, if any, when the Company becomes aware of the
occurrence of any event as a result of which the applicable registration
statement or prospectus (as then in effect) contains any untrue statement of a
material fact or omits to state a material fact necessary to make the statements
therein (in the case of the prospectus and any preliminary prospectus, in light
of the circumstances under which they were made) not misleading or, if for any
other reason it shall be necessary to amend or supplement such registration
statement or prospectus in order to comply with the Securities Act and, in
either case as promptly as reasonably practicable thereafter, prepare and file
with the Commission a post-effective amendment or supplement to such
registration statement or prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter delivered
to the purchasers of Registrable Securities, the prospectus shall not contain an
untrue statement of a material fact or omit to state any material fact necessary
to make the statements therein not misleading;

             (vi)    make every reasonable effort to prevent or obtain at the
earliest possible moment the withdrawal of any stop order with respect to the
applicable registration statement or other order suspending the use of any
preliminary or final prospectus;

                                       10
<PAGE>

             (vii)   promptly incorporate in a prospectus supplement or post-
effective amendment to the applicable registration statement such information as
the managing underwriter or underwriters, if any, or the Holders holding a
majority of the Registrable Securities being sold agree should be included
therein (or, in the case of a Ventas Stockholder Distribution, by Ventas)
relating to the plan of distribution with respect to such Registrable
Securities, the amount of Registrable Securities being distributed and the
purchase price being paid therefor; and make all required filings of such
prospectus supplement or post-effective amendment as soon as reasonably
practicable after being notified of the matters to be incorporated in such
prospectus supplement or post-effective amendment;

             (viii)  furnish to each selling Holder and each managing
underwriter, if any, without charge, as many conformed copies as such Holder or
managing underwriter may reasonably request of the applicable registration
statement, including all documents incorporated by reference therein or exhibits
to such registration statement;

             (ix)    deliver to each selling Holder and each managing
underwriter, if any, without charge, as many copies of the applicable prospectus
(including each preliminary prospectus) as such Holder or managing underwriter
may reasonably request (it being understood that the Company consents to the use
of the prospectus by each of the selling Holders and the underwriter or
underwriters, if any, in connection with the offering and sale of the
Registrable Securities covered by the prospectus);

             (x)     on or prior to the date on which the applicable
registration statement is declared effective, use its reasonable best efforts to
register or qualify such Registrable Securities for offer and sale under the
securities or "Blue Sky" laws of each state and other jurisdiction of the United
States, as any such selling Holder or underwriter, if any, or their respective
counsel reasonably and timely requests in writing, and do any and all other acts
or things reasonably necessary or advisable to keep such registration or
qualification in effect so as to permit the commencement and continuance of
sales and dealings in such jurisdictions for as long as may be necessary to
complete the distribution of the Registrable Securities covered by the
registration statement; provided that the Company shall not be required (A) to
                        --------
qualify generally to do business in any jurisdiction where it is not then so
qualified, (B) to take any action which would subject it to taxation or general
service of process in any such jurisdiction where it is not then so subject or
(C) make any change in its charter or by-laws that the board of directors of the
Company determines in good faith to be contrary to the best interests of the
Company and its stockholders;

             (xi)    cooperate with the selling Holders and the managing
underwriter, underwriters or agent, if any, to facilitate the timely preparation
and delivery of certificates representing Registrable Securities to be sold and
not bearing any restrictive legends;

             (xii)   not later than the effective date of the applicable
registration statement, provide a CUSIP number for all Registrable Securities
included in such registration statement and provide the applicable transfer
agent with printed certificates for the Registrable Securities, which
certificates shall be in a form eligible for deposit with The Depository Trust
Company;

                                       11
<PAGE>

             (xiii)  obtain for delivery to the underwriter or underwriters, if
any, with copies to the Holders included in such registration, an opinion or
opinions from counsel for the Company dated the effective date of the
registration statement or, in the event of an Underwritten Offering, the date of
the closing under the underwriting agreement, in customary form, scope and
substance;

             (xiv)   in the case of an Underwritten Offering, obtain for
delivery to the Company and the underwriter or underwriters, if any, with copies
(subject to the reasonable consent of the certified public accountants referred
to below, determined in accordance with market practice) to the Holders included
in such registration, a comfort letter from the Company's independent certified
public accountants in customary form and covering such matters of the type
customarily covered by comfort letters and as the managing underwriter or
underwriters reasonably request, dated the date of execution of the underwriting
agreement and brought down to the closing under the underwriting agreement;

             (xv)    reasonably cooperate with each selling Holder of
Registrable Securities and each underwriter or agent, if any, participating in
the disposition of such Registrable Securities and their respective counsel in
connection with any filings required to be made with the NASD;

             (xvi)   use its reasonable best efforts to comply with all
applicable rules and regulations of the Commission and make generally available
to its securityholders such information (financial or otherwise) as may be
required thereunder;

             (xvii)  provide and cause to be maintained a transfer agent and
registrar for all Registrable Securities covered by the applicable registration
statement from and after a date not later than the effective date of such
registration statement;

             (xviii) cause all Registrable Securities covered by the applicable
registration statement to be listed on each securities exchange on which any of
the Company's securities of such class are then listed or quoted and on each
inter-dealer quotation system on which any of the Company's securities of such
class are then quoted; and

             (xix)   make available upon reasonable notice at reasonable times
and for reasonable periods for inspection by each Initial Holder and a
representative appointed by the Holders holding a majority of the Registrable
Securities covered by the applicable registration statement, by any managing
underwriter or underwriters participating in any disposition to be effected
pursuant to such registration statement and by any attorney, accountant or other
agent retained by such Holders or any such managing underwriter, all pertinent
financial and other records, pertinent corporate documents and properties of the
Company as shall be reasonably necessary to enable them to exercise their due
diligence responsibility, and cause all of the Company's officers, directors and
employees and the independent public accountants who have certified its
financial statements to make themselves available upon reasonable notice at
reasonable times and for reasonable periods to discuss the business of the
Company and to supply all information reasonably requested by any such seller,
underwriter, attorney, accountant or agent in connection with such registration
statement as shall be reasonably necessary to enable them to exercise their due
diligence responsibility (subject to the entry by each party referred to

                                       12
<PAGE>

in this clause (xix) into a customary confidentiality agreement in a form
reasonably acceptable to the Company).


          (b) The Company may require each selling Holder as to which any
registration is being effected to furnish to the Company such information
regarding itself, the Registrable Securities held by it, the distribution of
such Holder's Registrable Securities and such other information relating to such
Holder and its ownership of the applicable Registrable Securities as the Company
may from time to time reasonably request, including without limitation
information required under Item 507 of Regulation S-K and other information
necessary to effect a registration with respect to a Ventas Stockholder
Distribution.  Each Holder agrees to furnish such information to the Company and
to cooperate with the Company as necessary to enable the Company to comply with
the provisions of this Agreement.  The Company shall have the right to exclude
any Holder that does not comply with the preceding sentence from the applicable
registration.

          (c) Each Holder agrees by acquisition of its Registrable Securities
that, upon receipt of any notice from the Company of the occurrence of any event
of the kind described in Section 6(a)(v), such Holder shall discontinue
disposition of its Registrable Securities pursuant to such registration
statement until such Holder's receipt of the copies of the supplemented or
amended prospectus contemplated by Section 6(a)(v) and of any additional or
supplemental filings that are incorporated by reference in the prospectus, or
until such Holder is advised in writing by the Company that the use of the
prospectus may be resumed, and has received copies and, if so directed by the
Company, such Holder shall deliver to the Company (at the Company's expense) all
copies, other than permanent file copies then in such Holder's possession, of
the prospectus covering such Registrable Securities which are current at the
time of the receipt of such notice.  In the case of the Shelf Registration
Statement, in the event the Company shall give any such notice, the Shelf Period
shall be extended by the number of days in the period from and including the
date of the giving of such notice in accordance with Section 16 and pursuant to
this Section 6(c) to but not including the date when each Holder of Registrable
Securities covered by the Shelf Registration Statement shall have received
copies of the supplemented or amended prospectus contemplated by Section
6(a)(v), and the restrictions of this Section 6(c) shall no longer be
applicable.

7.  Registration Expenses.  The Company shall pay all expenses incident to its
    ---------------------
performance or compliance with its obligations under this Agreement, including
without limitation: (i) all registration and filing fees, and any other fees and
expenses associated with filings required to be made with the Commission or the
NASD, (ii) all fees and expenses of compliance with federal and state securities
or "Blue Sky" laws, (iii) all of its printing, duplicating, word processing,
messenger, telephone, facsimile and delivery expenses (including expenses of
printing certificates for the Registrable Securities in a form eligible for
deposit with The Depository Trust Company and of printing prospectuses), (iv)
all fees and disbursements of counsel for the Company and of all independent
certified public accountants of the Company, (v) Securities Act liability
insurance or similar insurance if the Company so desires, (vi) all fees and
expenses incurred in connection with the listing of the Registrable Securities
on any securities exchange or the quotation of the Registrable Securities on any
inter-dealer quotation system, (vii) the reasonable fees and expenses of one
counsel for all Holders (selected by the Holders of a majority of the
Registrable Securities included in a registration) in an amount not to exceed

                                       13
<PAGE>

$50,000 and (viii) all road show costs and expenses not paid for by the
underwriters.  In addition, the Company shall pay its internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), the expense of any audit and
the fees and expenses of any Person, including special experts, retained by the
Company.  The Company shall not be required to pay (w) any other costs or
expenses in the course of the transactions contemplated hereby, (x) any expenses
incurred by the Holders (except as provided in clauses (i), (ii) and (vii) of
the preceding sentence), (y) any underwriting discounts or commissions or
transfer taxes attributable to the sale of Registrable Securities or (z) any
fees and expenses of counsel to the underwriters.

8.  Indemnification.
    ---------------

          (a) Indemnification by the Company.  The Company agrees to indemnify
              ------------------------------
and hold harmless, to the fullest extent permitted by law, each Holder selling
Registrable Securities and its respective officers, directors, partners and
employees and each Person who controls (within the meaning of the Securities Act
or the Securities Exchange Act) such selling Holder (each, a "Participant") from
                                                              -----------
and against any and all losses, claims, damages, judgments, liabilities and
expenses (including reasonable costs of investigation and legal expenses) caused
by, arising out of or based upon (i) any untrue or alleged untrue statement of a
material fact contained in any registration statement under which such
Registrable Securities were registered under the Securities Act (including any
final, preliminary or summary prospectus contained therein or any amendment
thereof or supplement thereto or any documents incorporated by reference
therein) or (ii) any omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
(in the case of a prospectus or preliminary prospectus, in light of the
circumstances under which they were made) not misleading (each, a "Loss" and
                                                                   ----
collectively "Losses"); provided, however, that the Company shall not be liable
              ------    --------  -------
to any Participant in any such case to the extent that any such Loss is caused
by written information furnished to the Company by such Holder expressly for use
in the preparation thereof , or if such untrue statement or alleged untrue
statement or omission or alleged omission is corrected in an amendment or
supplement to such prospectus which has been made available to the Holders and
the relevant Holder fails to deliver such prospectus as so amended or
supplemented, if such delivery is required under applicable law or the
applicable rules of any securities exchange, prior to or concurrently with the
sales of the Registrable Securities to the Person asserting such Loss.  This
indemnity shall be in addition to any liability the Company may otherwise have.

          (b) Indemnification by the Holders.  Each selling Holder agrees
              ------------------------------
(severally and not jointly) to indemnify and hold harmless, to the fullest
extent permitted by law, the Company, its directors, officers and employees and
each Person who controls the Company (within the meaning of the Securities Act
and the Securities Exchange Act) from and against any and all Losses to the
extent, but only to the extent, that any such Loss is caused by, arises out of
or is based upon any information furnished in writing by such selling Holder to
the Company specifically for inclusion in any registration statement under which
such Registrable Securities were registered under the Securities Act (including
any final, preliminary or summary prospectus contained therein or any amendment
thereof or supplement thereto or any documents incorporated by reference
therein) and was not corrected in a subsequent writing prior to or concurrently
with the sale of the Registrable Securities to the Person asserting such Loss.

                                       14
<PAGE>

The liability of any Holder under this paragraph shall in no event exceed the
amount by which proceeds received by such Holder from sales of Registrable
Securities giving rise to such obligations exceeds the amount of any Loss which
such Holder has otherwise been required to pay by reason of such untrue
statement or omission.  This indemnity shall be in addition to any liability
such Holder may otherwise have.

          (c) Indemnification Proceedings.  Any Person entitled to
              ---------------------------
indemnification hereunder (an "Indemnified Party") shall (i) give prompt written
                               -----------------
notice to the Person from whom such indemnification may be sought (the
"Indemnifying Party") of any claim with respect to which it seeks
-------------------
indemnification, provided, however, that the failure to so notify the
                 --------  -------
Indemnifying Party shall not relieve it of any obligation or liability which it
may have hereunder or otherwise except to the extent it is materially prejudiced
by such failure, and (ii) permit such Indemnifying Party to assume the defense
of such claim with counsel reasonably satisfactory to the Indemnified Party;
provided, however, that the Indemnified Party shall have the right to select and
--------  -------
employ separate counsel and to participate in the defense of such claim, and the
fees and expenses of such counsel shall be at the expense of the Indemnified
Party unless (A) the Indemnifying Party has agreed in writing to pay such fees
or expenses, (B) the Indemnifying Party shall have failed to assume the defense
of such claim within a reasonable time after having received notice of such
claim from the Indemnified Party and to employ counsel reasonably satisfactory
to the Indemnified Party, (C) in the reasonable judgment of the Indemnified
Party, based upon advice of its counsel, a conflict of interest exists between
the Indemnified Party and the Indemnifying Party with respect to such claims or
(D) the Indemnified Party has reasonably concluded (based on advice of counsel)
that there may be legal defenses available to it or other Indemnified Parties
that are different from or in addition to those available to the Indemnifying
Party (in which case, if the Indemnified Party notifies the Indemnifying Party
in writing that the Indemnified Party elects to employ separate counsel at the
expense of the Indemnifying Party, the Indemnifying Party shall not have the
right to assume the defense of such claim on behalf of the Indemnified Party).
If such defense is assumed by the Indemnifying Party, or if such defense is not
assumed by the Indemnifying Party but the Indemnifying Party acknowledges that
the Indemnified Party is entitled to indemnification hereunder, the Indemnifying
Party shall not be subject to any liability for any settlement made without its
consent, which consent shall not be unreasonably withheld; provided, that an
                                                           --------
Indemnifying Party shall not be required to consent to any settlement involving
the imposition of equitable remedies or involving the imposition of any material
obligations on such Indemnifying Party other than financial obligations for
which such Indemnified Party will be indemnified hereunder.  If the Indemnifying
Party assumes the defense, the Indemnifying Party shall have the right to settle
such action without the consent of the Indemnified Party; provided, that the
                                                          --------
Indemnifying Party shall be required to obtain the consent of the Indemnified
Party (which consent shall not be unreasonably withheld) if the settlement
includes any admission of wrongdoing on the part of the Indemnified Party or any
equitable remedies or restriction on the Indemnified Party or its officers,
directors or employees.  No Indemnifying Party shall consent to entry of any
judgment or enter into any settlement which does not include as an unconditional
term thereof the giving by the claimant or plaintiff to each Indemnified Party
of an unconditional release from all liability in respect of such claim or
litigation.  An Indemnifying Party (or, as the case may be, Indemnifying
Parties) shall not, in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for the reasonable fees, disbursements and
other charges of more than one separate firm admitted to practice in such
jurisdiction at any one time from all Indemnified Parties collectively unless

                                       15
<PAGE>

(x) the employment of more than one counsel has been authorized in writing by
such Indemnifying Party (or Indemnifying Parties) or (y) a conflict exists or
may exist (based on advice of counsel to an Indemnified Party) between such
Indemnified Party and other Indemnified Parties, in each of which cases the
Indemnifying Party (or Indemnifying Parties) shall be obligated to pay the
reasonable fees and expenses of such additional counsel or counsels.  The
indemnification provided for under this Agreement shall remain in full force and
effect regardless of any investigation made by or on behalf of the Indemnified
Party or any officer, director or controlling Person of such Indemnified Party
and shall survive the transfer of Registrable Securities.

          (d) Contribution.  If for any reason the indemnification provided for
              ------------
in paragraphs (a) and (b) of this Section 8 is unavailable to an Indemnified
Party or is insufficient to hold it harmless as contemplated by paragraphs (a)
and (b) of this Section 8, then the Indemnifying Party shall contribute to the
amount paid or payable by the Indemnified Party as a result of such Loss in such
proportion as is appropriate to reflect the relative fault of the Indemnifying
Party on the one hand and the Indemnified Party on the other.  The relative
fault shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Indemnifying Party or the Indemnified Party and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission.  Notwithstanding anything in this Section 8(d) to
the contrary, no Indemnifying Party (other than the Company) shall be required
pursuant to this Section 8(d) to contribute any amount in excess of the amount
by which the net proceeds received by such Indemnifying Party from the sale of
Registrable Securities in the offering to which the Losses of the Indemnified
Parties relate exceeds the amount of any damages which such Indemnifying Party
has otherwise been required to pay by reason of such untrue statement or
omission.  The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 8(d) were determined by pro rata
                                                              --- ----
allocation or by any other method of allocation that does not take account of
the equitable considerations referred to in the preceding sentences.  No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any Person who was
not guilty of such fraudulent misrepresentation.  If indemnification is
available under this Section 8, the Indemnifying Parties shall indemnify each
Indemnified Party to the fullest extent provided in Sections 8(a) and 8(b)
hereof without regard to the relative fault of said Indemnifying Parties or
Indemnified Party.

          (e) Reimbursement.  In addition to, but not in duplication of, the
              -------------
foregoing, each Initial Holder shall be entitled to reimbursement from the
Company for any out-of-pocket losses actually incurred in the event, and only to
the extent, that such Holder suffers such losses as a result of such Holder's
inability to make delivery of sold securities due to the Company's breach of its
commitment to provide timely notice as required by clauses (C) and (D) of
Section 6(a)(iv).

9.  Compliance with Rule 144.  The Company shall file the reports required to be
    ------------------------
filed by it under the Securities Act and the Securities Exchange Act so long as
the Company is obligated to file such reports, and it shall take such further
action as any Holder may reasonably request, all to the extent required from
time to time to enable such Holder to sell Registrable Securities without
registration under the Securities Act within the limitation of the exemptions
provided by (a) Rule 144 under the Securities Act, as such Rule may be amended
from time to

                                       16
<PAGE>

time or (b) any similar rules or regulations hereafter adopted by the
Commission. Upon the written request of any Holder, the Company shall deliver to
such Holder a written statement as to whether it has complied with such
requirements.

10.  Underwriting Agreements.  If requested by the underwriters for any
     -----------------------
Underwritten Offering requested by Holders pursuant to Section 2 or Section 3,
the Company and the Holders of Registrable Securities to be included therein
shall enter into an underwriting agreement with such underwriters, such
agreement to be reasonably satisfactory in substance and form to the Company,
the Holders holding a majority of the Registrable Securities to be included in
such Underwritten Offering and the underwriters, and to contain such terms and
conditions as are generally prevailing in agreements of that type, including,
without limitation, such representations and warranties to, and covenants with,
the underwriters with respect to the business of the Company and its
subsidiaries and the registration statement, prospectus and documents, if any,
incorporated or deemed to be incorporated by reference therein, in each case, as
are customarily made by issuers to underwriters in underwritten offerings of
securities similar to the Registrable Securities, and indemnities no less
favorable to the recipient thereof than those provided in Section 8.  The
Holders holding any Registrable Securities to be included in any Underwritten
Offering pursuant to Section 4 shall enter into such an underwriting agreement
at the request of the Company.  No Holder shall be required in any such
underwriting agreement to make any representations or warranties to or
agreements with the Company or the underwriters other than representations,
warranties or agreements regarding such Holder, such Holder's Registrable
Securities, such Holder's intended method of distribution and any other
representations required by law or as the underwriters may reasonably request;
provided, however, that each Holder agrees to execute customary powers of
--------  -------
attorney, custody agreements and other forms or documents reasonably requested
by the underwriters.

11.  Term.  This Agreement shall terminate at the Expiration Time.  The
     ----
provisions of Section 8, 22 and 23 shall survive any termination.

12.  Amendments and Waivers.  The provisions of this Agreement may be amended or
     ----------------------
waived at any time only by the written agreement of the Company and the Holders
holding a majority of the Registrable Securities; provided, however, that any
                                                  --------  -------
amendment or waiver that adversely effects any Holder or group of Holders
(including without limitation any amendment or waiver to the extent it has an
adverse effect on the ability to effect a Ventas Stockholders Distribution)
shall only be binding on those Holders that have expressly agreed to such
amendment or waiver.  Any amendment or waiver on the part of any such Holders of
any provision or condition of this Agreement must be made in writing and shall
be effective only to the extent specifically set forth in writing.  Any
amendment or waiver effected in accordance with this paragraph shall be binding
upon each Holder and the Company, except as provided in the proviso to the first
sentence of this section.  Each Holder acknowledges that by operation of this
paragraph the Holders holding a majority of the Registrable Securities, acting
in conjunction with the Company, will have the right and power to diminish or
eliminate all rights pursuant to this Agreement, except as provided in the
proviso to the first sentence of this section.

                                       17
<PAGE>

13.  Successors, Assigns and Transferees.
     -----------------------------------

          (a) The registration rights (other than demand registration rights
pursuant to Section 3 hereof; provided, however, that each Initial Holder may
                              --------  -------
transfer and assign all but not less than all of its Registrable Securities to
one entity, in which case such Initial Holder's unexercised Demand Registration
shall also be transferred and assigned) of any Holder under this Agreement with
respect to any Registrable Securities may be transferred and assigned, provided
                                                                       --------
that no such transfer or assignment shall be binding upon or obligate the
Company under this Agreement to any such transferee or assignee unless and until
(i) the Company shall have received notice of such transfer or assignment as
herein provided and a written agreement of the transferee or assignee to be
bound by the provisions of this Agreement and (ii) such transferee or assignee
holds Registrable Securities.  Any transfer or assignment of the rights and
obligations under this Agreement made other than as provided in the first
sentence of this Section 13 shall be null and void.

          (b) This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto, and their respective successors and permitted
assigns.

14.  Final Agreement.  This Agreement constitutes the final agreement of the
     ---------------
parties concerning the matters referred to herein, and supersedes all prior
agreements and understandings.

15.  Severability.  Whenever possible, each provision of this Agreement will be
     ------------
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement is held to be prohibited by or invalid
under applicable law, such provision will be ineffective only to the extent of
such prohibition or invalidity, without invalidating the remainder of this
Agreement.

16.  Notices.  All notices, demands or other communications or documents to be
     -------
given or delivered under or by reason of the provisions of this Agreement shall
be made in writing and shall be deemed to have been received (a) when delivered
personally to the recipient; (b) when sent to the recipient by telecopy (receipt
electronically confirmed by sender's telecopy machine) if during normal business
hours of the recipient, otherwise on the next business day; (c) one business day
after the date when sent to the recipient by reputable express courier service
(charges prepaid), or (d) seven business days after the date when mailed to the
recipient by certified or registered mail, return receipt requested and postage
prepaid.  Such notices, demands and other communications shall be sent to the
parties at the addresses indicated below, or to such other address as any party
hereto may, from time to time, designate in writing delivered pursuant to the
terms of this Section 16:

          If to the Initial Holders, to the addresses set forth on Schedule 1
hereto.

          If to Holders other than the Initial Holders, to the addresses set
forth on the stock record books of the Company.

                                       18
<PAGE>

          If to the Company, to:

               Vencor, Inc. (to be renamed Kindred Healthcare, Inc.)
               680 South Forest Street
               Louisville, KY  40202
               Attention:  General Counsel and Chief Financial Officer
               Fax:  (502) 596-4715

17.  Governing Law; Service of Process; Consent to Jurisdiction.  (a)  THIS
     ----------------------------------------------------------
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED WITHIN THE
STATE.
          (b) To the fullest extent permitted by applicable law, each party
hereto (i) agrees that any claim, action or proceeding by such party seeking any
relief whatsoever arising out of, or in connection with, this Agreement or the
transactions contemplated hereby shall be brought only in the U.S. District
Court for the Southern District of New York and in any New York State court
located in the Borough of Manhattan and not in any other State or Federal court
in the United States of America or any court in any other country, (ii) agrees
to submit to the exclusive jurisdiction of such courts located in the State of
New York for purposes of all legal proceedings arising out of, or in connection
with, this Agreement or the transactions contemplated hereby and (iii)
irrevocably waives any objection which it may now or hereafter have to the
laying of the venue of any such proceeding brought in such a court and any claim
that any such proceeding brought in such a court has been brought in an
inconvenient forum.

18.  Counterparts and Facsimile Execution.  This Agreement may be executed in
     ------------------------------------
any number of counterparts, each of which when so executed and delivered shall
be deemed an original, and such counterparts together shall constitute one
instrument.  This agreement may be executed by the exchange of signatures by
facsimile transmission.  Each party shall receive a duplicate original of the
counterpart copy or copies executed by it  and the Company.

19.  Securities Held by the Company or its Affiliates.  Whenever the consent or
     ------------------------------------------------
approval of Holders of a specified percentage of Registrable Securities is
required hereunder, Registrable Securities held by the Company or any of its
affiliates (as such term is defined in Rule 405 under the Securities Act, but
excluding any Holders of Registrable Securities) shall not be counted in
determining whether such consent or approval was given by the Holders of such
required percentage.

20.  Specific Performance.  Without limiting or waiving in any respect any
     --------------------
rights or remedies of the parties under this Agreement now or hereinafter
existing at law or in equity or by statute, each of the parties hereto shall be
entitled to seek specific performance of the obligations to be performed by the
other(s) in accordance with the provisions of this Agreement.

21.  No Inconsistent Agreements.  (a)  The Company shall not, on or after the
     --------------------------
date of this Agreement, enter into any agreement with respect to its securities
that is inconsistent with the rights granted to the Holders pursuant to this
Agreement or otherwise conflicts with the provisions hereof.  The rights granted
to the Holders hereunder do not in any way conflict with

                                       19
<PAGE>

and are not inconsistent with the rights granted to the holders of the Company's
securities under any other agreement in effect on the date hereof.

          (b)  In the event of any inconsistency with respect to the
registration and sale of New Warrants and New Warrant Stock as provided for in
this Agreement and in the Warrant Agreement, dated as of the date hereof between
the Company and the Warrant Agent named therein, this Agreement shall govern the
rights and obligations of those Holders of Registrable Securities who are also
Holders as defined in the Warrant Agreement.

22.  Third Party Beneficiaries.  Holders of Registrable Securities and the
     -------------------------
Indemnified Parties are intended third party beneficiaries of this Agreement,
and this Agreement shall inure to the benefit of, and may be enforced by, such
Persons.  Other than as set forth in the preceding sentence, this Agreement
shall be binding upon and inure solely to the benefit of each party hereto.

23.  NASD Rule 4460.  For the period beginning on the date hereof until the date
     --------------
the New Common Stock are listed and admitted and authorized for trading on the
New York Stock Exchange, the Nasdaq Stock Market or another national securities
exchange, the Company shall comply with the requirements of NASD Rule 4460 as if
it were subject thereto, other than those (a) requiring the Company to provide
notice of certain actions or events to the NASD or (b) set forth in subsections
(b) and (k) thereof.

24.  Listing of New Common Stock.  The Company shall use its reasonable best
     ---------------------------
efforts to cause the New Common Stock, including the Registrable Securities, to
be approved for listing on the New York Stock Exchange, the Nasdaq Stock Market,
or other national securities exchange.

25.  Capacity of Trust as Signatory.  The Company and the Holders agree that (i)
     ------------------------------
this Agreement is executed and delivered by the trustee of the Trust, which
initially is The Bank of New York (the "Trustee"), not individually or
personally but solely in its capacity as the Trustee of the Trusts, in the
exercise of the powers and authority conferred and vested in it as such, (ii)
the representations, undertakings and agreements herein made on the part of each
applicable Trust are made and intended not as personal representations,
undertakings and agreements by the Trustee, but are made and intended for the
purpose of binding only each applicable Trust, (iii) nothing herein contained
shall be construed as creating any liability on the Trustee, individually or
personally, to perform any covenant either expressed or implied contained
herein, all such liability, if any, being expressly waived by the parties who
are signatories to this Agreement and by any Person claiming by, through or
under such parties and (iv) under no circumstances shall the Trustee be
personally liable for the payment of any indebtedness or expenses of each
applicable Trust or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by each applicable Trust
under this Agreement.

                  [Remainder of page intentionally left blank.
                  --------------------------------------------

                            Signature pages follow.]

                                       20
<PAGE>

          IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first written above.

                                    VENCOR, INC. (to be renamed

                                    KINDRED HEALTHCARE, INC.)

                                    By:
                                       ------------------------------------
                                    Name:
                                    Title:


      [Signature blocks of Initial Holders to appear on subsequent pages]

                                       21
<PAGE>

                                                                      SCHEDULE 1



                                INITIAL HOLDERS

Holder                                 Holding
------------------------------------   ---------------------------------------
Ventas Realty, Limited Partnership     1,498,500 shares of New Common Stock
The Ventas Stockholder Trust           0 shares of New Common Stock


[Additional Initial Holders: To include each entity owning at least 10% of the
New Common Stock and New Warrants (on a fully converted basis) issued and
outstanding immediately following the Effective Date; counterparts may be
executed within 30 days of the Effective Date.]

                                       22