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                                                                   Exhibit 10.47



                            FORM OF OPTION AGREEMENT

                  THIS AGREEMENT ("AGREEMENT") is made as of March 31, 1998,
between Senior Care Operators, LLC, a Delaware limited liability company and
Oakhaven Senior Living, Inc., a California corporation (collectively, the
"OPTIONOR") and Balanced Care Corporation, a Delaware corporation, or its
successors and assigns ("BCC").

                               W I T N E S S E T H
                  WHEREAS, collectively, Optionor is the owner of 100% of the
equity interests (the "EQUITY INTERESTS") of _______________________________
_________________, a Delaware limited liability company (the "COMPANY"), which
Equity Interests are evidenced by certificate numbers 1 & 2 of the Company, and
represent 100% of the equity interests in the Company; and

                  WHEREAS, the Company executed and delivered that certain Lease
Agreement dated as of March 31, 1998 (the "LEASE") whereby the Company leased
from Shippensburg ALF, Inc., a Florida corporation (the "LESSOR") property,
together with all improvements built or to be built thereon, located in
Cumberland County, Pennsylvania as more fully described in the Lease (the
"PROPERTY"); and

                  WHEREAS, the Company and Balanced Care at Shippensburg, Inc.,
a Delaware corporation (the "MANAGEMENT FIRM") have entered into that certain
Management Agreement dated as of March 31, 1998 (the "MANAGEMENT AGREEMENT")
whereby the Company has appointed the Management Firm as the exclusive manager
and operator of the Facility; and

                  WHEREAS, BCC, Optionor and the Company have entered into that
certain Shortfall Funding Agreement dated as of March 31, 1998 (the "SHORTFALL
AGREEMENT") whereby, among other matters, BCC has agreed to fund certain
Shortfalls by making loans to the Company, as more fully provided in the
Shortfall Agreement; and

                  WHEREAS, BCC is willing to enter into the Shortfall Agreement,
and all other Transaction Documents of which BCC is a party, only if Optionor
executes and delivers an option agreement whereby BCC or its successors and
assigns may acquire all of the Equity Interests of the Optionor, on the terms
and conditions provided herein.

                  NOW, THEREFORE, for valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound
hereby, the parties hereto hereby agree as follows:

                  1. GRANT OF OPTION/CONSIDERATION. (a) Optionor hereby grants
to BCC an option (the "OPTION") to purchase all of Optionor's right, title and
interest in and to the Equity Interests on the terms and conditions provided
herein. The Purchase Price for the Equity Interests shall be paid to Optionor on
the Closing Date in immediately available funds. The Option shall be exercisable
by providing written notice to Optionor on or before the ninth anniversary after
the date of this Agreement (the "OPTION TERM").

                  (b) In consideration of the grant of the Option to BCC, BCC
shall make the following payments (the "OPTION PAYMENTS") to Optionor: (1) on
the earlier of one day after the issuance of the certificate of occupancy for
the Facility or twelve months following the closing of construction financing
under the Development Agreement (the "First Payment Date"), an amount 





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equal to the Current Yield (as hereinafter defined) on the Working Capital
Reserve actually funded by Optionor through such date, payable in arrears for
the period commencing on such funding date or dates through the First Payment
Date, plus an amount equal to the Current Yield on the Working Capital Reserve
actually funded by Optionor through such date for the next succeeding 12 month
period, payable in advance, (2) on that date which is twelve months after the
First Payment Date (the "Second Payment Date"), an amount calculated as 25% of
the Current Yield on the Working Capital Reserve actually funded by the Optionor
through such date, representing the first quarterly installment of the annual
Current Yield for the following 12 month period, payable in advance, and (3)
thereafter, on the first day of each three-month period following the Second
Payment Date and for so long as this Agreement is in effect (but ending in all
events at the time of exercise of the Option), 25% of the Current Yield on the
Working Capital Reserve actually funded from time to time by the Optionor,
compounded on an annual basis, representing quarterly installments of the annual
Current Yield, payable in advance. "Current Yield" as used in this Agreement
means an annual return equal to 27.5% of the Working Capital Reserve actually
funded from time to time through the date of such calculation. Notwithstanding
anything to the contrary contained herein, if the Option is exercised, BCC's
obligation to make Option Payments thereafter shall cease. Option Payments shall
be made to Optionors without demand or notice, except as expressly provided
herein.

                  (c) Until BCC provides written notice of its exercise of the
Option, BCC shall be under no obligation whatsoever to purchase the Equity
Interests or exercise the Option, and shall not otherwise have any liability
whatsoever hereunder in connection with Option Payments or the purchase of the
Equity Interests.

                  (d) The "PURCHASE PRICE" as used herein shall mean (i) an
amount equal to the Working Capital Reserve actually funded by the Optionor
under the Shortfall Agreement, plus (ii) an amount calculated as the Current
Yield on the Working Capital Reserve actually funded by the Optionor under the
Shortfall Agreement, compounded annually through the Closing Date (as defined
below), plus (iii) the aggregate amount of all Advances and all other
obligations due and payable by the Company or the Optionor to BCC or a BCC
Affiliate under the Transaction Documents through the Closing Date (exclusive of
the Management Fee under the Management Agreement), minus (iv) any Option
Payments. The aggregate amount of all Advances and all other obligations due and
payable by the Company or the Optionor through the Closing Date to BCC or a BCC
Affiliate under the Transaction Documents as provided in Subsection (iii) of
this Section 1(d), shall be paid to BCC or the BCC Affiliate (as appropriate) on
the Closing Date from the Purchase Price. To avoid any doubt, BCC shall receive
a credit against the Purchase Price for Option Payments paid as Current Yield in
advance, to the extent that such advanced Option Payments are attributable to
Current Yield accruing after the Closing Date.


                  2. CLOSING. (a) The closing of the purchase of the Equity
Interests (the "CLOSING"), pursuant to the exercise of the Option, shall take
place at such time and location in Pennsylvania as shall be designated by BCC
upon three (3) days prior written notice to Optionor (the "CLOSING DATE"). At
the Closing (i) BCC shall deliver the Purchase Price and (ii) Optionor shall
deliver to BCC (A) the certificates representing the original Equity Interests,
together with such powers and other instruments as BCC may request and (B) the
certificate of an appropriate officer of the Company stating that the transfer
of the Equity Interests to BCC has been recorded on the books and records of the
Company, and affirming to BCC such additional matters as BCC may reasonably
request. Additionally, both BCC and Optionor shall take such further actions and
execute and deliver such further documents and instruments as either party may
reasonably 



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request. The Equity Interests shall be transferred to BCC free and clear of all
Liens and restrictions of any kind or nature, except for Liens in favor of BCC
as expressly provided herein and Liens in favor of Lessor as expressly provided
in the Lease.

                  (b) Notwithstanding anything to the contrary contained herein
or in the other Transaction Documents and without in any way implying that such
actions are permissible under the Transaction Documents, if and to the extent
that the funding of the Working Capital Reserve is advanced in the form of a
loan to the Company (such advances, together with all interest, penalties and
other costs and fees assessed or incurred in connection therewith, are referred
to herein as the "BORROWINGS"), the Borrowings shall be repaid in full from the
Purchase Price at the Closing. Optionor shall give BCC prior written notice
before authorizing the Company to make any Borrowings, detailing the amount
thereof. BCC shall have the right at the Closing to pay to the holder of any
note evidencing Borrowings from the Purchase Price the total amount outstanding
with respect to the Borrowings.

                  3.  COVENANTS OF OPTIONOR/LEGEND/PLEDGE. (a) Optionor shall 
not (i) sell, assign, convey, pledge (except as expressly provided herein),
encumber or otherwise transfer (by operation of law or otherwise) any of
Optionor's rights, title or interest under, in or to the Equity Interests, (ii)
cause or permit the Company to merge, consolidate, dissolve, liquidate, change
its capital structure, issue new or substitute Equity Interests (including the
issuance of warrants) or sell, convey, assign or otherwise transfer all or any
portion of the Company's assets or (iii) cause or permit the Company to
otherwise take any action that with the passage of time and/or the giving of
notice would constitute a default under or a breach of any covenant or provision
of the Shortfall Agreement or the other Transaction Documents.

                  (b) Optionor shall cause the Company to place the following
legend on all certificates representing Equity Interests:

                  THE INTERESTS REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
                  AN OPTION TO PURCHASE IN FAVOR OF BALANCED CARE CORPORATION
                  AND ITS SUCCESSORS AND ASSIGNS, AS MORE FULLY SET FORTH IN
                  THAT CERTAIN OPTION AGREEMENT DATED AS OF MARCH 31, 1998.

                  (c) To secure the obligations of the Optionor hereunder,
Optionor hereby grants and pledges to BCC a first priority lien and security
interest in the Equity Interests. Such pledge shall be further memorialized by
the Pledge Agreement. For purposes of perfecting the security interest in the
Equity Interests, Optionor shall deliver herewith to BCC possession of all
certificates, instruments, documents and other evidence of Optionor's ownership
of the Equity Interests accompanied by undated powers of attorney or other
appropriate duly executed blank transfer powers. Optionor shall take such
further actions, and execute such further documents, as may be requested by BCC
to effect the pledge and grant of a security interest in the Equity Interests.

                  (d) In addition to the other covenants stated herein, each
Optionor covenants and agrees that each Optionor shall not, and shall not cause
the Company to, without the prior written consent of BCC: (i) except as
otherwise expressly permitted under the Transaction Documents or the Lease
Documents, create or suffer to exist any Lien or any other type of preferential
arrangement, upon or with respect to any of the properties of Optionor or the




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Company, whether now owned or hereafter acquired, or assign any right to receive
income, (ii) make any distribution of cash or other property or declare or pay
any dividend or distribution on any securities issued by the Company or Optionor
(provided, however, this restrictions shall not be construed to prohibit
Optionor's Members or shareholders from receiving Option Payments in accordance
with the terms and conditions of this Agreement), (iii) engage in any business
venture or enter into any agreement with respect to any business venture, except
as expressly provided in the Transaction Documents and the Lease Documents with
respect to the Facility, (iv) except as otherwise expressly permitted under the
Transaction Documents and the Lease Documents, convey, transfer, lease,
sublease, assign or otherwise dispose of (whether in one transaction or in a
series of transactions) any of the assets of Optionor or the Company (whether
now owned or hereafter acquired) to, or acquire all or substantially all of the
assets of, any person or Entity, (v) create, assume, guaranty or otherwise
become or remain obligated in respect of, or permit or suffer to exist or to be
created, assumed or incurred or to be outstanding, any Indebtedness, except as
expressly provided in the Lease Documents or the Transaction Documents, (vi)
form, organize or participate in the formation or organization of any Entity, or
make any investment in any newly formed or existing Entity, (vii) amend,
supplement or otherwise modify the terms of the Articles of Organization or the
Operating Agreement of the Company in any way, (viii) enter into any transaction
with Lessor or any affiliate or related party to or with Lessor, other than
pursuant to the Transaction Documents and the Lease Documents, (ix) merger or
consolidate with, purchase all or any substantial part of the assets of, or
otherwise acquire any Entity, (x) issue any equity interests in the Company or
options, warrants or other rights to purchase any equity interests in the
Company or any securities convertible or exchangeable for equity interests in
the Company, or commit to do any of the foregoing, other than in favor of BCC in
accordance with the Transaction Documents or (xi) enter into any administrative
or other similar agreement with any party relating to the provision of
administrative or management service for the benefit of either Optionor or the
Company.

                  4. REPRESENTATIONS AND WARRANTIES. Optionor represents and
warrants to BCC that (i) Optionor is the sole and exclusive owners of the Equity
Interests free and clear of all Liens and restrictions (except Permitted Liens),
and Optionor's ownership interest in the Equity Interests is appropriately noted
and documented on the books and records of the Company, (ii) each Optionor is
validly organized and in good standing under the jurisdiction of its formation,
this Agreement and the other Transaction Documents to which the Optionors are a
party have been duly authorized by all requisite action and this Agreement and
the other Transaction Documents to which each Optionor is a party constitutes
the legal, valid and binding obligation of each Optionor, subject only to
bankruptcy and creditor's rights laws, (iii) no Person or Entity holds any
Equity Interests in the Company, other than the Optionor, (iv) the Equity
Interests have been duly issued to Optionor, are fully paid and nonassessable,
(v) Optionor has the full right and power to transfer and convey the Equity
Interests, enter into this Option Agreement and sell the Equity Interests to BCC
without the need to obtain the consent or joinder of any Person or Entity, (vi)
Optionor (and each person or Entity that has an ownership in Optionor) has had
the opportunity to ask all questions of BCC, the Company and any other person or
entity necessary or desirable concerning Optionor's investment in the Equity
Interests, (vii) Optionor (and each person or Entity that has an ownership
interest in Optionor) has the requisite knowledge and sophistication to make
informed decisions regarding the risks and merits of an investment in the
Company, and has not relied on any oral or written statements of BCC or any BCC
Affiliate in connection with Optionor's investment in the Company and (viii)
Optionor (and each person or Entity that has an ownership interest in Optionor)
understands that the Equity Interests will be deemed restricted securities
within the meaning of the 1933 Act (and state securities laws), the Equity
Interests are non-transferable and Optionor (and each person or Entity that has
an 



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ownership interest in Optionor) must be able to bear the economic risks of
ownership of the Equity Interests for an indefinite period of time. The
provisions of this Section shall survive the Closing and purchase of the Equity
Interests.

                  5. BINDING EFFECT. The rights and obligations of the parties
hereunder shall be binding upon and inure to the benefit of the parties hereto
and their heirs, personal representatives, successors and assigns.

                  6. ASSIGNMENT. Optionor may not assign, pledge, hypothecate or
otherwise transfer its rights, obligations and duties hereunder without the
prior written consent of BCC. BCC shall have the right to transfer and assign
its rights, obligations and duties hereunder to any affiliate or third party
without the consent of the Optionor; provided, however, no such transfer or
assignment shall relieve BCC of its obligations hereunder.

                  7. DEFAULT. (a) In the case of default by Optionor hereunder,
BCC shall be entitled, after ten (10) days prior written notice to Optionor, to
(a) seek an action in specific performance and/or (b) seek such other relief,
including without limitation an action at law for damages, as may be available.
Optionor shall pay all reasonable counsel fees of BCC in connection with
enforcing any rights or benefits of BCC hereunder or under the other Transaction
Documents. The rights and remedies of BCC under this Option Agreement are
cumulative and not exclusive of any rights or remedies which it may otherwise
have.

                  (b) In the case of default by BCC hereunder, Optionor shall be
entitled, after ten (10) days prior written notice to BCC, to seek such relief,
including without limitation an action at law for damages, as may be available
to Optionors. BCC shall pay all reasonable counsel fees of Optionor in
connection with enforcing any rights or benefits of Optionor hereunder. The
rights and remedies of Optionor under this Option Agreement are cumulative and
not exclusive of any rights or remedies which they may otherwise have.

                  (c) Notwithstanding the provisions of Section 7(b) and so long
as no Event of Default has occurred under any Transaction Document or Lease
Document which was caused by either Optionor or the Company, in the event that
BCC fails to make Option Payments as provided hereunder, after ten (10) days
prior written notice of such failure sent by Optionor to BCC, Optionor shall
have the following remedies and rights, which remedies and rights shall be the
sole and exclusive remedies and rights of Optionor in the case of such failure:
(i) BCC shall no longer have any right to exercise the Option or the Asset
Purchase Option, (ii) all Notes issued by the Company pursuant to the Shortfall
Agreement shall automatically be amended to provide that interest due under the
Notes will accrue and not be due and payable until the date which is the fifth
(5th) anniversary of the date of issuance of the first Note so issued by the
Company pursuant to the Shortfall Agreement and (iii) the lien encumbering the
Equity Interests and other assets in favor of BCC arising hereunder and under
the Pledge Agreement and the Leasehold Mortgage shall automatically be released
and terminated. BCC agrees, after the failure to make Option Payments and an
opportunity to cure as provided herein, to execute such documents and
instruments, and accept delivery of such replacement Notes (returning the Notes
to be replaced) as Optionors may reasonably request to effect the provisions of
Subsections (c)(i), (c)(ii) and (c)(iii) above.

                  8.  NOTICES. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if delivered in
person, Federal Express or other recognized overnight courier or sent by
registered or certified U.S. mail, return receipt requested or 



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sent by facsimile or telecopy transmission and addressed:

                                   (i)     If to the Optionor,  at:

                                           1350 Old Bayshore Highway
                                           Suite 300
                                           Burlingame, CA 94010
                                           Attention: F. David Carr

                                   (ii)    If to BCC at

                                           5021 Louise Drive
                                           Suite 200
                                           Mechanicsburg, PA 17055

or to such other address or facsimile number as a party may designate by notice
to the other parties hereto.

                  9. DEFINITIONS; INTERPRETATION; MISCELLANEOUS. Capitalized
terms used but not otherwise defined in this Agreement have the respective
meanings specified in Appendix 1 hereto; the rules of interpretation and other
provisions set forth in Appendix 1 hereto shall apply to this Agreement.



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                  IN WITNESS WHEREOF, the parties hereto have executed this
Option Agreement as of the day and year first above written.


                                         SENIOR CARE OPERATORS, LLC,

                                         By:  RETIREMENT OPERATORS
                                              FUNDING, LLC, Manager

                                              By: RETIREMENT OPERATORS
                                                    MANAGEMENT, INC., Manager


                                              By:_________________________
                                                         F. David Carr,
                                                         President


                                              OAKHAVEN SENIOR LIVING, INC.



                                              By:_________________________

                                              Title:______________________



                                              BALANCED CARE CORPORATION



                                              By:_________________________

                                              Title:______________________


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