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                                                                   EXHIBIT 10.19


                FORM OF CAPITAL POINT PRE-DEVELOPMENT AGREEMENT


      THIS PRE-DEVELOPMENT AGREEMENT dated as of August 26, 1998 (the
"Agreement"), executed by and between BCC Development and Management Co., a
Delaware corporation (the "Developer"), and Capital Point Holding Company, LLC,
a Texas limited liability company or its assigns (the "Owner").

                                    RECITALS:

      WHEREAS, Developer has a certain real estate option to acquire real
property located in [________________] (the "Land"); and

      WHEREAS, Owner and Developer have entered into that certain Letter of
Intent dated as of August 17, 1998 (the "LOI"), under which Owner has agreed,
among other things, to develop, construct and finance a 60-unit residential care
facility and related site improvements (collectively, the "Improvements") on the
Land (hereinafter, the acquisition of the Land, together with the planning,
development, construction, licensing and financing arising in connection with
the Improvements to be erected thereon, may hereinafter be referred to as the
"Project"); and

      WHEREAS, Developer is experienced in the acquisition, planning, and
pre-development of residential care facilities; and

      WHEREAS, Owner has requested, and Developer has agreed, to assist Owner
with the pre-development of the Project detailed in Section 1.1 below, which
includes certain services that have already been provided by Developer prior to
the date of this Agreement; and

      WHEREAS, Owner and Developer intend by this Agreement to confirm the terms
and conditions upon which Developer has assisted Owner in connection with the
pre-development of the Project.

      NOW THEREFORE, in consideration of the mutual covenants contained herein,
and for other valuable consideration the receipt and adequacy of which are
hereby acknowledged, the parties hereto, intending to be legally bound hereby,
agree as follows:

                              ARTICLE 1 - SERVICES

      1.1 Services. Prior to the date of this Agreement, Developer has performed
the following services in connection with the pre-development of the Project on
behalf of Owner:

            (a) Market Analysis. Developer has provided a preliminary analysis
      of the demand for "residential care" in the area where the Land is
      located, an investigation of local labor supplies and of suitable
      locations for a residential care facility and 
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      consultation regarding a feasibility study.

            (b) Architectural Consultation. Developer has worked in conjunction
      with architectural firms in developing architectural plans and
      specifications (the "Plans and Specifications") for the Project, and has
      acquired all of the rights thereto.

            (c) Plans and Specifications. Developer will permit the use of the
      Plans and Specifications to permit the construction of the Improvements
      but this use shall be solely with respect to the Project.

            (d) Construction Consultation. Developer has provided assistance in
      preparing a construction schedule, cost estimate, construction budget,
      bidding information and bidding forms for the Project.

            (e) Civil Engineering Consultation. Developer has provided
      assistance in (i) evaluating civil engineering and site work and (ii)
      reviewing, negotiating and/or awarding civil engineering contracts for the
      Project.

            (f) Geotechnical/Environmental Consultation. Developer has obtained
      a written report from a qualified geotechnical or engineering firm
      concerning the presence, handling, treatment and disposal of hazardous
      substances with respect to the Project and the recommended construction
      practices based on the properties of the subsurface soils comprising the
      Land.

            (g) Site Selection. Developer has worked in conjunction with real
      estate brokers and agents to locate the Land that either permits the
      construction and development of the Project as a matter of right for an
      unlimited time period and not merely as a non-conforming use or that
      permits the Land to be subdivided and rezoned, if necessary, in order to
      permit the foregoing.

            (h) Option Agreements. Developer has negotiated and obtained a fully
      executed and assignable land option agreement, as amended (the "Option
      Agreement") attached hereto and incorporated herein as Exhibit A to
      purchase the Land on which the Project will be constructed. The Option
      Agreement expires on [____________], unless extended as contemplated under
      the Option Agreement.

            (i) Survey. Developer has obtained an ALTA/ACSM land survey for the
      Project, which includes a metes and bounds description of the property and
      a surveyor's certificate that runs, or will run, in favor of Developer,
      Owner, Owner's financing source(s) and the title insurer as being true and
      accurate.

            (j) Subdivision. Where applicable, Developer has subdivided the Land
      to permit the Land to be used for its intended use and to be treated as a
      separate legal lot or parcel which for all purposes may be taxed,
      mortgaged, conveyed and otherwise dealt with as a separate lot or parcel.

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            (k) Utilities; Governmental Concurrences; Access. Developer has
      obtained confirmation from certain governmental authorities and public
      utility companies that (i) utilities, including without limitation,
      telephone, gas, electric power, fire protection, storm and sanitary sewer
      facilities and water are or will be available to the boundaries of the
      Land; (ii) such utilities are or will be adequate for Owner's intended use
      of the Land as a residential care facility and such ancillary uses as are
      permitted by law and may be necessary in connection therewith or
      incidental thereto, and (iii) the means of ingress and egress, access to
      public streets and drainage facilities are or will be adequate for Owner's
      intended use of the Land.

            (l) Land Use Approvals. Where applicable, Developer has obtained
      certain preliminary/final land development plan approvals in connection
      with the Project.

            (m) Regulatory Approvals. Where applicable, Developer has obtained
      certain regulatory approvals, including certificates of need, with respect
      to the Project.

            ARTICLE 2 - DEVELOPER'S REPRESENTATIONS AND WARRANTIES

      Developer represents and warrants to Owner that:

      2.1 It is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware.

      2.2 It has the requisite power and authority to carry on its business as
now being conducted and as contemplated by this Agreement.

      2.3 It has the power to execute, deliver and perform this Agreement, and
the execution, delivery and performance of the terms and provisions of this
Agreement on its part to be observed or performed have been duly authorized by
all requisite corporate action on the part of Developer and will not (i) violate
any provision of law, any order of any court or governmental instrumentality or
other agency, or any indenture, agreement or other instrument to which it is a
party or by which it is bound, (ii) be in conflict with, result in a breach of
or constitute (with due notice or lapse of time or both) a default under any
such indenture, agreement or other instrument or (iii) result in the creation or
imposition of any lien, charge or encumbrance of any nature whatsoever upon any
of the assets of Developer.

              ARTICLE 3 - OWNER'S REPRESENTATIONS AND WARRANTIES

      Owner represents and warrants to Developer that:

      3.1 It is a limited liability company duly organized, validly existing and
in good standing under the laws of the State of Texas.

      3.2 It has the requisite power and authority to carry on its business as
now being 

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conducted and as contemplated by this Agreement.

      3.3 It has the power to execute, deliver and perform this Agreement, and
the execution, delivery and performance of the terms and provisions of this
Agreement on its part to be observed or performed have been duly authorized by
all requisite corporate action on the part of Owner and will not (i) violate any
provision of law, any order of any court or governmental instrumentality or
other agency, or any indenture, agreement or other instrument to which it is a
party or by which it is bound, (ii) be in conflict with, result in a breach of
or constitute (with due notice or lapse of time or both) a default under any
such indenture, agreement or other instrument or (iii) result in the creation or
imposition of any lien, charge or encumbrance of any nature whatsoever upon any
of the assets of Owner.

                      ARTICLE 4 - COMPENSATION OF DEVELOPER

      As compensation for the services hereunder, Owner agrees to pay Developer
a fee in the amount of $300,000, which fee shall be paid as follows: (i)
$150,000 due and payable upon the earlier to occur of (a) November 30, 1998 or
(b) closing on the financing for the Project and (ii) $25,000 due and payable on
the last business day of each calendar month commencing on December 31, 1998 and
continuing thereafter up through and including May 31, 1999.

                          ARTICLE 5 - EVENTS OF DEFAULT

      5.1 Events of Default. The occurrence of one or more of the following
events shall, at the option of the non-defaulting party, constitute an "Event of
Default" hereunder:

            (a) Developer or Owner fails to observe or perform any of their
      respective obligations in accordance with the terms and provisions of this
      Agreement or breaches any of their respective representations or
      warranties and such failure or breach continues uncured for a period of 30
      days after the giving of notice by the non-defaulting party to the
      defaulting party specifying the nature of such failure or breach;

            (b) A court of competent jurisdiction enters a decree or order for
      relief with respect to Developer or Owner in any involuntary case under
      the Federal Bankruptcy Code or any other applicable bankruptcy, insolvency
      or similar law now or hereafter in effect, or for the appointment of a
      receiver, liquidator, trustee or similar official of such party or for any
      substantial part of such party's property, or for the winding up or
      liquidation of such party's affairs and such decree or order remains in
      effect for a period of 90 days from the date of entry thereof; or

            (c) Developer or Owner commences a voluntary case under the Federal
      Bankruptcy Code or any applicable bankruptcy, insolvency or similar law
      now or hereafter in effect, or shall consent to the entry of an order of
      relief in an involuntary case under such law, or shall consent to the
      appointment of or taking possession by a receiver, liquidator, trustee or
      similar official of such party or for any substantial part of such party's
      property.

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      5.2 Remedies. Upon the occurrence of any Event of Default, the
non-defaulting party will be entitled to terminate this Agreement by written
notice to such effect given to the defaulting party. The non-defaulting party
shall have all rights available at law or in equity as a result of any Event of
Default, including, without limitation, an action for damages and/or specific
performance.

                           ARTICLE 6 - INDEMNIFICATION

      6.1 By Developer. Developer will indemnify and save Owner harmless from
and against any and all loss, cost or expense (including, without limitation,
reasonable attorneys' fees and court costs) arising out of any breach of any of
the representations, warranties, covenants and agreements of Developer under
this Agreement.

      6.2 By Owner. Owner will indemnify and save Developer harmless from and
against any and all loss, cost or expense (including, without limitation,
reasonable attorneys' fees and court costs) arising out of any breach of any of
the representations, warranties, covenants and agreements of Owner under this
Agreement.

                            ARTICLE 7 - MISCELLANEOUS

      7.1 Termination Date. The obligations of Developer under this Agreement
shall terminate as of the date (herein referred to as the "Termination Date")
when the Project has been substantially completed.

      7.2 Entire Agreement. This Agreement embodies the entire agreement and
understanding between the parties relating to the subject matter hereof and
supersedes all prior agreements and understandings relating to such subject
matter, and it is agreed that there are no terms, understandings,
representations or warranties, express or implied, other than those set forth
herein.

      7.3. Binding Effect. This Agreement will be binding upon the parties
hereto and their respective successors and permitted assigns. This Agreement may
not be assigned by either of the parties hereto without the written consent of
the other party; provided, however, Owner may assign this Agreement to an
affiliate of Owner without such consent.

      7.4 Captions. The descriptive headings of the articles and sections of
this Agreement are inserted for convenience only, and are not intended and will
not be construed, to limit, enlarge or affect the scope or intent of this
Agreement or the meaning of any provision hereof.

      7.5 Notices. All notices, consents, waivers, directions, requests or other
instruments or communications provided for in this Agreement will be in writing,
signed by the party giving the same or such party's attorney, and shall be
deemed properly given if sent by reputable overnight service, by telegram or by
registered or certified United States mail, return receipt requested, postage
prepaid, and addressed as follows:

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      If to Developer:

            BCC Development and Management Co.
            5021 Louise Drive
            Suite 200
            Mechanicsburg, PA 17055
            Attention: Brian L. Barth

      With a copy to:

            Balanced Care Corporation
            5021 Louise Drive
            Suite 200
            Mechanicsburg, PA 17055
            Attention: Robin L. Barber

      If to Owner:

            Capital Point Holding Company, LLC
            10370 Richmond Avenue, Suite 900
            Houston, TX 77042
            Attention: J. Michael Sadler

      With a copy to:

            Richard D. Penry, Esq.
            10370 Richmond Avenue, Suite 900
            Houston, TX 77042

or to such other address as a party may from time to time designate in the
manner set forth above.

      7.6 No Oral Modification. This Agreement may not be changed or modified
except by an agreement in writing executed by each of the parties hereto.

      7.7 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall constitute one and the same instrument.

      7.8   Governing Law.  THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF [_______________] BUT
WITHOUT REGARD TO ITS CONFLICTS OF LAW PROVISIONS.

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      7.9 Severability. If any provision of this Agreement is held invalid, it
will not affect in any respect whatsoever the validity of the remainder of this
Agreement.

                       [SIGNATURES CONTINUED ON NEXT PAGE]

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      IN WITNESS WHEREOF, intending to be legally bound hereby, the parties
hereto have caused this Agreement to be duly executed by its duly authorized
officers empowered so to act as of the day and year first above written.


                              BCC DEVELOPMENT AND MANAGEMENT CO.


                              By: ________________________________________
                                  Name:
                                  Title:


                              CAPITAL POINT HOLDING COMPANY, LLC


                              By:_________________________________________
                                 Name:
                                 Title:


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OMITTED EXHIBIT


EXHIBIT A:        OPTION AGREEMENT