Document:

<PAGE>
                                                                     Exhibit 4.2

                                   ----------

                             STOCKHOLDERS AGREEMENT

                                  BY AND AMONG

                          BROOKDALE SENIOR LIVING INC.,

                              FIT-ALT INVESTOR LLC,

                       FORTRESS BROOKDALE ACQUISITION LLC,

                          FORTRESS INVESTMENT TRUST II

                                       and

                                 HEALTH PARTNERS

                                   ----------

                            Dated as of ______, 2005
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<TABLE>
<S>                                                                           <C>
ARTICLE I DEFINITIONS......................................................    1
Section 1.1  Defined Terms.................................................    1

ARTICLE II TRANSFER........................................................    6
Section 2.1  Binding Effect on Transferees.................................    6
Section 2.2  Additional Purchases..........................................    7
Section 2.3  Charter Provisions............................................    7
Section 2.4  Legend........................................................    7

ARTICLE III BOARD OF DIRECTORS.............................................    7
Section 3.1  Board                                                             7

ARTICLE IV REPRESENTATIONS OF EACH STOCKHOLDER.............................    9
Section 4.1  Due Organization, Authorization...............................    9
Section 4.2  Enforceability, Etc...........................................    9
Section 4.3  No Conflicts..................................................    9
Section 4.4  Governmental Approvals........................................    9
Section 4.5  Litigation....................................................   10
Section 4.6  Title to the Shares...........................................   10

ARTICLE V REGISTRATION RIGHTS..............................................   10
Section 5.1  Demand Registration...........................................   10
Section 5.2  Piggyback Registrations.......................................   12
Section 5.3  Shelf Registration............................................   14
Section 5.4  Withdrawal Rights.............................................   15
Section 5.5  Holdback Agreements...........................................   16
Section 5.6  Registration Procedures.......................................   16
Section 5.7  Registration Expenses.........................................   20
Section 5.8  Indemnification...............................................   21

ARTICLE VI MISCELLANEOUS...................................................   24
Section 6.1  Headings......................................................   24
Section 6.2  Entire Agreement..............................................   24
Section 6.3  Further Actions; Cooperation..................................   24
Section 6.4  Notices.......................................................   24
Section 6.5  Applicable Law................................................   26
Section 6.6  Severability..................................................   26
</TABLE>

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<TABLE>
<S>                                                                           <C>
Section 6.7  Successors and Assigns........................................   26
Section 6.8  Amendments....................................................   27
Section 6.9  Waiver........................................................   27
Section 6.10 Counterparts..................................................   27
Section 6.11 Submission to Jurisdiction....................................   27
Section 6.12 Injunctive Relief.............................................   27
Section 6.13 Recapitalizations, Exchanges, Etc. Affecting the shares of
                Common Stock; New Issuances................................   28
Section 6.14 Termination...................................................   28
Section 6.15 Rule 144......................................................   28
</TABLE>

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                             STOCKHOLDERS AGREEMENT

                                       OF

                          BROOKDALE SENIOR LIVING INC..

                                   ----------

          THIS STOCKHOLDERS AGREEMENT (this "Agreement") is made as of _______,
2005, by and among Brookdale Senior Living Inc., a Delaware corporation (the
"Company"), FIT-ALT Investor LLC, a Delaware limited liability company
("FIT-ALT"), Fortress Brookdale Acquisition LLC, a Delaware limited liability
company ("FBA"), Fortress Investment Trust II, a Delaware business trust
("FIT"), and Health Partners, a Bermuda exempted partnership ("HP"). FBA, FIT,
FIT-ALT and HP are referred to herein individually as an "Initial Stockholder"
and collectively referred to herein as the "Initial Stockholders." Certain
capitalized terms used in this Agreement are defined in Article I. Unless
otherwise indicated, references to articles and sections shall be to articles
and sections of this Agreement.

          WHEREAS, each Initial Stockholder is the holder of shares of Common
Stock (as hereinafter defined);

          WHEREAS, the Initial Stockholders desire to regulate the sale,
assignment, transfer, encumbrance or other disposition of Company Securities (as
hereinafter defined) and to provide for certain rights and obligations in
respect thereto as hereinafter provided;

          WHEREAS, the Company has agreed to provide the registration rights set
forth herein; and

          WHEREAS, the Stockholders (as hereinafter defined) deem it in their
best interests and in the best interests of the Company to provide for certain
arrangements with respect to the management of the Company and desire to enter
into this Agreement in order to effectuate such purpose and to set forth certain
of their respective rights and obligations in connection with their investment
in the Company.

          NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements set forth herein and for good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto hereby agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

          Section 1.1 Defined Terms. For purposes of this Agreement, the
following terms shall have the following meanings:
<PAGE>
               (a) "Additional Registration Rights Agreement" shall mean the
Registration Rights Agreement, dated June 29, 2005, between the Company,
Emeritus Corporation and NW Select LLC.

               (b) "Additional Sellers" shall mean those Persons which are
entitled to demand and "piggyback" registration rights with respect to shares of
Common Stock owned by them pursuant to the Additional Registration Rights
Agreement.

               (c) "Additional Shares" shall mean the "Registrable Securities"
(as such term is defined in the Additional Registration Rights Agreement) held
by the Additional Sellers.

               (d) "Affiliate" shall have the meaning set forth in Rule 12b-2
promulgated under the Exchange Act; provided that no Stockholder shall be deemed
an Affiliate of any other Stockholder solely by reason of any investment in the
Company.

               (e) "Agreement" shall have the meaning assigned to it in the
introductory paragraph.

               (f) A Person shall be deemed to "Beneficially Own" securities if
such Person is deemed to be a "beneficial owner" within the meaning of Rules
13d-3 and 13d-5 under the Exchange Act as in effect on the date of this
Agreement.

               (g) "Board" shall have the meaning assigned to it in Section
3.1(a).

               (h) "Capital Stock" shall mean and include (i) any and all
shares, interests, participations or other equivalents of or interests in
(however designated) corporate stock of any Person, including, without
limitation, shares of preferred or preference stock, (ii) all partnership
interests (whether general or limited) in any Person which is a partnership,
(iii) all membership interests or limited liability company interests in any
limited liability company and (iv) all equity or ownership interests in any
Person of any other type.

               (i) "Commission" shall mean the United States Securities and
Exchange Commission or any successor agency.

               (j) "Common Stock" shall mean the Company's common stock, par
value $0.01 per share and any and all securities of any kind whatsoever of the
Company which may be issued and outstanding on or after the date hereof in
respect of, in exchange for, or upon conversion of shares of Common Stock
pursuant to a merger, consolidation, stock split, stock dividend,
recapitalization of the Company or otherwise.

               (k) "Company" shall have the meaning assigned to it in the
introductory paragraph.

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               (l) "Company Securities" shall mean (i) any Common Stock and (ii)
any other securities of the Company entitled to vote generally in the election
of directors of the Company.

               (m) "Demand" shall have the meaning assigned to it in Section
5.1(a).

               (n) "Demand Registration" shall have the meaning assigned to it
in Section 5.1(a).

               (o) "Emeritus/NW Select Demand Registration" shall have the
meaning assigned to "Demand Registration" in the Registration Rights Agreement,
dated the date hereof, by and among the Company, Emeritus Corporation and NW
Select LLC.

               (p) "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated thereunder.

               (q) "FBA" shall have the meaning assigned to it in the
introductory paragraph.

               (r) "FIG Advisors" shall mean FIG Advisors LLC, a Delaware
limited liability company, or any other Person designated as "FIG Advisors" by
Fortress Investment Group LLC in a written notice to the Company.

               (s) "FIT" shall have the meaning assigned to it in the
introductory paragraph.

               (t) "FIT-ALT" shall have the meaning assigned to it in the
introductory paragraph.

               (u) "Form S-3" shall have the meaning assigned to it in Section
5.3(a).

               (v) "Fortress Stockholders" shall mean collectively FBA, FIT and
FIT-ALT.

               (w) "HP" shall have the meaning assigned to it in the
introductory paragraph.

               (x) "Initial Public Offering" shall mean the initial public
offering of Common Stock pursuant to an effective registration statement under
the Securities Act.

               (y) The terms "Initial Stockholder" and "Initial Stockholders"
shall each have the meaning assigned to such term in the introductory paragraph.

               (z) "Inspectors" shall have the meaning assigned to it in Section
5.6(a)(viii).

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               (aa) "Liens" shall have the meaning assigned to it in Section
4.3.

               (bb) "Losses" shall have the meaning assigned to it in Section
5.8(a).

               (cc) "NYSE" means the New York Stock Exchange.

               (dd) "Other Demanding Sellers" shall have the meaning assigned to
it in Section 5.2(b).

               (ee) "Other Proposed Sellers" shall have the meaning assigned to
it in Section 5.2(b).

               (ff) "Partner Permitted Transferee" shall mean those Permitted
Transferees of HP or any of its Permitted Transferees specified in clauses
(iii)(A) and (D) of the definition of "Permitted Transferee" contained herein.

               (gg) "Piggyback Notice" shall have the meaning assigned to it in
Section 5.2(a).

               (hh) "Piggyback Registrable Amount" shall mean an amount of
Common Stock equal to 1% of the Common Stock issued and outstanding immediately
after the consummation of the Initial Public Offering.

               (ii) "Piggyback Registration" shall have the meaning assigned to
it in Section 5.2(a).

               (jj) "Piggyback Seller" shall have the meaning assigned to it in
Section 5.2(a).

               (kk) "Piggyback Stockholder" shall mean (i) the Initial
Stockholders and (ii) each Permitted Transferee who becomes a party to or bound
by the provisions of this Agreement in accordance with the terms hereof or
Permitted Transferee thereof who is entitled to enforce the provisions of this
Agreement in accordance with the terms hereof, in the case of clauses (i) and
(ii), to the extent that such Initial Stockholder (irrespective of whether or
not such Initial Stockholder owns any Registrable Securities) or such Permitted
Transferee, together with its respective Permitted Transferees (other than any
other Initial Stockholders), holds at least a Piggyback Registrable Amount.

               (ll) "Permitted Transferee" shall mean, with respect to each
Stockholder, (i) any other Stockholder, (ii) such Stockholder's Affiliates and
(iii) in the case of any Stockholder, (A) any general or limited partner or
member of such Stockholder, (B) any corporation, partnership, limited liability
company or other entity that is an Affiliate of such Stockholder or any general
or limited partner of such Stockholder (collectively, "Stockholder Affiliates"),
(C) any investment funds managed directly or indirectly by such Stockholder or
any Stockholder Affiliates (a "Stockholder Fund"), (D) any general or limited
partner of any Stockholder Fund, (E) any managing director, general partner,
director, limited partner, officer or employee of any Stockholder

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Affiliate, or any spouse, lineal descendant, sibling, parent, heir, executor,
administrator, testamentary trustee, legatee or beneficiary of any of the
foregoing persons described in this clause (E) (collectively, "Stockholder
Associates") or (F) any trust, the beneficiaries of which, or any corporation,
limited liability company or partnership, the stockholders, members or general
or limited partners of which consist solely of any one or more of such
Stockholder, any general or limited partner of such Stockholder, any Stockholder
Affiliates, any Stockholder Fund, any Stockholder Associates, their spouses or
their lineal descendants.

               (mm) "Person" shall mean any individual, firm, corporation,
partnership, limited liability company or other entity, and shall include any
successor (by merger or otherwise) of such entity.

               (nn) "Public Offering" shall mean an offering of equity
securities of the Company pursuant to an effective registration statement under
the Securities Act, including an offering in which Stockholders are entitled to
sell Common Stock pursuant to the terms of this Agreement.

               (oo) "Records" shall have the meaning assigned to it in Section
5.6(a)(viii).

               (pp) "Registrable Amount" shall mean an amount of Common Stock
equal to 5% of the Common Stock issued and outstanding immediately after the
consummation of the Initial Public Offering.

               (qq) "Registrable Securities" shall mean any Common Stock
currently owned or hereafter acquired by any Stockholder. As to any particular
Registrable Securities, such securities shall cease to be Registrable Securities
when (x) a registration statement registering such securities under the
Securities Act has been declared effective and such securities have been sold or
otherwise transferred by the holder thereof pursuant to such effective
registration statement or (y) such securities are sold in accordance with Rule
144 (or any successor provision) promulgated under the Securities Act.

               (rr) "Requested Information" shall have the meaning assigned to
it in Section 5.8(g).

               (ss) "Requesting Stockholder" shall have the meaning assigned to
it in Section 5.1(a).

               (tt) "Securities Act" shall mean the Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder.

               (uu) "Selling Holders" shall have the meaning assigned to it in
Section 5.6(a)(i).

               (vv) "Shelf Notice" shall have the meaning assigned to it in
Section 5.3(a).

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               (ww) "Shelf Registration Statement" shall have the meaning
assigned to it in Section 5.3(a).

               (xx) "Stockholders" shall mean (i) the Initial Stockholders and
(ii) each Permitted Transferee who becomes a party to or bound by the provisions
of this Agreement in accordance with the terms hereof or Permitted Transferee
thereof who is entitled to enforce the provisions of this Agreement in
accordance with the terms hereof, in the case of clauses (i) and (ii), to the
extent that such Initial Stockholder (irrespective of whether or not such
Initial Stockholder owns any Registrable Securities) or such Permitted
Transferee, together with its respective Permitted Transferees (other than any
other Initial Stockholders), hold at least a Registrable Amount.

               (yy) "Suspension Period" shall have the meaning assigned to it in
Section 5.3(d).

               (zz) "Transfer" shall mean, with respect to any Company
Securities, (i) when used as a verb, to sell, assign, dispose of, exchange,
pledge, encumber, hypothecate or otherwise transfer such Company Securities or
any participation or interest therein, whether directly or indirectly, or agree
or commit to do any of the foregoing and (ii) when used as a noun, a direct or
indirect sale, assignment, disposition, exchange, pledge, encumbrance,
hypothecation, or other transfer of such Company Securities or any participation
or interest therein or any agreement or commitment to do any of the foregoing.

               (aaa) "Underwritten Offering" shall mean a sale of securities of
the Company to an underwriter or underwriters for reoffering to the public.

               (bbb) "Voting Power of the Company" shall mean the total number
of votes that may be cast in the election of directors of the Company if all
Company Securities were present and voted at a meeting held for such purpose.

                                   ARTICLE II

                                    TRANSFER

          Section 2.1 Binding Effect on Transferees. Prior to any Transfer by a
Stockholder of Company Securities to a Permitted Transferee (other than a
Partner Permitted Transferee), the transferring Stockholder shall cause the
transferee to execute an agreement on the same terms and conditions set forth
herein, providing that such transferee shall be bound by and shall fully comply
with the terms of this Agreement (including the provisions of Article IV with
respect to the Company Securities being transferred to such transferee) and
shall become a Stockholder hereunder; provided, however, that prior to any
Transfer to a Partner Permitted Transferee, the transferring Stockholder shall
cause such Partner Permitted Transferee to execute a joinder agreement whereby
such Partner Permitted Transferee shall agree to be bound by the provisions of

                                        6
<PAGE>
Section 5.5 hereof. For the avoidance of doubt, no Partner Permitted Transferee
shall be deemed to have any other rights hereunder, including any right to have
shares of Company Securities registered pursuant to Article V hereof.

          Section 2.2 Additional Purchases. Any Company Securities owned by a
Stockholder on or after the date of this Agreement shall be subject to the terms
and conditions of this Agreement.

          Section 2.3 Charter Provisions. No amendment shall be made to the
Company's Certificate of Incorporation as in effect as of the date of this
Agreement in a manner that would (a) add restrictions to the transferability of
the Company Securities by any Stockholder who was an original party to this
Agreement and who (or whose Permitted Transferee) remains a "Stockholder" at the
time of such an amendment, which restrictions are beyond those provided for in
the Company's Certificate of Incorporation, this Agreement or the securities
laws or (b) nullify any of the rights of any Stockholder who was an original
party to this Agreement and who (or whose Permitted Transferee) remains a
"Stockholder" at the time of such amendment, which rights are explicitly
provided for in this Agreement, unless, in each such case, such amendment shall
have been approved by such Stockholder.

          Section 2.4 Legend. Each certificate representing Company Securities
issued to a Stockholder shall be stamped or otherwise imprinted with a legend in
substantially the following form:

          "The shares represented by this certificate are subject to the
          provisions contained in the Stockholders Agreement dated as of
          ________, 2005 among certain of the stockholders of the Corporation
          named therein."

                                  ARTICLE III

                               BOARD OF DIRECTORS

          Section 3.1 Board.

               (a) For so long as this Agreement is in effect, each of the
Stockholders shall vote or cause to be voted all of the Company Securities held
of record or beneficially owned by such Stockholder and take all other
reasonably necessary action so as to elect to the board of directors of the
Company (the "Board"), and to continue in office not more than seven (7)
directors which shall include (x) those directors designated by FIG Advisors
pursuant to Section 3.1(b) and (y) the director designated by HP pursuant to
Section 3.1(c). The Stockholders shall cause the Company to take all necessary
or desirable action within its control to give effect to the provisions of this
Section 3.1. The Company shall use its reasonable efforts so that a sufficient
number of "independent directors" (as such term is defined in the applicable
NYSE listing standards from time to time) are members of the Board in order for
the Company to comply with

                                        7
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the applicable listing standards of the NYSE without reliance on the "controlled
company" exception contemplated thereby.

               (b) So long as the Fortress Stockholders and their Permitted
Transferees have Beneficial Ownership of:

                    (i) more than 50% of the Voting Power of the Company, FIG
Advisors shall be entitled to designate four directors to the Board,

                    (ii) less than 50% but more than 25% of the Voting Power of
the Company, FIG Advisors shall be entitled to designate three directors to the
Board,

                    (iii) less than 25% but more than 10% of the Voting Power of
the Company, FIG Advisors shall be entitled to designate two directors to the
Board, and

                    (iv) less than 10% but more than 5% of the Voting Power of
the Company, FIG Advisors shall be entitled to designate one director to the
Board.

Each of the Stockholders shall vote or cause to be voted all of the Company
Securities held of record or beneficially owned by such Stockholder and take all
other reasonably necessary action so as to effect the purpose of this Section
3.1(b).

               (c) So long as HP and its Permitted Transferees (other than any
Partner Permitted Transferee) have Beneficial Ownership of more than 5% of the
Voting Power of the Company, HP shall be entitled to designate one director to
the Board. Each of the Stockholders shall vote or cause to be voted all of the
Company Securities held of record or beneficially owned by such Stockholder and
take all other reasonably necessary action so as to effect the purpose of this
Section 3.1(c).

               (d) If either FIG Advisors or HP notifies the other Stockholders
of its desire to remove, with or without cause, any director previously
designated by it, each Stockholder shall vote or cause to be voted all of the
shares of Company Securities held or record or beneficially owned by such
Stockholder and take all other necessary actions to cause the removal of any
director designated by FIG Advisors or HP, as the case may be, pursuant to this
Section 3.1(d).

               (e) In the event that any designee of either FIG Advisors or HP
shall for any reason cease to serve as a member of the Board during his term of
office, the resulting vacancy on the Board will be filled by an individual
designated by FIG Advisors or HP, as the case may be, and each of the
Stockholders shall vote or cause to be voted all of the Company Securities held
of record or beneficially by such Stockholder and take all other reasonably
necessary action so as to effect the purpose of this Section 3.1(e).

               (f) If at any time the number of directors entitled to be
designated by either of FIG Advisors or HP pursuant to this Section 3.1 would
decrease, within 10 days thereafter, FIG Advisors or HP, as applicable, shall
cause a sufficient number of

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directors designated by it to resign from the board so that the number of
directors designated by it on the Board after such resignation(s) equals the
number of directors FIG Advisors or HP, as applicable, would have been entitled
to designate had an election of directors taken place at such time. Any
vacancies created by a resignation required by this Section 3.1(f) shall be
filled by a majority vote of the Board.

                                   ARTICLE IV

           REPRESENTATIONS OF EACH STOCKHOLDER Each Stockholder hereby
          represents and warrants to each other Stockholder as follows:

          Section 4.1 Due Organization, Authorization. Such Stockholder is
either (a) duly organized, validly existing and in good standing under the laws
of its jurisdiction of organization or (b) a natural person that is competent
and has legal capacity to execute, deliver and perform its obligations under
this Agreement. The execution, delivery and performance by such Stockholder of
this Agreement, if not a natural person, and the consummation by such
Stockholder of the transactions contemplated hereby, have been duly authorized
by all necessary corporate and other action on its part.

          Section 4.2 Enforceability, Etc. This Agreement has been duly executed
and delivered by such Stockholder. This Agreement constitutes a legal, valid and
binding obligation of such Stockholder, enforceable against such Stockholder in
accordance with its terms, subject to any limitations imposed by bankruptcy,
insolvency, or other laws of general application relating to enforcement of
creditors' rights or general equity principles.

          Section 4.3 No Conflicts. The execution, delivery and performance of
this Agreement by such Stockholder and the consummation by such Stockholder of
the transactions contemplated hereby will not (a) result in a violation of, be
in conflict with or constitute a default (with or without notice or lapse of
time or both) under (i) any law applicable to such Stockholder or any of its
assets, (ii) any provision of its organizational documents, if such Stockholder
is not a natural person, (iii) any order or judgment of any court or other
agency of government applicable to such Stockholder or any of its assets or (iv)
any contractual restriction binding on or affecting such Stockholder or any of
its assets or (b) result in the creation or imposition of any lien, mortgage,
pledge, claim, right, charge, security interest or other restriction or
encumbrance (collectively, "Liens") upon any of such Stockholder's assets,
including the shares of Common Stock.

          Section 4.4 Governmental Approvals. No consent, approval, order or
authorization of, or registration, declaration or filing with, any court,
administrative agency or commission or other governmental authority or
instrumentality, including under federal or state law or otherwise, is required
to be obtained or made by or with respect to such Stockholder in connection with
its execution and delivery of this Agreement or the consummation of the
transactions contemplated hereby by such Stockholder (other than those which are
not material).

                                       9
<PAGE>
          Section 4.5 Litigation. There is no lawsuit, claim, proceeding or
investigation pending or threatened by or against such Stockholder or any of its
properties, assets, operations, businesses or prospects, which relates to the
transactions contemplated by this Agreement.

          Section 4.6 Title to the Shares. Such Stockholder owns the Company
Securities owned by it free and clear of any Liens.

                                    ARTICLE V

                               REGISTRATION RIGHTS

          Section 5.1 Demand Registration.

               (a) At any time after the six month anniversary of the date
hereof, any Persons that on the date a Demand (as hereafter defined) is made
constitute a Stockholder (a "Requesting Stockholder") shall be entitled to make
a written request of the Company (a "Demand") for registration under the
Securities Act of an amount of Registrable Securities that, when taken together
with the amounts of Registrable Securities requested to be registered under the
Securities Act by such Requesting Stockholder's Affiliates, equals or is greater
than the Registrable Amount (based on the number of Registrable Securities
outstanding on the date such Demand is made) (a "Demand Registration") and
thereupon the Company will, subject to the terms of this Agreement, use its
commercially reasonable efforts to effect the registration under the Securities
Act of:

                    (i) the Registrable Securities which the Company has been so
requested to register by the Requesting Stockholders for disposition in
accordance with the intended method of disposition stated in such Demand;

                    (ii) all other Registrable Securities which the Company has
been requested to register pursuant to Section 5.1(b); and

                    (iii) all shares of Common Stock which the Company may elect
to register in connection with any offering of Registrable Securities pursuant
to this Section 5.1, but subject to Section 5.1(g);

all to the extent necessary to permit the disposition (in accordance with the
intended methods thereof) of the Registrable Securities and the additional
Common Stock, if any, to be so registered.

               (b) A Demand shall specify: (i) the aggregate number of
Registrable Securities requested to be registered in such Demand Registration,
(ii) the intended method of disposition in connection with such Demand
Registration, to the extent then known and (iii) the identity of the Requesting
Stockholder (or Requesting Stockholders). Within five days after receipt of a
Demand, the Company shall give written notice of such Demand to any other
Persons that on the date a Demand is

                                       10
<PAGE>
delivered to the Company constitute a Stockholder. Subject to Section 5.1(g),
the Company shall include in the Demand Registration covered by such Demand all
Registrable Securities with respect to which the Company has received a written
request for inclusion therein within ten days after the Company's notice
required by this paragraph has been given. Such written request shall comply
with the requirements of a Demand as set forth in this Section 5.1(b).

               (c) Each Stockholder shall be entitled to an aggregate of two
Demand Registrations.

               (d) A Demand Registration shall not be deemed to have been
effected and shall not count as a Demand (i) unless a registration statement
with respect thereto has become effective and has remained effective for a
period of at least 60 days (or such shorter period in which all Registrable
Securities included in such Demand Registration have actually been sold
thereunder), (ii) if, after it has become effective, such Demand Registration
becomes subject to any stop order, injunction or other order or requirement of
the Commission or other governmental agency or court for any reason or (iii) if
the conditions to closing specified in the purchase agreement or underwriting
agreement entered into in connection with such Demand Registration are not
satisfied, other than by reason of some act or omission by such Requesting
Stockholders.

               (e) Demand Registrations shall be on such appropriate
registration form of the Commission as shall be selected by the Requesting
Stockholders and shall be reasonably acceptable to the Company.

               (f) The Company shall not be obligated to (i) maintain the
effectiveness of a registration statement under the Securities Act, filed
pursuant to a Demand Registration, for a period longer than 60 days or (ii)
effect any Demand Registration (A) within six months of a "firm commitment"
Underwritten Offering in which all Piggyback Stockholders were given "piggyback"
rights pursuant to Section 5.2 (subject to Section 5.1(g)) and at least 50% of
the number of Registrable Securities requested by such Stockholders to be
included in such Demand Registration were included, (B) within four months of
any other Demand Registration or Emeritus/NW Select Demand Registration or (C)
if, in the Company's reasonable judgment, it is not feasible for the Company to
proceed with the Demand Registration because of the unavailability of audited
financial statements. In addition, the Company shall be entitled to postpone
(upon written notice to all Stockholders) for up to 120 days the filing or the
effectiveness of a registration statement for any Demand Registration (but no
more than twice in any period of 12 consecutive months) if the Board determines
in good faith and in its reasonable judgment that the filing or effectiveness of
the registration statement relating to such Demand Registration would cause the
disclosure of material, non-public information that the Company has a bona fide
business purpose for preserving as confidential. In the event of a postponement
by the Company of the filing or effectiveness of a registration statement for a
Demand Registration, the holders of a majority of Registrable Securities held by
the Requesting Stockholder(s) shall have the right to withdraw such Demand in
accordance with Section 5.4.

                                       11
<PAGE>
               (g) The Company shall not include any securities other than
Registrable Securities and Additional Shares in a Demand Registration, except
with the written consent of Stockholders participating in such Demand
Registration that hold a majority of the Registrable Securities included in such
Demand Registration. If, in connection with a Demand Registration, any managing
underwriter (or, if such Demand Registration is not an Underwritten Offering, a
nationally recognized independent investment bank selected by FIG Advisors or
any of the Permitted Transferees of either of the Fortress Stockholders (to the
extent a Stockholder hereunder), reasonably acceptable to the Company, and whose
fees and expenses shall be borne solely by the Company) advises the Company, in
writing, that, in its opinion, the inclusion of all of the securities, including
securities of the Company that are not Registrable Securities, sought to be
registered in connection with such Demand Registration would adversely affect
the marketability of the Registrable Securities sought to be sold pursuant
thereto, then the Company shall include in such registration statement only such
securities as the Company is advised by such underwriter can be sold without
such adverse effect as follows and in the following order of priority: (i)
first, up to the number of Registrable Securities requested to be included in
such Demand Registration by the Stockholders, which, in the opinion of the
underwriter can be sold without adversely affecting the marketability of the
offering, pro rata among such Stockholders requesting such Demand Registration
on the basis of the number of such securities requested to be included by such
Stockholders and such Stockholders that are Piggyback Sellers; (ii) second,
securities the Company proposes to sell; and (iii) third, all other securities
of the Company duly requested to be included in such registration statement, pro
rata on the basis of the amount of such other securities requested to be
included or such other method determined by the Company.

               (h) Anytime that a Demand Registration involves an Underwritten
Offering, the Company shall select the investment banker or investment bankers
and managers that will serve as lead and co-managing underwriters with respect
to the offering of such Registrable Securities.

          Section 5.2 Piggyback Registrations.

               (a) Subject to the terms and conditions hereof, whenever the
Company proposes to register any of its equity securities under the Securities
Act (other than a registration by the Company on a registration statement on
Form S-4 or a registration statement on Form S-8 or any successor forms thereto)
(a "Piggyback Registration"), whether for its own account or for the account of
others, the Company shall give the Piggyback Stockholders prompt written notice
thereof (but not less than ten business days prior to the filing by the Company
with the Commission of any registration statement with respect thereto). Such
notice (a "Piggyback Notice") shall specify, at a minimum, the number of equity
securities proposed to be registered, the proposed date of filing of such
registration statement with the Commission, the proposed means of distribution,
the proposed managing underwriter or underwriters (if any and if known) and a
good faith estimate by the Company of the proposed minimum offering price of
such equity securities. Upon the written request of any Persons that on the date
of the Piggyback Notice constitute a Piggyback Stockholder (a "Piggyback
Seller") (which

                                       12
<PAGE>
written request shall specify the number of Registrable Securities then
presently intended to be disposed of by such Piggyback Seller) given within ten
days after such Piggyback Notice is received by such Piggyback Seller, the
Company, subject to the terms and conditions of this Agreement, shall use its
reasonable best efforts to cause all such Registrable Securities held by
Piggyback Sellers with respect to which the Company has received such written
requests for inclusion to be included in such Piggyback Registration on the same
terms and conditions as the Company's equity securities being sold in such
Piggyback Registration.

               (b) If, in connection with a Piggyback Registration, any managing
underwriter (or, if such Piggyback Registration is not an Underwritten Offering,
a nationally recognized independent investment bank selected by FIG Advisors or
any of the Permitted Transferees of either of the Fortress Stockholders (to the
extent a Stockholder hereunder), reasonably acceptable to the Company, and whose
fees and expenses shall be borne solely by the Company) advises the Company in
writing that, in its opinion, the inclusion of all the equity securities sought
to be included in such Piggyback Registration by (i) the Company, (ii) others
who have sought to have equity securities of the Company registered in such
Piggyback Registration pursuant to rights to demand (other than pursuant to
so-called "piggyback" or other incidental or participation registration rights)
such registration (such Persons being "Other Demanding Sellers"), (iii) the
Piggyback Sellers and (iv) any other proposed sellers of equity securities of
the Company (such Persons being "Other Proposed Sellers"), as the case may be,
would adversely affect the marketability of the equity securities sought to be
sold pursuant thereto, then the Company shall include in the registration
statement applicable to such Piggyback Registration only such equity securities
as the Company is so advised by such underwriter can be sold without such an
effect, as follows and in the following order of priority:

                    (i) if the Piggyback Registration relates to an offering for
the Company's own account, then (A) first, such number of equity securities to
be sold by the Company as the Company, in its reasonable judgment and acting in
good faith and in accordance with sound financial practice, shall have
determined, (B) second, Registrable Securities of Piggyback Sellers, securities
sought to be registered by Other Demanding Sellers and Additional Shares of
Additional Sellers (if any), pro rata on the basis of the number of shares of
Common Stock held by such Piggyback Sellers and Additional Sellers and (C)
third, other equity securities held by any Other Proposed Sellers; or

                    (ii) if the Piggyback Registration relates to an offering
other than for the Company's own account, then (A) first, such number of equity
securities sought to be registered by each Other Demanding Seller, the Piggyback
Sellers and the Additional Sellers (if any), pro rata in proportion to the
number of securities sought to be registered by all such Other Demanding
Sellers, Piggyback Sellers and Additional Sellers and (B) second, other equity
securities held by any Other Proposed Sellers or to be sold by the Company as
determined by the Company.

               (c) In connection with any Underwritten Offering under this
Section 5.2 for the Company's account, the Company shall not be required to
include a

                                       13
<PAGE>
holder's Registrable Securities in the Underwritten Offering unless such holder
accepts the terms of the underwriting as agreed upon between the Company and the
underwriters selected by the Company; provided, that any such underwriting
agreement includes only customary terms and conditions.

               (d) If, at any time after giving written notice of its intention
to register any of its equity securities as set forth in this Section 5.2 and
prior to the time the registration statement filed in connection with such
Piggyback Registration is declared effective, the Company shall determine for
any reason not to register such equity securities, the Company may, at its
election, give written notice of such determination to each Piggyback
Stockholder and thereupon shall be relieved of its obligation to register any
Registrable Securities in connection with such particular withdrawn or abandoned
Piggyback Registration (but not from its obligation to pay the Registration
Expenses in connection therewith as provided herein); provided, that
Stockholders may continue the registration as a Demand Registration pursuant to
the terms of Section 5.1.

          Section 5.3 Shelf Registration.

               (a) Subject to Section 5.3(d), and further subject to the
availability of a Registration Statement on Form S-3 ("Form S-3") to the
Company, each of the Fortress Stockholders and HP or any of their respective
Permitted Transferees (in each case to the extent a Stockholder hereunder) may
by written notice delivered to the Company (the "Shelf Notice") require the
Company to file as soon as practicable (but no later than 60 days after the date
the Shelf Notice is delivered), and to use commercially reasonable efforts to
cause to be declared effective by the Commission (within 90 days after such
filing date), a Form S-3 providing for an offering to be made on a continuous
basis pursuant to Rule 415 under the Securities Act relating to the offer and
sale, from time to time, of the Registrable Securities owned by the Fortress
Stockholders or HP (or any of their Permitted Transferees), as the case may be,
and any other Persons that at the time of the Shelf Notice meet the definition
of a Stockholder who elect to participate therein as provided in Section 5.3(b)
in accordance with the plan and method of distribution set forth in the
prospectus included in such Form S-3 (the "Shelf Registration Statement").

               (b) Within five business days after receipt of a Shelf Notice
pursuant to Section 5.3(a), the Company will deliver written notice thereof to
each Stockholder. Each Stockholder may elect to participate in the Shelf
Registration Statement by delivering to the Company a written request to so
participate within ten days after the Shelf Notice is received by any such
Stockholder.

               (c) Subject to Section 5.3(d), the Company will use commercially
reasonable efforts to keep the Shelf Registration Statement continuously
effective until the earlier of (i) one year after the Shelf Registration
Statement has been declared effective; and (ii) the date on which all
Registrable Securities covered by the Shelf Registration Statement have been
sold thereunder in accordance with the plan and method of distribution disclosed
in the prospectus included in the Shelf Registration Statement, or otherwise.

                                       14
<PAGE>
               (d) Notwithstanding anything to the contrary contained in this
Agreement, the Company shall be entitled, from time to time, by providing
written notice to the Stockholders who elected to participate in the Shelf
Registration Statement, to require such Stockholders to suspend the use of the
prospectus for sales of Registrable Securities under the Shelf Registration
Statement for a reasonable period of time not to exceed 60 days in succession or
90 days in the aggregate in any 12 month period (a "Suspension Period") if the
Company shall determine that it is required to disclose in the Shelf
Registration Statement a financing, acquisition, corporate reorganization or
other similar corporate transaction or other material event or circumstance
affecting the Company or its securities, and that the disclosure of such
information at such time would be detrimental to the Company or its
stockholders. Immediately upon receipt of such notice, the Stockholders covered
by the Shelf Registration Statement shall suspend the use of the prospectus
until the requisite changes to the prospectus have been made as required below.
Any Suspension Period shall terminate at such time as the public disclosure of
such information is made. After the expiration of any Suspension Period and
without any further request from a Stockholder, the Company shall as promptly as
reasonably practicable prepare a post-effective amendment or supplement to the
Shelf Registration Statement or the prospectus, or any document incorporated
therein by reference, or file any other required document so that, as thereafter
delivered to purchasers of the Registrable Securities included therein, the
prospectus will not include an untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading.

          Section 5.4 Withdrawal Rights. Any Stockholder having notified or
directed the Company to include any or all of its Registrable Securities in a
registration statement under the Securities Act shall have the right to withdraw
any such notice or direction with respect to any or all of the Registrable
Securities designated by it for registration by giving written notice to such
effect to the Company prior to the effective date of such registration
statement. In the event of any such withdrawal, the Company shall not include
such Registrable Securities in the applicable registration and such Registrable
Securities shall continue to be Registrable Securities for all purposes of this
Agreement. No such withdrawal shall affect the obligations of the Company with
respect to the Registrable Securities not so withdrawn; provided, however, that
in the case of a Demand Registration, if such withdrawal shall reduce the number
of Registrable Securities sought to be included in such registration below the
Registrable Amount, then the Company shall as promptly as practicable give each
holder of Registrable Securities sought to be registered notice to such effect
and, within ten days following the mailing of such notice, such holder of
Registrable Securities still seeking registration shall, by written notice to
the Company, elect to register additional Registrable Securities, when taken
together with elections to register Registrable Securities by its Affiliates, to
satisfy the Registrable Amount or elect that such registration statement not be
filed or, if theretofore filed, be withdrawn. During such ten day period, the
Company shall not file such registration statement if not theretofore filed or,
if such registration statement has been theretofore filed, the Company shall not
seek, and shall use commercially reasonable efforts to prevent, the
effectiveness thereof. Any registration statement withdrawn or not filed (a) in
accordance with an election by the Company, (b) in

                                       15
<PAGE>
accordance with an election by the Requesting Stockholders in the case of a
Demand Registration or by the Fortress Stockholders, HP or their respective
Permitted Transferees (in each case to the extent a Stockholder hereunder) with
respect to a Shelf Registration Statement or (c) in accordance with an election
by the Company subsequent to the effectiveness of the applicable Demand
Registration statement because any post-effective amendment or supplement to the
applicable Demand Registration statement contains information regarding the
Company which the Company deems adverse to the Company, shall not be counted as
a Demand.

          Section 5.5 Holdback Agreements. Each Stockholder agrees not to effect
any public sale or distribution (including sales pursuant to Rule 144) of equity
securities of the Company, or any securities convertible into or exchangeable or
exercisable for such equity securities, during any time period reasonably
requested by the Company (which shall not exceed 90 days) with respect to any
Public Offering, Demand Registration or Piggyback Registration (in each case,
except as part of such registration), or, in each case, a later date required by
any underwriting agreement with respect thereto.

          Section 5.6 Registration Procedures.

               (a) If and whenever the Company is required to use commercially
reasonable efforts to effect the registration of any Registrable Securities
under the Securities Act as provided in Sections 5.1, 5.2 and 5.3 the Company
shall as expeditiously as reasonably possible:

                    (i) prepare and file with the Commission a registration
statement to effect such registration and thereafter use commercially reasonable
efforts to cause such registration statement to become and remain effective
pursuant to the terms of this Agreement; provided, however, that the Company may
discontinue any registration of its securities which are not Registrable
Securities at any time prior to the effective date of the registration statement
relating thereto; provided, further that before filing such registration
statement or any amendments thereto, the Company will furnish to the counsel
selected by the holders of Registrable Securities which are to be included in
such registration ("Selling Holders") copies of all such documents proposed to
be filed, which documents will be subject to the review of such counsel, and
such review to be conducted with reasonable promptness;

                    (ii) prepare and file with the Commission such amendments
and supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration statement
effective and to comply with the provisions of the Securities Act with respect
to the disposition of all securities covered by such registration statement
until the earlier of such time as all of such securities have been disposed of
in accordance with the intended methods of disposition by the seller or sellers
thereof set forth in such registration statement or (i) in the case of a Demand
Registration pursuant to Section 5.1, the expiration of 60 days after such
registration statement becomes effective or (ii) in the case of a Piggyback
Registration pursuant to Section 5.2, the expiration of 60 days after such
registration

                                       16
<PAGE>
statement becomes effective or (iii) in the case of a Shelf Registration
pursuant to Section 5.3, the expiration of one year after such registration
statement becomes effective;

                    (iii) furnish to each Selling Holder and each underwriter,
if any, of the securities being sold by such Selling Holder such number of
conformed copies of such registration statement and of each amendment and
supplement thereto (in each case including all exhibits), such number of copies
of the prospectus contained in such registration statement (including each
preliminary prospectus and any summary prospectus) and any other prospectus
filed under Rule 424 under the Securities Act, in conformity with the
requirements of the Securities Act, and such other documents as such Selling
Holder and underwriter, if any, may reasonably request in order to facilitate
the public sale or other disposition of the Registrable Securities owned by such
seller;

                    (iv) use commercially reasonable efforts to register or
qualify such Registrable Securities covered by such registration statement under
such other securities laws or blue sky laws of such jurisdictions as any Selling
Holder and any underwriter of the securities being sold by such Selling Holder
shall reasonably request, and take any other action which may be reasonably
necessary or advisable to enable such Selling Holder and underwriter to
consummate the disposition in such jurisdictions of the Registrable Securities
owned by such Selling Holder, except that the Company shall not for any such
purpose be required to qualify generally to do business as a foreign corporation
in any jurisdiction wherein it would not but for the requirements of this clause
(iv) be obligated to be so qualified, to subject itself to taxation in any such
jurisdiction or to file a general consent to service of process in any such
jurisdiction;

                    (v) use commercially reasonable efforts to cause such
Registrable Securities to be listed on each securities exchange on which similar
securities issued by the Company are then listed and, if no such securities are
so listed, use commercially reasonable efforts to cause such Registrable
Securities to be listed on the New York Stock Exchange, the American Stock
Exchange or the Nasdaq Stock Market;

                    (vi) use commercially reasonable efforts to cause such
Registrable Securities covered by such registration statement to be registered
with or approved by such other governmental agencies or authorities as may be
necessary to enable the Selling Holder(s) thereof to consummate the disposition
of such Registrable Securities;

                    (vii) in connection with an Underwritten Offering, obtain
for each Selling Holder and underwriter:

                         (1) an opinion of counsel for the Company, covering the
     matters customarily covered in opinions requested in underwritten offerings
     and such other matters as may be reasonably requested by such Selling
     Holder and underwriters, and

                         (2) a "comfort" letter (or, in the case of any such
     Person which does not satisfy the conditions for receipt of a

                                       17
<PAGE>
     "comfort" letter specified in Statement on Auditing Standards No. 72, an
     "agreed upon procedures" letter) signed by the independent public
     accountants who have certified the Company's financial statements included
     in such registration statement;

                    (viii) promptly make available for inspection by any seller,
any underwriter participating in any disposition pursuant to any registration
statement, and any attorney, accountant or other agent or representative
retained by any such seller or underwriter (collectively, the "Inspectors"), all
financial and other records, pertinent corporate documents and properties of the
Company (collectively, the "Records"), as shall be reasonably necessary to
enable them to exercise their due diligence responsibility, and cause the
Company's officers, directors and employees to supply all information requested
by any such Inspector in connection with such registration statement; provided,
however, that, unless the disclosure of such Records is necessary to avoid or
correct a misstatement or omission in the registration statement or the release
of such Records is ordered pursuant to a subpoena or other order from a court of
competent jurisdiction, the Company shall not be required to provide any
information under this subparagraph (viii) if (i) the Company believes, after
consultation with counsel for the Company, that to do so would cause the Company
to forfeit an attorney-client privilege that was applicable to such information
or (ii) if either (A) the Company has requested and been granted from the SEC
confidential treatment of such information contained in any filing with the SEC
or documents provided supplementally or otherwise or (B) the Company reasonably
determines in good faith that such Records are confidential and so notifies the
Inspectors in writing unless prior to furnishing any such information with
respect to (i) or (ii) such Holder of Registrable Securities requesting such
information agrees, and causes each of its Inspectors, to enter into a
confidentiality agreement on terms reasonably acceptable to the Company; and
provided, further, that each Holder of Registrable Securities agrees that it
will, upon learning that disclosure of such Records is sought in a court of
competent jurisdiction, give notice to the Company and allow the Company, at its
expense, to undertake appropriate action and to prevent disclosure of the
Records deemed confidential;

                    (ix) promptly notify in writing each Selling Holder and the
underwriters, if any, of the following events:

                         (1) the filing of the registration statement, the
     prospectus or any prospectus supplement related thereto or post-effective
     amendment to the registration statement, and, with respect to the
     registration statement or any post-effective amendment thereto, when the
     same has become effective;

                         (2) any request by the Commission for amendments or
     supplements to the registration statement or the prospectus or for
     additional information;

                                       18
<PAGE>
                         (3) the issuance by the Commission of any stop order
     suspending the effectiveness of the registration statement or the
     initiation of any proceedings by any Person for that purpose; and

                         (4) the receipt by the Company of any notification with
     respect to the suspension of the qualification of any Registrable
     Securities for sale under the securities or blue sky laws of any
     jurisdiction or the initiation or threat of any proceeding for such
     purpose;

                    (x) notify each Selling Holder, at any time when a
prospectus relating thereto is required to be delivered under the Securities
Act, upon discovery that, or upon the happening of any event as a result of
which, the prospectus included in such registration statement, as then in
effect, includes an untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading, and, at the request of any Selling Holder, promptly
prepare and furnish to such seller a reasonable number of copies of a supplement
to or an amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such Registrable Securities, such prospectus
shall not include an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading;

                    (xi) make every reasonable effort to obtain the withdrawal
of any order suspending the effectiveness of such registration statement;

                    (xii) otherwise use commercially reasonable efforts to
comply with all applicable rules and regulations of the Commission, and make
available to Selling Holders, as soon as reasonably practicable, an earnings
statement covering the period of at least 12 months, but not more than 18
months, beginning with the first day of the Company's first full quarter after
the effective date of such registration statement, which earnings statement
shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder;

                    (xiii) use its reasonable best efforts to assist
Stockholders who made a request to the Company to provide for a third party
"market maker" for the Common Stock; provided, however, that the Company shall
not be required to serve as such "market maker";

                    (xiv) cooperate with the sellers and the managing
underwriter to facilitate the timely preparation and delivery of certificates
(which shall not bear any restrictive legends unless required under applicable
law) representing securities sold under any registration statement, and enable
such securities to be in such denominations and registered in such names as the
managing underwriter or such sellers may request and keep available and make
available to the Company's transfer agent prior to the effectiveness of such
registration statement a supply of such certificates; and

                    (xv) have appropriate officers of the Company prepare and
make presentations at any "road shows" and before analysts and rating agencies,
as the

                                       19
<PAGE>
case may be, take other actions to obtain ratings for any Registrable Securities
(if they are eligible to be rated) and otherwise use its reasonable best efforts
to cooperate as reasonably requested by the Selling Holders and the underwriters
in the offering, marketing or selling of the Registrable Securities.

     The Company may require each Selling Holder and each underwriter, if any,
to furnish the Company in writing such information regarding each Selling Holder
or underwriter and the distribution of such Registrable Securities as the
Company may from time to time reasonably request to complete or amend the
information required by such registration statement.

               (b) Without limiting any of the foregoing, in the event that the
offering of Registrable Securities is to be made by or through an underwriter,
the Company shall enter into an underwriting agreement with a managing
underwriter or underwriters containing representations, warranties, indemnities
and agreements customarily included (but not inconsistent with the covenants and
agreements of the Company contained herein) by an issuer of common stock in
underwriting agreements with respect to offerings of common stock for the
account of, or on behalf of, such issuers. In connection with any offering of
Registrable Securities registered pursuant to this Agreement, the Company shall
(i) furnish to the underwriter, if any (or, if no underwriter, the sellers of
such Registrable Securities), unlegended certificates representing ownership of
the Registrable Securities being sold, in such denominations as requested and
(ii) instruct any transfer agent and registrar of the Registrable Securities to
release any stop transfer order with respect thereto.

               (c) Each Selling Holder agrees that upon receipt of any notice
from the Company of the happening of any event of the kind described in Section
5.6(a)(ix), such Selling Holder shall forthwith discontinue such Selling
Holder's disposition of Registrable Securities pursuant to the applicable
registration statement and prospectus relating thereto until such Selling
Holder's receipt of the copies of the supplemented or amended prospectus
contemplated by Section 5.6(a)(ix) and, if so directed by the Company, deliver
to the Company, at the Company's expense, all copies, other than permanent file
copies, then in such Selling Holder's possession of the prospectus current at
the time of receipt of such notice relating to such Registrable Securities. In
the event the Company shall give such notice, any applicable 60 day or one year
period during which such registration statement must remain effective pursuant
to this Agreement shall be extended by the number of days during the period from
the date of giving of a notice regarding the happening of an event of the kind
described in Section 5.6(a)(ix) to the date when all such Selling Holders shall
receive such a supplemented or amended prospectus and such prospectus shall have
been filed with the Commission.

          Section 5.7 Registration Expenses. All expenses incident to the
Company's performance of, or compliance with, its obligations under this
Agreement including, without limitation, all registration and filing fees, all
fees and expenses of compliance with securities and "blue sky" laws, all fees
and expenses associated with filings required to be made with the NASD
(including, if applicable, the fees and expenses of any "qualified independent
underwriter" as such term is defined in Schedule

                                       20
<PAGE>
E of the By-Laws of the NASD), all fees and expenses of compliance with
securities and "blue sky" laws, all printing (including, without limitation,
expenses of printing certificates for the Registrable Securities in a form
eligible for deposit with the Depository Trust Company and of printing
prospectuses if the printing of prospectuses is requested by a holder of
Registrable Securities) and copying expenses, all messenger and delivery
expenses, all fees and expenses of the Company's independent certified public
accountants and counsel (including, without limitation, with respect to
"comfort" letters and opinions) and fees and expenses of one firm of counsel to
the Stockholders selling in such registration (which firm shall be selected by
the Stockholders selling in such registration that hold a majority of the
Registrable Securities included in such registration) (collectively, the
"Registration Expenses") shall be borne by the Company, regardless of whether a
registration is effected. The Company will 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 annual audit and the
expense of any liability insurance) and the expenses and fees for listing the
securities to be registered on each securities exchange and included in each
established over-the-counter market on which similar securities issued by the
Company are then listed or traded. Each Selling Holder shall pay its portion of
all underwriting discounts and commissions and transfer taxes, if any, relating
to the sale of such Selling Holder's Registrable Securities pursuant to any
registration.

          Section 5.8 Indemnification.

               (a) The Company agrees to indemnify and hold harmless, to the
fullest extent permitted by law, each Selling Holder, its officers, directors,
employees, managers, partners and agents and each Person who controls (within
the meaning of Section 15 of the Securities Act and Section 20 of the Exchange
Act) such Selling Holder or such other indemnified Person from and against all
losses, claims, damages, liabilities and expenses (including reasonable expenses
of investigation and reasonable attorneys' fees and expenses) (collectively, the
"Losses") caused by, resulting from or relating to any untrue statement (or
alleged untrue statement) of a material fact contained in any registration
statement, prospectus or preliminary prospectus or any amendment thereof or
supplement thereto or any omission (or alleged omission) of a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading, except
insofar as the same are caused by any information furnished in writing to the
Company by such Selling Holder expressly for use therein or by such Selling
Holder's failure to deliver a copy of a current prospectus or any amendments or
supplements thereto (which does not contain any such material misstatements or
omissions) after the Company has furnished such holder with a sufficient number
of copies of the same. In connection with an Underwritten Offering and without
limiting any of the Company's other obligations under this Agreement, the
Company shall also indemnify such underwriters, their officers, directors,
employees and agents and each Person who controls (within the meaning of Section
15 of the Securities Act and Section 20 of the Exchange Act) such underwriters
or such other indemnified Person to the same extent as provided above with
respect to the indemnification (and exceptions thereto) of the holders of
Registrable Securities being sold. Reimbursements payable pursuant to the
indemnification contemplated by this Section 5.8(a) will be made

                                       21
<PAGE>
by periodic payments during the course of any investigation or defense, as and
when bills are received or expenses incurred.

               (b) In connection with any registration statement in which a
holder of Registrable Securities is participating, each such Selling Holder will
furnish to the Company in writing information regarding such Selling Holder's
ownership of Registrable Securities and its intended method of distribution
thereof and, to the extent permitted by law, shall, severally and not jointly,
indemnify the Company, its directors, officers, employees and agents and each
Person who controls (within the meaning of Section 15 of the Securities Act and
Section 20 of the Exchange Act) the Company or such other indemnified Person
against all Losses caused by any untrue statement of material fact contained in
the registration statement, prospectus or preliminary prospectus or any
amendment thereof or supplement thereto or any omission of a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading, but only
to the extent that such untrue statement or omission is caused by and contained
in such information so furnished in writing by such Selling Holder expressly for
use therein; provided, however, that each Selling Holder's obligation to
indemnify the Company hereunder shall, to the extent more than one Selling
Holder is subject to the same indemnification obligation, be apportioned between
each Selling Holder based upon the net amount received by each Selling Holder
from the sale of Registrable Securities, as compared to the total net amount
received by all of the Selling Holders of Registrable Securities sold pursuant
to such registration statement. Notwithstanding the foregoing, no Selling Holder
shall be liable to the Company for amounts in excess of the lesser of (i) such
apportionment and (ii) the amount received by such holder in the offering giving
rise to such liability.

               (c) Any Person entitled to indemnification hereunder shall give
prompt written notice to the indemnifying party of any claim with respect to
which it seeks indemnification; provided, however, the failure to give such
notice shall not release the indemnifying party from its obligation, except to
the extent that the indemnifying party has been materially prejudiced by such
failure to provide such notice on a timely basis.

               (d) In any case in which any such action is brought against any
indemnified party, and it notifies an indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein, and, to
the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel reasonably satisfactory to
such indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not (so long as it shall continue to have the right to
defend, contest, litigate and settle the matter in question in accordance with
this paragraph) be liable to such indemnified party hereunder for any legal or
other expense subsequently incurred by such indemnified party in connection with
the defense thereof other than reasonable costs of investigation, supervision
and monitoring (unless (i) such indemnified party reasonably objects to such
assumption on the grounds that there may be defenses available to it which are
different from or in addition to the defenses available to such indemnifying
party or (ii) the indemnifying party shall have failed

                                       22
<PAGE>
within a reasonable period of time to assume such defense and the indemnified
party is or is reasonably likely to be prejudiced by such delay, in either event
the indemnified party shall be promptly reimbursed by the indemnifying party for
the expenses incurred in connection with retaining separate legal counsel). An
indemnifying party shall not be liable for any settlement of an action or claim
effected without its consent. The indemnifying party shall lose its right to
defend, contest, litigate and settle a matter if it shall fail to diligently
contest such matter (except to the extent settled in accordance with the next
following sentence). No matter shall be settled by an indemnifying party without
the consent of the indemnified party (which consent shall not be unreasonably
withheld, it being understood that the indemnified party shall not be deemed to
be unreasonable in withholding its consent if the proposed settlement imposes
any obligation on the indemnified party other than the payment of money).

               (e) 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 Person and will survive the transfer of the
Registrable Securities and the termination of this Agreement.

               (f) If recovery is not available under the foregoing
indemnification provisions for any reason or reasons other than as specified
therein, any Person who would otherwise be entitled to indemnification by the
terms thereof shall nevertheless be entitled to contribution with respect to any
Losses with respect to which such Person would be entitled to such
indemnification but for such reason or reasons. In determining the amount of
contribution to which the respective Persons are entitled, there shall be
considered the Persons' relative knowledge and access to information concerning
the matter with respect to which the claim was asserted, the opportunity to
correct and prevent any statement or omission, and other equitable
considerations appropriate under the circumstances. It is hereby agreed that it
would not necessarily be equitable if the amount of such contribution were
determined by pro rata or per capita allocation. 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 found guilty of
such fraudulent misrepresentation. Notwithstanding the foregoing, no Selling
Holder or transferee thereof shall be required to make a contribution in excess
of the net amount received by such holder from its sale of Registrable
Securities in connection with the offering that gave rise to the contribution
obligation.

               (g) Not less than five business days before the expected filing
date of each registration statement pursuant to this Agreement, the Company
shall notify each Stockholder who has timely provided the requisite notice
hereunder entitling the Stockholder to register Registrable Securities in such
registration statement of the information, documents and instruments from such
Stockholder that the Company or any underwriter reasonably requests in
connection with such registration statement, including, but not limited to a
questionnaire, custody agreement, power of attorney, lock-up letter and
underwriting agreement (the "Requested Information"). If the Company has not
received, on or before the second day before the expected filing date, the
Requested Information from such Stockholder, the Company may file the
Registration Statement without including Registrable Securities of such
Stockholder. The failure to so include in

                                       23
<PAGE>
any registration statement the Registrable Securities of a Stockholder (with
regard to that registration statement) shall not in and of itself result in any
liability on the part of the Company to such Stockholder.

                                   ARTICLE VI

                                  MISCELLANEOUS

          Section 6.1 Headings. The headings in this Agreement are for
convenience of reference only and shall not control or effect the meaning or
construction of any provisions hereof.

          Section 6.2 Entire Agreement. This Agreement constitute the entire
agreement and understanding of the parties hereto in respect of the subject
matter contained herein, and there are no restrictions, promises,
representations, warranties, covenants, conditions or undertakings with respect
to the subject matter hereof, other than those expressly set forth or referred
to herein. This Agreement supersedes all prior agreements and understandings
between the parties hereto with respect to the subject matter hereof.

          Section 6.3 Further Actions; Cooperation. Each of the Stockholders
agrees to use its reasonable efforts to take, or cause to be taken, all actions
and to do, or cause to be done, and to assist and cooperate with the other
parties in doing, all things necessary, proper or advisable to give effect to
the transactions contemplated by this Agreement. Without limiting the generality
of the foregoing, each of the Stockholders (i) acknowledges that the
Stockholders will prepare and file with the Commission filings under the
Exchange Act, including under Section 13(d) of the Exchange Act, relating to
their beneficial ownership of the Common Stock and (ii) agrees to use its
reasonable efforts to assist and cooperate with the other parties in promptly
preparing, reviewing and executing any such filings under the Exchange Act,
including any amendments thereto.

          Section 6.4 Notices. All notices, requests, consents and other
communications hereunder to any party shall be deemed to be sufficient if
contained in a written instrument delivered in person or sent by telecopy,
nationally recognized overnight courier or first class registered or certified
mail, return receipt requested, postage prepaid, addressed to such party at the
address set forth below or such other address as may hereafter be designated on
the signature pages of this Agreement or in writing by such party to the other
parties:

          (a)  If to any of the Fortress Stockholders, to:

                    c/o Fortress Investment Group, LLC
                    1251 Avenue of the Americas, 16th Floor
                    New York, NY 10020
                    Fax: (212) 798-6122
                    Attn: Randal A. Nardone

                                       24
<PAGE>
               with a copy (which shall not constitute notice) to:

                    Skadden, Arps, Slate, Meagher & Flom LLP
                    4 Times Square
                    New York, NY 10036-6522
                    Fax: (212) 735-2000
                    Attn: Joseph A. Coco, Esq.

          (b)  If to HP:

                    c/o Capital Z Management
                    54 Thompson Street
                    New York, New York 10012
                    Fax: (212) 965-2411
                    Attn: Mani A. Sadeghi and Joseph R. Tomei

               with a copy (which shall not constitute notice) to:

                    Weil, Gotshal & Manges LLP
                    767 Fifth Avenue
                    New York, New York 10153
                    Fax: (212) 310-8007
                    Attn: Douglas P. Warner, Esq.

          (c)  If a Stockholder that is not an Initial Stockholder, then to the
               address set forth on such Stockholder's signature page hereto.

A copy of each notice delivered pursuant to this Agreement shall be delivered to
the Company in accordance with this Section 6.4 at the following address:

                    Brookdale Senior Living Inc.
                    330 N. Wabash, Suite 1400
                    Chicago, IL 60611
                    Fax: (866) 326-9975
                    Attn: Deborah C. Paskin, Esq.

               with a copy (which shall not constitute notice) to:

                    Fortress Investment Group, LLC
                    1251 Avenue of the Americas, 16th Floor
                    New York, NY 10020
                    Fax: (212) 798-6122
                    Attn: Randal A. Nardone

                    and

                                       25
<PAGE>
                    Skadden, Arps, Slate, Meagher & Flom LLP
                    4 Times Square
                    New York, NY 10036-6522
                    Fax: (212) 735-2000
                    Attn: Joseph A. Coco, Esq.

All such notices, requests, consents and other communications shall be deemed to
have been given or made if and when received (including by overnight courier) by
the parties at the above addresses or sent by electronic transmission, with
confirmation received, to the telecopy numbers specified above (or at such other
address or telecopy number for a party as shall be specified by like notice).
Any notice delivered by any party hereto to any other party hereto shall also be
delivered to each other party hereto simultaneously with delivery to the first
party receiving such notice.

          Section 6.5 Applicable Law. The substantive laws of the State of
Delaware shall govern the interpretation, validity and performance of the terms
of this Agreement, without regard to conflicts of law doctrines. THE PARTIES
HERETO WAIVE THEIR RIGHT TO A JURY TRIAL WITH RESPECT TO DISPUTES HEREUNDER.

          Section 6.6 Severability. The invalidity, illegality or
unenforceability of one or more of the provisions of this Agreement in any
jurisdiction shall not affect the validity, legality or enforceability of the
remainder of this Agreement, including any such provisions, in any other
jurisdiction, it being intended that all rights and obligations of the parties
hereunder shall be enforceable to the fullest extent permitted by law.

          Section 6.7 Successors and Assigns. Except as otherwise provided
herein, all the terms and provisions of this Agreement shall be binding upon,
shall inure to the benefit of and shall be enforceable by the respective
successors and permitted assigns of the parties hereto. No Stockholder may
assign any of its rights hereunder to any Person other than a Permitted
Transferee that has complied in all respects with the requirements of this
Agreement (including, without limitation, Section 2.1). Except as otherwise
provided in Section 2.1, each Permitted Transferee of any Stockholder, shall be
subject to all of the terms of this Agreement, and by taking and holding such
shares such Person shall be entitled to receive the benefits of and be
conclusively deemed to have agreed to be bound by and to comply with all of the
terms and provisions of this Agreement; provided, however, no transfer of rights
permitted hereunder shall be binding upon or obligate the Company unless and
until (i) the Company shall have received written notice of such transfer, (ii)
such transferee can establish beneficial ownership or ownership of record of
Company Securities (whether individually or together with its Affiliates that
are Stockholders or transferees of Stockholders and, if applicable, its other
Permitted Transferees that are Stockholders or transferees of Stockholders) and
(iii) with respect to the rights set forth in Article V hereof, such transferee
can establish beneficial ownership or ownership of record of a Registrable
Amount (whether individually or together with its Affiliates that are
Stockholders or transferees of Stockholders and, if applicable, its other
Permitted Transferees that are Stockholders or transferees of Stockholders). The
Company may not assign any of its rights or obligations hereunder

                                       26
<PAGE>
without the prior written consent of each of the Stockholders. Notwithstanding
the foregoing, no successor or assignee of the Company shall have any rights
granted under this Agreement until such Person shall acknowledge its rights and
obligations hereunder by a signed written statement of such Person's acceptance
of such rights and obligations.

          Section 6.8 Amendments. This Agreement may not be amended, modified or
supplemented unless such amendment, modification or supplement is in writing and
signed by each of the Stockholders and the Company.

          Section 6.9 Waiver. The failure of a party hereto at any time or times
to require performance of any provision hereof shall in no manner affect its
right at a later time to enforce the same. No waiver by a party of any condition
or of any breach of any term, covenant, representation or warranty contained in
this Agreement shall be effective unless in a writing signed by the party
against whom the waiver is to be effective, and no waiver in any one or more
instances shall be deemed to be a further or continuing waiver of any such
condition or breach in other instances or a waiver of any other condition or
breach of any other term, covenant, representation or warranty.

          Section 6.10 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original but all of which
shall constitute one and the same Agreement.

          Section 6.11 SUBMISSION TO JURISDICTION. ANY LEGAL ACTION OR
PROCEEDING WITH RESPECT TO THIS AGREEMENT AND ANY ACTION FOR ENFORCEMENT OF ANY
JUDGMENT IN RESPECT THEREOF MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW
YORK OR OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK
AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH PARTY HERETO HEREBY
ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, THE NON-EXCLUSIVE JURISDICTION OF THE AFORESAID COURTS AND THE
APPELLATE COURTS THEREOF. EACH PARTY HERETO IRREVOCABLY CONSENTS TO THE SERVICE
OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR
PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL,
POSTAGE PREPAID, TO SUCH PARTY AT THE ADDRESS FOR NOTICES SET FORTH HEREIN. EACH
PARTY HERETO HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR
PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT BROUGHT IN THE
COURTS REFERRED TO ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO
PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN
ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

          Section 6.12 Injunctive Relief. Each party hereto acknowledges and
agrees that a violation of any of the terms of this Agreement will cause the
other parties

                                       27
<PAGE>
irreparable injury for which an adequate remedy at law is not available.
Therefore, the Stockholders agree that each party shall be entitled to, an
injunction, restraining order, specific performance or other equitable relief
from any court of competent jurisdiction, restraining any party from committing
any violations of the provisions of this Agreement.

          Section 6.13 Recapitalizations, Exchanges, Etc. Affecting the shares
of Common Stock; New Issuances. The provisions of this Agreement shall apply, to
the full extent set forth herein with respect to Company Securities and to any
and all equity or debt securities of the Company or any successor or assign of
the Company (whether by merger, consolidation, sale of assets, or otherwise)
which may be issued in respect of, in exchange for, or in substitution of, such
Company Securities and shall be appropriately adjusted for any stock dividends,
splits, reverse splits, combinations, reclassifications, recapitalizations,
reorganizations and the like occurring after the date hereof.

          Section 6.14 Termination. Upon the mutual consent of all of the
parties hereto or, with respect to each Stockholder, at such earlier time as
such Stockholder and its Affiliates and Permitted Transferees ceases to
beneficially own a Registrable Amount, the terms of this Agreement shall
terminate, and be of no further force and effect; provided, however, that the
following shall survive the termination of this Agreement: (i) the provisions of
Sections 5.2 (which shall terminate, and be of no further force and effect, with
respect to each Piggyback Stockholder, at such time as such Piggyback
Stockholder and its Affiliates and Permitted Transferees ceases to beneficially
own a Piggyback Registrable Amount), 5.7, 5.8, 6.5, 6.11, this Section 6.14 and
Section 6.15; (ii) the rights with respect to the breach of any provision hereof
by the Company and (iii) any registration rights vested or obligations accrued
as of the date of termination of this Agreement to the extent, in the case of
registration rights so vested, if such Stockholder ceases to meet the definition
of a Stockholder under this Agreement subsequent to the vesting of such
registration rights as a result of action taken by the Company; provided,
further, however that at any time each of HP and its Permitted Transferees may
elect, by written notice to the Company, to withdraw from this Agreement and as
a result of such withdrawal, such Stockholder shall no longer be entitled to the
rights, nor be subject to the obligations, of this Agreement and the Common
Stock held by such Stockholder shall conclusively be deemed thereafter not to be
"Registrable Securities" under this Agreement. In connection with any withdrawal
from the Agreement by HP, HP will cause its designee to the Company's Board to
tender his or her resignation contemporaneously with HP's withdrawal. No
withdrawal pursuant to this Section 6.14 shall release any Stockholder from its
indemnification and contribution rights and obligations, if any, pursuant to
Section 5.8 herein.

          Section 6.15 Rule 144. The Company covenants that it will file the
reports required to be filed by it under the Securities Act and the Exchange Act
and the rules and regulations adopted by the Commission thereunder (or, if it is
not required to file such reports, it will, upon the request of any holder of
Registrable Securities, make publicly available other information so long as
necessary to permit sales in compliance with Rule 144 under the Securities Act),
and it will take such further reasonable action, 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

                                       28
<PAGE>
provided by Rule 144 under the Securities Act, as such Rule 144 may be amended
from time to time, or any similar rule or regulation hereafter adopted by the
Commission. Upon the reasonable request of any holder of Registrable Securities,
the Company will deliver to such holder a written statement as to whether it has
complied with such information and filing requirements.

                  [Remainder of page left blank intentionally]

                                       29
<PAGE>
          IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered by their respective officers thereunto duly as of the
date first above written.

                                        BROOKDALE SENIOR LIVING INC.

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

                                        FIT-ALT INVESTOR LLC

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

                                        FORTRESS BROOKDALE ACQUISITION LLC

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

                                        FORTRESS INVESTMENT TRUST II

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

                                        HEALTH PARTNERS

                                        By: Capital Z Financial Services Fund
                                            II, L.P., its General Partner

                                        By: Capital Z Partners, L.P.,
                                            its General Partner

                                        By: Capital Z Partners, Ltd, its
<PAGE>
                                        General Partner

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

                                        2<PAGE>
                                                                     Exhibit 4.3

                                   ----------

                              GOVERNANCE AGREEMENT

                                  BY AND AMONG

                          BROOKDALE SENIOR LIVING INC.,

                       FORTRESS BROOKDALE ACQUISITION LLC,

                          FORTRESS INVESTMENT TRUST II

                                       and

                                 HEALTH PARTNERS

                                   ----------

                         Dated as of September 30, 2005
<PAGE>
<TABLE>
<S>                                                                           <C>
ARTICLE I DEFINITIONS......................................................    1
Section 1.1 Defined Terms..................................................    1

ARTICLE II TRANSFER RESTRICTIONS...........................................    9
Section 2.1 Restrictions on Transfer.......................................    9
Section 2.2 Binding Effect on Transferees..................................    9
Section 2.3 Additional Purchases...........................................   10
Section 2.4 Legend.........................................................   10

ARTICLE III CORPORATE GOVERNANCE...........................................   10
Section 3.1 Board of Directors.............................................   10

ARTICLE IV BUY/SELL RIGHT..................................................   11
Section 4.1 Buy/Sell Rights................................................   11
Section 4.2 Delivery of Notice.............................................   11
Section 4.3 Contents of Notice.............................................   11
Section 4.4 Election.......................................................   12
Section 4.5 Closing........................................................   12
Section 4.6 Failure to Purchase Securities.................................   13
Section 4.7 No Restrictions or Encumbrances................................   13
Section 4.8 Company Securities of Emeritus and NW Select...................   13
Section 4.9 Termination of Buy/Sell Right..................................   13

ARTICLE V TAG-ALONG; DRAG-ALONG RIGHTS; RIGHT OF FIRST OFFER...............   13
Section 5.1 Tag-Along Rights...............................................   13
Section 5.2 Drag-Along Rights..............................................   15
Section 5.3 Right of First Offer...........................................   16

ARTICLE VI REPRESENTATIONS OF EACH STOCKHOLDER.............................   18
Section 6.1 Due Organization, Authorization................................   18
Section 6.2 Enforceability, Etc............................................   18
Section 6.3 No Conflicts...................................................   19
Section 6.4 Governmental Approvals.........................................   19
Section 6.5 Litigation.....................................................   19
ARTICLE VII INDEMNIFICATION................................................   19
Section 7.1 Indemnity......................................................   19
Section 7.2 Indemnity for Actions by or in Right of the Company............   20
</TABLE>

                                       2
<PAGE>
<TABLE>
<S>                                                                           <C>
Section 7.3 Indemnity if Successful........................................   20
Section 7.4 Expenses.......................................................   20
Section 7.5 Advance Payment of Expenses....................................   20
Section 7.6 Other Arrangements.............................................   20
Section 7.7 Additional Expenses............................................   21

ARTICLE VIII MISCELLANEOUS.................................................   22
Section 8.1 Headings.......................................................   22
Section 8.2 Entire Agreement...............................................   22
Section 8.3 Further Actions; Cooperation...................................   22
Section 8.4 Notices........................................................   22
Section 8.5 Applicable Law.................................................   24
Section 8.6 Severability...................................................   24
Section 8.7 Successors and Assigns.........................................   24
Section 8.8 Amendments.....................................................   24
Section 8.9 Waiver.........................................................   24
Section 8.10 Counterparts..................................................   24
Section 8.11 SUBMISSION TO JURISDICTION....................................   25
Section 8.12 Injunctive Relief.............................................   25
Section 8.13 Recapitalizations, Exchanges, Etc. Affecting the shares
                of Common Stock; New Issuances.............................   25
Section 8.14 Other Ventures................................................   25
Section 8.15 Termination...................................................   26

Schedule A - Terms of Initial Public Offering
</TABLE>

                                        3
<PAGE>
          THIS GOVERNANCE AGREEMENT (this "Agreement") is made as of September
30, 2005, by and among Brookdale Senior Living Inc., a Delaware corporation (the
"Company"), Fortress Brookdale Acquisition LLC, a Delaware limited liability
company ("FBA"), Fortress Investment Trust II, a Delaware business trust
("FIT"), and Health Partners, a Bermuda exempted partnership ("HP"). FBA, FIT
and HP are referred to herein individually as an "Initial Stockholder" and
collectively referred to herein as the "Initial Stockholders." Certain
capitalized terms used in this Agreement are defined in Article I. Unless
otherwise indicated, references to articles and sections shall be to articles
and sections of this Agreement.

          WHEREAS, each of the Initial Stockholders and the Company have entered
into the Conveyance Agreement, dated as of the date hereof (the "Conveyance
Agreement"), pursuant to which (i) the Company has issued shares of Common Stock
(as hereinafter defined) to FBA pursuant to the merger of Brookdale Living
Communities Inc. and a wholly-owned subsidiary of the Company, (ii) HP has
exchanged its membership interests in FBA for shares of Common Stock, (iii) FIT
has received beneficial ownership of shares of Common Stock pursuant to the
mergers of each of FEBC-ALT Investors LLC and Fortress CCRC Acquisition LLC into
wholly-owned subsidiaries of the Company, and (iv) HP has consented to the
Initial Public Offering (as defined below);

          WHEREAS, the Stockholders (as hereinafter defined) deem it in their
best interests and in the best interests of the Company to provide for certain
arrangements with respect to the management of the Company during the period
commencing on the date hereof and prior to the consummation of the Initial
Public Offering and desire to enter into this Agreement in order to effectuate
such purpose and to set forth certain of their respective rights and obligations
in connection with their investment in the Company.

          NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements set forth herein and for good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto hereby agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

          Section 1.1 Defined Terms. For purposes of this Agreement, the
following terms shall have the following meanings:

               (a) "Affiliate" shall have the meaning set forth in Rule 12b-2
promulgated under the Exchange Act; provided that no Stockholder shall be deemed
an Affiliate of any other Stockholder solely by reason of any investment in the
Company.

               (b) "Alterra Stock Plan" shall have the meaning assigned to it in
the Conveyance Agreement.
<PAGE>
               (c) "Annual Business Plan" means the annual business plan of the
Company approved by the Board in accordance with the provisions of Section
3.1(b) hereof.

               (d) "Approved Sale" shall have the meaning assigned to it in
Section 5.2(a).

               (e) "Bankruptcy" means, with respect to any Person, a "Voluntary
Bankruptcy" or an "Involuntary Bankruptcy". A "Voluntary Bankruptcy" shall mean,
with respect to any Person, (i) an admission in writing by such Person of its
inability to pay its debts generally or a general assignment by such Person for
the benefit of creditors, (ii) the filing of any petition or answer by such
Person seeking to adjudicate it a bankrupt or insolvent or seeking for itself
any liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief or composition of such Person or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of debtors, or
seeking, consenting to or acquiescing in the entry of an order for relief or the
appointment of a receiver, trustee, custodian or other similar official for such
Person or for any substantial part of its property, or (iii) corporate action
taken by such Person to authorize any of the actions set forth above. An
"Involuntary Bankruptcy" shall mean, with respect to any Person, without the
consent or acquiescence of such Person, the entering of an order for relief or
approving a petition for relief or reorganization or any other petition seeking
any reorganization, arrangement, composition, readjustment, liquidation,
dissolution or other similar relief under any present or future bankruptcy,
insolvency or similar statute, law or regulation or the filing of any such
petition against such Person which petition shall not be dismissed within ninety
(90) Business Days or, without the consent or acquiescence of such Person, the
entering of an order appointing a trustee, custodian, receiver or liquidator of
such Person or of all or any substantial part of the property of such Person
which order shall not be dismissed within sixty (60) Business Days.

               (f) A Person shall be deemed to "Beneficially Own" securities if
such Person is deemed to be a "beneficial owner" within the meaning of Rules
13d-3 and 13d-5 under the Exchange Act as in effect on the date of this
Agreement.

               (g) "Board" shall have the meaning assigned to it in Section
3.1(a).

               (h) "Brookdale" means Brookdale Living Communities, Inc., a
Delaware corporation.

               (i) "Business Day" means any day other than a Saturday, Sunday or
any other day on which banks in the City of New York are required or permitted
to be closed.

               (j) "Buy/Sell Event" means an event triggered by an
irreconcilable dispute concerning a Major Decision, which shall be deemed to
exist on the tenth day following receipt by the Company and the Initial
Stockholders of a written

                                       2
<PAGE>
notice setting forth the sending Initial Stockholder's good faith basis for
believing there is an irreconcilable dispute with respect to a Major Decision. A
Buy/Sell Event may only be initiated by an Initial Stockholder.

               (k) "Buy/Sell Notice" shall have the meaning assigned to it in
Section 4.2.

               (l) "Buy/Sell Price" shall have the meaning assigned to it in
Section 4.3.

               (m) "Buy/Sell Right" shall have the meaning assigned to it in
Section 4.1.

               (n) "Common Stock" shall mean the Company's common stock, par
value $0.01 per share and any and all securities of any kind whatsoever of the
Company which may be issued and outstanding on or after the date hereof in
respect of, in exchange for, or upon conversion of shares of Common Stock
pursuant to a merger, consolidation, stock split, stock dividend,
recapitalization of the Company or otherwise.

               (o) "Company" shall have the meaning assigned to it in the
introductory paragraph to this Agreement.

               (p) "Company Securities" shall mean (i) any Common Stock and (ii)
any other securities of the Company entitled to vote generally in the election
of directors of the Company.

               (q) "Conveyance Agreement" shall have the meaning assigned to it
in the recitals.

               (r) "DGCL" means the Delaware General Corporation Law, as amended
and in effect from time to time.

               (s) "Director" shall have the meaning assigned to it in Section
3.1(a).

               (t) "Employee Stock Plan" shall have the meaning assigned to it
in the Conveyance Agreement.

               (u) "FIG Advisors" shall mean FIG Advisors LLC, a Delaware
limited liability company, or any other Person designated as "FIG Advisors" by
Fortress Investment Group LLC in a written notice to the Stockholders.

               (v) "Fortress Stockholders" shall mean collectively (i) FBA, (ii)
FIT, (iii) FIT-ALT Investor LLC and (iv) each of their respective Permitted
Transferees who becomes a party to or bound by the provisions of this Agreement
in accordance with the terms hereof or Permitted Transferee thereof who is
entitled to enforce the provisions of this Agreement in accordance with the
terms hereof.

                                       3
<PAGE>
               (w) "HP Stockholders" shall mean (i) HP and (ii) each of its
Permitted Transferees who becomes a party to or bound by the provisions of this
Agreement in accordance with the terms hereof or Permitted Transferee thereof
who is entitled to enforce the provisions of this Agreement in accordance with
the terms hereof.

               (x) "Initial Public Offering" shall mean the initial public
offering of Common Stock pursuant to an effective registration statement under
the Securities Act on the terms set forth on Schedule A hereto.

               (y) "Liens" mean any and all liens, mortgages, pledges, claims,
rights, charges, security interests or other restrictions or encumbrances.

               (z) "Major Decision" means the following actions of the Company,
whether action with respect to such matters is taken directly on behalf of the
Company or indirectly on behalf of any Subsidiary:

                    (i) to add to or increase the capital of the Company or to
issue equity securities of the Company to any Person (other than pursuant to
executive compensation and employee benefit programs);

                    (ii) to do anything that would cause a stockholder of the
Company, or require any stockholder of the Company, to repurchase, prepay or
incur any Indebtedness or guarantee or otherwise become personally liable for
any Indebtedness incurred by the Company, without the prior consent of such
stockholder

                    (iii) to sell, exchange, finance, refinance, convey or
otherwise dispose of any asset, business, investment, property or project
directly or indirectly owned by the Company or any Subsidiary (including,
without limitation, Brookdale), including, without limitation, permitting any
Subsidiary (including, without limitation, Brookdale) of the Company to cancel,
terminate or otherwise materially modify any existing management agreement;

                    (iv) to merge or to consolidate the Company or Brookdale
with, or sell substantially all of the Company's or Brookdale's assets to, any
other Person, other than a merger of the Company, or a Subsidiary of the
Company, with or into Brookdale;

                    (v) to amend this Agreement, as set forth in Section 8.8
hereof, or to amend the Company's certificate of incorporation or bylaws;

                    (vi) acquire any interest in real or personal property;

                    (vii) confess a judgment against the Company or any
Subsidiary (including, without limitation, Brookdale) in an amount in excess of
$200,000;

                    (viii) to commence a Voluntary Bankruptcy or to decide not
to contest an Involuntary Bankruptcy;

                                       4
<PAGE>
                    (ix) the sale, dissemination, licensing, or the granting of
any right to use, to third parties, of any trade secrets, customer lists or
other intellectual property of the Company or Brookdale and the decision not to
seek enforcement of a violation of the intellectual property rights of the
Company or Brookdale (e.g., a trademark infringement);

                    (x) approval of executive compensation and employee benefit
programs;

                    (xi) to enter into, amend, extend or waive material
contracts (other than those agreements contemplated by the Conveyance
Agreement);

                    (xii) capital expenditures made by the Company in excess of
$1,000,000;

                    (xiii) to undertake an initial public offering of Common
Stock or other Company Securities or any equity interests in any Subsidiary
(including, without limitation, Brookdale) or securities of any Person into
which the Company is proposed to be merged or consolidated in contemplation of
such an initial public offering, other than the Initial Public Offering;

                    (xiv) to approve each Annual Business Plan and any changes
to any Annual Business Plan;

                    (xv) to authorize and approve the dissolution of the
Company;

                    (xvi) appointment or removal of officers of the Company; and

                    (xvii) all transactions or agreements between the Company
and its Subsidiaries and any stockholders of the Company or their respective
Affiliates;

provided, however, that the following shall not be deemed a "Major Decision" and
shall not require the consent of the Director: (i) the Initial Public Offering
(however any sale by (A) FBA, (B) FIT, (C) FIT-ALT, (D) the respective
Affiliates of FBA and FIT, or (E) any member of the management of the Company in
the Initial Public Offering shall be deemed a "Major Decision"), (ii) any
issuance of securities pursuant to the Alterra Stock Plan or the Employee Stock
Plan and the execution of any employment agreements related thereto, (iii) the
acquisition by the Company, a Subsidiary thereof, or a joint venture in which
the Company or a Subsidiary thereof may participate, of all or part of a
portfolio of properties known as the AEW Senior Housing Portfolio, whether by
acquisition of leasehold interests therein or by purchase of the property
directly or of all the equity interests of such properties' direct owners, or
some combination thereof, and whether for cash or for Common Stock, (iv) the
acquisition by the Company or a Subsidiary thereof of the property known as
Orlando Madison House and Ivy Court located in Orlando, Florida, whether by
purchase of the property directly or of all the equity interests of such
properties' direct owners and whether for cash or for Common

                                       5
<PAGE>
Stock, (v) the acquisition of the six properties currently subject to leases
between Omega Healthcare Investors, Inc. and Alterra Healthcare Corporation or a
Subsidiary thereof, whether by purchase of the property directly or of all the
equity interests of such properties' direct owners and whether for cash or for
Common Stock, (vi) capital expenditures, in an amount not to exceed $10,000,000,
made by the Company or a Subsidiary thereof with respect to the properties
acquired by Fortress CCRC Acquisition LLC, (vii) capital expenditures, in an
amount not to exceed $3,500,000, made by the Company or a Subsidiary thereof
with respect to the property known as Canterbury Gardens; (viii) the execution
of a credit agreement, line of credit or similar agreement on the terms set
forth in Schedule B (the "Company Credit Agreement") pursuant to which the
Company may borrow money thereunder (including any related pledge agreements or
security agreements securing such borrowings with a pledge of Common Stock by HP
and affiliates of Fortress Investment Group LLC; provided, however, that it
shall be deemed a "Major Decision" if either the percentage of Common Stock
owned by HP required to be so pledged exceeds the percentage of Common Stock
owned by the affiliates of Fortress Investment Group LLC required to be pledged
or if the terms of the pledge of Common Stock by HP are different, in any
material respect, than the terms of the pledge of stock by the affiliates of
Fortress Investment Group LLC); (ix) the execution of a Purchase and Sale
Agreement by and between American Senior Living Limited Partnership and Alterra
Healthcare Corporation relating to the purchase of 22 properties; (x) the
implementation of an omnibus equity incentive plan by the Company providing for
the issuance of stock options, stock appreciation rights, restricted shares,
deferred shares, performance shares, unrestricted shares and other stock-based
awards and the issuance of awards for Common Stock thereunder having a fair
market value of up to $11,000,000.

               (aa) "Notice of Exercise" shall have the meaning assigned to it
in Section 4.7(b).

               (bb) "Notified Party" shall have the meaning assigned to it in
Section 4.2.

               (cc) "Notifying Party" shall have the meaning assigned to it in
Section 4.2.

               (dd) "Offer Price" shall have the meaning assigned to it in
Section 4.7(a).

               (ee) "Offer to Purchase" shall have the meaning assigned to it in
Section 8.13.

               (ff) "Offered Securities" shall have the meaning assigned to it
in Section 4.7.

               (gg) "Organizational Documents" means the certificate of
incorporation (and any amendments or certificates of designation related
thereto) and bylaws of the Company, each as amended and in effect from time to
time.

                                       6
<PAGE>
               (hh) "Other Stockholders" shall have the meaning assigned to it
in Section 5.1(a).

               (ii) "Participating Stockholders" shall have the meaning assigned
to it in Section 5.1(b).

               (jj) "Permitted Transferee" shall mean, with respect to each
Stockholder, (i) any other Stockholder, (ii) such Stockholder's Affiliates and
(iii) in the case of any Stockholder, (A) any general or limited partner or
member of such Stockholder, (B) any corporation, partnership, limited liability
company or other entity that is an Affiliate of such Stockholder or any general
or limited partner of such Stockholder (collectively, "Stockholder Affiliates"),
(C) any investment funds managed directly or indirectly by such Stockholder or
any Stockholder Affiliates (a "Stockholder Fund"), (D) any general or limited
partner of any Stockholder Fund, (E) any managing director, general partner,
director, limited partner, officer or employee of any Stockholder Affiliate, or
any spouse, lineal descendant, sibling, parent, heir, executor, administrator,
testamentary trustee, legatee or beneficiary of any of the foregoing persons
described in this clause (E) (collectively, "Stockholder Associates") or (F) any
trust, the beneficiaries of which, or any corporation, limited liability company
or partnership, the stockholders, members or general or limited partners of
which consist solely of any one or more of such Stockholder, any general or
limited partner of such Stockholder, any Stockholder Affiliates, any Stockholder
Fund, any Stockholder Associates, their spouses or their lineal descendants.

               (kk) "Person" shall mean any individual, firm, corporation,
partnership, limited liability company or other entity, and shall include any
successor (by merger or otherwise) of such entity.

               (ll) "Pro Rata Share" shall mean the ratio of (x) the number of
shares of Common Stock then held by a Person to (y) the total number of shares
of Common Stock then outstanding.

               (mm) "Proposed Transfer" shall have the meaning assigned to it in
Section 4.7(a).

               (nn) "Proposing Stockholder" shall have the meaning assigned to
it in Section 4.7(a).

               (oo) "Purchase Election" shall have the meaning assigned to it in
Section 4.4(a).

               (pp) "Remaining Stockholders" shall have the meaning assigned to
it in Section 4.7(a).

               (qq) "Response Period" shall have the meaning assigned to it in
Section 4.4(a).

                                       7
<PAGE>
               (rr) "Sale Election" shall have the meaning assigned to it in
Section 4.4(a).

               (ss) "Securities Act" shall mean the Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder.

               (tt) "Stockholders" shall mean collectively (i) the Fortress
Stockholders and (ii) the HP Stockholders.

               (uu) "Subsidiaries" of a Person means all other Persons in which
the first Person owns, directly or indirectly, not less than a majority of the
equity interests.

               (vv) "Tag-Along Notice " shall have the meaning assigned to it in
Section 5.1(b).

               (ww) "Tag-Along Notice Period" shall have the meaning assigned to
it in Section 5.1(b).

               (xx) "Third Party" shall mean any Person other than a Permitted
Transferee.

               (yy) "Third Party Offer" shall have the meaning assigned to it in
Section 5.1(a).

               (zz) "Third Party Notice" shall have the meaning assigned to it
in Section 5.1(a).

               (aaa) "Transfer" shall mean, with respect to any Company
Securities, (i) when used as a verb, to sell, assign, dispose of, exchange,
pledge, encumber, hypothecate or otherwise transfer such Company Securities or
any participation or interest therein, whether directly or indirectly, or agree
or commit to do any of the foregoing (other than in connection with the Company
Credit Agreement) and (ii) when used as a noun, a direct or indirect sale,
assignment, disposition, exchange, pledge, encumbrance, hypothecation, or other
transfer of such Company Securities or any participation or interest therein or
any agreement or commitment to do any of the foregoing (other than in connection
with the Company Credit Agreement). For the avoidance of doubt, any transfer by
Fortress Registered Investment Trust or its Affiliates of its or their ownership
interests in FBA shall be deemed a Transfer of Company Securities for purposes
of this Agreement.

               (bbb) "Transferring Stockholder" shall have the meaning assigned
to it in Section 5.1(a).

               (ccc) "Voting Power of the Company" shall mean the total number
of votes that may be cast in the election of directors of the Company if all
Company Securities were present and voted at a meeting held for such purpose.

                                        8
<PAGE>
                                   ARTICLE II

                              TRANSFER RESTRICTIONS

          Section 2.1 Restrictions on Transfer.

               (a) No Stockholder, nor any assignee or successor in interest of
any Stockholder, including a Permitted Transferee, shall (voluntarily or
involuntarily) directly or indirectly, Transfer its Company Securities or any
economic benefit therein (including a Transfer pursuant to a foreclosure sale of
any of the assets of a Stockholder), or in any part thereof without the prior
written consent of the Board (which may be withheld for any or no reason) except
to a Permitted Transferee and except as provided in Articles IV and V hereof.
Subject to the other restrictions on Transfers contained herein, any Stockholder
intending to Transfer its Company Securities under this Agreement may Transfer
any of its Company Securities equal to the number of shares thereof that
represent 20% of such Stockholder's Company Securities (or if such Stockholder
shall acquire additional Company Securities, 20% of such higher number of
Company Securities). Any Stockholder intending to Transfer in excess of 20% of
its Company Securities shall Transfer 100% of its remaining Company Securities.
Notwithstanding anything to the contrary in this Agreement, the rights of a
Stockholder pursuant to Section 3.1 hereunder, including, if applicable, the
right to approve Major Decisions, to designate a director to the Board, and to
appoint individuals to serve on committees of the Board, shall not be
transferred to any transferee other than a Permitted Transferee; provided,
however, that if the Initial Public Offering has not occurred by December 31,
2005, a Stockholder may transfer such rights to a single transferee acquiring
50% or more of such Stockholder's Company Securities.

               (b) Any transferee of Company Securities shall be deemed a
Stockholder upon: (i) the transferee agreeing to be bound by all the terms and
conditions of this Agreement as then in effect; (ii) compliance with applicable
federal and state securities laws; and (iii) receipt of any necessary regulatory
approvals. Unless and until a transferee is deemed to be a Stockholder, the
transferee shall have no right to exercise any of the powers, rights and
privileges hereunder. A Stockholder who has Transferred its Company Securities
shall cease to be a Stockholder upon Transfer of all of such Stockholder's
Company Securities and thereafter shall have no powers, rights and privileges as
a Stockholder hereunder except as otherwise expressly provided herein.

          Section 2.2 Binding Effect on Transferees.

               (a) Any purported Transfer of Company Securities or any economic
interest therein not in compliance with Section 2.1 and Articles IV or V, where
applicable, hereof shall be null and void ab initio, regardless of any notice
provided to the Company, and shall not create any obligation or liability of the
Company to the purported transferee, and any Person purportedly acquiring any
Company Securities or any

                                        9
<PAGE>
economic interest therein purportedly transferred not in compliance with Section
2.1 and Articles IV or V, where applicable, hereof shall not be a Stockholder.

               (b) In the case of an attempted Transfer of any Company
Securities or any economic benefit therein that is not in compliance with
Section 2.1 and Articles IV or V, where applicable,, the parties engaging or
attempting to engage in such Transfer shall indemnify and hold harmless the
Company, the Board and the other Stockholders from all cost, liability and
damage that any of such indemnified persons may incur (including, without
limitation, incremental tax liability and attorneys' fees and expenses) as a
result of such Transfer or attempted Transfer and the enforcement of this
indemnity.

          Section 2.3 Additional Purchases. Any Company Securities owned by a
Stockholder on or after the date of this Agreement shall be subject to the terms
and conditions of this Agreement.

          Section 2.4 Legend. Each certificate representing Company Securities
shall be stamped or otherwise imprinted with a legend in substantially the
following form:

          "The shares represented by this certificate are subject to the
          provisions contained in the Governance Agreement dated as of September
          30, 2005 among the stockholders of the Corporation named therein."

                                   ARTICLE III

                              CORPORATE GOVERNANCE

          Section 3.1 Board of Directors.

               (a) For so long as this Agreement is in effect, each of the
Stockholders shall vote or cause to be voted all of the Company Securities held
of record or Beneficially Owned by such Stockholder and take all other
reasonably necessary action so as to elect to the board of directors of the
Company (the "Board"), and to continue in office one director designated by HP
(the "Director"). In addition, so long as a HP has the right to designate the
Director, the Company shall cause any executive committee, compensation
committee, audit committee, nominating committee or other similar committee of
the Board (including any committee performing the functions usually reserved for
the committees described above) to include such Director. The Stockholders shall
cause the Company to take all necessary or desirable action within its control
to give effect to the provisions of this Article III.

               (b) The Director shall serve until voluntary resignation or
retirement, or removal with or without cause by HP. Approval of Major Decisions
shall require the approval of the Director. Any other matters required to be
submitted by law or otherwise for vote or action by the Board shall require the
approval of a majority of the Board.

                                       10
<PAGE>
               (c) If HP notifies the other Stockholders of its desire to
remove, with or without cause, the Director previously designated by it, each
Stockholder shall vote or cause to be voted all of the shares of Company
Securities held or record or beneficially owned by such Stockholder and take all
other necessary actions to cause the removal of any director designated by HP,
as the case may be, pursuant to this Section 3.1(c).

               (d) In the event that any designee of HP shall for any reason
cease to serve as a member of the Board during his term of office, the resulting
vacancy on the Board will be filled by an individual designated by HP and each
of the Stockholders shall vote or cause to be voted all of the Company
Securities held of record or beneficially by such Stockholder and take all other
reasonably necessary action so as to effect the purpose of this Section 3.1(d).
Any vacancies other than as contemplated by this Section 3.1(d) shall be filled
by a majority vote of the Board.

               (e) If at any time HP shall no longer be entitled pursuant to
this Section 3.1 to designate a Director, within 2 days thereafter, HP shall
cause the Director designated by it to resign from the Board. Any vacancies
created by a resignation required by this Section 3.1(e) shall be filled by a
majority vote of the Board.

                                   ARTICLE IV

                                 BUY/SELL RIGHT

          Section 4.1 Buy/Sell Rights. Upon the occurrence of a Buy/Sell Event,
FIT, on the one hand, and HP, on the other hand, shall have the right (each, a
"Buy/Sell Right") to buy all of the Company Securities held directly or
indirectly by the Fortress Stockholders or the HP Stockholders, as applicable,
or to cause to be sold all of the Company Securities held directly or indirectly
by the Fortress Stockholders or the HP Stockholders, as applicable, to such
other party. The Buy/Sell Right shall be exercised in accordance with the
provisions of this Article IV.

          Section 4.2 Delivery of Notice. Upon the occurrence of a Buy/Sell
Event in connection with an irreconcilable dispute concerning a Major Decision,
FIT or HP shall notify the other (the Initial Stockholder first giving notice
pursuant to this Section 4.2 is referred to hereinafter as a "Notifying Party",
and the other Stockholder so receiving notice from the Notifying Party is
referred to hereinafter as the "Notified Party") in writing, with a copy to the
Board, that it intends to exercise the Buy/Sell Right (each, a "Buy/Sell
Notice"). Once the Notifying Party delivers the Buy/Sell Notice, the Notified
Party may not exercise its Buy/Sell Right until the procedure established in
this Article IV is concluded with respect to such Buy/Sell Notice or until the
Notifying Party breaches any provision established in this Article IV.

          Section 4.3 Contents of Notice. The Buy/Sell Notice shall contain an
unconditional promise by the Notifying Party, at the election of the Notified
Party, to

                                       11
<PAGE>
either (i) sell all of its Company Securities and the Company Securities of the
other Fortress Stockholders or the other HP Stockholders, as applicable, to the
Notified Party, or (ii) acquire all of the Company Securities of the Notified
Party and the other Fortress Stockholders or the other HP Stockholders, as
applicable, in either case at a cash price for the Company Securities stated in
the Buy/Sell Notice (collectively, the "Buy/Sell Price")) and within the time
periods specified in this Article IV. The Buy/Sell Price shall be a cash dollar
price per Company Security based on the value of all of the Company's equity
securities outstanding on the date of the Buy/Sell Notice, without any
reductions made thereto.

          Section 4.4 Election

               (a) Within fifteen (15) days after receipt of the Buy/Sell Notice
by the Notified Party (each, a "Response Period"), the Notified Party shall
notify the Board of the Notified Party's election to either: (i) accept the
Notifying Party's offer to purchase the Notified Party's and the other Fortress
Stockholders' or the other HP Stockholders', as applicable, Company Securities
at the Buy/Sell Price (each, a "Sale Election"), or (ii) accept the Notifying
Party's offer to sell all of its and the other Fortress Stockholders' and the
other HP Stockholders' Company Securities at the Buy/Sell Price (each, a
"Purchase Election").

               (b) Within two (2) Business Days from the earlier of the
expiration of the Response Period or receipt by the Board of the election of the
Notified Party contemplated to be delivered by Section 4.3, the Board shall send
a written notice to all Stockholders, informing them with respect to the
Notified Party whether it made a Sale Election or a Purchase Election.

               (c) If the Notified Party fails to notify the Board within the
Response Period it shall be deemed to have made a Sale Election.

               (d) If the Notified Party makes a Purchase Election, then the
Notified Party shall purchase all of the Company Securities of the Notifying
Party and the other Fortress Stockholders or the other HP Stockholders, as
applicable, at the Buy/Sell Price.

               (e) If the Notified Party makes a Sale Election, then the
Notifying Party shall purchase for cash at the Buy/Sell Price the Notified
Party's and the other Fortress Stockholders' or the other HP Stockholders', as
applicable, Company Securities.

          Section 4.5 Closing. The closing on any Transfer of Company Securities
pursuant to this Article IV shall occur on or prior to the date which is forty
five (45) days after the date on which the notice described in Section 4.4(b) is
mailed and each of the parties agrees to execute all documents and do all things
necessary to close the Transfer.

                                       12
<PAGE>
          Section 4.6 Failure to Purchase Securities. (i) If the Notified Party
fails to purchase the Company Securities pursuant to the exercise of a Purchase
Election at the closing in accordance with Section 4.5, then the Notifying Party
shall have the right, for a period of thirty (30) days from the date originally
scheduled for the closing pursuant to Section 4.5 to purchase the Notified
Party's and the other Fortress Stockholders' or other HP Stockholders', as
applicable, Company Securities at a cash price equal to 80% of the Buy/Sell
Price; and (ii) if the Notifying Party fails to purchase the Company Securities
pursuant to the exercise of a Sale Election at the closing in accordance with
Section 4.5, then the Notified Party shall have the right, for a period of
thirty (30) days from the date originally scheduled for the closing pursuant to
Section 4.5, to purchase the Notifying Party's and the other Fortress
Stockholders' or other HP Stockholders', as applicable, Company Securities at a
cash price equal to 80% of the Buy/Sell Price.

          Section 4.7 No Restrictions or Encumbrances. Any Company Securities
transferred pursuant to this Article IV shall be transferred free and clear of
any and all liens, mortgages, pledges, interests or other restrictions or
encumbrances.

          Section 4.8 Company Securities of Emeritus and NW Select. In the event
that HP elects or is required to purchase Company Securities pursuant to this
Article IV, (i) HP shall simultaneously purchase all Company Securities held by
Emeritus Corporation and NW Select LLC or their respective Permitted Transferees
at a cash dollar price per Company Security equal to the Buy/Sell Price and in
accordance with the other terms of this Article IV and (ii) the Fortress
Stockholders shall cause Emeritus Corporation, NW Select LLC and their
respective Permitted Transferees to sell such Company Securities in accordance
with the terms of this Article IV. As used in this Section 4.8 only, the term
"Permitted Transferees" shall have the meaning assigned to it in the
Stockholders and Voting Agreement, dated the date hereof, between FIT-ALT
Investor LLC, Emeritus Corporation and NW Select LLC.

          Section 4.9 Termination of Buy/Sell Right. The provisions of this
Article IV shall terminate and be of no further force and effect upon the
declaration by the Securities and Exchange Commission of the effectiveness of
the registration statement filed by the Company with respect to Initial Public
Offering.

                                    ARTICLE V

               TAG-ALONG; DRAG-ALONG RIGHTS; RIGHT OF FIRST OFFER

          Section 5.1 Tag-Along Rights

               (a) Subject to compliance with Section 5.3, and except for
Transfers to (i) Permitted Transferees and (ii) Transfers permitted by the
express terms of Article IV and Section 5.2, if a Stockholder (each a
"Transferring Stockholder") intends to Transfer any or all of the Company
Securities then owned by or in the name of such Transferring Stockholder to a
Third Party (each, a "Third Party Offer"), the Transferring Stockholder shall
promptly, acting in good faith (A) cause the Third Party Offer to be

                                       13
<PAGE>
reduced to writing, which shall identify the Third Party, the Company Securities
proposed to be transferred to the Third Party by the Transferring Stockholder,
the price to be paid in cash by the Third Party and all other material terms and
conditions of the Third Party Offer and (B) provide written notice (the "Third
Party Notice") of such Third Party Offer to each of the Stockholders (the
Stockholders receiving a Third Party Notice pursuant to this sentence being
collectively referred to herein as the "Other Stockholders"), which Third Party
Notice shall (x) contain an offer by such Third Party to purchase or otherwise
acquire from each Other Stockholder such Other Stockholder's Company Securities
(to the extent such Third Party Offer shall be allocable to such Other
Stockholder pursuant to Section 5.1(c) hereof) on the same terms and conditions
as the Third Party Offer (except that the only representation and warranty that
such Other Stockholder shall be required to make in connection with any such
Transfer is a warranty with respect to his or its own ownership of the Company
Securities to be sold by him or it and his or its ability to convey title
thereto free and clear of any and all Liens), (y) be accompanied by a true and
correct copy of the Third Party Offer and (z) specify the total number of
Company Securities then owned by the Transferring Stockholder.

               (b) Each Other Stockholder desiring to accept the offer (each, a
"Participating Stockholder") set forth in the Third Party Notice shall, within
ten (10) Business Days after the date the Third Party Notice is received by such
Other Stockholder (as such period may be extended pursuant to Section 5.1(d)
hereof, (each, a "Tag-Along Notice Period"), deliver a written notice to the
Transferring Stockholder (each, a "Tag-Along Notice"), which notice shall (i)
specify the number of Company Securities which such Participating Stockholder
wishes to Transfer pursuant to the Third Party Offer and the Company Securities
then owned by such Participating Stockholder and (ii) constitute a firm
acceptance by such Other Stockholder of the Third Party Offer, except as
otherwise provided in Sections 5.1(c) and (d) hereof.

               (c) If one or more Other Stockholders give the Transferring
Stockholder a timely Tag-Along Notice, then the Transferring Stockholder shall
use all reasonable efforts to cause the Third Party to agree to acquire all
Company Securities identified in all Tag-Along Notices that are timely given to
the Transferring Stockholder, upon the same terms and conditions as are
applicable to the Transferring Stockholder's Company Securities. If such Third
Party is unwilling or unable to acquire all of such additional Company
Securities upon such terms, then the Transferring Stockholder may elect to
either cancel such proposed Transfer or allocate the maximum Company Securities
that such Third Party is willing to purchase among the Transferring Stockholder
and the Participating Stockholders, with (i) each Participating Stockholder
permitted to sell Company Securities corresponding to the product of (x) their
Pro Rata Share and (y) the maximum Company Securities that such Third Party is
willing to purchase and (ii) the Transferring Stockholder permitted to sell
Company Securities equal to the remaining Company Securities that such Third
Party is willing to purchase.

               (d) In the event that the terms and conditions of any Third Party
Offer shall be modified in any way prior to the consummation of the respective
Transfers of Company Securities contemplated by such Third Party Offer, the
Transferring Stockholder shall send a copy of the amended Third Party Offer to
each of the

                                       14
<PAGE>
Participating or Other Stockholders. Any Other Stockholder desiring to Transfer
Company Securities pursuant to the amended Third Party Offer, or any
Participating Stockholder desiring to amend or withdraw its Tag-Along Notice may
do so by delivering notice within three (3) Business Days after receipt of such
amended Third Party Offer to the Transferring Stockholder. If such notice is not
timely delivered, such Other Stockholder shall be deemed to have elected not to
participate in the Third Party Offer, or such Participating Stockholder, as the
case may be, shall be deemed to have elected to participate in such Third Party
Offer under the same terms and conditions that such Participating Stockholder
shall have originally elected to Transfer its Company Securities.

               (e) Within three (3) Business Days after the termination of the
Tag-Along Notice Period (including any extension thereof) with respect to any
Third Party Offer, the Transferring Stockholder, after review of the Tag-Along
Notices received, and notices of withdrawal, if any, shall give written notice
to each Participating Stockholder of (A) such Participating Stockholder's
Company Securities to be purchased pursuant to the Third Party Offer, showing
the basis for the calculation thereof, and (B) the time and place of the
closing, which shall occur not fewer than two (2) Business Days and not more
than fifteen (15) Business Days from the date such notice is given. At the
closing, each Participating Stockholder shall, and hereby covenants to, Transfer
such Participating Stockholder's Company Securities to be sold to such Third
Party free and clear of any and all Liens against payment of the purchase price
for such Company Securities. If any Participating Stockholder fails to deliver
any Company Securities to the Third Party, each of the other Participating
Stockholders (and the Transferring Stockholder) shall be entitled to increase
the Company Securities that it may Transfer in connection with the Third Party
Offer by allocating such Participating Stockholder's Company Securities in the
manner set forth in Section 5.1(c). If such Third Party does not purchase such
Company Securities from all Participating Stockholders on the same terms and
conditions applicable to the Transferring Stockholder, then the entire proposed
Transfer by the Transferring Stockholder to such Third Party shall be invalid.

               (f) If at the termination of the Tag-Along Notice Period (and any
extension thereof) any Other Stockholder shall not have accepted the offer
contained in the Third Party Notice, such Other Stockholder shall be deemed to
have waived any and all of his or its rights under this Section 5.1 to Transfer
his or its Company Securities to such Third Party on the terms specified in the
Third Party Offer pursuant to that Third Party Notice but not pursuant to any
subsequent Third Party Notice.

          Section 5.2 Drag-Along Rights.

               (a) If the Board approves a sale of the Company or substantially
all of its assets to a Third Party (an "Approved Sale"), whether by way of
merger, consolidation, sale of interests or assets, or otherwise (which
decision, for avoidance of doubt, shall constitute a "Major Decision"), all
Stockholders shall consent to and raise no objections against the Approved Sale,
and if the Approved Sale is structured as (i) a merger or consolidation of the
Company, or a sale of all or substantially all of the Company's assets, each
Stockholder shall waive any dissenters rights, appraisal rights or

                                       15
<PAGE>
similar rights in connection with such merger, consolidation or asset sale, or
(ii) a sale of Company Securities, the Stockholders shall agree to sell their
Company Securities on the terms and conditions approved by the Board in
accordance with the terms hereof. The Stockholders shall take all necessary and
desirable actions approved by the Board in connection with the consummation of
the Approved Sale, including the execution of such agreements and such
instruments and other actions reasonably necessary (i) to provide the
representations, warranties, indemnities, covenants, conditions, escrow
agreements and other provisions and agreements relating to such Approved Sale,
to the extent reasonably customary in similar transactions, and (ii) to
effectuate the allocation and distribution of the aggregate consideration upon
the Approved Sale as set forth below.

               (b) The obligations of the Stockholders pursuant to this Section
5.2 are subject to the following conditions:

                    (i) upon consummation of the Approved Sale, each Stockholder
shall receive from the Approved Sale the same amount of consideration with
respect to each of its Company Securities that all other holders of such Company
Security shall receive with respect to such Company Security;

                    (ii) if any holder of a Company Security is given an option
as to the form and amount of consideration to be received, all Stockholders will
be given the same option;

                    (iii) no Stockholder shall be obligated to make any
out-of-pocket expenditure prior to the consummation of the Approved Sale
(excluding modest expenditures for postage, copies, etc.) and no Stockholder
shall be obligated to pay more than his or its pro rata share (based upon the
amount of consideration received) of reasonable expenses incurred in connection
with a consummated Approved Sale to the extent such costs are incurred for the
benefit of all Stockholders and are not otherwise paid by the Company or the
acquiring party, provided that a Stockholder's liability for such expenses shall
be capped at the total purchase price received by such Stockholder for his or
its Company Securities; and

                    (iv) in the event that the Stockholders are required to
provide any representations or indemnities in connection with the Approved Sale
(other than representations and indemnities concerning each Stockholder's valid
ownership of his or its Company Securities, free and clear of any and all Liens,
each Stockholder's authority, power and right to enter into and consummate such
purchase or merger agreement without violating any other agreement and other
representations and indemnities which are individual to each Stockholder), then
no Stockholder shall be liable for more than his or its pro rata share (based
upon the Company Securities held and not the amount of consideration received)
of any liability for misrepresentation or indemnity and such liability shall not
exceed the total purchase price received by such Stockholder for his or its
Company Securities.

          Section 5.3 Right of First Offer.

                                       16
<PAGE>
               (a) If a Stockholder proposes to Transfer (each, a "Proposed
Transfer") any of its Company Securities (the "Offered Securities") to any Third
Party, such Stockholder (the "Proposing Stockholder") shall submit a written
notice (a "Notice of Proposed Transfer") to the other Stockholders (the
"Remaining Stockholders") describing the material terms and conditions of the
Proposed Transfer in reasonable detail, including, without limitation, the
proposed purchase price (which shall be for cash only) (the "Offer Price").

               (b) Upon receipt of the Notice of Proposed Transfer, each of the
Remaining Stockholders shall have the primary right, but not the obligation, for
a period (the "Primary Option Period") of ten (10) Business Days following
receipt of the Notice of Proposed Transfer, to elect to purchase at the Offer
Price all of the Offered Securities on the same terms and conditions as are set
forth in the Notice of Proposed Transfer. If, however, there is more than one
Remaining Stockholder that desires to exercise its primary rights to purchase
all of the Offered Securities and they do not agree on the number of such
Offered Securities to be purchased by each within five (5) Business Days prior
to the expiration of the Primary Option Period, then each such Remaining
Stockholder shall be entitled to purchase such proportion of those Offered
Securities equal to the proportion that the Company Securities owned by such
Remaining Stockholder bears to the total amount of Company Securities held by
all of the Stockholders desiring to purchase such Offered Securities. Each
Remaining Stockholder shall also have a secondary right, on the same terms as
are set forth in the Notice of Proposed Transfer, for a period of ten (10)
Business Days from the expiration of the Primary Option Period, to purchase any
or all of the remaining portion of the Offered Securities not purchased by any
other Remaining Stockholder in the exercise of his or its primary right. If,
however, there is more than one Remaining Stockholder desiring to exercise
secondary rights to purchase any such remaining Offered Securities and they do
not agree on the number of such Offered Securities to be purchased by each
within five (5) Business Days from the expiration of the Primary Option Period,
then each such Remaining Stockholder shall be entitled to purchase such
proportion of those Offered Securities which remain undisposed of as the Company
Securities owned by such Remaining Stockholder bears to the total Company
Securities held by all of the Stockholders desiring to purchase such Offered
Securities. The primary and secondary rights of the Remaining Stockholders set
forth herein are exercisable in each case by delivery of one notice to the
Company and the Proposing Stockholder (a "Notice of Exercise") within the time
periods specified herein, which Notice of Exercise shall specify a time and
place of closing, which closing shall occur not less than thirty (30) days and
not more than sixty (60) days from the date of delivery of the Notice of
Exercise.

               (c) In the event that the Remaining Stockholders exercise their
rights to purchase all but not less than all of the Offered Securities in
accordance with Section 5.3(b), then the Proposing Stockholder must sell the
Offered Securities elected to be purchased by the Remaining Stockholders to such
Remaining Stockholders at the closing specified in Section 5.3(b) hereof. The
Proposing Stockholder shall notify each such Remaining Stockholder of the
portion of Offered Securities to be sold to such Remaining Stockholders. At such
closing, the Proposing Stockholder shall, and hereby

                                       17
<PAGE>
covenants to, Transfer the Offered Securities to such Remaining Stockholders
free and clear of any and all Liens against payment of the Offer Price in
accordance with the notices specified in Sections 5.3 (a) and (b) hereof.

               (d) If (i) all notices required to be given pursuant to Sections
5.3 (a) and (b) hereof have been duly given and (ii) all of the Offered
Securities are not purchased by the Remaining Stockholders in accordance with
Sections 5.3(b) and (c) hereof, then the Proposing Stockholder shall have the
right, for a period of ninety (90) days from the earlier of (i) the expiration
of the last applicable option period pursuant to Section 5.3 (b) hereof with
respect to such Notice of Proposed Transfer and (ii) the date on which such
Proposing Stockholder receives notice from all of the Remaining Stockholders
that they will not exercise the options granted pursuant to Sections 5.3 (b) and
(c) hereof to sell, subject to Section 5.1 hereof, to any Third Party the
Offered Securities at a price not less than the Offer Price and on terms and
conditions as favorable as offered to the Remaining Stockholders.

               (e) In the event that the Remaining Stockholders do not exercise
their options to purchase all of the Offered Securities, and the Proposing
Stockholder shall not have sold the Offered Securities as to which such options
shall not have been exercised, to a Third Party for any reason before the
expiration, as applicable, of the ninety (90)-day period described in Section
5.3(d) hereof, or such Proposing Stockholder withdraws the Notice of Proposed
Transfer, then such Proposing Stockholder shall not give another Notice of
Proposed Transfer pursuant to Section 5.3(a) hereof for a period of one hundred
twenty (120) days from the last day of such ninety (90)-day period.

               (f) If any Stockholder does not purchase any of the Offered
Securities under this Section 5.3 but wishes to sell Company Securities under
Section 5.1 hereof, such Stockholder must deliver a Tag-Along Notice pursuant to
Section 5.1(b) hereof simultaneously with declining such Stockholder's right to
purchase under this Section 5.3 hereof.

                                   ARTICLE VI

                       REPRESENTATIONS OF EACH STOCKHOLDER

Each Stockholder hereby represents and warrants to each other Stockholder as
follows:

          Section 6.1 Due Organization, Authorization. Such Stockholder is
either (a) duly organized, validly existing and in good standing under the laws
of its jurisdiction of organization or (b) a natural person that is competent
and has legal capacity to execute, deliver and perform its obligations under
this Agreement. The execution, delivery and performance by such Stockholder of
this Agreement, if not a natural person, and the consummation by such
Stockholder of the transactions contemplated hereby, have been duly authorized
by all necessary corporate and other action on its part.

          Section 6.2 Enforceability, Etc. This Agreement has been duly executed
and delivered by such Stockholder. This Agreement constitutes a legal, valid and
binding obligation of such Stockholder, enforceable against such Stockholder in
accordance with

                                       18
<PAGE>
its terms, subject to any limitations imposed by bankruptcy, insolvency, or
other laws of general application relating to enforcement of creditors' rights
or general equity principles.

          Section 6.3 No Conflicts. The execution, delivery and performance of
this Agreement by such Stockholder and the consummation by such Stockholder of
the transactions contemplated hereby will not (a) result in a violation of, be
in conflict with or constitute a default (with or without notice or lapse of
time or both) under (i) any law applicable to such Stockholder or any of its
assets, (ii) any provision of its organizational documents, if such Stockholder
is not a natural person, (iii) any order or judgment of any court or other
agency of government applicable to such Stockholder or any of its assets or (iv)
any contractual restriction binding on or affecting such Stockholder or any of
its assets or (b) result in the creation or imposition of any Lien upon any of
such Stockholder's assets, including the shares of Common Stock.

          Section 6.4 Governmental Approvals. No consent, approval, order or
authorization of, or registration, declaration or filing with, any court,
administrative agency or commission or other governmental authority or
instrumentality, including under federal or state law or otherwise, is required
to be obtained or made by or with respect to such Stockholder in connection with
its execution and delivery of this Agreement or the consummation of the
transactions contemplated hereby by such Stockholder (other than those which are
not material).

          Section 6.5 Litigation. There is no lawsuit, claim, proceeding or
investigation pending or threatened by or against such Stockholder or any of its
properties, assets, operations, businesses or prospects, which relates to the
transactions contemplated by this Agreement.

                                   ARTICLE VII

                                 INDEMNIFICATION

          Section 7.1 Indemnity. Subject to the provisions of Section 7.4
hereof, the Company shall indemnify any Person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative,
except an action by or in the right of the Company, by reason of the fact that
such Person is or was a Stockholder, officer, director, controlling person,
employee, legal representative or agent of the Company, or is or was serving at
the request of the Company as manager, director, officer, partner, shareholder,
controlling person, employee, legal representative or agent of another limited
liability company, partnership, corporation, joint venture, trust or other
enterprise, against expenses, including attorneys' fees, judgment, fines and
amounts paid in settlement actually and reasonably incurred by such person in
connection with the action, suit or proceeding if such person acted in good
faith and in a manner which such person reasonably believed to be in or not
opposed to the best interests of the Company, and, with respect to a criminal
action or proceeding, had no reasonable cause to believe such person's conduct
was unlawful; provided, however, that this Section 7.1 shall not apply

                                       19
<PAGE>
to any action, suit or proceeding to which a Stockholder is a party and which
arises out of, or relates to, the Conveyance Agreement.

          Section 7.2 Indemnity for Actions by or in Right of the Company. In
accordance with the provisions of Section 7.4 hereof, the Company shall
indemnify any Person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action or suit by or in the right of the
Company to procure a judgment in its favor by reason of the fact that such
Person is or was a Stockholder, Director, officer, controlling person, employee,
legal representative or agent of the Company, or is or was serving at the
request of the Company as manager, member, director, officer, partner,
shareholder, controlling person, employee, legal representative or agent of
another limited liability company, corporation, partnership, joint venture,
trust or other enterprise, against expenses, including amounts paid in
settlement and attorneys' fees actually and reasonably incurred by such Person
in connection with the defense or settlement of the actions or suit if such
person acted in good faith and in a manner which such person reasonably believed
to be in or not opposed to the best interests of the Company; provided, however,
that this Section 7.2 shall not apply to any action, suit or proceeding to which
a Stockholder is a party and which arises out of, or relates to, the Conveyance
Agreement.

          Section 7.3 Indemnity if Successful. The Company shall indemnify a
Stockholder, officer, director, controlling person, employee, legal
representative or agent of the Company against expenses, including attorneys'
fees, actually and reasonably incurred by such party in connection with the
defense of any action, suit or proceeding referred to in Sections 7.1 and 7.2
hereof or in defense of any claim, issue or matter therein, to the extent that
such person or entity has been successful on the merits.

          Section 7.4 Expenses. Any indemnification under Sections 7.1 and 7.2
hereof, as well as the advance payment of expenses permitted under Section 7.5
hereof shall be made by the Company to the fullest extent permitted under the
DGCL.

          Section 7.5 Advance Payment of Expenses. The expenses of the directors
and Stockholders incurred in defending a civil or criminal action, suit or
proceeding may be paid by the Company as they are incurred and in advance of the
final disposition of the action, suit or proceeding, upon receipt of an
undertaking by or on behalf of the directors or Stockholders, as the case may
be, to repay the amount if it is ultimately determined by a court of competent
jurisdiction that such director or Stockholder is not entitled to be indemnified
by the Company. The provisions of this subsection do not affect any rights to
advancement of expenses to which personnel other than directors or Stockholders
may be entitled under any contract or otherwise by law.

          Section 7.6 Other Arrangements. The indemnification and advancement of
expenses authorized in or ordered by a court pursuant to this Article VII:

               (a) does not exclude any other rights to which a Person seeking
indemnification or advancement of expenses may be entitled under the
Organizational Documents or any agreement, vote of Stockholders entitled to vote
or otherwise, for

                                       20
<PAGE>
either an action in such Person's official capacity or an action in another
capacity while holding office, except that indemnification, unless ordered by a
court pursuant to Section 7.5 above, may not be made to or on behalf of any
director or Stockholder if a final adjudication established that the acts or
omissions involved intentional misconduct, fraud or a knowing violation of the
law and was material to the cause of action; and

               (b) continues for a Person who has ceased to be a director,
Stockholder, employee or agent and inures to the benefit of the heirs, executors
and administrators of such a Person.

          Section 7.7 Additional Expenses. Except as otherwise provided in this
Agreement, the Company will be responsible for all expenses related to its
operation including, without limitation:

               (a) all expenses incurred by the Stockholders or their Affiliates
in organizing the Company;

               (b) all expenses related to the business of the Company
including, without limitation, administrative expenses of the Company, including
the maintenance of books and records of the Company, the preparation and
dispatch to the Stockholders of checks, financial reports, tax returns and
notices required pursuant to this Agreement or in connection with the holding of
any meetings of the Stockholders;

               (c) all expenses incurred by the officers and directors on behalf
of the Company and the Stockholders;

               (d) all expenses incurred in connection with any indebtedness or
guarantees of the Company or any proposed or definitive credit facility or other
credit arrangement;

               (e) all expenses incurred in connection with any litigation or
arbitration involving the Company (including the cost of any investigation and
preparation) and the amount of any judgment or settlement paid in connection
therewith;

               (f) all expenses for indemnity or contribution payable by the
Company to any Person;

               (g) all expenses incurred in connection with the collection of
amounts due to the Company from any Person;

               (h) all expenses incurred in connection with the preparation of
amendments to this Agreement;

               (i) all expenses incurred in connection with the liquidation,
dissolution and winding up of the Company; and

               (j) all expenses otherwise allocated in good faith to the Company
by the Board.

                                       21
<PAGE>
                                  ARTICLE VIII

                                  MISCELLANEOUS

          Section 8.1 Headings. The headings in this Agreement are for
convenience of reference only and shall not control or effect the meaning or
construction of any provisions hereof.

          Section 8.2 Entire Agreement. This Agreement constitute the entire
agreement and understanding of the parties hereto in respect of the subject
matter contained herein, and there are no restrictions, promises,
representations, warranties, covenants, conditions or undertakings with respect
to the subject matter hereof, other than those expressly set forth or referred
to herein. This Agreement supersedes all prior agreements and understandings
between the parties hereto with respect to the subject matter hereof.

          Section 8.3 Further Actions; Cooperation. Each of the Stockholders
agrees to use its reasonable efforts to take, or cause to be taken, all actions
and to do, or cause to be done, and to assist and cooperate with the other
parties in doing, all things necessary, proper or advisable to give effect to
the transactions contemplated by this Agreement, including, without limitation,
each Stockholder executing and delivering, or causing to be executed and
delivered, customary agreements (including, without limitation, any agreement
restricting the sale or other transfer of such Stockholder's Company Securities;
provided such agreement places no greater restrictions on the sale or transfer
of such Stockholder's Company Securities than are applicable to the Company
Securities of the Fortress Stockholders) and take such other actions as an
underwriter reasonably requests in connection with the Initial Public Offering.

          Section 8.4 Notices. All notices, requests, consents and other
communications hereunder to any party shall be deemed to be sufficient if
contained in a written instrument delivered in person or sent by telecopy,
nationally recognized overnight courier or first class registered or certified
mail, return receipt requested, postage prepaid, addressed to such party at the
address set forth below or such other address as may hereafter be designated on
the signature pages of this Agreement or in writing by such party to the other
parties:

          (a)  If to the Company to:

                    Brookdale Senior Living Inc.
                    330 N. Wabash, Suite 1400
                    Chicago, IL 60611
                    Fax: (866) 326-9975
                    Attn: Deborah C. Paskin, Esq.

               with a copy (which shall not constitute notice) to:

                    Fortress Investment Group, LLC

                                       22
<PAGE>
                    1251 Avenue of the Americas, 16th Floor
                    New York, NY 10020
                    Fax: (212) 798-6122
                    Attn: Randal A. Nardone

                    and

                    Skadden, Arps, Slate, Meagher & Flom LLP
                    4 Times Square
                    New York, NY 10036-6522
                    Fax: (212) 735-2000
                    Attn: Joseph A. Coco, Esq.

          (b)  If to any of the Fortress Stockholders, to:

                    c/o Fortress Investment Group, LLC
                    1251 Avenue of the Americas, 16th Floor
                    New York, NY 10020
                    Fax: (212) 798-6122
                    Attn: Randal A. Nardone

               with a copy (which shall not constitute notice) to:

                    Skadden, Arps, Slate, Meagher & Flom LLP
                    4 Times Square
                    New York, NY 10036-6522
                    Fax: (212) 735-2000
                    Attn: Joseph A. Coco, Esq.

          (c)  If to any of the HP Stockholders:

                    c/o Capital Z Management
                    54 Thompson Street
                    New York, New York 10012
                    Fax: (212) 965-2411
                    Attn: Mani A. Sadeghi and Joseph R. Tomei

               with a copy (which shall not constitute notice) to:

                    Weil, Gotshal & Manges LLP
                    767 Fifth Avenue
                    New York, New York 10153
                    Fax: (212) 310-8007
                    Attn: Douglas P. Warner, Esq.

All such notices, requests, consents and other communications shall be deemed to
have been given or made if and when received (including by overnight courier) by
the parties

                                       23
<PAGE>
at the above addresses or sent by electronic transmission, with confirmation
received, to the telecopy numbers specified above (or at such other address or
telecopy number for a party as shall be specified by like notice). Any notice
delivered by any party hereto to any other party hereto shall also be delivered
to each other party hereto simultaneously with delivery to the first party
receiving such notice.

          Section 8.5 Applicable Law. The substantive laws of the State of
Delaware shall govern the interpretation, validity and performance of the terms
of this Agreement, without regard to conflicts of law doctrines. THE PARTIES
HERETO WAIVE THEIR RIGHT TO A JURY TRIAL WITH RESPECT TO DISPUTES HEREUNDER.

          Section 8.6 Severability. The invalidity, illegality or
unenforceability of one or more of the provisions of this Agreement in any
jurisdiction shall not affect the validity, legality or enforceability of the
remainder of this Agreement, including any such provisions, in any other
jurisdiction, it being intended that all rights and obligations of the parties
hereunder shall be enforceable to the fullest extent permitted by law.

          Section 8.7 Successors and Assigns. Except as otherwise provided
herein, all the terms and provisions of this Agreement shall be binding upon,
shall inure to the benefit of and shall be enforceable by the respective
successors and permitted assigns of the parties hereto. Prior to the Transfer by
a Stockholder of Company Securities to a Permitted Transferee, the transferring
Stockholder shall cause the transferee to execute an agreement on the same terms
and conditions set forth herein, providing that such transferee shall be bound
by and shall fully comply with the terms of this Agreement. No Stockholder may
assign any of its rights hereunder to any Person other than a Permitted
Transferee that has complied in all respects with the requirements of this
Agreement.

          Section 8.8 Amendments. This Agreement may not be amended, modified or
supplemented unless such amendment, modification or supplement is in writing and
signed by each of the Stockholders.

          Section 8.9 Waiver. The failure of a party hereto at any time or times
to require performance of any provision hereof shall in no manner affect its
right at a later time to enforce the same. No waiver by a party of any condition
or of any breach of any term, covenant, representation or warranty contained in
this Agreement shall be effective unless in a writing signed by the party
against whom the waiver is to be effective, and no waiver in any one or more
instances shall be deemed to be a further or continuing waiver of any such
condition or breach in other instances or a waiver of any other condition or
breach of any other term, covenant, representation or warranty.

          Section 8.10 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original but all of which
shall constitute one and the same Agreement.

                                       24
<PAGE>
          Section 8.11 SUBMISSION TO JURISDICTION. ANY LEGAL ACTION OR
PROCEEDING WITH RESPECT TO THIS AGREEMENT AND ANY ACTION FOR ENFORCEMENT OF ANY
JUDGMENT IN RESPECT THEREOF MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW
YORK OR OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK
AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH PARTY HERETO HEREBY
ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, THE NON-EXCLUSIVE JURISDICTION OF THE AFORESAID COURTS AND THE
APPELLATE COURTS THEREOF. EACH PARTY HERETO IRREVOCABLY CONSENTS TO THE SERVICE
OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR
PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL,
POSTAGE PREPAID, TO SUCH PARTY AT THE ADDRESS FOR NOTICES SET FORTH HEREIN. EACH
PARTY HERETO HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR
PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT BROUGHT IN THE
COURTS REFERRED TO ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO
PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN
ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

          Section 8.12 Injunctive Relief. Each party hereto acknowledges and
agrees that a violation of any of the terms of this Agreement will cause the
other parties irreparable injury for which an adequate remedy at law is not
available. Therefore, the Stockholders agree that each party shall be entitled
to, an injunction, restraining order, specific performance or other equitable
relief from any court of competent jurisdiction, restraining any party from
committing any violations of the provisions of this Agreement.

          Section 8.13 Recapitalizations, Exchanges, Etc. Affecting the shares
of Common Stock; New Issuances. The provisions of this Agreement shall apply, to
the full extent set forth herein with respect to Company Securities and to any
and all equity or debt securities of the Company or any successor or assign of
the Company (whether by merger, consolidation, sale of assets, or otherwise)
which may be issued in respect of, in exchange for, or in substitution of, such
Company Securities and shall be appropriately adjusted for any stock dividends,
splits, reverse splits, combinations, reclassifications, recapitalizations,
reorganizations and the like occurring after the date hereof.

          Section 8.14 Other Ventures. It is expressly agreed that the
Stockholders and any Affiliates, officers, directors, managers, stockholders,
partners or employees of such Stockholders, may engage in other business
ventures of every nature and description, whether or not in competition with the
Company, independently or with others, and neither the Company nor the
Stockholders shall have any rights in and to any independent venture or activity
or the income or profits derived therefrom.

                                       25
<PAGE>
          Section 8.15 Termination. This Agreement shall terminate and the terms
of this Agreement shall be of no further force and effect upon the earliest to
occur of the following: (i) the mutual consent of all of the parties hereto,
(ii) the consummation of the Initial Public Offering, (iii) solely with respect
to the Fortress Stockholders, such time as the Fortress Stockholders and their
respective Affiliates and Permitted Transferees cease to Beneficially Own any
Company Securities, and (iv) solely with respect to the HP Stockholders, such
time as the HP Stockholders and their respective Affiliates and Permitted
Transferees cease to Beneficially Own any Company Securities; provided, however,
that the provisions of Sections 3.1(e), 8.5, 8.11 and this Section 8.15 shall
survive the termination of this Agreement.

                  [Remainder of page left blank intentionally]

                                       26
<PAGE>
          IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered by their respective officers thereunto duly as of the
date first above written.

                                        BROOKDALE SENIOR LIVING INC.

                                        By: /s/ R. Stanley Young
                                            ------------------------------------
                                        Name: R. Stanley Young
                                              ----------------------------------
                                        Title:
                                               ---------------------------------

                                        FORTRESS BROOKDALE ACQUISITION LLC

                                        By: /s/ Randal A. Nardone
                                            ------------------------------------
                                        Name: Randal A. Nardone
                                              ----------------------------------
                                        Title:
                                               ---------------------------------

                                        FORTRESS INVESTMENT TRUST II

                                        By: /s/ Randal A. Nardone
                                            ------------------------------------
                                        Name: Randal A. Nardone
                                              ----------------------------------
                                        Title: Chief Operating Officer
                                               ---------------------------------

                                        HEALTH PARTNERS

                                        By: Capital Z Financial Services Fund
                                            II, L.P., its General Partner

                                        By: Capital Z Partners, L.P., its
                                            General Partner

                                        By: Capital Z Partners, Ltd, its
                                            General Partner

                                        By: /s/ Roland Burnardon
                                            ------------------------------------
                                        Name: Roland Burnardon
                                              ----------------------------------
                                        Title: CFO
                                               ---------------------------------
<PAGE>
                                                                      SCHEDULE A

                        TERMS OF INITIAL PUBLIC OFFERING

1.   Underwriting of Initial Public Offering shall be on a "firm commitment"
     basis.

2.   After consummation of Initial Public Offering, the Common Stock shall be
     listed on the New York Stock Exchange or Nasdaq.

3.   The equity value of all outstanding Common Stock immediately prior to the
     consummation of the Initial Public Offering shall aggregate at least $600
     million, based on the gross per share price for the shares of Common Stock
     to be offered in the Initial Public Offering.

                                        2
<PAGE>
                                                                      SCHEDULE B

                      TERMS OF PROPOSED BORROWING FACILITY

                                        3

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