Fortress Reports Fourth Quarter & Year End 2012 Results

  Fortress Reports Fourth Quarter & Year End 2012 Results

                    Announces Dividend of $0.06 per Share

Business Wire

NEW YORK -- February 27, 2013

Fortress Investment Group LLC (NYSE: FIG) today reported its fourth quarter
and year end 2012 financial results.

FINANCIAL SUMMARY

  *Announced 20% increase in base quarterly dividend to $0.06 per dividend
    paying share, effective for the fourth quarter of 2012 and full year 2013
  *Repurchased 51.3 million dividend paying shares at a price of $3.50 per
    share, representing approximately 10% of dividend-paying shares
    outstanding
  *Assets under management (“AUM”) of $53.4 billion as of December 31, 2012,
    an increase of 4% from the third quarter of 2012 and 22% from the fourth
    quarter of 2011
  *GAAP net income of $222 million and $219 million for the fourth quarter
    and year ended December 31, 2012, respectively; GAAP book value per share
    of $2.60 as of December 31, 2012
  *Pre-tax distributable earnings (“DE”) of $107 million and $278 million for
    the fourth quarter and year ended December 31, 2012, respectively,
    compared to pre-tax DE of $50 million and $242 million for the fourth
    quarter and year ended December 31, 2011, respectively
  *Pre-tax DE per dividend paying share of $0.20 and $0.52 for the fourth
    quarter and year ended December 31, 2012, respectively, compared to
    pre-tax DE per dividend paying share of $0.09 and $0.46 for the fourth
    quarter and year ended December 31, 2011, respectively
  *Net cash and investments of $2.48 per dividend paying share as of December
    31, 2012, up from $2.17 per dividend paying share as of December 31, 2011
  *$649 million of embedded unrecognized incentive income across our funds
    and options in our permanent capital vehicles as of December 31, 2012
  *Uncalled capital, or “dry powder,” of $6.2 billion as of December 31,
    2012, including approximately $5.0 billion in newer vintage funds
    available for general investment purposes
  *Subsequent to year end, entered into a new $150 million revolving credit
    facility maturing in February 2016

BUSINESS HIGHLIGHTS

  *Raised $1.5 billion of capital across alternatives businesses in the
    fourth quarter, bringing total alternative capital raised in 2012 to $6.7
    billion
  *Recorded $0.2 billion of net client outflows for Logan Circle in the
    fourth quarter, bringing total net client inflows in 2012 to $5.7 billion
  *Delivered strong investment performance across all businesses:

       *Net fourth quarter 2012 returns of 4.2% in the Drawbridge Special
         Opportunities Fund LP, 6.0% in the Fortress Macro Funds and 9.5% in
         the Fortress Asia Macro Funds; net full year 2012 returns of 17.9%,
         17.8% and 21.2%, respectively
       *Private Equity fund valuations increased 3.9% during the quarter, and
         25.4% in 2012
       *Net annualized inception-to-date IRRs through year end for the Credit
         Opportunities Fund and Credit Opportunities Fund II of 26.9% and
         18.5%, respectively
       *13 of 15 Logan Circle strategies outperformed respective benchmarks
         in the fourth quarter and 14 of 15 strategies outperformed respective
         benchmarks in 2012

  *Subsequent to year end, raised $764 million of permanent equity capital
    for Newcastle Investment Corp.

“We set and achieved aggressive objectives for 2012, and broad-based momentum
built into the close of the year and carried into 2013,” said Randal Nardone,
interim Chief Executive Officer. “Our fourth quarter distributable earnings
were the highest we have recorded in two years, and we believe only begin to
reflect the potential of our company. Investment performance, the most
important driver of our success, was outstanding across all of our businesses
in 2012, and early 2013 returns in our main Liquid Markets funds have built
further on 2012 results. Our strong performance has contributed to robust
capital raising, with commitments from new and existing investors totaling
$6.7 billion for 2012, and over $1.6 billion in the first two months of 2013.
We are pleased with our performance to date and optimistic about our prospects
looking ahead.”

“We announced today a 20% increase in our base quarterly dividend, to $0.06
per dividend paying share. This increase reflects visibility into higher
management fees in the near-term, driven by the substantial amount of capital
raised over the past 14 months, and expectations for increases in AUM going
forward. This action supplements a $179 million, or $0.36 per dividend paying
share, investment made in the fourth quarter to repurchase nearly 10% of
outstanding shares at a substantial discount. We believe that these actions
will generate significant value for our current investors in 2013 and beyond.”

SUMMARY FINANCIAL RESULTS

Fortress’s business model is highly diversified, and management believes that
this positions the company to capitalize on opportunities for investing,
capital formation and harvesting profits that can occur at different points in
any cycle for our individual businesses. Fortress’s business model generates
stable and predictable management fees, which is a function of the majority of
alternative assets under management residing in long-term investment
structures. Fortress’s alternatives businesses also generate variable
incentive income based on performance, and this incentive income can
contribute meaningfully to financial results. Balance sheet investments
represent a third component of Fortress’s business model, and the company has
built substantial value in these investments, which are made in Fortress funds
alongside the funds’ limited partners.

The table below summarizes Fortress’s operating results for the fourth quarter
and year ended December 31, 2012. The consolidated GAAP statement of
operations and balance sheet are presented at the end of this press release.

                                                                                             
                  4Q           3Q             4Q             % Change         FY                          %
                                                                                                          Change
                   2012        2012         2011        QoQ   YoY       2012      2011        YoY
(in millions,
except per
share amount)
GAAP
Net income        $ 222        $ 7            $ (234   )     N/M     N/M      $ 219        $ (1,117 )     N/M
(loss)
Net income
(loss)
attributable      $ 102        $ 1           $ (91    )     N/M     N/M      $ 78         $ (432   )     N/M
to Class A
Shareholders
Per diluted       $ 0.24       $ (0.04  )     $ (0.49  )     N/M     N/M      $ 0.27       $ (2.36  )     N/M
share
Weighted
average Class
A shares            525          520            496                             525          493
outstanding,
diluted
                                                                                                          
Distributable
Earnings
(non-GAAP)
Fund              $ 105        $ 63           $ 53           67%     98%      $ 277        $ 253          9%
management DE
Pre-tax DE        $ 107        $ 64          $ 50          67%     114%     $ 278        $ 242         15%
Per dividend
paying            $ 0.20       $ 0.12        $ 0.09        69%     124%     $ 0.52       $ 0.46        13%
share/unit
Weighted
average
dividend            530          537            531                             533          528
paying shares
and units
outstanding
                                                                                                          
Assets Under
Management
Private           $ 14,271     $ 14,718       $ 12,466       -3%     14%      $ 14,271     $ 12,466       14%
Equity
Credit              13,414       11,753         12,208       14%     10%        13,414       12,208       10%
Liquid              5,060        4,378          5,515        16%     -8%        5,060        5,515        -8%
Markets
Logan Circle       20,685      20,626       13,524      0%      53%       20,685      13,524      53%
Total Assets
Under             $ 53,430     $ 51,475      $ 43,713      4%      22%      $ 53,430     $ 43,713      22%
Management
                                                                                                          

CONSOLIDATED GAAP RESULTS

Fortress recorded GAAP net income of $222 million, or $0.24 per diluted share
for the fourth quarter of 2012, compared with a GAAP net loss of $234 million,
or $0.49 loss per diluted share, for the fourth quarter of 2011. Our diluted
earnings per share for all periods presented includes the income tax effects
to net income (loss) attributable to Class A Shareholders from the assumed
conversion of Fortress Operating Group Units and fully vested Restricted
Partnership Units to Class A shares.

The year-over-year improvement in Fortress’s GAAP results was primarily driven
by higher incentive income and the expiration of the Principals Agreement and
related compensation expense, a non-economic amortization expense that had
accounted for approximately $4.8 billion in compensation expense between the
first quarter of 2007 and the fourth quarter of 2011. No amounts were ever
paid, or equity issued, in connection with this agreement. This agreement
expired at the end of 2011 and will no longer impact Fortress’s financial
results.

CONSOLIDATED SEGMENT RESULTS (NON-GAAP)

This section provides information about each of Fortress’s businesses: (i)
Credit, (ii) Private Equity, (iii) Liquid Hedge Funds, and (iv) Logan Circle.

Fortress uses “distributable earnings,” or DE, as a primary metric to manage
its businesses and gauge the company’s performance, and it uses DE exclusively
to report segment results. Consolidated segment results are non-GAAP
information and are not presented as a substitute for Fortress’s GAAP results.
Fortress urges you to read “Non-GAAP Information” below.

               
                  As of December 31, 2012
                               Private Equity             Liquid      Credit Funds              Logan
                                                              Hedge                                     Circle
(in millions)     Total          Funds        Castles       Funds         Hedge       PE Funds      Partners
                                                                            Funds
                                                                                                        
Assets Under      $ 53,430       $ 10,611       $ 3,660       $ 5,060       $ 5,665       $ 7,749       $ 20,685
Management^1
Dry Powder        $ 6,150        $ 750            N/A           N/A           N/A         $ 5,400         N/A
Average
Management                         1.2    %       1.5   %       1.7   %       2.0   %       1.4   %       0.2    %
Fee Rate^2
                                                                                                        
Incentive
Eligible NAV
Above             $ 16,269       $ 211          $ -           $ 3,095       $ 4,627       $ 8,336         N/A
Incentive
Income
Threshold^3
                                                                                                        
Undistributed
Incentive         $ 649          $ 11           $ 29          $ 6           $ 94          $ 509           N/A
Income:
Unrecognized
Undistributed
Incentive          -            -            -           -           -           -           N/A    
Income:
Recognized
Undistributed
Incentive         $ 649         $ 11          $ 29         $ 6          $ 94         $ 509         N/A    
Income^4
                                                                                                        
                  Three Months Ended December 31, 2012
                                 Private Equity               Liquid        Credit Funds                Logan
                                                              Hedge                                     Circle
(in millions)     Total          Funds          Castles       Funds         Hedge         PE Funds      Partners
                                                                            Funds
                                                                                                        
Third-Party
Capital           $ 1,485        $ 71           $ 6           $ 546         $ 31          $ 831           N/A
Raised
                                                                                                        
Segment
Revenues
Management        $ 131          $ 31           $ 14          $ 19          $ 25          $ 34          $ 8
fees
Incentive          114          2            -           47          38          27          -      
income
Total               245            33             14            66            63            61            8
Segment
Expenses
Operating           (91    )       (11    )       (4    )       (23   )       (16   )       (26   )       (11    )
expenses
Profit
sharing             (42    )       (1     )       -             (10   )       (18   )       (13   )       -
compensation
expenses
Unallocated        1            -            -           -           -           -           -      
Expenses
Total              (132   )      (12    )      (4    )      (33   )      (34   )      (39   )      (11    )
                                                                                                        
Principal
Performance
Payments
                    (8     )       -              -             (3    )       (4    )       (1    )       -
                                                                                                  
Fund              $ 105         $ 21          $ 10         $ 30         $ 25         $ 21         $ (3     )
Management DE
Pre-tax
Distributable     $ 107         $ 21          $ 10         $ 30         $ 25         $ 21         $ (3     )
Earnings
                                                                                                        

Pre-tax DE was $107 million in the fourth quarter of 2012, up from $50 million
in the fourth quarter of 2011. The year-over-year increase was primarily due
to higher incentive income and management fees earned from our funds,
partially offset by higher compensation related expenses.

Management fees were $131 million in the fourth quarter of 2012, up from $121
million for the fourth quarter of 2011, primarily due to higher management
fees from the Credit Private Equity Funds and Logan Circle, partially offset
by lower management fees from the Liquid and Credit Hedge Funds. Notably, 84%
of the alternative assets under management at year end were in funds with
long-term, locked-up structures, which provides for a stable, predictable base
of management fees.

_______________________________

^1 The Assets Under Management presented for the Credit Hedge Funds includes
$496 million related to the third-party originated Value Recovery Funds.
Fortress earns fees from the Value Recovery Funds based only on collections.

^2 The Average Management Fee Rate presented for the Credit Hedge Funds
excludes the third-party originated Value Recovery Funds. See footnote (1)
above.

^3 The Incentive Eligible NAV Above Threshold presented for hedge funds
excludes sidepocket investments. The Incentive Eligible NAV Above Threshold
presented for Private Equity Funds and Credit Private Equity Funds represents
total fund NAV.

^4 The Undistributed Incentive Income presented includes the impact of
sidepocket investments on hedge funds. Undistributed Incentive Income for
Private Equity Funds, Credit Private Equity Funds and hedge fund sidepocket
and redeeming capital account (RCA) investments has not been recognized in
Distributable Earnings and will be recognized when realized; Undistributed
Incentive Income for other hedge fund investments was recognized in
Distributable Earnings when earned. Undistributed Incentive Income for Private
Equity Funds includes incentive income amounts of which Fortress is entitled
to approximately 50%. Undistributed Incentive Income for Private Equity
Castles includes incentive income that would have been recorded in
Distributable Earnings if Fortress had exercised all of its in-the-money
Newcastle options and sold all of the resulting shares at their December 31,
2012 closing price.

Incentive income recorded in the fourth quarter of 2012 totaled $114 million,
compared to $46 million recorded in the fourth quarter of 2011. This
year-over-year increase was driven by higher incentive income generated by the
Liquid Hedge Funds, Credit Hedge Funds, Credit Private Equity Funds and
Private Equity Funds. Additionally, Fortress had $649 million in
undistributed, unrecognized incentive income based on investment valuations at
December 31, 2012. This includes $620 million from our funds and $29 million
from options in our permanent capital vehicles.

The Company’s segment revenues and distributable earnings will fluctuate
materially depending upon the performance of its funds and the realization
events within its private equity businesses, as well as other factors.
Accordingly, the revenues and profits in any particular period should not be
expected to be indicative of future results.

ASSETS UNDER MANAGEMENT

As of December 31, 2012, assets under management (“AUM”) totaled $53.4
billion, up 4% from $51.5 billion as of September 30, 2012 and up 22% from
$43.7 billion as of December 31, 2011. During the fourth quarter of 2012,
Fortress raised $1.4 billion of capital that was directly added to AUM, had a
$1.4 billion increase in invested capital and had a $1.0 billion increase in
its fund valuations. These increases to AUM were partially offset by (i) $1.4
billion of capital distributions to investors, (ii) $0.2 billion of RCA
payments to Credit Hedge Fund investors and (iii) $0.2 billion of net client
outflows for Logan Circle. As of December 31, 2012, the Private Equity Funds
and Credit PE Funds had approximately $0.8 billion and $5.4 billion of
uncalled capital, respectively, that will become assets under management if
deployed/called. Uncalled capital in our Credit PE Funds includes $1.1 billion
that is only available for follow-on investments, management fees and other
fund expenses.

BUSINESS SEGMENT RESULTS

Below is a discussion of fourth quarter 2012 segment results and business
highlights.

Credit:

  *Drawbridge Special Opportunities Fund LP had a net return of 4.2% for the
    fourth quarter of 2012 and 17.9% for the year ended December 31, 2012
  *Raised $0.9 billion of third party capital in the fourth quarter, bringing
    total capital raised in full year 2012 to $4.6 billion
  *Deployed $0.9 billion of capital during the quarter and distributed $0.4
    billion of capital back to limited partners
  *Held final close for Fortress Japan Opportunity Fund II (“FJOF II”) at its
    cap of ¥130 billion, or approximately $1.7 billion

(See supplemental data on pages 19-20 for more detail on Credit results)

The Credit business, which includes our Credit Hedge Funds and Credit Private
Equity Funds, generated pre-tax DE of $46 million in the fourth quarter of
2012, which is up from $29 million in the fourth quarter of 2011. During the
fourth quarter, the business recorded $65 million of incentive income,
comprised of $38 million from hedge funds and $27 million from private-equity
style funds.

On a full year basis, pre-tax DE of $126 million is down slightly from $138
million for full year 2011. This is largely attributable to lower incentive
income distributions from our private-equity style funds and higher
compensation related expenses, partially offset by higher incentive income
from our hedge funds.

In our Credit Hedge funds, the Drawbridge Special Opportunities Funds
continued to deliver strong investment performance in the fourth quarter. The
onshore fund had a net return of 4.2% in the quarter, bringing full year net
returns to 17.9% through December 31, 2012. Net annualized inception-to-date
returns in this fund increased to 11.1%. The Credit Hedge Fund segment had a
total of $4.6 billion of incentive eligible NAV above performance thresholds
as of December 31, 2012.

Fortress’s Credit Private Equity Funds also delivered strong investment
performance in the fourth quarter, which contributed to a further increase in
unrealized, undistributed incentive income. The Credit Opportunities Fund and
Credit Opportunities Fund II had net annualized inception-to-date IRRs of
26.9% and 18.5%, respectively, through December 31, 2012. Unrealized,
undistributed incentive income increased $79 million, or 18%, to $509 million
in the fourth quarter and has increased $264 million, or 108%, since December
31, 2011.

The Credit team deployed $0.9 billion of dry powder for investments and
returned $0.4 billion of capital to our investors in the quarter. For the year
ended December 31, 2012, Credit deployed over $2.8 billion of dry powder and
returned $2.2 billion of capital to investors. Total Credit Private Equity dry
powder – capital committed to the funds but not yet generating management fees
– was $5.4 billion as of year end. Of that total, $1.1 billion is only
available for follow-on investments, management fees and other fund expenses.

Total capital raised during the fourth quarter and year ended December 31,
2012 was $0.9 billion and $4.6 billion, respectively. Capital raised in the
fourth quarter was primarily for our second Japan real estate credit fund,
FJOF II, which we successfully closed at its cap of ¥130 billion, or
approximately $1.7 billion. FJOF II is a successor fund to the Fortress Japan
Opportunity Domestic Fund (“FJOF”), which closed in June 2010 at its cap of
approximately $800 million. FJOF had an inception-to-date net annualized IRR
of 20.5% through December 31, 2012.

“Investment performance in 2012 was strong across our Credit private equity
and hedge fund strategies," said Pete Briger, Fortress co-Chairman and Credit
business co-CIO. "Looking at investment opportunities today, we believe the
Credit markets continue to price in far too much optimism and that actual risk
exceeds perceived risk by a substantial margin. Over the longer-term, we
believe the market should present more compelling opportunities further into
the current cycle. The opportunity set that we see in the near- or medium-term
will depend in large part on our broad sourcing capabilities and the extent to
which European financial institutions accelerate their pace of deleveraging.
We will remain patient and opportunistic investors, focused on generating
outstanding risk-adjusted returns for our limited partners.”

Private Equity:

  *Fund portfolio investment valuations increased 3.9% in the fourth quarter
    of 2012, bringing full year 2012 appreciation to 25.4%
  *Raised $77 million of capital in the fourth quarter, bringing total
    alternative and permanent equity capital raised in full year 2012 to $1.1
    billion
  *Subsequent to year end, raised $764 million of permanent equity capital
    for Newcastle Investment Corp.
  *Subsequent to year end, Newcastle announced plans to spin off all of its
    investments in mortgage servicing rights (“MSRs”) and other residential
    assets into a new publicly traded residential-focused mortgage REIT
  *Subsequent to year end, announced plans to sell remaining interest in
    SeaCube Container Leasing (NYSE: BOX)

(See supplemental data on page 18 for more detail on Private Equity results)

The Private Equity business, which includes Private Equity Funds and Castles,
had pre-tax DE of $31 million in the fourth quarter of 2012, up slightly from
$29 million in the fourth quarter of 2011. Full year 2012 pre-tax DE was $115
million, down $3 million from full year 2011, largely due to lower Private
Equity Fund management fees that resulted from changes in the basis on which
these fees are calculated in three funds, partially offset by increased
Private Equity Fund incentive income. The majority of this incentive income
was attributable to an $8 million reversal of previously recognized claw-back
reserves recorded for Fund II.

Private Equity Fund investment performance in the fourth quarter and year
ended December 31, 2012 was strong, with valuations in underlying investments
increasing by 3.9% and 25.4%, respectively. Full year appreciation of these
fund investments was driven primarily by our public company investments, which
increased 65% in 2012.

During the quarter, fundraising activity included $71 million in capital
raised for transportation and infrastructure investments in our WWTAI Fund.
Subsequent to year end, we raised an additional $221 million of capital,
bringing total capital raised to date for WWTAI to $372 million. For the year
ended December 31, 2012, the Private Equity segment raised over $1.1 billion
of capital and distributed over $1.0 billion of capital back to investors.
Fundraising activity in 2012 was highlighted by the nearly $600 million launch
of our MSR Opportunities Funds, as well as $435 million of permanent equity
capital raised for Newcastle Investment Corp. (NYSE: NCT). NCT raised an
additional $764 million of permanent equity capital in the first two months of
2013, bringing total permanent equity capital raised by NCT in the last 12
months to $1.2 billion.

In January 2013, NCT announced plans to spin off all of its investments in
MSRs and certain other residential assets into a new publicly traded real
estate investment trust, New Residential Investment Corp. (“New Residential”).
New Residential will be externally managed by an affiliate of Fortress and
will primarily target opportunistic investments in MSRs, RMBS, servicing
advances, non-performing loans and other real estate related investments.

Also in January 2013, SeaCube Container Leasing announced an agreement to sell
100% of its outstanding shares for $23.00 per common share. SeaCube (NYSE:
BOX) is the container leasing subsidiary of Seacastle Inc., an intermodal
equipment leasing operator Fortress formed in 2007. At the time of the
announcement, Fortress Funds owned 8.4 million SeaCube common shares in Fund
III, Fund III Co, Fund IV and Fund IV Co.

“For Fortress Private Equity, 2012 was a pivotal year in which we delivered
significant valuation gains in our main funds while building out new
strategies that we believe will be transformative for our business over time,”
said Wes Edens, Fortress co-Chairman and Private Equity CIO. “With 25%
valuation gains in 2012, we’ve seen a $6 billion increase in our Private
Equity investment valuations over the past three years, and we see growing
potential to generate significant value in our most recent vintage funds. We
also had great success in raising capital for new sector-specific funds—WWTAI
and our MSR Opportunities Funds—and in raising permanent equity capital
through Newcastle. Altogether, we have raised over $2.1 billion in
sector-specific funds and permanent equity over the past 14 months. We believe
that the opportunities we are focused on can attract meaningful capital in
strategies that can generate substantial long-term value and growth.”

Liquid Hedge Funds:

  *Fortress Macro Fund had a net return of 6.0% for the fourth quarter of
    2012 and 17.8% for the year ended December 31, 2012
  *Fortress Asia Macro Fund had a net return of 9.5% for the fourth quarter
    of 2012 and 21.2% for the year ended December 31, 2012
  *Raised approximately $546 million in new third-party capital during the
    quarter, bringing total third-party capital raised in 2012 to $1.0 billion
  *Fortress Asia Macro Fund was named “Best Global Macro Fund” at the HFMWeek
    2012 Asia Performance Awards

(See supplemental data on page 21 for more detail on Liquid Hedge Funds
results)

The Liquid Hedge Funds generated pre-tax DE of $30 million in the fourth
quarter of 2012 and $45 million for the year ended December 31, 2012. Pre-tax
DE was up $22 million from the previous quarter, largely a result of increased
incentive income from continued positive investment performance.

Net returns for the fourth quarter of 2012 for the Fortress Macro Funds,
Fortress Asia Macro Funds and Fortress Partners Funds were 6.0%, 9.5% and
1.0%, respectively. Net returns for the year ended December 31, 2012 for the
Fortress Macro Funds, Fortress Asia Macro Funds and Fortress Partners Funds
were 17.8%, 21.2% and 8.0%, respectively.

In 2012, the Liquid Hedge Funds generated $68 million of incentive income, $47
million of which was generated in the fourth quarter. This is primarily
attributable to strong full year performance bringing nearly all main Fortress
Macro Fund capital above high water marks and thus eligible to generate
incentive income. In aggregate, approximately $3.1 billion of capital was
above respective high water marks at year end, a $2.9 billion increase from
the end of last year.

Liquid Hedge Funds finished the fourth quarter with $5.1 billion of AUM, up
16% from the previous quarter primarily due to $546 million of capital raised
and $267 million of appreciation, partially offset by $80 million of
redemptions. As of December 31, 2012, there were $0.4 billion of Liquid Hedge
Fund redemption notices outstanding, which will be paid primarily within one
quarter.

Positive investment performance and capital raising momentum has continued in
2013, as the Fortress Macro Funds and Fortress Asia Macro Funds had estimated
year-to-date net returns of 4.5% and 1.7%, respectively, through February 22,
2013. Subsequent to year end, the Liquid Hedge Funds have raised nearly $600
million of additional capital, which will be added to AUM in the first quarter
of 2013.

“Our investment returns in the Fortress Macro Fund and Asia Macro Fund placed
us in the top tier of our industry,” said Mike Novogratz, Fortress Principal
and co-CIO of Macro Funds. “Net returns of nearly 18% in Macro and over 21% in
Asia Macro reflect the type of performance we strive to deliver for our
limited partners, and we are off to a strong start in 2013. As a result of our
performance, we have seen a significant increase in capital raised, with
nearly $550 million in the fourth quarter, over half our total for the year.
With over $3 billion, virtually all main fund NAV, over high water marks at
the close of 2012, we are positioned well to deliver strong financial
performance in 2013.”

Logan Circle:

  *13 of 15 Logan Circle investment strategies outperformed their respective
    benchmarks for the fourth quarter of 2012, and 14 of 15 strategies
    outperformed respective benchmarks for the year ended December 31, 2012
  *Total traditional fixed income AUM rose to $20.7 billion as of quarter
    end, an increase of 53% from the fourth quarter of 2011
  *Net client outflows were $0.2 billion in the fourth quarter of 2012,
    bringing net client inflows to $5.7 billion for the year ended December
    31, 2012

(See supplemental data on page 22 for more detail on Logan Circle results)

Logan Circle, our traditional asset management business, generated a pre-tax
DE loss of $3 million and $10 million in the fourth quarter and year ended
December 31, 2012, respectively. This compares to a pre-tax DE loss of $5
million and $17 million in the fourth quarter and year ended December 31,
2011, respectively. The year-over-year improvement is primarily due to an
increase in management fees driven by a $7.2 billion increase in assets under
management.

Logan Circle’s strategies continued to deliver strong investment performance,
with 13 of Logan Circle’s 15 strategies outperforming their respective
benchmarks for the fourth quarter of 2012 and 14 of 15 strategies
outperforming respective benchmarks for the year ended December 31, 2012.
Notably, 14 of 15 Logan Circle strategies have also outperformed their
respective benchmarks since inception and eight are ranked in the top quartile
of performance for their competitor universe.

Logan Circle had $20.7 billion in AUM at the end of the quarter, flat compared
to the previous quarter and a 53% increase compared to the fourth quarter of
2011. The $7.2 billion annual increase in AUM was driven by net client inflows
of $5.7 billion and performance appreciation of $1.5 billion. Logan Circle’s
AUM has grown over 80% since Fortress completed the acquisition in April 2010.

“For Logan Circle, 2012 was an extremely successful year, in which we saw
sustained investment outperformance and capital raising efforts that hit an
entirely new trajectory,” said Jude Driscoll, Logan Circle Partners Chief
Executive Officer. “We captured significant market share during the year, with
strong demand for our fixed-income strategies from an increasingly broad
universe of investors. As a result, our AUM increased by over 50% over last
year, and our current pipe-line for potential additional commitments is
robust. We remain focused on building further on our record of strong
investment performance, and believe we are well-positioned to generate
substantial organic growth and to become a material contributor to Fortress’s
profitability over time.”

Principal Investments:

The Principal Investments segment, which is comprised of Fortress’s
investments in its own funds, generated pre-tax DE of $2 million and $1
million for the fourth quarter and year ended December 31, 2012, respectively,
compared to a pre-tax DE loss of $3 million and $11 million for the fourth
quarter and year ended December 31, 2011, respectively. This year-over-year
improvement is largely a result of the positive performance of our investments
in our funds and a decline in interest expense.

As of December 31 2012, Principal Investments had segment assets (excluding
cash and cash equivalents) totaling $1.2 billion, up 16% from December 31,
2011. As of December 31, 2012, Fortress had a total of $156 million of
outstanding commitments to its funds.

In addition, as of December 31, 2012, the net asset value of Fortress’s
Principal Investments exceeded its segment cost basis by $469 million,
representing net unrealized gains that have not yet been recognized for
segment reporting purposes. This is up 61%, or $179 million, from December 31,
2011.

LIQUIDITY & CAPITAL

As of December 31, 2012, Fortress had cash and cash equivalents of $104
million, down from $333 million as of December 31, 2011. As of January 31,
2013, Fortress had cash and cash equivalents of $312 million.

In October 2012, the completed sale of private equity portfolio company
RailAmerica resulted in Fortress receiving aggregate proceeds of $182 million.
Fortress used these proceeds to pay down in full its remaining corporate term
loan balance of $181 million.

In connection with the purchase of 51.3 million class A or equivalent shares
from a former Principal for an aggregate of $179 million in December 2012,
Fortress issued a $149 million promissory note to the Principal, which bears
interest at 5% and matures based on the following schedule: $40 million in
March 2013, $20 million in June 2013, $30 million in September 2013 and $59
million in February 2014.

In February 2013, Fortress terminated its existing $60 million revolving
credit facility and entered into a new $150 million facility with a $15
million letter of credit subfacility.

DIVIDEND

Fortress’s Board of Directors declared a fourth quarter 2012 dividend of $0.06
per dividend paying share, bringing full year 2012 distributions to $0.21 per
dividend paying share. The dividend is payable on March 15, 2013 to Class A
shareholders of record as of the close of business on March 12, 2013.

Fortress announced an increase in its base quarterly dividend, effective for
the fourth quarter of 2012 and full year 2013, to $0.06 per dividend paying
share, up 20% from $0.05 per dividend paying share.

The declaration and payment of any distributions are at the sole discretion of
the Board of Directors, which may decide to change its distribution policy at
any time. Please see below for information on the U.S. federal income tax
implications of the dividend.

NON-GAAP INFORMATION

Distributable earnings, or DE, is a primary metric used by management to
measure Fortress’s operating performance. Consistent with GAAP, DE is the sole
measure that management uses to manage, and thus report on, Fortress’s
segments, namely: Private Equity, Castles, Credit Hedge Funds, Credit Private
Equity Funds, Liquid Hedge Funds, Logan Circle and Principal Investments. DE
differs from GAAP net income in a number of material ways. For a detailed
description of the calculation of DE, see note 11 in the financial statements
included in the Company’s most recent annual report on Form 10-K, or note 10
to the financial statements included in the Company’s most recent quarterly
report on Form 10-Q.

Fortress aggregates its segment results to report consolidated segment
results, as shown in the table under “Summary Financial Results” and in the
“total” column of the table under “Consolidated Segment Results (Non-GAAP).”
The consolidated segment results are non-GAAP financial information.
Management believes that consolidated segment results provide a meaningful
basis for comparison among present and future periods. However, consolidated
segment results should not be considered a substitute for Fortress’s
consolidated GAAP results. The exhibits to this release contain
reconciliations of the components of Fortress’s consolidated segment results
to the comparable GAAP measures, and Fortress urges you to review these
exhibits.

CONFERENCE CALL

Management will host a conference call today, Wednesday, February 27, 2013 at
10:00 A.M. Eastern Time. A copy of the earnings release is posted to the
Investor Relations section of Fortress’s website, www.fortress.com.

All interested parties are welcome to participate on the live call. The
conference call may be accessed by dialing 1-888-243-2046 (from within the
U.S.) or 1-706-679-1533 (from outside of the U.S.) ten minutes prior to the
scheduled start of the call; please reference “Fortress Year End Earnings
Call.”

A simultaneous webcast of the conference call will be available to the public
on a listen-only basis at www.fortress.com. Please allow extra time prior to
the call to visit the site and download the necessary software required to
listen to the internet broadcast.

A telephonic replay of the conference call will also be available until 11:59
P.M. Eastern Time on Friday, March 8, 2013 by dialing 1-855-859-2056 (from
within the U.S.) or 1-404-537-3406 (from outside of the U.S.); please
reference access code “98939994.”

ABOUT FORTRESS

Fortress Investment Group LLC (NYSE: FIG) is a leading, highly diversified
global investment management firm with $53.4 billion in assets under
management as of December 31, 2012. Fortress applies its deep experience and
specialized expertise across a range of investment strategies - private
equity, credit, liquid hedge funds and traditional fixed income - on behalf of
over 1,400 institutional clients and private investors worldwide. For more
information regarding Fortress Investment Group LLC or to be added to its
e-mail distribution list, please visit www.fortress.com.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements in this press release may constitute “forward-looking
statements” within the meaning of the Private Securities Litigation Reform Act
of 1995, including statements regarding Fortress’s sources of management fees,
incentive income and investment income (loss), estimated fund performance and
the amount and source of expected capital commitments.These statements are
not historical facts, but instead represent only the Company’s beliefs
regarding future events, many of which, by their nature, are inherently
uncertain and outside of the Company’s control. It is possible that the
sources and amounts of management fees, incentive income and investment
income, the amount and source of expected capital commitments for any new fund
or redemption amounts may differ, possibly materially, fromthese
forward-looking statements, and any such differences could cause the Company’s
actual results to differ materially from the results expressed or implied by
these forward-looking statements. For a discussion of some of the risks and
important factors that could affect such forward-looking statements, see the
sections entitled “Risk Factors” and “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” in the Company’sAnnual Report
on Form 10-K, which is, or will be, available on the Company’s website
(www.fortress.com). In addition, new risks and uncertainties emerge from time
to time, and it is not possible for the Company to predict or assess the
impact of every factor that may cause its actual results to differ from those
contained in any forward-looking statements. Accordingly, you should not place
undue reliance on any forward-looking statements contained in this press
release. The Company can give no assurance that the expectations of any
forward-looking statement will be obtained. Such forward-looking statements
speak only as of the date of this press release. The Company expressly
disclaims any obligation to release publicly any updates or revisions to any
forward-looking statements contained herein to reflect any change in the
Company’s expectations with regard thereto or any change in events, conditions
or circumstances on which any statement is based.

U.S. FEDERAL INCOME TAX IMPLICATIONS OF DIVIDEND

For U.S. federal income tax purposes, the dividend declared in February 2013
will be treated as a partnership distribution. Based on the best information
currently available, when calculating withholding taxes, 2.30 cents of the per
share distribution will be treated as U.S. source interest income.
Accordingly, for non-U.S. holders of Class A shares, unless an exception to
withholding tax applies, the distribution will be subject to a U.S. federal
withholding tax of 0.69 cents per share. Non-U.S. holders of Class A shares
are generally subject to U.S. federal withholding tax at a rate of 30%
(subject to reduction by applicable treaty or other exception) on certain
types of U.S. source income realized by the Company. With respect to interest,
however, no withholding is generally required if proper certification (on an
IRS Form W-8) of a beneficial owner's foreign status has been filed with the
withholding agent. In addition, non-U.S. holders must generally provide the
withholding agent with a properly completed IRS Form W-8 to obtain any
reduction in withholding.

                                                      
Fortress Investment Group LLC

Consolidated Statements of Operations (Unaudited)

(dollars in thousands, except share data)
                                                           
                   Three Months Ended December 31,         Twelve Months Ended December 31,
                    2012            2011              2012            2011        
Revenues
Management
fees:              $ 119,155           $ 111,036           $ 456,090           $ 464,305
affiliates
Management
fees:                13,083              10,455              45,617              58,096
non-affiliates
Incentive
income:              207,444             110,942             246,438             155,303
affiliates
Incentive
income:              24,598              666                 26,162              1,917
non-affiliates
Expense
reimbursements       50,987              42,128              189,304             172,465
from
affiliates
Other revenues      2,373             1,109             6,258             6,542       
                    417,640           276,336           969,869           858,628     
Expenses
Interest             3,904               4,643               15,781              18,526
expense
Compensation         213,092             170,801             750,359             706,060
and benefits
Principals
agreement
compensation         -                   299,448             -                   1,051,197
(expired in
2011)
General,
administrative       33,784              36,181              127,149             145,726
and other
Depreciation
and
amortization        3,213             3,285             14,931            33,399      
(including
impairment)
                    253,993           514,358           908,220           1,954,908   
Other Income
(Loss)
Gains (losses)       19,379              (3,303      )       48,921              (30,054     )
Tax receivable
agreement            (1,935      )       3,214               (8,870      )       3,098
liability
adjustment
Earnings
(losses) from       46,113            15,518            156,530           41,935      
equity method
investees
                    63,557            15,429            196,581           14,979      
Income (Loss)
Before Income        227,204             (222,593    )       258,230             (1,081,301  )
Taxes
Income tax
benefit             (5,157      )      (11,542     )      (39,408     )      (36,035     )
(expense)
Net Income         $ 222,047          $ (234,135    )     $ 218,822          $ (1,117,336  )
(Loss)
Principals'
and Others'
Interests in
Income (Loss)      $ 119,840          $ (142,646    )     $ 140,538          $ (685,821    )
of
Consolidated
Subsidiaries
Net Income
(Loss)
Attributable       $ 102,207          $ (91,489     )     $ 78,284           $ (431,515    )
to Class A
Shareholders
Dividends
Declared Per       $ 0.05             $ -                $ 0.20             $ -           
Class A Share
                                                                               
                                                                               
Earnings
(Loss) Per
Class A Share
Net income
(loss) per         $ 0.40             $ (0.48       )     $ 0.29             $ (2.34       )
Class A share,
basic
Net income
(loss) per         $ 0.24             $ (0.49       )     $ 0.27             $ (2.36       )
Class A share,
diluted
Weighted
average number
of Class A          220,660,135       190,487,829       214,399,422       186,662,670 
shares
outstanding,
basic
Weighted
average number
of Class A          525,242,510       496,345,580       524,900,132       493,392,235 
shares
outstanding,
diluted
                                                                                             

                                                        
Fortress Investment Group LLC

Consolidated Balance Sheets

(dollars in thousands)
                                                             
                                       December 31, 2012     December 31, 2011
Assets
Cash and cash equivalents              $  104,242            $  333,166
Due from affiliates                       280,557               298,689
Investments                               1,249,761             1,079,777
Deferred tax asset                        402,135               400,196
Other assets                             124,798             108,858     
                                       $  2,161,493         $  2,220,686   
                                                             
Liabilities and Equity
                                                             
Liabilities
Accrued compensation and benefits      $  146,911            $  247,024
Due to affiliates                         357,407               354,158
Deferred incentive income                 231,846               238,658
Debt obligations payable                  149,453               261,250
Other liabilities                        59,226              57,204      
                                                             
                                         944,843             1,158,294   
                                                             
Commitments and Contingencies
                                                             
Equity
Class A shares, no par value,
1,000,000,000 shares authorized,
218,286,342
and 189,824,053 shares issued and
outstanding at December 31, 2012
and
December 31, 2011, respectively           -                     -
Class B shares, no par value,
750,000,000 shares authorized,
249,534,372
and 305,857,751 shares issued and
outstanding at December 31, 2012
and
December 31, 2011, respectively           -                     -
Paid-in capital                           2,119,102             1,972,711
Retained earnings (accumulated            (1,486,578  )         (1,484,120  )
deficit)
Treasury Shares (2,082,684 Class A        (3,419      )         -
shares held by subsidiary)
Accumulated other comprehensive          (2,634      )        (1,160      )
income (loss)
                                                             
Total Fortress shareholders'              626,471               487,431
equity
Principals' and others' interests
in equity of consolidated                590,179             574,961     
subsidiaries
Total Equity                             1,216,650           1,062,392   
                                       $  2,161,493         $  2,220,686   
                                                             

                                                                                                            
Fortress Investment Group LLC

Exhibit 1-a

Supplemental Data for the Three Months Ended December 31, 2012 and 2011
                                                                                                                       
                  Three Months Ended December 31, 2012
                               Private Equity             Liquid        Credit Funds                              Principal
                                                              Hedge
(in millions)     Total          Funds        Castles       Funds         Hedge         PE Funds      Logan          Investments
                                                                            Funds                       Circle
                                                                                                                       
Assets Under
Management
AUM - October     $ 51,475       $ 11,113       $ 3,605       $ 4,378       $ 5,663       $ 6,090       $ 20,626       $    -
1, 2012
Capital             1,408          -              -             546           31            831           -                 -
raised
Equity raised
(Permanent          6              -              6             -             -             -             -                 -
capital
vehicles)
Increase in
invested            1,426          65             -             7             1             1,353         -                 -
capital
Redemptions         (106   )       -              -             (80   )       (26   )       -             -                 -
SPV                 -              -              -             -             -             -             -                 -
distribution
RCA
distributions       (198   )       -              -             -             (198  )       -             -                 -
^5
Return of
capital             (1,351 )       (894   )       -             (57   )       -             (400  )       -                 -
distributions
Adjustment
for reset           -              -              -             -             -             -             -                 -
date
Crystallized
Incentive           (6     )       -              -             (1    )       (5    )       -             -                 -
Income
Equity              -              -              -             -             -             -             -                 -
buyback
Net Client          (225   )       -              -             -             -             -             (225   )          -
Flows
Income (loss)
and foreign        1,001        327          49          267         199         (125  )      284             -   
exchange
AUM - Ending        53,430         10,611         3,660         5,060         5,665         7,749         20,685            -
Balance
                                                                                                                       
Third-Party
Capital           $ 1,485       $ 71          $ 6          $ 546        $ 31         $ 831        $ -           $    -   
Raised
                                                                                                                       
Segment
Revenues
Management        $ 131          $ 31           $ 14          $ 19          $ 25          $ 34          $ 8            $    -
fees
Incentive          114          2            -           47          38          27          -               -   
income
Total               245            33             14            66            63            61            8                 -
                                                                                                                       
Segment
Expenses
Operating         $ (91    )     $ (11    )     $ (4    )     $ (23   )     $ (16   )     $ (26   )     $ (11    )     $    -
expenses
Profit
sharing             (42    )       (1     )       -             (10   )       (18   )       (13   )       -                 -
compensation
expenses
Unallocated        1            -            -           -           -           -           -               -   
Expenses
Total               (132   )       (12    )       (4    )       (33   )       (34   )       (39   )       (11    )          -
                                                                                                                
Fund
Management DE
(before            113          21           10          33          29          22          (3     )         -   
Principal
Performance
Payments)
                                                                                                                       
Principal
Performance         (8     )       -              -             (3    )       (4    )       (1    )       -                 -
Payments
                                                                                                                
Fund               105          21           10          30          25          21          (3     )         -   
Management DE
                                                                                                                       
Investment          6                                                                                                       6
Income
Interest            (4     )                                                                                                (4  )
Expense
                                                                                                                
Pre-tax
Distributable     $ 107         $ 21          $ 10         $ 30         $ 25         $ 21         $ (3     )     $    2   
Earnings
                                                                                                                       
Pre-tax
Distributable
Earnings per      $ 0.20   
Dividend
Paying Share
                                                                                                                       

               
                  Three Months Ended December 31, 2011
                               Private Equity            Liquid      Credit Funds                           Principal
                                                             Hedge
(in millions)     Total          Funds       Castles       Funds         Hedge       PE Funds      Logan          Investments
                                                                           Funds                       Circle
                                                                                                                      
Assets Under
Management
AUM - October     $ 43,619       $ 9,471       $ 3,237       $ 6,165       $ 6,214       $ 5,619       $ 12,913       $    -
1, 2011
Capital             198            -             -             177           21            -             -                 -
raised
Equity raised       -              -             -             -             -             -             -                 -
Increase in
invested            1,060          13            -             14            -             1,033         -                 -
capital
Redemptions         (722   )       -             -             (722  )       -             -             -                 -
SPV                 -              -             -             -             -             -             -                 -
distribution
RCA
distributions       (254   )       -             -             -             (254  )       -             -                 -
^ 5
Return of
capital             (384   )       (4    )       -             -             (21   )       (359  )       -                 -
distributions
Adjustment
for reset           -              -             -             -             -             -             -                 -
date
Crystallized
Incentive           -              -             -             -             -             -             -                 -
Income
Net Client          365            -             -             -             -             -             365               -
Flows
Income (loss)
and foreign        (169   )      (195  )      (56   )      (119  )      16          (61   )      245             -   
exchange
AUM - Ending      $ 43,713       $ 9,285       $ 3,181       $ 5,515       $ 5,976       $ 6,232       $ 13,524       $    -
Balance
                                                                                                                      
Third-Party
Capital           $ 1,818       $ -          $ -          $ 177        $ 21         $ 1,620      $ -           $    -   
Raised
                                                                                                                      
Segment
Revenues
Management        $ 121          $ 30          $ 14          $ 25          $ 26          $ 21          $ 5            $    -
fees
Incentive          46           -           -           -           28          18          -               -   
income
Total               167            30            14            25            54            39            5                 -
                                                                                                                      
Segment
Expenses
Operating         $ (89    )     $ (7    )     $ (8    )     $ (20   )     $ (33   )     $ (11   )     $ (10    )     $    -
expenses
Profit
sharing            (25    )      -           -           (5    )      (12   )      (8    )      -               -   
compensation
expenses
Total               (114   )       (7    )       (8    )       (25   )       (45   )       (19   )       (10    )          -
                                                                                                               
Fund               53           23          6           -           9           20          (5     )         -   
Management DE
                                                                                                                      
Investment          2                                                                                                      2
Income
Interest            (5     )                                                                                               (5  )
Expense
                                                                                                        
Pre-tax
Distributable     $ 50          $ 23         $ 6          $ -          $ 9          $ 20         $ (5     )     $    (3  )
Earnings
                                                                                                                      
Pre-tax
Distributable
Earnings per      $ 0.09   
Dividend
Paying Share

______________________________________

^5 Represents distributions from (i) assets held by redeeming capital accounts
in the Drawbridge Special Opportunities Funds, and (ii) the Value Recovery
Funds.

                                                                                                             
Fortress Investment Group LLC

Exhibit 1-b

Supplemental Data for the Year Ended December 31, 2012 and 2011
                                                                                                                          
                  Full Year Ended December 31, 2012
                               Private Equity               Liquid         Credit Funds                                Principal
                                                              Hedge
(in millions)     Total          Funds        Castles       Funds          Hedge          PE Funds       Logan          Investments
                                                                             Funds                         Circle
Assets Under
Management
AUM - January     $ 43,713       $ 9,285        $ 3,181       $ 5,515        $ 5,976        $ 6,232        $ 13,524       $    -
1, 2012
Capital             2,298          -              -             993            247            1,058          -                 -
raised
Equity raised       450            -              450           -              -              -              -                 -
Increase in
invested            3,008          163            -             7              21             2,817          -                 -
capital
Redemptions         (2,082 )       -              -             (2,045 )       (37    )       -              -                 -
SPV                 -              -              -             -              -              -              -                 -
distributions
RCA
distributions       (1,100 )       -              -             -              (1,100 )       -              -                 -
^ 6
Return of
capital             (3,326 )       (1,036 )       -             (93    )       (233   )       (1,964 )       -                 -
distributions
Adjustment
for reset           (331   )       -              -             -              -              (331   )       -                 -
date
Crystallized
incentive           (79    )       -              -             (3     )       (76    )       -              -                 -
income
Equity              -              -              -             -              -              -              -                 -
buyback
Net Client          5,710          -              -             -              -              -              5,710             -
Flows
Income (loss)
and foreign        5,169        2,199        29          686          867          (63    )      1,451           -    
exchange
AUM - Ending        53,430         10,611         3,660         5,060          5,665          7,749          20,685            -
Balance
                                                                                                                          
Third-Party
Capital           $ 6,685       $ 691         $ 450        $ 993         $ 247         $ 4,304       $ -           $    -    
Raised
                                                                                                                          
Segment
Revenues
Management        $ 479          $ 120          $ 56          $ 77           $ 101          $ 98           $ 27           $    -
fee
Incentive          278          11           -           68           130          69           -               -    
income
Total               757            131            56            145            231            167            27                -
                                                                                                                          
Segment
Expenses
Operating         $ (336   )     $ (41    )     $ (26   )     $ (74    )     $ (63    )     $ (95    )     $ (37    )     $    -
expenses
Profit
sharing             (125   )       (4     )       -             (21    )       (63    )       (37    )       -                 -
compensation
expenses
Unallocated       $ 1           $ -           $ -          $ -           $ -           $ -           $ -           $    -    
Expenses
Total               (460   )       (45    )       (26   )       (95    )       (126   )       (132   )       (37    )          -
                                                                                                                   
Fund
Management DE
(before            297          86           30          50           105          35           (10    )         -    
Principal
Performance
Payments)
                                                                                                                          
Principal
Performance         (20    )       -              (1    )       (5     )       (13    )       (1     )       -                 -
Payments
                                                                                                                   
Fund               277          86           29          45           92           34           (10    )         -    
Management DE
                                                                                                                          
Investment          16                                                                                                         16
Income
Interest            (15    )                                                                                                   (15  )
Expense
                                                                                                                   
Pre-tax
Distributable     $ 278         $ 86          $ 29         $ 45          $ 92          $ 34          $ (10    )     $    1    
Earnings
                                                                                                                          
Pre-tax
Distributable
Earnings per      $ 0.52   
Dividend
Paying Share
                                                                                                                          

               
                  Full Year Ended December 31, 2011
                               Private Equity             Liquid       Credit Funds                             Principal
                                                              Hedge
(in millions)     Total          Funds        Castles       Funds          Hedge        PE Funds       Logan          Investments
                                                                             Funds                         Circle
Assets Under
Management
AUM - January     $ 44,613       $ 11,923       $ 3,037       $ 6,355        $ 6,773        $ 4,817        $ 11,708       $    -
1, 2011
Capital             1,817          -              -             1,318          309            190            -                 -
raised
Equity raised       220            -              220           -              -              -              -                 -
Increase in
invested            3,492          237            -             25             107            3,123          -                 -
capital
Redemptions         (1,853 )       -              -             (1,708 )       (145   )       -              -                 -
SPV                 -              -              -             -              -              -              -                 -
distribution
RCA
distributions       (1,222 )       -              -             -              (1,222 )       -              -                 -
^6
Return of
capital             (2,330 )       (317   )       (19   )       -              (140   )       (1,854 )       -                 -
distributions
Adjustment
for reset           (1,997 )       (1,997 )       -             -              -              -              -                 -
date
Crystallized
Incentive           (160   )       -              -             (69    )       (91    )       -              -                 -
Income
Equity              -              -              -             -              -              -              -                 -
buyback
Net Client          841            -              -             -              -              -              841               -
Flows
Income (loss)
and foreign        292          (561   )      (57   )      (406   )      385          (44    )      975             -    
exchange
transfers
AUM - Ending      $ 43,713       $ 9,285        $ 3,181       $ 5,515        $ 5,976        $ 6,232        $ 13,524       $    -
Balance
                                                                                                                          
Third-Party
Capital           $ 4,177       $ 51          $ 220        $ 1,318       $ 434         $ 2,154       $ -           $    -    
Raised
                                                                                                                          
Segment
Revenues
Management        $ 509          $ 132          $ 53          $ 109          $ 122          $ 73           $ 20           $    -
fees
Incentive          198          (2     )      -           4            78           118          -               -    
income
Total               707            130            53            113            200            191            20                -
                                                                                                                          
Segment
Expenses
Operating         $ (343   )     $ (38    )     $ (28   )     $ (78    )     $ (128   )     $ (34    )     $ (37    )     $    -
expenses
Profit
sharing            (111   )      1            -           (21    )      (35    )      (56    )      -               -    
compensation
expenses
Total               (454   )       (37    )       (28   )       (99    )       (163   )       (90    )       (37    )          -
                                                                                                                   
Fund               253          93           25          14           37           101          (17    )         -    
Management DE
                                                                                                                          
Investment          8                                                                                                          8
Income
Interest            (19    )                                                                                                   (19  )
Expense
                                                                                                             
Pre-tax
Distributable     $ 242         $ 93          $ 25         $ 14          $ 37          $ 101         $ (17    )     $    (11  )
Earnings
                                                                                                                          
Pre-tax
Distributable
Earnings per      $ 0.46   
Dividend
Paying Share
                                                                                                                          

____________________________

^6 Represents distributions from (i) assets held by redeeming capital accounts
in the Drawbridge Special Opportunities Funds, and (ii) the Value Recovery
Funds.

                                                                                                                          
Fortress Investment Group LLC

Exhibit 2-a

Assets Under Management and Fund Management DE

(dollars in millions)
                                                                                                                                      
                 Three Months Ended                                               Three Months Ended
Fortress         March 31,    June 30,     September    December     Full Year    March 31,    June 30,     September    December     Full Year
                                           30,          31,                                                 30,          31,
                  2011       2011       2011       2011       2011       2012       2012       2012       2012       2012   
                                                                                                                                      
Assets Under
Management
Private
Equity &         $ 13,244     $ 13,256     $ 12,708     $ 12,466     $ 12,466     $ 13,239     $ 13,826     $ 14,718     $ 14,271     $ 14,271
Castles
Liquid Hedge       6,303        6,321        6,165        5,515        5,515        4,840        4,398        4,378        5,060        5,060
Funds
Credit Hedge       6,545        6,374        6,214        5,976        5,976        6,011        5,859        5,663        5,665        5,665
Funds
Credit
Private            4,531        4,941        5,619        6,232        6,232        6,258        5,593        6,090        7,749        7,749
Equity Funds
Logan Circle      12,484     12,931     12,913     13,524     13,524     16,084     18,112     20,626     20,685     20,685 
AUM - Ending     $ 43,107    $ 43,823    $ 43,619    $ 43,713    $ 43,713    $ 46,432    $ 47,788    $ 51,475    $ 53,430    $ 53,430 
Balance
                                                                                                                                      
                                                                                                                                      
Third-Party
Capital          $ 649       $ 811       $ 899       $ 1,818     $ 4,177     $ 2,914     $ 1,103     $ 1,183     $ 1,485     $ 6,685  
Raised
                                                                                                                                      
Segment
Revenues
Management       $ 126        $ 131        $ 131        $ 121        $ 509        $ 118        $ 114        $ 116        $ 131        $ 479
fees
Incentive         118        20         14         46         198        52         47         65         114        278    
income
Total              244          151          145          167          707          170          161          181          245          757
                                                                                                                                      
Segment
Expenses
Operating          (93    )     (79    )     (83    )     (89    )     (344   )     (82    )     (81    )     (82    )     (91    )     (336   )
expenses
Profit
sharing            (58    )     (17    )     (11    )     (25    )     (111   )     (28    )     (24    )     (31    )     (42    )     (125   )
compensation
expenses
Unallocated                                                                                                                *Story
expenses          2          (1     )    -          -          1          -          -                      too
                                                                                                                           large*

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