S-4

                                                      REGISTRATION NO. 333-_____
================================================================================
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   ----------

                                    FORM S-4
                             REGISTRATION STATEMENT
                                     UNDER
                           THE SECURITIES ACT OF 1933

                                   ----------

                       EXTENDICARE HEALTH SERVICES, INC.*
             (Exact name of registrant as specified in its charter)

                                                            
          DELAWARE                            8051                       98-0066268
(State or other jurisdiction      (Primary Standard Industrial      (I.R.S. Employer
     of incorporation)             Classification Code Number)     Identification No.)



                            111 WEST MICHIGAN STREET
                           MILWAUKEE, WISCONSIN 53203
                                 (414) 908-8000
    (Address, including zip code, and telephone number, including area code,
                  of registrant's principal executive offices)

                                                             
                  MELVIN A. RHINELANDER                                    Copy to:
    CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER               RUSSELL E. RYBA, ESQ.
            EXTENDICARE HEALTH SERVICES, INC.                          FOLEY & LARDNER
                111 WEST MICHIGAN STREET                          777 EAST WISCONSIN AVENUE
               MILWAUKEE, WISCONSIN 53203                        MILWAUKEE, WISCONSIN 53202
                     (414) 908-8000                                    (414) 271-2400
(Name, address, including zip code, and telephone number,
     including area code, of agent for service)



        APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
          Upon consummation of the Exchange Offer referred to herein.

                                   ---------

     If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. [ ]

     If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]

     If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]

                                   ---------

                        CALCULATION OF REGISTRATION FEE



====================================================================================================================================
                                                               PROPOSED MAXIMUM         PROPOSED MAXIMUM
   TITLE OF EACH CLASS OF                    AMOUNT TO BE     OFFERING PRICE PER       AGGREGATE OFFERING        AMOUNT OF
SECURITIES TO BE REGISTERED                   REGISTERED           NOTE(1)                   PRICE           REGISTRATION FEE
- ------------------------------------------------------------------------------------------------------------------------------------
                                                                                                 
9 1/2% New Senior Notes due 2010(2)........  $150,000,000          100%                $150,000,000              $13,800
- ------------------------------------------------------------------------------------------------------------------------------------
Guarantees for the 9 1/2% New
  Senior Notes due 2010(3).................  $          0            0%                $          0              $     0
====================================================================================================================================



(1)  Estimated solely for purposes of determining the registration fee.
(2)  Calculated pursuant to Rule 457(f) under the Securities Act of 1933.
(3)  Pursuant to Rule 457(n) under the Securities Act of 1933, no registration
     fee is required with respect to the guarantees.

                                   ---------

     THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
================================================================================

                        *TABLE OF ADDITIONAL REGISTRANTS




                                                                            PRIMARY
                                                       STATE OR OTHER      STANDARD
                                                      JURISDICTION OF   INDUSTRIAL CODE         I.R.S. EMPLOYER
                                                      INCORPORATION OR  CLASSIFICATION          IDENTIFICATION
NAME, ADDRESS AND TELEPHONE NUMBER (1)                  ORGANIZATION        NUMBER                  NUMBER
- --------------------------------------                ----------------  ---------------         ----------------

                                                                                       
Adult Services Unlimited, Inc.                              PA               8051                 23-2284465
Alpine Health and Rehabilitation Center, LLC                FL               8051                 36-4321373
Arbors at Bayonet Point, LLC                                FL               8051                 36-4329444
Arbors at Fairlawn Care, LLC                                OH               8051                 36-4402146
Arbors at Fairlawn Realty OH, LLC                           OH               8051                 36-4321488
Arbors at Sylvania Care, LLC                                OH               8051                 36-4402158
Arbors at Sylvania Realty OH, LLC                           OH               8051                 36-4321462
Arbors at Tampa, LLC                                        FL               8051                 36-4329446
Arbors at Toledo, Inc.                                      OH               8051                 34-1645103
Arbors East, Inc.                                           OH               8051                 34-1677616
Arbors West Care, LLC                                       OH               8051                 36-4402159
Arbors West Realty OH, LLC                                  OH               8051                 36-4321454
Blanchester Care, LLC                                       OH               8051                 36-4321500
Canton Care, LLC                                            OH               8051                 36-4321498
Colonial Care, LLC                                          FL               8051                 39-1978966
Columbus Rehabilitation Care, LLC                           OH               8051                 36-4402162
Columbus Rehabilitation Realty OH, LLC                      OH               8051                 36-4321497
Concordia Manor, LLC                                        FL               8051                 36-4321452
Coventry Care Holdings, Inc.                                DE               8051                 39-1978947
Coventry Care, Inc.                                         PA               8051                 25-1212961
Dayton Care, LLC                                            OH               8051                 36-4321495
Delaware Care, LLC                                          OH               8051                 36-4321492
Edgewood Care, LP                                           DE               8051                 39-1978952
Edgewood Nursing Center, Inc.                               PA               8051                 25-1203766
Eldercrest Care, LP                                         DE               8051                 39-1978954
Elder Crest, Inc.                                           PA               8051                 25-1115979
Extendicare Great Trail, Inc.                               DE               8051                 39-1893202
Extendicare Health Facilities, Inc.                         WI               8051                 39-1045271
Extendicare Health Facility Holdings, Inc.                  WI               8051                 39-1441286
Extendicare Health Network, Inc.                            DE               8051                 39-1104974
Extendicare Homes, Inc.                                     DE               8051                 39-1441287
Extendicare of Indiana, Inc.                                DE               8051                 39-1792004
Fir Lane Terrace Convalescent Center, Inc.                  WA               8051                 91-1085334
First Coast Health and Rehabilitation Center, LLC           FL               8051                 36-4329440
Fiscal Services Group, LLC                                  DE               8051                 None
Gallipolis Care, LLC                                        OH               8051                 36-4321485
Great Trail Care, LLC                                       OH               8051                 36-4402165
Greenbriar Care, LLC                                        FL               8051                 39-1978964
Greenbrook Care, LLC                                        FL               8051                 39-1978961
Haven Care, LP                                              DE               8051                 39-1978957
Haven Crest, Inc.                                           PA               8051                 25-1102724
Health Poconos, Inc.                                        PA               8051                 23-2651850
Heritage Care, LLC                                          FL               8051                 39-1978989
Hilliard Care, LLC                                          OH               8051                 36-4321480



- ----------
(1) The address of each of these additional registrants is 111 West Michigan
    Street, Milwaukee, Wisconsin 53203. Their telephone number is
    (414) 908-8000.



                                                                           PRIMARY
                                                       STATE OR OTHER      STANDARD
                                                      JURISDICTION OF   INDUSTRIAL CODE         I.R.S. EMPLOYER
                                                      INCORPORATION OR  CLASSIFICATION          IDENTIFICATION
NAME, ADDRESS AND TELEPHONE NUMBER (1)                  ORGANIZATION        NUMBER                  NUMBER
- --------------------------------------                ----------------  ---------------         ----------------

                                                                                       
Indiana Health and Rehabilitation Centers                   IN               8051                  39-1792007
Jackson Heights Rehabilitation Center, LLC                  FL               8051                  36-4321425
Jacksonville Care, LLC                                      FL               8051                  36-4321383
Kaufman Street, WV, LLC                                     WI               8051                  36-4321388
Kissimmee Care, LLC                                         FL               8051                  36-4321390
Lady Lake Care, LLC                                         FL               8051                  39-1978988
London Care, LLC                                            OH               8051                  36-4321471
Marietta Care, LLC                                          OH               8051                  36-4321469
Marshall Properties, Inc.                                   OH               8051                  38-2583847
Meadow Care, LP                                             DE               8051                  39-1978958
Meadow Crest, Inc.                                          PA               8051                  25-1412967
Milford Care, LLC                                           OH               8051                  36-4402179
New Castle Care, LLC                                        DE               8051                  36-4321396
New Horizon Care, LLC                                       FL               8051                  39-1978984
North Rehabilitation Care, LLC                              FL               8051                  39-1978982
Northern Health Facilities, Inc.                            DE               8051                  39-1406172
Oak Hill Care, LP                                           DE               8051                  39-1978959
Oak Hill Home of Rest and Care, Inc.                        PA               8051                  25-1181655
Orange Park Care, LLC                                       FL               8051                  36-4321421
Oregon Care, LLC                                            OH               8051                  36-4402147
Palm Court Care, LLC                                        FL               8051                  39-1978970
Partners Health Group - Florida, LLC                        DE               8051                  None
Partners Health Group - Louisiana, LLC                      DE               8051                  None
Partners Health Group - Texas, LLC                          DE               8051                  None
Partners Health Group, LLC                                  DE               8051                  39-2013764
Port Charlotte Care, LLC                                    FL               8051                  36-4321416
Richey Manor, LLC                                           FL               8051                  36-4321430
Rockledge Care, LLC                                         FL               8051                  39-1978968
Rockmill Care, LLC                                          OH               8051                  36-4402142
Rocksprings Care, LLC                                       OH               8051                  36-4402136
Safety Harbor Care, LLC                                     FL               8051                  36-4321391
Sarasota Care, LLC                                          FL               8051                  36-4321370
Seminole Care, LLC                                          FL               8051                  36-4321380
South Heritage Health and Rehabilitation Center, LLC        FL               8051                  36-4321432
Stonebridge Care, LP                                        DE               8051                  39-1978949
The Oaks Residential and Rehabilitation Center, LLC         FL               8051                  36-4321428
The Progressive Step Corporation                            WI               8051                  39-1878099
Treasure Isle Care Center, LLC                              FL               8051                  36-4321449
United Professional Services, Inc.                          WI               8051                  39-1325589
Waterville Care, LLC                                        OH               8051                  36-4321460
Winter Haven Care, LLC                                      FL               8051                  36-4321378
Winter Haven Health and Rehabilitation Center, LLC          FL               8051                  36-4321792
Woodsfield Care, LLC                                        OH               8051                  36-4402135



- ----------
(1) The address of each of these additional registrants is 111 West Michigan
    Street, Milwaukee, Wisconsin 53203. Their telephone number is
    (414) 908-8000.




THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES
IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.

                   SUBJECT TO COMPLETION, DATED JULY 30, 2002

PROSPECTUS

                    [EXTENDICARE HEALTH SERVICES, INC. LOGO]
                               Offer to Exchange
                                All Outstanding
                          9 1/2% Senior Notes due 2010
                    $150,000,000 Aggregate Principal Amount
                                      for
                        New 9 1/2% Senior Notes due 2010
                    $150,000,000 Aggregate Principal Amount
- --------------------------------------------------------------------------------
- - We are offering to exchange new registered 9 1/2% Senior Notes due 2010 for
  all of our outstanding unregistered 9 1/2% Senior Notes due 2010.

- - The exchange offer expires at 5:00 p.m., New York City time, on           ,
  2002, unless we extend it.

- - The terms of the new notes to be issued are substantially identical to those
  of the old notes, except that the new notes will not have securities law
  transfer restrictions and registration rights relating to the old notes and
  the new notes will not provide for the payment of liquidated damages under
  circumstances relating to the timing of the exchange offer.

- - All of our existing and future domestic significant subsidiaries, all of our
  existing and future domestic subsidiaries that guarantee or incur any
  indebtedness and any other existing or future significant subsidiaries or
  restricted subsidiaries that guarantee or otherwise provide direct credit
  support for indebtedness of ours or any of our domestic subsidiaries will
  fully and unconditionally guarantee the new notes.

- - All outstanding old notes that are validly tendered and not validly withdrawn
  will be exchanged.

- - No established trading market for the new notes currently exits. We do not
  intend to apply for the new notes to be listed on any securities exchange or
  to arrange for any automated quotation system to quote them.

- - You may withdraw your tender of old notes any time before the exchange offer
  expires.

- - Neither we nor any subsidiary guarantor will receive any proceeds from the
  exchange offer.

- - The exchange of notes will not be a taxable event for U.S. federal income tax
  purposes.

See "Risk Factors" beginning on page 14 for a discussion of risk factors that
you should consider before deciding to exchange your old notes for new notes.

Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
- --------------------------------------------------------------------------------
               The date of this prospectus is             , 2002.


                               TABLE OF CONTENTS



                                                                PAGE
                                                                ----
                                                             
Prospectus Summary..........................................      1
Risk Factors................................................     14
The Exchange Offer..........................................     22
Use of Proceeds.............................................     31
Capitalization..............................................     32
Selected Consolidated Historical Financial Data.............     33
Management's Discussion and Analysis of Financial Condition
  and Results of Operations.................................     34
Business....................................................     51
Management..................................................     65
Certain Relationships and Related Party Transactions........     67
Description of Other Indebtedness...........................     68
Description of the New Notes................................     72
Certain U.S. Federal Income Tax Considerations..............    107
Plan of Distribution........................................    108
Legal Matters...............................................    108
Experts.....................................................    108
Where You Can Find More Information.........................    108
Index to Consolidated Financial Statements..................    F-1


                          ----------------------------

     In this prospectus, "we," "us" and "our" and "EHSI" refer to Extendicare
Health Services, Inc. and its subsidiaries on a combined basis, unless the
context indicates otherwise.

     You should rely only on the information provided in this prospectus. We
have not authorized anyone to provide you with any different information. The
information in this prospectus is current only as of the date on the cover, and
our business or financial condition and other information in this prospectus may
change after that date.

                   SPECIAL NOTE ON FORWARD-LOOKING STATEMENTS

     This prospectus contains forward-looking statements that are intended to
qualify for the safe harbors from liability established by the Private
Securities Litigation Reform Act of 1995. All statements other than statements
of historical fact, including statements regarding anticipated financial
performance, business strategy and management's plans and objectives for future
operations, are forward-looking statements. These forward-looking statements can
be identified as such because the statements generally include words such as
"expect," "intend," "believe," "anticipate," "estimate," "plan" or "objective"
or other similar expressions. These forward-looking statements are subject to
risks and uncertainties that could cause actual results to differ materially
from those expressed in, or implied by, these statements. Some, but not all, of
the risks and uncertainties include those described in the "Risk Factors"
section of this prospectus beginning on page 14 and the following:

     - Medicare and Medicaid reimbursement policies;

     - resident care litigation, including exposure for punitive damage claims
       and increased insurance costs, which among other things caused us to exit
       the Florida and Texas markets;

     - the shortage of, and the related costs of hiring and retraining,
       qualified staff and employees;

                                        i


     - federal and state regulations of our business;

     - actions of our competitors; and

     - fee pressures and slow payment practices by health maintenance
       organizations and preferred provider organizations.

     We will only update publicly any forward-looking statements contained in
this prospectus, whether as a result of new information, future events or
otherwise, to the extent required by law.

                                        ii


                               PROSPECTUS SUMMARY

     This prospectus summary may not contain all of the information that may be
important to you. This prospectus includes the specific terms of the new notes
we are offering, as well as information regarding our business. We encourage you
to read this prospectus in its entirety.

                       EXTENDICARE HEALTH SERVICES, INC.

     We are one of the largest providers of long-term care and related services
in the United States. Through our network of geographically clustered
facilities, we offer a continuum of healthcare services, including skilled
nursing care, assisted living and related medical specialty services, such as
subacute care and rehabilitative therapy. As of March 31, 2002, we operated or
managed 198 long-term care facilities with 18,328 beds in 15 states, of which
157 were skilled nursing facilities with 16,416 beds and 41 were assisted living
and retirement facilities with 1,912 units. In addition, we operated 21
outpatient rehabilitation clinics in four states. We also provided consulting
services to 34 facilities with 3,195 beds in two states. We receive payment for
our services from Medicare, Medicaid, private insurance, self pay residents and
other third party payors. For the twelve month period ended March 31, 2002, we
generated adjusted revenue from continuing operations of $770.3 million and
$83.4 million of Adjusted EBITDA, as defined in "Summary Consolidated Historical
Financial and Operating Data."

     We focus on our core skilled nursing facility operations, while continuing
to grow our complementary long-term care services. By emphasizing quality care
of patients and by clustering several long-term care facilities together within
the geographic areas we serve, we hope to build upon our reputation as a leading
provider of a full range of long-term care services in our communities and, as a
result, to continue to improve our Medicare census and occupancy rate. For the
three months ended March 31, 2002, our average occupancy rate was 89.5% in our
skilled nursing facilities and 81.8% in our assisted living facilities.

                          THE LONG-TERM CARE INDUSTRY

     According to the Health Care Industry Market Update report issued in
February 2002 by the Centers for Medicare and Medicaid Services (formerly the
Health Care Financing Administration), long-term care spending relating to
nursing facilities was estimated at approximately $92.2 billion in 2000. The
aging of the U.S. population is a leading driver of demand for long-term care
services. According to the U.S. Census Bureau, there are approximately 35
million Americans aged 65 or older, representing 13% of the total U.S.
population. The Centers for Medicare and Medicaid Services have projected the
annual growth rate through 2020 for persons over 65 will be 1.8%, and 2.6% for
persons over 85. In 2000, approximately 2.1 million or 5.9% of all persons aged
65 and over were living in a nursing facility, up from 5.0% in 1990. The
long-term care industry is fragmented, with the 10 largest nursing facility
companies accounting for 18.5% of the total facility beds.

     As the number of people over age 65 continues to grow and as advances in
medical technology continue to increase life expectancies, healthcare costs are
expected to rise faster than the availability of resources from
government-sponsored healthcare programs. In response to these rising costs,
governmental and private pay sources in the United States have adopted cost
containment measures that encourage reduced lengths of stay in acute care
hospitals. As a result, an increasing number of patients require a high degree
of monitoring, intensive and specialized medical care, 24-hour per day nursing
services and a comprehensive array of rehabilitative therapies. This trend has
increased the demand for these services from long-term care, home healthcare,
outpatient facilities, hospices and assisted living facilities to provide some
or all of these services in place of acute care hospitals. Long-term care
companies with information systems to process clinical and financial data and
that provide a broad range of healthcare services are in a more competitive
position than traditional acute care and rehabilitation hospitals to contract
with managed care companies and other payors to provide a continuum of services
to the elderly population.

                                        1


                             COMPETITIVE STRENGTHS

     Leading Provider of Long-Term Care Services. We are among the largest
providers of long-term care services in the United States. As of March 31, 2002,
we owned, leased or managed 198 long-term care facilities with 18,328 beds. Our
scope of operations allows us to achieve economies of scale in purchasing and
contracting with suppliers and customers. For example, through one of our
subsidiaries, we purchase for nursing facilities in numerous states in addition
to the facilities we operate or manage. Through our affiliate, Virtual Care
Provider, Inc., we also provide technology support services to unaffiliated
long-term care facilities.

     Significant Facility Ownership. We own rather than lease a majority of our
properties, unlike a number of other long-term care providers. As of March 31,
2002, we owned 157 facilities and had the option to purchase an additional seven
facilities, or a combined 93.7% of the total number of facilities we operated.
We believe that owning properties increases our operating flexibility by
allowing us to:

     - refurbish facilities to meet changing consumer demands;

     - add assisted living and retirement facilities adjacent to our skilled
       nursing facilities;

     - divest facilities and exit markets at our discretion; and

     - more directly control our occupancy costs.

     Focus on Core Business. Over the past four years, we have successfully
identified and disposed of business segments that did not fit within our core
business and facilities located in states with unacceptable litigation risks.
These dispositions included the 1998 sale of our institutional pharmacy
operation, the 1999 and 2000 sale or lease of all of our facilities in Florida
and the 2001 lease or sublease of all our skilled nursing operations in Texas.
We intend to continue to focus on owning and managing long-term care facilities.
In addition, we will continue to review the performance of our current
facilities and exit markets or sell facilities that do not meet our performance
goals.

     Dual Medicare and Medicaid Certification. We have certified substantially
all of our beds for the provision of care to both Medicare and Medicaid
patients. We believe that dual certification increases the likelihood of higher
occupancy rates by increasing the availability of beds to patients who require a
specific bed certification. In addition, dual certification allows our
facilities to easily shift patients from one level of care and reimbursement to
another without physically moving the patient.

     Management Focus on Key Performance Drivers. We believe that our senior
management, as well as our field personnel, are proficient at focusing on the
key areas that drive revenues, profits and cash flows. Our senior management has
identified three critical drivers of operating and financial performance:

     - improving census, particularly increasing our Medicare census;

     - expediting billing and collections; and

     - controlling labor costs.

     Every level of management, starting with our chief executive officer,
devotes a significant portion of its time to improving these drivers. We believe
that this attention has resulted in substantial improvement in several of our
key operating metrics.

     For the three month period ended March 31, 2002, the occupancy rate for our
skilled nursing facilities was 89.5%, or 2.4 percentage points higher than the
87.1% occupancy rate for the three month period ended March 31, 2001. For the
three month period ended March 31, 2002, our Medicare revenues were 25.5% of
total revenues, or 2.1 percentage points higher than our Medicare revenues
percentage for the three month period ended March 31, 2001, which was 23.4%.

     Through consistent emphasis on admissions protocols, attention to older and
larger account balances and proactive collection efforts at regional and head
offices, we have improved our accounts receivable

                                        2


management. Days of revenues outstanding have dropped from approximately 59 days
in 1998 to 46 days as of March 31, 2002.

     We have employed a variety of strategies to control labor costs and
minimize the use of temporary staff. Our strategies include adjusting wage
scales, offering greater flexibility in staffing and improving overall job
satisfaction. Regular wages as a percent of revenues have declined to 45.7% in
the three months ended March 31, 2002 from 46.8% in the three months ended March
31, 2001, while temporary wages as a percent of revenues in the same periods
decreased to 1.6% from 2.6%.

     Geographic Diversity. We operate or manage facilities located in specific
markets across 15 states throughout the Northeast, Midwest, South and Northwest
regions of the United States. No state contains more than 18% of our facilities
or 20% of our beds or generates more than 21% of our Adjusted EBITDA. Each state
is unique in terms of its competitive dynamics as well as political and
regulatory environment. Each state administers its own Medicaid program, which
constitutes a significant portion of our revenue. Our diversified market scope
limits our exposure to events or trends that may occur in any individual state,
including changes in any state's Medicaid reimbursement program and in regional
and local economic conditions and demographics.

     Experienced and Proven Management Team. Our management has demonstrated
competency in dealing with major changes in the reimbursement environment
resulting from the shift to the prospective payment system. In addition,
management determined that the best way to address the extremely litigious
environments in Florida and Texas was to cease operating in those markets.
During these challenging times, we have retained substantially all of our
executive and operating management team.

                               BUSINESS STRATEGY

     The principal elements of our business strategy are to:

     Provide Quality, Clinically Based Services. We engage in outcomes
management, forecasting and continuous quality improvement processes at the
facility, regional and corporate level. In recognition of increased state
regulatory oversight, we have an internal team of field-based quality validation
specialists who are responsible for mirroring the regulatory survey process and
regularly communicating with our outcomes management specialists in our
corporate office. On-site data is integrated with clinical indicators, facility
human resource data and state regulatory outcomes to provide a detailed picture
of problems, challenges and successes in achieving performance at all levels of
our organization. This information pool allows us to determine best practices
for duplication in similarly situated facilities. We emphasize these programs
when marketing our services to acute care providers, community organizations and
physicians in the communities we serve.

     Increase Medicare Census. We continue to develop and implement strategies
and capabilities to attract residents, with a focus on increasing Medicare
census. As of March 31, 2002, Medicare payments represented approximately 26% of
our total net revenues, up from 22% in 1999. Senior management has worked with
our regional and local management teams to develop strategies to continue to
increase this percentage. Strategies such as focused marketing efforts,
standardized admissions protocols, streamlined admitting procedures, the dual
certification of beds and improved management communication have driven this
improvement. In addition to increasing our facilities' profitability, the
increased Medicare census expands the market for our service related businesses
as Medicare patients utilize significant ancillary services.

     Leverage Presence in Small Urban Markets. We geographically cluster our
long-term care facilities and services in small urban markets in order to
improve operating efficiencies and to offer our customers a broad range of
long-term care and related health services, including assisted living
facilities. Future expansion of our owned nursing facility operations is
anticipated to be through the selective acquisition and construction of new
facilities in areas that are in close proximity to existing facilities, where
management is experienced in dealing with the regulatory and reimbursement
environments, where the facility can

                                        3


participate as an active member of the nursing facility association and where
the facility's reputation is established.

     Expand Management and Consulting Services. We seek to increase the number
of management and consulting contracts with third party operators. We have
knowledge and expertise in both the operational and administrative aspects of
the long-term care sector. We believe that the increasingly complex and
administratively burdensome nature of the long-term care sector, coupled with
our commitment and reputation as a leading, high-quality operator, will drive
demand for new contracts. We believe this strategy is a logical extension of our
business model and competencies and will drive growth without requiring
substantial capital expenditures.

     Increase Operating Efficiency. We are focused on reducing operating costs
by improving our communications systems, streamlining documentation and
strengthening the formalization of procedures to approve expenditures. We are
reducing duplication of roles at the corporate and regional levels. We continue
to seek to improve our utilization of regional resources by adding management
and consulting contracts to our existing regions, thereby enabling us to spread
the semi-fixed costs of our regional structure over a wider base of facilities.

     Proactively Manage Our Asset Portfolio. While we have made significant
progress over the last several years in disposing of non-core and
under-performing assets, we will continue to review our asset portfolio and exit
markets or sell facilities which do not meet our performance goals.

                              NEW CREDIT FACILITY

     In connection with the issuance of the old notes, we refinanced all of our
outstanding indebtedness under our then-existing credit facility with the
proceeds of that issuance, and we entered into a new credit facility that
provides senior secured financing of up to $105.0 million on a revolving basis.
As of July 15, 2002, we did not have any borrowings outstanding under this new
credit facility, but we did replace $40.1 million of letters of credit under the
old credit facility with new letters of credit under the new credit facility.
Each of the subsidiary guarantees of the old notes and the new notes guaranteed
the new credit facility on a senior basis.

                              RECENT DEVELOPMENTS

     Sale to Tandem Health Care, Inc. On May 31, 2002, Tandem and its affiliates
purchased seven skilled nursing facilities in Florida that they had leased from
us prior to that date. As a result of the transaction, we received total
proceeds of $28.6 million.

     Purchase of Ohio and Indiana Facilities. We are currently negotiating the
purchase of three skilled nursing facilities in Ohio and four assisted living
facilities in Indiana that we currently lease. We currently anticipate that the
transaction will close in August 2002 and will have an aggregate purchase price
of approximately $17.5 million.
                          ----------------------------

     We are an indirect wholly owned subsidiary of Extendicare Inc., a Canadian
publicly traded company. Our principal executive offices are located at 111 West
Michigan Street, Milwaukee, Wisconsin 53203. Our telephone number is (414)
908-8000.

                                        4


                               THE EXCHANGE OFFER

OLD NOTES.....................   On June 20, 2002, we sold to the initial
                                 purchasers $150,000,000 aggregate principal
                                 amount of our 9 1/2% Senior Notes due 2010,
                                 which are fully and unconditionally guaranteed
                                 by:

                                 - all of our existing and future domestic
                                   significant subsidiaries;

                                 - all of our existing and future domestic
                                   subsidiaries that guarantee or incur any
                                   indebtedness; and

                                 - any other existing or future significant
                                   subsidiaries or restricted subsidiaries that
                                   guarantee or otherwise provide direct credit
                                   support for indebtedness of ours or any of
                                   our domestic subsidiaries.

                                 In this prospectus we refer to those senior
                                 notes as the old notes. We issued the old notes
                                 at a discount of 0.25% per old note, which
                                 means the initial purchasers paid less than the
                                 principal amount for the old notes. The initial
                                 purchasers resold those old notes to qualified
                                 institutional buyers pursuant to Rule 144A
                                 under the Securities Act of 1933 and outside
                                 the United States to persons other than United
                                 States persons in offshore transactions meeting
                                 the requirements of Regulation S under the
                                 Securities Act.

REGISTRATION RIGHTS
AGREEMENT.....................   When we sold the old notes we entered into a
                                 registration rights agreement with the initial
                                 purchasers in which we agreed, among other
                                 things, to provide to you and all other holders
                                 of these old notes the opportunity to exchange
                                 your unregistered old notes for substantially
                                 identical new notes that we have registered
                                 under the Securities Act. This exchange offer
                                 is being made for that purpose.

NEW NOTES.....................   We are offering to exchange the old notes for
                                 9 1/2% Senior Notes due 2010 that have been
                                 registered under the Securities Act, which are
                                 fully and unconditionally guaranteed by:

                                 - all of our existing and future domestic
                                   significant subsidiaries;

                                 - all of our existing and future domestic
                                   subsidiaries that guarantee or incur any
                                   indebtedness; and

                                 - any other existing or future significant
                                   subsidiaries or restricted subsidiaries that
                                   guarantee or otherwise provide direct credit
                                   support for indebtedness of ours or any of
                                   our domestic subsidiaries.

                                 In this prospectus we refer to those registered
                                 senior notes as the new notes. In this
                                 prospectus we may refer to the old notes and
                                 the new notes collectively as the notes. The
                                 terms of the new notes and the old notes are
                                 substantially identical except:

                                 - the new notes will be issued in a transaction
                                   that will have been registered under the
                                   Securities Act;

                                 - the new notes will not contain securities law
                                   restrictions on transfer, and

                                        5


                                 - the new notes will not provide for the
                                   payment of liquidated damages under
                                   circumstances relating to the timing of the
                                   exchange offer.

THE EXCHANGE OFFER............   We are offering to exchange $1,000 principal
                                 amount of the new notes for each $1,000
                                 principal amount of your old notes. As of the
                                 date of this prospectus, $150,000,000 aggregate
                                 principal amount of the old notes are
                                 outstanding. For procedures for tendering, see
                                 "The Exchange Offer -- Procedures for Tendering
                                 Old Notes."

EXPIRATION DATE...............   This exchange offer will expire at 5:00 p.m.,
                                 New York City time, on           , 2002, unless
                                 we extend it.

RESALES OF NEW NOTES..........   We believe that the new notes issued pursuant
                                 to the exchange offer in exchange for old notes
                                 may be offered for resale, resold and otherwise
                                 transferred by you without compliance with the
                                 registration and prospectus delivery provisions
                                 of the Securities Act if:

                                 - you are not our "affiliate" within the
                                   meaning of Rule 405 under the Securities Act;

                                 - you are acquiring the new notes in the
                                   ordinary course of your business; and

                                 - you have not engaged in, do not intend to
                                   engage in, and have no arrangement or
                                   understanding with any person to participate
                                   in, a distribution of the new notes.

                                 If you are an affiliate of ours, or are
                                 engaging in or intend to engage in, or have any
                                 arrangement or understanding with any person to
                                 participate in, a distribution of the new
                                 notes, then:

                                 - you will not be permitted to tender old notes
                                   in the exchange offer; and

                                 - you must comply with the registration and
                                   prospectus delivery requirements of the
                                   Securities Act in connection with any resale
                                   of the old notes.

                                 Each participating broker-dealer that receives
                                 new notes for its own account under the
                                 exchange offer in exchange for old notes that
                                 were acquired by the broker-dealer as a result
                                 of market-making or other trading activity must
                                 acknowledge that it will deliver a prospectus
                                 in connection with any resale of the new notes.
                                 See "Plan of Distribution."

ACCEPTANCE OF OLD NOTES AND
DELIVERY
OF NEW NOTES..................   We will accept for exchange any and all old
                                 notes that are validly tendered in the exchange
                                 offer and not withdrawn before the offer
                                 expires. The new notes will be delivered
                                 promptly following the exchange offer.

WITHDRAWAL RIGHTS.............   You may withdraw your tender of old notes at
                                 any time before the exchange offer expires.

CONDITIONS OF THE EXCHANGE
OFFER.........................   The exchange offer is subject to certain
                                 customary conditions, which we may waive.
                                 Please see "The Exchange Offer --

                                        6


                                 Conditions to the Exchange Offer" for more
                                 information regarding the conditions to the
                                 exchange offer.

CONSEQUENCES OF FAILURE TO
EXCHANGE
OLD NOTES.....................   If you are eligible to participate in the
                                 exchange offer and you do not tender your old
                                 notes, then you will continue to hold your old
                                 notes and you will be subject to all the
                                 limitations and restrictions on transfer
                                 applicable to such old notes. Generally,
                                 untendered old notes will remain restricted
                                 securities and may not be offered or sold,
                                 unless registered under the Securities Act,
                                 except pursuant to an exemption from, or in a
                                 transaction not subject to, the Securities Act
                                 and applicable state securities laws. Other
                                 than in connection with the exchange offer, we
                                 do not currently anticipate that we will
                                 register the old notes under the Securities
                                 Act. The trading market for the old notes could
                                 be adversely affected if some but not all of
                                 the old notes are tendered and accepted in the
                                 exchange offer.

FEDERAL INCOME TAX
CONSEQUENCES..................   The exchange of an old note for a new note in
                                 the exchange offer will not be a taxable event
                                 for United States federal income tax purposes.
                                 Consequently, you will not recognize any gain
                                 or loss upon receipt of the new notes. See
                                 "Certain U.S. Federal Income Tax
                                 Considerations" for a more detailed description
                                 of the tax consequences of the exchange.

USE OF PROCEEDS...............   Neither we nor any subsidiary guarantor will
                                 receive any proceeds from the issuance of new
                                 notes pursuant to the exchange offer.

ACCOUNTING TREATMENT..........   We will not recognize any gain or loss on the
                                 exchange of old notes for new notes. See "The
                                 Exchange Offer -- Accounting Treatment."

EXCHANGE AGENT................   U.S. Bank, N.A. is the exchange agent. See "The
                                 Exchange Offer -- Exchange Agent."

                                        7


                                 THE NEW NOTES

     The new notes will evidence the same debt as the old notes and will be
governed by the same indenture under which the old notes were issued. The
summary below describes the principal terms of the new notes. The "Description
of the New Notes" section of this prospectus contains a more detailed
description of the terms and conditions of the new notes.

ISSUER........................   Extendicare Health Services, Inc.

NOTES OFFERED.................   $150,000,000 in aggregate principal amount of
                                 9 1/2% Senior Notes due 2010.

GUARANTEES....................   All payments, including principal and interest,
                                 with respect to the old notes are and the new
                                 notes will be, fully and unconditionally
                                 guaranteed on a senior unsecured basis, jointly
                                 and severally, by:

                                 - all of our existing and future domestic
                                   significant subsidiaries;

                                 - all of our existing and future domestic
                                   subsidiaries that guarantee or incur any
                                   indebtedness; and

                                 - any other existing or future significant
                                   subsidiaries or restricted subsidiaries that
                                   guarantee or otherwise provide direct credit
                                   support for indebtedness of ours or any of
                                   our domestic subsidiaries.

                                 The old notes and guarantees are, and the new
                                 notes and guarantees will be, our and our
                                 subsidiary guarantors' general unsecured
                                 obligations.

MATURITY DATE.................   July 1, 2010.

INTEREST PAYMENT DATES........   January 1 and July 1, commencing January 1,
                                 2003.

RANKING.......................   The old notes and guarantees are, and the new
                                 notes and guarantees will be, unsecured and:

                                 - equal in right of payment to all of our and
                                   our subsidiary guarantors' existing and
                                   future unsecured senior indebtedness;

                                 - senior in right of payment to all of our and
                                   our subsidiary guarantors' existing and
                                   future subordinated indebtedness;

                                 - effectively subordinated in right of payment
                                   to all existing and future indebtedness and
                                   other liabilities of any of our existing or
                                   future non-guarantor subsidiaries; and

                                 - effectively subordinated in right of payment
                                   to all of our and our subsidiary guarantors'
                                   secured indebtedness to the extent of the
                                   value of the assets securing that
                                   indebtedness, which will consist primarily of
                                   existing secured indebtedness of $37.5
                                   million as of March 31, 2002.

OPTIONAL REDEMPTION...........   On or after July 1, 2006, we may redeem all or
                                 part of the notes, at the redemption prices
                                 (expressed as percentages of principal amount)
                                 listed below, plus accrued and unpaid interest,
                                 if any, to

                                        8


                                 the date of redemption, if redeemed during the
                                 12-month period commencing on July 1 of the
                                 years set forth below:



                                                                                              REDEMPTION
                                                                 YEAR                           PRICE
                                                                 ----                         ----------
                                                                                           
                                             2006.........................................     104.750%
                                             2007.........................................     102.375%
                                             2008 and thereafter..........................     100.000%


                                 Before July 1, 2005, we may redeem up to 35% of
                                 the aggregate principal amount of outstanding
                                 notes issued under the indenture with the net
                                 cash proceeds of qualified equity offerings.

CHANGE OF CONTROL.............   Upon specified change of control events, unless
                                 we have exercised our option to redeem all of
                                 the notes as described above, each holder of a
                                 note will have the right to require us to
                                 repurchase all or a portion of its notes at a
                                 purchase price in cash equal to 101% of the
                                 principal amount, plus accrued and unpaid
                                 interest, if any, to the date of repurchase.

COVENANTS.....................   The indenture governing the notes limits our
                                 ability and the ability of our subsidiary
                                 guarantors to, among other things:

                                 - incur additional indebtedness;

                                 - create liens;

                                 - pay dividends on or redeem capital stock;

                                 - make certain investments;

                                 - make restricted payments;

                                 - make certain dispositions of assets;

                                 - engage in certain transactions with
                                   affiliates;

                                 - engage in certain business activities; and

                                 - engage in mergers, consolidations and certain
                                   sales of assets.

                                 The indenture governing the notes also limits
                                 our ability to permit restrictions on the
                                 ability of some of our subsidiaries to pay
                                 dividends or make certain other distributions.

                                 These covenants are subject to important
                                 exceptions and qualifications, as described
                                 under "Description of the New Notes."

                                        9


ABSENCE OF ESTABLISHED MARKET
FOR THE
NOTES.........................   The notes are a new issue of securities, and
                                 there is currently no market for them. We do
                                 not intend to apply for the notes to be listed
                                 on any securities exchange or to arrange for
                                 any quotation system to quote them. The notes
                                 have been designated for trading on the PORTAL
                                 Market(SM). The initial purchasers of the old
                                 notes have advised us that they intend to make
                                 a market for the notes, but they are not
                                 obligated to do so. The initial purchasers may
                                 discontinue any market making in the notes at
                                 any time in their sole discretion. Accordingly,
                                 we cannot assure you that a liquid market will
                                 develop or continue for the notes.

     For a discussion of certain risks that you should consider before deciding
to exchange your old notes for new notes, see "Risk Factors."

                                        10


                        SUMMARY CONSOLIDATED HISTORICAL
                          FINANCIAL AND OPERATING DATA

     The following table summarizes our consolidated historical financial and
operating data (including adjusted historical data, as noted). You should read
this table in conjunction with "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and our consolidated financial
statements and related notes. The summary consolidated financial data as of
December 31, 2001, 2000 and 1999 and for each of the years in the three-year
period ended December 31, 2001 have been derived from our audited consolidated
financial statements included elsewhere in this prospectus. The summary
consolidated financial data as of March 31, 2002 and for the three month periods
ended March 31, 2002 and 2001 have been derived from our unaudited consolidated
quarterly financial statements included elsewhere in this prospectus, and the
summary financial data as of March 31, 2001 have been derived from our unaudited
consolidated quarterly financial statements, all of which, in our opinion,
reflect all adjustments necessary to present fairly the data for such periods.
The summary financial data for the twelve months ended March 31, 2002 have been
derived from our audited consolidated financial statements for the year ended
December 31, 2001 and our unaudited consolidated quarterly financial statements,
all of which are included elsewhere in this prospectus. Interim results for the
three months ended March 31, 2002 are not necessarily indicative of results that
can be expected in future periods. "Operating Data" below are not directly
derived from our financial statements, but have been presented to provide
additional data for your analysis. Twelve months ended March 31, 2002 means the
twelve-month period beginning April 1, 2001 and ending March 31, 2002.



                                            TWELVE
                                            MONTHS       THREE MONTHS ENDED
                                             ENDED           MARCH 31,               YEAR ENDED DECEMBER 31,
                                           MARCH 31,    --------------------    ---------------------------------
                                             2002         2002        2001        2001        2000        1999
                                           ---------    --------    --------    --------    --------    ---------
                                                                   (DOLLARS IN THOUSANDS)
                                                                                      
INCOME STATEMENT DATA:
Revenues:
  Nursing and assisted living
    facilities.........................    $771,394     $190,998    $186,556    $766,952    $904,847    $ 916,195
  Outpatient therapy and medical
    supplies...........................       9,645        2,452       2,322       9,515       9,716       43,068
  Other................................      17,877        4,791       4,554      17,640       8,506        8,322
                                           --------     --------    --------    --------    --------    ---------
    Total revenues.....................     798,916      198,241     193,432     794,107     923,069      967,585
Costs and expenses:
  Operating............................     681,354      166,604     170,064     684,814     825,172      844,391
  General and administrative...........      32,174        8,211       8,424      32,387      46,507       45,524
  Lease costs..........................      13,792        3,034       3,817      14,575      15,731       16,631
  Depreciation and amortization........      39,908        9,434      10,298      40,772      45,434       52,005
  Interest, net........................      33,698        7,988       9,850      35,560      45,155       51,267
  Loss on impairment of long-lived
    assets.............................       1,685           --          --       1,685      20,753       38,173
  Loss on disposal of assets and other
    items..............................      22,837           --       1,409      24,246       6,663       42,774
                                           --------     --------    --------    --------    --------    ---------
(Loss) earnings before income taxes,
  minority interests and extraordinary
  item.................................     (26,532)       2,970     (10,430)    (39,932)    (82,346)    (123,180)
Net (loss) earnings....................    $(19,087)    $  1,657    $ (6,751)   $(27,495)   $(55,121)   $ (70,457)
                                           ========     ========    ========    ========    ========    =========
OTHER FINANCIAL DATA:
Property and equipment capital
  expenditures.........................    $ 16,549     $  3,130    $  2,929    $ 16,348    $ 14,169    $  25,330
Net cash provided by operating
  activities...........................      66,259       10,388      20,056      75,927      32,842       18,643
EBITDA(1)(2)...........................      71,596       20,392      11,127      62,331      35,659       61,039
Adjusted EBITDA(1)(2)..................      83,390       20,840      11,460      74,010      72,563       66,224
Adjusted EBITDA margin(1)..............       10.8%        10.5%        6.3%        9.8%       10.0%         9.9%
EBITDAR(1)(2)..........................      85,388       23,426      14,944      76,906      51,390       77,670
Adjusted EBITDAR(1)(2).................      95,390       23,426      14,829      86,792      86,501       81,064
Adjusted EBITDAR margin(1).............       12.4%        11.8%        8.2%       11.5%       11.9%        12.1%
Days of Revenues Outstanding...........          46           45          49          48          52           56


                                        11




                                            TWELVE
                                            MONTHS       THREE MONTHS ENDED
                                             ENDED           MARCH 31,               YEAR ENDED DECEMBER 31,
                                           MARCH 31,    --------------------    ---------------------------------
                                             2002         2002        2001        2001        2000        1999
                                           ---------    --------    --------    --------    --------    ---------
                                                                   (DOLLARS IN THOUSANDS)
                                                                                      
SELECTED PRO FORMA RATIOS(3):
Adjusted EBITDA/Interest...............        2.15x
Senior debt/Adjusted EBITDA............        2.26x
Total debt/Adjusted EBITDA.............        4.66x
Total adjusted debt/Adjusted EBITDAR...        5.08x

RATIO OF EARNINGS TO FIXED
  CHARGES(4)...........................        0.37x        1.31x       0.13x       0.10x      (0.54)x      (1.05)x

BALANCE SHEET DATA (END OF PERIOD):
Cash and cash equivalents..............    $  2,993     $  2,993    $  1,462    $    997    $  1,641    $   2,941
Working capital........................         538          538      23,197       4,145      44,473       67,807
Property and equipment.................     471,586      471,586     501,733     477,830     507,536      610,343
Total assets...........................     785,725      785,725     841,051     795,836     873,590      974,448
Total debt(5)..........................     372,524      372,524     432,184     385,347     451,147      530,155
Shareholder's equity...................     157,637      157,637     176,466     156,002     184,161      237,895

OPERATING DATA:
Number of facilities at end of
  period(6)
  Nursing-owned........................         122          122         126         122         126          154
  Nursing-leased.......................          17           17          30          17          29           32
  Nursing-managed......................          18           18          17          18          16            6
  Nursing-consulting...................          34           34          12          35          12           --
                                           --------     --------    --------    --------    --------    ---------
    Total nursing......................         191          191         185         192         183          192
                                           ========     ========    ========    ========    ========    =========
  Assisted living and
    retirement-owned...................          35           35          35          35          35           39
  Assisted living and
    retirement-leased..................           1            1           1           1           1            1
  Assisted living and
    retirement-managed.................           5            5           5           5           5            5
                                           --------     --------    --------    --------    --------    ---------
    Total assisted-living and
      retirement.......................          41           41          41          41          41           45
                                           ========     ========    ========    ========    ========    =========
  Rehabilitation
    centers-owned/leased...............          21           21          21          20          20           28
Resident capacity at end of period(6)
  Nursing (beds).......................      19,611       19,611      19,099      19,759      18,753       20,143
  Assisted living and retirement
    (units)............................       1,912        1,912       1,919       1,912       1,925        1,912
Average occupancy rate(7)
  Nursing..............................         88%          90%         87%         88%         88%          86%
  Assisted living and retirement.......         83%          82%         84%         83%         85%          80%
Payor source as a percentage of total
  revenue
  Private pay..........................         25%          25%         25%         25%         25%          28%
  Medicare.............................         24%          26%         24%         24%         24%          22%
  Medicaid.............................         51%          49%         51%         51%         51%          50%


- ---------------

(1) "EBITDA" is defined as net (loss) earnings before income taxes, minority
    interests and extraordinary item as adjusted for net interest expense,
    depreciation, amortization, and non-cash, non recurring losses on asset
    disposals and impairments, primarily from Florida and Texas. "Adjusted
    EBITDA" is defined as EBITDA as adjusted for operating income from
    discontinued operations, the June 2002 purchase of seven facilities that
    were previously leased and the provisions for self-insured liabilities
    related to discontinued operations. "EBITDAR" is defined as EBITDA as
    adjusted for lease costs. "Adjusted EBITDAR" is defined as EBITDAR as
    adjusted for operating income from discontinued operations, the June 2002
    purchase of seven facilities that were previously leased and the provisions
    for self-insured liabilities related to discontinued operations. Our
    definitions of EBITDA, EBITDAR, Adjusted EBITDA and Adjusted EBITDAR may not
    be comparable to the definitions of EBITDA and EBITDAR used by other
    companies. "Adjusted EBITDA margin" is defined as Adjusted EBITDA as a
    percent of total revenues from continuing operations. "Adjusted EBITDAR
    margin" is defined as Adjusted EBITDAR as a percent of total

                                        12


revenues from continuing operations. The following table reconciles net (loss)
earnings to EBITDA, Adjusted EBITDA and Adjusted EBITDAR:



                                                            TWELVE        THREE MONTHS
                                                            MONTHS           ENDED
                                                             ENDED         MARCH 31,            YEAR ENDED DECEMBER 31,
                                                           MARCH 31,   ------------------   -------------------------------
                                                             2002       2002       2001       2001       2000       1999
                                                           ---------   -------   --------   --------   --------   ---------
                                                                                (DOLLARS IN THOUSANDS)
                                                                                                
      (LOSS) EARNINGS BEFORE INCOME TAXES, MINORITY
        INTERESTS AND EXTRAORDINARY ITEM................   $(26,532)   $ 2,970   $(10,430)  $(39,932)  $(82,346)  $(123,180)
      Add:
        Loss on disposal of assets and other items......     22,837         --      1,409     24,246      6,663      42,774
        Loss on impairment of long-lived assets.........      1,685         --         --      1,685     20,753      38,173
        Interest, net...................................     33,698      7,988      9,850     35,560     45,155      51,267
        Depreciation and amortization...................     39,908      9,434     10,298     40,772     45,434      52,005
                                                           --------    -------   --------   --------   --------   ---------
      EBITDA............................................     71,596     20,392     11,127     62,331     35,659      61,039
                                                           --------    -------   --------   --------   --------   ---------
      Less: Operating income from discontinued
        operations......................................       (521)        --       (238)      (759)    (6,160)     (9,406)
      Adjustment for Medicare settlement................         --         --         --         --     (9,527)      9,527
      Add: Increase in depreciation due to June 2002
        purchase of seven leased facilities.............      1,792        448        448      1,793      1,793       1,791
      General and professional liability provision
        allocated to discontinued operations............     10,523         --        123     10,645     50,798       3,273
                                                           --------    -------   --------   --------   --------   ---------
      ADJUSTED EBITDA...................................     83,390     20,840     11,460     74,010     72,563      66,224
                                                           --------    -------   --------   --------   --------   ---------
      Add: Lease costs..................................     13,792      3,034      3,817     14,575     15,731      16,631
      Less: reduction in lease costs due to June 2002
        purchase of seven leased facilities.............     (1,792)      (448)      (448)    (1,793)    (1,793)     (1,791)
                                                           --------    -------   --------   --------   --------   ---------
      ADJUSTED EBITDAR..................................   $ 95,390    $23,426   $ 14,829   $ 86,792   $ 86,501   $  81,064
                                                           ========    =======   ========   ========   ========   =========


(2) EBITDA, EBITDAR, Adjusted EBITDA and Adjusted EBITDAR are not measures of
    performance under generally accepted accounting principles, or GAAP. While
    EBITDA, EBITDAR, Adjusted EBITDA and Adjusted EBITDAR should not be
    considered in isolation or as a substitute for net income, cash flows from
    operating activities and other income or cash flow statement data prepared
    in accordance with generally accepted accounting principles in the United
    States, or GAAP, or as a measure of profitability or liquidity, we
    understand that EBITDA and/or EBITDAR are customarily used by financial and
    credit analysts as a criteria in evaluating healthcare companies. Moreover,
    substantially all of our financing agreements contain covenants in which
    EBITDA is used as a measure of financial performance.

(3) Pro forma to reflect the issuance of the old notes and the application of
    the proceeds from that issuance. Lease costs are capitalized at 8.0x.

(4) The ratio of earnings to fixed charges for the year ended December 31, 1998
    is 2.63x and the ratio of earnings to fixed charges for the year ended
    December 31, 1997 is 2.89x. For the purpose of calculating the ratio of
    earnings to fixed charges, earnings consist of (loss) earnings before income
    taxes, minority interest and extraordinary item, adjusted to add back
    interest expense, amortization of deferred financing costs and estimated
    interest within rental expense. Fixed charges consist of interest,
    amortization of deferred financing costs and estimated interest within
    rental expense. The ratio of earnings to fixed charges for the three month
    period ended March 31, 2002 and the year ended December 31, 2001, on a pro
    forma basis to reflect the issuance of the old notes and the application of
    the proceeds from that issuance, was 1.15x and 0.09x, respectively. The
    amount of the deficiency (the amount by which fixed charges exceed earnings)
    for the three month period ended March 31, 2001, and the years ended
    December 31, 2001, 2000 and 1999, was $10,430, $39,932, $82,346 and
    $123,481, respectively. The amount of the deficiency for the pro forma basis
    ratio for the year ended December 31, 2001 was $45,360.

(5) Total debt includes long term debt and current maturities of long term debt.

(6) Excludes properties leased and held under Greystone divestiture agreement.

(7) Based upon our operational beds for nursing facilities and units following
    one year of operation for assisted living and retirement facilities and
    excluding occupancy for facilities under management and specific consulting
    services agreements.

                                        13


                                  RISK FACTORS

     You should consider carefully each of the following risks and all other
information contained in this prospectus before deciding to exchange your old
notes for new notes. The risks and uncertainties described below are not the
only ones we face.

                     RISKS RELATING TO US AND OUR BUSINESS

WE DEPEND UPON REIMBURSEMENT FOR OUR SERVICES BY THIRD-PARTY PAYORS, AND CHANGES
IN THEIR REIMBURSEMENT LEVELS COULD ADVERSELY AFFECT OUR REVENUES, RESULTS OF
OPERATIONS AND FINANCIAL POSITION.

     Substantially all of our long-term and rehabilitation revenues are derived
from private and governmental third-party payors. In 2001, approximately 24% of
our revenues were derived from Medicare, 51% from Medicaid and approximately 25%
from commercial insurers, managed care plans, the Department of Veterans Affairs
and other private pay sources. There are ongoing pressures from many payors to
control health care costs and to reduce or limit increases in reimbursement
rates for medical services. Governmental payment programs are subject to
statutory and regulatory changes, retroactive rate adjustments, administrative
or executive orders and government funding restrictions, all of which may
materially change the amount of payments to us for our services. Medicare
funding levels have changed significantly over the past few years. For example,
in 1998 and 1999, the industry experienced a decline in revenues primarily
attributable to declines in government reimbursement as a result of the Balanced
Budget Act of 1997. The revenue rate reductions from the Balanced Budget Act are
being partially offset by the Balanced Budget Refinement Act of 1999 and the
Benefits Improvement Protective Act of 2000. We cannot assure you that payments
from governmental or private payors will remain at levels comparable to present
levels or will, in the future, be sufficient to cover the costs allocable to
patients eligible for reimbursement pursuant to such programs. See
"Business -- Government Regulation" for additional information.

THE COST OF GENERAL AND PROFESSIONAL LIABILITY CLAIMS ARE SIGNIFICANT.

     We have experienced an increasing trend in the number and severity of
litigation claims asserted against us, including personal injury and wrongful
death claims. We believe that this trend is endemic to the long-term care
industry and is a result of the increasing number of large judgments, including
large punitive damage awards, against long-term care providers in recent years
resulting in an increased awareness by plaintiff's lawyers of potentially large
recoveries. This has been particularly the case in Florida and Texas where we
have ceased to operate skilled nursing facilities. Industry sources report the
average cost of a claim in Florida in 2000 was three times higher than most of
the rest of the United States. Florida health care providers experienced four
times the number of claims as providers in most other states experienced. We
ceased all operations in Florida as of December 31, 2000 and all skilled nursing
facility operations in Texas as of September 30, 2001. As a result of the
litigious environment, insurance coverage for general and professional liability
claims has increased and in certain states become unavailable to skilled nursing
facility operators, as insurance companies have refrained from providing
insurance in certain states.

     Since January 1, 2000, we are essentially self-insured for general and
professional liability claims up to a certain amount per incident. We have
provided for all general and professional liability claims based on an
independent actuarial review; however, we may need to increase our accrual for
claims in excess of the amounts we have accrued with respect to such claims. An
adverse determination in legal proceedings, whether currently asserted or
arising in the future, could have a material adverse effect on us. See
"Business -- Insurance."

THE SHORTAGE OF QUALIFIED REGISTERED NURSING STAFF AND OTHER HEALTH CARE WORKERS
COULD ADVERSELY AFFECT OUR ABILITY TO ATTRACT, TRAIN AND RETAIN QUALIFIED
PERSONNEL AND COULD INCREASE OPERATING COSTS.

     A shortage of nurses and other trained personnel and general inflationary
pressures have forced us to enhance our wage and benefits packages in order to
compete for qualified personnel. In some of the
                                        14


markets where we operate, there are shortages of health care workers. In order
to supplement staffing levels, we periodically use costly temporary help from
staffing agencies.

WE CONDUCT OUR BUSINESS IN A HEAVILY REGULATED INDUSTRY AND OUR FAILURE TO
COMPLY WITH LAWS AND GOVERNMENT REGULATION COULD LEAD TO FINES AND PENALTIES.

     We must comply with complex laws and regulations at the federal, state and
local government levels relating to, among other things:

     - licensure and certification;

     - qualifications of health care and support personnel;

     - maintenance of physical plant and equipment;

     - staffing levels and quality of health care services;

     - maintenance, confidentiality and security issues associated with medical
       records;

     - relationships with physicians and referral sources;

     - billing for services;

     - operating policies and procedures; and

     - additions or changes to facilities and services.

     There are ongoing initiatives at the federal and state levels for
comprehensive reforms affecting the payment for and availability of health care
services. In addition, regulations and policies of regulatory agencies are
subject to change. Aspects of some of these health care initiatives, such as the
termination of Medicare funding improvements and limitations on Medicare
coverage, other pressures to contain health care costs by Medicare, Medicaid and
other payors, as well as increased operational requirements in the
administration of Medicaid, could adversely affect our financial condition or
our results of operations. Revisions to regulatory requirements, changes in
scope and quality of care to residents and revisions to licensure and
certification standards also could potentially have a material impact on us. In
the future, different interpretations or enforcement of existing, new or amended
laws and regulations could result in allegations of impropriety or illegality or
could result in changes requiring capital expenditure programs and operating
expenses.

     If we do not comply with applicable laws and regulations, then we could be
subject to liabilities, including criminal penalties and civil penalties and
exclusion of one or more of our facilities from participation in Medicare,
Medicaid and other federal and state health care programs. In 1998, we operated
one facility in Maryland that lost its certification under the Medicare and
Medicaid programs. In November 2000, we operated one facility in Indiana that
lost its certification under the Medicare and Medicaid programs but has since
been recertified under both programs.

IF WE DO NOT ACHIEVE AND MAINTAIN COMPETITIVE QUALITY OF CARE RATINGS FROM THE
CENTERS FOR MEDICARE AND MEDICAID SERVICES, OUR BUSINESS MAY BE NEGATIVELY
AFFECTED.

     The Centers for Medicare and Medicaid Services, or CMS, launched the
Nursing Home Quality Initiative pilot program in April 2002 in Colorado,
Florida, Maryland, Ohio, Rhode Island and Washington. This program, which is
designed to provide consumers with comparative information about nursing home
quality measures, will rate every nursing home operating in these states on nine
quality of care indicators. These quality of care indicators include such
measures as percentages of patients with infections, bedsores and unplanned
weight loss. This comparative data will be made available to the public on CMS's
web site. CMS has announced that if this pilot program is successful, it intends
to expand the initiative to all other states. We currently operate nursing homes
in Ohio and Washington. If we are unable to achieve quality of care ratings in
these states that are comparable or superior to those of our

                                        15


competitors, our ability to attract and retain patients could be affected and,
as a result, our revenues could decline.

IF WE FAIL TO CULTIVATE NEW OR MAINTAIN EXISTING RELATIONSHIPS WITH THE
PHYSICIANS IN THE COMMUNITIES IN WHICH WE OPERATE, OUR PATIENT BASE MAY
DECREASE.

     Our success depends in part upon the admissions and referral practices of
the physicians in the communities in which we operate and our ability to
cultivate and maintain relationships with these physicians. Physicians referring
patients to our facilities are not our employees and are free to refer their
patients to other providers. If we are unable to successfully cultivate and
maintain strong relationships with these physicians, our patient population may
decline.

WE FACE NATIONAL, REGIONAL AND LOCAL COMPETITION.

     Our nursing and assisted living facilities compete on a local and regional
basis with other long-term care providers. The number of competing centers in
the local market, the types of services available, quality of care, reputation,
age and appearance of each center and the cost of care in each locality all
affect our ability to compete successfully. The availability and quality of
competing facilities significantly influence occupancy levels in assisted living
facilities. There are relatively few barriers to entry in the assisted living
industry and, therefore, future development of assisted living facilities in the
markets we serve could limit our ability to attract and retain residents, to
maintain or increase resident service fees or to expand our business. See
"Business -- Competition."

STATE EFFORTS TO REGULATE THE CONSTRUCTION OR EXPANSION OF HEALTH CARE PROVIDERS
COULD IMPAIR OUR ABILITY TO EXPAND THROUGH CONSTRUCTION AND REDEVELOPMENT.

     Most of the states in which we currently operate have adopted laws to
regulate expansion of skilled nursing facilities. Certificate of need laws
generally require that a state agency approve certain acquisitions or physical
plant changes and determine that a need exists prior to the addition of beds or
services, the implementation of the physical plant changes or the incurrence of
capital expenditures exceeding a prescribed amount. Some states also prohibit,
restrict or delay the issuance of certificates of need. Many states have
established similar certificate of need processes to regulate the expansion of
assisted living facilities.

     If certificates of need or other similar approvals are required in order to
expand our operations, our failure or inability to obtain the necessary
approvals, changes in the standards applicable to such approvals and possible
delays and expenses associated with obtaining such approvals could adversely
affect our ability to expand and, accordingly, to increase our revenues and
earnings. We cannot assure you that we will be able to obtain a certificate of
need or other regulatory approval for all future projects requiring such
approval.

     Many states in which we operate have implemented moratoria on the granting
of licenses for any additional skilled nursing facility beds. In these states we
may only expand by acquiring existing operations and licensure rights from other
skilled nursing care providers. We cannot guarantee that we will be able to find
acceptable acquisition targets in these states and, as a result, we may not be
able to expand in these states.

WE FACE PERIODIC REVIEWS, AUDITS AND INVESTIGATIONS UNDER OUR CONTRACTS WITH
FEDERAL AND STATE GOVERNMENT AGENCIES, AND THESE AUDITS COULD HAVE ADVERSE
FINDINGS THAT MAY NEGATIVELY IMPACT OUR BUSINESS.

     As a result of our participation in the Medicare and Medicaid programs, we
are subject to various governmental reviews, audits and investigations to verify
our compliance with these programs and

                                        16


applicable laws and regulations. Private pay sources also reserve the right to
conduct audits. An adverse review, audit or investigation could result in:

     - refunding amounts we have been paid pursuant to the Medicare or Medicaid
       programs or from private payors;

     - state or federal agencies imposing fines, penalties and other sanctions
       on us;

     - loss of our right to participate in the Medicare or Medicaid programs or
       one or more private payor networks; or

     - damages to our reputation in various markets.

     Both federal and state government agencies have heightened and coordinated
civil and criminal enforcement efforts as part of numerous ongoing
investigations of health care companies and, in particular, skilled nursing
facilities. The investigations include:

     - cost reporting and billing practices;

     - quality of care;

     - financial relationships with referral sources; and

     - medical necessity of services provided.

     We also are subject to potential lawsuits under a federal whistleblower
statute designed to combat fraud and abuse in the healthcare industry. These
lawsuits can involve significant monetary and award bounties to private
plaintiffs who successfully bring these suits.

WE ARE REQUIRED TO COMPLY WITH LAWS GOVERNING THE TRANSMISSION AND PRIVACY OF
HEALTH INFORMATION.

     The Health Insurance Portability and Accountability Act of 1996 requires us
to comply with standards for the exchange of health information within our
company and with third parties. These include standards for:

     - common health care transactions, such as claims information, plan
       eligibility, payment information and the use of electronic signatures;

     - unique identifiers for providers, employers, health plans and
       individuals;

     - security;

     - privacy; and

     - enforcement.

The Department of Health and Human Services has released two standards: one
governing health care transactions and the second relating to the privacy of
individually identifiable health information. Rules governing the security of
health information have been proposed but not finalized. We generally must
comply with the transaction standards by October 2003 and with the privacy
standards by April 2003. The cost of implementing the new standards may require
us to make significant expenditures. If we fail to comply with the new
standards, we could be subject to criminal penalties and civil sanctions.

WE MAY MAKE ACQUISITIONS THAT COULD SUBJECT US TO A NUMBER OF OPERATING RISKS.

     We anticipate that we may continue to make acquisitions of, investments in,
and strategic alliances with, complementary businesses to enable us to add
services for our customer base and for adjacent markets and to expand each of
our businesses geographically. However, implementation of this strategy entails
a number of risks including:

     - inaccurate assessment of undisclosed liabilities;

     - entry into markets in which we may have limited or no experience;
                                        17


     - diversion of management's attention from our core business;

     - difficulties in assimilating the operations of an acquired business or in
       realizing projected efficiencies and cost savings; and

     - increasing our indebtedness and limiting our ability to access additional
       capital when needed.

     Certain changes may be necessary to integrate the acquired businesses into
our operations, to assimilate new employees and to implement reporting,
monitoring, compliance and forecasting procedures.

             RISKS RELATING TO THE EXCHANGE OFFER AND THE NEW NOTES

YOU MAY HAVE DIFFICULTY SELLING THE OLD NOTES THAT YOU DO NOT EXCHANGE.

     If you do not exchange your old notes for the new notes offered in this
exchange offer, then you will continue to be subject to the restrictions on the
transfer of your old notes. Those transfer restrictions are described in the
indenture governing the notes and in the legend contained on the old notes, and
arose because we originally issued the old notes under exemptions from, and in
transactions not subject to, the registration requirements of the Securities
Act.

     In general, you may offer or sell your old notes only if they are
registered under the Securities Act and applicable state securities laws, or if
they are offered and sold under an exemption from those requirements. We do not
intend to register the old notes under the Securities Act.

     If a large number of old notes are exchanged for new notes in the exchange
offer, then it may be more difficult for you to sell your unexchanged old notes.
Additionally, if you do not exchange your old notes in the exchange offer, then
you will no longer be entitled to have those notes registered under the
Securities Act. See "The Exchange Offer -- Consequences of Failure to Exchange
Old Notes."

OUR INDEBTEDNESS COULD ADVERSELY AFFECT OUR FINANCIAL HEALTH AND OUR ABILITY TO
FULFILL OUR OBLIGATIONS UNDER THE NEW NOTES.

     As of March 31, 2002, our total consolidated indebtedness, after giving
effect to the issuance of the old notes and the application of the proceeds
therefrom, was approximately $388.3 million. We used the net proceeds from
issuance of the old notes to refinance all borrowings under our existing credit
facility, under one existing industrial development revenue bond and under one
other promissory note. The existing credit facility was refinanced with a new
credit facility that provides senior secured financing of up to $105.0 million
on a revolving basis.

     Our indebtedness could have important consequences to you including:

     - making it more difficult for us to satisfy our obligations with respect
       to the notes;

     - increasing our vulnerability to general adverse economic and industry
       conditions;

     - requiring that a portion of our cash flow from operations be used for the
       payment of interest on our debt, thereby reducing our ability to use our
       cash flow to fund working capital, capital expenditures, acquisitions and
       general corporate requirements;

     - limiting our ability to obtain additional financing to fund future
       working capital, capital expenditures, acquisitions and general corporate
       requirements;

     - limiting our flexibility in planning for, or reacting to, changes in our
       business and the healthcare industry; and

     - placing us at a competitive disadvantage to our competitors that have
       less indebtedness.

     We and our subsidiaries may be able to incur additional indebtedness in the
future, including secured indebtedness. The terms of the indenture do not fully
prohibit us or our subsidiaries from doing so. If new indebtedness is added to
our and our subsidiaries' current indebtedness levels, the related risks that we
and they now face could intensify.

                                        18


COVENANT RESTRICTIONS UNDER OUR NEW CREDIT FACILITY AND OUR INDENTURES MAY LIMIT
OUR ABILITY TO OPERATE OUR BUSINESS.

     Our new credit facility, the indenture governing our senior subordinated
notes and the indenture governing the notes contain, among other things,
covenants that may restrict our and our subsidiary guarantors' ability to
finance future operations or capital needs or to engage in other business
activities. Our credit facility and the indentures restrict, among other things,
our ability and the ability of our subsidiaries to:

     - incur additional indebtedness;

     - create liens;

     - pay dividends on or redeem capital stock;

     - make certain investments;

     - make restricted payments;

     - make certain dispositions of assets;

     - engage in certain transactions with affiliates;

     - engage in certain business activities; and

     - engage in mergers, consolidations and certain sales of assets.

     In addition, our new credit facility requires us to maintain specified
financial ratios and tests which may require that we take action to reduce our
debt or to act in a manner contrary to our business objectives. Events beyond
our control, including changes in general business and economic conditions, may
affect our ability to meet those financial ratios and tests. We cannot assure
you that we will meet those ratios and tests or that the lenders will waive any
failure to meet those ratios and tests. A breach of any of these covenants would
result in a default under our credit facility and any resulting acceleration
under the credit facility may result in a default under the indenture. If an
event of default under our credit facility occurs, the lenders could elect to
declare all amounts outstanding thereunder, together with accrued interest, to
be immediately due and payable. See the "Description of Other Indebtedness" and
"Description of the New Notes" for additional information.

OUR BUSINESS AND FINANCIAL RESULTS DEPEND ON OUR ABILITY TO GENERATE SUFFICIENT
CASH FLOWS TO SERVICE OUR DEBT OR REFINANCE OUR INDEBTEDNESS ON COMMERCIALLY
REASONABLE TERMS.

     Our ability to make payments on and to refinance our debt and to fund
planned expenditures depends on our ability to generate cash flow in the future.
This, to some extent, is subject to general economic, financial, competitive,
legislative and regulatory factors and other factors that are beyond our
control. We cannot assure you that our business will generate cash flows from
operations or that future borrowings will be available to us under our new
credit facility in an amount sufficient to enable us to pay our debt or to fund
our other liquidity needs. We cannot assure you that we will be able to
refinance our borrowing arrangements or any other outstanding debt on
commercially reasonable terms or at all. Refinancing our borrowing arrangements
could cause us to:

     - pay higher interest;

     - be subject to additional or more restrictive covenants than those
       outlined above; and

     - grant additional security interests in our collateral.

     Our inability to generate sufficient cash flow to service our debt or
refinance our indebtedness on commercially reasonable terms would have a
material adverse effect on our business and results of operations.

                                        19


AS A HOLDING COMPANY, WE RELY ON PAYMENTS FROM OUR SUBSIDIARIES IN ORDER FOR US
TO MAKE PAYMENTS ON THE NOTES.

     We are a holding company with no significant operations of our own. Because
our operations are conducted through our subsidiaries, we depend on dividends,
loans, advances and other payments from our subsidiaries in order to allow us to
satisfy our financial obligations. Our subsidiaries are separate and distinct
legal entities and have no obligation to pay any amounts to us, whether by
dividends, loans, advances or other payments. The ability of our subsidiaries to
pay dividends and make other payments to us depends on their earnings, capital
requirements and general financial conditions and is restricted by, among other
things, applicable corporate and other laws and regulations as well as, in the
future, agreements to which our subsidiaries may be a party. Although our
subsidiary guarantors are guaranteeing the notes, each guarantee is subordinated
to all secured debt of the relevant subsidiary guarantor.

ALTHOUGH THE NOTES ARE REFERRED TO AS "SENIOR NOTES," AND THE SUBSIDIARY
GUARANTEES ARE SENIOR OBLIGATIONS OF OUR SUBSIDIARIES, EACH WILL BE EFFECTIVELY
SUBORDINATED TO OUR AND OUR SUBSIDIARY GUARANTORS' SECURED INDEBTEDNESS.

     The notes and our subsidiaries' guarantees are effectively subordinated in
right of payment to all of our and our subsidiary guarantors' secured
indebtedness to the extent of the value of the assets securing that
indebtedness, which consists primarily of indebtedness under the new credit
facility. In the event of our or one of our guarantor's bankruptcy, liquidation,
reorganization or other winding up, the assets securing our or our guarantor's
debt, as the case may be, will be available to pay obligations on the notes or
guarantees, only after all such secured debt has been repaid in full from such
assets. There may not be sufficient assets remaining to pay amounts due on any
or all of the notes or guarantees, as the case may be, that are outstanding.

A COURT MAY VOID THE GUARANTEES OF THE NOTES OR SUBORDINATE THE GUARANTEES TO
OTHER OBLIGATIONS OF OUR SUBSIDIARY GUARANTORS.

     Although standards may vary depending upon the applicable law, generally
under U.S. federal bankruptcy law and comparable provisions of state fraudulent
transfer laws, a court could void all or a portion of the guarantees of the
notes or subordinate the guarantees to other obligations of our subsidiary
guarantors. If the claims of the holders of the notes against any guarantor were
held to be subordinated in favor of other creditors of that guarantor, the other
creditors would be entitled to be paid in full before any payment could be made
on the notes. If one or more of the guarantees is voided or subordinated, we
cannot assure you that after providing for all prior claims, there would be
sufficient assets remaining to satisfy the claims of the holders of the notes.

WE MAY BE UNABLE TO REPURCHASE THE NOTES IF WE EXPERIENCE A CHANGE IN CONTROL.

     If we were to experience a change of control, the indenture governing the
notes and the indenture governing the senior subordinated notes require us to
offer to purchase all of the outstanding notes and senior subordinated notes.
Our failure to repay holders tendering notes upon a change of control will
result in an event of default under the notes and the senior subordinated notes.
A change of control or an event of default under the notes or the senior
subordinated notes may also result in an event of default under our new credit
facility, which may result in the acceleration of the indebtedness under that
facility requiring us to repay that indebtedness immediately. If a change of
control were to occur, we cannot assure you that we would have sufficient funds
to repay debt outstanding under the new credit facility or to purchase the
notes, the senior subordinated notes or any other securities which we would be
required to offer to purchase. We expect that we would require additional
financing from third parties to fund any such purchases, and we cannot assure
you that we would be able to obtain financing on satisfactory terms or at all.
See "Description of Other Indebtedness" and "Description of the Notes."

                                        20


NO PUBLIC MARKET EXISTS FOR THE NOTES, AND ANY MARKET FOR THE NOTES MAY BE
ILLIQUID.

     The notes are a new issue of securities with no established trading market.
We do not intend to list the notes for trading on any stock exchange or arrange
for any quotation system to quote prices for them. The initial purchasers for
the old notes have informed us that they intend to make a market in the notes.
However, the initial purchasers are not obligated to do so and may cease
market-making activities at any time. As a result, we cannot assure you that an
active trading market will develop or continue for the notes.

                                        21


                               THE EXCHANGE OFFER

PURPOSE AND EFFECT; REGISTRATION RIGHTS

     We sold the old notes on June 20, 2002 in transactions exempt from the
registration requirements of the Securities Act. Therefore, the old notes are
subject to significant restrictions on resale. In connection with the issuance
of the old notes; we entered into a registration rights agreement, which
required that we and the subsidiary guarantors:

     - file with the SEC a registration statement under the Securities Act
       relating to the exchange offer and the issuance and delivery of the new
       notes in exchange for the old notes;

     - use our best efforts to cause the SEC to declare the exchange offer
       registration statement effective under the Securities Act; and

     - use our best efforts to consummate the exchange offer not later than 30
       business days following the effective date of the exchange offer
       registration statement.

     If you participate in the exchange offer, you will, with limited
exceptions, receive new notes that are freely tradeable and not subject to
restrictions on transfer. You should see "The Exchange Offer -- Resales of New
Notes" for more information relating to your ability to transfer new notes.

     If you are eligible to participate in the exchange offer and do not tender
your old notes, you will continue to hold the untendered old notes, which will
continue to be subject to restrictions on transfer under the Securities Act.

     The exchange offer is intended to satisfy our exchange offer obligations
under the registration rights agreement. The above summary of the registration
rights agreement is not complete and is subject to, and qualified by reference
to, all the provisions of the registration rights agreement. A copy of the
registration rights agreement has been filed as an exhibit to the registration
statement that includes this prospectus.

TERMS OF THE EXCHANGE OFFER

     We are offering to exchange $150,000,000 in aggregate principal amount of
our 9 1/2% Senior Notes due 2010 that have been registered under the Securities
Act for a like aggregate principal amount of our outstanding unregistered 9 1/2%
Senior Notes due 2010.

     Upon the terms and subject to the conditions set forth in this prospectus
and in the accompanying letter of transmittal, we will accept all old notes
validly tendered and not withdrawn before 5:00 p.m., New York City time, on the
expiration date of the exchange offer. We will issue $1,000 principal amount of
new notes in exchange for each $1,000 principal amount of outstanding old notes
we accept in the exchange offer. You may tender some or all of your old notes
under the exchange offer. However, the old notes are issuable in authorized
denominations of $1,000 and integral multiples thereof. Accordingly, old notes
may be tendered only in denominations of $1,000 and integral multiples thereof.
The exchange offer is not conditioned upon any minimum amount of old notes being
tendered.

     The form and terms of the new notes will be the same as the form and terms
of the old notes, except that:

     - the new notes will be registered with the SEC and thus will not be
       subject to the restrictions on transfer or bear legends restricting their
       transfer;

     - all of the new notes will be represented by global notes in book-entry
       form unless exchanged for notes in definitive certificated form under the
       limited circumstances described under "Description of the New
       Notes -- Book-Entry, Delivery and Form;" and

     - the new notes will not provide for registration rights and the payment of
       liquidated damages under circumstances relating to the timing of the
       exchange offer.

                                        22


     The new notes will evidence the same debt as the old notes and will be
issued under, and be entitled to the benefits of, the indenture governing the
old notes.

     The new notes will accrue interest from the most recent date to which
interest has been paid on the old notes or, if no interest has been paid, from
the date of issuance of the old notes. Accordingly, registered holders of new
notes on the record date for the first interest payment date following the
completion of the exchange offer will receive interest accrued from the most
recent date to which interest has been paid on the old notes or, if no interest
has been paid, from the date of issuance of the old notes. However, if that
record date occurs prior to completion of the exchange offer, then the interest
payable on the first interest payment date following the completion of the
exchange offer will be paid to the registered holders of the old notes on that
record date.

     In connection with the exchange offer, you do not have any appraisal or
dissenters' rights under applicable law or the indenture. We intend to conduct
the exchange offer in accordance with the registration rights agreement and the
applicable requirements of the Securities Exchange Act of 1934 and the rules and
regulations of the SEC. The exchange offer is not being made to, nor will we
accept tenders for exchange from, holder of the old notes in any jurisdiction in
which the exchange offer or the acceptance of it would not be in compliance with
the securities or blue sky laws of the jurisdiction.

     We will be deemed to have accepted validly tendered old notes when we have
given oral or written notice of our acceptance to the exchange agent. The
exchange agent will act as agent for the tendering holders for the purpose of
receiving the new notes from us.

     If we do not accept any tendered old notes because of an invalid tender or
for any other reason, then we will return certificates for any unaccepted old
notes without expense to the tendering holder as promptly as practicable after
the expiration date.

EXPIRATION DATE; AMENDMENTS

     The exchange offer will expire at 5:00 p.m., New York City time, on
          , 2002, unless we, in our sole discretion, extend the exchange offer.

     If we determine to extend the exchange offer, then we will notify the
exchange agent of any extension by oral or written notice and give each
registered holder notice of the extension by means of a press release or other
public announcement before 5:00 p.m., New York City time, on the next business
day after the previously scheduled expiration date.

     We reserve the right, in our sole discretion, to delay accepting any old
notes, to extend the exchange offer or to amend or terminate the exchange offer
if any of the conditions described below under "-- Conditions to the Exchange
Offer" have not been satisfied or waived by giving oral or written notice to the
exchange agent of the delay, extension, amendment or termination. Further, we
reserve the right, in our sole discretion, to amend the terms of the exchange
offer in any manner. We will notify you as promptly as practicable of any
extension, amendment or termination. We will also file a post-effective
amendment to the registration statement of which this prospectus is a part with
respect to any fundamental change in the exchange offer.

PROCEDURES FOR TENDERING OLD NOTES

     A holder who wishes to tender old notes in the exchange offer must do
either of the following:

     - properly complete, sign and date the letter of transmittal, including all
       other documents required by the letter of transmittal; have the signature
       on the letter of transmittal guaranteed if the letter of transmittal so
       requires; and deliver that letter of transmittal and other required
       documents to the exchange agent at the address listed below under
       "-- Exchange Agent" on or before the expiration date; or

                                        23


     - if the old notes are tendered under the book-entry transfer procedures
       described below, transmit to the exchange agent an agent's message, which
       agent's message must be received by the exchange agent prior to 5:00
       p.m., New York City time, on the expiration date.

     In addition, one of the following must occur:

     - the exchange agent must receive certificates representing your old notes
       along with the letter of transmittal on or before the expiration date, or

     - the exchange agent must receive a timely confirmation of book-entry
       transfer of the old notes into the exchange agent's account at DTC under
       the procedure for book-entry transfers described below along with the
       letter of transmittal or a properly transmitted agent's message, on or
       before the expiration date; or

     - the holder must comply with the guaranteed delivery procedures described
       below.

     The term "agent's message" means a message, transmitted by a book-entry
transfer facility to and received by the exchange agent and forming a part of
the book-entry confirmation, which states that the book-entry transfer facility
has received an express acknowledgement from the tendering participant stating
that the participant has received and agrees to be bound by the letter of
transmittal, and that we may enforce the letter of transmittal against the
participant.

     To be tendered effectively, the exchange agent must receive any physical
delivery of the letter of transmittal and other required documents at the
address set forth below under "-- Exchange Agent" on or before the expiration of
the exchange offer. To receive confirmation of valid tender of old notes, a
holder should contact the exchange agent at the telephone number listed under
'-- Exchange Agent."

     Any tender of old notes that is not withdrawn prior to the expiration date
will constitute a binding agreement between the tendering holder and us upon the
terms and subject to the conditions set forth in this prospectus and in the
accompanying letter of transmittal. Only a registered holder of old notes may
tender the old notes in the exchange offer. If a holder completing a letter of
transmittal tenders less than all of the old notes held by that holder, then
that tendering holder should fill in the applicable box of the letter of
transmittal. The amount of old notes delivered to the exchange agent will be
deemed to have been tendered unless otherwise indicated.

     The method of delivery of old notes, the letter of transmittal and all
other required documents to the exchange agent is at your election and risk.
Rather than mail these items, we recommend that you use an overnight or hand
delivery service. In all cases, you should allow sufficient time to assure
timely delivery to the exchange agent before the expiration date. Do not send
letters of transmittal or old notes to us.

     Generally, an eligible institution must guarantee signatures on a letter of
transmittal or a notice of withdrawal unless the old notes are tendered:

     - by a registered holder of the old notes who has not completed the box
       entitled "Special Issuance Instructions" or "Special Delivery
       Instructions" on the letter of transmittal; or

     - for the account of an eligible institution.

     If signatures on a letter of transmittal or a notice of withdrawal are
required to be guaranteed, the guarantee must be by a firm which is:

     - a member of a registered national securities exchange;

     - a member of the National Association of Securities Dealers, Inc.;

     - a commercial bank or trust company having an office or correspondent in
       the United States; or

     - another "eligible institution" within the meaning of Rule 17Ad-15 under
       the Securities Exchange Act.

                                        24


     If the letter of transmittal is signed by a person other than the
registered holder of any outstanding old notes, the original notes must be
endorsed or accompanied by appropriate powers of attorney. The power of attorney
must be signed by the registered holder exactly as the registered holder(s)
name(s) appear(s) on the old notes and an eligible institution must guarantee
the signature on the power of attorney.

     If the letter of transmittal, or any old notes or powers of attorney are
signed by trustees, executors, administrators, guardians, attorneys-in-fact,
officers of corporations or others acting in a fiduciary or representative
capacity, these persons should so indicate when signing. Unless waived by us,
they should also submit evidence satisfactory to us of their authority to so
act.

     If you wish to tender old notes that are registered in the name of a
broker, dealer, commercial bank, trust company or other nominee, you should
promptly instruct the registered holder to tender on your behalf. If you wish to
tender on your behalf, you must, before completing the procedures for tendering
old notes, either register ownership of the old notes in your name or obtain a
properly completed bond power from the registered holder. The transfer of
registered ownership may take considerable time.

     We will determine in our sole discretion all questions as to the validity,
form, eligibility, including time of receipt, and acceptance of old notes
tendered for exchange. Our determination will be final and binding on all
parties. We reserve the absolute right to reject any and all tenders of old
notes not properly tendered or old notes our acceptance of which might, in the
judgment of our counsel, be unlawful. We also reserve the absolute right to
waive any defects, irregularities or conditions of tender as to any particular
old notes. Our interpretation of the terms and conditions of the exchange offer,
including the instructions in the letter of transmittal, will be final and
binding on all parties. Unless waived, any defects or irregularities in
connection with tenders of old notes must be cured within the time period we
determine. Neither we, the exchange agent nor any other person will incur any
liability for failure to give you notification of defects or irregularities with
respect to tenders of your old notes.

     By tendering, you will represent to us that:

     - any new notes that the holder receives will be acquired in the ordinary
       course of its business;

     - the holder has no arrangement or understanding with any person or entity
       to participate in the distribution of the new notes;

     - if the holder is not a broker-dealer, that it is not engaged in and does
       not intend to engage in the distribution of the new notes;

     - if the holder is a broker-dealer that will receive new notes for its own
       account in exchange for old notes that were acquired as a result of
       market-making activities or other trading activities, that it will
       deliver a prospectus, as required by law, in connection with any resale
       of those new notes (see "Plan of Distribution"); and

     - the holder is not our "affiliate," as defined in Rule 405 of the
       Securities Act, or, if the holder is our affiliate, it will comply with
       any applicable registration and prospectus delivery requirements of the
       Securities Act.

     If any holder or any such other person is our "affiliate," or is engaged in
or intends to engage in or has an arrangement or understanding with any person
to participate in a distribution of the new notes to be acquired in the exchange
offer, then that holder or any such other person:

     - may not rely on the applicable interpretations of the staff of the SEC;

     - is not entitled and will not be permitted to tender old notes in the
       exchange offer; and

     - must comply with the registration and prospectus delivery requirements of
       the Securities Act in connection with any resale transaction.

     Each broker-dealer who acquired its old notes as a result of market-making
activities or other trading activities and thereafter receives new notes issued
for its own account in the exchange offer, must
                                        25


acknowledge that it will deliver a prospectus in connection with any resale of
such new notes issued in the exchange offer. The letter of transmittal states
that by so acknowledging and by delivering a prospectus, a broker-dealer will
not be deemed to admit that it is an "underwriter" within the meaning of the
Securities Act. See "Plan of Distribution" for a discussion of the exchange and
resale obligations of broker-dealers in connection with the exchange offer.

ACCEPTANCE OF OLD NOTES FOR EXCHANGE; DELIVERY OF NEW NOTES

     Upon satisfaction of all conditions to the exchange offer, we will accept,
promptly after the expiration date, all old notes properly tendered and will
issue the new notes promptly after acceptance of the old notes.

     For purposes of the exchange offer, we will be deemed to have accepted
properly tendered old notes for exchange when we have given oral or written
notice of that acceptance to the exchange agent. For each old note accepted for
exchange, you will receive a new note having a principal amount equal to that of
the surrendered old note.

     In all cases, we will issue new notes for old notes that we have accepted
for exchange under the exchange offer only after the exchange agent timely
receives:

     - certificates for your old notes or a timely confirmation of book-entry
       transfer of your old notes into the exchange agent's account at DTC; and

     - a properly completed and duly executed letter of transmittal and all
       other required documents or a properly transmitted agent's message.

     If we do not accept any tendered old notes for any reason set forth in the
terms of the exchange offer or if you submit old notes for a greater principal
amount than you desire to exchange, we will return the unaccepted or
non-exchanged old notes without expense to you. In the case of old notes
tendered by book-entry transfer into the exchange agent's account at DTC under
the book-entry procedures described below, we will credit the non-exchanged old
notes to your account maintained with DTC.

BOOK-ENTRY TRANSFER

     We understand that the exchange agent will make a request within two
business days after the date of this prospectus to establish accounts for the
old notes at DTC for the purpose of facilitating the exchange offer, and any
financial institution that is a participant in DTC's system may make book-entry
delivery of old notes by causing DTC to transfer the old notes into the exchange
agent's account at DTC in accordance with DTC's procedures for transfer.
Although delivery of old notes may be effected through book-entry transfer at
DTC, the exchange agent must receive a properly completed and duly executed
letter of transmittal with any required signature guarantees, or an agent's
message in lieu of a letter of transmittal, and all other required documents at
its address listed below under "-- Exchange Agent" on or before the expiration
date, or if you comply with the guaranteed delivery procedures described below,
within the time period provided under those procedures.

                                        26


GUARANTEED DELIVERY PROCEDURES

     If you wish to tender your old notes and your old notes are not immediately
available, or you cannot deliver your old notes, the letter of transmittal or
any other required documents or comply with DTC's procedures for transfer before
the expiration date, then you may participate in the exchange offer if:

     - the tender is made through an eligible institution;

     - before the expiration date, the exchange agent receives from the eligible
       institution a properly completed and duly executed notice of guaranteed
       delivery, substantially in the form provided by us, by facsimile
       transmission, mail or hand delivery, containing:

      -- the name and address of the holder and the principal amount of old
         notes tendered;

      -- a statement that the tender is being made thereby; and

      -- a guarantee that within three New York Stock Exchange trading days
         after the expiration date, the certificates representing the old notes
         in proper form for transfer or a book-entry confirmation and any other
         documents required by the letter of transmittal will be deposited by
         the eligible institution with the exchange agent; and

     - the exchange agent receives the properly completed and executed letter of
       transmittal as well as certificates representing all tendered old notes
       in proper form for transfer, or a book-entry confirmation, and all other
       documents required by the letter of transmittal within three New York
       Stock Exchange trading days after the expiration date.

WITHDRAWAL RIGHTS

     You may withdraw your tender of old notes at any time before the exchange
offer expires.

     For a withdrawal to be effective, the exchange agent must receive a written
notice of withdrawal at its address listed below under "-- Exchange Agent." The
notice of withdrawal must:

     - specify the name of the person who tendered the old notes to be
       withdrawn;

     - identify the old notes to be withdrawn, including the principal amount,
       or, in the case of old notes tendered by book-entry transfer, the name
       and number of the DTC account to be credited, and otherwise comply with
       the procedures of DTC; and

     - if certificates for old notes have been transmitted, specify the name in
       which those old notes are registered if different from that of the
       withdrawing holder.

     If you have delivered or otherwise identified to the exchange agent the
certificates for old notes, then, before the release of these certificates, you
must also submit the serial numbers of the particular certificates to be
withdrawn and a signed notice of withdrawal with the signatures guaranteed by an
eligible institution, unless the holder is an eligible institution.

     We will determine in our sole discretion all questions as to the validity,
form and eligibility, including time of receipt, of notices of withdrawal. Our
determination will be final and binding on all parties. Any old notes so
withdrawn will be deemed not to have been validly tendered for purposes of the
exchange offer. We will return any old notes that have been tendered but that
are not exchanged for any reason to the holder, without cost, as soon as
practicable after withdrawal, rejection of tender or termination of the exchange
offer. In the case of old notes tendered by book-entry transfer into the
exchange agent's account at DTC, the old notes will be credited to an account
maintained with DTC for the old notes. You may retender properly withdrawn old
notes by following one of the procedures described under "-- Procedures for
Tendering Old Notes" at any time on or before the expiration date.

                                        27


CONDITIONS TO THE EXCHANGE OFFER

     Notwithstanding any other term of the exchange offer, we will not be
required to accept for exchange, or to exchange new notes for, any old notes if
in our reasonable judgement:

     - the new notes to be received will not be tradable by the holder, without
       restriction under the Securities Act and the Securities Exchange Act and
       without material restrictions under the blue sky or securities laws of
       substantially all of the states of the United States;

     - the exchange offer, or the making of any exchange by a holder of old
       notes, would violate any applicable law or applicable interpretation by
       the staff of the SEC; or

     - any action or proceeding is instituted or threatened in any court or by
       or before any governmental agency with respect to the exchange offer
       which, in our judgment, would reasonably be expected to impair our
       ability to proceed with the exchange offer.

     The conditions listed above are for our sole benefit and we may assert them
regardless of the circumstances giving rise to any condition. Subject to
applicable law, we may waive these conditions in our discretion in whole or in
part at any time and from time to time. If we waive these conditions, then we
intend to continue the exchange offer for at least five business days after the
waiver. If we fail at any time to exercise any of the above rights, the failure
will not be deemed a waiver of those rights, and those rights will be deemed
ongoing rights which may be asserted at any time and from time to time.

     We will not accept for exchange any old notes tendered, and will not issue
new notes in exchange for any old notes, if at that time a stop order is
threatened or in effect with respect to the registration statement of which this
prospectus is a part or the qualification of the indentures under the Trust
Indenture Act of 1939.

EXCHANGE AGENT

     U.S. Bank, N.A. is the exchange agent for the exchange offer. You should
direct any questions and requests for assistance and requests for additional
copies of this prospectus, the letter of transmittal or the notice of guaranteed
delivery to the exchange agent addressed as follows:

     By Hand, Overnight Mail, Courier, or Registered or Certified Mail:

     U.S. Bank Trust Center
     180 East Fifth Street
     St. Paul, MN 55101
     Attention: Specialized Finance Group

     By Facsimile:

     (651) 244-1537
     Attention: Specialized Finance Group

     Delivery of the letter of transmittal to an address other than as listed
above or transmission via facsimile other than as listed above will not
constitute a valid delivery of the letter of transmittal.

FEES AND EXPENSES

     We will pay the expenses of the exchange offer. We will not make any
payments to brokers, dealers or others soliciting acceptances of the exchange
offer. We are making the principal solicitation by mail; however, our officers
and employees may make additional solicitations by facsimile transmission,
e-mail, telephone or in person. You will not be charged a service fee for the
exchange of your old notes, but we may require you to pay any transfer or
similar government taxes in certain circumstances.

                                        28


TRANSFER TAXES

     You will be obligated to pay any transfer taxes applicable to the transfer
of the old notes pursuant to the exchange offer.

ACCOUNTING TREATMENT

     We will record the new notes in our accounting records at the same carrying
values as the old notes, which is the aggregate principal amount of the old
notes, as reflected in our accounting records on the date of exchange.
Accordingly, we will not recognize any gain or loss for accounting purposes in
connection with the exchange offer. We will amortize the expenses of the
exchange offer over the term of the new notes.

RESALES OF NEW NOTES

     Based on interpretations of the staff of the SEC, as set forth in no-action
letters to third parties, we believe that new notes issued under the exchange
offer in exchange for old notes may be offered for resale, resold and otherwise
transferred by any old note holder without further registration under the
Securities Act and without delivery of a prospectus that satisfies the
requirements of Section 10 of the Securities Act if:

     - the holder is not our "affiliate" within the meaning of Rule 405 under
       the Securities Act;

     - the new notes are acquired in the ordinary course of the holder's
       business; and

     - the holder does not intend to participate in a distribution of the new
       notes.

     Any holder who exchanges old notes in the exchange offer with the intention
of participating in any manner in a distribution of the new notes must comply
with the registration and prospectus delivery requirements of the Securities Act
in connection with a secondary resale transaction.

     This prospectus may be used for an offer to resell, resale or other
transfer of new notes. With regard to broker-dealers, only broker-dealers that
acquired the old notes as a result of market-making activities or other trading
activities may participate in the exchange offer. Each broker-dealer that
receives new notes for its own account in exchange for old notes, where the old
notes were acquired by the broker-dealer as a result of market-making activities
or other trading activities, must acknowledge that it will deliver a prospectus
in connection with any resale of the new notes. Please see "Plan of
Distribution" for more details regarding the transfer of new notes.

CONSEQUENCES OF FAILURE TO EXCHANGE OLD NOTES

     Holders who desire to tender their old notes in exchange for new notes
registered under the Securities Act should allow sufficient time to ensure
timely delivery. Neither we nor the exchange agent is under any duty to give
notification of defects or irregularities with respect to the tenders of old
notes for exchange.

     Old notes that are not tendered or are tendered but not accepted will,
following the consummation of the exchange offer, continue to be subject to the
provisions in the indenture regarding the transfer and exchange of the old notes
and the existing restrictions on transfer set forth in the legend on the old
notes and in the offering memorandum, dated June 20, 2002, relating to the old
notes. Except in limited circumstances with respect to the specific types of
holders of old notes, we will have no further obligation to provide for the
registration under the Securities Act of such old notes. In general, old notes,
unless registered under the Securities Act, may not be offered or sold except
pursuant to an exemption from, or in a transaction not subject to, the
Securities Act and applicable state securities laws. We do not anticipate that
we will take any action to register the untendered old notes under the
Securities Act or under any state securities laws.

     Upon completion of the exchange offer, holders of the old notes will not be
entitled to any further registration rights under the registration rights
agreement, except under limited circumstances.

                                        29


     Old notes that are not exchanged in the exchange offer will remain
outstanding and continue to accrue interest and will be entitled to the rights
and benefits their holders have under the indenture relating to the old notes
and the new notes. Holders of the new notes and any old notes that remain
outstanding after consummation of the exchange offer will vote together as a
single class for purposes of determining whether holders of the requisite
percentage of the class have taken certain actions or exercised certain rights
under the indenture.

                                        30


                                USE OF PROCEEDS

     This exchange offer is intended to satisfy our obligations under the
registration rights agreement entered into in connection with the issuance of
the old notes. Neither we nor any subsidiary guarantor will receive any proceeds
from the issuance of the new notes. In consideration for issuing the new notes
as contemplated by this prospectus, we will receive the old notes in like
principal amount, the terms of which are identical in all material respects to
the new notes. The old notes surrendered in exchange for the new notes will be
retired and canceled and cannot be reissued. Accordingly, the issuance of the
new notes will not result in any increase or decrease in our indebtedness.

     We used the net proceeds of approximately $145.1 million from the sale of
the old notes to refinance our existing credit facility, an industrial
development revenue bond and an outstanding promissory note. We used the
remainder of the net proceeds for general corporate purposes and to pay related
fees and expenses.

                                        31


                                 CAPITALIZATION

     The following table sets forth the cash and cash equivalents and our
consolidated capitalization as of March 31, 2002 on an actual basis and as
adjusted to give effect to the issuance of the old notes, the application of the
net proceeds of the issuance of the old notes and the entering into of our new
credit facility. You should read this table in conjunction with our consolidated
financial statements and the related notes to the consolidated financial
statements included in this prospectus. See "Use of Proceeds," "Summary
Consolidated Historical Financial and Operating Data," "Selected Consolidated
Historical Financial Data," "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and "Description of Other Indebtedness."



                                                                    MARCH 31, 2002
                                                                ----------------------
                                                                                AS
                                                                 ACTUAL      ADJUSTED
                                                                ---------    ---------
                                                                     (UNAUDITED)
                                                                (DOLLARS IN THOUSANDS)
                                                                       
Cash and cash equivalents...................................    $  2,993     $ 11,662
                                                                ========     ========

Total debt:
  Existing credit facility (including term loans)...........     127,479           --
  New credit facility(1)....................................          --           --
  Industrial development revenue bonds......................      37,381       33,535
  Promissory notes, mortgages and capital lease
     obligations............................................       7,664        5,133
  9.50% Senior Notes due 2010 offered hereby................          --      149,625
  9.35% Senior Subordinated Notes due 2007..................     200,000      200,000
                                                                --------     --------
       Total debt...........................................     372,524      388,293
                                                                --------     --------

Shareholder's equity:
  Common stock..............................................           1            1
  Additional paid-in capital................................     208,787      208,787
  Accumulated other comprehensive loss(2)...................      (2,389)      (1,969)
  Accumulated deficit(3)....................................     (48,762)     (50,344)
                                                                --------     --------
       Total shareholder's equity...........................     157,637      156,475
                                                                --------     --------
       Total capitalization.................................    $530,161     $544,768
                                                                ========     ========


- ---------------

(1) Subject to certain conditions, we may be able to borrow up to $105.0 million
    under our new credit facility. We replaced $40.1 million of letters of
    credit under the old credit facility with new letters of credit under the
    new facility.

(2) Adjusted for a credit, net of income taxes, of $420,000, relating to the
    termination of an existing interest rate swap contract.

(3) Adjusted for a charge, net of income taxes, of $1.2 million, relating to the
    extinguishment of debt related to early repayment of our existing credit
    facility, and a charge, net of income taxes, of $420,000, relating to the
    termination of an existing interest rate swap contract.

                                        32


                SELECTED CONSOLIDATED HISTORICAL FINANCIAL DATA

     The following table summarizes our selected consolidated historical
financial data, which you should read in conjunction with "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and
our consolidated financial statements and related notes, which should be read in
their entirety. The selected consolidated financial data have been derived from
our consolidated financial statements. The unaudited interim period selected
consolidated financial data, in our opinion, reflect all adjustments necessary
to present fairly the data for such periods. Interim results for the three
months ended March 31, 2002 are not necessarily indicative of results that can
be expected in future periods.



                                  THREE MONTHS ENDED
                                       MARCH 31,                         YEAR ENDED DECEMBER 31,
                                  -------------------   ---------------------------------------------------------
                                    2002       2001       2001       2000       1999         1998         1997
                                  --------   --------   --------   --------   ---------   ----------   ----------
                                                              (DOLLARS IN THOUSANDS)
                                                                                  
INCOME STATEMENT DATA:
Revenues(1):
  Nursing and assisted living
    facilities..................  $190,998   $186,556   $766,952   $904,847   $ 916,195   $  990,066   $  796,006
  Outpatient therapy and medical
    supplies....................     2,452      2,322      9,515      9,716      43,068      141,131      113,206
  Other.........................     4,791      4,554     17,640      8,506       8,322        9,238        6,949
                                  --------   --------   --------   --------   ---------   ----------   ----------
      Total revenues............   198,241    193,432    794,107    923,069     967,585    1,140,435      916,161
Costs and expenses:
  Operating.....................   166,604    170,064    684,814    825,172     844,391      953,639      747,016
  General and administrative....     8,211      8,424     32,387     46,507      45,524       45,432       40,510
  Lease costs...................     3,034      3,817     14,575     15,731      16,631       15,895       10,213
  Depreciation and
    amortization................     9,434     10,298     40,772     45,434      52,005       53,723       35,290
  Interest, net.................     7,988      9,850     35,560     45,155      51,267       55,831       24,002
  Loss on impairment of
    long-lived assets...........        --         --      1,685     20,753      38,173           --           --
  Loss (gain) on disposal of
    assets and other items......        --      1,409     24,246      6,663      42,774      (93,337)          --
                                  --------   --------   --------   --------   ---------   ----------   ----------
(Loss) earnings before income
  taxes, minority interests and
  extraordinary item............     2,970    (10,430)   (39,932)   (82,346)   (123,180)     109,252       59,130
Net (loss) earnings.............  $  1,657   $ (6,751)  $(27,495)  $(55,121)  $ (70,457)  $   27,264   $   25,763
                                  ========   ========   ========   ========   =========   ==========   ==========

BALANCE SHEET DATA (AS PERIOD
  END):
Cash and cash equivalents.......  $  2,993   $  1,462   $    997   $  1,641   $   2,941   $    1,084   $    1,418
Working capital.................       538     23,197      4,145     44,473      67,807       17,477       95,184
Property and equipment..........   471,586    501,733    477,830    507,536     610,643      700,141      688,169
Total assets....................   785,725    841,051    795,836    873,590     974,448    1,135,477    1,229,249
Total debt(2)...................   372,524    432,184    385,347    451,147     530,155      547,748      713,324
Shareholder's equity............   157,637    176,466    156,002    184,161     237,895      311,629      281,772


- ---------------

(1) Revenues have been restated for consistency to reflect therapy services
    within nursing facilities.

(2) Total debt includes long term debt and current maturities of long term debt.

                                        33


                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

OVERVIEW

     We are one of the largest providers of long-term care and related services
in the United States. As of March 31, 2002, we operated 139 nursing facilities
with 14,090 beds and 36 assisted living and retirement facilities with 1,756
units that we owned or leased in 13 states. In addition, we managed 18 nursing
facilities with 2,326 beds and five assisted living and retirement facilities
with 156 units and provided selected consulting services to 34 nursing
facilities with 3,195 beds owned by third parties. In total, we operated,
managed or provided selected consulting services to 232 long-term care
facilities with 21,523 beds in 16 states, of which 191 were nursing facilities
with 19,611 beds and 41 were assisted living and retirement facilities with
1,912 units. We are one of the top ten operators of long-term care facilities in
the United States in terms of number of beds and revenues.

Revenues

     We derive revenues by providing healthcare services in our network of
facilities, including long-term care services such as nursing care, assisted
living and related medical services such as subacute care and rehabilitative
therapy. We derive nursing and assisted living facility revenues by providing
routine and ancillary services for our facilities' residents. We derive
outpatient therapy and medical supplies revenues by providing outpatient therapy
services at our clinics and to outside third parties.

     We generate our revenue from Medicare, Medicaid and private pay sources.
The following table sets forth our Medicare, Medicaid and private pay sources of
revenue by percentage of total revenue:



                                                             THREE MONTHS
                                                            ENDED MARCH 31,        YEAR ENDED DECEMBER 31
                                                           -----------------      ------------------------
                                                           2002         2001      2001      2000      1999
                                                           ----         ----      ----      ----      ----
                                                                                       
Medicare...............................................     26%          24%       24%       24%       22%
Medicaid...............................................     49%          51%       51%       51%       50%
Private................................................     25%          25%       25%       25%       28%


Legislative Actions Affecting Revenues

     The incremental Medicare relief packages received from the Balanced Budget
Refinement Act and the Benefits Improvement and Protection Act provide a total
of $2.7 billion in temporary Medicare funding enhancements to the long-term care
industry. The funding enhancements implemented by the Balanced Budget Refinement
Act and Benefits Improvement and Protection Act fall into two categories. The
first category is "legislative add-ons," which includes the 16.66% add-on to the
nursing component of the resource utilization groupings rate and the 4% base
adjustment. The legislative add-ons are currently scheduled to expire on
September 30, 2002. We estimate the average per diem effect of the legislative
add-ons to be $31.00 per day, or $19.0 million annually. Congress has not
introduced legislation to continue this funding, nor have the Centers for
Medicare and Medicaid Services recommended that this funding be continued. A
decision to discontinue all or part of the enhancements could have a significant
impact on us. The second category is "resource utilization groupings
refinements" which involved an initial 20% add-on for 15 resource utilization
groupings categories identified as having high intensity, non-therapy ancillary
services. Twenty percent add-ons from three resource utilization groupings
categories were later redistributed to 14 rehabilitation categories at an add-on
rate of 6.7% each. The resource utilization groupings refinements continue until
such time as the Centers for Medicare and Medicaid Services refine the resource
utilization groupings categories. On April 23, 2002, the Centers for Medicare
and Medicaid Services announced that they would delay the implementation of
resource utilization groupings refinements, thereby extending the related
add-ons for at least one additional government fiscal year. We estimate the
average per diem effect to us of resource utilization groupings refinements to
be $25.00 per day, or $15.0 million annually.

                                        34


Income Taxes

     Income tax benefit in 2001 was $12.5 million compared to $27.7 million in
2000. Our effective tax rate was 31.3% in 2001 as compared to 33.6% in 2000. In
assessing the reliability of deferred tax assets, we consider whether it is more
likely than not that all or some portion of the deferred tax assets will not be
realized. The ultimate realization of deferred tax assets depends upon us
generating future taxable income during the periods in which those temporary
differences become deductible. We consider the scheduled reversal of deferred
tax liabilities, projected future taxable income and tax planning strategies in
making this assessment. In 2001 and 2000 we recorded a valuation allowance of
$2.8 million and $3.2 million, respectively. The amount of the deferred tax
assets considered realizable could be reduced if estimates of future taxable
income during the carry forward period are reduced.

Asset Impairment Costs

     We are required to accrue for asset impairment costs when indicators of
impairment are present and the undiscounted cash flows from the assets do not
appear to be sufficient to recover the assets' carrying value. The impairment
loss is measured by comparing the fair value of the asset to its carrying
amount. Accordingly, we have estimated the future cash flows of each facility
and reduced the corresponding carrying value to the estimated fair value, where
appropriate. Such estimates are subject to change due to factors both within and
outside our control. If those changes reduce estimated future cash flows, we may
be required to record further impairment provisions in subsequent periods. We
recorded provisions of $1.7 million in 2001 and $20.7 million in 2000, related
to the impairment of assets.

SIGNIFICANT EVENTS IN 2001 AND 2000

     A number of significant factors adversely affected us during the past few
years, including:

     - inadequate funding levels in some states or resident classifications in
       both the Medicaid and Medicare programs;

     - fee pressures and slow payment practices exerted by health maintenance
       organizations and preferred provider organizations;

     - increased litigation settlements and insurance costs for general and
       professional liability claims;

     - increased costs incurred as a result of increased regulatory
       requirements;

     - reduced margins within the therapy and other ancillary service business;

     - increased wages and/or premiums paid to nursing assistants, domestic
       staff, temporary agencies for professional nursing staff due to the
       robust economy, general low unemployment levels and a national shortage
       of qualified nurses; and

     - increased competition in the marketplace for admissions from home care,
       assisted living facilities and hospitals.

Asset Divestitures

     In 2001, we transferred all of our Texas nursing home operations to
affiliates of Senior Health Properties-Texas, Inc. The transaction involved 17
nursing homes, with a capacity of 1,421 residents. We now lease four of these
facilities to Senior Health-Texas under a five-year lease, which will expire in
September 2006, and sublease 12 of these facilities to Senior Health-Texas under
an eleven-year sublease, which will expire in February 2012. The final property
was sublet for one month to a Senior Health-Texas affiliate until October 31,
2001, the remainder of the lease term. The Senior Health-Texas affiliate
transferred the operations of this final property to an unrelated third party
and terminated its leasehold interest on November 1, 2001. We receive annual
rental income from the properties of approximately $3.8 million, which is $1.8
million more than our current annual lease costs. Our annual rental income will
escalate in alignment with the increases in rent expense under the existing
leases and in alignment with

                                        35


improvements in operating income for the owned facilities. Senior Health-Texas
has a right of first refusal with respect to any offer to purchase one or more
of the four owned facilities.

     In April 2001, Tandem Health Care, Inc. exercised its option to purchase
two leased properties in Florida. Upon Tandem's exercise of its option, we
received gross proceeds of $11.4 million, consisting of cash of $7.0 million, a
$2.5 million 8.5% interest-bearing five-year note and $1.9 million in 9%
cumulative dividend preferred shares, mandatorily redeemable after five years.
The carrying value of the two facilities on our books was $9.2 million. The gain
on sale of $2.1 million has been deferred in accordance with Statement of
Financial Accounting Standards, or SFAS, Statement No. 66, "Accounting for Sales
of Real Estate," because we have not received a significant portion of the
proceeds and the ultimate determination of the gain depends on Tandem exercising
all its remaining options. We applied $4.0 million of the net proceeds to reduce
our term bank debt. Tandem continues to operate seven of the nursing homes under
a lease agreement with us and has an option to purchase these facilities from us
at any time during the lease term, which ends June 30, 2002.

     In 2000, we disposed of or leased all 32 of our facilities with 3,427 beds
in Florida through a series of transactions. We sold two Florida nursing
facilities in separate transactions in July and December 2000. In September
2000, we entered into an agreement involving 15 facilities with Greystone
Tribeca Acquisition LLC in which we retain an interest in the properties through
the contingent consideration terms of the agreement. This particular
transaction, while not accounted for as a sale, resulted in initial net cash
proceeds of $30.0 million. In December 2000, we transferred the operations and
leased the properties of nine Florida facilities to Tandem and of six Florida
facilities to Senior Health Properties-South, Inc. Under the leases, the Tandem
and Senior Health Properties-South have options to purchase their respective
properties. We also sold two formerly closed facilities, which together with the
Florida divestitures, resulted in total cash proceeds of $37.7 million, of which
$33.1 million was used to reduce our bank debt. The dispositions, in addition to
provisions for the closure of two nursing and one assisted living facilities and
provisions for other non-core assets, resulted in a total loss from the
disposition of assets of $6.7 million in 2000.

     We have recorded provisions for all estimated future costs related to
operations that we disposed of. Those estimates were made at the time of
disposition and can be subject to revisions which may impact our future
earnings.

     As a result of the divestiture programs in Florida and Texas, we received,
in addition to cash proceeds, notes and preferred shares, retained ownership of
certain nursing home properties and entered into on-going consulting service
agreements with operators in these two states. As of December 31, 2001, we:

     - held an aggregate of $8.4 million in notes and preferred shares from
       Tandem;

     - owned 13 leased nursing home properties in Florida and four leased
       nursing home properties in Texas with a net book value of $41.6 million;
       and

     - subleased 12 properties in Texas to another long-term care operator.

     Of the 13 Florida leases, seven expire on June 30, 2002, and six expire in
December 2005. The Texas leases expire in September 2006 and the Texas subleases
expire in February 2012. In addition, we provide on-going management and
consulting services to and earn rental income from the operators of these
facilities. As of December 31, 2001, we had $9.2 million in accounts receivable
from long-term care operators for whom we provided management and consulting
services, which included interim working capital advances related to the
transfer of ownership. As a result, our earnings and cash flow can be influenced
by the financial stability of these unrelated companies.

Other Items

     In April 2000, the Provider Reimbursement Review Board heard our appeal
involving workers' compensation costs reimbursements. In December 2000, the
administrator for the Centers for Medicare and Medicaid Services confirmed the
review board's September 2000 decision resulting in a favorable settlement of
$12.4 million, including the recovery of a $10.3 million accrual recorded in
1999. In addition,

                                        36


we reached a settlement on another staffing cost issue resulting in a recovery
of $2.4 million, including a recovery of a $1.7 million accrual recorded in
1999. In total, a recovery of $12.0 million was recorded in 2000 relating to
accruals recorded in 1999.

     At December 31, 2001, we were attempting to settle a number of outstanding
Medicare and Medicaid receivables. Normally such issues are resolved during an
annual audit process and no provisions are required. However, where differences
exist between us and the fiscal intermediary, we may record a general provision.
For two specific Medicare issues, totaling an estimated $22.1 million, we and
the fiscal intermediary have agreed that if the parties do not resolve the issue
in 2002, then the parties and a mediator will review the matters prior to either
party proceeding to the Provider Reimbursement Review Board. The two issues
involve the allocation of overhead costs and a staffing cost issue. Though we
remain confident that we will successfully settle the issues, an unsuccessful
conclusion could impair our earnings and anticipated cash flow.

RESULTS FROM OPERATIONS:

     The following table sets forth details of our revenues and earnings as a
percentage of total revenues:



                                                          THREE MONTHS
                                                        ENDED MARCH 31,         YEAR ENDED DECEMBER 31
                                                        ----------------      ---------------------------
                                                        2002       2001       2001       2000       1999
                                                        -----      -----      -----      -----      -----
                                                                                     
Revenues
  Nursing and assisted living facilities............     96.3%      96.4%      96.6%      98.0%      94.7%
  Outpatient therapy and medical supplies...........      1.2        1.2        1.2        1.1        4.5
  Other.............................................      2.5        2.4        2.2        0.9        0.8
                                                        -----      -----      -----      -----      -----
                                                        100.0      100.0      100.0      100.0      100.0
Operating and general and administrative costs......     88.2       92.3       90.3       94.5       92.0
Lease, depreciation and amortization................      6.3        7.3        7.0        6.6        7.1
Interest, net.......................................      4.0        5.1        4.5        4.9        5.3
Loss on impairment of long-lived assets.............       --         --        0.2        2.2        3.9
Loss on disposal of assets and other items..........       --        0.7        3.1        0.7        4.4
                                                        -----      -----      -----      -----      -----
  Earnings (loss) before taxes......................      1.5       (5.4)      (5.1)      (8.9)     (12.7)
Income tax expense (benefit)........................      0.7       (1.9)      (1.6)      (3.0)      (5.5)
                                                        -----      -----      -----      -----      -----
  Earnings (loss) before minority interests and
     extraordinary item.............................      0.8       (3.5)      (3.5)      (5.9)      (7.2)
Extraordinary item..................................       --         --         --       (0.1)        --
                                                        -----      -----      -----      -----      -----
     Net (loss) earnings............................      0.8%      (3.5)%     (3.5)%     (6.0)%     (7.2)%
                                                        =====      =====      =====      =====      =====


     Average occupancy in our long-term care facilities was as follows:



                                                          THREE MONTHS
                                                        ENDED MARCH 31,         YEAR ENDED DECEMBER 31
                                                        ----------------      ---------------------------
                                                        2002       2001       2001       2000       1999
                                                        -----      -----      -----      -----      -----
                                                                                     
Skilled nursing facilities..........................    89.5%      87.1%      87.5%      87.5%      85.9%
Assisted living facilities..........................    81.8%      84.3%      83.1%      84.6%      80.3%


THREE MONTHS ENDED MARCH 31, 2002 COMPARED WITH THREE MONTHS ENDED MARCH 31,
2001

Revenues

     Revenues in the three months ended March 31, 2002 were $198.2 million,
representing an increase of $4.8 million, or 2.5%, from $193.4 million in the
three months ended March 31, 2001. The increase in revenues includes a $15.4
million increase in revenues from nursing and assisted living facilities and
other businesses operated during both the 2002 and the 2001 quarters ("same
facility operations") and an

                                        37


increase of $0.4 million from lease revenue, partially offset by a decrease of
$11.0 million in revenues from divested nursing facilities.

     Revenues from same-facility operations increased $15.4 million due to:

     - an increase of $15.0 million, or 8.6%, as a result of an overall higher
       percentage of Medicare residents and increased rates, aided by a 0.9%
       increase in resident census from an average daily census of 13,931 in
       2001 to 14,054 in 2002;

     - an increase of $0.3 million when comparing periods due to more favorable
       Medicaid cost settlements in 2002; and

     - an increase of $0.1 million from other business operations.

     Our key Medicare and Medicaid results and statistics for our nursing
operations on a same-facility basis in the first quarter of 2002 and 2001 are
summarized as follows:



                                                   MEDICARE                               MEDICAID
                                       --------------------------------      ----------------------------------
                                         THREE MONTHS ENDED MARCH 31,           THREE MONTHS ENDED MARCH 31,
                                       --------------------------------      ----------------------------------
                                        2002        2001       INCREASE       2002        2001        INCREASE
                                       ------      ------      --------      ------      ------      ----------
                                                                                   
Average daily rate...............      $  337      $  315        7.0%        $  125      $  118         5.9%
Residents as a percent of
  total..........................       13.0%       11.7%                     68.6%       69.3%
Average daily census.............       1,640       1,455       12.7%         8,653       8,618         0.4%


Operating and General and Administrative Costs

     Operating and general and administrative costs decreased $3.7 million, or
2.1%, between periods. Operating and general and administrative costs decreased
$10.8 million relating to operations closed or nursing homes divested. The
increase in operating and general and administrative costs on a same-facility
was $7.1 million, or a 4.2% increase on a same-facility basis, and included:

     - an increase in wage and benefit costs of $5.2 million, or a 4.6% increase
       on a same-facility basis;

     - an increase in contracted food and laundry services totaling $1.3 million
       relating to services that were formerly provided by employees; and

     - a net increase in other operating and administrative expenses of $0.6
       million.

Lease Costs, Depreciation and Amortization

     Lease costs decreased $0.8 million when comparing periods, including $0.6
million as a result of divestitures and $0.2 million as a result of continuing
operations.

     Depreciation and amortization decreased $0.9 million to $9.4 million for
the 2002 quarter compared to $10.3 million for the 2001 quarter. This decrease
included a $0.4 million decrease as a result of divestitures and a $0.6 million
decrease relating to the adoption of SFAS No. 142, "Goodwill and Other
Intangible Assets," which requires that goodwill no longer be amortized to
earnings.

Interest

     Interest expense, net of interest income, decreased $1.9 million to $8.0
million for the 2002 quarter compared to $9.9 million in the 2001 quarter. The
decrease was primarily due to a reduction in the average debt level to $384.0
million during the 2002 quarter compared to $439.7 million during the 2001
quarter resulting from our use of divestiture proceeds and income tax refund
during 2001 to reduce bank debt balances. The weighted average interest rate of
all long-term debt decreased to 7.82% during the 2002 quarter compared to
approximately 8.58% during the 2001 quarter.

Gain (Loss) on Disposal of Assets and Other Items

     A loss of $1.4 million was recorded in the 2001 quarter for costs relating
to the disposal or lease during 2000 of our Florida operations.

                                        38


Income Taxes

     Income tax expense in the 2002 quarter was $1.3 million compared to an
income tax benefit of $3.7 million in the 2001 quarter. Our effective tax rate
was 43.9% in 2002 as compared to 35.3% in 2001. The increase is due to an
increase in effective state income tax rates.

Net Earnings (Loss)

     Net earnings in the 2002 quarter were $1.7 million compared to a net loss
of $6.8 million in the 2001 quarter. The net loss prior to loss on disposal of
assets and other items was $5.8 million for the 2001 quarter.

YEAR ENDED DECEMBER 31, 2001 COMPARED WITH YEAR ENDED DECEMBER 31, 2000

Revenues

     Revenues for the year ended December 31, 2001 were $794.1 million,
representing a decrease of $129.0 million, or 14.0%, from $923.1 million for the
year ended December 31, 2000. The decrease in revenues is attributable to:

     - a decrease of $154.6 million, relating to the divestiture of nursing and
       assisted living facilities primarily in Florida and Texas;

     - the one-time recovery of $8.9 million in revenue in 2000 on a
       same-facility basis pertaining to the settlement of the workers
       compensation issue through the Provider Reimbursement Review Board and
       the staffing cost issue with the fiscal intermediary; and

     - a decrease of $0.4 million from outpatient therapy divestitures in 2000,

offset in part by an increase of $3.6 million from new management services
contracts and an increase of $31.3 million in revenue from nursing and assisted
living facilities and other businesses operated during both 2001 and 2000.

     Revenues from same-facility operations increased $31.3 million in 2001 due
to:

     - a $33.5 million increase, or a 4.8% increase on a same-facility basis,
       from increased rates, partially offset by a 0.9% decline in overall
       resident census from an average daily census of 14,055 in 2000 to an
       average daily census of 13,928 in 2001;

     - a $1.5 million decrease due to more favorable Medicaid cost settlements
       in 2000;

     - a $1.4 million decrease as a result of the accrual in 2000 for blood
       glucose revenue for the period of October 1, 1997 through December 31,
       2000 due to favorable rulings regarding reimbursement litigation with our
       fiscal intermediary; and

     - a $0.7 million increase from other business operations.

     Our key Medicare and Medicaid results and statistics for our nursing
operations on a same-facility basis in 2001 and 2000 are summarized as follows:



                                                                                          MEDICAID
                                                   MEDICARE                  ----------------------------------
                                       --------------------------------                               INCREASE
                                        2001        2000       INCREASE       2001        2000       (DECREASE)
                                       ------      ------      --------      ------      ------      ----------
                                                                                   
Average daily rate...............      $  334      $  316        5.7%        $  121      $  115         4.5%
Residents as a percent of
  total..........................       11.4%       10.7%                     69.6%       70.2%
Average daily census.............       1,427       1,341        6.4%         8,676       8,812        (1.5%)


     Overall, our average daily Medicare rate increased 3.7% to $333 during 2001
compared to $321 during 2000, and our average daily Medicaid rate increased 4.5%
to $117 in 2001 compared to $112 in 2000.

                                        39


Operating and General and Administrative Costs

     Operating and general and administrative costs in 2001 decreased $154.5
million, or 17.7%, as compared to 2000. The decrease was caused by a $49.5
million decrease in expenses for insurance and liability claims, primarily
relating to our disposal of our Florida operations, and a $134.7 million
reduction in operating costs, other than insurance and liability claims,
attributable to operations closed or nursing facilities divested during 2001 and
2000. The increase in operating and general and administrative costs on a
same-facility basis, excluding expenses for insurance and liability claims, was
$29.7 million, a 4.7% increase on a same-facility basis. The increase is
attributable to:

     - an increase in wage and benefit costs of $29.8 million, a 6.9% increase
       on a same-facility basis;

     - an increase in drug expense of $2.4 million primarily due to settlement
       of 1999 contracted drug charges in 2001;

     - an increase in utility costs of $1.1 million due to higher rates in 2001;

     - a decrease in workers' compensation costs of $3.1 million due to
       favorable actuarial adjustments for prior years in 2001;

     - a decrease in bad debt expense of $2.4 million; and

     - a net increase in other operating and administrative expenses of $2.0
       million, or a 0.3% increase on a same-facility basis.

     We had $70.3 million in accruals for known or potential general and
professional liability claims at December 31, 2001 based upon claims experience
and actuarial estimates. Though we regularly evaluate these accruals and we
believe they are fairly stated, the accruals are subject to adjustment, which
could have a material impact on our earnings. The timing of the settlement of
the claims could influence cash flow and our ability to meet financial covenants
under our existing credit facility or the new credit facility.

     In 1998, we sold our pharmacy operations to Omnicare, Inc. In connection
with that sale, we entered into a preferred provider agreement with Omnicare.
Under the terms of this preferred provider agreement, Omnicare pharmacies are
required to execute pharmacy service agreements and pharmacy consulting
agreements to provide pharmacy supplies and services to all of our skilled
nursing facilities. Pricing under the agreement is to be competitive within the
local marketplace. Omnicare may not charge us rates that are higher than the
most favorable rates that Omnicare charges for similarly situated beneficiaries
in the same marketplace. We secured per diem pricing arrangements for pharmacy
supplies provided to residents with managed care and Medicare payor sources for
the first four years of the agreement, which period expires in December 2002.
The preferred provider agreement contains a number of provisions that involve
sophisticated calculations to determine the per diem pricing during this first
four-year period. Under a per diem pricing agreement pharmacy costs fluctuate
based upon occupancy levels in the facilities. The per diem rates were
established assuming a declining per diem value over the initial four years of
the contract to coincide with the phase-in of the Medicare prospective payment
system rates.

     We are presently involved in an arbitration with Omnicare regarding the
application of the managed care pricing provisions in 2001 and 2002. Omnicare
has asserted that per diem rates for managed care and Medicare beneficiaries are
subject to an upward adjustment based upon a comparison of per diem rates to
pricing models based on Medicaid rates. The arbitrator determined that a pricing
adjustment is applicable, but also approved our motion to reopen and reconsider
that determination. We and Omnicare are also attempting to resolve
implementation issues related to the application of the adjustment formula to
pricing data. We do not expect the arbitration decision to materially affect our
results of operations or our financial position.

     Omnicare has indicated that it intends to make similar claims for Medicare
residents for a similar time period. Provisions for settlement of the claims are
included within the financial statements. We believe we have properly
interpreted and complied with the terms of the preferred provider agreement;
however, we cannot assure you that other claims will not be made with respect to
the agreement.

                                        40


     We record a provision for bad debts in relation to revenues recorded based
upon our past experience and we believe our reserves are adequate. We
continually review and refine our reserve estimation process and the adequacy of
our reserve, but we cannot guarantee that our estimates accurately reflect the
future credit losses that we may incur and therefore our estimates can be
subject to future adjustments.

Lease Costs, Depreciation and Amortization

     Lease costs decreased $1.2 million from 2000 to 2001. We lease seven
nursing homes in Indiana and Ohio and, in accordance with the lease agreement,
exercised our right to purchase the properties in September 2000. However,
negotiations with the landlord have not been successfully concluded and the
matter may need to go to arbitration. We believe that we will successfully
settle this issue and acquire these leased facilities. The net book value of the
leased facilities is $4.2 million, and the 2001 earnings from their operations
were approximately $2.2 million.

     Depreciation and amortization decreased $4.7 million to $40.8 million in
2001 compared to $45.5 million in 2000. This decrease included a $1.4 million
decrease as a result of divestitures and a $3.3 million decrease from
same-facility operations as a result of assets becoming fully depreciated and
reduced depreciation relating to losses recorded in 2001 and 2000 for impairment
of depreciable assets.

Interest

     Interest expense, net of interest income, decreased $9.6 million to $35.6
million in 2001 compared to $45.2 million in 2000. The decrease was primarily
due to a reduction in our average debt level to $406.5 million during 2001
compared to $478.3 million during 2000, resulting from our use of divestiture
proceeds and income tax refunds during both years to reduce our bank debt. The
weighted average interest rate of all long-term debt decreased to approximately
9.31% during 2001 compared to approximately 9.73% during 2000 due to an overall
decline in interest rates.

Loss on Impairment of Long-Lived Assets

     When we commit to a plan for disposal of assets, assets held for disposal
are adjusted to the lower of the assets' carrying value or the fair value less
selling costs. In September 2001, we decided to lease all owned, and sublease
all leased, nursing facilities in Texas. As a result of the transaction and
based on the terms of the lease with Senior Health-Texas, in 2001 we recorded a
provision of $1.7 million for impairment of Texas nursing properties in
accordance with SFAS No. 121, "Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to Be Disposed Of."

     In December 2000, we decided to sell or lease all of our remaining
operations in Florida and completed two transactions to accomplish that
decision. Both transactions resulted in providing the two operators with an
option to purchase the properties within the lease term. In December 2000, we
recorded a provision of $15.9 million for impairment of Florida properties and
reported within the loss from disposal of assets a provision of $1.1 million for
costs related to the termination of our Florida operational staff. In addition,
in December 2000, we determined that a $4.8 million adjustment was required for
non-Florida properties resulting in a total impairment provision for 2000 of
$20.7 million.

Loss on Disposal of Assets and Other Items

     A loss of $24.2 million was recorded in 2001 for the disposal or closure of
facilities and settlements of previously ceased operations. On September 30,
2001, we transferred all Texas nursing homes to Senior Health-Texas. As a result
of the Texas transaction, as well as the closure and sale of one nursing home
and two other properties in Wisconsin, we provided $3.7 million for related
disposal and closure costs. We also made additional provisions of $20.5 million
relating to previously ceased operations, including $19.0 million related to the
nursing facilities in Florida. Based upon an actuarial review of resident care
liability costs, we recorded an additional $11.0 million provision related to
Florida claims for years prior to 2001.

                                        41


     In 2000, we disposed or leased all of our operations in Florida consisting
of 32 facilities with 3,427 beds through a series of transactions, two of which
involved lease agreements with operators who have an option to purchase the
properties and one in which we retain an interest in the properties through the
contingent consideration terms of the agreement. In addition, we sold two
formerly closed facilities. In the aggregate these five transactions, along with
other asset sales, resulted in cash proceeds of $37.7 million, of which $33.1
million was applied to reduce our debt. The sale or lease of the Florida
facilities, associated costs in exiting Florida and the loss from the
disposition of the two formerly closed facilities resulted in a pre-tax loss of
$4.0 million. In addition, we provided $1.7 million for the closure of two
nursing and one assisted living facilities and $1.0 million for the disposition
of other non-core assets. Total losses for 2000 from the disposal of assets and
other items totaled $6.7 million.

Income Taxes

     We have recorded a financial statement benefit for federal and state tax
losses and other deferred tax assets based upon our future anticipated taxable
earnings. As of December 31, 2001, the valuation allowance was $6.9 million,
primarily relating to state net operating losses to reflect limited carry
forward periods and reductions in various states apportionment. The allowance
was increased by $2.8 million in 2001 and $3.2 million in 2000.

Extraordinary Item

     The extraordinary loss in 2001 of $45,000, net of income tax effect, is
related to the write-off of deferred financing costs in connection with debt
reduction with the proceeds of sales of nursing facilities. The extraordinary
loss in 2000 of $0.4 million, net of income tax effect, is related to the
write-off of deferred financing costs in connection with the repayment of debt
repayment upon the sale of nursing and assisted living facilities and upon
receipt of an income tax refund.

Net Loss

     The net loss in 2001 was $27.5 million compared to a net loss of $55.1
million in 2000. The net loss prior to loss on disposal of assets and other
items, loss on impairment of long-lived assets and extraordinary item, after
applicable income tax effect, was $11.0 million for 2001 compared to a
comparable net loss of $37.1 million for 2000 due to the changes noted above.

YEAR ENDED DECEMBER 31, 2000 COMPARED WITH YEAR ENDED DECEMBER 31, 1999

Revenues

     Revenues for the year ended December 31, 2000 were $923.1 million,
representing a decrease of $44.5 million, or 4.6%, from $967.6 million for the
year ended December 31, 1999. The $44.5 million decrease in revenues includes a
$33.4 million decrease in outpatient therapy and medical supplies revenues due
to the divestiture of the home health operations and contracted therapy
operations in 1999 and 2000 and a decrease of $85.1 million from nursing and
assisted living facility divestitures, net of the opening of newly constructed
facilities. These decreases were partially offset by a $74.0 million increase in
revenue from facilities operated during each of the years.

     Revenues from same-facility operations increased $74.0 million due to:

     - a $27.4 million reduction in revenue recorded in 1999 relating to a
       general provision for disputed Medicare receivables based on cost reports
       filed for 1995 to 1998;

     - a $12.0 million increase in revenue in 2000 relating to two disputed
       Medicare receivable issues, which were provided for in 1999 and settled
       in favor of the Company;

     - a favorable ruling for the billing of blood glucose claims for the period
       of October 1, 1997 through December 31, 2000, which resulted in a $3.6
       million revenue increase in 2000; and

                                        42


     - an additional $31 million of revenues, or a 4.6% increase on a
       same-facility basis, due to improvements in census and increased Medicaid
       rates, partially offset by the decline in Medicare rates.

     Our average daily Medicaid rate increased to $112 in 2000 compared to $106
in 1999 and the percent of Medicaid-related revenue to total revenues increased
slightly to 51% in 2000 from 50% in 1999. In 1999, the average rate for Medicare
Part A services was approximately $323 per patient day as compared to the
average of $304 per patient day in 2000. The percentage of Medicare patients in
skilled nursing facilities increased to 10.9% in 2000 from 10.8% in 1999, and
during 2000 the total number of Medicare patient days was 649,000. The percent
of Medicare-related revenue to total revenues increased to 24% in 2000 from 22%
in 1999.

Operating and General and Administrative Costs

     Operating and general and administrative costs in 2000 decreased $18.4
million or 2.1% compared to 1999, of which $47.7 million related to costs saved
from the closing of operations or divestitures of nursing homes in 1999 and
2000, net of newly constructed facilities. The increase in operating and general
and administrative costs on a same-facility basis was $29.3 million, a 4.7%
increase on a same-facility basis, and included:

     - an increase in wage-related costs of $19.0 million;

     - an increase in workers' compensation costs of $5.7 million due to higher
       premiums in 2000 and more favorable actuarial adjustments in 1999 as
       compared to 2000;

     - an increase in insurance expense and liability claim provisions of $6.3
       million due to increased premiums and adverse experience; and

     - an increase in bad debt expense of $2.2 million, partially offset by a
       $3.9 million decrease, or a 0.6% decrease on a same-facility basis, in
       other operating and administrative expenses.

Lease costs, Depreciation and Amortization

     Total lease costs and depreciation and amortization decreased $7.5 million
in 2000 compared to 1999. Lease costs decreased by $0.9 million as a result of
divestitures. Depreciation and amortization expense decreased $6.6 million also
due to divestitures.

Interest

     Interest expense, net of interest income, decreased $6.1 million to $45.2
million in 2000 compared with $51.3 million in 1999. The decrease was primarily
due to a reduction in the average debt level to $478.3 million during 2000
compared to $575.5 million during 1999 resulting from our use of divestiture
proceeds and our income tax refund to reduce our bank debt. This decrease was
partially offset by an increase in the weighted average interest rate of all
long-term debt to approximately 9.73% during 2000 compared to approximately
9.12% during 1999.

Loss on Impairment of Long-Lived Assets

     Loss on impairment of long-lived assets decreased to $20.8 million for 2000
from $38.2 million for 1999 for the reasons discussed below.

     We record impairment losses recognized for long-lived assets used in
operations when indicators of impairment are present and the estimated
undiscounted cash flows do not appear to be sufficient to recover the assets'
carrying amounts. The impairment loss is measured by comparing the fair value of
the asset to its carrying amount. In addition, once management has committed the
organization to a plan for disposal, assets held for disposal are adjusted to
the lower of the assets' carrying value and its fair value less costs to sell.
Accordingly, we have estimated the future cash flows of each facility and
reduced the carrying value to its estimated fair value.
                                        43


     In December 2000, we decided to sell or lease all of our remaining
operations in Florida and completed two transactions to accomplish that
decision. Both transactions resulted in providing the two operators with an
option to purchase the properties within the lease term. In December 2000, we
recorded a provision of $15.9 million for impairment of Florida properties and
reported within the loss from disposal of assets a provision of $1.1 million for
costs related to the termination of our Florida operational staff. In addition,
in December 2000, we determined that a $4.8 million adjustment was required for
non-Florida properties resulting in a total impairment provision for 2000 of
$20.7 million.

     In the fourth quarter of 1999, we completed an evaluation of the financial
impact of changes in the insurance marketplace, increased costs resulting from
changes in legislation and regulatory scrutiny and decreased Medicare rates. As
a result of that evaluation we recorded an aggregate provision for impairment of
goodwill, property and equipment of $38.2 million, of which all but $3.9 million
related to facilities or assets located in Florida.

Loss on Disposal of Assets and Other Items

     In 2000, we disposed or leased all of our operations in Florida consisting
of 32 facilities with 3,427 beds through a series of transactions, two of which
involved lease agreements with operators who have an option to purchase the
properties and one in which we retain an interest in the properties through the
contingent consideration terms of the agreement. In addition, we sold two
formerly closed facilities. In the aggregate these five transactions, along with
other asset sales, resulted in cash proceeds of $37.7 million, of which $33.1
million was applied to reduce our debt. The sale or lease of the Florida
facilities, associated costs in exiting Florida and the loss from the
disposition of the two formerly closed facilities resulted in a pre-tax loss of
$4.0 million. In addition, we provided $1.7 million for the closure of two
nursing and one assisted living facilities and $1.0 million for the disposition
of other non-core assets. Total losses for 2000 from the disposal of assets and
other items totaled $6.7 million.

     In 1999, we sold six nursing facilities and our home health operation for
$62.3 million, resulting in a pre-tax loss of $37.0 million. We also made a
number of provisions for the closure of nursing facilities, additional costs
related to the sale of non-core assets and severance of non-essential personnel
to result in an overall pre-tax loss of $42.8 million. We applied the net
after-tax proceeds from these dispositions to reduce debt by approximately $44.8
million. Six of the facilities sold in 1999 were skilled nursing facilities in
Florida which were sold through the sale of a subsidiary in the fourth quarter.
That sale resulted in a pre-tax loss of $35.9 million and a current tax benefit
of $29.0 million relating to the recovery of prior years taxes.

Start-up Costs

     We had start-up losses in 2000 associated with newly constructed facilities
opened in 1999 of $1.0 million compared to $4.1 million in 1999. There were no
new facilities opened during 2000.

Income Taxes

     Income tax expense for 2000 was a $27.7 million benefit as compared to a
$52.8 million benefit in 1999. Our effective tax rates were 33.7% in 2000 as
compared to 42.9% in 1999. The benefit was less in 2000 due to the recovery of
taxes resulting from the disposition of nursing facilities through the share
transaction in 1999 (see note 4 to the Consolidated Financial Statements).

Extraordinary Item

     The extraordinary loss from early retirement of debt, net of income tax
effect, increased to $442,000 for 2000 from $342,000 for 1999. Both amounts
relate to the write-off of deferred financing costs in connection with repayment
of debt with the proceeds of sales of nursing and assisted living facilities.

                                        44


Net Loss

     The net loss for 2000 was $55.1 million compared to a net loss of $70.5
million for 1999. The net loss prior to loss on impairment of long-lived assets,
loss on disposal of assets and other items and extraordinary item, after
applicable income tax effect, was $37.1 million for 2000 compared to a
comparable net loss of $27.5 million for 1999.

LIQUIDITY AND CAPITAL RESOURCES

Overview of Changes in Liquidity -- Three Months Ended March 31, 2002 Compared
To Three Months Ended March 31, 2001

     We had cash and cash equivalents of $3.0 million at March 31, 2002 and $1.0
million at December 31, 2001. We generated cash flow of $10.4 million from
operating activities for the three months ended March 31, 2002 compared with
$20.1 million in the comparable period of 2001.

     Our working capital, excluding cash and borrowings included in current
liabilities, decreased $6.6 million from $15.8 million at December 31, 2001 to
$9.2 million at March 31, 2002. The decrease resulted primarily from a decrease
in accounts receivable of $4.2 million and a $7.9 million increase in accounts
payable and accrued liabilities. These decreases in working capital were
partially offset by a $0.5 million increase in taxes recoverable, a $0.3 million
increase in supplies, inventories and prepaid expense and a $4.7 million
decrease in due to shareholders and affiliates.

     Accounts receivable at March 31, 2002 were $100.0 million compared with
$104.2 million at December 31, 2001, representing a decrease of $4.2 million.
The reduction in accounts receivable included a $6.0 million decrease within the
nursing operations, an increase of $0.7 million within the outpatient therapy
operations and a $1.1 million increase in receivables from long-term care
operators for which we provide management and consulting services. The $1.1
million increase was primarily attributable to transitional working capital
advances to the nursing facilities transferred to Senior Health-Texas and Senior
Health-South. Within the nursing operations, billed patient care and other
receivables decreased $7.4 million while third-party payor settlement
receivables, based on Medicare and Medicaid cost reports, increased $1.4
million. The decrease in billed patient care receivables of $7.4 million
included a decrease of $10.5 million due to our improved collection efforts. The
remaining increase of $3.1 million reflects an increase of $4.2 million due to
rate increases, partially offset by a decrease of $1.1 million due to the sale
or closure of nursing facilities and assisted living facilities.

     The increase in settlement receivables of $1.4 million from December 31,
2001 to March 31, 2002 included increases of $1.2 million in revenue recorded in
2002 as a result of Medicaid cost report settlements and $1.0 million in revenue
recorded in 2002 for anticipated Medicare reimbursement for uncollectible
co-insurance amounts. These increases were partially offset by a decrease of
$0.8 million for collections from Medicare of uncollectible co-insurance amounts
recorded as revenue in 2001.

     Property and equipment decreased $6.2 million from December 31, 2001 to a
total of $471.6 million at March 31, 2002. The decrease was the result of
depreciation expense of $9.1 million and asset disposals of $0.9 million. These
decreases were partially offset by capital expenditures of $3.1 million and an
increase of $0.7 million as a result of the reclassification of the net book
value of property and equipment related to the disposal of nursing facilities to
Greystone from other assets to Property and equipment.

     Total borrowings, including bank indebtedness and both current and
long-term maturities of debt, totaled $377.0 million at March 31, 2002. This
represents a decrease of $8.9 million from December 31, 2001. The decrease
resulted from the use of $0.8 million of proceeds from the collection of notes
receivables, $1.5 million of proceeds from the sale of property and the use of
cash from operating activities to reduce borrowings. The weighted average
interest rate of all of our long-term debt was 7.15% at March 31, 2002 and such
debt had maturities ranging from 2002 to 2014.

     As of March 31, 2002, our parent, Extendicare Inc., and/or one of its
wholly owned subsidiaries held $27.9 million, or 14.0%, of our outstanding
senior subordinated notes.

                                        45


     Cash used by investing activities was $0.3 million for the three months
ended March 31, 2002 compared to $2.5 million in the comparable period of 2001.
The decrease was primarily due to our receipt of $1.7 million in proceeds from
the sale of property and equipment in 2002 and $0.9 million from the collection
of notes receivable in 2002.

     Cash used for financing activities decreased by $9.7 million to $8.1
million for the three months ended March 31, 2002 compared to $17.8 million in
the comparable period of 2001. The decrease is primarily due to:

     - an $11.0 million increase in proceeds from issuance of long-term debt;

     - a $1.9 million increase in cash provided by bank indebtedness;

     - a $1.7 million increase in other liabilities in 2002; and

     - an increase of $4.9 million in payments of long-term debt in 2002.

Overview of Changes in Liquidity -- Year Ended December 31, 2001 Compared To
Year Ended December 31, 2000

     We had cash and cash equivalents of $1.0 million at December 31, 2001 and
$1.6 million at December 31, 2000. Cash flow generated from operating activities
was $75.9 million for 2001 compared with $32.8 million in 2000.

     We experienced a decrease in working capital, excluding cash and borrowings
included in current liabilities, of $40.3 million from $56.1 million at December
31, 2000 to $15.8 million at December 31, 2001. The decrease in working capital
resulted primarily from a decrease in taxes recoverable of $14.1 million, a
decrease in accounts receivable of $25.8 million and a $2.6 million decrease in
inventories, supplies and prepaid expense, the majority of which were converted
to cash to reduce borrowings. These decreasing components of working capital
were partially offset by a $1.7 million decrease in accounts payable and accrued
liabilities and a $0.6 million decrease in due to shareholders and affiliates.

     Current and deferred taxes recoverable decreased from $33.5 million at
December 31, 2000 to $19.4 million at December 31, 2001, representing a decrease
of $14.1 million. The decrease was due to a tax refund of $22.5 million,
partially offset by a current year tax benefit of $0.6 million, a 2000 return
versus close adjustment of $7.5 million and payments of $0.3 million.

     Accounts receivable at December 31, 2001 were $104.2 million compared with
$130.0 million at December 31, 2000, representing a decrease of $25.8 million.
The reduction in accounts receivable included a $32.3 million decrease within
the nursing operations, a decrease of $1.8 million within the outpatient therapy
operations and an $8.3 million increase in receivables from long-term care
operators for which management and consulting services are provided. The $8.3
million increase was primarily attributable to transitional working capital
advances to the nursing facilities transferred to Senior Health-Texas and Senior
Health-South. Within the nursing operations, billed patient care and other
receivables decreased $28.5 million and third-party payor settlement receivables
decreased $3.8 million. The decrease in billed patient care receivables of $28.5
million included a decrease of $17.3 million due to an improvement in our
collection efforts between periods. The remaining decrease of $11.2 million
reflects a decrease of $17.1 million due to the sale or closure of nursing
facilities and assisted living facilities, partially offset by an increase of
$5.9 million due to rate increases.

     The decrease in settlement receivables of $3.8 million from December 31,
2000 to December 31, 2001 is attributable to:

     - the collection of a Pennsylvania Medicaid $4.8 million settlement
       recorded as revenue in 2000;

     - the collection of $2.2 million as a result of Medicaid settlements;

                                        46


     - collections from Medicare of $3.7 million of uncollectible co-insurance
       amounts recorded as revenue in 2000; and

     - $1.8 million received as a result of Medicare cost report settlements.

These collections were partially offset by:

     - $4.0 million in additional revenue recorded in 2001 as a result of
       Medicaid cost report settlements;

     - $3.9 million in additional revenue recorded 2001 for anticipated Medicare
       reimbursement for uncollectible coinsurance amounts; and

     - an $0.8 million increase in settlement receivables as a result of the
       reclassification of settlements from long-term accounts receivable to
       current.

     Property and equipment decreased $29.7 million from December 31, 2000 to a
total of $477.8 million at December 31, 2001. The decrease was the result of
depreciation expense of $36.6 million, asset disposals of $10.5 million and
asset write-downs of $1.7 million. These decreases were partially offset by
capital expenditures of $16.3 million and an increase of $2.8 million as a
result of the reclassification of the net book value of property and equipment
related to the disposal of nursing facilities to Greystone from other assets to
property and equipment.

     Total borrowings, including bank indebtedness and both current and
long-term maturities of debt, totaled $385.9 million at December 31, 2001,
representing a decrease of $65.7 million from December 31, 2000. The decrease
was attributable to the use of $22.5 million from a tax refund, $4.0 million
from the sale of nursing facilities and the use of cash from operating
activities to reduce borrowings. The weighted average interest rate of all
long-term debt was 6.92% at December 31, 2001 and such debt had maturities
ranging from 2002 to 2014.

     During 2001, our parent, Extendicare Inc., and/or one of its wholly owned
subsidiaries acquired $19.0 million of our senior subordinated notes. As of
December 31, 2001, Extendicare Inc. and/or one of its wholly owned subsidiaries
held $27.9 million, or 14.0%, of the outstanding senior subordinated notes.

     Cash used in investing activities was $10.1 million for 2001 compared to
$50.5 million provided by investing activities in 2000. The decrease was
primarily due to:

     - a $29.0 million income tax recovery on sales of operations in 2000;

     - $30.0 million in proceeds received in 2000 from the divestiture agreement
       relating to Florida facilities; and

     - a $2.2 million increase in payments for the purchase of property and
       equipment.

     Cash used for financing activities decreased by $18.2 million to $66.5
million for 2001 compared to $84.7 million for 2000. The decrease is primarily
due to:

     - a decrease of $14.5 million in payments of long-term debt;

     - a $5.4 million increase in cash provided by bank indebtedness;

     - a $1.3 million decrease in other liabilities; and

     - a $3.0 million decrease in proceeds from issuance of long-term debt.

Liquidity and Capital Resources -- Historical

     As of December 31, 2001, borrowings, including bank indebtedness and both
current and long-term maturities of debt, totaled $385.9 million, representing a
decrease of $65.7 million from December 31, 2000.

     We have a $200 million revolving credit facility, of which we have waived
$25 million pursuant to an amendment to the borrowing agreement in the second
quarter of 1999. Borrowing availability under this

                                        47


line of credit totaled $74.3 million at December 31, 2001 as a result of our
outstanding borrowings of $63.0 million, letters of credit in the amount of
$37.7 million and the $25.0 million waived under the amendment.

     Our existing credit facility matures on December 31, 2003, at which time
all outstanding borrowings are due. The Tranche A term loan matures on December
31, 2003 with annual repayments of $6.6 million in 2002 and $6.1 million in
2003, payable in quarterly installments. The Tranche B term loan matures on
December 31, 2004 with annual repayments, payable in quarterly installments, of
$1.0 million in 2002 and $0.6 million in 2003, with the balance of $59.1 million
due in 2004.

     Our existing credit facility contains a number of covenants, including
restrictions on our payment of dividends, redemption of our common stock and any
change of control of EHSI. The credit facility also contains financial
covenants, including a fixed charge coverage ratio, debt leverage ratios, and a
net worth ratio. We are required to make mandatory prepayments of principal upon
the occurrence of certain events, such as certain asset sales and certain
issuances of securities. We are permitted to make voluntary prepayments at any
time. Such prepayments may, under certain conditions, reduce the amounts
available to be borrowed under the credit facility.

     We were in compliance with the financial covenants of our existing credit
facility as of December 31, 2001. The financial covenants under this credit
facility continue to become more stringent over the term of the facility. While
we have a strategy to remain in compliance, there can be no assurance that we
will meet future covenant requirements. Our available bank lines can be affected
by our ability to remain in compliance, or if not, would depend upon our ability
to amend the covenants or refinance the debt.

     The senior subordinated notes are our unsecured senior subordinated
obligations, subordinated in right of payment to all of our existing and future
senior indebtedness, which includes all borrowings under the existing credit
facility as well as all indebtedness not refinanced by that credit facility. The
senior subordinated notes mature on December 15, 2007. We pay interest on the
senior subordinated notes semi-annually.

     Principal payments on long-term debt due within the next five years and
thereafter are as follows (dollars in thousands):

                                                             
2002........................................................    $ 12,099
2003........................................................      70,597
2004........................................................      60,031
2005........................................................         920
2006........................................................         880
After 2006..................................................     240,820
                                                                --------
                                                                $385,347
                                                                ========



     At December 31, 2001, we were committed to making the following minimum
rental payments under non-cancelable operating leases (dollars in thousands):

                                                             
2002........................................................    $12,169
2003........................................................      9,397
2004........................................................      8,987
2005........................................................      8,865
2006........................................................      6,325
After 2006..................................................     33,208
                                                                -------
       Total minimum payments...............................    $78,951
                                                                =======



                                        48


Liquidity and Capital Resources Following the Issuance of the Old Notes

     In connection with the issuance of the old notes, we refinanced all
outstanding indebtedness under our existing credit facility with the proceeds
from that issuance and we entered into a new credit facility that provides
senior secured financing of up to $105.0 million on a revolving basis. As of
July 15, 2002, we did not have any borrowings outstanding under this new credit
facility, but we did replace $40.1 million of letters of credit under the old
credit facility with new letters of credit under the new credit facility. The
new credit facility will terminate on June 28, 2007. Borrowings drawn during the
first four fiscal quarters following closing of the new credit facility will
initially bear interest, at our option, at an annual rate equal to:

     - LIBOR, plus 3.50%; or

     - the Base Rate, as defined in our new credit facility, plus 2.50%;

thereafter, in each case, subject to adjustments based on financial performance.
Our obligations under the new credit facility are guaranteed by:

     - Extendicare Holdings, Inc., our direct parent;

     - each of our current and future domestic subsidiaries excluding certain
       inactive subsidiaries; and

     - any other current or future foreign subsidiaries that guarantee or
       otherwise provide direct credit support for any U.S. debt obligations of
       ours or any of our domestic subsidiaries;

and is secured by a perfected first priority security interest in certain of our
tangible and intangible assets and all of our and our subsidiary guarantors'
capital stock. The new credit facility is also secured by a pledge of 65% of the
voting stock of our and our subsidiary guarantors' foreign subsidiaries, if any.
Borrowings under our new credit facility require compliance with various
financial covenants, including a minimum fixed charge coverage ratio, a minimum
tangible net worth, a maximum senior leverage ratio and a maximum senior secured
leverage ratio. Our new credit facility contains customary covenants and events
of default and is subject to various mandatory prepayments and commitment
reductions.

     We entered into a five-year interest rate swap contract with a notional
amount of $150 million. The contract effectively converted up to $150 million of
our fixed interest rate indebtedness into variable interest rate indebtedness.

     We believe that our cash from operations and anticipated growth, together
with other available sources of liquidity, including borrowings available under
our new credit facility, will be sufficient for the foreseeable future to fund
anticipated capital expenditures and make required payments of principal and
interest on our debt, including payments due on the notes and obligations under
our new credit facility.

                                        49


Quantitative Disclosures

     The table below presents principal, or notional, amounts and related
weighted average interest rates by year of maturity for our debt obligations and
interest rate swaps (dollars in thousands):



                                                                                     AFTER                    FAIR
                                   2002      2003       2004      2005     2006       2006       TOTAL       VALUE
                                  ------    -------    -------    -----    -----    --------    --------    --------
                                                                                    
LONG-TERM DEBT:
Fixed Rate....................    $  560    $   674    $   710    $ 701    $ 644    $205,910    $209,199    $216,622
Average Interest Rate.........     7.24%      7.42%      7.52%    7.64%    7.43%       9.33%       9.30%
Variable Rate.................    $4,861    $64,552    $58,547    $ 219    $ 236    $ 34,910    $163,325    $141,900
Average Interest Rate.........     4.18%      4.16%      4.89%    2.00%    2.00%       1.46%       3.84%
INTEREST RATE SWAPS:
Notional Amount...............        --    $25,000         --       --       --          --    $ 25,000    $    737
Average Pay Rate (fixed
  rate).......................        --      5.53%         --       --       --          --       5.53%
Average Receive Rate (variable
  rate).......................        --      1.90%         --       --       --          --       1.90%


     The above table incorporates only those exposures that existed as of March
31, 2002 and does not consider those exposures or positions which could arise
after that date or future interest rate movements. As a result, the information
presented above has limited predictive value. Our ultimate results with respect
to interest rate fluctuations will depend upon the exposures that arise during
the period, our hedging strategies at the time and interest rate movements.

                                        50


                                    BUSINESS

EXTENDICARE HEALTH SERVICES, INC.

     We are one of the largest providers of long-term care and related services
in the United States. Through our network of geographically clustered
facilities, we offer a continuum of healthcare services, including skilled
nursing care, assisted living and related medical specialty services, such as
subacute care and rehabilitative therapy. As of March 31, 2002, we operated or
managed 198 long-term care facilities with 18,328 beds in 15 states, of which
157 were skilled nursing facilities with 16,416 beds and 41 were assisted living
and retirement facilities with 1,912 units. In addition, we operated 21
outpatient rehabilitation clinics in four states. We also provided consulting
services to 34 facilities with 3,195 beds in two states. We receive payment for
our services from Medicare, Medicaid, private insurance, self pay residents and
other third party payors. For the twelve month period ended March 31, 2002, we
generated adjusted revenue from continuing operations of $770.3 million and
$83.4 million of Adjusted EBITDA.

     We focus on our core skilled nursing facility operations, while continuing
to grow our complementary long-term care services. By emphasizing quality care
of patients and by clustering several long-term care facilities together within
the geographic areas we serve, we hope to build upon our reputation as a leading
provider of a full range of long-term care services in our communities and, as a
result, to continue to improve our Medicare census and occupancy rate. For the
three months ended March 31, 2002, our average occupancy rate was 89.5% in our
skilled nursing facilities and 81.8% in our assisted living facilities.

THE LONG-TERM CARE INDUSTRY

     According to the Health Care Industry Market Update report issued in
February 2002 by the Centers for Medicare and Medicaid Services (formerly the
Health Care Financing Administration), long-term care spending related to
nursing facilities was estimated at approximately $92.2 billion in 2000. The
aging of the U.S. population is a leading driver of demand for long-term care
services. According to the U.S. Census Bureau, there are approximately 35
million Americans aged 65 or older, representing 13% of the total U.S.
population. The Centers for Medicare and Medicaid Services have projected the
annual growth rate through 2020 for persons over 65 will be 1.8%, and 2.6% for
persons over 85. In 2000, approximately 2.1 million or 5.9% of all persons aged
65 and over were living in a nursing facility, up from 5.0% in 1990. The
long-term care industry is fragmented, with the 10 largest nursing facility
companies accounting for 18.5% of the total facility beds.

     As the number of people over age 65 continues to grow and as advances in
medical technology continue to increase life expectancies, healthcare costs are
expected to rise faster than the availability of resources from
government-sponsored healthcare programs. In response to these rising costs,
governmental and private pay sources in the United States have adopted cost
containment measures that encourage reduced lengths of stay in acute care
hospitals. As a result, an increasing number of patients require a high degree
of monitoring, intensive and specialized medical care, 24-hour per day nursing
services and a comprehensive array of rehabilitative therapies. This trend has
increased the demand for these services from long-term care, home healthcare,
outpatient facilities, hospices and assisted living facilities to provide some
or all of these services in place of acute care hospitals. Long-term care
companies with information systems to process clinical and financial data and
that provide a broad range of healthcare services are in a more competitive
position than traditional acute care and rehabilitation hospitals to contract
with managed care companies and other payors to provide a continuum of services
to the elderly population.

COMPETITIVE STRENGTHS

     Leading Provider of Long-Term Care Services. We are among the largest
providers of long-term care services in the United States. As of March 31, 2002,
we owned, leased or managed 198 long-term care facilities with 18,328 beds. Our
scope of operations allows us to achieve economies of scale in purchasing and
contracting with suppliers and customers. For example, through one of our
subsidiaries, we purchase for nursing facilities in numerous states in addition
to the facilities we operate or manage. Through our

                                        51


affiliate, Virtual Care Provider, Inc., we also provide technology support
services to unaffiliated long-term care facilities.

     Significant Facility Ownership. We own rather than lease a majority of our
properties, unlike a number of other long-term care providers. As of March 31,
2002, we owned 157 facilities and had the option to purchase an additional seven
facilities, or a combined 93.7% of the total number of facilities we operated.
We believe that owning properties increases our operating flexibility by
allowing us to:

     - refurbish facilities to meet changing consumer demands;

     - add assisted living and retirement facilities adjacent to our skilled
       nursing facilities;

     - divest facilities and exit markets at our discretion; and

     - more directly control our occupancy costs.

     Focus on Core Business. Over the past four years, we have successfully
identified and disposed of business segments that did not fit within our core
business and facilities located in states with unacceptable litigation risks.
These dispositions included the 1998 sale of our institutional pharmacy
operation, the 1999 and 2000 sale or lease of all of our facilities in Florida
and the 2001 lease or sublease of all our skilled nursing operations in Texas.
We intend to continue to focus on owning and managing long-term care facilities.
In addition, we will continue to review the performance of our current
facilities and exit markets or sell facilities that do not meet our performance
goals.

     Dual Medicare and Medicaid Certification. We have certified substantially
all of our beds for the provision of care to both Medicare and Medicaid
patients. We believe that dual certification increases the likelihood of higher
occupancy rates by increasing the availability of beds to patients who require a
specific bed certification. In addition, dual certification allows our
facilities to easily shift patients from one level of care and reimbursement to
another without physically moving the patient.

     Management Focus on Key Performance Drivers. We believe that our senior
management, as well as our field personnel, are proficient at focusing on the
key areas that drive revenues, profits and cash flows. Our senior management has
identified three critical drivers of operating and financial performance:

     - improving census, particularly increasing our Medicare census;

     - expediting billing and collections; and

     - controlling labor costs.

     Every level of management, starting with our chief executive officer,
devotes a significant portion of its time to improving these drivers. We believe
that this attention has resulted in substantial improvement in several of our
key operating metrics.

     For the three month period ended March 31, 2002, the occupancy rate for our
skilled nursing facilities was 89.5%, or 2.4 percentage points higher than the
87.1% occupancy rate for the three month period ended March 31, 2001. For the
three month period ended March 31, 2002, our Medicare revenues were 25.5% of
total revenues, or 2.1 percentage points higher than our Medicare revenues
percentage for the three month period ended March 31, 2001, which was 23.4%.

     Through consistent emphasis on admissions protocols, attention to older and
larger account balances and proactive collection efforts at regional and head
offices, we have improved our accounts receivable management. Days of revenues
outstanding have dropped from approximately 59 days in 1998 to 46 days as of
March 31, 2002.

     We have employed a variety of strategies to control labor costs and
minimize the use of temporary staff. Our strategies include adjusting wage
scales, offering greater flexibility in staffing and improving overall job
satisfaction. Regular wages as a percent of revenues have declined to 45.7% in
the three months ended March 31, 2002 from 46.8% in the three months ended March
31, 2001, while temporary wages as a percent of revenues in the same periods
decreased to 1.6% from 2.6%.

                                        52


     Geographic Diversity. We operate or manage facilities located in specific
markets across 15 states throughout the Northeast, Midwest, South and Northwest
regions of the United States. No state contains more than 18% of our facilities
or 20% of our beds or generates more than 21% of our Adjusted EBITDA. Each state
is unique in terms of its competitive dynamics as well as political and
regulatory environment. Each state administers its own Medicaid program, which
constitutes a significant portion of our revenue. Our diversified market scope
limits our exposure to events or trends that may occur in any individual state,
including changes in any state's Medicaid reimbursement program and in regional
and local economic conditions and demographics.

     Experienced and Proven Management Team. Our management has demonstrated
competency in dealing with major changes in the reimbursement environment
resulting from the shift to the prospective payment system, or PPS. In addition,
management determined that the best way to address the extremely litigious
environments in Florida and Texas was to cease operating in those markets.
During these challenging times, we have retained substantially all of our
executive and operating management team.

BUSINESS STRATEGY

     The principal elements of our business strategy are to:

     Provide Quality, Clinically Based Services. We engage in outcomes
management, forecasting and continuous quality improvement processes at the
facility, regional and corporate level. In recognition of increased state
regulatory oversight, we have an internal team of field-based quality validation
specialists who are responsible for mirroring the regulatory survey process and
regularly communicating with our outcomes management specialists in our
corporate office. On-site data is integrated with clinical indicators, facility
human resource data and state regulatory outcomes to provide a detailed picture
of problems, challenges and successes in achieving performance at all levels of
our organization. This information pool allows us to determine best practices
for duplication in similarly situated facilities. We emphasize these programs
when marketing our services to acute care providers, community organizations and
physicians in the communities we serve.

     Increase Medicare Census. We continue to develop and implement strategies
and capabilities to attract residents, with a focus on increasing Medicare
census. As of March 31, 2002, Medicare payments represented approximately 26% of
our total net revenues, up from 22% in 1999. Senior management has worked with
our regional and local management teams to develop strategies to continue to
increase this percentage. Strategies such as focused marketing efforts,
standardized admissions protocols, streamlined admitting procedures, the dual
certification of beds and improved management communication have driven this
improvement. In addition to increasing our facilities' profitability, the
increased Medicare census expands the market for our service related businesses
as Medicare patients utilize significant ancillary services.

     Leverage Presence in Small Urban Markets. We geographically cluster our
long-term care facilities and services in small urban markets in order to
improve operating efficiencies and to offer our customers a broad range of
long-term care and related health services, including assisted living
facilities. Future expansion of our owned nursing facility operations is
anticipated to be through the selective acquisition and construction of new
facilities in areas that are in close proximity to existing facilities, where
management is experienced in dealing with the regulatory and reimbursement
environments, where the facility can participate as an active member of the
nursing facility association and where the facility's reputation is established.

     Expand Management and Consulting Services. We seek to increase the number
of management and consulting contracts with third party operators. We have
knowledge and expertise in both the operational and administrative aspects of
the long-term care sector. We believe that the increasingly complex and
administratively burdensome nature of the long-term care sector, coupled with
our commitment and reputation as a leading, high-quality operator, will drive
demand for new contracts. We believe this strategy is a logical extension of our
business model and competencies and will drive growth without requiring
substantial capital expenditures.
                                        53


     Increase Operating Efficiency. We are focused on reducing operating costs
by improving our communications systems, streamlining documentation and
strengthening the formalization of procedures to approve expenditures. We are
reducing duplication of roles at the corporate and regional levels. We continue
to seek to improve our utilization of regional resources by adding management
and consulting contracts to our existing regions, thereby enabling us to spread
the semi-fixed costs of our regional structure over a wider base of facilities.

     Proactively Manage Our Asset Portfolio. While we have made significant
progress over the last several years in disposing of non-core and
under-performing assets, we will continue to review our asset portfolio and exit
markets or sell facilities which do not meet our performance goals.

OPERATIONS

Nursing Care

     We provide a broad range of long-term nursing care, including skilled
nursing services, subacute care and rehabilitative therapy services, to assist
patients in the recovery from acute illness or injury. We provide nursing care
and therapy services to persons who do not require the more extensive and
specialized services of a hospital. Our nursing facilities employ registered
nurses, licensed practical nurses, therapists, certified nursing assistants and
qualified healthcare aides who provide care as prescribed by each resident's
attending physician. All of our nursing facilities provide daily dietary
services, social services and recreational activities, as well as basic services
such as housekeeping and laundry.

Assisted Living and Retirement Facilities

     In our assisted living facilities, we provide residential accommodations,
activities, meals, security, housekeeping and assistance in the activities of
daily living to seniors who require some support, but not the level of nursing
care provided in a nursing facility. Our retirement communities provide
activities, security, transportation, special amenities, comfortable apartments,
housekeeping services and meals. Our assisted living facilities enhance the
value of an existing nursing facility in situations where the two facilities
operate side by side. This allows us to better serve the communities in which we
operate by providing a broader continuum of services. Most of our assisted
living facilities are within close proximity to our nursing facilities.

Management and Selected Consulting Services

     We apply our operating expertise and knowledge in long-term care by
providing either full management services or selected consulting services to
third parties.

     Through our wholly owned subsidiary, Partners Health Group, LLC, we provide
full management services utilizing our experienced professionals who have
considerable knowledge and expertise in both the operational and administrative
aspects of the long-term care industry. For full management contracts, we
consult on all aspects of operating a long-term care facility, including the
areas of nursing, dietary, laundry and housekeeping. Contracts are structured as
fee-for-service contracts, with the fees sometimes being based on a percentage
of revenues. The contracts generally have terms ranging from one to five years.

     Through our wholly owned subsidiary, Fiscal Services Group, LLC, we provide
selected consulting services, which include selected accounting or cost
reimbursement services. Accounting services can include billing, accounts
receivable tracking, payroll, invoice processing, financial reporting, tax and
cost reimbursement services. Contracts are structured as fee-for-service
contracts, with the fees sometimes being based on a percentage of revenues. The
contracts generally have terms ranging from one to five years.

     In addition, Virtual Care Provider, Inc., a wholly owned subsidiary of our
parent, Extendicare Inc., provides information technology services to us and
unrelated third parties on a fee-for-services basis.

                                        54


Group Purchasing

     Through United Professional Services, Inc., one of our wholly owned
subsidiaries, we provide purchasing services for nursing facilities in numerous
states in addition to the facilities we own or manage. We offer substantial cost
reductions for members of the purchasing group through the contractual volume-
based arrangements made with a variety of industry suppliers for food, supplies
and capital equipment.

Rehabilitative Therapy

     We operate rehabilitative therapy clinics within our wholly owned
subsidiary, The Progressive Step Corporation. As of March 31, 2002, we operated
21 clinics: nine in Pennsylvania, one in Ohio, one in Texas and ten in
Wisconsin. These clinics provide services to outpatients requiring physical,
occupational and/or speech-language therapy. In addition, our Pennsylvania
clinics provide respiratory and psychological and social services.

     We provide rehabilitative therapy services on an inpatient and outpatient
basis. We have expanded all of our nursing facilities' therapy units, with some
facilities offering 1,500 to 5,000 square feet of therapy space. We have
developed therapy programs to provide patient-centered, outcome-oriented
subacute and rehabilitative care. At the majority of our facilities, we employ
physical, occupational and/or speech-language therapists who provide
rehabilitative therapy services to both inpatient and outpatient clients.

SOURCES OF PAYMENT

     The principal reimbursement sources for our nursing services are:

     - Medicaid, a state-administered program financed by state funds and
       matching federal funds, providing health insurance coverage for certain
       persons in financial need, regardless of age, and which may supplement
       Medicare benefits for financially needy persons aged 65 or older.
       Medicaid reimbursement formulas are established by each state with the
       approval of the federal government in accordance with federal guidelines.
       All of the states in which we operate currently use cost-based
       reimbursement systems, which generally may be categorized as prospective
       or retrospective in nature. Under a prospective system, per diem rates
       are established based upon the historical cost of providing services
       during a prior year, adjusted to reflect factors such as inflation and
       any additional service required to be performed. Many of the prospective
       payment systems under which we operate contain an acuity measurement
       system, which adjusts rates based on the care needs of the resident.
       Retrospective systems operate similar to the pre-PPS Medicare program
       where nursing facilities are paid on an interim basis for services
       provided, subject to adjustments based on allowable costs, which are
       generally submitted on an annual basis;

     - Medicare, which is a federally funded health-insurance program providing
       health insurance coverage for persons aged 65 or older and certain
       disabled persons, which provides reimbursement for inpatient services for
       hospitals, nursing facilities and certain other healthcare providers and
       patients requiring daily professional skilled nursing and other
       rehabilitative care (Part A Medicare) and services for suppliers of
       certain medical items, outpatient services and doctors' services (Part B
       Medicare). Medicare pays for the first 20 days of stay in a skilled
       nursing facility in full and the next 80 days above a daily coinsurance
       amount, after the individual has qualified for Medicare coverage by a
       three day hospital stay; and

     - private pay, which consist of individuals, private insurance companies,
       HMOs, PPOs, other charge-based payment sources, HMO Medicare risk plans,
       Blue Cross and the Department of Veterans Affairs.

     We estimate that Medicare and Medicaid accounted for approximately 26% and
49% of our revenues, respectively, for the three months ended March 31, 2002, as
compared to 24% and 51% of revenues for the year ended 2001, 24% and 51% of
revenues for the year ended 2000 and 22% and 50% of revenues for the year ended
1999. These payors have set maximum reimbursement levels for payments for
nursing services and products. The healthcare policies and programs of these
agencies have been subject to changes in
                                        55


payment methodologies during the past several years. There can be no assurance
that future changes will not reduce reimbursements for nursing services from
these sources.

     We derive assisted living facility revenue primarily from private pay
residents at rates we establish based upon the services we provide and market
conditions in the area of operation. Approximately 38 states provide or have
approval to provide Medicaid reimbursement for services in assisted living
facilities covering board and care. An additional six states plan to add
Medicaid coverage of services in the near future.

QUALITY OF CARE AND EMPLOYEE TRAINING

     Our "Commitment to Residents" emphasizes our corporate philosophy of
treating residents with dignity and respect, a philosophy which we implement and
monitor through rigorous standards that we periodically assess and update. At a
regional level, our area directors of care management lead a department that is
primarily responsible for establishing care and service standards, policies and
procedures and auditing care and service delivery systems. They also provide
direction and training for all levels of the staff within the nursing facilities
and assisted living facilities. Our area directors of care management develop
programs and standards for all professional disciplines and services provided to
our customers, including nursing, dietary, social services, activities, ethical
practices, mental health services, behavior management, quality validation and
continuous quality improvement.

     Employee training at all levels is an integral part of our on-going efforts
to improve and maintain our service quality. Each new nursing facility
administrator and assisted living facility manager or director of nursing is
required to attend a week of company-provided training to ensure that he or she
understands all aspects of nursing facility operations, including clinical,
management and business operations. We conduct additional training for these
individuals and all other staff on a regional or local basis.

MARKETING

     Most of our long-term care facilities are located in smaller urban
communities. We focus our marketing efforts predominantly at the local level. We
believe that residents selecting a long-term care facility are strongly
influenced by word-of-mouth and referrals from physicians, hospital discharge
planners, community leaders, neighbors and family members. The administrator of
each long-term care facility is, therefore, a key element of our marketing
strategy. Each administrator is responsible for developing relationships with
potential referral sources. Administrators are supported through a regional team
of marketing personnel, which establish the overall marketing strategy, develop
relationships with HMO and PPO organizations and provide marketing direction
with training and community specific promotional materials. We aim to be the
provider of choice in the communities we serve.

COMPETITION

     The long-term care industry in the United States is highly competitive with
companies offering a variety of similar services. We face local and regional
competition from other healthcare providers, including for-profit and
not-for-profit organizations, hospital-based nursing units, rehabilitation
hospitals, home health agencies, medical supplies and services agencies and
rehabilitative therapy providers. Newer assisted living facilities can attract
an element of the former private pay nursing facility admissions that require a
lesser degree of care. Significant competitive factors affecting the placement
of residents in nursing and assisted living facilities include quality of care,
services offered, reputation, physical appearance, location and, in the case of
private-pay residents, cost of the services. We focus our marketing efforts on
word-of-mouth reputation and referrals from each community's medical and
healthcare professionals.

     Our medical services and supplies operation and our group purchasing
operation compete with other similar operations ranging from small local
operators to companies that have a national scope and distribution capability.

                                        56


     We also compete with other providers in the acquisition and development of
additional facilities. Other competitors may accept a lower rate of return and
therefore, present significant price competition. Also, tax-exempt
not-for-profit organizations may finance acquisitions and capital expenditures
on a tax-exempt basis or receive charitable contributions unavailable to us.

PROPERTIES

     At March 31, 2002, we owned, leased or managed 198 long-term care
facilities with 18,328 beds in 15 states, of which 157 were nursing facilities
with 16,416 beds and 41 were assisted living facilities with 1,912 units. In
addition, we own long-term care properties of which 17 were nursing properties
with 1,862 beds that were leased and operated by unrelated nursing home
providers. We also retain an interest in, but do not operate, 11 nursing
properties with 1,435 beds and four assisted living properties with 135 units.
At March 31, 2002, we also operated 21 rehabilitative therapy clinics: nine in
Pennsylvania, one in Ohio, one in Texas and ten in Wisconsin. The following
table lists by state, the nursing, assisted living and retirement facilities
that we owned, leased or managed at March 31, 2002:



                                    OWNED                  LEASED(1)(2)               MANAGEMENT                  TOTAL
                            ----------------------    ----------------------    ----------------------    ----------------------
                                          RESIDENT                  RESIDENT                  RESIDENT                  RESIDENT
                            FACILITIES    CAPACITY    FACILITIES    CAPACITY    FACILITIES    CAPACITY    FACILITIES    CAPACITY
                            ----------    --------    ----------    --------    ----------    --------    ----------    --------
                                                                                                
Ohio....................        22          2,135         10         1,104           1            70          33          3,309
Pennsylvania............        21          2,204         --            --          14         1,239          35          3,443
Wisconsin...............        34          2,645         --            --          --            --          34          2,645
Indiana.................        16          1,491          4           469          --            --          20          1,960
Washington..............        19          1,499          4           359          --            --          23          1,858
Kentucky................        19          1,549         --            --          --            --          19          1,549
Texas...................         2            110         --            --          --            --           2            110
Minnesota...............        11          1,292         --            --          --            --          11          1,292
Oregon..................         5            294         --            --          --            --           5            294
Arkansas................         4            277         --            --          --            --           4            277
Idaho...................         2            178         --            --          --            --           2            178
Delaware................         1            120         --            --          --            --           1            120
West Virginia...........         1            120         --            --          --            --           1            120
Louisiana...............        --             --         --            --           3           567           3            567
Massachusetts...........        --             --         --            --           5           606           5            606
                               ---         ------         --         -----          --         -----         ---         ------
Total...................       157         13,914         18         1,932          23         2,482         198         18,328
                               ===         ======         ==         =====          ==         =====         ===         ======
Nursing.................       122         12,223         17         1,867          18         2,326         157         16,416
Assisted living.........        35          1,691          1            65           5           156          41          1,912
Consulting services(3):
  Florida...............        --             --         --            --          --            --          18          1,848
  Texas.................        --             --         --            --          --            --          16          1,347
                               ---         ------         --         -----          --         -----         ---         ------
TOTAL, INCLUDING CONSULTING SERVICES..................................................................       232         21,523
                                                                                                             ===         ======


                                        57




                                                                                                                  TOTAL
                                                                                                          ----------------------
                                                                                                                        RESIDENT
                                                                                                          FACILITIES    CAPACITY
                                                                                                          ----------    --------
                                                                                                
Breakdown by type of facility:
  Nursing.............................................................................................       191         19,611
  Assisted living.....................................................................................        41          1,912
                                                                                                             ---         ------
TOTAL, INCLUDING CONSULTING SERVICES..................................................................       232         21,523
                                                                                                             ===         ======
OTHER PROPERTIES:
Nursing facilities under lease(4).....................................................................        17          1,862
Properties under divestiture agreement(5):
  Nursing.............................................................................................        11          1,435
  Assisted living.....................................................................................         4            135
                                                                                                             ---         ------
     Total properties under divestiture agreement.....................................................        15          1,570
                                                                                                             ---         ------
TOTAL OTHER PROPERTIES................................................................................        32          3,432
                                                                                                             ===         ======
Breakdown by type of facility:
  Nursing.............................................................................................        28          3,297
  Assisted living.....................................................................................         4            135
                                                                                                             ---         ------
TOTAL OTHER PROPERTIES................................................................................        32          3,432
                                                                                                             ===         ======


- -------------------------
(1) Except those referred to in note (2) below, the remaining life of the
    leases, including renewal options exercisable solely by us, ranges from
    eight months to seven years, the average being three years. We retain an
    option to purchase the leased property for 12 of the 18 leased properties.

(2) As of March 31, 2002 seven leased facilities in Ohio and Indiana are on a
    month-to-month lease arrangement. We have exercised our right to purchase
    the properties as of September 2000, but negotiations with the landlord to
    complete the transaction have not resolved all issues and may require
    arbitration to conclude the matter. We believe we complied with all terms of
    the option and that the outstanding issues can be resolved.

(3) Consulting services provided to the facilities listed include billing,
    accounts receivable tracking, invoice processing, payroll, financial
    reporting and cost reimbursements services.

(4) The Company owns 17 skilled nursing properties held under lease arrangements
    with three unrelated long-term care operators whose terms include an option
    to purchase the properties. As of March 31, 2002, Tandem leases seven of the
    properties whose term matured on June 30, 2002. Senior Health
    Properties -- South leases six properties whose term matures on December 31,
    2006. Senior Health Properties, Texas -- Inc. leases 4 properties whose term
    matures on September 30, 2006. In addition, Senior Health Properties,
    Texas -- Inc. subleases 12 leased facilities whose term matures in February
    2012. The facilities we lease to Senior Health Properties -- South, Inc. and
    Senior Health Properties -- Texas, Inc. are included in the facilities for
    which we provide consulting services.

(5) We retain an interest in 11 nursing facilities with 1,435 beds and four
    assisted living facilities with 135 units in Florida pursuant to the
    Greystone divestiture agreement. Pursuant to this agreement we retain
    contingent consideration in the form of a series of interest bearing notes
    which have an aggregate potential value of up to $30.0 million plus
    interest.

     The number of skilled nursing beds and assisted living units identified in
the above table and throughout this report represents the approximate number of
operational beds and units that we currently use. The number of operational beds
and units is subject to periodic changes and can be less than the licensed
number of beds approved by the state due to market and other factors.

GOVERNMENT REGULATION

     Various federal, state and local governmental authorities in the United
States regulate the provision of institutional care through nursing facilities.
Though we believe our operations comply with the laws

                                        58


governing our industry, we cannot guarantee that we will be in absolute
compliance with all regulations at all times. Failure to comply may result in
significant penalties, including exclusion from the Medicare and Medicaid
programs, which could have a material adverse effect on our business. We cannot
assure you that governmental authorities will not impose additional restrictions
on our activities that might adversely affect our business. In addition to the
information presented below, please see "Risk Factors -- Risks Relating to Us
and Our Business" and "Management's Discussion and Analysis of Financial
Condition and Results of Operations -- Overview -- Legislative Actions Affecting
Revenues."

General Regulatory Requirements

     Nursing facilities, assisted living facilities and other healthcare
businesses are subject to licensure and other state and local regulatory
requirements. In addition, in order for a nursing facility to be approved for
payment under the Medicare and Medicaid reimbursement programs, it must meet the
participation requirements of the Social Security Act and related regulations.
The regulatory requirements for nursing facility licensure and participation in
Medicare and Medicaid generally prescribe standards relating to provision of
services, resident rights, staffing, employee training, physical environment and
administration. Nursing and assisted living facilities are generally subject to
unannounced annual inspections by state or local authorities for purposes of
licensure and for purposes of certification under Medicare and Medicaid, in the
case of nursing facilities. These surveys will also confirm that nursing
facilities continue to meet Medicare and Medicaid participation standards. All
of our nursing facilities are licensed under applicable state laws. In addition,
all of our nursing facilities are certified to participate in the Medicare
program, the Medicaid program or both.

Environmental Laws and Regulations

     Some federal and state laws govern the handling and disposal of medical,
infectious and hazardous waste. If an entity fails to comply with those laws or
the related regulations, the entity could be subject to fines, criminal
penalties and other enforcement actions. Federal regulations established by the
Occupational Safety and Health Administration impose additional requirements on
us with regard to protecting employees from exposure to blood borne pathogens.
We have developed policies for the handling and disposal of medical, infectious
and hazardous waste to assure that each of our facilities complies with those
laws and regulations. We incur ongoing operational costs to comply with
environmental laws and regulations. However, we have not had to make material
capital expenditures to comply with those laws and regulations. We believe that
we substantially comply with applicable laws and regulations governing these
requirements.

Health Insurance Portability and Accountability Act

     The administrative simplification provisions of the Health Insurance
Portability and Accountability Act mandate a set of interlocking regulations
that will establish the uniform coding conventions and record formats across all
payor types for all electronic transactions central to the processing of all
healthcare claims and health plan enrollments. These standards will allow
entities within the healthcare system to exchange medical, billing and other
information and to process transactions in a more timely and cost effective
manner. These new transactions and code sets must be implemented by October
2002, unless a covered entity is granted an extension of up to one year. Also,
new privacy standards will go into effect on April 14, 2003 that will require
operational changes throughout the healthcare industry in the handling of all
patient information. The privacy standards are designed to protect the privacy
of patients' medical information. While the Bush administration and Congress
could reexamine these privacy standards, it is unlikely there will be changes to
the standards or to the effective date. Security and other standards are
expected to be issued in 2002. All standards are required to be fully
implemented within two years of final issuance, with civil and criminal
penalties established for noncompliance. We have established a work task force
to review and implement the standards required by the legislation and we are
currently on schedule to comply with the requirements.

                                        59


Nursing Facility Regulation

     The Centers for Medicare and Medicaid Services has established regulations
to implement survey, certification and enforcement procedures. The survey
process is intended to review the actual provision of care and services, with an
emphasis on resident outcomes to determine whether the care provided meets the
assessed needs of the individual residents. Surveys are generally conducted on
an unannounced annual basis by state survey agencies. Remedies are assessed for
deficiencies based upon the scope and severity of the cited deficiencies. The
regulations specify that the remedies are intended to motivate facilities to
return to compliance and to facilitate the removal of chronically poor
performing facilities from the program. Remedies range from:

     - directed plans of correction, directed in-service training and state
       monitoring for minor deficiencies;

     - denial of Medicare or Medicaid reimbursement for existing residents or
       new admissions and civil money penalties up to $3,000 per day for
       deficiencies that do not immediately jeopardize resident health and
       safety; and

     - appointment of temporary management, termination from the program and
       civil money penalties of up to $10,000 for one or more deficiencies that
       immediately jeopardize resident health or safety.

     The regulations allow state survey agencies to identify alternative
remedies that must be approved by the Centers for Medicare and Medicaid Services
prior to implementation.

     Facilities with acceptable regulatory histories generally are given an
opportunity to correct deficiencies by a date certain, usually within six
months. The Centers for Medicare and Medicaid Services will continue payments
and refrain from imposing sanctions, unless the facility does not return to
compliance. Facilities with deficiencies that immediately jeopardize resident
health and safety and those that are classified as poor performing facilities
are not given an opportunity to correct their deficiencies prior to the
assessment of remedies. From time to time, we receive notices from federal and
state regulatory agencies alleging deficiencies for failing to comply with all
components of the regulations. While we do not always agree with the positions
taken by the agencies, we review all such notices and take corrective action
when appropriate. Due to the fact that the regulatory process provides us with
limited appeal rights, many alleged deficiencies are not challenged even if we
do not agree with the allegation.

     While we try to comply with all applicable regulatory requirements, from
time to time some of our nursing facilities have been sanctioned as a result of
deficiencies alleged by the Centers for Medicare and Medicaid Services or state
survey agencies. In November 2000, we operated one facility in Indiana that lost
its certification under the Medicare and Medicaid programs, but that facility
has since been recertified under both programs. We cannot assure you that we
will not be sanctioned and penalized in the future.

     The Centers for Medicare and Medicaid Services has launched the Nursing
Home Quality Initiative pilot program with the states of Colorado, Florida,
Maryland, Ohio, Rhode Island and Washington. This program, which is designed to
provide consumers with comparative information about nursing home quality
measures, will rate every nursing home operating in these states on nine quality
of care indicators. These quality of care indicators include such measures as
percentages of patients with infections, bedsores and unplanned weight loss.
This comparative data will be made available to the public on the Centers' web
site and is expected to be published in local newspapers. The Centers for
Medicare and Medicaid Services has announced that if this pilot program is
successful, it intends to expand the initiative to all other states. We believe
that we have appropriate systems and mechanisms in place to monitor care and
service delivery. We expect that our facilities that may not substantially
comply with the regulations will ultimately substantially comply. We cannot
predict whether we will comply in the future and we could be adversely affected
if a substantial portion of our facilities were determined to not comply with
applicable regulations. We currently operate nursing homes in Ohio and
Washington.

Restrictions on Acquisitions and Construction

     Acquisition and construction of additional nursing facilities are subject
to state regulation. Most of the states in which we currently operate have
adopted laws to regulate expansion of skilled nursing facilities.

                                        60


Certificate of need laws generally require that a state agency approve certain
acquisitions or physical plant changes and determine that a need exists prior to
the addition of beds or services, the implementation of the physical plant
changes or the incurrence of capital expenditures exceeding a prescribed amount.
Some states also prohibit, restrict or delay the issuance of certificates of
need. In addition, in most states the reduction of beds or the closure of a
facility requires the approval of the appropriate state regulatory agency and,
if we decide to reduce beds or close a facility, we could be adversely affected
by a failure to obtain or a delay in obtaining such approval. To the extent that
a certificate of need or other similar approvals are required for expansion of
our operations, either through facility acquisitions, construction of new
facilities or additions to existing facilities, or expansion or provision of new
services or other changes, our expansion proposals could be adversely affected
by an inability to obtain the necessary approvals, changes in the standards
applicable to such approvals and possible delays and expenses associated with
obtaining such approvals.

     Acquisition, construction and operation of assisted living facilities are
subject to less stringent regulation than nursing facilities and, in the absence
of uniform federal regulations, states develop their own regulations. However,
since 1999 the term "assisted living facility" has been defined in 29 state
regulations and statutes, and approximately half of the remaining states have
regulations currently in effect or have proposed regulations regarding assisted
living facilities. Virtually every state has a licensure process and some form
of regulation that may apply to assisted living providers. If an assisted living
provider supplies services that meet the definition of a licensed level of care
in the state, the provider must be licensed. Licensure regulations can apply to
admission and discharge criteria and the variety and type of services provided.
Many states require that buyers submit building plans and receive state approval
prior to construction. However, the approval process is different from the
certificate of need procedure, as it is more of a clearance process than a
demand formula. Assisted living facilities must meet a stringent set of building
construction and design regulations including the Life Safety Code (NFPA101).
State regulators conduct inspections of assisted living facilities on a periodic
basis similar to their inspections of nursing facilities in most cases.

Regulation of Fraud and Related Matters

     Because we participate in federal and state health care programs, we are
subject to a variety of federal and state laws that are intended to prevent
health care fraud and abuse. These laws are punishable by criminal and/or civil
sanctions, including, in some instances, exclusion from participation in federal
health programs, including Medicare, Medicaid and Department of Veterans Affairs
health programs. These laws, which include, but are not limited to,
anti-kickback laws, false claims laws, physician self-referral laws and federal
criminal health care fraud laws, are discussed in further detail below.

     We believe our billing practices, operations and compensation and financial
arrangements with referral sources and others materially comply with applicable
federal and state requirements. However, we cannot assure you that a
governmental authority will not interpret such requirements in a manner
inconsistent with our interpretation and application. If we fail to comply, even
inadvertently, with any of these requirements, we could be required to alter our
operations and/or refund payments to the government. In addition, we could be
subject to significant penalties. Even if we successfully defend against any
action against us for violating these laws or regulations, we would likely be
forced to incur significant legal expenses and divert our management's attention
from the operation of our business. Any of these actions, individually or in the
aggregate, could have a material adverse effect on our business and financial
results. We cannot reasonably predict whether enforcement activities will
increase at the federal or state level or the effect of any such increase on our
business.

     The illegal remuneration provisions of the Social Security Act make it a
felony to solicit, receive, offer to pay or pay any kickback, bribe or rebate in
return for referring a resident for any item or service or in return for
purchasing, leasing, ordering, recommending or arranging for any good, facility,
service or item, for which payment may be made under the federal healthcare
programs. A violation of the illegal remuneration statute may result in the
imposition of criminal penalties, including imprisonment for up to

                                        61


five years, the imposition of a fine of up to $25,000, civil penalties and
exclusion from participating in federal health programs.

     Recognizing that the law is broad and may technically prohibit beneficial
arrangements, the Office of Inspector General of the Department of Health and
Human Services developed regulations addressing those types of business
arrangements that will not be subject to scrutiny under the law. These safe
harbors describe activities that may technically violate the act, but which are
not to be considered illegal when carried on in conformance with the
regulations. For example, the safe harbors cover activities such as contracting
with physicians or other individuals that have the potential to refer business
to us that would ultimately be billed to a federal health program. Failure to
qualify for safe harbor protection does not mean that an arrangement is illegal.
Rather, the arrangement must be analyzed under the anti-kickback statute to
determine whether there is an intent to pay or receive remuneration in return
for referrals. Conduct and business arrangements that do not fully satisfy one
of the safe harbors may result in increased scrutiny by government enforcement
authorities. In addition, some states have anti-kickback laws that may apply
regardless of whether a federal health care program is involved. Although our
business arrangements may not always satisfy all the criteria of a safe harbor,
we believe that our operations are in material compliance with federal and state
anti-kickback laws.

     Under the federal "Stark II" law, physicians are prohibited from making a
referral to an entity for the furnishing of designated health services,
including therapy services, for which Medicare or Medicaid may pay, if the
physician, or an immediate family member of the physician, has a financial
relationship, including ownership interests and compensation arrangements, with
that entity, and the relationship fails to meet a statutory or regulatory
exception to the rule. The penalties for violating this act include denial of
payment, additional financial penalties and exclusion from participating in
federal health programs. In addition, a number of states have enacted their own
versions of self-referral laws.

     The Federal False Claims Act and similar state statutes prohibit
presenting, a false or misleading claim for payment under a federal program.
Violations can result in significant civil penalties, treble damages and
exclusion from participation in federal programs. Liability arises, primarily,
when an entity knowingly submits a false claim for reimbursement to the federal
government. However, enforcement over the past few years has expanded the
traditional scope of this act to cover quality of care issues, especially in the
skilled nursing facility context. In addition to the civil provisions of the
False Claims Act, the federal government can use several other criminal statutes
to prosecute persons who submit false or fraudulent claims for payment to the
federal government.

     Federal law provides that practitioners, providers and related persons may
not participate in most federal healthcare programs, including the Medicare and
Medicaid programs, if the individual or entity has been convicted of a criminal
offense related to the delivery of an item or service under these programs or if
the individual or entity has been convicted, under state or federal law, of a
criminal offense relating to neglect or abuse of residents in connection with
the delivery of a healthcare item or service. Other individuals or entities may
be, but are not required to be, excluded from such programs under certain
circumstances, including the following:

     - conviction related to fraud;

     - conviction relating to obstruction of an investigation;

     - conviction relating to a controlled substance;

     - licensure revocation or suspension;

     - exclusion or suspension from state or federal healthcare programs;

     - filing claims for excessive charges or unnecessary services or failure to
       furnish medically necessary services;

     - ownership or control by an individual who has been excluded from the
       Medicaid and/or Medicare programs, against whom a civil monetary penalty
       related to the Medicaid and/or Medicare

                                        62


       programs has been assessed or who has been convicted of the crimes
       described in this paragraph; and

     - the transfer of ownership or control interest in an entity to an
       immediate family or household member in anticipation of, or following, a
       conviction, assessment or exclusion.

Cross Disqualification and De-Licensure

     In some circumstances, if one facility is convicted of abusive or
fraudulent behavior, then other facilities under common control or ownership may
be disqualified from participating in Medicaid or Medicare programs. Executive
Order 12549 prohibits any corporation or facility from participating in federal
contracts if it or its principals have been barred, suspended or are ineligible
or have been voluntarily excluded from participating in federal contracts. In
addition, some state regulations provide that all facilities under common
control or ownership licensed within a state may be de-licensed if any one or
more of the facilities are de-licensed.

Office of the Inspector General

     In 1995, a major anti-fraud demonstration project, "Operation Restore
Trust" was announced by the Office of the Inspector General, which guaranteed
funding for fraud and abuse activities and coordinated efforts among multiple
federal and state agencies. A primary purpose for the operation is to scrutinize
the activities of healthcare providers who are reimbursed under the Medicare and
Medicaid programs. Initial investigation efforts have focused on skilled nursing
facilities, home health and hospice agencies and durable medical equipment
suppliers in Texas, Florida, New York, Illinois and California. In May 1997, The
Department of Health and Human Services announced that the operation would be
expanded in the future to include several other types of healthcare services and
several additional states, with the intent that it will ultimately be a
nationwide operation. Over the longer term, the operation's enforcement actions
could include criminal prosecutions, suit for civil penalties and/or Medicare,
Medicaid or federal healthcare program exclusions. Prior to our November 1997
acquisition of Arbor Health Care Company, one of its subsidiary's facilities was
charged with inadequately documented therapy services. Following this
investigation, Arbor adopted measures to strengthen its documentation relating
to reimbursable services. While we do not believe that we are the target of any
such investigation under operation restore trust, we cannot assure you that we
will not expend substantial amounts to cooperate with any such investigation or
to defend allegations that may arise from an investigation. If a government
agency finds that any of our practices failed to comply with the anti-fraud
provisions, we could be materially adversely affected.

Compliance Program

     Compliance with federal, state and local laws and regulations and our
internal policies has always been and continues to be a priority of ours. In
March 2000, the Office of the Inspector General issued guidance to the skilled
nursing care industry regarding elements that should be included in an effective
compliance plan. In 2001, we formalized our existing compliance efforts by
issuing our corporate compliance program, incorporating the elements included in
the guidance issued by the Office of the Inspector General. As part of the
compliance program, our employees must acknowledge their responsibility to
comply with relevant laws, regulations and policies, including our compliance
program.

New Initiatives

     There are ongoing initiatives at the federal and state levels for
comprehensive reforms affecting the payment for and availability of health care
services. Aspects of some of these health care initiatives, such as the
termination of Medicare funding improvements and limitations on Medicare
coverage, other pressures to contain health care costs by Medicare, Medicaid and
other payors, as well as increased operational requirements in the
administration of Medicaid, could adversely affect us. We cannot predict the
ultimate content, timing or effect of any health care reform legislation, nor
can we estimate the impact of potential legislation on us.

                                        63


INSURANCE

     Since January 1, 2000, we generally self-insure for comprehensive general
and professional liability up to a certain amount per incident. We currently
maintain insurance policies through both affiliated subsidiaries of Extendicare
Inc. and third-party insurers covering property, workers' compensation and
employer's liability insurance in amounts and with such coverage and deductibles
as we believe are appropriate, based on the availability, nature and risks of
our business, historical experience and industry standards. We also self-insure
for health and dental claims, for workers' compensation and employer's liability
in certain states and, since January 2000, for general and professional
liability. In January 2000, our retained risk for general and professional
liability coverage increased significantly. As a result, we provided additional
accruals based upon past claims and actuarial estimates of the ultimate cost to
settle claims. Those risks were significantly reduced when we ceased operating
all Florida facilities in 2000 and Texas nursing facilities in the fourth
quarter of 2001. General and professional liability claims are the most volatile
and significant risks that we self-insure.

LEGAL PROCEEDINGS

     We and our subsidiaries are defendants in actions against us or them from
time to time in connection with our operations and due to the nature of our
business. These actions may include civil or criminal actions resulting from
personal injury and wrongful death suits arising out of allegations of
professional malpractice brought against us, one or more of our facilities or
the individuals who work at particular facilities. We are unable to predict the
ultimate outcome of pending litigation and other investigations. We cannot
assure you that claims will not arise that are in excess of our insurance
coverage, are not covered by our insurance coverage or result in punitive
damages being assessed against us. In addition, we cannot assure you that the
United States Department of Justice, the Centers for Medicare and Medicaid or
other regulatory agencies will not initiate investigations related to our
businesses in the future. A successful claim against us that is not covered by,
or is in excess of, our insurance could have a material adverse effect on our
financial condition and results of operations. Claims against us, regardless of
their merit or eventual outcome, would require management to devote time to
matters unrelated to the operation of our business and, due to publicity, may
also have a material adverse effect on our ability to attract residents or
expand our business.

     For additional information regarding legal proceedings, please see "Risk
Factors -- Risks Relating to Us and Our Business" and "Management's Discussion
and Analysis of Financial Condition and Results of Operations -- Year Ended
December 31, 2001 Compared with Year Ended December 31, 2000 -- Operating and
General and Administrative Costs."

EMPLOYEES

     As of December 31, 2001, we employed approximately 19,000 people, including
approximately 3,600 registered and licensed practical nurses, 7,200 nursing
assistants, 1,600 therapists, 5,100 dietary, domestic, maintenance and other
staff and 1,300 administrative employees who work at our corporate offices and
facilities. We have approximately 38 collective bargaining agreements, 20 of
which expire within 12 months of March 31, 2002, among six unions covering
approximately 2,260 employees. We believe that we have a good relationship with
our employees.

                                        64


                                   MANAGEMENT

DIRECTORS AND OFFICERS

     The following table sets forth information with respect to our executive
officers and directors:



                   NAME                       AGE                     POSITION
                   ----                       ---                     --------
                                               
Melvin A. Rhinelander.....................    52     Chairman of the Board and Chief Executive
                                                     Officer and Director
Mark W. Durishan..........................    53     Vice President, Chief Financial Officer,
                                                     Treasurer and Director
Richard L. Bertrand.......................    53     Senior Vice President, Development
Philip W. Small...........................    45     Senior Vice President, Strategic Planning
                                                     and Investor Relations and Director
Roch Carter...............................    63     Vice President, General Counsel and
                                                     Assistant Secretary
Douglas J. Harris.........................    46     Vice President and Controller
L. William Wagner.........................    54     Vice President, Human Resources


     Melvin A. Rhinelander is our Chairman and Chief Executive Officer and one
of our directors. He has been with us and our affiliated companies since 1977
and has served in a number of senior management positions. Mr. Rhinelander has
been President of Extendicare Inc. since August 1999, a director since May 2000
and its Chief Executive Officer since August 2000. He has been an officer of our
company since 1989 and a director since 1998. He has been our Chief Executive
Officer since December 1999 and Chairman of our Board of Directors since August
2000. In addition, Mr. Rhinelander is Chief Executive Officer of Extendicare
(Canada) Inc.

     Mark W. Durishan has been our Chief Financial Officer, Treasurer and one of
our Vice Presidents and directors since joining us in August 1999. At that time
he also joined Extendicare Inc. Prior to joining us, Mr. Durishan was Senior
Vice-President of Finance and Operations for Blue Cross and Blue Shield of
Minnesota where he served in such capacity from 1995 to 1998. From 1991 to 1995,
Mr. Durishan was Chief Financial Officer of Graduate Health System of
Philadelphia, a healthcare corporation encompassing seven hospitals, a
100,000-member HMO, a captive insurance company and a home health agency. During
his career, Mr. Durishan was a partner at Coopers & Lybrand responsible for the
Philadelphia and Washington healthcare consulting offices. Mr. Durishan has over
32 years of experience in the healthcare industry.

     Richard L. Bertrand is our Senior Vice President, Development. Mr. Bertrand
joined EHSI in 1983 as our Vice President of Finance. From 1983 to 1995 he
served as our Vice President of Finance and later as our Senior Vice President
of Finance and Chief Financial Officer. Beginning in 1995, Mr. Bertrand served
as our Senior Vice President, Reimbursement and later as our Senior Vice
President, Development. Prior to joining us, Mr. Bertrand served as Vice
President and Controller of Extendicare Inc. from 1977 to 1983. Prior to that,
he was a staff accountant and supervisor with the accounting firm of Thorne
Riddell from 1972 to 1976.

     Philip W. Small joined us in June 2001 as our Senior Vice President,
Strategic Planning and Investor Relations. At that time he also joined
Extendicare Inc. He was appointed to our Board of Directors on December 31,
2001. Prior to joining us, Mr. Small served 15 years at Beverly Enterprises
Corporation, Fort Smith, Arkansas, in various financial capacities, the most
recent being Executive Vice President, Strategic Planning and Operations Support
and acting Chief Financial Officer. His prior experience includes serving as
Director, Reimbursement for HCA Management Company of Atlanta, Georgia. Mr.
Small has over 20 years of experience in the healthcare industry.

     Roch Carter was appointed our Vice President, General Counsel and Assistant
Secretary in January 1998. He joined us in 1974 as Legal Counsel and he was
subsequently appointed our General Counsel in 1985. Prior to joining us, Mr.
Carter was an attorney with the United States Attorney's office

                                        65


in Milwaukee. Mr. Carter was also an attorney with the City of Milwaukee and was
in practice with Young and McManus, S.C. Mr. Carter has over 28 years of
experience in healthcare law and practice.

     Douglas J. Harris joined us in December 1999 as our Controller and one of
our Vice Presidents. From 1994 through 1999, Mr. Harris was the Managing
Director of Extendicare (U.K.) Limited. Mr. Harris has been with us and our
affiliated companies since 1981 and has held positions in various financial
capacities. Prior to joining us, Mr. Harris was an audit supervisor with KPMG.

     L. William Wagner joined us in 1987 as Vice President of Human Resources.
Prior to joining us, Mr. Wagner was Vice President of Human Resources for ARA
Living Centers and Director of Personnel for General Foods Corp. Mr. Wagner has
17 years of experience in the healthcare industry and over 23 years of human
resources experience.

                                        66


              CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

     We are an indirect wholly owned subsidiary of Extendicare Inc. and we
insure certain risks, including comprehensive general liability, property
coverage and excess workers' compensation/employer's liability insurance, with
Laurier Indemnity Company and Laurier Indemnity Ltd., affiliated insurance
subsidiaries of Extendicare Inc. We recorded approximately $5.7 million, $20.7
million and $13.9 million of expenses for this purpose in the fiscal years ended
December 31, 2001, 2000 and 1999, respectively.

     We entered into a capital lease in 1999 relating to computer equipment with
Laurier Indemnity Company. In the first quarter of 2000, we exercised our option
to purchase the equipment for $1.3 million. The consolidated statement of
operations includes interest expense related to this lease of $0.1 million in
2000 and $0.3 million in 1999.

     In January 2001, we established an arrangement for computer hardware and
software support services with Virtual Care Provider, Inc., an affiliated
subsidiary of Extendicare Inc. The annual cost of services was $6.5 million in
2001.

     At December 31, 2001, 2000 and 1999, we had a non-interest bearing note
payable to Extendicare Holdings, Inc., our immediate parent, in the amount of
approximately $3.5 million with no specific due date.

     For federal tax purposes we file as part of a consolidated group of
companies, of which Extendicare Holdings is the parent. Extendicare Holdings is
a subsidiary holding company of Extendicare Inc. that hold all of Extendicare
Inc.'s U.S. operations, including EHSI. We have a tax sharing arrangement with
Extendicare Holdings pursuant to which we had a receivable of $1.0 million at
December 31, 2001, $10.0 million at December 31, 2000 and $31.1 million at
December 31, 1999.

     In addition to the amounts discussed in the preceding two paragraphs, we
had current liabilities due to affiliates of $8.7 million at December 31, 2001,
$9.3 million at December 31, 2000 and $12.2 million at December 31, 1999.

     As of December 31, 2001, Extendicare Inc. and/or one of its wholly owned
subsidiaries held $27.9 million, or 14.0%, of our outstanding senior
subordinated notes.

                                        67


                       DESCRIPTION OF OTHER INDEBTEDNESS

NEW CREDIT FACILITY

     Our new credit facility is a senior secured revolving credit facility
providing for loans of up to $105.0 million. The new credit facility will
terminate on June 28, 2007.

     Interest Rate; Fees. All borrowings drawn during the first four fiscal
quarters following closing of the new credit facility will initially bear
interest, at our option, at a rate per annum equal to:

     - LIBOR, plus 3.50%; or

     - the Base Rate, as defined in the new credit facility, plus 2.50%;

thereafter, in each case, subject to adjustments based on financial performance.

     In addition to paying interest on outstanding principal under the new
credit facility, we are required to pay a commitment fee to the lenders in
respect of the unutilized commitments under the facility.

     Guarantees; Security. Our obligations under the new credit facility are
unconditionally and irrevocably guaranteed by:

     - Extendicare Holdings, Inc., our direct parent;

     - each of our current and future domestic subsidiaries excluding certain
       inactive subsidiaries; and

     - any other current or future foreign subsidiaries that guarantee or
       otherwise provide direct credit support for any U.S. debt obligations of
       ours or any of our domestic subsidiaries.

     In addition, the new credit facility is secured by a perfected first
priority security interest in certain of our tangible and intangible assets and
all of our and our subsidiary guarantors' capital stock. The new credit facility
is also secured by a pledge of 65% of the voting stock of our and our subsidiary
guarantors' foreign subsidiaries, if any.

     Repayment. All or any portion of the outstanding loans under the new credit
facility may be prepaid at any time and commitments may be terminated in whole
or in part at our option without premium or penalty. The new credit facility is
subject to various mandatory prepayments and commitment reductions.

     Certain Covenants. The new credit facility requires that we comply with
various financial covenants, including a minimum fixed charge coverage ratio, a
minimum tangible net worth, a maximum senior leverage ratio and a maximum senior
secured leverage ratio. The new credit facility also contains a number of
covenants that, among other things, restrict our ability and that of our parent
and certain of our subsidiaries to:

     - dispose of assets;

     - incur additional indebtedness;

     - incur guarantee obligations;

     - repay or amend certain terms of other indebtedness, including the notes;

     - pay certain restricted payments and dividends;

     - create liens on assets;

     - make investments, loans or advances;

     - engage in mergers or consolidations;

     - make capital expenditures;

     - enter into new lines of business; or

     - engage in some transactions with subsidiaries and affiliates and engage
       in certain other corporate activities.

The new credit facility also contains other usual and customary negative and
affirmative covenants.

                                        68


     Events of Default. The new credit facility contains events of default
including, subject to customary cure periods and materiality thresholds:

     - failure to make payments when due;

     - material inaccuracies of representations and warranties;

     - breach of covenants;

     - certain cross-defaults and cross-accelerations;

     - events of insolvency, bankruptcy or similar events;

     - certain judgments against us;

     - certain occurrences with respect to employee benefit plans;

     - failure to remain eligible or participate in Medicaid or Medicare
       programs;

     - failure of guarantees to remain in effect;

     - failure of certain liens and security documents to remain enforceable;

     - the occurrence of an event of default under any mortgage;

     - the senior subordinated notes or guarantees of the senior subordinated
       notes cease to be subordinated to the obligations under the new credit
       facility and the credit facility guarantees; and

     - the occurrence of a change in control.

     If such a default occurs, the lenders under the new credit facility would
be entitled to take various actions, including all actions permitted to be taken
by a secured creditor, the acceleration of amounts due under the new credit
facility and requiring that all such amounts be immediately paid in full.

9.35% SENIOR SUBORDINATED NOTES DUE 2007

     We issued $200.0 million aggregate principal amount of senior subordinated
notes in connection with our acquisition of Arbor Health Care Company. The
senior subordinated notes mature on December 15, 2007 and are callable on
December 15, 2002 at 104.675% of par. Interest on the senior subordinated notes
accrues at the rate of 9.35% per year and is payable semiannually on each June
15 and December 15, to the persons who are registered holders at the close of
business on the May 31 or November 30 next preceding the applicable interest
payment date.

     Subordination. The senior subordinated notes are our unsecured obligations
and are junior in right of payment to all of our senior debt. The senior
subordinated notes are also effectively junior in right of payment to all of the
senior debt of the subsidiary guarantors of the senior subordinated notes.

     Redemption. We may redeem the senior subordinated notes at our option, in
whole or in part, upon not less than 30 nor more than 60 days' notice, at the
redemption prices set forth below plus accrued and unpaid interest, if any, to
the applicable redemption date, if redeemed during the twelve-month period
beginning on December 15, of the years indicated below:



                            YEAR                                PERCENTAGE
                            ----                                ----------
                                                             
2002........................................................     104.675%
2003........................................................     103.117%
2004........................................................     101.558%
2005 and thereafter.........................................     100.000%


     Change of Control. If we experience a change of control, as defined in the
indenture relating to the senior subordinated notes, each holder of the senior
subordinated notes has the right to require that we purchase all or a portion of
such holder's senior subordinated notes at a purchase price equal to 101% of the
principal amount of the senior subordinated notes plus accrued and unpaid
interest to the date of purchase.

                                        69


     Covenants. The senior subordinated notes contain, among other things,
covenants limiting the incurrence of additional indebtedness, the issuance of
preferred stock, the payment of certain dividends and other restricted payments,
certain sales of assets, the payment of dividends and certain other payments by
certain subsidiaries, the issuance of capital stock by certain subsidiaries, the
creation of certain liens and certain transactions with affiliates, and other
customary provisions.

     Events of Default. The following events would be an event of default under
the senior subordinated notes:

     - the failure to pay interest on the senior subordinated notes when the
       same becomes due and payable and the default continues for a period of 30
       days;

     - the failure to pay the principal of or premium on any senior subordinated
       note when due, if any;

     - the failure to perform or comply with:

      - limitations concerning the consolidation, merger or disposal of all or
        substantially all of our assets;

      - limitations concerning the issuance of additional indebtedness and/or
        preferred stock by us or any of our subsidiaries;

      - limitations concerning the payment of dividends and/or special
        distributions to our shareholders, our redemption of any outstanding
        equity interest for value, or our principal payment of any outstanding
        indebtedness subordinate to the senior subordinated notes;

      - our obligation to buy back the senior subordinated notes in the event of
        a change in control; or

      - limitations concerning certain dispositions of our assets or the assets
        of our subsidiaries to another corporation, person or entity;

      in each case, within the time periods specified in the indenture relating
      to the senior subordinated notes;

     - the default in the performance, or breach, of any covenant or agreement
       of us or any subsidiary guarantor, other than a default in the
       performance, or breach, of a covenant or agreement that is specifically
       dealt with elsewhere in the indenture related to the senior subordinated
       notes, and the default or breach continues for a period of 60 days after
       the trustee has given us or the holders of at least 25% aggregate
       principal amount of the senior subordinated notes then outstanding have
       given us and the trustee a written notice specifying such default or
       breach and requiring it to be remedied and stating that such notice is a
       "Notice of Default;"

     - an event of default under any mortgage, indenture or instrument under
       which there may be issued or by which there may be secured or evidenced
       any indebtedness for money borrowed by us or any of our restricted
       subsidiaries (or the payment of which is guaranteed by us or any of our
       restricted subsidiaries), which default:

      - is caused by a failure to pay principal of such indebtedness at final
        maturity of such indebtedness; or

      - results in the acceleration of such indebtedness prior to its express
        maturity; and

      in each case, the principal amount of any such indebtedness, together with
      the principal amount of any other such indebtedness as to which there has
      been a payment default or the maturity of which has been so accelerated,
      exceeds in the aggregate $20 million;

     - the failure by us or any of our restricted subsidiaries to pay one or
       more final judgments the uninsured portion of which exceeds in the
       aggregate $20,000,000, which judgment or judgments are not paid,
       discharged or stayed for a period of 60 days;

                                        70


     - any judicial proceeding holds any guarantee of the senior subordinated
       notes to be unenforceable or invalid or any guarantee of the senior
       subordinated notes ceases to be in full force and effect, other than in
       accordance with the terms of the indenture related to the senior
       subordinated notes, or any such guarantor denies that it has any further
       liability under any senior subordinated note guarantee, or gives notice
       to such effect, other than by reason of the termination of the indenture
       related to the senior subordinated notes or the release of any such
       senior subordinated note guarantee in accordance with the indenture
       related to the senior subordinated notes;

     - the entry of a decree or order by a court having jurisdiction adjudging
       us or any restricted subsidiary as bankrupt or insolvent, or approving as
       properly filed a petition seeking reorganization, arrangement,
       adjustments or composition of or in respect of us or any restricted
       subsidiary under the Federal Bankruptcy Code or any other applicable
       federal or state law, or appointing a receiver, trustee or other similar
       official of us or any restricted subsidiary or of any substantial part of
       our property, or ordering the winding up or liquidation of our affairs,
       and any such decree or order continues unstayed and in effect for a
       period of 90 consecutive days; or

     - our institution or any restricted subsidiary's institution of proceedings
       to be adjudicated as bankrupt or insolvent, or the consent by us or them
       to the institution of bankruptcy or insolvency proceedings against us or
       them, or the filings by us or them of a petition or answer or consent
       seeking reorganization or relief under the Federal Bankruptcy Code or any
       other applicable federal or state law, or the consent by us or them to
       the filing of any such petition or to the appointment of a receiver,
       trustee or other similar official of us or them or of any substantial
       part of our or their property, or the making by us or them of an
       assignment for the benefit of creditors, or the admission by us or them
       in writing of our or their inability to pay our or their debts generally
       as they become due.

     If an event of default shall occur and be continuing, other than a default
upon certain events of bankruptcy or insolvency, the trustee or the holders of
at least 25% in aggregate principal amount of outstanding senior subordinated
notes may, and the trustee at the request of such holders will, declare the
principal of and accrued interest on all the outstanding senior subordinated
notes to be immediately due and payable and, upon any such declaration, such
principal and such interest will become due and payable immediately.

     If an event of default occurs because a court declares us or any of our
restricted subsidiaries bankrupt or insolvent or because we or any of our
restricted subsidiaries institute bankruptcy or insolvency proceedings and, in
each case, the default is continuing, then the principal of and accrued interest
on all of the outstanding senior subordinated notes will automatically become
and be immediately due and payable without any declaration or other act by the
trustee or any holder of the senior subordinated notes.

INDUSTRIAL DEVELOPMENT REVENUE BONDS

     In connection with some of our acquisitions and related improvements, we
have borrowed the proceeds of industrial revenue bonds issued by various cities
in Minnesota and one city in Pennsylvania that cover the purchase price of such
acquired businesses. As of March 31, 2002, approximately $33.5 million of these
bonds were outstanding and senior to our outstanding long-term indebtedness,
including the notes and our senior subordinated notes. The bonds mature between
2008 and 2014 and have interest rates between 1.40% and 6.25%. Four of the bonds
with principal amounts aggregating $32.0 million are secured by irrevocable
letters of credit totaling $33.0 million, which remained outstanding following
the issuance of the old notes.

OTHER DEBT

     As of March 31, 2002, we had $5.2 million of other senior debt, $3.9
million of which was in the form of mortgage notes held by a seller of certain
facilities in Indiana. The mortgage debt has an interest rate of 7.25% and
matures in 2007. The remaining indebtedness is related to capital leases,
promissory notes and other obligations.
                                        71


                          DESCRIPTION OF THE NEW NOTES

     We issued the old notes and we will issue the new notes under an indenture
among us, the Subsidiary Guarantors and U.S. Bank, N.A., as trustee. We refer to
the old notes and the new notes collectively as the notes. The terms of the
notes include those stated in the indenture and those made part of the indenture
by reference to the Trust Indenture Act of 1939.

     The following description is a summary of the material provisions of the
indenture. It does not include all of the provisions of the indenture. We urge
you to read the indenture because it, and not this description, defines your
rights as holders of the notes. We have filed the indenture as an exhibit to the
registration statement of which this prospectus is a part. Copies of the
indenture are available as set forth below under "-- Additional Information."
Certain defined terms used in this description but not defined below under
"-- Certain Definitions" have the meanings assigned to them in the indenture. In
this description, "we," "us" and "our" refer only to Extendicare Health
Services, Inc. and not to any of its subsidiaries.

     The registered Holder of a note will be treated as its owner of for all
purposes. Only registered Holders will have rights under the indenture.

BRIEF DESCRIPTION OF THE NOTES AND THE GUARANTEES

THE NOTES

     The old notes are, and the new notes will be:

     - our general unsecured obligations;

     - senior in right of payment to all of our existing and any future
       subordinated Indebtedness, including the Senior Subordinated Notes;

     - pari passu in right of payment with all of our existing and any future
       unsecured Indebtedness that is not by its terms expressly subordinated to
       the notes;

     - effectively junior in right of payment to our existing and future secured
       Indebtedness, including up to $105.0 million under the Credit Agreement,
       to the extent of the value of the collateral securing that Indebtedness;
       and

     - guaranteed by all of our existing and future domestic Significant
       Subsidiaries, all of our existing and future Domestic Subsidiaries that
       guarantee or incur any Indebtedness and any other existing or future
       Significant Subsidiaries or Restricted Subsidiaries that guarantee or
       otherwise provide direct credit support for Indebtedness of ours or any
       of our Domestic Subsidiaries.

THE SUBSIDIARY GUARANTEES

     Each subsidiary guarantee of the old notes is, and each subsidiary
guarantee of the new notes will be:

     - a senior unsecured obligation of each Subsidiary Guarantor;

     - senior in right of payment to all existing and any future subordinated
       Indebtedness, including the guarantees of the outstanding Senior
       Subordinated Notes, of that Subsidiary Guarantor;

     - pari passu in right of payment with all existing and any future
       Indebtedness of that Subsidiary Guarantor that is not by its terms
       expressly subordinated to the guarantee of the notes; and

     - effectively junior in right of payment to the existing and future secured
       Indebtedness of that Subsidiary Guarantor, including the guarantee of our
       Credit Agreement, to the extent of the value of the collateral securing
       that Indebtedness.

     As of the date of the indenture, all of our existing subsidiaries were
"Restricted Subsidiaries." However, under the circumstances described below
under "-- Designation of Restricted and Unrestricted Subsidiaries," we are
permitted to designate certain of our subsidiaries as "Unrestricted
Subsidiaries."

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Unrestricted Subsidiaries will not be subject to many of the restrictive
covenants in the indenture and will not guarantee the notes.

     As of March 31, 2002, assuming the issuance of the old notes had been
completed at that time, and giving effect to the application of the net proceeds
from that issuance, we would have had approximately $388.7 million of
Indebtedness outstanding on a consolidated basis (including the old notes),
approximately $37.5 million of which would have been secured. Prior to replacing
$40.1 million of letters of credit under the old credit facility with new
letters of credit at the closing of the new credit facility, we had undrawn
borrowing capacity of $105.0 million under the Credit Agreement.

PRINCIPAL, MATURITY AND INTEREST

     We will initially issue up to $150.0 million in aggregate principal amount
of new notes in exchange for a like amount of old notes. We may issue additional
notes from time to time after this offering. Any offering of additional notes is
subject to the "-- Incurrence of Indebtedness and Issuance of Preferred Stock"
covenant described below. The notes and any additional notes subsequently issued
under the indenture will be treated as a single class for all purposes under the
indenture, including, without limitation, waivers, amendments, redemptions and
offers to purchase. We will issue notes in denominations of $1,000 and integral
multiples of $1,000. The notes will mature on July 1, 2010.

     Interest on the notes will accrue at the rate of 9 1/2% per annum and will
be payable semi-annually in arrears on January 1 and July 1, commencing on
January 1, 2003. We will make each interest payment to the Holders of record on
the immediately preceding December 15 and June 15.

     Interest on the notes will accrue from the date of original issuance of the
old notes or, if interest has already been paid, from the date it was most
recently paid. Interest will be computed on the basis of a 360-day year
comprised of twelve 30-day months.

METHODS OF RECEIVING PAYMENTS ON THE NOTES

     If a Holder has given wire transfer instructions to us, we will pay all
principal, interest and premium, if any, on that Holder's notes in accordance
with those instructions. All other payments on notes will be made at the office
or agency of the paying agent and registrar within the City and State of New
York unless we elect to make interest payments by check mailed to the Holders at
their address set forth in the register of Holders.

PAYING AGENT AND REGISTRAR FOR THE NOTES

     The trustee will initially act as paying agent and registrar. We may change
the paying agent or registrar without prior notice to the Holders of the notes,
and we or any of our Subsidiaries may act as paying agent or registrar.

TRANSFER AND EXCHANGE

     A Holder may transfer or exchange notes in accordance with the indenture.
The registrar and the trustee may require a Holder to furnish appropriate
endorsements and transfer documents in connection with a transfer of notes.
Holders will be required to pay all taxes due on transfer. We are not required
to transfer or exchange any note selected for redemption. Also, we are not
required to transfer or exchange any note for a period of 15 days before a
selection of notes to be redeemed.

SUBSIDIARY GUARANTEES

     The old notes are, and the new notes will be, guaranteed on a senior
unsecured basis by all of our existing and future domestic Significant
Subsidiaries, all of our existing and future Domestic Subsidiaries that
guarantee or incur any Indebtedness and any other existing and future
Significant Subsidiaries or Restricted Subsidiaries that guarantee or otherwise
provide direct credit support for Indebtedness of ours or any of our Domestic
Subsidiaries. These Subsidiary Guarantees are and will be joint and several
                                        73


obligations of the Subsidiary Guarantors. The obligations of each Subsidiary
Guarantor under its Subsidiary Guarantee are and will be limited as necessary to
prevent that Subsidiary Guarantee from constituting a fraudulent conveyance
under applicable law, after giving effect to all other obligations of that
Subsidiary Guarantor including its guarantee of all obligations under the Credit
Agreement. See "Risk Factors -- Risks Related to the Exchange Offer and the New
Notes -- A court may void the guarantees of the notes or subordinate the
guarantees to other obligations of our subsidiary guarantors."

     A Subsidiary Guarantor may not sell or otherwise dispose of all or
substantially all of its assets to, or consolidate with or merge with or into
(whether or not such Subsidiary Guarantor is the surviving Person), another
Person, other than us or another Subsidiary Guarantor, unless:

          (1) immediately after giving effect to that transaction, no Default or
     Event of Default exists; and

          (2) either:

             (a) the Person acquiring the property in any such sale or
        disposition or the Person formed by or surviving any such consolidation
        or merger assumes all the obligations of that Subsidiary Guarantor under
        the indenture, its Subsidiary Guarantee and the registration rights
        agreement pursuant to a supplemental indenture satisfactory to the
        trustee; or

             (b) the Net Proceeds of such sale or other disposition are applied
        in accordance with the provisions of the indenture relating to Asset
        Sales.

     The Subsidiary Guarantee of a Subsidiary Guarantor will be released:

          (1) in connection with any sale or other disposition of all or
     substantially all of the assets of that Subsidiary Guarantor (including by
     way of merger or consolidation) to a Person that is not (either before or
     after giving effect to such transaction) a Subsidiary of ours, if the sale
     or other disposition complies with the provisions of the indenture relating
     to Asset Sales;

          (2) in connection with any sale of all of the Capital Stock of a
     Subsidiary Guarantor to a Person that is not (either before or after giving
     effect to such transaction) a Subsidiary of ours, if the sale complies with
     the provisions of the indenture relating to Asset Sales; or

          (3) if we designate any Restricted Subsidiary that is a Subsidiary
     Guarantor as an Unrestricted Subsidiary in accordance with the applicable
     provisions of the indenture.

     See "-- Repurchase at the Option of Holders -- Asset Sales."

OPTIONAL REDEMPTION

     On or prior to July 1, 2005, we may on one or more occasions redeem up to
35% of the aggregate principal amount of notes issued under the indenture at a
redemption price of 109.500% of the principal amount thereof, plus accrued and
unpaid interest and Liquidated Damages, if any, to the redemption date, with the
net cash proceeds of any Qualified Equity Offering of our common stock; provided
that:

          (1) at least 65% of the aggregate principal amount of notes issued
     under the indenture remains outstanding immediately after the occurrence of
     such redemption (excluding notes held by us and our Subsidiaries); and

          (2) the redemption occurs within 90 days of the date of the closing of
     such Qualified Equity Offering.

     Except pursuant to the preceding paragraph, the notes will not be
redeemable at our option prior to July 1, 2006.

     On or after July 1, 2006, we may redeem all or a part of the notes upon not
less than 30 nor more than 60 days' notice, at the redemption prices (expressed
as percentages of principal amount) set forth

                                        74


below plus accrued and unpaid interest on the notes redeemed, to the applicable
redemption date, if redeemed during the twelve-month period beginning on July 1
of the years indicated below:



YEAR                                                           PERCENTAGE
- ----                                                           ----------
                                                            
2006........................................................    104.750%
2007........................................................    102.375%
2008 and thereafter.........................................    100.000%


MANDATORY REDEMPTION

     We are not required to make mandatory redemption or sinking fund payments
with respect to the notes.

REPURCHASE AT THE OPTION OF HOLDERS

CHANGE OF CONTROL

     If a Change of Control occurs, each Holder of notes will have the right to
require us to repurchase all or any part (equal to $1,000 or an integral
multiple of $1,000) of that Holder's notes pursuant to a Change of Control Offer
on the terms set forth in the indenture. In the Change of Control Offer, we will
offer a Change of Control Payment in cash equal to 101% of the aggregate
principal amount of notes repurchased plus accrued and unpaid interest on the
notes repurchased, to the date of purchase. Subject to compliance with the
provisions of the third succeeding paragraph, within 30 days following any
Change of Control, we will mail a notice to the trustee and each Holder
describing the transaction or transactions that constitute the Change of Control
and offering to repurchase notes on the Change of Control Payment Date specified
in the notice, which date will be no earlier than 30 days and no later than 60
days from the date such notice is mailed, pursuant to the procedures required by
the indenture and described in such notice. We will comply with the requirements
of Rule 14e-1 under the Exchange Act and any other securities laws and
regulations thereunder to the extent those laws and regulations are applicable
in connection with the repurchase of the notes as a result of a Change of
Control. To the extent that the provisions of any securities laws or regulations
conflict with the Change of Control provisions of the indenture, we will comply
with the applicable securities laws and regulations and will not be deemed to
have breached our obligations under the Change of Control provisions of the
indenture by virtue of such conflict.

     On the Change of Control Payment Date, we will, to the extent lawful:

          (1) accept for payment all notes or portions of notes properly
     tendered pursuant to the Change of Control Offer;

          (2) deposit with the paying agent an amount equal to the Change of
     Control Payment in respect of all notes or portions of notes properly
     tendered; and

          (3) deliver or cause to be delivered to the trustee the notes properly
     accepted together with an officers' certificate stating the aggregate
     principal amount of notes or portions of notes being purchased by us.

     The paying agent will promptly mail to each Holder of notes properly
tendered the Change of Control Payment for such notes, and the trustee will
promptly authenticate and mail (or cause to be transferred by book entry) to
each Holder a new note equal in principal amount to any unpurchased portion of
the notes surrendered, if any; provided that each new note will be in a
principal amount of $1,000 or an integral multiple of $1,000.

     Prior to complying with any of the provisions of this "Change of Control"
covenant, but in any event within 90 days following a Change of Control, we will
either repay all outstanding Senior Debt or obtain the requisite consents, if
any, under all agreements governing outstanding Senior Debt to permit the

                                        75


repurchase of notes required by this covenant. We will publicly announce the
results of the Change of Control Offer on or as soon as practicable after the
Change of Control Payment Date.

     The provisions described above that require us to make a Change of Control
Offer following a Change of Control will be applicable whether or not any other
provisions of the indenture are applicable. Except as described above with
respect to a Change of Control, the indenture does not contain provisions that
permit the Holders of the notes to require that we repurchase or redeem the
notes in the event of a takeover, recapitalization or similar transaction.

     We will not be required to make a Change of Control Offer upon a Change of
Control if a third party makes the Change of Control Offer in the manner, at the
times and otherwise in compliance with the requirements set forth in the
indenture applicable to a Change of Control Offer made by us and purchases all
notes properly tendered and not withdrawn under the Change of Control Offer.

     The definition of Change of Control includes a phrase relating to the
direct or indirect sale, lease, transfer, conveyance or other disposition of
"all or substantially all" of our properties or assets and the properties or
assets of our Subsidiaries taken as a whole. Although there is a limited body of
case law interpreting the phrase "substantially all," there is no precise
established definition of the phrase under applicable law. Accordingly, the
ability of a Holder of notes to require us to repurchase its notes as a result
of a sale, lease, transfer, conveyance or other disposition of less than all of
our assets and the assets of our Subsidiaries taken as a whole to another Person
or group may be uncertain.

ASSET SALES

     We will not, and will not permit any of our Restricted Subsidiaries to,
consummate an Asset Sale unless:

          (1) we (or the Restricted Subsidiary, as the case may be) receive
     consideration at the time of the Asset Sale at least equal to the fair
     market value of the assets sold or otherwise disposed of (evidenced by a
     resolution of our Board of Directors set forth in an officers' certificate
     delivered to the trustee);

          (2) if we (or the Restricted Subsidiary, as the case may be) receive
     consideration at the time of the Asset Sale greater than $7.5 million, the
     fair market value of the assets sold or otherwise disposed of is determined
     by Parent's Board of Directors (such determination to be evidenced by a
     resolution set forth in an officers' certificate delivered to the trustee)
     or in a written opinion issued by an independent appraisal firm or
     financial advisor of national standing; and

          (3) at least 75% of the consideration received in the Asset Sale by us
     or such Restricted Subsidiary is in the form of cash, Cash Equivalents or
     Replacement Assets.

     For purposes of this provision only, each of the following will be deemed
to be cash:

          (a) any liabilities of ours or any of our Restricted Subsidiaries, as
     shown on our or such Restricted Subsidiary's most recent balance sheet
     (other than contingent liabilities and liabilities that are by their terms
     subordinated to the notes or any Restricted Subsidiary's Subsidiary
     Guarantee), that are assumed by the transferee of any such assets pursuant
     to a customary novation agreement that releases us or such Restricted
     Subsidiary from further liability;

          (b) any securities, notes or other obligations received by us or any
     such Restricted Subsidiary from such transferee that are contemporaneously,
     subject to ordinary settlement periods, converted by us or such Restricted
     Subsidiary into cash, to the extent of the cash received in that
     conversion; and

          (c) any Designated Non-Cash Consideration received by us or any of our
     Restricted Subsidiaries in the Asset Sale.

                                        76


     Within 365 days after the receipt of any Net Proceeds from an Asset Sale,
we and our Restricted Subsidiaries may apply those Net Proceeds at our option:

          (1) to repay Senior Debt and, if the Senior Debt repaid is revolving
     credit Indebtedness, to correspondingly permanently reduce commitments with
     respect thereto;

          (2) to acquire all or substantially all of the assets of, or a
     majority of the Voting Stock of, another Permitted Business; or

          (3)  to acquire other long-term assets that are used or useful in a
     Permitted Business.

     Pending the final application of any Net Proceeds, we may temporarily
reduce revolving credit borrowings or otherwise invest the Net Proceeds in any
manner that is not prohibited by the indenture.

     Any Net Proceeds from Asset Sales that are not applied or invested within
such 365-day period will constitute "Excess Proceeds." When the aggregate amount
of Excess Proceeds exceeds $15.0 million, we will make an offer (which offer may
be made at any time within such 365-day period) to all holders of notes and
Additional Notes, if any, and all holders of other Indebtedness that is pari
passu with the notes containing provisions similar to those set forth in the
indenture with respect to offers to purchase or redeem with the proceeds of
sales of assets (an "Asset Sale Offer"), to purchase, on a pro rata basis, the
maximum principal amount of notes and Additional Notes, if any, and such other
pari passu Indebtedness equal in amount to the Excess Proceeds (and not just the
amount thereof that exceeds $15.0 million). The offer price in any Asset Sale
Offer will be equal to 100% of the principal amount thereof plus accrued and
unpaid interest to the date of purchase, in accordance with the procedures set
forth in the indenture, and will be payable in cash. If any Excess Proceeds
remain after consummation of an Asset Sale Offer, we may use those Excess
Proceeds for any purpose not otherwise prohibited by the indenture. If the
aggregate principal amount of notes and Additional Notes, if any, and other pari
passu Indebtedness surrendered by holders thereof exceeds the amount of Excess
Proceeds, the trustee will select the notes and Additional Notes and other pari
passu Indebtedness to be purchased as described below under "Selection and
Notice." Upon completion of each Asset Sale Offer, the amount of Excess Proceeds
will be reset at zero.

     We will comply with the requirements of Rule 14e-1 under the Exchange Act
and any other securities laws and regulations thereunder to the extent those
laws and regulations are applicable in connection with each repurchase of notes
pursuant to an Asset Sale Offer. To the extent that the provisions of any
securities laws or regulations conflict with the Asset Sale provisions of the
indenture, we will comply with the applicable securities laws and regulations
and will not be deemed to have breached our obligations under the Asset Sale
provisions of the indenture by virtue of such conflict.

SELECTION AND NOTICE

     If less than all of the notes are to be redeemed or purchased at any time,
the trustee will select notes for redemption or purchase as follows:

          (1) if the notes are listed on any national securities exchange, in
     compliance with the requirements of the principal national securities
     exchange on which the notes are listed; or

          (2) if the notes are not listed on any national securities exchange,
     on a pro rata basis, by lot or by such method as the trustee deems fair and
     appropriate.

     No notes of $1,000 or less can be redeemed in part.  Notices of redemption
will be mailed by first class mail at least 30 but not more than 60 days before
the redemption date to each Holder of notes to be redeemed at its registered
address, except that redemption notices may be mailed more than 60 days prior to
a redemption date if the notice is issued in connection with a defeasance of the
notes or a satisfaction and discharge of the indenture. Notices of redemption
may not be conditional.

     If any note is to be redeemed in part only, the notice of redemption that
relates to that note will state the portion of the principal amount of that note
that is to be redeemed. A new note in principal amount equal to the unredeemed
portion of the original note will be issued in the name of the Holder of notes

                                        77


upon cancellation of the original note. Notes called for redemption become due
on the date fixed for redemption. On and after the redemption date, interest
ceases to accrue on notes or portions of them called for redemption.

CERTAIN COVENANTS

RESTRICTED PAYMENTS

     We will not, and will not permit any of our Restricted Subsidiaries to,
directly or indirectly:

          (1) declare or pay any dividend or make any other payment or
     distribution on account of our Equity Interests (including, without
     limitation, any payment in connection with any merger or consolidation in
     which we are involved) or to the direct or indirect holders of our Equity
     Interests in their capacity as such (other than dividends or distributions
     payable solely in our Equity Interests (other than Disqualified Stock) or
     to us);

          (2) purchase, redeem or otherwise acquire or retire for value
     (including, without limitation, in connection with any merger or
     consolidation in which we are involved) any of our Equity Interests;

          (3) make any payment on or with respect to, or purchase, redeem,
     defease or otherwise acquire or retire for value any Subordinated
     Indebtedness, except (A) a payment of interest or principal at the Stated
     Maturity thereof or (B) Subordinated Indebtedness acquired in anticipation
     of satisfying a sinking fund obligation, principal installment or payment
     of principal upon final maturity of such Subordinated Indebtedness, in each
     case acquired within one year of the date of the sinking fund obligation,
     principal installment or payment of principal upon maturity; or

          (4) make any Restricted Investment

(all such payments and other actions set forth in these clauses (1) through (4)
above being collectively referred to as "Restricted Payments"), unless, at the
time of and after giving effect to such Restricted Payment:

          (a) no Default or Event of Default has occurred and is continuing or
     would occur as a consequence of such Restricted Payment;

          (b) we would, at the time of such Restricted Payment and after giving
     pro forma effect thereto as if such Restricted Payment had been made at the
     beginning of the applicable four-quarter period, have been permitted to
     incur at least $1.00 of additional Indebtedness pursuant to the Fixed
     Charge Coverage Ratio test set forth in the first paragraph of the
     "Incurrence of Indebtedness and Issuance of Preferred Stock" covenant; and

          (c) such Restricted Payment, together with the aggregate amount of all
     other Restricted Payments made by us and our Restricted Subsidiaries after
     the date of the indenture (excluding Restricted Payments permitted by
     clauses (2) and (3) of the next paragraph), is less than the sum, without
     duplication, of:

             (I) 50% of our Consolidated Net Income for the period (taken as one
        accounting period) from April 1, 2002 to the end of our most recently
        ended fiscal quarter for which internal financial statements are
        available at the time of such Restricted Payment (or, if such
        Consolidated Net Income for such period is a deficit, less 100% of such
        deficit), plus

             (II) 100% of the aggregate net cash proceeds received by us since
        the date of the indenture from the issue or sale of our Equity Interests
        (other than Disqualified Stock) or Equity Interests of any of our parent
        entities (which proceeds are received as a contribution to our common or
        non-redeemable preferred equity capital) or from the issue or sale of
        convertible or exchangeable Disqualified Stock or convertible or
        exchangeable debt securities of ours that have been converted into or
        exchanged for such Equity Interests (other than Equity Interests or
        Disqualified Stock or debt securities sold to a Subsidiary of ours);
        plus

                                        78


             (III) to the extent that any Restricted Investment that was made
        after the date of the indenture is sold for cash or otherwise liquidated
        or repaid for cash, the lesser of (A) the cash return of capital with
        respect to such Restricted Investment (less the cost of disposition, if
        any) and (B) the initial amount of such Restricted Investment.

     So long as no Default has occurred and is continuing or would be caused
thereby, the preceding provisions will not prohibit:

          (1) the payment of any dividend within 60 days after the date of
     declaration of the dividend, if at the date of declaration the dividend
     payment would have complied with the provisions of the indenture;

          (2) the redemption, repurchase, retirement, defeasance or other
     acquisition of any Subordinated Indebtedness or of any of our Equity
     Interests by conversion into, or by an exchange for, shares of our Equity
     Interests (other than Disqualified Stock), or in exchange for, or out of
     the net cash proceeds of the substantially concurrent sale (other than to
     any of our Restricted Subsidiaries) of, our Equity Interests (other than
     Disqualified Stock); provided that the amount of any such net cash proceeds
     that are utilized for any such redemption, repurchase, retirement,
     defeasance or other acquisition will be excluded from clause (c)(II) of the
     preceding paragraph;

          (3) the repurchase, retirement, or redemption of any Subordinated
     Indebtedness with the proceeds from an Asset Sale to the extent required by
     the agreement governing such Subordinated Indebtedness but only (a) if we
     have complied with the covenant described under "Repurchase at the Option
     of Holders -- Asset Sales" and (b) to the extent of the Excess Proceeds
     remaining after the offer made to holders of the notes pursuant to the
     Asset Sale;

          (4) the defeasance, redemption, repurchase or other acquisition of
     Subordinated Indebtedness with the net cash proceeds from an incurrence of
     Permitted Refinancing Indebtedness; and

          (5) other Restricted Payments in an aggregate amount since the date of
     the indenture not to exceed $10.0 million.

     The amount of all Restricted Payments (other than cash) will be the fair
market value on the date of the Restricted Payment of the asset(s) or securities
proposed to be transferred or issued by us or such Restricted Subsidiary, as the
case may be, pursuant to the Restricted Payment. The fair market value of any
assets or securities that are required to be valued by this covenant will be
determined by our Board of Directors, whose resolutions with respect thereto
will be delivered to the trustee. The Board of Directors' determination must be
based upon an opinion or appraisal issued by an accounting, appraisal or
investment banking firm of national standing if the fair market value exceeds
$5.0 million. Not later than the date of making any Restricted Payment, we will
deliver to the trustee an officers' certificate stating that such Restricted
Payment is permitted and setting forth the basis upon which the calculations
required by this "Restricted Payments" covenant were computed, together with a
copy of any fairness opinion or appraisal required by the indenture.

INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF PREFERRED STOCK

     We will not, and will not permit any of our Restricted Subsidiaries to,
directly or indirectly, create, incur, issue, assume, guarantee or otherwise
become directly or indirectly liable, contingently or otherwise, with respect to
(collectively, "incur") any Indebtedness (including Acquired Debt), and we will
not issue any Disqualified Stock and will not permit any of our Restricted
Subsidiaries to issue any shares of preferred stock; provided, however, that we
may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock,
and any of our Subsidiary Guarantors may incur Indebtedness, if the Fixed Charge
Coverage Ratio for our most recently ended four full fiscal quarters for which
internal financial statements are available immediately preceding the date on
which such additional Indebtedness is incurred or such Disqualified Stock is
issued would have been at least 2.00 to 1, determined on a pro forma basis
(including a pro forma application of the net proceeds therefrom), as if the
additional Indebtedness had been

                                        79


incurred or the preferred stock or Disqualified Stock had been issued, as the
case may be, at the beginning of such four-quarter period.

     The first paragraph of this covenant will not prohibit the incurrence of
any of the following items of Indebtedness (collectively, "Permitted Debt"):

          (1) our incurrence of additional Indebtedness and letters of credit
     under Credit Facilities and Guarantees thereof by the Subsidiary
     Guarantors; provided that the aggregate principal amount of all
     Indebtedness of ours and our Restricted Subsidiaries incurred pursuant to
     this clause (1) (with letters of credit being deemed to have a principal
     amount equal to the maximum potential liability of us and our Subsidiary
     Guarantors thereunder) does not exceed an amount equal to $105.0 million
     less (a) 50% of all proceeds received from Securitization Transactions and
     (b) the aggregate amount of Net Proceeds from an Asset Sale applied by us
     and our Restricted Subsidiaries since the date of the indenture to repay
     Indebtedness thereunder or to permanently reduce the availability of
     revolving credit Indebtedness pursuant to the provisions described above
     under the heading "-- Repurchase at the Option of Holders -- Asset Sales;"

          (2) the incurrence by us and our Restricted Subsidiaries of the
     Existing Indebtedness;

          (3) the incurrence by us of Indebtedness represented by the notes and
     the incurrence by the Subsidiary Guarantors of the Subsidiary Guarantees of
     the notes;

          (4) the incurrence by us or any of our Subsidiary Guarantors of
     Indebtedness represented by Capital Lease Obligations, mortgage financings
     or purchase money obligations, in each case incurred for the purpose of
     financing all or any part of the purchase price or cost of construction or
     improvement of property, plant or equipment used in our business or the
     business of such Subsidiary Guarantor, in an aggregate principal amount,
     including all Permitted Refinancing Indebtedness incurred to refund,
     refinance or replace any Indebtedness incurred pursuant to this clause (4),
     not to exceed 3.5% of Consolidated Tangible Assets at any time outstanding;

          (5) the incurrence by us or any of our Restricted Subsidiaries of
     Permitted Refinancing Indebtedness in exchange for, or the net proceeds of
     which are used to refund, refinance or replace Indebtedness (other than
     intercompany Indebtedness) that was incurred under the first paragraph of
     this covenant or clauses (2), (3), (4) or (10) of this paragraph;

          (6) the incurrence by us or any of our Restricted Subsidiaries of
     intercompany Indebtedness owed to us or any of the Subsidiary Guarantors;
     provided, however, that:

             (a) if we are the obligor on such Indebtedness, such Indebtedness
        must be expressly subordinated to the prior payment in full in cash of
        all Obligations with respect to the notes;

             (b) if a Subsidiary Guarantor is the obligor on such Indebtedness,
        such Indebtedness is expressly subordinated to the prior payment in full
        in cash of such Subsidiary Guarantor's Subsidiary Guarantee; and

             (c) (i) any subsequent issuance or transfer of Equity Interests
        that results in any such Indebtedness being held by a Person other than
        us or a Subsidiary Guarantor and (ii) any sale or other transfer of any
        such Indebtedness to a Person that is not either us or a Subsidiary
        Guarantor will be deemed, in each case, to constitute an incurrence of
        such Indebtedness by us or such Subsidiary Guarantor, as the case may
        be, that was not permitted by this clause (6);

          (7) the incurrence by us or any of our Restricted Subsidiaries of
     Hedging Obligations that are incurred in the normal course of business for
     the purpose of fixing or hedging currency, commodity or interest rate risk
     (including with respect to any floating rate Indebtedness that is permitted
     by the terms of the indenture to be outstanding in connection with the
     conduct of our respective businesses and not for speculative purposes);

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          (8) the guarantee by us or any of the Subsidiary Guarantors of our
     Indebtedness or Indebtedness of one of our Restricted Subsidiaries that was
     permitted to be incurred by another provision of this covenant;

          (9) the incurrence by our Unrestricted Subsidiaries of Non-recourse
     Debt; provided, however, that if any such Indebtedness ceases to be
     Non-recourse Debt of an Unrestricted Subsidiary, such event will be deemed
     to be an incurrence of Indebtedness by a Restricted Subsidiary of ours that
     was not permitted by this clause (9); and

          (10) the incurrence by us or any of our Restricted Subsidiaries of
     additional Indebtedness in an aggregate principal amount (or accreted
     value, as applicable) at any time outstanding, including all Permitted
     Refinancing Indebtedness incurred to refund, refinance or replace any
     Indebtedness incurred pursuant to this clause (10), not to exceed $25.0
     million (which amount may be incurred, in whole or in part, under any of
     the Credit Facilities); provided that no more than $10.0 million of such
     additional Indebtedness shall be incurred by Restricted Subsidiaries that
     are not Subsidiary Guarantors.

     For purposes of determining compliance with this covenant, in the event
that an item of proposed Indebtedness meets the criteria of more than one of the
categories of Permitted Debt described in clauses (1) through (10) above as of
the date of incurrence thereof or is entitled to be incurred pursuant to the
first paragraph of this covenant, we will, in our sole discretion, at the time
the proposed Indebtedness is incurred, (x) classify all or a portion of that
item of Indebtedness on the date of its incurrence under either the first
paragraph of this covenant or under any category of Permitted Debt, (y)
reclassify at a later date all or a portion of that or any other item of
Indebtedness as being or having been incurred in any manner that complies with
this covenant and (z) elect to comply with this covenant and the applicable
definitions in any order.

     We will not incur, create, issue, assume, guarantee or otherwise become
liable for any Indebtedness that is subordinate or junior in right of payment to
any Senior Debt of ours and not subordinate or junior in right of payment to the
notes; provided, however, that no Indebtedness of ours will be deemed to be
contractually subordinated in right of payment solely by virtue of being
unsecured. No Subsidiary Guarantor will incur, create, issue, assume, guarantee
or otherwise become liable for any Indebtedness that is subordinate or junior in
right of payment to the Senior Debt of such Subsidiary Guarantor and not
subordinate or junior in right of payment to such Subsidiary Guarantor's
Subsidiary Guarantee; provided, however, that no Indebtedness of a Subsidiary
Guarantor will be deemed to be contractually subordinated in right of payment
solely by virtue of being unsecured.

     Indebtedness will be deemed to have been incurred by the survivor of a
merger, at the time of such merger and, with respect to an acquired Subsidiary,
at the time of such acquisition.

LIENS

     We will not, and will not permit any of our Restricted Subsidiaries to,
directly or indirectly, create, incur, assume or suffer to exist any Lien of any
kind securing Indebtedness, Attributable Debt or trade payables on any asset now
owned or hereafter acquired or any proceeds therefrom, or assign or convey any
right to receive income therefrom, except Permitted Liens.

DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING RESTRICTED SUBSIDIARIES

     We will not, and will not permit any of our Restricted Subsidiaries to,
directly or indirectly, create or permit to exist or become effective any
consensual encumbrance or restriction on the ability of any Restricted
Subsidiary to:

          (1) pay dividends or make any other distributions on or in respect of
     its Capital Stock to us or any of our Restricted Subsidiaries, or with
     respect to any other interest or participation in, or measured by, its
     profits, or pay any Indebtedness owed to us or any other of our Restricted
     Subsidiaries;
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          (2) make any loans or advances to us or any other of our Restricted
     Subsidiaries; or

          (3) sell, lease or transfer any of its properties or assets to us or
     any other of our Restricted Subsidiaries; or

          (4) guarantee our obligations.

     However, the preceding restrictions will not apply to encumbrances or
restrictions existing under or by reason of:

          (1) agreements as in effect on the date of the indenture or subsequent
     agreements relating to our Indebtedness or Indebtedness of any Subsidiary
     Guarantor and any amendments, modifications, restatements, renewals,
     increases, supplements, refundings, replacements or refinancings of those
     agreements; provided that the amendments, modifications, restatements,
     renewals, increases, supplements, refundings, replacement or refinancings
     are not materially more restrictive, taken as a whole, with respect to such
     dividend and other payment restrictions than those contained in those
     agreements on the date of the indenture;

          (2) the indenture, the notes and the Subsidiary Guarantees;

          (3) applicable law;

          (4) any instrument governing Indebtedness or Capital Stock of a Person
     acquired by us or any of our Restricted Subsidiaries as in effect at the
     time of such acquisition (except to the extent such Indebtedness or Capital
     Stock was incurred in connection with or in contemplation of such
     acquisition), which encumbrance or restriction is not applicable to any
     Person, or the properties or assets of any Person, other than the Person,
     or the property or assets of the Person, so acquired; provided that, in the
     case of Indebtedness, such Indebtedness was permitted by the terms of the
     indenture to be incurred;

          (5) customary non-assignment provisions in leases entered into in the
     ordinary course of business;

          (6) purchase money obligations for property acquired in the ordinary
     course of business that impose restrictions on that property of the nature
     described in clause (3) of the preceding paragraph;

          (7) any agreement for the sale or other disposition of a Restricted
     Subsidiary that restricts distributions by that Restricted Subsidiary
     pending its sale or other disposition;

          (8) Permitted Refinancing Indebtedness; provided that the restrictions
     contained in the agreements governing such Permitted Refinancing
     Indebtedness are not materially more restrictive, taken as a whole, than
     those contained in the agreements governing the Indebtedness being
     refinanced;

          (9) Liens securing Indebtedness otherwise permitted to be incurred
     under the provisions of the "Liens" covenant that limit the right of the
     debtor to dispose of the assets subject to such Liens; and

          (10) provisions with respect to the disposition or distribution of
     assets or property in joint venture agreements, asset sale agreements,
     stock sale agreements and other similar agreements entered into in the
     ordinary course of business.

ISSUANCES AND SALES OF CAPITAL STOCK OF RESTRICTED SUBSIDIARIES

     We will not, and will not permit any of our Restricted Subsidiaries to,
transfer, convey, sell, lease or otherwise dispose of any Capital Stock of any
of our Restricted Subsidiaries to any Person (other than to us or another
Restricted Subsidiary of ours), unless (i) such transfer, conveyance, sale,
lease or other disposition is of all the Capital Stock of such Restricted
Subsidiary, and (ii) the Net Proceeds from such transfer, conveyance, sale,
lease or other disposition are applied in accordance with the provisions
described above under "-- Repurchase at the Option of Holders -- Asset Sales;"
provided that this clause (a) will not apply to any pledge of Capital Stock of
any Restricted Subsidiary of ours securing Indebtedness under
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Credit Facilities, including the Credit Agreement, or any exercise of remedies
in connection therewith, and (b) will not permit any Restricted Subsidiary of
ours to issue any of its Equity Interests (other than, if necessary, shares of
its Capital Stock constituting directors' qualifying shares or ownership by
foreign nationals) to any Person other than us or another Restricted Subsidiary
of ours.

MERGER, CONSOLIDATION OR SALE OF ASSETS

     We may not, directly or indirectly: (1) consolidate or merge with or into
another Person (whether or not we are the surviving corporation) or (2) sell,
assign, transfer, convey or otherwise dispose of all or substantially all of our
properties or assets and the properties or assets of our Restricted Subsidiaries
taken as a whole, in one or more related transactions, to another Person;
unless:

          (a) either: (x) we are the surviving corporation; or (y) the Person
     formed by or surviving any such consolidation or merger (if other than us)
     or to which such sale, assignment, transfer, conveyance or other
     disposition has been made is a corporation organized or existing under the
     laws of the United States, any state of the United States or the District
     of Columbia;

          (b) the Person formed by or surviving any such consolidation or merger
     (if other than us) or the Person to which such sale, assignment, transfer,
     conveyance or other disposition has been made assumes all of our
     obligations under the notes and the indenture pursuant to a supplemental
     indenture reasonably satisfactory to the trustee;

          (c) immediately after such transaction no Default or Event of Default
     exists;

          (d) we or the Person formed by or surviving any such consolidation or
     merger (if other than us), or to which such sale, assignment, transfer,
     conveyance or other disposition has been made will, on the date of such
     transaction after giving pro forma effect thereto and any related financing
     transactions as if the same had occurred at the beginning of the applicable
     four-quarter period, be permitted to incur at least $1.00 of additional
     Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in
     the "Incurrence of Indebtedness and Issuance of Preferred Stock" covenant;
     and

          (e) we, or the Person formed by or surviving any such consolidation or
     merger (if other than us), or to which such sale, assignment, transfer,
     conveyance or other disposition has been made, will have delivered to the
     trustee an officers' certificate and an opinion of counsel, each stating
     that such transaction and any supplemental indenture entered into in
     connection therewith complies with all of the terms of this covenant and
     that all conditions precedent provided for in this covenant relating to
     such transaction or series of transactions have been complied with.

     In addition, we may not, directly or indirectly, lease all or substantially
all of our properties or assets, in one or more related transactions, to any
other Person.

     The Person formed by or surviving any consolidation or merger (if other
than us) will succeed to, and be substituted for, and may exercise every right
and power of ours under the indenture, but, in the case of a lease of all or
substantially all our assets, we will not be released from the obligation to pay
the principal of and interest on the notes.

DESIGNATION OF RESTRICTED AND UNRESTRICTED SUBSIDIARIES

     Our Board of Directors may designate any Restricted Subsidiary to be an
Unrestricted Subsidiary if that designation would not cause a Default. If a
Restricted Subsidiary is designated as an Unrestricted Subsidiary, the aggregate
fair market value of all outstanding Investments owned by us and our Restricted
Subsidiaries in the Subsidiary properly designated will be deemed to be an
Investment made as of the time of the designation and will reduce the amount
available for Restricted Payments under the first paragraph of the "Restricted
Payments" covenant or Permitted Investments, as determined by us. That
designation will only be permitted if the Investment would be permitted at that
time and if the Restricted Subsidiary otherwise meets the definition of an
Unrestricted Subsidiary. Our Board of Directors may

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redesignate any Unrestricted Subsidiary to be a Restricted Subsidiary if the
redesignation would not cause a Default.

TRANSACTIONS WITH AFFILIATES

     We will not, and will not permit any of our Restricted Subsidiaries to,
make any payment to, or sell, lease, transfer or otherwise dispose of any of our
or our Restricted Subsidiaries' respective properties or assets to, or purchase
any property or assets from, or enter into or make or amend any transaction,
contract, agreement, understanding, loan, advance or guarantee with, or for the
benefit of, any Affiliate (each, an "Affiliate Transaction"), unless:

          (1) the Affiliate Transaction is on terms that are no less favorable
     to us or the relevant Restricted Subsidiary than those that would have been
     obtained in a comparable transaction by us or such Restricted Subsidiary
     with a Person that is not an Affiliate; and

          (2) we deliver to the trustee:

             (a) with respect to any Affiliate Transaction or series of related
        Affiliate Transactions involving aggregate consideration in excess of
        $5.0 million, a resolution of our Board of Directors set forth in an
        officers' certificate certifying that such Affiliate Transaction
        complies with this covenant and that such Affiliate Transaction has been
        approved by a majority of the disinterested members of our Board of
        Directors or Parent's Board of Directors, or, if there are no
        disinterested members of the approving Board of Directors at the time, a
        written opinion issued by an independent appraisal firm or financial
        advisor of national standing that such Affiliate Transaction is fair to
        us or such Restricted Subsidiary, as the case may be, from a financial
        point of view; and

             (b) with respect to any Affiliate Transaction or series of related
        Affiliate Transactions involving aggregate consideration in excess of
        $10.0 million, a written opinion issued by an independent financial
        advisor of national standing that such Affiliate Transaction is fair to
        us or such Restricted Subsidiary, as the case may be, from a financial
        point of view.

     The following items will not be deemed to be Affiliate Transactions and,
therefore, will not be subject to the provisions of the prior paragraph:

          (1) transactions between or among us and/or our Restricted
     Subsidiaries;

          (2) transactions with a Person that is an Affiliate of ours solely
     because we own an Equity Interest in such Person;

          (3) advances to our officers or officers of any of our Restricted
     Subsidiaries in the ordinary course of business to provide for the payment
     of reasonable expenses incurred by such persons in the performance of their
     responsibilities to us or such Restricted Subsidiary or in connection with
     any relocation;

          (4) sales of Equity Interests (other than Disqualified Stock) to
     Affiliates of ours;

          (5) fees and compensation paid to and indemnity provided on behalf of
     our directors, officers or employees or any of our Restricted Subsidiaries
     in the ordinary course of business;

          (6) any employment agreement that is in effect on the date of the
     indenture and any such employment agreement entered into by us or any of
     our Restricted Subsidiaries after the date of the indenture in the ordinary
     course of our business or the business of such Restricted Subsidiary;

          (7) any Restricted Payment that is not prohibited by the covenant set
     forth under the covenant entitled "Restricted Payments;"

          (8) any sale, conveyance or other transfer of accounts receivable and
     other related assets customarily transferred in a Securitization
     Transaction;

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          (9) payment of premiums to and the receipt of proceeds of insurance
     from, Laurier Indemnity Company and Laurier Indemnity Company, Ltd.;

          (10) payments to or receipts from Extendicare Holdings, Inc. pursuant
     to any tax sharing agreement entered into for the purpose of preparing a
     consolidated tax return of Extendicare Holdings, Inc.;

          (11) payments to or receipts from Virtual Care Provider, Inc. in
     connection with the provision of technology services to third parties
     pursuant to the terms of management, consulting or other similar
     agreements; and

          (12) transactions pursuant to the services agreement between us and
     Virtual Care Provider, Inc. relating to certain services provided by us and
     Virtual Care Provider, Inc. to each other as in effect on the date the
     notes are first issued.

ADDITIONAL SUBSIDIARY GUARANTEES

     If we or any of our Restricted Subsidiaries acquires or creates another
domestic Significant Subsidiary or any other Domestic Subsidiary that guarantees
or incurs any Indebtedness or any other Significant Subsidiary or Restricted
Subsidiary that guarantees or otherwise provides direct credit support for
Indebtedness of ours or any of our Domestic Subsidiaries after the date of the
indenture, then that newly acquired or created Significant Subsidiary, Domestic
Subsidiary or other Restricted Subsidiary will execute and deliver to the
trustee a supplemental indenture providing for a Subsidiary Guarantee and
deliver an opinion of counsel satisfactory to the trustee within 10 business
days of the date on which it was acquired or created; provided, however, that
the foregoing will not apply to Subsidiaries that have properly been designated
as Unrestricted Subsidiaries in accordance with the indenture for so long as
they continue to constitute Unrestricted Subsidiaries.

SALE AND LEASEBACK TRANSACTIONS

     We will not, and will not permit any of our Restricted Subsidiaries to,
enter into any sale and leaseback transaction; provided that we or any
Subsidiary Guarantor may enter into a sale and leaseback transaction if:

          (1) we or that Subsidiary Guarantor could have (a) incurred
     Indebtedness in an amount equal to the Attributable Debt relating to such
     sale and leaseback transaction under the Fixed Charge Coverage Ratio test
     in the first paragraph of the "Incurrence of Indebtedness and Issuance of
     Preferred Stock" covenant and (b) incurred a Lien to secure such
     Indebtedness pursuant to the "Liens" covenant;

          (2) the gross cash proceeds of that sale and leaseback transaction are
     at least equal to the fair market value, as determined in good faith by our
     Board of Directors and set forth in an officers' certificate delivered to
     the trustee, of the property that is the subject of that sale and leaseback
     transaction; and

          (3) the transfer of assets in that sale and leaseback transaction is
     permitted by, and we apply the proceeds of such transaction in compliance
     with, the "Asset Sales" covenant.

BUSINESS ACTIVITIES

     We will not, and will not permit any Restricted Subsidiary to, engage in
any business other than Permitted Businesses, except to such extent as would not
be material to us and our Subsidiaries taken as a whole.

PAYMENTS FOR CONSENT

     We will not, and will not permit any of our Restricted Subsidiaries to,
directly or indirectly, pay or cause to be paid any consideration, whether by
way of interest, fee or otherwise, to or for the benefit of
                                        85


any Holder of notes for or as an inducement to any consent, waiver or amendment
of any of the terms or provisions of the indenture or the notes unless such
consideration is offered to be paid and is paid to all Holders of the notes that
consent, waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or agreement.

REPORTS

     Whether or not required by the SEC, so long as any notes are outstanding,
we will furnish to the Holders of notes, within the time periods specified in
the SEC's rules and regulations:

          (1) all quarterly and annual financial information that would be
     required to be contained in a filing with the SEC on Forms 10-Q and 10-K if
     we were required to file such Forms, including a "Management's Discussion
     and Analysis of Financial Condition and Results of Operations" and, with
     respect to the annual information only, a report on the annual financial
     statements by our certified independent accountants; and

          (2) all current reports that would be required to be filed with the
     SEC on Form 8-K if we were required to file such reports.

     If we have designated any of our Subsidiaries as Unrestricted Subsidiaries,
then the quarterly and annual financial information required by the preceding
paragraph will include a reasonably detailed presentation, either on the face of
the financial statements or in the footnotes thereto, and in Management's
Discussion and Analysis of Financial Condition and Results of Operations, of the
financial condition and results of operations of us and our Restricted
Subsidiaries separate from the financial condition and results of operations of
our Unrestricted Subsidiaries.

     In addition, following the consummation of the exchange offer, whether or
not required by the SEC, we will file a copy of all of the information and
reports referred to in clauses (1) and (2) above with the SEC for public
availability within the time periods specified in the SEC's rules and
regulations (unless the SEC will not accept such a filing) and make such
information available to securities analysts and prospective investors upon
request. In addition, we and the Subsidiary Guarantors have agreed that, for so
long as any notes remain outstanding, we will furnish to the Holders and to
securities analysts and prospective investors, upon their request, the
information required to be delivered pursuant to Rule 144A(d)(4) under the
Securities Act.

EVENTS OF DEFAULT AND REMEDIES

     Each of the following is an "Event of Default":

          (1) default for 30 days in the payment when due of interest on the
     notes;

          (2) default in payment when due of the principal of or premium, if
     any, on the notes;

          (3) failure by us or any of our Restricted Subsidiaries to comply with
     the "Restricted Payments," "Incurrence of Indebtedness and Issuance of
     Preferred Stock" or "Merger, Consolidation or Sale of Assets" covenants;

          (4) failure by us or any of our Restricted Subsidiaries for 30 days
     after notice to comply with the provisions described under the headings
     "Repurchase at the Option of Holders -- Asset Sales" and "Repurchase at the
     Option of Holders -- Change of Control;"

          (5) failure by us or any of our Restricted Subsidiaries for 60 days
     after notice to comply with any other covenant or agreement in the
     indenture or the notes;

          (6) default under any mortgage, indenture or instrument under which
     there may be issued or by which there may be secured or evidenced any
     Indebtedness for money borrowed by us or any of our Restricted Subsidiaries
     (or the payment of which is guaranteed by us or any of our Restricted

                                        86


     Subsidiaries) whether such Indebtedness or guarantee now exists, or is
     created after the date of the indenture, if that default:

             (a) is caused by a failure to pay principal of, or interest or
        premium, if any, on such Indebtedness prior to the expiration of the
        grace period provided in such Indebtedness on the date of such default
        (a "Payment Default"); or

             (b) results in the acceleration of such Indebtedness prior to its
        express maturity,

             and, in each case, the principal amount of any such Indebtedness,
        together with the principal amount of any other such Indebtedness under
        which there has been a Payment Default or the maturity of which has been
        so accelerated, aggregates $20.0 million or more;

          (7) failure by us or any of our Restricted Subsidiaries to pay final
     judgments (to the extent not fully covered by insurance) aggregating in
     excess of $20.0 million, which judgments are not paid, discharged or stayed
     for a period of 60 consecutive days;

          (8) except as permitted by the indenture, any Subsidiary Guarantee is
     held in any judicial proceeding to be unenforceable or invalid or ceases
     for any reason to be in full force and effect or any Subsidiary Guarantor,
     or any Person acting on behalf of any Subsidiary Guarantor, denies or
     disaffirms its obligations under its Subsidiary Guarantee; and

          (9) certain events of bankruptcy or insolvency described in the
     indenture with respect to us or any of our Significant Subsidiaries.

     In the case of an Event of Default arising from certain events of
bankruptcy or insolvency, with respect to us, any Subsidiary that is a
Significant Subsidiary or any group of Subsidiaries that, taken together, would
constitute a Significant Subsidiary, all outstanding notes will become due and
payable immediately without further action or notice. If any other Event of
Default occurs and is continuing, the trustee or the Holders of at least 25% in
principal amount of the then outstanding notes may declare all the notes to be
due and payable immediately.

     Holders of the notes may not enforce the indenture or the notes except as
provided in the indenture. Subject to certain limitations, Holders of a majority
in principal amount of the then outstanding notes may direct the trustee in its
exercise of any trust or power. The trustee may withhold from Holders of the
notes notice of any continuing Default or Event of Default if it determines that
withholding notes is in their interest, except a Default or Event of Default
relating to the payment of principal or interest or Liquidated Damages.

     The Holders of a majority in aggregate principal amount of the notes then
outstanding by notice to the trustee may on behalf of the Holders of all of the
notes waive any existing Default or Event of Default and its consequences under
the indenture except a continuing Default or Event of Default in the payment of
interest or Liquidated Damages on, or the principal of, the notes.

     In the case of any Event of Default occurring by reason of any willful
action or inaction taken or not taken by us or on our behalf with the intention
of avoiding payment of the premium that we would have had to pay if we then had
elected to redeem the notes pursuant to the optional redemption provisions of
the indenture, an equivalent premium will also become and be immediately due and
payable to the extent permitted by law upon the acceleration of the notes. If an
Event of Default occurs prior to July 1, 2006, by reason of any willful action
(or inaction) taken (or not taken) by us or on our behalf with the intention of
avoiding the prohibition on redemption of the notes prior to July 1, 2006, then
the premium specified in the indenture will also become immediately due and
payable to the extent permitted by law upon the acceleration of the notes.

     We are required to deliver to the trustee annually a statement regarding
compliance with the indenture. Upon becoming aware of any Default or Event of
Default, we are required to deliver to the trustee a statement specifying such
Default or Event of Default.

                                        87


NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND STOCKHOLDERS

     No director, officer, employee, incorporator or stockholder of ours or of
any Subsidiary Guarantor, as such, will have any liability for any obligations
of ours or of the Subsidiary Guarantors under the notes, the indenture, the
Subsidiary Guarantees, or for any claim based on, in respect of, or by reason
of, such obligations or their creation. Each Holder of notes by accepting a note
waives and releases all such liability. The waiver and release are part of the
consideration for issuance of the notes. The waiver may not be effective to
waive liabilities under the federal securities laws.

LEGAL DEFEASANCE AND COVENANT DEFEASANCE

     We may, at our option and at any time, elect to have all of our obligations
discharged with respect to the outstanding notes and all obligations of the
Subsidiary Guarantors discharged with respect to their Subsidiary Guarantees
("Legal Defeasance") except for:

          (1) the rights of Holders of outstanding notes to receive payments in
     respect of the principal of, or interest or premium and Liquidated Damages,
     if any, on such notes when such payments are due from the trust referred to
     below;

          (2) our obligations with respect to the notes concerning issuing
     temporary notes, registration of notes, mutilated, destroyed, lost or
     stolen notes and the maintenance of an office or agency for payment and
     money for security payments held in trust;

          (3) the rights, powers, trusts, duties and immunities of the trustee,
     and our and the Subsidiary Guarantors' obligations in connection therewith;
     and

          (4) the Legal Defeasance provisions of the indenture.

     In addition, we may, at our option and at any time, elect to have our
obligations and the obligations of the Subsidiary Guarantors released with
respect to certain covenants that are described in the indenture ("Covenant
Defeasance") and thereafter any omission to comply with those covenants will not
constitute a Default or Event of Default with respect to the notes. In the event
Covenant Defeasance occurs, certain events (not including non-payment,
bankruptcy, receivership, rehabilitation and insolvency events) described under
"-- Events of Default and Remedies" will no longer constitute an Event of
Default with respect to the notes.

     In order to exercise either Legal Defeasance or Covenant Defeasance:

          (1) we must irrevocably deposit with the trustee, in trust, for the
     benefit of the Holders of the notes, cash in U.S. dollars, non-callable
     Government Securities, or a combination of cash in U.S. dollars and
     non-callable Government Securities, in amounts as will be sufficient, in
     the opinion of a nationally recognized firm of independent public
     accountants, to pay the principal of, or interest and premium and
     Liquidated Damages, if any, on the outstanding notes on the Stated Maturity
     or on the applicable redemption date, as the case may be, and we must
     specify whether the notes are being defeased to maturity or to a particular
     redemption date;

          (2) in the case of Legal Defeasance, we must deliver to the trustee an
     opinion of counsel reasonably acceptable to the trustee confirming that (a)
     we have received from, or there has been published by, the Internal Revenue
     Service a ruling or (b) since the date of the indenture, there has been a
     change in the applicable federal income tax law, in either case to the
     effect that, and based thereon such opinion of counsel will confirm that,
     the Holders of the outstanding notes will not recognize income, gain or
     loss for federal income tax purposes as a result of such Legal Defeasance
     and will be subject to federal income tax on the same amounts, in the same
     manner and at the same times as would have been the case if such Legal
     Defeasance had not occurred;

          (3) in the case of Covenant Defeasance, we must deliver to the trustee
     an opinion of counsel reasonably acceptable to the trustee confirming that
     the Holders of the outstanding notes will not recognize income, gain or
     loss for federal income tax purposes as a result of such Covenant

                                        88


     Defeasance and will be subject to federal income tax on the same amounts,
     in the same manner and at the same times as would have been the case if
     such Covenant Defeasance had not occurred;

          (4) no Default or Event of Default has occurred and is continuing on
     the date of such deposit (other than a Default or Event of Default
     resulting from the borrowing of funds to be applied to such deposit);

          (5) such Legal Defeasance or Covenant Defeasance will not result in a
     breach or violation of, or constitute a default under, any material
     agreement or instrument (excluding the indenture) to which we or any of our
     Subsidiaries is a party or by which we or any of our Subsidiaries is bound;

          (6) we must deliver to the trustee an officers' certificate stating
     that the deposit was not made by us with the intent of preferring the
     Holders of notes over our other creditors with the intent of defeating,
     hindering, delaying or defrauding our creditors or others; and

          (7) we must deliver to the trustee an officers' certificate and an
     opinion of counsel, each stating that all conditions precedent relating to
     the Legal Defeasance or the Covenant Defeasance have been complied with.

AMENDMENT, SUPPLEMENT AND WAIVER

     Except as provided in the next two succeeding paragraphs, the indenture or
the notes may be amended or supplemented with the consent of the Holders of at
least a majority in principal amount of the notes, including Additional Notes,
if any, then outstanding voting as a single class (including, without
limitation, consents obtained in connection with a purchase of, or tender offer
or exchange offer for notes), and any existing Default or Event of Default
except a continuing Default or Event of Default in the payment of interest or
Liquidated Damages on, or the principal of, the notes or compliance with any
provision of the indenture or the notes may be waived with the consent of the
Holders of a majority in principal amount of the notes, including Additional
Notes, if any, then outstanding voting as a single class (including, without
limitation, consents obtained in connection with a purchase of, or tender offer
or exchange offer for notes).

     Without the consent of each Holder affected, an amendment or waiver may not
(with respect to any notes held by a non-consenting Holder):

          (1) reduce the principal amount of notes whose Holders must consent to
     an amendment, supplement or waiver;

          (2) reduce the principal of or change the fixed maturity of any note
     or alter the provisions with respect to the redemption of the notes;

          (3) make any change in the provisions of the indenture described above
     under the heading "--Repurchase at the Option of Holders;"

          (4) reduce the rate of or change the time for payment of interest on
     any note;

          (5) waive a Default or Event of Default in the payment of principal
     of, or interest or premium, if any, on the notes (except a rescission of
     acceleration of the notes by the Holders of at least a majority in
     aggregate principal amount of the notes and a waiver of the payment default
     that resulted from such acceleration);

          (6) make any note payable in money other than that stated in the
     notes;

          (7) make any change in the provisions of the indenture relating to
     waivers of past Defaults or the rights of Holders of notes to receive
     payments of principal of, or interest or premium or Liquidated Damages, if
     any, on the notes;

          (8) waive a redemption payment with respect to any note;

          (9) release any Subsidiary Guarantor from any of its obligations under
     its Subsidiary Guarantee or the indenture, except in accordance with the
     terms of the indenture; or

                                        89


          (10) make any change in the preceding amendment and waiver provisions.

     Notwithstanding the preceding, without the consent of any Holder of notes,
we, the Subsidiary Guarantors and the trustee may amend or supplement the
indenture or the notes:

          (1) to cure any ambiguity, defect or inconsistency;

          (2) to provide for uncertificated notes in addition to or in place of
     certificated notes;

          (3) to provide for the assumption by a successor corporation of our
     obligations under the indenture in the case of a merger or consolidation or
     sale of all or substantially all of our assets;

          (4) to make any change that would provide any additional rights or
     benefits to the Holders of notes or that does not adversely affect the
     legal rights under the indenture of any such Holder; or

          (5) to make any change to comply with any requirement of the SEC in
     order to effect or maintain the qualification of the indenture under the
     Trust Indenture Act.

SATISFACTION AND DISCHARGE

     The indenture will be discharged and will cease to be of further effect as
to all notes issued thereunder, when:

          (1) either:

             (a) all notes that have been authenticated, except lost, stolen or
        destroyed notes that have been replaced or paid and notes for whose
        payment money has been deposited in trust and thereafter repaid to us,
        have been delivered to the trustee for cancellation; or

             (b) all notes that have not been delivered to the trustee for
        cancellation have become due and payable by reason of the mailing of a
        notice of redemption or otherwise or will become due and payable within
        one year, and we have irrevocably deposited or caused to be deposited
        with the trustee as trust funds in trust solely for the benefit of the
        Holders, cash in U.S. dollars, non-callable Government Securities, or a
        combination of cash in U.S. dollars and non-callable Government
        Securities, in such amounts as will be sufficient without consideration
        of any reinvestment of interest, to pay and discharge the entire
        indebtedness on the notes not delivered to the trustee for cancellation
        for principal, premium and Liquidated Damages, if any, and accrued
        interest to the date of maturity or redemption;

          (2) no Default or Event of Default has occurred and is continuing on
     the date of the deposit or will occur as a result of the deposit and the
     deposit will not result in a breach or violation of, or constitute a
     default under, any other instrument to which we or any Subsidiary Guarantor
     is a party or by which we or any Subsidiary Guarantor is bound;

          (3) we have paid or caused to be paid all sums payable by us under the
     indenture; and

          (4) we have delivered irrevocable instructions to the trustee under
     the indenture to apply the deposited money and/or proceeds from
     non-callable Government Securities toward the payment of the notes at
     maturity or the redemption date, as the case may be.

     In addition, we must deliver an officers' certificate and an opinion of
counsel to the trustee stating that all conditions precedent to satisfaction and
discharge have been satisfied.

CONCERNING THE TRUSTEE

     If the trustee becomes a creditor of ours or of any Subsidiary Guarantor,
the indenture limits its right to obtain payment of claims in certain cases, or
to realize on certain property received in respect of any such claim as security
or otherwise. The trustee will be permitted to engage in other transactions;
however, if it acquires any conflicting interest, it must (i) eliminate such
conflict within 90 days, (ii) apply to the SEC for permission to continue or
(iii) resign.

                                        90


     The Holders of a majority in principal amount of the then outstanding notes
will have the right to direct the time, method and place of conducting any
proceeding for exercising any remedy available to the trustee, subject to
certain exceptions. The indenture provides that in case an Event of Default
occurs and is continuing, the trustee will be required, in the exercise of its
power, to use the degree of care of a prudent man in the conduct of his own
affairs. Subject to such provisions, the trustee will be under no obligation to
exercise any of its rights or powers under the indenture at the request of any
Holder of notes, unless such Holder has offered to the trustee security and
indemnity satisfactory to it against any loss, liability or expense.

ADDITIONAL INFORMATION

     Anyone who receives this prospectus may obtain a copy of the indenture
without charge by writing to us at the address set forth in the "Summary"
section of this prospectus.

BOOK-ENTRY, DELIVERY AND FORM

     The new notes will be issued in fully registered book entry form, and will
be represented by one or more global notes in minimum denominations of $1,000
and integral multiples of $1,000 in excess of $1,000. All Holders of new notes
who exchanged their old notes in the exchange offer will hold their interests
through the global notes regardless of whether they purchased their interests
pursuant to Rule 144A under the Securities Act or Regulation S.

     The global notes will be deposited upon issuance with the trustee as
custodian for The Depository Trust Company ("DTC"), in New York, New York, and
registered in the name of Cede & Co., as nominee of DTC (such nominee being
referred to herein as the "Global Note Holder"), in each case for credit to an
account of a direct or indirect participant in DTC as described below.

     Except as set forth below, the global notes may be transferred, in whole
and not in part, only to another nominee of DTC or to a successor of DTC or its
nominee. Beneficial interests in the global notes may not be exchanged for notes
in certificated form except in the limited circumstances described below. See
"-- Exchange of Global Notes for Certificated Notes." Except in the limited
circumstances described below, owners of beneficial interests in the global
notes will not be entitled to receive physical delivery of notes in certificated
form.

     Transfers of beneficial interests in the global notes will be subject to
the applicable rules and procedures of DTC and its direct or indirect
participants (including, if applicable, those of the Euroclear System
("Euroclear") and Clearstream Banking S.A. ("Clearstream") through which Holders
of the old notes issued pursuant to Regulation S initially held such notes),
which may change from time to time.

DEPOSITORY PROCEDURES

     The following description of the operations and procedures of DTC,
Euroclear and Clearstream are provided solely as a matter of convenience. These
operations and procedures are solely within the control of the respective
settlement systems and are subject to changes by them. We take no responsibility
for these operations and procedures and urge investors to contact the system or
their participants directly to discuss these matters.

     DTC has advised us that DTC is a limited-purpose trust company created to
hold securities for its participating organizations (collectively, the
"Participants") and to facilitate the clearance and settlement of transactions
in those securities between Participants through electronic book-entry changes
in accounts of its Participants. The Participants include securities brokers and
dealers (including the initial purchasers), banks, trust companies, clearing
corporations and certain other organizations. Access to DTC's system is also
available to other entities such as banks, brokers, dealers and trust companies
that clear through or maintain a custodial relationship with a Participant,
either directly or indirectly (collectively, the "Indirect Participants").
Persons who are not Participants may beneficially own securities held by or on
behalf of DTC only through the Participants or the Indirect Participants. The
ownership

                                        91


interests in, and transfers of ownership interests in, each security held by or
on behalf of DTC are recorded on the records of the Participants and Indirect
Participants.

     DTC has also advised us that, pursuant to procedures established by it:

          (1) upon deposit of the global notes, DTC will credit the accounts of
     Participants with portions of the principal amount of the global notes; and

          (2) ownership of these interests in the global notes will be shown on,
     and the transfer of ownership of these interests will be effected only
     through, records maintained by DTC (with respect to the Participants) or by
     the Participants and the Indirect Participants (with respect to other
     owners of beneficial interest in the global notes).

     Investors in the global notes who are Participants in DTC's system may hold
their interests therein directly through DTC. Investors in the global notes who
are not Participants may hold their interests therein indirectly through
organizations (including Euroclear and Clearstream) which are Participants in
such system. All interests in a global note, including those held through
Euroclear or Clearstream, may be subject to the procedures and requirements of
DTC. Those interests held through Euroclear or Clearstream may also be subject
to the procedures and requirements of such systems. The laws of some states
require that certain Persons take physical delivery in definitive form of
securities that they own. Consequently, the ability to transfer beneficial
interests in a global note to such Persons will be limited to that extent.
Because DTC can act only on behalf of Participants, which in turn act on behalf
of Indirect Participants, the ability of a Person having beneficial interests in
a global note to pledge such interests to Persons that do not participate in the
DTC system, or otherwise take actions in respect of such interests, may be
affected by the lack of a physical certificate evidencing such interests.

     Except as described below, owners of interest in the global notes will not
have notes registered in their names, will not receive physical delivery of
notes in certificated form and will not be considered the registered owners or
"Holders" thereof under the indenture for any purpose.

     Payments in respect of the principal of, and interest and premium and
Liquidated Damages, if any, on a global note registered in the name of DTC or
its nominee will be payable to DTC in its capacity as the registered Holder
under the indenture. Under the terms of the indenture, we and the trustee will
treat the Persons in whose names the notes, including the global notes, are
registered as the owners of the notes for the purpose of receiving payments and
for all other purposes. Consequently, neither we, the trustee nor any agent of
ours or the trustee has or will have any responsibility or liability for:

          (1) any aspect of DTC's records or any Participant's or Indirect
     Participant's records relating to or payments made on account of beneficial
     ownership interest in the global notes or for maintaining, supervising or
     reviewing any of DTC's records or any Participant's or Indirect
     Participant's records relating to the beneficial ownership interests in the
     global notes; or

          (2) any other matter relating to the actions and practices of DTC or
     any of its Participants or Indirect Participants.

     DTC has advised us that its current practice, upon receipt of any payment
in respect of securities such as the notes (including principal and interest),
is to credit the accounts of the relevant Participants with the payment on the
payment date unless DTC has reason to believe it will not receive payment on
such payment date. Each relevant Participant is credited with an amount
proportionate to its beneficial ownership of an interest in the principal amount
of the relevant security as shown on the records of DTC. Payments by the
Participants and the Indirect Participants to the beneficial owners of notes
will be governed by standing instructions and customary practices and will be
the responsibility of the Participants or the Indirect Participants and will not
be the responsibility of DTC, the trustee or us. Neither we nor the trustee will
be liable for any delay by DTC or any of its Participants in identifying the
beneficial owners of the notes, and we and the trustee may conclusively rely on
and will be protected in relying on instructions from DTC or its nominee for all
purposes.

                                        92


     Transfers between Participants in DTC will be effected in accordance with
DTC's procedures, and will be settled in same-day funds, and transfers between
participants in Euroclear and Clearstream will be effected in accordance with
their respective rules and operating procedures.

     Cross-market transfers between the Participants in DTC, on the one hand,
and Euroclear or Clearstream participants, on the other hand, will be effected
through DTC in accordance with DTC's rules on behalf of Euroclear or
Clearstream, as the case may be, by its respective depositary; however, such
cross-market transactions will require delivery of instructions to Euroclear or
Clearstream, as the case may be, by the counterparty in such system in
accordance with the rules and procedures and within the established deadlines
(Brussels time) of such system. Euroclear or Clearstream, as the case may be,
will, if the transaction meets its settlement requirements, deliver instructions
to its respective depositary to take action to effect final settlement on its
behalf by delivering or receiving interests in the relevant global note in DTC,
and making or receiving payment in accordance with normal procedures for
same-day funds settlement applicable to DTC. Euroclear participants and
Clearstream participants may not deliver instructions directly to the
depositories for Euroclear or Clearstream.

     DTC has advised us that it will take any action permitted to be taken by a
Holder of notes only at the direction of one or more Participants to whose
account DTC has credited the interests in the global notes and only in respect
of such portion of the aggregate principal amount of the global notes as to
which such Participant or Participants has or have given such direction.
However, if there is an Event of Default under the notes, DTC reserves the right
to exchange the global notes for notes in certificated form, and to distribute
such notes to its Participants.

     Although DTC, Euroclear and Clearstream have agreed to the foregoing to
facilitate transfers of interests in the global notes among participants in DTC,
Euroclear and Clearstream, they are under no obligation to perform or to
continue to perform such procedures, and may discontinue such procedures at any
time. Neither we nor the trustee nor any of their respective agents will have
any responsibility for the performance by DTC, Euroclear or Clearstream or their
respective participants or indirect participants of their respective obligations
under the rules and procedures governing their operations.

EXCHANGE OF GLOBAL NOTES FOR CERTIFICATED NOTES

     A global note is exchangeable for definitive notes in registered
certificated form ("Certificated Notes") if:

          (1) DTC (a) notifies us that it is unwilling or unable to continue as
     depositary for the global notes and we fail to appoint a successor
     depositary or (b) has ceased to be a clearing agency registered under the
     Exchange Act;

          (2) we, at our option, notify the trustee in writing that we elect to
     cause the issuance of the Certificated Notes; or

          (3) there has occurred and is continuing a Default or Event of Default
     with respect to the notes.

     In addition, beneficial interests in a global note may be exchanged for
Certificated Notes upon prior written notice given to the trustee by or on
behalf of DTC in accordance with the indenture. In all cases, Certificated Notes
delivered in exchange for any global note or beneficial interests in global
notes will be registered in the names, and issued in any approved denominations,
requested by or on behalf of the depositary (in accordance with its customary
procedures).

EXCHANGE OF CERTIFICATED NOTES FOR GLOBAL NOTES

     Certificated Notes may be exchanged for beneficial interests in any global
note at any time.

SAME DAY SETTLEMENT AND PAYMENT

     We will make payments in respect of the notes represented by the global
notes (including principal, premium, if any, interest and Liquidated Damages, if
any) by wire transfer of immediately available funds
                                        93


to the accounts specified by the Global Note Holder. We will make all payments
of principal, interest and premium and Liquidated Damages, if any, with respect
to Certificated Notes by wire transfer of immediately available funds to the
accounts specified by the Holders of Certificated Notes or, if no such account
is specified, by mailing a check to each such Holder's registered address. The
notes represented by the global notes are expected to be eligible to trade in
the PORTAL Market(SM) and to trade in DTC's Same-Day Funds Settlement System,
and any permitted secondary market trading activity in such notes will,
therefore, be required by DTC to be settled in immediately available funds. We
expect that secondary trading in any Certificated Notes will also be settled in
immediately available funds.

CERTAIN DEFINITIONS

     Set forth below are certain defined terms used in the indenture. Reference
is made to the indenture for a full disclosure of all such terms, as well as any
other capitalized terms used herein for which no definition is provided.

     "Acquired Debt" means, with respect to any specified Person:

          (1) Indebtedness of any other Person existing at the time such other
     Person is merged with or into or became a Subsidiary of such specified
     Person, whether or not such Indebtedness is incurred in connection with, or
     in contemplation of, such other Person merging with or into, or becoming a
     Subsidiary of, such specified Person; and

          (2) Indebtedness secured by a Lien encumbering any asset acquired by
     such specified Person.

     "Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control,"
as used with respect to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; provided that beneficial ownership of 10% or more of the
Voting Stock of a Person will be deemed to be control. For purposes of this
definition, the terms "controlling," "controlled by" and "under common control
with" have correlative meanings.

     "Asset Sale" means the sale, lease, conveyance or other disposition of any
assets or rights (including, without limitation, (x) a sale and leaseback, (y)
the issuance, sale or other transfer of any Equity Interests in any of our
Unrestricted Subsidiaries, and (z) the receipt of proceeds of insurance paid on
account of the loss of or damage to any asset and awards of compensation for any
asset taken by condemnation, eminent domain or similar proceeding, and including
the receipt of proceeds of business interruption insurance) in each case, in one
or a series of related transactions that have a fair market value in excess of
$1.0 million or for Net Proceeds in excess of $1.0 million; provided that the
sale, conveyance or other disposition of all or substantially all of the assets
of us and our Restricted Subsidiaries taken as a whole will be governed by the
provisions of the indenture described above under "-- Repurchase at the Option
of Holders -- Change of Control" and/or the provisions described above under
"-- Merger, Consolidation or Sale of Assets" and not by the provisions of the
"-- Asset Sales" covenant.

     Notwithstanding the preceding, the following items will not be deemed to be
Asset Sales:

          (1) the sale, lease or other disposition of equipment, inventory,
     accounts receivable or other assets or rights in the ordinary course of
     business;

          (2) a transfer of assets or rights by us to a Subsidiary Guarantor or
     by a Subsidiary Guarantor of ours to us or to another Subsidiary Guarantor
     of ours;

          (3) an issuance of Equity Interests by a Subsidiary Guarantor to us or
     to another Subsidiary Guarantor of ours;

          (4) a Restricted Payment or Permitted Investment that is permitted by
     the "Restricted Payments" covenant;

          (5) the sale of property or equipment that has become worn out,
     obsolete or damaged;
                                        94


          (6) the sale or other disposition of Cash Equivalents;

          (7) the sale of accounts receivable pursuant to a Securitization
     Transaction; or

          (8) the designation of any Restricted Subsidiary as an Unrestricted
     Subsidiary or the contribution to the capital of any Unrestricted
     Subsidiary in accordance with the provisions described under "Designation
     of Restricted and Unrestricted Subsidiaries."

     "Attributable Debt" in respect of a sale and leaseback transaction means,
at the time of determination, the greater of (a) the fair value of the property
subject to such arrangement (as determined in good faith by our Board of
Directors) or (b) the present value (discounted at the interest rate borne by
the notes, compounded annually) of the total obligations of the lessee for
rental payments during the remaining term of the lease included in such sale and
leaseback transaction, including any period for which such lease has been
extended or may, at the option of the lessor, be extended.

     "Board of Directors" means:

          (1) with respect to a corporation, the board of directors of the
     corporation;

          (2) with respect to a partnership, the board of directors of the
     general partner of the partnership; and

          (3) with respect to any other Person, the board or committee of such
     Person serving a similar function.

     "Capital Lease Obligation" means, at the time any determination is to be
made, the amount of the liability in respect of a capital lease that would at
that time be required to be capitalized on a balance sheet in accordance with
GAAP.

     "Capital Stock" means:

          (1) in the case of a corporation, any and all shares, including common
     stock and preferred stock;

          (2) in the case of an association or business entity, any and all
     shares, interests, participations, rights or other equivalents (however
     designated) of corporate stock;

          (3) in the case of a partnership or limited liability company,
     partnership or membership interests (whether general or limited); and

          (4) any other interest or participation that confers on a Person the
     right to receive a share of the profits and losses of, or distributions of
     assets of, the issuing Person.

     "Cash Equivalents" means:

          (1) United States dollars;

          (2) securities issued or directly and fully guaranteed or insured by
     the United States government or any agency or instrumentality of the United
     States government (provided that the full faith and credit of the United
     States is pledged in support of those securities) having maturities of not
     more than six months from the date of acquisition;

          (3) certificates of deposit and eurodollar time deposits with
     maturities of six months or less from the date of acquisition, bankers'
     acceptances with maturities not exceeding six months and overnight bank
     deposits, in each case, with any lender party to the Credit Agreement or
     with any domestic commercial bank having capital and surplus in excess of
     $500.0 million and a Thomson Bank Watch Rating of "B" or better;

          (4) repurchase obligations with a term of not more than seven days for
     underlying securities of the types described in clauses (2) and (3) above
     entered into with any financial institution meeting the qualifications
     specified in clause (3) above;

                                        95


          (5) commercial paper having the highest rating obtainable from Moody's
     Investors Service, Inc. or Standard & Poor's Rating Services and in each
     case maturing within six months after the date of acquisition; and

          (6) money market funds at least 95% of the assets of which constitute
     Cash Equivalents of the kinds described in clauses (1) through (5) of this
     definition.

     "Change of Control" means the occurrence of any of the following:

          (1) any sale, lease, exchange or other transfer (in one transaction or
     a series of related transactions) of all or substantially all of our assets
     to any Person or group of related Persons for purposes of Section 13(d) of
     the Exchange Act (a "Group"), together with any Affiliates thereof (whether
     or not otherwise in compliance with the provisions of the indenture);

          (2) the approval by the holders of our Capital Stock of any plan or
     proposal for the liquidation or dissolution of us (whether or not otherwise
     in compliance with the provisions of the indenture);

          (3) any Person or Group (other than Parent or any direct or indirect
     wholly owned Subsidiary of Parent) becomes the owner, directly or
     indirectly, beneficially or of record, of shares representing more than 35%
     of the aggregate ordinary voting power represented by our issued and
     outstanding Capital Stock on a fully-diluted basis;

          (4) the replacement of a majority of Parent's or our Board of
     Directors over a two-year period from the directors who constituted
     Parent's or our Board of Directors, as applicable, at the beginning of such
     period, and such replacement shall not have been approved by a vote of at
     least a majority of Parent's or our Board of Directors, as applicable, then
     still in office who either were members of such Board of Directors at the
     beginning of such period or whose election as a member of such Board of
     Directors was previously so approved; or

          (5) we consolidate with, or merge with or into, any Person, or any
     Person consolidates with, or merges with or into, us, in any such event
     pursuant to a transaction in which any of our outstanding Voting Stock or
     the outstanding Voting Stock of such other Person is converted into or
     exchanged for cash, securities or other property, other than any such
     transaction where our Voting Stock outstanding immediately prior to such
     transaction is converted into or exchanged for Voting Stock (other than
     Disqualified Stock) of the surviving or transferee Person constituting a
     majority of the outstanding shares of such Voting Stock of such surviving
     or transferee Person (immediately after giving effect to such issuance).

     "Consolidated Cash Flow" means, with respect to any specified Person for
any period, the Consolidated Net Income of such Person for such period plus:

          (1) an amount equal to any extraordinary loss plus any net loss
     realized by such Person or any of its Subsidiaries in connection with an
     Asset Sale, to the extent such losses were deducted in computing such
     Consolidated Net Income; plus

          (2) provision for taxes based on income or profits of such Person and
     its Restricted Subsidiaries for such period, to the extent that such
     provision for taxes was deducted in computing such Consolidated Net Income;
     plus

          (3) consolidated interest expense of such Person and its Restricted
     Subsidiaries for such period, whether paid or accrued and whether or not
     capitalized (including, without limitation, amortization of debt issuance
     costs and original issue discount, non-cash interest payments, the interest
     component of any deferred payment obligations, the interest component of
     all payments associated with Capital Lease Obligations, imputed interest
     with respect to Attributable Debt, commissions, discounts and other fees
     and charges incurred in respect of letter of credit or bankers' acceptance
     financings, and net of the effect of all payments made or received pursuant
     to Hedging Obligations), to the extent that any such expense was deducted
     in computing such Consolidated Net Income; plus

                                        96


          (4) depreciation, amortization (including amortization of goodwill and
     other intangibles but excluding amortization of prepaid cash expenses that
     were paid in a prior period) and other non-cash expenses (excluding any
     such non-cash expense to the extent that it represents an accrual of or
     reserve for cash expenses in any future period) of such Person and its
     Restricted Subsidiaries for such period to the extent that such
     depreciation, amortization and other non-cash expenses were deducted in
     computing such Consolidated Net Income; minus

          (5) non-cash items increasing such Consolidated Net Income for such
     period, other than the accrual of revenue in the ordinary course of
     business,

in each case, on a consolidated basis and determined in accordance with GAAP.

     "Consolidated Net Income" means, with respect to any specified Person for
any period, the aggregate of the Net Income of such Person and its Restricted
Subsidiaries for such period, on a consolidated basis, determined in accordance
with GAAP; provided that:

          (1) the Net Income (but not loss) of any Person that is not a
     Restricted Subsidiary or that is accounted for by the equity method of
     accounting will be included only to the extent of the amount of dividends
     or distributions paid in cash to the specified Person or a Restricted
     Subsidiary of the Person;

          (2) the Net Income of any Restricted Subsidiary will be excluded to
     the extent that the declaration or payment of dividends or similar
     distributions by that Restricted Subsidiary of that Net Income is not at
     the date of determination permitted without any prior governmental approval
     (that has not been obtained) or, directly or indirectly, by operation of
     the terms of its charter or any agreement, instrument, judgment, decree,
     order, statute, rule or governmental regulation applicable to that
     Restricted Subsidiary or its stockholders; and

          (3) the cumulative effect of a change in accounting principles will be
     excluded.

     "Consolidated Senior Debt Leverage Ratio" means the ratio of (1)
consolidated Indebtedness of us and our Restricted Subsidiaries (other than
Subordinated Indebtedness) as of the date of the transaction giving rise to the
need to calculate such Consolidated Senior Debt Leverage Ratio to (2)
Consolidated Cash Flow for the four full fiscal quarters immediately preceding
the date of the transaction giving rise to the need to calculate such
Consolidated Senior Debt Leverage Ratio taken as one period.

     "Consolidated Tangible Assets" means the total assets, less goodwill and
other intangibles, shown on our most recent consolidated balance sheet,
determined on a consolidated basis in accordance with GAAP less all write-ups
(other than write-ups in connection with acquisitions) subsequent to the date of
the indenture in the book value of any asset (except any such intangible assets)
owned by us or any of our Restricted Subsidiaries.

     "Credit Agreement" means that certain Credit Agreement, dated as of the
date of the indenture, by and among us, the Subsidiary Guarantors, Lehman
Commercial Paper Inc., as administrative agent, and the lenders party thereto,
including any related notes, guarantees, security and collateral documents,
instruments and agreements executed in connection therewith.

     "Credit Facilities" means one or more debt facilities or agreements
(including, without limitation, the Credit Agreement) or commercial paper
facilities, in each case with banks or other lenders providing for revolving
credit loans, term loans, notes, receivables financing (including through the
sale of receivables to such lenders or to special purpose entities formed to
borrow from such lenders against such receivables) or letters of credit, in each
case, as amended, restated, modified, renewed, refunded, replaced, restructured,
restated or refinanced (including any agreement to extend the maturity thereof
and adding additional borrowers or guarantors) in whole or in part from time to
time under the same or any other agent, lender or group of lenders and including
increasing the amount of available borrowings thereunder; provided that such
increase is permitted by the "Incurrence of Indebtedness and Issuance of
Preferred Stock" covenant above.

                                        97


     "Default" means any event that is, or with the passage of time or the
giving of notice or both would be, an Event of Default.

     "Designated Non-Cash Consideration" means the fair market value of total
consideration received by us or any of our Restricted Subsidiaries in connection
with an Asset Sale that is so designated as Designated Non-Cash Consideration
pursuant to an officer's certificate, setting forth the basis of such valuation,
executed by our principal executive officer and principal financial officer,
less the amount of cash or Cash Equivalents received in connection with the
Asset Sale; provided, however, the total amount of Designated Non-Cash
Consideration outstanding at one time does not exceed the greater of $15.0
million and 2.5% of Consolidated Tangible Assets.

     "Disqualified Stock" means any Capital Stock that, by its terms (or by the
terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder of the Capital Stock), or
upon the happening of any event, matures or is mandatorily redeemable, pursuant
to a sinking fund obligation or otherwise, or redeemable at the option of the
holder of the Capital Stock, in whole or in part, on or prior to the date that
is 91 days after the date on which the notes mature. Notwithstanding the
preceding sentence, any Capital Stock that would constitute Disqualified Stock
solely because the holders of the Capital Stock have the right to require us to
repurchase such Capital Stock upon the occurrence of a Change of Control or an
Asset Sale will not constitute Disqualified Stock if the terms of such Capital
Stock provide that we may not repurchase or redeem any such Capital Stock
pursuant to such provisions unless such repurchase or redemption complies with
the "-- Restricted Payments" covenant.

     "Domestic Subsidiary" means any Restricted Subsidiary of ours that was
formed under the laws of the United States or any state of the United States or
the District of Columbia.

     "Equity Interests" means Capital Stock and all warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).

     "Existing Indebtedness" means Indebtedness of us and our Subsidiaries
(other than Indebtedness under the Credit Agreement) in existence on the date of
the indenture, until such amounts are repaid.

     "Fixed Charges" means, with respect to any specified Person for any period,
the sum, without duplication, of:

          (1)  the consolidated interest expense of such Person and its
     Restricted Subsidiaries for such period, whether paid or accrued,
     including, without limitation, amortization of debt issuance costs and
     original issue discount, non-cash interest payments, the interest component
     of any deferred payment obligations, the interest component of all payments
     associated with Capital Lease Obligations, imputed interest with respect to
     Attributable Debt, commissions, discounts and other fees and charges
     incurred in respect of letter of credit or bankers' acceptance financings,
     and net of the effect of all payments made or received pursuant to Hedging
     Obligations; plus

          (2)  the consolidated interest of such Person and its Restricted
     Subsidiaries that was capitalized during such period; plus

          (3)  any interest expense on Indebtedness of another Person that is
     Guaranteed by such Person or secured by a Lien on assets of such Person,
     whether or not such Guarantee or Lien is called upon; plus

          (4)  the product of (a) all dividends, whether paid or accrued and
     whether or not in cash, on any series of preferred stock of such Person or
     any of its Restricted Subsidiaries other than dividends on Equity Interests
     payable solely in Equity Interests of such Person (other than Disqualified
     Stock) or to such Person or one of its Restricted Subsidiaries, times (b) a
     fraction, the numerator of which is one and the denominator of which is one
     minus the then current combined federal, state and local statutory tax rate
     of such Person, expressed as a decimal, in each case, on a consolidated
     basis and in accordance with GAAP.

                                        98


     "Fixed Charge Coverage Ratio" means, with respect to any specified Person
for any period, the ratio of the Consolidated Cash Flow of such Person and its
Restricted Subsidiaries for such period to the Fixed Charges of such Person and
its Restricted Subsidiaries for such period. In the event that the specified
Person or any of its Restricted Subsidiaries incurs, assumes, Guarantees,
repays, repurchases or redeems any Indebtedness (other than ordinary working
capital borrowings) or issues, repurchases or redeems preferred stock subsequent
to the commencement of the reference period for which the Fixed Charge Coverage
Ratio is being calculated and on or prior to the date on which the event for
which the calculation of the Fixed Charge Coverage Ratio is made (the
"Calculation Date"), then the Fixed Charge Coverage Ratio will be calculated
giving pro forma effect to such incurrence, assumption, Guarantee, repayment,
repurchase or redemption of Indebtedness, or such issuance, repurchase or
redemption of preferred stock, and the use of the proceeds therefrom as if the
same had occurred at the beginning of the applicable four-quarter reference
period; provided, however, that the Fixed Charges of such Person attributable to
interest on any Indebtedness under a revolving credit facility computed on a pro
forma basis will be computed based on the average daily balance of such
Indebtedness during the four-quarter reference period and using the interest
rate in effect at the end of such period.

     In addition, for purposes of calculating the Fixed Charge Coverage Ratio:

          (1)  acquisitions that have been made by the specified Person or any
     of its Restricted Subsidiaries, including through mergers or consolidations
     and including any related financing transactions, during the four-quarter
     reference period or subsequent to such reference period and on or prior to
     the Calculation Date will be given pro forma effect (calculated in
     accordance with Regulation S-X) as if they had occurred on the first day of
     the four-quarter reference period and Consolidated Cash Flow for such
     reference period will be calculated without giving effect to clause (3) of
     the proviso set forth in the definition of Consolidated Net Income;

          (2)  the Consolidated Cash Flow attributable to discontinued
     operations as determined in accordance with GAAP, and operations or
     businesses disposed of prior to the Calculation Date will be excluded; and

          (3)  the Fixed Charges attributable to discontinued operations, as
     determined in accordance with GAAP, and operations or businesses disposed
     of prior to the Calculation Date, will be excluded, but only to the extent
     that the obligations giving rise to such Fixed Charges will not be
     obligations of the specified Person or any of its Restricted Subsidiaries
     following the Calculation Date.

     "GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect on the date of the indenture.

     "Guarantee" means a guarantee other than by endorsement of negotiable
instruments for collection in the ordinary course of business, direct or
indirect, in any manner including, without limitation, by way of a pledge of
assets or through letters of credit or reimbursement agreements in respect
thereof, of all or any part of any Indebtedness.

     "Hedging Obligations" means, with respect to any specified Person, the
obligations of such Person under:

          (1)  interest rate swap agreements, interest rate cap agreements and
     interest rate collar agreements;

          (2)  other agreements or arrangements designed to protect such Person
     against fluctuations in interest rates; and

          (3)  foreign exchange contracts, currency swap agreements or other
     agreements or arrangements designed to protect such Person against
     fluctuations in currency values.

                                        99


     "Holder" means a Person in whose name a note is registered.

     "Indebtedness" means, with respect to any specified Person, any
indebtedness of such Person, whether or not contingent:

          (1)  in respect of borrowed money;

          (2)  evidenced by bonds, notes, debentures or similar instruments or
     letters of credit (or reimbursement agreements in respect thereof);

          (3)  in respect of banker's acceptances;

          (4)  representing Capital Lease Obligations;

          (5)  representing the balance deferred and unpaid of the purchase
     price of any property, except any such balance that constitutes an accrued
     expense or trade payable; or

          (6)  representing any Hedging Obligations;

if and to the extent any of the preceding items (other than letters of credit
and Hedging Obligations) would appear as a liability upon a balance sheet of the
specified Person prepared in accordance with GAAP. In addition, the term
"Indebtedness" includes all Indebtedness of others secured by a Lien on any
asset of the specified Person (whether or not such Indebtedness is assumed by
the specified Person) and, to the extent not otherwise included, the Guarantee
by the specified Person of any Indebtedness of any other Person.

     The amount of any Indebtedness outstanding as of any date will be:

          (1)  the accreted value of the Indebtedness, in the case of any
     Indebtedness issued with original issue discount; and

          (2)  the principal amount of the Indebtedness, together with any
     interest on the Indebtedness that is more than 30 days past due, in the
     case of any other Indebtedness.

     "Investments" means, with respect to any Person, all direct or indirect
investments by such Person in other Persons (including Affiliates) in the forms
of loans (including Guarantees or other obligations), advances or capital
contributions (excluding commission, travel and similar advances to officers and
employees made in the ordinary course of business), purchases or other
acquisitions for consideration of Indebtedness, Equity Interests or other
securities, together with all items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP; provided that
Investments shall not be deemed to include extensions of trade credit by us or
any of our Restricted Subsidiaries on commercially reasonable terms in
accordance with normal trade practices. If we or any of our Subsidiaries sells
or otherwise disposes of any Equity Interests of any direct or indirect
Subsidiary of ours such that, after giving effect to any such sale or
disposition, such Person is no longer a Subsidiary of ours, we will be deemed to
have made an Investment on the date of any such sale or disposition equal to the
fair market value of the Equity Interests of such Subsidiary not sold or
disposed of in an amount determined as provided in the final paragraph of the
"Restricted Payments" covenant. The acquisition by us or any of our Subsidiaries
of a Person that holds an Investment in a third Person will be deemed to be an
Investment by us or such Subsidiary in such third Person in an amount equal to
the fair market value of the Investment held by the acquired Person in such
third Person in an amount determined as provided in the final paragraph of the
"Restricted Payments" covenant.

     "Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law,
including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction.

                                       100


     "Net Income" means, with respect to any specified Person, the net income
(loss) of such Person, determined in accordance with GAAP and before any
reduction in respect of preferred stock dividends, excluding, however:

          (1)  any gain (but not loss), together with any related provision for
     taxes on such gain (but not loss), realized in connection with: (a) any
     Asset Sale or (b) the disposition of any securities by such Person or any
     of its Restricted Subsidiaries or the extinguishment of any Indebtedness of
     such Person or any of its Restricted Subsidiaries; and

          (2)  any extraordinary gain (but not loss), together with any related
     provision for taxes on such extraordinary gain (but not loss).

     "Net Proceeds" means the aggregate cash proceeds received by us or any of
our Restricted Subsidiaries in respect of any Asset Sale (including, without
limitation, any cash received upon the sale or other disposition of any non-cash
consideration, including Designated Non-Cash Consideration, deemed to be cash
pursuant to the provisions of "Repurchase at the Option of Holders-Asset Sales,"
received in any Asset Sale), net of the direct costs relating to such Asset
Sale, including, without limitation, legal, accounting and investment banking
fees, and sales commissions, and any relocation expenses incurred as a result of
the Asset Sale, taxes paid or payable as a result of the Asset Sale, in each
case, after taking into account any available tax credits or deductions and any
tax sharing arrangements, and amounts required to be applied to the repayment of
Indebtedness, other than Senior Debt, secured by a Lien on the asset or assets
that were the subject of such Asset Sale, and any reserve for adjustment in
respect of the sale price of such asset or assets established in accordance with
GAAP.

     "Non-recourse Debt" means Indebtedness:

          (1) as to which neither we nor any of our Restricted Subsidiaries (a)
     provides credit support of any kind (including any undertaking, agreement
     or instrument that would constitute Indebtedness), (b) is directly or
     indirectly liable as a guarantor or otherwise, or (c) constitutes the
     lender;

          (2) no default with respect to which (including any rights that the
     holders thereof may have to take enforcement action against an Unrestricted
     Subsidiary) would permit upon notice, lapse of time or both any holder of
     any other Indebtedness (other than the notes) of ours or any of our
     Restricted Subsidiaries to declare a default on such other Indebtedness or
     cause the payment thereof to be accelerated or payable prior to its stated
     maturity; and

          (3) as to which the lenders have been notified in writing that they
     will not have any recourse to our stock or assets or the stock or assets of
     any of our Restricted Subsidiaries.

     "Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.

     "Parent" means Extendicare, Inc., a corporation organized under the laws of
Canada.

     "Permitted Business" means the lines of business conducted by us and our
Restricted Subsidiaries on the date of the indenture and the businesses
reasonably related thereto within the healthcare services sector.

     "Permitted Investments" means:

          (1) any Investment in us or in one of our Wholly Owned Restricted
     Subsidiaries;

          (2) any Investment outstanding as of the date hereof;

          (3) any Investment in Cash Equivalents;

          (4) loans and advances to employees and officers of us and our
     Restricted Subsidiaries in the ordinary course of business for bona fide
     business purposes not in excess of $1.0 million at any one time
     outstanding;

                                       101


          (5) Investments in prepaid expenses, negotiable instruments held for
     collection and lease, utility and workers' compensation, performance and
     other similar deposits;

          (6) any Investment by us or any of our Restricted Subsidiaries in a
     Person engaged in a Permitted Business, if as a result of such Investment:

             (a) such Person becomes one of our Wholly Owned Restricted
        Subsidiaries; or

             (b) such Person is merged, consolidated or amalgamated with or
        into, or transfers or conveys substantially all of its assets to, or is
        liquidated into, us or one of our Wholly Owned Restricted Subsidiaries;

          (7) any Investment made as a result of the receipt of non-cash
     consideration (including Designated Non-Cash Consideration) from an Asset
     Sale that was made pursuant to and in compliance with the covenant
     described above under "-- Repurchase at the Option of Holders -- Asset
     Sales;"

          (8) any acquisition of assets, Equity Interests or other securities
     solely in exchange for the issuance of our Equity Interests (other than
     Disqualified Stock);

          (9) any Investments received in compromise of obligations of such
     Persons incurred in the ordinary course of trade creditors or customers
     that were incurred in the ordinary course of business, including pursuant
     to any plan of reorganization or similar arrangement upon the bankruptcy or
     insolvency of any trade creditor or customer;

          (10) Hedging Obligations;

          (11) any Investment made in a Special Purpose Vehicle in connection
     with a Securitization Transaction or to provide adequate capital to a
     Special Purpose Vehicle in anticipation of one or more Securitization
     Transactions; and

          (12) other Investments in any Person having an aggregate fair market
     value (measured on the date each such Investment was made and without
     giving effect to subsequent changes in value), when taken together with all
     other Investments made pursuant to this clause (12) that are at the time
     outstanding, not to exceed $10.0 million.

          "Permitted Liens" means:

          (1) Liens securing Indebtedness under Credit Facilities, including the
     Credit Agreement, where such Indebtedness was permitted by the terms of the
     indenture to be incurred;

          (2) Liens in favor of us or the Subsidiary Guarantors;

          (3) Liens on property of a Person existing at the time such Person is
     merged with or into or consolidated with us or any Restricted Subsidiary of
     ours; provided that such Liens were in existence prior to the contemplation
     of such merger or consolidation and do not extend to any assets other than
     those of the Person merged into or consolidated with us or such Restricted
     Subsidiary;

          (4) Liens on property existing at the time of acquisition of the
     property by us or any of our Restricted Subsidiaries; provided that such
     Liens were in existence prior to the contemplation of such acquisition;

          (5) Liens to secure the performance of statutory obligations, surety
     or appeal bonds, performance bonds or other obligations of a like nature;

          (6) Liens to secure Indebtedness (including Capital Lease Obligations)
     permitted by clause (4) of the second paragraph of the "Incurrence of
     Indebtedness and Issuance of Preferred Stock" covenant covering only the
     assets acquired with such Indebtedness;

          (7) Liens existing on the date of the indenture;

                                       102


          (8) Liens for taxes, assessments or governmental charges or claims
     that are not yet delinquent or that are being contested in good faith by
     appropriate proceedings promptly instituted and diligently concluded;
     provided that any reserve or other appropriate provision as is required in
     conformity with GAAP has been made therefor;

          (9) pledges or deposits in the ordinary course of business to secure
     lease obligations or nondelinquent obligations under workers' compensation,
     unemployment insurance or similar legislation;

          (10) easements, rights-of-way, restrictions, minor defects or
     irregularities in title and other similar charges or encumbrances not
     interfering in any material respect with our business or assets or the
     business or assets of any of our Subsidiaries incurred in the ordinary
     course of business;

          (11) Liens to secure Hedging Obligations;

          (12) Liens incurred in connection with a sale and leaseback
     transaction permitted under "Sale and Leaseback Transactions" that do not
     exceed 5% of our Consolidated Tangible Assets; and

          (13) Liens incurred by us or any Restricted Subsidiary of ours with
     respect to obligations that do not exceed $10.0 million at any one time
     outstanding; provided that such amount shall be reduced by any amount
     incurred under clause (12) above.

     "Permitted Refinancing Indebtedness" means any Indebtedness of ours or any
of our Restricted Subsidiaries issued in exchange for, or the net proceeds of
which are used to extend, refinance, renew, replace, defease or refund other
Indebtedness of ours or any of our Restricted Subsidiaries (other than
intercompany Indebtedness); provided that:

          (1) the principal amount (or accreted value, if applicable) of such
     Permitted Refinancing Indebtedness does not exceed the principal amount (or
     accreted value, if applicable) of the Indebtedness extended, refinanced,
     renewed, replaced, defeased or refunded (plus all accrued interest on the
     Indebtedness and the amount of all expenses and premiums incurred in
     connection therewith);

          (2) such Permitted Refinancing Indebtedness has a final maturity date
     later than the final maturity date of, and has a Weighted Average Life to
     Maturity equal to or greater than the Weighted Average Life to Maturity of,
     the Indebtedness being extended, refinanced, renewed, replaced, defeased or
     refunded;

          (3) either

             (a) if the Indebtedness being extended, refinanced, renewed,
        replaced, defeased or refunded is subordinated in right of payment to
        the notes (including the Senior Subordinated Notes), such Permitted
        Refinancing Indebtedness has a final maturity date later than the final
        maturity date of, and is subordinated in right of payment to, the notes
        on terms at least as favorable to the Holders of notes as those
        contained in the documentation governing the Indebtedness being
        extended, refinanced, renewed, replaced, defeased or refunded, or

             (b) with respect to only the Senior Subordinated Notes, at the time
        of such incurrence our Consolidated Senior Debt Leverage Ratio would
        have been less than 2.75 to 1; provided that when calculating such
        ratio, pro forma effect will be given to (A) the incurrence of such
        Indebtedness and the application of the proceeds therefrom, including to
        refinance the Senior Subordinated Notes and (B) the acquisition (whether
        by purchase, merger or otherwise) or disposition (whether by sale,
        merger or otherwise) of any company, entity or business acquired or
        disposed of by us or our Restricted Subsidiaries, as the case may be,
        since the first day of the four-quarter period referred to in the
        definition of Consolidated Senior Debt Leverage Ratio as if such
        acquisition or disposition had occurred at the beginning of such
        four-quarter period; and

          (4) such Indebtedness is incurred either by us or by the Subsidiary
     who is the obligor on the Indebtedness being extended, refinanced, renewed,
     replaced, defeased or refunded.

                                       103


     "Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization, limited
liability company or government or other entity.

     "Qualified Equity Offering" means any underwritten public or any private
offering of our Capital Stock (excluding Disqualified Stock) or any of Parent's
Capital Stock (excluding Disqualified Stock), in the latter case, only to the
extent that the net cash proceeds therefrom are contributed to our common or
non-redeemable preferred equity capital.

     "Replacement Assets" means any properties or assets used or useful in a
Permitted Business.

     "Restricted Investment" means an Investment other than a Permitted
Investment.

     "Restricted Subsidiary" of a Person means any Subsidiary of the referent
Person that is not an Unrestricted Subsidiary.

     "SEC" means the Securities and Exchange Commission.

     "Securitization Transaction" means any sale, conveyance or other
disposition by us or any of our Restricted Subsidiaries of any accounts
receivable or any interest therein to a Special Purpose Vehicle.

     "Senior Debt" means:

          (1) all Indebtedness of ours or of any Subsidiary Guarantor
     outstanding under Credit Facilities and all Hedging Obligations with
     respect thereto;

          (2) any other Indebtedness of ours or of any Subsidiary Guarantor
     permitted to be incurred under the terms of the indenture, unless the
     instrument under which such Indebtedness is incurred expressly provides
     that it is on a parity with or subordinated in right of payment to the
     notes or any Subsidiary Guarantee; and

          (3)  all Obligations with respect to the items listed in the preceding
     clauses (1) and (2).

     Notwithstanding anything to the contrary in the preceding, Senior Debt will
not include:

          (1)  any liability for federal, state, local or other taxes owed or
     owing by us;

          (2)  any Indebtedness of ours to any of our Subsidiaries or other
     Affiliates;

          (3)  any trade payables; or

          (4)  the portion of any Indebtedness that is incurred in violation of
     the indenture.

     "Senior Subordinated Notes" means our 9.35% Senior Subordinated Notes due
2007.

     "Significant Subsidiary" means any Subsidiary that would be a "significant
subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated
pursuant to the Securities Act, as such Regulation is in effect on the date of
the indenture.

     "Special Purpose Vehicle" means a bankruptcy-remote entity or trust or
other special purpose entity which is formed by us, any Subsidiary of ours or
any other Person for the purpose of, and engages in no material business other
than, acting as a buyer in a Securitization Transaction or other similar
transactions of accounts receivable or other similar assets, financing the
purchases it makes as such a buyer and realizing, directly or indirectly, on
such accounts receivable or other similar assets.

     "Stated Maturity" means, with respect to any installment of interest or
principal on any series of Indebtedness (including, without limitation, a
scheduled repayment or a scheduled sinking fund payment), the date on which the
payment of interest or principal was scheduled to be paid in the original
documentation governing such Indebtedness, and will not include any contingent
obligations to repay, redeem or repurchase any such interest or principal prior
to the date originally scheduled for the payment thereof.

     "Subordinated Indebtedness" means any Indebtedness (whether outstanding on
the Issue Date or thereafter incurred, including the Senior Subordinated Notes)
that is subordinated or junior in right of
                                       104


payment to the notes or the Subsidiary Guarantees pursuant to a written
agreement, executed by the Person to whom such Indebtedness is owed, to that
effect.

     "Subsidiary" means, with respect to any specified Person:

          (1)  any corporation, association or other business entity of which
     more than 50% of the total voting power of shares of Capital Stock entitled
     (without regard to the occurrence of any contingency) to vote in the
     election of directors, managers or trustees of the corporation, association
     or other business entity is at the time owned or controlled, directly or
     indirectly, by that Person or one or more of the other Subsidiaries of that
     Person (or a combination thereof); and

          (2)  any partnership (a) the sole general partner or the managing
     general partner of which is such Person or a Subsidiary of such Person or
     (b) the only general partners of which are that Person or one or more
     Subsidiaries of that Person (or any combination thereof).

     "Subsidiary Guarantee" means the Guarantee of the notes by each of the
Subsidiary Guarantors pursuant to the indenture and any additional Guarantee of
the notes to be executed by any Subsidiary of ours pursuant to the covenant
described above under "-- Additional Subsidiary Guarantees."

     "Subsidiary Guarantors" means all of our existing and future domestic
Significant Subsidiaries, all of our existing and future Domestic Subsidiaries
that guarantee or incur any Indebtedness and any other existing or future
Significant Subsidiaries or Restricted Subsidiaries that guarantee or otherwise
provide direct credit support for Indebtedness of ours or any of our Domestic
Subsidiaries.

     "Unrestricted Subsidiary" means any Subsidiary of ours (or any successor to
any of them) that is designated by our Board of Directors as an Unrestricted
Subsidiary pursuant to a board resolution, but only to the extent that such
Subsidiary:

          (1)  has no Indebtedness other than Non-Recourse Debt;

          (2)  is not party to any agreement, contract, arrangement or
     understanding with us or any Restricted Subsidiary of ours unless the terms
     of any such agreement, contract, arrangement or understanding are no less
     favorable to us or such Restricted Subsidiary than those that might be
     obtained at the time from Persons who are not Affiliates of ours;

          (3)  is a Person with respect to which neither we nor any of our
     Restricted Subsidiaries has any direct or indirect obligation (a) to
     subscribe for additional Equity Interests or (b) to maintain or preserve
     such Person's financial condition or to cause such Person to achieve any
     specified levels of operating results;

          (4)  has not guaranteed or otherwise directly or indirectly provided
     credit support for any Indebtedness of ours or any of our Restricted
     Subsidiaries; and

          (5)  has at least one director on its Board of Directors that is not a
     director or executive officer of ours or any of our Restricted Subsidiaries
     and has at least one executive officer that is not a director or executive
     officer of ours or any of our Restricted Subsidiaries.

     Any designation of a Subsidiary of ours as an Unrestricted Subsidiary will
be evidenced to the trustee by filing with the trustee a certified copy of the
board resolution giving effect to such designation and an officers' certificate
certifying that such designation complied with the preceding conditions and was
permitted by the "-- Restricted Payments" covenant. If, at any time, any
Unrestricted Subsidiary would fail to meet the preceding requirements as an
Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted
Subsidiary for purposes of the indenture and any Indebtedness of such Subsidiary
will be deemed to be incurred by a Restricted Subsidiary of ours as of such date
and, if such Indebtedness is not permitted to be incurred as of such date under
the "-- Incurrence of Indebtedness and Issuance of Preferred Stock" covenant, we
will be in default of such covenant. Our Board of Directors may at any time
designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided
that such designation will be deemed to be an incurrence of Indebtedness by one
of our Restricted Subsidiaries of any outstanding Indebtedness of such
Unrestricted Subsidiary and such designation will only be permitted if
                                       105


(1) such Indebtedness is permitted under the "-- Incurrence of Indebtedness and
Issuance of Preferred Stock" covenant, calculated on a pro forma basis as if
such designation had occurred at the beginning of the four-quarter reference
period; (2) no Default or Event of Default would be in existence following such
designation; and (3) such Subsidiary executes and delivers to the trustee a
supplemental indenture providing for a Subsidiary Guarantee.

     "Voting Stock" of any Person as of any date means the Capital Stock of such
Person that is at the time entitled to vote in the election of the Board of
Directors of such Person.

     "Weighted Average Life to Maturity" means, when applied to any Indebtedness
at any date, the number of years obtained by dividing:

          (1)  the sum of the products obtained by multiplying (a) the amount of
     each then remaining installment, sinking fund, serial maturity or other
     required payments of principal, including payment at final maturity, in
     respect of the Indebtedness, by (b) the number of years (calculated to the
     nearest one-twelfth) that will elapse between such date and the making of
     such payment; by

          (2)  the then outstanding principal amount of such Indebtedness.

                                       106


                 CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS

     THIS SUMMARY IS OF A GENERAL NATURE AND IS INCLUDED HEREIN SOLELY FOR
INFORMATIONAL PURPOSES. IT IS NOT INTENDED TO BE, NOR SHOULD IT BE CONSTRUED AS
BEING, LEGAL OR TAX ADVICE. NO REPRESENTATION WITH RESPECT TO THE CONSEQUENCES
OF ANY PARTICULAR PURCHASER OF THE NEW NOTES IS MADE. PROSPECTIVE PURCHASERS
SHOULD CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THEIR PARTICULAR
CIRCUMSTANCES.

     The following general discussion summarizes the material U.S. federal
income tax aspects of the exchange offer to holders of old notes. The discussion
is for general information purposes only, is limited to U.S. federal income tax
consequences of the exchange offer, and does not consider the aspects of the
ownership and dispositions of the old notes or the new notes. A discussion of
the U.S. federal income tax consequences of holding and disposing of the notes
is contained in the offering memorandum with respect to the old notes.

     The following summary deals only with notes held as capital assets by
purchasers at the issue price who are U.S. holders and not with special classes
of holders, such as dealers in securities or currencies, financial institutions,
life insurance companies, tax-exempt entities, persons holding notes as part of
a hedge, conversion, constructive sale transaction, straddle or other risk
reduction strategy, and persons whose functional currency is not the U.S.
dollar. Persons considering the purchase of notes should consult their own tax
advisors concerning these matters and as to the tax treatment under foreign,
state and local tax laws and regulations. We cannot provide any assurance that
the Internal Revenue Service will not challenge the conclusions stated below. We
have not sought and will not seek a ruling from the Internal Revenue Service on
any of the matters discussed below.

     This summary is based upon the Internal Revenue Code of 1986, Treasury
Regulations, Internal Revenue Service rulings and pronouncements and judicial
decisions now in effect, all of which are subject to change at any time. Changes
in this area of law may be applied retroactively in a manner that could cause
the tax consequences to vary substantially from the consequences described
below, possibly adversely affecting a U.S. holder of notes. The authorities on
which this discussion is based are subject to various interpretations, and it is
therefore possible that the federal income tax treatment of the exchange of old
notes for the new notes may differ from the treatment described below.

     The exchange of old notes for the new notes under the terms of the exchange
offer should not constitute a taxable exchange. As a result:

     - A holder should not recognize taxable gain or loss as a result of
       exchanging old notes for the new notes under the terms of the exchange
       offer;

     - The holder's holding period of the new notes should include the holding
       period of the old notes exchanged for the new notes; and

     - A holder's adjusted tax basis in the new notes should be the same as the
       adjusted tax basis, immediately before the exchange, of the old notes
       exchanged for the new notes.

                                       107


                              PLAN OF DISTRIBUTION

     If you are a broker-dealer and hold old notes for your own account as a
result of market-making activities or other trading activities and you receive
new notes in exchange for old notes in the exchange offer, then you may be a
statutory underwriter and must acknowledge that you will deliver a prospectus in
connection with any resale of these new notes. This prospectus, as it may be
amended or supplemented from time to time, may be used by a broker-dealer in
connection with resales of new notes received in exchange for old notes where
such old notes were acquired as a result of market-making activities or other
trading activities. We acknowledge and, unless you are a broker-dealer, you must
acknowledge that you are not engaged in, do not intend to engage in, and have no
arrangement or understanding with any person to participate in a distribution of
new notes. We have agreed that we will make this prospectus, as amended or
supplemented, available to any broker-dealer for use in connection with any such
resale.

     Neither we nor any subsidiary guarantor will receive any proceeds in
connection with the exchange offer or any sale of new notes by broker-dealers.
New notes received by broker-dealers for their own account pursuant to the
exchange offer may be sold from time to time in one or more transactions in the
over-the-counter market, in negotiated transactions, through the writing of
options on the new notes or a combination of these methods of resale, at market
prices prevailing at the time of resale, at prices related to such prevailing
market prices or negotiated prices. Any resale may be made directly to
purchasers or to or through brokers or dealers who may receive compensation in
the form of commissions or concessions from any such broker-dealers or the
purchasers of any such new notes. Any broker-dealer that resells new notes that
were received by it for its own account pursuant to the exchange offer and any
broker-dealer that participates in a distribution of such new notes may be
deemed to be an "underwriter" within the meaning of the Securities Act and any
profit on any such resale of new notes and any commissions or concessions
received by any such persons may be deemed to be underwriting compensation under
the Securities Act. The letter of transmittal states that by acknowledging that
it will deliver, and by delivering, a prospectus, a broker-dealer will not be
deemed to admit that it is an "underwriter" within the meaning of the Securities
Act. See "The Exchange Offer -- Resales of New Notes."

                                 LEGAL MATTERS

     Foley & Lardner, Milwaukee, Wisconsin, will issue an opinion about some
legal matters with respect to the new notes and the new guarantees.

                                    EXPERTS

     The consolidated financial statements of Extendicare Health Services, Inc.
and subsidiaries as of December 31, 2001 and 2000, and for each of the years in
the three-year period ended December 31, 2001 and the related financial
statement schedule have been included herein in reliance upon the reports of
KPMG LLP, independent accountants, appearing elsewhere herein, and upon the
authority of said firm as experts in accounting and auditing.

                      WHERE YOU CAN FIND MORE INFORMATION

     We file annual, quarterly and current reports and other information with
the Securities and Exchange Commission. You may read and copy any document we
file at the SEC's public reference rooms at 450 Fifth Street, N.W., Washington,
D.C. and at regional offices in New York, New York and Chicago, Illinois. Please
call the SEC at 1-800-SEC-0330 for further information on the public reference
rooms. Our SEC filings are also available to the public at the SEC's web site at
http://www.sec.gov.

                                       108


                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

                                                           
Independent Auditors' Report................................  F-2
Consolidated Balance Sheets as of March 31, 2002 (unaudited)
  and as of December 31, 2001 and 2000......................  F-3
Consolidated Statements of Operations for the Three Months
  Ended March 31, 2001 and 2000 (unaudited) and for the
  Years Ended December 31, 2001, 2000 and 1999..............  F-4
Consolidated Statements of Changes in Shareholder's Equity
  for the Three Months Ended March 31, 2002 (unaudited) and
  for the Years Ended December 31, 2001, 2000 and 1999......  F-5
Consolidated Statements of Cash Flows for the Three Months
  Ended March 31, 2002 and 2001 (unaudited) and for the
  Years Ended December 31, 2001, 2000 and 1999..............  F-6
Notes to Consolidated Financial Statements..................  F-7



                                       F-1


                          INDEPENDENT AUDITORS' REPORT

The Board of Directors
Extendicare Health Services, Inc.:

     We have audited the accompanying consolidated balance sheets of Extendicare
Health Services, Inc. and subsidiaries (the Company) as of December 31, 2001 and
2000, and the related consolidated statements of operations, shareholder's
equity, and cash flows for each of the years in the three-year period ended
December 31, 2001. These consolidated financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these consolidated financial statements based on our audits.

     We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

     In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Extendicare
Health Services, Inc. and subsidiaries as of December 31, 2001 and 2000, and the
results of their operations and their cash flows for each of the years in the
three-year period ended December 31, 2001 in conformity with accounting
principles generally accepted in the United States of America.

[KPMG LLP LOGO]

Milwaukee, Wisconsin
February 6, 2002

                                       F-2


                       EXTENDICARE HEALTH SERVICES, INC.

                          CONSOLIDATED BALANCE SHEETS
                        (IN THOUSANDS EXCEPT SHARE DATA)



                                                                                DECEMBER 31,
                                                              MARCH 31,     --------------------
                                                                2002          2001        2000
                                                             -----------    --------    --------
                                                             (UNAUDITED)
                                                                               
ASSETS
CURRENT ASSETS:
  Cash and cash equivalents................................    $  2,993     $    997    $  1,641
  Accounts receivable, less allowances of $15,295, $14,577
     and $16,329, respectively.............................      99,990      104,236     130,032
  Supplies, inventories and other current assets...........       7,127        6,809       9,454
  Deferred state income taxes..............................          91           --          --
  Due from shareholder:
     Federal income taxes receivable.......................       9,478        9,468      24,235
     Deferred federal income taxes.........................      11,949       11,474      10,782
                                                               --------     --------    --------
     Total current assets..................................     131,628      132,984     176,144
Property and equipment (Note 5)............................     471,586      477,830     507,536
Deferred state income taxes................................          --           --         386
Goodwill and other intangible assets (Note 6)..............      77,277       77,592      81,310
Other assets (Note 7)......................................     105,234      107,430     108,214
                                                               --------     --------    --------
     Total Assets..........................................    $785,725     $795,836    $873,590
                                                               ========     ========    ========
LIABILITIES AND SHAREHOLDER'S EQUITY
CURRENT LIABILITIES:
  Bank indebtedness........................................    $  4,457     $    590    $    538
  Current maturities of long-term debt (Note 8)............       7,223       12,099      12,706
  Accounts payable.........................................      18,298       23,172      22,211
  Accrued liabilities (Note 9).............................      95,494       82,736      85,374
  Income taxes payable.....................................       1,592        1,556       1,344
  Deferred state income taxes..............................          --           --         181
  Due to shareholder and affiliates........................       4,026        8,686       9,317
                                                               --------     --------    --------
     Total current liabilities.............................     131,090      128,839     131,671
Accrual for self-insured liabilities (Note 10).............      62,472       70,341      50,087
Long-term debt (Note 8)....................................     365,301      373,248     438,441
Deferred state income taxes................................         358           --          --
Other long-term liabilities (Note 11)......................      44,256       44,018      40,716
Due to shareholder and affiliates:
  Deferred federal income taxes............................      21,127       19,904      25,001
  Other....................................................       3,484        3,484       3,484
Minority interests.........................................          --           --          29
                                                               --------     --------    --------
     Total liabilities.....................................     628,088      639,834     689,429
                                                               --------     --------    --------
SHAREHOLDER'S EQUITY:
  Common stock, $1 par value, 1,000 shares authorized, 947
     shares issued and outstanding.........................           1            1           1
  Additional paid-in capital...............................     208,787      208,787     208,787
  Accumulated other comprehensive loss.....................      (2,389)      (2,367)     (1,703)
  Accumulated deficit......................................     (48,762)     (50,419)    (22,924)
                                                               --------     --------    --------
     Total Shareholder's Equity............................     157,637      156,002     184,161
                                                               --------     --------    --------
     Total Liabilities and Shareholder's Equity............    $785,725     $795,836    $873,590
                                                               ========     ========    ========


  The accompanying notes are an integral part of these consolidated financial
                                  statements.
                                       F-3


                       EXTENDICARE HEALTH SERVICES, INC.

                     CONSOLIDATED STATEMENTS OF OPERATIONS
                                 (IN THOUSANDS)



                                           THREE MONTHS ENDED
                                                MARCH 31,             YEAR ENDED DECEMBER 31,
                                           -------------------   ----------------------------------
                                             2002       2001       2001        2000         1999
                                           --------   --------   --------   ----------   ----------
                                               (UNAUDITED)
                                                                          
REVENUES:
  Nursing and assisted living centers
     (Note 12)...........................  $190,998   $186,556   $766,952   $  904,847   $  916,195
  Outpatient therapy and medical
     supplies............................     2,452      2,322      9,515        9,716       43,068
  Other..................................     4,791      4,554     17,640        8,506        8,322
                                           --------   --------   --------   ----------   ----------
                                            198,241    193,432    794,107      923,069      967,585
                                           --------   --------   --------   ----------   ----------
COSTS AND EXPENSES (INCOME):
  Operating..............................   166,604    170,064    684,814      825,172      844,391
  General and administrative.............     8,211      8,424     32,387       46,507       45,524
  Lease costs............................     3,034      3,817     14,575       15,731       16,631
  Depreciation and amortization..........     9,434     10,298     40,772       45,434       52,005
  Interest expense.......................     8,330     10,283     37,857       46,541       52,499
  Interest income........................      (342)      (433)    (2,297)      (1,386)      (1,232)
  Loss on impairment of long-lived assets
     (Note 4)............................        --         --      1,685       20,753       38,173
  Loss of disposal of assets and other
     items (Note 4)......................        --      1,409     24,246        6,663       42,774
                                           --------   --------   --------   ----------   ----------
                                            195,271    203,862    834,039    1,005,415    1,090,765
                                           --------   --------   --------   ----------   ----------
INCOME (LOSS) BEFORE INCOME TAXES........     2,970    (10,430)   (39,932)     (82,346)    (123,180)
  Income tax expense (benefit) (Note
     17).................................     1,313     (3,679)   (12,482)     (27,667)     (52,841)
                                           --------   --------   --------   ----------   ----------
LOSS BEFORE MINORITY INTERESTS AND
  EXTRAORDINARY ITEM.....................     1,657     (6,751)   (27,450)     (54,679)     (70,339)
  Minority interests.....................        --         --         --           --          224
                                           --------   --------   --------   ----------   ----------
LOSS BEFORE EXTRAORDINARY
  ITEM...................................     1,657     (6,751)   (27,450)     (54,679)     (70,115)
  Extraordinary loss on early retirement
     of debt (net of income taxes of $30,
     $257 and $240, respectively) (Note
     8)..................................        --         --        (45)        (442)        (342)
                                           --------   --------   --------   ----------   ----------
NET EARNINGS (LOSS)......................  $  1,657   $ (6,751)  $(27,495)  $  (55,121)  $  (70,457)
                                           ========   ========   ========   ==========   ==========


  The accompanying notes are an integral part of these consolidated financial
                                  statements.
                                       F-4


                       EXTENDICARE HEALTH SERVICES, INC.

                CONSOLIDATED STATEMENTS OF SHAREHOLDER'S EQUITY
                        (IN THOUSANDS EXCEPT SHARE DATA)



                                                                                    RETAINED
                                                                   ACCUMULATED      EARNINGS
                                    COMMON STOCK     ADDITIONAL       OTHER       (ACCUMULATED        TOTAL
                                   ---------------    PAID-IN     COMPREHENSIVE   SHAREHOLDER'S   SHAREHOLDER'S
                                   SHARES   AMOUNT    CAPITAL     INCOME (LOSS)     DEFICIT)         EQUITY
                                   ------   ------   ----------   -------------   -------------   -------------
                                                                                
BALANCES AT DECEMBER 31, 1998....   947       $1      $208,787       $   187        $102,654        $311,629
  Comprehensive income (loss):
     Unrealized loss on
       investments, net of income
       taxes.....................    --       --            --        (3,277)             --          (3,277)
     Net loss....................    --       --            --            --         (70,457)        (70,457)
                                    ---       --      --------       -------        --------        --------
  Total comprehensive income
     (loss)......................    --       --            --        (3,277)        (70,457)        (73,734)
                                    ---       --      --------       -------        --------        --------
BALANCES AT DECEMBER 31, 1999....   947        1       208,787        (3,090)         32,197         237,895
  Comprehensive income (loss):
     Unrealized gain on
       investments, net of income
       taxes.....................    --       --            --         1,387              --           1,387
     Net loss....................    --       --            --            --         (55,121)        (55,121)
                                    ---       --      --------       -------        --------        --------
  Total comprehensive income
     (loss)......................    --       --            --         1,387         (55,121)        (53,734)
                                    ---       --      --------       -------        --------        --------
BALANCES AT DECEMBER 31, 2000....   947        1       208,787        (1,703)        (22,924)        184,161
  Comprehensive income (loss):
     Unrealized gain on
       investments, net of income
       taxes.....................    --       --            --           441              --             441
     Unrealized loss on cash flow
       hedges, net of income
       taxes.....................    --       --            --        (1,105)             --          (1,105)
     Net loss....................    --       --            --            --         (27,495)        (27,495)
                                    ---       --      --------       -------        --------        --------
  Total comprehensive income
     (loss)......................    --       --            --          (664)        (27,495)        (28,159)
                                    ---       --      --------       -------        --------        --------
BALANCES AT DECEMBER 31, 2001....   947        1       208,787        (2,367)        (50,419)        156,002
  Comprehensive Income (loss)
     (unaudited):
     Unrealized loss on
       investments, net of income
       taxes (unaudited).........    --       --            --          (514)             --            (514)
     Unrealized gain on cash flow
       hedges, net of income
       taxes (unaudited).........    --       --            --           492              --             492
     Net earnings (unaudited)....    --       --            --            --           1,657           1,657
                                    ---       --      --------       -------        --------        --------
  Total comprehensive income
     (loss) (unaudited)..........    --       --            --           (22)          1,657           1,635
                                    ---       --      --------       -------        --------        --------
BALANCES AT MARCH 31, 2002
  (UNAUDITED)....................   947       $1      $208,787       $(2,389)       $(48,762)       $157,637
                                    ===       ==      ========       =======        ========        ========


  The accompanying notes are an integral part of these consolidated financial
                                  statements.
                                       F-5


                       EXTENDICARE HEALTH SERVICES, INC.

                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)



                                                THREE MONTHS ENDED
                                                     MARCH 31,           YEAR ENDED DECEMBER 31,
                                                -------------------   ------------------------------
                                                  2002       2001       2001       2000       1999
                                                --------   --------   --------   --------   --------
                                                    (UNAUDITED)
                                                                             
OPERATING ACTIVITIES:
Net earnings (loss)...........................  $  1,657   $ (6,751)  $(27,495)  $(55,121)  $(70,457)
Adjustments to reconcile net earnings (loss)
  to net cash provided from operating
  activities..................................
  Depreciation and amortization...............     9,937     10,828     42,855     47,886     54,254
  Provision for self-insured liabilities......     1,313      1,875     29,177     46,248      4,329
  Payment for self-insured liability claims...    (9,181)      (700)    (8,924)      (490)        --
  Provision for punitive damages..............                              --      9,000         --
  Provision for uncollectible accounts
     receivable...............................     2,957      2,246      8,945     17,945     11,905
  (Recovery) reserve for settlements with
     third-party payors.......................        --         --         --    (11,981)    27,400
  Loss on disposal of assets and other
     items....................................        --      1,409     13,282      6,663     13,774
  Loss on impairment of long-lived assets.....        --         --      1,685     20,753     38,173
  Deferred income taxes.......................     1,106     (3,802)   (13,026)   (13,454)   (12,848)
  Extraordinary loss on early retirement of
     debt.....................................        --         --         45        442        342
  Minority interests..........................        --         --         --         --       (224)
  Changes in assets and liabilities:
     Accounts receivable......................      (927)    20,907     16,810     (2,362)     4,314
     Non-current accounts receivable..........        --         --        804     (9,702)        --
     Supplies, inventories and prepaid
       expenses...............................      (248)     1,837      2,530        458        111
     Debt service trust funds.................       (69)       (70)         1      1,863        100
     Accounts payable.........................    (9,545)    (9,754)       962     (9,986)    (4,446)
     Accrued liabilities......................    13,352      3,058    (13,843)   (16,368)   (33,263)
     Income taxes payable/receivable..........        36     (1,027)       212        169     (1,897)
     Current due to shareholder and
       affiliates.............................        --         --     21,907        879    (12,924)
                                                --------   --------   --------   --------   --------
     Cash provided from operating
       activities.............................    10,388     20,056     75,927     32,842     18,643
                                                --------   --------   --------   --------   --------
INVESTING ACTIVITIES:
  Proceeds from sale of property and
     equipment................................     1,729          5      7,599      7,642     48,522
  Proceeds received from divestiture
     agreement................................        --         --         --     30,000         --
  Income taxes recovered (paid) on sale of
     operations...............................        --         --         --     29,000    (25,000)
  Payments for purchases of property and
     equipment................................    (3,130)    (2,929)   (16,348)   (14,169)   (25,330)
  Changes in other non-current assets.........     1,060        441     (1,307)    (1,945)     1,692
                                                --------   --------   --------   --------   --------
     Cash (used in) provided by investing
       activities.............................      (341)    (2,483)   (10,056)    50,528       (116)
                                                --------   --------   --------   --------   --------
FINANCING ACTIVITIES:
  Proceeds from issuance of long-term debt....    11,000         --         --      3,048     58,051
  Payments of long-term debt..................   (23,822)   (18,962)   (65,797)   (80,337)   (75,606)
  Other long-term liabilities.................       903       (804)      (742)    (1,435)    (4,959)
  Bank indebtedness...........................     3,868      2,014         51     (5,357)     5,895
  Distribution of minority interests'
     earnings.................................        --         --        (27)      (589)       (51)
                                                --------   --------   --------   --------   --------
     Cash used in financing activities........    (8,051)   (17,752)   (66,515)   (84,670)   (16,670)
                                                --------   --------   --------   --------   --------
(Decrease) increase in cash and cash
  equivalents.................................     1,996       (179)      (644)    (1,300)     1,857
Cash and cash equivalents, beginning of
  year........................................       997      1,641      1,641      2,941      1,084
                                                --------   --------   --------   --------   --------
Cash and cash equivalents, end of year........  $  2,993   $  1,462   $    997   $  1,641   $  2,941
                                                ========   ========   ========   ========   ========


  The accompanying notes are an integral part of these consolidated financial
                                  statements.
                                       F-6


                       EXTENDICARE HEALTH SERVICES, INC.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. BUSINESS

     Extendicare Health Services, Inc. and its subsidiaries (hereafter referred
to as the "Company") operate nursing and assisted living facilities throughout
the United States. The Company is an indirect wholly owned subsidiary of
Extendicare Inc. ("Extendicare"), a Canadian publicly traded company.

     At December 31, 2001, the Company operated 157 nursing facilities with
capacity for 16,490 beds and 41 assisted living facilities with 1,912 units.
Through its nursing centers, the Company provides nursing, rehabilitative and
other specialized medical services and, in the assisted living facilities, the
Company provides varying levels of assistance with daily living activities to
residents. The Company also provides consulting services to 35 facilities (3,269
beds).

     In addition at December 31, 2001, the Company owned 17 nursing facilities
(1,862 beds), which were leased to and operated by three unrelated nursing home
providers, and retained an interest in (but did not operate) 11 nursing
facilities (1,435 beds) and 4 assisted living facilities (135 units) under a
Divestiture Agreement (see note 4).

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

  a) Principles of Consolidation

     The consolidated financial statements of the Company have been prepared in
accordance with accounting principles generally accepted in the United States of
America. The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amount of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Management's most significant estimates include provision for
bad debts, provision for Medicaid and Medicare revenue rate settlements,
recoverability of long-lived assets, provision for general liability, facility
closure accruals, workers compensation accruals and self-insured health and
dental claims. Actual results could differ from those estimates.

     The consolidated financial statements include those of the Company and its
subsidiaries and partnerships in which the Company has a controlling interest.
All significant intercompany accounts and transactions with subsidiaries have
been eliminated from the consolidated financial statements.

  b) Interim Financial Information (unaudited)

     The accompanying consolidated financial statements as of March 31, 2002 and
for the quarters ended March 31, 2002 and 2001 are unaudited and have been
prepared in accordance with the instructions to Rule 10-01 of Regulation S-X and
do not include all of the information and the footnotes required by generally
accepted accounting principles for complete statements. In the opinion of
management, all adjustments necessary for a fair presentation of such financial
statements have been included.

     Certain reclassifications have been made to the consolidated financial
statements for the first quarter of 2001 to conform to the presentation for
2002.

  c) Cash Equivalents

     For purposes of the consolidated statements of cash flows, the Company
considers all highly liquid investments with original maturities of three months
or less to be cash equivalents.

                                       F-7

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  d) Accounts Receivable

     Accounts receivable are recorded at the net realizable value expected to be
received from federal and state assistance programs, other third-party payors or
from individual patients. Receivables from government agencies represent the
only concentrated group of credit risk for the Company.

     Management does not believe there are any credit risks associated with
these government agencies other than possible funding delays. Accounts
receivable other than from government agencies consist of receivables from
various payors that are subject to differing economic conditions and do not
represent any concentrated credit risks to the Company. Furthermore, management
continually monitors and adjusts its allowances associated with these
receivables.

  e) Property and Equipment

     Property and equipment are stated at cost less accumulated depreciation and
amortization. Provisions for depreciation and amortization are computed using
the straight-line method at rates based upon the following estimated useful
lives:

                                        
Land improvements........................  10 to 25 years
Buildings................................  30 to 40 years
Building improvements....................  5 to 30 years
Furniture and equipment..................  Varying periods not exceeding 15 years
Leasehold improvements...................  The shorter of the term of the applicable
                                           leases or the useful life of the
                                           improvement



     Leased nursing home assets held under Option Agreements are stated at cost
less accumulated depreciation. Provisions for depreciation are computed as
outlined above.

     Maintenance and repairs are charged to expense as incurred. When property
or equipment is retired or disposed, the cost and related accumulated
depreciation and amortization are removed from the accounts and the resulting
gain or loss is included in the results of operations. Approximately $1,118,000,
$395,000 and $782,000 of costs included in furniture and equipment associated
with developing or obtaining internal-use software were capitalized during the
years ended December 31, 2001, 2000 and 1999, respectively, and are being
amortized over three years.

  f) Leases

     Leases that substantially transfer all of the benefits and risks of
ownership of property to the Company, or otherwise meet the criteria for
capitalizing a lease under generally accepted accounting principles, are
accounted for as capital leases. An asset is recorded at the time a capital
lease is entered into together with its related long-term obligation to reflect
its purchase and financing. Property and equipment recorded under capital leases
are depreciated on the same basis as previously described. Rental payments under
operating leases are expensed as incurred.

  g) Goodwill and Other Intangible Assets

     Goodwill represents the cost of acquired net assets in excess of their fair
market values. Amortization of goodwill and other intangible assets is computed
using the straight-line method over a period of no more than forty years in
connection with the acquisitions of long-term care facilities. Other intangible
assets, consisting of the costs of acquiring leasehold rights are deferred and
amortized over the term of the lease including renewal options. Refer to note 3
for the new accounting policy effective January 1, 2002.

                                       F-8

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  h) Impairment of Long-Lived Assets

     The Company periodically assesses the recoverability of long-lived assets,
including property and equipment, goodwill and other intangibles, when there are
indications of potential impairment based on estimates of undiscounted future
cash flows. The amount of any impairment is calculated by comparing the
estimated fair market value, with the carrying value of the related asset.
Management considers such factors as current results, trends and future
prospects, current market value, and other economic and regulatory factors, in
performing these analyses.

  i) Other Assets

     Assets held under Divestiture Agreement are stated at cost less accumulated
depreciation. Provisions for depreciation are computed as outlined above in note
2(d). Direct loan origination costs are deferred and amortized over the life of
the related debt using the effective interest method.

  j) Investments

     Debt service trust funds and other investment holdings, which are comprised
of fixed interest securities, equity securities, and liquid money market
investments, are considered to be available-for-sale and accordingly, are
reported at fair value. Fair values are based on quoted market prices.
Unrealized gains and losses, net of related tax effects, are reported within
Accumulated Other Comprehensive Income (AOCI) as a separate component of
shareholder's equity. A decline in the market value of any security below cost
that is deemed other than temporary is charged to earnings, resulting in the
establishment of a new cost basis for the security. The cost basis of the debt
service trust funds approximates fair value. Realized gains and losses for
securities classified as available-for-sale are included in the results of
operations and are derived using the specific identification method for
determining the cost of securities sold. Interest income is recognized when
earned.

  k) Revenue Recognition

     Nursing facility revenue results from the payment for services and products
from federal and state-funded cost reimbursement programs as well as private pay
residents. Revenues are recorded in the period in which services and products
are provided at established rates less contractual adjustments. Contractual
adjustments include differences between the Company's established billing rates
and amounts estimated by management as reimbursable under various reimbursement
formulas or contracts in effect. Estimation differences between final
settlements and amounts recorded in previous years are reported as adjustments
to revenues in the period such settlements are determined. Refer also to note
12.

     Assisted living facility revenue is primarily derived from private pay
residents in the period in which the services are provided and at rates
established by the Company based upon the services provided and market
conditions in the area of operation.

  l) Derivative Instruments and Hedging Activities

     In June 1998 the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 133, "Accounting for
Derivative Instruments and Certain Hedging Activities." In June 2000 the FASB
issued SFAS No. 138, "Accounting for Certain Derivative Instruments and Certain
Hedging Activity, an Amendment of SFAS 133." SFAS No. 133 and SFAS No. 138
require that all derivative instruments be recorded on the balance sheet at
their respective fair values. The Company adopted SFAS No. 133 and SFAS No. 138
on January 1, 2001. In accordance with the transition provisions of SFAS 133,
the Company recorded a net-of-tax cumulative-effect-type

                                       F-9

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

adjustment of $195,000 in AOCI to recognize at fair value all derivatives that
are designated as cash-flow hedging instruments.

     All derivatives are recognized on the balance sheet at their fair value. On
the date the derivative contract is entered into, the Company designates the
derivative as either a hedge of the fair value of a recognized asset or
liability ("fair value hedge") or a hedge of the variability of cash flows to be
received or paid related to a recognized asset or liability ("cash flow hedge").
The Company assesses, both at the hedge's inception and on an ongoing basis,
whether the derivatives that are used in hedging transactions are highly
effective in offsetting changes in fair values or cash flows of hedge items.
When it is determined that a derivative is not highly effective as a hedge or
that it has ceased to be a highly effective hedge, the Company discontinues the
hedge accounting prospectively.

     Changes in the fair value of a derivative that is highly effective and that
is designated and qualifies as a fair-value hedge, along with the loss or gain
on the hedged asset or liability of the hedged item that is attributable to the
hedged risk are recorded in earnings. Changes in the fair value of a derivative
that is highly effective and that is designated and qualifies as a cash-flow
hedge are recorded in other comprehensive income, until earnings are affected by
the variability in cash flows of the designated hedged item.

     The Company discontinues hedge accounting prospectively when it is
determined that the derivative is no longer effective in offsetting changes in
the fair value or cash flows of the hedged item, the derivative expires or is
sold, terminated, or exercised, or because management determines that
designation of the derivative as a hedging instrument is no longer appropriate.
When hedge accounting is discontinued because it is determined that the
derivative no longer qualifies as an effective fair-value hedge, the Company
continues to carry the derivative on the balance sheet at its fair value, and no
longer adjusts the hedged asset or liability for changes in fair value. In all
other situations in which hedge accounting is discontinued, the Company
continues to carry the derivative at its fair value on the balance sheet, and
recognizes any changes in its fair value in earnings.

     For years before 2001, prior to the adoption of SFAS No. 133, the Company
entered into interest rate swap agreements to reduce its exposure to market
risks from changing interest rates. For interest rate swaps, the differential to
be paid or received is accrued and recognized in interest expense and may change
as market interest rates change. If a swap was terminated prior to its maturity,
the gain or loss is recognized over the remaining original life of the swap if
the item hedged remains outstanding, or immediately, if the item hedged does not
remain outstanding.

  m) Income Taxes

     Income taxes are accounted for under the asset and liability method.
Deferred tax assets and liabilities are recognized for the expected future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases and operating loss and tax credit carry forwards. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences are expected to be
recovered or settled. The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in income in the period that includes the
enactment date.

  n) Reclassifications

     Certain reclassifications have been made to the 2000 and 1999 consolidated
financial statements to conform to the presentation for 2001.

                                       F-10

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

3. NEW ACCOUNTING PRONOUNCEMENTS

     In July 2001, the FASB issued SFAS No. 141, "Business Combinations" (SFAS
No. 141), and SFAS No. 142, "Goodwill and Other Intangible Assets" (SFAS No.
142). SFAS No. 141 requires that the purchase method of accounting be used for
all business combinations. SFAS No. 141 specifies criteria that intangible
assets acquired in a business combination must meet to be recognized and
reported separately from goodwill. SFAS No. 142 will require that goodwill and
intangible assets with indefinite useful lives no longer be amortized, but
instead tested for impairment at least annually in accordance with the
provisions of SFAS No. 142. SFAS No. 142 also requires that intangible assets
with estimable useful lives be amortized over their respective estimated useful
lives to their estimated residual values, and reviewed for impairment in
accordance with SFAS No. 121 and subsequently, SFAS No. 144 after its adoption.

     The Company adopted the provisions of SFAS No. 141 as of July 1, 2001, and
SFAS No. 142 is effective January 1, 2002. Goodwill and intangible assets
determined to have an indefinite useful life acquired in a purchase business
combination completed after June 30, 2001, but before SFAS No. 142 is adopted in
full, are not amortized. Goodwill and intangible assets acquired in business
combinations completed before July 1, 2001, continued to be amortized and be
tested for impairment prior to the full adoption of SFAS No. 142.

     Upon adoption of SFAS No. 142, the Company is required to evaluate its
existing intangible assets and goodwill that were acquired in purchase business
combinations, and to make any necessary reclassifications in order to conform
with the new classification criteria in SFAS No. 141 for recognition separate
from goodwill. The Company will be required to reassess the useful lives and
residual values of all intangible assets acquired, and make any necessary
amortization period adjustments by the end of the first interim period after
adoption. If an intangible asset is identified as having an indefinite useful
life, the Company will be required to test the intangible asset for impairment
in accordance with the provisions of SFAS No. 142 within the first interim
period. Impairment is measured as the excess of carrying value over the fair
value of intangible asset with an indefinite life. Any impairment loss will be
measured as of the date of adoption and recognized as the cumulative effect of a
change in accounting principle in the first interim period. Based on current
market conditions, which could change in the future, management currently
expects that these impairment tests will not have a material impact on the
Company's consolidated financial position or results from operations.

     As of January 1, 2002 the Company has unamortized goodwill in the amount of
$72.1 million and unamortized identifiable intangible assets in the amount of
$5.5 million, all of which will be subject to the transition provisions of SFAS
No. 142. Amortization expense related to goodwill was $2.4 million, and $2.1
million for the years ended December 31, 2001, and 2000, respectively.

     In August 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets" (SFAS No. 144). SFAS No. 144
addresses financial accounting and reporting for the impairment or disposal of
long-lived assets. This Statement requires that long-lived assets be reviewed
for impairment whenever events or changes in circumstances indicate that the
carrying amount of an asset may not be recoverable. If the carrying amount of an
asset exceeds its estimated future cash flows, an impairment charge is
recognized by the amount by which the carrying amount exceeds the fair value of
the asset. SFAS No. 144 requires companies to separately report discontinued
operations and extends that reporting to a component of an entity that either
has been disposed of (by sale, abandonment, or in a distribution to owners) or
is classified as held for sale. Assets to be disposed of are reported at the
lower of the carrying amount or fair value less costs to sell. The Company is
required to adopt SFAS No. 144 on January 1, 2002.

                                       F-11

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

3A. SFAS NO. 142 UPDATE (UNAUDITED)

     Amortization expense related to goodwill was $0 and $612,000 for the three
months ended March 31, 2002 and 2001, respectively. The Company has reviewed
goodwill for impairment under SFAS No. 142, and these tests indicate that no
impairment currently exists but no assurance can be given that impairment will
not exist in the future.

     The following table shows what net income would have been had SFAS No. 142
been applied in the comparable prior year period:



                                                              FOR THE THREE MONTHS
                                                                 ENDED MARCH 31,
                                                              ---------------------
                                                                2002        2001
                                                              --------    ---------
                                                                   (UNAUDITED)
                                                                 (IN THOUSANDS)
                                                                    
Net income (loss) as reported...............................   $1,657      $(6,751)
Add back: goodwill amortization.............................       --          612
                                                               ------      -------
Adjusted net income (loss)..................................   $1,657      $(6,139)
                                                               ======      =======


4. IMPAIRMENT OF LONG-LIVED ASSETS AND LOSS ON DISPOSAL OF ASSETS

     In response to the implementation of Medicare Prospective Payment System
(PPS), increased litigation and insurance costs in certain states, and increased
operational costs resulting from changes in legislation and regulatory scrutiny,
over the past several years the Company has focused on the divestiture of
under-performing nursing and assisted living facilities and the divestiture of
non-core health care assets.

     The following summarizes the components of the loss from asset impairment,
disposals and other items.



                                                        2001
                                           -------------------------------
                                           PROCEEDS
                                            NET OF                             2000       1999
                                           SELLING     NET BOOK               -------    -------
                                            COSTS       VALUE       LOSS       LOSS       LOSS
                                           --------    --------    -------    -------    -------
                                                              (IN THOUSANDS)
                                                                          
Loss from dispositions:
  Nursing and assisted living
     facilities..........................  $11,296     $11,296     $    --    $ 3,134    $38,279
                                           =======     =======
  Provision for closure and loss on disposals of facilities....     12,996      3,274      4,495
  Provision for adverse development of general and professional
     liability costs...........................................     10,964         --         --
  Other........................................................        286        255         --
                                                                   -------    -------    -------
  Loss on disposal of assets and other items...................     24,246      6,663     42,774
                                                                   -------    -------    -------
  Loss on impairment of long-lived assets......................      1,685     20,753     38,173
                                                                   -------    -------    -------
  Total Loss...................................................    $25,931    $27,416    $80,947
                                                                   =======    =======    =======


     The following reconciles the loss from asset impairment, disposals and
other items to that reported in the cash flow statements. The provision for
general and professional liability costs is removed as it is already reflected
in the line item provision for self-insured liabilities as an item not involving
cash.

                                       F-12

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)



                                                                2001       2000        1999
                                                              --------    -------    --------
                                                                      (IN THOUSANDS)
                                                                            
Reconciliation of loss to cash flow statements:
  Loss from asset impairment, disposals and other items.....  $ 25,931    $27,416    $ 80,947
  Provision for general and professional liability costs....   (10,964)        --          --
  Current taxes related to dispositions.....................        --         --     (29,000)
                                                              --------    -------    --------
  Loss on disposal and impairment per cash flow statement...  $ 14,967    $27,416    $ 51,947
                                                              ========    =======    ========
  Loss on disposal..........................................  $ 13,282    $ 6,663    $ 13,774
  Loss on impairment........................................     1,685     20,753      38,173
                                                              --------    -------    --------
  Total per cash flow statement.............................  $ 14,967    $27,416    $ 51,947
                                                              ========    =======    ========




                                                               2001       2000      1999
                                                              -------    ------    -------
                                                                     (IN THOUSANDS)
                                                                          
Reconciliation of cash proceeds from dispositions:
  Proceeds, net of selling costs............................  $11,296    $8,517    $56,222
  Cash held in escrow.......................................       --        --     (3,700)
  Notes receivable..........................................   (1,793)     (875)    (4,000)
  Preferred shares..........................................   (1,904)       --         --
                                                              -------    ------    -------
  Proceeds from sale of assets in cash flow.................  $ 7,599    $7,642    $48,522
                                                              =======    ======    =======


  Impairment of Long-Lived Assets

     The Company records impairment losses recognized for long-lived assets used
in operations when indicators of impairment are present and the estimated
undiscounted future cash flows do not appear to be sufficient to recover the
assets' carrying amounts. The impairment loss is measured by comparing the fair
value of the asset to its carrying amount. In addition, once management has
committed the organization to a plan for disposal, assets held for disposal are
adjusted to the lower of the assets' carrying value and the fair value less
costs to sell. Accordingly, management has estimated the future cash flows of
each facility and reduced the carrying value to the estimated fair value, where
appropriate.

     In September 2001 the Company made a formal decision to divest of its
nursing facilities (but not assisted living facilities) in Texas and completed a
transaction through which the Company ceased operating these facilities. This
transaction resulted in the Company leasing all four owned facilities and
subleasing the remaining 13 nursing facilities to a third party operator. As a
result of the transaction, the Company recorded a provision of $1.7 million for
impairment of these remaining Texas properties of which all related to leasehold
rights and leasehold improvements on the facilities. Refer to discussion in
"Loss on Disposal of Assets and Other Items".

     In December 2000 the Company made a formal decision to divest of all
remaining operations in Florida and completed two transactions through which the
Company leased all of its remaining operations. Both transactions resulted in
providing two operators with a first right to purchase the properties within the
lease term. The Company recorded a provision of $15.9 million for impairment of
these remaining Florida properties which included a provision of $1.1 million
for costs related to the termination of its Florida operational staff. In
addition, in December 2000, the Company determined that a $4.8 million
adjustment was required for non-Florida properties, resulting in a total
impairment provision for 2000 (including Florida) of $20.7 million applicable to
goodwill, property and equipment, of which $2.0 million related to goodwill.

                                       F-13

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     In the fourth quarter of 1999, management recorded an aggregate provision
for impairment of goodwill, property and equipment of $38.2 million, of which
$25.5 million related to goodwill. Of this provision, all but $3.9 million
related to facilities or assets located in Florida.

  Loss on Disposal of Assets and Other Items

     A loss of $24.2 million was recorded in 2001 for the disposition or closure
of facilities and settlements of previously sold operations as discussed below.
In September 2001, the Company transferred all nursing facilities in Texas to
Senior Health Properties-Texas, Inc. ("Senior Health-Texas") resulting in a
pre-tax loss of $1.8 million. In addition, the Company recorded provisions
totaling $2.0 million relating to the closure and/or sale of three nursing
properties. The Company made additional provisions of $20.2 million relating to
previously sold operations, of which $19.0 million relates to the nursing
facilities in Florida. Based on an actuarial review of resident care liability
costs, the Company has recorded an $11.0 million provision related to Florida
claims for years prior to 2001.

     In September 2001, the Company transferred the operations of all its Texas
nursing facilities to Senior Health-Texas. The transaction involved 17 skilled
nursing facilities, with a capacity of 1,421 residents, of which 13 facilities
are subleased and the remainder leased on a five-year term from the Company.
Senior Health-Texas will operate the subleased facilities for their remaining
lease terms, one of which expired in October 2001, and the remainder expiring
through February 2012. In November 2001, the landlord of the subleased nursing
facility for which the lease term expired in October 2001 assumed operational
responsibility for the facility and the Company is currently providing
consulting services to the landlord. The annual rental income from Senior
Health-Texas is approximately $3.8 million per annum, or $1.8 million in excess
of the Company's current annual lease costs, and will escalate in alignment to
the existing lease and in alignment with Medicaid rate increases for the owned
facilities. Senior Health-Texas has the right to first refusal on the purchase
of the four owned facilities.

     In April 2001, the Company completed the sale of two leased nursing
properties in Florida, with capacity for 240 residents, for gross proceeds of
$11.4 million. The buyer was Tandem Health Care, Inc. ("Tandem") which had
operated the facilities under a lease agreement with a purchase option. Proceeds
consisted of cash of $7.0 million, a $2.5 million interest-bearing five-year
note and $1.9 million in cumulative dividend preferred shares, mandatorily
redeemable after five years. The Company's carrying value of the two facilities
was $9.2 million. Tandem continues to operate seven nursing facilities under a
lease agreement with the Company, with an option to purchase these facilities at
any time during the lease term. The gain on sale of $2.1 million has been
deferred in accordance with FASB Statement No. 66, "Accounting for Sale of Real
Estate," when a significant portion of the proceeds has not been received and
the ultimate determination of the gain is dependent on Tandem exercising all
remaining options. The Company applied $4.0 million of the net cash proceeds to
further reduce its term bank debt.

     In 2000, the Company was successful in the disposition or lease of all of
its operations in Florida consisting of 32 facilities (3,427 beds) through a
series of transactions, two of which involved lease agreements with operators
who have an option to purchase the properties, and one in which the Company
retains an interest in the properties through the contingent consideration terms
of the agreement. In addition, the Company sold two formerly closed facilities.
In aggregate these five transactions, along with other asset sales, resulted in
cash proceeds of $37.7 million, of which $33.1 million was applied to reduce
debt. The sale or lease of Florida facilities, associated costs in exiting
Florida, and the loss from the disposition of the two formerly closed facilities
resulted in a pre-tax loss of $4.0 million. In addition, the Company provided
$1.7 million for the closure of two nursing and one assisted living facilities
and $1.0 million for the disposition of other non-core assets. Total losses for
2000 resulting from the disposal of assets and other items totaled $6.7 million.

                                       F-14

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     In December 2000, the Company leased nine Florida nursing facilities (1,033
beds) to Tandem for an 18-month term. In April 2001, Tandem exercised its right
to acquire two of the facilities. Tandem has options to purchase the remaining
facilities at any time during the term of the leases for up to $37.0 million,
less related costs and other credits that may exist at the time the option is
exercised. In 2002, if Tandem holds the remaining leases to term, the Company
will receive rental fees of $3.5 million and incur associated costs in respect
of the leases of approximately $2.0 million. Refer to note 13.

     In December 2000, the Company leased six nursing facilities (585 beds) to
Senior Health Properties-South, Inc. ("Senior Health-South") for a 60-month
term. Under the terms of the transaction, Senior Health-South has an option to
purchase the properties for $10.7 million. The Company will earn rental income
based upon the net operating cash flow of the properties, which cannot exceed on
average $2.0 million per annum and has entered into a specific services
consulting agreement over the term of the lease with Senior Health-South. Under
the terms of transaction, the Company has retained a commitment to fund any cash
flow deficiencies for one of the six properties, which the Company anticipates
would not exceed $300,000 per annum. All operations and assets, other than the
land, building and equipment, were transferred to the lessees at the
commencement of the leases at no cost to the lessees. Refer to note 13.

     In December 2000, the Company sold one Florida nursing facility (120 beds)
for $3.8 million. Consideration was comprised of notes totaling $1.2 million
(before prepayment discounts) and $2.6 million in cash, of which $932,000 is
held in escrow for settlement for potential claims. The two promissory notes
contain certain prepayment discounts totaling $324,000, which the Company has
assumed will be exercised and therefore the sale resulted in a pre-tax loss of
$2.5 million. The Company applied the net proceeds from this transaction of $1.6
million to reduce debt. In December 2001, the Company sold the two promissory
notes for $825,000 in cash, which was held in escrow until January 2002.

     In September 2000, the Company disposed of eleven Florida nursing
facilities (1,435 beds) and four Florida assisted living facilities (135 units)
to Greystone Tribeca Acquisition L.L.C. ("Greystone") for initial cash proceeds
of $30.0 million and contingent consideration in the form of a series of
interest bearing notes, which have an aggregate potential value of up to $30.0
million plus interest. The notes have a maximum term of three and one half years
and may be retired at any time out of the proceeds from the sale or refinancing
of the facilities by Greystone. During the term of the notes, the Company
retains the right of first refusal and an option to repurchase the facilities in
March 2004, which if not accepted, will trigger repayment of the balance of the
notes. The option to repurchase, along with the significant portion of the sales
price being contingent, results in the disposition being accounted for as a
deferred sale in accordance with Statement of Financial Accounting Standards No.
66 (SFAS 66). There was no gain or loss recorded on the initial transaction, and
the Company will continue to depreciate the fixed assets on its records, which
as of December 31, 2001 had a net book value of $38.8 million and have been
classified under "Other Assets" as "Assets held under Divestiture Agreement".
The initial cash proceeds have been classified within "Other Long-term
Liabilities" in the balance sheet as "Deposits held under Divestiture
Agreement". Additional payments received, including interest, will increase the
deposits net of carrying costs paid. The Company applied the net after tax
proceeds from this transaction of $27.5 million to reduce debt.

     In July 2000, the Company sold one Florida nursing facility (119 beds) for
$2.8 million. The sale resulted in a pre-tax gain of $940,000. The Company
applied the net after tax proceeds from this transaction of $2.0 million to
reduce debt.

     In May and June, 2000 the Company sold two previously closed nursing
facilities for $2.0 million and $700,000 respectively resulting in pre-tax
losses of $453,000 and $1.1 million, respectively. In June and October 2000,
leases at two of the Company's nursing homes in Oregon (135 operational beds)
expired and were not renewed. Certain equipment assets of these Oregon homes
were sold for $168,000. In February 2000, the Company sold seven outpatient
therapy facilities resulting in a pre-tax loss of $71,000.
                                       F-15

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     In 1999, the Company sold nine nursing facilities, six of which were in
Florida, and its home health operation for $62.3 million resulting in a pre-tax
loss of $37.0 million and made a number of provisions for the closure of nursing
facilities, additional costs related to the sale of non-core assets, and
severance of non-essential personnel to result in an overall pre-tax loss of
$42.8 million. The Company applied the net after-tax proceeds from these
dispositions to reduce debt by approximately $44.8 million. Of the facilities
sold in 1999, six were through the sale of a subsidiary in the fourth quarter,
which resulted in a pre-tax loss of $35.9 million and a current tax benefit of
$29.0 million relating to the recovery of prior year's taxes. In two separate
transactions, the Company sold three nursing facilities resulting in a pre-tax
gain of $479,000. The Company also sold its home health operation in the fourth
quarter, which resulted in a loss of $1.6 million. In addition, the Company made
a provision of $3.2 million for the closure of two nursing facilities and two
other nursing facilities for which notice had been given not to renew the leases
upon their maturities in June 2000 and September 2000. For these latter two
facilities, the Company concluded operations as planned in 2000. A further
provision of $2.6 million was made in 1999 for additional reserves related to
the sale of non-core assets and severance of non-essential personnel.

5. PROPERTY AND EQUIPMENT

     Property and equipment and related accumulated depreciation and
amortization as of December 31 is as follows:



                                                                2001        2000
                                                              --------    --------
                                                                 (IN THOUSANDS)
                                                                    
Land and land improvements..................................  $ 44,788    $ 48,828
Buildings and improvements..................................   551,871     555,073
Furniture and equipment.....................................    78,226      88,315
Leasehold improvements......................................    12,229      18,280
Construction in progress....................................     1,335       5,506
                                                              --------    --------
Property and equipment before accumulated depreciation and
  amortization..............................................   688,449     716,002
Less accumulated depreciation and amortization..............   210,619     208,466
                                                              --------    --------
Total property and equipment................................  $477,830    $507,536
                                                              ========    ========


6. GOODWILL AND OTHER INTANGIBLE ASSETS

     Goodwill and other intangible assets consisted of the following at December
31:



                                                               2001       2000
                                                              -------    -------
                                                                (IN THOUSANDS)
                                                                   
Goodwill....................................................  $83,353    $83,353
Leasehold rights............................................   11,709     12,347
                                                              -------    -------
Total goodwill and intangible assets before accumulated
  amortization..............................................   95,062     95,700
Less accumulated amortization...............................   17,470     14,390
                                                              -------    -------
Goodwill, net...............................................  $77,592    $81,310
                                                              =======    =======


                                       F-16

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

7. OTHER ASSETS

     Other assets consisted of the following at December 31:



                                                                2001        2000
                                                              --------    --------
                                                                 (IN THOUSANDS)
                                                                    
Assets held under Divestiture Agreement (see note 4)........  $ 38,812    $ 41,564
Non-current accounts receivable from Medicare and Medicaid
  programs, less allowance of $15,419 in 2001 and 2000 (see
  Note 12)..................................................    36,410      37,215
Deferred financing costs, net...............................     8,314       9,740
Notes receivable............................................     6,926       4,875
Indemnification escrow......................................     3,700       3,700
Common shares held for investment...........................     3,110       2,704
Warrants held for investment................................     2,820       2,490
Preferred shares held for investment........................     1,904          --
Security deposits...........................................     1,590       1,552
Debt service and capital expenditure trust funds............       943         902
Other.......................................................     2,901       3,472
                                                              --------    --------
                                                              $107,430    $108,214
                                                              ========    ========
Assets held under divestiture agreement:
  Land......................................................  $  3,083    $  3,083
  Building..................................................    55,527      55,519
  Furniture and equipment...................................     9,835      11,468
                                                              --------    --------
Assets held under divestiture agreement before accumulated
  depreciation and amortization.............................    68,445      70,070
                                                              --------    --------
Accumulated depreciation and amortization...................    29,633      28,506
                                                              --------    --------
Total assets held under divestiture agreement...............  $ 38,812    $ 41,564
                                                              ========    ========


     As of December 2001, the Company is pursuing settlement of a number of
outstanding Medicaid and Medicare receivables, with the long-term portion
included in other assets. For two specific issues totaling $22.1 million,
agreement has been reached with the Fiscal Intermediary ("FI"), that should
resolution not be made in early 2002, the matters will be reviewed through a
mediator between the FI and the Company prior to either party proceeding to the
Provider Reimbursement Review Board ("PRRB"). The two issues involve the
allocation of overhead costs and a staffing cost issue.

     Accumulated amortization of deferred financing costs as of December 31,
2001 and 2000 was $8.8 million and $6.7 million, respectively.

                                       F-17

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

8. LINE OF CREDIT AND LONG-TERM DEBT

     Long-term debt consisted of the following at December 31:



                                                                2001        2000
                                                              --------    --------
                                                                 (IN THOUSANDS)
                                                                    
Tranche A Term Loan.........................................  $ 12,681    $ 20,272
Tranche B Term Loan.........................................    60,730      63,494
Senior Subordinated Notes...................................   200,000     200,000
Revolving Credit Facility at variable interest rates........    63,000     115,000
Industrial Development Bonds, variable interest rates
  ranging from 1.70% to 6.25%, maturing through 2014,
  secured by certain facilities.............................    37,467      39,300
Promissory notes payable, interest rates ranging from 3.0%
  to 10.0%, maturing through 2008...........................     4,950       6,356
Mortgages, interest rates ranging from 7.25% to 13.61%
  maturing through 2010.....................................     6,458       6,651
Other, primarily capital lease obligations..................        61          74
                                                              --------    --------
Long-term debt before current maturities....................   385,347     451,147
Less current maturities.....................................    12,099      12,706
                                                              --------    --------
Total long-term debt........................................  $373,248    $438,441
                                                              ========    ========


     The Company entered into a syndicated bank credit agreement (the "Credit
Facility") dated November 26, 1997, which provided the Company with senior
secured credit facilities of up to $600 million. The Credit Facility consisted
of three term loans, each in the amount of $200 million, as follows: a six-year
revolving credit facility (the "Revolving Credit Facility"); a six-year term
loan (the "Tranche A Term Loan"); and a seven-year term loan (the "Tranche B
Term Loan"). Borrowings under the Credit Facility are secured by the outstanding
common shares and various assets of the Company and each of its existing and
future domestic subsidiaries. As a result of the decline in financial results,
amendments to the Company's Credit Facility in the second quarter of 1999
included revisions to the financial covenants, increased interest rates and
asset securitization. The Credit Facility was further amended in the first
quarter of 2000 for the 1999 general provision for Medicare settlements and
non-cash provisions for general and professional liability costs.

     On December 2, 1997, the Company issued $200 million of 9.35% Senior
Subordinated Notes due 2007 (the "Subordinated Notes"). The Subordinated Notes
are unsecured senior subordinated obligations of the Company subordinated in
right of payment to all existing and future senior indebtedness of the Company,
which includes all borrowings under the Credit Facility as well as all
indebtedness not refinanced by the Credit Facility. At December 31, 2001,
Extendicare Inc. and/or one of its wholly owned subsidiaries held $27.9 million
of the Senior Subordinated Notes.

     The Revolving Credit Facility matures on December 31, 2003, at which time
all outstanding borrowings are due. As part of the amendments to the Credit
Facility, the Company waived its right to $25 million of the Revolving Credit
Facility. The unused portion of the Revolving Credit Facility at December 31,
2001, was $74.3 million (net of letters of credit of $37.7 million and the $25.0
million unavailable portion), which is available for working capital and general
corporate purposes. The Tranche A Term Loan matures on December 31, 2003 with
annual repayments of $6.6 million in 2002 and $6.1 million in 2003, payable in
quarterly installments. The Tranche B Term Loan matures on December 31, 2004
with annual repayments, payable in quarterly installments, of $1.0 million in
2002 and $.6 million in 2003 with the balance of $59.1 million due in 2004.

                                       F-18

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The Company incurred charges to earnings in 2001 and 2000 from the
write-off of unamortized debt issuance costs incurred in connection with the
reduction of Tranche A and Tranche B borrowings resulting from the recovery of
prior year taxes, and the sale of nursing facilities. Similarly, in 1999 the
Company incurred the write-off of unamortized debt issuance costs resulting from
proceeds of the sale of the home health operations and nine nursing facilities.
The extraordinary loss realized after income taxes totaled $45,000, $442,000 and
$342,000 in 2001, 2000 and 1999, respectively.

     The Revolving Credit Facility, the Tranche A Term Loan and the Tranche B
Term Loan bear interest at the Company's option at rates equal to the prime rate
or LIBOR, plus applicable margins, depending upon the Company's leverage ratios.
Applicable margins at December 31, 2001 under the Revolving Credit Facility and
Tranche A Term Loan were 1.50% for prime rate loans and 2.25% for LIBOR based
borrowings. The applicable margin at December 31, 2001 under the Tranche B Term
Loan was 2.25% for prime rate borrowings and 3.00% for LIBOR based borrowings.
The average interest rates outstanding for the Revolving Credit Facility,
Tranche A Term Loan and Tranche B Term Loan at December 31, 2001 were 4.41%,
5.16%, and 4.19%, respectively. The weighted average interest rates were 7.03%
and 9.17% for amounts outstanding on the Revolving Credit Facility during 2001
and 2000, respectively. The average interest rate at December 31, 2001 and 2000
for all outstanding debt was 6.92% and 8.67%, respectively. The Company pays a
commitment fee on the unused portion of the Credit Facility at an annual rate of
0.50%.

     The Company is party to two interest rate swap agreements to reduce the
impact of changes in interest rates on certain of its floating rate long-term
debt with two banks. The swaps effectively change the interest rates on $75
million of LIBOR-based borrowings under the Credit Facility to fixed rates
ranging from 5.53% to 5.74% (average of 5.67%), plus the applicable margins. One
swap agreement, with notional amount of $50 million matures on February 27, 2002
and the remaining agreement matures on February 27, 2003. The Company may be
exposed to credit loss in the event of non-performance by the banks under the
swap agreements but does not anticipate such non-performance.

     The Credit Facility contains a number of covenants, such as: restrictions
on the payment of dividends by the Company; redemption of the Company's common
stock and change of control, as defined, of the Company; as well as financial
covenants, including fixed charge coverage, debt leverage, and net worth ratios.
The Company is required to make mandatory prepayments of principal upon the
occurrence of certain events, such as certain asset sales and certain issuances
of securities. The Company is permitted to make voluntary prepayments at any
time. Such prepayments may, under certain conditions, reduce the amounts
available to be borrowed under the Credit Facility.

     The Company is in compliance with the financial covenants of its credit
facility as of December 31, 2001. The financial covenants under this credit
facility continue to become more stringent over the term of the facility. While
management has a strategy to remain in compliance, there can be no assurance
that the Company will meet future covenant requirements. The Company's available
bank lines can be affected by its ability to remain in compliance, or if not,
would depend upon management's ability to amend the covenants, or refinance the
debt.

                                       F-19

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The Revolving Credit Facility matures on December 31, 2003, at which time
all outstanding borrowings are due. The Tranche A Term Loan matures on December
31, 2003 and the Tranche B Term Loan matures on December 31, 2004, and are
payable in quarterly installments as follows:



                                                              TRANCHE A    TRANCHE B
                                                              ---------    ---------
                                                                  (IN THOUSANDS)
                                                                     
2002........................................................   $ 6,576      $   983
2003........................................................     6,105          629
2004........................................................        --       59,118
                                                               -------      -------
                                                               $12,681      $60,730
                                                               =======      =======


     The Senior Subordinated Notes are unsecured senior subordinated obligations
of the Company subordinated in right of payment to all existing and future
senior indebtedness of the Company, which includes all borrowings under the
Credit Facility as well as all indebtedness not refinanced by the Credit
Facility. The Senior Subordinated Notes mature on December 15, 2007. Interest on
the Senior Subordinated Notes is payable semi-annually.

     Principal payments on long-term debt due within the next five years and
thereafter are as follows (dollars in thousands):

                                                           
2002........................................................  $ 12,099
2003........................................................    70,597
2004........................................................    60,031
2005........................................................       920
2006........................................................       880
After 2006..................................................   240,820
                                                              --------
                                                              $385,347
                                                              ========



     Interest paid in 2001, 2000 and 1999 was $35.5 million, $47.2 million and
$49.5 million, respectively.

9. ACCRUED LIABILITIES

     Accrued liabilities consisted of the following at December 31:



                                                               2001       2000
                                                              -------    -------
                                                                (IN THOUSANDS)
                                                                   
Salaries and wages, fringe benefits and payroll taxes.......  $34,791    $35,635
Workers' compensation and other claims......................   10,677     15,908
Medicaid reserves...........................................    8,046      7,935
Real estate, utilities and other taxes......................    6,070      7,741
Interest....................................................    2,700      2,773
Reserves for divested operations and facility closures......    8,002      3,514
Other.......................................................   12,450     11,868
                                                              -------    -------
                                                              $82,736    $85,374
                                                              =======    =======


10. ACCRUAL FOR SELF-INSURED LIABILITIES

     The Company insures certain risks with affiliated insurance subsidiaries of
Extendicare, and certain third-party insurers. The insurance policies cover
comprehensive general and professional liability, property coverage, workers'
compensation and employer's liability insurance in amounts and with such
coverage and

                                       F-20

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

deductibles as the Company deems appropriate, based on the nature and risks of
its business, historical experiences and industry standards. The Company also
self-insures for health and dental claims, in certain states for workers'
compensation and employer's liability and from January 2000, for general and
professional liability claims. Self-insured liabilities with respect to general
and professional liability claims are included within the Accrual for
Self-Insured Liabilities. The Company's accrual for self-insured health and
dental claims, and workers' compensation are included within note 9.

     Management regularly evaluates the appropriateness of the carrying value of
the self-insured liability through an independent actuarial review. Of the risks
for which the Company self-insures, general and professional liability claims
are the most volatile and significant. Management's estimate of the accrual for
general and professional liability costs is significantly influenced by
assumptions, which are limited by the uncertainty of predictions concerning
future events, and assessments regarding expectations of several factors. Such
factors include, but are not limited to: the frequency and severity of claims,
which can differ materially by jurisdiction in which the Company operates;
coverage limits of third-party reinsurance; the effectiveness of the claims
management process; and uncertainty regarding the outcome of litigation.

     In 2000, the Company experienced adverse claims development resulting in an
increase in the accrual for self-insured liabilities. Consequently, as of
January 1, 2000 the Company's per claim retained risk increased significantly
for general and professional liability coverage mainly due to the level of risks
associated with Florida and Texas operations. In 2001, the Company no longer
operated nursing and assisted living facilities in Florida and as of October 1,
2001 ceased nursing operations in Texas, thereby reducing the level of exposure
to future potential litigation in these litigious states. However, as a result
of an increase in the frequency and severity of claims the Company recorded an
additional $11.0 million provision (refer to note 4) to increase its accrual for
resident care liability in the third quarter of 2001. This additional accrual
was based upon an independent actuarial review and was largely attributable to
potential claims for incidents in Florida and Texas prior to the Company's
cessation of operations in those states. Changes in the Company's level of
retained risk, and other significant assumptions that underlie management's
estimates of self-insured liabilities, could have a material effect on the
future carrying value of the self-insured liabilities as well as the Company's
operating results and liquidity.

11. OTHER LONG-TERM LIABILITIES

     Other long-term liabilities consisted of the following at December 31:



                                                               2001       2000
                                                              -------    -------
                                                                (IN THOUSANDS)
                                                                   
Deposits held under Divestiture Agreement (see note 4)......  $30,000    $30,000
Deferred compensation.......................................    5,487      5,686
Indemnification escrow relating to sold facilities..........    3,700      3,700
Other.......................................................    4,831      1,330
                                                              -------    -------
Total other long-term liabilities...........................  $44,018    $40,716
                                                              =======    =======


     As noted in note 4, the Company disposed of eleven Florida nursing
facilities (1,435 beds) and four Florida assisted living facilities (135 units)
to Greystone for initial cash proceeds of $30.0 million and contingent
consideration in the form of a series of interest bearing notes which have an
aggregate potential value of up to $30.0 million plus interest. The disposition
is being accounted for as a deferred sale in accordance with SFAS 66 and
therefore, the initial cash proceeds have been classified as "Deposits held
under the Divestiture Agreement". Greystone has not sold or refinanced the
properties and therefore has not triggered the determination and payment of the
contingent notes.

                                       F-21

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The Company maintains an unfunded deferred compensation plan offered to all
corporate employees defined as highly compensated by the Internal Revenue
Service Code in which participants may defer up to 10% of their base salary. The
Company will match up to 50% of the amount deferred. The Company also maintains
non-qualified deferred compensation plans covering certain executive employees.
Expense incurred for Company contributions under such plans were $278,000,
$91,000 and $565,000 in 2001, 2000 and 1999, respectively.

     The Company maintains defined contribution retirement 401(k) savings plans,
which are made available to substantially all of the Company's employees. The
Company pays a matching contribution of 17% to 25% of every qualifying dollar
contributed by plan participants, net of any forfeitures. Expenses incurred by
the Company related to the 401(k) savings plans were $1.3 million, $1.4 million
and $1.0 million in 2001, 2000 and 1999, respectively. The Company also
maintains a money purchase plan for three facilities in which the Company pays
amounts based upon the plan participants worked hours and an agreed fixed hourly
rate. Expenses incurred by the Company related to the money purchase plan were
$54,000, $65,000 and $45,000 in 2001, 2000 and 1999, respectively.

12. REVENUES

     The Company derived approximately 24%, 24% and 22% of its revenues from
services provided under various federal (Medicare) and approximately 51%, 51%
and 50% of its revenues from services provided under various state (Medicaid)
medical assistance programs in 2001, 2000 and 1999, respectively. The Medicare
program and most state Medicaid programs pay each participating facility on a
prospectively-set per diem rate for each resident, which is based on the
resident's acuity. Most Medicaid programs fund participating facilities using a
case-mix system, paying prospectively set rates. Prior to 1999, the Medicare
program was a cost-based reimbursement program.

  a) Balanced Budget Act and the Prospective Payment System

     The Balanced Budget Act ("BBA"), signed into law in August 1997, made
numerous changes to the Medicare and Medicaid programs. With respect to the
Medicare program, the BBA established a Prospective Payment System (PPS) for
skilled nursing facility funding certified under the Medicare program. All of
the Company's skilled nursing facilities were funded under the provisions of the
BBA during 1999 and 2000. The PPS establishes a Federal per diem rate for
virtually all covered services and the provisions of the BBA provided that for
skilled nursing facilities in operation prior to 1996, the federal per diem rate
would be phased in over a four-year period. In November 1999, the Balanced
Budget Relief Act ("BBRA") was passed to allow each skilled nursing facility to
apply to adopt the full federal rate effective January 1, 2000 or to continue to
phase in to the federal rate over the next three years. An evaluation was
completed by the management of the Company, to determine the skilled nursing
facilities that would benefit from adoption of the full federal rate, and where
appropriate the Company applied and later received approval to have these
facilities placed on the full federal rate. Effective January 2002, all skilled
nursing facilities are reimbursed at the full federal rate.

     With respect to the Medicaid program, the BBA repealed the federal payment
standard which required state Medicaid programs to pay rates that were
reasonable and adequate to meet the costs necessary to efficiently and
economically operate skilled nursing facilities. As a result, states have
considerable flexibility in establishing payment rates for Medicaid services
provided after October 1, 1997.

  b) Balanced Budget Refinement Act of 1999 ("BBRA") and Benefits Improvement
     and Protection Act of 2000 ("BIPA")

     As a result of the industry coming under financial pressure due to the
implementation of PPS and other BBA of 1997 provisions, Congress passed two acts
to provide some relief to the industry, namely the
                                       F-22

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

BBRA of 1999 and the BIPA of 2000. These laws contained additional funding
provisions to assist providers as they adjusted to PPS for an interim period.
The BBRA of 1999 increased the rate by 20% for 15 Resource Utilization Groups
III ("RUGs") categories identified as having intensity non-therapy ancillary
services deemed to be underfunded. The BBRA of 1999 also provided for a 4%
increase to all RUGs categories on October 1, 2000. The BIPA of 2000 increased
the nursing component of the federal rate by 16.66% and replaced the 20% add-on
to the three RUGs categories with a 6.7% add-on for all 14 rehabilitative RUGs
categories. As outlined in Note 19, certain funding enhancements contained
within the BBRA of 1999 and BIPA of 2000 are scheduled to sunset on September
30, 2002 and others may not continue, subject to a rebasing of RUGs categories
by The Centers for Medicare and Medicaid Services ("CMS," formerly the Health
Care Financing Administration, or HCFA). CMS is the government agency that
administers the Medicare program and, at the present time CMS has made no formal
announcements regarding the timing or methodology of any RUGs refinements. Nor
has the Congress of the United States made a formal announcement on the
extension of the BBRA of 1999 or BIPA of 2000 funding beyond the expiration.

  c) Provision (Recovery) for Outstanding Medicare Receivable

     In the normal course of business, the Company has ongoing discussions with
its FI regarding the treatment of various items related to prior years' cost
reports. Normally items are resolved during the audit process and no provisions
are required. For items involving differences of opinion between the Company and
the FI regarding cost report methods, such items can be settled through a formal
appeal process. Should this occur, a general provision for Medicare receivables
may be provided for disagreements, which result in the provider filing an appeal
with the Provider Reimbursement Review Board (PRRB) of the CMS.

     During 1999, the FI notified the Company of several adjustments for
services rendered from 1995 through 1998. In the fourth quarter of 1999, the
Company made a decision to file a formal appeal to the PRRB and based upon this
decision, a general provision of $27.4 million was recorded as a reduction of
revenues in 1999. In April 2000, the PRRB heard the Company's first appeal
involving the reimbursement of workers' compensation costs and during September
2000, issued a decision that supported the Company's position. In December 2000,
the Administrator for CMS confirmed the PRRB's decision resulting in a favorable
settlement of $12.4 million, including a recovery recorded in revenue of $10.3
million of the general provision recorded in 1999. In addition, the Company
reached a settlement on another staffing cost issue resulting in a recovery of
$2.4 million including a recovery of $1.7 million of the general provision
recorded in 1999. In total, a recovery of $12.0 million before tax was recorded
in 2000 relating to the general provision recorded in 1999.

     Other adjustments relating to prior years' estimated settlements, including
Medicare waiver requests set out above, increased revenues by $1.9 million in
1999.

  d) Accounts receivable

     The Company had approximately 25%, 30% and 29% as of December 31, 2001,
2000 and 1999, respectively, in accounts receivable derived from services
provided under various federal (Medicare) programs and 38%, 36% and 34% as of
the same dates derived from services provided under various state (Medicaid)
medical assistance programs. The differences between revenues derived under
third-party payor programs and amounts received as payments are reflected as
accounts receivable when revenue is greater than payments received or as accrued
liabilities when payments have exceeded revenues that the Company ultimately
expects to be realized. Accounts receivable at December 31, 2001 and 2000, which
are expected to be substantially collected within one year, include estimated
settlements from third-party payors of $11.8 million and $15.6 million,
respectively.

                                       F-23

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

13. LEASE COMMITMENTS

     As a lessee, the Company, at December 31, 2001, was committed under
non-cancelable operating leases requiring future minimum rentals as follows
(dollars in thousands):

                                                           
2002........................................................  $12,169
2003........................................................    9,397
2004........................................................    8,987
2005........................................................    8,865
2006........................................................    6,325
After 2006..................................................   33,208
                                                              -------
Total minimum payments......................................  $78,951
                                                              =======



     Operating lease costs were $14.6 million, $18.0 million and $18.8 million
in 2001, 2000 and 1999, respectively. These leases expire on various dates
extending to the year 2013 and in many cases contain renewal options.

     As a lessor, at December 31, 2001 the Company leases 17 nursing properties
(1,862 beds) to three unrelated operators in Florida and in Texas under the
terms outlined in note 4. The Company will record future revenues as operating
leases and all operators have an option to purchase the facilities during the
term. The lease of seven nursing properties in Florida to Tandem expires in June
2002 and the current annual rental income is $7.0 million. The lease of six
nursing properties to Senior Health-South expires in December 2005, and the
Company earns rental income (based upon the net operating cash flow of the
properties) which on average cannot exceed $2.0 million per annum. Rental income
earned during 2001 totaled $467,000. Senior Health-Texas leases four nursing
properties for a term which expires in October 2006, and subleases another 12
properties until February 2012, all in Texas. The annual rental income is $3.8
million or $1.8 million in excess of the Company's annual lease cost. The cost
and accumulated depreciation of facilities under operating lease arrangements
included in Property and Equipment (refer to note 5) as of December 31, 2001 is
as follows:



                                                              (IN THOUSANDS)
                                                           
Land and land improvements..................................     $10,910
Buildings and improvements..................................      50,677
Furniture and equipment.....................................      15,072
                                                                 -------
Total property and equipment before accumulated depreciation
  and amortization..........................................      76,659
Less accumulated depreciation and amortization..............      32,374
                                                                 -------
Total property and equipment, net...........................     $44,285
                                                                 =======


14. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

  Objectives and Strategies

     The Company uses variable-rate long-term debt to finance its operations.
These debt obligations expose the Company to variability in interest payments
due to changes in interest rates. If interest rates increase, interest expense
increases. Conversely, if interest rates decrease, interest expense also
decreases.

     Management believes that it is prudent to limit the variability of a
portion of its interest payments and therefore hedges a portion of total
variable-rate debt. To meet this objective, management has entered into interest
rate swaps. These swaps change the variable-rate cash flow exposure on
variable-rate long-term debt to fixed-rate cash flows. Under the interest rate
swaps, the Company receives variable interest rate payments and makes fixed
interest rate payments.

                                       F-24

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The Company does not enter into derivative instruments for any purpose
other than cash flow hedging purposes. The Company does not speculate using
derivative instruments.

  Risk Management Policies

     The Company assesses interest rate cash flow risk by continually
identifying and monitoring changes in interest rate exposures that may adversely
impact expected future cash flows and by evaluating hedging opportunities. The
Company maintains risk management control systems to monitor interest rate cash
flow risk attributable to both the Company's outstanding or forecasted debt
obligations as well as the Company's offsetting hedge positions. The risk
management control systems involve the use of analytical techniques, including
cash flow sensitivity analysis, to estimate the expected impact of changes in
interest rates on the Company's future cash flows.

  Quantitative Disclosures as of and for Quarter Ended March 31, 2002

     As of March 31, 2002, the Company has an interest rate swap (used to hedge
variable-rate cash flow exposure on variable-rate long-term debt) with a
notional amount of $25 million maturing in February 2003. Interest expense for
the three months ended March 31, 2002 includes $7,000 in net gains representing
the cash flow hedge's ineffectiveness arising from differences between the terms
of the interest rate swap and the hedged debt obligation.

     Changes in the fair value of interest rate swaps designated as hedging
instruments of the variability of cash flows associated with floating-rate,
long-term debt obligations are reported as Accumulated Other Comprehensive
Income ("AOCI") as a component of Shareholder's Equity. These amounts are
subsequently reclassified into interest expense as a yield adjustment in the
same period in which the related interest on the floating-rate debt obligations
affects earnings.

     As of March 31, 2002, the fair value of the interest rate swap designated
as hedging instruments is a liability recorded in other long-term liabilities of
$0.7 million and the gain charged to AOCI (net of income tax effect) for the
three months ended March 31, 2002 was $0.6 million. During the year ending
December 31, 2002, approximately $0.7 million of losses in AOCI (net of income
tax effect) related to the interest rate swaps are expected to be reclassified
into interest expense as a yield adjustment of the hedged debt obligation.

  Quantitative Disclosures as of and for Years Ended December 31, 2001

     As of May 29, 2001, $25 million in interest rate swaps maturing February
27, 2003 were terminated in exchange for a cash payment of $0.5 million. This
amount will be amortized to interest expense over the remaining term of the
swap.

     As of December 31, 2001, the Company has interest rate swaps (used to hedge
variable-rate cash flow exposure on variable-rate long-term debt) with notional
amounts of $50 million maturing in February 2002 and $25 million maturing in
February 2003.

     Interest expense for 2001 includes $22,000 in net gains representing the
cash flow hedge's ineffectiveness arising from differences between the terms of
the interest rate swap and the hedged debt obligation.

     Changes in the fair value of interest rate swaps designated as hedging
instruments of the variability of cash flows associated with floating-rate,
long-term debt obligations are reported as AOCI as a component of Shareholder's
Equity. These amounts are subsequently reclassified into interest expense as a
yield adjustment in the same period in which the related interest on the
floating-rate debt obligations affects earnings.

                                       F-25

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The impact as of January 1, 2001 arising from the adoption of the standards
(relating to the fair value of interest rate swaps) was an increase of $0.2
million in other long-term liabilities and a decrease of $0.2 million in AOCI.

     As of December 31, 2001, the fair value of the interest rate swaps
designated as hedging instruments is a liability recorded in other long-term
liabilities of $1.4 million and the loss charged to AOCI (net of income tax
effect) for 2001 is $1.1 million.

     During the year ending December 31, 2002, approximately $1.0 million of
losses in AOCI (net of income tax effect) related to the interest rate swaps are
expected to be reclassified into interest expense as a yield adjustment of the
hedged debt obligation.

15. COMMITMENTS AND CONTINGENCIES

  Capital Expenditures

     The Company as of December 31, 2001 had capital expenditure purchase
commitments outstanding of approximately $5.4 million.

     At March 31, 2002, the Company had capital expenditure purchase commitments
outstanding of approximately $2.4 million (unaudited).

  Insurance

     The Company insures certain risks with affiliated insurance subsidiaries of
Extendicare. The cost of general and professional liability insurance premiums
was the most significant insurance expense charged to the Company by the
affiliates. In 2000 and 1999, the premiums charged to the Company for this
general and professional liability coverage increased significantly due to
adverse claims development experienced by the affiliates. Refer to note 9.

  Litigation

     The Company and its subsidiaries are defendants in actions brought against
them from time to time in connection with their operations. While it is not
possible to estimate the final outcome of the various proceedings at this time,
such actions generally are resolved within amounts provided.

     The U.S. Department of Justice and other Federal agencies are increasing
resources dedicated to regulatory investigations and compliance audits of
healthcare providers. The Company is diligent to these regulatory efforts.

  Omnicare Preferred Provider Agreement

     In 1998, the Company disposed of its pharmacy operations to Omnicare, Inc.
In addition, the Company entered into a Preferred Provider Agreement, the terms
of which enabled Omnicare to execute Pharmacy Service Agreements and Consulting
Service Agreements with all of the Company's skilled nursing facilities. Under
the terms of the agreement, the Company secured "per diem" pricing arrangements
for pharmacy supplies for the first four years of the Agreement, which period
expires December 2002. The Preferred Provider Agreement contains a number of
provisions which involve sophisticated calculations to determine the "per diem"
pricing during this first four-year period. Under the "per diem" pricing
arrangement, pharmacy costs fluctuate based upon occupancy levels in the
facilities. The "per diem" rates were established assuming a declining "per
diem" value over the initial four years of the contract to coincide with the
phase-in of the Medicare PPS rates. Omnicare has subsequently asserted

                                       F-26

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

that "per diem" rates for managed care and Medicare beneficiaries are subject to
an upward adjustment based upon a comparison of per diem rates to pricing models
based on Medicaid rates.

     In 2001, the Company and Omnicare brought two matters to arbitration,
neither of which involves material financial amounts. The first issue related to
select pricing issues in one state which was resolved by settlement between the
parties. The parties are in the process of resolving the remaining issue, which
is related to the legal interpretation of the Medicaid adjustment provisions,
and the impact of this provision on "per diem" pricing for managed care
residents during 2001 and 2002. Omnicare has indicated that it intends to make
similar claims for Medicare residents for a similar time period. Provisions for
settlement of the claims are included within the financial statements. The
Company believes it has interpreted and has complied with the terms of the
Preferred Provider Agreement; however, there can be no assurance that other
claims will not be made with respect to the agreement.

  Option to Purchase

     The Company exercised its right to purchase seven nursing facilities in
Ohio and Indiana prior to the expiration of the lease in September 2000. Since
this date, the Company continues to lease and operate the facilities in good
faith and has held on-going negotiations with the landlord to conclude issues
involved in completing the transaction. Negotiations have to date not resolved
all issues to complete the transaction and may require arbitration to conclude.
The Company believes it has complied fully with the terms of the option and
believes that settlement of outstanding issues can be resolved, however, there
is no assurance that the transaction will be completed. Should the matters be
resolved, approximately $6.4 million of the purchase price would be paid in
cash. As of December 31, 2001 the Company had $4.2 million in leasehold
improvements and equipment relating to these facilities.

  Contingent Consideration

     The Company received $30.0 million in initial cash proceeds and hold
contingent consideration in the form of a series of interest-bearing notes,
which have an aggregate potential value of up to $30.0 million plus interest.
Refer to note 4 for further details. As of December 31, 2001, Greystone has not
sold or refinanced any of the nursing properties and therefore has not triggered
the determination of the value of the notes and interest or payment of the
notes.

16. TRANSACTIONS WITH SHAREHOLDER AND AFFILIATES

     The following is a summary of the Company's transactions with Extendicare
and its affiliates in 2001, 2000 and 1999:

  Insurance

     The Company insures certain risks with affiliated insurance subsidiaries of
Extendicare. The cost of general and professional liability premiums was the
most significant insurance expense charged to the Company by the affiliates. In
2001, 2000 and 1999, the premiums charged to the Company for this general and
professional liability coverage increased significantly, due to the adverse
claims development experienced by the affiliates. The consolidated statements of
operations for 2001, 2000 and 1999 include intercompany insurance premium
expenses of $5.7 million, $20.7 million and $13.9 million, respectively. These
figures are net of favorable actuarial adjustments for prior years under its
retroactively-rated workers' compensation coverage in the amounts of $0.9
million, $1.3 million and $1.9 million in 2001, 2000 and 1999, respectively. As
noted within note 10, the Company's departure from the State of Florida and the
State of Texas will likely reduce future general and professional liability
coverage expenditures.

                                       F-27

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

  Computer Services

     In January 2001, the Company established a formal agreement for computer
hardware and software support services with an affiliated subsidiary of
Extendicare. The annual cost of services was $6.5 million and resulted in
savings to the Company of approximately $2.3 million in 2001.

  Leases

     In 1999, the Company entered into a capital lease relating to computer
equipment with an affiliated subsidiary of Extendicare. In the first quarter of
2000, the Company exercised its option to purchase the equipment for $1.3
million. The consolidated statement of operations includes interest expense of
$110,000 and $319,000 related to this lease for 2000 and 1999, respectively.

  Other Payables

     At December 31, 2001, 2000 and 1999 the Company had a non-interest bearing
payable with no specific due date to a subsidiary company of Extendicare of $3.5
million as of all dates.

  Due to Shareholders and Affiliates

     Transactions affecting these accounts were general and professional
liability insurance charges, accrued liability claims from an affiliate and
working capital advances to an affiliate in 2001, 2000 and 1999, and charges
(payments) from (to) shareholder and affiliates for income taxes in each of the
three years.

  Capital and Other Transactions

     During 2001 and 2000, Extendicare and/or one of its wholly owned
subsidiaries acquired $19.0 million and $8.9 million, respectively of the
Company's Senior Subordinated Notes. As of December 31, 2001, Extendicare and/or
one of its wholly owned subsidiaries held $27.9 million (14.0%) of the
outstanding Senior Subordinated Notes.

17. INCOME TAXES

     The Company's results of operations are included in the consolidated
federal tax return of its U.S. parent company. Accordingly, Federal current and
deferred income taxes payable are transferred to the Company's parent company.
The provisions for income taxes have been calculated as if the Company was a
separately taxed entity for each of the periods presented in the accompanying
consolidated financial statements.

     Total income taxes for the years ended December 31, 2001, 2000 and 1999
were allocated as follows:



                                                       2001        2000        1999
                                                     --------    --------    --------
                                                              (IN THOUSANDS)
                                                                    
Loss from continuing operations....................  $(12,482)   $(27,667)   $(52,841)
Extraordinary item.................................       (30)       (257)       (240)
Shareholders' equity for unrealized gain or (loss)
  on investments...................................       295         925      (2,185)
Unrealized loss on cash flow hedges................      (596)         --          --
                                                     --------    --------    --------
                                                     $(12,813)   $(26,999)   $(55,266)
                                                     ========    ========    ========


                                       F-28

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The income tax expense (benefit) on losses before extraordinary item
consists of the following for the year ended December 31:



                                                       2001        2000        1999
                                                     --------    --------    --------
                                                              (IN THOUSANDS)
                                                                    
Federal:
  Current..........................................  $     --    $(14,507)   $(42,729)
  Deferred.........................................   (13,193)    (12,184)     (9,225)
                                                     --------    --------    --------
Total Federal......................................   (13,193)    (26,691)    (51,954)
State:
  Current..........................................       544         294       2,736
  Deferred.........................................       167      (1,270)     (3,623)
                                                     --------    --------    --------
Total State........................................       711        (976)       (887)
                                                     --------    --------    --------
Total income tax benefit...........................  $(12,482)   $(27,667)   $(52,841)
                                                     ========    ========    ========


     The differences between the effective tax rates on earnings before
provision for income taxes and the United States Federal income tax rate are as
follows:



                                                              2001    2000    1999
                                                              ----    ----    ----
                                                                     
Statutory Federal income tax rate...........................  35.0%   35.0%   35.0%
Increase (reduction) in tax rate resulting from:
  State income taxes, net of Federal income tax benefit.....   0.8     0.8     0.4
  Goodwill and other items..................................  (2.9)   (1.5)   (1.5)
  Impairment of long-lived assets...........................    --      --    (6.8)
  Increase in valuation allowance...........................  (3.1)     --      --
  Recovery of prior year's taxes............................    --      --    19.1
  Work opportunity credit...................................   1.4     0.6     0.5
  Other, net................................................    --    (1.3)   (3.8)
                                                              ----    ----    ----
Effective tax rate..........................................  31.2%   33.6%   42.9%
                                                              ====    ====    ====


     The Company received payments of $22.5 and $47.3 million for federal income
taxes from its U.S. parent in 2001 and 2000, respectively. The Company made
payments of $24.5 million for federal income taxes to its U.S. parent in 1999.

                                       F-29

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The components of the net state deferred tax assets and liabilities as of
December 31 are as follows:



                                                               2001       2000
                                                              -------    -------
                                                                (IN THOUSANDS)
                                                                   
Deferred tax assets:
  Employee benefit accruals.................................  $ 1,473    $ 1,516
  Accrued liabilities.......................................    3,695      2,642
  Accounts receivable reserves..............................    1,310      1,819
  Operating loss carryforwards..............................    6,354      4,819
  Other assets..............................................    1,648      1,396
                                                              -------    -------
  Subtotal..................................................   14,480     12,192
  Valuation allowance.......................................    6,944      4,149
                                                              -------    -------
     Total deferred tax assets..............................    7,536      8,043
Deferred tax liabilities:
  Depreciation..............................................    5,777      6,239
  Goodwill..................................................      465        389
  Leasehold rights..........................................      285        349
  Miscellaneous.............................................    1,009        861
                                                              -------    -------
     Total deferred tax liabilities.........................    7,536      7,838
                                                              -------    -------
Net deferred tax assets.....................................  $    --    $   205
                                                              =======    =======


     The Company paid state income taxes of $326,000, $98,000 and $4.8 million
in 2001, 2000 and 1999, respectively. As of December 31, 2001 the Company had
$95.8 million of total net operating loss carry forwards available for state
income tax financial reporting purposes which expire from 2002 to 2021. Because
the realizability of these losses is uncertain, the operating loss carry
forwards are offset by a valuation allowance.

     The valuation allowance for state deferred tax assets as of December 31,
2001 and 2000 was $6.9 million and $4.1 million, respectively. The net change in
the total valuation allowance for the years ended December 31, 2001 and 2000 was
an increase of $2.8 million and an increase of $3.2 million, respectively. In
assessing the realizability of deferred tax assets, management considers whether
it is more likely than not that some portion or all of the deferred tax assets
will not be realized. The ultimate realization of deferred tax assets is
dependent upon the generation of future taxable income during the periods in
which those temporary differences become deductible. Management considers the
scheduled reversal of deferred tax liabilities, projected future taxable income,
and tax planning strategies in making this assessment. Management believes it is
more likely than not the Company will realize the benefits of these deductible
differences, net of the valuation allowances.

                                       F-30

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

18. COMPREHENSIVE INCOME

     The accumulated balances for each classification of comprehensive income
are as follows:



                                                  UNREALIZED                   ACCUMULATED
                                                     GAINS                        OTHER
                                                  (LOSSES) ON    CASH FLOW    COMPREHENSIVE
                                                  SECURITIES      HEDGES         INCOME
                                                  -----------    ---------    -------------
                                                                     
Balance at December 31, 1998....................    $   187       $    --        $   187
Net current period change.......................     (3,277)                      (3,277)
                                                    -------       -------        -------
Balance at December 31, 1999....................     (3,090)           --         (3,090)
Net current period change.......................      1,387                        1,387
                                                    -------       -------        -------
Balance at December 31, 2000....................     (1,703)           --         (1,703)
Cumulative effect of change in accounting for
  hedging activities............................         --          (913)          (913)
Net current period change.......................        441          (192)           249
                                                    -------       -------        -------
Balance at December 31, 2001....................    $(1,262)      $(1,105)       $(2,367)
                                                    =======       =======        =======


     The related tax effects allocated to each component of other comprehensive
income are as follows:



                                                                      TAX
                                                     BEFORE-TAX    (EXPENSE)     NET-OF-TAX
                                                       AMOUNT      OR BENEFIT      AMOUNT
                                                     ----------    ----------    ----------
                                                                        
Unrealized gains (losses) on securities:
Unrealized holding gains (losses) arising during
  the period.......................................   $   736        $(295)       $   441
                                                      -------        -----        -------
Cash flow hedges:
Cumulative effect of a change in accounting for
  derivative instruments and hedging activities....    (1,405)         492           (913)
Net derivative gains (losses)......................      (296)         104           (192)
                                                      -------        -----        -------
Net current period change..........................    (1,701)         596         (1,105)
                                                      -------        -----        -------
Other comprehensive income (loss)..................   $  (965)       $ 301        $  (664)
                                                      =======        =====        =======


19. UNCERTAINTIES AND CERTAIN SIGNIFICANT RISKS

     The Company's earnings are highly contingent on Medicare and Medicaid
funding rates, and the effective management of staffing and other costs of
operations which are strictly monitored through State and Federal regulatory
authorities. The Company is unable to predict whether the federal or any state
government will adopt changes in their reimbursement systems, or if adopted and
implemented, what effect such initiatives would have on the Company. Limitations
on Medicare and Medicaid reimbursement for health care services are continually
proposed. Changes in applicable laws and regulations could have an adverse
effect on the levels of reimbursement from governmental, private and other
sources.

     As outlined in Note 12(b), the incremental Medicare relief packages
received from BBRA and BIPA provide a total $2.7 billion in temporary Medicare
funding enhancements to the long-term care industry. The funding enhancements
implemented by the BBRA and BIPA fall into two categories. The first category is
"Legislative Add-ons" which included the 16.66% add-on to the nursing component
of the RUGs rate and the 4% base adjustment. The Legislative Add-ons are
currently scheduled to sunset on September 30, 2002. Currently, no legislation
has been introduced in the United States Congress, nor have recommendations been
made by CMS to continue this funding. The second category is "RUGs Refinements"
which involved an initial 20% add-on for 15 RUGs categories identified as having
high

                                       F-31

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

intensity, non-therapy ancillary services (later redistributed the 20% add-ons
from 3 RUGs categories to 14 Rehab categories at 6.7%). The RUGs Refinements
continue until such time as CMS refines the RUGs categories. The Company has
estimated the average per diem effect of the Legislative Add-ons to be $31.00
and RUGs Refinements to be $25.00. The amount of incremental Medicare funding
related to the Legislative Add-ons and RUGs Refinements is estimated to be $16.0
million and $13.0 million, respectively. A decision to discontinue all or part
of the enhancement could have a significant impact on the Company.

     Through the divestiture program in Texas and Florida, the Company has
assumed notes and preferred shares from the purchasers and retained ownership of
certain nursing home properties. In aggregate, as of December 31, 2001, the
Company has $8.8 million in notes and preferred shares and owns $44.3 million in
nursing home properties in Texas and Florida. In 2001, the Company earned $5.3
million in annual management and consulting fees from unrelated long-term
operators. As a result, the earnings and cash flow of the Company can be
influenced by the financial stability of these unrelated long-term operators.

     The Company has $70.3 million in accruals for self-insured liabilities as
of December 31, 2001. Though the Company has been successful in exiting from the
two litigious states of Texas and Florida and limiting future exposure to
general liability claims in these states, the timing and eventual settlement
costs for these claims cannot be precisely defined.

     The Company has a high level of indebtedness with debt service obligations
totaling $385.3 million in borrowings at December 31, 2001 representing 63.4% of
total capitalization, compared to a similar ratio of 64.0% at December 31, 2000.
As a result, the degree to which the Company is leveraged could have important
consequences, including, but not limited to the following:

          1. A substantial portion of the Company's cash flow from operations
     would be dedicated to the payment of principal and interest on the
     Company's indebtedness, thereby reducing the funds available for other
     purposes;

          2. The Company's ability to obtain additional financing within its
     current Credit Facility for working capital, capital expenditures,
     acquisitions or other purposes may be limited;

          3. Certain of the Company's borrowings are at variable rates of
     interest, which exposes the Company to the risk of higher interest rates.

     The Company expects to satisfy the required payments of principal and
interest on indebtedness from cash flow from operations. However, the Company's
ability to generate sufficient cash flows from operations depends on a number of
internal and external factors, including factors beyond the Company's control
such as prevailing industry conditions. There can be no assurances that cash
flow from operations will be sufficient to enable the Company to service its
debt and meet other obligations.

     The Company is in compliance with the financial covenants of its Credit
Facility as of December 31, 2001. The financial covenants under this credit
facility continue to become more stringent over the term of the facility. While
management has a strategy to remain in compliance, there can be no assurance
that the Company will meet future covenant requirements. The Company's available
bank lines can be affected by its ability to remain in compliance, or if not,
would depend upon management's ability to amend the covenant or refinance the
debt.

19A. SUBSEQUENT DEVELOPMENT (UNAUDITED)

     On April 23, 2002, the CMS announced that it would delay the implementation
of the RUGS Refinements, thereby extending the related add-ons for at least one
additional government fiscal year.

                                       F-32

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

20. DISCLOSURES ABOUT FAIR VALUES OF FINANCIAL INSTRUMENTS

     The estimated fair values of the Company's financial instruments at
December 31 are as follows:



                                                           2001                      2000
                                                  ----------------------    ----------------------
                                                  CARRYING    ESTIMATED     CARRYING    ESTIMATED
                                                   VALUE      FAIR VALUE     VALUE      FAIR VALUE
                                                  --------    ----------    --------    ----------
                                                                   (IN THOUSANDS)
                                                                            
Non-current accounts receivable.................  $ 36,410     $ 35,173     $ 37,215     $ 34,644
Other assets....................................    21,575       21,575       17,213       17,213
Interest rate swaps (liability).................     1,403        1,403           --          216
Long-term debt..................................   385,347      383,902      451,147      461,710
Deferred compensation...........................     5,487        5,487        5,686        5,686
Other long-term liabilities.....................     4,831        4,831        1,330        1,330
Long-term due to affiliate......................     3,484        3,484        3,484        3,484


     The carrying values of accounts receivable approximate fair values due to
their short maturities with the exception of certain settlement receivables from
third-party payors which are anticipated to be collected beyond one year. The
fair value of these settlement receivables are estimated based on discounted
cash flows at management's estimated current borrowing rates.

     Other assets consist of debt service and capital expenditure trust funds
and other financial instruments, the fair values of which are estimated based on
market prices from the same or similar issues of the underlying investments.

     The fair value of the interest rate swaps from various financial
institutions is based on the quoted market prices as provided by the financial
institutions which are counter-parties to the swaps.

     The fair value of long-term debt is estimated based on approximate
borrowing rates currently available to the Company for debt equal to the
existing debt maturities. For other long-term liabilities, principally
refundable escrows, it is not practicable to estimate fair value.

                                       F-33

                       EXTENDICARE HEALTH SERVICES, INC.

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

21. SUPPLEMENTARY QUARTERLY FINANCIAL DATA (UNAUDITED)

     The following is a summary of the quarterly results of operations for the
years ended December 31, 2001 and 2000 (in thousands):



                                                                2001
                                      --------------------------------------------------------
                                        1ST         2ND         3RD         4TH        TOTAL
                                      --------    --------    --------    --------    --------
                                                                       
Total revenues......................  $193,432    $200,789    $204,025    $195,861    $794,107
                                      ========    ========    ========    ========    ========
Loss on impairment of long-lived
  assets............................  $     --    $     --    $ (1,685)   $     --    $ (1,685)
Loss on disposal of assets and other
  items.............................    (1,409)     (6,435)    (16,402)         --     (24,246)
Earnings (loss) before provision for
  income taxes and extraordinary
  items.............................   (10,430)    (10,897)    (23,338)      4,733     (39,932)
Provision (benefit) for income
  taxes.............................    (3,679)     (2,198)     (9,249)      2,644     (12,482)
                                      --------    --------    --------    --------    --------
Earnings (loss) before extraordinary
  items.............................    (6,751)     (8,699)    (14,089)      2,089     (27,450)
Extraordinary items.................        --         (45)         --          --         (45)
                                      --------    --------    --------    --------    --------
Net earnings (loss).................  $ (6,751)   $ (8,744)   $(14,089)   $  2,089    $(27,495)
                                      ========    ========    ========    ========    ========




                                                                2000
                                      --------------------------------------------------------
                                        1ST         2ND         3RD         4TH        TOTAL
                                      --------    --------    --------    --------    --------
                                                                       
Total revenues......................  $227,890    $232,119    $230,110    $232,950    $923,069
                                      ========    ========    ========    ========    ========
Loss on impairment of long-lived
  assets............................  $     --    $     --    $     --    $(20,753)   $(20,753)
Gain (loss) on disposal of assets
  and other items...................      (195)     (1,531)        940      (5,877)     (6,663)
Loss before provision for income
  taxes and extraordinary items.....   (16,445)    (11,775)    (21,534)    (32,592)    (82,346)
Benefit for income taxes............    (5,923)     (3,892)     (7,786)    (10,066)    (27,667)
                                      --------    --------    --------    --------    --------
Loss before extraordinary items.....   (10,522)     (7,883)    (13,748)    (22,526)    (54,679)
Extraordinary items.................        --          --        (436)         (6)       (442)
                                      --------    --------    --------    --------    --------
Net loss............................  $(10,522)   $ (7,883)   $(14,184)   $(22,532)   $(55,121)
                                      ========    ========    ========    ========    ========


                                       F-34


                                  $150,000,000

                    [Extendicare Health Services, Inc. Logo]

                       EXTENDICARE HEALTH SERVICES, INC.

                            New 9 1/2% Senior Notes
                                    due 2010

                              -------------------

                                   PROSPECTUS

                              -------------------

                                          , 2002




                                     PART II

                     INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 20.   INDEMNIFICATION OF DIRECTORS AND OFFICERS.

          Pursuant to the provisions of Section 145 of the Delaware General
Corporation Law, Extendicare Health Services, Inc. (the "Company") is required
to indemnify any present or former officer or director against expenses
reasonably incurred by the officer or director in connection with legal
proceedings in which the officer or director becomes involved by reason of being
an officer or director if the officer or director is successful in the defense
of such proceedings. Section 145 also provides that the Company may indemnify an
officer or director in connection with a proceeding in which he or she is not
successful in defending if it is determined that the officer or director acted
in good faith and in a manner reasonably believed to be in or not opposed to the
best interests of the Company or, in the case of a criminal action, if it is
determined that the officer or director had no reasonable cause to believe his
or her conduct was unlawful. Liabilities for which an officer or director may be
indemnified include amounts paid in satisfaction of settlements, judgments,
fines and other expenses incurred in connection with such proceedings. In a
stockholder derivative action, no indemnification may be paid in respect of any
claim, issue or matter as to which the officer or director has been adjudged to
be liable to the Company (except for expenses allowed by a court).

          Pursuant to the provisions of Article VIII of the Company's By-Laws,
the Company is required to indemnify officers or directors to a greater extent
than under the current provisions of Section 145 of the Delaware General
Corporation Law. Except with respect to stockholder derivative actions, the
Company's By-Laws generally state that an officer or director will be
indemnified against expenses, judgements, fines and amounts paid in settlement
reasonably incurred by the officer or director in connection with any
threatened, pending or completed proceeding, provided that (i) such officer or
director acted in good faith and in a manner he reasonably believed to be in or
not opposed to the best interests of the Company; and (ii) with respect to
criminal actions, such officer or director had no reasonable cause to believe
his conduct was unlawful. With respect to stockholder derivative actions, the
Company's By-Laws generally state that an officer or director will be
indemnified against expenses reasonably incurred by the officer or director in
connection with the defense or settlement of any threatened, pending or
completed action or suit provided that such officer or director acted in good
faith and in a manner he reasonably believed to be in or not opposed to the best
interests of the Company, except that no indemnification (except for
indemnification allowed by a court) will be made with respect to any claim,
issue or matter as to which such officer or director has been adjudged to be
liable to the Company and its stockholders. The Company's By-Laws also provide
that expenses for the defense of any action for which indemnification may be
available will be advanced by the Company under certain circumstances.

          Additionally, pursuant to the Company's Restated Certificate of
Incorporation, a director is not personally liable to the Company or any of its
stockholders for monetary damages for breach of his or her fiduciary duty as a
director, except for liability resulting from (i) any breach of the director's
duty of loyalty to the Company or its stockholders; (ii) acts or omissions not
in good faith or which involve intentional misconduct or knowing violation of
law; (iii) violation of Section 174 of the Delaware General Corporation Law,
which generally hold directors liable for unlawful dividends, stock purchases or
stock redemptions in the event of the Company's dissolution or insolvency; or
(iv) any transaction from which the director derived an improper personal
benefit.

         The indemnification provided by the Delaware General Corporation Law
and the Company's Restated Certificate or Incorporation and By-Laws is not
exclusive of any other rights to which a director or officer of the Company may
be entitled. The Company also carries directors' and officers' liability
insurance.

         The laws of the states or other jurisdictions of incorporation or
organization and/or the provisions of the articles or certificates of
incorporation or organization (or their equivalent) and the bylaws of
substantially all of the

                                      II-1




subsidiary guarantors listed in the "Table of Additional Registrants" (the
"Subsidiary Guarantors") included in this Registration Statement provide
indemnification provisions similar to those described above.

         The Exchange and Registration Rights Agreement contains provisions
under which the holders of the notes agree to indemnify the officers, directors
and controlling persons of the Company and each of the Subsidiary Guarantors
against certain liabilities, including liabilities under the Securities Act of
1933 or to contribute to payments the officers and directors may be required to
make with respect to such liabilities.

ITEM 21.   EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

         (a) Exhibits. The exhibits listed in the accompanying Exhibit Index are
filed (except where otherwise indicated) as part of this Registration Statement.

         (b) Financial Statement Schedules. Schedule II -- Valuation and
Qualifying Accounts and the related Independent Auditors' Report are filed
herewith as Exhibit 99.1. All other schedules are omitted because they are not
applicable or not required, or because the required information is shown either
in the consolidated financial statements or in the notes thereto.

         (c) Reports, Opinions or Appraisals. Not applicable.

ITEM 22.   UNDERTAKINGS.

         (a) Each of the undersigned Registrants hereby undertakes:

                  (1) To file, during any period in which offers or sales are
         being made, a post-effective amendment to this Registration Statement:

                           (i) To include any prospectus required by Section
                  10(a)(3) of the Securities Act of 1933;

                           (ii) To reflect in the prospectus any facts or events
                  arising after the effective date of the Registration Statement
                  (or the most recent post-effective amendment thereof) which,
                  individually or in the aggregate, represent a fundamental
                  change in the information set forth in the Registration
                  Statement. Notwithstanding the foregoing, any increase or
                  decrease in volume of securities offered (if the total dollar
                  value of securities offered would not exceed that which was
                  registered) and any deviation from the low or high end of the
                  estimated maximum offering range may be reflected in the form
                  of prospectus filed with the Commission pursuant to Rule
                  424(b) if, in the aggregate, the changes in volume and price
                  represent no more than a 20% change in the maximum aggregate
                  offering price set forth in the "Calculation of Registration
                  Fee" table in the effective Registration Statement;

                           (iii) To include any material information with
                  respect to the plan of distribution not previously disclosed
                  in the Registration Statement or any material change to such
                  information in the Registration Statement.

                  (2) That, for the purpose of determining any liability under
         the Securities Act of 1933, each such post-effective amendment shall be
         deemed to be a new Registration Statement relating to the securities
         offered therein, and the offering of such securities at that time shall
         be deemed to be the initial bona fide offering thereof.

                  (3) To remove from registration by means of a post-effective
         amendment any of the securities being registered which remain unsold at
         the termination of the offering.

         (b) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrants pursuant to the foregoing provisions, or otherwise,
the


                                      II-2




Registrants have been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act of 1933 and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by a
Registrant of expenses incurred or paid by a director, officer or controlling
person of a Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, each of the Registrants will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.

         (c) Each of the undersigned Registrants hereby undertakes to respond to
requests for information that is incorporated by reference into the Prospectus
pursuant to Item 4, 10(b), 11 or 13 of this form, within one business day of
receipt of such request, and to send the incorporated documents by first class
mail or other equally prompt means. This includes information contained in
documents filed subsequent to the effective date of the Registration Statement
through the date of responding to the request.

         (d) Each of the undersigned Registrants hereby undertakes to supply by
means of a post-effective amendment all information concerning a transaction,
and the company being acquired involved therein, that was not the subject of and
included in the Registration Statement when it became effective.



                                      II-3


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         EXTENDICARE HEALTH SERVICES, INC.


                                         By:      /s/ Melvin A. Rhinelander
                                              ---------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                  Date
              ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director (Principal
Melvin A. Rhinelander                       Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director





                                      S-1

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         ADULT SERVICES UNLIMITED, INC.


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                  Date
              ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director (Principal
Melvin A. Rhinelander                       Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director





                                      S-2

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         ARBORS AT TOLEDO, INC.


                                         By:     /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                  Date
              ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director (Principal
Melvin A. Rhinelander                       Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director





                                      S-3

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         ARBORS EAST, INC.


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                  Date
              ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director (Principal
Melvin A. Rhinelander                       Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director




                                      S-4

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         COVENTRY CARE HOLDINGS, INC.


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                  Date
              ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director (Principal
Melvin A. Rhinelander                       Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director




                                      S-5

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         COVENTRY CARE, INC.


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                  Signature                                    Title                               Date
                  ---------                                    -----                               ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director (Principal
Melvin A. Rhinelander                       Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director





                                      S-6

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         EDGEWOOD NURSING CENTER, INC.


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                 Date
                ---------                                    -----                                 ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director (Principal
Melvin A. Rhinelander                       Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director



                                      S-7

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         ELDER CREST, INC.


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                  Date
              ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director (Principal
Melvin A. Rhinelander                       Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director





                                      S-8

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         EXTENDICARE GREAT TRAIL, INC.


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                  Date
              ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director (Principal
Melvin A. Rhinelander                       Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)


/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director





                                      S-9

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         EXTENDICARE HEALTH FACILITIES, INC.


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer

                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                  Date
              ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director (Principal
Melvin A. Rhinelander                       Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director





                                      S-10

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         EXTENDICARE HEALTH FACILITY HOLDINGS,
                                         INC.


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                    Date
              ---------                                    -----                                    ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director (Principal
Melvin A. Rhinelander                       Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director





                                      S-11

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         EXTENDICARE HEALTH NETWORK, INC.


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                   Date
              ---------                                    -----                                   ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director (Principal
Melvin A. Rhinelander                       Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director





                                      S-12



                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         EXTENDICARE HOMES, INC.


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer

                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                    Date
              ---------                                    -----                                    ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director (Principal
Melvin A. Rhinelander                       Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director





                                      S-13


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         EXTENDICARE OF INDIANA, INC.


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                   Date
              ---------                                    -----                                   ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director (Principal
Melvin A. Rhinelander                       Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director



                                      S-14



                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                      FIR LANE TERRACE CONVALESCENT CENTER, INC.



                                      By:      /s/ Melvin A. Rhinelander
                                           ----------------------------------
                                           Melvin A. Rhinelander
                                           Chairman of the Board and Chief
                                           Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                    Date
              ---------                                    -----                                    ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director (Principal
Melvin A. Rhinelander                       Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director




                                      S-15



                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                   HAVEN CREST, INC.


                                   By:      /s/ Melvin A. Rhinelander
                                        -----------------------------------
                                        Melvin A. Rhinelander
                                        Chairman of the Board and Chief
                                        Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.





       Signature                                    Title                                   Date
       ---------                                    -----                                   ----
                                                                                  
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                July 29, 2002
- ---------------------------                 Executive Officer and Director
Melvin A. Rhinelander                       (Principal Executive Officer)


/s/ Mark W. Durishan                        Vice President, Chief Financial             July 29, 2002
- ---------------------------                 Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic            July 29, 2002
- ---------------------------                 Planning and Investor Relations
Philip W. Small                             and Director




                                      S-16



                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                   HEALTH POCONOS, INC.


                                   By:      /s/ Melvin A. Rhinelander
                                        -----------------------------------
                                        Melvin A. Rhinelander
                                        Chairman of the Board and Chief
                                        Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.




       Signature                                    Title                                    Date
       ---------                                    -----                                    ----
                                                                                   
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                 July 29, 2002
- ---------------------------                 Executive Officer and Director
Melvin A. Rhinelander                       (Principal Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial              July 29, 2002
- ---------------------------                 Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic             July 29, 2002
- ---------------------------                 Planning and Investor Relations
Philip W. Small                             and Director




                                      S-17




                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                   MARSHALL PROPERTIES, INC.


                                   By:      /s/ Melvin A. Rhinelander
                                        -----------------------------------
                                        Melvin A. Rhinelander
                                        Chairman of the Board and Chief
                                        Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



         Signature                                    Title                                        Date
         ---------                                    -----                                        ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ---------------------------                 Executive Officer and Director
Melvin A. Rhinelander                       (Principal Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ---------------------------                 Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ---------------------------                 Planning and Investor Relations
Philip W. Small                             and Director





                                      S-18


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                   MEADOW CREST, INC.


                                   By:      /s/ Melvin A. Rhinelander
                                        ------------------------------------
                                        Melvin A. Rhinelander
                                        Chairman of the Board and Chief
                                        Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



        Signature                                    Title                                         Date
        ---------                                    -----                                         ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ---------------------------                 Executive Officer and Director
Melvin A. Rhinelander                       (Principal Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ---------------------------                 Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ---------------------------                 Planning and Investor Relations
Philip W. Small                             and Director






                                      S-19



                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                   NORTHERN HEALTH FACILITIES, INC.


                                   By:      /s/ Melvin A. Rhinelander
                                        -----------------------------------
                                        Melvin A. Rhinelander
                                        Chairman of the Board and Chief
                                        Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.





         Signature                                    Title                                        Date
         ---------                                    -----                                        ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ---------------------------                 Executive Officer and Director
Melvin A. Rhinelander                       (Principal Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ---------------------------                 Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ---------------------------                 Planning and Investor Relations
Philip W. Small                             and Director




                                      S-20


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                   OAK HILL HOME OF REST
                                   AND CARE, INC.


                                   By:      /s/ Melvin A. Rhinelander
                                        ----------------------------------------
                                        Melvin A. Rhinelander
                                        Chairman of the Board and Chief
                                        Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.




         Signature                                    Title                                        Date
         ---------                                    -----                                        ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ---------------------------                 Executive Officer and Director
Melvin A. Rhinelander                       (Principal Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ---------------------------                 Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ---------------------------                 Planning and Investor Relations
Philip W. Small                             and Director




                                      S-21


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                     THE PROGRESSIVE STEP CORPORATION


                                     By:      /s/ Melvin A. Rhinelander
                                          -----------------------------------
                                          Melvin A. Rhinelander
                                          Chairman of the Board and Chief
                                          Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.





         Signature                                    Title                                        Date
         ---------                                    -----                                        ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ---------------------------                 Executive Officer and Director
Melvin A. Rhinelander                       (Principal Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ---------------------------                 Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ---------------------------                 Planning and Investor Relations
Philip W. Small                             and Director





                                      S-22


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                      UNITED PROFESSIONAL SERVICES, INC.


                                      By:      /s/ Melvin A. Rhinelander
                                           ----------------------------------
                                           Melvin A. Rhinelander
                                           Chairman of the Board and Chief
                                           Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



         Signature                                    Title                                        Date
         ---------                                    -----                                        ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       (Principal Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director




                                      S-23

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                    ARBORS AT BAYONET POINT, LLC

                                    By:  NORTHERN HEALTH FACILITIES, INC.,
                                         AS SOLE MEMBER


                                    By:      /s/ Melvin A. Rhinelander
                                         ---------------------------------------
                                         Melvin A. Rhinelander
                                         Chairman of the Board and Chief
                                         Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



          Signature                                    Title                                       Date
          ---------                                    -----                                       ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Northern Health Facilities,
                                            Inc. (Principal Executive
                                            Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Northern Health Facilities,
                                            Inc. (Principal Financial Officer
                                            and Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Northern Health
                                            Facilities, Inc.




                                      S-24


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                    ARBORS AT FAIRLAWN CARE, LLC

                                    By:  NORTHERN HEALTH FACILITIES, INC.,
                                         AS SOLE MEMBER


                                    By:       /s/ Melvin A. Rhinelander
                                         ---------------------------------------
                                         Melvin A. Rhinelander
                                         Chairman of the Board and Chief
                                         Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



           Signature                                    Title                                      Date
           ---------                                    -----                                      ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Northern Health Facilities,
                                            Inc. (Principal Executive
                                            Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Northern Health Facilities,
                                            Inc. (Principal Financial Officer
                                            and Principal Accounting
                                            Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Northern Health
                                            Facilities, Inc.




                                      S-25


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                    ARBORS AT FAIRLAWN REALTY OH, LLC

                                    By:  NORTHERN HEALTH FACILITIES, INC.,
                                         AS SOLE MEMBER


                                    By:        /s/ Melvin A. Rhinelander
                                         ---------------------------------------
                                         Melvin A. Rhinelander
                                         Chairman of the Board and Chief
                                         Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



         Signature                                    Title                                         Date
         ---------                                    -----                                         ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Northern Health Facilities,
                                            Inc. (Principal Executive
                                            Officer)


/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Northern Health Facilities,
                                            Inc. (Principal Financial Officer
                                            and Principal Accounting
                                            Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Northern Health
                                            Facilities, Inc.





                                      S-26


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                    ARBORS AT SYLVANIA CARE, LLC

                                    By:  NORTHERN HEALTH FACILITIES, INC.,
                                         AS SOLE MEMBER


                                    By:        /s/ Melvin A. Rhinelander
                                         ---------------------------------------
                                         Melvin A. Rhinelander
                                         Chairman of the Board and Chief
                                         Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



           Signature                                    Title                                       Date
           ---------                                    -----                                       ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Northern Health Facilities,
                                            Inc. (Principal Executive
                                            Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Northern Health Facilities,
                                            Inc. (Principal Financial Officer
                                            and Principal Accounting
                                            Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Northern Health
                                            Facilities, Inc.





                                      S-27


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                    ARBORS AT SYLVANIA REALTY OH, LLC

                                    By:  NORTHERN HEALTH FACILITIES, INC.,
                                         AS SOLE MEMBER


                                    By:      /s/ Melvin A. Rhinelander
                                         ---------------------------------------
                                         Melvin A. Rhinelander
                                         Chairman of the Board and Chief
                                         Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



           Signature                                    Title                                      Date
           ---------                                    -----                                      ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Northern Health Facilities,
                                            Inc. (Principal Executive
                                            Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Northern Health Facilities,
                                            Inc. (Principal Financial Officer
                                            and Principal Accounting
                                            Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Northern Health
                                            Facilities, Inc.




                                      S-28


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                    ARBORS AT TAMPA, LLC

                                    By:  NORTHERN HEALTH FACILITIES, INC.,
                                         AS SOLE MEMBER


                                    By:        /s/ Melvin A. Rhinelander
                                         ---------------------------------------
                                         Melvin A. Rhinelander
                                         Chairman of the Board and Chief
                                         Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



          Signature                                    Title                                       Date
          ---------                                    -----                                       ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Northern Health Facilities,
                                            Inc. (Principal Executive
                                            Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Northern Health Facilities,
                                            Inc. (Principal Financial Officer
                                            and Principal Accounting
                                            Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Northern Health
                                            Facilities, Inc.




                                      S-29

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         ARBORS WEST CARE, LLC

                                         By:  NORTHERN HEALTH FACILITIES, INC.,
                                              AS SOLE MEMBER


                                         By:    /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                  Date
              ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.




                                      S-30

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         ARBORS WEST REALTY OH, LLC

                                         By:  NORTHERN HEALTH FACILITIES, INC.,
                                              AS SOLE MEMBER


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                  Date
              ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.





                                      S-31

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         BLANCHESTER CARE, LLC

                                         By:  NORTHERN HEALTH FACILITIES, INC.,
                                              AS SOLE MEMBER


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                  Date
              ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.





                                      S-32

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         CANTON CARE, LLC

                                         By:  NORTHERN HEALTH FACILITIES, INC.,
                                              AS SOLE MEMBER


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                  Date
              ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.





                                      S-33

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         COLUMBUS REHABILITATION CARE, LLC

                                         By:  NORTHERN HEALTH FACILITIES, INC.,
                                              AS SOLE MEMBER


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                  Date
              ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.




                                      S-34

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         COLUMBUS REHABILITATION REALTY OH, LLC

                                         By:  NORTHERN HEALTH FACILITIES, INC.,
                                              AS SOLE MEMBER


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                  Date
              ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.






                                      S-35

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         DAYTON CARE, LLC

                                         By:  NORTHERN HEALTH FACILITIES, INC.,
                                              AS SOLE MEMBER


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                  Date
              ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.





                                      S-36

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         DELAWARE CARE, LLC

                                         By:  NORTHERN HEALTH FACILITIES, INC.,
                                              AS SOLE MEMBER


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                  Date
              ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.




                                      S-37

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         GALLIPOLIS CARE, LLC

                                         By:  NORTHERN HEALTH FACILITIES, INC.,
                                              AS SOLE MEMBER


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                  Date
              ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.





                                      S-38

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         HILLIARD CARE, LLC

                                         By:  NORTHERN HEALTH FACILITIES, INC.,
                                              AS SOLE MEMBER


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                  Date
              ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.




                                      S-39

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         JACKSONVILLE CARE, LLC

                                         By:  NORTHERN HEALTH FACILITIES, INC.,
                                              AS SOLE MEMBER


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                   Date
              ---------                                    -----                                   ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.




                                      S-40

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         KISSIMMEE CARE, LLC

                                         By:  NORTHERN HEALTH FACILITIES, INC.,
                                              AS SOLE MEMBER


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                   Date
              ---------                                    -----                                   ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.





                                      S-41

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         LONDON CARE, LLC

                                         By:  NORTHERN HEALTH FACILITIES, INC.,
                                              AS SOLE MEMBER


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                   Date
              ---------                                    -----                                   ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.






                                      S-42

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         MARIETTA CARE, LLC

                                         By:  NORTHERN HEALTH FACILITIES, INC.,
                                              AS SOLE MEMBER


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                   Date
              ---------                                    -----                                   ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.




                                      S-43

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         ORANGE PARK CARE, LLC

                                         By:  NORTHERN HEALTH FACILITIES, INC.,
                                              AS SOLE MEMBER


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



              Signature                                    Title                                   Date
              ---------                                    -----                                   ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.






                                      S-44

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                              OREGON CARE, LLC

                              By:  NORTHERN HEALTH FACILITIES, INC.,
                                   AS SOLE MEMBER


                              By:      /s/ Melvin A. Rhinelander
                                   -----------------------------------------
                                   Melvin A. Rhinelander
                                   Chairman of the Board and Chief
                                   Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                 Date
                ---------                                    -----                                 ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.




                                      S-45

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                               PORT CHARLOTTE CARE, LLC

                               By:  NORTHERN HEALTH FACILITIES, INC.,
                                    AS SOLE MEMBER


                               By:      /s/ Melvin A. Rhinelander
                                    ----------------------------------------
                                    Melvin A. Rhinelander
                                    Chairman of the Board and Chief
                                    Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.




                                      S-46

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                 ROCKMILL CARE, LLC

                                 By:  NORTHERN HEALTH FACILITIES, INC.,
                                      AS SOLE MEMBER


                                 By:      /s/ Melvin A. Rhinelander
                                      ------------------------------------------
                                      Melvin A. Rhinelander
                                      Chairman of the Board and Chief
                                      Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.




                                      S-47

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.


                                         ROCKSPRINGS CARE, LLC

                                         By:  NORTHERN HEALTH FACILITIES, INC.,
                                              AS SOLE MEMBER


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.




                                      S-48

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                              SAFETY HARBOR CARE, LLC

                              By:  NORTHERN HEALTH FACILITIES, INC.,
                                   AS SOLE MEMBER


                              By:      /s/ Melvin A. Rhinelander
                                   ------------------------------------------
                                   Melvin A. Rhinelander
                                   Chairman of the Board and Chief
                                   Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.




                                      S-49

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         SARASOTA CARE, LLC

                                         By:  NORTHERN HEALTH FACILITIES, INC.,
                                              AS SOLE MEMBER


                                         By:      /s/ Melvin A. Rhinelander
                                              ----------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                          
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.




                                      S-50

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                  SEMINOLE CARE, LLC

                                  By:  NORTHERN HEALTH FACILITIES, INC.,
                                       AS SOLE MEMBER


                                  By:      /s/ Melvin A. Rhinelander
                                       -----------------------------------------
                                       Melvin A. Rhinelander
                                       Chairman of the Board and Chief
                                       Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.




                                      S-51

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                WATERVILLE CARE, LLC

                                By:  NORTHERN HEALTH FACILITIES, INC.,
                                     AS SOLE MEMBER


                                By:      /s/ Melvin A. Rhinelander
                                     -----------------------------------------
                                     Melvin A. Rhinelander
                                     Chairman of the Board and Chief
                                     Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.




                                      S-52

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                 WINTER HAVEN CARE, LLC

                                 By:  NORTHERN HEALTH FACILITIES, INC.,
                                      AS SOLE MEMBER


                                 By:      /s/ Melvin A. Rhinelander
                                      -----------------------------------------
                                      Melvin A. Rhinelander
                                      Chairman of the Board and Chief
                                      Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----

                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.




                                      S-53


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                  WOODSFIELD CARE, LLC

                                  By:  NORTHERN HEALTH FACILITIES, INC.,
                                       AS SOLE MEMBER


                                  By:      /s/ Melvin A. Rhinelander
                                       -----------------------------------------
                                       Melvin A. Rhinelander
                                       Chairman of the Board and Chief
                                       Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Northern
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Northern Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Northern Health
                                            Facilities, Inc.




                                      S-54

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                 ALPINE HEALTH AND REHABILITATION CENTER, LLC

                                 By:  EXTENDICARE HEALTH FACILITIES,
                                      INC., AS SOLE MEMBER


                                 By:      /s/ Melvin A. Rhinelander
                                      -----------------------------------------
                                      Melvin A. Rhinelander
                                      Chairman of the Board and Chief
                                      Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- -----------------------------------         Officer and Director of Extendicare
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Extendicare Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Extendicare Health
                                            Facilities, Inc.




                                      S-55


                                   SIGNATURES


                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                 COLONIAL CARE, LLC

                                 By:  EXTENDICARE HEALTH FACILITIES,
                                      INC., AS SOLE MEMBER


                                 By:      /s/ Melvin A. Rhinelander
                                      ----------------------------------------
                                      Melvin A. Rhinelander
                                      Chairman of the Board and Chief
                                      Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Extendicare
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Extendicare Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Extendicare Health
                                            Facilities, Inc.




                                      S-56


                                   SIGNATURES


                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                 GREENBRIAR CARE, LLC

                                 By:  EXTENDICARE HEALTH FACILITIES,
                                      INC., AS SOLE MEMBER


                                 By:      /s/ Melvin A. Rhinelander
                                      -----------------------------------------
                                      Melvin A. Rhinelander
                                      Chairman of the Board and Chief
                                      Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Extendicare
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Extendicare Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Extendicare Health
                                            Facilities, Inc.




                                      S-57

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                GREENBROOK CARE, LLC

                                By:  EXTENDICARE HEALTH FACILITIES,
                                     INC., AS SOLE MEMBER


                                By:      /s/ Melvin A. Rhinelander
                                     ------------------------------------------
                                     Melvin A. Rhinelander
                                     Chairman of the Board and Chief
                                     Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Extendicare
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Extendicare Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Extendicare Health
                                            Facilities, Inc.




                                      S-58

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                HERITAGE CARE, LLC

                                By:  EXTENDICARE HEALTH FACILITIES,
                                     INC., AS SOLE MEMBER


                                By:      /s/ Melvin A. Rhinelander
                                     ------------------------------------------
                                     Melvin A. Rhinelander
                                     Chairman of the Board and Chief
                                     Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Extendicare
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Extendicare Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Extendicare Health
                                            Facilities, Inc.





                                      S-59

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                 LADY LAKE CARE, LLC

                                 By:  EXTENDICARE HEALTH FACILITIES,
                                      INC.,  AS SOLE MEMBER


                                 By:      /s/ Melvin A. Rhinelander
                                      ------------------------------------------
                                      Melvin A. Rhinelander
                                      Chairman of the Board and Chief
                                      Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Extendicare
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Extendicare Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Extendicare Health
                                            Facilities, Inc.




                                      S-60

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                NEW HORIZON CARE, LLC

                                By:  EXTENDICARE HEALTH FACILITIES,
                                     INC., AS SOLE MEMBER


                                By:      /s/ Melvin A. Rhinelander
                                     ------------------------------------------
                                     Melvin A. Rhinelander
                                     Chairman of the Board and Chief
                                     Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Extendicare
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Extendicare Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Extendicare Health
                                            Facilities, Inc.




                                      S-61

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                 NORTH REHABILITATION CARE, LLC

                                 By:  EXTENDICARE HEALTH FACILITIES,
                                      INC., AS SOLE MEMBER


                                 By:      /s/ Melvin A. Rhinelander
                                      ------------------------------------------
                                      Melvin A. Rhinelander
                                      Chairman of the Board and Chief
                                      Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2992
- ------------------------------------        Officer and Director of Extendicare
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2992
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Extendicare Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2992
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Extendicare Health
                                            Facilities, Inc.




                                      S-62

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                 PALM COURT CARE, LLC

                                 By:  EXTENDICARE HEALTH FACILITIES,
                                      INC., AS SOLE MEMBER


                                 By:      /s/ Melvin A. Rhinelander
                                      -----------------------------------------
                                      Melvin A. Rhinelander
                                      Chairman of the Board and Chief
                                      Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Extendicare
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Extendicare Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Extendicare Health
                                            Facilities, Inc.




                                      S-63

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2992.

                                 RICHEY MANOR, LLC

                                 By:  EXTENDICARE HEALTH FACILITIES,
                                      INC., AS SOLE MEMBER


                                 By:      /s/ Melvin A. Rhinelander
                                      -----------------------------------------
                                      Melvin A. Rhinelander
                                      Chairman of the Board and Chief
                                      Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Extendicare
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Extendicare Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Extendicare Health
                                            Facilities, Inc.




                                      S-64

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                  ROCKLEDGE CARE, LLC

                                  By:  EXTENDICARE HEALTH FACILITIES,
                                       INC., AS SOLE MEMBER


                                  By:      /s/ Melvin A. Rhinelander
                                       -----------------------------------------
                                       Melvin A. Rhinelander
                                       Chairman of the Board and Chief
                                       Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Extendicare
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Extendicare Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Extendicare Health
                                            Facilities, Inc.




                                      S-65

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.


                                  SOUTH HERITAGE HEALTH AND
                                  REHABILITATION CENTER, LLC

                                  By:  EXTENDICARE HEALTH FACILITIES,
                                       INC., AS SOLE MEMBER


                                  By:      /s/ Melvin A. Rhinelander
                                       -----------------------------------------
                                       Melvin A. Rhinelander
                                       Chairman of the Board and Chief
                                       Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Extendicare
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Extendicare Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Extendicare Health
                                            Facilities, Inc.




                                      S-66

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2992.

                                  THE OAKS RESIDENTIAL AND
                                  REHABILITATION CENTER, LLC

                                  By:  EXTENDICARE HEALTH FACILITIES,
                                       INC., AS SOLE MEMBER


                                  By:      /s/ Melvin A. Rhinelander
                                       -----------------------------------------
                                       Melvin A. Rhinelander
                                       Chairman of the Board and Chief
                                       Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2992
- ------------------------------------        Officer and Director of Extendicare
Melvin A. Rhinelander                       Health Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2992
- ------------------------------------        Officer, Treasurer and Director of
Mark W. Durishan                            Extendicare Health Facilities, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2992
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Extendicare Health
                                            Facilities, Inc.





                                      S-67

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                     WINTERHAVEN HEALTH AND
                                     REHABILITATION CENTER, LLC

                                     By:  EXTENDICARE HEALTH FACILITIES,
                                          INC., AS SOLE MEMBER


                                     By:      /s/ Melvin A. Rhinelander
                                          --------------------------------------
                                          Melvin A. Rhinelander
                                          Chairman of the Board and Chief
                                          Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



          Signature                                    Title                                       Date
          ---------                                    -----                                       ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Extendicare Health
                                            Facilities, Inc. (Principal
                                            Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Extendicare Health
                                            Facilities, Inc. (Principal
                                            Financial Officer and Principal
                                            Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Extendicare
                                            Health Facilities, Inc.




                                      S-68


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                     CONCORDIA MANOR, LLC

                                     By:  EXTENDICARE HOMES, INC.,
                                          AS SOLE MEMBER


                                     By:      /s/ Melvin A. Rhinelander
                                          -------------------------------------
                                          Melvin A. Rhinelander
                                          Chairman of the Board and Chief
                                          Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



         Signature                                    Title                                        Date
         ---------                                    -----                                        ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Extendicare Homes, Inc.
                                            (Principal Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Extendicare Homes, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Extendicare
                                            Homes, Inc.




                                      S-69


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                     FIRST COAST HEALTH AND
                                     REHABILITATION CENTER, LLC

                                     By:  EXTENDICARE HOMES, INC.,
                                          AS SOLE MEMBER


                                     By:      /s/ Melvin A. Rhinelander
                                          -------------------------------------
                                          Melvin A. Rhinelander
                                          Chairman of the Board and Chief
                                          Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



        Signature                                    Title                                     Date
        ---------                                    -----                                     ----
                                                                                     
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                   July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Extendicare Homes, Inc.
                                            (Principal Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Extendicare Homes, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic               July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Extendicare
                                            Homes, Inc.




                                      S-70


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                     JACKSON HEIGHTS REHABILITATION CENTER, LLC

                                     By:  EXTENDICARE HOMES, INC.,
                                          AS SOLE MEMBER


                                     By:      /s/ Melvin A. Rhinelander
                                          --------------------------------------
                                          Melvin A. Rhinelander
                                          Chairman of the Board and Chief
                                          Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



       Signature                                    Title                                    Date
       ---------                                    -----                                    ----
                                                                                   
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                 July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Extendicare Homes, Inc.
                                            (Principal Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial              July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Extendicare Homes, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic             July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Extendicare
                                            Homes, Inc.




                                      S-71


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                     TREASURE ISLE CARE CENTER, LLC

                                     By:  EXTENDICARE HOMES, INC.,
                                          AS SOLE MEMBER


                                     By:      /s/ Melvin A. Rhinelander
                                          -------------------------------------
                                          Melvin A. Rhinelander
                                          Chairman of the Board and Chief
                                          Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



           Signature                                    Title                                Date
           ---------                                    -----                                ----
                                                                                   
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                 July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Extendicare Homes, Inc.
                                            (Principal Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial              July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Extendicare Homes, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic             July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Extendicare
                                            Homes, Inc.




                                      S-72


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                     FISCAL SERVICES GROUP, LLC

                                     By:  EXTENDICARE HEALTH NETWORK, INC.,
                                          AS SOLE MEMBER


                                     By:      /s/ Melvin A. Rhinelander
                                          --------------------------------------
                                          Melvin A. Rhinelander
                                          Chairman of the Board and Chief
                                          Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



        Signature                                    Title                                    Date
        ---------                                    -----                                    ----
                                                                                    
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                  July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Extendicare Health Network,
                                            Inc. (Principal Executive
                                            Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial               July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Extendicare Health Network,
                                            Inc. (Principal Financial Officer
                                            and Principal Accounting
                                            Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic              July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Extendicare
                                            Health Network, Inc.




                                      S-73


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                     PARTNERS HEALTH GROUP, LLC

                                     By:  EXTENDICARE HEALTH NETWORK, INC.,
                                          AS SOLE MEMBER


                                     By:      /s/ Melvin A. Rhinelander
                                          --------------------------------------
                                          Melvin A. Rhinelander
                                          Chairman of the Board and Chief
                                          Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



        Signature                                    Title                                   Date
        ---------                                    -----                                   ----
                                                                                   
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                  July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Extendicare Health Network,
                                            Inc. (Principal Executive
                                            Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial               July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Extendicare Health Network,
                                            Inc. (Principal Financial Officer
                                            and Principal Accounting
                                            Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic              July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Extendicare
                                            Health Network, Inc.




                                      S-74


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                     GREAT TRAIL CARE, LLC

                                     By:  EXTENDICARE GREAT TRAIL, INC.,
                                          AS SOLE MEMBER


                                     By:     /s/ Melvin A. Rhinelander
                                          --------------------------------------
                                          Melvin A. Rhinelander
                                          Chairman of the Board and Chief
                                          Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



       Signature                                    Title                                    Date
       ---------                                    -----                                    ----
                                                                                   
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                 July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Extendicare Great Trail, Inc.
                                            (Principal Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial              July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Extendicare Great Trail, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic             July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Extendicare
                                            Great Trail, Inc.




                                      S-75


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                     KAUFMAN STREET WV, LLC

                                     By:  FIR LANE TERRACE CONVALESCENT
                                          CENTER, INC., AS SOLE MEMBER


                                     By:      /s/ Melvin A. Rhinelander
                                          --------------------------------------
                                          Melvin A. Rhinelander
                                          Chairman of the Board and Chief
                                          Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Fir Lane Terrace
                                            Convalescent Center, Inc.
                                            (Principal Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Fir Lane Terrace
                                            Convalescent Center, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)


/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Fir Lane
                                            Terrace Convalescent Center,
                                            Inc.




                                      S-76


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                     NEW CASTLE CARE, LLC

                                     By:  FIR LANE TERRACE CONVALESCENT
                                          CENTER, INC., AS SOLE MEMBER


                                     By:      /s/ Melvin A. Rhinelander
                                          --------------------------------------
                                          Melvin A. Rhinelander
                                          Chairman of the Board and Chief
                                          Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



         Signature                                    Title                                        Date
         ---------                                    -----                                        ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Fir Lane Terrace
                                            Convalescent Center, Inc.
                                            (Principal Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Fir Lane Terrace
                                            Convalescent Center, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Fir Lane
                                            Terrace Convalescent Center,
                                            Inc.




                                      S-77


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                     MILFORD CARE, LLC

                                     By:  MARSHALL PROPERTIES, INC.,
                                          AS SOLE MEMBER


                                     By:      /s/ Melvin A. Rhinelander
                                          --------------------------------------
                                          Melvin A. Rhinelander
                                          Chairman of the Board and Chief
                                          Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



        Signature                                    Title                                         Date
        ---------                                    -----                                         ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Marshall Properties, Inc.
                                            (Principal Executive Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Marshall Properties, Inc.
                                            (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Marshall
                                            Properties, Inc.




                                      S-78


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                     PARTNERS HEALTH GROUP-FLORIDA, LLC

                                     By:  PARTNERS HEALTH GROUP, LLC, AS
                                          SOLE MEMBER OF PARTNERS
                                          HEALTH GROUP-FLORIDA, LLC

                                     By:  EXTENDICARE HEALTH NETWORK, INC.,
                                          AS SOLE MEMBER OF PARTNERS
                                          HEALTH GROUP, LLC


                                     By:      /s/ Melvin A. Rhinelander
                                          -------------------------------------
                                          Melvin A. Rhinelander
                                          Chairman of the Board and Chief
                                          Executive Officer

                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Extendicare Health Network,
                                            Inc. (Principal Executive
                                            Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Extendicare Health Network,
                                            Inc. (Principal Financial Officer
                                            and Principal Accounting
                                            Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Extendicare
                                            Health Network, Inc.




                                      S-79


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                         PARTNERS HEALTH GROUP-LOUISIANA, LLC

                                         By:  PARTNERS HEALTH GROUP, LLC, AS
                                              SOLE MEMBER OF PARTNERS
                                              HEALTH GROUP-LOUISIANA, LLC

                                         By:  EXTENDICARE HEALTH NETWORK, INC.,
                                              AS SOLE MEMBER OF PARTNERS
                                              HEALTH GROUP, LLC


                                         By:     /s/ Melvin A. Rhinelander
                                              --------------------------------
                                              Melvin A. Rhinelander
                                              Chairman of the Board and Chief
                                              Executive Officer

                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Extendicare Health Network,
                                            Inc. (Principal Executive
                                            Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Extendicare Health Network,
                                            Inc. (Principal Financial Officer
                                            and Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Extendicare
                                            Health Network, Inc.




                                      S-80


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                    PARTNERS HEALTH GROUP-TEXAS, LLC

                                    By:  PARTNERS HEALTH GROUP, LLC, AS
                                         SOLE MEMBER OF PARTNERS
                                         HEALTH GROUP-TEXAS, LLC

                                    By:  EXTENDICARE HEALTH NETWORK, INC.,
                                         AS SOLE MEMBER OF PARTNERS
                                         HEALTH GROUP, LLC


                                    By:        /s/ Melvin A. Rhinelander
                                         ---------------------------------------
                                         Melvin A. Rhinelander
                                         Chairman of the Board and Chief
                                         Executive Officer

                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



         Signature                                    Title                                        Date
         ---------                                    -----                                        ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief                       July 29, 2002
- ------------------------------------        Executive Officer and Director
Melvin A. Rhinelander                       of Extendicare Health Network,
                                            Inc. (Principal Executive
                                            Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Treasurer and Director
Mark W. Durishan                            of Extendicare Health Network,
                                            Inc. (Principal Financial Officer
                                            and Principal Accounting
                                            Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations
Philip W. Small                             and Director of Extendicare
                                            Health Network, Inc.




                                      S-81


                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                     INDIANA HEALTH AND
                                     REHABILITATION PARTNERSHIP

                                     By:  EXTENDICARE HOMES, INC., AS
                                          GENERAL PARTNER


                                     By:      /s/ Melvin A. Rhinelander
                                          --------------------------------------
                                          Melvin A. Rhinelander
                                          Chairman of the Board and Chief
                                          Executive Officer

                                     By:  EXTENDICARE OF INDIANA, INC., AS
                                          GENERAL PARTNER


                                     By:      /s/ Melvin A. Rhinelander
                                          --------------------------------------
                                          Melvin A. Rhinelander
                                          Chairman of the Board and Chief
                                          Executive Officer

                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



        Signature                                     Title                                         Date
        ---------                                     -----                                         ----
                                                                                          
/s/ Melvin A. Rhinelander                 Chairman of the Board, Chief                          July 29, 2002
- ------------------------------------      Executive Officer and Director of
Melvin A. Rhinelander                     Extendicare Homes, Inc. and
                                          Extendicare of Indiana, Inc.
                                          (Principal Executive Officer)

/s/ Mark W. Durishan                      Vice President, Chief Financial                       July 29, 2002
- ------------------------------------      Officer, Treasurer and Director of
Mark W. Durishan                          Extendicare Homes, Inc. and
                                          Extendicare of Indiana, Inc.
                                          (Principal Financial Officer and
                                          Principal Accounting Officer)

/s/ Philip W. Small                       Senior Vice President, Strategic                      July 29, 2002
- ------------------------------------      Planning and Investor Relations and
Philip W. Small                           Director of Extendicare Homes, Inc.
                                          and Extendicare of Indiana, Inc.




                                      S-82

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                 EDGEWOOD CARE, LP

                                 By:  COVENTRY CARE HOLDINGS, INC., AS
                                      GENERAL PARTNER


                                 By:      /s/ Melvin A. Rhinelander
                                      -----------------------------------------
                                      Melvin A. Rhinelander
                                      Chairman of the Board and Chief
                                      Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Coventry Care
Melvin A. Rhinelander                       Holdings, Inc. (Principal Executive
                                            Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Executive Treasurer and
Mark W. Durishan                            Director of Coventry Care Holdings,
                                            Inc. (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Coventry Care Holdings,
                                            Inc.




                                      S-83

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.


                                ELDERCREST CARE, LP

                                By:  COVENTRY CARE HOLDINGS, INC., AS
                                     GENERAL PARTNER


                                By:      /s/ Melvin A. Rhinelander
                                     -----------------------------------------
                                     Melvin A. Rhinelander
                                     Chairman of the Board and Chief
                                     Executive Officer

                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Coventry Care
Melvin A. Rhinelander                       Holdings, Inc. (Principal Executive
                                            Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Executive Treasurer and
Mark W. Durishan                            Director of Coventry Care Holdings,
                                            Inc. (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Coventry Care Holdings,
                                            Inc.




                                      S-84

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                               HAVEN CARE, LP

                               By:  COVENTRY CARE HOLDINGS, INC., AS
                                    GENERAL PARTNER


                               By:      /s/ Melvin A. Rhinelander
                                    -----------------------------------------
                                    Melvin A. Rhinelander
                                    Chairman of the Board and Chief
                                    Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Coventry Care
Melvin A. Rhinelander                       Holdings, Inc. (Principal Executive
                                            Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Executive Treasurer and
Mark W. Durishan                            Director of Coventry Care Holdings,
                                            Inc. (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Coventry Care Holdings,
                                            Inc.




                                      S-85

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                               MEADOW CARE, LP

                               By:  COVENTRY CARE HOLDINGS, INC., AS
                                    GENERAL PARTNER


                               By:      /s/ Melvin A. Rhinelander
                                    -----------------------------------------
                                    Melvin A. Rhinelander
                                    Chairman of the Board and Chief
                                    Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Coventry Care
Melvin A. Rhinelander                       Holdings, Inc. (Principal Executive
                                            Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Executive Treasurer and
Mark W. Durishan                            Director of Coventry Care Holdings,
                                            Inc. (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Coventry Care Holdings,
                                            Inc.




                                      S-86

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                OAK HILL CARE, LP

                                By:  COVENTRY CARE HOLDINGS, INC., AS
                                     GENERAL PARTNER


                                By:     /s/ Melvin A. Rhinelander
                                     -----------------------------------------
                                     Melvin A. Rhinelander
                                     Chairman of the Board and Chief
                                     Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Coventry Care
Melvin A. Rhinelander                       Holdings, Inc. (Principal Executive
                                            Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Executive Treasurer and
Mark W. Durishan                            Director of Coventry Care Holdings,
                                            Inc. (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Coventry Care Holdings,
                                            Inc.




                                      S-87

                                   SIGNATURES

                  Pursuant to the requirements of the Securities Act of 1933,
the Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Milwaukee,
State of Wisconsin, on July 29, 2002.

                                 STONEBRIDGE CARE, LP

                                 By:  COVENTRY CARE HOLDINGS, INC., AS
                                      GENERAL PARTNER


                                 By:       /s/ Melvin A. Rhinelander
                                      -----------------------------------------
                                      Melvin A. Rhinelander
                                      Chairman of the Board and Chief
                                      Executive Officer


                  Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.



                Signature                                    Title                                  Date
                ---------                                    -----                                  ----
                                                                                         
/s/ Melvin A. Rhinelander                   Chairman of the Board, Chief Executive             July 29, 2002
- ------------------------------------        Officer and Director of Coventry Care
Melvin A. Rhinelander                       Holdings, Inc. (Principal Executive
                                            Officer)

/s/ Mark W. Durishan                        Vice President, Chief Financial                    July 29, 2002
- ------------------------------------        Officer, Executive Treasurer and
Mark W. Durishan                            Director of Coventry Care Holdings,
                                            Inc. (Principal Financial Officer and
                                            Principal Accounting Officer)

/s/ Philip W. Small                         Senior Vice President, Strategic                   July 29, 2002
- ------------------------------------        Planning and Investor Relations and
Philip W. Small                             Director of Coventry Care Holdings,
                                            Inc.




                                      S-88





                                  EXHIBIT INDEX


    EXHIBIT
    -------
    NUMBER                        DOCUMENT DESCRIPTION
    ------                        --------------------

    (3.1)        Restated Certificate of Incorporation of Extendicare Health
                 Services, Inc. (Incorporated by reference to the Company's
                 Registration Statement on Form S-4 (Registration No.
                 333-43549)).

    (3.2)        By-Laws of Extendicare Health Services, Inc. (Incorporated by
                 reference to the Company's Registration Statement on Form S-4
                 (Registration No. 333-43549)).

    (3.3)        Certificate of Incorporation of Adult Services Unlimited, Inc.

    (3.4)        Bylaws of Adult Services Unlimited, Inc.

    (3.5)        Articles of Organization of Alpine Health and Rehabilitation
                 Center, LLC.

    (3.6)        Articles of Organization of Arbors at Bayonet Point, LLC.

    (3.7)        Articles of Organization of Arbors at Fairlawn Care, LLC.

    (3.8)        Articles of Organization of Arbors at Fairlawn Realty OH, LLC.

    (3.9)        Articles of Organization of Arbors at Sylvania Care, LLC.

    (3.10)       Articles of Organization of Arbors at Sylvania Realty OH, LLC.

    (3.11)       Articles of Organization of Arbors at Tampa, LLC.

    (3.12)       Articles of Incorporation of Arbors at Toledo, Inc.

    (3.13)       Code of Regulations of Arbors at Toledo, Inc.

    (3.14)       Certificate of Incorporation of Arbors East, Inc.

    (3.15)       Code of Regulations of Arbors East, Inc.

    (3.16)       Articles of Organization of Arbors West Care, LLC.

    (3.17)       Articles of Organization of Arbors West Realty OH, LLC.

    (3.18)       Articles of Organization of Blanchester Care, LLC.



                                      E-1






    EXHIBIT
    -------
    NUMBER                        DOCUMENT DESCRIPTION
    ------                        --------------------


    (3.19)       Articles of Organization of Canton Care, LLC.

    (3.20)       Articles of Organization of Colonial Care, LLC.

    (3.21)       Articles of Organization of Columbus Rehabilitation Care, LLC.

    (3.22)       Articles of Organization of Columbus Rehabilitation Realty OH,
                 LLC.

    (3.23)       Articles of Organization of Concordia Manor, LLC.

    (3.24)       Certificate of Incorporation of Coventry Care Holdings, Inc.

    (3.25)       Articles of Incorporation of Coventry Care, Inc.

    (3.26)       By-laws of Coventry Care, Inc.

    (3.27)       Articles of Organization of Dayton Care, LLC.

    (3.28)       Articles of Organization of Delaware Care, LLC.

    (3.29)       Certificate of Formation of Edgewood Care, LP.

    (3.30)       Articles of Incorporation of Edgewood Nursing Center, Inc.

    (3.31)       By-laws of Edgewood Nursing Center, Inc.

    (3.32)       Certificate of Formation of Eldercrest Care, LP.

    (3.33)       Articles of Incorporation of Elder Crest, Inc.

    (3.34)       By-laws of Elder Crest, Inc.

    (3.35)       Certificate of Incorporation of Extendicare Great Trail, Inc.

    (3.36)       By-laws of Extendicare Great Trail, Inc.

    (3.37)       Articles of Incorporation of Extendicare Health Facilities,
                 Inc.

    (3.38)       By-laws of Extendicare Health Facilities, Inc.


                                      E-2



    EXHIBIT
    -------
    NUMBER                        DOCUMENT DESCRIPTION
    ------                        --------------------


    (3.39)       Certificate of Incorporation of Extendicare Health Facility
                 Holdings, Inc.

    (3.40)       By-laws of Extendicare Health Facility Holdings, Inc.

    (3.41)       Certificate of Incorporation of Extendicare Health Network,
                 Inc.

    (3.42)       By-laws of Extendicare Health Network, Inc.

    (3.43)       Certificate of Incorporation of Extendicare Homes, Inc.

    (3.44)       By-laws of Extendicare Homes, Inc.

    (3.45)       Certificate of Incorporation of Extendicare of Indiana, Inc.

    (3.46)       By-laws of Extendicare of Indiana, Inc.

    (3.47)       Certificate of Incorporation of Fir Lane Terrace Convalescent
                 Center, Inc.

    (3.48)       Bylaws of Fir Lane Terrace Convalescent Center, Inc.

    (3.49)       Articles of Organization of First Coast Health and
                 Rehabilitation Center, LLC.

    (3.50)       Certificate of Formation of Fiscal Services Group, LLC.

    (3.51)       Articles of Organization of Gallipolis Care, LLC.

    (3.52)       Articles of Organization of Great Trail Care, LLC.

    (3.53)       Articles of Organization of Greenbriar Care, LLC.

    (3.54)       Articles of Organization of Greenbrook Care, LLC.

    (3.55)       Certificate of Formation of Haven Care, LP.

    (3.56)       Articles of Incorporation of Haven Crest, Inc.

    (3.57)       By-laws of Haven Crest, Inc.

    (3.58)       Articles of Incorporation of Health Poconos, Inc.


                                      E-3




    EXHIBIT
    -------
    NUMBER                        DOCUMENT DESCRIPTION
    ------                        --------------------


    (3.59)       Bylaws of Health Poconos, Inc.

    (3.60)       Articles of Organization of Heritage Care, LLC.

    (3.61)       Articles of Organization of Hilliard Care, LLC.

    (3.62)       Articles of Organization of Jackson Heights Rehabilitation
                 Center, LLC.

    (3.63)       Articles of Organization of Jacksonville Care, LLC.

    (3.64)       Articles of Organization of Kaufman Street, WV, LLC.

    (3.65)       Articles of Organization of Kissimmee Care, LLC.

    (3.66)       Articles of Organization of Lady Lake Care, LLC.

    (3.67)       Articles of Organization of London Care, LLC.

    (3.68)       Articles of Organization of Marietta Care, LLC.

    (3.69)       Certificate of Incorporation of Marshall Properties, Inc.

    (3.70)       Code of Regulations of Marshall Properties, Inc.

    (3.71)       Certificate of Formation of Meadow Care, LP.

    (3.72)       Articles of Incorporation of Meadow Crest, Inc.

    (3.73)       By-laws of Meadow Crest, Inc.

    (3.74)       Articles of Organization of Milford Care, LLC.

    (3.75)       Certificate of Formation of New Castle Care, LLC.

    (3.76)       Articles of Organization of New Horizon Care, LLC.

    (3.77)       Articles of Organization of North Rehabilitation Care, LLC.

    (3.78)       Certificate of Incorporation of Northern Health Facilities,
                 Inc.

                                      E-4





    EXHIBIT
    -------
    NUMBER                        DOCUMENT DESCRIPTION
    ------                        --------------------


    (3.79)       By-laws of Northern Health Facilities, Inc.

    (3.80)       Certificate of Formation of Oak Hill Care, LP.

    (3.81)       Articles of Incorporation of Oak Hill Home of Rest and Care,
                 Inc.

    (3.82)       By-laws of Oak Hill Home of Rest and Care, Inc.

    (3.83)       Articles of Organization of Orange Park Care, LLC.

    (3.84)       Articles of Organization of Oregon Care, LLC.

    (3.85)       Articles of Formation of Palm Court Care, LLC.

    (3.86)       Certificate of Formation of Partners Health Group -- Florida,
                 LLC.

    (3.87)       Certificate of Formation of Partners Health Group -- Louisiana,
                 LLC.

    (3.88)       Certificate of Formation of Partners Health Group -- Texas,
                 LLC.

    (3.89)       Certificate of Formation of Partners Health Group, LLC.

    (3.90)       Articles of Organization of Port Charlotte Care, LLC.

    (3.91)       Articles of Organization of Richey Manor, LLC.

    (3.92)       Articles of Organization of Rockledge Care, LLC.

    (3.93)       Articles of Organization of Rockmill Care, LLC.

    (3.94)       Articles of Organization of Rocksprings Care, LLC.

    (3.95)       Articles of Organization of Safety Harbor Care, LLC.

    (3.96)       Articles of Organization of Sarasota Care, LLC.

    (3.97)       Articles of Organization of Seminole Care, LLC.

    (3.98)       Articles of Organization of South Heritage Health and
                 Rehabilitation Center, LLC.

                                      E-5




   EXHIBIT
    -------
    NUMBER                        DOCUMENT DESCRIPTION
    ------                        --------------------


    (3.99)       Certificate of Formation of Stonebridge Care, LP.

    (3.100)      Articles of Organization of The Oaks Residential and
                 Rehabilitation Center, LLC.

    (3.101)      Articles of Incorporation of The Progressive Step Corporation.

    (3.102)      By-laws of The Progressive Step Corporation.

    (3.103)      Articles of Organization of Treasure Isle Care Center, LLC.

    (3.104)      Articles of Incorporation of United Professional Services, Inc.

    (3.105)      By-laws of United Professional Services, Inc.

    (3.106)      Articles of Organization of Waterville Care, LLC.

    (3.107)      Articles of Organization of Winter Haven Care, LLC.

    (3.108)      Articles of Organization of Winter Haven Health and
                 Rehabilitation Center, LLC.

    (3.109)      Articles of Organization of Woodsfield Care, LLC.

    (3.110)      By-Laws of Coventry Care Holdings, Inc.

    (4.1)        Indenture, dated as of December 2, 1997, between Extendicare
                 Health Services, Inc., the Guarantors named therein and the
                 Bank of Nova Scotia Trust Company of New York, as Trustee
                 (Incorporated by reference to the Company's Registration
                 Statement on Form S-4 (Registration No. 333-43549)).

    (4.2)        Purchase Agreement, dated as of June 20, 2002, between
                 Extendicare Health Services, Inc., the Guarantors named
                 therein, Lehman Brothers, Inc., ABN AMRO Incorporated and U.S.
                 Bancorp Piper Jaffrey Inc.

    (4.3)        Indenture, dated as of June 28, 2002, among Extendicare Health
                 Services, Inc., the Guarantors named therein, as Guarantors,
                 and U.S. Bank, N.A., as Trustee.

    (4.4)        Exchange and Registration Rights Agreement, dated as of June
                 28, 2002, among Extendicare Health Services, Inc., the
                 Guarantors named therein, Lehman Brothers Inc., ABN AMRO
                 Incorporated and U.S. Bancorp Piper Jaffrey Inc.

    (4.5)        Credit Agreement, dated as of June 28, 2002, among Extendicare
                 Holdings, Inc., Extendicare Health Services, Inc., Lehman
                 Brothers Inc., as Arranger, Lehman Commercial Paper Inc., as
                 Administrative Agent, U.S. Bank National Association, as
                 Syndication Agent, GE Capital Corporation, Residential Funding
                 Corporation d/b/a GMAC-RFC Health Capital, LaSalle Bank
                 National Association, as Co-Documentation



                                      E-6





    EXHIBIT
    -------
    NUMBER                        DOCUMENT DESCRIPTION
    ------                        --------------------



                 Agent and other lenders thereto.


                 Pursuant to Item 601(b) (4) (iii) of Regulation S-K, the
                 Registrants agree to furnish to the Securities and Exchange
                 Commission, upon request, any instrument defining the rights of
                 holders of long-term debt not being registered that is not
                 filed as an exhibit to this Registration Statement on Form S-4.
                 No such instrument authorizes securities in excess of 10% of
                 the total assets of Extendicare Health Services, Inc. or the
                 subsidiary guarantors, as the case may be.

    (5)          Opinion of Foley & Lardner (including consent of counsel).

    (12)         Statement regarding computation of ratios of earnings to fixed
                 charges.

   (23.1)        Consent of KPMG LLP.

   (23.2)        Consent of Foley & Lardner (filed as part of Exhibit (5)).

    (25)         Form T-1 Statement of Eligibility under the Trust Indenture Act
                 of 1939 of U.S. Bank, N.A.

    (99.1)       Schedule II -- Valuation and Qualifying Accounts and related
                 Independent Auditors Report.

    (99.2)       Form of Letter of Transmittal.

    (99.3)       Form of Notice of Guaranteed Delivery.

    (99.4)       Guidelines for Certification of Taxpayer Identification Number
                 on Substitute Form W-9.

    (99.5)       Form of Letter to Clients.

    (99.6)       Form of Instructions to Registered Holder and/or Participants
                 in DTC from Beneficial Owners.

    (99.7)       Form of Letter to Nominees.




                                      E-7

EX-3.3

                                                                     EXHIBIT 3.3

                            ARTICLES OF INCORPORATION

                                       OF

                         ADULT SERVICES UNLIMITED, INC.

                  In compliance with the requirements of section 204 of the
Business Corporation Law Act of May 5, 1933 (P. L. 364) (15 P. S. Section 1204)
the undersigned, desiring to be incorporated as a business corporation, hereby
certifies (certify) that:

                  1. The name of the Corporation is: ADULT SERVICES UNLIMITED,
INC.

                  2. The location and post office address of the initial
registered office of the corporation in this Commonwealth is: 24 Laurelwood
Drive, Laflin, Pennsylvania 18702.

                  3. The corporation is incorporated under the Business
Corporation Law of the Commonwealth of Pennsylvania for the following purpose or
purposes:

                  The corporation shall have the unlimited power to engage in
                  and do any lawful act concerning any and all business for
                  which corporations may be incorporated under the Business
                  Corporation Law of Pennsylvania, approved May 5, 1933, P. L.
                  364, as amended.

                  4. The term for which the corporation is to exist is:
Perpetual

                  5. The aggregate number of shares which the corporation shall
have authority to issue is: 100,000 at $10.00 par value

                  6. The names and post office addresses of each of the
incorporators and the number and class of shares subscribed by such
incorporators are:




NAME                                                ADDRESS                                 NUMBER AND
                                       (including street and number if any)              CLASS OF SHARES

                                                                                   
Diane Bartoli                           24 Laurelwood Drive, Laflin, PA                     50 - Common
Bernard Bartoli                         24 Laurelwood Drive, Laflin, PA                     50 - Common

EX-3.4

                                                                     EXHIBIT 3.4
                                     BYLAWS
                                       OF
                         ADULT SERVICES UNLIMITED, INC.


                          (A PENNSYLVANIA CORPORATION)


                                    ARTICLE I
                             OFFICES AND FISCAL YEAR

                  Section 1.01. REGISTERED OFFICE. The registered office of the
corporation in Pennsylvania shall be at 24 Laurelwood Drive, Laflin,
Pennsylvania until otherwise established by an amendment of the articles or by
the board of directors and a record of such change is filed with the Department
of State in the manner provided by law.

                  Section 1.02. OTHER OFFICE. The corporation may also have
offices at such other places within or without Pennsylvania as the board of
directors may from time to time appoint or the business of the corporation may
require.

                  Section 1.03. FISCAL YEAR. The fiscal year of the corporation
shall begin the first day of January in each year.


                                   ARTICLE II
                      NOTICE - WAIVERS - MEETINGS GENERALLY

                  Section 2.01. MANNER OF GIVING NOTICE.

                  (a) General rule. Whenever written notice is required to be
given to any person under the provisions of the Business Corporation Law or by
the Articles or these bylaws, it may be given to the person either personally or
by sending a copy thereof by first class or express mail, postage prepaid, or by
telegram (with messenger service specified), telex or TWX (with answerback
received) or courier service, charges prepaid, or by facsimile transmission, to
the address (or to the telex, TWX or facsimile number) of the person appearing
on the books of the corporation or, in the case of directors, supplied by the
directors to the corporation for the purpose of notice. If the notice is sent by
mail, telegraph or courier service, it shall be deemed to have been given to the
person entitled thereto when deposited in the United States mail or with a
telegraph office or courier service for delivery to that person or, in the case
of telex or TWX, when dispatched or, in the case of facsimile, when received. A
notice of meeting shall specify the place, day and hour of the meeting and any
other information required by any other provision of the Business Corporation
Law, the articles or these bylaws.

                  (b) Adjourned shareholder meetings. When a meeting of
shareholders is adjourned, it shall not be necessary to give any notice of the
adjourned meeting or of the business to be transacted at an adjourned meeting,
other than by announcement at the meeting at which the adjournment is taken,
unless the board fixes a new record date for the adjourned meeting or these
bylaws require notice of the business to be transacted and such notice has not
previously been given.






                  Section 2.02. NOTICE OF MEETINGS OF BOARD OF DIRECTORS.

Notice of a regular meeting of the board of directors need not be given. Notice
of every special meeting of the board of directors shall be given to each
director by telephone or in writing at least 24 hours (in the case of notice by
telephone, telex, TWX or facsimile transmission) or 48 hours (in the case of
notice by telegraph, courier service or express mail) or five days (in the case
of notice by first class mail) before the time at which the meeting is to be
held. Every such notice shall state the time and place of the meeting. Neither
the business to be transacted at, nor the purpose of, any regular or special
meeting of the board need be specified in a notice of a meeting.

                  Section 2.03.     NOTICE OF MEETINGS OF SHAREHOLDERS.

                  (a) General rule. Written notice of every meeting of the
shareholders shall be given by, or at the direction of, the secretary to each
shareholder of record entitled to vote at the meeting at least:

                           (1) ten days prior to the day named for a meeting
         called to consider a fundamental transaction under 15 Pa.C.S. Chapter
         19 regarding amendments of articles of incorporation, mergers,
         consolidations, share exchanges, sale of assets, divisions,
         conversions, liquidations and dissolution; or

                           (2) five days prior to the day named for the meeting
         in any other case.

If the secretary neglects or refuses to give notice of a meeting, the person or
persons calling the meeting may do so. In the case of a special meeting of
shareholders, the notice shall specify the general nature of the business to be
transacted, and in all cases the notice shall comply with the express
requirements of this section. The corporation shall not have a duty to augment
the notice.

                  (b) Notice of action by shareholders on bylaws. In the case of
a meeting of shareholders that has as one its purposes action on the bylaws,
written notice shall be given to each shareholder that the purpose, or one of
the purposes, of the meeting is to consider the adoption, amendment or repeal of
the bylaws. There shall be included in, or enclosed with, the notice a copy of
the proposed amendment or a summary of the changes to be effected thereby.

                  Section 2.04. WAIVER OF NOTICE.

                  (a) Written waiver. Whenever any written notice is required to
be given under the provisions of the Business Corporation Law, the articles or
these bylaws, a waiver thereof in writing, signed by the person or persons
entitled to the notice, whether before or after the time stated therein, shall
be deemed equivalent to the giving of the notice. Except as otherwise required
by this subsection, neither the business to be transacted at, nor the purpose
of, a meeting need be specified in the waiver of notice of the meeting. In the
case of a special meeting of shareholders, the waiver of notice shall specify
the general nature of the business to be transacted.


                                       2



                  (b) Waiver by attendance. Attendance of a person at any
meeting shall constitute a waiver of notice of the meeting except where a person
attends a meeting for the express purpose of objecting, at the beginning of the
meeting, to the transaction of any business because the meeting was not lawfully
called or convened.

                  Section 2.05. MODIFICATION OF PROPOSAL CONTAINED IN NOTICE.

                  Whenever the language of a proposed resolution is included in
a written notice of a meeting required to be given under the provisions of the
Business Corporation Law or the articles or these bylaws, the meeting
considering the resolution may without further notice adopt it with such
clarifying or other amendments as do not enlarge its original purpose.

                  Section 2.06. EXCEPTION TO REQUIREMENT OF NOTICE.

                  (a) General rule. Whenever any notice or communication is
required to be given to any person under the provisions of the Business
Corporation Law or by the articles or these bylaws or by the terms of any
agreement or other instrument or as a condition precedent to taking any
corporate action and communication with that person is then unlawful, the giving
of the notice or communication to that person shall not be required.

                  (b) Shareholders without forwarding addresses. Notice or other
communications shall not be sent to any shareholder with whom the corporation
has been unable to communicate for more than 24 consecutive months because
communications to the shareholder are returned unclaimed or the shareholder has
otherwise failed to provide the corporation with a current address. Whenever the
shareholder provides the corporation with a current address, the corporation
shall commence sending notices and other communications to the shareholder in
the same manner as to other shareholders.

                  Section 2.07. USE OF CONFERENCE TELEPHONE AND SIMILAR
EQUIPMENT. One or more persons may participate in a meeting of the board of
directors or the shareholders of the corporation by means of conference
telephone or similar communications equipment by means of which all persons
participating in the meeting can hear each other. Participation in a meeting
pursuant to this section shall constitute presence in person at the meeting.


                                   ARTICLE III
                                  SHAREHOLDERS

                  Section 3.01. PLACE OF MEETING. All meetings of the
shareholders of the corporation shall be held at the registered office of the
corporation unless another place is designated by the board of directors in the
notice of a meeting.

                  Section 3.02. ANNUAL MEETING. The board of directors may fix
the date and time of the annual meeting of the shareholders, but if no such date
and time is fixed by the board, the meeting for any calendar year shall be held
on the 5th day of January in such year, if not a legal holiday under the laws of
Pennsylvania, and, if a legal holiday, then on the next succeeding business day,
not a Saturday, at ten o'clock A.M., and at said meeting the

                                       3



shareholders then entitled to vote shall elect directors and shall transact such
other business as may properly be brought before the meeting. If the annual
meeting shall not have been called and held within six months after the
designated time, any shareholder may call the meeting at any time thereafter.
Except as otherwise provided in the articles, at least one meeting of the
shareholders shall be held in each calendar year for the election of directors.

                  Section 3.03. SPECIAL MEETINGS.

                  (a) Call of special meetings. Special meetings of the
shareholders may be called at any time:

                           (1) by the board of directors; or

                           (2) unless otherwise provided in the articles, by
         shareholders entitled to cast at least 20% of the vote that all
         shareholders are entitled to cast at the particular meeting.

                  (b) Fixing of time for meeting. At any time, upon written
request of any person who has called a special meeting, it shall be the duty of
the secretary to fix the time of the meeting which shall be held not more than
60 days after the receipt of the request. If the secretary neglects or refuses
to fix a time of the meeting, the person or persons calling the meeting may do
so.

                  Section 3.04. QUORUM AND ADJOURNMENT.

                  (a) General rule. A meeting of shareholders of the corporation
duly called shall not be organized for the transaction of business unless a
quorum is present. The presence of shareholders entitled to cast at least a
majority of the votes that all shareholders are entitled to cast on a particular
matter to be acted upon at the meeting shall constitute a quorum for the
purposes of consideration and action on the matter. Shares of the corporation
owned, directly or indirectly, by it and controlled, directly or indirectly, by
the board of directors of this corporation, as such, shall not be counted in
determining the total number of outstanding shares for quorum purposes at any
given time.

                  (b) Withdrawal of a quorum. The shareholders present at a duly
organized meeting can continue to do business until adjournment notwithstanding
the withdrawal of enough shareholders to leave less than a quorum.

                  (c) Adjournment for lack of quorum. If a meeting cannot be
organized because a quorum has not attended, those present may, except as
provided in the Business Corporation Law, adjourn the meeting to such time and
place as they may determine.

                  (d) Adjournments generally. Any meeting at which directors are
to be elected shall be adjourned only from day to day, or for such longer
periods not exceeding 15 days each as the shareholders present and entitled to
vote shall direct, until the directors have been elected. Any other regular or
special meeting may be adjourned for such period as the shareholders present and
entitled to vote shall direct.


                                       4





                  (e) Electing directors at adjourned meeting. Those
shareholders entitled to vote who attend a meeting called for the election of
directors that has been previously adjourned for lack of a quorum, although less
than a quorum as fixed in this section, shall nevertheless constitute a quorum
for the purpose of electing directors.

                  (f) Other action in absence of quorum. Those shareholders
entitled to vote who attend a meeting of shareholders that has been previously
adjourned for one or more periods aggregating at least 15 days because of an
absence of a quorum, although less than a quorum as fixed in this section, shall
nevertheless constitute a quorum for the purpose of acting upon any matter set
forth in the notice of the meeting if the notice states that those shareholders
who attend the adjourned meeting shall nevertheless constitute a quorum for the
purpose of acting upon the matter.

                  Section 3.05. ACTION BY SHAREHOLDERS.

                  (a) General rule. Except as otherwise provided in the Business
Corporation Law or the articles or these bylaws, whenever any corporate action
is to be taken by vote of the shareholders of the corporation, it shall be
authorized upon receiving the affirmative vote of a majority of the votes cast
by all shareholders entitled to vote thereon.

                  (b) Interested shareholders. Any merger or other transaction
authorized under 15 Pa.C.S. Subchapter 19C between the corporation or subsidiary
thereof and a shareholder of this corporation, or any voluntary liquidation
authorized under 15 Pa.C.S. Subchapter 19F in which a shareholder is treated
differently from other shareholders of the same class (other than any dissenting
shareholders), shall require the affirmative vote of the shareholders entitled
to cast at least a majority of the votes that all shareholders other than the
interested shareholder are entitled to cast with respect to the transaction,
without counting the vote of the interested shareholder. For the purposes of the
preceding sentence, interested shareholder shall include the shareholder who is
a party to the transaction or who is treated differently from other shareholders
and any person, or group of persons, that is acting jointly or in concert with
the interested shareholder and any person who, directly or indirectly, controls,
is controlled by or is under common control with the interested shareholder. An
interested shareholder shall not include any person who, in good faith and not
for the purpose of circumventing this subsection, is an agent, bank, broker,
nominee or trustee for one or more other persons, to the extent that the other
person or persons are not interested shareholders.

                  (c) Exceptions. Subsection (b) shall not apply to a
transaction:

                           (1) that has been approved by a majority vote of the
         board of directors without counting the vote of directors who:

                                    (i) are directors or officers of, or have a
                  material equity interest in, the interested shareholder; or

                                    (ii) were nominated for election as a
                  director by the interested shareholder, and first elected as a
                  director, within 24 months of the date of the vote on the
                  proposed transaction; or


                                       5





                           (2) in which the consideration to be received by the
         shareholders for shares of any class of which shares are owned by the
         interested shareholder is not less than the highest amount paid by the
         interested shareholder in acquiring shares of the same class.

                  (d) Additional approvals. The approvals required by subsection
(b) shall be in addition to, and not in lieu of, any other approval required by
the Business Corporation Law, the articles or these bylaws, or otherwise.

                  Section 3.06. ORGANIZATION. At every meeting of the
shareholders, the chairman of the board, if there be one, or, in the case of
vacancy in office or absence of the chairman of the board, one of the following
officers present in the order stated: the vice chairman of the board, if there
be one, the president, the vice presidents in their order of rank and seniority,
or a person chosen by vote of the shareholders present, shall act as chairman of
the meeting. The secretary or, in the absence of the secretary, an assistant
secretary, or in the absence of both the secretary and assistant secretaries, a
person appointed by the chairman of the meeting, shall act as secretary.

                  Section 3.07. VOTING RIGHTS OF SHAREHOLDERS. Unless otherwise
provided in the articles, every shareholder of the corporation shall be entitled
to one vote for every share standing in the name of the shareholder on the books
of the corporation.

                  Section 3.08. VOTING AND OTHER ACTION BY PROXY.

                  (a) General rule.

                           (1) Every shareholder entitled to vote at a meeting
         of shareholders or to express consent or dissent to corporate action in
         writing without a meeting may authorize another person to act for the
         shareholder by proxy.

                           (2) The presence of, or vote or other action at a
         meeting of shareholders, or the expression of consent or dissent to
         corporate action in writing, by a proxy of a shareholder shall
         constitute the presence of, or vote or action by, or written consent or
         dissent of the shareholder.

                           (3) Where two or more proxies of a shareholder are
         present, the corporation shall, unless otherwise expressly provided in
         the proxy, accept as the vote of all shares represented thereby the
         vote cast by a majority of them and, if a majority of the proxies
         cannot agree whether the shares represented shall be voted or upon the
         manner of voting the shares, the voting of the shares shall be divided
         equally among those persons.

                  (b) Execution and filing. Every proxy shall be executed in
writing by the shareholder or by the duly authorized attorney-in-fact of the
shareholder and filed with the secretary of the corporation. A telegram, telex,
cablegram, datagram or similar transmission from a shareholder or
attorney-in-fact, or a photographic, facsimile or similar reproduction of a
writing executed by a shareholder or attorney-in-fact:


                                       6





                           (1) may be treated as properly executed for purposes
         of this section; and

                           (2) shall be so treated if it sets forth a
         confidential and unique identification number or other mark furnished
         by the corporation to the shareholder for the purposes of a particular
         meeting or transaction.

                  (c) Revocation. A proxy, unless coupled with an interest,
shall be revocable at will, notwithstanding any other agreement or any provision
in the proxy to the contrary, but the revocation of a proxy shall not be
effective until written notice thereof has been given to the secretary of the
corporation. An unrevoked proxy shall not be valid after three years from the
date of its execution unless a longer time is expressly provided therein. A
proxy shall not be revoked by the death or incapacity of the maker unless,
before the vote is counted or the authority is exercised, written notice of the
death or incapacity is given to the secretary of the corporation.

                  (d) Expenses. Unless otherwise restricted in the articles, the
corporation shall pay the reasonable expenses of solicitation of votes, proxies
or consents of shareholders by or on behalf of the board of directors or its
nominees for election to the board, including solicitation by professional proxy
solicitors and otherwise.

                  Section 3.09. VOTING BY FIDUCIARIES AND PLEDGEES. Shares of
the corporation standing in the name of a trustee or other fiduciary and shares
held by an assignee for the benefit of creditors or by a receiver may be voted
by the trustee, fiduciary, assignee or receiver. A shareholder whose shares are
pledged shall be entitled to vote the shares until the shares have been
transferred into the name of the pledgee, or a nominee of the pledgee, but
nothing in this section shall affect the validity of a proxy given to a pledgee
or nominee.

                  Section 3.10. VOTING BY JOINT HOLDERS OF SHARES.

                  (a) General rule. Where shares of the corporation are held
jointly or as tenants in common by two or more persons, as fiduciaries or
otherwise:

                           (1) if only one or more of such persons is present in
         person or by proxy, all of the shares standing in the names of such
         persons shall be deemed to be represented for the purpose of
         determining a quorum and the corporation shall accept as the vote of
         all the shares the vote cast by a joint owner or a majority of them;
         and

                           (2) if the persons are equally divided upon whether
         the shares held by them shall be voted or upon the manner of voting the
         shares, the voting of the shares shall be divided equally among the
         persons without prejudice to the rights of the joint owners or the
         beneficial owners thereof among themselves.

                  (b) Exception. If there has been filed with the secretary of
the corporation a copy, certified by an attorney at law to be correct, of the
relevant portions of the agreement under which the shares are held or the
instrument by which the trust or estate was created or the order of court
appointing them or of an order of court directing the voting of the shares, the
persons


                                       7





specified as having such voting power in the document latest in date of
operative effect so filed, and only those persons, shall be entitled to vote the
shares but only in accordance therewith.

                  Section 3.11. VOTING BY CORPORATIONS

                  (a) Voting by corporate shareholders. Any corporation that is
a shareholder of this corporation may vote by any of its officers or agents, or
by proxy appointed by any officer or agent, unless some other person, by
resolution of the board of directors of the other corporation or provision of
its articles or bylaws, a copy of which resolution or provision certified to be
correct by one of its officers has been filed with the secretary of this
corporation, is appointed its general or special proxy in which case that person
shall be entitled to vote the shares.

                  (b) Controlled shares. Shares of this corporation owned,
directly or indirectly, by it and controlled, directly or indirectly, by the
board of directors of this corporation, as such, shall not be voted at any
meeting and shall not be counted in determining the total number of outstanding
shares for voting purposes at any given time.

                  Section 3.12. DETERMINATION OF SHAREHOLDERS OF RECORD.

                  (a) Fixing record date. The board of directors may fix a time
prior to the date of any meeting of shareholders as a record date for the
determination of the shareholders entitled to notice of, or to vote at, the
meeting, which time, except in the case of an adjourned meeting, shall be not
more than 90 days prior to the date of the meeting of shareholders. Only
shareholders of record on the date fixed shall be so entitled notwithstanding
any transfer of shares on the books of the corporation after any record date
fixed as provided in this subsection. The board of directors may similarly fix a
record date for the determination of shareholders of record for any other
purpose. When a determination of shareholders of record has been made as
provided in this section for purposes of a meeting, the determination shall
apply to any adjournment thereof unless the board fixes a new record date for
the adjourned meeting.

                  (b) Determination when a record date is not fixed. If a record
date is not fixed:

                           (1) The record date for determining shareholders
         entitled to notice of or to vote at a meeting of shareholders shall be
         at the close of business on the date next preceding the day on which
         notice is given or, if notice is waived, at the close of business on
         the day immediately preceding the day on which the meeting is held.

                           (2) The record date for determining shareholders
         entitled to express consent or dissent to corporate action in writing
         without a meeting, when prior action by the board of directors is not
         necessary, to call a special meeting of the shareholders or propose an
         amendment of the articles, shall be the close of business on the day on
         which the first written consent or dissent, request for a special
         meeting or petition proposing an amendment of the articles is filed
         with the secretary of the corporation.


                                       8





                           (3) The record date for determining shareholders for
         any other purpose shall be at the close of business on the day on which
         the board of directors adopts the resolution relating thereto.

                  Section 3.13. VOTING LISTS.

                  (a) General rule. The officer or agent having charge of the
transfer books for shares of the corporation shall make a complete list of the
shareholders entitled to vote at any meeting of shareholders, arranged in
alphabetical order, with the address of and of the number of shares held by
each. The list shall be produced and kept open at the time and place of the
meeting and shall be subject to the inspection of any shareholder during the
whole time of the meeting for the purposes thereof.

                  (b) Effect of list. Failure to comply with the requirements of
this section shall not effect the validity of any action taken at a meeting
prior to a demand at the meeting by any shareholder entitled to vote thereat to
examine the list. The original share register or transfer book, or a duplicate
thereof kept in this Commonwealth, shall be prima facie evidence as to who are
the shareholders entitled to examine the list or share register or transfer book
or to vote at any meeting of shareholders.

                  Section 3.14. JUDGES OF ELECTION.

                  (a) Appointment. In advance of any meeting of shareholders of
the corporation, the board of directors may appoint judges of election, who need
not be shareholders, to act at the meeting or any adjournment thereof. If judges
of election are not so appointed, the presiding officer of the meeting may, and
on the request of any shareholder shall, appoint judges of election at the
meeting. The number of judges shall be one or three. A person who is a candidate
for office to be filled at the meeting shall not act as a judge.

                  (b) Vacancies. In case any person appointed as a judge fails
to appear or fails or refuses to act, the vacancy may be filled by appointment
made by the board of directors in advance of the convening of the meeting or at
the meeting by the presiding officer thereof.

                  (c) Duties. The judges of election shall determine the number
of shares outstanding and the voting power of each, the shares represented at
the meeting, the existence of a quorum, the authenticity, validity and effect of
proxies, receive votes or ballots, hear and determine all challenges and
questions in any way arising in connection with the right to vote, count and
tabulate all votes, determine the result and do such acts as may be proper to
conduct the election or vote with fairness to all shareholders. The judges of
election shall perform their duties impartially, in good faith, to the best of
their ability and as expeditiously as is practical. If there are three judges of
election, the decision, act or certificate of a majority shall be effective in
all respects as the decision, act or certificate of all.

                  (d) Report. On request of the presiding officer of the
meeting, or of any shareholder, the judge shall make a report in writing of any
challenge or question or matter determined by them, and execute a certificate of
any fact found by them. Any report or certificate made by them shall be prima
facie evidence of the facts stated therein.


                                       9





                  Section 3.15. CONSENT OF SHAREHOLDERS IN LIEU OF MEETING.

                  (a) Unanimous written consent. Any action required or
permitted to be taken at a meeting of the shareholders or of a class of
shareholders may be taken without a meeting if, prior or subsequent to the
action, a consent or consents thereto by all of the shareholders who would be
entitled to vote at a meeting for such purpose shall be filed with the secretary
of the corporation.

                  (b) Partial written consent. Any action required or permitted
to be taken at a meeting of the shareholders or of a class of shareholders may
be taken without a meeting upon the written consent of shareholders who would
have been entitled to cast the minimum number of votes that would be necessary
to authorize the action at a meeting at which all shareholders entitled to vote
thereon were present and voting. The consents shall be filed with the secretary
of the corporation. The action shall not become effective until after at least
ten days' written notice of the action has been given to each shareholder
entitled to vote thereon who has not consented thereto.

                  Section 3.16. MINORS AS SECURITY HOLDERS. The corporation may
treat a minor who holds shares or obligations of the corporation as having
capacity to receive and to empower others to receive dividends, interest,
principal and other payments or distributions, to vote or express consent or
dissent and to make elections and exercise rights relating to such shares or
obligations unless, in the case of payments or distributions on shares, the
corporate officer responsible for maintaining the list of shareholders or the
transfer agent of the corporation or, in the case of payments or distributions
on obligations, the treasurer or paying officer or agent has received written
notice that the holder is a minor.


                                   ARTICLE IV
                               BOARD OF DIRECTORS

                  Section 4.01. POWERS; PERSONAL LIABILITY.

                  (a) General rule. Unless otherwise provided by statute all
powers vested by law in the corporation shall be exercised by or under the
authority of, and the business and affairs of the corporation shall be managed
under the direction of, the board of directors.

                  (b) Standard of care; justifiable reliance. A director shall
stand in a fiduciary relation to the corporation and shall perform his or her
duties as a director, including duties as a member of any committee of the board
upon which the director may serve, in good faith, in a manner the director
reasonably believes to be in the best interests of the corporation and with such
care, including reasonable inquiry, skill and diligence, as a person of ordinary
prudence would use under similar circumstances. In performing his or her duties,
a director shall be entitled to rely in good faith on information, opinions,
reports or statements, including financial statements and other financial data,
in each case prepared or presented by any of the following:

                           (1) One or more officers or employees of the
         corporation whom the director reasonably believes to be reliable and
         competent in the matters presented.


                                       10





                           (2) Counsel, public accountants or other persons as
         to matters which the director reasonably believes to be within the
         professional or expert competence of such person.

                           (3) A committee of the board upon which the director
         does not serve, duly designated in accordance with law, as to matters
         within its designated authority, which committee the director
         reasonably believes to merit confidence.

A director shall not be considered to be acting in good faith if the director
has knowledge concerning the matter in question that would cause his or her
reliance to be unwarranted.

                  (c) Consideration of factors. In discharging the duties of
their respective positions, the board of directors, committees of the board and
individual directors may, in considering the best interests of the corporation,
consider the effects of any action upon employees, upon suppliers and customers
of the corporation and upon communities in which offices or other establishments
of the corporation are located, and all other pertinent factors. The
consideration of those factors shall not constitute a violation of subsection
(b).

                  (d) Presumption. Absent breach of fiduciary duty, lack of good
faith or self-dealing, actions taken as a director or any failure to take any
action shall be presumed to be in the best interests of the corporation.

                  (e) Personal liability of directors.

                           (1) A director shall not be personally liable, as
         such, for monetary damages for any action taken, or any failure to take
         any action, unless:

                                    (i) the director has breached or failed to
                  perform the duties of his or her office under this section;
                  and

                                    (ii) the breach or failure to perform
                  constitutes self-dealing, willful misconduct or recklessness.

                                    (iii) The provisions of paragraph (1) shall
                  not apply to the responsibility or liability of a director
                  pursuant to any criminal statute, or the liability of a
                  director for the payment of taxes pursuant to local, State or
                  Federal law.

                           (2) Notation of dissent. A director who is present at
         a meeting of the board of directors, or of a committee of the board, at
         which action on any corporate matter is taken shall be presumed to have
         assented to the action taken unless his or her dissent is entered in
         the minutes of the meeting or unless the director files a written
         dissent to the action with the secretary of the meeting before the
         adjournment thereof or transmits the dissent in writing to the
         secretary of the corporation immediately after the adjournment of the
         meeting. The right to dissent shall not apply to a director who voted
         in favor of the action. Nothing in this section shall bar a director
         from asserting that minutes of the meeting incorrectly omitted his or
         her dissent if, promptly upon receipt of

                                       11





         a copy of such minutes, the director notifies the secretary in writing,
         of the asserted omission or inaccuracy.

                  Section 4.02. QUALIFICATION AND SELECTION OF DIRECTORS.

                  (a) Qualifications. Each director of the corporation shall be
a natural person of full age who need not be a resident of Pennsylvania or a
shareholder of the corporation.

                  (b) Election of directors. Except as otherwise provided in
these bylaws, directors of the corporation shall be elected by the shareholders.
In elections for directors, voting need not be by ballot, except upon demand
made by a shareholder entitled to vote at the election and before the voting
begins. The candidates receiving the highest number of votes from each class or
group of classes, if any, entitled to elect directors separately up to the
number of directors to be elected by the class or group of classes shall be
elected. If at any meeting of shareholders, directors of more than one class are
to be elected, each class of directors shall be elected in a separate election.

                  (c) Cumulative voting. Unless the articles provide for
straight voting, in each election of directors every shareholder entitled to
vote shall have the right to multiply the number of votes to which the
shareholder may be entitled by the total number of directors to be elected in
the same election by the holders of the class or classes of shares of which his
or her shares are a part and the shareholders may cast the whole number of his
or her votes for one candidate or may distribute them among two or more
candidates.

                  Section 4.03. NUMBER AND TERM OF OFFICE.

                  (a) Number. The number of authorized directors of the
Corporation shall be not less than 1 nor more than 15, fixed from time to time
by the Shareholders. The Directors shall be elected at the annual meeting of the
Shareholders and each Director shall be elected to serve until his successor
shall be elected and shall qualify.

                  (b) Term of office. Each director shall hold office until the
expiration of the term for which he or she was elected arid until a successor
has been selected and qualified or until his or her earlier death, resignation
or removal. A decrease in the number of directors shall not have the effect of
shortening the term of any incumbent director.

                  (c) Resignation. Any director may resign at any time upon
written notice to the corporation. The resignation shall be effective upon
receipt thereof by the corporation or at such subsequent time as shall be
specified in the notice of resignation.

                  Section 4.04. VACANCIES.

                  (a) General rule. Vacancies in the board of directors,
including vacancies resulting from an increase in the number of directors, may
be filled by a majority vote of the remaining members of the board though less
than a quorum, or by a sole remaining director, and each person so selected
shall be a director to serve for the balance of the unexpired term, and until a
successor has been selected and qualified or until his or her earlier death,
resignation or removal.


                                       12





                  (b) Action by resigned directors. When one or more directors
resign from the board effective at a future date, the directors then in office,
including those who have so resigned, shall have power by the applicable vote to
fill the vacancies, the vote thereon to take effect when the resignations become
effective.

                  Section 4.05. REMOVAL OF DIRECTORS.

                  (a) Removal by the shareholders. The entire board of
directors, or any class of the board, or any individual director may be removed
from office without assigning any cause by the vote of shareholders, or of the
holders of a class or series of shares, entitled to elect directors, or the
class of directors. In case the board or a class of the board or any one or more
directors are so removed, new directors may be elected at the same meeting. The
board of directors may be removed at any time with or without cause by the
unanimous vote or consent of shareholders entitled to vote thereon.

                  (b) Removal by the board. The board of directors may declare
vacant the office of a director who has been judicially declared of unsound mind
or who has been convicted of an offense punishable by imprisonment for a term of
more than one year or if, within 60 days after notice of his or her selection,
the director does not accept the office either in writing or by attending a
meeting of the board of directors.

                  (c) Removal of directors elected by cumulative voting. An
individual director shall not be removed (unless the entire board or class of
the board is removed) if sufficient votes are cast against the resolution for
his removal which, if cumulatively voted at an annual or other regular election
of directors, would be sufficient to elect one or more directors to the board or
to the class.

                  Section 4.06. PLACE OF MEETINGS. Meetings of the board of
directors may be held at such place within or without Pennsylvania as the board
of directors may from time to time appoint or as may be designated in the notice
of the meeting.

                  Section 4.07. ORGANIZATION OF MEETINGS. At every meeting of
the board of directors, the chairman of the board, if there be one, or, in the
case of a vacancy in the office or absence of the chairman of the board, one of
the following officers present in the order stated: the vice chairman of the
board, if there be one, the president, the vice presidents in their order of
rank and seniority, or a person chosen by a majority of the directors present,
shall act as chairman of the meeting. The secretary or, in the absence of the
secretary, an assistant secretary, or, in the absence of the secretary and the
assistant secretaries, any person appointed by the chairman of the meeting,
shall act as secretary.

                  Section 4.08. REGULAR MEETINGS. Regular meetings of the board
of directors shall be held at such time and place as shall be designated from
time to time by resolution of the board of directors.

                  Section 4.09. SPECIAL MEETINGS. Special meetings of the board
of directors shall be held whenever called by the chairman or by two or more of
the directors.


                                       13





                  Section 4.10. QUORUM OF AND ACTION BY DIRECTORS.

                  (a) General rule. A majority of the directors in office of the
corporation shall be necessary to constitute a quorum for the transaction of
business and the acts of a majority of the directors present and voting at a
meeting at which a quorum is present shall be the acts of the board of
directors.

                  (b) Action by written consent. Any action required or
permitted to be taken at a meeting of the directors may be taken without a
meeting if, prior or subsequent to the action, a consent or consents thereto by
all of the directors in office is filed with the secretary of the corporation.

                  Section 4.11. EXECUTIVE AND OTHER COMMITTEES.

                  (a) Establishment and powers. The board of directors may, by
resolution adopted by a majority of the directors in office, establish one or
more committees to consist of one or more directors of the corporation. Any
committee, to the extent provided in the resolution of the board of directors,
shall have and may exercise all of the powers and authority of the board of
directors except that a committee shall not have any power or authority as to
the following:

                           (1) The submission to shareholders of any action
         requiring approval of shareholders under the Business Corporation Law.

                           (2) The creation or filling of vacancies in the board
         of directors.

                           (3) The adoption, amendment or repeal of these
         bylaws.

                           (4) The amendment or repeal of any resolution of the
         board that by its terms is amendable or repealable only by the board.

                           (5) Action on matters committed by a resolution of
         the board of directors to another committee of the board.

                  (b) Alternate committee members. The board may designate one
or more directors as alternate members of any committee who may replace any
absent or disqualified member at any meeting of the committee or for the
purposes of any written action by the committee. In the absence or
disqualification of a member and alternate member or members of a committee, the
member or members thereof present at any meeting and not disqualified from
voting, whether or not constituting a quorum, may unanimously appoint another
director to act at the meeting in the place of the absent or disqualified
member.

                  (c) Term. Each committee of the board shall serve at the
pleasure of the board.

                  (d) Committee procedures. The term "board of directors" or
"board," when used in any provision of these bylaws relating to the organization
or procedures of or the manner of taking action by the board of directors, shall
be construed to include and refer to any executive or other committee of the
board.

                                       14


                  Section 4.12. COMPENSATION. The board of directors shall have
the authority to fix compensation of directors for their services as directors
and a director may be a salaried officer of the corporation.


                                    ARTICLE V
                                    OFFICERS

                  Section 5.01. OFFICERS GENERALLY.

                  (a) Number, qualification and designation. The officers of the
corporation shall be a president, a secretary, a treasurer, and such other
officers as may be elected in accordance with the provisions of Section 5.03.
Officers may but need not be directors or shareholders of the corporation. The
president and secretary shall be natural persons of full age. The treasurer may
be a corporation, but if a natural person shall be of full age. The board of
directors may elect from among the members of the board a chairman of the board
and a vice chairman of the board who shall be officers of the corporation. Any
number of offices may be held by the same person.

                  (b) Resignations. Any officer may resign at any time upon
written notice to the corporation. The resignation shall be effective upon
receipt thereof by the corporation or at such subsequent time as may be
specified in the notice of resignation.

                  (c) Bonding. The corporation may secure the fidelity of any or
all of its officers by bond or otherwise.

                  (d) Standard of care. Except as otherwise provided in the
articles, an officer shall perform his or her duties as an officer in good
faith, in a manner he or she reasonably believes to be in the best interests of
the corporation and with such care, including reasonable inquiry, skill and
diligence, as a person of ordinary prudence would use under similar
circumstances. A person who so performs his or her duties shall not be liable by
reason of having been an officer of the corporation.

                  Section 5.02. ELECTION AND TERM OF OFFICE. The officers of the
corporation, except those elected by delegated authority pursuant to Section
5.03, shall be elected annually by the board of directors, and each such officer
shall hold office for a term of one year and until a successor has been selected
and qualified or until his or her earlier death, resignation or removal.

                  Section 5.03. SUBORDINATE OFFICERS, COMMITTEES AND AGENTS. The
board of directors may from time to time elect such other officers and appoint
such committees, employees or other agents as the business of the corporation
may require, including one or more assistant secretaries, and one or more
assistant treasurers, each of whom shall hold office for such period, have such
authority, and perform such duties as are provided in these bylaws or as the
board of directors may from time to time determine. The board of directors may
delegate to any officer or committee the power to elect subordinate officers and
to retain or appoint employees or other agents, or committees thereof and to
prescribe the authority and duties of such subordinate officers, committees,
employees or other agents.


                                       15



                  Section 5.04. REMOVAL OF OFFICERS AND AGENTS. Any officer or
agent of the corporation may be removed by the board of directors with or
without cause. The removal shall be without prejudice to the contract rights, if
any, of any person so removed. Election or appointment of an officer or agent
shall not of itself create contract rights.

                  Section 5.05. VACANCIES. A vacancy in any office because of
death, resignation, removal, disqualification, or any other cause, shall be
filled by the board of directors or by the officer or committee to which the
power to fill such office has been delegated pursuant to Section 5.03, as the
case may be, and if the office is one for which these bylaws prescribe a term,
shall be filled for the unexpired portion of the term.

                  Section 5.06. AUTHORITY. All officers of the corporation, as
between themselves and the corporation, shall have such authority and perform
such duties in the management of the corporation as may be provided by or
pursuant to resolution or orders of the board of directors or in the absence of
controlling provisions in the resolutions or orders of the board of directors,
as may be determined by or pursuant to these bylaws.

                  Section 5.07. THE CHAIRMAN OF THE BOARD. The chairman of the
board if there be one, or in the absence of the chairman, the vice chairman of
the board, shall preside at all meetings of the shareholders and of the board of
directors and shall perform such other duties as may from time to time be
requested by the board of directors.

                  Section 5.08. THE PRESIDENT. The president shall be the chief
executive officer of the corporation and shall have general supervision over the
business and operations of the corporation, subject however, to the control of
the board of directors. The president shall sign, execute, and acknowledge, in
the name of the corporation, deeds, mortgages, contracts or other instruments
authorized by the board of directors, except in cases where the signing and
execution thereof shall be expressly delegated by the board of directors, or by
these bylaws, to some other officer or agent of the corporation; and, in
general, shall perform all duties incident to the office of president and such
other duties as from time to time may be assigned by the board of directors.

                  Section 5.09. THE SECRETARY. The secretary or an assistant
secretary shall attend all meetings of the shareholders and of the board of
directors and shall record all votes of the shareholders and of the directors
and the minutes of the meetings of the shareholders and of the board of
directors and of committees of the board in a book or books to be kept for that
purpose; shall see that notices are given and records and reports properly kept
and filed by the corporation as required by law; shall be the custodian of the
seal of the corporation and see that it is affixed to all documents to be
executed on behalf of the corporation under its seal; and, in general, shall
perform all duties incident to the office of secretary, and such other duties as
may from time to time be assigned by the board of directors or the president.

                  Section 5.10. THE TREASURER. The treasurer or an assistant
treasurer shall have or provide for the custody of the funds or other property
of the corporation; shall collect and receive or provide for the collection and
receipt of moneys earned by or in any manner due to or received by the
corporation; shall deposit all funds in his or her custody as treasurer in such
banks or other places of deposit as the board of directors may from time to time
designate; shall,

                                       16



whenever so required by the board of directors, render an account showing all
transactions as treasurer and the financial condition of the corporation; and,
in general, shall discharge such other duties as may from time to time be
assigned by the board of directors or the president.

                  Section 5.11. SALARIES. The salaries of the officers elected
by the board of directors shall be fixed from time to time by the board of
directors or by such officer as may be designated by resolution of the board.
The salaries or other compensation of any other officers, employees and other
agents shall be fixed from time to time by the officer or committee to which the
power to elect such officers or to retain or appoint such employees or other
agents has been delegated pursuant to Section 5.03. No officer shall be
prevented from receiving such salary or other compensation by reason of the fact
that the officer is also a director of the corporation.

                  Section 5.12. DISALLOWED COMPENSATION. Any payments made to an
officer or employee of the corporation such as a salary, commission, bonus,
interest, rent, travel or entertainment expense incurred by him, which shall be
disallowed in whole or in part as a deductible expense by the Internal Revenue
Service, shall be reimbursed by such officer or employee to the corporation to
the full extent of such disallowance. It shall be the duty of the directors, as
a Board, to enforce payment of each such amount disallowed. In lieu of payment
by the officer or employee, subject to the determination of the directors,
proportionate amounts may be withheld from future compensation payments until
the amount owed to the corporation has been recovered.


                                   ARTICLE VI
                      CERTIFICATES OF STOCK, TRANSFER, ETC.

                  Section 6.01. SHARE CERTIFICATES. Certificates for shares of
the corporation shall be in such form as approved by the board of directors, and
shall state that the corporation is incorporated under the laws of Pennsylvania,
the name of the person to whom issued, and the number and class of shares and
the designation of the series (if any) that the certificate represents. The
share register or transfer books and blank share certificates shall be kept by
the secretary or by any transfer agent or registrar designated by the board of
directors for that purpose.

                  Section 6.02. ISSUANCE. The share certificates of the
corporation shall be numbered and registered in the share register or transfer
books of the corporation as they are issued. They shall be signed by the
president or a vice president and by the secretary or an assistant secretary or
the treasurer or an assistant treasurer, and shall bear the corporate seal,
which may be a facsimile, engraved or printed; but where such certificate is
signed by a transfer agent or a registrar the signature of any corporate officer
upon such certificate may be a facsimile, engraved or printed. In case any
officer who has signed, or whose facsimile signature has been placed upon, any
share certificate shall have ceased to be such officer because of death,
resignation or otherwise, before the certificate is issued, it may be issued
with the same effect as if the officer had not ceased to be such at the date of
its issue. The provisions of this Section 6.02 shall be subject to any
inconsistent or contrary agreement at the time between the corporation and any
transfer agent or registrar.


                                       17



                  Section 6.03. TRANSFER. Transfers of shares shall be made on
the share register or transfer books of the corporation upon surrender of the
certificate therefor, endorsed by the person named in the certificate or by an
attorney lawfully constituted in writing. No transfer shall be made inconsistent
with the provisions of the Uniform Commercial Code, 13 Pa.C.S. Section 8101 et
seq., and its amendments and supplements.

                  Section 6.04. RECORD HOLDER OF SHARES. The corporation shall
be entitled to treat the person in whose name any share or shares of the
corporation stand on the books of the corporation as the absolute owner thereof,
and shall not be bound to recognize any equitable or other claim to, or interest
in, such share or shares on the part of any other person.

                  Section 6.05. LOST, DESTROYED OR MUTILATED CERTIFICATES. The
holder of any shares of the corporation shall immediately notify the corporation
of any loss, destruction or mutilation of the certificate therefor, and the
board of directors may, in its discretion, cause a new certificate or
certificates to be issued to such holder, in case of mutilation of the
certificate, upon the surrender of the mutilated certificate or, in case of loss
or destruction of the certificate, upon satisfactory proof of such loss or
destruction and, if the board of directors shall so determine, the deposit of a
bond in such form and in such sum, and with such surety or sureties, as it may
direct.


                                   ARTICLE VII
                   INDEMNIFICATION OF DIRECTORS, OFFICERS AND
                        OTHER AUTHORIZED REPRESENTATIVES

                  Section 7.01. SCOPE OF INDEMNIFICATION.

                  (a) General rule. The corporation shall indemnify an
indemnified representative against any liability incurred in connection with any
proceeding in which the indemnified representative may be involved as a party or
otherwise by reason of the fact that such person is or was serving in an
indemnified capacity, including, without limitation, liabilities resulting from
any actual or alleged breach or neglect of duty, error, misstatement or
misleading statement, negligence, gross negligence or act giving rise to strict
or products liability, except:

                           (1) where such indemnification is expressly
         prohibited by applicable law;

                           (2) where the conduct of the indemnified
         representative has been finally determined pursuant to Section 7.06 or
         otherwise:

                                    (i) to constitute willful misconduct or
                  recklessness within the meaning of 15 Pa.C.S. Section 513(b)
                  and 1746(b) and 42 Pa.C.S. Section 8365(b) or any superseding
                  provision of law sufficient in the circumstances to bar
                  indemnification against liabilities arising from the conduct;
                  or

                                    (ii) to be based upon or attributable to the
                  receipt by the indemnified representative from the corporation
                  of a personal benefit to which the indemnified representative
                  is not legally entitled; or


                                       18





                           (3) to the extent such indemnification has been
         finally determined in a final adjudication pursuant to Section 7.06 to
         be otherwise unlawful.

                  (b) Partial payment. If an indemnified representative is
entitled to indemnification in respect of a portion, but not all, of any
liabilities to which such person may be subject, the corporation shall indemnify
such indemnified representative to the maximum extent for such portion of the
liabilities.

                  (c) Presumption. The termination of a proceeding by judgment,
order, settlement or conviction or upon a plea of nolo contendere or its
equivalent shall not of itself create a presumption that the indemnified
representative is not entitled to indemnification.

                  (d) Definitions. For purposes of this Article:

                           (1) "indemnified capacity" means any and all past,
         present and future service by an indemnified representative in one or
         more capacities as a director, officer, employee or agent of the
         corporation, or, at the request of the corporation, as a director,
         officer, employee, agent, fiduciary or trustee of another corporation,
         partnership, joint venture, trust, employee benefit plan or other
         entity or enterprise;

                           (2) "indemnified representative" means any and all
         directors and officers of the corporation and any other person
         designated as an indemnified representative by the board of directors
         of the corporation (which may, but need not, include any person serving
         at the request of the corporation, as a director, officer, employee,
         agent, fiduciary or trustee of another corporation, partnership, joint
         venture, trust, employee benefit plan or other entity or enterprise);

                           (3) "liability" means any damage, judgment, amount
         paid in settlement, fine, penalty, punitive damages, excise tax
         assessed with respect to an employee benefit plan, or cost or expense,
         of any nature (including, without limitation, attorneys' fees and
         disbursements); and

                           (4) "proceeding" means any threatened, pending or
         completed action, suit, appeal or other proceeding of any nature,
         whether civil, criminal, administrative or investigative, whether
         formal or informal, and whether brought by or in the right of the
         corporation, a class of its security holders or otherwise.

                  Section 7.02. PROCEEDINGS INITIATED BY INDEMNIFIED
REPRESENTATIVES. Notwithstanding any other provision of this Article, the
corporation shall not indemnify under this Article an indemnified representative
for any liability incurred in a proceeding initiated (which shall not be deemed
to include counter-claims or affirmative defenses) or participated in as an
intervenor or amicus curiae by the person seeking indemnification unless such
initiation of or participation in the proceeding is authorized, either before or
after its commencement, by the affirmative vote of a majority of the directors
in office. This section does not apply to a reimbursement of expenses incurred
in successfully prosecuting or defending an arbitration under Section 7.06 or
otherwise successfully prosecuting or defending the rights of an indemnified
representative granted by or pursuant to this Article.


                                       19





                  Section 7.03. ADVANCING EXPENSES. The corporation shall pay
the expenses (including attorneys' fees and disbursements) incurred in good
faith by an indemnified representative in advance of the final disposition of a
proceeding described in Section 7.01 or the initiation of or participation in
which is authorized pursuant to Section 7.02 upon receipt of an undertaking by
or on behalf of the indemnified representative to repay the amount if it is
ultimately determined pursuant to Section 7.06 that such person is not entitled
to be indemnified by the corporation pursuant to this Article. The financial
ability of an indemnified representative to repay an advance shall not be a
prerequisite to the making of such advance.

                  Section 7.04. SECURING OF INDEMNIFICATION OBLIGATIONS. To
further effect, satisfy or secure the indemnification obligations provided
herein or otherwise, the corporation may maintain insurance, obtain a letter of
credit, act as self-insurer, create a reserve, trust, escrow, cash collateral or
other fund or account, enter into indemnification agreements, pledge or grant a
security interest in any assets or properties of the corporation, or use any
other mechanism or arrangement whatsoever in such amounts, at such costs, and
upon such other terms and conditions as the board of directors shall deem
appropriate. Absent fraud, the determination of the board of directors with
respect to such amounts, costs, terms and conditions shall be conclusive against
all security holders, officers and directors and shall not be subject to
voidability.

                  Section 7.05. PAYMENT OF INDEMNIFICATION. An indemnified
representative shall be entitled to indemnification within 30 days after a
written request for indemnification has been delivered to the secretary of the
corporation.

                  Section 7.06. ARBITRATION.

                  (a) General rule. Any dispute related to the right to
indemnification, contribution or advancement of expenses as provided under this
Article, except with respect to indemnification for liabilities arising under
the Securities Act of 1933 that the corporation has undertaken to submit to a
court for adjudication, shall be decided only by arbitration in the metropolitan
area in which the principal executive offices of the corporation are located at
the time, in accordance with the commercial arbitration rules then in effect of
the American Arbitration Association, before a panel of three arbitrators, one
of whom shall be selected by the corporation, the second of whom shall be
selected by the indemnified representative and third of whom shall be selected
by the other two arbitrators. In the absence of the American Arbitration
Association, or if for any reason arbitration under the arbitration rules of the
American Arbitration Association cannot be initiated, or if one of the parties
fails or refuses to select an arbitrator or if the arbitrators selected by the
corporation and the indemnified representative cannot agree on the selection of
the third arbitrator within 30 days after such time as the corporation and the
indemnified representative have each been notified of the selection of the
other's arbitrator, the necessary arbitrator or arbitrators shall be selected by
the presiding judge of the court of general jurisdiction in such metropolitan
area.

                  (b) Burden of proof. The party or parties challenging the
right of an indemnified representative to the benefits of this Article shall
have the burden of proof.


                                       20



                  (c) Expenses. The corporation shall reimburse an indemnified
representative for the expenses (including attorneys' fees and disbursements)
incurred in successfully prosecuting or defending such arbitration.

                  (d) Effect. Any award entered by the arbitrators shall be
final, binding and nonappealable and judgment may be entered thereon by any
party in accordance with applicable law in any court of competent jurisdiction,
except that the corporation shall be entitled to interpose as a defense in any
such judicial enforcement proceeding any prior final judicial determination
adverse to the indemnified representative under Section 7.01(a)(2) in a
proceeding not directly involving indemnification under this Article. This
arbitration provision shall be specifically enforceable.

                  Section 7.07. CONTRIBUTION. If the indemnification provided
for in this Article or otherwise is unavailable for any reason in respect of any
liability or portion thereof, the corporation shall contribute to the
liabilities to which the indemnified representative may be subject in such
proportion as is appropriate to reflect the intent of this Article or otherwise.

                  Section 7.08. MANDATORY INDEMNIFICATION OF DIRECTORS,
OFFICERS, ETC. To the extent that an authorized representative of the
corporation has been successful on the merits or otherwise in defense of any
action or proceeding referred to in 15 Pa.C.S. Section 1741 or 1742 or in
defense of any claim, issue or matter therein, such person shall be indemnified
against expenses (including attorneys' fees and disbursements) actually and
reasonably incurred by such person in connection therewith.

                  Section 7.09. CONTRACT RIGHTS; AMENDMENT OR REPEAL. All rights
under this Article shall be deemed a contract between the corporation and the
indemnified representative pursuant to which the corporation and each
indemnified representative intend to be legally bound. Any repeal, amendment or
modification hereof shall be prospective only and shall not affect any rights or
obligations then existing.

                  Section 7.10. SCOPE OF ARTICLE. The rights granted by this
Article shall not be deemed exclusive of any other rights to which those seeking
indemnification, contribution or advancement of expenses may be entitled under
any statute, agreement, vote of shareholders or disinterested directors or
otherwise both as to action in an indemnified capacity and as to action in any
other capacity. The indemnification, contribution and advancement of expenses
provided by or granted pursuant to this Article shall continue as to a person
who has ceased to be an indemnified representative in respect of matters arising
prior to such time, and shall inure to the benefit of the heirs, executors,
administrators and personal representatives of such a person.

                  Section 7.11. RELIANCE OF PROVISIONS. Each person who shall
act as an indemnified representative of the corporation shall be deemed to be
doing so in reliance upon the rights provided in this Article.

                  Section 7.12. INTERPRETATION. The provisions of this Article
are intended to constitute bylaws authorized by 15 Pa.C.S. Section 513 and 1746
and 42 Pa.C.S. Section 8365.



                                       21



                                  ARTICLE VIII
                                  MISCELLANEOUS

                  Section 8.01. CORPORATE SEAL. The corporation seal shall have
inscribed thereon the name of the corporation, the year of its organization and
the words "Corporate Seal, Pennsylvania".

                  Section 8.02. CHECKS. All checks, notes, bills of exchange or
other orders in writing shall be signed by such person or persons as the board
of directors or any person authorized by resolution of the board of directors
may from time to time designate.

                  Section 8.03. CONTRACTS.

                  (a) General rule. Excepts as otherwise provided in the
Business Corporation Law in the case of transactions that require action by the
shareholders, the board of directors may authorize any officer or agent to enter
into any contract or to execute or deliver any instrument on behalf of the
corporation, and such authority may be general or confined to specific
instances.

                  (b) Statutory form of execution of instruments. Any note,
mortgage, evidence of indebtedness, contract or other document, or any
assignment or endorsement thereof, executed or entered into between the
corporation and any other person, when signed by one or more officers or agents
having actual or apparent authority to sign it, or by the president or vice
president and secretary or assistant secretary or treasurer or assistant
treasurer of the corporation, shall be held to have been properly executed for
and in behalf of the corporation, without prejudice to the rights of the
corporation against any person who shall have executed the instrument in excess
of his or her actual authority.

                  Section 8.04. INTERESTED DIRECTORS OR OFFICERS; QUORUM.

                  (a) General rule. A contract or transaction between the
corporation and one or more of its directors or officers or between the
corporation and another corporation, partnership, joint venture, trust or other
enterprise in which one or more of its directors or officers are directors or
officers or have a financial or other interest, shall not be void or voidable
solely for that reason, or solely because the director or officer is present at
or participates in the meeting of the board of directors that authorizes the
contract or transaction, or solely because his, her or their votes are counted
for that purpose, if:

                           (1) the material facts as to the relationship or
         interest and as to the contract or transaction are disclosed or are
         known to the board of directors and the board authorizes the contract
         or transaction by the affirmative votes of a majority of the
         disinterested directors even though the disinterested directors are
         less than a quorum;

                           (2) the material facts as to his or her relationship
         or interest and as to the contract or transaction are disclosed or are
         known to the shareholders entitled to vote thereon and the contract or
         transaction is specifically approved in good faith by vote of those
         shareholders; or


                                       22


                           (3) the contract or transaction is fair as to the
         corporation as of the time it is authorized, approved or ratified by
         the board of directors or the shareholders.

                  (b) Quorum. Common or interested directors may be counted in
determining the presence of a quorum at a meeting of the board which authorizes
a contract or transaction specified in subsection (a).

                  Section 8.05. DEPOSITS. All funds of the corporation shall be
deposited from time to time to the credit of the corporation in such banks,
trust companies or other depositaries as the board of directors may approve or
designate, and all such funds shall be withdrawn only upon checks signed by such
one or more officers or employees as the board of directors shall from time to
time determine.

                  Section 8.06. CORPORATE RECORDS.

                  (a) Required records. The corporation shall keep complete and
accurate books and records of account, minutes of the proceedings of the
incorporators, shareholders and directors and a share register giving the names
and addresses of all shareholders and the number and class of shares held by
each. The share register shall be kept at either the registered office of the
corporation in Pennsylvania or at its principal place of business wherever
situated or at the office of its registrar or transfer agent. Any books, minutes
or other records may be in written form or any other form capable of being
converted into written form within a reasonable time.

                  (b) Right of inspection. Every shareholder shall, upon written
verified demand stating the purpose thereof, have a right to examine, in person
or by agent or attorney, during the usual hours for business for any proper
purpose, the share register, books and records of account, and records of the
proceedings of the incorporators, shareholders and directors and to make copies
or extracts therefrom. A proper purpose shall mean a purpose reasonably related
to the interest of the person as a shareholder. In every instance where an
attorney or other agent is the person who seeks the right of inspection, the
demand shall be accompanied by a verified power of attorney or other writing
that authorizes the attorney or other agent to so act on behalf of the
shareholder. The demand shall be directed to the corporation at its registered
office in Pennsylvania or at its principal place of business wherever situated.

                  Section 8.07. FINANCIAL REPORTS. Unless otherwise agreed
between the corporation and a shareholder, the corporation shall furnish to its
shareholders annual financial statements, including at least a balance sheet as
of the end of each fiscal year and a statement of income and expenses for the
fiscal year. The financial statements shall be prepared on the basis of
generally accepted accounting principles, if the corporation prepares financial
statements for the fiscal year on that basis for any purpose, and may be
consolidated statements of the corporation and one or more of its subsidiaries.
The financial statements shall be mailed by the corporation to each of its
shareholders entitled thereto within 120 days after the close of each fiscal
year and, after the mailing and upon written request, shall be mailed by the
corporation to any shareholder or beneficial owner entitled thereto to whom a
copy of the most recent annual financial statements has not previously been
mailed. Statements that are audited or reviewed by a public accountant shall be
accompanied by the report of the accountant; in other cases, each


                                       23


copy shall be accompanied by a statement of the person in charge of the
financial records of the corporation:

                           (1) Stating his reasonable belief as to whether or
         not the financial statements were prepared in accordance with generally
         accepted accounting principles and, if not, describing the basis of
         presentation.

                           (2) Describing any material respects in which the
         financial statements were not prepared on a basis consistent with those
         prepared for the previous year.

                  Section 8.08. AMENDMENT OF BYLAWS. These bylaws may be amended
or repealed, or new bylaws may be adopted, either (i) by vote of the
shareholders at any duly organized annual or special meeting of shareholders, or
(ii) with respect to those matters that are not by statute committed expressly
to the shareholders and regardless of whether the shareholders have previously
adopted or approved the bylaw being amended or repealed, by vote of a majority
of the board of directors of the corporation in office at any regular or special
meeting of directors. Any change in these bylaws shall take effect when adopted
unless otherwise provided in the resolution effecting the change. See Section
2.03(b) (relating to notice of action by shareholders on bylaws).

                               * * * * * * * * * *

                  Section 8.09. CAPITALIZATION AND EXPENSING OF ASSETS. The
procedure for capitalizing and expensing of assets will follow the Medicare
Regulations. "If a depreciable asset has at the time of its acquisition an
estimated useful life of at least two years and a cost of at least $500.00, the
asset must be capitalized and written off readably over the estimated useful
life of the asset. If the cost of the asset (including taxes and shipping) is
less than $500.00, or if the asset has a useful life of less than two years, its
cost will be expensed in the year of acquisition."



                                       24

EX-3.5

                                                                     EXHIBIT 3.5

                          ARTICLES OF ORGANIZATION FOR
                        FLORIDA LIMITED LIABILITY COMPANY


                                    ARTICLE I
                                      NAME

                  The name of the Limited Liability Company is: Alpine Health
and Rehabilitation Center, LLC.

                                   ARTICLE II
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee,
Wisconsin 53203.

                                   ARTICLE III
                                    DURATION

                  The period of duration for the Limited Liability Company shall
be: Unlimited/Perpetual.

                                   ARTICLE IV
                                   MANAGEMENT

                  The Limited Liability Company is to be managed by the members
and the name and address of the managing member is: Northern Health Facilities,
Inc., 111 West Michigan Street, Milwaukee, Wisconsin 53203.

                                    ARTICLE V
                         ADMISSION OF ADDITIONAL MEMBERS

                  The right, if given, of the members to admit additional
members and the terms and conditions of the admissions shall be: N/A.

                                   ARTICLE VI
                       MEMBERS RIGHTS TO CONTINUE BUSINESS

                  The right, if given, of the remaining members of the limited
liability company to continue the business on the death, retirement,
resignation, expulsion, bankruptcy, or dissolution of a member or the occurrence
of any other event which terminates the continued membership of a member in the
limited liability company shall be: None.

EX-3.6

                                                                     EXHIBIT 3.6

                            ARTICLES OF ORGANIZATION
                                       FOR
                        FLORIDA LIMITED LIABILITY COMPANY

                                   ARTICLE I.
                                      NAME

                  The name of the Limited Liability Company is: Arbors at
Bayonet Point, LLC.

                                   ARTICLE II.
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee, WI
53203

                                  ARTICLE III.
                     REGISTERED AGENT, REGISTERED OFFICE, &
                          REGISTERED AGENT'S SIGNATURE

                  The name and the Florida street address of the registered
agent are:

                          Lexis Document Services, Inc.
                               3953 WW Kelley Road
                              Tallahassee, FL 32311

EX-3.7

                                                                     EXHIBIT 3.7

                            ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


                  The undersigned, desiring to form a limited liability Company,
under Chapter 1705 of the Ohio Revised Code, do hereby state the following:

                  FIRST: The name of said limited liability company shall be:
Arbors at Fairlawn Care, LLC.

                  SECOND: This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD: The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.8

                                                                     EXHIBIT 3.8


                  AMENDED AND RESTATED ARTICLES OF ORGANIZATION


         FIRST: The name of said limited liability company shall be: Arbors at
Fairlawn Realty OH, LLC.

         SECOND: This limited liability company shall exist for a period of
unlimited/perpetual.

         THIRD: The address to which interested persons may direct requests for
copies of any operating agreement and any bylaws of this limited liability
company is: 111 West Michigan Street, Milwaukee, Wisconsin, 53203.

         FOURTH: None.

         FIFTH:

         1. The LLC shall be a "sole asset entity" as required by the Secretary
of Housing and Urban Development, whose sole asset shall be Arbors at Fairlawn
located at 575 South Cleveland-Massillon, Fairlawn, Summit County, Ohio
("Project").

         2. The LLC shall not be voluntarily dissolved prior to December 31,
2040.

         3. Notwithstanding anything else to the contrary stated in the Articles
of Organization, the LLC shall not indemnify any member except where applicable
state law requires such indemnification.

         Notwithstanding any other provision in the Articles of Organization to
the contrary, as long as the Secretary of the Department of Housing and Urban
Development ("Secretary") or the Secretary's successors or assigns is the
insurer or holder of the note secured by the mortgage on the Project.

         AMENDMENTS. No amendment to the Articles of Organization that result in
any of the following will have any force or effect without the prior written
consent of the Secretary:

         (a)      Any amendment that modifies the term of the LLC;

         (b)      Any amendment that activates the requirement that a HUD
                  previous participation certification be obtained from any
                  additional Member;

         (c)      Any amendment that in any way affects the note, mortgage, or
                  security agreement on the Project or the Regulatory Agreement
                  between HUD and the LLC (the "Regulatory Agreement");

         (d)      Any amendment that would authorize any Member other than the
                  sole member or managing member to bind the LLC for all matters
                  concerning the Project with required HUD's consent or
                  approval;




         (e)      A change in the members of the LLC;

         (f)      Any change in the guarantor(s) of any obligation to the
                  Secretary; or

         (g)      Any amendment to these Articles of Organization.

         AUTHORITY OF LLC. The LLC is authorized to execute a note, mortgage and
security agreement in order to secure a loan to be insured by the Secretary and
to execute the Regulatory Agreement and other documents required in connection
with the HUD-insured loan.

         NEW MEMBERS. No person shall become a Member with at least a 25%
financial interest unless s/he meet the applicable requirements for HUD previous
participation clearance. A Member may neither be added or substituted without
the prior written approval of the Secretary. Any incoming Member shall, as a
condition of receiving an interest in the LCC, agree to be bound by the note,
mortgage, security agreement, the Regulatory Agreement and any other documents
required in connection with the HUD-insured loan to the same extent and on the
same terms as the other Members.

         TRANSFERS UPON DISSOLUTION. Notwithstanding any other provisions of
these Articles of Organization, upon any dissolution, no title, or right to
possession and control of the Project, and no right to collect the rents from
the Project, shall pass to any Person who is not bound by the Regulatory
Agreement in a manner satisfactory to the Secretary.

         CONFLICTS WITH NOTE OR REGULATORY AGREEMENT. Notwithstanding any other
provisions of the Articles of Organization, in the event that any provision of
this Article of Organization conflicts with the Regulatory Agreement, the
provision of the Regulatory Agreement shall control.

         NO VOLUNTARY DISASSOCIATION. So long as the Secretary's successors or
assigns is the insurer or holder of the note on the Project, the LLC may not
voluntarily be dissolved or disassociated or changed to another type of entity
without the prior written approval of the Secretary, and any Member may not be
voluntarily changed to a limited liability company or partnership.

         PERSONAL LIABILITY. The Member(s), and any assignee of a Member, agree
to be liable in their individual capacities to HUD with respect to the following
matters:

         (a)      For funds or property of the Project coming into their hands,
                  which by the provisions of the Regulatory Agreement, they are
                  not entitled to retain; and

         (b)      For their own acts and deeds, or acts and deeds of others
                  which they have authorized, in violation of the provisions of
                  the Regulatory Agreement.

         (c)      For their acts which violate statutes governing the conduct of
                  owners of multifamily projects with FHA-insured mortgages.



                                       2


         LLC REPRESENTATIVES. Each Member is authorized to represent and bind
the LLC with respect to all matters concerning the Project which require the
consent or approval of the Secretary. The signature of any one Member shall bind
the LLC in all such matters. If the LLC representatives under this article XIII
are changed at any time, the LLC shall provide the Secretary with written
notification of the name, address and telephone number of the new
representative(s) within three (3) business days of such change.




                                       3

EX-3.9

                                                                     EXHIBIT 3.9


                            ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


                  The undersigned, desiring to form a limited liability Company,
under Chapter 1705 of the Ohio Revised Code, do hereby state the following:

                  FIRST: The name of said limited liability company shall be:
Arbors at Sylvania Care, LLC.

                  SECOND: This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD: The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.10

                                                                    EXHIBIT 3.10

                  AMENDED AND RESTATED ARTICLES OF ORGANIZATION


                  FIRST: The name of said limited liability company shall be:
Arbors at Sylvania Realty OH, LLC.

                  SECOND: This limited liability company shall exist for a
period of unlimited/perpetual.

                  THIRD: The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin, 53203.

                  FOURTH: None.

                  FIFTH:

                  1. The LLC shall be a "sole asset entity" as required by the
Secretary of Housing and Urban Development, whose sole asset shall be Arbors
Sylvania located at 7120 Port Sylvania Drive, Toledo, Lucas County, Ohio
("Project").

                  2. The LLC shall not be voluntarily dissolved prior to
December 31, 2040.

                  3. Notwithstanding anything else to the contrary stated in the
Articles of Organization, the LLC shall not indemnify any member except where
applicable state law requires such indemnification.

                  Notwithstanding any other provision in the Articles of
Organization to the contrary, as long as the Secretary of the Department of
Housing and Urban Development ("Secretary") or the Secretary's successors or
assigns is the insurer or holder of the note secured by the mortgage on the
Project.

                  AMENDMENTS. No amendment to the Articles of Organization that
result in any of the following will have any force or effect without the prior
written consent of the Secretary:

                  (a)      Any amendment that modifies the term of the LLC;

                  (b)      Any amendment that activates the requirement that a
                           HUD previous participation certification be obtained
                           from any additional Member;

                  (c)      Any amendment that in any way affects the note,
                           mortgage, or security agreement on the Project or the
                           Regulatory Agreement between HUD and the LLC (the
                           "Regulatory Agreement");

                  (d)      Any amendment that would authorize any Member other
                           than the sole member or managing member to bind the
                           LLC for all matters concerning the Project with
                           required HUD's consent or approval;









                  (e)      A change in the members of the LLC;

                  (f)      Any change in the guarantor(s) of any obligation to
                           the Secretary; or

                  (g)      Any amendment to these Articles of Organization.

                  AUTHORITY OF LLC. The LLC is authorized to execute a note,
mortgage and security agreement in order to secure a loan to be insured by the
Secretary and to execute the Regulatory Agreement and other documents required
in connection with the HUD-insured loan.

                  NEW MEMBERS. No person shall become a Member with at least a
25% financial interest unless s/he meet the applicable requirements for HUD
previous participation clearance. A Member may neither be added or substituted
without the prior written approval of the Secretary. Any incoming Member shall,
as a condition of receiving an interest in the LCC, agree to be bound by the
note, mortgage, security agreement, the Regulatory Agreement and any other
documents required in connection with the HUD-insured loan to the same extent
and on the same terms as the other Members.

                  TRANSFERS UPON DISSOLUTION. Notwithstanding any other
provisions of these Articles of Organization, upon any dissolution, no title, or
right to possession and control of the Project, and no right to collect the
rents from the Project, shall pass to any Person who is not bound by the
Regulatory Agreement in a manner satisfactory to the Secretary.

                  CONFLICTS WITH NOTE OR REGULATORY AGREEMENT. Notwithstanding
any other provisions of the Articles of Organization, in the event that any
provision of this Article of Organization conflicts with the Regulatory
Agreement, the provision of the Regulatory Agreement shall control.

                  NO VOLUNTARY DISASSOCIATION. So long as the Secretary's
successors or assigns is the insurer or holder of the note on the Project, the
LLC may not voluntarily be dissolved or disassociated or changed to another type
of entity without the prior written approval of the Secretary, and any Member
may not be voluntarily changed to a limited liability company or partnership.

                  PERSONAL LIABILITY. The Member(s), and any assignee of a
Member, agree to be liable in their individual capacities to HUD with respect to
the following matters:

                  (a)      For funds or property of the Project coming into
                           their hands, which by the provisions of the
                           Regulatory Agreement, they are not entitled to
                           retain; and

                  (b)      For their own acts and deeds, or acts and deeds of
                           others which they have authorized, in violation of
                           the provisions of the Regulatory Agreement.

                  (c)      For their acts which violate statutes governing the
                           conduct of owners of multifamily projects with
                           FHA-insured mortgages.

                                       2







                  LLC REPRESENTATIVES. Each Member is authorized to represent
and bind the LLC with respect to all matters concerning the Project which
require the consent or approval of the Secretary. The signature of any one
Member shall bind the LLC in all such matters. If the LLC representatives under
this article XIII are changed at any time, the LLC shall provide the Secretary
with written notification of the name, address and telephone number of the new
representative(s) within three (3) business days of such change.


                                       3

EX-3.11

                                                                    EXHIBIT 3.11


                            ARTICLES OF ORGANIZATION
                                       FOR
                        FLORIDA LIMITED LIABILITY COMPANY

                                   ARTICLE I.
                                      NAME

       The name of the Limited Liability Company is:  Arbors at Tampa, LLC.


                                   ARTICLE II.
                                     ADDRESS

  The mailing address and street address of the principal office of the Limited
Liability Company is: 111 West Michigan Street, Milwaukee, WI 53203

                                  ARTICLE III.
                     REGISTERED AGENT, REGISTERED OFFICE, &
                          REGISTERED AGENT'S SIGNATURE

      The name and the Florida street address of the registered agent are:


                          Lexis Document Services, Inc.
                               3953 WW Kelley Road
                              Tallahassee, FL 32311

EX-3.12

                                                                    EXHIBIT 3.12

                            ARTICLES OF INCORPORATION
                                       OF
                             ARBORS AT TOLEDO, INC.

                  The undersigned, desiring to form a corporation for profit
(hereinafter referred to as the "Corporation") in accordance with Chapter 1701
of the Ohio Revised Code (hereinafter referred to as the "ORC") hereby states as
follows:

                  1. Name. The name of the Corporation is Arbors at Toledo, Inc.

                  2. Principal Office. The place in the State of Ohio where the
principal office of the Corporation is to be located is in the City of Lime,
County of Allen.

                  3. Purpose. The purpose for which the Corporation is formed is
to engage in any lawful act or activity for which corporations may be formed
under Sections 1701.01 to 1701.98, inclusive, of the ORC.

                  4. Authorized Shares. The number of shares that the
Corporation is authorized to have outstanding is Seven Hundred Fifty (750),
which shall be common shares without par value.

EX-3.13

                                                                    EXHIBIT 3.13

                               CODE OF REGULATIONS
                                       OF
                             ARBORS AT TOLEDO, INC.


                                    ARTICLE I
                                     Offices

                  Section 1. Principal Office. The principal office of the
corporation shall be at such place in the City of Lima, Ohio, as may be
designated from time to time by the Board of Directors.

                  Section 2. Other Offices. The corporation shall also have
offices at such other places within, as well as without, the State of Ohio as
the Board of Directors may from time to time determine.

                                   ARTICLE II
                            Meetings of Shareholders

                  Section 1. Annual Meeting. The annual meeting of the
shareholders of this corporation for the purpose of fixing or changing the
number of directors of the corporation, electing directors and transacting such
other business as may properly come before the meeting, shall be held on the
first Monday of the fourth month following the close of each fiscal year of the
corporation, if not a legal holiday, but if a legal holiday, then on the next
business day following, or on such other day or date as shall be designated by
the Board of Directors.

                  Section 2. Special Meetings. Special meetings of the
shareholders may be called at any time by the President or a Vice President, a
majority of the Board of Directors acting with or without a meeting, or the
holder or holders of one-fourth of all shares outstanding and entitled to vote
thereat.

                  Section 3. Place of Meetings. Meetings of shareholders shall
be held at the office of the corporation in the City of Lima, Ohio, unless the
Board of Directors decides that a meeting shall be held at some other place
within or without the State of Ohio and causes the notice thereof to so state.

                  Section 4. Notice of Meetings. Unless waived, a written,
printed or typewritten notice of each annual or special meeting stating the day,
hour and place and the purpose or purposes thereof shall be served upon or
mailed to each shareholder of record (a) as of the day next preceding the day on
which notice is given or (b) if a record date therefore is duly fixed, of record
as of said date. Such notice shall be given not more than sixty (60) days nor
less than seven (7) days before any such meeting. If mailed, it shall be
directed to a shareholder at his address as the same appears upon the record of
the corporation.

                  All notices with respect to any shares of record in the names
of two or more persons may be given to whichever of such persons is named first
on the books of the corporation and notice so given shall be effective as to all
the holders of record of such shares.




                  Every person who by operation of law, transfer, or otherwise
shall become entitled to any share or right or interest therein shall be bound
by every notice in respect of such share that, prior to his name and address
being entered upon the books of the corporation as the registered holder of such
share, shall have been given to the person in whose name such share appeared of
record.

                  Section 5. Waiver of Notice. Any shareholder, either before or
after any meeting, may waive any notice required to be given by law or under
these Regulations; and whenever all of the shareholders entitled to vote shall
be valid for all purposes without call or notice, and at such meeting any action
may be taken.

                  Section 6. Quorum. The shareholders present in person or by
proxy at any meeting for the determination of the number of directors, or the
election of directors, or for the consideration and action upon reports required
to be laid before such meeting, shall constitute a quorum.

                  At any meeting called for any other purpose, the holders of
shares entitling them to exercise a majority of the voting power of the
corporation, present in person or represented by proxy, shall constitute a
quorum, except when a greater proportion is required by law, the Articles of
Incorporation or these Regulations.

                  At any meeting at which a quorum is present, all questions and
business that shall come before the meeting shall be determined by the vote of
the holders of a majority of such voting shares as are represented in person or
by proxy, except when a greater proportion is required by law, these
Regulations, or the Articles of Incorporation.

                  At any meeting, whether a quorum is present or not, the
holders of a majority of the voting shares represented by shareholders present
in person or by proxy may adjourn from time to time and from place to place
without notice other than by announcement at the meeting. At any such adjourned
meeting at which a quorum is present, any business may be transacted which might
be transacted at the meeting as originally notified or held.

                  Section 7. Voting. At any meeting of shareholders, each
shareholder of the corporation shall, except as otherwise provided by law or by
the Articles of Incorporation or by these Regulations, be entitled to one vote
in person or by proxy for each share of the corporation registered in his name
on the books of the corporation (1) on the date fixed pursuant to subparagraph
(f) of Section 2 of Article IV of these Regulations as the record date for the
determination of shareholders entitled to vote at such meeting, notwithstanding
the prior or subsequent sale, or other disposal of such share or shares or
transfer of the same on the books of the corporation on or after the date so
fixed, or (2) if no such record date shall have been fixed, then at the time of
such meeting.

                  Section 8. Financial Reports. At the annual meeting of
shareholders, or the meeting held in lieu thereof, there shall be laid before
the shareholders a financial statement consisting of: (1) a balance sheet
containing a summary of the assets, liabilities, stated capital, and surplus
(showing separately any capital surplus arising from unrealized appreciation of
assets, other capital surplus, and earned surplus) of the corporation as of a
date not more than


                                       2

four (4) months before such meeting; if such meeting is an adjourned meeting,
said balance sheet may be as of a date not more than four (4) months before the
date of the meeting as originally convened; and (2) a statement of profit and
loss and surplus, including a summary of profits, dividends paid, and other
changes in the surplus accounts of the corporation for the period commencing
with the date marking the end of the period for which the last preceding
statement of profit and loss under this section was made and ending with the
date of said balance sheet. An opinion signed by the President or a Vice
President or the Treasurer or an Assistant Treasurer, or by a public accountant
or firm of public accountants, shall be appended to such financial statement,
stating that the financial statement presents fairly the corporation's financial
position and the results of its operations In conformity with generally accepted
accounting principles applied on a basis consistent with that of the preceding
period, or such other opinion as is in accordance with sound accounting
practice.

                  Section 9. Action Without Meeting. Any action which may be
authorized or taken at any meeting of shareholders may be authorized or taken
without a meeting in a writing or writings signed by all of the holders of
shares who would be entitled to notice of a meeting of the shareholders held for
such purpose. Such writing or writings shall be filed with or entered upon the
records of the corporation.

                                   ARTICLE III
                                    Directors

                  Section 1. Number of Directors. The number of authorized
Directors of the Corporation shall be not less than 1 nor more than 15, fixed
from time to time by the shareholder. The Directors shall be elected at the
annual meeting of the shareholders and each Director shall be elected to serve
until his successor shall be elected and shall qualify.

                  Section 2. Election of Directors. Directors shall be elected
at the annual meeting of shareholders, but when the annual meeting is not held
or directors are not elected thereat, they may be elected at a special meeting
called and held for that purpose. Such election shall be by ballot whenever
requested by any shareholder entitled to vote at such election; but, unless such
a request is made, the election may be conducted in any manner approved at such
meeting.

                  At each meeting of shareholders for the election of directors,
the persons receiving the greatest number of votes shall be directors.

                  Section 3. Term of Office. Directors shall hold office until
the annual meeting next succeeding their election and until their successors are
elected and qualified.

                  Section 4. Vacancies. Vacancies in the Board of Directors may
be filled by a majority vote of the remaining directors until an election to
fill such vacancies is had. Shareholders entitled to elect directors shall have
the right to fill any vacancy in the board (whether the same has been
temporarily filled by the remaining directors or not) at any meeting of the
shareholders called for that purpose, and any directors elected at any such
meeting of shareholders shall serve until the next annual election of directors
and until their successors are elected and qualified.




                                       3

                                   ARTICLE IV
           Powers, Meetings, Compensation, and Conflicts of Directors

                  Section 1. General Powers of Board. The powers of the
corporation shall be exercised, its business and affairs conducted, and its
property controlled by the Board of Directors, except as otherwise provided in
the Articles of Incorporation, amendments thereto, or the Ohio General
Corporation Law.

                  Section 2. Other Powers. Without prejudice to the general
powers conferred by or implied in the preceding section, the directors, acting
as a Board, shall have powers:

                  (a) To fix, define and limit the powers and duties of all
officers and to fix the salaries of all officers;

                  (b) To appoint, and at their discretion, with or without
cause, to remove, or suspend, such subordinate officers, assistants, managers,
agents and employees as the directors may from time to time deem advisable, and
to determine their duties and fix their compensation;

                  (c) To require any officer, agent or employee of the
corporation to furnish a bond for faithful performance In such amount and with
such sureties as the Board may approve;

                  (d) To designate a depository or depositories of the funds of
the corporation and the officer or officers or other persons who shall be
authorized to sign notes, checks, drafts, contracts, deeds, mortgages and other
instruments on behalf of the corporation;

                  (e) To appoint and remove transfer agents and/or registrars
for the corporation's shares;

                  (f) To fix a time not exceeding sixty days preceding the date
of any meeting of shareholders, or the date fixed for the payment of any
dividend or distribution, or the date for the allotment of rights, or (subject
to contract rights with respect thereto) the date when any change or conversion
or exchange of shares shall be made or go into effect, as a record date for the
determination of the shareholder entitled to notice of and to vote at any such
meeting, or entitled to receive payment of any such dividend, distribution, or
allotment of rights, or to exercise the rights in respect to any such change,
conversion or exchange of shares, and, in such case, only the persons who are
shareholders of record on the date so fixed shall be entitled to notice of and
to vote at such meeting, or to receive payment of such dividend, distribution,
or allotment of rights, or to exercise such rights, as the case may be,
notwithstanding any transfer of any shares on the books of the corporation after
any record date fixed as aforesaid, or change of ownership of any shares either
before or after such record date, and such persons shall conclusively be deemed
to be the shareholders of the corporation on such record date, notwithstanding
notice or knowledge to the contrary; and the Board of Directors may close the
books of the corporation against transfer of shares during the whole or any part
of such period; and

                  (g) To establish such rules and regulations respecting the
issuance and transfer of shares and certificates for shares as the Board of
Directors may consider reasonable.




                                       4

                  Section 3. Meetings of the Board. A meeting of the Board of
Directors shall be held immediately following the adjournment of each
shareholders' meeting at which directors are elected, and notice of such meeting
need not be given. The Board of Directors may, by by-laws or resolution, provide
for other meetings of the Board.

                  Special meetings of the Board of Directors may be held at any
time upon call of the President, a Vice President, or any two members of the
Board. Notice of any special meeting of the Board of Directors shall be mailed
to each director, addressed to him at his residence or usual place of business,
at least five (5) days before the day on which the meeting is to be held, or
shall be sent to him at such place by telegram or the equivalent, or be given
personally or by telephone, not later than the day before the day on which the
meeting is to be held. Every such notice shall state the time and place of the
meeting but need not state the purposes thereof. Notice of any meeting of the
Board need not be given to any director, however, if waived by him in writing or
by telegram or the equivalent, whether before or after such meeting be held, or
if he shall be present at such meeting; and any meeting of the Board shall be a
legal meeting without any notice thereof having been given if all the directors
shall be present thereat.

                  At meetings of the Board shall be held at the office of the
corporation in the City of Lima, Ohio, or at such other place, within or without
the State of Ohio, as the Board may determine from time to time and as may be
specified in the notice thereof.

                  Section 4. Quorum. A majority of the Board of Directors shall
constitute a quorum for the transaction of business, provided that whenever less
than a quorum is present at the time and place appointed for any meeting of the
Board, a majority of those present may adjourn the meeting from time to time,
without notice other than by announcement at the meeting, until a quorum shall
be present.

                  Section 5. Action Without Meeting. Any action which may be
authorized or taken at a meeting of the directors may be authorized or taken
without a meeting in a writing or writings signed by all the directors, which
writing or writings shall be filed with or entered upon the records of the
corporation.

                  Section 6. Compensation. The directors, as such, shall not
receive any salary for their services, but by resolution of the Board, a fixed
sum and expenses of attendance, if any, may be allowed that nothing herein
contained shall be construed to preclude any director from serving the
corporation in any other capacity and receiving compensation therefor. Members
of the executive committee or of any standing or special committee may by
resolution of the Board be allowed such compensation for their services as the
Board may deem reasonable, and additional compensation may be allowed to
directors for special services rendered.

                  Section 7. Conflicts. A director of this corporation shall not
be disqualified by his office from dealing or contracting with the corporation
as a vendor, purchaser, employee, agent, attorney, or otherwise, nor shall any
transaction or contract or act of this corporation be void or voidable or in any
way affected or invalidated by reason of the fact that any director, or any firm
of which any director is a member, or any corporation of which any director is a
shareholder, officer, or director, is in any way interested in such transaction
or contract or act, provided the fact that such director or such firm or such
corporation is so interested shall be


                                       5

disclosed or shall be known to the Board of Directors or such members thereof as
shall be present at any meeting of the Board of Directors at which action upon
any such contract or transaction or act shall be taken. No such director shall
be accountable to or responsible to the corporation for or in respect to any
such transaction or contract or act of this corporation or for any gains or
profits realized by him by reason of the fact that he, or any firm of which he
is a member, or any corporation of which he is a shareholder, officer, or
director, is interested in such transaction or contract or act. Any director may
be counted in determining the existence of a quorum at any meeting of the Board
of Directors that shall authorize or take action in respect to any such contract
or transaction or act, and may vote thereat to authorize, ratify, or approve any
such contract or transaction or act. Any officer of the corporation may take any
action within the scope of his authority respecting any such contract or
transaction or act with like force and effect as if he or any firm of which he
is a member or any corporation of which he is a shareholder, officer, or
director were not interested In such transaction or contract or act. Without
limiting or qualifying the foregoing, if in any judicial or other inquiry, suit,
cause or proceeding, the question of whether a director or officer of the
corporation has acted in good faith is material, then notwithstanding any
statute or rule of law or of equity to the contrary (if any there be), his good
faith shall be presumed in the absence of proof to the contrary by clear and
convincing evidence.

                  Section 8. Indemnification. Each person who at any time is or
shall have been a director, officer, employee or agent of the corporation, or is
or shall have been serving at the request of the corporation as a director,
trustee, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, and his or her heirs, executors and
administrators, shall be indemnified by the corporation against any cost or
expense reasonably incurred by him or her in connection with any threatened,
pending, or completed action, suit or proceeding by reason of such service to or
for the corporation in accordance with and to the full extent permitted by the
Ohio General Corporation Law (Ohio Rev. Code Subsection 1701.13(E)) as in effect
at the time of the adoption of these Regulations or as amended from time to time
thereafter. The foregoing right of indemnification shall not be deemed exclusive
of other rights to which any director, officer, employee, agent or other person
may be entitled in any capacity as a matter of law or under any regulation,
agreement, vote of directors or otherwise. The corporation, its directors,
officers, employees and agents shall be fully protected in taking any action or
making any payment under this section, or in refusing so to do, in reliance upon
the advice of counsel. If authorized by the Board of Directors, the corporation
may purchase and maintain insurance against liability on behalf of any such
person to the full extent permitted by law in effect at the time of the adoption
of these Regulations or as changed from time to time.

                  Section 9. Reliance on Books and Records. Each officer,
director or member of any committee designated by the Board of Directors of the
corporation shall, in the performance of his duties, be fully protected in
relying in good faith upon the books of account or reports made to the
corporation by any of its officials or by an independent public accountant or by
an appraiser selected with reasonable care by the Board of Directors of the
corporation or by any such committee or in relying in good faith upon other
records of the corporation.

                  Section 10. By-laws. For the government of its actions, the
Board of Directors may adopt regulation consistent with the Articles of
Incorporation and these Regulations.




                                       6

                  Section 11. Committees. The Board of Directors may by
resolution provide for such standing or special committees as it deems
desirable, and discontinue the same at pleasure. Each such committee shall have
such powers and perform such duties, not inconsistent with law, as may be
delegated to it by the Board of Directors. Vacancies in such committees shall be
filled by the Board of Directors or as it may provide.

                                    ARTICLE V
                                    Officers

                  Section 1. General Provisions. The Board of Directors shall
elect a President, such number of Vice Presidents as the Board may from time to
time determine, a Secretary and Treasurer, and, in its discretion, a Chairman of
the Board of Directors. The Board of Directors may from time to time create such
offices and appoint such other officers, subordinate officers and assistant
officers as it may determine. Any two or more of such offices, other than that
of President and Vice President, Secretary and Assistant Secretary, or Treasurer
and Assistant Treasurer, may be held by the same person, but no officer shall
execute, acknowledge or verify any instrument in more than one capacity.

                  Section 2. Term of Office. The officers of the corporation
shall held office during the pleasure of the Board of Directors, and unless
sooner removed by the Board of Directors, until the reorganization meeting of
the Board of Directors following the date of their election and until their
successors are chosen and qualified. The Board of Directors may remove any
officer at any time, with or without cause, by a majority vote. A vacancy in any
office, however created, shall be filled by the Board of Directors.

                                   ARTICLE VI
                               Duties of Officers

                  Section 1. Chairman of the Board. The Chairman of the Board,
if one be elected, shall preside at all meetings of the Board of Directors and
shall have such other powers and duties as may be prescribed by the Board of
Directors.

                  Section 2. President. The President shall be the chief
executive officer of the corporation and shall exercise supervision over the
business of the corporation and over its several officers, subject, however, to
the control of the Board of Directors. He shall preside at all meetings of
shareholders and, in the absence of, or if a Chairman of the Board shall not
have been elected, shall also preside at meetings of the Board of Directors. He
shall have authority to sign all certificates for shares and all deeds,
mortgages, bonds, contracts, notes and other instruments requiring his
signature; and shall have all the powers and duties prescribed by the Ohio
general corporation law and such others as the Board of Directors may from time
to time assign to him.

                  Section 3. Vice Presidents. The Vice Presidents shall perform
such duties as are conferred upon them by these regulations or as may from time
to time be assigned to them by the Board of Directors or the President. At the
request of the President, or in his absence or disability, the Vice President,
designated by the President (or in the absence of such designation, the Vice
President designated by the Board), shall perform all the duties of the
President, and


                                       7

when so acting, shall have all the powers of the President. The authority of
Vice Presidents to sign in the name of the corporation all certificates for
shares and authorized deeds, mortgages, bonds, contracts, notes and other
instruments, shall be coordinate with like authority of the President. Any one
or more of the Vice Presidents may be designated as "Executive Vice President."

                  Section 4. Secretary. The Secretary shall keep minutes of all
the proceedings of the shareholders and Board of Directors, and shall make
proper record of the same, which shall be attested by him; sign all certificates
for shares, and all deeds, mortgages, bonds, contracts, notes, and other
instruments executed by the corporation requiring his signature; give notice of
meetings of shareholders and directors; produce on request at each meeting of
shareholders for the election of directors a certified list of shareholders
arranged in alphabetical order; keep such books as may be required by the Board
of Directors, and file all reports to States, to the Federal Government, and to
foreign countries; and perform such other and further duties as may from time to
time be assigned to him by the Board of Directors or by the President.

                  Section 5. Treasurer. The Treasurer shall have general
supervision of all finances; he shall receive and have in charge all money,
bills, notes, deeds, leases, mortgages and similar property belonging to the
corporation, and shall do with the same as may from time to time be required by
the Board of Directors. He shall cause to be kept adequate and correct accounts
of the business transactions of the corporation, including accounts of the
assets, liabilities, receipts, disbursements, gains, losses, stated capital, and
shares, together with such other accounts as may be required, and, upon the
expiration of his term of office, shall turn over to his successor or to the
Board of Directors all property, books, papers and money of the corporation in
his hands; and he shall perform such other duties as from time to time may be
assigned to him by the Board of Directors.

                  Section 6. Assistant and Subordinate Officers. The Board of
Directors may appoint such assistant and subordinate officers as it may deem
desirable. Each such officer shall hold office during the pleasure of the Board
of Directors, and perform such duties as the Board of Directors may prescribe.
The Board of Directors may, from time to time, authorize any officer to appoint
and remove assistant and subordinate officers, to prescribe their authority and
duties, and to fix their compensation.

                  Section 7. Duties of Officers May Be Delegated. In the absence
of any officer of the corporation, or for any other reason the Board of
Directors may deem sufficient, the Board of Directors may delegate, for the time
being, the powers or duties, or any of them, of such officer to any other
officer, or to any director.

                                   ARTICLE VII
                             Certificates for Shares

                  Section 1. Form and Execution. Certificates for shares shall
be issued to each shareholder in such form as shall be approved by the Board of
Directors. Such certificates shall be signed by the Chairman of the Board of
Directors or the President or a Vice President and by the Secretary or an
Assistant Secretary or the Treasurer or an Assistant Treasurer of the
corporation, which certificates shall certify the number and class of shares
held by the


                                       8

shareholder in the corporation, but no certificate for shares shall be delivered
until such shares are fully paid. When such a certificate is countersigned by an
incorporated transfer agent or registrar, the signature of any of said officers
of the corporation may be facsimile, engraved, stamped or printed. Although any
officer of the corporation whose manual or facsimile signature is affixed to a
share certificate shall cease to be such officer before the certificate is
delivered, such certificate, nevertheless, shall be effective in all respects
when delivered.

                  Such certificate for shares shall be transferable in person or
by attorney, but, except as hereinafter provided in the case of lost, mutilated
or destroyed certificates, no transfer of shares shall be entered upon the
records of the corporation until the previous certificate, if any, given for the
same shall have been surrendered and canceled.

                  Section 2. Lost, Mutilated or Destroyed Certificates. If any
certificate for shares is lost, mutilated or destroyed, the Board of Directors
may authorize the issue of a new certificate, in place thereof upon such terms
and conditions as it may deem advisable. The Board of Directors in its
discretion may refuse to issue such new certificates until the corporation has
been indemnified to Its satisfaction and until it is protected to its
satisfaction by a final order or decree of a court of competent jurisdiction.

                  Section 3. Registered Shareholders. A person in whose name
shares are of record on the books of the corporation shall conclusively be
deemed the unqualified owner thereof for all purposes and to have capacity to
exercise all rights of ownership. Neither the corporation nor any transfer agent
of the corporation shall be bound to recognize any equitable interest in or
claim to such shares on the part of any other person, whether disclosed upon
such certificate of otherwise, nor shall they be obliged to see to the execution
of any trust or obligation.

                                  ARTICLE VIII
                                   Fiscal Year

                  The fiscal year of the corporation shall be designated by the
first Federal Income Tax Return filed by the corporation, or on such other day
as may be fixed from time to time by the Board of Directors.

                                   ARTICLE IX
                                      Seal

                  The Board of Directors may, in its discretion, provide a
suitable seal containing the name of the corporation. If deemed advisable by the
Board of Directors, duplicate seals may be provided and kept for the purposes of
the corporation.

                                    ARTICLE X
                                   Amendments

                  These By-Laws may be altered or repealed and By-Laws may be
made at any annual meeting of the stockholders or at any special meeting thereof
if notice of the proposed alteration or repeal or By-Law or By-Laws to be made
be contained in the notice of such special meeting, by the affirmative vote of a
majority of the stock issued and outstanding and entitled to


                                       9

vote thereat, or by the affirmative vote of a majority of the Board of
Directors, at any regular or special meeting of the Board of Directors.



























                                       10

EX-3.14

                                                                    EXHIBIT 3.14


                            ARTICLES OF INCORPORATION

                                       OF

                                ARBORS EAST, INC.

         The undersigned, desiring to form a corporation for profit (hereinafter
referred to as the "Corporation") in accordance with Chapter 1701 of the Ohio
Revised Code, hereinafter referred to as the "ORC") hereby states as follows:

         1.       Name. The name of the Corporation is Arbors East, Inc.

         2.       Principal Office. The place in the State of Ohio where the
principal office of the Corporation is to be located is in the City of Lima,
County of Allen.

         3.       Purpose. The purpose for which the corporation is formed is to
engage in any lawful act or activity for which corporations may be formed under
Sections 1701.01 to 1701.98, inclusive, of the ORC.

         4.       Authorized Shares. The number of shares that the Corporation
is authorized to have outstanding is Seven Hundred Fifty (750), which shall be
common shares without par value.

EX-3.15

                                                                    EXHIBIT 3.15


                               CODE OF REGULATIONS
                                       OF
                                ARBORS EAST, INC.


                                    ARTICLE I
                                     Offices

         Section 1. Principal Office. The principal office of the corporation
shall be at such place in the City of Lima, Ohio, as may be designated from time
to time by the Board of Directors.

         Section 2. Other Offices. The corporation shall also have offices at
such other places within, as well as without, the State of Ohio as the Board of
Directors may from time to time determine.

                                   ARTICLE II
                            Meetings of Shareholders

         Section 1. Annual Meeting. The annual meeting of the shareholders of
this corporation for the purpose of fixing or changing the number of directors
of the corporation, electing directors and transacting such other business as
may properly come before the meeting, shall be held on the first Monday of the
fourth month following the close of each fiscal year of the corporation, if not
a legal holiday, but if a legal holiday, then on the next business day
following, or on such other day or date as shall be designated by the Board of
Directors.

         Section 2. Special Meetings. Special meetings of the shareholders may
be called at any time by the President or a Vice President, a majority of the
Board of Directors acting with or without a meeting, or the holder or holders of
one-fourth of all shares outstanding and entitled to vote thereat.

         Section 3. Place of Meetings. Meetings of shareholders shall be held at
the office of the corporation in the City of Lima, Ohio, unless the Board of
Directors decides that a meeting shall be held at some other place within or
without the State of Ohio and causes the notice thereof to so state.

         Section 4. Notice of Meetings. Unless waived, a written, printed or
typewritten notice of each annual or special meeting stating the day, hour and
place and the purpose or purposes thereof shall be served upon or mailed to each
shareholder of record: (a) as of the day next preceding the day on which notice
is given; or (b) if a record date therefore is duly fixed, of record as of said
date. Such notice shall be given not more than sixty (60) days nor less than
seven (7) days before any such meeting. If mailed, it shall be directed to a
shareholder at his address as the same appears upon the record of the
corporation.

         All notices with respect to any shares of record in the names of two or
more persons may be given to whichever of such persons is named first on the
books of the corporation and notice so given shall be effective as to all the
holders of record of such shares.




         Every person who by operation of law, transfer, or otherwise shall
become entitled to any share or right or interest therein shall be bound by
every notice in respect of such share that, prior to his name and address being
entered upon the books of the corporation as the registered holder of such
share, shall have been given to the person in whose name such share appeared of
record.

         Section 5. Waiver of Notice. Any shareholder, either before or after
any meeting, may waive any notice required to be given by law or under these
Regulations; and whenever all of the shareholders entitled to vote shall be
valid for all purposes without call or notice, and at such meeting any action
may be taken.

         Section 6. Quorum. The shareholders present in person or by proxy at
any meeting for the determination of the number of directors, or the election of
directors, or for the consideration and action upon reports required to be laid
before such meeting, shall constitute a quorum.

         At any meeting called for any other purpose, the holders of shares
entitling them to exercise a majority of the voting power of the corporation,
present in person or represented by proxy, shall constitute a quorum, except
when a greater proportion is required by law, the Articles of Incorporation or
these Regulations.

         At any meeting at which a quorum is present, all questions and business
that shall come before the meeting shall be determined by the vote of the
holders of a majority of such voting shares as are represented in person or by
proxy, except when a greater proportion is required by law, these Regulations,
or the Articles of Incorporation.

         At any meeting, whether a quorum is present or not, the holders of a
majority of the voting shares represented by shareholders present in person or
by proxy may adjourn from time to time and from place to place without notice
other than by announcement at the meeting. At any such adjourned meeting at
which a quorum is present, any business may be transacted which might be
transacted at the meeting as originally notified or held.

         Section 7. Voting. At any meeting of shareholders, each shareholder of
the corporation shall, except as otherwise provided by law or by the Articles of
Incorporation or by these Regulations, be entitled to one vote in person or by
proxy for each share of the corporation registered in his name on the books of
the corporation: (1) on the date fixed pursuant to subparagraph (f) of Section 2
of Article IV of these Regulations as the record date for the determination of
shareholders entitled to vote at such meeting, notwithstanding the prior or
subsequent sale, or other disposal of such share or shares or transfer of the
same on the books of the corporation on or after the date so fixed; or (2) if no
such record date shall have been fixed, then at the time of such meeting.

         Section 8. Financial Reports. At the annual meeting of shareholders, or
the meeting held in lieu thereof, there shall be laid before the shareholders a
financial statement consisting of: (1) a balance sheet containing a summary of
the assets, liabilities, stated capital, and surplus (showing separately any
capital surplus arising from unrealized appreciation of assets, other capital
surplus, and earned surplus) of the corporation as of a date not more than


                                       2

four (4) months before such meeting; if such meeting is an adjourned meeting,
said balance sheet may be as of a date not more than four (4) months before the
date of the meeting as originally convened; and (2) a statement of profit and
loss and surplus, including a summary of profits, dividends paid, and other
changes in the surplus accounts of the corporation for the period commencing
with the date marking the end of the period for which the last preceding
statement of profit and loss under this Section was made and ending with the
date of said balance sheet. An opinion signed by the President or a Vice
President or the Treasurer or an Assistant Treasurer, or by a public accountant
or firm of public accountants, shall be appended to such financial statement,
stating that the financial statement presents fairly the corporation's financial
position and the results of its operations in conformity with generally accepted
accounting principles applied on a basis consistent with that of the preceding
period, or such other opinion as is in accordance with sound accounting
practice.

         Section 9. Action Without Meeting. Any action which may be authorized
or taken at any meeting of shareholders may be authorized or taken without a
meeting in a writing or writings signed by all of the holders of shares who
would be entitled to notice of a meeting of the shareholders held for such
purpose. Such writing or writings shall be filed with or entered upon the
records of the corporation.

                                   ARTICLE III
                                    Directors

         Section 1. Number of Directors. The number of authorized Directors of
the Corporation shall be not less than 1 nor more than 15, fixed from time to
time by the shareholder. The Directors shall be elected at the annual meeting of
the shareholders and each Director shall be elected until his successor shall be
elected.

         Section 2. Election of Directors. Directors shall be elected at the
annual meeting of shareholders, but when the annual meeting is not held or
directors are not elected thereat, they may be elected at a special meeting
called and held for that purpose. Such election shall be by ballot whenever
requested by any shareholder entitled to vote at such election; but, unless such
a request is made, the election may be conducted in any manner approved at such
meeting.

         At each meeting of shareholders for the election of directors, the
persons receiving the greatest number of votes shall be directors.

         Section 3. Term of Office. Directors shall hold office until the annual
meeting next succeeding their election and until their successors are elected
and qualified.

         Section 4. Vacancies. Vacancies in the Board of Directors may be filled
by a majority vote of the remaining directors until an election to fill such
vacancies is had. Shareholders entitled to elect directors shall have the right
to fill any vacancy in the board (whether the same has been temporarily filled
by the remaining directors or not) at any meeting of the shareholders called for
that purpose, and any directors elected at any such meeting of shareholders
shall serve until the next annual election of directors and until their
successors are elected and qualified.


                                       3


                                   ARTICLE IV
           Powers, Meetings, Compensation, and Conflicts of Directors

         Section 1. General Powers of Board. The powers of the corporation shall
be exercised, its business and affairs conducted, and its property controlled by
the Board of Directors, except as otherwise provided in the Articles of
Incorporation, amendments thereto, or the Ohio General Corporation Law.

         Section 2. Other Powers. Without prejudice to the general powers
conferred by or implied in the preceding section, the directors, acting as a
Board, shall have powers:

         (a) To fix, define and limit the powers and duties of all officers and
to fix the salaries of all officers;

         (b) To appoint, and at their discretion, with or without cause, to
remove, or suspend, such subordinate officers, assistants, managers, agents and
employees as the directors may from time to time deem advisable, and to
determine their duties and fix their compensation;

         (c) To require any officer, agent or employee of the corporation to
furnish a bond for faithful performance in such amount and with such sureties as
the Board may approve;

         (d) To designate a depository or depositories of the funds of the
corporation and the officer or officers or other persons who shall be authorized
to sign notes, checks, drafts, contracts, deeds, mortgages and other instruments
on behalf of the corporation;

         (e) To appoint and remove transfer agents and/or registrars for the
corporation's shares;

         (f) To fix a time not exceeding sixty (60) days preceding the date of
any meeting of shareholders, or the date fixed for the payment of any dividend
or distribution, or the date for the allotment of rights, or (subject to
contract rights with respect thereto) the date when any change or conversion or
exchange of shares shall be made or go into effect, as a record date for the
determination of the shareholder entitled to notice of and to vote at any such
meeting, or entitled to receive payment of any such dividend, distribution, or
allotment of rights, or to exercise the rights in respect to any such change,
conversion or exchange of shares, and in such case, only the persons who are
shareholders of record or the date so fixed shall be entitled to notice of and
to vote at such meeting, or to receive payment of such dividend, distribution,
or allotment of rights, or to exercise such rights, as the case may be,
notwithstanding any transfer of any shares on the books of the corporation after
any record date fixed as aforesaid, or change of ownership of any shares either
before or after such record date, and such persons shall conclusively be deemed
to be the shareholders of the corporation on such record date, notwithstanding
notice or knowledge to the contrary; and the Board of Directors may close the
books of the corporation against transfer of shares during the whole or any part
of such period; and

         (g) To establish such rules and regulations respecting the issuance and
transfer of shares and certificates for shares as the Board of Directors may
consider reasonable.


                                       4

         Section 3. Meetings of the Board. A meeting of the Board of Directors
shall be held immediately following the adjournment of each shareholders'
meeting at which directors are elected, and notice of such meeting need not be
given. The Board of Directors may, by by-laws or resolution, provide for other
meetings of the Board.

         Special meetings of the Board of Directors may be held at any time upon
call of the President, a Vice President, or any two members of the Board. Notice
of any special meeting of the Board of Directors shall be mailed to each
director, addressed to him at his residence or usual place of business, at least
five (5) days before the day on which the meeting is to be held, or shall be
sent to him at such place by telegram or the equivalent, or be given personally
or by telephone, not later than the day before the day on which the meeting is
to be held. Every such notice shall state the time and place of the meeting but
need not state the purposes thereof. Notice of any meeting of the Board need not
be given to any director, however, if waived by him in writing or by telegram or
the equivalent, whether before or after such meeting be held, or if he shall be
present at such meeting; and any meeting of the Board shall be a legal meeting
without any notice thereof having been given if all the directors shall be
present thereat.

         At meetings of the Board shall be held at the office of the corporation
in the City of Lima, Ohio, or at such other place, within or without the State
of Ohio, as the Board may determine from time to time and as may be specified in
the notice thereof.

         Section 4. Quorum. A majority of the Board of Directors shall
constitute a quorum for the transaction of business, provided that whenever less
than a quorum is present at the time and place appointed for any meeting of the
Board, a majority of those present may adjourn the meeting from time to time,
without notice other than by announcement at the meeting, until a quorum shall
be present.

         Section 5. Action without Meeting. Any action which may be authorized
or taken at a meeting of the directors may be authorized or taken without a
meeting in a writing or writings signed by all the directors, which writing or
writings shall be filed with or entered upon the records of the corporation.

         Section 6. Compensation. The directors, as such, shall not receive any
salary for their services, but by resolution of the Board, a fixed sum and
expenses of attendance, if any, may be allowed that nothing herein contained
shall be construed to preclude any director from serving the corporation in any
other capacity and receiving compensation therefor. Members of the executive
committee or of any standing or special committee may by resolution of the Board
be allowed such compensation for their services as the Board may deem
reasonable, and additional compensation may be allowed to directors for special
services rendered.

         Section 7. Conflicts. A director of this corporation shall not be
disqualified by his office from dealing or contracting with the corporation as a
vendor, purchaser, employee, agent, attorney, or otherwise, nor shall any
transaction or contract or act of this corporation be void or voidable or in any
way affected or invalidated by reason of the fact that any director, or any firm
of which any director is a member, or any corporation of which any director is a
shareholder, officer, or director, is in any way interested in such transaction
or contract or act, provided the fact that such director or such firm or such
corporation is so interested shall be


                                       5

disclosed or shall be known to the Board of Directors or such members thereof as
shall be present at any meeting of the Board of Directors at which action upon
any such contract or transaction or act shall be taken. No such director shall
be accountable to or responsible to the corporation for or in respect to any
such transaction or contract or act of this corporation or for any gains or
profits realized by him by reason of the fact that he, or any firm of which he
is a member, or any corporation of which he is a shareholder, officer, or
director, is interested in such transaction or contract or act. Any director may
be counted in determining the existence of a quorum at any meeting of the Board
of Directors that shall authorize or take action in respect to any such contract
or transaction or act, and may vote thereat to authorize, ratify, or approve any
such contract or transaction or act. Any officer of the corporation may take any
action within the scope of his authority respecting any such contract or
transaction or act with like force and effect as if he or any firm of which he
is a member or any corporation of which he is a shareholder, officer, or
director were not interested in such transaction or contract or act. Without
limiting or qualifying the foregoing, if in any judicial or other inquiry, suit,
cause or proceeding, the question of whether a director or officer of the
corporation has acted in good faith is material, then notwithstanding any
statute or rule of law or of equity to the contrary (if any there be), his good
faith shall be presumed in the absence of proof to the contrary by clear and
convincing evidence.

         Section 8. Indemnification. Each person who at any time is or shall
have been a director, officer, employee or agent of the corporation, or is or
shall have been serving at the request of the corporation as a director, trustee
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise, and his or her heirs, executors and administrators,
shall be indemnified by the corporation against any cost or expense reasonably
incurred by him or her in connection with any threatened, pending, or completed
action, suit or proceeding by reason of such service to or for the corporation
in accordance with and to the full extent permitted by the Ohio General
Corporation law (Ohio Rev. Code Subsection 1701.13(E)) as in effect at the time
of the adoption of these Regulations or as amended from time to time thereafter.
The foregoing right of indemnification shall not be deemed exclusive of other
rights to which any director, officer, employee, agent or other person may be
entitled in any capacity as a matter of law or under any regulation, agreement,
vote of directors or otherwise. The corporation, its directors, officers,
employees and agents shall be fully protected in taking any action or making any
payment under this section, or in refusing so to do, in reliance upon the advice
of counsel. If authorized by the Board of Directors, the corporation may
purchase and maintain insurance against liability on behalf of any such person
to the full extent permitted by law in effect at the time of the adoption of
these Regulations or as changed from time to time.

         Section 9. Reliance on Books and Records. Each officer, director or
member of any committee designated by the Board of Directors of the corporation
shall, in the performance of his duties, be fully protected in relying in good
faith upon the books of account or reports made to the corporation by any of its
officials or by an independent public accountant or by an appraiser selected
with reasonable care by the Board of Directors of the corporation or by any such
committee or in relying in good faith upon other records of the corporation.

         Section 10. By-laws. For the government of its actions, the Board of
Directors may adopt regulation consistent with the Articles of Incorporation and
these Regulations.


                                       6

         Section 11. Committees. The Board of Directors may by resolution
provide for such standing or special committees as it deems desirable, and
discontinue the same at pleasure. Each such committee shall have such powers and
perform such duties, not inconsistent with law, as may be delegated to it by the
Board of Directors. Vacancies in such committees shall be filled by the Board of
Directors or as it may provide.

                                    ARTICLE V
                                    Officers

         Section 1. General Provisions. The Board of Directors shall elect a
president, such number of Vice Presidents as the Board may from time to time
determine, a Secretary and Treasurer, and, in its discretion, a Chairman of the
Board of Directors. The Board of Directors may from time to time create such
offices and appoint such other officers, subordinate officers and assistant
officers as it may determine. Any two or more of such offices, other than that
of President and Vice President, Secretary and Assistant Secretary, or Treasurer
and Assistant Treasurer, may be held by the same person, but no officer shall
execute, acknowledge or verify any instrument in more than one capacity.

         Section 2. Term of Office. The officers of the corporation shall hold
office during the pleasure of the Board of Directors, and unless sooner removed
by the Board of Directors, until the reorganization meeting of the Board of
Directors following, the date of their election and until their successors are
chosen and qualified. The Board of Directors may remove any officer at any time,
with or without cause, by a majority vote. A vacancy in any office, however
created, shall be filled by the Board of Directors.

                                   ARTICLE VI
                               Duties of Officers

         Section 1. Chairman of the Board. The Chairman of the Board, if one be
elected, shall preside at all meetings of the Board of Directors and shall have
such other powers and duties as may be prescribed by the Board of Directors.

         Section 2. President. The president shall be the chief executive
officer of the corporation and shall exercise supervision over the business of
the corporation and over its several officers, subject, however, to the control
of the Board of Directors. He shall preside at all meetings of shareholders and,
in the absence of, or if a Chairman of the Board shall not have been elected,
shall also preside at meetings of the Board of Directors. He shall have
authority to sign all certificates for shares and all deeds, mortgages, bonds,
contracts, notes and other instruments requiring his signature; and shall have
all the powers and duties prescribed by the Ohio general corporation law and
such others as the Board of Directors may from time to time assign to him.

         Section 3. Vice Presidents. The Vice Presidents shall perform such
duties as are conferred upon them by these regulations or as may from time to
time be assigned to them by the Board of Directors or the President. At the
request of the President, or in his absence or disability, the Vice President,
designated by the President (or in the absence of such designation, the Vice
President designated by the Board), shall perform all the duties of the
President, and


                                       7

when so acting, shall have all the powers of the President. The authority of
Vice Presidents to sign in the name of the corporation all certificates for
shares and authorized deeds, mortgages, bonds, contracts, notes and other
instruments, shall be coordinate with like authority of the President. Any one
or more of the Vice Presidents may be designated as "Executive Vice President."

         Section 4. Secretary. The Secretary shall keep minutes of all the
proceedings of the shareholders and Board of Directors, and shall make proper
record of the same, which shall be attested by him; sign all certificates for
shares, and all deeds, mortgages, bonds, contracts, notes, and other instruments
executed by the corporation requiring his signature; give notice of meetings of
shareholders and directors; produce on request at each meeting of shareholders
for the election of directors a certified list of shareholders arranged in
alphabetical order; keep such books as may be required by the Board of
Directors, and file all reports to States, to the Federal Government and to
foreign countries; and perform such other and further duties as may from time to
time be assigned to him by the Board of Directors or by the President.

         Section 5. Treasurer. The Treasurer shall have general supervision of
all finances; he shall receive and have in charge all money, bills, notes,
deeds, leases, mortgages and similar property belonging to the corporation, and
shall do with the same as may from time to time be required by the Board of
Directors. He shall cause to be kept adequate and correct accounts of the
business transactions of the corporation, including accounts of the assets,
liabilities, receipts, disbursements, gains, looses, stated capital, and shares,
together with such other accounts as may be required, and, upon the expiration
of his term of office, shall turn over to his successor or to the Board of
Directors all property, books, papers and money of the corporation in his hands;
and he shall perform such other duties as from time to time may be assigned to
him by the Board of Directors.

         Section 6. Assistant and Subordinate Officers. The Board of Directors
may appoint such assistant and subordinate officers as it may deem desirable.
Each such officer shall hold office during the pleasure of the Board of
Directors, and perform such duties as the Board of Directors may prescribe. The
Board of Directors may, from time to time, authorize any officer to appoint and
remove assistant and subordinate officers, to prescribe their authority and
duties, and to fix their compensation.

         Section 7. Duties of Officers May Be Delegated. In the absence of any
officer of the corporation, or for any other reason the Board of Directors may
deem sufficient, the Board of Directors may delegate, for the time being, the
powers or duties, or any of them, of such officer to any other officer, or to
any director.

                                   ARTICLE VII
                             Certificates for Shares

         Section 1. Form and Execution. Certificates for shares shall be issued
to each shareholder in such form as shall be approved by the Board of Directors.
Such certificates shall be signed by the Chairman of the Board of Directors or
the President or a Vice President and by the Secretary or an Assistant Secretary
or the Treasurer or an Assistant Treasurer of the corporation, which
certificates shall certify the number and class of shares held by the


                                       8

shareholder in the corporation, but no certificate for shares shall be delivered
until such shares are fully paid. When such a certificates is countersigned by
an incorporated transfer agent or registrar, the signature of any of said
officers of the corporation may be facsimile, engraved, stamped or printed.
Although any officer of the corporation whose manual or facsimile signature is
affixed to a share certificate shall cease to be such officer before the
certificate is delivered, such certificate, nevertheless, shall be effective in
all respects when delivered.

         Such certificate for shares shall be transferable in person or by
attorney, but, except as hereinafter provided in the case of lost, mutilated or
destroyed certificates, no transfer of shares shall be entered upon the records
of the corporation until the previous certificate, if any, given for the same
shall have been surrendered and canceled.

         Section 2. Lost, Mutilated or Destroyed Certificates. If any
certificate for shares is lost, mutilated or destroyed, the Board of Directors
may authorize the issue of a new certificate in place thereof upon such terms
and conditions as it may deem advisable. The Board of Directors in its
discretion may refuse to issue such new certificates until the corporation has
been indemnified to its satisfaction and until it is protected to its
satisfaction by a final order or decree of a court of competent jurisdiction.

         Section 3. Registered Shareholders. A person in whose name shares are
of record on the books of the corporation shall conclusively be deemed the
unqualified owner thereof for all purposes and to have capacity to exercise all
rights of ownership. Neither the corporation nor any transfer agent of the
corporation shall be bound to recognize any equitable interest in or claim to
such shares on the part of any other person, whether disclosed upon such
certificate of otherwise, nor shall they be obliged to see to the execution of
any trust or obligation.

                                  ARTICLE VIII
                                   Fiscal Year

         The fiscal year of the corporation shall be designated by the first
Federal Income Tax Return filed by the corporation, or on such other day as may
be fixed from time to time by the Board of Directors.

                                   ARTICLE IX
                                      Seal

         The Board of Directors may, in its discretion, provide a suitable seal
containing the name of the corporation. If deemed advisable by the Board of
Directors, duplicate seals may be provided and kept for the purposes of the
corporation.

                                    ARTICLE X
                                   Amendments

         These By-Laws may be altered or repealed and By-Laws may be made at any
annual meeting of the stockholders or at any special meeting thereof if notice
of the proposed alteration or repeal or By-Law or By-Laws to be made be
contained in the notice of such special meeting, by the affirmative vote of a
majority of the stock issued and outstanding and entitled to


                                       9

vote thereat, or by the affirmative vote of a majority of the Board of
Directors, at any regular or special meeting of the Board of Directors.



                                       10

EX-3.16

                                                                    EXHIBIT 3.16


                            ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


         The undersigned, desiring to form a limited liability Company, under
Chapter 1705 of the Ohio Revised Code, do hereby state the following:

         FIRST: The name of said limited liability company shall be: Arbors West
Care, LLC.

         SECOND: This limited liability company shall exist for a period of
Unlimited/Perpetual.

         THIRD: The address to which interested persons may direct requests for
copies of any operating agreement and any bylaws of this limited liability
company is: 111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.17

                                                                    EXHIBIT 3.17

                  AMENDED AND RESTATED ARTICLES OF ORGANIZATION


                  FIRST: The name of said limited liability company shall be:
Arbors West Realty OH, LLC.

                  SECOND: This limited liability company shall exist for a
period of unlimited/perpetual.

                  THIRD: The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin, 53203.

                  FOURTH: None.

                  FIFTH:

                  1. The LLC shall be a "sole asset entity" as required by the
Secretary of Housing and Urban Development, whose sole asset shall be Arbors
West located at 375 West Main Street, West Jefferson, Madison County, Ohio
("Project").

                  2. The LLC shall not be voluntarily dissolved prior to
December 31, 2040.

                  3. Notwithstanding anything else to the contrary stated in the
Articles of Organization, the LLC shall not indemnify any member except where
applicable state law requires such indemnification.

                  Notwithstanding any other provision in the Articles of
Organization to the contrary, as long as the Secretary of the Department of
Housing and Urban Development ("Secretary") or the Secretary's successors or
assigns is the insurer or holder of the note secured by the mortgage on the
Project.

                  AMENDMENTS. No amendment to the Articles of Organization that
result in any of the following will have any force or effect without the prior
written consent of the Secretary:

                  (a)      Any amendment that modifies the term of the LLC;

                  (b)      Any amendment that activates the requirement that a
                           HUD previous participation certification be obtained
                           from any additional Member;

                  (c)      Any amendment that in any way affects the note,
                           mortgage, or security agreement on the Project or the
                           Regulatory Agreement between HUD and the LLC (the
                           "Regulatory Agreement");

                  (d)      Any amendment that would authorize any Member other
                           than the sole member or managing member to bind the
                           LLC for all matters concerning the Project with
                           required HUD's consent or approval;









                  (e)      A change in the members of the LLC;

                  (f)      Any change in the guarantor(s) of any obligation to
                           the Secretary; or

                  (g)      Any amendment to these Articles of Organization.

                  AUTHORITY OF LLC. The LLC is authorized to execute a note,
mortgage and security agreement in order to secure a loan to be insured by the
Secretary and to execute the Regulatory Agreement and other documents required
in connection with the HUD-insured loan.

                  NEW MEMBERS. No person shall become a Member with at least a
25% financial interest unless s/he meet the applicable requirements for HUD
previous participation clearance. A Member may neither be added or substituted
without the prior written approval of the Secretary. Any incoming Member shall,
as a condition of receiving an interest in the LCC, agree to be bound by the
note, mortgage, security agreement, the Regulatory Agreement and any other
documents required in connection with the HUD-insured loan to the same extent
and on the same terms as the other Members.

                  TRANSFERS UPON DISSOLUTION. Notwithstanding any other
provisions of these Articles of Organization, upon any dissolution, no title, or
right to possession and control of the Project, and no right to collect the
rents from the Project, shall pass to any Person who is not bound by the
Regulatory Agreement in a manner satisfactory to the Secretary.

                  CONFLICTS WITH NOTE OR REGULATORY AGREEMENT. Notwithstanding
any other provisions of the Articles of Organization, in the event that any
provision of this Article of Organization conflicts with the Regulatory
Agreement, the provision of the Regulatory Agreement shall control.

                  NO VOLUNTARY DISASSOCIATION. So long as the Secretary's
successors or assigns is the insurer or holder of the note on the Project, the
LLC may not voluntarily be dissolved or disassociated or changed to another type
of entity without the prior written approval of the Secretary, and any Member
may not be voluntarily changed to a limited liability company or partnership.

                  PERSONAL LIABILITY. The Member(s), and any assignee of a
Member, agree to be liable in their individual capacities to HUD with respect to
the following matters:

                  (a)      For funds or property of the Project coming into
                           their hands, which by the provisions of the
                           Regulatory Agreement, they are not entitled to
                           retain; and

                  (b)      For their own acts and deeds, or acts and deeds of
                           others which they have authorized, in violation of
                           the provisions of the Regulatory Agreement.

                  (c)      For their acts which violate statutes governing the
                           conduct of owners of multifamily projects with
                           FHA-insured mortgages.


                                       2






                  LLC REPRESENTATIVES. Each Member is authorized to represent
and bind the LLC with respect to all matters concerning the Project which
require the consent or approval of the Secretary. The signature of any one
Member shall bind the LLC in all such matters. If the LLC representatives under
this article XIII are changed at any time, the LLC shall provide the Secretary
with written notification of the name, address and telephone number of the new
representative(s) within three (3) business days of such change.





                                       3

EX-3.18

                                                                    EXHIBIT 3.18
                            ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


                  The undersigned, desiring to form a limited liability Company,
under Chapter 1705 of the Ohio Revised Code, do hereby state the following:

                  FIRST: The name of said limited liability company shall be:
Blanchester Care, LLC.

                  SECOND: This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD: The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.19

                                                                    EXHIBIT 3.19

                            ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


                  The undersigned, desiring to form a limited liability Company,
under Chapter 1705 of the Ohio Revised Code, do hereby state the following:

                  FIRST: The name of said limited liability company shall be:
Canton Care, LLC.

                  SECOND: This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD: The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.20

                                                                    EXHIBIT 3.20

                            ARTICLES OF ORGANIZATION
                                       FOR
                        FLORIDA LIMITED LIABILITY COMPANY

                                   ARTICLE I.
                                      NAME

        The name of the Limited Liability Company is: Colonial Care, LLC.

                                   ARTICLE II.
                                     ADDRESS

         The mailing address and street address of the principal office of the
Limited Liability Company is: 111 West Michigan Street, Milwaukee, WI 53203

                                  ARTICLE III.
                     REGISTERED AGENT, REGISTERED OFFICE, &
                          REGISTERED AGENT'S SIGNATURE

      The name and the Florida street address of the registered agent are:

                          Lexis Document Services, Inc.
                               3953 WW Kelley Road
                              Tallahassee, FL 32311

EX-3.21

                                                                    EXHIBIT 3.21

                            ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


                  The undersigned, desiring to form a limited liability Company,
under Chapter 1705 of the Ohio Revised Code, do hereby state the following:

                  FIRST: The name of said limited liability company shall be:
Columbus Rehabilitation Care, LLC.

                  SECOND: This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD: The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.22

                                                                    EXHIBIT 3.22

                        AMENDED ARTICLES OF ORGANIZATION


                  FIRST:   The name of said limited liability company shall be:
Columbus Rehabilitation Realty OH, LLC.

                  SECOND:  This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD:   The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin, 53203.

                  FOURTH:  None.

                  FIFTH:

                  1.       The LLC shall be a "sole asset entity" as required by
the Secretary of Housing and Urban Development, whose sole asset shall be
Columbus Rehabilitation and Subacute Institute located at 44 South Souder
Avenue, Columbus, Franklin County, Ohio ("Project").

                  2.       The LLC shall not be voluntarily dissolved prior to
December 31, 2040.

                  3.       Notwithstanding anything else to the contrary stated
in the Articles of Organization, the LLC shall not indemnify any member except
where applicable state law requires such indemnification.

                  Notwithstanding any other provision in the Articles of
Organization to the contrary, as long as the Secretary of the Department of
Housing and Urban Development ("Secretary") or the Secretary's successors or
assigns is the insurer or holder of the note secured by the mortgage on the
Project.

                  AMENDMENTS.  No amendment to the Articles of Organization that
result in any of the following will have any force or effect without the prior
written consent of the Secretary:

                  (a)      Any amendment that modifies the term of the LLC;

                  (b)      Any amendment that activates the requirement that a
                           HUD previous participation certification be obtained
                           from any additional Member;

                  (c)      Any amendment that in any way affects the note,
                           mortgage, or security agreement on the Project or the
                           Regulatory Agreement between HUD and the LLC (the
                           "Regulatory Agreement");

                  (d)      Any amendment that would authorize any Member other
                           than the sole member or managing member to bind the
                           LLC for all matters concerning the Project with
                           required HUD's consent or approval;









                  (e)      A change in the members of the LLC;

                  (f)      Any change in the guarantor(s) of any obligation to
                           the Secretary; or

                  (g)      Any amendment to these Articles of Organization.

                  AUTHORITY OF LLC. The LLC is authorized to execute a note,
mortgage and security agreement in order to secure a loan to be insured by the
Secretary and to execute the Regulatory Agreement and other documents required
in connection with the HUD-insured loan.

                  NEW MEMBERS. No person shall become a Member with at least a
25% financial interest unless s/he meet the applicable requirements for HUD
previous participation clearance. A Member may neither be added or substituted
without the prior written approval of the Secretary. Any incoming Member shall,
as a condition of receiving an interest in the LCC, agree to be bound by the
note, mortgage, security agreement, the Regulatory Agreement and any other
documents required in connection with the HUD-insured loan to the same extent
and on the same terms as the other Members.

                  TRANSFERS UPON DISSOLUTION. Notwithstanding any other
provisions of these Articles of Organization, upon any dissolution, no title, or
right to possession and control of the Project, and no right to collect the
rents from the Project, shall pass to any Person who is not bound by the
Regulatory Agreement in a manner satisfactory to the Secretary.

                  CONFLICTS WITH NOTE OR REGULATORY AGREEMENT. Notwithstanding
any other provisions of the Articles of Organization, in the event that any
provision of this Article of Organization conflicts with the Regulatory
Agreement, the provision of the Regulatory Agreement shall control.

                  NO VOLUNTARY DISASSOCIATION. So long as the Secretary's
successors or assigns is the insurer or holder of the note on the Project, the
LLC may not voluntarily be dissolved or disassociated or changed to another type
of entity without the prior written approval of the Secretary, and any Member
may not be voluntarily changed to a limited liability company or partnership.

                  PERSONAL LIABILITY. The Member(s), and any assignee of a
Member, agree to be liable in their individual capacities to HUD with respect to
the following matters:

                  (a)      For funds or property of the Project coming into
                           their hands, which by the provisions of the
                           Regulatory Agreement, they are not entitled to
                           retain; and

                  (b)      For their own acts and deeds, or acts and deeds of
                           others which they have authorized, in violation of
                           the provisions of the Regulatory Agreement.

                  (c)      For their acts which violate statutes governing the
                           conduct of owners of multifamily projects with
                           FHA-insured mortgages.

                                       2







                  LLC REPRESENTATIVES. Each Member is authorized to represent
and bind the LLC with respect to all matters concerning the Project which
require the consent or approval of the Secretary. The signature of any one
Member shall bind the LLC in all such matters. If the LLC representatives under
this article XIII are changed at any time, the LLC shall provide the Secretary
with written notification of the name, address and telephone number of the new
representative(s) within three (3) business days of such change.




                                       3

EX-3.23

                                                                    EXHIBIT 3.23


                          ARTICLES OF ORGANIZATION FOR
                        FLORIDA LIMITED LIABILITY COMPANY


                                    ARTICLE I
                                      NAME

                  The name of the Limited Liability Company is: Concordia Manor,
LLC.

                                   ARTICLE II
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee,
Wisconsin 53203.

                                   ARTICLE III
                                    DURATION

                  The period of duration for the Limited Liability Company shall
be: Unlimited/Perpetual.

                                   ARTICLE IV
                                   MANAGEMENT

                  The Limited Liability Company is to be managed by the members
and the name and address of the managing member is: Extendicare Homes, Inc., 111
West Michigan Street, Milwaukee, Wisconsin 53203.

                                    ARTICLE V
                         ADMISSION OF ADDITIONAL MEMBERS

                  The right, if given, of the members to admit additional
members and the terms and conditions of the admissions shall be: N/A.

                                   ARTICLE VI
                       MEMBERS RIGHTS TO CONTINUE BUSINESS

                  The right, if given, of the remaining members of the limited
liability company to continue the business on the death, retirement,
resignation, expulsion, bankruptcy, or dissolution of a member or the occurrence
of any other event which terminates the continued membership of a member in the
limited liability company shall be: None.

EX-3.24

                                                                    EXHIBIT 3.24


                          CERTIFICATE OF INCORPORATION
                          COVENTRY CARE HOLDINGS, INC.


                  FIRST: The name of this Corporation is Coventry Care Holdings,
Inc.

                  SECOND: Its Registered Office in the State of Delaware is to
be located at 30 Old Rudnick Lane, Suite 100, in the City of Dover, County of
Kent, Zip Code 19901. The Registered Agent in charge thereof is Lexis Document
Services Inc.

                  THIRD: The purpose of the corporation is to engage in any
lawful act or activity for which corporations may be organized under the General
Corporation Law of Delaware.

                  FOURTH: The amount of the total authorized capital stock of
this corporation is One Thousand Dollars ($1,000.00) divided into 1,000 shares
of One Dollars ($1.00) each.

                  FIFTH: The name and mailing address of the incorporators are
as follows:

                                      Lisa M. Luedtke
                                      Extendicare Health Services, Inc.
                                      111 W. Michigan Street
                                      Milwaukee, WI 53203

                  SIXTH: The corporation is to have a perpetual existence.

EX-3.25

                                                                    EXHIBIT 3.25

                           ARTICLES OF INCORPORATION
                                       OF
                               COVENTRY CARE, INC.


                  In compliance with the requirements of the Business
Corporation Law, approved the 5th day of May, A.D. 1933, P. L. 364, as amended,
the undersigned, all of whom are of full age and at least two-thirds of whom are
citizens of the United States or its territories or possessions, desiring that
they may be incorporated as a business corporation, do hereby certify:

                  1. The name of the corporation is: Coventry Care, Inc.

                  2. The location and post office address of its initial
registered office in this Commonwealth is:

    805 Hillaire Drive           Mt. Lebanon               Allegheny
    ------------------           -----------               ---------
          Address                   City                    County

                  3. The purpose or purposes of the corporation are:

                  This corporation is organized under the Business Corporation
Law of 1933, approved May 5, 1933, P. L. 364, as amended, to the date hereof.
The corporation shall have unlimited power to engage in and do any lawful act
concerning any or all lawful business for which corporations may be incorporated
under the aforesaid Business Corporation Law, as amended.

                  4. The term of its existence is: Perpetual.

                  5. The aggregate number of shares which the corporation shall
have the authority to issue is 5,400,000, without par value, the total stated
value of which, for excise tax purposes, shall be $34,000 and which shall be
divided into two classes as follows:

                  (a) 5,000,000 shares of Class A Common Stock (without par
value) Stated capital/$50,000.00.

                  (b) 400,000 shares of Class B Common Stock (without par value)
Stated capital/$4,000.00.

Voting Rights and Preemptive Rights

                  The holders of shares of Class A Common Stock shall have one
(1) vote per share. The holders of shares of Class B Common Stock shall have
eight (8) votes per share. All shares of both classes shall be treated the same
share for share in the event of any recapitalization, stock dividend split,
consolidation, merger or reorganization of the corporation. None of the holders
of either class of capital stock shall have any preemptive rights or cumulative
voting rights other than as set forth herein.






Conversion Rights

                  The shares of Class A Common Stock have no conversion rights.
All or any portion of the Class B Common Stock is convertible into Class A
Common Stock, share for share, at any time at the option of the holder thereof.
In the event that any of the initial holders of Class B Common Stock die or
become completely incapacitated for a period of more than six (6) months, all of
the shares of Class B Common Stock shall be immediately converted into a like
number of shares of Class A Common Stock. In the event that any of the initial
holders of Class B Common Stock transfers any Class B Common Stock to any person
other than an initial holder of Class B Common Stock, all such stock transferred
shall be immediately converted into a like number of shares of Class A Common
Stock.

Dividend Rights

                  The holders of shares of Class A Common Stock shall be
entitled to dividends pro-rata per share in respect of all such shares held by
them, when and if declared by the Board of Directors out of funds of the
corporation legally available therefor. The Class B Common Stock is not entitled
to any cash dividend.

Liquidation Rights

                  In the event of the dissolution, winding up or liquidation of
the corporation, whether voluntary or involuntary, the holders of the Class A
Common Stock shall share equally on a per share basis in all assets of the
corporation available for distribution and the Class B Common Stock shall not be
entitled to share therein. Neither a consolidation nor a merger of the
corporation with or into any other corporation, nor any reorganization or
recapitalization of the corporation, shall be considered a liquidation,
dissolution or winding up within the meaning of this subparagraph.

Amendments

                  Any shareholder action which would change the terms,
provisions or relative rights of either class of stock requires a majority vote
of the class which is changed as well as a majority vote of the total voting
power of the corporation.

                  6. The names and addresses of each of the first directors, who
shall serve until the first annual meeting, are:


NAME                            ADDRESS
- ----                            -------
Frederick A. Parson, M.D.       36 First Street, Mayview State Hospital
                                Bridgeville, PA  15017

Harold A. Gold                  805 Hillaire Drive, Pittsburgh, PA  15243

George E. Ewing                 944 Academy Place, Pittsburgh, PA  15243



                                       2



                  7. The names and addresses of each of the incorporators and
the number and class of shares subscribed by each are:


NAME                    ADDRESS                       NUMBER AND CLASS OF SHARES
- ----                    -------                       --------------------------
Harold A. Gold          805 Hillaire Drive            100 Shares
                        Pittsburgh, PA  15243         Class B Common

George E. Ewing         944 Academy Place             100 Shares
                        Pittsburgh, PA  15243         Class B Common




                                       3

EX-3.26

                                                                    EXHIBIT 3.26

                                     AMENDED

                                     BY-LAWS

                                       OF

                               COVENTRY CARE, INC.


                                    ARTICLE I
                                     OFFICES

                  The principal office of the corporation in the Commonwealth of
Pennsylvania shall be located in the Township of Mt. Lebanon, County of
Allegheny. The corporation may have such other offices, either within or without
the Commonwealth of Pennsylvania, as the Board of Directors may designate or as
the business may require from time to time.

                                   ARTICLE II
                                  SHAREHOLDERS

                  Section 1. Annual Meeting. The annual meeting of the
shareholders shall be the fourth week of March per Shareholder Action dated
December 1, 1994. If the election of Directors shall not be held on the day
designated herein for any annual meeting of the shareholders, or at any
adjournment thereof, the Board of Directors shall cause the election to be held
at a special meeting of the shareholders as soon thereafter as it conveniently
may be held.

                  Section 2. Special Meetings. Special meetings of the
shareholders, for any purpose or purposes specified, unless otherwise prescribed
by statute, may be called by the President or by the Board of Directors, and
shall be called by the President at the written request of the holders of not
less than fifty-five (55%) percent of all the outstanding shares of the
corporation entitled to vote at the meeting.

                  Section 3. Place of Meeting. The Board of Directors may
designate any place, either within or without the Commonwealth of Pennsylvania
unless otherwise prescribed by statute, as the place of meeting for any annual
meeting or for any special meeting called by the Board of Directors. A waiver of
notice signed by all shareholders entitled to vote at a meeting may designate
any place, either within or without the Commonwealth of Pennsylvania, unless
otherwise prescribed, by statute, as the place for the holding of such meeting.
If no designation is made, or if a special meeting be otherwise called, the
place of meeting shall be the registered office of the corporation in the
Commonwealth of Pennsylvania.

                  Section 4. Notice of Meeting. Written or printed notice
stating, the place, day and hour of the meeting and, in case of a special
meeting, the purpose or purposes for which the meeting is called, shall be
delivered not less than five (5) nor more than thirty (30) days before the date
of the meeting, either personally or by mail, by or at the direction of the
President, or the Secretary, or the officer or persons calling the meeting, to
each shareholder of record entitled to vote at such meeting. If mailed, such
notice shall be deemed to be delivered when deposited in the United States mail,
addressed to the shareholder at his address as it appears on the stock transfer
books of the corporation, with postage thereon prepaid.




                  Section 5. Voting Lists. The officer or agent having charge of
the stock transfer books for shares of the corporation shall make, on the record
date, which shall be at least five (5) days before each meeting of the
shareholders, a complete list of the shareholders entitled to vote at such
meeting, or any adjournment thereof, arranged in alphabetical order, with the
address of and the number of shares held by each which list, for a period of
five (5) days prior to such meeting, shall be kept on file at the registered
office of the corporation and shall be subject to inspection by any shareholder
at any time during usual business hours. Such list shall also be produced and
kept open at the time and place of the meeting and shall be subject to the
inspection of any shareholder during the whole time of the meeting. The original
stock transfer book shall be prima facie evidence as to who are the shareholders
entitled to examine such list or transfer books or to vote at any meeting of
shareholders.

                  Section 6. Quorum. The holders of shares constituting a
majority of the total voting power of the outstanding shares of the corporation
entitled to vote as provided for in Section 8 of this Article II, represented in
person or by proxy, shall constitute a quorum for the transaction of business at
all meetings of the shareholders except as otherwise provided by statute, the
Articles of Incorporation or these by-laws. If less than a majority of the
voting power so described of the outstanding shares are represented at a
meeting, the majority of the voting power of the corporation so represented may
adjourn the meeting from time to time without further notice. At such adjourned
meeting at which a quorum shall be present or represented, any business may be
transacted which might have been transacted at the meeting as originally
notified. The shareholders present at a duly organized meeting may continue to
transact business until adjournment, notwithstanding the withdrawal of enough
shareholders to leave less than a quorum.

                  Section 7. Proxies. Every shareholder entitled to vote at a
meeting of shareholders or to express consent or dissent to corporate action in
writing without a meeting may authorize another person or persons to act for him
by proxy. Every proxy shall be executed in writing by the shareholder, or by his
duly authorized attorney in fact, and filed with the secretary of the
corporation. A proxy, unless coupled with an interest, shall be revocable at
will, notwithstanding any other agreement or any provision in the proxy to the
contrary, but the revocation of a proxy shall not be effective until notice
thereof has been given to the secretary of the corporation. No unrevoked proxy
shall be valid after eleven months from the date of its execution, unless a
longer time is expressly provided therein, but in no event shall a proxy, unless
coupled with an interest, be voted on after three years from the date of its
execution.

                  Section 8. Voting of Shares. Subject to the provisions of
Section 10 of this Article II, each outstanding share of Common Stock entitled
to vote shall be entitled to one vote upon each matter submitted to a vote at a
meeting of shareholders.

                  Section 9. Voting of Shares by Certain Holders. Shares
standing in the name of another corporation may be voted by an officer, agent or
proxy of such corporation without a transfer of such shares into his name.
Shares standing in the name of a trustee may be voted by him either in person or
by proxy, but no trustee shall be entitled to vote shares held by him without a
transfer of such shares into his name.




                                       2

                  Shares standing in the name of a receiver may be voted by such
receiver, and shares held by or under the control of a receiver may be voted by
such receiver without the transfer thereof into his name if authority so to do
be contained in an appropriate order of the court by which such receiver was
appointed.

                  A shareholder whose shares are pledged shall be entitled to
vote such shares until the shares have been transferred into the name of the
pledgee, and thereafter the pledgee shall be entitled to vote the shares so
transferred.

                  Shares of its own stock belonging to the corporation or held
by it in a fiduciary capacity shall not be voted, directly or indirectly, at any
meeting, and shall not be counted in determining the total number of outstanding
shares at any given time.

                  Section 10. No Cumulative Voting. Unless otherwise provided by
law, at each election for Directors there shall be no cumulative voting and
every shareholder entitled to vote at such election shall have the right to
vote, in person or by proxy, the number of shares owned by him on the record
date according to the voting power which is provided for such shares in Section
8 of this Article II for as many persons as there are directors to be elected
and for whose election he has a right to vote.

                  Section 11. Informal Action by Shareholders. Unless otherwise
provided by law, any action which may be taken at a meeting of the shareholders,
may be taken without a meeting if a consent in writing, setting forth the action
so taken, shall be signed by all of the shareholders entitled to vote with
respect to the subject matter thereof.

                  Section 12. Order of Business. The order of business at the
annual meeting of the shareholders shall be as follows:

                  (a)      Calling meeting of shareholders to order;

                  (b)      Proof of notice of meeting;

                  (c)      Reading of minutes of last annual meeting;

                  (d)      Reports of officers;

                  (e)      Reports of committees;

                  (f)      Election of directors;

                  (g)      Miscellaneous business.

                  Section 13. The provisions of Article IX, Section 910 of the
Pennsylvania Business Corporation Law, enacted December 23, 1983, Act No. 92,
Session of 1983, shall not be applicable to this corporation. Per Amendment
dated March 21, 1984.




                                       3

                                   ARTICLE III
                               BOARD OF DIRECTORS

                  Section 1. General Powers. The business and affairs of the
corporation shall be managed by its Board of Directors.

                  Section 2. Number, Tenure and Qualifications. The number of
authorized Directors of the Corporation shall be not less than 1 nor more than
15, fixed from time to time by the shareholders. The Directors shall be elected
at the annual meeting of the shareholders and each Director shall be elected to
serve until his successor shall be elected and shall qualify.

                  Section 3. Regular Meetings. A regular meeting of the Board of
Directors shall be held without other notice than these By-Laws immediately
after, and at the same place, as the annual meeting of shareholders. The Board
of Directors may provide, by resolution, the time and place for the holding of
additional regular meetings without other notice than such resolution.

                  Section 4. Special Meetings. Special meetings of the Board of
Directors may be called by or at the request of the President and any two
directors. The person or persons authorized to call special meetings of the
Board of Directors may fix the place for holding any special meeting of the
Board of Directors called by them.

                  Section 5. Notice. Notice of any special meeting shall be
given at least twenty-four (24) hours previously thereto by written notice
delivered personally to each director at his business address, or by telegram.
If notice be given by telegram, such notice shall be deemed to be delivered when
the telegram is delivered to the telegraph company. Notice of any special
meeting may be given by mail and if mailed, such notice shall be deemed to be
delivered when deposited forty-eight hours prior to the meeting in the United
States mail so addressed, with postage thereon prepaid. Any director may waive
notice of any meeting. The attendance of director at a meeting shall constitute
a waiver of notice of such meeting, except where a director attends a meeting
for the express purpose of objecting to the transaction of any business because
the meeting is not lawfully called or convened.

                  Section 6. Quorum. A majority of the number of directors fixed
by Section 2 of this Article III shall constitute a quorum for the transaction
of business of any meeting of the Board of Directors, but if less than such
majority is present at a meeting, a majority of the directors present may
adjourn the meeting from time to time without further notice.

                  Section 7. Manner of Acting. The act of the majority of the
directors present at a meeting at which a quorum is present shall be the act of
the Board of Directors.

                  Section 8. Vacancies. Any vacancy, including any vacancy
resulting from an increase in the number of directors, occurring in the Board of
Directors may be filled by the affirmative vote of a majority of the remaining
directors though less than a quorum of the Board of Directors, unless otherwise
provided by law. A director elected to fill a vacancy shall be elected for the
unexpired term of his predecessor in office.




                                       4

                  Section 9. Compensation. By resolution of the Board of
Directors, the Directors may be paid their expenses, if any, of attendance at
each meeting of the Board of Directors, and may be paid a fixed sum for
attendance at each meeting of the Board of Directors or a stated salary as
director. No such payment shall preclude any director from serving the
corporation in any other capacity and receiving compensation therefor.

                  Section 10. Presumption of Assent. A director of the
corporation who is present at a meeting of the Board of Directors at which
action on any corporate matter is taken shall be presumed to have assented to
the action taken unless his dissent shall be entered in the minutes of the
meeting or unless he shall file his written dissent to such action with the
person acting as the secretary of the meeting before the adjournment thereof or
shall forward such dissent by registered mail to the secretary of the
corporation immediately after the adjournment of the meeting. Such right to
dissent shall not apply to a director who voted in favor of such action.

                  Section 11. In addition to the powers and authorities by these
By-Laws expressly conferred upon it, the Board may exercise all such powers of
the corporation and do all such lawful acts and things as are not by statute or
by the Articles or by these By-Laws directed or required to be exercised or done
by the shareholders, including, but not limited to, the power by resolution
passed by a majority of the whole Board of Directors to elect one of its number
as Chairman and to delegate two or more of its number to constitute an executive
committee which shall have and exercise the authority of the Board of Directors
in the management of the business of the corporation, and to establish a
compensation committee as provided for in Section 9 or Article IV. Any action
which may be taken at a meeting of the directors or the members of the executive
committee may be taken without a meeting, if a consent or consents in writing
setting forth the action so taken shall be signed by all of the directors or the
members of the executive committee, as the case may be, and shall be filed with
the secretary of the corporation.

                                   ARTICLE IV
                                    OFFICERS

                  Section 1. Number. The officers of the corporation shall be a
President, a Vice-President, a Secretary and a Treasurer, each of whom shall be
elected by the Board of Directors. Such other officers and assistant officers as
may be deemed necessary may be elected or appointed by the Board of Directors.
Nothing containing in these By-Laws shall preclude the Board of Directors from
electing members of the Board of Directors as officers of the corporation.

                  Section 2. Election and Term of Office. The officers of the
corporation to be elected by the Board of Directors shall be elected annually by
the Board of Directors at the first meeting of the Board of Directors held after
each annual meeting of the shareholders. If the election of officers shall not
be held at such meeting, such election shall be held as soon thereafter as
conveniently may be. Each officer shall hold office until his successor shall
have been duly elected and shall have qualified or until his death or until he
shall resign or shall have been removed in the manner hereinafter provided.




                                       5

                  Section 3. Removal. Any officer or agent elected or appointed
by the Board of Directors may be removed by the Board of Directors whenever in
its judgment the best interests of the corporation would be served thereby, but
such removal shall be without prejudice to the contract rights, if any, of the
person so removed.

                  Section 4. Vacancies. A vacancy in any office because of
death, resignation, removal, disqualification or otherwise, may be filled by the
Board of Directors for the unexpired portion of the term.

                  Section 5. President. The president shall be the chief
executive officer of the corporation, and subject to the control of the Board of
Directors, shall in general supervise and control all of the business and
affairs of the corporation. He shall, when present, preside at all meetings of
the shareholders and of the Board of Directors. He may sign, with attestation by
the Secretary, Assistant Secretary or any other proper officer of the
corporation thereunto authorized by the Board of Directors, certificates for
shares of the corporation, which he is authorized, moreover, to endorse and
transfer, any deeds, mortgages, bonds, contracts, or other instruments which the
Board of Directors has authorized to be executed, except in cases where the
signing and execution thereof shall be expressly delegated by the Board of
Directors or these By-Laws to some other officer or agent of the corporation, or
shall be required by law to be otherwise signed or executed; and in general
shall perform all duties incident to the office of President and such other
duties as may be prescribed by the Board of Directors from time to time.

                  Section 6. Vice-Presidents. In the absence of the President or
in the event of his death, inability or refusal to act, the Vice-Presidents in
the order determined by the Board of Directors shall perform the duties of the
President, and when so acting, shall have all the powers of and be subject to
all the restrictions upon the President. The Vice-Presidents shall perform such
other duties as from time to time may be assigned to him by the President or by
the Board of Directors.

                  Section 7. Secretary. The Secretary shall: (a) keep the
minutes of the shareholders' and of the Board of Directors' meetings in one or
more books provided for that purpose; (b) see that all notices are duly given in
accordance with the provisions of these By-Laws or as required by law; (c) be
custodian of the corporate records and of the seal of the corporation and see
that the seal of the corporation is affixed to all documents the execution of
which on behalf of the corporation under its seal is duly authorized; (d) keep a
register of the post office address of each shareholder which shall be furnished
to the Secretary by such shareholder; (e) have general charge of the stock
transfer books of the corporation; and (f) in general perform all duties
incident to the office of Secretary and such other duties as from time to time
may be assigned to him by the President or by the Board of Directors.

                  Section 8. Treasurer. If required by the Board of Directors,
the Treasurer shall give a bond for the faithful discharge of his duties in such
sum and with such surety or sureties as the Board of Directors shall determine.
He shall: (a) have charge and custody of and be responsible for all funds and
securities of the corporation; receive and give receipts for moneys due and
payable to the corporation from any source whatsoever, and deposit all such
moneys in the name of the corporation in such banks, trust companies or other
depositaries as shall be selected in accordance with the provisions of Article V
of these By-Laws; and (b) in


                                       6

general perform all of the duties incident to the office of Treasurer and such
other duties as from time to time may be assigned to him by the President or by
the Board of Directors.

                  Section 9. Compensation. The compensation of the officers
shall be fixed from time to time by the Board of Directors or by such
Compensation Committee as may be established by the Board of Directors to which
the Board of Directors shall delegate two or more members of the Board of
Directors and which shall have and exercise the authority of the Board of
Directors in fixing said compensation and no officer shall be prevented from
receiving such salary by reason of the fact that he is also a director of the
corporation.

                                    ARTICLE V
                                 INDEMNIFICATION

                  Section 1. This corporation 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 (other than an action by or in the right of the corporation) by
reason of the fact that he is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorney's
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in, or not opposed
to, the best interests of the corporation and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his conduct was
unlawful. The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the person did not act in good
faith and in a manner which be reasonably believed to be in, or not opposed to,
the best interests of the corporation, and, with respect to any criminal action
or proceeding, had reasonable cause to believe that his conduct was unlawful.

                  Section 2. This corporation 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 corporation to procure a
judgment in its favor by reason of the fact that he is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against
expenses (including attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in, or not opposed to,
the best interests of the corporation and except that no indemnification shall
be made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable for negligence or misconduct in the performance
of his duty to the corporation unless and only to the extent that the Court of
Common Pleas of the county in which the registered office of the corporation is
located or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case such person is fairly and reasonably entitled to
indemnify for such expenses which the Court of Common Pleas or such other court
shall deem proper.




                                       7

                  Section 3. To the extent that a director, officer, employee or
agent of the corporation has been successful on the merits or otherwise in
defense of any action, suit or proceeding referred to in Sections 1 and 2 or in
defense of any claim, issue or matter therein, he shall be indemnified against
expenses (including attorneys' fees) actually and reasonably incurred by him in
connection therewith.

                  Section 4. Any indemnification under Sections l and 2 of this
Article V (unless ordered by a court) shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification of the
director, officer, employee or agent is proper in the circumstances because he
has met the applicable standard of conduct set forth in such section. Such
determination shall be made:

                  (a) By the Board of Directors by a majority vote of a quorum
consisting of directors who were not parties to such action, suit or proceeding,
or,

                  (b) If such a quorum is not obtainable, or, even if obtainable
a majority vote of a quorum of disinterested directors so directs, by
independent legal counsel in a written opinion, or

                  (c) By the shareholders.

                  Section 5. Expenses incurred in defending a civil or criminal
action, suit or proceeding may be paid by the corporation in advance of the
final disposition of such action, suit or proceeding as authorized in the manner
provided in Section 3 upon receipt of an undertaking by or on behalf of the
director, officer, employee or agent to repay such amount unless it shall
ultimately be determined that he is entitled to be indemnified by the
corporation as authorized in this Article.

                  Section 6. The indemnification provided by this Article shall
not be deemed exclusive of any other rights to which those seeking
indemnification may be entitled under any by-law, agreement vote of shareholders
or disinterested directors or otherwise, both as to action in his official
capacity and as to action in another capacity while holding such office, and
shall continue as to a person who has ceased to be a director, officer, employee
or agent and shall inure to, the benefit of the heirs, executors and
administrators of such a person.

                  Section 7. The corporation shall have the power to purchase
and maintain insurance on behalf of any person who is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against any
liability asserted against him and incurred by him in any such capacity, or
arising out of his status as such, whether or not the corporation would have the
power to indemnify him against such liability under the provisions of this
Article.

                                   ARTICLE VI
                      CONTRACTS LOANS, CHECKS AND DEPOSITS

                  Section 1. Contracts. The Board of Directors may authorize any
officer or officers, agent or agents, to enter into any contract or execute and
deliver any instrument in the



                                       8

name of any on behalf of the corporation, and such authority may be general or
confined to specific instances.

                  Section 2. Loans. No loans shall be contracted on behalf of
the corporation and no evidences of indebtedness shall be issued in its name
unless authorized by a resolution of the Board of Directors. Such authority may
be general or confined to specific instances.

                  Section 3. Checks, drafts, etc. All checks, drafts and other
orders for the payment of money, notes or other evidences of indebtedness issued
in the name of the corporation, shall be signed by such officer or officers,
agent or agents of the corporation and in such manner as shall from time to time
be determined by resolution of the Board of Directors.

                  Section 4. Deposits. All funds of the corporation not
otherwise employed shall be deposited from time to time to the credit of the
corporation in such banks, trust companies or other depositaries as the Board of
Directors may select.

                                   ARTICLE VII
                   CERTIFICATES FOR SHARES AND THEIR TRANSFER

                  Section 1. Certificates for Shares. Certificates representing
shares of the corporation shall be in such form as shall be signed by the
President and by the Secretary or by such other officers authorized by law and
by the Board of Directors so to do and shall be sealed with the corporate seal
which may be facsimile, engraved or printed but where such share certificate is
signed by a transfer agent or registrar the signature of any corporate officer
upon such certificate may be facsimile, engraved or printed. In case any officer
who has signed, or whose facsimile signature has been placed upon any share
certificate shall have ceased to be such officer because of death, resignation,
or otherwise, before the certificate is issued, it may be issued by the
corporation with the same effect as if the officer had not ceased to be such at
the date of its issue. All certificates shall be consecutively numbered or
otherwise identified. The name and address of the person to whom the shares
represented thereby are issued, with the number of shares and date of issue,
shall be entered on the stock transfer books of the corporation. All
certificates surrendered to the corporation for transfer shall be cancelled and
no new certificate shall be issued until the former certificate for a like
number of shares shall have been surrendered and cancelled, except that in case
of a lost, destroyed or mutilated certificate a new one may be issued therefor
upon such terms and indemnity to the corporation as the Board of Directors may
prescribe.

                  Section 2. Transfer of Shares. Transfer of shares of the
corporation shall be made only on the stock transfer books of the corporation by
the holder of record thereof or by his legal representative, who shall furnish
proper evidence of authority to transfer, or by his attorney thereunto
authorized by power of attorney duly executed and filed with the Secretary of
the corporation, and on surrender for cancellation of the certificate for such
shares. The person in whose name shares stand on the books of the corporation
shall be deemed by the corporation to be the owner thereof for all purposes.




                                       9

                                  ARTICLE VIII
                                   FISCAL YEAR

                  The fiscal year of the corporation shall begin on the first
day of May and end on the 30th day of April in each year.

                                   ARTICLE IX
                                    DIVIDENDS

                  Dividends upon the shares of the Corporation, subject to the
provisions of the Articles of Incorporation, if any, may be declared by the
Board of Directors at any regular or special meeting, pursuant to law. Dividends
may be paid in cash, in property, or in its shares, subject to the provisions of
the Articles of Incorporation.

                                    ARTICLE X
                                      SEAL

                  The Board of Directors shall provide a corporate seal which
shall be circular in form and shall have inscribed thereon the name of the
corporation and the State of incorporation and the words, "Corporate Seal".

                                   ARTICLE XI
                                WAIVER OF NOTICE

                  Unless otherwise provided by law, whenever any notice is
required to be given to any shareholders or director of the corporation under
the provisions of these Amended By-Laws or under the provisions of the Articles
of Incorporation, a waiver thereof in writing, signed by the person or persons
entitled to such notice, whether before or after the time stated therein, shall
be deemed equivalent to the giving of such notice.

                                   ARTICLE XII
                                   AMENDMENTS

                  These Amended By-Laws may be altered, amended or repealed and
new By-Laws may be adopted by a vote of the shareholders representing a majority
of the total voting power set forth in Section 8 of Article II of all the shares
issued and outstanding, at any annual shareholders' meeting or at any special
shareholders' meeting when the proposed amendment has been set out in the notice
of such meeting, or by a majority vote of the members of the Board of Directors
at any regular or special meeting, duly convened after notice to the Directors
of that purpose, subject always to the power of the shareholders to change such
action by the Directors.




                                       10

EX-3.27

                                                                    EXHIBIT 3.27

                           ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


                  The undersigned, desiring to form a limited liability Company,
under Chapter 1705 of the Ohio Revised Code, do hereby state the following:

                  FIRST: The name of said limited liability company shall be:
Dayton Care, LLC.

                  SECOND: This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD: The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.28

                                                                    EXHIBIT 3.28

                            ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


                  The undersigned, desiring to form a limited liability Company,
under Chapter 1705 of the Ohio Revised Code, do hereby state the following:

                  FIRST: The name of said limited liability company shall be:
Delaware Care, LLC.

                  SECOND: This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD: The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.29

                                                                    EXHIBIT 3.29


                       CERTIFICATE OF LIMITED PARTNERSHIP

         In compliance with the requirements of the Delaware Limited Partnership
Act, Title 6, Chapter 17 of the Delaware Code (relating to certificate of
limited partnership), the undersigned, desiring to form a limited partnership,
hereby certifies that:

1.       The name of the limited partnership is:     Edgewood Care, LP

2.       The address of this limited partnership's initial registered office is:


         111 West Michigan Street,       Milwaukee,       WI              53203              Milwaukee
         -------------------------------------------------------------------------------------------------
            Number and Street              City          State             Zip                County



3.       The address of this limited partnership's registered agent upon whom
         process may be served is:


         Lexis Document Services Inc.
         30 Old Rudnick Lane, Suite 100,      Dover,        DE            19901             Kent
         --------------------------------------------------------------------------------------------------
             Number and Street                City         State           Zip            County



4.       The name and business address of each general partner of the
         partnership is:


         Name                               Address

         Coventry Care Holdings, Inc.       111 West Michigan Street, Milwaukee, WI  53203




5.       The formation of the limited partnership shall be effective upon filing
         this Certificate of Limited Partnership with the Office of the
         Secretary of State.

EX-3.30

                                                                    EXHIBIT 3.30




                            ARTICLES OF INCORPORATION
                                       OF
                             EDGEWOOD NURSING CENTER


                  In compliance with the requirements of the Business
Corporation Law, approved the 5th day of May, A.D. 1933, P.L. 364, as amended,
the undersigned, all of whom are of full age desiring that they may be
incorporated as a business corporation, do hereby certify:

                  1. The name of the corporation is: Edgewood Nursing Center.

                  2. The location and post office address of its initial
registered office in this Commonwealth is:

   805                 Hillaire Drive           Mt. Lebanon            Allegheny
- --------------------------------------------------------------------------------
   Number                  Street                  City                 County

                  3. The purpose or purposes of the corporation which shall be
organized under this Act are as follows:

                  This corporation is organized under the Business Corporation
Law of 1933, approved May 5, 1933, P.L. 364, as amended to the date hereof. The
corporation shall have unlimited power to engage in and do any lawful act
concerning any or all lawful business for which corporations may be incorporated
under the aforesaid Business Corporation Law, as amended.

                  4. The term of its existence is Perpetual.

                  5. The aggregate number of shares which the corporation shall
have authority to issue is: 100,000 shares of Common Stock, without par value,
the total stated value of which, for excise tax purposes, shall be $10,000.

                  6. The names and addresses of each of the first directors, who
shall serve until the first annual meeting, are:

         NAME                                           ADDRESS
                                          (including street and number, if any)

 Frederick A. Parsons, M.D.              36 First St., Mayview State Hospital
                                             Pittsburgh, Pennsylvania 15017

     Harold A. Gold                    805 Hillaire Drive, Pittsburgh, Pa. 15243

     George E. Ewing                    944 Academy Place, Pittsburgh, Pa. 15243


                  7. The names and addresses of each of the incorporators and
the number and class of shares subscribed by each are:








   NAME                           ADDRESS                      NUMBER AND CLASS
                      (including street and number, if any)        OF SHARES

Harold A. Gold           805 Hillaire Dr., Pgh, Pa.             1 share common

George E. Ewing          944 Academy Pl., Pgh, Pa.              1 share common




                                        2

EX-3.31

                                                                    EXHIBIT 3.31

                                     BY-LAWS
                                       OF
                         EDGEWOOD NURSING CENTERS, INC.

                                    ARTICLE I
                                     Offices

                  The principal office of the corporation in the Commonwealth of
Pennsylvania shall be located in the Township of Mt. Lebanon, County of
Allegheny. The corporation may have such other offices, either within or without
the Commonwealth of Pennsylvania, as the Board of Directors may designate or as
the business of the corporation may require from time to time.

                                   ARTICLE II
                                  Shareholders

                  Section 1. Annual Meeting. The annual meeting of the
shareholders shall be the fourth week of March per Shareholder action dated
12/1/94. If the election of Directors shall not be held on the day designated
herein for any annual meeting of the shareholders, or at any adjournment
thereof, the Board of Directors shall cause the election to be held at a special
meeting of the shareholders as soon thereafter as it conveniently may be held.

                  Section 2. Special Meetings. Special meetings of the
shareholders, for any purpose or purposes specified, unless otherwise prescribed
by statute, may be called by the President or by the Board of Directors, and
shall be called by the President at the written request of the holders of not
less than fifty-five (55%) percent of all the outstanding shares of the
corporation entitled to vote at the meeting.

                  Section 3. Place of Meeting. The Board of Directors may
designate any place, either within or without the Commonwealth of Pennsylvania
unless otherwise prescribed by statute, as the place of meeting for any annual
meeting or for any special meeting called by the Board of Directors. A waiver of
notice signed by all shareholders entitled to vote at a meeting may designate
any place, either within or without the Commonwealth of Pennsylvania, unless
otherwise prescribed by statute, as the place for the holding of such meeting.
If no designation is made, or if a special meeting be otherwise called, the
place of meeting shall be the registered office of the corporation in the
Commonwealth of Pennsylvania.

                  Section 4. Notice of Meeting. Written or printed notice
stating the place, day and hour of the meeting and, in case of a special
meeting, the purpose or purposes for which the meeting is called, shall be
delivered not less than five (5) nor more than thirty (30) days before the date
of the meeting, either personally or by mail, by or at the direction of the
President, or the Secretary, or the officer or persons calling the meeting, to
each shareholder of record entitled to vote at such meeting. If mailed, such
notice shall be deemed to be delivered when deposited in the United States mail,
addressed to the shareholder at his address as it appears on the stock transfer
books of the corporation, with postage thereon prepaid.

                  Section 5. Voting Lists. The officer or agent having charge of
the stock transfer books for shares of the corporation shall make, on the record
date, which shall be at least



five (5) days before each meeting of the shareholders, a complete list of the
shareholders entitled to vote at such meeting, or any adjournment thereof,
arranged in alphabetical order, with the address of and the number of shares
held by each, which list, for a period of five (5) days prior to such meeting,
shall be kept on file at the registered office of the corporation and shall be
subject to inspection by any shareholder at any time during usual business
hours. Such list shall also be produced and kept open at the time and place of
the meeting and shall be subject to the inspection of any shareholder during the
whole time of the meeting. The original stock transfer book shall be prima facie
evidence as to who are the shareholders entitled to examine such list or
transfer books or to vote at any meeting of shareholders.

                  Section 6. Quorum. The holders of shares constituting a
majority of the total voting power of the outstanding shares of the corporation
entitled to vote as provided for in Section 8 of this Article II, represented in
person or by proxy, shall constitute a quorum for the transaction of business at
all meetings of the shareholders except as otherwise provided by statute, the
Articles of Incorporation or these by-laws. If less than a majority of the
voting power so described of the outstanding shares are represented at a
meeting, the majority of the voting power of the corporation so represented may
adjourn the meeting from time to time without further notice. At such adjourned
meeting at which a quorum shall be present or represented, any business may be
transacted which might have been transacted at the meeting as originally
notified. The shareholders present at a duly organized meeting may continue to
transact business until adjournment, notwithstanding the withdrawal of enough
shareholders to leave less than a quorum.

                  Section 7. Proxies. Every shareholder entitled to vote at a
meeting of shareholders or to express consent or dissent to corporate action in
writing without a meeting may authorize another person or persons to act for him
by proxy. Every proxy shall be executed in writing by the shareholder, or by his
duly authorized attorney in fact, and filed with the secretary of the
corporation. A proxy, unless coupled with an interest, shall be revocable at
will, notwithstanding any other agreement or any provision in the proxy to the
contrary, but the revocation of a proxy shall not be effective until notice
thereof has been given to the secretary of the corporation. No unrevoked proxy
shall be valid after eleven months from the date of its execution, unless a
longer time is expressly provided therein, but in no event shall a proxy, unless
coupled with an interest, be voted on after three years from the date of its
execution.

                  Section 8. Voting of Shares. Subject to the provisions of
Section 10 of this Article II each outstanding share of common Stock entitled to
vote shall be entitled to one vote upon each matter submitted to a vote at a
meeting of shareholders.

                  Section 9. Voting of Shares by Certain Holders. Shares
standing in the name of another corporation may be voted by an officer, agent or
proxy of such corporation without a transfer of such shares into his name.
Shares standing in the name of a trustee may be voted by him, either in person
or by proxy, but no trustee shall be entitled to vote shares held by him without
a transfer of such shares into his name.

                  Shares standing in the name of a receiver may be voted by such
receiver, and shares held by or under the control of a receiver may be voted by
such receiver without the



                                       2

transfer thereof into his name if authority so to do be contained in an
appropriate order of the court by which such receiver was appointed.

                  A shareholder whose shares are pledged shall be entitled to
vote such shares until the shares have been transferred into the name of the
pledgee, and thereafter the pledgee shall be entitled to vote the shares so
transferred.

                  Shares of its own stock belonging to the corporation or held
by it in a fiduciary capacity shall not be voted, directly or indirectly, at any
meeting, and shall not be counted in determining the total number of outstanding
shares at any given time.

                  Section 10. No Cumulative Voting. Unless otherwise provided by
law, at each election for Directors there shall be no cumulative voting and
every shareholder entitled to vote at such election shall have the right to
vote, in person or by proxy, the number of shares owned by him on the record
date according to the voting power which is provided for such shares in Section
8 of this Article II for as many persons as there are directors to be elected
and for whose election he has a right to vote.

                  Section 11. Informal Action by Shareholders. Unless otherwise
provided by law, any action which may be taken at a meeting of the shareholders,
may be taken without a meeting if a consent in writing, setting forth the action
so taken, shall be signed by all of the shareholders entitled to vote with
respect to the subject matter thereof.

                  Section 12. Order of Business. The order of business at the
annual meeting of the shareholders shall be as follows

                  (a)      Calling meeting of shareholders to order;
                  (b)      Proof of notice of meeting;
                  (c)      Reading of minutes of last annual meeting;
                  (d)      Reports of officers;
                  (e)      Reports of committees;
                  (f)      Election of directors;
                  (g)      Miscellaneous business.

                                  ARTICLE III
                               Board of Directors

                  Section 1. General Powers. The business and affairs of the
corporation shall be managed by its Board of Directors.

                  Section 2. Number, Tenure and Qualifications. The number of
authorized Directors of the Corporation shall be not less than 1 nor more than
15, fixed from time to time by the shareholders. The Directors shall be elected
at the annual meeting of the shareholders and each Director shall be elected to
serve until his successor shall be elected and shall qualify.

                  Section 3. Regular Meetings. A regular meeting of the Board of
Directors shall be held without other notice than these By-Laws immediately
after, and at the same place, as the annual meeting of shareholders. The Board
of Directors may provide, by resolution, the



                                       3


time and place for the holding of additional regular meetings without other
notice than such resolution.

                  Section 4. Special Meetings. Special meetings of the Board of
Directors may be called by or at the request of the President and any two
directors. The person or persons authorized to call special meetings of the
Board of Directors may fix the place for holding any special meeting of the
Board of Directors called by them.

                  Section 5. Notice. Notice of any special meeting shall be
given at least twenty-four (24) hours previously thereto by written notice
delivered personally to each director at his business address, or by telegram.
If notice be given by telegram, such notice shall be deemed to be delivered when
the telegram is delivered to the telegraph company. Notice of any special
meeting may be given by mail and if mailed, such notice shall be deemed to be
delivered when deposited forty-eight hours prior to the meeting in the United
States mail so addressed, with postage thereon prepaid. Any director may waive
notice of any meeting. The attendance of a director at a meeting shall
constitute a waiver of notice of such meeting, except where a director attends a
meeting for the express purpose of objecting to the transaction of any business
because the meeting is not lawfully called or convened.

                  Section 6. Quorum. A majority of the number of directors fixed
by Section 2 of this Article III shall constitute a quorum for the transaction
of business of any meeting of the Board of Directors, but if less than such
majority is present at a meeting, a majority of the directors present may
adjourn the meeting from time to time without further notice.

                  Section 7. Manner of Acting. The act of the majority of the
directors present at a meeting at which a quorum is present shall be the act of
the Board of Directors.

                  Section 8. Vacancies. Any vacancy, including any vacancy
resulting from an increase in the number of directors, occurring in the Board of
Directors may be filled by the affirmative vote of a majority of the remaining
directors though less than a quorum of the Board of Directors, unless otherwise
provided by law. A director elected to fill a vacancy shall be elected for the
unexpired term of his predecessor in office.

                  Section 9. Compensation. By resolution of the Board of
Directors, the Directors may be paid their expenses, if any, of attendance at
each meeting of the Board of Directors, and may be paid a fixed sum for
attendance at each meeting of the Board of Directors or a stated salary as
director. No such payment shall preclude any director from serving the
corporation in any other capacity and receiving compensation therefor.

                  Section 10. Presumption of Assent. A director of the
corporation who is present at a meeting of the Board of Directors at which
action on any corporate matter is taken shall be presumed to have assented to
the action taken unless his dissent shall be entered in the minutes of the
meeting or unless he shall file his written dissent to such action with the
person acting as the secretary of the meeting before the adjournment thereof or
shall forward such dissent by registered mail to the secretary of the
corporation immediately after the adjournment of the meeting. Such right to
dissent shall not apply to a director who voted in favor of such action.



                                       4


                  Section 11. In addition to the powers and authorities by these
By-Laws expressly conferred upon it, the Board may exercise all such powers of
the corporation and do all such lawful acts and things as are not by statute or
by the Articles or by these By-Laws directed or required to be exercised or done
by the shareholders, including, but not limited to, the power by resolution
passed by a majority of the whole Board of Directors to elect one of its number
as Chairman and to delegate two or more of its number to constitute an executive
committee which shall have and exercise the authority of the Board of Directors
in the management of the business of the corporation, and to establish a
compensation committee as provided for in Section 9 or Article IV. Any action
which may be taken at a meeting of the directors or the members of the executive
committee may be taken without a meeting, if a consent or consents in writing
setting forth the action so taken shall be signed by all of the directors or the
members of the executive committee, as the case may be, and shall be filed with
the secretary of the corporation.

                                   ARTICLE IV
                                    Officers

                  Section 1. Number. The officers of the corporation shall be a
President, a Vice-President, a Secretary and a Treasurer, each of whom shall be
elected by the Board of Directors. Such other officers and assistant officers as
may be deemed necessary may be elected or appointed by the Board of Directors.
Nothing containing in these By-Laws shall preclude the Board of Directors from
electing members of the Board of Directors as officers of the corporation.

                  Section 2. Election and Term of Office. The officers of the
corporation to be elected by the Board of Directors shall be elected annually by
the Board of Directors at the first meeting of the Board of Directors held after
each annual meeting of the shareholders. If the election of officers shall not
be held at such meeting, such election shall be held as soon thereafter as
conveniently may be. Each officer shall hold office until his successor shall
have been duly elected and shall have qualified or until his death or until he
shall resign or shall have been removed in the manner hereinafter provided.

                  Section 3. Removal. Any officer or agent elected or appointed
by the Board of Directors may be removed by the Board of Directors whenever in
its judgment the best interests of the corporation would be served thereby, but
such removal shall be without prejudice to the contract rights, if any, of the
person so removed.

                  Section 4. Vacancies. A vacancy in any office because of
death, resignation, removal, disqualification or otherwise, may be filled by the
Board of Directors for the unexpired portion of the term.

                  Section 5. President. The president shall be the chief
executive officer of the corporation, and subject to the control of the Board of
Directors, shall in general supervise and control all of the business and
affairs of the corporation. He shall, when present, preside at all meetings of
the shareholders and of the Board of Directors. He may sign, with attestation by
the Secretary, Assistant Secretary or any other proper officer of the
corporation thereunto authorized by the Board of Directors, certificates for
shares of the corporation, which he is authorized, moreover, to endorse and
transfer, any deeds, mortgages, bonds, contracts, or other instruments



                                       5


which the Board of Directors has authorized to be executed, except in cases
where the signing and execution thereof shall be expressly delegated by the
Board of Directors or these By-Laws to some other officer or agent of the
corporation, or shall be required by law to be otherwise signed or executed; and
in general shall perform all duties incident to the office of President and such
other duties as may be prescribed by the Board of Directors from time to time.

                  Section 6. Vice-Presidents. In the absence of the President or
in the event of his death, inability or refusal to act, the Vice-Presidents in
the order determined by the Board of Directors shall perform the duties of the
President, and when so acting, shall have all the powers of and be subject to
all the restrictions upon the President. The Vice-Presidents shall perform such
other duties as from time to time may be assigned to him by the President or by
the Board of Directors.

                  Section 7. Secretary. The Secretary shall: (a) keep the
minutes of the shareholders' and of the Board of Directors' meetings in one or
more books provided for that purpose; (b) see that all notices are duly given in
accordance with the provisions of these By-Laws or as required by law; (c) be
custodian of the corporate records and of the seal of the corporation and see
that the seal of the corporation is affixed to all documents the execution of
which on behalf of the corporation under its seal is duly authorized; (d) keep a
register of the post office address of each shareholder which shall be furnished
to the Secretary by such shareholder; (e) have general charge of the stock
transfer books of the corporation; and (f) in general perform all duties
incident to the office of Secretary and such other duties as from time to time
may be assigned to him by the President or by the Board of Directors.

                  Section 8. Treasurer. If required by the Board of Directors,
the Treasurer shall give a bond for the faithful discharge of his duties in such
sum and with such surety or sureties as the Board of Directors shall determine.
He shall: (a) have charge and custody of and be responsible for all funds and
securities of the corporation; receive and give receipts for moneys due and
payable to the corporation from any source whatsoever, and deposit all such
moneys in the name of the corporation in such banks, trust companies or other
depositaries as shall be selected in accordance with the provisions of Article V
of these By-Laws; and (b) in general perform all of the duties incident to the
office of Treasurer and such other duties as from time to time may be assigned
to him by the President or by the Board of Directors.

                  Section 9. Compensation. The compensation of the officers
shall be fixed from time to time by the Board of Directors or by such
Compensation Committee as may be established by the Board of Directors to which
the Board of Directors shall delegate two or more members of the Board of
Directors and which shall have and exercise the authority of the Board of
Directors in fixing said compensation and no officer shall be prevented from
receiving such salary by reason of the fact that he is also a director of the
corporation.

                                    ARTICLE V
                                 Indemnification

                  Section 1. This corporation 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 (other than an action by or in



                                       6


the right of the corporation) by reason of the fact that he is or was a
director, officer, employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorney's fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he:
reasonably believed to be in, or not opposed to, the best interests of the
corporation and with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, conviction, or upon a
plea of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in, or not opposed to, the best interests of the
corporation, and, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.

                  Section 2. This corporation 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 corporation to procure a
judgment in its favor by reason of the fact that he is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against
expenses (including attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in, or not opposed to,
the best interests of the corporation and except that no indemnification shall
be made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable for negligence or misconduct in the performance
of his duty to the corporation unless and only to the extent that the Court of
Common Pleas of the county in which the registered office of the corporation is
located or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnify for such expenses which the Court of Common Pleas or such other court
shall deem proper.

                  Section 3. To the extent that a director, officer, employee or
agent of the corporation has been successful on the merits or otherwise in
defense of any action, suit or proceeding referred to in Sections 1 and 2 or in
defense of any claim, issue or matter therein, he shall be indemnified against
expenses (including attorneys' fees) actually and reasonably incurred by him in
connection therewith.

                  Section 4. Any indemnification under Sections 1 and 2 of this
Article V (unless ordered by a court) shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification of the
director, officer, employee or agent is proper in the circumstances because he
has met the applicable standard of conduct set forth in such section such
determination shall be made:

                  (a) By the Board of Directors by a majority vote of a quorum
consisting of directors who were not parties to such action, suit or proceeding,
or



                                       7


                  (b) If such a quorum is not obtainable, or, even if obtainable
a majority vote of a quorum of disinterested directors so directs, by
independent legal counsel in a written opinion, or

                  (c) By the shareholders.

                  Section 5. Expenses incurred in defending a civil or criminal
action, suit or proceeding may be paid by the corporation in advance of the
final disposition of such action, suit or proceeding as authorized in the manner
provided in Section 3 upon receipt of an undertaking by or on behalf of the
director, officer, employee or agent to repay such amount unless it shall
ultimately be determined that he is entitled to be indemnified by the
corporation as authorized in this Article.

                  Section 6. The indemnification provided by this Article shall
not be deemed exclusive of any other rights to which those seeking
indemnification may be entitled under any by-law, agreement vote of shareholders
or disinterested directors or otherwise, both as to action in his official
capacity and as to action in another capacity while holding such office, and
shall continue as to a person who has ceased to be a director, officer, employee
or agent and shall inure to the benefit of the heirs, executors and
administrators of such a person.

                  Section 7. The corporation shall have the power to purchase
and maintain insurance on behalf of any person who is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against any
liability asserted against him and incurred by him in any such capacity, or
arising out of his status as such, whether or not the corporation would have the
power to indemnify him against such liability under the provisions of this
Article.

                                   ARTICLE VI
                      Contracts Loans, Checks and Deposits

                  Section 1. Contracts. The Board of Directors may authorize any
officer or officers, agent or agents, to enter into any contract or execute and
deliver any instrument in the name of any on behalf of the corporation, and such
authority may be general or confined to specific instances.

                  Section 2. Loans. No loans shall be contracted on behalf of
the corporation and no evidences of indebtedness shall be issued in its name
unless authorized by a resolution of the Board of Directors. Such authority may
be general or confined to specific instances.

                  Section 3. Checks, drafts, etc. All checks, drafts and other
orders for the payment of money, notes or other evidences of indebtedness issued
in the name of the corporation, shall be signed by such officer or officers,
agent or agents of the corporation and in such manner as shall from time to time
be determined by resolution of the Board of Directors.

                  Section 4. Deposits. All funds of the corporation not
otherwise employed shall be deposited from time to time to the credit of the
corporation in such banks, trust companies or other depositaries as the Board of
Directors may select.



                                       8


                                  ARTICLE VII
                   Certificates For Shares and Their Transfer

                  Section 1. Certificates for Shares. Certificates representing
shares of the corporation shall be in such form as shall be signed by the
President and by the Secretary or by such other officers authorized by law and
by the Board of Directors so to do and shall be sealed with the corporate seal
which may be facsimile, engraved or printed but where such share certificate is
signed by a transfer agent or registrar the signature of any corporate officer
upon such certificate may be facsimile, engraved or printed. In case any officer
who has signed, or whose facsimile signature has been placed upon any share
certificate shall have ceased to be such officer because of death, resignation,
or otherwise, before the certificate is issued, it may be issued by the
corporation with the same effect as if the officer had not ceased to be such at
the date of its issue. All certificates shall be consecutively numbered or
otherwise identified. The name and address of the person to whom the shares
represented thereby are issued, with the number of shares and date of issue,
shall be entered on the stock transfer books of the corporation. All
certificates surrendered to the corporation for transfer shall be cancelled and
no new certificate shall be issued until the former certificate for a like
number of shares shall have been surrendered and cancelled, except that in case
of a lost, destroyed or mutilated certificate a new one may be issued therefor
upon such terms and indemnity to the corporation as the Board of Directors may
prescribe.

                  Section 2. Transfer of Shares. Transfer of shares of the
corporation shall be made only on the stock transfer books of the corporation by
the holder of record thereof or by his legal representative, who shall furnish
proper evidence of authority to transfer, or by his attorney thereunto
authorized by power of attorney duly executed and filed with the Secretary of
the corporation, and on surrender for cancellation of the certificate for such
shares. The person in whose name shares stand on the books of the corporation
shall be deemed by the corporation to be the owner thereof for all purposes.

                                  ARTICLE VIII
                                   Fiscal Year

                  The fiscal year of the corporation shall begin on the first
day of January and end on the 31st day of December in each year.

                                   ARTICLE IX
                                    Dividends

                  Dividends upon the shares of the Corporation, subject to the
provisions of the Articles of Incorporation, if any, may be declared by the
Board of Directors at any regular or special meeting, pursuant to law. Dividends
may be paid in cash, in property, or in its shares, subject to the provisions of
the Articles of Incorporation.



                                       9


                                   ARTICLE X
                                      Seal

                  The Board of Directors shall provide a corporate seal which
shall be circular in form and shall have inscribed thereon the name of the
corporation and the State of incorporation and the words, "Corporate Seal".

                                   ARTICLE XI
                                Waiver of Notice

                  Unless otherwise provided by law, whenever any notice is
required to be given to any shareholders or director of the corporation under
the provisions of these By-Laws or under the provisions of the Articles of
Incorporation, a waiver thereof in writing, signed by the person or persons
entitled to such notice, whether before or after the time stated therein, shall
be deemed equivalent to the giving of such notice.

                                  ARTICLE XII
                                   Amendments

                  These By-Laws may be altered, amended or repealed and new
By-Laws may be adopted by a vote of the shareholders representing a majority of
the total voting power set forth in Section 8 of Article II of all the shares
issued and outstanding, at any annual shareholders' meeting or at any special
shareholders' meeting when the proposed amendment has been set out in the notice
of such meeting, or by a majority vote of the members of the Board of Directors
at any regular or special meeting, duly convened after notice to the Directors
of that purpose, subject always to the power of the shareholders to change such
action by the Directors.



                                       10

EX-3.32

                                                                    EXHIBIT 3.32


                       CERTIFICATE OF LIMITED PARTNERSHIP

         In compliance with the requirements of the Delaware Limited Partnership
Act, Title 6, Chapter 17 of the Delaware Code (relating to certificate of
limited partnership), the undersigned, desiring to form a limited partnership,
hereby certifies that:

1.       The name of the limited partnership is:     Eldercrest Care, LP

2.       The address of this limited partnership's initial registered office is:


         111 West Michigan Street,       Milwaukee,       WI              53203              Milwaukee
         -------------------------------------------------------------------------------------------------
            Number and Street              City          State             Zip                County



3.       The address of this limited partnership's registered agent upon whom
         process may be served is:


         Lexis Document Services Inc.
         30 Old Rudnick Lane, Suite 100,      Dover,        DE            19901             Kent
         --------------------------------------------------------------------------------------------------
             Number and Street                City         State           Zip            County



4.       The name and business address of each general partner of the
         partnership is:


         Name                               Address

         Coventry Care Holdings, Inc.       111 West Michigan Street, Milwaukee, WI  53203




5.       The formation of the limited partnership shall be effective upon filing
         this Certificate of Limited Partnership with the Office of the
         Secretary of State.

EX-3.33

                                                                    EXHIBIT 3.33

                           ARTICLES OF INCORPORATION
                                       OF
                               ELDER CREST, INC.

                  In compliance with the requirements of the Business
Corporation Law, approved the 5th day of May, A.D. 1933, P.L. 364, as amended,
the undersigned, desiring that they may be incorporated as a business
corporation, do hereby certify:

                  1. The name of the corporation is: Elder Crest, Inc.

                  2. The location and post office address of its registered
office in this Commonwealth is:

   1330 Grant Building                       Pittsburgh           Allegheny
- --------------------------------------------------------------------------------
          Number            Street              City               County

                  3. The purpose or purposes of the corporation are: To operate
private nursing homes or convalescent homes for the accommodation of
convalescents or other persons requiring nursing care and medical services and
treatment by reason of sickness, infirmity or other disability in accordance
with local, state and Federal laws and regulations; and for these purposes to
purchase, lease or otherwise acquire real estate necessary to the operation and
maintenance of nursing and convalescent homes and to build, erect, alter, lease,
equip and operate and maintain nursing and convalescent homes and buildings
thereon; this corporation shall have the authority to apply for and obtain or
cause to be obtained a loan to be insured by the Federal Housing Commissioner
hereinafter called the "Commissioner", pursuant to the provisions of Section 232
of the National Housing Act, as amended, as it applies to housing specially
designed for use as a nursing home, to be secured by a mortgage or other lien;
notwithstanding any other provision contained herein the corporation formed
hereby is authorized to enter into a contract (Regulatory Agreement) with the
Federal Housing Commissioner and shall be bound by the terms thereof to enable
the Commissioner to carry out the provisions of the National Housing Act, as
amended. Upon execution, the contract (Regulatory Agreement) shall be binding
upon the corporation, its successors and assigns, so long as a mortgage executed
by the corporation is outstanding, unpaid, and insured or held by the Federal
Housing Commissioner.

                  4. The term of its existence is perpetual.

                  5. The aggregate number of shares which the corporation shall
have authority to issue is 1500 shares of common stock having a par value of
$100.00 per share.






                  6. The names and address of each of the first directors are:

             NAME                                 ADDRESS
                                     (Including street and number, if any)
       George H. McShane           424 Union Street, Munhall, Pennsylvania
      Delmer V. Forsberg           147 Allan Street, Beaver Falls, Pennsylvania
    John H. Wilkinson, M.D.        3646 Forest Avenue, Munhall, Pennsylvania
   Robert W. McDermott, M.D.       1507 Mifflin Road, Pittsburgh 7, Pennsylvania
      Charles J. Spinelli          3814 Chester Street, Munhall, Pennsylvania


                  7. The names and addresses of each of the incorporators and
the number and class of shares subscribed by each are:


                                                                   NO. AND CLASS
        NAME                               ADDRESS                   OF SHARES
- --------------------------------------------------------------------------------
George H. McShane                     424 Union Street,
                                    Munhall, Pennsylvania               50

Robert W. Mcdermott, M.D.            1507 Mifflin Road,
                                 Pittsburgh 7, Pennsylvania             50

John H. Wilkinson, M.D.              3646 Forest Avenue
                                    Munhall, Pennsylvania               50


                                       2

EX-3.34

                                                                    EXHIBIT 3.34


                                    BY-LAWS
                                       OF
                               ELDER CREST, INC.

                                    ARTICLE I
                                NAME AND LOCATION

                  Section 1. The name of this corporation shall be ELDER CREST,
INC.

                  Section 2. Its principal office shall be located at 1330 Grant
Building, Pittsburgh 19, Allegheny County, Pennsylvania.

                  Section 3. Other offices for the transaction of business shall
be located at such places as the Board of Directors may from time to time
determine.

                                   ARTICLE II
                                  CAPITAL STOCK

                  Section 1. The amount of the capital stock shall be
$150,000.00, which shall be divided into 1500 shares, of the value of $100.00
each.

                  Section 2. All certificates of stock shall be signed by the
President and the Treasurer and shall be sealed with the corporate seal.

                  Section 3. Treasury stock shall be held by the corporation
subject to the disposal of the Board of Directors, and shall neither vote nor
participate in dividends.

                  Section 4. The corporation shall have a first lien on all the
shares of its capital stock, and upon all dividends declared upon the same, for
any indebtedness of the respective holders thereof to the corporation.

                  Section 5. Transfers of stock shall be made only on the books
of the corporation; and the old certificate, properly endorsed, shall be
surrendered and cancelled before a new certificate is issued. The stockbooks of
the corporation shall be closed against transfers for a period of thirty (30)
days before the day of payment of a dividend and for ten (10) days before each
annual meeting of the stockholders.

                  Section 6. In case of loss or destruction of a certificate of
stock, no new certificate shall be issued in lieu thereof except upon
satisfactory proof to the Board of Directors of such loss or destruction; and
upon the giving of satisfactory security, by bond or otherwise, against loss to
the corporation. Any such new certificate shall be plainly marked "Duplicate"
upon its face.



                                   ARTICLE III
                             STOCKHOLDERS' MEETINGS

                  Section 1. The annual meeting of the stockholders shall be the
fourth week of March per Shareholder Action dated December 1, 1994. At such
meeting the stockholders shall elect directors to serve until their successors
shall be elected and qualified.

                  Section 2. A special meeting of the stockholders, to be held
at the same place as the annual meeting, may be called at any time by the
President, and in his absence by the Vice President; or by the Directors. It
shall be the duty of the Directors, President or Vice President to call such a
meeting whenever so requested by stockholders holding 51% or more of the capital
stock.

                  Section 3. Notice of the time and place of all annual and
special meetings shall be mailed by the Secretary to each stockholder ten (10)
days before the date thereof.

                  Section 4. The President, or, in his absence, the Vice
President, shall preside at all such meetings.

                  Section 5. At every such meeting each stockholder shall be
entitled to cast one vote for each share of voting stock held in his name; which
vote may be cast by him either in person, or by proxy. All proxies shall be in
writing, and shall be filed with the Secretary and by him entered of record in
the minutes of the meeting.

                  Section 6. Every stockholder shall have the right to vote, in
person or by proxy, for the number of shares of stock owned by him, for as many
persons as there are directors or managers to be elected, or to cumulate said
shares and give one candidate as many votes as the number of directors
multiplied by the number of his shares of stock shall equal, or to distribute
them on the same principle among as many candidates as he shall think fit.

                                   ARTICLE IV
                                    DIRECTORS

                  Section 1. The number of authorized Directors of the
corporation shall be not less than 1 nor more than 15, fixed from time to time
by the shareholders. The Directors shall be elected at the annual meeting of the
shareholders and each Director shall be elected to serve until his successor
shall be elected and shall qualify.

                  Section 2. The Directors shall be elected annually by the
stockholders at the annual meeting and shall hold office for one year or until
their successors are duly elected and qualified.

                  Section 3. The regular meetings of the Directors shall be held
in the principal office of the corporation immediately after the adjournment of
each annual stockholders' meeting; and also on the first Monday of January,
April, July and October of each year at the hour of 4:00 o'clock P.M. Provided,
however, that whenever such day shall fall upon a legal holiday, the meeting
shall be held on the next succeeding business day.


                                       2

                  Section 4. Special meetings of the Board of Directors, to be
held in the principal office of the corporation, may be called by the President;
and in his absence by the Vice President; or by any three (3) members of the
Board. By unanimous consent of the Directors, special meetings of the Board may
be held without notice, at any time and place.

                  Section 5. Notice of all regular and special meetings, except
those specified in the second sentence of Section 4 of this article, shall be
mailed to each Director by the Secretary at least ten (10) days previous to the
time fixed for the meeting. All notices of special meetings shall state the
purpose thereof.

                  Section 6. A quorum for the transaction of business at any
regular or special meeting of the Directors shall consist of three (3) members
of the Board; but a majority of those present at any regular or special meeting
shall have power to adjourn the meeting to a future time.

                  Section 7. The Directors shall elect the officers of the
corporation, and fix their salaries; such election to be held at the directors'
meeting following each annual stockholders' meeting. An officer may be removed
at any time by a two-thirds vote of the full Board of Directors.

                  Section 8. Vacancies in the Board of Directors may be filled
for the unexpired terms by the remaining directors at any regular or special
directors' meeting.

                  Section 9. The Directors may, by resolution, appoint members
of the Board as an executive committee, to manage the business of the
corporation during the interim between meetings of the Board.

                  Section 10. At each annual stockholders' meeting the Directors
shall submit a statement of the business done during the preceding year,
together with a report of the general financial condition of the corporation,
and of the condition of its tangible property.

                                    ARTICLE V
                                    OFFICERS

                  Section 1. The officers of this corporation shall be a
President, a Vice President, a Secretary and a Treasurer, who shall be elected
for the term of one year, and shall hold office until their successors are duly
elected and qualified. No one shall be eligible to the office of President or
Vice President who is not a director of the corporation; and any such officer
who ceases to be a director shall cease to hold office as President or Vice
President as soon as his successor is elected and qualified. The offices of
Secretary and Treasurer may be held by one person.

                  Section 2. The President shall preside at all directors' and
stockholders' meetings; shall have general supervision over the affairs of the
corporation and over the other officers; shall sign all stock certificates and
written contracts of the corporation, and countersign all checks; and shall
perform all such other duties as are incident to his office. In case of the
absence or disability of the President, his duties shall be performed by the
Vice President.


                                       3

                  Section 3. The Secretary shall issue notices of all directors'
and stockholders' meetings, and shall attend and keep the minutes of the same;
shall have charge of all corporate books, records and papers; shall be custodian
of the corporate seal; shall attest with his signature, and impress with the
corporate seal, all stock certificates and written contracts of the corporation;
and shall perform all such other duties as are incident to his office.

                  Section 4. The Treasurer shall have custody of all money and
securities of the corporation and shall give bond, in such sum and with such
sureties as the Directors may require, conditioned upon the faithful performance
of the duties of his office. He shall keep regular books of account and shall
submit them, together with all his vouchers, receipts, records and other papers,
to the Directors for their examination and approval as often as they may
require; and shall perform all such other duties as are incident to his office.

                                   ARTICLE VI
                              DIVIDENDS AND FINANCE

                  Section 1. Dividends, to be paid out of the surplus earnings
of the corporation, may be declared from time to time by resolution of the Board
of Directors; but no dividend shall be paid that will impair the capital of the
corporation.

                  Section 2. The funds of the corporation shall be deposited in
such bank or trust company as the directors shall designate, and shall be
withdrawn only upon the signatures of any of the two following officers:
President or Secretary.

                                   ARTICLE VII
                                   FISCAL YEAR

                  Section 1. The fiscal year of the Corporation shall begin on
the first day of May in each year.

                                  ARTICLE VIII
                                   AMENDMENTS

                  Section 1. These By-Laws may be altered or repealed and
By-Laws may be made at any annual meeting of the stockholders or at any special
meeting thereof if notice of the proposed alteration or repeal or By-Law or
By-Laws to be made be contained in the notice of such special meeting, by the
affirmative vote of a majority of the stock issued and outstanding and entitled
to vote thereat, or by the affirmative vote of a majority of the Board of
Directors, at any regular or special meeting of the Board of Directors.



                                       4

EX-3.35

                                                                    EXHIBIT 3.35

                          CERTIFICATE OF INCORPORATION

                                       OF

                          EXTENDICARE GREAT TRAIL, INC.


                  1. The name of the corporation is:

                          EXTENDICARE GREAT TRAIL, INC.

                  2. The address of its registered office in the State of
Delaware is Corporation Trust Center, 1209 Orange Street, in the City of
Wilmington, County of New Castle. The name of its registered agent at such
address is The Corporation Trust Company.

                  3. The nature of the business or purposes to be conducted or
promoted is to engage in any lawful act or activity for which corporations may
be organized under the General Corporation Law of Delaware.

                  4. The total number of shares of stock which the corporation
shall have authority to issue is One Thousand (1,000) and the par value of each
of such shares is One Dollar and No Cents ($1.00) amounting in the aggregate to
One Thousand Dollars and No Cents ($1,000.00).

                  5. The board of directors is authorized to make, alter or
repeal the by-laws of the corporation. Election of directors need not be by
written ballot.

                  6. The name and mailing address of the incorporator is:

                            M.C. Kinnamon
                            Corporation Trust Center
                            1209 Orange Street
                            Wilmington, Delaware 19801

                  7. A director of the corporation shall not be personally
liable to the corporation or its stockholders for monetary damages for breach of
fiduciary duty as a director except for liability (i) for any breach of the
directors duty of loyalty to the corporation or its stockholders, (ii) for acts
or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) under Section 174 of the Delaware General
Corporation Law, or (iv) for any transaction from which the director derived any
improper personal benefit.

                  8. The corporation shall indemnify its officers, directors,
employees and agents to the extent permitted by the General Corporation Law of
Delaware.

                  9.1. The Corporation shall be a "sole asset entity" as
required by the Secretary of Housing and Urban Development, whose sole asset
shall be Great Trail Care Center located at 400 Carolyn Court, Minerva, Carroll
County, Ohio ("Project").






                  9.2. The Corporation shall not be voluntarily dissolved prior
to December 31, 2046.

                  9.3. Notwithstanding anything else to the contrary stated in
the Articles of Incorporation, the Corporation shall not indemnify any Person
except to the extent mandated by state law and/or to the extent that such
indemnification is limited to liability insurance coverage or distribution
approved by HUD from residual receipts or surplus cash.

                  9.4 Notwithstanding any other provision in the Articles of
Incorporation to the contrary, as long as the Secretary of the Department of
Housing and Urban Development ("Secretary) or the Secretary's successors or
assigns is the insurer or holder of the note secured by the mortgage on the
Project. No amendment to the Articles of Incorporation that result in any of the
following will have any force or effect without the prior written consent of the
Secretary:

                  (a) Any amendment that modifies the term of the Corporations
existence;

                  (b) Any amendment that activates the requirement that a HUD
Previous Participation Certification be obtained from any additional Shareholder
or other Person;

                  (c) Any amendment that in any way affects the note, mortgage,
or security agreement on the Project or the Regulatory Agreement between HUD and
the Corporation (the "Regulatory Agreement');

                  (d) Any amendment that would authorize any Person other than
the previously authorized Officers to bind the Corporation for all matters
concerning the Project with required HUD's consent or approval;

                  (e) A change in the voting control of the Shareholder(s) of
the Corporation;

                  (f) Any change in the guarantor(s) of any obligation to the
Secretary; or

                  (g) Any amendment to these Articles of Incorporation.

                  9.5. Authority of Corporation. The Corporation is authorized
to execute a note, mortgage and security agreement in order to secure a loan to
be insured by the Secretary and to execute the Regulatory Agreement and other
documents required in connection with the HUD-insured loan.

                  9.6. Issuance of New Shares. No shares shall be issued with at
least a 25% voting control unless the holder of such shares shall meet the
applicable requirements for HUD previous participation clearance. Any such new
Shareholder shall, as a condition of receiving an interest in the Corporation,
agree to be bound by the note, mortgage, security agreement, the Regulatory
Agreement and any other documents required in connection with the HUD-insured
loan to the same extent and on the same terms as the other Shareholders.

                  9.7. Transfers Upon Dissolution. Notwithstanding any other
provisions of these Articles of Incorporation, upon any dissolution, no title,
or right to possession and control


                                       2



of the Project, and not right to collect the rents from the Project, shall pass
to any Person who is not bound by the Regulatory Agreement in a manner
satisfactory to the Secretary.

                  9.8. Conflicts With Note or Regulatory Agreement.
Notwithstanding any other provisions of the Articles of Incorporation, if any of
the provisions of the organizational documents conflict with the terms of the
note, mortgage, deed of trust or security deed, security agreement, HUD
Regulatory Agreement or other documents that may be required by HUD (the "HUD
Loan Documents"), the provisions of the HUD Loan Documents shall control.

                  9.9. No Voluntary Dissolution. So long as the Secretary's
successors or assigns is the insurer or holder of the note on the Project, the
Corporation may not voluntarily be dissolved or disassociated or changed to
another type of entity without the prior written approval of the Secretary, and
any Shareholder may not be voluntarily changed to a limited liability company or
partnership.

                  9.10. Personal Liability. The Shareholder(s), and any assignee
of a Shareholder, agree to be liable in their individual capacities to HUD with
respect to the following matters:

                  (a) For funds or property of the Project coming into their
hands, which by the provisions of the Regulatory Agreement, they are not
entitled to retain; and

                  (b) For their own acts and deeds, or acts and deeds of others
which they have authorized, in violation of the provisions of the Regulatory
Agreement.

                  (c) For their acts which violate statutes governing the
conduct of owners of multifamily projects with FHA-insured mortgages.

                  9.11. Corporation Representatives. Each Officer is authorized
to represent and bind the Corporation with respect to all matters concerning the
Project which require the consent or approval of the Secretary. The signature of
any one Officer shall bind the Corporation in all such matters. If the
Corporation representatives under this article XIII are changed at any time, the
Corporation shall provide the Secretary with written notification of the name,
address and telephone number of the new representative(s) within three (3)
business days of such change.


                                       3

EX-3.36

                                                                    EXHIBIT 3.36

                                     BY-LAWS
                                       OF
                          EXTENDICARE GREAT TRAIL, INC.

                                    ARTICLE I
                                     OFFICES

                  Section 1. Registered Office. The address of the registered
office in the State of Delaware is Corporation Trust Center, 1209 Orange Street,
in the City of Wilmington, County of New Castle. The name of its registered
agent at such address is The Corporation Trust Company.

                  Section 2. Other Offices. The corporation may have other
offices, either within or without the State of Wisconsin, at such place or
places as the Board of Directors may from time to time appoint or the business
of the corporation may require.

                                   ARTICLE II
                            MEETINGS OF STOCKHOLDERS

                  Section 1. Annual Meetings. Annual meetings of stockholders
for the election of directors and for such other business as may properly come
before the meeting shall be held at such place, either within or without the
State of Wisconsin, as the Board of Directors shall determine and as set forth
in the notice of the meeting.

                  Annual meetings of stockholders shall be held during the
fourth week of March in each year at a time and date to be determined by the
Board of Directors. At each annual meeting, the stockholders shall elect a Board
of Directors and they may transact such other business as may properly come
before the meeting.

                  Section 2. Other Meetings. Meetings of stockholders for any
purpose or purposes may be called by the President, the Secretary, the Board of
Directors or such other persons as may be authorized by law, and shall be held
at such time and place, within or without the State of Wisconsin, as shall be
stated in the notice of meeting.

                  Section 3. Voting. Each stockholder entitled to vote in
accordance with the terms of the Articles of Incorporation and in accordance
with the provisions of these By-Laws shall be entitled to one vote, in person or
by proxy, executed in writing by the stockholder or by its duly authorized
attorney in fact, for each share of stock entitled to vote held by such
stockholder. All elections for directors shall be decided by plurality vote; all
other questions shall be decided by majority vote except as otherwise provided
by the Articles of Incorporation or the laws of the State of Wisconsin.

                  Section 4. Quorum. Except as otherwise required by Law, by the
Articles of Incorporation or by these By-Laws, the presence, in person or by
proxy, of stockholders holding a majority of the stock of the corporation
entitled to vote shall constitute a quorum at all meetings of the stockholders.
In case a quorum shall not be present at any meeting, a majority in interest of
the stockholders entitled to vote thereat, present in person or by proxy, shall
have power to adjourn the meeting from time to time, without notice other than
announcement at the


meeting until the requisite amount of stock entitled to vote shall be present;
provided, that if the adjournment is for more than thirty days or if after the
adjournment a new record date is fixed for the adjourned meeting, a notice of
the adjourned meeting will be sent to each stockholder of record entitled to
vote at the meeting, as adjourned. At any such adjourned meeting at which the
requisite amount of stock entitled to vote shall be represented, any business
may be transacted which might have been transacted at the meeting as originally
noticed, but only those stockholders entitled to vote at the meeting as
originally noticed shall be entitled to vote at any adjournment or adjournments
thereof, unless a new record date therefor shall have been fixed.

                  Section 5. Notice of Meetings. Written notice, stating the
place, date and time of any special meeting, and the purpose or purposes for
which such meeting has been called, shall be given to each stockholder entitled
to vote thereat at this address as it appears on the records of the corporation,
not less than ten nor more than fifty days before the date of the meeting.
Regular meetings of the Board of Directors may be held without notice of the
date, time, place or purpose of the meeting.

                  Section 6. Action without Meeting. Any action required to be
taken at any annual or special meeting of stockholders, or any action which may
be taken at any annual or special meeting, may be taken without a meeting,
without prior notice and without a vote, if a consent in writing, setting forth
the action so taken, shall be signed by the holders of all of the outstanding
stock of the corporation.

                                   ARTICLE III
                                    DIRECTORS

                  Section 1. Number and Term. The number of authorized Directors
of the Corporation shall be not less than 1 nor more than 15, fixed from time to
time by the Shareholder. The Directors shall be elected at the annual meeting of
the Shareholders and each Director shall be elected to serve until his successor
shall be elected and shall qualify.

                  Section 2. Resignations. Any director, member of a committee,
or other officers may resign at any time. Such resignation shall be made in
writing, and shall take effect at the time specified therein, and if no time be
specified, at the time of its receipt by the President or Secretary. The
acceptance of a resignation shall not be necessary to make it effective.

                  Section 3. Powers. The Board of Directors shall exercise all
of the powers of the corporation except such as are by law, or by the Article of
Incorporation of the corporation or by these By-Laws conferred upon or reserved
to the stockholders.

                  Section 4. Meetings. The newly elected directors may hold
their first meeting for the purpose of the transaction of business, if a quorum
be present, immediately after the annual meeting of the stockholders; or the
time and place of such meeting may be fixed by consent in writing of all the
directors.

                  Regular meetings of the directors may be held without notice
at such places and times as shall be determined from time to time by resolution
of the directors.




                                       2

                  Special meetings of the board may be called by or at the
request of the President, the Secretary or any two directors. Such meeting shall
be held at such place or places as shall be stated in the call of the meeting.
Notice of any special meeting shall be given at least six (6) hours previously
thereto in any one of the following methods: by oral or telephonic notice, by
written notice delivered personally or mailed to each director at his business
address, or by telegram; provided, that if notice is given by mail only, it
shall be given at least forty-eight (48) hours prior to such meeting. If mailed,
such notice shall be deemed to be delivered when deposited in the United States
mail so addressed, with postage thereon prepaid. If notice is given by telegram,
such notice shall be deemed delivered when the telegram is delivered to the
telegraph company. Whenever any notice whatever is required to be given to any
director of the corporation under the Certificate of Incorporation of these
By-Laws or any provision of law, a waiver thereof in writing, signed at any
time, whether before or after the time of the meeting, by the director entitled
to such notice, shall be deemed equivalent to the giving of such notice.

                  Members of the Board of Directors, or any committee designated
by the Board of Directors, may participate in a meeting of the Board of
Directors, or any committee, by means of conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other, and such participation in a meeting shall
constitute presence in person at the meeting.

                  Section 5. Committees. The Board of Directors may, by
resolution or resolutions passed by a majority of the whole board, designate one
or more committees, each committee to consist of three or more directors of the
corporation. The board may designate one or more directors as alternate members
of any committee, who may replace any absent or disqualified member at any
meeting of the committee. In the absence or disqualification of any member of
such committee or committees, the member or members thereof present at any
meeting and not disqualified from voting, whether or not he or they constitute a
quorum, may unanimously appoint another member of the Board of Directors to act
at the meeting in the place of any such absent or disqualified member.

                  Any such committee, to the extent provided in the resolution
of the Board of Directors, or in these By-Laws, shall have and may exercise all
the powers and authority of the Board of Directors in the management of the
business and affairs of the corporation; and may authorize the seal of the
corporation to be affixed to all papers which may require it; but no such
committee shall have the power or authority in reference to amending the
Articles of Incorporation, adopting an agreement of merger or consolidation,
recommending to the stockholders the sale, lease or exchange of all or
substantially all of the corporation's property and assets, recommending to the
stockholders a dissolution of the corporation or a revocation of a dissolution,
or amending the By-Laws of the corporation and, unless the resolution, these
By-Laws, or the Certificate of Incorporation expressly so provide, no such
committee shall have the power of authority to declare a dividend or to
authorize the issuance of stock.

                  Section 6. Quorum. A majority of the directors shall
constitute a quorum for the transaction of business. If at any meeting of the
board there shall be less than a quorum present, a majority of those present may
adjourn the meeting from time to time until a quorum is obtained, and no further
notice thereof need be given other than by announcement at the meeting which
shall be so adjourned.




                                       3

                                   ARTICLE IV
                                    OFFICERS

                  Section 1. Officers. The officers of the corporation shall be
a President, a Treasurer, and a Secretary, all of whom shall hold office until
their successors are elected and qualified or until their earlier termination,
death, resignation or removal. In addition, the Board of Directors may elect a
Chairman, Chief Executive Officer, one or more Vice-Presidents and such
Assistant Secretaries and Assistant Treasurers as they may deem proper. None of
the officers of the corporation need be directors. The officers shall be elected
at the first meeting of the Board of Directors after each annual meeting. More
than two offices may be held by the same person, except for the offices of
President and Vice-President and the offices of President and Secretary.

                  Section 2. Other Officers and Agents. The Board of Directors
may appoint such other officers and agents as it may deem advisable, who shall
hold their offices for such terms and shall exercise such powers and perform
such duties as shall be determined from time to time by the Board of Directors.

                  Section 3. Chairman. The Chairman of the Board of Directors,
if one be elected, shall preside at all meetings of the Board of Directors and
he shall have and perform such other duties as from time to time may be assigned
to him by the Board of Directors.

                  Section 4. President. The President shall have the general
powers and duties of supervision and management usually vested in the office of
President of a corporation. He shall preside at all meetings of the stockholders
if present thereat, and in the absence or non-election of the Chairman of the
Board of Directors, at all meetings of the Board of Directors, and shall have
general supervision, direction and control of the business of the corporation.
Except as the Board of Directors shall authorize the execution thereof in some
other manner, he shall execute bonds, mortgages and other contracts in behalf of
the corporation, and shall cause the seal to be affixed to any instrument
requiring it and when so affixed the seal shall be attested by the signature of
the Secretary or the Treasurer or an Assistant Secretary or an Assistant
Treasurer.

                  Section 5. Vice-President. Each Vice-President shall have such
powers and shall perform such duties as shall be assigned to him by the Board of
Directors, or if no such powers and duties shall be assigned by the Board of
Directors, then such powers and duties as shall be assigned to him by the
Chairman of the Board of Directors or the President.

                  Section 6. Treasurer. The Treasurer shall have the custody of
the corporate funds and securities and shall keep full and accurate account of
receipts and disbursements in books belonging to the corporation. He shall
deposit all moneys and other valuables in the name and to the credit of the
corporation in such depositaries as may be designated by the Board of Directors.

                  The Treasurer shall disburse the funds of the corporation as
may be ordered by the Board of Directors, or the President, taking proper
vouchers for such disbursements. He shall render to the President and Board of
Directors at the regular meetings of the Board of Directors,


                                       4

or whenever they may request it, an account of all his transactions as Treasurer
and of the financial condition of the corporation. If required by the Board of
Directors, he shall give the corporation a bond for the faithful discharge of
his duties in such amount and with such surety as the Board of Directors shall
prescribe.

                  Section 7. Secretary. The Secretary shall give, or cause to be
given, any required notice of meetings of stockholders and directors, and all
other notices required by law or by these By-Laws, and in case of his absence or
refusal or neglect so to do, any such notice may be given by any person
thereunto directed by the President, or by the Board of Directors, or
stockholders, upon whose requisition the meeting is called as provided in these
By-Laws. He shall record all the proceedings of the meetings of the corporation
and of the directors in a book to be kept for that purpose, and shall perform
such other duties as may be assigned to him by the directors or the President.
He shall have the custody of the seal of the corporation and shall affix the
same to all instruments requiring it, when authorized by the Board of Directors
or the President, and attest the same.

                  Section 8. Assistant Treasurers and Assistant Secretaries.
Assistant Treasurers and Assistant Secretaries, if any, shall be elected and
shall have such powers and shall perform such duties as shall be assigned to
them, respectively, by the directors.

                                    ARTICLE V
                                  MISCELLANEOUS

                  Section 1. Certificates of Stock. Certificates of stock,
signed by the President or Vice-President and Secretary or any Assistant
Secretary, shall be issued to each stockholder certifying the number of shares
owned by such stockholder in the corporation. Any or all of the signatures may
be facsimiles.

                  Section 2. Transfer of Shares. The shares of stock of the
corporation shall be transferable only upon its books by the holders thereof in
person or by their duly authorized attorneys or legal representatives, and upon
such transfer the old certificates shall be surrendered to the corporation by
the delivery thereof to the person in charge of the stock and transfer books and
ledgers, or to such other person as the directors may designate, by whom they
shall be canceled, and new certificates shall thereupon be issued. A record
shall be made of each transfer and whenever a transfer shall be made for
collateral security, and not absolutely, it shall be so expressed in the entry
of the transfer.

                  Section 3. Stockholders Record Date. In order that the
corporation may determine the stockholders entitled to notice of or to vote at
any meeting of stockholders or any adjournment thereof, or to express consent to
corporate action in writing without a meeting, or entitled to receive payment of
any dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect to any change, conversion or exchange of stock or
for the purpose of any other lawful action, the Board of Directors may fix, in
advance, a record date, which shall not be more than fifty nor less than ten
days before the date of such meeting nor more than fifty days prior to any other
action. A determination of stockholders of record entitled to notice of or to
vote at a meeting of stockholders shall apply to any adjournment of the




                                       5

meeting; provided, however, that the Board of Directors may fix a new record
date for the adjourned meeting.

                  Section 4. Seal. The corporate seal shall be circular in form
and shall contain the name of the corporation, its state of incorporation and
the words "CORPORATE SEAL." Said seal may be used by causing it or a facsimile
thereof to be impressed or affixed or reproduced otherwise.

                  Section 5. Fiscal Year. The fiscal year of the corporation
shall be the calendar year.

                  Section 6. Checks. All checks, drafts or other orders for the
payment of money, notes or other evidences of indebtedness issued in the name of
the corporation shall be signed by such officer or officers, agent or agents of
the corporation, and in such manner as shall be determined from time to time by
resolution of the Board of Directors.

                  Section 7. Indemnification. The corporation may indemnify its
incorporator, officers, directors, employees and agents to the full extent
permitted by law.

                  Section 8. Notice and Waiver of Notice. Whenever, under the
provisions of law, the Articles of Incorporation or these By-Laws, notice is
required to be given to any person, it shall not be construed to mean personal
notice, but such notice may be given in writing, by mail, addressed to such
person at his address as it appears on the records of the corporation, with
postage thereon prepaid, and such notice shall be deemed to be given at the time
when the same shall be deposited in the United States mail. Notice to directors
may also be given by any of the methods specified in Article III, Section 4, of
these By-Laws.

                  Whenever any notice whatever is required to be given under the
provisions of any law, the Articles of Incorporation or these By-Laws, a waiver
thereof in writing, signed by the person or persons entitled to said notice,
whether before or after the time stated therein, shall be deemed equivalent
thereto. Any waiver of notice to stockholders shall set forth in reasonable
detail the purpose or purposes for which the meeting is called and the time and
place thereof. Attendance by a director or stockholder at any meeting of
directors or stockholders, respectively, shall constitute a waiver of notice of
such meeting, except where such director or stockholder attends a meeting for
the express purpose of objecting, at the beginning of such meeting, to the
transaction of business because the meeting is not lawfully called or convened.

                                   ARTICLE VI
                                   AMENDMENTS

                  These By-Laws may be altered or repealed and By-Laws may be
made at any annual meeting of the stockholders or at any special meeting thereof
if notice of the proposed alteration or repeal or By-Law or By-Laws to be made
be contained in the notice of such special meeting, by the affirmative vote of a
majority of the stock issued and outstanding and entitled to vote thereat, or by
the affirmative vote of a majority of the Board of Directors, at any regular or
special meeting of the Board of Directors.




                                       6

EX-3.37

                                                                    EXHIBIT 3.37


                            ARTICLES OF INCORPORATION
                                       OF
                       EXTENDICARE HEALTH FACILITIES, INC.


                  Executed by the undersigned for the purpose of forming a
Wisconsin corporation under Chapter 180 of the Wisconsin statutes:

                  Article 1. The name of the Corporation shall be Extendicare
Health Facilities, Inc.

                  Article 2. The period of existence shall be perpetual.

                  Article 3. The purposes shall be to engage in any lawful
activities authorized in Chapter 180.

                  Article 4. The number of shares which it shall have authority
to issue, itemized by classes, par value of shares, shares without par value,
and series, if any, within a class, is:




                                                                  PAR VALUE PER SHARE OR STATEMENT
     CLASS          SERIES (IF ANY)         NUMBER OF SHARES      THAT SHARES ARE WITHOUT PAR VALUE
     -----          ---------------         ----------------      ---------------------------------
                                                         
    Common               None                   1,250                      No par value




                  Article 5.    The preferences, limitations, designation, and
relative rights of each class or series of stock, are none.

                  Article 6.    The address of initial registered office is Room
10 and 11, Goetz Theatre Building, Monroe, Wisconsin.

                  Article 7.    Name of initial registered agent at such address
is Joseph D. Viney.

                  Article 8.    The number of directors, constituting the
initial board of directors shall be five. Thereafter the number shall be fixed
by by-law but shall not be less than three.

                  Article 9.    The name and address of incorporator is:


                  NAME                            ADDRESS


         Doctor Peter P. Griffo           614 West Stephenson, Greenport, IL


                  Article 10.   (Other provisions) none.

                  Article 11.   These articles may be amended in the manner
authorized by law at the time of amendment.

EX-3.38

                                                                    EXHIBIT 3.38

                                     BY-LAWS
                                       OF
                       EXTENDICARE HEALTH FACILITIES, INC.

                                    ARTICLE I
                                     OFFICES

                  Section 1. REGISTERED OFFICE. The registered office shall be
established and maintained at the office of United States Corporation Company,
in the City of Madison, in the State of Wisconsin and said corporation shall be
the registered agent of this corporation in charge thereof.

                  Section 2. OTHER OFFICES. The corporation may have other
offices, either within or without the State of Wisconsin, at such place or
places as the Board of Directors may from time to time appoint or the business
of the corporation may require.

                                   ARTICLE II
                            MEETINGS OF STOCKHOLDERS

                  Section 1. ANNUAL MEETINGS. Annual meetings of stockholders
for the election of directors and for such other business as may properly come
before the meeting shall be held at such place, either within or without the
State of Wisconsin, as the Board of Directors shall determine and as set forth
in the notice of the meeting.

                  Annual meetings of stockholders shall be held during the
fourth week of March in each year at a time and date to be determined by the
Board of Directors. At each annual meeting, the stockholders shall elect a Board
of Directors and they may transact such other business as may properly come
before the meeting.

                  Section 2. OTHER MEETINGS. Meetings of stockholders for any
purpose or purposes may be called by the President, the Secretary, the Board of
Directors or such other persons as may be authorized by law, and shall be held
at such time and place, within or without the State of Wisconsin, as shall be
stated in the notice of meeting.

                  Section 3. VOTING. Each stockholder entitled to vote in
accordance with the terms of the Articles of Incorporation and in accordance
with the provisions of these By-Laws shall be entitled to one vote, in person or
by proxy, executed in writing by the stockholder or by its duly authorized
attorney in fact, for each share of stock entitled to vote held by such
stockholder. All elections for directors shall be decided by plurality vote; all
other questions shall be decided by majority vote except as otherwise provided
by the Articles of Incorporation or the laws of the State of Wisconsin.

                  Section 4. QUORUM. Except as otherwise required by Law, by the
Articles of Incorporation or by these By-Laws, the presence, in person or by
proxy, of stockholders holding a majority of the stock of the corporation
entitled to vote shall constitute a quorum at all meetings of the stockholders.
In case a quorum shall not be present at any meeting, a majority in interest of
the stockholders entitled to vote thereat, present in person or by proxy, shall
have power to adjourn the meeting from time to time, without notice other than
announcement at the




meeting until the requisite amount of stock entitled to vote shall be present;
provided, that if the adjournment is for more than thirty days or if after the
adjournment a new record date is fixed for the adjourned meeting, a notice of
the adjourned meeting will be sent to each stockholder of record entitled to
vote at the meeting, as adjourned. At any such adjourned meeting at which the
requisite amount of stock entitled to vote shall be represented, any business
may be transacted which might have been transacted at the meeting as originally
noticed; but only those stockholders entitled to vote at the meeting as
originally noticed shall be entitled to vote at any adjournment or adjournments
thereof, unless a new record date therefor shall have been fixed.

                  Section 5. NOTICE OF MEETINGS. Written notice, stating the
place, date and time of the meeting, and, in the case of a special meeting, the
purpose or purposes for which such meeting has been called, shall be given to
each stockholder entitled to vote thereat at his address as it appears on the
records of the corporation, not less than ten nor more than fifty days before
the date of the meeting.

                  Section 6. ACTION WITHOUT MEETING. Any action required to be
taken at any annual or special meeting of stockholders, or any action which may
be taken at any annual or special meeting, may be taken without a meeting,
without prior notice and without a vote, if a consent in writing, setting forth
the action so taken, shall be signed by the holders of all of the outstanding
stock of the corporation.

                                   ARTICLE III
                                    DIRECTORS

                  Section 1. NUMBER AND TERM. The number of authorized Directors
of the Corporation shall be not less than 1 nor more than 15, fixed from time to
time by the Shareholder. The Directors shall be elected at the annual meeting of
the Shareholders and each Director shall be elected to serve until his successor
shall be elected and shall qualify.

                  Section 2. RESIGNATIONS. Any director, member of a committee
or other officer may resign at any time. Such resignation shall be made in
writing, and shall take effect at the time specified therein, and if no time be
specified, at the time of its receipt by the President or Secretary. The
acceptance of a resignation shall not be necessary to make it effective.

                  Section 3. POWERS. The Board of Directors shall exercise all
of the powers of the corporation except such as are by law, or by the Articles
of Incorporation of the corporation or by these By-Laws conferred upon or
reserved to the stockholders.

                  Section 4. MEETINGS. The newly elected directors may hold
their first meeting for the purpose of the transaction of business, if a quorum
be present, immediately after the annual meeting of the stockholders; or the
time and place of such meeting may be fixed by consent in writing of all the
directors.

                  Regular meetings of the directors may be held without notice
at such places and times as shall be determined from time to time by resolution
of the directors.

                  Special meetings of the board may be called by or at the
request of the President, the Secretary or any two directors. Such meeting shall
be held at such place or places as shall be

                                       2



stated in the call of the meeting. Notice of any special meeting shall be given
at least six (6) hours previously thereto in any one of the following methods:
by oral or telephonic notice, by written notice delivered personally or mailed
to each director at his business address, or by telegram; provided, that if
notice is given by mail only, it shall be given at least forty-eight (48) hours
prior to such meeting. If mailed, such notice shall be deemed to be delivered
when deposited in the United States mail so addressed, with postage thereon
prepaid. If notice is given by telegram, such notice shall be deemed delivered
when the telegram is delivered to the telegraph company. Whenever any notice
whatever is required to be given to any director of the corporation under the
Certificate of Incorporation or these By-laws or any provision of law, a waiver
thereof in writing, signed at any time, whether before or after the time of the
meeting, by the director entitled to such notice, shall be deemed equivalent to
the giving of such notice.

                  Members of the Board of Directors, or any committee designated
by the Board of Directors, may participate in a meeting of the Board of
Directors, or any committee, by means of conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other, and such participation in a meeting shall
constitute presence in person at the meeting.

                  Section 5. COMMITTEES. The Board of Directors may, by
resolution or resolutions passed by a majority of the whole board, designate one
or more committees, each committee to consist of three or more directors of the
corporation. The board may designate one or more directors as alternate members
of any committee, who may replace any absent or disqualified member at any
meeting of the committee. In the absence or disqualification of any member of
such committee or committees, the member or members thereof present at any
meeting and not disqualified from voting, whether or not he or they constitute a
quorum, may unanimously appoint another member of the Board of Directors to act
at the meeting in the place of any such absent or disqualified member.

                  Any such committee, to the extent provided in the resolution
of the Board of Directors, or in these By-Laws, shall have and may exercise all
the powers and authority of the Board of Directors in the management of the
business and affairs of the corporation, and may authorize the seal of the
corporation to be affixed to all papers which may require it; but no such
committee shall have the power or authority in reference to amending the
Articles of Incorporation, adopting an agreement of merger or consolidation,
recommending to the stockholders the sale, lease or exchange of all or
substantially all of the corporation's property and assets, recommending to the
stockholders a dissolution of the corporation or a revocation of a dissolution,
or amending the By-Laws of the corporation and, unless the resolution, these
By-Laws, or the Certificate of Incorporation expressly so provide, no such
committee shall have the power or authority to declare a dividend or to
authorize the issuance of stock.

                  Section 6. QUORUM. A majority of the directors shall
constitute a quorum for the transaction of business. If at any meeting of the
board there shall be less than a quorum present, a majority of those present may
adjourn the meeting from time to time until a quorum is obtained, and no further
notice thereof need be given other than by announcement at the meeting which
shall be so adjourned.


                                       3



                                   ARTICLE IV
                                    OFFICERS

                  Section 1. OFFICERS. The officers of the corporation shall be
a President, a Treasurer, and a Secretary, all of whom shall be elected by the
Board of Directors and who shall hold office until their successors are elected
and qualified or until their earlier termination, death, resignation or removal.
In addition, the Board of Directors may elect a Chairman, one or more
Vice-Presidents and such Assistant Secretaries and Assistant Treasurers as they
may deem proper. None of the officers of the corporation need be directors. The
officers shall be elected at the first meeting of the Board of Directors after
each annual meeting. More than two offices may be held by the same person,
except for the offices of President and Vice-President and the offices of
President and Secretary.

                  Section 2. OTHER OFFICERS AND AGENTS. The Board of Directors
may appoint such other officers and agents as it may deem advisable, who shall
hold their offices for such terms and shall exercise such powers and perform
such duties as shall be determined from time to time by the Board of Directors.

                  Section 3. CHAIRMAN. The Chairman of the Board of Directors,
if one be elected, shall preside at all meetings of the Board of Directors and
he shall have and perform such other duties as from time to time may be assigned
to him by the Board of Directors.

                  Section 4. PRESIDENT. The President shall have the general
powers and duties of supervision and management usually vested in the office of
President of a corporation. He shall preside at all meetings of the stockholders
if present thereat, and in the absence or non-election of the Chairman of the
Board of Directors, at all meetings of the Board of Directors, and shall have
general supervision, direction and control of the business of the corporation.
Except as the Board of Directors shall authorize the execution thereof in some
other manner, he shall execute bonds, mortgages and other contracts in behalf of
the corporation, and shall cause the seal to be affixed to any instrument
requiring it and when so affixed the seal shall be attested by the signature of
the Secretary or the Treasurer or an Assistant Secretary or an Assistant
Treasurer.

                  Section 5. VICE-PRESIDENT. Each Vice-President shall have such
powers and shall perform such duties as shall be assigned to him by the Board of
Directors, or if no such powers and duties shall be assigned by the Board of
Directors, then such powers and duties as shall be assigned to him by the
Chairman of the Board of Directors or the President.

                  Section 6. TREASURER. The Treasurer shall have the custody of
the corporate funds and securities and shall keep full and accurate account of
receipts and disbursements in books belonging to the corporation. He shall
deposit all moneys and other valuables in the name and to the credit of the
corporation in such depositaries as may be designated by the Board of Directors.

                  The Treasurer shall disburse the funds of the corporation as
may be ordered by the Board of Directors, or the President, taking proper
vouchers for such disbursements. He shall render to the President and Board of
Directors at the regular meetings of the Board of Directors,


                                       4



or whenever they may request it, an account of all his transactions as Treasurer
and of the financial condition of the corporation. If required by the Board of
Directors, he shall give the corporation a bond for the faithful discharge of
his duties in such amount and with such surety as the Board of Directors shall
prescribe.

                  Section 7. SECRETARY. The Secretary shall give, or cause to be
given, notice of all meetings of stockholders and directors, and all other
notices required by law or by these By-Laws, and in case of his absence or
refusal or neglect so to do, any such notice may be given by any person
thereunto directed by the President, or by the Board of Directors, or
stockholders, upon whose requisition the meeting is called as provided in these
By-Laws. He shall record all the proceedings of the meetings of the corporation
and of the directors in a book to be kept for that purpose, and shall perform
such other duties as may be assigned, to him by the directors or the President.
He shall have the custody of the seal of the corporation and shall affix the
same to all instruments requiring it, when authorized by the Board of Directors
or the President, and attest the same.

                  Section 8. ASSISTANT TREASURERS AND ASSISTANT SECRETARIES.
Assistant Treasurers and Assistant Secretaries, if any, shall be elected and
shall have such powers and shall perform such duties as shall be assigned to
them, respectively, by the directors.

                                    ARTICLE V
                                  MISCELLANEOUS

                  Section 1. CERTIFICATES OF STOCK. Certificates of stock,
signed by the President or Vice-President and Secretary or any Assistant
Secretary, shall be issued to each stockholder certifying the number of shares
owned by such stockholder in the corporation. Any or all of the signatures may
be facsimiles.

                  Section 2. TRANSFER OF SHARES. The shares of stock of the
corporation shall be transferable only upon its books by the holders thereof in
person or by their duly authorized attorneys or legal representatives, and upon
such transfer the old certificates shall be surrendered to the corporation by
the delivery thereof to the person in charge of the stock and transfer books and
ledgers, or to such other person as the directors may designate, by whom they
shall be cancelled, and new certificates shall thereupon be issued. A record
shall be made of each transfer and whenever a transfer shall be made for
collateral security, and not absolutely, it shall be so expressed in the entry
of the transfer.

                  Section 3. STOCKHOLDERS RECORD DATE. In order that the
corporation may determine the stockholders entitled to notice of or to vote at
any meeting of stockholders or any adjournment thereof, or to express consent to
corporate action in writing without a meeting, or entitled to receive payment of
any dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any change, conversion or exchange of stock or
for the purpose of any other lawful action, the Board of Directors may fix, in
advance, a record date, which shall not be more than fifty nor less than ten
days before the date of such meeting, nor more than fifty days prior to any
other action. A determination of stockholders of record entitled to notice of or
to vote at a meeting of stockholders shall apply to


                                       5



any adjournment of the meeting; provided, however, that the Board of Directors
may fix a new record date for the adjourned meeting.

                  Section 4. SEAL. The corporate seal shall be circular in form
and shall contain the name of the corporation, its state of incorporation and
the words "CORPORATE SEAL." Said seal may be used by causing it or a facsimile
thereof to be impressed or affixed or reproduced or otherwise.

                  Section 5. FISCAL YEAR. The fiscal year of the corporation,
beginning with the year 1983, shall be the calendar year.

                  Section 6. CHECKS. All checks, drafts or other orders for the
payment of money, notes or other evidences of indebtedness issued in the name of
the corporation shall be signed by such officer or officers, agent or agents of
the corporation, and in such manner as shall be determined from time to time by
resolution of the board of directors.

                  Section 7. INDEMNIFICATION. The corporation may indemnify its
officers, directors, employees and agents to the full extent permitted by law.

                  Section 8. NOTICE AND WAIVER OF NOTICE. Whenever, under the
provisions of law, the Articles of Incorporation or these By-Laws, notice is
required to be given to any person, it shall not be construed to mean personal
notice, but such notice may be given in writing, by mail, addressed to such
person at his address as it appears on the records of the corporation, with
postage thereon prepaid, and such notice shall be deemed to be given at the time
when the same shall be deposited in the United States mail. Notice to directors
may also be given by any of the methods specified in Article III, Section 8 of
these By-Laws.

                  Whenever any notice whatever is required to be given under the
provisions of any law, the Articles of Incorporation or these By-Laws, a waiver
thereof in writing, signed by the person or persons entitled to said notice,
whether before or after the time stated therein, shall be deemed equivalent
thereto. Any waiver of notice to stockholders shall set forth in reasonable
detail the purpose or purposes for which the meeting is called and the time and
place thereof. Attendance by a director or stockholder at any meeting of
directors or stockholders, respectively, shall constitute a waiver of notice of
such meeting, except where such director or stockholder attends a meeting for
the express purpose of objecting, at the beginning of such meeting, to the
transaction of business because the meeting is not lawfully called or convened.

                                   ARTICLE VI
                                   AMENDMENTS

                  These By-Laws may be altered or repealed and By-Laws may be
made at any annual meeting of the stockholders or at any special meeting thereof
if notice of the proposed alteration or repeal or By-Law or By-Laws to be made
be contained in the notice of such special meeting, by the affirmative vote of a
majority of the stock issued and outstanding and entitled to vote thereat, or by
the affirmative vote of a majority of the Board of Directors, at any regular or
special meeting of the Board of Directors.


                                       6

EX-3.39

                                                                    EXHIBIT 3.39

                          CERTIFICATE OF INCORPORATION
                                       OF
                   EXTENDICARE HEALTH FACILITY HOLDINGS, INC.



         1.     The name of the corporation is

                   EXTENDICARE HEALTH FACILITY HOLDINGS, INC.

         2.     The address of its registered office in the State of Delaware is
306 South State Street, in the City of Dover, County of Kent. The name of its
registered agent at such address is the United States Corporation Company.

         3.     The nature of the business or purpose to be conducted or
promoted is:

         To engage in any lawful act or activity for which corporations may be
organized under the General Corporation Law of Delaware.

         4.     The total number of shares of stock which the corporation shall
have authority to issue is one thousand (1,000) and the par value of each of
such shares is One Dollar ($1.00) amounting in the aggregate to One Thousand
Dollars ($1,000.00).

         5.     The name and mailing address of the incorporator is as follows:

                NAME                               MAILING ADDRESS
                ----                               ---------------

                Dennis Howarth                     33 North LaSalle Street
                                                   Chicago, Illinois 60602

         6.     The corporation is to have perpetual existence.

         7.     In furtherance and not in limitation of the powers conferred by
statute, the board of directors is expressly authorized to make, alter or repeal
the by-laws of the corporation.

         8. The number of directors shall be as such as from time to time may be
fixed by, or in the manner provided in, the by-laws. Elections of directors need
not be by written ballot unless the by-laws of the corporation shall so provide.






         9.     The corporation reserves the right to amend, alter, change or
repeal any provision contained in this certificate of incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.












                                       2

EX-3.40

                                                                    EXHIBIT 3.40


                                     BY-LAWS
                                       OF
                   EXTENDICARE HEALTH FACILITY HOLDINGS, INC.

                                    ARTICLE I
                                     OFFICES

                  Section 1. REGISTERED OFFICE. The registered office shall be
established and maintained at the office of United States Corporation Company,
in the City of Dover, in the State of Delaware, and said corporation shall be
the registered agent of this corporation in charge thereof.

                  Section 2. OTHER OFFICES. The corporation may have other
offices, either within or without the State of Delaware, at such place or places
as the Board of Directors may from time to time appoint or the business of the
corporation may require.

                                   ARTICLE II
                            MEETINGS OF STOCKHOLDERS

                  Section 1. ANNUAL MEETINGS. Annual meetings of stockholders
for the election of directors and for such other business as may properly come
before the meeting shall be held at such place, either within or without the
State of Delaware, as the Board of Directors shall determine and as set forth in
the notice of the meeting.

                  Annual meetings of stockholders shall be held during the
fourth week of March in each year at a time and date to be determined by the
Board of Directors. At each annual meeting, the stockholders shall elect a Board
of Directors and they may transact such other business as may properly come
before the meeting.

                  Section 2. OTHER MEETINGS. Meetings of stockholders for any
purpose or purposes may be called by the President, the Secretary, the Board of
Directors or such other persons as may be authorized by law, and shall be held
at such time and place, within or without the State of Delaware, as shall be
stated in the notice of meeting.

                  Section 3. VOTING. Each stockholder entitled to vote in
accordance with the terms of the Certificate of Incorporation and in accordance
with the provisions of these By-Laws shall be entitled to one vote, in person or
by proxy, executed in writing by the stockholder or by its duly authorized
attorney in fact, for each share of stock entitled to vote held by such
stockholder. All elections for directors shall be decided by plurality vote; all
other questions shall be decided by majority vote except as otherwise provided
by the Certificate of Incorporation or the laws of the State of Delaware.

                  Section 4. QUORUM. Except as otherwise required by Law, by the
Certificate of Incorporation or by these By-Laws, the presence, in person or by
proxy, of stockholders holding a majority of the stock of the corporation
entitled to vote shall constitute a quorum at all meetings of the stockholders.
In case a quorum shall not be present at any meeting, a majority in interest of
the stockholders entitled to vote thereat, present in person or by proxy, shall
have power to adjourn the meeting from time to time, without notice other than







announcement at the meeting until the requisite amount of stock entitled to vote
shall be present; provided, that if the adjournment is for more than thirty days
or if after the adjournment a new record date is fixed for the adjourned
meeting, a notice of the adjourned meeting will be sent to each stockholder of
record entitled to vote at the meeting, as adjourned. At any such adjourned
meeting at which the requisite amount of stock entitled to vote shall be
represented, any business may be transacted which might have been transacted at
the meeting as originally noticed; but only those stockholders entitled to vote
at the meeting as originally noticed shall be entitled to vote at any
adjournment or adjournments thereof, unless a new record date therefor shall
have been fixed.

                  Section 5. NOTICE OF MEETINGS. Written notice, stating the
place, date and time of the meeting, and, in the case of a special meeting, the
purpose or purposes for which such meeting has been called, shall be given to
each stockholder entitled to vote thereat at his address as it appears on the
records of the corporation, not less than ten nor more than fifty days before
the date of the meeting.

                  Section 6. ACTION WITHOUT MEETING. Any action required to be
taken at any annual or special meeting of stockholders, or any action which may
be taken at any annual or special meeting, may be taken without a meeting,
without prior notice and without a vote, if a consent in writing, setting forth
the action so taken, shall be signed by the holders of a majority of the
outstanding stock of the corporation.

                                   ARTICLE III
                                    DIRECTORS

                  Section 1. NUMBER AND TERM. The number of authorized Directors
of the Corporation shall be not less than 1 nor more than 15, fixed from time to
time by the Shareholder. The Directors shall be elected at the annual meeting of
the Shareholders and each Director shall be elected to serve until his successor
shall be elected and shall qualify.

                  Section 2. RESIGNATIONS. Any director, member of a committee
or other officer may resign at any time. Such resignation shall be made in
writing, and shall take effect at the time specified therein, and if no time be
specified, at the time of its receipt by the President or Secretary. The
acceptance of a resignation shall not be necessary to make it effective.

                  Section 3. POWERS. The Board of Directors shall exercise all
of the powers of the corporation except such as are by law, or by the
Certificate of Incorporation of the corporation or by these By-Laws conferred
upon or reserved to the stockholders.

                  Section 4. MEETINGS. The newly elected directors may hold
their first meeting for the purpose of the transaction of business, if a quorum
be present, immediately after the annual meeting of the stockholders; or the
time and place of such meeting may be fixed by consent in writing of all the
directors.

                  Regular meetings of the directors may be held without notice
at such places and times as shall be determined from time to time by resolution
of the directors.


                                       2







                  Special meetings of the board may be called by or at the
request of the President, the Secretary or any two directors. Such meeting shall
be held at such place or places as shall be stated in the call of the meeting.
Notice of any special meeting shall be given at least six (6) hours previously
thereto in any one of the following methods: by oral or telephonic notice, by
written notice delivered personally or mailed to each director at his business
address, or by telegram; provided, that if notice is given by mail only, it
shall be given at least forty-eight (48) hours prior to such meeting. If mailed,
such notice shall be deemed to be delivered when deposited in the United States
mail so addressed, with postage thereon prepaid. If notice is given by telegram,
such notice shall be deemed delivered when the telegram is delivered to the
telegraph company. Whenever any notice whatever is required to be given to any
director of the corporation under the Certificate of Incorporation or these
By-laws or any provision of law, a waiver thereof in writing, signed at any
time, whether before or after the time of the meeting, by the director entitled
to such notice, shall be deemed equivalent to the giving of such notice.

                  Members of the Board of Directors, or any committee designated
by the Board of Directors, may participate in a meeting of the Board of
Directors, or any committee, by means of conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other, and such participation in a meeting shall
constitute presence in person at the meeting.

                  Section 5. COMMITTEES. The Board of Directors may, by
resolution or resolutions passed by a majority of the whole board, designate one
or more committees, each committee to consist of one or more directors of the
corporation. The board may designate one or more directors as alternate members
of any committee, who may replace any absent or disqualified member at any
meeting of the committee. In the absence or disqualification of any member of
such committee or committees, the member or members thereof present at any
meeting and not disqualified from voting, whether or not he or they constitute a
quorum, may unanimously appoint another member of the Board of Directors to act
at the meeting in the place of any such absent or disqualified member.

                  Any such committee, to the extent provided in the resolution
of the Board of Directors, or in these By-Laws, shall have and may exercise all
the powers and authority of the Board of Directors in the management of the
business and affairs of the corporation, and may authorize the seal of the
corporation to be affixed to all papers which may require it; but no such
committee shall have the power or authority in reference to amending the
Certificate of Incorporation, adopting an agreement of merger or consolidation,
recommending to the stockholders the sale, lease or exchange of all or
substantially all of the corporation's property and assets, recommending to the
stockholders a dissolution of the corporation or a revocation of a dissolution,
or amending the By-Laws of the corporation and, unless the resolution, these
By-Laws, or the Certificate of Incorporation expressly so provide, no such
committee shall have the power or authority to declare a dividend or to
authorize the issuance of stock.

                  Section 6. QUORUM. A majority of the directors shall
constitute a quorum for the transaction of business. If at any meeting of the
board there shall be less than a quorum present, a majority of those present may
adjourn the meeting from time to time until a quorum is obtained, and no further
notice thereof need be given other than by announcement at the meeting which
shall be so adjourned.



                                       3







                                   ARTICLE IV
                                    OFFICERS

                  Section 1. OFFICERS. The officers of the corporation shall be
a President, a Treasurer, and a Secretary, all of whom shall be elected by the
Board of Directors and who shall hold office until their successors are elected
and qualified or until their earlier termination, death, resignation or removal.
In addition, the Board of Directors may elect a Chairman, one or more
Vice-Presidents and such Assistant Secretaries and Assistant Treasurers as they
may deem proper. None of the officers of the corporation need be directors. The
officers shall be elected at the first meeting of the Board of Directors after
each annual meeting. More than two offices may be held by the same person.

                  Section 2. OTHER OFFICERS AND AGENTS. The Board of Directors
may appoint such other officers and agents as it may deem advisable, who shall
hold their offices for such terms and shall exercise such powers and perform
such duties as shall be determined from time to time by the Board of Directors.

                  Section 3. CHAIRMAN. The Chairman of the Board of Directors,
if one be elected, shall preside at all meetings of the Board of Directors and
he shall have and perform such other duties as from time to time may be assigned
to him by the Board of Directors.

                  Section 4. PRESIDENT. The President shall have the general
powers and duties of supervision and management usually vested in the office of
President of a corporation. He shall preside at all meetings of the stockholders
if present thereat, and in the absence or non-election of the Chairman of the
Board of Directors, at all meetings of the Board of Directors, and shall have
general supervision, direction and control of the business of the corporation.
Except as the Board of Directors shall authorize the execution thereof in some
other manner, he shall execute bonds, mortgages and other contracts in behalf of
the corporation, and shall cause the seal to be affixed to any instrument
requiring it and when so affixed the seal shall be attested by the signature of
the Secretary or the Treasurer or an Assistant Secretary or an Assistant
Treasurer.

                  Section 5. VICE-PRESIDENT. Each Vice-President shall have such
powers and shall perform such duties as shall be assigned to him by the Board of
Directors, or if no such powers and duties shall be assigned by the Board of
Directors, then such powers and duties as shall be assigned to him by the
Chairman of the Board of Directors or the President.

                  Section 6. TREASURER. The Treasurer shall have the custody of
the corporate funds and securities and shall keep full and accurate account of
receipts and disbursements in books belonging to the corporation. He shall
deposit all moneys and other valuables in the name and to the credit of the
corporation in such depositaries as may be designated by the Board of Directors.

                  The Treasurer shall disburse the funds of the corporation as
may be ordered by the Board of Directors, or the President, taking proper
vouchers for such disbursements. He shall render to the President and Board of
Directors at the regular meetings of the Board of Directors, or whenever they
may request it, an account of all his transactions as Treasurer and of the


                                       4







financial condition of the corporation. If required by the Board of Directors,
he shall give the corporation a bond for the faithful discharge of his duties in
such amount and with such surety as the Board of Directors shall prescribe.

                  Section 7. SECRETARY. The Secretary shall give, or cause to be
given, notice of all meetings of stockholders and directors, and all other
notices required by law or by these By-Laws, and in case of his absence or
refusal or neglect so to do, any such notice may be given by any person
thereunto directed by the President, or by the Board of Directors, or
stockholders, upon whose requisition the meeting is called as provided in these
By-Laws. He shall record all the proceedings of the meetings of the corporation
and of the directors in a book to be kept for that purpose, and shall perform
such other duties as may be assigned to him by the Board of Directors or the
President. He shall have the custody of the seal of the corporation and shall
affix the same to all instruments requiring it, when authorized by the Board of
Directors or the President, and attest the same.

                  Section 8. ASSISTANT TREASURERS AND ASSISTANT SECRETARIES.
Assistant Treasurers and Assistant Secretaries, if any, shall be elected and
shall have such powers and shall perform such duties as shall be assigned to
them, respectively, by the Board of Directors.

                                    ARTICLE V
                                  MISCELLANEOUS

                  Section 1. CERTIFICATES OF STOCK. Certificates of stock,
signed by the President or Vice-President and Secretary or
any Assistant Secretary, shall be issued to each stockholder certifying the
number of shares owned by such stockholder in the corporation. Any or all of the
signatures may be facsimiles.

                  Section 2. TRANSFER OF SHARES. The shares of stock of the
corporation shall be transferable only upon its books by the holders thereof in
person or by their duly authorized attorneys or legal representatives, and upon
such transfer the old certificates shall be surrendered to the corporation by
the delivery thereof to the person in charge of the stock and transfer books and
ledgers, or to such other person as the directors may designate, by whom they
shall be cancelled, and new certificates shall thereupon be issued. A record
shall be made of each transfer and whenever a transfer shall be made for
collateral security, and not absolutely, it shall be so expressed in the entry
of the transfer.

                  Section 3. STOCKHOLDERS RECORD DATE. In order that the
corporation may determine the stockholders entitled to notice of or to vote at
any meeting of stockholders or any adjournment thereof, or to express consent to
corporate action in writing without a meeting, or entitled to receive payment of
any dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any change, conversion or exchange of stock or
for the purpose of any other lawful action, the Board of Directors may fix, in
advance, a record date, which shall not be more than fifty nor less than ten
days before the date of such meeting, nor more than fifty days prior to any
other action. A determination of stockholders of record entitled to notice of or
to vote at a meeting of stockholders shall apply to


                                       5







any adjournment of the meeting; provided, however, that the Board of Directors
may fix a new record date for the adjourned meeting.

                  Section 4. SEAL. The corporate seal shall be circular in form
and shall contain the name of the corporation, its state of incorporation
and the words "CORPORATE SEAL." Said seal may be used by causing it or a
facsimile thereof to be impressed or affixed or reproduced or otherwise.

                  Section 5. FISCAL YEAR. The fiscal year of the corporation,
beginning with the year 1983, shall be the calendar year.

                  Section 6. CHECKS. All checks, drafts or other orders for the
payment of money, notes or other evidences of indebtedness issued in the name of
the corporation shall be signed by such officer or officers, agent or agents of
the corporation, and in such manner as shall be determined from time to time by
resolution of the board of directors.

                  Section 7. INDEMNIFICATION. The corporation may indemnify its
officers, directors, employees and agents to the full extent
permitted by law.

                  Section 8. NOTICE AND WAIVER OF NOTICE. Whenever, under the
provisions of law, the Certificate of Incorporation or these By-Laws, notice is
required to be given to any person, it shall not be construed to mean personal
notice, but such notice may be given in writing, by mail, addressed to such
person at his address as it appears on the records of the corporation, with
postage thereon prepaid, and such notice shall be deemed to be given at the time
when the same shall be deposited in the United States mail. Notice to directors
may also be given by any of the methods specified in Article III, Section 8 of
these By-Laws.

                  Whenever any notice whatever is required to be given under the
provisions of any law, the Certificate of Incorporation or these By-Laws, a
waiver thereof in writing, signed by the person or persons entitled to said
notice, whether before or after the time stated therein, shall be deemed
equivalent thereto. Any waiver of notice to stockholders shall set forth in
reasonable detail the purpose or purposes for which the meeting is called and
the time and place thereof. Attendance by a director or stockholder at any
meeting of directors or stockholders, respectively, shall constitute a waiver of
notice of such meeting, except where such director or stockholder attends a
meeting for the express purpose of objecting, at the beginning of such meeting,
to the transaction of business because the meeting is not lawfully called or
convened.

                                   ARTICLE VI
                                   AMENDMENTS

                  These By-Laws may be altered or repealed and By-Laws may be
made at any annual meeting of the stockholders or at any special meeting thereof
if notice of the proposed alteration or repeal or By-Law or By-Laws to be made
be contained in the notice of such special meeting, by the affirmative vote of a
majority of the stock issued and outstanding and entitled to vote thereat, or by
the affirmative vote of a majority of the Board of Directors, at any regular or
special meeting of the Board of Directors.



                                       6

EX-3.41

                                                                    EXHIBIT 3.41

                          CERTIFICATE OF INCORPORATION
                                       OF
                        EXTENDICARE HEALTH NETWORK, INC.


                  FIRST: The name of the Corporation is Extendicare Health
Network, Inc.

                  SECOND: The address of the registered office in the State of
Delaware is No. 100 West Tenth Street, in the City of Wilmington, County of New
Castle. The name of its registered agent at such address is The Corporation
Trust Company.

                  THIRD: The nature of the business or purposes to be conducted
or promoted is to engage in any lawful act or activity for which corporations
may be organized under the General Corporation Law of Delaware and to possess
and exercise all the powers and privileges granted by the General Corporation
Law of Delaware.

                  FOURTH: The total number of shares of stock which the
corporation shall have authority to issue is Two Thousand (2,000); all of such
shares shall be without par value.

                  FIFTH: The name and mailing address of the incorporator is
Phillip M. Cohen, 1714 West Bruce Street, Milwaukee, Wisconsin 53204.

                  SIXTH: The corporation is to have perpetual existence.

                  SEVENTH: The corporation reserves the right to amend, alter,
change or repeal any provisions contained in this certificate of incorporation,
in the manner now or hereafter prescribed by statute, and all rights conferred
upon stockholders are granted subject to this reservation.

EX-3.42

                                                                    EXHIBIT 3.42



                                     BYLAWS
                                       OF
                        EXTENDICARE HEALTH NETWORK, INC.
                  (FKA UNITED PROFESSIONAL COMPANIES, INC. AND
                        UNION PRESCRIPTION CENTERS, INC.)
                             A DELAWARE CORPORATION

                                   ARTICLE I
                                    OFFICES

                  Section 1. The corporation shall maintain an office in the
State of Delaware c/o Corporation Trust Co., 100 W. 10th Street, City of
Wilmington, County of New Castle.

                  The principal office of the corporation in the State of
Wisconsin shall be located in the City of Milwaukee, County of Milwaukee. The
corporation may have such other offices, either within or without the State of
Wisconsin, as the Board of Directors may designate or as the business of the
corporation may require from time to time.

                                   ARTICLE II
                                  SHAREHOLDERS

                  Section 1. Annual Meeting. The annual meeting of the
shareholders shall be the fourth week of March per Shareholder Action dated
December 1, 1994, for the purpose of electing directors and for the transaction
of such other business as may come before the meeting. If the election of
directors shall not be held on the day designated herein for any annual meeting
of the shareholders, or at any adjournment thereof, the Board of Directors shall
cause the election to be held at a special meeting of the shareholders as soon
thereafter as may be convenient.

                  Section 2. Special Meetings. Special meetings of the
shareholders, for any purpose or purposes, unless otherwise prescribed by
statute, may be called by the President or the Board of Directors, and shall be
called by the President at the request of the holders of not less than one-tenth
of all the outstanding shares of the corporation entitled to vote at the
meeting.

                  Section 3. Place of Meeting. The Board of Directors may
designate any place, either within or without the State of Wisconsin, as the
place of meeting for any annual meeting or for any special meeting called by the
Board of Directors. A waiver of notice signed by all shareholders entitled to
vote at a meeting may designate any place, either within or without the State of
Wisconsin, as the place for the holding of such meeting. If no designation is
made, or if a special meeting be otherwise called, the place of meeting shall be
the registered office of the corporation in the State of Wisconsin, but any
meeting may be adjourned to reconvene at any place designated by vote of a
majority of the shares represented thereat.

                  Section 4. Notice of Meeting. Written notice stating the
place, day and hour of the meeting and, in case of a special meeting, the
purpose or purposes for which the meeting is called, shall be delivered not less
than ten days nor more than fifty days before the date of the meeting, either
personally or by mail, by or at the direction of the President, or the
Secretary, or the officer or persons calling the meeting, to each shareholder of
record entitled to vote at such meeting. If mailed, such notice shall be deemed
to be delivered when deposited in the United





States mail, addressed to the shareholder at his address as it appears on the
stock record books of the corporation, with postage thereon prepaid.

                  Section 5. Closing of Transfer Books or Fixing of Record Date.
For the purpose of determining shareholders entitled to notice of or to vote at
any meeting of shareholders or any adjournment thereof, or shareholders entitled
to receive payment of any dividend, or in order to make a determination of
shareholders for any other proper purpose, the Board of Directors of the
corporation may provide that the stock transfer books shall be closed for a
stated period but not to exceed, in any case, fifty days. If the stock transfer
books shall be closed for the purpose of determining shareholders entitled to
notice of or to vote at a meeting of shareholders, such books shall be closed
for at least ten days immediately preceding such meeting. In lieu of closing the
stock transfer books, the Board of Directors may fix in advance a date as the
record date for any such determination of shareholders, such date in any case to
be not more than fifty days and, in case of a meeting of shareholders, not less
than ten days prior to the date on which the particular action, requiring such
determination of shareholders entitled to notice of or to vote at a meeting of
shareholders, or shareholders entitled to receive payment of a dividend, the
close of business on the date on which notice of the meeting is mailed or on the
date on which the resolution of the Board of Directors declaring such dividend
is adopted, as the case may be, shall be the record date for such determination
of shareholders. When a determination of shareholders entitled to vote at any
meeting of shareholders has been made as provided in this section, such
determination shall be applied to any adjournment thereof except where the
determination has been made through the closing of the stock transfer books and
the stated period of closing has expired.

                  Section 6. Voting Lists. The officer or agent having charge of
the stock transfer books for shares of the corporation shall make, at least ten
days before each meeting of shareholders, a complete list of the shareholders
entitled to vote at such meeting, or any adjournment thereof, arranged in
alphabetical order, with the address of and the number of shares held by each,
which list, for a period of ten days prior to such meeting, shall be kept on
file at the registered office of the corporation and shall be subject to
inspection by any shareholder at any time during usual business hours. Such list
shall also be produced and kept open at the time and place of the meeting and
shall be subject to the inspection of any shareholder during the whole time of
the meeting. The original stock transfer books shall be prima facie evidence as
to who are shareholders entitled to examine such list or transfer books or to
vote at any meeting of shareholders. Failure to comply with the requirements of
this section shall not affect the validity of any action taken at such meeting.

                  Section 7. Quorum. Except as otherwise provided, a majority of
the outstanding shares of the corporation entitled to vote, represented in
person or by proxy, shall constitute a quorum at a meeting of shareholders and a
majority of votes cast at any meeting at which a quorum is present shall be
decisive of any motion or election. Though less than a quorum of the outstanding
shares are represented at a meeting, a majority of the shares so represented may
adjourn the meeting from time to time without further notice. At such adjourned
meeting at which a quorum shall be present or represented, any business may be
transacted which might have been transacted at the meeting as originally
notified.

                                       2



                  Section 8. Proxies. At all meetings of shareholders, a
shareholder entitled to vote may vote by proxy appointed in writing by the
shareholder or by his duly authorized attorney in fact. Such proxy shall be
filed with the Secretary of the corporation before or at the time of the
meeting. No proxy shall be valid after eleven months from the date of its
execution, unless otherwise provided in the proxy.

                  Section 9. Voting of Shares. Each outstanding share entitled
to vote shall be entitled to one vote upon each matter submitted to a vote at a
meeting of shareholders, except to the extent that the voting rights of the
shares of any class or classes are limited or denied by the articles of
incorporation.

                  Section 10. Voting of Shares by Certain Holders. Shares
standing in the name of another corporation may be voted by the president of
such corporation, or any other officer or proxy appointed by such president, in
the absence of express notice to this corporation, given in writing to the
Secretary, of the designation of some other person by the board of directors or
the by-laws of such other corporation.

                  Shares held by an administrator, executor, guardian,
conservator, trustee in bankruptcy, receiver, or assignee for creditors may be
voted by him, either in person or by proxy, without a transfer of such shares
into his name, provided that there is filed with the Secretary before or at the
tune of meeting proper evidence of his incumbency and the number of shares held.
Shares standing in the name of a fiduciary may be voted by him, either in person
or by proxy.

                  A shareholder whose shares are pledged shall be entitled to
vote such shares until the shares have been transferred into the name of the
pledgee, and thereafter the pledgee shall be entitled to vote the shares so
transferred.

                  Shares of its own stock belonging to the corporation shall not
be voted, directly or indirectly, at any meeting, and shall not be counted in
determining the total number of outstanding shares entitled to vote at any given
time, but shares of its own stock held by it in a fiduciary capacity may be
voted and shall be counted in determining the total number of outstanding shares
at any given time.

                  Section 11. Waiver of Notice by Shareholders. Whenever any
notice whatever is required to be given to any shareholder of the corporation
under the articles of incorporation or by-laws or any provision of law, a waiver
thereof in writing, signed at any time, whether before or after the time of
meeting, by the shareholder entitled to such notice, shall be deemed equivalent
to the giving of such notice; provided that such waiver in respect to any matter
of which notice is required under any provision of Chapter 180, Wisconsin
Statutes, shall contain the same information as would have been required to be
included in such notice, except the time and place of meeting.

                  Section 12. Informal Action by Shareholders. Any action
required or permitted by the articles of incorporation or by-laws or any
provision of law to be taken at a meeting of the shareholders, may be taken
without a meeting if a consent in writing, setting forth

                                       3


the action so taken, shall be signed by all of the shareholders entitled to vote
with respect to the subject matter thereof.

                                  ARTICLE III
                               BOARD OF DIRECTORS

                  Section 1. General Powers. The business and affairs of the
corporation shall be managed by its Board of Directors.


                  Section 2. Number, Tenure and Qualifications. The number of
authorized Directors of the Corporation shall be not less than 1 nor more than
15, fixed from time to time by the Shareholder. The Directors shall be elected
at the annual meeting of the Shareholders and each Director shall be elected to
serve until his successor shall be elected and shall qualify.

                  Section 3. Regular Meetings. A regular meeting of the Board of
Directors shall be held without other notice than this by-law immediately after,
and at the same place as, the annual meeting of shareholders, and each adjourned
session thereof. The Board of Directors may provide, by resolution, the time and
place, either within or without the State of Wisconsin, for the holding of
additional regular meetings without other notice than such resolution.

                  Section 4. Special Meetings. Special meetings of the Board of
Directors may be called by or at the request of the President, Secretary or any
two Directors. The person or persons authorized to call special meetings of the
Board of Directors may fix any place, either within or without the State of
Wisconsin, as the place for holding any special meeting of the Board of
Directors called by them.

                  Section 5. Notice. Notice of any special meeting shall be
given at least 48 hours previously thereto by written notice delivered
personally or mailed to each director at his business address, or by telegram.
If mailed, such notice shall be deemed to be delivered when deposited in the
United States mail so addressed, with postage thereon prepaid. If notice be
given by telegram, such notice shall be deemed to be delivered when the telegram
is delivered to the telegraph company. Whenever any notice whatever is required
to be given to any director of the corporation under the articles of
incorporation or by-laws or any provision of law, a waiver thereof in writing,
signed at any time, whether before or after the time of meeting, by the director
entitled to such notice, shall be deemed equivalent to the giving of such
notice. The attendance of a director at a meeting shall constitute a waiver of
notice of such meeting, except where a director attends a meeting and objects
thereat to the transaction of any business because the meeting is not lawfully
called or convened. Neither the business to be transacted at, nor the purpose
of, any regular or special meeting of the Board of Directors need be specified
in the notice or waiver of notice of such meeting.

                  Section 6. Quorum. Except as otherwise provided, a majority of
the number of directors fixed by Section 2 of this Article III shall constitute
a quorum for the transaction of business at any meeting of the Board of
Directors, but a majority of the directors present (though less than such
quorum) may adjourn the meeting from time to time without further notice.

                                       4


                  Section 7. Manner of Acting. The act of the majority of the
directors present at a meeting at which a quorum is present shall be the act of
the Board of Directors, unless the act of a greater number is required by law or
by the articles of incorporation or these by-laws.

                  Section 8. Vacancies. Any vacancy occurring in the board of
directors, including a vacancy created by an increase in the number of
directors, may be filled until the next succeeding annual election by the
affirmative vote of a majority of the directors then in office, though less than
a quorum of the board of directors.

                  Section 9. Compensation. The Board of Directors, by
affirmative vote of a majority of the directors then in office, and irrespective
of any personal interest of any of its members, may establish reasonable
compensation of all directors for services to the corporation as directors,
officers or otherwise, or may delegate such authority to an appropriate
committee. The board of directors also shall have authority to provide for or to
delegate authority to an appropriate committee to provide for reasonable
pensions, disability or death benefits, and other benefits or payments, to
directors, officers and employees and to their estates, families, dependents or
beneficiaries on account of prior services rendered by such directors, officers
and employees to the corporation.

                  Section 10. Presumption of Assent. A director of the
corporation who is present at a meeting of the Board of Directors or a committee
thereof at which action on any corporate matter is taken shall be presumed to
have assented to the action taken unless his dissent shall be entered in the
minutes of the meeting or unless he shall file his written dissent to such
action with the person acting as the secretary of the meeting before the
adjournment thereof or shall forward such dissent by registered mail to the
Secretary of the corporation immediately after the adjournment of the meeting.
Such right to dissent shall not apply to a director who voted in favor of such
action.

                  Section 11. Committees. The Board of Directors by resolution
adopted by the affirmative vote of a majority of the number of directors fixed
by Section 2 of this Article III may designate one or more committees, each
committee to consist of three or more directors elected by the Board of
Directors, which to the extent provided in said resolution as initially adopted,
and as thereafter supplemented or amended by further resolution adopted by a
like vote, shall have and may exercise, when the Board of Directors is not in
session, the powers of the Board of Directors in the management of the business
and affairs of the corporation, except action in respect to dividends to
shareholders, election of officers or the filling of vacancies in the Board of
Directors or committees created pursuant to this section. The Board of Directors
may elect one or more of its members as alternate members of any such committee
who may take the place of any absent member or members at any meeting of such
committee, upon request by the President or upon request by the chairman of such
meeting. Each such committee shall fix its own rules governing the conduct of
its activities and shall make such report to the Board of Directors of its
activities as the Board of Directors may request.

                  Section 12. Informal Action without Meeting. Any action
required or permitted by the articles of incorporation or by-laws or any
provision of law to be taken by the Board of Directors at a meeting or by
resolution may be taken without a meeting if a consent in writing, setting forth
the action so taken, shall be signed by all of the directors then in office.

                                       5


                                   ARTICLE IV
                                    OFFICERS

                  Section 1. Number. The principal officers of the corporation
shall be a President, 1 Vice-Presidents, a Secretary, and a Treasurer, each of
whom shall be elected by the Board of Directors. Such other officers and
assistant officers as may be deemed necessary may be elected or appointed by the
Board of Directors. Any two or more offices may be held by the same person,
except the offices of President and Secretary and the offices of President and
Vice-President.

                  Section 2. Election and Term of Office. The officers of the
corporation to be elected by the Board of Directors shall be elected annually by
the Board of Directors at the first meeting of the Board of Directors held after
each annual meeting of the shareholders. If the election of officers shall not
be held at such meeting, such election shall be held as soon thereafter as
conveniently may be. Each officer shall hold office until his successor shall
have been duly elected, or until his death or until he shall resign or shall
have been removed in the manner hereinafter provided.

                  Section 3. Removal. Any officer or agent elected or appointed
by the Board of Directors may be removed by the Board of Directors whenever in
its judgment the best interest of the corporation will be served thereby, but
such removal shall be without prejudice to the contract rights, if any, of the
person so removed. Election or appointment shall not of itself create contract
rights.

                  Section 4. Vacancies. A vacancy in any principal office
because of death, resignation, removal, disqualification or otherwise, shall be
filled by the Board of Directors for the unexpired portion of the term.

                  Section 5. President. The President shall be the principal
executive officer of the corporation and, subject to the control of the Board of
Directors, shall in general supervise and control all of the business and
affairs of the corporation. He shall, when present, preside at all meetings of
the shareholders and of the Board of Directors. He shall have authority, subject
to such rules as may be prescribed by the Board of Directors, to appoint such
agents and employees of the corporation as he shall deem necessary, to prescribe
their powers, duties and compensation, and to delegate authority to them. Such
agents and employees shall hold office at the discretion of the President. He
shall have authority to sign, execute and acknowledge, on behalf of the
corporation, all deeds, mortgages, bonds, stock certificates, contracts, leases,
reports and all other documents or instruments necessary or proper to be
executed in the course of the corporation's regular business, or which shall be
authorized by resolution of the Board of Directors; and, except as otherwise
provided by law or the Board of Directors, he may authorize any Vice-President
or other officer or agent of the corporation to sign, execute and acknowledge
such documents or instruments in his place and stead. In general he shall
perform all duties incident to the office of President and such other duties as
may be prescribed by the Board of Directors from time to time.

                  Section 6. The Vice-Presidents. In the absence of the
President or in the event of his death, inability or refusal to act, the
Vice-President (or in the event there be more

                                       6


than one Vice-President, the Vice-President in the order designated at the time
of their election, or in the absence of any designation, then in the order of
their election) shall perform the duties of the President, and when so acting,
shall have all the powers of and be subject to all the restrictions upon the
President. Any Vice-President may sign, with the Secretary or Assistant
Secretary, certificates for shares of the corporation; and shall perform such
other duties and have such authority as from time to time may be assigned to him
by the President or by the Board of Directors.

                  Section 7. The Secretary. The Secretary shall: (a) keep the
minutes of the shareholders' and of the Board of Directors' meetings in one or
more books provided for that purpose; (b) see that all notices are duly given in
accordance with the provisions of these by-laws or as required by law; (c) be
custodian of the corporate records and of the seal of the corporation and see
that the seal of the corporation is affixed to all documents the execution of
which on behalf of the corporation under its seal is duly authorized; (d) keep a
register of the post office address of each shareholder which shall be furnished
to the Secretary by such shareholder; (e) sign with the President or a
Vice-President, certificates for shares of the corporation, the issuance of
which shall have been authorized by resolution of the Board of Directors; (f)
have general charge of the stock transfer books of the corporation; and (g) in
general perform all duties incident to the office of Secretary and have such
other duties and exercise such authority as from time to time may be delegated
or assigned to him by the President or by the Board of Directors.

                  Section 8. The Treasurer. If required by the Board of
Directors, the Treasurer shall give a bond for the faithful discharge of his
duties in such sum and with such surety or sureties as the Board of Directors
shall determine. He shall: (a) have charge and custody of and be responsible for
all funds and securities of the corporation; receive and give receipts for
moneys due and payable to the corporation from any source whatsoever, and
deposit all such moneys in the name of the corporation in such banks, trust
companies or other depositaries as shall be selected in accordance with the
provisions of Article V of these By-Laws; and (b) in general perform all of the
duties incident to the office of Treasurer and have such other duties and
exercise such other authority as from time to time may be delegated or assigned
to him by the President or by the Board of Directors.

                  Section 9. Assistant Secretaries and Assistant Treasurers.
There shall be such number of Assistant Secretaries and Assistant Treasurers as
the Board of Directors may from time to time authorize. The Assistant
Secretaries may sign with the President or a Vice-President certificates for
shares of the corporation the issuance of which shall have been authorized by a
resolution of the Board of Directors. The Assistant Treasurers shall
respectively, if required by the Board of Directors, give bonds for the faithful
discharge of their duties in such sums and with such sureties as the Board of
Directors shall determine. The Assistant Secretaries and Assistant Treasurers,
in general, shall perform such duties and have such authority as shall from time
to time be delegated or assigned to them by the Secretary or the Treasurer,
respectively, or by the President or the Board of Directors.

                  Section 10. Other Assistants and Acting Officers. The Board of
Directors shall have the power to appoint any person to act as assistant to any
officer, or to perform the duties of such officer whenever for any reason it is
impracticable for such officer to act personally, and such assistant or acting
officer so appointed by the Board of Directors shall have the power to

                                        7


perform all the duties of the office to which he is so appointed to be
assistant, or as to which he is so appointed to act, except as such power may be
otherwise defined or restricted by the Board of Directors.

                  (a) Salaries. The salaries of the officers shall be fixed from
time to time by the Board of Directors and no officer shall be prevented from
receiving such salary by reason of the fact that he is also a director of the
corporation.

                  (b) Reimbursement of Disallowed Compensation to Officers. Any
payments made to an officer of the Corporation such as a salary, commission,
bonus, interest, or rent or entertainment expense incurred by him, which shall
be disallowed in whole or in part as a deductible expense by the Internal
Revenue Service, shall be reimbursed by such officer to the Corporation to the
full extent of such disallowance. It shall be the duty of the Directors, as a
Board, to enforce payment of each such amount disallowed. In lieu of payment by
the officer, subject to the determination of the Directors, proportionate
amounts may be withheld from his future compensation payments until the amount
owed to the corporation has been recovered.

                                   ARTICLE V
                      CONTRACTS, LOANS, CHECKS AND DEPOSITS

                  Section 1. Contracts. The Board of Directors may authorize any
officer or officers, agent or agents, to enter into any contract or execute and
deliver any instrument in the name of and on behalf of the corporation, and such
authorization may be general or confined to specific instances.

                  Section 2. Loans. No loans shall be contracted on behalf of
the corporation and no evidences of indebtedness shall be issued in its name
unless authorized by or under the authority of a resolution of the Board of
Directors. Such authorization may be general or confined to specific instances.

                  Section 3. Checks, Drafts, etc. All checks, drafts or other
orders for the payment of money, notes or other evidences of indebtedness issued
in the name of the corporation, shall be signed by such officer or officers,
agent or agents of the corporation and in such manner as shall from time to time
be determined by or under the authority of a resolution of the Board of
Directors.

                  Section 4. Deposits. All funds of the corporation not
otherwise employed shall be deposited from time to time to the credit of the
corporation in such banks, trust companies or other depositaries as may be
selected by or under authority of the Board of Directors.

                                   ARTICLE VI
                   CERTIFICATES FOR SHARES AND THEIR TRANSFER

                  Section 1. Certificates for Shares. Certificates representing
shares of the corporation shall be in such form as shall be determined by the
Board of Directors. Such certificates shall be signed by the President or a
Vice-President and by the Secretary or an Assistant Secretary. All certificates
for shares shall be consecutively numbered or otherwise


                                       8



identified. The name and address of the person to whom the shares represented
thereby are issued, with the number of shares and date of issue, shall be
entered on the stock transfer books of the corporation. All certificates
surrendered to the corporation for transfer shall be cancelled and no new
certificates shall be issued until the former certificate for a like number of
shares shall have been surrendered and cancelled, except that in case of a lost,
destroyed or mutilated certificate a new one may be issued therefor upon such
terms and indemnity to the corporation as the Board of Directors may prescribe.

                  Section 2. Transfer of Shares. Transfer of shares of the
corporation shall be made only on the stock transfer books of the corporation by
the holder of record thereof or by his legal representative, who shall furnish
proper evidence of authority to transfer, or by his attorney authorized by power
of attorney duly executed and filed with the Secretary of the corporation, and
on surrender for cancellation of the certificate for such shares. The person in
whose name shares stand on the books of the corporation shall be deemed by the
corporation to be the owner thereof for all purposes.

                  Section 3. Stock Regulations. The Board of Directors shall
have the power and authority to make all such further rules and regulations not
inconsistent with the statutes of the State of Wisconsin as they may deem
expedient concerning the issue, transfer and registration of certificates
representing shares of the corporation.

                                  ARTICLE VII
                                   FISCAL YEAR

                  The fiscal year of the corporation shall begin on the first
day of June and end on the thirty-first day of May in each year. Commencing with
the period ending December 31, 1986, the fiscal year of the corporation shall
end on the last day of December in each year.

                                  ARTICLE VIII
                                    DIVIDENDS

                  The Board of Directors may from time to time declare, and the
corporation may pay, dividends on its outstanding shares in the manner and upon
the terms and conditions provided by law and its articles of incorporation.

                                   ARTICLE IX
                                      SEAL

                  The Board of Directors shall provide a corporate seal which
shall be circular in form and shall have inscribed thereon the name of the
corporation and the State of Wisconsin and the words, "Corporate Seal."

                                   ARTICLE X
                                   AMENDMENTS

                  These By-Laws may be altered or repealed and By-Laws may be
made at any annual meeting of the stockholders or at any special meeting thereof
if notice of the proposed alteration or repeal or By-Law or By-Laws to be made
be contained in the notice of such special

                                       9


meeting, by the affirmative vote of a majority of the stock issued and
outstanding and entitled to vote thereat, or by the affirmative vote of a
majority of the Board of Directors, at any regular or special meeting of the
Board of Directors.


                                       10

EX-3.43

                                                                    EXHIBIT 3.43


                          CERTIFICATE OF INCORPORATION
                                       OF
                            EXTENDICARE HOMES, INC.


         1. The name of the Corporation shall be Extendicare Homes, Inc.

         2. The address of its registered office in the State of Delaware is 306
South State Street, in the City of Dover, County of Kent. The name of its
registered agent at such address is the United States Corporation Company.

         3. The nature of the business or purpose to be conducted or promoted
is:

         To engage in any lawful act or activity for which corporations may be
organized under the General Corporation Law of Delaware.

         4. The total number of shares of stock which the corporation shall have
authority to issue is one thousand (1,000) and the par value of each of such
shares is One Dollar ($1.00) amounting in the aggregate to One Thousand Dollars
($1,000.00).

         5. The name and mailing address of the incorporator is as follows:

                     NAME                              MAILING ADDRESS
                     ----                              ---------------

                Dennis Howarth                         33 North LaSalle Street
                                                       Chicago, Illinois 60602

         6. The corporation is to have perpetual existence.

         7. In furtherance and not in limitation of the powers conferred by
statute, the board of directors is expressly authorized to make, alter or repeal
the by-laws of the corporation.

         8. The number of directors shall be such as from time to time may be
fixed by, or in the manner provided in, the by-laws. Elections of directors need
not be by written ballot unless the by-laws of the corporation shall so provide.

         9. The corporation reserves the right to amend, alter, change or repeal
any provision contained in this certificate of incorporation, in the manner now
or hereafter prescribed by statute, and all rights conferred upon stockholders
herein are granted subject to this reservation.

EX-3.44

                                                                    EXHIBIT 3.44
                                    BY-LAWS
                                       OF
                            EXTENDICARE HOMES, INC.

                            (Effective July 1, 1997)

                                   ARTICLE I
                                    OFFICES

                  Section 1. REGISTERED OFFICE. The registered office shall be
established and maintained at the office of United States Corporation Company,
in the City of Dover, in the State of Delaware, and said corporation shall be
the registered agent of this corporation in charge thereof.

                  Section 2. OTHER OFFICES. The corporation may have other
offices, either within or without the State of Delaware, at such place or places
as the Board of Directors may from time to time appoint or the business of the
corporation may require.

                                   ARTICLE II
                            MEETINGS OF STOCKHOLDERS

                  Section 1. ANNUAL MEETINGS. Annual meetings of stockholders
for the election of directors and for such other business as may properly come
before the meeting shall be held at such place, either within or without the
State of Delaware, as the Board of Directors shall determine and as set forth in
the notice of the meeting.

                  Annual meetings of stockholders shall be held during the
fourth week of March in each year at a time and date to be determined by the
Board of Directors. At each annual meeting, the stockholders shall elect a Board
of Directors and they may transact such other business as may properly come
before the meeting.

                  Section 2. OTHER MEETINGS. Meetings of stockholders for any
purpose or purposes may be called by the President, the Secretary, the Board of
Directors or such other persons as may be authorized by law, and shall be held
at such time and place, within or without the State of Delaware, as shall be
stated in the notice of meeting.

                  Section 3. VOTING. Each stockholder entitled to vote in
accordance with the terms of the Certificate of Incorporation and in accordance
with the provisions of these By-Laws shall be entitled to one vote, in person or
by proxy, executed in writing by the stockholder or by its duly authorized
attorney in fact, for each share of stock entitled to vote held by such
stockholder. All elections for directors shall be decided by plurality vote; all
other questions shall be decided by majority vote except as otherwise provided
by the Certificate of Incorporation or the laws of the State of Delaware.

                  Section 4. QUORUM. Except as otherwise required by Law, by the
Certificate of Incorporation or by these By-Laws, the presence, in person or by
proxy, of stockholders holding a majority of the stock of the corporation
entitled to vote shall constitute a quorum at all meetings of the stockholders.
In case a quorum shall not be present at any






meeting, a majority in interest of the stockholders entitled to vote thereat,
present in person or by proxy, shall have power to adjourn the meeting from time
to time, without notice other than announcement at the meeting until the
requisite amount of stock entitled to vote shall be present; provided, that if
the adjournment is for more than thirty days or if after the adjournment a new
record date is fixed for the adjourned meeting, a notice of the adjourned
meeting will be sent to each stockholder of record entitled to vote at the
meeting, as adjourned. At any such adjourned meeting at which the requisite
amount of stock entitled to vote shall be represented, any business may be
transacted which might have been transacted at the meeting as originally
noticed; but only those stockholders entitled to vote at the meeting as
originally noticed shall be entitled to vote at any adjournment or adjournments
thereof, unless a new record date therefor shall have been fixed.

                  Section 5. NOTICE OF MEETINGS. Written notice, stating the
place, date and time of the meeting, and, in the case of a special meeting, the
purpose or purposes for which such meeting has been called, shall be given to
each stockholder entitled to vote thereat at his address as it appears on the
records of the corporation, not less than ten nor more than fifty days before
the date of the meeting.

                  Section 6. ACTION WITHOUT MEETING. Any action required to be
taken at any annual or special meeting of stockholders, or any action which may
be taken at any annual or special meeting, may be taken without a meeting,
without prior notice and without a vote, if a consent in writing, setting forth
the action so taken, shall be signed by the holders of a majority of the
outstanding stock of the corporation.

                                  ARTICLE III
                                   DIRECTORS

                  Section 1. NUMBER AND TERM. The number of authorized Directors
of the Corporation shall be not less than 1 nor more than 15, fixed from time to
time by the Shareholder. The Directors shall be elected at the annual meeting of
the Shareholders and each Director shall be elected to serve until his successor
shall be elected and shall qualify.

                  Section 2. RESIGNATIONS. Any director, member of a committee
or other officer may resign at any time. Such resignation shall be made in
writing, and shall take effect at the time specified therein, and if no time be
specified, at the time of its receipt by the President or Secretary. The
acceptance of a resignation shall not be necessary to make it effective.

                  Section 3. POWERS. The Board of Directors shall exercise all
of the powers of the corporation except such as are by law, or by the
Certificate of Incorporation of the corporation or by these By-Laws conferred
upon or reserved to the stockholders.

                  Section 4. MEETINGS. The newly elected directors may hold
their first meeting for the purpose of the transaction of business, if a quorum
be present, immediately after the annual meeting of the stockholders; or the
time and place of such meeting may be fixed by consent in writing of all the
directors.

                  Regular meetings of the directors may be held without notice
at such places and times as shall be determined from time to time by resolution
of the directors.


                                       2







                  Special meetings of the board may be called by or at the
request of the President, the Secretary or any two directors. Such meeting shall
be held at such place or places as shall be stated in the call of the meeting.
Notice of any special meeting shall be given at least six (6) hours previously
thereto in any one of the following methods: by oral or telephonic notice, by
written notice delivered personally or mailed to each director at his business
address, or by telegram; provided, that if notice is given by mail only, it
shall be given at least forty-eight (48) hours prior to such meeting. If mailed,
such notice shall be deemed to be delivered when deposited in the United States
mail so addressed, with postage thereon prepaid. If notice is given by telegram,
such notice shall be deemed delivered when the telegram is delivered to the
telegraph company. Whenever any notice whatever is required to be given to any
director of the corporation under the Certificate of Incorporation or these
By-laws or any provision of law, a waiver thereof in writing, signed at any
time, whether before or after the time of the meeting, by the director entitled
to such notice, shall be deemed equivalent to the giving of such notice.

                  Members of-the Board of Directors, or any committee designated
by the Board of Directors, may participate in a meeting of the Board of
Directors, or any committee, by means of conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other, and such participation in a meeting shall
constitute presence in person at the meeting.

                  Section 5. COMMITTEES. The Board of Directors may, by
resolution or resolutions passed by a majority of the whole board, designate one
or more committees, each committee to consist of one or more directors of the
corporation. The board may designate one or more directors as alternate members
of any committee, who may replace any absent or disqualified member at any
meeting of the committee. In the absence or disqualification of any member of
such committee or committees, the member or members thereof present at any
meeting and not disqualified from voting, whether or not he or they constitute a
quorum, may unanimously appoint another member of the Board of Directors to act
at the meeting in the place of any such absent or disqualified member.

                  Any such committee, to the extent provided in the resolution
of the Board of Directors, or in these By-Laws, shall have and may exercise all
the powers and authority of the Board of Directors in the management of the
business and affairs of the corporation, and may authorize the seal of the
corporation to be affixed to all papers which may require it; but no such
committee shall have the power or authority in reference to amending the
Certificate of Incorporation, adopting an agreement of merger or consolidation,
recommending to the stockholders the sale, lease or exchange of all or
substantially all of the corporation's property and assets, recommending to the
stockholders a dissolution of the corporation or a revocation of a dissolution,
or amending the By-Laws of the corporation and, unless the resolution, these
By-Laws, or the Certificate of Incorporation expressly so provide, no such
committee shall have the power or authority to declare a dividend or to
authorize the issuance of stock.

                  Section 6. QUORUM. A majority of the directors shall
constitute a quorum for the transaction of business. If at any meeting of the
board there shall be less than a quorum present, a majority of those present may
adjourn the meeting from time to time until a quorum is obtained, and no further
notice thereof need be given other than by announcement at the meeting which
shall be so adjourned.


                                       3







                                   ARTICLE IV
                                    OFFICERS

                  Section 1. OFFICERS. The officers of the corporation shall be
a President, a Treasurer, and a Secretary, all of whom shall be elected by the
Board of Directors and who shall hold office until their successors are elected
and qualified or until their earlier termination, death, resignation or removal.
In addition, the Board of Directors may elect a Chairman, one or more
Vice-Presidents and such Assistant Secretaries and Assistant Treasurers as they
may deem proper. None of the officers of the corporation need be directors. The
officers shall be elected at the first meeting of the Board of Directors after
each annual meeting. More than two offices may be held by the same person.

                  Section 2. OTHER OFFICERS AND AGENTS. The Board of Directors
may appoint such other officers and agents as it may deem advisable, who shall
hold their offices for such terms and shall exercise such powers and perform
such duties as shall be determined from time to time by the Board of Directors.

                  Section 3. CHAIRMAN. The Chairman of the Board of Directors,
if one be elected, shall preside at all meetings of the Board of Directors and
he shall have and perform such other duties as from time to time may be assigned
to him by the Board of Directors.

                  Section 4. PRESIDENT. The President shall have the general
powers and duties of supervision and management usually vested in the office of
President of a corporation. He shall preside at all meetings of the stockholders
if present thereat, and in the absence or non-election of the Chairman of the
Board of Directors, at all meetings of the Board of Directors, and shall have
general supervision, direction and control of the business of the corporation.
Except as the Board of Directors shall authorize the execution thereof in some
other manner, he shall execute bonds, mortgages and other contracts in behalf of
the corporation, and shall cause the seal to be affixed to any instrument
requiring it and when so affixed the seal shall be attested by the signature of
the Secretary or the Treasurer or an Assistant Secretary or an Assistant
Treasurer.

                  Section 5. VICE-PRESIDENT. Each Vice-President shall have such
powers and shall perform such duties as shall be assigned to him by the Board of
Directors, or if no such powers and duties shall be assigned by the Board of
Directors, then such powers and duties as shall be assigned to him by the
Chairman of the Board of Directors or the President.

                  Section 6. TREASURER. The Treasurer shall have the custody of
the corporate funds and securities and shall keep full and accurate account of
receipts and disbursements in books belonging to the corporation. He shall
deposit all moneys and other valuables in the name and to the credit of the
corporation in such depositaries as may be designated by the Board of Directors.

                  The Treasurer shall disburse the funds of the corporation as
may be ordered by the Board of Directors, or the President, taking proper
vouchers for such disbursements. He shall render to the President and Board of
Directors at the regular meetings of the Board of Directors, or whenever they
may request it, an account of all his transactions as Treasurer and of the

                                       4





financial condition of the corporation. If required by the Board of Directors,
he shall give the corporation a bond for the faithful discharge of his duties in
such amount and with such surety as the Board of Directors shall prescribe.

                  Section 7. SECRETARY. The Secretary shall give, or cause to be
given, notice of all meetings of stockholders and directors, and all other
notices required by law or by these By-Laws, and in case of his absence or
refusal or neglect so to do, any such notice may be given by any person
thereunto directed by the President, or by the Board of Directors, or
stockholders, upon whose requisition the meeting is called as provided in these
By-Laws. He shall record all the proceedings of the meetings of the corporation
and of the directors in a book to be kept for that purpose, and shall perform
such other duties as may be assigned to him by the Board of Directors or the
President. He shall have the custody of the seal of the corporation and shall
affix the same to all instruments requiring it, when authorized by the Board of
Directors or the President, and attest the same.

                  Section 8. ASSISTANT TREASURERS AND ASSISTANT SECRETARIES.
Assistant Treasurers and Assistant Secretaries, if any, shall be elected and
shall have such powers and shall perform such duties as shall be assigned to
them, respectively, by the Board of Directors.

                                   ARTICLE V
                                  MISCELLANEOUS

                  Section 1. CERTIFICATES OF STOCK. Certificates of stock,
signed by the President or Vice-President and Secretary or any Assistant
Secretary, shall be issued to each stockholder certifying the number of shares
owned by such stockholder in the corporation. Any or all of the signatures may
be facsimiles.

                  Section 2. TRANSFER OF SHARES. The shares of stock of the
corporation shall be transferable only upon its books by the holders thereof in
person or by their duly authorized attorneys or legal representatives, and upon
such transfer the old certificates shall be surrendered to the corporation by
the delivery thereof to the person in charge of the stock and transfer books and
ledgers, or to such other person as the directors may designate, by whom they
shall be cancelled, and new certificates shall thereupon be issued. A record
shall be made of each transfer and whenever a transfer shall be made for
collateral security, and not absolutely, it shall be so expressed in the entry
of the transfer.

                  Section 3. STOCKHOLDERS RECORD DATE. In order that the
corporation may determine the stockholders entitled to notice of or to vote at
any meeting of stockholders or any adjournment thereof, or to express consent to
corporate action in writing without a meeting, or entitled to receive payment of
any dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any change, conversion or exchange of stock or
for the purpose of any other lawful action, the Board of Directors may fix, in
advance, a record date, which shall not be more than fifty nor less than ten
days before the date of such meeting, nor more than fifty days prior to any
other action. A determination of stockholders of record entitled to notice of or
to vote at a meeting of stockholders shall apply to


                                       5





any adjournment of the meeting; provided, however, that the Board of Directors
may fix a new record date for the adjourned meeting.

                  Section 4. SEAL. The corporate seal shall be circular in form
and shall contain the name of the corporation, its state of incorporation and
the words "CORPORATE SEAL." Said seal may be used by causing it or a facsimile
thereof to be impressed or affixed or reproduced or otherwise.

                  Section 5. FISCAL YEAR. The fiscal year of the corporation,
beginning with the year 1983, shall be the calendar year.

                  Section 6. CHECKS. All checks, drafts or other orders for the
payment of money, notes or other evidences of indebtedness issued in the name of
the corporation shall be signed by such officer or officers, agent or agents of
the corporation, and in such manner as shall be determined from time to time by
resolution of the board of directors.

                  Section 7. INDEMNIFICATION. The corporation may indemnify its
officers, directors, employees and agents to the full extent permitted by law.

                  Section 8. NOTICE AND WAIVER OF NOTICE. Whenever, under the
provisions of law, the Certificate of Incorporation or these By-Laws, notice is
required to be given to any person, it shall not be construed to mean personal
notice, but such notice may be given in writing, by mail, addressed to such
person at his address as it appears on the records of the corporation, with
postage thereon prepaid, and such notice shall be deemed to be given at the time
when the same shall be deposited in the United States mail. Notice to directors
may also be given by any of the methods specified in Article III, Section 8 of
these By-Laws.

                  Whenever any notice whatever is required to be given under the
provisions of any law, the Certificate of Incorporation or these By-Laws, a
waiver thereof in writing, signed by the person or persons entitled to said
notice, whether before or after the time stated therein, shall be deemed
equivalent thereto. Any waiver of notice to stockholders shall set forth in
reasonable detail the purpose or purposes for which the meeting is called and
the time and place thereof. Attendance by a director or stockholder at any
meeting of directors or stockholders, respectively, shall constitute a waiver of
notice of such meeting, except where such director or stockholder attends a
meeting for the express purpose of objecting, at the beginning of such meeting,
to the transaction of business because the meeting is not lawfully called or
convened.

                                   ARTICLE VI
                                   AMENDMENTS

                  These By-Laws may be altered or repealed and By-Laws may be
made at any annual meeting of the stockholders or at any special meeting thereof
if notice of the proposed alteration or repeal or By-Law or By-Laws to be made
be contained in the notice of such special meeting, by the affirmative vote of a
majority of the stock issued and outstanding and entitled to vote thereat, or by
the affirmative vote of a majority of the Board of Directors, at any regular or
special meeting of the Board of Directors.


                                       6

EX-3.45

                                                                    EXHIBIT 3.45


                          CERTIFICATE OF INCORPORATION

                                       OF

                          EXTENDICARE OF INDIANA, INC.

                                     * * * *

                  1. The name of the corporation is

                          EXTENDICARE OF INDIANA, INC.

                  2. The address of its registered office in the State of
Delaware is Corporation Trust Center, 1209 Orange Street, in the City at
Wilmington, County of New Castle. The name of its registered agent at such
address is The Corporation Trust Company.

                  3. The nature of the business or purpose to be conducted or
promoted is:

                  To engage in any lawful act or activity for which corporations
may be organized under the General Corporation Law of Delaware.

                  4. The total number of shares of stock, which the corporation
shall have authority to issue is one thousand (1,000); all of such shares shall
be without par value.

                  5. The name and mailing address of the incorporator is as
follows:

                      NAME                            MAILING ADDRESS
                      ----                            ---------------

                      Roch Carter                     105 West Michigan Street
                                                      Milwaukee, Wisconsin 53203

                  6. The corporation is to have a perpetual existence.

                  7. In furtherance and not in limitation of the powers
conferred by statute, the board of directors is expressly authorized to make,
alter or repeal the by-laws of the corporation.

                  8. The number of directors shall be such as from time to time
may be fixed by, or in the manner provided in, the by-laws. Elections of
directors need not be by written ballot unless the by-laws of the corporation
shall so provide.

                  9. The corporation reserves the right to amend, alter, change
or repeal any provision contained in this certificate of incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.

EX-3.46

                                                                    EXHIBIT 3.46


                                     BYLAWS
                                       OF
                          EXTENDICARE OF INDIANA, INC.

                                    ARTICLE I
                                     OFFICES

                  Section 1. REGISTERED OFFICE. The registered office shall be
in the City of Wilmington, County of New Castle.

                  Section 2. OTHER OFFICES. The corporation may have other
offices, either within or without the State of Delaware, at such place or places
as the Board of Directors may from time to time appoint or the business of the
corporation may require.

                                   ARTICLE II
                            MEETINGS OF STOCKHOLDERS

                  Section 1. ANNUAL MEETINGS. Annual meetings of stockholders
for the election of directors and for such other business as may properly come
before the meeting shall be held at such place, either within or without the
State of Delaware, as the Board of Directors shall determine and as set forth in
the notice of the meeting.

                  Annual meetings of stockholders shall be held during the
fourth week of March in each year at a time and date to be determined by the
Board of Directors. At each annual meeting, the stockholders shall elect a Board
of Directors and they may transact such other business as may properly come
before the meeting.

                  Section 2. OTHER MEETINGS. Meetings of stockholders for any
purpose or purposes may be called by the President, the Secretary, the Board of
Directors or such other persons as may be authorized by law, and shall be held
at such time and place, within or without the State of Delaware, as shall be
stated in the notice of meeting.

                  Section 3. VOTING. Each stockholder entitled to vote in
accordance with the terms of the Certificate of Incorporation and in accordance
with the provisions of these By-Laws shall be entitled to one vote, in person or
by proxy, executed in writing by the stockholder or by its duly authorized
attorney in fact, for each share of stock entitled to vote held by such
stockholder. All elections for directors shall be decided by plurality vote; all
other questions shall be decided by majority vote except as otherwise provided
by the Certificate of Incorporation or the laws of the State of Delaware.

                  Section 4. QUORUM. Except as otherwise required by Law, by the
Certificate of Incorporation or by these By-Laws, the presence, in person or by
proxy, of stockholders holding a majority of the stock of the corporation
entitled to vote shall constitute a quorum at all meetings of the stockholders.
In case a quorum shall not be present at any meeting, a majority in interest of
the stockholders entitled to vote thereat, present in person or by proxy, shall
have power to adjourn the meeting from time to time, without notice other than
announcement at the meeting until the requisite amount of stock entitled to vote
shall be present; provided, that if the adjournment is for more than thirty days
or if after the adjournment a new


record date is fixed for the adjourned meeting, a notice of the adjourned
meeting will be sent to each stockholder of record entitled to vote at the
meeting, as adjourned. At any such adjourned meeting at which the requisite
amount of stock entitled to vote shall be represented, any business may be
transacted which might have been transacted at the meeting as originally
noticed; but only those stockholders entitled to vote at the meeting as
originally noticed shall be entitled to vote at any adjournment or adjournments
thereof, unless a new record date therefor shall have been fixed.

                  Section 5. NOTICE OF MEETINGS. Written notice, stating the
place, date and time of the meeting, and, in the case of a special meeting, the
purpose or purposes for which such meeting has been called, shall be given to
each stockholder entitled to vote thereat at his address as it appears on the
records of the corporation, not less than ten nor more than fifty days before
the date of the meeting.

                  Section 6. ACTION WITHOUT MEETING. Any action required to be
taken at any annual or special meeting of stockholders, or any action which may
be taken at any annual or special meeting, may be taken without a meeting,
without prior notice and without a vote, if a consent in writing, setting forth
the action so taken, shall be signed by the holders of a majority of the
outstanding stock of the corporation.

                                   ARTICLE III
                                    DIRECTORS

                  Section 1. NUMBER AND TERM. The number of authorized Directors
of the Corporation shall be not less than 1 nor more than 15, fixed from time to
time by the Shareholder. The Directors shall be elected at the annual meeting of
the Shareholders and each Director shall be elected to serve until his successor
shall be elected and shall qualify.

                  Section 2. RESIGNATIONS. Any director, member of a committee,
or other officers may resign at any time. Such resignation shall be made in
writing, and shall take effect at the time specified therein, and if no time be
specified, at the time of its receipt by the President or Secretary. The
acceptance of a resignation shall not be necessary to make it effective.

                  Section 3. POWERS. The Board of Directors shall exercise all
of the powers of the corporation except such as are by law, or by the
Certificate of Incorporation of the corporation or by these By-Laws conferred
upon or reserved to the stockholders.

                  Section 4. MEETINGS. The newly elected directors may hold
their first meeting for the purpose of the transaction of business, if a quorum
be present, immediately after the annual meeting of the stockholders; or the
time and place of such meeting may be fixed by consent in writing of all the
directors.

                  Regular meetings of the directors may be held without notice
at such places and times as shall be determined from time to time by resolution
of the directors. Special meetings of the board may be called by or at the
request of the President, the Secretary or any two directors.

                  Such meeting shall be held at such place or places as shall be
stated in the call of the meeting. Notice of any special meeting shall be given
at least six (6)


hours previously thereto in any one of the following methods: by oral or
telephonic notice, by written notice delivered personally or mailed to each
director at his business address, or by telegram; provided, that if notice is
given by mail only, it shall be given at least forty-eight (48) hours prior to
such meeting. If mailed, such notice shall be deemed to be delivered when
deposited in the United States mail so addressed, with postage thereon prepaid.
If notice is given by telegram, such notice shall be deemed delivered when the
telegram is delivered to the telegraph company. Whenever any notice whatever is
required to be given to any director of the corporation under the Certificate of
Incorporation of these By-Laws or any provision of law, a waiver thereof in
writing, signed at any time, whether before or after the time of the meeting, by
the director entitled to such notice, shall be deemed equivalent to the giving
of such notice.

                  Members of the Board of Directors, or any committee designated
by the Board of Directors, may participate in a meeting of the Board of
Directors, or any committee, by means of conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other, and such participation in a meeting shall
constitute presence in person at the meeting.

                  Section 5. COMMITTEES. The Board of Directors may, by
resolution or resolutions passed by a majority of the whole board, designate one
or more committees, each committee to consist of one or more directors of the
corporation. The board may designate one or more directors as alternate members
of any committee, who may replace any absent or disqualified member at any
meeting of the committee. In the absence or disqualification of any member of
such committee or committees, the member or members thereof present at any
meeting and not disqualified from voting, whether or not he or they constitute a
quorum, may unanimously appoint another member of the Board of Directors to act
at the meeting in the place of any such absent or disqualified member.

                  Any such committee, to the extent provided in the resolution
of the Board of Directors, or in these By-Laws, shall have and may exercise all
the powers and authority of the Board of Directors in the management of the
business and affairs of the corporation, and may authorize the seal of the
corporation to be affixed to all papers which may require it; but no such
committee shall have the power or authority in reference to amending the
Certificate of Incorporation, adopting an agreement of merger or consolidation,
recommending to the stockholders the sale, lease or exchange of all or
substantially all of the corporation's property and assets, recommending to the
stockholders a dissolution of the corporation or a revocation of a dissolution,
or amending the By-Laws of the corporation and, unless the resolution, these
By-Laws, or the Certificate of Incorporation expressly so provide, no such
committee shall have the power of authority to declare a dividend or to
authorize the issuance of stock.

                  Section 6. QUORUM. A majority of the directors shall
constitute a quorum for the transaction of business. If at any meeting of the
board there shall be less than a quorum present, a majority of those present may
adjourn the meeting from time to time until a quorum is obtained, and no further
notice thereof need be given other than by announcement at the meeting which
shall be so adjourned.



                                   ARTICLE IV
                                    OFFICERS

                  Section 1. OFFICERS. The officers of the corporation shall be
a President, a Treasurer, and a Secretary, all of whom shall be elected by the
Board of Directors and who shall hold office until their successors are elected
and qualified or until their earlier termination, death, resignation or removal.
In addition, the Board of Directors may elect a Chairman, one or more
Vice-Presidents and such Assistant Secretaries and Assistant Treasurers as they
may deem proper. None of the officers of the corporation need be directors. The
officers shall be elected at the first meeting of the Board of Directors after
each annual meeting. More than two offices may be held by the same person.

                  Section 2. OTHER OFFICERS AND AGENTS. The Board of Directors
may appoint such other officers and agents as it may deem advisable, who shall
hold their offices for such terms and shall exercise such powers and perform
such duties as shall be determined from time to time by the Board of Directors.

                  Section 3. CHAIRMAN. The Chairman of the Board of Directors,
if one be elected, shall preside at all meetings of the Board of Directors and
he shall have and perform such other duties as from time to time may be assigned
to him by the Board of Directors.

                  Section 4. PRESIDENT. The President shall have the general
powers and duties of supervision and management usually vested in the office of
President of a corporation. He shall preside at all meetings of the stockholders
if present thereat, and in the absence or non-election of the Chairman of the
Board of Directors, at all meetings of the Board of Directors, and shall have
general supervision, direction and control of the business of the corporation.
Except as the Board of Directors shall authorize the execution thereof in some
other manner, he shall execute bonds, mortgages and other contracts in behalf of
the corporation, and shall cause the seal to be affixed to any instrument
requiring it and when so affixed the seal shall be attested by the signature of
the Secretary or the Treasurer or an Assistant Secretary or an Assistant
Treasurer.

                  Section 5. VICE-PRESIDENT. Each Vice-President shall have such
powers and shall perform such duties as shall be assigned to him by the Board of
Directors, or if no such powers and duties shall be assigned by the Board of
Directors, then such powers and duties as shall be assigned to him by the
Chairman of the Board of Directors or the President.

                  Section 6. TREASURER. The Treasurer shall have the custody of
the corporate funds and securities and shall keep full and accurate account of
receipts and disbursements in books belonging to the corporation. He shall
deposit all moneys and other valuables in the name and to the credit of the
corporation in such depositaries as may be designated by the Board of Directors.

                  The Treasurer shall disburse the funds of the corporation as
may be ordered by the Board of Directors, or the President, taking proper
vouchers for such disbursements. He shall render to the President and Board of
Directors at the regular meetings of the Board of Directors, or whenever they
may request it, an account of all his transactions as Treasurer and of the


financial condition of the corporation. If required by the Board of Directors,
he shall give the corporation a bond for the faithful discharge of his duties in
such amount and with such surety as the Board of Directors shall prescribe.

                  Section 7. SECRETARY. The Secretary shall give, or cause to be
given, notice of all meetings of stockholders and directors, and all other
notices required by law or by these By-Laws, and in case of his absence or
refusal or neglect so to do, any such notice may be given by any person
thereunto directed by the President, or by the Board of Directors, or
stockholders, upon whose requisition the meeting is called as provided in these
By-Laws. He shall record all the proceedings of the meetings of the corporation
and of the directors in a book to be kept for that purpose, and shall perform
such other duties as may be assigned to him by the Board of Directors or the
President. He shall have the custody of the seal of the corporation and shall
affix the same to all instruments requiring it, when authorized by the Board of
Directors or the President, and attest the same.

                  Section 8. ASSISTANT TREASURERS AND ASSISTANT SECRETARIES.
Assistant Treasurers and Assistant Secretaries, if any, shall be elected and
shall have such powers and shall perform such duties as shall be assigned to
them, respectively, by the Board of Directors.

                                    ARTICLE V
                                  MISCELLANEOUS

                  Section 1. CERTIFICATES OF STOCK. Certificates of stock,
signed by the President or Vice-President and Secretary or any Assistant
secretary, shall be issued to each stockholder certifying the number of shares
owned by such stockholder in the corporation. Any or all of the signatures may
be facsimiles.

                  Section 2. TRANSFER OF SHARES. The shares of stock of the
corporation shall be transferable only upon its books by the holders thereof in
person or by their duly authorized attorneys or legal representatives, and upon
such transfer the old certificates shall be surrendered to the corporation by
the delivery thereof to the person in charge of the stock and transfer books and
ledgers, or to such other person as the directors may designate, by whom they
shall be cancelled, and new certificates shall thereupon be issued. A record
shall be made of each transfer and whenever a transfer shall be made for
collateral security, and not absolutely, it shall be so expressed in the entry
of the transfer.

                  Section 3. STOCKHOLDERS RECORD DATE. In order that the
corporation may determine the stockholders entitled to notice of or to vote at
any meeting of stockholders or any adjournment thereof, or to express consent to
corporate action in writing without a meeting, or entitled to receive payment of
any dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect to any change, conversion or exchange of stock or
for the purpose of any other lawful action, the Board of Directors may fix, in
advance, a record date, which shall not be more than fifty nor less than ten
days before the date of such meeting nor more than fifty days prior to any other
action. A determination of stockholders of record entitled to notice of or to
vote at a meeting of stockholders shall apply to


any adjournment of the meeting; provided, however, that the Board of Directors
may fix a new record date for the adjourned meeting.

                  Section 4. SEAL. The corporate seal shall be circular in form
and shall contain the name of the corporation, its state of incorporation and
the words "CORPORATE SEAL." Said seal may be used by causing it or a facsimile
thereof to be impressed or affixed or reproduced otherwise.

                  Section 5. FISCAL YEAR. The fiscal year of the corporation,
beginning with the year 1994, shall be the calendar year.

                  Section 6. CHECKS. All checks, drafts or other orders for the
payment of money, notes or other evidences of indebtedness issued in the name of
the corporation shall be signed by such officer or officers, agent or agents of
the corporation, and in such manner as shall be determined from time to time by
resolution of the Board of Directors.

                  Section 7. INDEMNIFICATION. The corporation may indemnify its
officers, directors, employees and agents to the full extent permitted by law.

                  Section 8. NOTICE AND WAIVER OF NOTICE. Whenever, under the
provisions of law, the Certificate of Incorporation or these By-Laws, notice is
required to be given to any person, it shall not be construed to mean personal
notice, but such notice may be given in writing, by mail, addressed to such
person at his address as it appears on the records of the corporation, with
postage thereon prepaid, and such notice shall be deemed to be given at the time
when the same shall be deposited in the United States mail. Notice to directors
may also be given by any of the methods specified in Article III, Section 8, of
these By-Laws.

                  Whenever any notice whatever is required to be given under the
provisions of any law, the Certificate of Incorporation or these By-Laws, a
waiver thereof in writing, signed by the person or persons entitled to said
notice, whether before or after the time stated therein, shall be deemed
equivalent thereto. Any waiver of notice to stockholders shall set forth in
reasonable detail the purpose or purposes for which the meeting is called and
the time and place thereof. Attendance by a director or stockholder at any
meeting of directors or stockholders, respectively, shall constitute a waiver of
notice of such meeting, except where such director or stockholder attends a
meeting for the express purpose of objecting, at the beginning of such meeting,
to the transaction of business because the meeting is not lawfully called or
convened.

                                   ARTICLE VI
                                   AMENDMENTS

                  These By-Laws may be altered or repealed and By-Laws may be
made at any annual meeting of the stockholders or at any special meeting thereof
if notice of the proposed alteration or repeal or By-Law or By-Laws to be made
be contained in the notice of such special meeting, by the affirmative vote of a
majority of the stock issued and outstanding and entitled to vote thereat, or by
the affirmative vote of a majority of the Board of Directors, at any regular or
special meeting of the Board of Directors.

EX-3.47

                                                                    EXHIBIT 3.47

                            ARTICLES OF INCORPORATION

                                       OF

                   FIR LANE TERRANCE CONVALESCENT CENTER, INC.

                  KNOW ALL MEN BY THESE PRESENTS: That we, the undersigned,
Roberta L. Goodwin and Marvin H. Goodwin, all natural persons of full legal age,
and citizens of the United States of America, having this day voluntarily
associated ourselves for the purpose of organizing a corporation under the laws
of the State of Washington, do, to that end and for that purpose and object,
make, subscribe and acknowledge these written Articles of Incorporation in
triplicate.

                                   ARTICLE I

                  The name of this corporation shall be "FIR LANE TERRACE
CONVALESCENT CENTER, INC."

                                   ARTICLE II

                  The duration of the corporation shall be perpetual.

                                  ARTICLE III

                  The purposes for which this corporation is formed are as
follows:

                  1. To engage in the business of operating a convalescent and
nursing home and such other activities as may from time to time be necessary,
convenient or incidental to the business of the corporation.

                  2. To purchase, lease, hold, mortgage, sell and transfer real
or personal property of all kinds and descriptions.

                  3. To appoint such officers, agents, servants and employees as
the business of the corporation may from time to time require; to define their
powers, to prescribe their duties; to fix their compensation, and to discharge
them, in accordance with the laws of the State of Washington.

                  4. To make and use a corporate seal, and to alter the same at
pleasure.

                  5. To make By-Laws not inconsistent with these Articles, the
laws of the State of Washington or the United States.

                  6. To have all powers necessary and proper for the management
of property, the regulation of the affairs of this corporation, the transfer of
its stock and for carrying on all kinds of business within the purposes of the
corporation.

                  7. To act as broker in the purchase or sale of any and all
kinds of personal or real property, including insurance, and to charge for such
services.






                  8. To construct, purchase, or otherwise acquire; to own, hold,
lease, mortgage, pledge or hypothecate; to sell, assign, manage, conduct,
develop, improve and in every lawful way and manner to deal in and with any and
all kinds of property rights and assets.

                  9. To apply for, obtain, hold and use any federal, state,
municipal and/or foreign licenses or permits required in connection with the
business of the corporation.

                  10. To buy, sell, manufacture, produce and dispose of all
kinds of goods, wares, merchandise, commodities and supplies, to generally
engage in and carry on any form of manufacturing, mercantile, contracting or
transportation enterprise necessary, convenient or incidental to the business of
the corporation.

                  11. To loan money of the corporation and take and hold
security for the same.

                  12. To borrow money for any of the purposes of the corporation
and to secure the same with bonds or mortgages.

                  13. To enter into, make, perform and carry out contracts of
every sort and kind with any person, firm, corporation, public, private or
municipal, or body politic, and with the Government of the United States, any
state or territory thereof, or any foreign government.

                  14. It is intended that the foregoing clauses shall be
considered as powers, as well as the purposes of this corporation, and the
foregoing enumeration of specific powers and purposes shall not be held in any
way to limit or restrict the general powers and privileges which may be
exercised by or under the laws of the State of Washington, particularly those
referred to in Section 23A.08.020, Revised Code of Washington.

                                   ARTICLE IV

                  The amount of the total authorized capital stock of this
corporation is $50,000.00, divided into Five Thousand Shares of common stock of
the par value of $10.00 for each share of said stock.

                                   ARTICLE V

                  The voting power of this corporation shall be vested in the
common stock, each share of which shall be entitled to one vote.

                                   ARTICLE VI

                  The corporation, in conformity with the provisions of Section
23A.12.020, R.C.W., sub-section 8, will not commence business until
consideration of the value of at least $500.00 has been received for the
issuance of shares.

                                  ARTICLE VII

                  In the event that any stockholder desires to sell his share or
shares of stock, he must first offer them for sale to the remaining stockholder
at the book value thereof, it being the intention hereof to give them a
preference in the purchase of the same, and any attempted sale in


                                       2



violation of this provision shall be null and void. A stockholder desiring to
sell his stock shall file notice in writing of his intention to so do with the
Secretary of the corporation, and unless the stock so offered for sale is
purchased by any or all of the other stockholders within 120 days thereafter,
they shall be deemed to have waived their privilege of purchasing the same, and
said stockholder shall be at liberty to sell to any one else.

                                  ARTICLE VIII

                  The location and the post office address of the registered
office of this corporation in the State of Washington shall be 260 Island Lake
Drive, Shelton, Washington 98584; and the name of its registered agent at said
address is Roberta L. Goodwin.

                                   ARTICLE IX

                  The initial Board of Directors shall be two in number and the
names and post office addresses of the directors who shall manage its affairs
from the time of incorporation until the first annual meeting on the 15th day of
November, 1979, or until their successors be elected and qualified are as
follows:

NAME                                ADDRESS

Roberta L. Goodwin                  260 Island Lake Drive, Shelton, WA.  98584
Marvin H. Goodwin                   260 Island Lake Drive, Shelton, WA  98584






                                       3

EX-3.48

                                                                    EXHIBIT 3.48

                                     BYLAWS
                                       OF
                   FIR LANE TERRACE CONVALESCENT CENTER, INC.

                                   ARTICLE I
                                PLACE OF BUSINESS

                  Section 1. PRINCIPAL LOCATION. The principal office of the
corporation for the transaction of business shall be at such location as the
Board of Directors shall determine from time to time.

                  Section 2. ADDITIONAL OFFICES. Additional business offices may
be established at such other places as the Board of Directors may from time to
time designate.

                                   ARTICLE II
                                    DIRECTORS

                  Section 1. INITIAL BOARD OF DIRECTORS. Each member of the
Initial Board of Directors, appointed through the Articles of Incorporation,
shall serve until his death, resignation, until removed, or until a Board of
Directors is elected by the shareholders at the first shareholders meeting.

                  Section 2. NUMBER. The number of authorized Directors of the
Corporation shall be not less than 1 nor more than 15, fixed from time to time
by the Shareholder. The Directors shall be elected at the annual meeting of the
Shareholders and each Director shall be elected to serve until his successor
shall be elected and shall qualify.

                  Section 3. TERM. The directors shall be elected at the annual
meeting of shareholders and each director shall be elected to serve for a term
of one (1) year; provided that in the event of failure to hold such meeting or
to hold such election at such meeting, the directors may be elected at any
special meeting of the stockholders called for that purpose.

                  Section 4. QUORUM. A majority of the directors shall
constitute a quorum for the transaction of business, and the act of a majority
of the directors present at any meeting at which a quorum is present shall be
the act of the Board of Directors.

                  Section 5. NOTICES. Regular meetings of the Board of Directors
may be held without notice of the time, date, location or purpose of the
meeting. Special meetings shall be preceded by at least two days notice of the
time, date and location of said meeting. Any notice of a meeting required to be
given or which may be given to a director shall be personally served or mailed
by United States Mail, postage prepaid, properly addressed to the last known
address of such director and, if mailed, shall be deemed to be given and
received three (3) days following the date of mailing. Any director may waive
notice of any meeting, so long as said waiver is in writing, signed by the
director entitled to notice and delivered to the corporation for inclusion in
the minutes of the corporation. Notwithstanding the foregoing, attendance of a
director at a meeting shall constitute a waiver of notice of such meeting except
where the director attends a meeting for the express purpose of objecting to the
transaction of any business because the meeting is not lawfully called or
convened and where said director does not thereafter vote







for or assent to any action taken at the said meeting. Neither the business to
be transacted at, nor the purpose of, any regular or special meeting of the
Board of Directors need be specified in the notice or waiver of notice of such
meeting.

                  Section 6. POWERS AND DUTIES. The Board of Directors shall be
responsible for the management of the business of the corporation, and, subject
to the restrictions imposed by law, by the Articles of Incorporation, or by
these Bylaws, may exercise all the powers of the corporation.

                  Section 7. COMMITTEES. By resolution adopted by a majority of
the full Board of Directors, the Board of Directors may appoint from among its
members an Executive Committee of not less than two nor more than five members,
one of whom shall be the President (who shall be the Chairman of the Executive
Committee). The Board of Directors may also designate one or more of its members
as alternates to serve as a member or members of the Executive Committee in the
absence of a regular member or members. The Executive Committee shall have and
may exercise all the authority of the Board of Directors during the intervals
between meetings of the Board of Directors, except that the Executive Committee
(and other committees) shall not have the authority to (1) declare dividends or
distributions, except according to a general formula or method prescribed by the
Board of Directors, (2) approve or recommend to shareholders actions or
proposals required by this title to be approved by shareholders, (3) fill
vacancies on the Board of Directors or any committee thereof, (4) amend the
Articles of Incorporation, (5) adopt, amend or repeal the Bylaws, (6) authorize
or approve the issuance or reacquisition of shares unless pursuant to general
formula or method specified by the Board of Directors, (7) fix compensation of
any director for serving on the Board of Directors or any committee, (8) approve
a plan of merger, consolidation or exchange of shares not requiring shareholder
approval, or (9) appoint other committees of the Board of Directors.

                  The Board of Directors may also appoint from among its own
members such other committees as the Board of Directors may determine, which
shall in each case consist of not less than two (2) directors, and which shall
have such powers and duties as shall from time to time be prescribed by the
Board.

                  A majority of the members of any committee may fix its rules
of procedure. All actions by any committee shall be reported to the Board of
Directors at a meeting succeeding such action and shall be subject to revision,
alteration, and approval by the Board of Directors; provided that no rights or
acts of third parties shall be affected by any such revision or alteration.

                  Members of any committee may participate in a meeting of such
committee by means of a conference telephone or similar communications equipment
by means of which all persons participating in the meeting can hear each other
at the same time, and participation by such means shall constitute presence in
person at a meeting.

                  Section 8. SALARY. Directors may receive a salary for their
services as directors but any such salary must be approved by unanimous vote of
all of the directors. Nothing herein contained shall be construed to preclude
any director from serving the corporation in any other capacity as an officer,
agent or otherwise and receiving compensation therefor so long as the
compensation is approved by the Board of Directors.






                  Section 9. VACANCY. Any vacancy that occurs in the Board of
Directors may be filled by a majority of the remaining directors or by the
shareholders, and each director so elected shall hold office until his successor
is selected at the next meeting of shareholders held for that purpose.

                  Section 10. CONSENT AND WAIVER OF NOTICE. Any transactions of
the Board of Directors at any meeting thereof, regardless of how or whether call
was made or notice given, shall be as valid as though transacted at a meeting
duly held after regular call and notice, if a quorum be present, and if, either
before or after the meeting, each of the directors entitled to vote and not
present in person sign a written waiver of notice, or a consent to the holding
of such meeting, or an approval of the minutes thereof. All such waivers,
consents or approvals shall be filed with the Secretary of this corporation and
made a part of the records of the meeting.

                  Whenever any notice whatsoever is required to be given under
the provisions of these Bylaws, a waiver thereof in writing signed by the person
or persons entitled to such notice, whether before or after the time stated
therein, shall be deemed equivalent to the actual giving of such notice.

                  Any action, which under any provision of these Bylaws might be
taken at a meeting of the directors, may be taken without a meeting if a record
or memorandum thereof be made in writing and signed by all of the directors who
would be entitled to vote at a meeting for such purpose and such record or
memorandum be filed with the Secretary and made a part of the corporate records.

                  A director who is present at a meeting at which action on any
corporate matter is taken shall be presumed to have assented to the action taken
unless his dissent shall be entered in the minutes of the meeting or unless he
shall file his written dissent to such action with the person acting as
Secretary before the adjournment of the meeting or shall forward such dissent by
registered mail to the Secretary immediately after the adjournment.

                  Section 11. CONFERENCE TELEPHONE CALLS. Members of the Board
of Directors may participate in a meeting of such Board by means of a conference
telephone or similar communications equipment by means of which all persons
participating in the meeting can hear each other at the same time, and
participation by such means shall constitute presence in person at a meeting.

                                  ARTICLE III
                                    OFFICERS

                  Section 1. APPOINTMENT AND QUALIFICATIONS. The officers of
this corporation shall consist of a President, and such other officers as may be
chosen by the Board of Directors, including one or more Vice-Presidents,
Treasurer, Secretary and one or more Assistant-Secretaries. No officer shall
execute, acknowledge or verify any instrument in more than one capacity if such
instrument be required by law or these Bylaws to be executed, acknowledged or
verified, as the case may be, by any two or more officers, except that when all
of the issued and outstanding shares of the corporation is owned by one
shareholder, one person






may hold all or any combination of offices and any such one person may execute,
acknowledge or verify any such instrument in more than one capacity.

                  Section 2. TERMS AND COMPENSATION. The terms of office and the
salary of each of said officers and the manner and time of the payment of such
salaries shall be fixed and determined by the Board of Directors and may be
altered by said Board from time to time, and at any time at its pleasure. Any
officer may be removed at any time by the Board.

                                   ARTICLE IV
                          POWERS AND DUTIES OF OFFICERS

                  Section 1. PRESIDENT. The powers and duties of the President
shall be:

                  (1) To preside at all meetings of the Board of Directors or of
the shareholders, regular and special.

                  (2) Except when otherwise directed by the Board of Directors,
to affix the signature of the corporation to all deeds, conveyances, mortgages,
bonds, contracts and other instruments in writing and other papers that may
require the same, to sign certificates of shares of the corporation; and in
general to supervise and control all of the business affairs of the corporation.
Subject to the direction of the Board of Directors, the President shall
supervise and control all officers, agents and employees of the corporation.
Unless otherwise directed by the Board of Directors or by law, all deeds,
conveyances, mortgages, bonds, contracts and other instruments of the
corporation need only be signed by the President and need not be signed by the
Secretary or any other officer of the corporation.

                  (3) To enforce these Bylaws and perform all of the duties
incident to the office and which are required by law.

                  Section 2. VICE-PRESIDENT. In case of the absence, disability
or death of the President, the Vice-President of this corporation, if the
corporation shall have a Vice President, shall have such powers and perform such
duties as may be granted or prescribed by the Board of Directors from time to
time.

                  At all times, the Vice-President shall have the power to
countersign such instruments, if any, as may by law require execution,
acknowledgment, or verification by two officers.

                  Section 3. SECRETARY. The powers and duties of the Secretary,
if the corporation shall have a Secretary shall be:

                  (1) To keep full and complete records of the meetings of the
Board of Directors and of the shareholders.

                  (2) To keep the seal of the corporation and to affix the same
to all instruments which may require it.





                  (3) To make service and publication of all notices that may be
necessary or proper, without command or direction from anyone.

                  To transfer upon the books of the corporation any and all
shares; provided, however, that no certificate of shares shall be issued or
delivered, or if issued or delivered, shall have any validity whatsoever, until
and unless it has been signed by the President of the corporation.

                  (4) Generally to have such powers and perform such duties as
pertain to his office and as may be required by the Board of Directors.

                  Section 4. TREASURER. If the corporation shall have a
Treasurer, the Treasurer shall receive all moneys belonging to or paid into the
corporation and give receipts therefor; and shall deposit such moneys, as the
treasurer shall be directed by the Board of Directors, with one or more solvent
and reputable banks to be designated by the Board of Directors; and shall keep
full and complete records of the funds received and the disbursement thereof.
The treasurer shall render to the shareholders at the regular annual meeting
thereof, and also to the Board of Directors at any meeting thereof, or from time
to time whenever the Board of Directors or the President may require, an account
of all transactions as Treasurer and of the financial condition of the
corporation, and shall perform such other duties as may from time to time be
prescribed by the Board of Directors. The treasurer shall exhibit or cause to be
exhibited the books of the corporation to the Board of Directors, or to any
committee appointed by the Board, or to any director on application during
business hours, or to any other person entitled to inspect such books pursuant
to pertinent provisions of the Business Corporation Act of the State of
Washington.

                  At all times, the Treasurer shall have the power to
countersign such instrument, if any, as may by law require execution,
acknowledgment, or verification by two officers.

                  The Treasurer shall have such powers and perform such duties
as pertain to the office of the treasurer and as may be required by the Board of
Directors.

                  Section 5. OTHER OFFICERS. The Board of Directors may appoint
such other officers as the business of the Corporation may require, each of whom
shall hold office for such period, have such authority and perform such duties
as are provided in the Bylaws or as the Board of Directors may from time to time
determine.

                                   ARTICLE V
                                  SHAREHOLDERS

                  Section 1. PLACE OF MEETING. Notwithstanding anything to the
contrary in these Bylaws, any meeting (whether annual, special or adjourned) of
the stockholders of this corporation may be held at any place within or without
the State of Washington which has been designated therefor by the Board of
Directors.

                  Section 2. ANNUAL MEETING. Subject to the foregoing
provisions, the annual meeting of the stockholders shall be held each year at
the principal office of the corporation in the City of Shelton, State of
Washington, or at such other convenient place





designated by the President, during the fourth week of March, at a day and time
called by the President. At said annual meeting, directors of the corporation
shall be elected, reports of the affairs of the corporation shall be considered
and any other business may be transacted which is within the powers of the
stockholders to transact.

                  The corporation shall notify shareholders of the date, time
and place of each annual meeting and each special meeting of the shareholders.
Said notice shall be given no fewer than 10 nor more than 60 days before the
meeting date, except that notice of a shareholders' meeting to act on an
amendment to the Articles of Incorporation, a plan of merger or share exchange,
a proposed sale of assets pursuant to RCW 23B. 12.020, or the dissolution of the
corporation shall be given no fewer than 20 nor more than 60 days before the
meeting date. In the case of a notice of a special meeting of shareholders, the
notice shall also include a description of the purpose or purposes for which the
meeting is called.

                  Notice of special meetings of stockholders shall be given by
written notice personally served on each shareholder, or deposited in the United
States mail, postage prepaid, and addressed to him at his last known post office
address appearing upon the books of the corporation. Such notice, if mailed,
shall be deemed to be given and received three (3) days following the date of
mailing.

                  In the event the annual meeting be not held, or the directors
be not elected thereat, the directors may be elected at a special meeting held
for that purpose, and it shall be the duty of the President, the Vice-President,
or the Secretary, upon the demand of any shareholder entitled to vote at such
meeting, to call such special meeting.

                  Section 3. SPECIAL MEETINGS. Subject to Section (2) of this
Article, special meetings of the shareholders may be called at any time by the
President or by the Board of Directors or by one or more shareholders holding
not less than one-tenth (1/10) of the voting power of the corporation.

                  Section 4. CONSENT AND WAIVER OF NOTICE. Any transactions of
the shareholders at any meeting thereof, regardless of how or whether call was
made or notice given, shall be as valid as though transacted at a meeting duly
held after regular call and notice, if a quorum be present, either in person or
by proxy, and if, either before or after the meeting, each of the shareholders
entitled to vote and not present in person or by proxy sign a written waiver of
notice, or a consent to the holding of such meeting, or an approval of the
minutes thereof. All such waivers, consents or approvals shall be filed with the
Secretary and made a part of the records of the meeting.

                  Whenever any notice whatsoever is required to be given under
the provisions of these Bylaws, a waiver thereof in writing signed by the person
or persons entitled to such notice, whether before or after the time stated
therein, shall be deemed equivalent to the actual giving of such notice.

                  A shareholder's attendance at a meeting waives objection to
lack of notice or defective notice of the meeting, unless the shareholder at the
beginning of the meeting objects to holding the meeting or transacting business
at the meeting. A shareholder waives objection to





consideration of a particular matter at a meeting that is not within the purpose
or purposes described in the meeting notice unless the shareholder objects to
consideration of the matter when it is presented.

                  Any action, which under any provisions of these Bylaws might
be taken at a meeting of the shareholders, may be taken without a meeting if a
record or memorandum thereof be made in writing and signed by all of the holders
of shares who would be entitled to vote at a meeting for such purpose and such
record or memorandum be filed with the Secretary and made a part of the
corporate records. The consent shall have the same force and effect as a
unanimous vote of shareholders, and may be stated as such in any articles or
document filed with the Secretary of State.

                  Section 5. QUORUM, VOTING AND PROXIES. At all meetings of the
shareholders (whether annual, special or adjourned) the presence in person or by
proxy in writing of the holders of a majority of the shares entitled to vote at
that meeting shall constitute a quorum for the transaction of business. Each
share shall entitle the duly qualified and registered holder thereof to one
vote. All proxies shall be in writing subscribed by the party entitled to vote
the number of shares represented thereby, or by his duly authorized attorney,
and no such proxy shall be valid or confer any right or authority to vote or act
thereunder unless such proxy has been offered for filing to, and left with, the
Secretary of the corporation prior to the meeting at which the same is to be
used; provided, however, that in case any meeting of shareholders whatsoever
(whether annual, special or adjourned) shall have been for any cause adjourned,
proxies shall be valid and may be used at such adjourned meeting, which have
been offered for filing to, and left with the Secretary of the corporation prior
to the date upon which said adjourned meeting shall in fact be held.

                  Once a share is represented at a meeting for any purpose other
than solely to object to holding the meeting or transacting business at the
meeting, it is deemed present for quorum purposes for the remainder of the
meeting and for any adjournment thereof, unless a new record date is or must be
set for that adjourned meeting.

                  An amendment to the Articles of Incorporation, adding,
changing or reducing a quorum for a voting group greater or lesser than the
simple majority specified above, or adding, changing or reducing a voting
requirement from a simple majority shall be governed by RCW 23B.07.270.

                  Section 6. ADJOURNMENTS. Any business which might be
transacted at an annual meeting of the shareholders may be done at a special or
at an adjourned meeting. If no quorum be present at any meeting of the
stockholders (whether annual, special or adjourned) such meeting may be
adjourned by those present from day to day, or from time to time, until such
quorum be obtained, such adjournment and the reasons therefor being recorded in
the journal or minutes of proceedings of the stockholders, and no notice
whatsoever need be given of any such adjourned meeting if the time and place of
such meeting be fixed at the meeting adjourned.

                  Section 7. CONFERENCE TELEPHONE CALLS. Shareholders may
participate in a meeting of shareholders by means of a conference telephone call
or similar



communication equipment by means of which all persons participating in the
meeting can hear each other at the same time, and participation by such means
shall constitute presence in person at a meeting.

                                   ARTICLE VI
                                     SHARES

                  Section 1. CLASS. The shares of this corporation shall consist
of such classes as may be authorized by the Articles of Incorporation as they
may be amended from time to time.

                  Section 2. CERTIFICATES. The shares of the corporation shall
be represented by certificates prepared by the Board of Directors and signed by
two officers of the corporation, unless the corporation has only one officer, in
which case certificates for shares shall be signed by said officer. Each
certificate shall be sealed with the seal of the corporation or a facsimile
thereof, if any. The certificates shall be numbered consecutively and in the
order in which they are issued; and a share register shall be maintained in
which shall be entered the name of the person to whom the shares represented by
each certificate are issued, the number and class or series of such shares, and
the date of issue. Each certificate shall state upon the face thereof (i) that
the corporation is organized under the laws of the state of incorporation, (ii)
the name of the person to whom issued, (iii) the number and class of the shares,
and the designation of the series, if any.

                  Section 3. SUBSCRIPTIONS. Subscriptions to the shares shall be
paid at such times and in such installments as the Board of Directors may
determine. If default be made in the payment of any installment as required by
such resolution, the Board may declare the shares and all previous payments
thereon forfeited for the use of the corporation, if such payment remains in
default twenty (20) days after written notice of the default has been sent to
the subscriber, or in such other manner prescribed by law.

                  Section 4. SHARE OPTIONS. The corporation may issue rights,
options or warrants for the purchase of shares of the corporation. The Board of
Directors shall determine the terms upon which the rights, options, or warrants
are issued, their form and content, and the consideration for which the shares
are to be issued.

                  Section 5. RESTRICTION ON TRANSFER OF SHARES OR OTHER
SECURITIES.

                           (a) The Articles of Incorporation, an agreement among
                  shareholders, or an agreement between shareholders and the
                  corporation may impose restrictions on the transfer or
                  registration of transfer of shares. The restriction does not
                  affect shares issued before the restriction was adopted unless
                  the holders of the shares are parties to the restriction
                  agreement or voted in favor of the restriction.

                           (b) A restriction on the transfer or registration of
                  transfer of shares is valid and enforceable against the holder
                  or a transferee of the holder if the restriction is authorized
                  and its existence is noted conspicuously on the front or




                  back of the certificate or is contained in the information
                  statement. Unless so noted, a restriction is not enforceable
                  against a person without knowledge of the restriction.

                           (c) A restriction on the transfer or registration of
                  transfer of shares is authorized:

                                    (1) to maintain the corporation's status
                           when it is dependent on the number or identity of its
                           shareholders;

                                    (2) to preserve exemptions under federal or
                           state securities law; or

                                    (3) for any other reasonable purpose.

                           (d) A restriction on the transfer or registration of
                  transfer of shares may:

                                    (1) obligate the shareholder first to offer
                           the corporation or other persons (separately,
                           consecutively, or simultaneously) an opportunity to
                           acquire the restricted shares;

                                    (2) obligate the corporation or other
                           persons (separately, consecutively, or
                           simultaneously) to acquire the restricted shares;

                                    (3) require the corporation, the holders of
                           any class of its shares, or another person to approve
                           the transfer of the restricted shares, if the
                           requirement is not manifestly unreasonable; or

                                    (4) prohibit the transfer of the restricted
                           shares to designated persons or classes of persons,
                           if the prohibition is not manifestly unreasonable.

                  Section 6. RETURNED CERTIFICATES. All certificates for shares
changed or returned to the corporation for transfer shall be marked by the
Secretary "Cancelled" with the date of cancellation; and the transaction shall
be immediately recorded in the transfer book opposite the memorandum of their
issue. The returned certificates shall be retained by the corporation and filed
with the stock register.

                  Section 7. LOST CERTIFICATES. Any person claiming a
certificate for shares to be lost or destroyed shall make an affidavit or an
affirmation of the fact and shall advertise the same in such manner as the Board
of Directors may determine; and, if the directors require, shall give the
corporation a bond of indemnity in form and with sureties satisfactory to the
Board, in an amount to be fixed by the Board whereupon a new certificate may be
issued of the same tenor and for the same number of shares as the certificate
alleged to be lost or destroyed.





                                  ARTICLE VII
                                BOOKS AND RECORDS

                  Section 1. This corporation shall keep as permanent records
minutes of all meetings of its shareholders and board of directors, a record of
all actions taken by the shareholders or board of directors without a meeting,
and a record of all actions taken by a committee of the board of directors
exercising the authority of the board of directors on behalf of the corporation.

                  Section 2. This corporation shall maintain appropriate
accounting records.

                  Section 3. This corporation or its agent shall maintain a
record of its shareholders, in a form that permits preparation of a list of the
names and addresses of all shareholders, in alphabetical order by class of
shares showing the number and class of shares held by each.

                  Section 4. This corporation shall maintain its records in
written form or in another form capable of conversion into written form within a
reasonable time.

                  Section 5. The corporation shall keep a copy of the following
records at its principal office:

                           (a) its articles or restated articles of
                  incorporation and all amendments to them currently in effect;

                           (b) its bylaws or restated bylaws and all amendments
                  to them currently in effect;

                           (c) the minutes of all shareholders' meetings, and
                  records of all action taken by shareholders' without a
                  meeting, for the past three years;

                           (d) the financial statements prepared pursuant to RCW
                  23B. 16.200, for the past three years;

                           (e) all written communications to shareholders
                  generally within the past three years;

                           (f) a list of the names and business addresses of its
                  current directors and officers; and

                           (g) its most recent annual report delivered to the
                  secretary of state.

                                  ARTICLE VIII
                                   AMENDMENTS

                  These By-Laws may be altered or repealed and By-Laws may be
made at any annual meeting of the stockholders or at any special meeting thereof
if notice of the proposed alteration or repeal or By-Law or By-Laws to be made
be contained in the notice of such special






meeting, by the affirmative vote of a majority of the stock issued and
outstanding and entitled to vote thereat, or by the affirmative vote of a
majority of the Board of Directors, at any regular or special meeting of the
Board of Directors.

                                   ARTICLE IX
                            MISCELLANEOUS PROVISIONS

                  Section 1. INSTRUMENTS IN WRITING. Notwithstanding any other
provision hereof, all checks, drafts and demands for money of the corporation
shall be signed by such officer or officers, agent or agents, as the Board of
Directors may from time to time by resolution designate. No officer, agent or
employee of the corporation shall have the power to bind the corporation by
contract or otherwise unless authorized to do so by the Board of Directors.

                  Section 2. FISCAL YEAR. The fiscal year of this corporation
shall be set by resolution of the Board of Directors. The initial fiscal year
shall be the calendar year.

                                   ARTICLE X
                                 INFORMAL ACTION

                  Any action required or allowed to be taken at a meeting of the
Board of Directors or the stockholders, as the case may be, may be taken without
a meeting, if a written consent to, or declaration of, such action is signed by
all of the Directors or stockholders, as the case may be.

                  KNOW ALL MEN BY THESE PRESENTS: That we, the undersigned,
being the Board of Directors of Fir Lane Terrace Convalescent Center, Inc., a
Washington corporation, organized and existing under the laws of the State of
Washington, do hereby certify that the foregoing code of Bylaws was duly adopted
by resolution of the Board of Directors of the corporation on the 17th day of
October, 1979.



                                        ___________________________________
                                        Marvin H. Goodwin, Director


                                        ___________________________________
                                        Roberta L. Goodwin, Director

EX-3.49

                                                                    EXHIBIT 3.49


                            ARTICLES OF ORGANIZATION
                                       FOR
                        FLORIDA LIMITED LIABILITY COMPANY

                                   ARTICLE I.
                                      NAME

                  The name of the Limited Liability Company is: First Coast
Health & Rehabilitation Center, LLC.

                                   ARTICLE II.
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee, WI
53203

                                  ARTICLE III.
                     REGISTERED AGENT, REGISTERED OFFICE, &
                          REGISTERED AGENT'S SIGNATURE

      The name and the Florida street address of the registered agent are:


                          Lexis Document Services, Inc.
                               3953 WW Kelley Road
                              Tallahassee, FL 32311

EX-3.50

                                                                    EXHIBIT 3.50

                                STATE of DELAWARE
                            LIMITED LIABILITY COMPANY
                            CERTIFICATE of FORMATION


First: The name of the limited liability company is Fiscal Services Group, LLC.

Second: The address of its registered office in the State of Delaware is 30 Old
Rudnick Lane, Suite 100 in the City of Dover, County of Kent. The name of its
Registered Agent at such address is Lexis Document Services, Inc.

Third: None.

Fourth: None.

EX-3.51

                                                                    EXHIBIT 3.51



                            ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


                  The undersigned, desiring to form a limited liability Company,
under Chapter 1705 of the Ohio Revised Code, do hereby state the following:

                  FIRST: The name of said limited liability company shall be:
Gallipolis Care, LLC.

                  SECOND: This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD: The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.52

                                                                    EXHIBIT 3.52


                            ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


                  The undersigned, desiring to form a limited liability Company,
under Chapter 1705 of the Ohio Revised Code, do hereby state the following:

                  FIRST: The name of said limited liability company shall be:
Great Trail Care, LLC.

                  SECOND: This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD: The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.53

                                                                    EXHIBIT 3.53



                            ARTICLES OF ORGANIZATION
                                       FOR
                        FLORIDA LIMITED LIABILITY COMPANY

                                   ARTICLE I.
                                      NAME

       The name of the Limited Liability Company is: Greenbriar Care, LLC.


                                  ARTICLE II.
                                    ADDRESS

  The mailing address and street address of the principal office of the Limited
Liability Company is: 111 West Michigan Street, Milwaukee, WI 53203


                                  ARTICLE III.
                     REGISTERED AGENT, REGISTERED OFFICE, &
                          REGISTERED AGENT'S SIGNATURE

      The name and the Florida street address of the registered agent are:


                          Lexis Document Services, Inc.
                               3953 WW Kelley Road
                              Tallahassee, FL 32311

EX-3.54

                                                                    EXHIBIT 3.54


                            ARTICLES OF ORGANIZATION
                                       FOR
                        FLORIDA LIMITED LIABILITY COMPANY

                                   ARTICLE I.
                                      NAME

                  The name of the Limited Liability Company is: Greenbrook Care,
LLC.

                                   ARTICLE II.
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee, WI
53203

                                  ARTICLE III.
                     REGISTERED AGENT, REGISTERED OFFICE, &
                          REGISTERED AGENT'S SIGNATURE

                  The name and the Florida street address of the registered
agent are:

                          Lexis Document Services, Inc.
                               3953 WW Kelley Road
                              Tallahassee, FL 32311

EX-3.55

                                                                    EXHIBIT 3.55


                       CERTIFICATE OF LIMITED PARTNERSHIP

         In compliance with the requirements of the Delaware Limited Partnership
Act, Title 6, Chapter 17 of the Delaware Code (relating to certificate of
limited partnership), the undersigned, desiring to form a limited partnership,
hereby certifies that:

1.       The name of the limited partnership is:     Haven Care, LP

2.       The address of this limited partnership's initial registered office is:


         111 West Michigan Street,       Milwaukee,       WI              53203              Milwaukee
         -------------------------------------------------------------------------------------------------
            Number and Street              City          State             Zip                County



3.       The address of this limited partnership's registered agent upon whom
         process may be served is:


         Lexis Document Services Inc.
         30 Old Rudnick Lane, Suite 100,      Dover,        DE            19901             Kent
         --------------------------------------------------------------------------------------------------
             Number and Street                City         State           Zip            County



4.       The name and business address of each general partner of the
         partnership is:


         Name                               Address

         Coventry Care Holdings, Inc.       111 West Michigan Street, Milwaukee, WI  53203




5.       The formation of the limited partnership shall be effective upon filing
         this Certificate of Limited Partnership with the Office of the
         Secretary of State.

EX-3.56

                                                                    EXHIBIT 3.56

                                    ARTICLES

                                       OF

                                  INCORPORATION

                  In compliance with the requirements of the Business
Corporation Law, approved the 5th day of May, A. D. 1933, P. L. 364, as amended,
the undersigned, desiring that they may be incorporated as a business
corporation, do hereby certify:

                  1. The name of the corporation is HAVEN CREST, INC.

                  2. The location and post office address of its initial
registered office in this Commonwealth is:


      1277 Country Club Road        Monongahela           Washington
      ----------------------        -----------           ----------
              Number                   City                County


                  3. The purpose or purposes of the corporation are:

                  To purchase land and buildings and to build and construct
buildings and facilities for the purposes of establishing and operating a Home
for the Aged and other sick and convalescing Persons for nursing, convalescent,
retirement, and medial care and services for the above named patients. Rates,
medical and nursing care and services will be in compliance with local, state
and federal laws and regulations.

                  4. The term of its existence is Perpetual.

                  5. The aggregate number of shares which the corporation shall
have authority to issue is:

                  4,000 Shares of the Common Voting Stock, Par Value 5.00

                  40,000 Shares of the Class A Common Stock, Par Value 5.00

                  "which shall, except or otherwise required by law be without
                  voting rights."

                  6. The names and addresses of each of the first directors are:

          NAME                                           ADDRESS
                                           (Including street and number, if any)

       Armand Caputo                          379 Pearl St., Brownsville, PA
    Dr. Michael Vaccaro                        Third Street, Monongahela, PA
    Dr. A.M. Hofstetter                       206 Ridge Ave., Belle Vernon, PA


                  7. The names and address of each of the incorporators and the
number and class of shares subscribed by each are:







                                              ADDRESS                             NUMBER AND CLASS
        NAME                   (INCLUDING STREET AND NUMBER, IF ANY)                  OF SHARES
                                                                           
   Armand Caputo                   379 Pearl St., Brownsville, PA                1334 Common Voting
Dr. Michael Vaccaro                Third Street, Monongahela, PA                 1333 Common Voting
Dr. A.M. Hofstetter               206 Ridge Ave., Belle Vernon, PA               1333 Common Voting



                                       2

EX-3.57

                                                                    EXHIBIT 3.57


                                     BYLAWS
                                       OF
                               HAVEN CREST, INC.


                                    ARTICLE I
                                     OFFICES

                  Section 1. The registered office of the corporation shall be
at 1277 Country Club Road, Monongahela, Pennsylvania.

                  Section 2. The corporation may also have offices at such other
places as the Board of Directors may from time to time appoint or the business
of the corporation may require.

                                   ARTICLE II
                                      SEAL

                  Section 1. The corporate seal shall have inscribed thereon the
name of the corporation, the year of its organization and the words "Corporate
Seal, Pennsylvania".

                                   ARTICLE III
                              SHAREHOLDERS' MEETING

                  Section 1. Meetings of the shareholders shall be held at
office of the corporation at 1277 Country Club Road, Monongahela, Pennsylvania
or at such other place or places, either within or without the Commonwealth of
Pennsylvania, as may from time to time be selected.

                  Section 2. The annual meeting of the shareholders, shall be
the fourth week of March per Shareholder Action dated December 1, 1994. They
shall elect a Board of Directors, and transact such other business as may
properly be brought before the meeting. If the annual meeting the annual meeting
shall not be called and held within six months after the designated time, any
shareholder may call such meeting.

                  Section 3. The presence, in person or by proxy, of the holders
of a majority of the outstanding shares entitled to vote shall constitute a
quorum at all meetings of the shareholders except as otherwise provided by law,
by Articles of Incorporation or by these By-Laws. If however, such quorum shall
not be present at any meeting of the shareholders, those entitled to vote
thereat shall have power to adjourn the meeting from time to time, without
notice other than announcement at the meeting, until the requisite number of
shares shall be present. In the case of any meeting called for the election of
directors, adjournment or adjournments may be taken only from day to day, or for
such longer periods not exceeding fifteen days each, as the holders of a
majority of the shares present in person or by proxy shall direct, until such
directors have been elected, and those who attend the second of such adjourned
meetings, although less than a quorum, shall nevertheless constitute a quorum
for the purpose of electing directors.

                  Section 4. At each meeting of the shareholders every
shareholder having the right to vote shall be entitled to vote in person or by
proxy appointed by an instrument in writing


subscribed by such shareholder and delivered to the Secretary at the meeting. No
unrevoked proxy shall be valid after eleven months from the date of its
execution, unless a longer time is expressly provided therein, but in no event
shall a proxy, unless coupled with an interest, be voted on after three years
from the date of its execution. In all elections for directors cumulative voting
shall be allowed. Upon demand made by a shareholder at any election for
directors before the voting begins, the election shall be by ballot. No share
shall be voted at any meeting upon which any installment is due and unpaid. The
original share ledger or transfer book, or a duplicate thereof kept in this
Commonwealth shall be prima facie evidence of the right of the person named
therein to vote thereon.

                  Section 5. Written notice of the annual meeting shall be
mailed to each shareholder entitled to vote thereat, at such address as appears
on the books of the corporation, at least ______ days prior to the meeting.

                  Section 6. In advance of any meeting of shareholders, the
Board of Directors may appoint judges of election, who need not be shareholders,
to act at such meeting or any adjournment thereof. If judges of election be not
so appointed, the chairman of any such meeting may, and on the request of any
shareholder or his proxy, shall make such appointment at the meeting. The number
of judges shall be one or three. If appointed at a meeting on the request of one
or more shareholders or proxies, the majority of shares present and entitled to
vote shall determine whether one or three judges are to be appointed. On request
of the chairman of the meeting, or of any shareholder or his proxy, the judges
shall make a report in writing of any challenge or question or matter determined
by them, and execute a certificate of any fact found by them. No person who is a
candidate for office shall act as a judge.

                  Section 7. Special meetings of the shareholders may be called
at any time by the President, or the Board of Directors, or the holders of not
less than one-fifth of all the shares outstanding and entitled to vote. At any
time, upon written request of any person entitled to call a special meeting, it
shall be the duty of the Secretary to call a special meeting of the
shareholders, to be held at such time as the Secretary may fix, not less than
ten nor more than sixty days after receipt of the request.

                  Section 8. Business transacted at all special meetings shall
be confined to the objects stated in the call and matters germane thereto.

                  Section 9. Written notice of a special meeting of shareholders
stating the time and place and object thereof, shall be mailed, postage prepaid,
to each shareholder entitled to vote thereat at such address as appears on the
books of the corporation, at least seven days before such meeting, unless a
greater period of notice is required by statute in a particular case.

                  Section 10. The officer or agent having charge of the transfer
books shall make at least five days before each meeting of shareholders, a
complete list of the shareholders entitled to vote at the meeting, arranged in
alphabetical order, with the address of and the number of shares held by each,
which list shall be subject to inspection by any shareholder at any time during
usual business hours. Such list shall also be produced and kept open at the time
and place of the meeting, and shall be subject to the inspection of any
shareholder during the whole time of the meeting. The original share ledger or
transfer book, or a duplicate thereof kept in this


Commonwealth, shall be prima facie evidence as to who are the shareholders
entitled to examine such list or share ledger or transfer book, or to vote in
person or by proxy, at any meeting of shareholders.

                                   ARTICLE IV
                                    DIRECTORS

                  Section 1. The number of authorized Directors of the
Corporation shall be not less than 1 nor more than 15, fixed from time to time
by the Shareholder. The Directors shall be elected at the annual meeting of the
Shareholders and each Director shall be elected to serve until his successor
shall be elected and shall qualify.

                  Section 2. In addition to the powers and authorities by these
By-Laws expressly conferred upon them, the Board may exercise all such powers of
the corporation and do all such lawful acts and things as are not by statute or
by the Articles or by these By-Laws directed or required to be exercised or done
by the shareholders.

                  Section 3. The meetings of the Board of Directors may be held
at such place within this Commonwealth, or elsewhere, as a majority of the
directors may from time to time appoint, or as may be designated in the notice
calling the meeting.

                  Section 4. Each newly elected Board may meet at such place and
time as shall be fixed by the shareholders at the meeting at which such
directors are elected and no notice shall be necessary to the newly elected
directors in order legally to constitute the meeting, or they may meet at such
place and time as may be fixed by the consent in writing of all the directors.

                  Section 5. Regular meetings of the Board shall be held without
notice on the third Wednesday of January, April, July and October each year at
2:00 p.m. at the registered office of the company, or at such other time and
place as shall be determined by the Board.

                  Section 6. Special meetings of the Board may be called by the
President on three-days' notice to each director, either personally or by mail
or by telegram; special meetings shall be called by the President or Secretary
in like manner and on like notice on the written request of two directors.

                  Section 7. A majority of the directors in office shall be
necessary to constitute a quorum for the transaction of business, and the acts
of a majority of the directors present at a meeting at which a quorum is present
shall be the acts of the Board of Directors. If all the directors shall
severally or collectively consent in writing to any action to be taken by the
corporation, such action shall be as valid corporate action as though it had
been authorized at a meeting of the Board of Directors.

                  Section 8. Directors as such, shall not receive any stated
salary for their services, but by resolution of the Board, a fixed sum and
expenses of attendance, if any, may be allowed for attendance at each regular or
special meeting of the Board PROVIDED, that nothing herein contained shall be
construed to preclude any director from serving the corporation in any other
capacity and receiving compensation therefor.




                                    ARTICLE V
                                    OFFICERS

                  Section 1. The executive officers of the corporation shall be
chosen by the directors and shall be a President, Secretary, and Treasurer. The
Board of Directors may also choose a Vice-President and such other officers and
agents as it shall deem necessary, who shall hold their offices for such terms
and shall have such authority and shall perform such duties as from time to time
shall be prescribed by the Board. Any two or more offices may be held by the
same person, except the offices of President and Secretary. It shall not be
necessary for the officers to be directors.

                  Section 2. The salaries of all officers and agents of the
corporation shall be fixed by the Board of Directors.

                  Section 3. The officers of the corporation shall hold office
for one year and until their successors are chosen and have qualified. Any
officer elected or appointed by the Board of Directors may be removed by the
Board of Directors whenever in their judgment the best interests of the
corporation will be served thereby.

                  Section 4. The President shall be the chief executive officer
of the corporation; he shall preside at all meetings of the shareholders and
directors; he shall have general and active management of the business of the
corporation, shall see that all orders and resolutions of the Board are carried
into effect, subject, however, to the right of the directors to delegate any
specific powers, except such as may be by statute exclusively conferred on the
President, to any other officer or officers of the corporation. He shall execute
bonds, mortgages and other contracts requiring a seal, under the seal of the
corporation. He shall be EX-OFFICIO a member of all committees, and shall have
the general powers and duties of supervision and management usually vested in
the office of President of a corporation.

                  Section 5. The Secretary shall attend all sessions of the
Board and all meetings of the shareholders and act as clerk thereof, and record
all the votes of the corporation and the minutes of all its transactions in a
book to be kept for that purpose; and shall perform like duties for all
committees of the Board of Directors when required. He shall give, or cause to
be given, notice of all meetings of the shareholders and of the Board of
Directors, and shall perform such other duties as may be prescribed by the Board
of Directors or President, and under whose supervision he shall be. He shall
keep in safe custody the corporate seal of the corporation, and when authorized
by the Board, affix the same to any instrument requiring it.

                  Section 6. The Treasurer shall have custody of the corporate
funds and securities and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the corporation, and shall keep the moneys
of the corporation in a separate account to the credit of the corporation. He
shall disburse the funds of the corporation as may be ordered by the Board,
taking proper vouchers for such disbursements, and shall render to the President
and Directors, at the regular meetings of the Board, or whenever they may
require it, an account of all his transactions as Treasurer and of the financial
condition of the corporation.




                                   ARTICLE VI
                                    VACANCIES

                  Section 1. If the office of any officer or agent, one or more,
becomes vacant for any reason, the Board of Directors may choose a successor or
successors, who shall hold office for the unexpired term in respect of which
such vacancy occurred.

                  Section 2. Vacancies in the Board of Directors shall be filled
by a majority of the remaining members of the Board though less than a quorum,
and each person so elected shall be a director until his successor is elected by
the shareholders, who may make such election at the next annual meeting of the
shareholders or at any special meeting duly called for that purpose and held
prior thereto.

                                   ARTICLE VII
                                CORPORATE RECORDS

                  Section 1. There shall be kept at the registered office of the
corporation an original or duplicate record of the proceedings of the
shareholders and of the directors, and the original or a copy of its By-Laws,
including all amendments or alterations thereto to date, certified by the
Secretary of the corporation. An original or duplicate share register shall also
be kept at the registered office, or at the office of a transfer agent or
registrar within this Commonwealth, giving the names of the shareholders in
alphabetical order, and showing their respective addresses, the number and
classes of shares held by each, the number and date of certificates issued for
the shares, and the number and date of cancellation of every certificate
surrendered for cancellation.

                  Section 2. Every shareholder shall have a right to examine, in
person or by agent or attorney, at any reasonable time or times, for any
reasonable purpose, the share register, books or records of account, and records
of the proceedings of the shareholders and directors, and make extracts
therefrom.

                                  ARTICLE VIII
                       SHARE CERTIFICATES, DIVIDENDS, ETC.

                  Section 1. The share certificates of the corporation shall be
numbered and registered in the share ledger and transfer books of the
corporation, as they are issued. They shall be signed by the President and
Secretary-Treasurer and shall bear the corporate seal.

                  Section 2. Transfers of shares shall be made on the books of
the corporation upon surrender of the certificates thereof or, endorsed by the
person named in the certificate or by attorney, lawfully constituted in writing.
No transfer shall be made inconsistent with the provisions of Article 8 of the
Uniform Commercial Code, approved the sixth day of April, one thousand nine
hundred fifty-three (Act No. 1), and its amendments and supplements.

                  Section 3. The Board of Directors may fix a time, not more
than fifty days, prior to the date of any meeting of shareholders, or the date
fixed for the payment of any dividend or distribution, or the date for the
allotment of rights, or the date when any change or conversion or exchange of
shares will be made or go into effect, as a record date for the


determination of the shareholders entitled to notice of, or to vote at, any such
meeting, or entitled to receive payment of any such dividend or distribution, or
to receive any such allotment of rights, or to exercise the rights in respect to
any such change, conversion, or exchange of shares. In such case, only such
shareholders as shall be shareholders of record on the date so fixed shall be
entitled to notice of, or to vote at, such meeting, or to receive payment of
such dividend, or to receive such allotment of rights, or to exercise such
rights as the case may be, notwithstanding any transfer of any shares on the
books of the corporation after any record date fixed, as aforesaid. The Board of
Directors may close the books of the corporation against transfers of shares
during the whole or any part of such period, and in such case, written or
printed notice thereof shall be mailed at least ten days before the closing
thereof to each shareholder of record at the address appearing on the records of
the corporation or supplied by him to the corporation for the purpose of notice.
While the stock transfer books of the corporation are closed, no transfer of
shares shall be made thereon. If no record date is fixed for the determination
of shareholders entitled to receive notice of, or vote at, a shareholders'
meeting, transferees of shares which are transferred on the books of the
corporation within ten days next preceding the date of such meeting shall not be
entitled to notice of or vote at such meeting.

                  Section 4. Any person claiming a share certificate to be lost
or destroyed shall make an affidavit or affirmation of that fact and advertise
the same in such manner as the Board of Directors may require, and shall give
the corporation a bond of indemnity with sufficient surety to protect the
corporation or any person injured by the issue of a new certificate from any
liability or expense which it or they may incur by reason of the original
certificate remaining outstanding, whereupon a new certificate may be issued of
the same tenor and for the same number of shares as the one alleged to be lost
or destroyed, but always subject to the approval of the Board of Directors.

                  Section 5. Subject to the provisions of the statutes, the
Board of Directors may declare and pay dividends upon the outstanding shares of
the corporation out of its surplus from time to time and to such extent as they
deem advisable, in cash, property or in shares of the corporation.

                  Section 6. Before payment of any dividend there may be set
aside out of the net profits of the corporation such sum or sums as the
directors, from time to time, in their absolute discretion, think proper as a
reserve fund to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the corporation, or for such other
purpose as the directors shall think conducive to the interests of the
corporation, and the directors may abolish any such reserve in the manner in
which it was created.

                                   ARTICLE IX
                            MISCELLANEOUS PROVISIONS

                  Section 1. All checks or demands for money and notes of the
corporation shall be signed by such officer or officers as the Board of
Directors may from time to time designate.

                  Section 2. The fiscal year shall begin the 1st day of January
each year.




                  Section 3. Whenever written notice is required to be given to
any person, it may be given to such person, either personally or by sending a
copy thereof through the mail, or by telegram, charges prepaid, to his address
appearing on the books of the corporation, or supplied by him to the corporation
f or the purpose of notice. If the notice is sent by mail or by telegraph, it
shall be deemed to have been given to the person entitled thereto when deposited
in the United States mail or with a telegraph office for transmission to such
person. Such notice shall specify the place, day and hour of the meeting and, in
the case of a special meeting, the general nature of the business to be
transacted.

                  Section 4. Whenever any written notice is required by statute,
or by the Articles or By-Laws of this corporation, a waiver thereof in writing,
signed by the person or persons entitled to such notice, whether before or after
the time stated therein, shall be deemed equivalent to the giving of such
notice. Except in the case of a special meeting, neither the business to be
transacted at nor the purpose of the meeting need be specified in the waiver of
notice of such meeting. Attendance of a person, either in person or by proxy, at
a meeting shall constitute a waiver of notice of such meeting, except where a
person attends a meeting for the express purpose of objecting to the transaction
of any business because the meeting was not lawfully called or convened.

                  Section 5. No shares of the capital stock of the corporation
shall be assigned or transferred by the holder thereof or his heirs, executors,
administrators, or assigns to any person, firm or corporation unless and until
written notice of the intended transfer shall have been given to all other
shareholders and an opportunity shall have first been afforded to any or all
shareholders to purchase said shares within thirty days from date of receipt of
said notice at a price equivalent to book value of such shares on the last
annual statement date or the market value that a bona fide purchaser will pay
for the shares, whichever is the larger of the two.

                  The book value shall be as determined by the accountants
designated from time to time by the Board of Directors to audit the books of the
corporation and to report thereon.

                  Within thirty days of receipt of such notice of an intended
sale, the other shareholders shall have the right to purchase said stock in an
amount proportionate to the number of shares held by these shareholders electing
to purchase said shares purpose of the meeting need be specified in the waiver
of notice of such meeting. Attendance of a person, either in person or by proxy,
at any meeting shall constitute a waiver of notice of such meeting, except where
a person attends a meeting for the express purpose of objecting to the
transaction of any business because the meeting was not lawfully called or
convened.

                                    ARTICLE X
                                ANNUAL STATEMENT

                  Section 1. The President and Board of Directors shall present
at each annual meeting a full and complete statement of the business and affairs
of the corporation for the preceding year. Such statement shall be prepared and
presented in whatever manner the Board of Directors shall deem advisable and
need not be verified by a certified public accountant.




                                   ARTICLE XI
                                   AMENDMENTS

                  Section 1. These By-Laws may be altered or repealed and
By-Laws may be made at any annual meeting of the stockholders or at any special
meeting thereof if notice of the proposed alteration or repeal or By-Law or
By-Laws to be made be contained in the notice of such special meeting, by the
affirmative vote of a majority of the stock issued and outstanding and entitled
to vote thereat, or by the affirmative vote of a majority of the Board of
Directors, at any regular or special meeting of the Board of Directors.

EX-3.58

                                                                    EXHIBIT 3.58



                           ARTICLES OF INCORPORATION

Indicated type of domestic corporation (check one):


__X__        Business-stock (15 Pa. C.S. ss. 1306)         _____      Professional (15 Pa. C.S. ss. 2903)
_____        Business-nonstock (15 Pa. C.S. ss. 2102)      _____      Management (15 Pa. C.S. ss. 2701)
_____        Business-statutory close (15 Pa. C.S. ss.     _____      Cooperative (15 Pa. C.S. ss. 7701)
             2304a is applicable)



1.       The name of the corporation is HEALTH POCONOS, INC. This corporation is
         incorporated under the provisions of the Business Corporation Law of
         1988.

2.       The (a) address of this corporation's initial registered office in this
         Commonwealth of (b) commercial registered office provider and the
         county of venue is:

(a)      4 Fork Street, Mt. Pocono, Pa, 18344, Luzerne County.

(b)

         --------------------------------------------------      ---------------
         Name of Commercial Registered Officer Provider          County


         For a corporation represented by a commercial registered office
         provider, the county in (b) shall be the county in which the
         corporation is located for venue and official publication purposes.

3.       The aggregate number of shares authorized is 500

4.       The name and address, including street and number, if any, of each
         incorporator is:


NAME                          ADDRESS                                      SIGNATURE                DATE
Sharon O'Donnell              401 Third Avenue, Kingston, PA 18704         /s/ Sharon O'Donnell     6/11/91
                                                                           --------------------


5.       The specified effective date, if any, is:  Upon filing of Articles.

6.       The Board of Directors shall have the authority to divide the
         authorized and unissued shares into classes or series, or both, and to
         determine for any such class or series its voting rights, designations,
         preferences, limitations and special rights.

EX-3.59

                                                                    EXHIBIT 3.59



                                     BYLAWS
                                       OF
                              HEALTH POCONOS, INC.

                          (a Pennsylvania corporation)

                                   ARTICLE I
                             OFFICES AND FISCAL YEAR

                  Section 1.01 REGISTERED OFFICE. The registered office of the
corporation in Pennsylvania shall be at Fork Street, Mount Pocono, PA until
otherwise established by an amendment of the articles or by the board of
directors and a record of such change is filed with the Department of State in
the manner, provided by law.

                  Section 1.02 OTHER OFFICE. The corporation may also have
offices at such other places within or without Pennsylvania as the board of
directors may from time to time appoint or the business of the corporation may
require.

                  Section 1.03 FISCAL YEAR. The fiscal year of the corporation
shall begin the 1st day of January in each year.

                                   ARTICLE II
                      NOTICE - WAIVERS - MEETINGS GENERALLY

                  Section 2.01 MANNER OF GIVING NOTICE.

                  (a) General rule. Whenever written notice is required to be
given to any person under the provisions of the Business Corporation Law or by
the Articles or these bylaws, it may be given to the person either personally or
by sending a copy thereof by first class or express mail, postage prepaid, or by
telegram (with messenger service specified), telex or TWX (with answerback
received) or courier service, charges prepaid, or by telecopier, to the address
(or to the telex, TWX, telecopier or telephone number) of the person appearing
on the books of the corporation or, in the case of directors, supplied by the
directors to the corporation for the purpose of notice. If the notice is sent by
mail, telegraph or courier service, it shall be deemed to have been given to the
person entitled thereto when deposited in the United States mail or with a
telegraph office or courier service for delivery to that person or, in the case
of telex or TWX, when dispatched or, in the case of telecopier, when received. A
notice of meeting shall specify the place, day and hour of the meeting and any
other information required by any other provision of the Business Corporation
Law, the articles or these bylaws.

                  (b) Adjourned shareholder meetings. When a meeting of
shareholders is adjourned, it shall not be necessary to give any notice of the
adjourned meeting or of the business to be transacted at an adjourned meeting,
other than by announcement at the meeting at which the adjournment is taken,
unless the board fixes a new record date for the adjourned meeting.

                  Section 2.02 NOTICE OF MEETINGS OF BOARD OF DIRECTORS. Notice
of a regular meeting of the board of directors need not be given. Notice of
every special meeting








of the board of directors shall be given to each director by telephone or in
writing at least 24 hours (in the case of notice by telephone, telex, TWX or
telecopier) or 48 hours (in the case of notice by telegraph, courier service or
express mail) or five days (in the case of notice by first class mail) before
the time at which the meeting is to be held. Every such notice shall state the
time and place of the meeting. Neither the business to be transacted at, nor the
purpose of, any regular or special meeting of the board need be specified in a
notice of a meeting.

                  Section 2.03 NOTICE OF MEETINGS OF SHAREHOLDERS.

                  (a) General rule. Written notice of every meeting of the
shareholders shall be given by, or at the direction of, the secretary to each
shareholder of record entitled to vote at the meeting at least:

                      (1) ten days prior to the day named for a meeting called
         to consider a fundamental transaction under 15 Pa.C.S. Chapter 19
         regarding amendments of articles of incorporation, mergers,
         consolidations, share exchanges, sale of assets, divisions,
         conversions, liquidations and dissolution; or

                      (2) five days prior to the day named for the meeting in
         any other case.

If the secretary neglects or refuses to give notice of a meeting, the person or
persons calling the meeting may do so. In the case of a special meeting of
shareholders, the notice shall specify the general nature of the business to be
transacted.

                  (b) Notice of action by shareholders on bylaws. In the case of
a meeting of shareholders that has as one its purposes action on the bylaws,
written notice shall be given to each shareholder that the purpose, or one of
the purposes, of the meeting is to consider the-adoption, amendment or repeal of
the bylaws. There shall be included in, or enclosed with, the notice a copy of
the proposed amendment or a summary of the changes to be effected thereby.

                  Section 2.04 WAIVER OF NOTICE.

                  (a) Written waiver. Whenever any written notice is required to
be given under the provisions of the Business Corporation Law, the articles or
these bylaws, a waiver thereof in writing, signed by the person or persons
entitled to the notice, whether before or after the time stated therein, shall
be deemed equivalent to the giving of the notice. Except as otherwise required
by this subsection, neither the business to be transacted at, nor the purpose
of, a meeting need be specified in the waiver of notice of the meeting. In the
case of a special meeting of shareholders, the waiver of notice shall specify
the general nature of the business to be transacted.

                  (b) Waiver by attendance. Attendance of a person at any
meeting shall constitute a waiver of notice of the meeting except where a person
attends a meeting for the express purpose of objecting, at the beginning of the
meeting, to the transaction of any business because the meeting was not lawfully
called or convened.






                  Section 2.05 MODIFICATION OF PROPOSAL CONTAINED IN NOTICE.
Whenever the language of a proposed resolution is included in a written notice
of a meeting required to be given under the provisions of the Business
Corporation Law or the articles or these bylaws, the meeting considering the
resolution may without further notice adopt it with such clarifying or other
amendments as do not enlarge its original purpose.

                  Section 2.06 EXCEPTION TO REQUIREMENT OF NOTICE.

                  (a) General rule. Whenever any notice or communication is
required to be given to any person under the provisions of the Business
Corporation Law or by the articles or these bylaws or by the terms of any
agreement or other instrument or as a condition precedent to taking any
corporate action and communication with that person is then unlawful, the giving
of the notice or communication to that person shall not be required.

                  (b) Shareholders without forwarding addresses. Notice or other
communications shall not be sent to any shareholder with whom the corporation
has been unable to communicate for more than 24 consecutive months because
communications to the shareholder are returned unclaimed or the shareholder has
otherwise failed to provide the corporation with a current address. Whenever the
shareholder provides the corporation with a current address, the corporation
shall commence sending notices and other communications to the shareholder in
the same manner as to other shareholders.

                  Section 2.07 USE OF CONFERENCE TELEPHONE AND SIMILAR
EQUIPMENT. One or more persons may participate in a meeting of the board of
directors or the shareholders of the corporation by means of conference
telephone or similar communications equipment by means of which all persons
participating in the meeting can hear each other. Participation in a meeting
pursuant to this section shall constitute presence in person at the meeting.

                                   ARTICLE III
                                  SHAREHOLDERS

                  Section 3.01 PLACE OF MEETING. All meetings of the
shareholders of the corporation shall be held at the registered office of the
corporation unless another place is designated by the board of directors in the
notice of a meeting.

                  Section 3.02 ANNUAL MEETING. The board of directors may fix
the date and time of the annual meeting of the shareholders, but if no such date
and time is fixed by the board, the meeting for any calendar year shall be held
on the 30th day of April in such year, if not a legal holiday under the laws of
Pennsylvania, and, if a legal holiday, then on the next succeeding business day,
not a Saturday, at 10:00 o'clock A.M., and at said meeting the shareholders then
entitled to vote shall elect directors and shall transact such other business as
may properly be brought before the meeting. If the annual meeting shall not have
been called and held within six months after the designated time, any
shareholder may call the meeting at any time thereafter.





                  Section 3.03 SPECIAL MEETINGS.

                  (a) Call of special meetings. Special meetings of the
shareholders may be called at any time:

                      (1) by the board of directors; or

                      (2) unless otherwise provided in the articles, by
         shareholders entitled to cast at least 20% of the vote that all
         shareholders are entitled to cast at the particular meeting.

                  (b) Fixing of time for meeting. At any time, upon written
request of any person who has called a special meeting, it shall be the duty of
the secretary to fix the time of the meeting which shall be held not more than
60 days after the receipt of the request. If the secretary neglects or refuses
to fix a time of the meeting, the person or persons calling the meeting may do
so.

                  Section 3.04 QUORUM AND ADJOURNMENT.

                  (a) General rule. A meeting of shareholders of the corporation
duly called shall not be organized for the transaction of business unless a
quorum is present. The presence of shareholders entitled to cast at least a
majority of the votes that all shareholders are entitled to cast on a particular
matter to be acted upon at the meeting shall constitute a quorum for the
purposes of consideration and action on the matter. Shares of the corporation
owned, directly or indirectly, by it and controlled, directly or indirectly, by
the board of directors of this corporation, as such, shall not be counted in
determining the total number of outstanding shares for quorum purposes at any
given time.

                  (b) Withdrawal of a quorum. The shareholders present at a duly
organized meeting can continue to do business until adjournment notwithstanding
the withdrawal of enough shareholders to leave less than a quorum.

                  (c) Adjournment for lack of quorum. If a meeting cannot be
organized because a quorum has not attended, those present may, except as
provided in the Business Corporation Law, adjourn the meeting to such time and
place as they may determine.

                  (d) Adjournments generally. Any meeting at which directors are
to be elected shall be adjourned only from day to day, or for such longer
periods not exceeding 15 days each as the shareholders present and entitled to
vote shall direct, until the directors have been elected. Any other regular or
special meeting may be adjourned for such period as the shareholders present and
entitled to vote shall direct.

                  (e) Electing directors at adjourned meeting. Those
shareholders entitled to vote who attend a meeting called for the election of
directors that has been previously adjourned for lack of a quorum, although less
than a quorum as fixed in this section, shall nevertheless constitute a quorum
for the purpose of electing directors.





                  (f) Other action in absence of quorum. Those shareholders
entitled to vote who attend a meeting of shareholders that has been previously
adjourned for one or more periods aggregating at least 15 days because of an
absence of a quorum, although less than a quorum as fixed in this section, shall
nevertheless constitute a quorum for the purpose of acting upon any matter set
forth in the notice of the meeting if the notice states that those shareholders
who attend the adjourned meeting shall nevertheless constitute a quorum for the
purpose of acting upon the matter.

                  Section 3.05 ACTION BY SHAREHOLDERS.

                  (a) General rule. Except as otherwise provided in the Business
Corporation Law or the articles or these bylaws, whenever any corporate action
is to be taken by vote of the shareholders of the corporation, it shall be
authorized by a majority of the votes cast at a duly organized meeting of
shareholders by the holders of shares entitled to vote thereon.

                  (b) Interested shareholders. Any merger or other transaction
authorized under 15 Pa.C.S. Subchapter 19C between the corporation or subsidiary
thereof and a shareholder of this corporation, or any voluntary liquidation
authorized under 15 Pa.C.S. Subchapter 19F in which a shareholder is treated
differently from other shareholders of the same class (other than any dissenting
shareholders), shall require the affirmative vote of the shareholders entitled
to cast at least a majority of the votes that all shareholders other than the
interested shareholder are entitled to cast with respect to the transaction,
without counting the vote of the interested shareholder. For the purposes of the
preceding sentence, interested shareholder shall include the shareholder who is
a party to the transaction or who is treated differently from other shareholders
and any person, or group of persons, that is acting jointly or in concert with
the interested shareholder and any person who, directly or indirectly, controls,
is controlled by or is under common control with the interested shareholder. An
interested shareholder shall not include any person who, in good faith and not
for the purpose of circumventing this subsection, is an agent, bank, broker,
nominee or trustee for one or more other persons, to the extent that the other
person or persons are not interested shareholders.

                  (c) Exceptions. Subsection (b) shall not apply to a
transaction:
                      (1) that has been approved by a majority vote of the board
         of directors without counting the vote of directors who:

                          (i) are directors or officers of, or have a material
                  equity interest in, the interested shareholder; or

                          (ii) were nominated for election as a director by the
                  interested shareholder, and first elected as a director,
                  within 24 months of the date of the vote on the proposed
                  transaction; or

                      (2) in which the consideration to be received by the
         shareholders for shares of any class of which shares are owned by the
         interested shareholder is not less than the highest amount paid by the
         interested shareholder in acquiring shares of the same class.





                  (d) Additional approvals. The approvals required by subsection
(b) shall be in addition to, and not in lieu of, any other approval required by
the Business Corporation Law, the articles or these bylaws, or otherwise.

                  Section 3.06 ORGANIZATION. At every meeting of the
shareholders, the chairman of the board, if there be one, or, in the case of
vacancy in office or absence of the chairman of the board, one of the following
officers present in the order stated: the vice chairman of the board, if there
be one, the president, the vice presidents in their order of rank and seniority,
or a person chosen by vote of the shareholders present, shall act as chairman of
the meeting. The secretary or, in the absence of the secretary, an assistant
secretary, or in the absence of both the secretary and assistant secretaries, a
person appointed by the chairman of the meeting, shall act as secretary.

                  Section 3.07 VOTING RIGHTS OF SHAREHOLDERS. Unless otherwise
provided in the articles, every shareholder of the corporation shall be entitled
to one vote for every share standing in the name of the shareholder on the books
of the corporation.

                  Section 3.08 VOTING AND OTHER ACTION BY PROXY.

                  (a) General rule.

                      (1) Every shareholder entitled to vote at a meeting of
         shareholders or to express consent or dissent to corporate action in
         writing without a meeting may authorize another person to act for the
         shareholder by proxy.

                      (2) The presence of, or vote or other action at a meeting
         of shareholders, or the expression of consent or dissent to corporate
         action in writing, by a proxy of a shareholder shall constitute the
         presence of, or vote or action by, or written consent or dissent of the
         shareholder.

                      (3) Where two or more proxies of a shareholder are
         present, the corporation shall, unless otherwise expressly provided in
         the proxy, accept as the vote of all shares represented thereby the
         vote cast by a majority of them and, if a majority of the proxies
         cannot agree whether the shares represented shall be voted or upon the
         manner of voting the shares, the voting of the shares shall be divided
         equally among those persons.

                  (b) Minimum requirements. Every proxy shall be executed in
writing by the shareholder or by the duly authorized attorney-in-fact of the
shareholder and filed with the secretary of the corporation. A proxy, unless
coupled with an interest, shall be revocable at will, notwithstanding any other
agreement or any provision in the proxy to the contrary, but the revocation of a
proxy shall not be effective until written notice thereof has been given to the
secretary of the corporation. An unrevoked proxy shall not be valid after three
years from the date of its execution unless a longer time is expressly provided
therein. A proxy shall not be revoked by the death or incapacity of the maker
unless, before the vote is counted or the authority is exercised, written notice
of the death or incapacity is given to the secretary of the corporation.




                  (c) Expenses. Unless otherwise restricted in the articles, the
corporation shall pay the reasonable expenses of solicitation of votes, proxies
or consents of shareholders by or on behalf of the board of directors or its
nominees for election to the board, including solicitation by professional proxy
solicitors and otherwise.

                  Section 3.09 VOTING BY FIDUCIARIES AND PLEDGEES. Shares of the
corporation standing in the name of a trustee or other fiduciary and shares held
by an assignee for the benefit of creditors or by a receiver may be voted by the
trustee, fiduciary, assignee or receiver. A shareholder whose shares are pledged
shall be entitled to vote the shares until the shares have been transferred into
the name of the pledgee, or a nominee of the pledgee, but nothing in this
section shall affect the validity of a proxy given to a pledgee or nominee.

                  Section 3.10 VOTING BY JOINT HOLDERS OF SHARES.

                  (a) General rule. Where shares of the corporation are held
jointly or as tenants in common by two or more persons, as fiduciaries or
otherwise:

                      (1) if only one or more of such persons is present in
         person or by proxy, all of the shares standing in the names of such
         persons shall be deemed to be represented for the purpose of
         determining a quorum and the corporation shall accept as the vote of
         all the shares the vote cast by a joint owner or a majority of them;
         and

                      (2) if the persons are equally divided upon whether the
         shares held by them shall be voted or upon the manner of voting the
         shares, the voting of the shares shall be divided equally among the
         persons without prejudice to the rights of the joint owners or the
         beneficial owners thereof among themselves.

                  (b) Exception. If there has been filed with the secretary of
the corporation a copy, certified by an attorney at law to be correct, of the
relevant portions of the agreement under which the shares are held or the
instrument by which the trust or estate was created or the order of court
appointing them or of an order of court directing the voting of the shares, the
persons specified as having such voting power in the document latest in date of
operative effect so filed, and only those persons, shall be entitled to vote the
shares but only in accordance therewith.

                  Section 3.11 VOTING BY CORPORATIONS.

                  (a) Voting by corporate shareholders. Any corporation that is
a shareholder of this corporation may vote by any of its officers or agents, or
by proxy appointed by any officer or agent, unless some other person, by
resolution of the board of directors of the other corporation or provision of
its articles or bylaws, a copy of which resolution or provision certified to be
correct by one of its officers has been filed with the secretary of this
corporation, is appointed its general or special proxy in which case that person
shall be entitled to vote the shares.

                  (b) Controlled shares. Shares of this corporation owned,
directly or indirectly, by it and controlled, directly or indirectly, by the
board of directors of this corporation, as such,




shall not be voted at any meeting and shall not be counted in determining the
total number of outstanding shares for voting purposes at any given time.

                  Section 3.12 DETERMINATION OF SHAREHOLDERS OF RECORD.

                  (a) Fixing record date. The board of directors may fix a time
prior to the date of any meeting of shareholders as a record date for the
determination of the shareholders entitled to notice of, or to vote at, the
meeting, which time, except in the case of an adjourned meeting, shall be not
more than 90 days prior to the date of the meeting of shareholders. Only
shareholders of record on the date fixed shall be so entitled notwithstanding
any transfer of shares on the books of the corporation after any record date
fixed as provided in this subsection. The board of directors may similarly fix a
record date for the determination of shareholders of record for any other
purpose. When a determination of shareholders of record has been made as
provided in this section for purposes of a meeting, the determination shall
apply to any adjournment thereof unless the board fixes a new record date for
the adjourned meeting.

                  (b) Determination when a record date is not fixed. If a record
date is not fixed:

                      (1) The record date for determining shareholders entitled
         to notice of or to vote at a meeting of shareholders shall be at the
         close of business on the date next preceding the day on which notice is
         given or, if notice is waived, at the close of business on the day
         immediately preceding the day on which the meeting is held.

                      (2) The record date for determining shareholders entitled
         to express consent or dissent to corporate action in writing without a
         meeting, when prior action by the board of directors is not necessary,
         shall be the close of business on the day on which the first written
         consent or dissent is filed with the secretary of the corporation.

                      (3) The record date for determining shareholders for any
         other purpose shall be at the close of business on the day on which the
         board of directors adopts the resolution relating thereto.

                  Section 3.13 VOTING LISTS.

                  (a) General rule. The officer or agent having charge of the
transfer books for shares of the corporation shall make a complete list of the
shareholders entitled to vote at any meeting of shareholders, arranged in
alphabetical order, with the address of and of the number of shares held by
each. The list shall be produced and kept open at the time and place of the
meeting and shall be subject to the inspection of any shareholder during the
whole time of the meeting for the purposes thereof.

                  (b) Effect of list. Failure to comply with the requirements of
this section shall not effect the validity of any action taken at a meeting
prior to a demand at the meeting by any shareholder entitled to vote thereat to
examine the list. The original share register or transfer book, or a duplicate
thereof kept in this Commonwealth, shall be prima facie evidence as to who




are the shareholders entitled to examine the list or share register or transfer
book or to vote at any meeting of shareholders.

                  Section 3.14 JUDGES OF ELECTION.

                  (a) Appointment. In advance of any meeting of shareholders of
the corporation, the board of directors may appoint judges of election, who need
not be shareholders, to act at the meeting or any adjournment thereof. If judges
of election are not so appointed, the presiding officer of the meeting may, and
on the request of any shareholder shall, appoint judges of election at the
meeting. The number of judges shall be one or three. A person who is a candidate
for office to be filled at the meeting shall not act as a judge.

                  (b) Vacancies. In case any person appointed as a judge fails
to appear or fails or refuses to act, the vacancy may be filled by appointment
made by the board of directors in advance of the convening of the meeting or at
the meeting by the presiding officer thereof.

                  (c) Duties. The judges of election shall determine the number
of shares outstanding and the voting power of each, the shares represented at
the meeting, the existence of a quorum, the authenticity, validity and effect of
proxies, receive votes or ballots, hear and determine all challenges and
questions in any way arising in connection with the right to vote, count and
tabulate all votes, determine the result and do such acts as may be proper to
conduct the election or vote with fairness to all shareholders. The judges of
election shall perform their duties impartially, in good faith, to the best of
their ability and as expeditiously as is practical. If there are three judges of
election, the decision, act or certificate of a majority shall be effective in
all respects as the decision, act or certificate of all.

                  (d) Report. On request of the presiding officer of the
meeting, or of any shareholder, the judge shall make a report in writing of any
challenge or question or matter determined by them, and execute a certificate of
any fact found by them. Any report or certificate made by them shall be prima
facie evidence of the facts stated therein.

                  Section 3.15 CONSENT OF SHAREHOLDERS IN LIEU OF MEETING.

                  (a) Unanimous written consent. Any action required or
permitted to be taken at a meeting of the shareholders or of a class of
shareholders may be taken without a meeting if, prior or subsequent to the
action, a consent or consents thereto by all of the shareholders who would be
entitled to vote at a meeting for such purpose shall be filed with the secretary
of the corporation.

                  (b) Partial written consent. Any action required or permitted
to be taken at a meeting of the shareholders or of a class of shareholders may
be taken without a meeting upon the written consent of shareholders who would
have been entitled to cast the minimum number of votes that would be necessary
to authorize the action at a meeting at which all shareholders entitled to vote
thereon were present and voting. The consents shall be filed with the secretary
of the corporation. The action shall not become effective until after at least
ten days' written notice of the action has been given to each shareholder
entitled to vote thereon who has not consented thereto.





                  Section 3.16 MINORS AS SECURITY HOLDERS. The corporation may
treat a minor who holds shares or obligations of the corporation as having
capacity to receive and to empower others to receive dividends, interest,
principal and other payments or distributions, to vote or express consent or
dissent and to make elections and exercise rights relating to such shares or
obligations unless, in the case of payments or distributions on shares, the
corporate officer responsible for maintaining the list of shareholders or the
transfer agent of the corporation or, in the case of payments or distributions
on obligations, the treasurer or paying officer or agent has received written
notice that the holder is a minor.

                                   ARTICLE IV
                               BOARD OF DIRECTORS

                  Section 4.01 POWERS; PERSONAL LIABILITY.

                  (a) General rule. Unless otherwise provided by statute all
powers vested by law in the corporation shall be exercised by or under the
authority of, and the business and affairs of the corporation shall be managed
under the direction of, the board of directors.

                  (b) Standard of care; justifiable reliance. A director shall
stand in a fiduciary relation to the corporation and shall perform his or her
duties as a director, including duties as a member of any committee of the board
upon which the director may serve, in good faith, in a manner the director
reasonably believes to be in the best interests of the corporation and with such
care, including reasonable inquiry, skill and diligence, as a person of ordinary
prudence would use under similar circumstances. In performing his or her duties,
a director shall be entitled to rely in good faith on information, opinions,
reports or statements, including financial statements and other financial data,
in each case prepared or presented by any of the following:

                      (1) One or more officers or employees of the corporation
         whom the director reasonably believes to be reliable and competent in
         the matters presented.

                      (2) Counsel, public accountants or other persons as to
         matters which the director reasonably believes to be within the
         professional or expert competence of such person.

                      (3) A committee of the board upon which the director does
         not serve, duly designated in accordance with law, as to matters within
         its designated authority, which committee the director reasonably
         believes to merit confidence.

A director shall not be considered to be acting in good faith if the director
has knowledge concerning the matter in question that would cause his or her
reliance to be unwarranted.

                  (c) Consideration of factors. In discharging the duties of
their respective positions, the board of directors, committees of the board and
individual directors may, in considering the best interests of the corporation,
consider the effects of any action upon employees, upon suppliers and customers
of the corporation and upon communities in which




offices or other establishments of the corporation are located, and all other
pertinent factors. The consideration of those factors shall not constitute a
violation of subsection (b).

                  (d) Presumption. Absent breach of fiduciary duty, lack of good
faith or self-dealing, actions taken as a director or any failure to take any
action shall be presumed to be in the best interests of the corporation.

                  (e) Personal liability of directors.

                      (1) A director shall not be personally liable, as such,
         for monetary damages for any action taken, or any failure to take any
         action, unless:

                          (i) the director has breached or failed to perform the
                  duties of his or her office under this section; and

                          (ii) the breach or failure to perform constitutes
                  self-dealing, willful misconduct or recklessness.

                      (2) The provisions of paragraph (1) shall not apply to the
         responsibility or liability of a director pursuant to any criminal
         statute, or the liability of a director for the payment of taxes
         pursuant to local, State or Federal law.

                  (f) Notation of dissent. A director who is present at a
meeting of the board of directors, or of a committee of the board, at which
action on any corporate matter is taken shall be presumed to have assented to
the action taken unless his or her dissent is entered in the minutes of the
meeting or unless the director files a written dissent to the action with the
secretary of the meeting before the adjournment thereof or transmits the dissent
in writing to the secretary of the corporation immediately after the adjournment
of the meeting. The right to dissent shall not apply to a director who voted in
favor of the action. Nothing in this section shall bar a director from asserting
that minutes of the meeting incorrectly omitted his or her dissent if, promptly
upon receipt of a copy of such minutes, the director notifies the secretary in
writing, of the asserted omission or inaccuracy.

                  Section 4.02 QUALIFICATION AND SELECTION OF DIRECTORS.

                  (a) Qualifications. Each director of the corporation shall be
a natural person of full age who need not be a resident of Pennsylvania or a
shareholder of the corporation.

                  (b) Election of directors. Except as otherwise provided in
these bylaws, directors of the corporation shall be elected by the shareholders.
In elections for directors, voting need not be by ballot, except upon demand
made by a shareholder entitled to vote at the election and before the voting
begins. The candidates receiving the highest number of votes from each class or
group of classes, if any, entitled to elect directors separately up to the
number of directors to be elected by the class or group of classes shall be
elected. If at any meeting of shareholders, directors of more than one class are
to be elected, each class of directors shall be elected in a separate election.





                  (c) Cumulative voting. Unless the articles provide for
straight voting, in each election of directors every shareholder entitled to
vote shall have the right to multiply the number of votes to which the
shareholder may be entitled by the total number of directors to be elected in
the same election by the holders of the class or classes of shares of which his
or her shares are a part and the shareholders may cast the whole number of his
or her votes for one candidate or may distribute them among two or more
candidates.

                  Section 4.03 NUMBER AND TERM OF OFFICE.

                  (a) The number of authorized Directors of the Corporation
shall be not less than 1 nor more than 15, fixed from time to time by the
Shareholder. The Directors shall be elected at the annual meeting of the
Shareholders and each Director shall be elected to serve until his successor
shall be elected and shall qualify.

                  Section 4.04 VACANCIES.

                  (a) General rule. Vacancies in the board of directors,
including vacancies resulting from an increase in the number of directors, may
be filled by a majority vote of the remaining members of the board though less
than a quorum, or by a sole remaining director, and each person so selected
shall be a director to serve for the balance of the unexpired term, and until a
successor has been selected and qualified or until his or her earlier death,
resignation or removal.

                  (b) Action by resigned directors. When one or more directors
resign from the board effective at a future date, the directors then in office,
including those who have so resigned, shall have power by the applicable vote to
fill the vacancies, the vote thereon to take effect when the resignations become
effective.

                  Section 4.05 REMOVAL OF DIRECTORS.

                  (a) Removal by the shareholders. The entire board of
directors, or any class of the board, or any individual director may be removed
from office without assigning any cause by the vote of shareholders, or of the
holders of a class or series of shares, entitled to elect directors, or the
class of directors. In case the board or a class of the board or any one or more
directors are so removed, new directors may be elected at the same meeting. The
board of directors may be removed at any time with or without cause by the
unanimous vote or consent of shareholders entitled to vote thereon.

                  (b) Removal by the board. The board of directors may declare
vacant the office of a director who has been judicially declared of unsound mind
or who has been convicted of an offense punishable by imprisonment for a term of
more than one year or if, within 60 days after notice of his or her selection,
the director does not accept the office either in writing or by attending a
meeting of the board of directors.

                  (c) Removal of directors elected by cumulative voting. An
individual director shall not be removed (unless the entire board or class of
the board is removed) if sufficient votes are cast against the resolution for
his removal which, if cumulatively voted at an annual or other





regular election of directors, would be sufficient to elect one or more
directors to the board or to the class.

                  Section 4.06 PLACE OF MEETINGS. Meetings of the board of
directors may be held at such place within or without Pennsylvania as the board
of directors may from time to time appoint or as may be designated in the notice
of the meeting.

                  Section 4.07 ORGANIZATION OF MEETINGS. At every meeting of the
board of directors, the chairman of the board, if there be one, or, in the case
of a vacancy in the office or absence of the chairman of the board, one of the
following officers present in the order stated: the vice chairman of the board,
if there be one, the president, the vice presidents in their order of rank and
seniority, or a person chosen by a majority of the directors present, shall act
as chairman of the meeting. The secretary or, in the absence of the secretary,
an assistant secretary, or, in the absence of the secretary and the assistant
secretaries, any person appointed by the chairman of the meeting, shall act as
secretary.

                  Section 4.08 REGULAR MEETINGS. Regular meetings of the board
of directors shall be held at such time and place as shall be designated from
time to time by resolution of the board of directors.

                  Section 4.09 SPECIAL MEETINGS. Special meetings of the board
of directors shall be held whenever called by the chairman or by two or more of
the directors.

                  Section 4.10 QUORUM OF AND ACTION BY DIRECTORS.

                  (a) General rule. A majority of the directors in office of the
corporation shall be necessary to constitute a quorum for the transaction of
business and the acts of a majority of the directors present and voting at a
meeting at which a quorum is present shall be the acts of the board of
directors.

                  (b) Action by written consent. Any action required or
permitted to be taken at a meeting of the directors may be taken without a
meeting if, prior or subsequent to the action, a consent or consents thereto by
all of the directors in office is filed with the secretary of the corporation.

                  Section 4.11 EXECUTIVE AND OTHER COMMITTEES.

                  (a) Establishment and powers. The board of directors may, by
resolution adopted by a majority of the directors in office, establish one or
more committees to consist of one or more directors of the corporation. Any
committee, to the extent provided in the resolution of the board of directors,
shall have and may exercise all of the powers and authority of the board of
directors except that a committee shall not have any power or authority as to
the following:

                      (1) The submission to shareholders of any action requiring
         approval of shareholders under the Business Corporation Law.

                      (2) The creation or filling of vacancies in the board of
         directors.







                      (3) The adoption, amendment or repeal of these bylaws.

                      (4) The amendment or repeal of any resolution of the board
         that by its terms is amendable or repealable only by the board.

                      (5) Action on matters committed by a resolution of the
         board of directors to another committee of the board.

                  (b) Alternate committee members. The board may designate one
or more directors as alternate members of any committee who may replace any
absent or disqualified member at any meeting of the committee or for the
purposes of any written action by the committee. In the absence or
disqualification of a member and alternate member or members of a committee, the
member or members thereof present at any meeting and not disqualified from
voting, whether or not constituting a quorum, may unanimously appoint another
director to act at the meeting in the place of the absent or disqualified
member.

                  (c) Term. Each committee of the board shall serve at the
pleasure of the board.

                  (d) Committee procedures. The term "board of directors" or
"board," when used in any provision of these bylaws relating to the organization
or procedures of or the manner of taking action by the board of directors, shall
be construed to include and refer to any executive or other committee of the
board.

                  Section 4.12 COMPENSATION. The board of directors shall have
the authority to fix compensation of directors for their services as directors
and a director may be a salaried officer of the corporation.

                                   ARTICLE V
                                    OFFICERS

                  Section 5.01 OFFICERS GENERALLY.

                  (a) Number, qualification and designation. The officers of the
corporation shall be a president, a secretary, a treasurer, and such other
officers as may be elected in accordance with the provisions of Section 5.03.
Officers may but need not be directors or shareholders of the corporation. The
president and secretary shall be natural persons of full age. The treasurer may
be a corporation, but if a natural person shall be of full age. The board of
directors may elect from among the members of the board a chairman of the board
and a vice chairman of the board who shall be officers of the corporation. Any
number of offices may be held by the same person.

                  (b) Resignations. Any officer may resign at any time upon
written notice to the corporation. The resignation shall be effective upon
receipt thereof by the corporation or at such subsequent time as may be
specified in the notice of resignation.





                  (c) Bonding. The corporation may secure the fidelity of any or
all of its officers by bond or otherwise.

                  (d) Standard of care. Except as otherwise provided in the
articles, an officer shall perform his or her duties as an officer in good
faith, in a manner he or she reasonably believes to be in the best interests of
the corporation and with such care, including reasonable inquiry, skill and
diligence, as a person of ordinary prudence would use under similar
circumstances. A person who so performs his or her duties shall not be liable by
reason of having been an officer of the corporation.

                  Section 5.02 ELECTION AND TERM OF OFFICE. The officers of the
corporation, except those elected by delegated authority pursuant to Section
5.03, shall be elected annually by the board of directors, and each such officer
shall hold office for a term of one year and until a successor has been selected
and qualified or until his or her earlier death, resignation or removal.

                  Section 5.03 SUBORDINATE OFFICERS, COMMITTEES AND AGENTS. The
board of directors may from time to time elect such other officers and appoint
such committees, employees or other agents as the business of the corporation
may require, including one or more assistant secretaries, and one or more
assistant treasurers, each of whom shall hold office for such period, have such
authority, and perform such duties as are provided in these bylaws or as the
board of directors may from time to time determine. The board of directors may
delegate to any officer or committee the power to elect subordinate officers and
to retain or appoint employees or other agents, or committees thereof and to
prescribe the authority and duties of such subordinate officers, committees,
employees or other agents.

                  Section 5.04 REMOVAL OF OFFICERS AND AGENTS. Any officer or
agent of the corporation may be removed by the board of directors with or
without cause. The removal shall be without prejudice to the contract rights, if
any, of any person so removed. Election or appointment of an officer or agent
shall not of itself create contract rights.

                  Section 5.05 VACANCIES. A vacancy in any office because of
death, resignation, removal, disqualification,, or any other cause, shall be
filled by the board of directors or by the officer or committee to which the
power to fill such office has been delegated pursuant to Section 5.03, as the
case may be, and if the office is one for which these bylaws prescribe a term,
shall be filled for the unexpired portion of the term.

                  Section 5.06 AUTHORITY. All officers of the corporation, as
between themselves and the corporation, shall have such authority and perform
such duties in the management of the corporation as may be provided by or
pursuant to resolution or orders of the board of directors or in the absence of
controlling provisions in the resolutions or orders of the board of directors,
as may be determined by or pursuant to these bylaws.

                  Section 5.07 THE CHAIRMAN OF THE BOARD. The chairman of the
board if there be one, or in the absence of the chairman, the vice chairman of
the board, shall preside at all meetings of the shareholders and of the board of
directors and shall perform such other duties as may from time to time be
requested by the board of directors.





                  Section 5.08 THE PRESIDENT. The president shall be the chief
executive officer of the corporation and shall have general supervision over the
business and operations of the corporation, subject however, to the control of
the board of directors. The president shall sign, execute, and acknowledge, in
the name of the corporation, deeds, mortgages, contracts or other instruments
authorized by the board of directors, except in cases where the signing and
execution thereof shall be expressly delegated by the board of directors, or by
these bylaws, to some other officer or agent of the corporation; and, in
general, shall perform all duties incident to the office of president and such
other duties as from time to time may be assigned by the board of directors.

                  Section 5.09 THE SECRETARY. The secretary or an assistant
secretary shall attend all meetings of the shareholders and of the board of
directors and shall record all votes of the shareholders and of the directors
and the minutes of the meetings of the shareholders and of the board of
directors and of committees of the board in a book or books to be kept for that
purpose; shall see that notices are given and records and reports properly kept
and filed by the corporation as required by law; shall be the custodian of the
seal of the corporation and see that it is affixed to all documents to be
executed on behalf of the corporation under its seal; and, in general, shall
perform all duties incident to the office of secretary, and such other duties as
may from time to time be assigned by the board of directors or the president.

                  Section 5.10 THE TREASURER. The treasurer or an assistant
treasurer shall have or provide for the custody of the funds or other property
of the corporation; shall collect and receive or provide for the collection and
receipt of moneys earned by or in any manner due to or received by the
corporation; shall deposit all funds in his or her custody as treasurer in such
banks or other places of deposit as the board of directors may from time to time
designate; shall, whenever so required by the board of directors, render an
account showing all transactions as treasurer and the financial condition of the
corporation; and, in general, shall discharge such other duties as may from time
to time be assigned by the board of directors or the president.

                  Section 5.11 SALARIES. The salaries of the officers elected by
the board of directors shall be fixed from time to time by the board of
directors or by such officer as may be designated by resolution of the board.
The salaries or other compensation of any other officers, employees and other
agents shall be fixed from time to time by the officer or committee to which the
power to elect such officers or to retain or appoint such employees or other
agents has been delegated pursuant to Section 5.03. No officer shall be
prevented from receiving such salary or other compensation by reason of the fact
that the officer is also a director of the corporation.

                  Section 5.12 DISALLOWED COMPENSATION. Any payments made to an
officer or employee of the corporation such as a salary, commission, bonus,
interest, rent, travel or entertainment expense incurred by him, which shall be
disallowed in whole or in part as a deductible expense by the Internal Revenue
Service, shall be reimbursed by such officer or employee to the corporation to
the full extent of such disallowance. It shall be the duty of the directors, as
a Board, to enforce payment of each such amount disallowed. In lieu of payment
by the officer or employee, subject to the determination of the directors,
proportionate amounts may be withheld from future compensation payments until
the amount owed to the corporation has been recovered.




                                   ARTICLE VI
                      CERTIFICATES OF STOCK, TRANSFER, ETC.

                  Section 6.01 SHARE CERTIFICATES. Certificates for shares of
the corporation shall be in such form as approved by the board of directors, and
shall state that the corporation is incorporated under the laws of Pennsylvania,
the name of the person to whom issued, and the number and class of shares and
the designation of the series (if any) that the certificate represents. The
share register or transfer books and blank share certificates shall be kept by
the secretary or by any transfer agent or registrar designated by the board of
directors for that purpose.

                  Section 6.02 ISSUANCE. The share certificates of the
corporation shall be numbered and registered in the share register or transfer
books of the corporation as they are issued. They shall be signed by the
president or a vice president and by the secretary or an assistant secretary or
the treasurer or an assistant treasurer, and shall bear the corporate seal,
which may be a facsimile, engraved or printed; but where such certificate is
signed by a transfer agent or a registrar the signature of any corporate officer
upon such certificate may be a facsimile, engraved or printed. In case any
officer who has signed, or whose facsimile signature has been placed upon, any
share certificate shall have ceased to be such officer because of death,
resignation or otherwise, before the certificate is issued, it may be issued
with the same effect as if the officer had not ceased to be such at the date of
its issue. The provisions of this Section 6.02 shall be subject to any
inconsistent or contrary agreement at the time between the corporation and any
transfer agent or registrar.

                  Section 6.03 TRANSFER. Transfers of shares shall be made on
the share register or transfer books of the corporation upon surrender of the
certificate therefor, endorsed by the person named in the certificate or by an
attorney lawfully constituted in writing. No transfer shall be made inconsistent
with the provisions of the Uniform Commercial Code, 13 Pa.C.S. 8101 et seq., and
its amendments and supplements.

                  Section 6.04 RECORD HOLDER OF SHARES. The corporation shall be
entitled to treat the person in whose name any share or shares of the
corporation stand on the books of the corporation as the absolute owner thereof,
and shall not be bound to recognize any equitable or other claim to, or interest
in, such share or shares on the part of any other person.

                  Section 6.05 RESTRICTION ON TRANSFER OF SHARES.

                  (a) General rule. A shareholder shall not sell, transfer or
otherwise dispose of the shareholder's shares to anyone other than a person who
is already a registered shareholder in the corporation without first offering
them to the corporation and its shareholders by notice in writing to the
secretary of the corporation.

                  (b) Offer upon death of a shareholder. Upon the death of a
shareholder, the executor or administrator of the deceased shareholder, as soon
as possible thereafter, shall offer the decedent's shares to the corporation and
its shareholders by notice in writing to the secretary of the corporation.





                  (c) Procedure for acceptance of offer. The corporation shall
have a period of 60 days after receipt of the offer specified in subsection (a)
or (b) in which to accept the offer in whole or in part at the price set forth
in subsection (d). If the corporation determines to reject all or any part of
the offer, the secretary of the corporation shall on or before the day on which
the 60 day period expires notify in writing the offering shareholder or the
executor or administrator of the deceased shareholder and all other shareholders
of the existence and terms of the offer and of the portion of the offer rejected
by the corporation, whereupon all other shareholders shall have an additional
period of 30 days after the giving of the notice of rejection in which to accept
all or any part of the offer or part thereof rejected by the corporation. If the
purchasing shareholders cannot agree upon their respective proportions of the
shares to be purchased, the shares shall be apportioned among the shareholders
desiring to purchase shares in proportion to their respective holdings of shares
in the corporation on the day the offer first accrued to the corporation. If the
corporation and its shareholders determine to reject all or any part of the
offer, the secretary of the corporation shall promptly furnish to the offering
shareholder or the executor or administrator of the deceased shareholder a
written statement setting forth the rejection and permitting the sale of the
rejected shares to any purchaser within a period of 60 days after the date of
the written statement. Upon becoming a shareholder of the corporation any such
purchaser shall hold shares subject to this bylaw.

                  (d) Price of shares. The price at which shares shall be
offered to the corporation and its shareholders under the terms of subsection
(a) or (b) shall be the fair value of the shares determined as of the last day
of the calendar quarter immediately preceding the date of the offer. The party
purchasing the largest amount of offered shares, or the one of them selected by
lot, if two or more parties purchase identical and largest amounts of offered
shares, and the offering shareholder or the executor or administrator of the
deceased shareholder, shall within 15 days after the day on which the number of
shares to be purchased has been finally established select (and notify all other
parties in writing of such selection) an appraiser experienced in the valuation
of securities of enterprises of the same character as that of the corporation.
The two appraisers so appointed shall promptly meet and agree upon the fair
value of the shares, and shall promptly notify the parties in writing of their
determination. Payment in cash for the shares based upon the value so fixed and
delivery of the certification for the shares shall be made within 60 days of the
giving of the notice by the appraisers. If, because of failure of a party to
appoint an appraiser or of their failure to agree, or if for any other reason a
fair value has not been fixed for the shares within 30 days after the
appointment of the first appraiser or if settlement has not been made, any
controversy or claim arising out of or relating to this bylaw, or the breach
thereof (including the fair value of the shares if not yet determined), shall,
at the request of any party, be submitted to one arbitrator selected from the
panels of arbitrators of the American Arbitration Association and shall be
settled by arbitration in accordance with the rules of the American Arbitration
Association, and judgement upon the award rendered by the arbitrator may be
entered in any court having jurisdiction thereof.

                  (e) Certificate legend. All certificates for shares of this
corporation shall have the following legend printed or stamped thereon:

                      "The shares represented by this certificate may not be
                  sold, assigned, transferred, pledged or otherwise disposed of,
                  except in




                  accordance with the terms and conditions of the bylaws of the
                  corporation."

                  (f) Status of bylaw. Notwithstanding any other provision of
these bylaws or of the Business Corporation Law, this bylaw shall constitute a
contract among the shareholders of the corporation, and shall not be amended
without their unanimous consent.

                  Section 6.06 LOST, DESTROYED OR MUTILATED CERTIFICATES. The
holder of any shares of the corporation shall immediately notify the corporation
of any loss, destruction or mutilation of the certificate therefor, and the
board of directors may, in its discretion, cause a new certificate or
certificates to be issued to such holder, in case of mutilation of the
certificate, upon the surrender of the mutilated certificate or, in case of loss
or destruction of the certificate, upon satisfactory proof of such loss or
destruction and, if the board of directors shall so determine, the deposit of a
bond in such form and in such sum, and with such surety or sureties, as it may
direct.

                                  ARTICLE VII
                   INDEMNIFICATION OF DIRECTORS, OFFICERS AND
                        OTHER AUTHORIZED REPRESENTATIVES

                  Section 7.01 SCOPE OF INDEMNIFICATION.

                  (a) General rule. The corporation shall indemnify an
indemnified representative against any liability incurred in connection with any
proceeding in which the indemnified representative may be involved as a party or
otherwise by reason of the fact that such person is or was serving in an
indemnified capacity, including, without limitation, liabilities resulting from
any actual or alleged breach or neglect of duty, error, misstatement or
misleading statement, negligence, gross negligence or act giving rise to strict
or products liability, except:

                      (1) where such indemnification is expressly prohibited by
         applicable law;

                      (2) where the conduct of the indemnified representative
         has been finally determined pursuant to Section 7.06 or otherwise:

                          (i) to constitute willful misconduct or recklessness
                  within the meaning of 15 Pa.C.S. 513(b) and 1746(b) and 42
                  Pa.C.S. 8365(b) or any superseding provision of law sufficient
                  in the circumstances to bar indemnification against
                  liabilities arising from the conduct; or

                          (ii) to be based upon or attributable to the receipt
                  by the indemnified representative from the corporation of a
                  personal benefit to which the indemnified representative is
                  not legally entitled; or








                       (3) to the extent such indemnification has been finally
         determined in a final adjudication pursuant to Section 7.06 to be
         otherwise unlawful.

                  (b) Partial payment. If an indemnified representative is
entitled to indemnification in respect of a portion, but not all, of any
liabilities to which such person may be subject, the corporation shall indemnify
such indemnified representative to the maximum extent for such portion of the
liabilities.

                  (c) Presumption. The termination of a proceeding by judgment,
order, settlement or conviction or upon a plea of nolo contendere or its
equivalent shall not of itself create a presumption that the indemnified
representative is not entitled to indemnification.

                  (d) Definitions. For purposes of this Article:

                      (1) "indemnified capacity" means any and all past, present
         and future service by an indemnified representative in one or more
         capacities as a director, officer, employee or agent of the
         corporation, or, at the request of the corporation, as a director,
         officer, employee, agent, fiduciary or trustee of another corporation,
         partnership, joint venture, trust, employee benefit plan or other
         entity or enterprise;

                      (2) "indemnified representative" means any and all
         directors-and officers of the corporation and any other person
         designated as an indemnified representative by the board of directors
         of the corporation (which may, but need not, include any person serving
         at the request of the corporation, as a director, officer, employee,
         agent, fiduciary or trustee of another corporation, partnership, joint
         venture, trust, employee benefit plan or other entity or enterprise):

                      (3) "liability" means any damage, judgment, amount paid in
         settlement, fine, penalty, punitive damages, excise tax assessed with
         respect to an employee benefit plan, or cost or expense, of any nature
         (including, without limitation, attorneys' fees and disbursements); and

                      (4) "proceeding" means any threatened, pending or
         completed action, suit, appeal or other proceeding of any nature,
         whether civil, criminal, administrative or investigative, whether
         formal or informal, and whether brought by or in the right of the
         corporation, a class of its security holders or otherwise.

                  Section 7.02 PROCEEDINGS INITIATED BY INDEMNIFIED
REPRESENTATIVES. Notwithstanding any other provision of this Article, the
corporation shall not indemnify under this Article an indemnified representative
for any liability incurred in a proceeding initiated (which shall not be deemed
to include counter-claims or affirmative defenses) or participated in as an
intervenor or amicus curiae by the person seeking indemnification unless such
initiation of or participation in the proceeding is authorized, either before or
after its commencement, by the affirmative vote of a majority of the directors
in office. This section does not apply to a reimbursement of expenses incurred
in successfully prosecuting






or defending an arbitration under Section 7.06 or otherwise successfully
prosecuting or defending the rights of an indemnified representative granted by
or pursuant to this Article.

                  Section 7.03 ADVANCING EXPENSES. The corporation shall pay the
expenses (including attorneys' fees and disbursements) incurred in good faith by
an indemnified representative in advance of the final disposition of a
proceeding described in Section 7.01 or the initiation of or participation in
which is authorized pursuant to Section 7.02 upon receipt of an undertaking by
or on behalf of the indemnified representative to repay the amount if it is
ultimately determined pursuant to Section 7.06 that such person is not entitled
to be indemnified by the corporation pursuant to this Article. The financial
ability of an indemnified representative to repay an advance shall not be a
prerequisite to the making of such advance.

                  Section 7.04 SECURING OF INDEMNIFICATION OBLIGATIONS. To
further effect, satisfy or secure the indemnification obligations provided
herein or otherwise, the corporation may maintain insurance, obtain a letter of
credit, act as self-insurer, create a reserve, trust, escrow, cash collateral or
other fund or account, enter into indemnification agreements, pledge or grant a
security interest in any assets or properties of the corporation, or use any
other mechanism or arrangement whatsoever in such amounts, at such costs, and
upon such other terms and conditions as the board of directors shall deem
appropriate. Absent fraud, the determination of the board of directors with
respect to such amounts, costs, terms and conditions shall be conclusive against
all security holders, officers and directors and shall not be subject to
voidability.

                  Section 7.05 PAYMENT OF INDEMNIFICATION. An indemnified
representative shall be entitled to indemnification within 30 days after a
written request for indemnification has been delivered to the secretary of the
corporation.

                  Section 7.06 ARBITRATION.

                  (a) General rule. Any dispute related to the right to
indemnification, contribution or advancement of expenses as provided under this
Article, except with respect to indemnification for liabilities arising under
the Securities Act of 1933 that the corporation has undertaken to submit to a
court for adjudication, shall be decided only by arbitration in the metropolitan
area in which the principal executive offices of the corporation are located at
the time, in accordance with the commercial arbitration rules then in effect of
the American Arbitration Association, before a panel of three arbitrators, one
of whom shall be selected by the corporation, the second of whom shall be
selected by the indemnified representative and third of whom shall be selected
by the other two arbitrators. In the absence of the American Arbitration
Association, or if for any reason arbitration under the arbitration rules of the
American Arbitration Association cannot be initiated, or if one of the parties
fails or refuses to select an arbitrator or if the arbitrators selected by the
corporation and the indemnified representative cannot agree on the selection of
the third arbitrator within 30 days after such time as the corporation and the
indemnified representative have each been notified of the selection of the
other's arbitrator, the necessary arbitrator or arbitrators shall be selected by
the presiding judge of the court of general jurisdiction in such metropolitan
area.




                  (b) Burden of proof. The party or parties challenging the
right of an indemnified representative to the benefits of this Article shall
have the burden of proof.

                  (c) Expenses. The corporation shall reimburse an indemnified
representative for the expenses (including attorneys' fees and disbursements)
incurred in successfully prosecuting or defending such arbitration.

                  (d) Effect. Any award entered by the arbitrators shall be
final, binding and nonappealable and judgment may be entered thereon by any
party in accordance with applicable law in any court of competent jurisdiction,
except that the corporation shall be entitled to interpose as a defense in any
such judicial enforcement proceeding any prior final judicial determination
adverse to the indemnified representative under Section 7.01(a)(2) in a
proceeding not directly involving indemnification under this Article. This
arbitration provision shall be specifically enforceable.

                  Section 7.07 CONTRIBUTION. If the indemnification provided for
in this Article or otherwise is unavailable for any reason in respect of any
liability or portion thereof, the corporation shall contribute to the
liabilities to which the indemnified representative may be subject in such
proportion as is appropriate to reflect the intent of this Article or otherwise.

                  Section 7.08 MANDATORY INDEMNIFICATION OF DIRECTORS, OFFICERS,
ETC. To the extent that an authorized representative of the corporation has been
successful on the merits or otherwise in defense of any action or proceeding
referred to in 15 Pa.C.S. 1741 or 1742 or in defense of any claim, issue or
matter therein, such person shall be indemnified against expenses (including
attorneys' fees and disbursements) actually and reasonably incurred by such
person in connection therewith.

                  Section 7.09 CONTRACT RIGHTS; AMENDMENT OR REPEAL. All rights
under this Article shall be deemed a contract between the corporation and the
indemnified representative pursuant to which the corporation and each
indemnified representative intend to be legally bound. Any repeal, amendment or
modification hereof shall be prospective only and shall not affect any rights or
obligations then existing.

                  Section 7.10 SCOPE OF ARTICLE. The rights granted by this
Article shall not be deemed exclusive of any other rights to which those seeking
indemnification, contribution or advancement of expenses may be entitled under
any statute, agreement, vote of shareholders or disinterested directors or
otherwise both as to action in an indemnified capacity and as to action in any
other capacity. The indemnification, contribution and advancement of expenses
provided by or granted pursuant to this Article shall continue as to a person
who has ceased to be an indemnified representative in respect of matters arising
prior to such time, and shall inure to the benefit of the heirs, executors,
administrators and personal representatives of such a person.

                  Section 7.11 RELIANCE OF PROVISIONS. Each person who shall act
as an indemnified representative of the corporation shall be deemed to be doing
so in reliance upon the rights provided in this Article.

                  Section 7.12 INTERPRETATION. The provisions of this Article
are intended to constitute bylaws authorized by 15 Pa.C.S. 513 and 1746 and 42
Pa.C.S. 8365.




                                  ARTICLE VIII
                                  MISCELLANEOUS

                  Section 8.01 CORPORATE SEAL. The corporation seal shall have
inscribed thereon the name of the corporation, the year of its organization and
the words "Corporate Seal, Pennsylvania".

                  Section 8.02 CHECKS. All checks, notes, bills of exchange or
other orders in writing shall be signed by such person or persons as the board
of directors or any person authorized by resolution of the board of directors
may from time to time designate.

                  Section 8.03 CONTRACTS.

                  (a) General rule. Excepts as otherwise provided in the
Business Corporation Law in the case of transactions that require action by the
shareholders, the board of directors may authorize any officer or agent to enter
into any contract or to execute or deliver any instrument on behalf of the
corporation, and such authority may be general or confined to specific
instances.

                  (b) Statutory form of execution of instruments. Any note,
mortgage, evidence of indebtedness, contract or other document, or any
assignment or endorsement thereof, executed or entered into between the
corporation and any other person, when signed by one or more officers or agents
having actual or apparent authority to sign it, or by the president or vice
president and secretary or assistant secretary or treasurer or assistant
treasurer of the corporation, shall be held to have been properly executed for
and in behalf of the corporation, without prejudice to the rights of the
corporation against any person who shall have executed the instrument in excess
of his or her actual authority.

                  Section 8.04 INTERESTED DIRECTORS OR OFFICERS; QUORUM.

                  (a) General rule. A contract or transaction between the
corporation and one or more of its directors or officers or between the
corporation and another corporation, partnership, joint venture, trust or other
enterprise in which one or more of its directors or officers are directors or
officers or have a financial or other interest, shall not be void or voidable
solely for that reason, or solely because the director or officer is present at
or participates in the meeting of the board of directors that authorizes the
contract or transaction, or solely because his, her or their votes are counted
for that purpose, if:

                      (1) the material facts as to the relationship or interest
         and as to the contract or transaction are disclosed or are known to the
         board of directors and the board authorizes the contract or transaction
         by the affirmative votes of a majority of the disinterested directors
         even though the disinterested directors are less than a quorum;

                      (2) the material facts as to his or her relationship or
         interest and as to the contract or transaction are disclosed or are
         known to the shareholders entitled to vote thereon and the contract or
         transaction is specifically approved in good faith by vote of those
         shareholders; or




                      (3) the contract or transaction is fair as to the
         corporation as of the time it is authorized, approved or ratified by
         the board of directors or the shareholders.

                  (b) Quorum. Common or interested directors may be counted in
determining the presence of a quorum at a meeting of the board which authorizes
a contract or transaction specified in subsection (a).

                  Section 8.05 DEPOSITS. All funds of the corporation shall be
deposited from time to time to the credit of the corporation in such banks,
trust companies or other depositaries as the board of directors may approve or
designate, and all such funds shall be withdrawn only upon checks signed by such
one or more officers or employees as the board of directors shall from time to
time determine.

                  Section 8.06 CORPORATE RECORDS.

                  (a) Required records. The corporation shall keep complete and
accurate books and records of account, minutes of the proceedings of the
incorporators, shareholders and directors and a share register giving the names
and addresses of all shareholders and the number and class of shares held by
each. The share register shall be kept at either the registered office of the
corporation in Pennsylvania or at its principal place of business wherever
situated or at the office of its registrar or transfer agent. Any books, minutes
or other records may be in written form or any other form capable of being
converted into written form within a reasonable time.

                  (b) Right of inspection. Every shareholder shall, upon written
verified demand stating the purpose thereof, have a right to examine, in person
or by agent or attorney, during the usual hours for business for any proper
purpose, the share register, books and records of account, and records of the
proceedings of the incorporators, shareholders and directors and to make copies
or extracts therefrom. A proper purpose shall mean a purpose reasonably related
to the interest of the person as a shareholder. In every instance where an
attorney or other agent is the person who seeks the right of inspection, the
demand shall be accompanied by a verified power of attorney or other writing
that authorizes the attorney or other agent to so act on behalf of the
shareholder. The demand shall be directed to the corporation at its registered
office in Pennsylvania or at its principal place of business wherever situated.

                  Section 8.07 FINANCIAL REPORTS. Unless otherwise agreed
between the corporation and a shareholder, the corporation shall furnish to its
shareholders annual financial statements, including at least a balance sheet as
of the end of each fiscal year and a statement of income and expenses for the
fiscal year. The financial statements shall be prepared on the basis of
generally accepted accounting principles, if the corporation prepares financial
statements for the fiscal year on that basis for any purpose, and may be
consolidated statements of the corporation and one or more of its subsidiaries.
The financial statements shall be mailed by the corporation to each of its
shareholders entitled thereto within 120 days after the close of each fiscal
year and, after the mailing and upon written request, shall be mailed by the
corporation to any shareholder or beneficial owner entitled thereto to whom a
copy of the most recent annual financial statements has not previously been
mailed. Statements that are audited or reviewed by a public accountant shall be
accompanied by the report of the accountant; in other cases, each




copy shall be accompanied by a statement of the person in charge of the
financial records of the corporation:

                      (1) Stating his reasonable belief as to whether or not the
         financial statements were prepared in accordance with generally
         accepted accounting principles and, if not, describing the basis of
         presentation.

                      (2) Describing any material respects in which the
         financial statements were not prepared on a basis consistent with those
         prepared for the previous year.

                  Section 8.08 AMENDMENT OF BYLAWS. These bylaws may be amended
or repealed, or new bylaws may be adopted, either (i) by vote of the
shareholders at any duly organized annual or special meeting of shareholders, or
(ii) with respect to those matters that are not by statute committed expressly
to the shareholders and regardless of whether the shareholders have previously
adopted or approved the bylaw being amended or repealed, by vote of a majority
of the board of directors of the corporation in office at any regular or special
meeting of directors. Any change in these bylaws shall take effect when adopted
unless otherwise provided in the resolution effecting the change. See Section
2.03(b) (relating to notice of action by shareholders on bylaws).

                  Section 8.09 CAPITALIZATION AND EXPENSING OF ASSETS. The
procedure for capitalizing and expensing of assets will follow the Medicare
Regulations. "If a depreciable asset has at the time of its acquisition an
estimated useful life of at least two years and a cost of at least $500.00, the
asset must be capitalized and written off readably over the estimated useful
life of the asset. If the cost of the asset (including taxes and shipping) is
less than $500.00, or if the asset has a useful life of less than two years, its
cost will be expensed in the year of acquisition."

EX-3.60

                                                                    EXHIBIT 3.60


                            ARTICLES OF ORGANIZATION
                                       FOR
                        FLORIDA LIMITED LIABILITY COMPANY

                                   ARTICLE I.
                                      NAME

                  The name of the Limited Liability Company is: Heritage Care,
LLC.

                                   ARTICLE II.
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee, WI
53203

                                  ARTICLE III.
                     REGISTERED AGENT, REGISTERED OFFICE, &
                          REGISTERED AGENT'S SIGNATURE

                  The name and the Florida street address of the registered
agent are:

                          Lexis Document Services, Inc.
                               3953 WW Kelley Road
                              Tallahassee, FL 32311

EX-3.61

                                                                    EXHIBIT 3.61


                            ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


                  The undersigned, desiring to form a limited liability Company,
under Chapter 1705 of the Ohio Revised Code, do hereby state the following:

                  FIRST: The name of said limited liability company shall be:
Hilliard Care, LLC.

                  SECOND: This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD: The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.62

                                                                    EXHIBIT 3.62

                          ARTICLES OF ORGANIZATION FOR
                       FLORIDA LIMITED LIABILITY COMPANY


                                    ARTICLE I
                                      NAME

                  The name of the Limited Liability Company is: Jackson Heights
Rehabilitation Center, LLC.

                                   ARTICLE II
                                     ADDRESS


        The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee,
Wisconsin 53203.

                                   ARTICLE III
                                    DURATION

                  The period of duration for the Limited Liability Company shall
be: Unlimited/Perpetual.

                                   ARTICLE IV
                                   MANAGEMENT

                  The Limited Liability Company is to be managed by the members
and the name and address of the managing member is: Extendicare Homes, Inc., 111
West Michigan Street, Milwaukee, Wisconsin 53203.

                                    ARTICLE V
                         ADMISSION OF ADDITIONAL MEMBERS

                  The right, if given, of the members to admit additional
members and the terms and conditions of the admissions shall be: N/A.

                                   ARTICLE VI
                       MEMBERS RIGHTS TO CONTINUE BUSINESS

                  The right, if given, of the remaining members of the limited
liability company to continue the business on the death, retirement,
resignation, expulsion, bankruptcy, or dissolution of a member or the occurrence
of any other event which terminates the continued membership of a member in the
limited liability company shall be: None.

EX-3.63

                                                                    EXHIBIT 3.63

                          ARTICLES OF ORGANIZATION FOR
                       FLORIDA LIMITED LIABILITY COMPANY


                                    ARTICLE I
                                      NAME

                  The name of the Limited Liability Company is: Jacksonville
Care, LLC.

                                   ARTICLE II
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee,
Wisconsin 53203.

                                   ARTICLE III
                                    DURATION

                  The period of duration for the Limited Liability Company shall
be: Unlimited/Perpetual.

                                   ARTICLE IV
                                   MANAGEMENT

                  The Limited Liability Company is to be managed by the members
and the name and address of the managing member is: Northern Health Facilities,
Inc., 111 West Michigan Street, Milwaukee, Wisconsin 53203.

                                    ARTICLE V
                         ADMISSION OF ADDITIONAL MEMBERS

                  The right, if given, of the members to admit additional
members and the terms and conditions of the admissions shall be: N/A.

                                   ARTICLE VI
                       MEMBERS RIGHTS TO CONTINUE BUSINESS

                  The right, if given, of the remaining members of the limited
liability company to continue the business on the death, retirement,
resignation, expulsion, bankruptcy, or dissolution of a member or the occurrence
of any other event which terminates the continued membership of a member in the
limited liability company shall be: None.

EX-3.64

                                                                    EXHIBIT 3.64

                            ARTICLES OF ORGANIZATION
                                       FOR
                            KAUFMAN STREET WV, LLC

                                   ARTICLE 1.
                                  ORGANIZATION

                  The limited liability company is organized under Chapter 183
of the Wisconsin Statutes.

                                   ARTICLE 2.
                                      NAME

                  The name of the limited liability company shall be Kaufman
Street WV, LLC.

                                   ARTICLE 3.
                           REGISTERED OFFICE AND AGENT

                  The registered office of the limited liability company is 111
W. Michigan Street, Milwaukee, Wisconsin 53203, and the registered agent at such
office is Roch Carter.

                                   ARTICLE 4.
                                   MANAGEMENT

                  Management of the limited liability company is vested in its
member(s).

                                   ARTICLE 5.
                                  ORGANIZATION

                  The name and address of the Organizer is Lori A. Henley, Esq.,
Corporate Counsel, Extendicare Health Services, Inc., 111 W. Michigan Street,
Milwaukee, Wisconsin 53203.

EX-3.65

                                                                    EXHIBIT 3.65

                          ARTICLES OF ORGANIZATION FOR
                       FLORIDA LIMITED LIABILITY COMPANY


                                    ARTICLE I
                                      NAME

                  The name of the Limited Liability Company is:  Kissimmee Care,
LLC.

                                   ARTICLE II
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee,
Wisconsin 53203.

                                   ARTICLE III
                                    DURATION

                  The period of duration for the Limited Liability Company shall
be: Unlimited/Perpetual.

                                   ARTICLE IV
                                   MANAGEMENT

                  The Limited Liability Company is to be managed by the members
and the name and address of the managing member is: Northern Health Facilities,
Inc., 111 West Michigan Street, Milwaukee, Wisconsin 53203.

                                    ARTICLE V
                         ADMISSION OF ADDITIONAL MEMBERS

                  The right, if given, of the members to admit additional
members and the terms and conditions of the admissions shall be: N/A.

                                   ARTICLE VI
                       MEMBERS RIGHTS TO CONTINUE BUSINESS

                  The right, if given, of the remaining members of the limited
liability company to continue the business on the death, retirement,
resignation, expulsion, bankruptcy, or dissolution of a member or the occurrence
of any other event which terminates the continued membership of a member in the
limited liability company shall be: None.

                                   ARTICLE VII
                    AFFIDAVIT OF MEMBERSHIP AND CONTRIBUTIONS

                  The undersigned member or authorized representative of a
member of Kissimmee Care, LLC certifies:






                  1.   the above named limited liability company has at least
                       one member;

                  2.   the total amount of cash contributed by the member(s) is
                       $1,000;

                  3.   if any, the agreed value of property other than cash
                       contributed by member(s) is $0.00 (A description of the
                       property is attached and made a part hereto.); and

                  4.   the total amount of cash and property contributed and
                       anticipated to be contributed by member(s) is $1,000.



                                       2

EX-3.66

                                                                    EXHIBIT 3.66



                            ARTICLES OF ORGANIZATION
                                       FOR
                        FLORIDA LIMITED LIABILITY COMPANY

                                   ARTICLE I.
                                      NAME

                  The name of the Limited Liability Company is: Lady Lake Care,
LLC.

                                  ARTICLE II.
                                    ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee, WI
53203

                                  ARTICLE III.
                     REGISTERED AGENT, REGISTERED OFFICE, &
                          REGISTERED AGENT'S SIGNATURE

                  The name and the Florida street address of the registered
agent are:

                          Lexis Document Services, Inc.
                               3953 WW Kelley Road
                              Tallahassee, FL 32311

EX-3.67

                                                                    EXHIBIT 3.67






                            ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


                  The undersigned, desiring to form a limited liability Company,
under Chapter 1705 of the Ohio Revised Code, do hereby state the following:

                  FIRST: The name of said limited liability company shall be:
London Care, LLC.

                  SECOND: This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD: The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.68

                                                                    EXHIBIT 3.68






                            ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


                  The undersigned, desiring to form a limited liability Company,
under Chapter 1705 of the Ohio Revised Code, do hereby state the following:

                  FIRST: The name of said limited liability company shall be:
Marietta Care, LLC.

                  SECOND: This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD: The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.69

                                                                    EXHIBIT 3.69

                            ARTICLES OF INCORPORATION
                                       OF
                            MARSHALL PROPERTIES, INC.

                    -----------------------------------------

                  The undersigned, desiring to form a corporation for profit
(hereinafter referred to as the "Corporation") in accordance with Chapter 1701
of the Ohio Revised Code (hereinafter referred to as the "ORC") hereby states as
follows:

                  1. Name. The name of the Corporation is Marshall Properties,
Inc.

                  2. Principal Office. The place in the State of Ohio where the
principal office of the Corporation is to be located is in the City of Toledo,
County of Lucas.

                  3. Purposes. The purposes for which the Corporation is formed
is to engage in any lawful act or activity for which corporations may be formed
under Sections 1701.01 to 1701.98, inclusive of the ORC.

                  4. Authorized Shares. The total number of shares that the
Corporation is authorized to have issued and outstanding is (i) Nine Hundred
Fifty (950) Class A Common Shares, without par value, and (ii) Fifty (50) Class
B Common Shares, without par value. The rights and privileges of the Class A
Common Shares and the Class B Common Shares shall not be entitled to vote at any
meeting of the shareholders of the Corporation for the election of directors or
for any other purpose of otherwise to participate in any action taken by the
Corporation or the shareholders of the Corporation, or to receive notice of any
meeting of the shareholders of the Corporation.

                  5. Purchase of Securities. The Board of Directors of the
Corporation, without action by the shareholders, is hereby authorized to use and
apply the Corporation's surplus, however created or arising, or any part
thereof, at any time or from time to time in the purchase of acquisition of
shares of any class of the Corporation, voting trust certificates for shares of
the Corporation, bonds, debentures, notes, scrip, warrants, obligations,
evidences of indebtedness of the Corporation or other securities of the
Corporation, to such extent or amount and in such manner and upon such terms as
the Board of Directors of the Corporation shall deem expedient to the extent not
prohibited by law.

                  6.1. The Corporation shall be a "sole asset entity" as
required by the Secretary of Housing and Urban Development, whose sole asset
shall be Arbors at Milford located at 5900 Meadowcreek Drive, Milford, Clemont
County, Ohio ("Project").

                  6.2. The Corporation shall not be voluntarily dissolved prior
to December 31, 2046.

                  6.3. Notwithstanding anything else to the contrary stated in
the Articles of Incorporation, the Corporation shall not indemnify any Person
except to the extent mandated by state law and/or to the extent that such
indemnification is limited to liability insurance coverage or distribution
approved by HUD from residual receipts or surplus cash.





                  6.4 Notwithstanding any other provision in the Articles of
Incorporation to the contrary, as long as the Secretary of the Department of
Housing and Urban Development ("Secretary") or the Secretary's successors or
assigns is the insurer or holder of the note secured by the mortgage on the
Project, no amendment to the Articles of Incorporation that result in any of the
following will have any force or effect without the prior written consent of the
Secretary:

                  (a)      Any amendment that modifies the term of the
                           Corporation's existence;

                  (b)      Any amendment that activates the requirement that a
                           HUD Previous Participation Certification be obtained
                           from any additional Shareholder or other Person;

                  (c)      Any amendment that in any way affects the note,
                           mortgage, or security agreement on the Project or the
                           Regulatory Agreement between HUD and the Corporation
                           (the "Regulatory Agreement");

                  (d)      Any amendment that would authorize any Person other
                           than the previously authorized officers to bind the
                           Corporation for all matters concerning the Project
                           with required HUD's consent or approval;

                  (e)      A change in the voting control of the Shareholder(s)
                           of the Corporation;

                  (f)      Any change in the guarantor(s) of the obligation to
                           the Secretary; or

                  (g)      Any amendment to these Articles of Incorporation.

                  6.5. Authority of Corporation. The Corporation is authorized
to execute a note, mortgage and security agreement in order to secure a loan to
be insured by the Secretary and to execute the Regulatory Agreement and other
documents required in connection with the HUD-insured loan.

                  6.6. Issuance of New Shares. No shares shall be issued with at
least a 25% voting control unless the holder of such shares shall meet the
applicable requirements for HUD previous participation clearance. Any such new
Shareholder shall, as a condition of receiving an interest in the Corporation,
agree to be bound by the note, mortgage, security agreement, the Regulatory
Agreement, and any other documents required in connection with the HUD-insured
loan to the same extent and on the same terms as the other Shareholders.

                  6.7. Transfers Upon Dissolution. Notwithstanding any other
provisions of these Articles of Incorporation, upon any dissolution, no title,
or right to possession and control of the Project, and no right to collect the
rents from the Project, shall pass to any Person who is not bound by the
Regulatory Agreement in a manner satisfactory to the Secretary.

                  6.8. Conflicts With Note or Regulatory Agreement.
Notwithstanding any other provisions of the Articles of Incorporation, if any of
the provisions of the organizational documents conflict with the terms of the
note, mortgage, deed of trust or security deed, security agreement, HUD
Regulatory Agreement or other documents that may be required by HUD (the "HUD
Loan Documents"), the provisions of the HUD Loan Documents shall control.



                                       2



                  6.9. No Voluntary Dissolution. So long as the Secretary's
successors or assigns is the insurer or holder of the note on the Project, the
Corporation may not voluntarily be dissolved or disassociated or changed to
another type of entity without the prior written approval of the Secretary, and
any Shareholder may not be voluntarily changed to a limited liability company or
partnership.

                  6.10. Personal Liability. The Shareholder(s), and any assignee
of a Shareholder, agree to be liable in their individual capacities to HUD with
respect to the following matters:

                  (a)      For funds or property of the Project coming into
                           their hands, which by the provisions of the
                           Regulatory Agreement, they are not entitled to
                           retain; and

                  (b)      For their own acts and deeds, or acts and deeds of
                           others which they have authorized, in violation of
                           the provisions of the Regulatory Agreement.

                  (c)      For their acts which violate statutes governing the
                           conduct of owners of multifamily projects with
                           FHA-insured mortgages.

                  6.11. Corporation Representatives. Each Officer is authorized
to represent and bind the Corporation with respect to all matters concerning the
Project which require the consent or approval of the Secretary. The signature of
any one Officer shall bind the Corporation in all such matters. If the
Corporation representatives under this article XIII are changed at any time, the
Corporation shall provide the Secretary with written notification of the name,
address and telephone number of the new representative(s) within three (3)
business days of such change.







                                       3

EX-3.70

                                                                    EXHIBIT 3.70

                               CODE OF REGULATIONS

                                       OF

                            MARSHALL PROPERTIES, INC.

                     --------------------------------------

                                   ARTICLE I
                                    OFFICES

                  Section 1. Principal Office. The principal office of the
corporation shall be at such place in the City of Lima, Ohio, as may be
designated from time to time by the Board of Directors.

                  Section 2. Other Offices. The corporation shall also have
offices at such other places within, as well as without, the State of Ohio as
the Board of Directors may from time to time determine.

                                   ARTICLE II
                            MEETINGS OF SHAREHOLDERS

                  Section 1. Annual Meeting. The annual meeting of the
shareholders of this corporation for the purpose of fixing or changing the
number of directors of the corporation, electing directors and transacting such
other business as may properly come before the meeting, shall be held on the
first Monday of the fourth month following the close of each fiscal year of the
corporation, if not a legal holiday, but if a legal holiday, then on the next
business day following, or on such other day or date as shall be designated by
the Board of Directors.

                  Section 2. Special Meetings. Special meetings of the
shareholders may be called at any time by the President or a Vice President, a
majority of the Board of Directors acting with or without a meeting, or the
holder or holders of one-fourth of all shares outstanding and entitled to vote
thereat.

                  Section 3. Place of Meetings. Meetings of shareholders shall
be held at the office of the corporation in the City of Lima, Ohio, unless the
Board of Directors decides that a meeting shall be held at some other place
within or without the State of Ohio and causes the notice thereof to so state.

                  Section 4. Notice of Meetings. Unless waived, a written,
printed or typewritten notice of each annual or special meeting stating the day,
hour and place and the purpose or purposes thereof shall be served upon or
mailed to each shareholder of record entitled to notice of the meeting (a) as of
the day next preceding the day on which notice is given or (b) if a record date
therefor is duly fixed, of record as of said date. Such notice shall be given
not more than sixty (60) days nor less than seven (7) days before any such
meeting. If mailed, it shall be directed to a shareholder at his address as the
same appears upon the records of the corporation.





                  All notices with respect to any shares of record in the names
of two or more persons may be given to whichever of such persons is named first
on the books of the corporation and notice so given shall be effective as to all
the holders of record of such shares.

                  Every person who by operation of law, transfer, or otherwise
shall become entitled to any share or right or interest therein shall be bound
by every notice in respect of such share that, prior to his name and address
being entered upon the books of the corporation as the registered holder of such
share, shall have been given to the person in whose name such share appeared of
record.

                  Section 5. Waiver of Notice. Any shareholder, either before or
after any meeting, may waive any notice required to be given by law or under
these Regulations; and whenever all of the shareholders entitled to vote shall
meet in person or by proxy and consent to holding a meeting, it shall be valid
for all purposes without call or notice, and at such meeting any action may be
taken.

                  Section 6. Quorum. The shareholders present in person or by
proxy at any meeting for the determination of the number of directors, or the
election of directors, or for the consideration and action upon reports,
required to be laid before such meeting, shall constitute a quorum.

                  At any meeting called for any other purpose, the holders of
shares entitling them to exercise a majority of the voting power of the
corporation, present in person or represented by proxy, shall constitute a
quorum, except when a greater proportion is required by law, the Articles of
Incorporation or these Regulations.

                  At any meeting at which a quorum is present, all questions and
business that shall come before the meeting shall be determined by the vote of
the holders of a majority of such voting shares as are represented in person or
by proxy, except when a greater proportion is required by law, these
Regulations, or the Articles of Incorporation.

                  At any meeting, whether a quorum is present or not, the
holders of a majority of the voting shares represented by shareholders present
in person or by proxy may adjourn from time to time and from place to place
without notice other than by announcement at the meeting. At any such adjourned
meeting at which a quorum is present, any business may be transacted which might
be transacted at the meeting as originally notified or held.

                  Section 7. Voting. At any meeting of shareholders, each
shareholder of the corporation shall, except as otherwise provided by law or by
the Articles of Incorporation or by these Regulations, be entitled to one vote
in person or by proxy for each share of the corporation registered in his name
on the books of the corporation (1) on the date fixed pursuant to subparagraph
(f) of Section 2 of Article IV of these Regulations as the record date for the
determination of shareholders entitled to vote at such meeting, notwithstanding
the prior or subsequent sale, or other disposal of such share or shares or
transfer of the sane on the books of the corporation on or after the date so
fixed, or (2) if no such record date shall have been fixed, then at the time of
such meeting.




                  Section 8. Financial Reports. At the annual meeting of
shareholders, or the meeting held in lieu thereof, there shall be laid before
the shareholders a financial statement consisting of: (1) a balance sheet
containing a summary of the assets, liabilities, stated capital, and surplus
(showing separately any capital surplus arising from unrealized appreciation of
assets, other capital surplus, and earned surplus) of the corporation as of a
date not more than four (4) months before such meeting; if such meeting is an
adjourned meeting, said balance sheet may be as of a date not more than four (4)
months before the date of the meeting as originally convened; and (2) a
statement of profit and loss and surplus, including a summary of profits,
dividends paid, and other changes in the surplus accounts of the corporation for
the period commencing with the date marking the end of the period for which the
last preceding statement of profit and loss under this section was made and
ending with the date of said balance sheet. An opinion signed by the President
or a Vice President or the Treasurer or an Assistant Treasurer, or by a public
accountant or firm of public accountants, shall be appended to such financial
statement, stating that the financial statement presents fairly the
corporation's financial position and the results of its operations in conformity
with generally accepted accounting principles applied on a basis consistent with
that of the preceding period, or such other opinion as is in accordance with
sound accounting practice.

                  Section 9. Action Without Meeting. Any action which may be
authorized or taken at any meeting of shareholders may be authorized or taken
without a meeting in a writing or writings signed by all of the holders of
shares who would be entitled to notice of a meeting of the shareholders held for
such purpose. Such writing or writings shall be filed with or entered upon the
records of the corporation.

                                  ARTICLE III
                                   DIRECTORS

                  Section 1. Number of Directors. The number of authorized
Directors of the Corporation shall be not less than 1 nor more than 15, fixed
from time to time by the Shareholder. The Directors shall be elected at the
annual meeting of the Shareholders and each Director shall be elected to serve
until his successor shall be elected and shall qualify.

                  Section 2. Election of Directors. Directors shall be elected
at the annual meeting of shareholders, but when the annual meeting is not held
or directors are not elected thereat, they may be elected at a special meeting
called and held for that purpose. Such election shall be by ballot whenever
requested by any shareholder entitled to vote at such election; but, unless such
a request is made, the election may be conducted in any manner approved at such
meeting.

                  At each meeting of shareholders for the election of directors,
the persons receiving the greatest number of votes shall be directors.

                  Section 3. Term of Office. Directors shall hold office until
the annual meeting next succeeding their election and until their successors are
elected and qualified.

                  Section 4. Vacancies. Vacancies in the Board of Directors may
be filled by a majority vote of the remaining directors until an election to
fill such vacancies is had.





Shareholders entitled to elect directors shall have the right to fill any
vacancy in the board (whether the same has been temporarily filled by the
remaining directors or not) at any meeting of the shareholders called for that
purpose, and any directors elected at any such meeting of shareholders shall
serve until the next annual election of directors and until their successors are
elected and qualified.

                                   ARTICLE IV
                  POWERS, MEETINGS, COMPENSATION, AND CONFLICTS
                                  OF DIRECTORS

                  Section 1. General Powers of Board. The powers of the
corporation shall be exercised, its business and affairs conducted, and its
property controlled by the Board of Directors, except as otherwise provided in
the Articles of Incorporation, amendments thereto, or the Ohio General
Corporation Law.

                  Section 2. Other Powers. Without prejudice to the general
powers conferred by or implied in the preceding section, the directors, acting
as a Board, shall have powers:

                  (a) To fix, define and limit the powers and duties of all
officers and to fix the salaries of all officers;

                  (b) To appoint, and at their discretion, with or without
cause, to remove, or suspend, such subordinate officers, assistants, managers,
agents and employees as the directors may from time to time deem advisable, and
to determine their duties and fix their compensation;

                  (c) To require any officer, agent or employee of the
corporation to furnish a bond for faithful performance in such amount and with
such sureties as the Board may approve;

                  (d) To designate a depositary or depositaries of the funds of
the corporation and the officer or officers or other persons who shall be
authorized to sign notes, checks, drafts, contracts, deeds, mortgages and other
instruments on behalf of the corporation;

                  (e) To appoint and remove transfer agents and/or registrars
for the corporation's shares;

                  (f) To fix a time not exceeding sixty days preceding the date
of any meeting of shareholders, or the date fixed for the payment of any
dividend or distribution, or the date for the allotment of rights, or (subject
to contract rights with respect thereto) the date when any change or conversion
or exchange of shares shall be made or go into effect, as a record date for the
determination of the shareholders entitled to notice of and to vote at any such
meeting, or entitled to receive payment of any such dividend, distribution, or
allotment of rights, or to exercise the rights in respect to any such change,
conversion or exchange of shares, and, in such case, only the persons who are
shareholders of record on the date so fixed shall be entitled to notice of and
to vote at such meeting, or to receive payment of such dividend, distribution,
or allotment of rights, or to exercise such rights, as the case may be,
notwithstanding any transfer of any shares on the books of the corporation after
any record date fixed as aforesaid, or change of ownership of any shares either
before or after such record date, and such persons shall conclusively be deemed
to be the shareholders of the corporation on such record date,




notwithstanding notice or knowledge to the contrary; and the Board of Directors
may close the books of the corporation against transfer of shares during the
whole or any part of such period; and

                  (g) To establish such rules and regulations respecting the
issuance and transfer of shares and certificates for shares as the Board of
Directors may consider reasonable.

                  Section 3. Meetings of the Board. A meeting of the Board of
Directors shall be held immediately following the adjournment of each
shareholders' meeting at which directors are elected, and notice of such meeting
need not be given. The Board of Directors may, by by-laws or resolution, provide
for other meetings of the Board.

                  Special meetings of the Board of Directors may be held at any
time upon call of the President, a Vice President, or any two members of the
Board. Notice of any special meeting of the Board of Directors shall be mailed
to each director, addressed to him at his residence or usual place of business,
at least five (5) days before the day on which the meeting is to be held, or
shall be sent to him at such place by telegram or the equivalent, or be given
personally or by telephone, not later than the day before the day on which the
meeting is to be held. Every such notice shall state the time and place of the
meeting but need not state the purposes thereof. Notice of any meeting of the
Board need not be given to any director, however, if waived by him in writing or
by telegram or the equivalent, whether before or after such meeting be held, or
if he shall be present at such meeting; and any meeting of the Board shall be a
legal meeting without any notice thereof having been given if all the directors
shall be present thereat.

                  All meetings of the Board shall be held at the office of the
corporation in the City of Lima, Ohio, or at such other place, within or without
the State of Ohio, as the Board may determine from time to time and as may be
specified in the notice thereof.

                  Section 4. Quorum. A majority of the Board of Directors shall
constitute a quorum for the transaction of business, provided that whenever less
than a quorum is present at the time and place appointed for any meeting of the
Board, a majority of those present may adjourn the meeting from time to time,
without notice other than by announcement at the meeting, until a quorum shall
be present.

                  Section 5. Action without Meeting. Any action which may be
authorized or taken at a meeting of the directors may be authorized or taken
without a meeting in a writing or writings signed by all the directors, which
writing or writings shall be filed with or entered upon the records of the
corporation.

                  Section 6. Compensation. The directors, as such, shall not
receive any salary for their services, but by resolution of the Board, a fixed
sum and expenses of attendance, if any, may be allowed for attendance at each
regular or special meeting of the Board; provided that nothing herein contained
shall be construed to preclude any director from serving the corporation in any
other capacity and receiving compensation therefor. Members of the executive
committee or of any standing or special committee may by resolution of the Board
be allowed such compensation for their services as the Board may deem
reasonable, and additional compensation may be allowed to directors for special
services rendered.






                  Section 7. Conflicts. A director of this corporation shall not
be disqualified by his office from dealing or contracting with the corporation
as a vendor, purchaser, employee, agent, attorney, or otherwise, nor shall any
transaction or contract or act of this corporation be void or voidable or in any
way affected or invalidated by reason of the fact that any director, or any firm
of which any director is a number, or any corporation of which any director is a
shareholder, officer, or director, is in any way interested in such transaction
or contract or act, provided the fact that such director or such firm or such
corporation is so interested shall be disclosed or shall be known to the Board
of Directors or such members thereof as shall be present at any meeting of the
Board of Directors at which action upon any such contract or transaction or act
shall be taken. No such director shall be accountable to or responsible to the
corporation for or in respect to any such transaction or contract or act of this
corporation or for any gains or profits realized by him by reason of the fact
that he, or any firm of which he is a member, or any corporation of which he is
a shareholder, officer, or director, is interested in such transaction or
contract or act. Any director may be counted in determining the existence of a
quorum at any meeting of the Board of Directors that shall authorize or take
action in respect to any such contract or transaction or act, and may vote
thereat to authorize, ratify, or approve any such contract or transaction or
act. Any officer of the corporation may take any action within the scope of his
authority respecting any such contract or transaction or act with like force and
effect as if he or any firm of which he is a member or any corporation of which
he is a shareholder, officer, or director were not interested in such
transaction or contract or act. Without limiting or qualifying the foregoing, if
in any judicial or other inquiry, suit, cause or proceeding, the question of
whether a director or officer of the corporation has acted in good faith is
material, then notwithstanding any statute or rule of law or of equity to the
contrary (if any there be), his good faith shall be presumed in the absence of
proof to the contrary by clear and convincing evidence.

                  Section 8. Indemnification. Each person who at any time is or
shall have been a director, officer, employee or agent of the corporation, or is
or shall have been serving at the request of the corporation as a director,
trustee, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, and his or her heirs, executors and
administrators, shall be indemnified by the corporation against any cost or
expense reasonably incurred by him or her in connection with any threatened,
pending, or completed action, suit or proceeding by reason of such service to or
for the corporation in accordance with and to the full extent permitted by the
Ohio General Corporation Law (Ohio Rev. Code ss.1701.13(E)) as in effect at the
time of the adoption of these Regulations or as amended from time to time
thereafter. The foregoing right of indemnification shall not be deemed exclusive
of other rights to which any director, officer, employee, agent or other person
may be entitled in any capacity as a matter of law or under any regulation,
agreement, vote of directors or otherwise. The corporation, its directors,
officers, employees and agents shall be fully protected in taking any action or
making any payment under this section, or in refusing so to do, in reliance upon
the advice of counsel. If authorized by the Board of Directors, the corporation
may purchase and maintain insurance against liability on behalf of any such
person to the full extent permitted by law in effect at the time of the adoption
of these Regulations or as changed from time to time.

                  Section 9. Reliance on Books and Records. Each officer,
director or member of any committee designated by the Board of Directors of the
corporation shall, in the




performance of his duties, be fully protected in relying in good faith upon the
books of account or reports made to the corporation by any of its officials or
by an independent public accountant or by an appraiser selected with reasonable
care by the Board of Directors of the corporation or by any such committee or in
relying in good faith upon other records of the corporation.

                  Section 10. By-Laws. For the government of its actions, the
Board of Directors may adopt regulations consistent with the Articles of
Incorporation and these Regulations.

                  Section 11. Committees. The Board of Directors may by
resolution provide for such standing or special committees as it deems
desirable, and discontinue the same at pleasure. Each such committee shall have
such powers and perform such duties, not inconsistent with law, as may be
delegated to it by the Board of Directors. Vacancies in such committees shall be
filled by the Board of Directors or as it may provide.

                                   ARTICLE V
                                    OFFICERS

                  Section 1. General Provisions. The Board of Directors shall
elect a President, such number of Vice Presidents as the Board may from time to
time determine, a Secretary and Treasurer, and, in its discretion, a Chairman of
the Board of Directors. The Board of Directors may from time to time create such
offices and appoint such other officers, subordinate officers and assistant
officers as it may determine. Any two or more of such offices, other than that
of President and Vice President, Secretary and Assistant Secretary, or Treasurer
and Assistant Treasurer, may be held by the same person, but no officer shall
execute, acknowledge or verify any instrument in more than one capacity.

                  Section 2. Term of Office. The officers of the corporation
shall hold office during the pleasure of the Board of Directors, and unless
sooner removed by the Board of Directors, until the reorganization meeting of
the Board of Directors following the date of their election and until their
successors are chosen and qualified. The Board of Directors may remove any
officer at any time, with or without cause, by a majority vote. A vacancy in any
office, however created, shall be filled by the Board of Directors.

                                   ARTICLE VI
                               DUTIES OF OFFICERS

                  Section 1. Chairman of the Board. The Chairman of the Board,
if one be elected, shall preside at all meetings of the Board of Directors and
shall have such other powers and duties as may be prescribed by the Board of
Directors.

                  Section 2. President. The President shall be the chief
executive officer of the corporation and shall exercise supervision over the
business of the corporation and over its several officers, subject, however, to
the control of the Board of Directors. He shall preside at all meetings of
shareholders and, in the absence of, or if a Chairman of the Board shall not
have been elected, shall also preside at meetings of the Board of Directors. He
shall have authority to sign all certificates for shares and all deeds,
mortgages, bonds, contracts, notes and other instruments requiring his
signature; and shall have all the powers and duties prescribed by the





Ohio general corporation law and such others as the Board of Directors may from
time to time assign to him.

                  Section 3. Vice Presidents. The Vice Presidents shall perform
such duties as are conferred upon them by these regulations or as may from time
to time be assigned to them by the Board of Directors or the President. At the
request of the President, or in his absence or disability, the Vice President,
designated by the President (or in the absence of such designation, the Vice
President designated by the Board), shall perform all the duties of the
President, and when so acting, shall have all the powers of the President. The
authority of Vice Presidents to sign in the name of the corporation all
certificates for shares and authorized deeds, mortgages, bonds, contracts, notes
and other instruments, shall be coordinate with like authority of the President.
Any one or more of the Vice Presidents may be designated as an "Executive Vice
President."

                  Section 4. Secretary. The Secretary shall keep minutes of all
the proceedings of the shareholders and Board of Directors, and shall make
proper record of the same, which shall be attested by him; sign all certificates
for shares, and all deeds, mortgages, bonds, contracts, notes, and other
instruments executed by the corporation requiring his signature; give notice of
meetings of shareholders and directors; produce on request at each meeting of
shareholders for the election of directors a certified list of shareholders
arranged in alphabetical order; keep such books as may be required by the Board
of Directors, and file all reports to States, to the Federal Government, and to
foreign countries; and perform such other and further duties as may from time to
time be assigned to him by the Board of Directors or by the President.

                  Section 5. Treasurer. The Treasurer shall have general
supervision of all finances; he shall receive and have in charge all money,
bills, notes, deeds, leases, mortgages and similar property belonging to the
corporation, and shall do with the same as may from time to time be required by
the Board of Directors. He shall cause to be kept adequate and correct accounts
of the business transactions of the corporation, including accounts of its
assets, liabilities, receipts, disbursements, gains, losses, stated capital, and
shares, together with such other amounts as may be required, and, upon the
expiration of his term of office, shall turn over to his successor or to the
Board of Directors all property, books, papers and money of the corporation in
his hands; and he shall perform such other duties as from time to time may be
assigned to him by the Board of Directors.

                  Section 6. Assistant and Subordinate Officers. The Board of
Directors may appoint such assistant and subordinate officers as it may deem
desirable. Each such officer shall hold office during the pleasure of the Board
of Directors, and perform such duties as the Board of Directors may prescribe.
The Board of Directors may, from time to time, authorize any officer to appoint
and remove assistant and subordinate officers, to prescribe their authority and
duties, and to fix their compensation.

                  Section 7. Duties of Officers may be Delegated. In the absence
of any officer of the corporation, or for any other reason the Board of
Directors may deem sufficient, the Board of Directors may delegate, for the time
being, the powers or duties, or any of them, of such officer to any other
officer, or to any director.





                                  ARTICLE VII
                             CERTIFICATES FOR SHARES

                  Section 1. Form and Execution. Certificates for shares shall
be issued to each shareholder in such form as shall be approved by the Board of
Directors. Such certificates shall be signed by the Chairman of the Board of
Directors or the President or a Vice President and by the Secretary or an
Assistant Secretary or the Treasurer or an Assistant Treasurer of the
corporation, which certificates shall certify the number and class of shares
held by the shareholder in the corporation, but no certificate for shares shall
be delivered until such shares are fully paid. When such a certificate is
countersigned by an incorporated transfer agent or registrar, the signature of
any of said officers of the corporation may be facsimile, engraved, stamped or
printed. Although any officer of the corporation whose manual or facsimile
signature is affixed to a share certificate shall cease to be such officer
before the certificate is delivered, such certificate, nevertheless, shall be
effective in all respects when delivered.

                  Such certificate for shares shall be transferable in person or
by attorney, but, except as hereinafter provided in the case of lost, mutilated
or destroyed certificates, no transfer of shares shall be entered upon the
records of the corporation until the previous certificate, if any, given for the
same shall have been surrendered and canceled.

                  Section 2. Lost, Mutilated or Destroyed Certificates. If any
certificate for shares is lost, mutilated or destroyed, the Board of Directors
may authorize the issue of a new certificate in place thereof upon such terms
and conditions as it may deem advisable. The Board of Directors in its
discretion may refuse to issue such new certificates until the corporation has
been indemnified to its satisfaction and until it is protected to its
satisfaction by a final order or decree of a court of competent jurisdiction.

                  Section 3. Registered Shareholders. A person in whose name
shares are of record on the books of the corporation shall conclusively be
deemed the unqualified owner thereof for all purposes and to have capacity to
exercise all rights of ownership. Neither the corporation nor any transfer agent
of the corporation shall be bound to recognize any equitable interest in or
claim to such shares on the part of any other person, whether disclosed upon
such certificate or otherwise, nor shall they be obliged to see to the execution
of any trust or obligation.

                                  ARTICLE VIII
                                   FISCAL YEAR

                  The fiscal year of the corporation shall be designated by the
first Federal Income Tax Return filed by the corporation, or on such other day
as may be fixed from time to time by the Board of Directors.

                                   ARTICLE IX
                                      SEAL

                  The Board of Directors may, in its discretion, provide a
suitable seal containing the name of the corporation. If deemed advisable by the
Board of Directors, duplicate seals may be provided and kept for the purposes of
the corporation.




                                   ARTICLE X
                                   AMENDMENTS

                  These By-Laws may be altered or repealed and By-Laws may be
made at any annual meeting of the stockholders or at any special meeting thereof
if notice of the proposed alteration or repeal or By-Law or By-Laws to be made
be contained in the notice of such special meeting, by the affirmative vote of a
majority of the stock issued and outstanding and entitled to vote thereat, or by
the affirmative vote of a majority of the Board of Directors, at any regular or
special meeting of the Board of Directors.

EX-3.71

                                                                    EXHIBIT 3.71


                       CERTIFICATE OF LIMITED PARTNERSHIP

         In compliance with the requirements of the Delaware Limited Partnership
Act, Title 6, Chapter 17 of the Delaware Code (relating to certificate of
limited partnership), the undersigned, desiring to form a limited partnership,
hereby certifies that:

1.       The name of the limited partnership is:     Meadow Care, LP

2.       The address of this limited partnership's initial registered office is:


         111 West Michigan Street,       Milwaukee,       WI              53203              Milwaukee
         -------------------------------------------------------------------------------------------------
            Number and Street              City          State             Zip                County



3.       The address of this limited partnership's registered agent upon whom
         process may be served is:


         Lexis Document Services Inc.
         30 Old Rudnick Lane, Suite 100,      Dover,        DE            19901             Kent
         --------------------------------------------------------------------------------------------------
             Number and Street                City         State           Zip            County



4.       The name and business address of each general partner of the
         partnership is:


         Name                               Address

         Coventry Care Holdings, Inc.       111 West Michigan Street, Milwaukee, WI  53203




5.       The formation of the limited partnership shall be effective upon filing
         this Certificate of Limited Partnership with the Office of the
         Secretary of State.

EX-3.72

                                                                    EXHIBIT 3.72


                           ARTICLES OF INCORPORATION
                                       OF
                               MEADOW CREST, INC.


                  In compliance with the requirements of section 294 of the
Wisconsin Business Corporation Law, act of May 5, 1933 (P. L. 364) (15 P. S. ss.
1204) the undersigned, desiring to be incorporated as a business corporation,
hereby certifies that:

                                    ARTICLE I

                  The name of the corporation is Meadow Crest, Inc.

                                   ARTICLE II

                  The location and post office address of the initial registered
office of the corporation in this Commonwealth is: 1277 Country Club Road,
Monongahela, Pennsylvania 15063.

                                   ARTICLE III

                  The corporation is incorporated under the Business Corporation
Law of the Commonwealth of Pennsylvania for the following purpose or purposes:

                  This corporation is organized under the Business Corporation
Law of 1933, approved May 5, 1933, P. L. 364, as amended to the date hereof. The
corporation shall have unlimited power to engage in and do any lawful act
concerning any or all lawful business for which corporations may be incorporated
under the aforesaid Business Corporation Law, as amended.

                                   ARTICLE IV

                  The term for which the corporation is to exist is perpetual.

                                    ARTICLE V

                  The aggregate number of shares which the corporation shall
have authority to issue is: One Hundred Thousand (100,000) shares of common
stock, without par value, the total stated value of which shall be $10,000.00.





                                   ARTICLE VI

                  The name and post office address of each incorporator and the
number and class of shares subscribed by such incorporator is:

                                                                  NUMBER AND
      NAME                         ADDRESS                      CLASS OF SHARES

 Harold A. Gold               805 Hillaire Drive                1 share common
                        Pittsburgh, Pennsylvania 15243



                                       2

EX-3.73

                                                                    EXHIBIT 3.73


                                    BY-LAWS

                                       OF

                               MEADOW CREST, INC.

                                    ARTICLE I
                                     OFFICES

                  The principal office of the corporation in the Commonwealth of
Pennsylvania shall be located in the Township of Mt. Lebanon, County of
Allegheny. The corporation may have such other offices, either within or without
the Commonwealth of Pennsylvania, as the Board of Directors may designate or as
the business of the corporation may require from time to time.

                                   ARTICLE II
                                  SHAREHOLDERS

                  Section 1. Annual Meeting. The annual meeting of the
shareholders shall be the fourth week of March per Shareholder Action dated
December 1, 1994 for the purpose of electing Directors and for the transaction
of such other business as may properly come before the meeting. If the day fixed
for the annual meeting shall be a legal holiday in the Commonwealth of
Pennsylvania, such meeting shall be held on the next succeeding business day. If
the election of Directors shall not be held on the day designated herein for any
annual meeting of the shareholders, or at any adjournment thereof, the Board of
Directors shall cause the election to be held at a special meeting of the
shareholders as soon thereafter as it conveniently may be held.

                  Section 2. Special Meetings. Special meetings of the
shareholders, for any purpose or purposes specified, unless otherwise prescribed
by statute, may be called by the President or by the Board of Directors, and
shall be called by the President at the written request of the holders of not
less than fifty-five (55%) percent of all the outstanding shares of the
corporation entitled to vote at the meeting.

                  Section 3. Place of Meeting. The Board of Directors may
designate any place, either within or without the Commonwealth of Pennsylvania
unless otherwise prescribed by statute, as the place of meeting for any annual
meeting or for any special meeting called by the Board of Directors. A waiver of
notice signed by all shareholders entitled to vote at a meeting may designate
any place, either within or without the Commonwealth of Pennsylvania, unless
otherwise prescribed by statute, as the place for the holding of such meeting.
If no designation is made, or if a special meeting be otherwise called, the
place of meeting shall be the registered office of the corporation in the
Commonwealth of Pennsylvania.

                  Section 4. Notice of Meeting. Written or printed notice
stating the place, day and hour of the meeting and, in case of a special
meeting, the purpose or purposes for which the meeting is called, shall be
delivered not less than five (5) nor more than thirty (30) days before the date
of the meeting, either personally or by mail, by or at the direction of the
President, or the Secretary, or the officer or persons calling the meeting, to
each shareholder of record entitled to vote at such meeting. If mailed, such
notice shall be deemed to be delivered when deposited in


the United States mail, addressed to the shareholder at his address as it
appears on the stock transfer books of the corporation, with postage thereon
prepaid.

                  Section 5. Voting Lists. The officer or agent having charge of
the stock transfer books for shares of the corporation shall make, on the record
date, which shall be at least five (5) days before each meeting of the
shareholders, a complete list of the shareholders entitled to vote at such
meeting, or any adjournment thereof, arranged in alphabetical order, with the
address of and the number of shares held by each, which list, for a period of
five (5) days prior to such meeting, shall be kept on file at the registered
office of the corporation and shall be subject to inspection by any shareholder
at any time during usual business hours. Such list shall also be produced and
kept open at the time and place of the meeting and shall be subject to the
inspection of any shareholder during the whole time of the meeting. The original
stock transfer book shall be prima facie evidence as to who are the shareholders
entitled to examine such list or transfer books or to vote at any meeting of
shareholders.

                  Section 6. Quorum. The holders of shares constituting a
majority of the total voting power of the outstanding shares of the corporation
entitled to vote as provided for in Section 8 of this Article II, represented in
person or by proxy, shall constitute a quorum for the transaction of business at
all meetings of the shareholders except as otherwise provided by statute, the
Articles of Incorporation or these by-laws. If less than a majority of the
voting power so described of the outstanding shares are represented at a
meeting, the majority of the voting power of the corporation so represented may
adjourn the meeting from time to time without further notice. At such adjourned
meeting at which a quorum shall be present or represented, any business may be
transacted which might have been transacted at the meeting as originally
notified. The shareholders present at a duly organized meeting may continue to
transact business until adjournment, notwithstanding the withdrawal of enough
shareholders to leave less than a quorum.

                  Section 7. Proxies. Every shareholder entitled to vote at a
meeting of shareholders or to express consent or dissent to corporate action in
writing without a meeting may authorize another person or persons to act for him
by proxy. Every proxy shall be executed in writing by the shareholder, or by his
duly authorized attorney in fact, and filed with the secretary of the
corporation. A proxy, unless coupled with an interest, shall be revocable at
will, notwithstanding any other agreement or any provision in the proxy to the
contrary, but the revocation of a proxy shall not be effective until notice
thereof has been given to the secretary, of the corporation. No unrevoked proxy
shall be valid after eleven months from the date of its execution, unless a
longer time is expressly provided therein, but in no event shall a proxy, unless
coupled with an interest, be voted on after three years from the date of its
execution.

                  Section 8. Voting of Shares. Subject to the provisions of
Section 10 of this Article II, each outstanding share of Common Stock entitled
to vote shall be entitled to one vote upon each matter submitted to a vote at a
meeting of shareholders.

                  Section 9. Voting of Shares by Certain Holders. Shares
standing in the name of another corporation may be voted by an officer, agent or
proxy of such corporation without a transfer of such shares into his name.
Shares standing in the name of a trustee may be voted by


him, either in person or by proxy, but no trustee shall be entitled to vote
shares held by him without a transfer of such shares into his name.

                  Shares standing in the name of a receiver may be voted by such
receiver, and shares held by or under the control of a receiver may be voted by
such receiver without the transfer thereof into his name if authority so to do
be contained in an appropriate order of the court by which such receiver was
appointed.

                  A shareholder whose shares are pledged shall be entitled to
vote such shares until the shares have been transferred into the name of the
pledgee, and thereafter the pledgee shall be entitled to vote the shares so
transferred.

                  Shares of its own stock belonging to the corporation or held
by it in a fiduciary capacity shall not be voted, directly or indirectly, at any
meeting, and shall not be counted in determining the total number of outstanding
shares at any given time.

                  Section 10. No Cumulative Voting. Unless otherwise provided
bylaw, at each election for Directors there shall be no cumulative voting and
every shareholder entitled to vote at such election shall have the right to
vote, in person or by proxy, the number of shares owned by him on the record
date according to the voting power which is provided for such shares in Section
8 of this Article II for as many persons as there are directors to be elected
and for whose election he has a right to vote.

                  Section 11. Informal Action by Shareholders. Unless otherwise
provided by law, any action which may be taken at a meeting of the shareholders,
may be taken without a meeting if a consent in writing, setting forth the action
so taken, shall be signed by all of the shareholders entitled to vote with
respect to the subject matter thereof.

                  Section 12. Order of Business. The order of business at the
annual meeting of the shareholders shall be as follows:

                  (a)      Calling meeting of shareholders to order;

                  (b)      Proof of notice of meeting;

                  (c)      Reading of minutes of last annual meeting;

                  (d)      Reports of officers;

                  (e)      Reports of committees;

                  (f)      Election of directors;

                  (g)      Miscellaneous business.




                                   ARTICLE III
                               BOARD OF DIRECTORS

                  Section 1. General Powers. The business and affairs of the
Corporation shall be managed by its Board of Directors.

                  Section 2. Number, Tenure and Qualifications. The number of
authorized Directors of the Corporation shall be not less than 1 nor more than
15, fixed from time to time by the Shareholder. The Directors shall be elected
at the annual meeting of the Shareholders and each Director shall be elected to
serve until his successor shall be elected and shall qualify.

                  Section 3. Regular Meetings. A regular meeting of the Board of
Directors shall be held without other notice than these By-Laws immediately
after, and at the same place, as the annual meeting of shareholders. The Board
of Directors may provide, by resolution, the time and place for the holding of
additional regular meetings without other notice than such resolution.

                  Section 4. Special Meetings. Special meetings of the Board of
Directors may be called by or at the request of the President and any two
directors. The person or persons authorized to call special meetings of the
Board of Directors may fix the place for holding any special meeting of the
Board of Directors called by them.

                  Section 5. Notice. Notice of any special meeting shall be
given at least twenty-four (24) hours previously thereto by written notice
delivered personally to each director at his business address, or by telegram.
If notice be given by telegram, such notice shall be deemed to be delivered when
the telegram is delivered to the telegraph company. Notice of any special
meeting may be given by mail and if mailed, such notice shall be deemed to be
delivered when deposited forty-eight hours prior to the meeting in the United
States mail so addressed, with postage thereon prepaid. Any director may waive
notice of any meeting. The attendance of director at a meeting shall constitute
a waiver of notice of such meeting, except where a director attends a meeting
for the express purpose of objecting to the transaction of any business because
the meeting is not lawfully called or convened.

                  Section 6. Quorum. A majority of the number of directors fixed
by Section 2 of this Article III shall constitute a quorum for the transaction
of business of any meeting of the Board of Directors, but if less than such
majority is present at a meeting, a majority of the directors present may
adjourn the meeting from time to time without further notice.

                  Section 7. Manner of Acting. The act of the majority of the
directors present at a meeting at which a quorum is present shall be the act of
the Board of Directors.

                  Section 8. Vacancies. Any vacancy, including my vacancy
resulting from an increase in the number of directors, occurring in the Board of
Directors may be filled by the affirmative vote of a majority of the remaining
directors though less than a quorum of the Board of Directors, unless otherwise
provided by law. A director elected to fill a vacancy shall be elected for the
unexpired term of his predecessor in office.




                  Section 9. Compensation. By resolution of the Board of
Directors, the Directors may be paid their expenses, if any, of attendance at
each meeting of the Board of Directors, and may be paid a fixed sum for
attendance at each meeting of the Board of Directors or a stated salary as
director. No such payment shall preclude any director from serving the
corporation in any other capacity and receiving compensation therefor.

                  Section 10. Presumption of Assent. A director of the
corporation who is present at a meeting of the Board of Directors at which
action on any corporate matter is taken shall be presumed to have assented to
the action taken unless his dissent shall be entered in the minutes of the
meeting or unless he shall file his written dissent to such action with the
person acting as the secretary of the meeting before the adjournment thereof or
shall forward such dissent by registered mail to the secretary of the
corporation immediately after the adjournment of the meeting. Such right to
dissent shall not apply to a director who voted in favor of such action.

                  Section 11. In addition to the powers and authorities by these
By-Laws expressly conferred upon it, the Board may exercise all such powers of
the corporation and do all such lawful acts and things as are not by statute or
by the Articles or by these By-Laws directed or required to be exercised or done
by the shareholders, including, but not limited to, the power by resolution
passed by a majority of the whole Board of Directors to elect one of its number
as Chairman and to delegate two or more of its number to constitute an executive
committee which shall have and exercise the authority of the Board of Directors
In the management of the business of the corporation, and to establish a
compensation committee as provided for in Section 9 or Article IV. Any action
which may be taken at a meeting of the directors or the members of the executive
committee may be taken without a meeting, if a consent or consents in writing
setting forth the action so taken shall be signed by all of the directors or the
members of the executive committee, as the case may be, and shall be filed with
the secretary of the corporation.

                                   ARTICLE IV
                                    OFFICERS

                  Section 1. Number. The officers of the corporation shall be a
President, a Vice-President, a Secretary and a Treasurer, each of whom shall be
elected by the Board of Directors. Such other officers and assistant officers as
may be deemed necessary may be elected or appointed by the Board of Directors.
Nothing containing in these By-Laws shall preclude the Board of Directors from
electing members of the Board of Directors as officers of the corporation.

                  Section 2. Election and Term of Office. The officers of the
corporation to be elected by the Board of Directors shall be elected annually by
the Board of Directors at the first meeting of the Board of Directors held after
each annual meeting of, the shareholders. If the election of officers shall not
be held at such meeting, such election shall be held as soon thereafter as
conveniently may be. Each officer shall hold office until his successor shall
have been duly elected and shall have qualified or until his death or until he
shall resign or shall have been removed in the manner hereinafter provided.




                  Section 3. Removal. Any officer or agent elected or appointed
by the Board of Directors may be removed by the Board of Directors whenever in
its judgment the best interests of the corporation would be served thereby, but
such removal shall be without prejudice to the contract rights, if any, of the
person so removed.

                  Section 4. Vacancies. A vacancy in any office because of
death, resignation, removal, disqualification or otherwise, may be filled by the
Board of Directors for the unexpired portion of the term.

                  Section 5. President. The president shall be the chief
executive officer of the corporation, and subject to the control of the Board of
Directors, shall in general supervise and control all of the business aid
affairs of the corporation. He shall, when present, preside at all meetings of
the shareholders and of the Board of Directors. He may sign, with attestation by
the Secretary, Assistant Secretary or any other proper officer of the
corporation thereunto authorized by the Board of Directors, certificates for
shares of the corporation, which he is authorized, moreover, to endorse and
transfer, any deeds, mortgages, bonds, contracts, or other instruments which the
Board of Directors has authorized to be executed, except in cases where the
signing and execution thereof shall be expressly delegated by the Board of
Directors or these By-Laws to some other officer or agent of the corporation, or
shall be required by law to be otherwise signed or executed; and in general
shall perform all duties incident to the office of President and such other
duties as may be prescribed by the Board of Directors from time to time.

                  Section 6. Vice-Presidents. In the absence of the President or
in the event of his death, inability or refusal to act, the Vice-Presidents in
the order determined by the Board of Directors shall perform the duties of the
President, and when so acting, shall have all the powers of and be subject to
all the restrictions upon the President. The Vice-Presidents shall perform such
other duties as from time to time may be assigned to him by the President or by
the Board of Directors.

                  Section 7. Secretary. The Secretary shall: (a) keep the
minutes of the shareholders' and of the Board of Directors' meetings in one or
more books provided for that purpose; (b) see that all notices are duly given in
accordance with the provisions of these By-Laws or as required by law; (c) be
custodian of the corporate records and of the seal of the corporation and see
that the seal of the corporation is affixed to all documents the execution of
which on behalf of the corporation under its seal is duly authorized; (d) keep a
register of the post office address of each shareholder which shall be furnished
to the Secretary by such shareholder; (e) have, general charge of the stock
transfer books of the corporation; and (f) in general perform all duties
incident to the office of Secretary and such other duties as from time to time
may be assigned to him by the President or by the Board of Directors.

                  Section 8. Treasurer. If required by the Board of Directors,
the Treasurer shall give a bond for the faithful discharge of his duties in such
sum and with such surety or sureties as the Board of Directors shall determine.
He shall: (a) have charge and custody of and be responsible for all funds and
securities of the corporation; receive and give receipts for moneys due and
payable to the corporation from any source whatsoever, and deposit all such
moneys in the name of the corporation in such banks, trust companies or other
depositaries as shall be selected in accordance with the provisions of Article V
of these By-Laws; and (b) in


general perform all of the duties incident to the office of Treasurer and such
other duties as from time to time may be assigned to him by the President or by
the Board of Directors.

                  Section 9. Compensation. The compensation of the officers
shall be fixed from time to time by the Board of Directors or by such
Compensation Committee as may be established by the Board of Directors to which
the Board of Directors shall delegate two or more members of the Board of
Directors and which shall have and exercise the authority of the Board of
Directors in fixing said compensation and no officer shall be prevented from
receiving such salary by reason of the fact that he is also a director of the
corporation.

                                    ARTICLE V
                                 INDEMNIFICATION

                  Section 1. This corporation 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 (other than an action by or in the right of the corporation) by
reason of the fact that he is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorney's
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in, or not opposed
to, the best interests of the corporation and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his conduct was
unlawful. The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the person did not act in good
faith and in a manner which be reasonably believed to be in, or not opposed to,
the best interests of the corporation, and, with respect to any criminal action
or proceeding, had reasonable cause to believe that his conduct was unlawful.

                  Section 2. This corporation 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 corporation to procure a
judgment in its favor by reason of the fact that he is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against
expenses (including attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in, or not opposed to,
the best interests of the corporation and except that no indemnification shall
be made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable for negligence or misconduct in the performance
of his duty to the corporation unless and only to the extent that the Court of
Common Pleas, of the county in which the registered office of the corporation is
located or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnify for such expenses which the Court of Common Pleas or such other court
shall deem proper.




                  Section 3. To the extent that a director, officer, employee or
agent of the corporation has been successful on the merits or otherwise. In
defense of any action, suit or proceeding referred to in Sections 1 and 2 or in
defense of any claim, issue or matter therein, he shall be indemnified against
expenses (including attorneys' fees) actually and reasonably incurred by him in
connection therewith.

                  Section 4. Any indemnification under Sections 1 and 2 of this
Article V (unless ordered by a court) shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification of the
director, officer, employee or agent is proper in the circumstances because he
has met the applicable standard of conduct set forth in such section. Such
determination shall be made:

                  (a) By the Board of Directors by a majority vote of a quorum
consisting of directors who were not parties to such action, suit or proceeding,
or,

                  (b) If such a quorum is not obtainable, or, even if obtainable
a majority vote of a quorum of disinterested directors so directs, by
independent legal counsel in a written opinion, or

                  (c) By the shareholders.

                  Section 5. Expenses incurred in defending a civil or criminal
action, suit or proceeding may be paid by the corporation in advance of the
final disposition of such action, suit or proceeding as authorized in the manner
provided in Section 3 upon receipt of an undertaking by or on behalf of the
director, officer, employee or agent to repay such amount unless it shall
ultimately be determined that he is entitled to be indemnified by the
corporation as authorized in this Article.

                  Section 6. The indemnification provided by this Article shall
not be deemed exclusive of any other rights to which those seeking
indemnification may be entitled under any by-law, agreement vote of shareholders
or disinterested directors or otherwise, both as to action in his official
capacity and as to action in another capacity while holding such office, and
shall continue as to a person who has ceased to be a director, officer, employee
or agent and shall inure to the benefit of the heirs, executors and
administrators of such a person.

                  Section 7. The corporation shall have the power to purchase
and maintain insurance on behalf of any person who is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against any
liability asserted against him and incurred by him in any such capacity, or
arising out of his status as such, whether or not the corporation would have the
power to indemnify him against such liability under the provisions of this
Article.

                                   ARTICLE VI
                      CONTRACTS LOANS, CHECKS AND DEPOSITS

                  Section 1. Contracts. The Board of Directors may authorize any
officer or officers, agent or agents, to enter into any contract or execute and
deliver any instrument in the


name of any on behalf of the corporation, and such authority may be general or
confined to specific instances.

                  Section 2. Loans. No loans shall be contracted on behalf of
the corporation and no evidences of indebtedness shall be issued in its name
unless authorized by a resolution of the Board of Directors. Such authority may
be general or confined to specific instances.

                  Section 3. Checks, drafts, etc. All checks, drafts and other
orders for the payment of money, notes or other evidences of indebtedness issued
in the name of the corporation, shall be signed by such officer or officers,
agent or agents of the corporation and in such manner as shall from time to time
be determined by resolution of the Board of Directors.

                  Section 4. Deposits. All funds of the corporation not
otherwise employed shall be deposited from time to time to the credit of the
corporation in such banks, trust companies or other depositaries as the Board of
Directors may select.

                                   ARTICLE VII
                   CERTIFICATES FOR SHARES AND THEIR TRANSFER

                  Section 1. Certificates for Shares. Certificates representing
shares of the corporation shall be in such form as shall be signed by the
President and by the Secretary or by such other officers authorized by law and
by he Board of Directors so to do and shall be sealed with the corporate seal
which may be facsimile, engraved or printed but where such share certificate is
signed by a transfer agent or registrar the signature of any corporate officer
upon such certificate may be facsimile, engraved or printed. In case any officer
who has signed, or whose facsimile signature has been placed upon any share
certificate shall have ceased to be such officer because of death, resignation,
or otherwise, before the certificate is issued, it may be issued by the
corporation with the same effect as if the officer had not ceased to be such at
the date of its issue. All certificates shall be consecutively numbered or
otherwise identified. The name and address of the person to whom the shares
represented thereby are issued, with the number of shares and date of issue,
shall be entered on the stock transfer books of the corporation. All
certificates surrendered to the corporation for transfer shall be cancelled and
no new certificate shall be issued until the former certificate for a like
number of shares shall have been surrendered and cancelled, except that in case
of a lost, destroyed or mutilated certificate a new one may be issued therefor
upon such terms and indemnity to the corporation as the Board of Directors may
prescribe.

                  Section 2. Transfer of Shares. Transfer of shares of the
corporation shall be made only on the stock transfer books of the corporation by
the holder of record thereof or by his legal representative, who shall furnish
proper evidence of authority to transfer, or by his attorney thereunto
authorized by power of attorney duly executed and filed with the Secretary of
the corporation, and on surrender for cancellation of the certificate for such
shares. The person in whose name shares stand on the books of the corporation
shall be deemed by the corporation to be the owner thereof for all purposes.




                                  ARTICLE VIII
                                   FISCAL YEAR

                  The fiscal year of the corporation shall begin on the first
day of January and end on the 31st day of December in each year.

                                   ARTICLE IX
                                    DIVIDENDS

                  Dividends upon the shares of the Corporation, subject to the
provisions of the Articles of Incorporation, if any, may be declared by the
Board of Directors at any regular or special meeting, pursuant to law. Dividends
may be paid in cash, in property, or in its shares, subject to the provisions of
the Articles of Incorporation.

                                    ARTICLE X
                                      SEAL

                  The Board of Directors shall provide a corporate seal which
shall be circular in form and shall have inscribed thereon the name of the
corporation and the State of incorporation and the words, "Corporate Seal".

                                   ARTICLE XI
                                WAIVER OF NOTICE

                  Unless otherwise provided by law, whenever any notice is
required to be given to any shareholders or director of the corporation under
the provisions of these By-Laws or under the provisions of the Articles of
Incorporation, a waiver thereof in writing, signed by the person or persons
entitled to such notice, whether before or after the time stated therein, shall
be deemed equivalent to the giving of such notice.

                                   ARTICLE XII
                                   AMENDMENTS

                  These By-Laws may be altered, amended or repealed and new
By-Laws may be adopted by a vote of the shareholders representing a majority of
the total voting power set forth in Section 8 of Article II of all the shares
issued and outstanding, at any annual shareholders' meeting or at any special
shareholders meeting when the proposed amendment has been set out in the notice
of such meeting, or by a majority vote of the members of the Board of Directors
at any regular or special meeting duly convened after notice to the Directors of
that purpose, subject always to the power of the shareholders to change such
action by the Directors.

EX-3.74

                                                                    EXHIBIT 3.74


                            ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


                  The undersigned, desiring to form a limited liability Company,
under Chapter 1705 of the Ohio Revised Code, do hereby state the following:

                  FIRST: The name of said limited liability company shall be:
Millford Care, LLC.

                  SECOND: This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD: The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.75

                                                                    EXHIBIT 3.75


                               STATE OF DELAWARE
                            LIMITED LIABILITY COMPANY
                            CERTIFICATE OF FORMATION


         FIRST: The name of the limited liability company is New Castle Care,
         LLC.

         SECOND: The address of its registered office in the State of Delaware
         is 30 Old Rudnick Lane, Suite 100 in the City of Dover, DE 19901. The
         name of its Registered agent at such address is Lexis Document
         Services, Inc.

         THIRD: None.

         FOURTH: None

EX-3.76

                                                                    EXHIBIT 3.76


                            ARTICLES OF ORGANIZATION
                                       FOR
                        FLORIDA LIMITED LIABILITY COMPANY

                                   ARTICLE I.
                                      NAME

                  The name of the Limited Liability Company is: New Horizon
Care, LLC.

                                   ARTICLE II.
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee, WI
53203

                                  ARTICLE III.
                     REGISTERED AGENT, REGISTERED OFFICE, &
                          REGISTERED AGENT'S SIGNATURE

                  The name and the Florida street address of the registered
agent are:

                          Lexis Document Services, Inc.
                               3953 WW Kelley Road
                              Tallahassee, FL 32311

EX-3.77

                                                                    EXHIBIT 3.77


                            ARTICLES OF ORGANIZATION
                                       FOR
                        FLORIDA LIMITED LIABILITY COMPANY

                                   ARTICLE I.
                                      NAME

                  The name of the Limited Liability Company is: North
Rehabilitation Care, LLC.

                                   ARTICLE II.
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee, WI
53203

                                  ARTICLE III.
                     REGISTERED AGENT, REGISTERED OFFICE, &
                          REGISTERED AGENT'S SIGNATURE

                  The name and the Florida street address of the registered
agent are:

                          Lexis Document Services, Inc.
                               3953 WW Kelley Road
                              Tallahassee, FL 32311

EX-3.78

                                                                    EXHIBIT 3.78

                          CERTIFICATE OF INCORPORATION
                                       OF
                        NORTHERN HEALTH FACILITIES, INC.


                  1. The name of the corporation is Northern Health Facilities,
Inc.

                  2. The address of its registered office in the State of
Delaware is No. 100 West Tenth Street, in the City of Wilmington, County of New
Castle. The name of its registered agent at such address is The Corporation
Trust Company.

                  3. The nature of the business or purposes to be conducted or
promoted is to engage in any lawful act or activity for which corporations may
be organized under the General Corporation Law of Delaware.

                  4. The total number of shares of stock which the corporation
shall have authority to issue is One Thousand (1,000) Common Shares; all of such
shares shall be without par value.

                  5. The name and mailing address of each incorporator in as
follows:

           NAME                          MAILING ADDRESS
           ----                          ---------------
       K. L. Husfelt                  100 W. Tenth St.
                                      Wilmington, Delaware 19801

       B. A. Schuman                  100 W. Tenth St.
                                      Wilmington, Delaware 19801

       E. L. Kinsler                  100 W. Tenth St.
                                      Wilmington, Delaware 19801


                  6. The name and mailing address of each person, who is to
serve as a director until the first annual meeting of the stockholders or until
a successor is elected and qualified, is as follows:


           NAME                          MAILING ADDRESS
           ----                          ---------------
       Joseph J. Zilber               105 W. Michigan
                                      Milwaukee, Wisconsin 53203

       S. Daniel Tiahberg             105 W. Michigan
                                      Milwaukee, Wisconsin 53203

       Gerald Stein                   105 W. Michigan
                                      Milwaukee, Wisconsin 53203

                  7. The corporation is to have perpetual existence.





                  8. In furtherance and not in limitation of the powers
conferred by statute, the board of directors is expressly authorized to make,
alter or repeal the by-laws of the corporation.

                  9. Elections of directors need not be by written ballot unless
the by-laws of the corporation shall so provide.

                  Meetings of stockholders may be held within or without the
State of Delaware, as the by-laws may provide. The books of the corporation may
be kept (subject to any provision contained in the statutes) outside the State
of Delaware at such place or places as may be designated from time to time by
the board of directors or in the by-laws of the corporation.

                  10. The corporation reserves the right to amend, alter, change
or repeal any provision contained in this certificate of incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.


                                       2

EX-3.79

                                                                    EXHIBIT 3.79

                                     BYLAWS
                                       OF
                        NORTHERN HEALTH FACILITIES, INC.


                                    ARTICLE I
                                     OFFICES

                  Section 1. REGISTERED OFFICE. The registered office shall be
established and maintained at the office of United States Corporation Company,
in the City of Dover, in the State of Delaware, and said corporation shall be
the registered agent of this corporation in charge thereof.

                  Section 2. OTHER OFFICES. The corporation may have other
offices, either within or without the State of Delaware, at such place or places
as the Board of Directors may from time to time appoint or the business of the
corporation may require.

                                   ARTICLE II
                            MEETINGS OF STOCKHOLDERS

                  Section 1. ANNUAL MEETINGS. Annual meetings of stockholders
for the election of directors and for such other business as may properly come
before the meeting shall be held at such place, either within or without the
State of Delaware, as the Board of Directors shall determine and as set forth in
the notice of the meeting.

                  Annual meetings of stockholders shall be held during the
fourth week of March in each year at a time and date to be determined by the
Board of Directors. At each annual meeting, the stockholders shall elect a Board
of Directors and they may transact such other business as may properly come
before the meeting.

                  Section 2. OTHER MEETINGS. Meetings of stockholders for any
purpose or purposes may be called by the President, the Secretary, the Board of
Directors or such other persons as may be authorized by law, and shall be held
at such time and place, within or without the State of Delaware, as shall be
stated in the notice of meeting.

                  Section 3. VOTING. Each stockholder entitled to vote in
accordance with the terms of the Certificate of Incorporation and in accordance
with the provisions of these By-Laws shall be entitled to one vote, in person or
by proxy, executed in writing by the stockholder or by its duly authorized
attorney in fact, for each share of stock entitled to vote held by such
stockholder. All elections for directors shall be decided by plurality vote; all
other questions shall be decided by majority vote except as otherwise provided
by the Certificate of Incorporation or the laws of the State of Delaware.

                  Section 4. QUORUM. Except as otherwise required by Law, by the
Certificate of Incorporation or by these By-Laws, the presence, in person or by
proxy, of stockholders holding a majority of the stock of the corporation
entitled to vote shall constitute a quorum at all meetings of the stockholders.
In case a quorum shall not be present at any meeting, a majority in interest of
the stockholders entitled to vote thereat, present in person or by



proxy, shall have power to adjourn the meeting from time to time, without notice
other than announcement at the meeting until the requisite amount of stock
entitled to vote shall be present; provided, that if the adjournment is for more
than thirty days or if after the adjournment a new record date is fixed for the
adjourned meeting, a notice of the adjourned meeting will be sent to each
stockholder of record entitled to vote at the meeting, as adjourned. At any such
adjourned meeting at which the requisite amount of stock entitled to vote shall
be represented, any business may be transacted which might have been transacted
at the meeting as originally noticed; but only those stockholders entitled to
vote at the meeting as originally noticed shall be entitled to vote at any
adjournment or adjournments thereof, unless a new record date therefor shall
have been fixed.

                  Section 5. NOTICE OF MEETINGS. Written notice, stating the
place, date and time of the meeting, and, in the case of a special meeting, the
purpose or purposes for which such meeting has been called, shall be given to
each stockholder entitled to vote thereat at his address as it appears on the
records of the corporation, not less than ten nor more than fifty days before
the date of the meeting.

                  Section 6. ACTION WITHOUT MEETING. Any action required to be
taken at any annual or special meeting of stockholders, or any action which may
be taken at any annual or special meeting, may be taken without a meeting,
without prior notice and without a vote, if a consent in writing, setting forth
the action so taken, shall be signed by the holders of a majority of the
outstanding stock of the corporation.

                                   ARTICLE III
                                    DIRECTORS

                  Section 1. NUMBER AND TERM. The number of authorized Directors
of the Corporation shall be not less than 1 nor more than 15, fixed from time to
time by the Shareholder. The Directors shall be elected at the annual meeting of
the Shareholders and each Director shall be elected to serve until his successor
shall be elected and shall qualify.

                  Section 2. RESIGNATIONS. Any director, member of a committee
or other officer may resign at any time. Such resignation shall be made in
writing, and shall take effect at the time specified therein, and if no time be
specified, at the time of its receipt by the President or Secretary. The
acceptance of a resignation shall not be necessary to make it effective.

                  Section 3. POWERS. The Board of Directors shall exercise all
of the powers of the corporation except such as are by law, or by the
Certificate of Incorporation of the corporation or by these By-Laws conferred
upon or reserved to the stockholders.

                  Section 4. MEETINGS. The newly elected directors may hold
their first meeting for the purpose of the transaction of business, if a quorum
be present, immediately after the annual meeting of the stockholders; or the
time and place of such meeting may be fixed by consent in writing of all the
directors.

                  Regular meetings of the directors may be held without notice
at such places and times as shall be determined from time to time by resolution
of the directors.






                  Special meetings of the board may be called by or at the
request of the President, the Secretary or any two directors. Such meeting shall
be held at such place or places as shall be stated in the call of the meeting.
Notice of any special meeting shall be given at least six (6) hours previously
thereto in any one of the following methods: by oral or telephonic notice, by
written notice delivered personally or mailed to each director at his business
address, or by telegram; provided, that if notice is given by mail only, it
shall be given at least forty-eight (48) hours prior to such meeting. If mailed,
such notice shall be deemed to be delivered when deposited in the United States
mail so addressed, with postage thereon prepaid. If notice is given by telegram,
such notice shall be deemed delivered when the telegram is delivered to the
telegraph company. Whenever any notice whatever is required to be given to any
director of the corporation under the Certificate of Incorporation or these
By-Laws or any provision of law, a waiver thereof in writing, signed at any
time, whether before or after the time of the meeting, by the director entitled
to such notice, shall be deemed equivalent to the giving of such notice.

                  Members of the Board of Directors, or any committee designated
by the Board of Directors, may participate in a meeting of the Board of
Directors, or any committee, by means of conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other, and such participation in a meeting shall
constitute presence in person at the meeting.

                  Section 5. COMMITTEES. The Board of Directors may, by
resolution or resolutions passed by a majority of the whole board, designate one
or more committees, each committee to consist of one or more directors of the
corporation. The board may designate one or more directors as alternate members
of any committee, who may replace any absent or disqualified member at any
meeting of the committee. In the absence or disqualification of any member of
such committee or committees, the member or members thereof present at any
meeting and not disqualified from voting, whether or not he or they constitute a
quorum, may unanimously appoint another member of the Board of Directors to act
at the meeting in the place of any such absent or disqualified member.

                  Any such committee, to the extent provided in the resolution
of the Board of Directors, or in these. By-Laws shall have and may exercise all
the powers and authority of the Board of Directors in the management of the
business and affairs of the corporation, and may authorize the seal of the
corporation to be affixed to all papers which may require it; but no such
committee shall have the power or authority in reference to amending the
Certificate of Incorporation, adopting an agreement of merger or consolidation,
recommending to the stockholders the sale, lease or exchange of all or
substantially all of the corporation's property and assets, recommending to the
stockholders a dissolution of the corporation or a revocation of a dissolution,
or amending the By-Laws of the corporation and, unless the resolution, these
By-Laws, or the Certificate of Incorporation expressly so provide, no such
committee shall have the power or authority to declare a dividend or to
authorize the issuance of stock.

                  Section 6. QUORUM. A majority of the directors shall
constitute a quorum for the transaction of business. If at any meeting of the
board there shall be less than a quorum present, a majority of those present may
adjourn the meeting from time to time until a quorum is obtained, and no further
notice thereof need be given other than by announcement at the meeting which
shall be so adjourned.






                                   ARTICLE IV
                                    OFFICERS

                  Section 1. OFFICERS. The officers of the corporation shall be
a President, a Treasurer, and a Secretary, all of whom shall be elected by the
Board of Directors and who shall hold office until their successors are elected
and qualified or until their earlier termination, death, resignation or removal.
In addition, the Board of Directors may elect a Chairman, one or more
Vice-Presidents and such Assistant Secretaries and Assistant Treasurers as they
may deem proper. None of the officers of the corporation need be directors. The
officers shall be elected at the first meeting of the Board of Directors after
each annual meeting. More than two offices may be held by the same person.

                  Section 2. OTHER OFFICERS AND AGENTS. The Board of Directors
may appoint such other officers and agents as it may deem advisable, who shall
hold their offices for such terms and shall exercise such powers and perform
such duties as shall be determined from time to time by the Board of Directors.

                  Section 3. CHAIRMAN. The Chairman of the Board of Directors,
if one be elected, shall preside at all meetings of the Board of Directors and
he shall have and perform such other duties as from time to time may be assigned
to him by the Board of Directors.

                  Section 4. PRESIDENT. The President shall have the general
powers and duties of supervision and management usually vested in the office of
President of a corporation. He shall preside at all meetings of the stockholders
if present thereat, and in the absence or non-election of the Chairman of the
Board of Directors, at all meetings of the Board of Directors, and shall have
general supervision, direction and control of the business of the corporation.
Except as the Board of Directors shall authorize the execution thereof in some
other manner, he shall execute bonds, mortgages and other contracts in behalf of
the corporation, and shall cause the seal to be affixed to any instrument
requiring it and when so affixed the seal shall be attested by the signature of
the Secretary or the Treasurer or an Assistant Secretary or an Assistant
Treasurer.

                  Section 5. VICE-PRESIDENT. Each Vice-President shall have such
powers and shall perform such duties as shall be assigned to him by the Board of
Directors, or if no such powers and duties shall be assigned by the Board of
Directors, then such powers and duties as shall be assigned to him by the
Chairman of the Board of Directors or the President.

                  Section 6. TREASURER. The Treasurer shall have the custody of
the-corporate funds and securities and shall keep full and accurate account of
receipts and disbursements in books belonging to the corporation. He shall
deposit all moneys and other valuables in the name and to the credit of the
corporation in such depositaries as may be designated by the Board of Directors.

                  The Treasurer shall disburse the funds of the corporation as
may be ordered by the Board of Directors, or the President, taking proper
vouchers for such disbursements. He shall render to the President and Board of
Directors at the regular meetings of the Board of Directors, or whenever they
may request it, an account of all his transactions as Treasurer and of the




financial condition of the corporation. If required by the Board of Directors,
he shall give the corporation a bond for the faithful discharge of his duties in
such amount and with such surety as the Board of Directors shall prescribe.

                  Section 7. SECRETARY. The Secretary shall give, or cause to be
given, notice of all meetings of stockholders and directors, and all other
notices required by law or by these By-Laws, and in case of his absence or
refusal or neglect so to do, any such notice may be given by any person
thereunto directed by the President, or by the Board of Directors, or
stockholders, upon whose requisition the meeting is called as provided in these
By-Laws. He shall record all the proceedings of the meetings of the corporation
and of the directors in a book to be kept for that purpose, and shall perform
such other duties as may be assigned to him by the Board of Directors or the
president. He shall have the custody of the seal of the corporation and shall
affix the same to all instruments requiring it, when authorized by the Board of
Directors or the President, and attest the same.

                  Section 8. ASSISTANT TREASURERS AND ASSISTANT SECRETARIES.
Assistant Treasurers and Assistant Secretaries, if any, shall be elected and
shall have such powers and shall perform such duties as shall be assigned to
them, respectively, by the Board of Directors.

                                    ARTICLE V
                                  MISCELLANEOUS

                  Section 1. CERTIFICATES OF STOCK. Certificates of stock,
signed by the President or Vice-President and Secretary or any Assistant
Secretary, shall be issued to each stockholder certifying the number of shares
owned by such stockholder in the corporation. Any or all of the signatures may
be facsimiles.

                  Section 2. TRANSFER OF SHARES. The shares of stock of the
corporation shall be transferable only upon its books by the holders thereof in
person or by their duly authorized attorneys or legal representatives, and upon
such transfer the old certificates shall be surrendered to the corporation by
the delivery thereof to the person in charge of the stock and transfer books and
ledgers, or to such other person as the directors may designate, by whom they
shall be cancelled, and new certificates shall thereupon be issued. A record
shall be made of each transfer and whenever a transfer shall be made for
collateral security, and not absolutely, it shall be so expressed in the entry
of the transfer.

                  Section 3. STOCKHOLDERS RECORD DATE. In order that the
corporation may determine the stockholders entitled to notice of or to vote at
any meeting of stockholders or any adjournment thereof, or to express consent to
corporate action in writing without a meeting, or entitled to receive payment of
any dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any change, conversion or exchange of stock or
for the purpose of any other lawful action, the Board of Directors may fix, in
advance, a record date, which shall not be more than fifty nor less than ten
days before the date of such meeting, nor more than fifty days prior to any
other action. A determination of stockholders of record entitled to notice of or
to vote at a meeting of stockholders shall apply to




any adjournment of the meeting; provided, however, that the Board of Directors
may fix a new record date for the adjourned meeting.

                  Section 4. SEAL. The corporate seal shall be circular in form
and shall contain the name of the corporation, its state of incorporation and
the words "CORPORATE SEAL." Said seal may be used by causing it or a facsimile
thereof to be impressed or affixed or reproduced or otherwise.

                  Section 5. FISCAL YEAR. The fiscal year of the corporation,
beginning with the year 1983, shall be the calendar year.

                  Section 6. CHECKS. All checks, drafts or other orders for the
payment of money, notes or other evidences of indebtedness issued in the name of
the corporation shall be signed by such officer or officers, agent or agents of
the corporation, and in such manner as shall be determined from time to time by
resolution of the board of directors.

                  Section 7. INDEMNIFICATION. The corporation may indemnify its
officers, directors, employees and agents to the full extent permitted by law.

                  Section 8. NOTICE AND WAIVER OF NOTICE. Whenever, under the
provisions of law, the Certificate of Incorporation or these By-Laws, notice is
required to be given to any person, it shall not be construed to mean personal
notice, but such notice may be given in writing, by mail, addressed to such
person at his address as it appears on the records of the corporation, with
postage thereon prepaid, and such notice shall be deemed to be given at the time
when the same shall be deposited in the United States mail. Notice to directors
may also be given by any of the methods specified in Article III, Section 8 of
these By-Laws.

                  Whenever any notice whatever is required to be given under the
provisions of any law, the Certificate of Incorporation or these By-Laws, a
waiver thereof in writing, signed by the person or persons entitled to said
notice, whether before or after the time stated therein, shall be deemed
equivalent thereto. Any waiver of notice to stockholders shall set forth in
reasonable detail the purpose or purposes for which the meeting is called and
the time and place thereof. Attendance by a director or stockholder at any
meeting of directors or stockholders, respectively, shall constitute a waiver of
notice of such meeting, except where such director or stockholder attends a
meeting for the express purpose of objecting, at the beginning of such meeting,
to the transaction of business because the meeting is not lawfully called or
convened.

                                   ARTICLE VI
                                   AMENDMENTS

                  These By-Laws may be altered or repealed and By-Laws may be
made at any annual meeting of the stockholders or at any special meeting thereof
if notice of the proposed alteration or repeal or By-Law or By-Laws to be made
be contained in the notice of such special meeting, by the affirmative vote of a
majority of the stock issued and outstanding and entitled to vote thereat, or by
the affirmative vote of a majority of the Board of Directors, at any regular or
special meeting of the Board of Directors.

EX-3.80

                                                                    EXHIBIT 3.80


                       CERTIFICATE OF LIMITED PARTNERSHIP

         In compliance with the requirements of the Delaware Limited Partnership
Act, Title 6, Chapter 17 of the Delaware Code (relating to certificate of
limited partnership), the undersigned, desiring to form a limited partnership,
hereby certifies that:

1.       The name of the limited partnership is:     Oak Hill Care, LP

2.       The address of this limited partnership's initial registered office is:


         111 West Michigan Street,       Milwaukee,       WI              53203              Milwaukee
         -------------------------------------------------------------------------------------------------
            Number and Street              City          State             Zip                County



3.       The address of this limited partnership's registered agent upon whom
         process may be served is:


         Lexis Document Services Inc.
         30 Old Rudnick Lane, Suite 100,      Dover,        DE            19901             Kent
         --------------------------------------------------------------------------------------------------
             Number and Street                City         State           Zip            County



4.       The name and business address of each general partner of the
         partnership is:


         Name                               Address

         Coventry Care Holdings, Inc.       111 West Michigan Street, Milwaukee, WI  53203




5.       The formation of the limited partnership shall be effective upon filing
         this Certificate of Limited Partnership with the Office of the
         Secretary of State.

EX-3.81

                                                                    EXHIBIT 3.81


                            ARTICLES OF INCORPORATION
                                       OF
                      OAK HILL HOME OF REST AND CARE, INC.


                  In compliance with the requirements of the Business
Corporation Law, approved the 5th day of May, A. D. 1933, P. L 364, as amended,
the undersigned, all of whom are of full age end at least two-thirds of whom are
citizens of the United States or its territories or possessions, desiring that
they may be incorporated as a business corporation, do hereby certify:

                  1. The name of the corporation is: Oak Hill Home of Rest and
Care, Inc.

                  2. The location and post office address of its initial
registered office in this Commonwealth is:





           R. D. #7                                                  Greensburg,                 Westmoreland
- ----------------------------------------------------------------------------------------------------------------
            Number                        Street                        City                        County


                  3. The purpose or purposes of the corporation are:

                  To own and operate a nursing and convalescence home and
provide all the services necessary and incidental thereto.

                  4. The term of its existence is Perpetual.

                  5. The aggregate number of shares which the corporation shall
have authority to issue is 25,000 shares with a par value of $1 per share

                  6. The names and addresses of each of the first directors, who
shall serve until the first annual meeting, are:



             NAME                                       ADDRESS
                                         (INCLUDING STREET AND NUMBER, IF ANY)
                                      
George J. Kucenic                         R. D. #7, Greensburg, Pennsylvania
Doris C. Kucenic                          R. D. #7, Greensburg, Pennsylvania
Paula K. Fox                              R. D. #7, Greensburg, Pennsylvania





                  7. The names and addresses of each of the Incorporators and
the number and class of shares subscribed by each are:




               NAME                                       ADDRESS                                 NUMBER AND
                                           (INCLUDING STREET AND NUMBER, IF ANY)               CLASS OF SHARES
                                                                                         
Emmett C. Boyle, Jr.                 15 East Otterman Street, Greensburg, Pa.                     1 - common
Richard A. Harwick                   15 East Otterman Street, Greensburg, Pa.                     1 - common
William C. Stillwagon                15 East Otterman Street, Greensburg, Pa.                     1 - common

EX-3.82

                                                                    EXHIBIT 3.82



                      OAK HILL HOME OF REST AND CARE, INC.
                                     BY-LAWS

                                   ARTICLE I
                                     Offices

                  Section 1. The registered office of the corporation shall be
at R. D. #7, Greensburg, Pennsylvania.

                  Section 2. The corporation may also have offices at such other
places as the Board of Directors may from time to time appoint or the business
of the corporation may require.

                                   ARTICLE II
                                      Seal

                  Section 1. The corporate seal shall have inscribed thereon the
name of the corporation, the year of its organization and the words "Corporate
Seal, Pennsylvania".

                                  ARTICLE III
                              Shareholders' Meeting

                  Section 1. Meetings of the shareholders shall be held at the
office of the corporation at R. D. #7, Greensburg, Pennsylvania, or at such
other place or places, either within or without the Commonwealth of
Pennsylvania, as may from time to time be selected.

                  Section 2. The annual meeting of the shareholders, shall be
the fourth week of March per Shareholder Action dated December 1, 1994, when
they shall elect a Board of Directors, and transact such other business as may
properly be brought before the meeting. If the annual meeting shall not be
called and held during any calendar year, any shareholder may call such meeting
at anytime thereafter.

                  Section 3. The presence, in person or by proxy, of
shareholders entitled to cast at least a majority of the votes which all
shareholders are entitled to cast on the particular matter shall constitute a
quorum for the purpose of considering such matter. The shareholders present at a
duly organized meeting can continue to do business until adjournment,
notwithstanding the withdrawal of enough shareholders to leave less than a
quorum. Adjournment or adjournments of any annual or special meeting may be
taken, but any meeting at which directors are to be elected shall be adjourned
only from day to day, or for such longer periods not exceeding fifteen days
each, as may be directed by shareholders who are present in person or by proxy
and who are entitled to cast at least a majority of the votes which all such
shareholders would be entitled to cast at an election of directors until such
directors have been elected. If a meeting cannot be organized because a quorum
has not attended, those present may, except as otherwise provided by statute,
adjourn the meeting to such time and place as they may determine, but in the
case of any meeting called for the election of directors, those who attend the
second of such adjourned meetings, although less than a quorum, shall
nevertheless constitute a quorum for the purpose of electing directors.





                  Section 4. At each meeting of the shareholders, every
shareholder having the right to vote shall be entitled to vote either in person
or by proxy. Every proxy shall be executed in writing by the shareholder, or by
his duly authorized attorney in fact, and filed with the Secretary of the
corporation. A proxy, unless coupled with an interest, shall be revocable at
will, notwithstanding any other agreement or any provision in the proxy to the
contrary, but the revocation of a proxy shall not be effective until notice
thereof has been given to the Secretary of the corporation. No unrevoked proxy
shall be valid after eleven months from the date of its execution, unless a
longer time is expressly provided therein, but in no event shall a proxy, unless
coupled with an interest, be voted on after three years from the date of its
execution. In all elections for directors cumulative voting shall be allowed.
Upon demand made by a shareholder at any election for directors before the
voting begins, the election shall be by ballot. No share shall be voted at any
meeting upon which any installment is due and unpaid.

                  Section 5. Written notice of the annual meeting shall be given
to each shareholder entitled to vote thereat, at least five (5) days prior to
the meeting.

                  Section 6. In advance of any meeting of shareholders, the
Board of Directors may appoint judges of election, who need not be shareholders,
to act at such meeting or any adjournment thereof. If judges of election be not
so appointed, the chairman of any such meeting may, and on the request of any
shareholder or his proxy, shall make such appointment at the meeting. The number
of judges shall be one or three. If appointed at a meeting on the request of one
or more shareholders or proxies, the majority of shares present and entitled to
vote shall determine whether one or three judges are to be appointed. On request
of the chairman of the meeting, or of any shareholder or his proxy, the judges
shall make a report in writing of any challenge or question or matter determined
by them, and execute a certificate of any fact found by them. No person who is a
candidate for office shall act as a judge.

                  Section 7. Special meetings of the shareholders may be called
at any time by the President, or the Board of Directors, or shareholders
entitled to cast at least one-fifth of the votes which all shareholders are
entitled to cast at the particular meeting. At any time, upon written request of
any person or persons who have duly called a special meeting, it shall be the
duty of the Secretary to fix the date of the meeting, to be held not more than
sixty days after the receipt of the request, and to give due notice thereof. If
the Secretary shall neglect or refuse to fix the date of the meeting and give
notice thereof, the person or persons calling the meeting may do so.

                  Section 8. Business transacted at all special meetings shall
be confined to the objects stated in the call and matters germane thereto,
unless all shareholders entitled to vote are present and consent.

                  Section 9. Written notice of a special meeting of shareholders
stating the time and place and object thereof, shall be given to each
shareholder entitled to vote thereat at least three (3) days before such
meeting, unless a greater period of notice is required by statute in a
particular case.

                  Section 10. The officer or agent having charge of the transfer
books shall make at least five days before each meeting of shareholders, a
complete list of the shareholders entitled

                                       2



to vote at the meeting, arranged in alphabetical order, with the address of and
the number of shares held by each, which list shall be subject to inspection by
any shareholder at any time during usual business hours. Such list shall also be
produced and kept open at the time and place of the meeting, and shall be
subject to the inspection of any shareholder during the whole time of the
meeting. The original share ledger or transfer book, or a duplicate thereof kept
in this Commonwealth, shall be prima facie evidence as to who are the
shareholders entitled to examine such list or share ledger or transfer book, or
to vote in person or by proxy, at any meeting of shareholders.

                                   ARTICLE IV
                                    Directors

                  Section 1. The number of authorized Directors of the
Corporation shall be not less than 1 nor more than 15, fixed from time to time
by the Shareholder. The Directors shall be elected at the annual meeting of the
Shareholders and each Director shall be elected to serve until his successor
shall be elected and shall qualify.

                  Section 2. In addition to the powers and authorities by these
By-Laws expressly conferred upon them, the Board may exercise all such powers of
the corporation and do all such lawful acts and things as are not by statute or
by the Articles or by these By-Laws directed or required to be exercised or done
by the shareholders.

                  Section 3. The meetings of the Board of Directors may be held
at such place within this Commonwealth, or elsewhere, as a majority of the
directors may from time to time appoint, or as may be designated in the notice
calling the meeting.

                  Section 4. Each newly elected Board may meet at such place and
time as shall be fixed by the shareholders at the meeting at which such
directors are elected and no notice shall be necessary to the newly elected
directors in order legally to constitute the meeting, or they may meet at such
place and time as may be fixed by the consent in writing of all the directors.

                  Section 5. Regular meetings of the Board shall be held without
notice on the first Monday of the month at 11:00 A.M., at the registered office
of the company, or at such other time and place as shall be determined by the
Board.

                  Section 6. Special meetings of the Board may be called by the
President on three days notice to each director, either personally or by mail or
by telegram; special meetings shall be called by the President or Secretary in
like manner and on like notice on the written request of two directors.

                  Section 7. A majority of the directors in office shall be
necessary to constitute a quorum for the transaction of business, and the acts
of a majority of the directors present at a meeting at which a quorum is present
shall be the acts of the Board of Directors. If all the directors shall
severally or collectively consent in writing to any action to be taken by the
corporation, such action shall be as valid corporate action as though it had
been authorized at a meeting of the Board of Directors.

                                       3


                  Section 8. Directors as such, shall not receive any stated
salary for their services, but by resolution of the Board, a fixed sum and
expenses of attendance, if any, may be allowed for attendance at each regular or
special meeting of the Board PROVIDED, that nothing herein contained shall be
construed to preclude any director from serving the corporation in any other
capacity and receiving compensation therefor.

                                   ARTICLE V
                                    Officers

                  Section 1. The executive officers of the corporation shall be
chosen by the directors and shall be a President, Secretary, and Treasurer. The
Board of Directors may also choose a Vice-President and such other officers and
agents as it shall deem necessary, who shall hold their offices for such terms
and shall have such authority and shall perform such duties as from time to time
shall be prescribed by the Board. Any two or more offices may be held by the
same person, except the offices of President and Secretary. It shall not be
necessary for the officers to be directors.

                  Section 2. The salaries of all officers and agents of the
corporation shall be fixed by the Board of Directors.

                  Section 3. The officers of the corporation shall hold office
for one year and until their successors are chosen and have qualified. Any
officer elected or appointed by the Board of Directors may be removed by the
Board of Directors whenever in their judgment the best interests of the
corporation will be served thereby.

                  Section 4. The President shall be the chief executive officer
of the corporation; he shall preside at all meetings of the shareholders and
directors; he shall have general and active management of the business of the
corporation, shall see that all orders and resolutions of the Board are carried
into effect, subject, however, to the right of the directors to delegate any
specific powers, except such as may be by statute exclusively conferred on the
President, to any other officer or officers of the corporation. He shall execute
bonds, mortgages and other contracts requiring a seal, under the seal of the
corporation. He shall be EX-OFFICIO a member of all committees, and shall have
the general powers and duties of supervisor and management usually vested in the
office of President of a corporation.

                  Section 5. The Secretary shall attend all sessions of the
Board and all meetings of the shareholders and act as clerk thereof, and record
all the votes of the corporation and the minutes of all its transactions in a
book to be kept for that purpose; and shall perform like duties for all
committees of the Board of Directors when required. He shall give, or cause to
be given, notice of all meetings of the shareholders and of the Board of
Directors, and shall perform such other duties as may be prescribed by the Board
of Directors or President, and under whose supervision he shall be. He shall
keep in safe custody the corporate seal of the corporation, and when authorized
by the Board, affix the same to any instrument requiring it.

                  Section 6. The Treasurer shall have custody of the corporate
funds and securities and shall keep full and accurate accounts of receipts and
disbursements in books belonging to the corporation, and shall keep the moneys
of the corporation in a separate account

                                       4


to the credit of the corporation. He shall disburse the funds of the corporation
as may be ordered by the Board, taking proper vouchers for such disbursements,
and shall render to the President and Directors, at the regular meetings of the
Board, or whenever they may require it, an account of all his transactions as
Treasurer and of the financial condition of the corporation.

                                   ARTICLE VI
                                    Vacancies

                  Section 1. If the office of any officer or agent, one or more,
becomes vacant for any reason, the Board of Directors may choose a successor or
successors, who shall hold office for the unexpired term in respect of which
such vacancy occurred.

                  Section 2. Vacancies in the Board of Directors, including
vacancies resulting from an increase in the number of directors, shall be filled
by a majority of the remaining members of the Board though less than a quorum,
and each person so elected shall be a director until his successor is elected by
the shareholders, who may make such election at the next annual meeting of the
shareholders or at any special meeting duly called for that purpose and held
prior thereto.

                                   ARTICLE VII
                                Corporate Records

                  Section 1. There shall be kept at the registered office of the
corporation an original or duplicate record of the proceedings of the
shareholders and of the directors, and the original or a copy of its By-Laws,
including all amendments or alterations thereto to date, certified by the
Secretary of the corporation. An original or duplicate share register shall also
be kept at the registered office, or at the office of a transfer agent or
registrar within this Commonwealth, giving the names of the shareholders in
alphabetical order, and showing their respective addresses, the number and
classes of shares held by each, the number and date of certificates issued for
the shares, and the number and date of cancellation of every certificate
surrendered for cancellation.

                  Section 2. Every shareholder shall have a right to examine, in
person or by agent or attorney, at any reasonable time or times, for any
reasonable purpose, the share register, books or records of account, and records
of the proceedings of the shareholders and directors, and make extracts
therefrom.

                                  ARTICLE VIII
                       Share Certificates, Dividends, Etc.

                  Section 1. The share certificates of the corporation shall be
numbered and registered in the share ledger and transfer books of the
corporation, as they are issued. They shall be signed by the President and
Secretary, and shall bear the corporate seal.

                  Section 2. Transfers of shares shall be made on the books of
the corporation upon surrender of the certificates therefor, endorsed by the
person named in the certificate or by attorney, lawfully constituted in writing.
No transfer shall be made inconsistent with the

                                       5


provisions of Article 8 of the Uniform Commercial Code, approved the sixth day
of April, one thousand nine hundred fifty-three (Act No. 1), and its amendments
and supplements.

                  Section 3. The Board of Directors may fix a time, not more
than fifty days, prior to the date of any meeting of shareholders, or the date
fixed for the payment of any dividend or distribution, or the date for the
allotment of rights, or the date when any change or conversion or exchange of
shares will be made or go into effect, as a record date for the determination of
the shareholders entitled to notice of, or to vote at, any such meeting, or
entitled to receive payment of any such dividend or distribution, or to receive
any such allotment of rights, or to exercise the rights in respect to any such
change, conversion, or exchange of shares. In such case, only such shareholders
as shall be shareholders of record on the date so fixed shall be entitled to
notice of, or to vote at such meeting, or to receive payment of such dividend,
or to receive such allotment of rights, or to exercise such rights as the case
may be, notwithstanding any transfer of any shares on the books of the
corporation after any record date fixed, as aforesaid. The Board of Directors
may close the books of the corporation against transfers of shares during the
whole or any part of such period, and in such case, written or printed notice
thereof shall be mailed at least ten days before the closing thereof to each
shareholder of record at the address appearing on the records of the corporation
or supplied by him to the corporation for the purpose of notice. While the stock
transfer books of the corporation are closed, no transfer of shares shall be
made thereon. If no record date is fixed for the determination of shareholders
entitled to receive notice of, or vote at, a shareholders' meeting, transferees
of shares which are transferred on the books of the corporation within ten days
next preceding the date of such meeting shall not be entitled to notice of or
vote at such meeting.

                  Section 4. In the event that a share certificate shall be
lost, destroyed or mutilated, a new certificate may be issued therefor upon such
terms and indemnity to the corporation as the Board of Directors may prescribe.

                  Section 5. The Board of Directors may declare and pay
dividends upon the outstanding shares of the corporation, from time to time and
to such extent as they deem advisable, in the manner and upon the terms and
conditions provided by statute and the Articles of Incorporation.

                  Section 6. Before payment of any dividend there may be set
aside out of the net profits of the corporation such sum or sums as the
directors, from time to time, in their absolute discretion, think proper as a
reserve fund to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the corporation, or for such other
purpose as the directors shall think conducive to the interests of the
corporation, and the directors may abolish any such reserve in the manner in
which it was created.

                                   ARTICLE IX
                            Miscellaneous Provisions

                  Section 1. All checks or demands for money and notes of the
corporation shall be signed by such officer or officers as the Board of
Directors may from time to time designate.

                                        6



                  Section 2. The fiscal year shall begin the 1st day of November
each year.

                  Section 3. Whenever written notice is required to be given to
any person, it may be given to such person, either personally or by sending a
copy thereof through the mail, or by telegram, charges prepaid, to his address
appearing on the books of the corporation, or supplied by him to the corporation
for the purpose of notice. If the notice is sent by mail or by telegraph, it
shall be deemed to have been given to the person entitled thereto when deposited
in the United States mail or with a telegraph office for transmission to such
person. Such notice shall specify the place, day and hour of the meeting and, in
the case of a special meeting of shareholders, the general nature of the
business to be transacted.

                  Section 4. Whenever any written notice is required by statute,
or by the Articles or By-Laws of this corporation, a waiver thereof in writing,
signed by the person or persons entitled to such notice, whether before or after
the time stated therein, shall be deemed equivalent to the giving of such
notice. Except in the case of a special meeting, neither the business to be
transacted at nor the purpose of the meeting need be specified in the waiver of
notice of such meeting. Attendance of a person, either in person or by proxy, at
any meeting shall constitute a waiver of notice of such meeting, except where a
person attends a meeting for the express purpose of objecting to the transaction
of any business because the meeting was not lawfully called or convened.

                                   ARTICLE X
                                Annual Statement

                  Section 1. The President and Board of Directors shall present
at each annual meeting a full and complete statement of the business and affairs
of the corporation for the preceding year. Such statement shall be prepared and
presented in whatever manner the Board of Directors shall deem advisable and
need not be verified by a certified public accountant.

                                   ARTICLE XI
                                   Amendments

                  Section 1. These By-Laws may be altered or repealed and
By-Laws may be made at any annual meeting of the stockholders or at any special
meeting thereof if notice of the proposed alteration or repeal or By-Law or
By-Laws to be made be contained in the notice of such special meeting, by the
affirmative vote of a majority of the stock issued and outstanding and entitled
to vote thereat, or by the affirmative vote of a majority of the Board of
Directors, at any regular or special meeting of the Board of Directors.

                                       7

EX-3.83

                                                                    EXHIBIT 3.83

                          ARTICLES OF ORGANIZATION FOR
                        FLORIDA LIMITED LIABILITY COMPANY


                                   ARTICLE I
                                      NAME

                  The name of the Limited Liability Company is: Orange Park
Care, LLC.

                                   ARTICLE II
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee,
Wisconsin 53203.

                                  ARTICLE III
                                    DURATION

                  The period of duration for the Limited Liability Company shall
be: Unlimited/Perpetual.

                                   ARTICLE IV
                                   MANAGEMENT

                  The Limited Liability Company is to be managed by the members
and the name and address of the managing member is: Northern Health Facilities,
Inc., 111 West Michigan Street, Milwaukee, Wisconsin 53203.

                                   ARTICLE V
                         ADMISSION OF ADDITIONAL MEMBERS

                  The right, if given, of the members to admit additional
members and the terms and conditions of the admissions shall be: N/A.

                                   ARTICLE VI
                       MEMBERS RIGHTS TO CONTINUE BUSINESS

                  The right, if given, of the remaining members of the limited
liability company to continue the business on the death, retirement,
resignation, expulsion, bankruptcy, or dissolution of a member or the occurrence
of any other event which terminates the continued membership of a member in the
limited liability company shall be: None.

                                  ARTICLE VII
                    AFFIDAVIT OF MEMBERSHIP AND CONTRIBUTIONS

                  The undersigned member or authorized representative of a
member of Orange Park Care, LLC certifies:




                  1.       the above named limited liability company has at
                           least one member;

                  2.       the total amount of cash contributed by the member(s)
                           is $1,000;

                  3.       if any, the agreed value of property other than cash
                           contributed by member(s) is $0.00 (A description of
                           the property is attached and made a part hereto.);
                           and

                  4.       the total amount of cash and property contributed and
                           anticipated to be contributed by member(s) is $1,000.






                                       2

EX-3.84

                                                                    EXHIBIT 3.84

                            ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


                  The undersigned, desiring to form a limited liability Company,
under Chapter 1705 of the Ohio Revised Code, do hereby state the following:

                  FIRST: The name of said limited liability company shall be:
Oregon Care, LLC.

                  SECOND: This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD: The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.85

                                                                    EXHIBIT 3.85

                            ARTICLES OF ORGANIZATION
                                       FOR
                        FLORIDA LIMITED LIABILITY COMPANY

                                   ARTICLE I.
                                      NAME

        The name of the Limited Liability Company is: Palm Court Care, LLC.

                                   ARTICLE II.
                                     ADDRESS

        The mailing address and street address of the principal office of the
Limited Liability Company is: 111 West Michigan Street, Milwaukee, WI 53203

                                  ARTICLE III.
                     REGISTERED AGENT, REGISTERED OFFICE, &
                          REGISTERED AGENT'S SIGNATURE

        The name and the Florida street address of the registered agent are:

                          Lexis Document Services, Inc.
                               3953 WW Kelley Road
                              Tallahassee, FL 32311

EX-3.86

                                                                    EXHIBIT 3.86

                                STATE of DELAWARE
                            LIMITED LIABILITY COMPANY
                            CERTIFICATE of FORMATION


                  FIRST: The name of the limited liability company is Partners
                  Health Group - Florida, LLC.

                  SECOND: The address of its registered office in the State of
                  Delaware is 30 Old Rudnick Lane, Suite 100 in the City of
                  Dover, County of Kent. The name of its Registered Agent at
                  such address is Lexis Document Services, Inc.

                  THIRD: None.

                  FOURTH: None.

EX-3.87

                                                                    EXHIBIT 3.87

                                STATE of DELAWARE
                            LIMITED LIABILITY COMPANY
                            CERTIFICATE of FORMATION


                  FIRST: The name of the limited liability company is Partners
                  Health Group - Louisiana, LLC.

                  SECOND: The address of its registered office in the State of
                  Delaware is 30 Old Rudnick Lane, Suite 100 in the City of
                  Dover, County of Kent. The name of its Registered Agent at
                  such address is Lexis Document Services, Inc.

                  THIRD: None.

                  FOURTH: None.

EX-3.88

                                                                    EXHIBIT 3.88

                                STATE of DELAWARE
                            LIMITED LIABILITY COMPANY
                            CERTIFICATE of FORMATION


                  FIRST: The name of the limited liability company is Partners
                  Health Group - Texas, LLC.

                  SECOND: The address of its registered office in the State of
                  Delaware is 30 Old Rudnick Lane, Suite 100 in the City of
                  Dover, County of Kent. The name of its Registered Agent at
                  such address is Lexis Document Services, Inc.

                  THIRD: None.

                  FOURTH: None.

EX-3.89

                                                                    EXHIBIT 3.89

                                STATE of DELAWARE
                            LIMITED LIABILITY COMPANY
                            CERTIFICATE of FORMATION


                  FIRST: The name of the limited liability company is Partners
                  Health Group, LLC.

                  SECOND: The address of its registered office in the State of
                  Delaware is 30 Old Rudnick Lane, Suite 100 in the City of
                  Dover, County of Kent. The name of its Registered Agent at
                  such address is Lexis Document Services, Inc.

                  THIRD: None.

                  FOURTH: None.

EX-3.90

                                                                    EXHIBIT 3.90
                          ARTICLES OF ORGANIZATION FOR
                       FLORIDA LIMITED LIABILITY COMPANY


                                   ARTICLE I
                                      NAME

                  The name of the Limited Liability Company is: Port Charlotte
Care, LLC.

                                   ARTICLE II
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee,
Wisconsin 53203.

                                  ARTICLE III
                                    DURATION

                  The period of duration for the Limited Liability Company shall
be: Unlimited/Perpetual.

                                   ARTICLE IV
                                   MANAGEMENT

                  The Limited Liability Company is to be managed by the members
and the name and address of the managing member is: Northern Health Facilities,
Inc., 111 West Michigan Street, Milwaukee, Wisconsin 53203.

                                   ARTICLE V
                         ADMISSION OF ADDITIONAL MEMBERS

                  The right, if given, of the members to admit additional
members and the terms and conditions of the admissions shall be: N/A.

                                   ARTICLE VI
                       MEMBERS RIGHTS TO CONTINUE BUSINESS

                  The right, if given, of the remaining members of the limited
liability company to continue the business on the death, retirement,
resignation, expulsion, bankruptcy, or dissolution of a member or the occurrence
of any other event which terminates the continued membership of a member in the
limited liability company shall be: None.

                                  ARTICLE VII
                    AFFIDAVIT OF MEMBERSHIP AND CONTRIBUTIONS

                  The undersigned member or authorized representative of a
member of Port Charlotte Care, LLC certifies:








         1.       the above named limited liability company has at least one
                  member;

         2.       the total amount of cash contributed by the member(s) is
                  $1,000;

         3.       if any, the agreed value of property other than cash
                  contributed by member(s) is $0.00 (A description of the
                  property is attached and made a part hereto.); and

         4.       the total amount of cash and property contributed and
                  anticipated to be contributed by member(s) is $1,000.




                                       2

EX-3.91

                                                                    EXHIBIT 3.91

                          ARTICLES OF ORGANIZATION FOR
                       FLORIDA LIMITED LIABILITY COMPANY


                                   ARTICLE I
                                      NAME

                  The name of the Limited Liability Company is: Richey Manor,
LLC.

                                   ARTICLE II
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee,
Wisconsin 53203.

                                  ARTICLE III
                                    DURATION

                  The period of duration for the Limited Liability Company shall
be: Unlimited/Perpetual.

                                   ARTICLE IV
                                   MANAGEMENT

                  The Limited Liability Company is to be managed by the members
and the name and address of the managing member is: Extendicare Health
Facilities, Inc., 111 West Michigan Street, Milwaukee, Wisconsin 53203.

                                   ARTICLE V
                         ADMISSION OF ADDITIONAL MEMBERS

                  The right, if given, of the members to admit additional
members and the terms and conditions of the admissions shall be: N/A.

                                   ARTICLE VI
                       MEMBERS RIGHTS TO CONTINUE BUSINESS

                  The right, if given, of the remaining members of the limited
liability company to continue the business on the death, retirement,
resignation, expulsion, bankruptcy, or dissolution of a member or the occurrence
of any other event which terminates the continued membership of a member in the
limited liability company shall be: None.

EX-3.92

                                                                    EXHIBIT 3.92

                            ARTICLES OF ORGANIZATION
                                       FOR
                        FLORIDA LIMITED LIABILITY COMPANY

                                   ARTICLE I.
                                      NAME

                  The name of the Limited Liability Company is: Rockledge Care,
LLC.

                                  ARTICLE II.
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee, WI
53203

                                  ARTICLE III.
                     REGISTERED AGENT, REGISTERED OFFICE, &
                          REGISTERED AGENT'S SIGNATURE

                  The name and the Florida street address of the registered
agent are:

                          Lexis Document Services, Inc.
                               3953 WW Kelley Road
                              Tallahassee, FL 32311

EX-3.93

                                                                    EXHIBIT 3.93


                            ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


                  The undersigned, desiring to form a limited liability Company,
under Chapter 1705 of the Ohio Revised Code, do hereby state the following:

                  FIRST:  The name of said limited liability company shall be:
Rockmill Care, LLC.

                  SECOND:  This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD:  The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is:  111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.94

                                                                EXHIBIT 3.94



                            ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


                  The undersigned, desiring to form a limited liability Company,
under Chapter 1705 of the Ohio Revised Code, do hereby state the following:

                  FIRST:  The name of said limited liability company shall be:
Rocksprings Care, LLC.

                  SECOND:  This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD:  The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is:  111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.95

                                                                    EXHIBIT 3.95

                          ARTICLES OF ORGANIZATION FOR
                       FLORIDA LIMITED LIABILITY COMPANY


                                    ARTICLE I
                                      NAME

                  The name of the Limited Liability Company is: Safety Harbor
Care, LLC.

                                   ARTICLE II
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee,
Wisconsin 53203.

                                   ARTICLE III
                                    DURATION

                  The period of duration for the Limited Liability Company shall
be: Unlimited/Perpetual.

                                   ARTICLE IV
                                   MANAGEMENT

                  The Limited Liability Company is to be managed by the members
and the name and address of the managing member is: Northern Health Facilities,
Inc., 111 West Michigan Street, Milwaukee, Wisconsin 53203.

                                    ARTICLE V
                         ADMISSION OF ADDITIONAL MEMBERS

                  The right, if given, of the members to admit additional
members and the terms and conditions of the admissions shall be: N/A.

                                   ARTICLE VI
                       MEMBERS RIGHTS TO CONTINUE BUSINESS

                  The right, if given, of the remaining members of the limited
liability company to continue the business on the death, retirement,
resignation, expulsion, bankruptcy, or dissolution of a member or the occurrence
of any other event which terminates the continued membership of a member in the
limited liability company shall be: None.

                                   ARTICLE VII
                    AFFIDAVIT OF MEMBERSHIP AND CONTRIBUTIONS

                  The undersigned member or authorized representative of a
member of Safety Harbor Care, LLC certifies:







                  1.   the above named limited liability company has at least
                       one member;

                  2.   the total amount of cash contributed by the member(s) is
                       $1,000;

                  3.   if any, the agreed value of property other than cash
                       contributed by member(s) is $0.00 (A description of the
                       property is attached and made a part hereto.); and

                  4.   the total amount of cash and property contributed and
                       anticipated to be contributed by member(s) is $1,000.



                                       2

EX-3.96

                                                                    EXHIBIT 3.96

                          ARTICLES OF ORGANIZATION FOR
                       FLORIDA LIMITED LIABILITY COMPANY


                                    ARTICLE I
                                      NAME

                  The name of the Limited Liability Company is: Sarasota Care,
LLC.

                                   ARTICLE II
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee,
Wisconsin 53203.

                                   ARTICLE III
                                    DURATION

                  The period of duration for the Limited Liability Company shall
be: Unlimited/Perpetual.

                                   ARTICLE IV
                                   MANAGEMENT

                  The Limited Liability Company is to be managed by the members
and the name and address of the managing member is: Northern Health Facilities,
Inc., 111 West Michigan Street, Milwaukee, Wisconsin 53203.

                                    ARTICLE V
                         ADMISSION OF ADDITIONAL MEMBERS

                  The right, if given, of the members to admit additional
members and the terms and conditions of the admissions shall be: N/A.

                                   ARTICLE VI
                       MEMBERS RIGHTS TO CONTINUE BUSINESS

                  The right, if given, of the remaining members of the limited
liability company to continue the business on the death, retirement,
resignation, expulsion, bankruptcy, or dissolution of a member or the occurrence
of any other event which terminates the continued membership of a member in the
limited liability company shall be: None.

                                   ARTICLE VII
                    AFFIDAVIT OF MEMBERSHIP AND CONTRIBUTIONS

                  The undersigned member or authorized representative of a
member of Sarasota Care, LLC certifies:







                  1.   the above named limited liability company has at least
                       one member;

                  2.   the total amount of cash contributed by the member(s) is
                       $1,000;

                  3.   if any, the agreed value of property other than cash
                       contributed by member(s) is $0.00 (A description of the
                       property is attached and made a part hereto.); and

                  4.   the total amount of cash and property contributed and
                       anticipated to be contributed by member(s) is $1,000.


                                       2

EX-3.97

                                                                    EXHIBIT 3.97

                          ARTICLES OF ORGANIZATION FOR
                       FLORIDA LIMITED LIABILITY COMPANY


                                    ARTICLE I
                                      NAME

                  The name of the Limited Liability Company is: Seminole Care,
LLC.

                                   ARTICLE II
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee,
Wisconsin 53203.

                                   ARTICLE III
                                    DURATION

                  The period of duration for the Limited Liability Company shall
be: Unlimited/Perpetual.

                                   ARTICLE IV
                                   MANAGEMENT

                  The Limited Liability Company is to be managed by the members
and the name and address of the managing member is: Northern Health Facilities,
Inc., 111 West Michigan Street, Milwaukee, Wisconsin 53203.

                                    ARTICLE V
                         ADMISSION OF ADDITIONAL MEMBERS

                  The right, if given, of the members to admit additional
members and the terms and conditions of the admissions shall be: N/A.

                                   ARTICLE VI
                       MEMBERS RIGHTS TO CONTINUE BUSINESS

                  The right, if given, of the remaining members of the limited
liability company to continue the business on the death, retirement,
resignation, expulsion, bankruptcy, or dissolution of a member or the occurrence
of any other event which terminates the continued membership of a member in the
limited liability company shall be: None.

                                   ARTICLE VII
                    AFFIDAVIT OF MEMBERSHIP AND CONTRIBUTIONS

                  The undersigned member or authorized representative of a
member of Seminole Care, LLC certifies:







                  1.   the above named limited liability company has at least
                       one member;

                  2.   the total amount of cash contributed by the member(s) is
                       $1,000;

                  3.   if any, the agreed value of property other than cash
                       contributed by member(s) is $0.00 (A description of the
                       property is attached and made a part hereto.); and

                  4.   the total amount of cash and property contributed and
                       anticipated to be contributed by member(s) is $1,000.


                                       2

EX-3.98

                                                                    EXHIBIT 3.98

                          ARTICLES OF ORGANIZATION FOR
                       FLORIDA LIMITED LIABILITY COMPANY


                                    ARTICLE I
                                      NAME

                  The name of the Limited Liability Company is: South Heritage
Health & Rehabilitation Center, LLC.

                                   ARTICLE II
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee,
Wisconsin 53203.

                                   ARTICLE III
                                    DURATION

                  The period of duration for the Limited Liability Company shall
be: Unlimited/Perpetual.

                                   ARTICLE IV
                                   MANAGEMENT

                  The Limited Liability Company is to be managed by the members
and the name and address of the managing member is: Extendicare Health
Facilities, Inc., 111 West Michigan Street, Milwaukee, Wisconsin 53203.

                                    ARTICLE V
                         ADMISSION OF ADDITIONAL MEMBERS

                  The right, if given, of the members to admit additional
members and the terms and conditions of the admissions shall be: N/A.

                                   ARTICLE VI
                       MEMBERS RIGHTS TO CONTINUE BUSINESS

                  The right, if given, of the remaining members of the limited
liability company to continue the business on the death, retirement,
resignation, expulsion, bankruptcy, or dissolution of a member or the occurrence
of any other event which terminates the continued membership of a member in the
limited liability company shall be: None.

EX-3.99

                                                                    EXHIBIT 3.99


                       CERTIFICATE OF LIMITED PARTNERSHIP

         In compliance with the requirements of the Delaware Limited Partnership
Act, Title 6, Chapter 17 of the Delaware Code (relating to certificate of
limited partnership), the undersigned, desiring to form a limited partnership,
hereby certifies that:

1.       The name of the limited partnership is:     Stonebridge Care, LP

2.       The address of this limited partnership's initial registered office is:


         111 West Michigan Street,       Milwaukee,       WI              53203              Milwaukee
         -------------------------------------------------------------------------------------------------
            Number and Street              City          State             Zip                County



3.       The address of this limited partnership's registered agent upon whom
         process may be served is:


         Lexis Document Services Inc.
         30 Old Rudnick Lane, Suite 100,      Dover,        DE            19901             Kent
         --------------------------------------------------------------------------------------------------
             Number and Street                City         State           Zip            County



4.       The name and business address of each general partner of the
         partnership is:


         Name                               Address

         Coventry Care Holdings, Inc.       111 West Michigan Street, Milwaukee, WI  53203




5.       The formation of the limited partnership shall be effective upon filing
         this Certificate of Limited Partnership with the Office of the
         Secretary of State.

EX-3.100

                                                                   EXHIBIT 3.100

                          ARTICLES OF ORGANIZATION FOR
                        FLORIDA LIMITED LIABILITY COMPANY


                                   ARTICLE I
                                      NAME

                  The name of the Limited Liability Company is: The Oaks
Residential and Rehabilitation Center, LLC.

                                   ARTICLE II
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee,
Wisconsin 53203.

                                  ARTICLE III
                                    DURATION

                  The period of duration for the Limited Liability Company shall
be: Unlimited/Perpetual.

                                   ARTICLE IV
                                   MANAGEMENT

                  The Limited Liability Company is to be managed by the members
and the name and address of the managing member is: Extendicare Health
Facilities, Inc., 111 West Michigan Street, Milwaukee, Wisconsin 53203.

                                   ARTICLE V
                         ADMISSION OF ADDITIONAL MEMBERS

                  The right, if given, of the members to admit additional
members and the terms and conditions of the admissions shall be: N/A.

                                   ARTICLE VI
                       MEMBERS RIGHTS TO CONTINUE BUSINESS

                  The right, if given, of the remaining members of the limited
liability company to continue the business on the death, retirement,
resignation, expulsion, bankruptcy, or dissolution of a member or the occurrence
of any other event which terminates the continued membership of a member in the
limited liability company shall be: None.

EX-3.101

                                                                   EXHIBIT 3.102

                            ARTICLES OF INCORPORATION
                                       OF
                        THE PROGRESSIVE STEP CORPORATION

                  The undersigned, acting as incorporator under the Wisconsin
Business Corporation Law, Chapter 180 of the Wisconsin Statutes, adopts the
following Articles of Incorporation.

                                   ARTICLE I
                                      NAME

                  The name of the corporation shall be The Progressive Step
Corporation.

                                   ARTICLE II
                                    DIRECTORS

                  The number of directors shall be as provided in the by-laws of
the corporation.

                                  ARTICLE III
                           REGISTERED AGENT AND OFFICE

                  The address of the initial registered office of the
corporation and the name of the initial registered agent of the corporation at
such address are: Roch Carter, 105 West Michigan Street, Milwaukee, Wisconsin
53203.

                                   ARTICLE IV
                                  INCORPORATOR

                  The name and address of the incorporator is: Lori A. Henley,
Esq., 105 West Michigan Street, Milwaukee, Wisconsin 53203.

                                   ARTICLE V
                                    AMENDMENT

                  These Articles may be amended in the manner authorized by law
at the time of amendment.

                                   ARTICLE VI
                                     SHARES

                  The aggregate number of shares of stock which the corporation
shall have authority to issue shall be Nine Thousand (9,000) shares of common
stock of the par value of One Dollar ($1.00) per share.

                  The Board of Directors of the corporation may, within the
limits and in the manner set forth in the Wisconsin Business Corporation Law,
determine, with respect to any class of shares, the preferences, limitations and
relative rights, in whole or in part, before the issuance of such shares.






                  The Board of Directors may further create one or more series
within a class of stock, and, with respect to any such series, determine the
number of shares of such series, the distinguishing designation and the
preferences, limitations and relative rights, in whole or in part, before the
issuance of any shares of that series.

                                  ARTICLE VII
                            CONSIDERATION FOR SHARES

                  The corporation's authority to issue shares of the
corporation's capital stock for consideration other than cash or tangible
property and to place such shares in escrow and make other arrangements to
restrict their transfer or concerning payment of the consideration for such
shares, all in accordance with the Wisconsin Business Corporation Law, shall be
reserved to the shareholders of the corporation.

                                  ARTICLE VIII
                                  STOCK RIGHTS

                  Except as may be limited by the Wisconsin Business Corporation
Law, the holders of capital stock of the corporation shall have preemptive
rights to acquire the corporation's unissued shares of such capital stock.







                                       2

EX-3.102

                                                                   EXHIBIT 3.102

                                     BYLAWS

                                       OF

                        THE PROGRESSIVE STEP CORPORATION

                                   ARTICLE I.
                                    OFFICES

                  Section 1.01 PRINCIPAL AND BUSINESS OFFICES. The corporation
may have such principal and other business offices, either within or without the
State of Wisconsin, as the Board of Directors may designate or as the business
of the corporation may require from time to time.

                  Section 1.02 REGISTERED OFFICE. The registered office of the
corporation required by the Wisconsin Statutes to be maintained in the State of
Wisconsin may be, but need not be, identical with the principal office in the
State of Wisconsin, and the address of the registered office may be changed from
time to time in the manner permitted by Wisconsin Statutes. The business office
of the registered agent of the corporation shall be identical to such registered
office.

                                   ARTICLE II.
                                  SHAREHOLDERS

                  Section 2.01 ANNUAL MEETING. The annual meeting of the
shareholders shall be held during the fourth week of March in each year at a
time and date to be determined by or under the authority of the Board of
Directors, for the purpose of electing directors and for the transaction of such
other business as may come before the meeting. If the day fixed for the annual
meeting shall be a legal holiday in the State of Wisconsin, such meeting shall
be held on the next succeeding business day. If the election of directors shall
not be held on the day designated herein, or fixed as herein provided, for any
annual meeting of the shareholders, or at any continued session thereof, the
Board of Directors shall cause the election to be held at a special meeting of
the shareholders as soon thereafter as convenient.

                  Section 2.02 SPECIAL MEETING. Special meetings of the
shareholders for any purpose or purposes, unless otherwise prescribed by
statute, may be called by the President or the Board of Directors or by the
person designated in the written request of the holders of not less than
one-tenth (1/10) of all shares of the corporation entitled to vote at the
meeting.

                  Section 2.03 PLACE OF MEETING. The Board of Directors may
designate any place, either within or without the State of Wisconsin, as the
place of meeting for any annual meeting or for any special meeting called by the
Board of Directors. A waiver of notice signed by all shareholders entitled to
vote at a meeting may designate any place, either within or without the State of
Wisconsin, as the place for the holding of such meeting. If no designation is
made, or if a special meeting be otherwise called the place of meeting shall be
the principal business office of the corporation in the State of Wisconsin or
such other suitable place in the county of such principal office as may be
designated by the person calling such meeting, but any meeting





may be adjourned to reconvene at any place designated by vote of a majority of
the shares represented thereat.

                  Section 2.04 NOTICE OF MEETING. Written notice stating the
place, day and hour of the meeting and, in case of a special meeting, the
purpose or purposes for which the meeting is called, shall be delivered not less
than ten (10) days nor more than fifty (50) days before the date of the meeting,
by or at the direction of the President, or the Secretary, or other officer or
persons calling the meeting, to each shareholder of record entitled to vote at
such meeting.

                  Whenever any notice is required to be given to any shareholder
to whom communication is made unlawful by any law of the United States, whenever
enacted, or by any rule, regulation, proclamation or executive order issued
under any such law, the giving of such notice to such shareholder shall not be
required and there shall be no duty to apply to any governmental authority or
agency for a license or permit to give such notice to such shareholder.

                  Section 2.05 FIXING OF RECORD DATE. For the purpose of
determining shareholders entitled to notice of or to vote at any meeting of
shareholders or any adjournment thereof, or shareholders entitled to receive
payment of any distribution or dividend, or in order to make a determination of
shareholders for any other proper purpose, the board of directors may provide
that the stock transfer books shall be closed for a stated period but not to
exceed, in any case, fifty (50) days. If the stock transfer books shall be
closed for the purpose of determining shareholders entitled to notice of or to
vote at a meeting of shareholders, such books shall be closed for at least ten
(10) days immediately preceding such meeting. In lieu of closing the stock
transfer books, the Board of Directors may fix in advance a date as the record
date. Such record date shall not be more than seventy (70) days prior to the
date on which the particular action, requiring such determination of
shareholders, is to be taken. If no record date is so fixed by the board for the
determination of shareholders entitled to notice of, or to vote at a meeting of
shareholders, or shareholders entitled to receive payment of a dividend or a
distribution, the record date for such determination of shareholders shall be at
the close of business on: (a) With respect to an annual shareholder meeting or
any special shareholder meeting called by the board or any person specifically
authorized by the board or these By-laws to call a meeting, the day before the
first notice is delivered to shareholders; (b) With respect to a special
shareholder's meeting demanded by the shareholders, the date the first
shareholder signs the demand; (c) With respect to the payment of a share
dividend, the date the board authorized the share dividend; (d) With respect to
actions taken in writing without a meeting, the date the first shareholder signs
a consent; and (e) With respect to a distribution to shareholders, (other than
one involving a repurchase or reacquisition of shares), the date the board
authorizes the distribution. When a determination of shareholders entitled to
vote at any meeting of shareholders has been made as provided in this section,
such determination shall be applied to any adjournment thereof unless the board
of directors fixes a new record date which it must do if the meeting is
adjourned to a date more than one hundred twenty (120) days after the date fixed
for the original meeting.

                  Section 2.06 SHAREHOLDER LIST. The officer or agent having
charge of the stock transfer books for shares of the corporation shall, before
each meeting of the shareholders, make a complete record of the shareholders
entitled to vote at such meeting, or any adjournment thereof, arranged in
alphabetical order, with the address of and the number of shares held by





each. The list must be arranged by voting group, if such exists, and within each
voting group by class or series of shares. The shareholder list must be
available for inspection by any shareholder, beginning two (2) business days
after notice of the meeting is given for which the list was prepared and
continuing through the meeting. The list shall be available at the corporation's
principal office or at a place identified in the meeting notice in the city
where the meeting is to be held. A shareholder, his or her agent, or attorney is
entitled on written demand to inspect and, in a manner consistent with the
Wisconsin Business Corporation Law and these By-Laws, may copy the list during
regular business hours and at his or her expense, during the period it is
available for inspection. The corporation shall maintain the shareholder list in
written form or in another form capable of conversion into written form within a
reasonable time. Failure to comply with the requirements of this section shall
not affect the validity of any action taken at such meeting.

                  Section 2.07 QUORUM. Except as otherwise provided in the
Articles of Incorporation, a majority of the shares entitled to vote,
represented in person or by proxy, shall constitute a quorum at a meeting of
shareholders. If a quorum is present, the affirmative vote of the majority of
the shares represented at the meeting and entitled to vote on the subject matter
shall be the act of the shareholders unless the vote of a greater number or
voting by voting groups or classes is required by law or the Articles of
Incorporation. Though less than a quorum of the outstanding shares are
represented at a meeting, a majority of the shares so represented may adjourn
the meeting from time to time without further notice. At such adjourned meeting
at which a quorum shall be present or represented, any business may be
transacted which might have been transacted at the meeting as originally
noticed. If the Articles of Incorporation or the Wisconsin Business Corporation
Law provides for voting by a voting group(s) on a matter, action on that matter
is taken when voted upon by that voting group(s). Shares entitled to vote as a
separate voting group(s) may take action on a matter at a meeting only if a
quorum of those shares exists with respect to that matter. Unless the Articles
of Incorporation or the Wisconsin Business Corporation Law provides otherwise, a
majority of the votes entitled to be cast on the matter by the voting group
constitutes a quorum of that voting group for action on that matter. Once a
share is represented for any purpose at a meeting, it is deemed present for
quorum purposes for the remainder of the meeting and for any adjournment of that
meeting unless a new record date is or must be set for that adjourned meeting.

                  Section 2.08 CONDUCT OF MEETINGS. The President, and in his or
her absence, a Vice President in the order provided under Section 4.08, and in
their absence, any person chosen by the shareholders present shall call the
meeting of the shareholders to order and shall act as chairman of the meeting,
and the Secretary of the corporation shall act as secretary of all meetings of
the shareholders, but, in the absence of the Secretary, the presiding officer
may appoint any other person to act as secretary of the meeting.

                  Section 2.09 PROXIES. At all meetings of shareholders, a
shareholder entitled to vote may vote in person or by proxy appointed in writing
by the shareholder or by his or her duly authorized attorney in fact. Such proxy
shall be filed with the Secretary of the corporation or other officer or agent
of the corporation authorized to tabulate votes before or at the time of the
meeting. Unless the proxy appointment conspicuously states that it is
irrevocable and the proxy appointment is coupled with an interest, a proxy may
be revoked at any time before it is voted, either by written notice filed with
the Secretary or the acting secretary of the meeting or




by oral notice given by the shareholder to the presiding officer during the
meeting. The presence of a shareholder who has filed his or her proxy shall not
of itself constitute a revocation. No proxy shall be valid after eleven months
from the date of its execution, unless otherwise provided in the proxy. The
board of directors shall have the power and authority to make rules establishing
presumptions as to the validity and sufficiency of proxies.

                  Section 2.10 VOTING OF SHARES. Each outstanding share shall be
entitled to one vote upon each matter submitted to a vote at a meeting of
shareholders, except to the extent that cumulative voting in the election of
directors is provided for in the Articles of Incorporation or the voting rights
of the shares of any class or classes are otherwise enlarged, limited or denied
by the Articles of Incorporation.

                  Section 2.11 WAIVER OF NOTICE BY SHAREHOLDERS. Whenever any
notice whatever is required to be given to any shareholder of the corporation
under the Articles of Incorporation or By-laws or any provision of law, a waiver
thereof in writing, signed at any time, whether before or after the time of
meeting, by the shareholder entitled to such notice, shall be deemed equivalent
to the giving of such notice; provided that such waiver in respect to any matter
of which notice is required under any provision of the Wisconsin Business
Corporation Law, shall contain the same information as would have been required
to be included in such notice, except the time and place of meeting. A
shareholder's attendance at a meeting in person or by proxy waives any objection
to (a) notice of the meeting unless the shareholder raises the objection at the
beginning of the meeting or promptly upon arrival at the meeting; and (b)
consideration of a particular matter at the meeting that is not within the
purpose described in the meeting notice, unless the shareholder objects to
considering the matter when it is presented.

                  Section 2.12 UNANIMOUS CONSENT WITHOUT MEETING. Any action
required or permitted by the Articles of Incorporation or By-laws or any
provision of law to be taken at a meeting of the shareholders, may be taken
without a meeting if a consent in writing, setting forth the action so taken,
shall be signed by all of the shareholders entitled to vote with respect to the
subject matter thereof and such consent is delivered to the corporation for
inclusion in the minute book. If the act to be taken requires that notice be
given to non-voting shareholders, the corporation shall give the non-voting
shareholders written notice of the proposed action at least ten (10) days before
the action is taken, which notice shall contain or be accompanied by the same
material that would have been required if a formal meeting had been called to
consider the action. A consent signed under this section has the effect of a
meeting vote and may be described as such in any document. Action without a
meeting may not be taken where the action is the election of Directors for which
the shareholders may vote cumulatively.

                  Section 2.13 TELEPHONE MEETINGS. Shareholders may participate
in and hold meetings by means of a conference telephone or similar
communications arrangement by means of which all shareholders participating in
the meeting can simultaneously hear each other, all communication during the
meeting is immediately transmitted to all shareholders participating, and each
participating shareholder is able to immediately send messages to all other
participating shareholders. Each Shareholder's identity shall be confirmed prior
to the transaction of any business at the meeting by each shareholder stating
his or her name, address as it appears on the records of the corporation, and
social security number. Participation in such a meeting shall constitute
presence in person at the meeting, except where a person participates in




the meeting for the sole and express purpose of objecting to the transaction of
any business on the ground that the meeting is not lawfully called or convened.

                  Section 2.14 VOTING FOR DIRECTORS. Unless otherwise provided
in the Articles of Incorporation, directors are elected by a plurality of the
votes cast by the shares entitled to vote in the election at a meeting at which
a quorum is present.

                                  ARTICLE III.
                               BOARD OF DIRECTORS

                  Section 3.01 GENERAL POWERS AND NUMBER. The number of
authorized Directors of the Corporation shall be not less than 1 nor more than
15, fixed from time to time by the Shareholders. The Directors shall be elected
at the annual meeting of the Shareholders and each Director shall be elected to
serve until his successor shall be elected and shall qualify.

                  Section 3.02 TENURE AND QUALIFICATIONS. Each Director shall
hold office until the next annual meeting of shareholders and until his or her
successor shall have been elected, or until his or her prior death, resignation
or removal. A Director may be removed from office by affirmative vote of a
majority of the outstanding shares entitled to vote for the election of such
Director, taken at a meeting of shareholders called for that purpose as provided
in Section 3.09. A Director may resign at any time by filing his or her written
resignation with the Secretary of the corporation. Directors need not be
residents of the State of Wisconsin or shareholders of the corporation.

                  Section 3.03 REGULAR MEETINGS. A regular meeting of the Board
of Directors shall be held without other notice than this By-law immediately
after, and at the same place as, the annual meeting of shareholders, or such
other suitable place as may be announced at such meeting of shareholders, and
each adjourned session thereof. The Board of Directors may provide, by
resolution, the time and place, either within or without the State of Wisconsin,
for the holding of additional regular meetings without other notice than such
resolution.

                  Section 3.04 SPECIAL MEETINGS. Special meetings of the Board
of Directors may be called by or at the request of the President, Secretary or
any one (1) director. The person authorized to call any special meeting of the
Board of Directors may fix any place, either within or without the State of
Wisconsin, as the place for holding any special meeting of the Board of
Directors called by such person, and if no other place is fixed the place of
meeting shall be the principal business office of the corporation in the State
of Wisconsin.

                  Section 3.05 NOTICE; WAIVER. Notice of each special meeting of
the Board of Directors shall be given by written notice delivered personally or
mailed or given by facsimile to each director at his or her business address or
at such other address as such director shall have designated in writing filed
with the Secretary, not less than forty-eight (48) hours if by mail and not less
than six (6) hours if delivered orally, or by facsimile, telegram, or by
personal delivery. If mailed, such notice shall be deemed to be delivered when
deposited in the United States mail so addressed, with postage thereon prepaid.
Whenever any notice whatever is required to be given to any director of the
corporation under the Articles of Incorporation or By-laws or any




provision of law, a waiver thereof in writing, signed at any time, whether
before or after the time of meeting, by the director entitled to such notice,
shall be deemed equivalent to the giving of such notice. The attendance of a
director at a meeting shall constitute a waiver of notice of such meeting,
except where a director attends a meeting and objects thereat to the transaction
of any business because the meeting is not lawfully called or convened. Neither
the business to be transacted at, nor the purpose of any regular or special
meeting of the Board of Directors need be specified in the notice or waiver of
notice of such meeting.

                  Section 3.06 QUORUM. Except as otherwise provided by law or by
the Articles of Incorporation or these By-laws, a majority of the directors
shall constitute a quorum for the transaction of business at any meeting of the
Board of Directors, but a majority of the directors present (though less than
such quorum) may adjourn the meeting from time to time without further notice.

                  Section 3.07 MANNER OF ACTING. The act of the majority of the
directors present at a meeting at which a quorum is present shall be the act of
the Board of Directors, unless the act of a greater number is required by law or
by the Articles of Incorporation or these By-laws.

                  Section 3.08 CONDUCT OF MEETINGS. The Chairman of the Board,
if there be one and he or she is present, or the President, and in his or her
absence the Executive Vice President, or in his or her absence, a Vice President
in the order provided under Section 4.08, and in their absence, any director
chosen by the directors present, shall call meetings of the Board of Directors
to order and shall act as chairman of the meeting. The Secretary of the
corporation shall act as secretary of all meetings of the Board of Directors,
but in the absence of the Secretary, the presiding officer may appoint any
Assistant Secretary or any director or other person present to act as Secretary
of the meeting.

                  Section 3.09 REMOVAL OF DIRECTORS. The shareholders may remove
one or more directors at a meeting called for that purpose and the meeting
notice shall state that a purpose of the meeting is such removal. The removal
may be with or without cause unless the Articles of Incorporation provide that
directors may only be removed with cause. If a director is elected by a voting
group of shareholders, only the shareholders, of that voting group may
participate in the vote to remove him or her. A director elected by cumulative
voting may not be removed if the number of votes sufficient to elect him or her
under cumulative voting is voted against his or her removal. If cumulative
voting is not authorized, a director may be removed only if the number of votes
cast to remove him or her exceeds the number of votes cast not to remove him or
her unless the Articles of Incorporation provide for a greater voting
requirement.

                  Section 3.10 VACANCIES. Unless the Articles of Incorporation
provide otherwise, any vacancy occurring in the Board of Directors, including a
vacancy created by an increase in the number of directors, may be filled until
the next succeeding annual election by either the affirmative vote of the
shareholders or the affirmative vote of a majority of the directors then in
office; provided, that if the vacant office was held by a director elected by a
voting group of shareholders, only the holders of shares of that voting group
may vote to fill the vacancy if it is filled by the shareholders, and only the
remaining directors elected by that voting group may vote to fill the vacancy if
it is filled by the directors. A vacancy that will occur at a




specific later date, because of a resignation effective at a later date may be
filled before the vacancy occurs, but the new director may not take office until
the vacancy occurs.

                  Section 3.11 COMPENSATION. The Board of Directors,
irrespective of any personal interest of any of its members, may establish
reasonable compensation of all directors for services to the corporation as
directors, officers or otherwise, or may delegate such authority to an
appropriate committee. The Board of Directors also shall have authority to
provide for or to delegate authority to an appropriate committee to provide for
reasonable pensions, disability or death benefits, and other benefits or
payments, to directors, officers and employees and to their estates, families,
dependents or beneficiaries on account of prior services rendered by such
directors, officers, and employees to the corporation.

                  Section 3.12 PRESUMPTION OF ASSENT. A director of the
corporation who is present at a meeting of the Board of Directors or a committee
thereof of which he is a member at which action on any corporate matter is taken
shall be presumed to have assented to the action taken unless the director
objects at the beginning of the meeting or promptly upon his or her arrival to
holding the meeting or transacting business at the meeting, or unless his or her
dissent shall be entered in the minutes of the meeting or unless the Director
shall file his or her written dissent to such action with the person acting as
the Secretary of the meeting before or immediately after the adjournment
thereof. Such right to dissent shall not apply to a director who voted in favor
of such action.

                  Section 3.13 COMMITTEES. The Board of Directors by resolution
adopted by the affirmative vote of the greater of a majority of the Directors
then in office or the number of Directors required under the Articles of
Incorporation or these By-laws to take valid corporate action, may designate one
or more committees, each committee to consist of two or more directors elected
by the Board of Directors, which to the extent provided in said resolution as
initially adopted, and as thereafter supplemented or amended by further
resolution adopted by a like vote, shall have and may exercise, when the Board
of Directors is not in session, the powers of the Board of Directors in the
management of the business and affairs of the corporation, except that no such
committee may (a) authorize distributions, (b) approve or propose to
shareholders any action that the Wisconsin Business Corporation Law requires be
approved by shareholders, (c) fill vacancies on the Board of Directors or,
except as authorized by the Board of Directors, fill vacancies on any committee
of the Board of Directors, (d) amend the Articles of Incorporation, (e) adopt,
amend or repeal By-Laws, (f) approve a plan of merger not requiring shareholder
approval, (g) authorize or approve reacquisition of shares, except according to
a formula or method prescribed by the Board of Directors, or (h) authorize or
approve the issuance or sale or contract for sale of shares, or determine the
designation and relative rights, preferences and limitations of a class or a
series of shares, except that the Board of Directors may authorize a committee
or a senior executive officer of the corporation to do so within limits
prescribed by the Board of Directors. The Board of Directors may elect one or
more of its members as alternate members of any such committee who may take the
place of any absent member or members at any meeting of such committee, upon
request by the President or upon request by the chairman of such meeting. Each
such committee shall fix its own rules governing the conduct of its activities
and shall make reports to the Board of Directors of its activities as the Board
of Directors may request.




                  Section 3.14 UNANIMOUS CONSENT WITHOUT MEETING. Any action
required or permitted by the Articles of Incorporation or By-laws or any
provision of law to be taken by the Board of Directors or committee thereof at a
meeting or by resolution may be taken without a meeting if a consent in writing,
setting forth the action so taken, shall be signed by all of the directors or
members of the committee then in office. A signed consent has the effect of a
meeting vote and may be described as such in any document.

                  Section 3.15 TELEPHONE MEETINGS. Directors may participate in
and hold meetings by means of a conference telephone or similar communications
arrangement by means of which all Directors participating in the meeting can
simultaneously hear each other, all communication during the meeting is
immediately transmitted to all Directors participating, and each participating
Director is able to immediately send messages to all other participating
Directors. Each Director's identity shall be verified prior to voting on action
at the meeting by each Director stating his or her name, address as it appears
on the records of the corporation, and social security number. Participation in
such a meeting shall constitute presence in person at the meeting, except where
a Director participates in the meeting for the sole and express purpose of
objecting to the transaction of any business on the ground that the meeting is
not lawfully called or convened.

                                   ARTICLE IV.
                                    OFFICERS

                  Section 4.01 NUMBER. The principal officers of the corporation
shall be a President, one (1) or more Vice Presidents, a Secretary and a
Treasurer, each of whom shall be elected by the Board of Directors. The Board of
Directors may designate one of the Vice Presidents as the Executive Vice
President. Such other officers and assistant officers as may be deemed necessary
may be elected or appointed by the Board of Directors. If specifically
authorized by the Board of Directors, an officer may appoint one or more
officers or assistant officers. The same individual may simultaneously hold more
than one office in the corporation.

                  Section 4.02 ELECTION AND TERN OF OFFICE. The officers of the
corporation shall be elected annually by the Board of Directors at the first
meeting of the Board of Directors held after each annual meeting of the
shareholders. If the election of officers shall not be held at such meeting,
such election shall be held as soon thereafter as convenient. Each officer may
hold office until his or her successor shall have been duly elected or until his
or her prior death, resignation or removal.

                  Section 4.03 REMOVAL. Any officer or agent may be removed by
the Board of Directors at any time, with or without cause, and notwithstanding
the contract rights, if any, of the person so removed. Any officer or assistant
officer appointed by another officer in accordance with these By-laws may be
removed by the officer who made the appointment at any time, with or without
cause, and notwithstanding the contract rights, if any, of the officer or
assistant officer so removed. Election or appointment shall not of itself create
contract rights.

                  Section 4.04 VACANCIES. A vacancy in any principal office
because of death, resignation, removal, disqualification or otherwise, may be
filled by the Board of Directors for the unexpired portion of the term.




                  Section 4.05 CHAIRMAN OF THE BOARD. The Board of Directors may
elect one of its members the Chairman of the Board. The Chairman of the Board
shall preside at all meetings of the shareholders and directors at which he is
present. He shall be ex officio a member of all standing committees and shall be
Chairman of such committees as is determined by the Board of Directors. He shall
have such other powers and duties as may from time to time be prescribed by the
By-laws or by resolution of the Board of Directors.

                  Section 4.06 PRESIDENT. The President shall be the principal
executive officer of the corporation and, subject to the control of the Board of
Directors, shall in general supervise and control all of the business and
affairs of the corporation. He shall, when present, preside at all meetings of
the shareholders and of the Board of Directors subject to Section 3.08. He shall
have authority, subject to such rules as may be prescribed by the Board of
Directors, to appoint such agents and employees of the corporation as he shall
deem necessary, to prescribe their powers, duties and compensation, and to
delegate authority to them. Such agents and employees shall hold office at the
discretion of the President. He shall have authority to sign, execute and
acknowledge, on behalf of the corporation, all deeds, mortgages, bonds, stock
certificates, contracts, leases, reports and all other documents or instruments
necessary or proper to be executed in the course of the corporation's regular
business, or which shall be authorized by resolution of the Board of Directors;
and, except as otherwise provided by law or the Board of Directors, he may
authorize any Vice President or other officer or agent of the corporation to
sign, execute and acknowledge such documents or instruments in his or her place
and stead. In general, he shall perform all duties incident to the office of
President and such other duties as may be prescribed by the Board of Directors
from time to time.

                  Section 4.07 THE EXECUTIVE VICE PRESIDENT. The Executive Vice
President, if one be designated, shall assist the President in the discharge of
supervisory, managerial and executive duties and functions. In the absence of
the President or in the event of his or her death, inability or refusal to act,
the Executive Vice President shall perform the duties of the President and when
so acting shall have all the powers and duties of the President. The Executive
Vice President shall perform such other duties as from time to time may be
assigned to him or her by the Board of Directors or the President.

                  Section 4.08 THE VICE PRESIDENTS. In the absence of the
President and the Executive Vice President or in the event of their death,
inability or refusal to act, or in the event for any reason it shall be
impracticable for them to act personally, the Vice President (or in the event
there be more than one Vice President, the Vice Presidents in the order
designated by the Board of Directors, or in the absence of any designation, then
in the order of their election) shall perform the duties of the President, and
when so acting shall have all the powers of and be subject to all the
restrictions upon the President. Any Vice President may sign, with the Secretary
or Assistant Secretary, certificates for shares of the corporation; and shall
perform such other duties and have such authority as from time to time may be
delegated or assigned to him or her by the President or by the Board of
Directors. The execution of any instrument of the corporation by any Vice
President shall be conclusive evidence, as to third parties, of his or her
authority to act in the stead of the President. Vice Presidents may be
designated as the Vice President of a specified division, department or portion
of the corporation's business.




                  Section 4.09 THE SECRETARY. The Secretary shall: (a) keep the
minutes of the meetings of the shareholders and of the Board of Directors in one
or more books provided for that purpose; (b) see that all notices are duly given
in accordance with the provisions of these By-laws or as required by law; (c) be
custodian of the corporate records and of the seal of the corporation and see
that the seal of the corporation is affixed to all documents the execution of
which on behalf of the corporation under its seal is duly authorized; (d) keep
or arrange for the keeping of a register of the post office address of each
shareholder which shall be furnished to the Secretary by such shareholder; (e)
sign with the President, or a Vice President, certificates for shares of the
corporation, the issuance of which shall have been authorized by resolution of
the Board of Directors; (f) have general charge of the stock transfer books of
the corporation; and (g) in general perform all duties incident to the office of
Secretary and have such other duties and exercise such authority as from time to
time may be delegated or assigned to him or her by the President or by the Board
of Directors.

                  Section 4.10 THE TREASURER. The Treasurer shall: (a) have
charge and custody of and be responsible for all funds and securities of the
corporation; (b) receive and give receipts for moneys due and payable to the
corporation from any source whatsoever, and deposit all such moneys in the name
of the corporation in such banks, trust companies or other depositories as shall
be selected in accordance with the provisions of Section 5.04; and (c) in
general perform all of the duties incident to the office of Treasurer and have
such other duties and exercise such other authority as from time to time may be
delegated or assigned to him or her by the President or by the Board of
Directors. If required by the Board of Directors, the Treasurer shall give a
bond for the faithful discharge of his or her duties in such sum and with such
surety or sureties as the Board of Directors shall determine.

                  Section 4.11 ASSISTANT SECRETARIES AND ASSISTANT TREASURERS.
There shall be such number of Assistant Secretaries and Assistant Treasurers as
the Board of Directors or the President may from time to time authorize. The
Assistant Secretaries may sign with the President or a Vice President
certificates for shares of the corporation, the issuance of which shall have
been authorized by a resolution of the Board of Directors. The Assistant
Treasurers shall, if required by the Board of Directors, give bonds for the
faithful discharge of their duties in such sums and with such sureties as the
Board of Directors shall determine. The Assistant Secretaries and Assistant
Treasurers, in general, shall perform such duties and have such authority as
shall from time to time be delegated or assigned to them by the Secretary or the
Treasurer, respectively, or by the President or the Board of Directors.

                  Section 4.12 OTHER ASSISTANTS AND ACTING OFFICERS. The Board
of Directors and the President shall have the power to appoint any person to act
as assistant to any officer, or as agent for the corporation in his or her
stead, or to perform the duties of such officer whenever for any reason it is
impracticable for such officer to act personally, and such assistant or acting
officer or other agent so appointed by the Board of Directors shall have the
power to perform all the duties of the office to which he is so appointed to be
assistant, or as to which he is so appointed to act, except as such power may be
otherwise defined or restricted by the Board of Directors.




                                   ARTICLE V.
                            CONTRACTS, LOANS, CHECKS
                      AND DEPOSITS; SPECIAL CORPORATE ACTS

                  Section 5.01 CONTRACTS. The Board of Directors may authorize
any officer or officers, agent or agents, to enter into any contract or execute
or deliver any instrument in the name of and on behalf of the corporation, and
such authorization may be general or confined to specific instances. In the
absence of other designation, all deeds, mortgages and instruments of assignment
or pledge made by the corporation shall be executed in the name of the
corporation by the President or one of the Vice Presidents and by the Secretary,
an Assistant Secretary, the Treasurer or an Assistant Treasurer; the Secretary
or an Assistant Secretary, when necessary or required, shall affix the corporate
seal thereto; and when so executed no other party to such instrument or any
third party shall be required to make any inquiry into the authority of the
signing officer or officers.

                  Section 5.02 LOANS. No indebtedness for borrowed money shall
be contracted on behalf of the corporation and no evidences of indebtedness
shall be issued in its name unless authorized by or under the authority of a
resolution of the Board of Directors. Such authorization may be general or
confined to specific instances.

                  Section 5.03 CHECKS, DRAFTS, ETC. All checks, drafts or other
orders for payment of money, notes or other evidences of indebtedness issued in
the name of the corporation, shall be signed by such officer or officers, agent
or agents of the corporation and in such manner as shall from time to time be
determined by or under the authority of a resolution of the Board of Directors.

                  Section 5.04 DEPOSITS. All funds of the corporation not
otherwise employed shall be deposited from time to time to the credit of the
corporation in such banks, trust companies or other depositories as may be
selected by or under the authority of a resolution of the Board of Directors.

                  Section 5.05 VOTING OF SECURITIES OWNED BY THIS CORPORATION.
Subject always to the specific directions of the Board of Directors, (a) any
shares or other securities issued by any other corporation and owned or
controlled by this corporation may be voted at any meeting of security holders
of such other corporation by the President of this corporation if he or she be
present, or in his or her absence by the Executive Vice President if there be
one and he or she is present, or in his or her absence by any Vice President of
this corporation who may be present and (b) whenever, in the judgment of the
President or in his or her absence, the Executive Vice President if there be
one, or in his or her absence any Vice President, it is desirable for this
corporation to execute a proxy or written consent with respect to any shares or
other securities issued by any other corporation and owned by this corporation,
such proxy or consent shall be executed in the name of this corporation by the
President, the Executive Vice President, or one of the Vice Presidents of this
corporation without necessity of any authorization by the Board of Directors,
affixation of corporate seal or countersignature or attestation by another
officer. Any person or persons designated in the manner above stated as the
proxy or proxies of this corporation shall have full right, power and authority
to vote the




shares or other securities issued by such other corporation and owned by this
corporation the same as such shares or other securities might be voted by this
corporation.

                                  ARTICLE VI.
                   CERTIFICATES FOR SHARES AND THEIR TRANSFER

                  Section 6.01 CERTIFICATES FOR SHARES. Certificates
representing shares of the corporation shall be in such form, consistent with
law, as shall be determined by the Board of Directors. Such certificates shall
be signed by the President, the Executive Vice President, or a Vice President
and by the Secretary or an Assistant Secretary. All certificates for shares
shall be consecutively numbered or otherwise identified. The name and address of
the person to whom the shares represented thereby are issued, with the number of
shares and date of issue, shall be entered on the stock transfer books of the
corporation. If the corporation is authorized to issue different classes of
shares or different series within a class, the designations, relative rights,
preferences, and limitations applicable to each class and the variations in
rights, preferences, and limitations determined for each series (and the
authority of the Board of Directors to determine variations for future series)
must be summarized on the front or back of each certificate. Alternatively, each
certificate may state conspicuously on its front or back that the corporation
will furnish the shareholder this information on request in writing and without
charge. All certificates surrendered to the corporation for transfer shall be
canceled and no new certificate shall be issued until the former certificate for
a like number of shares shall have been surrendered and canceled, except as
provided in Section 6.06.

                  Section 6.02 SHARES WITHOUT CERTIFICATES. Unless the Articles
of Incorporation provide otherwise, the Board of Directors may authorize the
issuance the shares of any or all of classes or series of authorized shares of
stock of this corporation, without certificates. The authorization to issue
shares without certificates does not affect shares already represented by
certificates until they are surrendered to the corporation. Within a reasonable
time after the issuance or transfer of shares without certificates, the
corporation shall send the shareholder a written statement containing such
information as may be required by law.

                  Section 6.03 FACSIMILE SIGNATURES AND SEAL. The seal of the
corporation on any certificates for shares may be a facsimile. The signatures of
the President, Executive Vice President or Vice President and the Secretary or
Assistant Secretary upon a certificate may be facsimiles if the certificate is
countersigned by a transfer agent, or registered by a registrar, other than the
corporation itself or an employee of the corporation.

                  Section 6.04 SIGNATURE BY FORMER OFFICERS. In case any
officer, who has signed or whose facsimile signature has been placed upon any
certificate for shares, shall have ceased to be such officer before such
certificate is issued, it may be issued by the corporation with the same effect
as if he were such officer at the date of its issuance.

                  Section 6.05 TRANSFER OF SHARES. Prior to due presentment of a
certificate for shares for registration of transfer the corporation may treat
the registered owner of such shares as the person exclusively entitled to vote,
to receive notices and otherwise to exercise all the rights and powers of an
owner. Where a certificate for shares is presented to the corporation with a
request to register for transfer, the corporation shall not be liable to the
owner




or any other person suffering loss as a result of such registration of transfer
if (a) there were on or with the certificate the necessary endorsements, and (b)
the corporation had no duty to inquire into adverse claims or has discharged any
such duty. The corporation may require reasonable assurance that said
endorsements are genuine and effective and in compliance with such other
regulations as may be prescribed under the authority of the Board of Directors.

                  Section 6.06 LOST, DESTROYED OR STOLEN CERTIFICATES. Where the
owner claims that his or her certificate for shares has been lost, destroyed or
wrongfully taken, a new certificate shall be issued in place thereof if the
owner (a) so requests before the corporation has notice that such shares have
been acquired by a bona fide purchaser, and (b) files with the corporation a
sufficient indemnity bond, and (c) satisfies such other reasonable requirements
as the Board of Directors may prescribe.

                  Section 6.07 CONSIDERATION FOR SHARES. The shares of the
corporation may be issued for such consideration as shall be fixed from time to
time by the Board of Directors, provided that any shares having a par value
shall not be issued for a consideration less than the par value thereof. The
consideration to be paid for shares may consist of any tangible or intangible
property or benefit to the corporation, including cash, promissory notes, labor
or services actually performed or contracts for services yet to be performed or
other securities of the corporation. When the corporation receives the
consideration for which the Board of Directors authorized the issuance of
shares, the shares issued for that consideration are fully paid and
nonassessable.

                  Section 6.08 STOCK REGULATIONS. The Board of Directors shall
have the power and authority to make all such further rules and regulations not
inconsistent with the statutes of the State of Wisconsin as it may deem
expedient concerning the issue, transfer and registration of shares of the
corporation.

                                  ARTICLE VII.
                                      SEAL

                  The Board of Directors may provide a corporate seal which
shall be circular in form and, if so provided, such seal shall have inscribed
thereon the name of the corporation and the state of incorporation and the words
"Corporate Seal."

                                  ARTICLE VIII.
                                   AMENDMENTS

                  Section 8.01 BY SHAREHOLDERS. These By-laws may be altered,
amended or repealed and new by-laws may be adopted by the shareholders.

                  Section 8.02 BY DIRECTORS. These By-laws may also be altered,
amended or repealed and new by-laws may be adopted by the Board of Directors,
provided that no such amendment shall amend or alter any prior amendment adopted
by the shareholders pursuant to Section 8.01.




                  Section 8.03 IMPLIED AMENDMENTS. Any action taken or
authorized by the shareholders or by the Board of Directors, which would be
inconsistent with the By-laws then in effect but is taken or authorized by
affirmative vote of not less than the number of shares or the number of
Directors required to amend the By-laws so that the By-laws would be consistent
with such action, shall be given the same effect as though the By-laws had been
temporarily amended or suspended so far, but only so far, as is necessary to
permit the specific action so taken or authorized.

                                  ARTICLE IX.
                   DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS;
             LIABILITY AND INDEMNITY; TRANSACTIONS WITH CORPORATION

                  Section 9.01 LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND
AGENTS. The corporation may indemnify its incorporator, officers, directors,
employees and agents to the full extent permitted by law.

                  Section 9.02 TRANSACTIONS WITH THE CORPORATION. The Board of
Directors may from time to time authorize transactions by officers, directors
and employees with the corporation. Notwithstanding the foregoing, a corporation
may not lend money to or guaranty the obligation of a director of the
corporation unless either (a) the particular loan or guaranty is approved by a
majority of the votes represented by the outstanding voting shares of all
classes, voting as a single group, except the votes of shares owned by or voted
under the control of the benefitted shareholder, or (b) the corporation's Board
of Directors determines that the loan or guaranty benefits the corporation and
either approves the specific loan or guaranty or a general plan authorizing
loans and guaranties. The foregoing limitations do not, however, apply to an
advance made to a director to defray expenses incurred by the Director in the
ordinary course of the corporation's business or to an advance to a director
that is permitted pursuant to a claim of right to indemnification.

                  Any contract or other transaction between the corporation and
one or more of its directors, or between the corporation and any firm of which
one or more of its directors are members or employees, or in which they are
interested, or between the corporation and any corporation or association of
which one or more of its directors are shareholders, members, directors,
officers, or employees, or in which they are interested, shall be valid for all
purposes, notwithstanding the presence of such director or directors at the
meeting of the Board of Directors of the corporation which acts upon, or in
reference to such contract or transaction, and notwithstanding his or her or
their participation in such action, if the fact of such interest shall be
disclosed or known to the Board of Directors and the Board of Directors shall,
nevertheless, authorize, approve and ratify such Contract or transaction by a
vote of a majority of the directors present, such interested director or
directors to be counted in determining whether a quorum is present, but not to
be counted in calculating the majority of such quorum necessary to carry such
vote or as voting upon the matter. This Section shall not be construed to
invalidate any contract or other transaction which would otherwise be valid
under the common and statutory law applicable thereto.




                                   ARTICLE X.
                                EMERGENCY BYLAWS

                  Unless the Articles of Incorporation provide otherwise, the
provisions of this By-law shall be effective during an emergency which, for the
purposes hereof, is defined as the occurrence of a catastrophic event which
prevents a quorum of the corporation's directors from being readily assembled.
During such an emergency, any one member of the Board of Directors or any of the
officers, may call a meeting of the Board of Directors. Notice of such meeting
need be given only to those directors whom it is practicable to reach, and may
be given in any practical manner, including by publication and radio. Such
notice shall be given at least six hours prior to commencement of the meeting.
One or more officers of the corporation present at the emergency Board meeting,
as is necessary to achieve a quorum, shall be considered to be directors for the
meeting, and shall so serve in order of rank, and within the same rank, in order
of seniority. In the event that less than a quorum of the directors are present
(including any officers who are to serve as directors for the meeting), those
directors present (including the officers serving as directors) shall constitute
a quorum. The Board as constituted above, and after notice as set forth above
may: (a) prescribe emergency powers to any officer of the corporation; (b)
delegate to any officer or director, the powers of the Board of Directors; (c)
designate lines of succession of officers and agents, in the event that any of
them are unable to discharge their duties; (d) relocate the principal place of
business, or designate successive or simultaneous principal places of business;
and (e) take any other action, convenient, helpful, or necessary to carry on the
business of the corporation.

EX-3.103

                                                                   EXHIBIT 3.103

                          ARTICLES OF ORGANIZATION FOR
                        FLORIDA LIMITED LIABILITY COMPANY


                                   ARTICLE I
                                      NAME

                  The name of the Limited Liability Company is: Treasure Isle
Care Center, LLC.

                                   ARTICLE II
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee,
Wisconsin 53203.

                                  ARTICLE III
                                    DURATION

                  The period of duration for the Limited Liability Company shall
be: Unlimited/Perpetual.

                                   ARTICLE IV
                                   MANAGEMENT

                  The Limited Liability Company is to be managed by the members
and the name and address of the managing member is: Extendicare Health
Facilities, Inc., 111 West Michigan Street, Milwaukee, Wisconsin 53203.

                                   ARTICLE V
                         ADMISSION OF ADDITIONAL MEMBERS

                  The right, if given, of the members to admit additional
members and the terms and conditions of the admissions shall be: N/A.

                                   ARTICLE VI
                       MEMBERS RIGHTS TO CONTINUE BUSINESS

                  The right, if given, of the remaining members of the limited
liability company to continue the business on the death, retirement,
resignation, expulsion, bankruptcy, or dissolution of a member or the occurrence
of any other event which terminates the continued membership of a member in the
limited liability company shall be: None.

EX-3.104

                                                                   EXHIBIT 3.104






                            ARTICLES OF INCORPORATION
                                       OF
                       UNITED PROFESSIONAL SERVICES, INC.

                  Executed by the undersigned for the purpose of forming a
Wisconsin corporation under the "Wisconsin Business Corporation Law", Chapter
180 of the Wisconsin Statutes:

                                   ARTICLE I

                  The name of the corporation is United Professional Services,
Inc.

                                   ARTICLE II

                  The period of existence shall be perpetual.

                                  ARTICLE III

                  The purposes shall be to engage in any lawful activity for
which corporations may be organized under the Wisconsin Business Corporation
Law, subject to express limitations, if any.

                                   ARTICLE IV

                  The number of shares which it shall have authority to issue,
itemized by classes, par value of shares, shares without par value, and series,
if any, within a class, is:




                                           NUMBER OF SHARES       PAR VALUE PER SHARE OR STATEMENT THAT SHARES ARE
      CLASS          SERIES (IF ANY)                                              WITHOUT PAR VALUE
                                                         
     Common                 --                   2,500                      shares are without par value



                                   ARTICLE V

                  The preferences, limitations, designation, and relative rights
of each class or series of stock, are none.

                                   ARTICLE VI

                  The address of the initial registered office is 105 West
Michigan Street, Milwaukee, Wisconsin 53203.

                                  ARTICLE VII

                  The name of initial registered agent at such address is James
B. Young, Esq., 105 West Michigan Street, Milwaukee, Wisconsin 53203.




                                  ARTICLE VIII

                  The number of directors constituting the board of directors
shall be fixed by by-law.

                                   ARTICLE IX

                  Other provisions: None.

                                   ARTICLE X

                  The name and address of the incorporator is: Tom D.
Mellencamp, 105 West Michigan Street, Milwaukee, Wisconsin 53203.


                                       2

EX-3.105

                                                                   EXHIBIT 3.105


                                     BYLAWS
                                       OF
                       UNITED PROFESSIONAL SERVICES, INC.


                                    ARTICLE I
                                     OFFICES

                  Section 1. REGISTERED OFFICE. The registered office shall be
established and maintained at the office of United States Corporation Company,
in the City of Madison, in the State of Wisconsin and said corporation shall be
the registered agent of this corporation in charge thereof.

                  Section 2. OTHER OFFICES. The corporation may have other
offices, either within or without the State of Wisconsin, at such place or
places as the Board of Directors may from time to time appoint or the business
of the corporation may require.

                                   ARTICLE II
                            MEETINGS OF STOCKHOLDERS

                  Section 1. ANNUAL MEETINGS. Annual meetings of stockholders
for the election of directors and for such other business as may properly come
before the meeting shall be held at such place, either within or without the
State of Wisconsin, as the Board of Directors shall determine and as set forth
in the notice of the meeting.

                  Annual meetings of stockholders shall be held during the
fourth week of March in each year at a time and date to be determined by the
Board of Directors. At each annual meeting, the stockholders shall elect a Board
of Directors and they may transact such other business as may properly come
before the meeting.

                  Section 2. OTHER MEETINGS. Meetings of stockholders for any
purpose or purposes may be called by the President, the Secretary, the Board of
Directors or such other persons as may be authorized by law, and shall be held
at such time and place, within or without the State of Wisconsin, as shall be
stated in the notice of meeting.

                  Section 3. VOTING. Each stockholder entitled to vote in
accordance with the terms of the Articles of Incorporation and in accordance
with the provisions of these By-Laws shall be entitled to one vote, in person or
by proxy, executed in writing by the stockholder or by its duly authorized
attorney in fact, for each share of stock entitled to vote held by such
stockholder. All elections for directors shall be decided by plurality vote; all
other questions shall be decided by majority vote except as otherwise provided
by the Articles of Incorporation or the laws of the State of Wisconsin.

                  Section 4. QUORUM. Except as otherwise required by Law, by the
Articles of Incorporation or by these By-Laws, the presence, in person or by
proxy, of stockholders holding a majority of the stock of the corporation
entitled to vote shall constitute a quorum at all meetings of the stockholders.
In case a quorum shall not be present at any meeting, a majority in interest of
the stockholders entitled to vote thereat, present in person or by proxy, shall
have




power to adjourn the meeting from time to time, without notice other than
announcement at the meeting until the requisite amount of stock entitled to vote
shall be present; provided, that if the adjournment is for more than thirty days
or if after the adjournment a new record date is fixed for the adjourned
meeting, a notice of the adjourned meeting will be sent to each stockholder of
record entitled to vote at the meeting, as adjourned. At any such adjourned
meeting at which the requisite amount of stock entitled to vote shall be
represented, any business may be transacted which might have been transacted at
the meeting as originally noticed; but only those stockholders entitled to vote
at the meeting as originally noticed shall be entitled to vote at any
adjournment or adjournments thereof, unless a new record date therefor shall
have been fixed.

                  Section 5. NOTICE OF MEETINGS. Written notice, stating the
place, date and time of the meeting, and, in the case of a special meeting, the
purpose or purposes for which such meeting has been called, shall be given to
each stockholder entitled to vote thereat at his address as it appears on the
records of the corporation, not less than ten nor more than fifty days before
the date of the meeting.

                  Section 6. ACTION WITHOUT MEETING. Any action required to be
taken at any annual or special meeting of stockholders, or any action which may
be taken at any annual or special meeting, may be taken without a meeting,
without prior notice and without a vote, if a consent in writing, setting forth
the action so taken, shall be signed by the holders of all of the outstanding
stock of the corporation.

                                   ARTICLE III
                                    DIRECTORS

                  Section 1. NUMBER AND TERM. The number of authorized Directors
of the Corporation shall be not less than 1 nor more than 15, fixed from time to
time by the Shareholders. The Directors shall be elected at the annual meeting
of the Shareholders and each Director shall be elected to serve until his
successor shall be elected and shall qualify.

                  Section 2. RESIGNATIONS. Any director, member of a committee
or other officer may resign at any time. Such resignation shall be made in
writing, and shall take effect at the time specified therein, and if no time be
specified, at the time of its receipt by the President or Secretary. The
acceptance of a resignation shall not be necessary to make it effective.

                  Section 3. POWERS. The Board of Directors shall exercise all
of the powers of the corporation except such as are by law, or by the Articles
of Incorporation of the corporation or by these By-Laws conferred upon or
reserved to the stockholders.

                  Section 4. MEETINGS. The newly elected directors may hold
their first meeting for the purpose of the transaction of business, if a quorum
be present, immediately after the annual meeting of the stockholders; or the
time and place of such meeting may be fixed by consent in writing of all the
directors.

                  Regular meetings of the directors may be held without notice
at such places and times as shall be determined from time to time by resolution
of the directors.







                  Special meetings of the board may be called by or at the
request of the President, the Secretary or any two directors. Such meeting shall
be held at such place or places as shall be stated in the call of the meeting.
Notice of any special meeting shall be given at least six (6) hours previously
thereto in any one of the following methods: by oral or telephonic notice, by
written notice delivered personally or mailed to each director at his business
address, or by telegram; provided, that if notice is given by mail only, it
shall be given at least forty-eight (48) hours prior to such meeting. If mailed,
such notice shall be deemed to be delivered when deposited in the United States
mail so addressed, with postage thereon prepaid. If notice is given by telegram,
such notice shall be deemed delivered when the telegram is delivered to the
telegraph company. Whenever any notice whatever is required to be given to any
director of the corporation under the Certificate of Incorporation or these
By-Laws or any provision of law, a waiver thereof in writing, signed at any
time, whether before or after the time of the meeting, by the director entitled
to such notice, shall be deemed equivalent to the giving of such notice.

                  Members of the Board of Directors, or any committee designated
by the Board of Directors, may participate in a meeting of the Board of
Directors, or any committee, by means of conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other, and such participation in a meeting shall
constitute presence in person at the meeting.

                  Section 5. COMMITTEES. The Board of Directors may, by
resolution or resolutions passed by a majority of the whole board, designate one
or more committees, each committee to consist of three or more directors of the
corporation. The board may designate one or more directors as alternate members
of any committee, who may replace any absent or disqualified member at any
meeting of the committee. In the absence or disqualification of any member of
such committee or committees, the member or members thereof present at any
meeting and not disqualified from voting, whether or not he or they constitute a
quorum, may unanimously appoint another member of the Board of Directors to act
at the meeting in the place of any such absent or disqualified member.

                  Any such committee, to the extent provided in the resolution
of the Board of Directors, or in these By-Laws, shall have and may exercise all
the powers and authority of the Board of Directors in the management of the
business and affairs of the corporation, and may authorize the seal of the
corporation to be affixed to all papers which may require it; but no such
committee shall have the power or authority in reference to amending the
Articles of Incorporation, adopting an agreement of merger or consolidation,
recommending to the stockholders the sale, lease or exchange of all or
substantially all of the corporation's property and assets, recommending to the
stockholders a dissolution of the corporation or a revocation of a dissolution,
or amending the By-Laws of the corporation and, unless the resolution, these
By-Laws, or the Certificate of Incorporation expressly so provide, no such
committee shall have the power or authority to declare a dividend or to
authorize the issuance of stock.

                  Section 6. QUORUM. A majority of the directors shall
constitute a quorum for the transaction of business. If at any meeting of the
board there shall be less than a quorum present, a majority of those present may
adjourn the meeting from time to time until a quorum is obtained, and no further
notice thereof need be given other than by announcement at the meeting which
shall be so adjourned.







                                   ARTICLE IV
                                    OFFICERS

                  Section 1. OFFICERS. The officers of the corporation shall be
a President, a Treasurer, and a Secretary, all of whom shall be elected by the
Board of Directors and who shall hold office until their successors are elected
and qualified or until their earlier termination, death, resignation or removal.
In addition, the Board of Directors may elect a Chairman, one or more
Vice-Presidents and such Assistant Secretaries and Assistant Treasurers as they
may deem proper. None of the officers of the corporation need be directors. The
officers shall be elected at the first meeting of the Board of Directors after
each annual meeting. More than two offices may be held by the same person,
except for the offices of President and Vice-President and the offices of
President and Secretary.

                  Section 2. OTHER OFFICERS AND AGENTS. The Board of Directors
may appoint such other officers and agents as it may deem advisable, who shall
hold their offices for such terms and shall exercise such powers and perform
such duties as shall be determined from time to time by the Board of Directors.

                  Section 3. CHAIRMAN. The Chairman of the Board of Directors,
if one be elected, shall preside at air meetings of the Board of Directors and
he shall have and perform such other duties as from time to time may be assigned
to him by the Board of Directors.

                  Section 4. PRESIDENT. The President shall have the general
powers and duties of supervision and management usually vested in the office of
President of a corporation. He shall preside at all meetings of the stockholders
if present thereat, and in the absence or non-election of the Chairman of the
Board of Directors, at all meetings of the Board of Directors, and shall have
general supervision, direction and control of the business of the corporation.
Except as the Board of Directors shall authorize the execution thereof in some
other manner, he shall execute bonds, mortgages and other contracts in behalf of
the corporation, and shall cause the seal to be affixed to any instrument
requiring it and when so affixed the seal shall be attested by the signature of
the Secretary or the Treasurer or an Assistant Secretary or an Assistant
Treasurer.

                  Section 5. VICE-PRESIDENT. Each Vice-President shall have such
powers and shall perform such duties as shall be assigned to him by the Board of
Directors, or if no such powers and duties shall be assigned by the Board of
Directors, then such powers and duties as shall be assigned to him by the
Chairman of the Board of Directors or the President.

                  Section 6. TREASURER. The Treasurer shall have the custody of
the corporate funds and securities and shall keep full and accurate account of
receipts and disbursements in books belonging to the corporation. He shall
deposit all moneys and other valuables in the name and to the credit of the
corporation in such depositaries as may be designated by the Board of Directors.

The Treasurer shall disburse the funds of the corporation as may be ordered by
the Board of Directors, or the President, taking proper vouchers for such
disbursements. He shall render to the President and Board of Directors at the
regular meetings of the Board of Directors,





or whenever they may request it, an account of all his transactions as Treasurer
and of the financial condition of the corporation. If required by the Board of
Directors, he shall give the corporation a bond for the faithful discharge of
his duties in such amount and with such surety as the Board of Directors shall
prescribe.

                  Section 7. SECRETARY. The Secretary shall give, or cause to be
given, notice of all meetings of stockholders and directors, and all other
notices required by law or by these By-Laws, and in case of his absence or
refusal or neglect so to do, any such notice may be given by any person
thereunto directed by the President, or by the Board of Directors, or
stockholders, upon whose requisition the meeting is called as provided in these
By-Laws. He shall record all the proceedings of the meetings of the corporation
and of the directors in a book to be kept for that purpose, and shall perform
such other duties as may be assigned to him by the directors or the President.
He shall have the custody of the seal of the corporation and shall affix the
same to all instruments requiring it, when authorized by the Board of Directors
or the President, and attest the same.

                  Section 8. ASSISTANT TREASURERS AND ASSISTANT SECRETARIES.
Assistant Treasurers and Assistant Secretaries, if any, shall be elected and
shall have such powers and shall perform such duties as shall be assigned to
them, respectively, by the directors.

                                    ARTICLE V
                                  MISCELLANEOUS

                  Section 1. CERTIFICATES OF STOCK. Certificates of stock,
signed by the President or Vice-President and Secretary or any Assistant
Secretary, shall be issued to each stockholder certifying the number of shares
owned by such stockholder in the corporation. Any or all of the signatures may
be facsimiles.

                  Section 2. TRANSFER OF SHARES. The shares of stock of the
corporation shall be transferable only upon its books by the holders thereof in
person or by their duly authorized attorneys or legal representatives, and upon
such transfer the old certificates shall be surrendered to the corporation by
the delivery thereof to the person in charge of the stock and transfer books and
ledgers, or to such other person as the directors may designate, by whom they
shall be cancelled, and new certificates shall thereupon be issued. A record
shall be made of each transfer and whenever a transfer shall be made for
collateral security, and not absolutely, it shall be so expressed in the entry
of the transfer.

                  Section 3. STOCKHOLDERS RECORD DATE. In order that the
corporation may determine the stockholders entitled to notice of or to vote at
any meeting of stockholders or any adjournment thereof, or to express consent to
corporate action in writing without a meeting, or entitled to receive payment of
any dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any change, conversion or exchange of stock or
for the purpose of any other lawful action, the Board of Directors may fix, in
advance, a record date, which shall not be more than fifty nor less than ten
days before the date of such meeting, nor more than fifty days prior to any
other action. A determination of stockholders of record entitled to notice of or
to vote at a meeting of stockholders shall apply to





any adjournment of the meeting; provided, however, that the Board of Directors
may fix a new record date for the adjourned meeting.

                  Section 4. SEAL. The corporate seal shall be circular in form
and shall contain the name of the corporation, its state of incorporation and
the words "CORPORATE SEAL." Said seal may be used by causing it or a facsimile
thereof to be impressed or affixed or reproduced or otherwise.

                  Section 5. FISCAL YEAR. The fiscal year of the corporation,
beginning with the year 1983, shall be the calendar year.

                  Section 6. CHECKS. All checks, drafts or other orders for the
payment of money, notes or other evidences of indebtedness issued in the name of
the corporation shall be signed by such officer or officers, agent or agents of
the corporation, and in such manner as shall be determined from time to time by
resolution of the board of directors.

                  Section 7. INDEMNIFICATION. The corporation may indemnify its
officers, directors, employees and agents to the full extent permitted by law.

                  Section 8. NOTICE AND WAIVER OF NOTICE. Whenever, under the
provisions of law, the Articles of Incorporation or these By-Laws, notice is
required to be given to any person, it shall not be construed to mean personal
notice, but such notice may be given in writing, by mail, addressed to such
person at his address as it appears on the records of the corporation, with
postage thereon prepaid, and such notice shall be deemed to be given at the time
when the same shall be deposited in the United States mail. Notice to directors
may also be given by any of the methods specified in Article III, Section 8 of
these By-Laws.

                  Whenever any notice whatever is required to be given under the
provisions of any law, the Articles of Incorporation or these By-Laws, a waiver
thereof in writing, signed by the person or persons entitled to said notice,
whether before or after the time stated therein, shall be deemed equivalent
thereto. Any waiver of notice to stockholders shall set forth in reasonable
detail the purpose or purposes for which the meeting is called and the time and
place thereof. Attendance by a director or stockholder at any meeting of
directors or stockholders, respectively, shall constitute a waiver of notice of
such meeting, except where such director or stockholder attends a meeting for
the express purpose of objecting, at the beginning of such meeting, to the
transaction of business because the meeting is not lawfully called or convened.

                                   ARTICLE VI
                                   AMENDMENTS

                  These By-Laws may be altered or repealed and By-Laws may be
made at any annual meeting of the stockholders or at any special meeting thereof
if notice of the proposed alteration or repeal or By-Law or By-Laws to be made
be contained in the notice of such special meeting, by the affirmative vote of a
majority of the stock issued and outstanding and entitled to vote thereat, or by
the affirmative vote of a majority of the Board of Directors, at any regular or
special meeting of the Board of Directors.

EX-3.106

                                                                   EXHIBIT 3.106



                            ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


                  The undersigned, desiring to form a limited liability Company,
under Chapter 1705 of the Ohio Revised Code, do hereby state the following:

                  FIRST: The name of said limited liability company shall be:
Waterville Care, LLC.

                  SECOND: This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD: The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.107

                                                                EXHIBIT 3.107



                          ARTICLES OF ORGANIZATION FOR
                       FLORIDA LIMITED LIABILITY COMPANY


                                    ARTICLE I
                                      NAME

                  The name of the Limited Liability Company is: Winter Haven
Care, LLC.

                                   ARTICLE II
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee,
Wisconsin 53203.

                                   ARTICLE III
                                    DURATION

                  The period of duration for the Limited Liability Company shall
be: Unlimited/Perpetual.

                                   ARTICLE IV
                                   MANAGEMENT

                  The Limited Liability Company is to be managed by the members
and the name and address of the managing member is: Northern Health Facilities,
Inc., 111 West Michigan Street, Milwaukee, Wisconsin 53203.

                                    ARTICLE V
                         ADMISSION OF ADDITIONAL MEMBERS

                  The right, if given, of the members to admit additional
members and the terms and conditions of the admissions shall be: N/A.

                                   ARTICLE VI
                       MEMBERS RIGHTS TO CONTINUE BUSINESS

                  The right, if given, of the remaining members of the limited
liability company to continue the business on the death, retirement,
resignation, expulsion, bankruptcy, or dissolution of a member or the occurrence
of any other event which terminates the continued membership of a member in the
limited liability company shall be: None.

                                   ARTICLE VII
                    AFFIDAVIT OF MEMBERSHIP AND CONTRIBUTIONS

                  The undersigned member or authorized representative of a
member of Winter Haven Care, LLC certifies:









                  1. the above named limited liability company has at least one
                     member;

                  2. the total amount of cash contributed by the member(s) is
                     $1,000;

                  3. if any, the agreed value of property other than cash
                     contributed by member(s) is $0.00 (A description of the
                     property is attached and made a part hereto.); and

                  4. the total amount of cash and property contributed and
                     anticipated to be contributed by member(s) is $1,000.



                                       2

EX-3.108

                                                                EXHIBIT 3.108



                          ARTICLES OF ORGANIZATION FOR
                       FLORIDA LIMITED LIABILITY COMPANY


                                    ARTICLE I
                                      NAME

                  The name of the Limited Liability Company is: Winter Haven
Health and Rehabilitation Center, LLC.

                                   ARTICLE II
                                     ADDRESS

                  The mailing address and street address of the principal office
of the Limited Liability Company is: 111 West Michigan Street, Milwaukee,
Wisconsin 53203.

                                   ARTICLE III
                                    DURATION

                  The period of duration for the Limited Liability Company shall
be: Unlimited/Perpetual.

                                   ARTICLE IV
                                   MANAGEMENT

                  The Limited Liability Company is to be managed by the members
and the name and address of the managing member is: Extendicare Health
Facilities, Inc., 111 West Michigan Street, Milwaukee, Wisconsin 53203.

                                    ARTICLE V
                         ADMISSION OF ADDITIONAL MEMBERS

                  The right, if given, of the members to admit additional
members and the terms and conditions of the admissions shall be: N/A.

                                   ARTICLE VI
                       MEMBERS RIGHTS TO CONTINUE BUSINESS

                  The right, if given, of the remaining members of the limited
liability company to continue the business on the death, retirement,
resignation, expulsion, bankruptcy, or dissolution of a member or the occurrence
of any other event which terminates the continued membership of a member in the
limited liability company shall be: None.

EX-3.109

                                                                EXHIBIT 3.109



                            ARTICLES OF ORGANIZATION

                (Under Section 1705.04 of the Ohio Revised Code)
                            Limited Liability Company


                  The undersigned, desiring to form a limited liability Company,
under Chapter 1705 of the Ohio Revised Code, do hereby state the following:

                  FIRST: The name of said limited liability company shall be:
Woodsfield Care, LLC.

                  SECOND: This limited liability company shall exist for a
period of Unlimited/Perpetual.

                  THIRD: The address to which interested persons may direct
requests for copies of any operating agreement and any bylaws of this limited
liability company is: 111 West Michigan Street, Milwaukee, Wisconsin 53203.

EX-3.110

                                     BY-LAWS
                                       OF
                          COVENTRY CARE HOLDINGS, INC.

                                    ARTICLE I
                                     OFFICES

         Section 1. Registered Office. The address of the registered office in
the State of Delaware is 30 Old Rudnick Lane, in the City of Dover, County of
Kent. The name of its registered agent at such address is LexisNexis Document
Solutions, Inc.

         Section 2. Other Offices. The corporation may have other offices,
either within or without the State of Delaware, at such place or places as the
Board of Directors may from time to time appoint or the business of the
corporation may require.

                                   ARTICLE II
                            MEETINGS OF STOCKHOLDERS

         Section 1. Annual Meetings. Annual meetings of stockholders for the
election of directors and for such other business as may properly come before
the meeting shall be held at such place, either within or without the State of
Delaware, as the Board of Directors shall determine and as set forth in the
notice of the meeting.

         Annual meetings of stockholders shall be held during the fourth week of
March in each year at a time and date to be determined by the Board of
Directors. At each annual meeting, the stockholders shall elect a Board of
Directors and they may transact such other business as may properly come before
the meeting.

         Section 2. Other Meetings. Meetings of stockholders for any purpose or
purposes may be called by the President, the Secretary, the Board of Directors
or such other persons as may be authorized by law, and shall be held at such
time and place, within or without the State of Delaware, as shall be stated in
the notice of meeting.

         Section 3. Voting. Each stockholder entitled to vote in accordance with
the terms of the Articles of Incorporation and in accordance with the provisions
of these By-Laws shall be entitled to one vote, in person or by proxy, executed
in writing by the stockholder or by its duly authorized attorney in fact, for
each share of stock entitled to vote held by such stockholder. All elections for
directors shall be decided by plurality vote; all other questions shall be
decided by majority vote except as otherwise provided by the Articles of
Incorporation or the laws of the State of Delaware.

         Section 4. Quorum. Except as otherwise required by Law, by the Articles
of Incorporation or by these By-Laws, the presence, in person or by proxy, of
stockholders holding a majority of the stock of the corporation entitled to vote
shall constitute a quorum at all meetings of the stockholders. In case a quorum
shall not be present at any meeting, a majority in interest of the stockholders
entitled to vote thereat, present in person or by proxy, shall have power to
adjourn the meeting from time to time, without notice other than announcement at
the meeting until the requisite amount of stock entitled to vote shall be
present; provided, that if the




adjournment is for more than thirty days or if after the adjournment a new
record date is fixed for the adjourned meeting, a notice of the adjourned
meeting will be sent to each stockholder of record entitled to vote at the
meeting, as adjourned. At any such adjourned meeting at which the requisite
amount of stock entitled to vote shall be represented, any business may be
transacted which might have been transacted at the meeting as originally
noticed, but only those stockholders entitled to vote at the meeting as
originally noticed shall be entitled to vote at any adjournment or adjournments
thereof, unless a new record date therefor shall have been fixed.

         Section 5. Notice of Meetings. Written notice, stating the place, date
and time of any special meeting, and the purpose or purposes for which such
meeting has been called, shall be given to each stockholder entitled to vote
thereat at this address as it appears on the records of the corporation, not
less than ten nor more than fifty days before the date of the meeting. Regular
meetings of the Board of Directors may be held without notice of the date, time,
place or purpose of the meeting.

         Section 6. Action without Meeting. Any action required to be taken at
any annual or special meeting of stockholders, or any action which may be taken
at any annual or special meeting, may be taken without a meeting, without prior
notice and without a vote, if a consent in writing, setting forth the action so
taken, shall be signed by the holders of all of the outstanding stock of the
corporation.

                                   ARTICLE III
                                    DIRECTORS

         Section 1. Number and Term. The number of authorized Directors of the
Corporation shall be not less than 1 nor more than 15, fixed from time to time
by the Shareholder. The Directors shall be elected at the annual meeting of the
Shareholders and each Director shall be elected to serve until his successor
shall be elected and shall qualify.

         Section 2. Resignations. Any director, member of a committee, or other
officers may resign at any time. Such resignation shall be made in writing, and
shall take effect at the time specified therein, and if no time be specified, at
the time of its receipt by the President or Secretary. The acceptance of a
resignation shall not be necessary to make it effective.

         Section 3. Powers. The Board of Directors shall exercise all of the
powers of the corporation except such as are by law, or by the Article of
Incorporation of the corporation or by these By-Laws conferred upon or reserved
to the stockholders.

         Section 4. Meetings. The newly elected directors may hold their first
meeting for the purpose of the transaction of business, if a quorum be present,
immediately after the annual meeting of the stockholders; or the time and place
of such meeting may be fixed by consent in writing of all the directors.

         Regular meetings of the directors may be held without notice at such
places and times as shall be determined from time to time by resolution of the
directors.

         Special meetings of the board may be called by or at the request of the
President, the Secretary or any two directors. Such meeting shall be held at
such place or places as shall be


                                       2



stated in the call of the meeting. Notice of any special meeting shall be given
at least six (6) hours previously thereto in any one of the following methods:
by oral or telephonic notice, by written notice delivered personally or mailed
to each director at his business address, or by telegram; provided, that if
notice is given by mail only, it shall be given at least forty-eight (48) hours
prior to such meeting. If mailed, such notice shall be deemed to be delivered
when deposited in the United States mail so addressed, with postage thereon
prepaid. If notice is given by telegram, such notice shall be deemed delivered
when the telegram is delivered to the telegraph company. Whenever any notice
whatever is required to be given to any director of the corporation under the
Certificate of Incorporation of these By-Laws or any provision of law, a waiver
thereof in writing, signed at any time, whether before or after the time of the
meeting, by the director entitled to such notice, shall be deemed equivalent to
the giving of such notice.

         Members of the Board of Directors, or any committee designated by the
Board of Directors, may participate in a meeting of the Board of Directors, or
any committee, by means of conference telephone or similar communications
equipment by means of which all persons participating in the meeting can hear
each other, and such participation in a meeting shall constitute presence in
person at the meeting.

         Section 5. Committees. The Board of Directors may, by resolution or
resolutions passed by a majority of the whole board, designate one or more
committees, each committee to consist of three or more directors of the
corporation. The board may designate one or more directors as alternate members
of any committee, who may replace any absent or disqualified member at any
meeting of the committee. In the absence or disqualification of any member of
such committee or committees, the member or members thereof present at any
meeting and not disqualified from voting, whether or not he or they constitute a
quorum, may unanimously appoint another member of the Board of Directors to act
at the meeting in the place of any such absent or disqualified member.

         Any such committee, to the extent provided in the resolution of the
Board of Directors, or in these By-Laws, shall have and may exercise all the
powers and authority of the Board of Directors in the management of the business
and affairs of the corporation; and may authorize the seal of the corporation to
be affixed to all papers which may require it; but no such committee shall have
the power or authority in reference to amending the Articles of Incorporation,
adopting an agreement of merger or consolidation, recommending to the
stockholders the sale, lease or exchange of all or substantially all of the
corporation's property and assets, recommending to the stockholders a
dissolution of the corporation or a revocation of a dissolution, or amending the
By-Laws of the corporation and, unless the resolution, these By-Laws, or the
Certificate of Incorporation expressly so provide, no such committee shall have
the power of authority to declare a dividend or to authorize the issuance of
stock.

         Section 6. Quorum. A majority of the directors shall constitute a
quorum for the transaction of business. If at any meeting of the board there
shall be less than a quorum present, a majority of those present may adjourn the
meeting from time to time until a quorum is obtained, and no further notice
thereof need be given other than by announcement at the meeting which shall be
so adjourned.


                                       3




                                   ARTICLE IV
                                    OFFICERS

         Section 1. Officers. The officers of the corporation shall be a
President, a Treasurer, and a Secretary, all of whom shall hold office until
their successors are elected and qualified or until their earlier termination,
death, resignation or removal. In addition, the Board of Directors may elect a
Chairman, Chief Executive Officer, one or more Vice-Presidents and such
Assistant Secretaries and Assistant Treasurers as they may deem proper. None of
the officers of the corporation need be directors. The officers shall be elected
at the first meeting of the Board of Directors after each annual meeting. More
than two offices may be held by the same person, except for the offices of
President and Vice-President and the offices of President and Secretary.

         Section 2. Other Officers and Agents. The Board of Directors may
appoint such other officers and agents as it may deem advisable, who shall hold
their offices for such terms and shall exercise such powers and perform such
duties as shall be determined from time to time by the Board of Directors.

         Section 3. Chairman. The Chairman of the Board of Directors, if one be
elected, shall preside at all meetings of the Board of Directors and he shall
have and perform such other duties as from time to time may be assigned to him
by the Board of Directors.

         Section 4. President. The President shall have the general powers and
duties of supervision and management usually vested in the office of President
of a corporation. He shall preside at all meetings of the stockholders if
present thereat, and in the absence or non-election of the Chairman of the Board
of Directors, at all meetings of the Board of Directors, and shall have general
supervision, direction and control of the business of the corporation. Except as
the Board of Directors shall authorize the execution thereof in some other
manner, he shall execute bonds, mortgages and other contracts in behalf of the
corporation, and shall cause the seal to be affixed to any instrument requiring
it and when so affixed the seal shall be attested by the signature of the
Secretary or the Treasurer or an Assistant Secretary or an Assistant Treasurer.

         Section 5. Vice-President. Each Vice-President shall have such powers
and shall perform such duties as shall be assigned to him by the Board of
Directors, or if no such powers and duties shall be assigned by the Board of
Directors, then such powers and duties as shall be assigned to him by the
Chairman of the Board of Directors or the President.

         Section 6. Treasurer. The Treasurer shall have the custody of the
corporate funds and securities and shall keep full and accurate account of
receipts and disbursements in books belonging to the corporation. He shall
deposit all moneys and other valuables in the name and to the credit of the
corporation in such depositaries as may be designated by the Board of Directors.

         The Treasurer shall disburse the funds of the corporation as may be
ordered by the Board of Directors, or the President, taking proper vouchers for
such disbursements. He shall render to the President and Board of Directors at
the regular meetings of the Board of Directors,

                                       4


or whenever they may request it, an account of all his transactions as Treasurer
and of the financial condition of the corporation. If required by the Board of
Directors, he shall give the corporation a bond for the faithful discharge of
his duties in such amount and with such surety as the Board of Directors shall
prescribe.

         Section 7. Secretary. The Secretary shall give, or cause to be given,
any required notice of meetings of stockholders and directors, and all other
notices required by law or by these By-Laws, and in case of his absence or
refusal or neglect so to do, any such notice may be given by any person
thereunto directed by the President, or by the Board of Directors, or
stockholders, upon whose requisition the meeting is called as provided in these
By-Laws. He shall record all the proceedings of the meetings of the corporation
and of the directors in a book to be kept for that purpose, and shall perform
such other duties as may be assigned to him by the directors or the President.
He shall have the custody of the seal of the corporation and shall affix the
same to all instruments requiring it, when authorized by the Board of Directors
or the President, and attest the same.

         Section 8. Assistant Treasurers and Assistant Secretaries. Assistant
Treasurers and Assistant Secretaries, if any, shall be elected and shall have
such powers and shall perform such duties as shall be assigned to them,
respectively, by the directors.

                                    ARTICLE V
                                  MISCELLANEOUS

         Section 1. Certificates of Stock. Certificates of stock, signed by the
President or Vice-President and Secretary or any Assistant Secretary, shall be
issued to each stockholder certifying the number of shares owned by such
stockholder in the corporation. Any or all of the signatures may be facsimiles.

         Section 2. Transfer of Shares. The shares of stock of the corporation
shall be transferable only upon its books by the holders thereof in person or by
their duly authorized attorneys or legal representatives, and upon such transfer
the old certificates shall be surrendered to the corporation by the delivery
thereof to the person in charge of the stock and transfer books and ledgers, or
to such other person as the directors may designate, by whom they shall be
canceled, and new certificates shall thereupon be issued. A record shall be made
of each transfer and whenever a transfer shall be made for collateral security,
and not absolutely, it shall be so expressed in the entry of the transfer.

         Section 3. Stockholders Record Date. In order that the corporation may
determine the stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof, or to express consent to corporate
action in writing without a meeting, or entitled to receive payment of any
dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect to any change, conversion or exchange of stock or
for the purpose of any other lawful action, the Board of Directors may fix, in
advance, a record date, which shall not be more than fifty nor less than ten
days before the date of such meeting nor more than fifty days prior to any other
action. A determination of stockholders of record entitled to notice of or to
vote at a meeting of stockholders shall apply to any adjournment of the

                                       5


meeting; provided, however, that the Board of Directors may fix a new record
date for the adjourned meeting.

         Section 4. Seal. The corporate seal shall be circular in form and shall
contain the name of the corporation, its state of incorporation and the words
"CORPORATE SEAL." Said seal may be used by causing it or a facsimile thereof to
be impressed or affixed or reproduced otherwise.

         Section 5. Fiscal Year. The fiscal year of the corporation shall be the
calendar year.

         Section 6. Checks. All checks, drafts or other orders for the payment
of money, notes or other evidences of indebtedness issued in the name of the
corporation shall be signed by such officer or officers, agent or agents of the
corporation, and in such manner as shall be determined from time to time by
resolution of the Board of Directors.

         Section 7. Indemnification. The corporation may indemnify its
incorporator, officers, directors, employees and agents to the full extent
permitted by law.

         Section 8. Notice and Waiver of Notice. Whenever, under the provisions
of law, the Articles of Incorporation or these By-Laws, notice is required to be
given to any person, it shall not be construed to mean personal notice, but such
notice may be given in writing, by mail, addressed to such person at his address
as it appears on the records of the corporation, with postage thereon prepaid,
and such notice shall be deemed to be given at the time when the same shall be
deposited in the United States mail. Notice to directors may also be given by
any of the methods specified in Article III, Section 4, of these By-Laws.

         Whenever any notice whatever is required to be given under the
provisions of any law, the Articles of Incorporation or these By-Laws, a waiver
thereof in writing, signed by the person or persons entitled to said notice,
whether before or after the time stated therein, shall be deemed equivalent
thereto. Any waiver of notice to stockholders shall set forth in reasonable
detail the purpose or purposes for which the meeting is called and the time and
place thereof. Attendance by a director or stockholder at any meeting of
directors or stockholders, respectively, shall constitute a waiver of notice of
such meeting, except where such director or stockholder attends a meeting for
the express purpose of objecting, at the beginning of such meeting, to the
transaction of business because the meeting is not lawfully called or convened.

                                   ARTICLE VI
                                   AMENDMENTS

         These By-Laws may be altered or repealed and By-Laws may be made at any
annual meeting of the stockholders or at any special meeting thereof if notice
of the proposed alteration or repeal or By-Law or By-Laws to be made be
contained in the notice of such special meeting, by the affirmative vote of a
majority of the stock issued and outstanding and entitled to vote thereat, or by
the affirmative vote of a majority of the Board of Directors, at any regular or
special meeting of the Board of Directors.


                                       6

EX-4.2

                                                                     EXHIBIT 4.2

                                                               EXECUTION VERSION

                        EXTENDICARE HEALTH SERVICES, INC.

                                  $150,000,000

                          9 1/2% SENIOR NOTES DUE 2010

                               PURCHASE AGREEMENT

                                                                   June 20, 2002

Lehman Brothers Inc.
U.S. Bancorp Piper Jaffray Inc.
ABN AMRO Incorporated

c/o Lehman Brothers Inc.
745 Seventh Avenue, 19th Floor
New York, New York 10019

Ladies and Gentlemen:

                  Extendicare Health Services, Inc., a Delaware corporation (the
"COMPANY"), proposes to issue and sell to the several Initial Purchasers named
in Schedule 1 hereto (the "INITIAL PURCHASERS") $150,000,000 aggregate principal
amount of its 9 1/2% Senior Notes due 2010 (the "NOTES") guaranteed (the
"GUARANTEES") by the Company's domestic subsidiaries signatory hereto
(collectively, the "SUBSIDIARY GUARANTORS") pursuant to the terms of an
indenture (the "INDENTURE"), to be dated June 28, 2002, between the Company, the
Subsidiary Guarantors and U.S. Bank, N.A., as trustee (the "TRUSTEE").

                  The Notes will be offered and sold to you pursuant to an
exemption from the registration requirements under the Securities Act of 1933,
as amended (the "SECURITIES ACT"). The Company has prepared a preliminary
offering memorandum, dated June 7, 2002 (as amended or supplemented, the
"PRELIMINARY OFFERING MEMORANDUM"), and will prepare a final offering memorandum
(as amended or supplemented, the "OFFERING MEMORANDUM"), to be dated June 20,
2002, relating to the Company, the Notes and the Guarantees.

                  Upon original issuance thereof, and until such time as the
same is no longer required under the applicable requirements of the Securities
Act, the Notes (and all securities issued in exchange therefor or in
substitution therefor) shall bear substantially the following legend:

         THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
         SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT
         BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED, IN THE ABSENCE OF
         SUCH REGISTRATION UNLESS THE TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT
         TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF
         THIS NOTE BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT (A) IT IS A
         "QUALIFIED


                                                                               1


         INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT)
         OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS NOTE IN AN
         "OFFSHORE TRANSACTION" PURSUANT TO RULE 904 OF REGULATION S UNDER THE
         SECURITIES ACT, (2) AGREES THAT IT WILL NOT PRIOR TO (A) THE DATE WHICH
         IS TWO YEARS (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE
         144(k) UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION THEREUNDER)
         AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR OF ANY
         PREDECESSOR OF THIS NOTE) OR THE LAST DAY ON WHICH THE COMPANY OR ANY
         AFFILIATE OF THE COMPANY WERE THE OWNERS OF THIS NOTE (OR ANY
         PREDECESSOR OF THIS NOTE) AND (B) SUCH LATER DATE, IF ANY, AS MAY BE
         REQUIRED BY APPLICABLE LAW (THE "RESALE RESTRICTION TERMINATION DATE"),
         OFFER, SELL OR OTHERWISE TRANSFER THIS NOTE EXCEPT (I) TO THE COMPANY,
         (II) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
         EFFECTIVE UNDER THE SECURITIES ACT, (III) FOR SO LONG AS THE NOTES ARE
         ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY
         BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A
         UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
         ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT
         THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (IV) PURSUANT TO
         OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED
         STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT OR
         (V) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
         REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE TO
         EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO
         THE EFFECT OF THIS LEGEND; PROVIDED THAT THE COMPANY, THE TRUSTEE, AND
         THE REGISTRAR SHALL HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR
         TRANSFER PURSUANT TO CLAUSE (IV) OR (V) TO REQUIRE THAT AN OPINION OF
         COUNSEL, CERTIFICATIONS AND/OR OTHER INFORMATION SATISFACTORY TO THE
         COMPANY, THE TRUSTEE AND THE REGISTRAR IS COMPLETED AND DELIVERED BY
         THE TRANSFEROR. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE
         HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE. AS USED HEREIN,
         THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON"
         HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES
         ACT.

                  You have advised the Company that you will make offers and
sales (the "EXEMPT RESALES") of the Notes purchased hereunder on the terms set
forth in the Offering Memorandum solely to (i) persons whom you reasonably
believe to be "qualified institutional buyers" as defined in Rule 144A under the
Securities Act ("QIBs") and (ii) outside the United States to


                                                                               2


persons other than U.S. persons in offshore transactions meeting the
requirements of Regulation S under the Securities Act ("REGULATION S") (such
persons specified in clauses (i) and (ii) being referred to herein as the
"ELIGIBLE PURCHASERS"). As used herein, the terms "offshore transaction,"
"United States" and "U.S. person" have the respective meanings given to them in
Regulation S. You will offer the Notes to Eligible Purchasers initially at a
price equal to 99.75% of the principal amount thereof. Thereafter, the offering
price may be changed at any time without notice.

                  In connection with the offering of the Notes, the Company and
the Subsidiary Guarantors will enter into a new revolving credit facility in the
amount of up to $105.0 million pursuant to a credit agreement among Extendicare
Holdings, Inc., the Company, the Subsidiary Guarantors, Lehman Commercial Paper
Inc., as the administrative agent and the other lenders thereto (the "NEW CREDIT
FACILITY"). The net proceeds from the sale of the Notes will be used (i) to
refinance all of the Company's and the Subsidiary Guarantors' outstanding
obligations under their existing credit facility (the "EXISTING CREDIT
FACILITY"), (ii) to refinance an existing industrial development revenue bond,
(iii) to refinance a promissory note and (iv) for general corporate purposes,
all as described in the "Use of Proceeds" section of the Offering Memorandum. In
addition, the Company and the Subsidiary Guarantors intend to enter into a
five-year interest rate swap agreement with respect to the Company's outstanding
9.35% Senior Subordinated Notes due 2007 (the "SWAP AGREEMENT"). The entering
into of the New Credit Facility and the Swap Agreement, the offering of the
Notes and the use of the net proceeds from the sale of the Notes as provided in
the "Use of Proceeds" section of the Offering Memorandum are collectively
referred to herein as the "TRANSACTIONS."

                  Holders (including subsequent transferees) of the Notes will
have the registration rights set forth in the registration rights agreement (the
"REGISTRATION RIGHTS AGREEMENT") among the Company, the Subsidiary Guarantors
and the Initial Purchasers, to be dated as of the Closing Date (as defined
below), in the form of Exhibit A hereto, for so long as such Notes constitute
"TRANSFER RESTRICTED SECURITIES" (as defined in the Registration Rights
Agreement). Pursuant to the Registration Rights Agreement, the Company and the
Subsidiary Guarantors will agree to file with the Securities and Exchange
Commission (the "COMMISSION") under the circumstances set forth therein, (i) a
registration statement under the Securities Act (the "EXCHANGE OFFER
REGISTRATION STATEMENT") relating to a separate series of the Company's 9 1/2%
Senior Notes due 2010 (the "EXCHANGE NOTES") to be offered in exchange for the
Notes (such offer to exchange being referred to collectively as the "REGISTERED
EXCHANGE OFFER") and (ii) if required by the terms of the Registration Rights
Agreement, a shelf registration statement pursuant to Rule 415 under the
Securities Act (the "SHELF REGISTRATION STATEMENT") relating to the resale by
certain holders of the Notes, and to use their best efforts to cause such
Registration Statements to be declared effective. This Agreement, the Notes, the
Exchange Notes, the Guarantees, the Exchange Note Guarantees (as defined below),
the Indenture and Registration Rights Agreement are hereinafter referred to
collectively as the "OPERATIVE DOCUMENTS." This is to confirm the agreements
concerning the purchase of the Notes from the Company by the Initial Purchasers.

                  SECTION 1. Representations, Warranties and Agreements of the
Company and the Subsidiary Guarantors. The Company and the Subsidiary
Guarantors, jointly and severally, represent, warrant and agree that:



                                                                               3



                  (a) The Preliminary Offering Memorandum and the Offering
         Memorandum have been or will be prepared by the Company and Subsidiary
         Guarantors for use by the Initial Purchasers in connection with the
         Exempt Resales. No order or decree preventing the use of the
         Preliminary Offering Memorandum or the Offering Memorandum, or any
         order asserting that the transactions contemplated by this Agreement
         are subject to the registration requirements of the Securities Act has
         been issued and no proceeding for that purpose has commenced or is
         pending or, to the knowledge of the Company and Subsidiary Guarantors,
         is contemplated.

                  (b) The Preliminary Offering Memorandum and the Offering
         Memorandum as of their respective dates did not, and the Offering
         Memorandum as of the Closing Date will not, contain an untrue statement
         of a material fact or omit to state a material fact necessary, in order
         to make the statements made therein, in the light of the circumstances
         under which they were made, not misleading, except that this
         representation and warranty does not apply to statements in or
         omissions from the Preliminary Offering Memorandum and the Offering
         Memorandum made in reliance upon and in conformity with information
         relating to the Initial Purchasers furnished to the Company in writing
         by or on behalf of the Initial Purchasers expressly for use therein, as
         specifically identified in Section 8(e) hereof.

                  (c) The Company and each of the Subsidiary Guarantors (i) have
         been duly organized or formed, are validly existing and are in good
         standing under the laws of their respective jurisdictions of
         organization, and (ii) are duly qualified to do business and are in
         good standing in each jurisdiction in which their respective ownership
         or lease of property or the conduct of their respective businesses
         requires such qualification, except where the failure to so qualify or
         to be in good standing would not have a material adverse effect on the
         general affairs, management, consolidated financial position,
         shareholders' equity, results of operations, business or prospects of
         the Company and its subsidiaries taken as a whole (a "MATERIAL ADVERSE
         EFFECT"). The Company and each of the Subsidiary Guarantors have all
         power and authority necessary to own or hold their respective
         properties and to conduct the businesses in which they are engaged, and
         none of the subsidiaries of the Company, other than Extendicare Homes,
         Inc., Northern Health Facilities, Inc. and Extendicare Health
         Facilities, Inc., is a "significant subsidiary," as such term is
         defined in Rule 405 under the Securities Act.

                  (d) The Subsidiary Guarantors constitute all of the active
         subsidiaries of the Company and each of the Company's other
         subsidiaries are individually and in the aggregate inactive and
         immaterial.

                  (e) The Company has an authorized capitalization as set forth
         in the Offering Memorandum. All of the issued shares of capital stock
         of the Company have been duly and validly authorized and issued and are
         fully paid and non-assessable; and all of the issued shares of capital
         stock and limited partner or limited liability company interests of
         each of the Subsidiary Guarantors have been duly and validly authorized
         and issued and are fully paid and non-assessable (except, in the case
         of such Subsidiary Guarantors that are Wisconsin corporations, for
         certain statutory liabilities that may be imposed by Section
         180.0622(2)(b) of the Wisconsin Business Corporation Law for unpaid
         employee



                                                                               4


         wages) and are owned directly or indirectly by the Company, free and
         clear of all liens, encumbrances, equities or claims, other than liens,
         encumbrances, equities or claims under the Existing Credit Facility
         (which will be assigned to the lenders under the New Credit Facility on
         the Closing Date) and contemplated under the New Credit Facility or
         otherwise described in the Offering Memorandum, and none of such shares
         of capital stock, or limited partner or limited liability company
         interests were issued in violation of preemptive or other similar
         rights arising by operation of law, under the charter and bylaws of the
         Company or under any agreement to which the Company or any Subsidiary
         Guarantor is a party or otherwise.

                  (f) Each of the Company and the Subsidiary Guarantors has all
         requisite power and authority to execute, deliver and perform its
         respective obligations under this Agreement and each of the other
         Operative Documents to which it is a party.

                  (g) This Agreement has been duly and validly authorized,
         executed and delivered by the Company and the Subsidiary Guarantors.

                  (h) The Registration Rights Agreement has been duly and
         validly authorized by the Company and each of the Subsidiary
         Guarantors, and when duly executed by the proper officers of the
         Company and each of the Subsidiary Guarantors (assuming due
         authorization, execution and delivery by the Initial Purchasers) and
         delivered by the Company and each of the Subsidiary Guarantors, will
         constitute a legal, valid and binding agreement of the Company and each
         of the Subsidiary Guarantors, enforceable against the Company and each
         of the Subsidiary Guarantors in accordance with its terms, subject to
         applicable bankruptcy, insolvency, fraudulent conveyance,
         reorganization, moratorium and other similar laws relating to or
         affecting creditors' rights and remedies generally, and subject, as to
         enforceability, to general principles of equity, including principles
         of commercial reasonableness, good faith and fair dealing (regardless
         of whether enforcement is sought in a proceeding at law or in equity),
         and except that rights to indemnification and contribution thereunder
         may be limited by federal or state securities laws or public policy
         relating thereto.

                  (i) The Indenture has been duly and validly authorized by the
         Company and each of the Subsidiary Guarantors, and when duly executed
         by the proper officers of the Company and each of the Subsidiary
         Guarantors (assuming due authorization, execution and delivery by the
         Trustee) and delivered by the Company and each of the Subsidiary
         Guarantors, will constitute a legal, valid and binding agreement of the
         Company and each of the Subsidiary Guarantors enforceable against the
         Company and each of the Subsidiary Guarantors in accordance with its
         terms, subject to applicable bankruptcy, insolvency, fraudulent
         conveyance, reorganization, moratorium and other similar laws relating
         to or affecting creditors' rights and remedies generally, and subject,
         as to enforceability, to general principles of equity, including
         principles of commercial reasonableness, good faith and fair dealing
         (regardless of whether enforcement is sought in a proceeding at law or
         in equity). No qualification of the Indenture under the Trust Indenture
         Act of 1939, as amended (the "TRUST INDENTURE ACT"), is required in
         connection with the offer and sale of the Notes contemplated hereby or
         in connection with the Exempt Resales. The Indenture


                                                                               5


         conforms to the requirements of the Trust Indenture Act and the rules
         and regulations thereunder applicable to an indenture that is qualified
         thereunder.

                  (j) The Notes have been duly and validly authorized by the
         Company and when duly issued by the Company in accordance with the
         terms of the Indenture and, assuming due authentication of the Notes by
         the Trustee, when delivered to the Initial Purchasers against payment
         therefor in accordance with the terms hereof, will have been validly
         issued and delivered, and will constitute legal, valid and binding
         obligations of the Company entitled to the benefits of the Indenture
         and enforceable against the Company in accordance with their terms,
         subject to applicable bankruptcy, insolvency, fraudulent conveyance,
         reorganization, moratorium and other similar laws relating to or
         affecting creditors' rights and remedies generally, and subject, as to
         enforceability, to general principles of equity, including principles
         of commercial reasonableness, good faith and fair dealing (regardless
         of whether enforcement is sought in a proceeding at law or in equity).

                  (k) The Guarantees have been duly and validly authorized by
         each of the Subsidiary Guarantors and when duly endorsed on the Notes
         in accordance with the terms of the Indenture and, assuming due
         authentication of the Notes by the Trustee, upon delivery to the
         Initial Purchasers against payment therefor in accordance with the
         terms hereof will constitute legal, valid and binding obligations of
         each of the Subsidiary Guarantors entitled to the benefits of the
         Indenture and enforceable against each of the Subsidiary Guarantors in
         accordance with their terms, subject to applicable bankruptcy,
         insolvency, fraudulent conveyance, reorganization, moratorium and other
         similar laws relating to or affecting creditors' rights and remedies
         generally, and subject, as to enforceability, to general principles of
         equity, including principles of commercial reasonableness, good faith
         and fair dealing (regardless of whether enforcement is sought in a
         proceeding at law or in equity).

                  (l) The Exchange Notes have been duly and validly authorized
         by the Company and if and when duly issued by the Company in accordance
         with the terms of the Indenture and, assuming due authentication of the
         Exchange Notes by the Trustee, if and when delivered in accordance with
         the Registered Exchange Offer contemplated by the Registration Rights
         Agreement, will constitute legal, valid and binding obligations of the
         Company entitled to the benefits of the Indenture and enforceable
         against the Company in accordance with their terms, subject to
         applicable bankruptcy, insolvency, fraudulent conveyance,
         reorganization, moratorium and other similar laws relating to or
         affecting creditors' rights and remedies generally, and subject, as to
         enforceability, to general principles of equity, including principles
         of commercial reasonableness, good faith and fair dealing (regardless
         of whether enforcement is sought in a proceeding at law or in equity).

                  (m) The guarantees of the Exchange Notes (the "EXCHANGE NOTE
         GUARANTEES") have been duly and validly authorized by each of the
         Subsidiary Guarantors and if and when duly endorsed on the Exchange
         Notes in accordance with the terms of the Indenture and, assuming due
         authentication of the Exchange Notes by the Trustee, if and when the
         Exchange Notes are delivered in accordance with the Registered

                                                                               6


         Exchange Offer contemplated by the Registration Rights Agreement, will
         constitute legal, valid and binding obligations of each of the
         Subsidiary Guarantors entitled to the benefits of the Indenture and
         enforceable against each of the Subsidiary Guarantors in accordance
         with their terms, subject to applicable bankruptcy, insolvency,
         fraudulent conveyance, reorganization, moratorium and other similar
         laws relating to or affecting creditors' rights and remedies generally,
         and subject, as to enforceability, to general principles of equity,
         including principles of commercial reasonableness, good faith and fair
         dealing (regardless of whether enforcement is sought in a proceeding at
         law or in equity).

                  (n) The Company and the Subsidiary Guarantors have all
         requisite corporate power and authority to enter into (A) the New
         Credit Facility, (B) any and all other agreements and instruments
         ancillary to or entered into in connection with the transaction
         contemplated by the New Credit Facility (items (A) and (B) are referred
         to collectively as the "CREDIT DOCUMENTS") and (C) the Swap Agreement.

                  (o) Each of the New Credit Facility, the other Credit
         Documents and the Swap Agreement have been duly and validly authorized
         by the Company and the Subsidiary Guarantors, to the extent they are a
         party thereto, and when duly executed by the proper officers of the
         Company and each of the Subsidiary Guarantors (assuming due
         authorization, execution and delivery by the other parties thereto) and
         delivered by the Company and each of the Subsidiary Guarantors, to the
         extent they are a party thereto, will constitute a legal, valid and
         binding agreement of each of the Company and the Subsidiary Guarantors,
         enforceable against the Company and each of the Subsidiary Guarantors
         in accordance with its terms, subject to applicable bankruptcy,
         insolvency, fraudulent conveyance, reorganization, moratorium and other
         similar laws relating to or affecting creditors' rights and remedies
         generally, and subject, as to enforceability, to general principles of
         equity, including principles of commercial reasonableness, good faith
         and fair dealing (regardless of whether enforcement is sought in a
         proceeding at law or in equity). Prior to the issuance of letters of
         credit to replace existing letters of credit, the Company will have up
         to $105.0 million of borrowings available to it under the New Credit
         Facility after the Closing of the sale of the Notes, the receipt by the
         Company of the proceeds therefrom and the application of such proceeds
         as described under the caption "Use of Proceeds" in the Offering
         Memorandum. All representations and warranties made by the Company in
         the New Credit Facility and the other Credit Documents will be true and
         correct in all material respects as of the date thereof.

                  (p) The Indenture, the Notes, the Guarantees, the Registration
         Rights Agreement and the Credit Documents conform in all material
         respects to the descriptions thereof in the Offering Memorandum.

                  (q) The execution, delivery and performance of this Agreement,
         the other Operative Documents, the New Credit Facility and the other
         Credit Documents and the Swap Agreement by the Company and the
         Subsidiary Guarantors and the consummation of the Transactions will not
         conflict with or result in a breach or violation of any of the terms or
         provisions of, or constitute a default under, (i) any indenture,
         mortgage, deed of trust, loan agreement or other agreement, license or
         instrument to which the Company or


                                                                               7


         any of the Subsidiary Guarantors is a party or by which the Company or
         any of the Subsidiary Guarantors is bound or to which any of the
         property or assets of the Company or any of the Subsidiary Guarantors
         is subject, (ii) the provisions of the charter or bylaws of the Company
         or the charter, bylaws or other organizational documents of any of the
         Subsidiary Guarantors or (iii) any statute or any order, rule or
         regulation of any court or governmental agency or body having
         jurisdiction over the Company or any of the Subsidiary Guarantors or
         any of their properties or assets, except, in the case of clauses (i)
         and (iii) for such conflicts, breaches, violations or defaults that
         would not have a Material Adverse Effect. Except as may be required in
         connection with (1) the registration of the Notes, the Exchange Notes,
         the Guarantees and/or the Exchange Note Guarantees under the Securities
         Act in accordance with the Registration Rights Agreement, (2)
         qualification of the Indenture under the Trust Indenture Act, (3)
         compliance with the securities or Blue Sky laws of various
         jurisdictions and (4) filings required by the terms of the Credit
         Documents, no consent, approval, authorization or order of, or filing
         or registration with, any such court or governmental agency or body is
         required for the execution, delivery and performance of this Agreement,
         any of the other Operative Documents, the New Credit Facility and the
         other Credit Documents or the Swap Agreement by the Company and the
         Subsidiary Guarantors and the consummation of the Transactions.

                  (r) The financial statements (including the related notes and
         supporting schedules) included in the Offering Memorandum comply as to
         form in all material respects with the requirements of Regulation S-X
         under the Securities Act and present fairly the financial condition and
         results of operations and cash flows of the entities purported to be
         shown thereby, at the dates and for the periods indicated, and have
         been prepared in conformity with generally accepted accounting
         principles applied on a consistent basis throughout the periods
         involved. The other financial data, selected pro forma ratios,
         operating data and statistical information and data, including Adjusted
         EBITDA and Adjusted EBITDAR (each as defined in the Offering
         Memorandum), included in the Offering Memorandum is presented fairly
         and has been prepared on a basis consistent with such financial
         statements and the books and records of the Company.

                  (s) Except as set forth in the Offering Memorandum, there are
         no legal or governmental proceedings pending to which the Company or
         any of the Subsidiary Guarantors is a party or of which any property or
         assets of the Company or any of the Subsidiary Guarantors is the
         subject which, if determined adversely to the Company or any of the
         Subsidiary Guarantors, would have a Material Adverse Effect, and to the
         Company's knowledge, no such proceedings are threatened or contemplated
         by governmental authorities or others.

                  (t) Except as set forth in the Offering Memorandum, there are
         no contracts, agreements or understandings between the Company and/or
         the Subsidiary Guarantors and any person granting such person the right
         to require the Company or the Subsidiary Guarantors to file a
         registration statement under the Securities Act with respect to any
         securities of the Company or the Subsidiary Guarantors owned or to be
         owned by such person or to require the Company or the Subsidiary
         Guarantors to include such securities


                                                                               8


         in the securities to be registered pursuant to the Exchange Offer
         Registration Statement or the Shelf Registration Statement or in any
         securities registered or to be registered pursuant to any other
         registration statement filed by or required to be filed by the Company
         or the Subsidiary Guarantors under the Securities Act.

                  (u) Except as disclosed in the Offering Memorandum, since the
         date of the latest audited consolidated financial statements of the
         Company included in the Offering Memorandum, none of the Company or the
         Subsidiary Guarantors has incurred any liability or obligation, direct
         or contingent, or entered into any transaction, in each case not in the
         ordinary course of business, that is material to the Company or the
         Subsidiary Guarantors, taken as a whole, and there has not occurred, to
         the knowledge of the Company and the Subsidiary Guarantors, any
         development or event involving a Material Adverse Effect and, except as
         disclosed in or contemplated by the Offering Memorandum, there has been
         no (i) dividend or distribution of any kind declared, paid or made by
         the Company or its affiliates on any class of its respective capital
         stock, (ii) issuance of securities by the Company or its affiliates
         (other than the Notes and the Guarantees offered thereby or pursuant to
         an issuance by the Company or its affiliates of options to purchase the
         capital stock of the Company or its affiliates) or (iii) material
         increase in short-term or long-term debt of the Company or the
         Subsidiary Guarantors.

                  (v) The Company is in full compliance with the reporting
         requirements of Section 13 or 15(d) of the Exchange Act. All reports
         filed by the Company with the Commission pursuant to Section 13 or
         15(d) of the Exchange Act comply as to form with the Exchange Act and
         the rules and regulations of the Commission thereunder and when filed
         did not include any untrue statement of a material fact or omit to
         state any material fact necessary to make the statements therein not
         misleading.

                  (w) The Company and each Subsidiary Guarantor (i) makes and
         keeps accurate books and records and (ii) maintains a system of
         internal accounting controls sufficient to provide reasonable assurance
         that (A) transactions are executed in accordance with management's
         authorization, (B) transactions are recorded as necessary to permit
         preparation of its financial statements in conformity with generally
         accepted accounting principles and to maintain accountability for its
         assets, (C) access to its assets is permitted only in accordance with
         management's authorization and (D) the recorded accountability for its
         assets is compared with existing assets at reasonable intervals and
         appropriate action is taken with respect to any differences.

                  (x) KPMG LLP, who have certified certain financial statements
         of the Company, whose report appears in the Offering Memorandum and who
         have delivered the initial letter referred to in Section 7(j) hereof,
         are independent public accountants as required by the Securities Act
         and the rules and regulations promulgated thereunder.

                  (y) The statistical and market-related data included in the
         Offering Memorandum are based on or derived from sources that the
         Company and the subsidiaries believe to be reliable and accurate.


                                                                               9


                  (z) Except as disclosed in or specifically contemplated by the
         Offering Memorandum, each of the Company and the Subsidiary Guarantors
         has such permits, licenses, patents, franchises, certificates of need
         and other approvals or authorizations of governmental or regulatory
         authorities ("PERMITS") as are necessary under applicable law to own
         its properties and to conduct its businesses in the manner described in
         the Offering Memorandum, except where the failure to have any such
         Permit would not, individually or in the aggregate, have a Material
         Adverse Effect; each of the Company and the Subsidiary Guarantors has
         fulfilled and performed all of its obligations with respect to the
         Permits, except where the failure to so fulfill and/or perform such
         obligations would not have a Material Adverse Effect; and, except as
         disclosed in or specifically contemplated by the Offering Memorandum,
         no event has occurred which allows, or after notice or lapse of time
         would allow, revocation or termination thereof or results in any other
         impairment of the rights of the holder of any such Permit, except where
         any such revocations, terminations or impairments would not,
         individually or in the aggregate, have a Material Adverse Effect.
         Except as disclosed in or specifically contemplated by the Offering
         Memorandum, none of the Permits contains any restriction that is
         materially burdensome (other than such burdens as are common or
         customary to such Permits) to any of the Company or the Subsidiary
         Guarantors.

                  (aa) The Company and each of the Subsidiary Guarantors carry,
         or are covered by, insurance in such amounts and covering such risks as
         is adequate for the conduct of their respective businesses and the
         value of their respective properties and as is customary for companies
         engaged in similar businesses in similar industries.

                  (bb) The Company and each of the Subsidiary Guarantors own or
         possess adequate rights to use all patents, patent applications,
         trademarks, service marks, trade names, trademark registrations,
         service mark registrations, copyrights and licenses necessary for the
         conduct of their respective businesses and have no reason to believe
         that the conduct of their respective businesses will conflict with, and
         have not received any notice of any claim of conflict with, any such
         rights of others, and the Company and the Subsidiary Guarantors are not
         aware of any pending or threatened claim to the contrary or any pending
         or threatened challenge by any other person to the rights of the
         Company and the Subsidiary Guarantors with respect to the foregoing
         which, if determined adversely to any of the Company or the Subsidiary
         Guarantors, would have a Material Adverse Effect.

                  (cc) There are no contracts or other documents which would be
         required to be described in a prospectus included in or filed as an
         exhibit to a registration statement on Form S-1 under the Securities
         Act that have not been described in the Offering Memorandum or filed
         with the Commission.

                  (dd) No relationship, direct or indirect, exists between or
         among the Company and the Subsidiary Guarantors, on the one hand, and
         the directors, officers, shareholders, customers or suppliers of the
         Company or the Subsidiary Guarantors, on the other hand, which would be
         required to be described in a prospectus included in a registration
         statement on Form S-1 under the Securities Act that is not described in
         the Offering Memorandum.


                                                                              10


                  (ee) No labor disturbance by the employees of the Company or
         any of the Subsidiary Guarantors exists or, to the knowledge of the
         Company, is imminent which would have a Material Adverse Effect.

                  (ff) The Company is in compliance in all material respects
         with all presently applicable provisions of the Employee Retirement
         Income Security Act of 1974, as amended, including the regulations and
         published interpretations thereunder ("ERISA"); no "reportable event"
         (as defined in ERISA) has occurred with respect to any "pension plan"
         (as defined in ERISA) for which the Company would have any material
         liability; the Company has not incurred and does not expect to incur
         any material liability under (i) Title IV of ERISA with respect to
         termination of, or withdrawal from, any "pension plan" or (ii) Sections
         412 or 4971 of the Internal Revenue Code of 1986, as amended, including
         the regulations and published interpretations thereunder (the "CODE");
         and each "pension plan" for which the Company would have any liability
         that is intended to be qualified under Section 401(a) of the Code is so
         qualified in all material respects and nothing has occurred, whether by
         action or by failure to act, which would cause the loss of such
         qualification.

                  (gg) The Company and the Subsidiary Guarantors have filed all
         federal, state and local income and franchise tax returns required to
         be filed through the date hereof, other than those being contested in
         good faith, and paid all taxes due thereon, other than those being
         contested in good faith, and no tax deficiency has been determined
         adversely to the Company or any of the Subsidiary Guarantors, nor does
         the Company have any knowledge of any tax deficiency which, if
         determined adversely to the Company or any of the Subsidiary
         Guarantors, would have a Material Adverse Effect.

                  (hh) Neither the Company nor any of the Subsidiary Guarantors
         (i) is in violation of its charter, bylaws or other organizational
         documents, (ii) is in default, and no event has occurred which, with
         notice or lapse of time or both, would constitute such a default, in
         the due performance or observance of any term, covenant or condition
         contained in any material indenture, mortgage, deed of trust, loan
         agreement or other agreement or instrument to which it is a party or by
         which it is bound or to which any of its properties or assets is
         subject, except for such defaults that would not have a Material
         Adverse Effect, or (iii) is in violation of any law, ordinance,
         governmental rule, regulation or court decree to which it or its
         property or assets may be subject, except for such violations that
         would not have a Material Adverse Effect.

                  (ii) Neither the Company nor any of the Subsidiary Guarantors,
         nor any current director or officer, or to the Company's knowledge, any
         current agent, employee or other person associated with or acting on
         behalf of the Company or any of the Subsidiary Guarantors, has used any
         corporate funds for any unlawful contribution, gift, entertainment or
         other unlawful expense relating to political activity; made any direct
         or indirect unlawful payment to any foreign or domestic government
         official or employee from corporate funds; violated or is in violation
         of any provision of the Foreign Corrupt Practices Act of 1977; or made
         any bribe, rebate, payoff, influence payment, kickback or other
         unlawful payment.



                                                                              11


                  (jj) Neither the Company nor the Subsidiary Guarantors has
         stored, disposed of, generated, manufactured, refined, transported,
         handled or treated toxic wastes, medical wastes, solid wastes,
         hazardous wastes or hazardous substances or other similar materials
         ("Hazardous Materials") and, to the knowledge of the Company, there has
         been no storage, disposal, generation, manufacture, refinement,
         transportation, handling or treatment of Hazardous Materials by any
         other person at, upon or from any of the properties now owned or leased
         by the Company or the Subsidiary Guarantors in violation of any
         applicable law, ordinance, rule, regulation, order, judgment, decree or
         permit which could reasonably be expected to have, individually or in
         the aggregate with all such violations, a Material Adverse Effect;
         there has been no material spill, discharge, leak, emission, injection,
         escape, dumping or release of any kind onto such property or into the
         environment surrounding such property of any toxic wastes, medical
         wastes, solid wastes, hazardous wastes or hazardous substances due to
         or caused by the Company or any of the Subsidiary Guarantors or with
         respect to which the Company or any of the Subsidiary Guarantors have
         knowledge, which could reasonably be expected to have, individually or
         in the aggregate with all such spills, discharges, leaks, emissions,
         injections, escapes, dumpings and releases, a Material Adverse Effect;
         and the terms "hazardous wastes," "toxic wastes," "hazardous
         substances," "solid wastes" and "medical wastes" shall have the
         meanings specified in any applicable local, state, federal and foreign
         laws or regulations with respect to environmental protection.

                  (kk) The Company and each of the Subsidiary Guarantors have
         good and marketable title in fee simple to all real property and good
         and marketable title to all personal property owned by them, in each
         case, free and clear of all liens, encumbrances and defects except such
         as are existing under the Existing Credit Facility (which will be
         assigned to the lenders under the New Credit Facility as of the Closing
         Date) and the other indebtedness of the Company described in the
         Offering Memorandum under "Description of Other Indebtedness" or such
         as do not materially affect the value of such property and do not
         materially interfere with the use made and proposed to be made of such
         property by the Company and the Subsidiary Guarantors; and all assets
         held under lease by the Company and the Subsidiary Guarantors are held
         by them under valid, subsisting and enforceable leases, with such
         exceptions as are not material and do not interfere with the use made
         and proposed to be made of such assets by the Company and the
         Subsidiary Guarantors.

                  (ll) Immediately after the consummation of the Transactions,
         the fair value and present fair saleable value of the assets of the
         Company and each of the Subsidiary Guarantors (each on a consolidated
         basis) will exceed the sum of its stated liabilities and identified
         contingent liabilities; none of the Company nor any of the Subsidiary
         Guarantors (each on a consolidated basis) is, nor will any of the
         Company or any of the Subsidiary Guarantors (each on a consolidated
         basis) be, after giving effect to the execution, delivery and
         performance of this Agreement and the other Operative Documents and the
         New Credit Facility and the other Credit Documents and the consummation
         of the Transactions, (A) left with unreasonably small capital with
         which to carry on its business as it is proposed to be conducted, (B)
         unable to pay its debts (contingent or otherwise) as they mature or (C)
         otherwise insolvent.



                                                                              12


                  (mm) Neither the Company nor any Subsidiary Guarantor is, or,
         as of the Closing Date after giving effect to the Transactions and the
         application of the proceeds as described in the Offering Memorandum
         under the section entitled "Use of Proceeds," will be, an "investment
         company" within the meaning of such term under the Investment Company
         Act of 1940, as amended (the "INVESTMENT COMPANY ACT").

                  (nn) Except as set forth in the Offering Memorandum, neither
         the Company nor any of the Subsidiary Guarantors nor, to the knowledge
         of the Company, any other person who has a direct or indirect ownership
         or control interest in the Company or any of the Subsidiary Guarantors
         or who is an officer, director, agent or managing employee of the
         Company or any Subsidiary Guarantor: (1) has engaged in any activities
         which are prohibited, or are cause for criminal or civil penalties
         and/or mandatory or permissive exclusion from Medicare or Medicaid,
         under Section 1320a-7, 1320a-7a, 1320a-7b, or 1395nn of Title 42 of the
         United States Code, the federal TRICARE statute, the Federal False
         Claims Act 31 U.S.C.ss.3729-3733, or the regulations promulgated
         pursuant to such statutes or regulations or related state or local
         statutes or by generally recognized professional standards of care or
         conduct; (2) has had a civil monetary penalty assessed against it under
         Section 1128A of the Social Security Act ("SSA"); (3) is currently
         excluded from participation under the Medicare program or a Federal
         Health Care Program (as that term is defined in SSA Section
         1128(B)(f)); or (4) has been convicted (as that term is defined in 42
         C.F.R. ss.1001.2) of any of the categories of offenses described in SSA
         Section 1128(a) and (b)(1), (2) and (3).

                  (oo) Neither the Company nor any other affiliate (as defined
         in Rule 501(b) of Regulation D under the Securities Act ("REGULATION
         D")) of the Company has directly, or through any agent (provided that
         no representation is made as to the Initial Purchasers or any person
         acting on their behalf), (i) sold, offered for sale, solicited offers
         to buy or otherwise negotiated in respect of, any security (as defined
         in the Securities Act) which is or could be integrated with the
         offering and sale of the Notes and the Guarantees in a manner that
         would require the registration of the Notes and the Guarantees under
         the Securities Act or (ii) engaged in any form of general solicitation
         or general advertising (within the meaning of Regulation D, including,
         but not limited to, advertisements, articles, notices or other
         communications published in any newspaper, magazine, or similar medium
         or broadcast over television or radio, or any seminar or meeting whose
         attendees have been invited by any general solicitation or general
         advertising) in connection with the offering of the Notes and the
         Guarantees. Neither the Company nor any Subsidiary Guarantor has
         offered, sold or issued any securities, or securities that are
         convertible into other securities, with terms that are substantially
         similar to the Notes and the Guarantees during the six-month period
         preceding the date of the Offering Memorandum, including any sales
         pursuant to Section 4(2) of the Securities Act or Regulation D or
         Regulation S under the Securities Act.

                  (pp) Each of the Preliminary Offering Memorandum and the
         Offering Memorandum and each amendment or supplement thereto, as of its
         date, contains the information specified in, and meets the requirements
         of, Rule 144A(d)(4) under the Act.



                                                                              13


                  (qq) Neither the Company nor any Subsidiary Guarantor has
         distributed and, prior to the later to occur of the Closing Date and
         completion of the distribution of the Notes and the Guarantees, will
         not distribute any offering material in connection with the offering
         and sale of the Notes other than the Preliminary Offering Memorandum
         and the Offering Memorandum.

                  (rr) When issued and delivered pursuant to this Agreement, the
         Notes will not be of the same class (within the meaning of Rule 144A
         under the Securities Act) as securities of the Company that are listed
         on a national securities exchange registered under Section 6 of the
         Exchange Act or that are quoted in a U.S. automated inter-dealer
         quotation system.

                  (ss) Assuming (i) that your representations and warranties in
         Section 2 of this Agreement are true, (ii) compliance by you with the
         covenants set forth herein and (iii) that each of the Eligible
         Purchasers is a QIB or a person who acquires the Notes and the
         Guarantees outside the United States in an "offshore transaction" and
         is not a "U.S. person" (within the meaning of Rule 904 of Regulation
         S), it is not necessary in connection with the purchase of the Notes
         and the Guarantees and the offer and initial resale of the Notes and
         the Guarantees by you in the manner contemplated by this Agreement and
         the Offering Memorandum, to register the Notes and the Guarantees under
         the Securities Act or to qualify the Indenture under the Trust
         Indenture Act.

                  (tt) None of the Company, any Subsidiary Guarantor or any of
         their affiliates or any person acting on their behalf (provided that no
         representation is made as to the Initial Purchasers or any person
         acting on their behalf) has engaged or will engage in any directed
         selling efforts within the meaning of Rule 902(c) of Regulation S with
         respect to the Notes, and the Company, the Subsidiary Guarantors and
         their other affiliates and all persons acting on their behalf (provided
         that no representation is made as to the Initial Purchasers or any
         person acting on their behalf) have complied with and will comply with
         the offering restrictions requirements of Regulation S in connection
         with the offering of the Notes outside of the United States and, in
         connection therewith, the Offering Memorandum will contain the
         disclosure required by Rule 902(g). The sales of the Notes pursuant to
         Regulation S are not part of a plan or scheme to evade the registration
         provision of the Securities Act.

                  (uu) The Notes sold in reliance on Regulation S will be
         represented upon issuance by a temporary global security that may not
         be exchanged for definitive securities until the expiration of the
         40-day restricted period referred to in Rule 903(b)(2) of the
         Securities Act and only upon certification of beneficial ownership of
         such Notes by non-U.S. persons or U.S. persons who purchased such Notes
         in transactions that were exempt from the registration requirements of
         the Securities Act.

                  (vv) In connection with the distribution of the Notes and the
         Guarantees, neither the Company nor any of its subsidiaries has taken
         or will take, directly or indirectly, any action designed to cause or
         result in, or which has constituted or which might reasonably be
         expected to constitute, the stabilization or manipulation of the price


                                                                              14


         of the Notes and the Guarantees to facilitate the sale or resale of the
         Notes and the Guarantees.

                  (ww) No "nationally recognized statistical rating
         organization" as such term is defined for purposes of Rule 436(g)(2)
         under the Securities Act (i) has imposed (or has informed the Company
         that it is considering imposing) any condition (financial or otherwise)
         on the Company's retaining any rating assigned as of the date hereof to
         the Company or any of their respective securities or (ii) has indicated
         to the Company that it is considering (A) the downgrading, suspension
         or withdrawal of, or any review for a possible change that does not
         indicate the direction of the possible change in, any rating so
         assigned or (B) any negative change in the outlook for any rating of
         the Company.

                  (xx) The Company has not taken, and will not take, any action
         that might cause this Agreement or the issuance or sale of the Notes
         and the Guarantees to violate Regulation T (12 C.F.R. Part 220),
         Regulation U (12 C.F.R. Part 221) or Regulation X (12 C.F.R. Part 224)
         of the Board of Governors of the Federal Reserve System.

                  (yy) The Company and each Subsidiary Guarantor understands
         that the Initial Purchaser and, for purposes of the opinions to be
         delivered to the Initial Purchaser pursuant to Section 7 hereof,
         counsel to the Company and counsel to the Initial Purchasers will rely
         upon the accuracy and truth of the foregoing representations and hereby
         consents to such reliance.

                  SECTION 2. Representations, Warranties and Agreements of the
Initial Purchasers. Each of the Initial Purchasers, severally and not jointly,
represents and warrants to, and agrees with, the Company and the Subsidiary
Guarantors, that:

                  (a) Such Initial Purchaser is a QIB with such knowledge and
         experience in financial and business matters as are necessary in order
         to evaluate the merits and risks of an investment in the Notes and the
         Guarantees.

                  (b) Such Initial Purchaser (i) is not acquiring the Notes and
         the Guarantees with a view to any distribution thereof or with any
         present intention of offering or selling any of the Notes and the
         Guarantees in a transaction that would violate the Securities Act or
         any state securities laws or any other applicable jurisdiction; (ii) in
         connection with the Exempt Resales, will solicit offers to buy the
         Notes and the Guarantees only from, and will offer to sell the Notes
         and the Guarantees only to, the Eligible Purchasers in accordance with
         this Agreement and on the terms contemplated by the Offering
         Memorandum; and (iii) will not offer or sell the Notes and the
         Guarantees, nor has it offered or sold the Notes and the Guarantees by,
         or otherwise engaged in, any form of general solicitation in connection
         with the offering of the Notes and the Guarantees.

                  (c) The Notes and the Guarantees have not been and will not be
         registered under the Securities Act and may not be offered or sold
         within the United States or to, or for the account or benefit of, U.S.
         persons except in accordance with Regulation S under the Securities Act
         or pursuant to an exemption from the registration requirements of the
         Securities Act. Such Initial Purchaser represents that it has not
         offered, sold or delivered



                                                                              15


         the Notes and the Guarantees, and will not offer, sell or deliver the
         Notes and the Guarantees (i) as part of their distribution at any time
         or (ii) otherwise until 40 days after the later of the commencement of
         the offering of the Notes and the Guarantees and the Closing Date (such
         period, the "DISTRIBUTION COMPLIANCE PERIOD"), within the United States
         or to, or for the account or benefit of U.S. persons, except in
         accordance with Rule 144A under the Securities Act. Accordingly, such
         Initial Purchaser represents and agrees that neither it, its affiliates
         nor any persons acting on its behalf have engaged or will engage in any
         directed selling efforts within the meaning of Rule 902(c) of
         Regulation S with respect to the Notes and the Guarantees, and its
         affiliates and all persons acting on its behalf have complied and will
         comply with the offering restrictions requirements of Regulation S.

                  (d) Such Initial Purchaser agrees that, at or prior to
         confirmation of a sale of Notes and Guarantees (other than a sale
         pursuant to Rule 144A), it will have sent to each distributor, dealer
         or person receiving a selling concession, fee or other remuneration
         that purchases Notes and Guarantees from them during the Distribution
         Compliance Period a confirmation or notice substantially to the
         following effect:

                  "The Notes covered hereby have not been registered under the
                  Securities Act of 1933 (the "Securities Act") and may not be
                  offered and sold within the United States or to, or for the
                  account or benefit of, U.S. persons (i) as part of their
                  distribution at any time or (ii) otherwise until 40 days after
                  the later of the commencement of the offering or the closing
                  date, except in either case in accordance with Regulation S
                  (or Rule 144A if available) under the Securities Act, and in
                  connection with any subsequent sale by you of the Notes
                  covered hereby in reliance on Regulation S during the period
                  referred to above to any distributor, dealer or person
                  receiving a selling concession, fee or other remuneration, you
                  must deliver a notice substantially to the foregoing effect.
                  Terms used above have the meanings assigned to them in
                  Regulation S."

                  (e) All offers and sales of the Notes and the Guarantees by
         such Initial Purchaser pursuant to Regulation S are and will be
         "offshore transactions" within the meaning of Regulation S and are not
         and will not be part of a plan or scheme to evade the registration
         provisions of the Securities Act.

                  (f) Such Initial Purchaser (i) has not offered or sold, and
         prior to the six months after the date of the issue of the Notes will
         not offer or sell, any Notes to persons in the United Kingdom except to
         persons whose ordinary activities involve them in acquiring, holding,
         managing or disposing of investments (as principal or agent) for
         purposes of their businesses or otherwise in circumstances which have
         not resulted and will not result in an offer to the public in the
         United Kingdom within the meaning of the Public Offers of Securities
         Regulations 1995, (ii) has complied with and will comply with all
         applicable provisions of the Financial Services and Markets Act 2000,
         or the FSMA, with respect to anything done by it in relation to the
         Notes in, from or otherwise involving the United Kingdom and (iii) has
         only communicated or caused to be communicated and will only
         communicate and cause to be communicated any invitation



                                                                              16


         or inducement to engage in investment activity (within the meaning of
         Section 21 of the FSMA) received by it in connection with the issue or
         sale of any Notes in circumstances in which Section 21(1) of the FSMA
         would not apply to the Company.

                  (g) Such Initial Purchaser understands that the Company and,
         for purposes of the opinions to be delivered to you pursuant to Section
         7 hereof, counsel to the Company and counsel to the Initial Purchasers
         will rely upon the accuracy and truth of the foregoing representations
         and hereby consents to such reliance.

                  The terms used in this Section 2 that have meanings assigned
to them in Regulation S are used herein as so defined.

                  SECTION 3. Purchase of the Notes and the Guarantees by the
Initial Purchasers. On the basis of the representations and warranties contained
in, and subject to the terms and conditions of, this Agreement, the Company
agrees to sell the Notes (and cause the Subsidiary Guarantors to issue the
Guarantees) to the several Initial Purchasers and each of the Initial
Purchasers, severally and not jointly, agrees to purchase the amount of Notes
set opposite that Initial Purchaser's name in Schedule 1 hereto. Each Initial
Purchaser will purchase such aggregate principal amount of Notes at an aggregate
purchase price equal to 96.75% of the principal amount thereof (the "PURCHASE
PRICE").

                  The Company shall not be obligated to deliver any of the Notes
to be delivered on the Closing Date, except upon payment for all the Notes and
the Guarantees to be purchased on the Closing Date as provided herein.

                  SECTION 4. Delivery of and Payment for the Notes and the
Guarantees.

                  (a) Delivery of and payment for the Notes and the Guarantees
         shall be made at the offices of Weil, Gotshal & Manges LLP, 767 Fifth
         Avenue, New York, New York 10153, at 9:00 A.M., New York City time, on
         the sixth full business day following the date of this Agreement or at
         such other date or place as shall be determined by agreement between
         Lehman Brothers and the Company. This date and time are sometimes
         referred to as the "CLOSING DATE."

                  (b) On the Closing Date, one or more Notes in definitive form,
         registered in the name of Cede & Co., as nominee of The Depository
         Trust Company ("DTC"), having an aggregate principal amount
         corresponding to the aggregate principal amount of the Notes
         (collectively, the "GLOBAL NOTES"), shall be delivered by the Company
         to the Initial Purchasers against payment by the Initial Purchasers of
         the purchase price thereof by wire transfer of immediately available
         funds as the Company may direct by written notice delivered to you no
         later than two business days prior to the Closing Date. The Global
         Notes in definitive form shall be made available to the Initial
         Purchasers for inspection not later than 2:00 p.m. on the business day
         prior to the Closing Date.

                  SECTION 5. Further Agreements of the Company. The Company
agrees:

                  (a) To advise you promptly and, if requested by you, to
         confirm such advice in writing, (i) of the issuance by the Commission
         or any state securities commission of



                                                                              17


         any stop order suspending the qualification or exemption from
         qualification of the Notes and the Guarantees for offering or sale in
         any jurisdiction, or the initiation or threatening of any proceeding
         for such purpose by the Commission or any state securities commission
         or other regulatory authority, and (ii) the happening of any event that
         makes any statement of a material fact made in the Preliminary Offering
         Memorandum or the Offering Memorandum untrue or which requires the
         making of any additions to or changes in the Preliminary Offering
         Memorandum or Offering Memorandum in order to make the statements
         therein, in the light of the circumstances under which they were made,
         not misleading. The Company shall use all reasonable efforts to prevent
         the issuance of any stop order or order suspending the qualification or
         exemption of the Notes and the Guarantees under any state securities or
         Blue Sky laws and, if at any time any state securities commission shall
         issue any stop order suspending the qualification or exemption of the
         Notes and the Guarantees under any state securities or Blue Sky laws,
         the Company shall use all reasonable efforts to obtain the withdrawal
         or lifting of such order at the earliest possible time.

                  (b) To furnish to you without charge, as many copies of the
         Preliminary Offering Memorandum and the Offering Memorandum, and any
         amendments or supplements thereto, as you may reasonably request. The
         Company consents to the use of the Preliminary Offering Memorandum and
         the Offering Memorandum, and any amendments and supplements thereto
         required pursuant to this Agreement, by you in connection with the
         Exempt Resales that are in compliance with this Agreement.

                  (c) Not to amend or supplement the Offering Memorandum prior
         to the Closing Date or during the period referred to in (d) below
         unless you shall previously have been advised of, and shall not have
         reasonably objected to, such amendment or supplement within a
         reasonable time, but in any event not longer than three days after
         being furnished a copy of such amendment or supplement. The Company
         shall promptly prepare, upon any reasonable request by you, any
         amendment or supplement to the Offering Memorandum that may be
         necessary or advisable in connection with Exempt Resales.

                  (d) If, in connection with any Exempt Resales or market making
         transactions after the date of this Agreement and prior to the
         consummation of the Registered Exchange Offer, any event shall occur
         that, in the judgment of the Company or in your judgment or the
         judgment of counsel to you, makes any statement of a material fact in
         the Offering Memorandum untrue or that requires the making of any
         additions to or changes in the Offering Memorandum in order to make the
         statements in the Offering Memorandum, in the light of the
         circumstances at the time that the Offering Memorandum is delivered to
         prospective Eligible Purchasers, not misleading, or if it is necessary
         to amend or supplement the Offering Memorandum to comply with
         applicable law, the Company will promptly notify you of such event and
         prepare an appropriate amendment or supplement to the Offering
         Memorandum so that, at the time that the Offering Memorandum is
         delivered to prospective Eligible Purchasers, (i) the statements in the
         Offering Memorandum as amended or supplemented, in the light of the
         circumstances under which they were made, will not be misleading and
         (ii) the Offering Memorandum will comply with applicable law.



                                                                              18


                  (e) Promptly from time to time to take such action as you may
         reasonably request to qualify the Notes and the Guarantees for offering
         and sale under the state securities or Blue Sky laws of such
         jurisdictions as you may request (provided, however, that the Company
         shall not be obligated to qualify as a foreign corporation in any
         jurisdiction in which it is not now so qualified or to take any action
         that would subject it to general consent to service of process in any
         jurisdiction in which it is not now so subject) and to comply with such
         laws so as to permit the continuance of sales and dealings therein in
         such jurisdictions for as long as may be necessary to complete the
         distribution of the Notes and the Guarantees.

                  (f) To use all reasonable best efforts to do and perform all
         things required to be done and performed under this Agreement by it
         prior to or after the Closing Date and to satisfy all conditions
         precedent on its part to the delivery of the Notes and the Guarantees.

                  (g) Except as contemplated in the Registration Rights
         Agreement, not to sell, offer for sale or solicit offers to buy or
         otherwise negotiate in respect of any security (as defined in the
         Securities Act) that would be integrated with the sale of the Notes and
         the Guarantees in a manner that would require the registration under
         the Securities Act of the sale to you or the Eligible Purchasers of the
         Notes and the Guarantees.

                  (h) For so long as any Notes remain outstanding and are
         "restricted securities" within the meaning of Rule 144(a)(3) under the
         Securities Act and during any period in which the Company is not
         subject to Section 13 or 15(d) of the Exchange Act, to make available
         upon request to any registered holder or beneficial owner of Notes in
         connection with any sale thereof and any prospective purchaser of Notes
         from such registered holder or beneficial owner, the information
         required by Rule 144A(d)(4) under the Securities Act.

                  (i) To use its reasonable best efforts to cause the Notes to
         be eligible for trading in The PORTAL(SM) Market ("PORTAL"), a
         subsidiary of The Nasdaq Stock Market, Inc., and to permit the Notes to
         be eligible for clearance and settlement through DTC.

                  (j) To apply the net proceeds from the sale of the Notes as
         set forth in the Offering Memorandum under the section entitled "Use of
         Proceeds."

                  (k) To take such steps as shall be necessary to ensure that
         neither the Company nor any subsidiary of the Company shall become an
         "investment company" within the meaning of such term under the
         Investment Company Act and the rules and regulations of the Commission
         thereunder.

                  (l) Except for borrowings under the New Credit Facility, for a
         period of 180 days from the date of the Offering Memorandum, not to,
         directly or indirectly, sell, contract to sell, grant any option to
         purchase, issue any instrument convertible into or exchangeable for, or
         otherwise transfer or dispose of, any debt securities of the Company or
         any Subsidiary Guarantor in a public or private offering for cash
         having a maturity of



                                                                              19


         more than one year from the date of issue of such securities, except
         (i) for the Exchange Notes and the Exchange Note Guarantees in
         connection with the Exchange Offer or (ii) with the prior consent of
         the Initial Purchasers, which consent shall not be unreasonably
         withheld.

                  (m) For a period of three years following the Closing Date, to
         furnish to you copies of all materials furnished by the Company to
         holders of Notes and all public reports and all reports and financial
         statements furnished by the Company to the principal national
         securities exchange upon which the Company's common stock or Notes may
         be listed pursuant to requirements of or agreements with such exchange
         or to the Commission pursuant to the Exchange Act or any rule or
         regulation of the Commission thereunder.

                  SECTION 6. Expenses. The Company agrees that, whether or not
the transactions contemplated by this Agreement are consummated or this
Agreement becomes effective or is terminated, to pay all costs, expenses, fees
and taxes incident to and in connection with: (i) the preparation, printing,
filing and distribution of the Preliminary Offering Memorandum and the Offering
Memorandum (including, without limitation, financial statements) and all
amendments and supplements thereto (but not, however, legal fees and expenses of
your counsel incurred in connection therewith), (ii) the preparation, printing
(including, without limitation, word processing and duplication costs) and
delivery of this Agreement, the Indenture, all Blue Sky Memoranda and all other
agreements, memoranda, correspondence and other documents printed and delivered
in connection herewith and with the Exempt Resales (but not, however, legal fees
and expenses of your counsel incurred in connection with any of the foregoing
other than fees of such counsel plus reasonable disbursements incurred in
connection with the preparation, printing and delivery of such Blue Sky
Memoranda), (iii) the issuance and delivery by the Company and the Subsidiary
Guarantors of the Notes and the Guarantees, (iv) the qualification of the Notes
for offer and sale under the securities or Blue Sky laws of the several states
(including, without limitation, the reasonable fees and disbursements of your
counsel relating to such registration or qualification), (v) furnishing such
copies of the Preliminary Offering Memorandum and the Offering Memorandum, and
all amendments and supplements thereto, as may be reasonably requested for use
in connection with the Exempt Resales, (vi) the preparation of certificates for
the Notes (including, without limitation, printing and engraving thereof), (vii)
the fees, disbursements and expenses of the Company's counsel and accountants,
(viii) all expenses and listing fees in connection with the application for
quotation of the Notes in PORTAL, (ix) the costs and expenses of the Company
relating to investor presentations on any road show undertaken in connection
with the offering of the Notes, including without limitation, expenses
associated with the production of road show slides and graphics, fees and
expenses of any consultants engaged in connection with the road show
presentations with the prior approval of the Company, travel and lodging
expenses of the representatives and officers of the Company and any such
consultants, and the cost of any aircraft chartered in connection with the road
show; (x) all fees and expenses (including fees and expenses of counsel) of the
Company in connection with approval of the Notes by DTC for "book-entry"
transfer and (xi) the performance by the Company and the Subsidiary Guarantors
of its other obligations under this Agreement.



                                                                              20


                  SECTION 7. Conditions of Initial Purchasers' Obligations. The
respective obligations of the Initial Purchasers hereunder are subject to the
accuracy, when made and on the Closing Date, of the representations and
warranties of the Company contained herein, to the performance by the Company of
its obligations hereunder, and to each of the following additional terms and
conditions.

                  (a) The Offering Memorandum shall have been printed and copies
         distributed to you not later than 9:00 A.M., New York City time, on
         June 24, 2002, or at such later date and time as you may approve in
         writing, and no stop order suspending the qualification or exemption
         from qualification of the Notes in any jurisdiction shall have been
         issued and no proceeding for that purpose shall have been commenced or
         shall be pending or threatened.

                  (b) No Initial Purchaser shall have discovered and disclosed
         to the Company on or prior to such Closing Date that the Offering
         Memorandum or any amendment or supplement thereto contains an untrue
         statement of a fact which, in the opinion of Weil, Gotshal & Manges
         LLP, counsel for the Initial Purchasers, is material or omits to state
         a fact which, in the opinion of such counsel, is material and is
         required to be stated therein or is necessary to make the statements
         therein not misleading.

                  (c) All corporate proceedings and other legal matters incident
         to the authorization, form and validity of this Agreement, the other
         Operative Documents, the Credit Documents, the Swap Agreement and the
         Offering Memorandum, and all other legal matters relating to this
         Agreement and the Transactions shall be reasonably satisfactory in all
         material respects to counsel for the Initial Purchasers, and the
         Company shall have furnished to such counsel all documents and
         information that they may reasonably request to enable them to pass
         upon such matters.

                  (d) Foley & Lardner shall have furnished to the Initial
         Purchasers its written opinion, as counsel to the Company and the
         Subsidiary Guarantors, addressed to the Initial Purchasers and dated as
         of the Closing Date, in form and substance reasonably satisfactory to
         the Initial Purchasers and its counsel, substantially in the form
         attached hereto as Exhibit B.

                  (e) Roch Carter, Esq., General Counsel of the Company, shall
         have furnished to the Initial Purchasers his written opinion, as
         counsel to the Company and the Subsidiary Guarantors, addressed to the
         Initial Purchasers and dated as of the Closing Date, in form and
         substance reasonably satisfactory to the Initial Purchasers and its
         counsel, substantially in the form attached hereto as Exhibit C.

                  (f) The Initial Purchasers shall have received from Weil,
         Gotshal & Manges LLP, counsel for the Initial Purchasers, such opinion
         or opinions, dated as of the Closing Date, with respect to the issuance
         and sale of the Notes and the Guarantees, the Offering Memorandum and
         other related matters as the Initial Purchasers may reasonably require,
         and the Company shall have furnished to such counsel such documents as
         they reasonably request for the purpose of enabling them to pass upon
         such matters.



                                                                              21


                  (g) Each of the Company, the Subsidiary Guarantors and the
         Trustee shall have entered into the Indenture and the Initial
         Purchasers shall have received counterparts, conformed as executed,
         thereof.

                  (h) Each of the Company, the Subsidiary Guarantors and the
         Initial Purchasers shall have entered into the Registration Rights
         Agreement and the Initial Purchasers shall have received counterparts,
         conformed as executed, thereof.

                  (i) The Notes shall have been approved for trading in PORTAL
         and shall be eligible for clearance and settlement through The
         Depository Trust Company.

                  (j) At the time of execution of this Agreement, the Initial
         Purchasers shall have received from KPMG LLP, a letter, in form and
         substance satisfactory to the Initial Purchasers, addressed to the
         Initial Purchasers and dated the date hereof (i) confirming that they
         are independent public accountants within the meaning of the Securities
         Act and are in compliance with the applicable requirements relating to
         the qualification of accountants under Rule 2-01 of Regulation S-X of
         the Commission, (ii) stating, as of the date hereof (or, with respect
         to matters involving changes or developments since the respective dates
         as of which specified financial information is given in the Offering
         Memorandum, as of a date not more than five days prior to the date
         hereof), the conclusions and findings of such firm with respect to the
         financial information and other matters ordinarily covered by
         accountants' "comfort letters" to initial purchasers.

                  (k) With respect to the letter of KPMG LLP, referred to in the
         preceding paragraph and delivered to the Initial Purchasers
         concurrently with the execution of this Agreement (the "INITIAL
         LETTER"), the Initial Purchasers shall have received a letter (the
         "BRING-DOWN LETTER") of such accountants, addressed to the Initial
         Purchasers and dated as of the Closing Date (i) confirming that they
         are independent public accountants within the meaning of the Securities
         Act and are in compliance with the applicable requirements relating to
         the qualification of accountants under Rule 2-01 of Regulation S-X of
         the Commission, (ii) stating, as of the date of the bring-down letter
         (or, with respect to matters involving changes or developments since
         the respective dates as of which specified financial information is
         given in the Offering Memorandum, as of a date not more than five days
         prior to the date of the bring-down letter), the conclusions and
         findings of such firm with respect to the financial information and
         other matters covered by the initial letter and (iii) confirming in all
         material respects the conclusions and findings set forth in the initial
         letter.

                  (l) The Initial Purchasers shall have received an executed
         copy of the Credit Documents, with all schedules, exhibits and
         amendments thereto.

                  (m) The Initial Purchasers shall have received an executed
         copy of the services agreement between the Company and Virtual Care
         Provider, Inc. relating to certain services provided by us and Virtual
         Care Provider, Inc. to each other.

                  (n) The Initial Purchasers shall have received (i) a
         certificate from the Company, dated the Closing Date, signed by its
         Chairman of the Board or Chief



                                                                              22


         Executive Officer and its Chief Financial Officer or Treasurer and (ii)
         a certificate from each Subsidiary Guarantor, dated as of the Closing
         Date, signed by its President, other executive officer or authorized
         signatory stating, as applicable, that:

                                    (A) The representations and warranties of
                           the Company and the Subsidiary Guarantors, as
                           applicable, are true and correct as if made on and as
                           of the Closing Date (other than to the extent any
                           such representation or warranty is made expressly to
                           a certain date), and the Company and the Subsidiary
                           Guarantors, as applicable, have performed all
                           covenants and agreements and satisfied all conditions
                           on their part to be performed or satisfied hereunder,
                           to the extent a party hereto, at or prior to the
                           Closing Date;

                                    (B) At the Closing Date, since the date
                           hereof, except as described in the Offering
                           Memorandum, no event or events have occurred, nor has
                           any information become known that, individually or in
                           the aggregate, would have a Material Adverse Effect;

                                    (C) They have carefully examined the
                           Preliminary Offering Memorandum and the Offering
                           Memorandum and, in their opinion, the Preliminary
                           Offering Memorandum and Offering Memorandum, as of
                           their respective dates, did not, and the Offering
                           Memorandum, as of the Closing Date, does not include
                           any untrue statement of a material fact and did not
                           omit to state a material fact required to be stated
                           therein or necessary to make the statements therein
                           not misleading, and since the date of the Offering
                           Memorandum, no event has occurred which should have
                           been set forth in a supplement or amendment to
                           Offering Memorandum; and

                                    (D) The issuance and sale of the Notes and
                           Guarantees by the Company and the Subsidiary
                           Guarantors hereunder has not been enjoined
                           (temporarily or permanently) by any court or
                           governmental body or agency.

                  (o)      (i) Neither the Company nor any of the Subsidiary
         Guarantors shall have sustained since the date of the latest audited
         financial statements included in the Offering Memorandum (exclusive of
         any amendment or supplement thereto after the date hereof) any loss or
         interference with its business from fire, explosion, flood or other
         calamity, whether or not covered by insurance, or from any labor
         dispute or court or governmental action, order or decree, otherwise
         than as set forth or contemplated in the Offering Memorandum or (ii)
         since such date there shall not have been any change in the capital
         stock or long-term debt of the Company or any of the Subsidiary
         Guarantors or any change, or any development involving a prospective
         change, in or affecting the general affairs, management, financial
         position, shareholders' equity or results of operations of the Company
         and the Subsidiary Guarantors taken as a whole, otherwise than as set
         forth or contemplated in the Offering Memorandum, the effect of which,
         in any such case described in clause (i) or (ii), is, in the judgment
         of Lehman Brothers, so material and



                                                                              23


         adverse as to make it impracticable or inadvisable to proceed with the
         offering or the delivery of the Notes and the Guarantees being
         delivered on such Closing Date on the terms and in the manner
         contemplated in the Offering Memorandum.

                  (p) Subsequent to the execution and delivery of this Agreement
         (i) no downgrading shall have occurred in the rating accorded the
         Company's debt securities by any "nationally recognized statistical
         rating organization," as that term is defined by the Commission for
         purposes of Rule 436(g)(2) of the Securities Act and (ii) no such
         organization shall have publicly announced or privately informed the
         Company that it has under surveillance or review, with possible
         negative implications, its rating of any of the Company's debt
         securities.

                  (q) Subsequent to the execution and delivery of this Agreement
         there shall not have occurred any of the following: (i) trading in
         securities generally on the New York Stock Exchange, the Toronto Stock
         Exchange or the Nasdaq National Market shall have been suspended or the
         settlement of such trading generally shall have been materially
         disrupted or minimum prices shall have been established on any such
         exchange or such market by the Commission, by such exchange or by any
         other regulatory body or governmental authority having jurisdiction,
         (ii) a general banking moratorium shall have been declared by Federal
         or state authorities, (iii) the United States shall have become engaged
         in hostilities, there shall have been an escalation in hostilities
         involving the United States or there shall have been a declaration of a
         national emergency or war by the United States or (iv) there shall have
         occurred such a material adverse change in general economic, political
         or financial conditions (or the effect of international conditions on
         the financial markets in the United States shall be such) or there
         shall have occurred any other calamity or crisis, including without
         limitation as a result of terrorist activities after the date hereof,
         as to make it, in the judgment of Lehman Brothers, impracticable or
         inadvisable to proceed with the offering or delivery of the Notes and
         the Guarantees being delivered on such Closing Date on the terms and in
         the manner contemplated in the Offering Memorandum.

                  All opinions, letters, evidence and certificates mentioned
above or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance reasonably
satisfactory to counsel for the Initial Purchasers.

                  SECTION 8. Indemnification and Contribution.

                  (a) The Company and the Subsidiary Guarantors shall jointly
         and severally indemnify and hold harmless each Initial Purchaser, its
         directors, officers and employees and each person, if any, who controls
         any Initial Purchaser within the meaning of the Securities Act, from
         and against any loss, claim, damage or liability, joint or several, or
         any action in respect thereof (including, but not limited to, any loss,
         claim, damage, liability or action relating to purchases and sales of
         the Notes and the Guarantees), to which that Initial Purchaser,
         director, officer, employee or controlling person may become subject,
         under the Securities Act or otherwise, insofar as such loss, claim,
         damage, liability or action arises out of, or is based upon, (i) any
         untrue statement or alleged untrue statement of a material fact
         contained (A) in any Preliminary Offering



                                                                              24


         Memorandum, the Offering Memorandum or in any amendment or supplement
         thereto or (B) in any Blue Sky application or other document prepared
         or executed by the Company or the Subsidiary Guarantors (or based upon
         any written information furnished by the Company or the Subsidiary
         Guarantors) specifically for the purpose of qualifying any or all of
         the Notes under the securities laws of any state or other jurisdiction
         (any such application, document or information being hereinafter called
         a "BLUE SKY APPLICATION") or (C) in any materials or information
         provided to investors by, or with the approval of, the Company in
         connection with the marketing of the offering of the Notes ("MARKETING
         MATERIALS"), including any roadshow or investor presentations made to
         investors by the Company (whether in person or electronically), (ii)
         the omission or alleged omission to state in any Preliminary Offering
         Memorandum, the Offering Memorandum or in any amendment or supplement
         thereto, or in any Blue Sky Application or Marketing Materials, any
         material fact required to be stated therein or necessary to make the
         statements therein not misleading or (iii) any act or failure to act or
         any alleged act or failure to act by any Initial Purchaser in
         connection with, or relating in any manner to, the Notes and the
         Guarantees or the offering contemplated hereby, and which is included
         as part of or referred to in any loss, claim, damage, liability or
         action arising out of or based upon matters covered by clause (i) or
         (ii) above (provided that the Company and the Subsidiary Guarantors
         shall not be liable under this clause (iii) to the extent that it is
         determined in a final judgment by a court of competent jurisdiction
         that such loss, claim, damage, liability or action resulted directly
         from any such acts or failures to act undertaken or omitted to be taken
         by such Initial Purchaser through its gross negligence or willful
         misconduct), and shall reimburse each Initial Purchaser and each such
         director, officer, employee or controlling person promptly upon demand
         for any legal or other expenses reasonably incurred by that Initial
         Purchaser, director, officer, employee or controlling person in
         connection with investigating or defending or preparing to defend
         against any such loss, claim, damage, liability or action as such
         expenses are incurred; provided, however that the Company and the
         Subsidiary Guarantors will not be liable in any such case to the extent
         that any such loss, claim, damage, liability or action arises out of or
         is based upon any such untrue statement or alleged untrue statement or
         omission or alleged omission made in reliance upon and in conformity
         with written information furnished to the Company through Lehman
         Brothers by or on behalf of such Initial Purchaser expressly for
         inclusion therein. The foregoing indemnity agreement is in addition to
         any liability which the Company and the Subsidiary Guarantors may
         otherwise have to any Initial Purchaser or to any director, officer,
         employee or controlling person of that Initial Purchaser.

                  (b) Each Initial Purchaser shall, severally and not jointly,
         indemnify and hold harmless the Company, the Subsidiary Guarantors,
         their officers, each of their directors, and each person, if any, who
         controls the Company within the meaning of the Securities Act, from and
         against any loss, claim, damage or liability, joint or several, or any
         action in respect thereof, to which the Company, the Subsidiary
         Guarantors or any such director, officer or controlling person may
         become subject, under the Securities Act or otherwise, insofar as such
         loss, claim, damage, liability or action arises out of, or is based
         upon, (i) any untrue statement or alleged untrue statement of a
         material fact contained in any Preliminary Offering Memorandum, the
         Offering Memorandum or in any amendment or supplement thereto, or in
         any Blue Sky Application or (ii) the omission or alleged



                                                                              25


         omission to state in any Preliminary Offering Memorandum, the Offering
         Memorandum or in any amendment or supplement thereto, or in any Blue
         Sky Application any material fact required to be stated therein or
         necessary to make the statements therein not misleading, but in each
         case only to the extent that the untrue statement or alleged untrue
         statement or omission or alleged omission was made in reliance upon and
         in conformity with written information concerning such Initial
         Purchaser furnished to the Company through Lehman Brothers by or on
         behalf of that Initial Purchaser specifically for inclusion therein,
         and shall reimburse the Company, the Subsidiary Guarantors and any such
         director, officer or controlling person promptly upon demand for any
         legal or other expenses reasonably incurred by the Company or any such
         director, officer or controlling person in connection with
         investigating or defending or preparing to defend against any such
         loss, claim, damage, liability or action as such expenses are incurred.
         The foregoing indemnity agreement is in addition to any liability which
         any Initial Purchaser may otherwise have to the Company, the Subsidiary
         Guarantors or any such director, officer, employee or controlling
         person.

                  (c) Promptly after receipt by an indemnified party under this
         Section 8 of notice of any claim or the commencement of any action, the
         indemnified party shall, if a claim in respect thereof is to be made
         against the indemnifying party under this Section 8, notify the
         indemnifying party in writing of the claim or the commencement of that
         action; provided, however, that the failure to notify the indemnifying
         party shall not relieve it from any liability which it may have under
         this Section 8 except to the extent it has been materially prejudiced
         by such failure and, provided further, that the failure to notify the
         indemnifying party shall not relieve it from any liability which it may
         have to an indemnified party otherwise than under this Section 8. If
         any such claim or action shall be brought against an indemnified party,
         and it shall notify the indemnifying party thereof, the indemnifying
         party shall be entitled to participate therein and, to the extent that
         it wishes, jointly with any other similarly notified indemnifying
         party, to assume the defense thereof with counsel reasonably
         satisfactory to the indemnified party. After notice from the
         indemnifying party to the indemnified party of its election to assume
         the defense of such claim or action, the indemnifying party shall not
         be liable to the indemnified party under this Section 8 for any legal
         or other expenses subsequently incurred by the indemnified party in
         connection with the defense thereof other than reasonable costs of
         investigation; provided, however, that Lehman Brothers shall have the
         right to employ one counsel (and one local counsel) to represent
         jointly Lehman Brothers and those other Initial Purchasers and their
         respective directors, officers, employees and controlling persons who
         may be subject to liability arising out of any claim in respect of
         which indemnity may be sought by the Initial Purchasers against the
         Company under this Section 8 if, in the reasonable judgment of Lehman
         Brothers, it is advisable for Lehman Brothers and those Initial
         Purchasers, directors, officers, employees and controlling persons to
         be jointly represented by separate counsel, and in that event the fees
         and expenses of such separate counsel shall be paid by the Company. No
         indemnifying party shall (i) without the prior written consent of the
         indemnified parties (which consent shall not be unreasonably withheld),
         settle or compromise or consent to the entry of any judgment with
         respect to any pending or threatened claim, action, suit or proceeding
         in respect of which indemnification or contribution may be sought
         hereunder (whether or not the indemnified parties are actual or
         potential parties to such claim or action) unless



                                                                              26


         such settlement, compromise or consent includes an unconditional
         release of each indemnified party from all liability arising out of
         such claim, action, suit or proceeding and does not include any
         findings of fact or admissions of fault or culpability as to the
         indemnified party or (ii) be liable for any settlement of any such
         action effected without its written consent (which consent shall not be
         unreasonably withheld), but if settled with the consent of the
         indemnifying party or if there be a final judgment of the plaintiff in
         any such action, the indemnifying party agrees to indemnify and hold
         harmless any indemnified party from and against any loss or liability
         by reason of such settlement or judgment.

                  (d) If the indemnification provided for in this Section 8
         shall for any reason be unavailable to or insufficient to hold harmless
         an indemnified party under Section 8(a) or 8(b) in respect of any loss,
         claim, damage or liability, or any action in respect thereof, referred
         to therein, then each indemnifying party shall, in lieu of indemnifying
         such indemnified party, contribute to the amount paid or payable by
         such indemnified party as a result of such loss, claim, damage or
         liability, or action in respect thereof, (i) in such proportion as
         shall be appropriate to reflect the relative benefits received by the
         Company on the one hand and the Initial Purchasers on the other from
         the offering of the Notes and the Guarantees or (ii) if the allocation
         provided by clause (i) above is not permitted by applicable law, in
         such proportion as is appropriate to reflect not only the relative
         benefits referred to in clause (i) above but also the relative fault of
         the Company, on the one hand, and the Initial Purchasers, on the other,
         with respect to the statements or omissions which resulted in such
         loss, claim, damage or liability, or action in respect thereof, as well
         as any other relevant equitable considerations. The relative benefits
         received by the Company, on the one hand, and the Initial Purchasers,
         on the other, with respect to such offering shall be deemed to be in
         the same proportion as the total net proceeds from the offering of the
         Notes and the Guarantees purchased under this Agreement (before
         deducting expenses) received by the Company, on the one hand, and the
         total discounts and commissions received by the Initial Purchasers with
         respect to the Notes and the Guarantees purchased under this Agreement,
         on the other hand, bear to the total gross proceeds from the offering
         of the Notes and the Guarantees under this Agreement. The relative
         fault shall be determined by reference to whether the untrue or alleged
         untrue statement of a material fact or omission or alleged omission to
         state a material fact relates to information supplied by the Company or
         the Initial Purchasers, the intent of the parties and their relative
         knowledge, access to information and opportunity to correct or prevent
         such statement or omission. The Company, the Subsidiary Guarantors and
         the Initial Purchasers agree that it would not be just and equitable if
         contributions pursuant to this Section 8 were to be determined by pro
         rata allocation (even if the Initial Purchasers were treated as one
         entity for such purpose) or by any other method of allocation which
         does not take into account the equitable considerations referred to
         herein. The amount paid or payable by an indemnified party as a result
         of the loss, claim, damage or liability, or action in respect thereof,
         referred to above in this Section 8 shall be deemed to include, for
         purposes of this Section 8(d), any legal or other expenses reasonably
         incurred by such indemnified party in connection with investigating or
         defending or preparing to defend any such action or claim.
         Notwithstanding the provisions of this Section 8(d), no Initial
         Purchaser shall be required to contribute any amount in excess of the
         amount by which the total price at which the Notes purchased by it was
         resold to Eligible Purchasers


                                                                              27


         exceeds the amount of any damages which such Initial Purchaser has
         otherwise paid or become liable to pay by reason of any untrue or
         alleged untrue statement or omission or alleged omission. No person
         guilty of fraudulent misrepresentation (within the meaning of Section
         11(f) of the Securities Act) shall be entitled to contribution from any
         person who was not guilty of such fraudulent misrepresentation. The
         Initial Purchasers' obligations to contribute as provided in this
         Section 8(d) are several in proportion to their respective Purchase
         obligations and not joint.

                  (e) The Initial Purchasers severally confirm and the Company
         and the Subsidiary Guarantors acknowledge that the last sentence on the
         cover page of the Offering Memorandum, and the first sentence of the
         fifth, sixth, seventh and ninth paragraphs, the second sentence of the
         seventh paragraph, the sixth sentence of the tenth paragraph and the
         eleventh paragraph under the section entitled "Plan of Distribution" in
         the Offering Memorandum constitute the only information concerning the
         Initial Purchasers furnished in writing to the Company by or on behalf
         of the Initial Purchasers specifically for inclusion in the Offering
         Memorandum.

                  SECTION 9. Defaulting Initial Purchasers.

                  If, on the Closing Date, any Initial Purchaser defaults in the
performance of its obligations under this Agreement, the remaining
non-defaulting Initial Purchasers shall be obligated to purchase the Notes that
the defaulting Initial Purchaser agreed but failed to purchase on such Closing
Date in the respective proportions which the amount of the Notes set forth
opposite the name of each remaining non-defaulting Initial Purchaser in Schedule
1 hereto bears to the total amount of Notes set forth opposite the names of all
the remaining non-defaulting Initial Purchasers in Schedule 1 hereto; provided,
however, that the remaining non-defaulting Initial Purchasers shall not be
obligated to purchase any of the Notes on such Closing Date if the total amount
of the Notes which the defaulting Initial Purchaser or Initial Purchasers agreed
but failed to purchase on such date exceeds 10% of the total amount of Notes to
be purchased on such Closing Date, and any remaining non-defaulting Initial
Purchaser shall not be obligated to purchase more than 110% of the amount of
Notes which it agreed to purchase on such Closing Date pursuant to the terms of
Section 2. If the foregoing maximums are exceeded, the remaining non-defaulting
Initial Purchasers, or those other Initial Purchasers satisfactory to Lehman
Brothers who so agree, shall have the right, but shall not be obligated, to
purchase, in such proportion as may be agreed upon among them, all of the Notes
to be purchased on such Closing Date. If the remaining Initial Purchasers or
other Initial Purchasers satisfactory to Lehman Brothers do not elect to
purchase the Notes which the defaulting Initial Purchaser or Initial Purchasers
agreed but failed to purchase on such Closing Date, this Agreement shall
terminate without liability on the part of any non-defaulting Initial Purchaser
or the Company, except that the Company will continue to be liable for the
payment of expenses to the extent set forth in Sections 6 and 11. As used in
this Agreement, the term "INITIAL PURCHASER" includes, for all purposes of this
Agreement unless the context requires otherwise, any party not listed in
Schedule 1 hereto who, pursuant to this Section 9, purchases the Notes which a
defaulting Initial Purchaser agreed but failed to purchase.

                  Nothing contained herein shall relieve a defaulting Initial
Purchaser of any liability it may have to the Company and the Subsidiary
Guarantors for damages caused by its


                                                                              28


default. If other Initial Purchasers are obligated or agree to purchase the
Notes of a defaulting or withdrawing Initial Purchaser, either the Lehman
Brothers or the Company may postpone the Closing Date for up to seven full
business days in order to effect any changes that in the opinion of counsel for
the Company or counsel for the Initial Purchasers may be necessary in the
Offering Memorandum or in any other document or arrangement.

                  SECTION 10. Termination. The obligations of the Initial
Purchasers hereunder may be terminated by Lehman Brothers by notice given to and
received by the Company prior to delivery of and payment for the Notes if, prior
to that time, any of the events described in Sections 7(o), 7(p) and 7(q) shall
have occurred or if the Initial Purchasers shall decline to purchase the Notes
for any reason permitted under this Agreement.

                  SECTION 11. Reimbursement of Initial Purchasers' Expenses. If
the Company and the Subsidiary Guarantors shall fail to deliver the Notes and
the Guarantees to the Initial Purchasers by reason of any failure, refusal or
inability on the part of the Company and the Subsidiary Guarantors to perform
any agreement on its part to be performed, or because any other condition of the
Initial Purchasers' obligations hereunder required to be fulfilled by the
Company and the Subsidiary Guarantors is not fulfilled, the Company and the
Subsidiary Guarantors will reimburse the Initial Purchasers for all reasonable
out-of-pocket expenses (including reasonable fees and disbursements of counsel)
incurred by the Initial Purchasers in connection with this Agreement and the
proposed purchase of the Notes and the Guarantees, and upon demand the Company
and the Subsidiary Guarantors shall pay the full amount thereof to Lehman
Brothers.

                  SECTION 12. Notices, etc. All statements, requests, notices
and agreements hereunder shall be in writing, and:

                  (a) if to the Initial Purchasers, shall be delivered or sent
         by mail, telex or facsimile transmission to the care of Lehman Brothers
         Inc., 745 Seventh Avenue, 19th Floor, Attention: Michael Konigsburg
         (Fax: (646) 758-4247), with a copy to Weil, Gotshal & Manges LLP, 767
         Fifth Avenue, New York, New York 10153, Attention: Rod Miller, Esq.
         (Fax: 212-310-8007) and, in the case of any notice pursuant to Section
         8(d), to the Director of Litigation, Office of the General Counsel,
         Lehman Brothers Inc., 399 Park Avenue, New York, New York (Fax: (212)
         526-2648);

                  (b) if to the Company and the Subsidiary Guarantors, shall be
         delivered or sent by mail, telex or facsimile transmission to the
         Company, 111 West Michigan Street, Milwaukee, Wisconsin 53203-290,
         Attention: Melvin A. Rhinelander, (Fax: (414) 908-8111), with a copy to
         Foley & Lardner, 777 East Wisconsin Avenue, Milwaukee, Wisconsin
         53202-5367, Attention: Russell E. Ryba, Esq. (Fax: (414) 297-4900);

provided, however, that any notice to an Initial Purchaser pursuant to Section
8(d) shall be delivered or sent by mail, telex or facsimile transmission to such
Initial Purchaser at its address set forth in its acceptance telex to Lehman
Brothers, which address will be supplied to any other party hereto by Lehman
Brothers upon request. Any such statements, requests, notices or agreements
shall take effect at the time of receipt thereof. The Company shall be entitled
to act


                                                                              29


and rely upon any request, consent, notice or agreement given or made on behalf
of the Initial Purchasers by Lehman Brothers.

                  SECTION 13. Persons Entitled to Benefit of Agreement. This
Agreement shall inure to the benefit of and be binding upon the Initial
Purchasers, the Company, the Subsidiary Guarantors and their respective personal
representatives and successors. This Agreement and the terms and provisions
hereof are for the sole benefit of only those persons, except that (a) the
representations, warranties, indemnities and agreements of the Company and the
Subsidiary Guarantors contained in this Agreement shall also be deemed to be for
the benefit of the directors, officers, employees of the Initial Purchasers and
each person or persons, if any, who control any Initial Purchasers within the
meaning of Section 15 of the Securities Act and (b) the indemnity agreement of
the Initial Purchasers contained in Section 8(b) of this Agreement shall be
deemed to be for the benefit of directors, officers and any person controlling
the Company and the Subsidiary Guarantors within the meaning of Section 15 of
the Securities Act. Nothing in this Agreement is intended or shall be construed
to give any person, other than the persons referred to in this Section 13, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision contained herein.

                  SECTION 14. Survival. The respective indemnities,
representations, warranties and agreements of the Company, the Subsidiary
Guarantors and the Initial Purchasers contained in this Agreement or made by or
on behalf on them, respectively, pursuant to this Agreement, shall survive the
delivery of and payment for the Notes and the Guarantees and shall remain in
full force and effect, regardless of any investigation made by or on behalf of
any of them or any person controlling any of them.

                  SECTION 15. Definition of the Term "Business Day." For
purposes of this Agreement, "BUSINESS DAY" means each Monday, Tuesday,
Wednesday, Thursday or Friday which is not a day on which banking institutions
in New York are generally authorized or obligated by law or executive order to
close.

                  SECTION 16. Jurisdiction. Each of the parties hereto
irrevocably consents to the jurisdiction of the courts of the State of New York
and the courts of the United States of America located in the Borough of
Manhattan, City and State of New York, over any suit, action or proceeding with
respect to this Agreement or the transactions contemplated hereby. Each of the
parties hereto waives any objection that it may have to the venue of any suit,
action or proceeding with respect to this Agreement or the transactions
contemplated hereby in the courts of the State of New York or the courts of the
United States of America, in each case, located in the Borough of Manhattan,
City and State of New York or that such suit, action or proceeding brought in
the courts of the State of New York or United States of America, in each case,
located in the Borough of Manhattan, City and State of New York was brought in
an inconvenient court and agrees not to plead or claim the same.

                  SECTION 17. Governing Law. This Agreement shall be governed by
and construed in accordance with the internal laws of the State of New York.



                                                                              30


                  SECTION 18. Counterparts. This Agreement may be executed in
multiple counterparts and, if executed in counterparts, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.

                  SECTION 19. Headings. The headings herein are inserted for
convenience of reference only and are not intended to be part of, or to affect
the meaning or interpretation of, this Agreement.

            [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK]







                                                                              31


                  If the foregoing correctly sets forth the agreement among the
Company, the Subsidiary Guarantors and the Initial Purchasers, please indicate
your acceptance in the space provided for that purpose below.

                                    Very truly yours,


                                    EXTENDICARE HEALTH SERVICES, INC.


                                    By: /s/ Mark W. Durishan
                                       -----------------------------------------
                                    Name: Mark W. Durishan
                                    Title: Vice President - Finance


                                    EXTENDICARE HEALTH FACILITY HOLDINGS, INC.
                                    EXTENDICARE HEALTH FACILITIES, INC.
                                    COVENTRY CARE, INC.
                                    NORTHERN HEALTH FACILITIES, INC.
                                    EXTENDICARE HOMES, INC.
                                    EXTENDICARE HEALTH NETWORK, INC.
                                    THE PROGRESSIVE STEP CORPORATION
                                    EXTENDICARE OF INDIANA, INC.
                                    EDGEWOOD NURSING CENTER, INC.
                                    ELDER CREST, INC.
                                    HAVEN CREST, INC.
                                    MEADOW CREST, INC.
                                    OAK HILL HOME OF REST AND CARE, INC.
                                    EXTENDICARE GREAT TRAIL, INC.
                                    FIR LANE TERRACE CONVALESCENT CENTER, INC.
                                    ADULT SERVICES UNLIMITED, INC.
                                    ARBORS EAST, INC.
                                    ARBORS AT TOLEDO, INC.
                                    HEALTH POCONOS, INC.
                                    MARSHALL PROPERTIES, INC.
                                    COVENTRY CARE HOLDINGS, INC.
                                    UNITED PROFESSIONAL SERVICES, INC.

                                    By: /s/ Mark W. Durishan
                                       -----------------------------------------
                                    Name:  Mark W. Durishan
                                    Title: Vice President - Finance




                                            SIGNATURE PAGE TO PURCHASE AGREEMENT



                                    INDIANA HEALTH AND REHABILITATION
                                        PARTNERSHIP

                                    BY: EXTENDICARE HOMES, INC., AS GENERAL
                                        PARTNER


                                    By: /s/ Mark W. Durishan
                                       -----------------------------------------
                                    Name:  Mark W. Durishan
                                    Title: Vice President - Finance

                                    BY: EXTENDICARE OF INDIANA, INC., AS
                                        GENERAL PARTNER


                                    By: /s/ Mark W. Durishan
                                       -----------------------------------------
                                    Name:  Mark W. Durishan
                                    Title: Vice President - Finance


                                    CONCORDIA MANOR, LLC
                                    FIRST COAST HEALTH AND REHABILITATION
                                        CENTER, LLC
                                    JACKSON HEIGHTS REHABILITATION CENTER, LLC
                                    TREASURE ISLE CARE CENTER, LLC

                                    BY: EXTENDICARE HOMES, INC., AS SOLE MEMBER


                                    By: /s/ Mark W. Durishan
                                       -----------------------------------------
                                    Name:  Mark W. Durishan
                                    Title: Vice President - Finance


                                    KAUFMAN STREET, WV, LLC
                                    NEW CASTLE CARE, LLC

                                    BY: FIR LANE TERRACE CONVALESCENT CENTER,
                                        INC., AS SOLE MEMBER


                                    By: /s/ Mark W. Durishan
                                       -----------------------------------------
                                    Name:  Mark W. Durishan
                                    Title: Vice President - Finance


                                            SIGNATURE PAGE TO PURCHASE AGREEMENT


                                    ALPINE HEALTH AND REHABILITATION CENTER, LLC
                                    COLONIAL CARE, LLC
                                    GREENBRIAR CARE, LLC
                                    GREENBROOK CARE, LLC
                                    HERITAGE CARE, LLC
                                    LADY LAKE CARE, LLC
                                    NEW HORIZON CARE, LLC
                                    NORTH REHABILITATION CARE, LLC
                                    PALM COURT CARE, LLC
                                    RICHEY MANOR, LLC
                                    ROCKLEDGE CARE, LLC
                                    SOUTH HERITAGE HEALTH AND REHABILITATION
                                        CENTER, LLC
                                    THE OAKS RESIDENTIAL AND REHABILITATION
                                        CENTER, LLC
                                    WINTER HAVEN HEALTH AND REHABILITATION
                                        CENTER, LLC

                                    BY: EXTENDICARE HEALTH FACILITIES, INC., AS
                                        SOLE MEMBER


                                    By: /s/ Mark W. Durishan
                                       -----------------------------------------
                                    Name:  Mark W. Durishan
                                    Title: Vice President - Finance


                                    ARBORS AT TAMPA, LLC ARBORS
                                    AT BAYONET POINT, LLC
                                    ARBORS AT FAIRLAWN CARE, LLC
                                    ARBORS AT FAIRLAWN REALTY OH, LLC
                                    ARBORS AT SYLVANIA CARE, LLC
                                    ARBORS AT SYLVANIA REALTY OH, LLC
                                    ARBORS WEST CARE, LLC
                                    ARBORS WEST REALTY OH, LLC
                                    COLUMBUS REHABILITATION REALTY OH, LLC
                                    JACKSONVILLE CARE, LLC
                                    SAFETY HARBOR CARE, LLC
                                    KISSIMMEE CARE, LLC
                                    ORANGE PARK CARE, LLC
                                    OREGON CARE, LLC
                                    PORT CHARLOTTE CARE, LLC
                                    SARASOTA CARE, LLC
                                    SEMINOLE CARE, LLC
                                    WINTER HAVEN CARE, LLC


                                            SIGNATURE PAGE TO PURCHASE AGREEMENT


                                    BLANCHESTER CARE, LLC
                                    CANTON CARE, LLC
                                    COLUMBUS REHABILITATION CARE, LLC
                                    DAYTON CARE, LLC
                                    DELAWARE CARE, LLC
                                    GALLIPOLIS CARE, LLC
                                    HILLIARD CARE, LLC
                                    LONDON CARE, LLC
                                    MARIETTA CARE, LLC
                                    ROCKMILL CARE, LLC
                                    ROCKSPRINGS CARE, LLC
                                    WATERVILLE CARE, LLC
                                    WOODSFIELD CARE, LLC

                                    BY: NORTHERN HEALTH FACILITIES, INC., AS
                                        SOLE MEMBER


                                    By: /s/ Mark W. Durishan
                                       -----------------------------------------
                                    Name:  Mark W. Durishan
                                    Title: Vice President - Finance


                                    STONEBRIDGE CARE, LP
                                    EDGEWOOD CARE, LP
                                    ELDERCREST CARE, LP
                                    HAVEN CARE, LP
                                    MEADOW CARE, LP
                                    OAK HILL CARE, LP

                                    BY: COVENTRY CARE HOLDINGS, INC., AS GENERAL
                                        PARTNER


                                    By: /s/ Mark W. Durishan
                                       -----------------------------------------
                                    Name:  Mark W. Durishan
                                    Title: Vice President - Finance



                                            SIGNATURE PAGE TO PURCHASE AGREEMENT


                                    GREAT TRAIL CARE, LLC

                                    BY: EXTENDICARE GREAT TRAIL, INC., AS SOLE
                                        MEMBER


                                    By: /s/ Richard Bertrand
                                       -----------------------------------------
                                    Name:  Richard Bertrand
                                    Title: Senior Vice President - Development


                                    FISCAL SERVICES GROUP, LLC
                                    PARTNERS HEALTH GROUP, LLC

                                    BY: EXTENDICARE HEALTH NETWORK, INC., AS
                                        SOLE MEMBER


                                    By: /s/ Richard Bertrand
                                       -----------------------------------------
                                    Name:  Richard Bertrand
                                    Title: Senior Vice President - Development


                                    MILFORD CARE, LLC

                                    BY: MARSHALL PROPERTIES, INC., AS SOLE
                                        MEMBER


                                    By: /s/ Richard Bertrand
                                       -----------------------------------------
                                    Name:  Richard Bertrand
                                    Title: Senior Vice President - Development



                                            SIGNATURE PAGE TO PURCHASE AGREEMENT


                                    PARTNERS HEALTH GROUP - FLORIDA, LLC
                                    PARTNERS HEALTH GROUP - LOUISIANA, LLC
                                    PARTNERS HEALTH GROUP - TEXAS, LLC

                                    BY: PARTNERS HEALTH GROUP, LLC

                                    BY: EXTENDICARE HEALTH NETWORK, INC., AS
                                        SOLE MEMBER


                                    By: /s/ Richard Bertrand
                                       -----------------------------------------
                                    Name:  Richard Bertrand
                                    Title: Senior Vice President - Development


















                                            SIGNATURE PAGE TO PURCHASE AGREEMENT


Accepted:

LEHMAN BROTHERS INC.

By: /s/ Mike Konigsberg
   ----------------------------------
     Authorized Representative


For itself and as representative
of the several Initial Purchasers named
in Schedule 1 hereto








                                            SIGNATURE PAGE TO PURCHASE AGREEMENT

EX-4.3

                                                               EXECUTION VERSION

                                                                     EXHIBIT 4.3

================================================================================









                       EXTENDICARE HEALTH SERVICES, INC.,
                                    as Issuer





                          9 1/2% SENIOR NOTES DUE 2010


                         ------------------------------


                                    INDENTURE


                            Dated as of June 28, 2002


                         ------------------------------


                                U.S. BANK, N.A.,
                                   as Trustee





================================================================================



                                TABLE OF CONTENTS



                                                                                                     PAGE


                                                                                               
ARTICLE 1.            DEFINITIONS AND INCORPORATION BY REFERENCE........................................1

         Section 1.01.     Definitions..................................................................1

         Section 1.02.     Other Definitions...........................................................17

         Section 1.03.     Incorporation by Reference of Trust Indenture Act...........................17

         Section 1.04.     Rules of Construction.......................................................18

ARTICLE 2.            THE NOTES........................................................................18

         Section 2.01.     Form and Dating.............................................................18

         Section 2.02.     Execution and Authentication................................................19

         Section 2.03.     Registrar and Paying Agent..................................................19

         Section 2.04.     Paying Agent to Hold Money in Trust.........................................20

         Section 2.05.     Holder Lists................................................................20

         Section 2.06.     Transfer and Exchange.......................................................20

         Section 2.07.     Replacement Notes...........................................................30

         Section 2.08.     Outstanding Notes...........................................................30

         Section 2.09.     Treasury Notes..............................................................30

         Section 2.10.     Temporary Notes.............................................................31

         Section 2.11.     Cancellation................................................................31

         Section 2.12.     Defaulted Interest..........................................................31

         Section 2.13.     CUSIP or ISIN Numbers.......................................................31

         Section 2.14.     Additional Interest.........................................................31

ARTICLE 3.            REDEMPTION AND PREPAYMENT........................................................32

         Section 3.01.     Notices to Trustee..........................................................32

         Section 3.02.     Selection of Notes to Be Redeemed...........................................32

         Section 3.03.     Notice of Redemption........................................................32

         Section 3.04.     Effect of Notice of Redemption..............................................33

         Section 3.05.     Deposit of Redemption Price.................................................33

         Section 3.06.     Notes Redeemed in Part......................................................33

         Section 3.07.     Optional Redemption.........................................................33

         Section 3.08.     Mandatory Redemption........................................................34

         Section 3.09.     Offer To Purchase by Application of Excess Proceeds.........................34

ARTICLE 4.            COVENANTS........................................................................35

         Section 4.01.     Payment of Notes............................................................35

         Section 4.02.     Maintenance of Office or Agency.............................................36

         Section 4.03.     Reports.....................................................................36

         Section 4.04.     Compliance Certificate......................................................37

         Section 4.05.     Taxes.......................................................................37



                                       i

                                TABLE OF CONTENTS



                                                                                                     PAGE


                                                                                               
         Section 4.06.     Stay, Extension and Usury Laws..............................................37

         Section 4.07.     Corporate Existence.........................................................38

         Section 4.08.     Payments for Consent........................................................38

         Section 4.09.     Incurrence of Indebtedness and Issuance of Preferred Stock..................38

         Section 4.10.     Restricted Payments.........................................................40

         Section 4.11.     Liens.......................................................................42

         Section 4.12.     Asset Sales.................................................................42

         Section 4.13.     Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries...43

         Section 4.14.     Transactions with Affiliates................................................44

         Section 4.15.     Sale and Leaseback Transactions.............................................45

         Section 4.16.     Issuances and Sales of Capital Stock of Restricted Subsidiaries.............46

         Section 4.17.     Designation of Restricted and Unrestricted Subsidiaries.....................46

         Section 4.18.     Repurchase at the Option of Holders Upon a Change of Control................46

         Section 4.19.     Additional Subsidiary Guarantees............................................48

         Section 4.20.     Designation as "Designated Senior Indebtedness".............................48

         Section 4.21.     Business Activities.........................................................48

ARTICLE 5.            SUCCESSORS.......................................................................48

         Section 5.01.     Merger, Consolidation, or Sale of Property..................................48

         Section 5.02.     Successor Corporation Substituted...........................................49

ARTICLE 6.            DEFAULTS AND REMEDIES............................................................49

         Section 6.01.     Events of Default...........................................................49

         Section 6.02.     Acceleration................................................................50

         Section 6.03.     Other Remedies..............................................................51

         Section 6.04.     Waiver of Past Defaults.....................................................51

         Section 6.05.     Control by Majority.........................................................51

         Section 6.06.     Limitation on Suits.........................................................52

         Section 6.07.     Rights of Holders to Receive Payment........................................52

         Section 6.08.     Collection Suit by Trustee..................................................52

         Section 6.09.     Trustee May File Proofs of Claim............................................52

         Section 6.10.     Priorities..................................................................53

         Section 6.11.     Undertaking for Costs.......................................................53

ARTICLE 7.            TRUSTEE..........................................................................53

         Section 7.01.     Duties of Trustee...........................................................53

         Section 7.02.     Rights of Trustee...........................................................54

         Section 7.03.     Individual Rights of Trustee................................................55



                                       ii



                                TABLE OF CONTENTS



                                                                                                     PAGE


                                                                                               
         Section 7.04.     Trustee's Disclaimer........................................................55

         Section 7.05.     Notice of Defaults..........................................................55

         Section 7.06.     Reports by Trustee to Holders...............................................55

         Section 7.07.     Compensation and Indemnity..................................................56

         Section 7.08.     Replacement of Trustee......................................................56

         Section 7.09.     Successor Trustee by Merger, etc............................................57

         Section 7.10.     Eligibility; Disqualification...............................................57

         Section 7.11.     Preferential Collection of Claims Against Company...........................57

ARTICLE 8.            LEGAL DEFEASANCE AND COVENANT DEFEASANCE.........................................57

         Section 8.01.     Option to Effect Legal Defeasance or Covenant Defeasance....................57

         Section 8.02.     Legal Defeasance and Discharge..............................................58

         Section 8.03.     Covenant Defeasance.........................................................58

         Section 8.04.     Conditions to Legal or Covenant Defeasance..................................58

         Section 8.05.     Deposited Money and Government Securities to be Held in Trust;
                           Other Miscellaneous Provisions..............................................59

         Section 8.06.     Repayment to Company........................................................60

         Section 8.07.     Reinstatement...............................................................60

ARTICLE 9.            AMENDMENT, SUPPLEMENT AND WAIVER.................................................60

         Section 9.01.     Without Consent of Holders of Notes.........................................60

         Section 9.02.     With Consent of Holders of Notes............................................61

         Section 9.03.     Compliance with Trust Indenture Act.........................................62

         Section 9.04.     Revocation and Effect of Consents...........................................62

         Section 9.05.     Notation on or Exchange of Notes............................................62

         Section 9.06.     Trustee to Sign Amendments, etc.............................................62

ARTICLE 10.           SUBSIDIARY GUARANTEES............................................................63

         Section 10.01.    Guarantee...................................................................63

         Section 10.02.    Limitation on Subsidiary Guarantor Liability................................64

         Section 10.03.    Execution and Delivery of Subsidiary Guarantee..............................64

         Section 10.04.    Subsidiary Guarantors May Consolidate, etc., on Certain Terms...............65

         Section 10.05.    Releases Following Sale of Assets...........................................65

ARTICLE 11.           SATISFACTION AND DISCHARGE.......................................................66

         Section 11.01.    Satisfaction and Discharge..................................................66

         Section 11.02.    Deposited Money and Government Securities to be Held in Trust;
                           Other Miscellaneous Provisions..............................................66

         Section 11.03.    Repayment to Company........................................................66

ARTICLE 12.           MISCELLANEOUS....................................................................67

         Section 12.01.    Trust Indenture Act Controls................................................67



                                      iii


                                TABLE OF CONTENTS



                                                                                                     PAGE


                                                                                               
         Section 12.02.    Notices.....................................................................67

         Section 12.03.    Communication by Holders of Notes with Other Holders of Notes...............68

         Section 12.04.    Certificate and Opinion as to Conditions Precedent..........................68

         Section 12.05.    Statements Required in Certificate or Opinion...............................68

         Section 12.06.    Rules by Trustee and Agents.................................................68

         Section 12.07.    No Personal Liability of Directors, Officers, Employees and Stockholders....69

         Section 12.08.    Governing Law...............................................................69

         Section 12.09.    No Adverse Interpretation of Other Agreements...............................69

         Section 12.10.    Successors..................................................................69

         Section 12.11.    Severability................................................................69

         Section 12.12.    Counterpart Originals.......................................................69

         Section 12.13.    Table of Contents, Headings, etc............................................69






                                       iv



                                TABLE OF CONTENTS



                                                                                                     PAGE


                                                                                               
EXHIBITS

                  Exhibit A         FORM OF NOTE......................................................A-1
                  Exhibit B         FORM OF CERTIFICATE OF TRANSFER...................................B-1
                  Exhibit C         FORM OF CERTIFICATE OF EXCHANGE...................................C-1
                  Exhibit D         FORM OF CERTIFICATE FROM ACQUIRING
                                    INSTITUTIONAL ACCREDITED INVESTOR.................................D-1
                  Exhibit E         FORM OF NOTATION OF GUARANTEE.....................................E-1





                                       v




                                                               EXECUTION VERSION


                  This INDENTURE dated as of June 28, 2002, is by and among
Extendicare Health Services, Inc., a Delaware corporation (the "Company"), the
Subsidiary Guarantors listed on the signature pages hereto, and U.S. Bank, N.A.,
as trustee (the "Trustee").

                  The Company, the Subsidiary Guarantors and the Trustee agree
as follows for the benefit of each other and for the equal and ratable benefit
of the Holders of the 9 1/2% Senior Notes due 2010 (the "Notes"):

                                   ARTICLE 1.

                   DEFINITIONS AND INCORPORATION BY REFERENCE

Section 1.01.     DEFINITIONS.
                  -----------

                  For all purposes of this Indenture, except as otherwise
expressly provided or unless the context otherwise requires:

                  "144A Global Note" means the global note in the form of
Exhibit A hereto bearing the Global Note Legend and the Private Placement Legend
and deposited with and registered in the name of the Depositary or its nominee
that will be issued in a denomination equal to the outstanding principal amount
of the Notes sold in reliance on Rule 144A.

                  "Acquired Debt" means, with respect to any specified Person:

                  (1) Indebtedness of any other Person existing at the time such
other Person is merged with or into or became a Subsidiary of such specified
Person, whether or not such Indebtedness is incurred in connection with, or in
contemplation of, such other Person merging with or into, or becoming a
Subsidiary of, such specified Person; and

                  (2) Indebtedness secured by a Lien encumbering any asset
acquired by such specified Person.

                  "Additional Interest" shall have the meaning set forth in the
Registration Rights Agreement.

                  "Additional Notes" means any Notes (other than Initial Notes
and Exchange Notes) issued under this Indenture in accordance with Sections 2.02
and 4.09 hereof, as part of the same series as the Initial Notes.

                  "Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For purposes of this definition,
"control," as used with respect to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; provided that beneficial ownership of 10% or more of the
Voting Stock of a Person will be deemed to be control. For purposes of this
definition, the terms "controlling," "controlled by" and "under common control
with" have correlative meanings.

                  "Agent" means any Registrar, co-registrar, Paying Agent or
additional paying agent.

                  "Applicable Procedures" means, with respect to any transfer,
redemption or exchange of or for beneficial interests in any Global Note, the
rules and procedures of the Depositary, Euroclear and Clearstream that apply to
such transfer, redemption or exchange.

                  "Asset Sale" means the sale, lease, conveyance or other
disposition of any assets or rights (including, without limitation, (x) a sale
and leaseback, (y) the issuance, sale or other transfer of any Equity Interests
in any of our Unrestricted Subsidiaries, and (z) the receipt of proceeds of
insurance paid on account of the loss of or damage to any asset and awards of
compensation for any asset taken by condemnation, eminent domain or similar
proceeding, and including the receipt of proceeds of business interruption
insurance) in each case, in one or a series of related transactions that have a
fair market value in excess of $1.0 million or for Net Proceeds in excess of
$1.0








million; provided that the sale, conveyance or other disposition of all or
substantially all of the assets of the Company and its Restricted Subsidiaries
taken as a whole will be governed by Section 4.18 and/or Section 5.01 and not by
Section 4.12.

                  Notwithstanding the preceding, the following items will not be
deemed to be Asset Sales:

                  (1)     the sale, lease or other disposition of equipment,
inventory, accounts receivable or other assets or rights in the ordinary course
of business;

                  (2)     a transfer of assets or rights by the Company to a
Subsidiary Guarantor, or by a Subsidiary Guarantor to the Company or to another
Subsidiary Guarantor;

                  (3)     an issuance of Equity Interests by a Subsidiary
Guarantor to the Company or to another Subsidiary Guarantor;

                  (4)     a Restricted Payment or Permitted Investment that is
permitted by Section 4.10;

                  (5)     the sale of property or equipment that has become worn
out, obsolete or damaged;

                  (6)     the sale or other disposition of Cash Equivalents;

                  (7)     the sale of accounts receivable pursuant to a
Securitization Transaction; or

                  (8)     the designation of any Restricted Subsidiary as an
Unrestricted Subsidiary or the contribution to the capital of any Unrestricted
Subsidiary in accordance with the provisions described under Section 4.17.

                  "Attributable Debt" in respect of a sale and leaseback
transaction means, at the time of determination, the greater of (a) the fair
value of the property subject to such arrangement (as determined in good faith
by the Board of Directors of the Company) or (b) the present value (discounted
at the interest rate borne by the Notes, compounded annually) of the total
obligations of the lessee for rental payments during the remaining term of the
lease included in such sale and leaseback transaction, including any period for
which such lease has been extended or may, at the option of the lessor, be
extended.

                  "Bankruptcy Law" means Title 11, U.S. Code or any similar
federal, state or foreign law for the relief of debtors.

                  "Board of Directors" means:

                  (1) with respect to a corporation, the board of directors of
the corporation;

                  (2) with respect to a partnership, the board of directors of
the general partner of the partnership; and

                  (3) with respect to any other Person, the board or committee
of such Person serving a similar function.

                  "Board Resolution" means a copy of a resolution certified by
the Secretary or an Assistant Secretary of the applicable Person to have been
duly adopted by the Board of Directors of such Person and to be in full force
and effect on the date of such certification, and delivered to the Trustee.

                  "Business Day" means any day other than a Legal Holiday.


                                        2



                  "Capital Lease Obligation" means, at the time any
determination is to be made, the amount of the liability in respect of a capital
lease that would at that time be required to be capitalized on a balance sheet
in accordance with GAAP.

                  "Capital Stock" means:

                  (1) in the case of a corporation, any and all shares,
including common stock and preferred stock;

                  (2) in the case of an association or business entity, any and
all shares, interests, participations, rights or other equivalents (however
designated) of corporate stock;

                  (3) in the case of a partnership or limited liability company,
partnership or membership interests (whether general or limited); and

                  (4) any other interest or participation that confers on a
Person the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person.

                  "Cash Equivalents" means:

                  (1) United States dollars;

                  (2) securities issued or directly and fully guaranteed or
insured by the United States government or any agency or instrumentality of the
United States government (provided that the full faith and credit of the United
States is pledged in support of those securities) having maturities of not more
than six months from the date of acquisition;

                  (3) certificates of deposit and eurodollar time deposits with
maturities of six months or less from the date of acquisition, bankers'
acceptances with maturities not exceeding six months and overnight bank
deposits, in each case, with any lender party to the Credit Agreement or with
any domestic commercial bank having capital and surplus in excess of $500.0
million and a Thomson Bank Watch Rating of "B" or better;

                  (4) repurchase obligations with a term of not more than seven
days for underlying securities of the types described in clauses (2) and (3)
above entered into with any financial institution meeting the qualifications
specified in clause (3) above;

                  (5) commercial paper having the highest rating obtainable from
Moody's Investors Service, Inc. or Standard & Poor's Rating Services and in each
case maturing within six months after the date of acquisition; and

                  (6) money market funds at least 95% of the assets of which
constitute Cash Equivalents of the kinds described in clauses (1) through (5) of
this definition.

                  "Change of Control" means the occurrence of any of the
following:

                  (1) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all or substantially all of
the assets of the Company to any Person or group of related Persons for purposes
of Section 13(d) of the Exchange Act (a "Group"), together with any Affiliates
thereof (whether or not otherwise in compliance with the provisions of this
Indenture);

                  (2) the approval by the holders of Capital Stock of the
Company of any plan or proposal for the liquidation or dissolution of the
Company (whether or not otherwise in compliance with the provisions of this
Indenture);



                                       3


                  (3) any Person or Group (other than Parent or any direct or
indirect wholly owned Subsidiary of Parent) becomes the owner, directly or
indirectly, beneficially or of record, of shares representing more than 35% of
the aggregate ordinary voting power represented by the issued and outstanding
Capital Stock of the Company on a fully-diluted basis;

                  (4) the replacement of a majority of the Board of Directors of
Parent or the Company over a two-year period from the directors who constituted
the Board of Directors of Parent or the Company, as applicable, at the beginning
of such period, and such replacement shall not have been approved by a vote of
at least a majority of the Board of Directors of Parent or the Company, as
applicable, then still in office who either were members of such Board of
Directors at the beginning of such period or whose election as a member of such
Board of Directors was previously so approved; or

                  (5) the Company consolidates with, or merges with or into, any
Person, or any Person consolidates with, or merges with or into, the Company, in
any such event pursuant to a transaction in which any of the Company's
outstanding Voting Stock or the outstanding Voting Stock of such other Person is
converted into or exchanged for cash, securities or other property, other than
any such transaction where the Company's Voting Stock outstanding immediately
prior to such transaction is converted into or exchanged for Voting Stock (other
than Disqualified Stock) of the surviving or transferee Person constituting a
majority of the outstanding shares of such Voting Stock of such surviving or
transferee Person (immediately after giving effect to such issuance).

                  "Clearstream" means Clearstream Banking S.A. and any successor
thereto.

                  "Code" means the Internal Revenue Code of 1986, as amended.

                  "Consolidated Cash Flow" means, with respect to any specified
Person for any period, the Consolidated Net Income of such Person for such
period plus:

                  (1) an amount equal to any extraordinary loss plus any net
loss realized by such Person or any of its Subsidiaries in connection with an
Asset Sale, to the extent such losses were deducted in computing such
Consolidated Net Income; plus

                  (2) provision for taxes based on income or profits of such
Person and its Restricted Subsidiaries for such period, to the extent that such
provision for taxes was deducted in computing such Consolidated Net Income; plus

                  (3) consolidated interest expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued and whether or
not capitalized (including, without limitation, amortization of debt issuance
costs and original issue discount, non-cash interest payments, the interest
component of any deferred payment obligations, the interest component of all
payments associated with Capital Lease Obligations, imputed interest with
respect to Attributable Debt, commissions, discounts and other fees and charges
incurred in respect of letter of credit or bankers' acceptance financings, and
net of the effect of all payments made or received pursuant to Hedging
Obligations), to the extent that any such expense was deducted in computing such
Consolidated Net Income; plus

                  (4) depreciation, amortization (including amortization of
goodwill and other intangibles but excluding amortization of prepaid cash
expenses that were paid in a prior period) and other non-cash expenses
(excluding any such non-cash expense to the extent that it represents an accrual
of or reserve for cash expenses in any future period) of such Person and its
Restricted Subsidiaries for such period to the extent that such depreciation,
amortization and other non-cash expenses were deducted in computing such
Consolidated Net Income; minus

                  (5) non-cash items increasing such Consolidated Net Income for
such period, other than the accrual of revenue in the ordinary course of
business,

in each case, on a consolidated basis and determined in accordance with GAAP.




                                       4



                  "Consolidated Net Income" means, with respect to any specified
Person for any period, the aggregate of the Net Income of such Person and its
Restricted Subsidiaries for such period, on a consolidated basis, determined in
accordance with GAAP; provided that:

                  (1) the Net Income (but not loss) of any Person that is not a
Restricted Subsidiary or that is accounted for by the equity method of
accounting will be included only to the extent of the amount of dividends or
distributions paid in cash to the specified Person or a Restricted Subsidiary of
the Person;

                  (2) the Net Income of any Restricted Subsidiary will be
excluded to the extent that the declaration or payment of dividends or similar
distributions by that Restricted Subsidiary of that Net Income is not at the
date of determination permitted without any prior governmental approval (that
has not been obtained) or, directly or indirectly, by operation of the terms of
its charter or any agreement, instrument, judgment, decree, order, statute, rule
or governmental regulation applicable to that Restricted Subsidiary or its
stockholders; and

                  (3) the cumulative effect of a change in accounting principles
will be excluded.

                  "Corporate Trust Office of the Trustee" shall be at the
address of the Trustee specified in Section 12.02 hereof or such other address
as to which the Trustee may give notice to the Company.

                  "Consolidated Senior Debt Leverage Ratio" means the ratio of
(1) consolidated Indebtedness of the Company and its Restricted Subsidiaries
(other than Subordinated Indebtedness) as of the date of the transaction giving
rise to the need to calculate such Consolidated Senior Debt Leverage Ratio to
(2) Consolidated Cash Flow for the four full fiscal quarters immediately
preceding the date of the transaction giving rise to the need to calculate such
Consolidated Senior Debt Leverage Ratio taken as one period.

                  "Consolidated Tangible Assets" means the total assets, less
goodwill and other intangibles, shown on the Company's most recent consolidated
balance sheet, determined on a consolidated basis in accordance with GAAP less
all write-ups (other than write-ups in connection with acquisitions) subsequent
to the date of this Indenture in the book value of any asset (except any such
intangible assets) owned by the Company or any of its Restricted Subsidiaries.

                  "Credit Agreement" means that certain Credit Agreement, dated
as of the date hereof, by and among Extendicare Holdings, Inc., the Company,
Lehman Commercial Paper Inc., as administrative agent, and the lenders party
thereto, including any related notes, guarantees, security and collateral
documents, instruments and agreements executed in connection therewith.

                  "Credit Facilities" means one or more debt facilities or
agreements (including, without limitation, the Credit Agreement) or commercial
paper facilities, in each case with banks or other lenders providing for
revolving credit loans, term loans, notes, receivables financing (including
through the sale of receivables to such lenders or to special purpose entities
formed to borrow from such lenders against such receivables) or letters of
credit, in each case, as amended, restated, modified, renewed, refunded,
replaced, restructured, restated or refinanced (including any agreement to
extend the maturity thereof and adding additional borrowers or guarantors) in
whole or in part from time to time under the same or any other agent, lender or
group of lenders and including increasing the amount of available borrowings
thereunder; provided that such increase is permitted by Section 4.09.

                  "Custodian" means, with respect to the Notes issuable or
issued in whole or in part in global form, the Person specified in Section 2.03
hereof as Custodian with respect to the Notes, any and all successors thereto
appointed as custodian hereunder and having become such pursuant to the
applicable provisions of this Indenture.

                  "Default" means any event that is, or with the passage of time
or the giving of notice or both would be, an Event of Default.

                  "Definitive Note" means a certificated Note registered in the
name of the Holder thereof and issued in accordance with Section 2.06 hereof, in
substantially the form of Exhibit A hereto except that such Note





                                       5



shall not bear the Global Note Legend and shall not have the "Schedule of
Exchanges of Interests in the Global Note" attached thereto.

                  "Designated Non-Cash Consideration" means the fair market
value of total consideration received by the Company or any of its Restricted
Subsidiaries in connection with an Asset Sale that is so designated as
Designated Non-Cash Consideration pursuant to an Officers' Certificate, setting
forth the basis of such valuation, executed by the Company's principal executive
officer and principal financial officer, less the amount of cash or Cash
Equivalents received in connection with the Asset Sale; provided, however, that
the total amount of Designated Non-Cash Consideration outstanding at any one
time does not exceed the greater of $15.0 million and 2.5% of Consolidated
Tangible Assets.

                  "Depositary" means, with respect to the Notes issuable or
issued in whole or in part in global form, the Person specified in Section 2.03
hereof as the Depositary with respect to the Notes, and any and all successors
thereto appointed as depositary hereunder and having become such pursuant to the
applicable provisions of this Indenture.

                  "Disqualified Stock" means any Capital Stock that, by its
terms (or by the terms of any security into which it is convertible, or for
which it is exchangeable, in each case at the option of the holder of the
Capital Stock), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at
the option of the holder of the Capital Stock, in whole or in part, on or prior
to the date that is 91 days after the date on which the Notes mature.
Notwithstanding the preceding sentence, any Capital Stock that would constitute
Disqualified Stock solely because the holders of the Capital Stock have the
right to require the Company to repurchase such Capital Stock upon the
occurrence of a Change of Control or an Asset Sale will not constitute
Disqualified Stock if the terms of such Capital Stock provide that the Company
may not repurchase or redeem any such Capital Stock pursuant to such provisions
unless such repurchase or redemption complies with Section 4.10.

                  "Distribution Compliance Period" means the 40-day distribution
compliance period as defined in Regulation S.

                  "Domestic Subsidiary" means any Restricted Subsidiary of the
Company that was formed under the laws of the United States or any state of the
United States or the District of Columbia.

                  "Equity Interests" means Capital Stock and all warrants,
options or other rights to acquire Capital Stock (but excluding any debt
security that is convertible into, or exchangeable for, Capital Stock).

                  "Euroclear" means Euroclear Bank, S.A./N.V., as operator of
the Euroclear systems, and any successor thereto.

                  "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

                  "Exchange Notes" means Notes issued in the Exchange Offer
pursuant to Section 2.06(f) hereof.

                  "Exchange Offer" has the meaning set forth in the Registration
Rights Agreement.

                  "Exchange Offer Registration Statement" has the meaning set
forth in the Registration Rights Agreement.

                  "Existing Indebtedness" means Indebtedness of the Company and
its Subsidiaries (other than Indebtedness under the Credit Agreement) in
existence on the date of this Indenture, until such amounts are repaid.

                  "Fixed Charge Coverage Ratio" means with respect to any
specified Person for any period, the ratio of the Consolidated Cash Flow of such
Person and its Restricted Subsidiaries for such period to the Fixed Charges of
such Person and its Restricted Subsidiaries for such period. In the event that
the specified Person or any of its Restricted Subsidiaries incurs, assumes,
Guarantees, repays, repurchases or redeems any Indebtedness (other


                                       6




than ordinary working capital borrowings) or issues, repurchases or redeems
preferred stock subsequent to the commencement of the reference period for which
the Fixed Charge Coverage Ratio is being calculated and on or prior to the date
on which the event for which the calculation of the Fixed Charge Coverage Ratio
is made (the "Calculation Date"), then the Fixed Charge Coverage Ratio will be
calculated giving pro forma effect to such incurrence, assumption, Guarantee,
repayment, repurchase or redemption of Indebtedness, or such issuance,
repurchase or redemption of preferred stock and the use of the proceeds
therefrom, as if the same had occurred at the beginning of the applicable
four-quarter reference period; provided, however, that the Fixed Charges of such
Person attributable to interest on any Indebtedness under a revolving credit
facility computed on a pro forma basis will be computed based on the average
daily balance of such Indebtedness during the four-quarter reference period and
using the interest rate in effect at the end of such period.

                  In addition, for purposes of calculating the Fixed Charge
Coverage Ratio:

                  (1) acquisitions that have been made by the specified Person
or any of its Restricted Subsidiaries, including through mergers or
consolidations and including any related financing transactions, during the
four-quarter reference period or subsequent to such reference period and on or
prior to the Calculation Date will be given pro forma effect (calculated in
accordance with Regulation S-X) as if they had occurred on the first day of the
four-quarter reference period and Consolidated Cash Flow for such reference
period will be calculated without giving effect to clause (3) of the proviso set
forth in the definition of Consolidated Net Income;

                  (2) the Consolidated Cash Flow attributable to discontinued
operations, as determined in accordance with GAAP, and operations or businesses
disposed of prior to the Calculation Date, will be excluded; and

                  (3) the Fixed Charges attributable to discontinued operations,
as determined in accordance with GAAP, and operations or businesses disposed of
prior to the Calculation Date, will be excluded, but only to the extent that the
obligations giving rise to such Fixed Charges will not be obligations of the
specified Person or any of its Restricted Subsidiaries following the Calculation
Date.

                  "Fixed Charges" means, with respect to any specified Person
for any period, the sum, without duplication, of:

                  (1) the consolidated interest expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued, including,
without limitation, amortization of debt issuance costs and original issue
discount, non-cash interest payments, the interest component of any deferred
payment obligations, the interest component of all payments associated with
Capital Lease Obligations, imputed interest with respect to Attributable Debt,
commissions, discounts and other fees and charges incurred in respect of letter
of credit or bankers' acceptance financings, and net of the effect of all
payments made or received pursuant to Hedging Obligations; plus

                  (2) the consolidated interest of such Person and its
Restricted Subsidiaries that was capitalized during such period; plus

                  (3) any interest expense on Indebtedness of another Person
that is Guaranteed by such Person or secured by a Lien on assets of such Person,
whether or not such Guarantee or Lien is called upon; plus

                  (4) the product of (a) all dividends, whether paid or accrued
and whether or not in cash, on any series of preferred stock of such Person or
any of its Restricted Subsidiaries other than dividends on Equity Interests
payable solely in Equity Interests of such Person (other than Disqualified
Stock) or to such Person or one of its Restricted Subsidiaries, times (b) a
fraction, the numerator of which is one and the denominator of which is one
minus the then current combined federal, state and local statutory tax rate of
such Person, expressed as a decimal, in each case, on a consolidated basis and
in accordance with GAAP.

                  "GAAP" means generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such



                                       7



other entity as have been approved by a significant segment of the accounting
profession, which are in effect on the date of this Indenture.

                  "Global Note Legend" means the legend set forth in Section
2.06(g)(ii), which is required to be placed on all Global Notes issued under
this Indenture.

                  "Global Notes" means the global Notes in the form of Exhibit A
hereto issued in accordance with Article 2 hereof.

                  "Government Securities" means direct obligations (or
certificates representing an ownership interest in such obligations) of the
United States of America (including any agency or instrumentality thereof) for
the payment of which the full faith and credit of the United States of America
is pledged and which are not callable at the Company's option.

                  "Guarantee" means a guarantee other than by endorsement of
negotiable instruments for collection in the ordinary course of business, direct
or indirect, in any manner including, without limitation, by way of a pledge of
assets or through letters of credit or reimbursement agreements in respect
thereof, of all or any part of any Indebtedness.

                  "Hedging Obligations" means, with respect to any specified
Person, the obligations of such Person under:

                  (1) interest rate swap agreements, interest rate cap
agreements and interest rate collar agreements;

                  (2) other agreements or arrangements designed to protect such
Person against fluctuations in interest rates; and

                  (3) foreign exchange contracts, currency swap agreements or
other agreements or arrangements designed to protect such Person against
fluctuations in currency values.

                  "Holder" means a Person in whose name a Note is registered.

                  "IAI Global Note" means a global Note in the form of Exhibit A
hereto bearing the Global Note Legend and the Private Placement Legend and
deposited with and registered in the name of the Depositary or its nominee that
will be issued in a denomination equal to the outstanding principal amount of
the Notes sold to Institutional Accredited Investors, if any.

                  "Indebtedness" means, with respect to any specified Person,
any indebtedness of such Person, whether or not contingent:

                  (1) in respect of borrowed money;

                  (2) evidenced by bonds, notes, debentures or similar
instruments or letters of credit (or reimbursement agreements in respect
thereof);

                  (3) in respect of banker's acceptances;

                  (4) representing Capital Lease Obligations;

                  (5) representing the balance deferred and unpaid of the
purchase price of any property, except any such balance that constitutes an
accrued expense or trade payable; or

                  (6) representing any Hedging Obligations,



                                       8




if and to the extent any of the preceding items (other than letters of credit
and Hedging Obligations) would appear as a liability upon a balance sheet of the
specified Person prepared in accordance with GAAP. In addition, the term
"Indebtedness" includes all Indebtedness of others secured by a Lien on any
asset of the specified Person (whether or not such Indebtedness is assumed by
the specified Person) and, to the extent not otherwise included, the Guarantee
by the specified Person of any Indebtedness of any other Person.

                  The amount of any Indebtedness outstanding as of any date will
be:

                  (1) the accreted value of the Indebtedness, in the case of any
Indebtedness issued with original issue discount; and

                  (2) the principal amount of the Indebtedness, together with
any interest on the Indebtedness that is more than 30 days past due, in the case
of any other Indebtedness.

                  "Indenture" means this instrument, as originally executed or
as it may from time to time be supplemented or amended in accordance with
Article 9 hereof.

                  "Indirect Participant" means a Person who holds a beneficial
interest in a Global Note through a Participant.

                  "Initial Notes" means $150,000,000 aggregate principal amount
of Notes issued under this Indenture on the date hereof.

                  "Institutional Accredited Investor" means an institution that
is an "accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under
the Securities Act.

                  "Investments" means, with respect to any Person, all direct or
indirect investments by such Person in other Persons (including Affiliates) in
the forms of loans (including Guarantees or other obligations), advances or
capital contributions (excluding commission, travel and similar advances to
officers and employees made in the ordinary course of business), purchases or
other acquisitions for consideration of Indebtedness, Equity Interests or other
securities, together with all items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP; provided that
Investments shall not be deemed to include extensions of trade credit by the
Company or any of its Restricted Subsidiaries on commercially reasonable terms
in accordance with normal trade practices. If the Company or any of its
Subsidiaries sells or otherwise disposes of any Equity Interests of any direct
or indirect Subsidiary of the Company such that, after giving effect to any such
sale or disposition, such Person is no longer a Subsidiary of the Company, the
Company will be deemed to have made an Investment on the date of any such sale
or disposition equal to the fair market value of the Equity Interests of such
Subsidiary not sold or disposed of in an amount determined as provided in the
final paragraph of Section 4.10. The acquisition by the Company or any of its
Subsidiaries of a Person that holds an Investment in a third Person will be
deemed to be an Investment by the Company or such Subsidiary in such third
Person in an amount equal to the fair market value of the Investment held by the
acquired Person in such third Person in an amount determined as provided in the
final paragraph of Section 4.10.

                  "Legal Holiday" means a Saturday, a Sunday or a day on which
banking institutions in the City of New York, the city in which the Corporate
Trust Office of the Trustee is located, or at a place of payment are authorized
by law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue on
such payment for the intervening period.

                  "Letter of Transmittal" means the letter of transmittal to be
prepared by the Company and sent to all Holders of the Initial Notes for use by
such Holders in connection with the Exchange Offer.

                  "Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset, whether or not filed, recorded or otherwise perfected under applicable
law, including any conditional sale or other title retention agreement, any
lease in the nature thereof, any




                                       9


option or other agreement to sell or give a security interest in and any filing
of or agreement to give any financing statement under the Uniform Commercial
Code (or equivalent statutes) of any jurisdiction.

                  "Moody's" means Moody's Investors Service, Inc. or any
successor to the rating agency business thereof.

                  "Net Income" means, with respect to any specified Person, the
net income (loss) of such Person, determined in accordance with GAAP and before
any reduction in respect of preferred stock dividends, excluding, however:

                  (1) any gain (but not loss), together with any related
provision for taxes on such gain (but not loss), realized in connection with:
(a) any Asset Sale or (b) the disposition of any securities by such Person or
any of its Restricted Subsidiaries or the extinguishment of any Indebtedness of
such Person or any of its Restricted Subsidiaries; and

                  (2) any extraordinary gain (but not loss), together with any
related provision for taxes on such extraordinary gain (but not loss).

                  "Net Proceeds" means the aggregate cash proceeds received by
the Company or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration, including Designated Non-Cash
Consideration, deemed to be cash pursuant to Section 4.12, received in any Asset
Sale), net of the direct costs relating to such Asset Sale, including, without
limitation, legal, accounting and investment banking fees, and sales
commissions, and any relocation expenses incurred as a result of the Asset Sale,
taxes paid or payable as a result of the Asset Sale, in each case, after taking
into account any available tax credits or deductions and any tax sharing
arrangements, and amounts required to be applied to the repayment of
Indebtedness, other than Senior Debt, secured by a Lien on the asset or assets
that were the subject of such Asset Sale, and any reserve for adjustment in
respect of the sale price of such asset or assets established in accordance with
GAAP.

                  "Non-Recourse Debt" means Indebtedness:

                  (1) as to which neither the Company nor any of its Restricted
Subsidiaries (a) provides credit support of any kind (including any undertaking,
agreement or instrument that would constitute Indebtedness), (b) is directly or
indirectly liable as a guarantor or otherwise, or (c) constitutes the lender;

                  (2) no default with respect to which (including any rights
that the holders thereof may have to take enforcement action against an
Unrestricted Subsidiary) would permit upon notice, lapse of time or both any
holder of any other Indebtedness (other than the Notes) of the Company or any of
its Restricted Subsidiaries to declare a default on such other Indebtedness or
cause the payment thereof to be accelerated or payable prior to its stated
maturity; and

                  (3) as to which the lenders have been notified in writing that
they will not have any recourse to the Company's stock or assets or the stock or
assets of any of the Company's Restricted Subsidiaries.

                  "Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.

                  "Officer" means the Chief Executive Officer, the President,
the Chief Financial Officer, or any Senior Vice President of the Company.

                  "Officers' Certificate" means a certificate, in form and
substance reasonably satisfactory to the Trustee, signed by two Officers of the
Company, at least one of whom shall be the principal executive officer or
principal financial officer of the Company, and delivered to the Trustee.




                                       10




                  "Opinion of Counsel" means a written opinion, in form and
substance reasonably satisfactory to the Trustee, from legal counsel who is
acceptable to the Trustee and which meets the requirements of Section 12.05
hereof. The counsel may be an employee of or counsel to the Company or the
Trustee.

                  "Parent" means Extendicare, Inc., a corporation organized
under the laws of Canada.

                  "Participant" means, with respect to the Depositary, Euroclear
or Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively, and, with respect to The Depository Trust Company,
shall include Euroclear and Clearstream.

                  "Permitted Business" means the lines of business conducted by
the Company and its Restricted Subsidiaries on the date hereof and the
businesses reasonably related thereto within the healthcare services sector.

                  "Permitted Investments" means:

                  (1) any Investment in the Company or in one of its Wholly
Owned Restricted Subsidiaries;

                  (2) any Investment outstanding as of the date hereof;

                  (3) any Investment in Cash Equivalents;

                  (4) loans and advances to employees and officers of the
Company and its Restricted Subsidiaries in the ordinary course of business for
bona fide business purposes not in excess of $1.0 million at any one time
outstanding;

                  (5) Investments in prepaid expenses, negotiable instruments
held for collection and lease, utility and workers' compensation, performance
and other similar deposits;

                  (6) any Investment by the Company or any of its Restricted
Subsidiaries in a Person engaged in a Permitted Business, if as a result of such
Investment:

                      (a) such Person becomes one of the Company's Wholly Owned
         Restricted Subsidiaries; or

                      (b) such Person is merged, consolidated or amalgamated
         with or into, or transfers or conveys substantially all of its assets
         to, or is liquidated into, the Company or one of its Wholly Owned
         Restricted Subsidiaries;

                  (7) any Investment made as a result of the receipt of non-cash
consideration (including Designated Non-Cash Consideration) from an Asset Sale
that was made pursuant to and in compliance with Section 4.12;

                  (8) any acquisition of assets, Equity Interests or other
securities solely in exchange for the issuance of Equity Interests (other than
Disqualified Stock) of the Company;

                  (9) any Investments received in compromise of obligations of
such Persons incurred in the ordinary course of trade creditors or customers
that were incurred in the ordinary course of business, including pursuant to any
plan of reorganization or similar arrangement upon the bankruptcy or insolvency
of any trade creditor or customer;

                  (10) Hedging Obligations;

                  (11) any Investment made in a Special Purpose Vehicle in
connection with a Securitization Transaction or to provide adequate capital to a
Special Purpose Vehicle in anticipation of one or more Securitization
Transactions; and




                                       11




                  (12) other Investments in any Person having an aggregate fair
market value (measured on the date each such Investment was made and without
giving effect to subsequent changes in value), when taken together with all
other Investments made pursuant to this clause (12) that are at the time
outstanding, not to exceed $10.0 million.

                  "Permitted Liens" means:

                  (1) Liens securing Indebtedness under Credit Facilities,
including the Credit Agreement, where such Indebtedness was permitted by the
terms of this Indenture to be incurred;

                  (2) Liens in favor of the Company or the Subsidiary
Guarantors;

                  (3) Liens on property of a Person existing at the time such
Person is merged with or into or consolidated with the Company or any of the
Company's Restricted Subsidiaries; provided that such Liens were in existence
prior to the contemplation of such merger or consolidation and do not extend to
any assets other than those of the Person merged into or consolidated with the
Company or such Restricted Subsidiary;

                  (4) Liens on property existing at the time of acquisition of
the property by the Company or any of its Restricted Subsidiaries; provided that
such Liens were in existence prior to the contemplation of such acquisition;

                  (5) Liens to secure the performance of statutory obligations,
surety or appeal bonds, performance bonds or other obligations of a like nature;

                  (6) Liens to secure Indebtedness (including Capital Lease
Obligations) permitted by clause (iv) of the second paragraph of Section 4.09
covering only the assets acquired with such Indebtedness;

                  (7) Liens existing on the date of this Indenture;

                  (8) Liens for taxes, assessments or governmental charges or
claims that are not yet delinquent or that are being contested in good faith by
appropriate proceedings promptly instituted and diligently concluded; provided
that any reserve or other appropriate provision as is required in conformity
with GAAP has been made therefor;

                  (9) pledges or deposits in the ordinary course of business to
secure lease obligations or nondelinquent obligations under workers'
compensation, unemployment insurance or similar legislation;

                  (10) easements, rights-of-way, restrictions, minor defects or
irregularities in title and other similar charges or encumbrances not
interfering in any material respect with the business or assets of the Company
or any of its Subsidiaries incurred in the ordinary course of business;

                  (11) Liens to secure Hedging Obligations, including any
guarantees of such Hedging Obligations;

                  (12) Liens incurred in connection with a sale and leaseback
transaction permitted under Section 4.15 that do not exceed 5% of our
Consolidated Tangible Assets; and

                  (13) Liens incurred by the Company or any of its Restricted
Subsidiaries with respect to obligations that do not exceed $10.0 million at any
one time outstanding; provided that such amount shall be reduced by any amount
incurred under clause (12) above.

                  "Permitted Refinancing Indebtedness" means any Indebtedness of
the Company or any of its Restricted Subsidiaries issued in exchange for, or the
net proceeds of which are used to extend, refinance, renew, replace, defease or
refund other Indebtedness of the Company or any of its Restricted Subsidiaries
(other than intercompany Indebtedness); provided that:



                                       12



                  (1) the principal amount (or accreted value, if applicable) of
such Permitted Refinancing Indebtedness does not exceed the principal amount (or
accreted value, if applicable) of the Indebtedness extended, refinanced,
renewed, replaced, defeased or refunded (plus all accrued interest on the
Indebtedness and the amount of all expenses and premiums incurred in connection
therewith);

                  (2) such Permitted Refinancing Indebtedness has a final
maturity date later than the final maturity date of, and has a Weighted Average
Life to Maturity equal to or greater than the Weighted Average Life to Maturity
of, the Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded;

                  (3) either

                      (a) if the Indebtedness being extended, refinanced,
         renewed, replaced, defeased or refunded is subordinated in right of
         payment to the Notes (including the Senior Subordinated Notes), such
         Permitted Refinancing Indebtedness has a final maturity date later than
         the final maturity date of, and is subordinated in right of payment to,
         the Notes on terms at least as favorable to the Holders of Notes as
         those contained in the documentation governing the Indebtedness being
         extended, refinanced, renewed, replaced, defeased or refunded; or

                      (b) with respect to only the Senior Subordinated Notes, at
         the time of such incurrence the Company's Consolidated Senior Debt
         Leverage Ratio would have been less than 2.75 to 1; provided that when
         calculating such ratio, pro forma effect will be given to (A) the
         incurrence of such Indebtedness and the application of the proceeds
         therefrom, including to refinance the Senior Subordinated Notes and (B)
         the acquisition (whether by purchase, merger or otherwise) or
         disposition (whether by sale, merger or otherwise) of any company,
         entity or business acquired or disposed of by the Company or any of its
         Restricted Subsidiaries, as the case may be, since the first day of the
         four-quarter period referred to in the definition of Consolidated
         Senior Debt Leverage Ratio as if such acquisition or disposition had
         occurred at the beginning of such four-quarter period; and

                  (4) such Indebtedness is incurred either by the Company or by
the Subsidiary who is the obligor on the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded.

                  "Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
limited liability company or government or other entity.

                  "Private Placement Legend" means the legend set forth in
Section 2.06(g)(i) hereof to be placed on all Notes issued under this Indenture
except as otherwise permitted by the provisions of this Indenture.

                  "QIB" means a "qualified institutional buyer" as defined in
Rule 144A.

                  "Qualified Equity Offering" means any underwritten public or
any private offering of Capital Stock (excluding Disqualified Stock) of the
Company or any of Parent's Capital Stock (excluding Disqualified Stock), in the
latter case, only to the extent that the net cash proceeds therefrom are
contributed to the Company's common or non-redeemable preferred equity capital.

                  "Registration Rights Agreement" means the Registration Rights
Agreement dated as of the date hereof, among the Company, the Subsidiary
Guarantors and the initial purchasers named therein, as such agreement may be
amended, modified or supplemented from time to time and, with respect to any
Additional Notes, one or more registration rights agreements between the Company
and the other parties thereto, as such agreement(s) may be amended, modified or
supplemented from time to time, relating to rights given by the Company to the
purchasers of Additional Notes to register such Additional Notes under the
Securities Act.

                  "Regulation S" means Regulation S promulgated under the
Securities Act.

                  "Regulation S Global Note" means the global note in the form
of Exhibit A hereto bearing the Global Note Legend and the Private Placement
Legend and deposited with and registered in the name of the




                                       13



Depositary or its nominee that will be issued in a denomination equal to the
outstanding principal amount of Notes sold in reliance on Regulation S.

                  "Replacement Assets" means any properties or assets used or
useful in a Permitted Business.

                  "Responsible Officer," when used with respect to the Trustee,
means any officer within the Corporate Trust Department of the Trustee (or any
successor group of the Trustee) with direct responsibility for the
administration of this Indenture and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his or her knowledge of and familiarity with the particular subject.

                  "Restricted Definitive Note" means one or more Definitive
Notes bearing the Private Placement Legend.

                  "Restricted Global Notes" means the 144A Global Note, the IAI
Global Note and the Regulation S Global Note.

                  "Restricted Investment" means an Investment other than a
Permitted Investment.

                  "Restricted Subsidiary" of a Person means any Subsidiary of
the referent Person that is not an Unrestricted Subsidiary.

                  "Rule 144" means Rule 144 promulgated under the Securities
Act.

                  "Rule 144A" means Rule 144A promulgated under the Securities
Act.

                  "Rule 903" means Rule 903 promulgated under the Securities
Act.

                  "Rule 904" means Rule 904 promulgated under the Securities
Act.

                  "SEC" means the Securities and Exchange Commission.

                  "Securities Act" means the Securities Act of 1933, as amended.

                  "Securitization Transaction" means any sale, conveyance or
other disposition by the Company or any of its Restricted Subsidiaries of any
accounts receivable or any interest therein to a Special Purpose Vehicle.

                  "Senior Debt" means:

                  (1) all Indebtedness of the Company or of any Subsidiary
Guarantor outstanding under Credit Facilities and all Hedging Obligations with
respect thereto;

                  (2) any other Indebtedness of the Company or of any Subsidiary
Guarantor permitted to be incurred under the terms of this Indenture, unless the
instrument under which such Indebtedness is incurred expressly provides that it
is on a parity with or subordinated in right of payment to the Notes or any
Subsidiary Guarantee; and

                  (3) all Obligations with respect to the items listed in the
preceding clauses (1) and (2).

                  Notwithstanding anything to the contrary in the preceding,
Senior Debt will not include:

                  (1) any liability for federal, state, local or other taxes
owed or owing by the Company;

                  (2) any Indebtedness of the Company to any of its Subsidiaries
or other Affiliates;

                  (3) any trade payables; or




                                       14



                  (4) the portion of any Indebtedness that is incurred in
violation of this Indenture.

                  "Senior Subordinated Note Indenture" means the Indenture,
dated as of December 2, 1997, by and among the Company, the guarantors signatory
thereto and The Bank of Nova Scotia Trust Company of New York, as Trustee,
governing the Company's Senior Subordinated Notes.

                  "Senior Subordinated Notes" means the 9.35% Senior
Subordinated Notes due 2007 of the Company.

                  "Shelf Registration Statement" means the Shelf Registration
Statement as defined in the Registration Rights Agreement.

                  "Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such Regulation is in effect on
the date hereof.

                  "Special Purpose Vehicle" means a bankruptcy-remote entity or
trust or other special purpose entity which is formed by the Company, any
Subsidiary of the Company or any other Person for the purpose of, and engages in
no material business other than, acting as a buyer in a Securitization
Transaction or other similar transactions of accounts receivable or other
similar assets, financing the purchases it makes as such a buyer and realizing,
directly or indirectly, on such accounts receivable or other similar assets.

                  "Stated Maturity" means, with respect to any installment of
interest or principal on any series of Indebtedness (including, without
limitation, a scheduled repayment or a scheduled sinking fund payment), the date
on which the payment of interest or principal was scheduled to be paid in the
original documentation governing such Indebtedness, and will not include any
contingent obligations to repay, redeem or repurchase any such interest or
principal prior to the date originally scheduled for the payment thereof.

                  "Subordinated Indebtedness" means any Indebtedness (whether
outstanding on the date hereof or thereafter incurred, including the Senior
Subordinated Notes) that is subordinated or junior in right of payment to the
Notes or the Subsidiary Guarantees pursuant to a written agreement, executed by
the Person to whom such Indebtedness is owed, to that effect.

                  "Subsidiary" means, with respect to any specified Person:

                  (1) any corporation, association or other business entity of
which more than 50% of the total voting power of shares of Capital Stock
entitled (without regard to the occurrence of any contingency) to vote in the
election of directors, managers or trustees of the corporation, association or
other business entity is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries of that
Person (or a combination thereof); and

                  (2) any partnership (a) the sole general partner or the
managing general partner of which is such Person or a Subsidiary of such Person
or (b) the only general partners of which are that Person or one or more
Subsidiaries of that Person (or any combination thereof).

                  "Subsidiary Guarantee" means the Guarantee of the Notes by
each of the Subsidiary Guarantors pursuant to Article 10 and in the form of the
Guarantee attached as Exhibit E and any additional Guarantee of the Notes to be
executed by any Subsidiary of the Company pursuant to Section 4.19.

                  "Subsidiary Guarantors" means all of the Company's existing
and future domestic Significant Subsidiaries, all of the Company's existing and
future Domestic Subsidiaries that guarantee or incur any Indebtedness and any
other existing or future Significant Subsidiaries or Restricted Subsidiaries
that guarantee or otherwise provide direct credit support for Indebtedness of
the Company or any of its Domestic Subsidiaries.

                  "TIA" means the Trust Indenture Act of 1939, as amended.




                                       15


                  "Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.

                  "Unrestricted Definitive Notes" means one or more Definitive
Notes that do not and are not required to bear the Private Placement Legend.

                  "Unrestricted Global Notes" means one or more Global Notes, in
the form of Exhibit A attached hereto, that do not and are not required to bear
the Private Placement Legend and are deposited with and registered in the name
of the Depositary or its nominee.

                  "Unrestricted Subsidiary" means any Subsidiary of the Company
(or any successor to any of them) that is designated by the Board of Directors
of the Company as an Unrestricted Subsidiary pursuant to a Board Resolution, but
only to the extent that such Subsidiary:

                  (1) has no Indebtedness other than Non-Recourse Debt;

                  (2) is not party to any agreement, contract, arrangement or
understanding with the Company or any of its Restricted Subsidiaries unless the
terms of any such agreement, contract, arrangement or understanding are no less
favorable to the Company or such Restricted Subsidiary than those that might be
obtained at the time from Persons who are not Affiliates of the Company;

                  (3) is a Person with respect to which neither the Company nor
any of its Restricted Subsidiaries has any direct or indirect obligation (a) to
subscribe for additional Equity Interests or (b) to maintain or preserve such
Person's financial condition or to cause such Person to achieve any specified
levels of operating results;

                  (4) has not guaranteed or otherwise directly or indirectly
provided credit support for any Indebtedness of the Company or any of its
Restricted Subsidiaries; and

                  (5) has at least one director on its Board of Directors that
is not a director or executive officer of the Company or any of its Restricted
Subsidiaries and has at least one executive officer that is not a director or
executive officer of the Company or any of its Restricted Subsidiaries.

                  Any designation of a Subsidiary of the Company as an
Unrestricted Subsidiary will be evidenced to the Trustee by filing with the
Trustee a certified copy of the resolution of the Board of Directors of the
Company giving effect to such designation and an Officers' Certificate
certifying that such designation complied with the preceding conditions and was
permitted by Section 4.10 hereof. If, at any time, any Unrestricted Subsidiary
would fail to meet the preceding requirements as an Unrestricted Subsidiary, it
will thereafter cease to be an Unrestricted Subsidiary for purposes of this
Indenture and any Indebtedness of such Subsidiary will be deemed to be incurred
by a Restricted Subsidiary of the Company as of such date and, if such
Indebtedness is not permitted to be incurred as of such date under Section 4.09,
the Company will be in default of such covenant. The Board of Directors of the
Company may at any time designate any Unrestricted Subsidiary to be a Restricted
Subsidiary; provided that such designation will be deemed to be an incurrence of
Indebtedness by one of the Company's Restricted Subsidiaries of any outstanding
Indebtedness of such Unrestricted Subsidiary and such designation will only be
permitted if (1) such Indebtedness is permitted under Section 4.09, calculated
on a pro forma basis as if such designation had occurred at the beginning of the
four-quarter reference period; (2) no Default or Event of Default would be in
existence following such designation; and (3) such Subsidiary executes and
delivers to the Trustee a supplemental indenture providing for a Subsidiary
Guarantee.

                  "Voting Stock" of any Person as of any date means the Capital
Stock of such Person that is at the time entitled to vote in the election of the
Board of Directors of such Person.

                  "Weighted Average Life to Maturity" means, when applied to any
Indebtedness at any date, the number of years obtained by dividing:


                                       16





                  (1) the sum of the products obtained by multiplying (a) the
amount of each then remaining installment, sinking fund, serial maturity or
other required payments of principal, including payment at final maturity, in
respect of the Indebtedness, by (b) the number of years (calculated to the
nearest one-twelfth) that will elapse between such date and the making of such
payment; by

                  (2) the then outstanding principal amount of such
Indebtedness.

Section 1.02.     OTHER DEFINITIONS.
                  -----------------

                                                                      Defined in
             Term                                                        Section
             ----                                                        -------
             "Affiliate Transaction".......................................4.14
             "Asset Sale Offer"............................................3.09
             "Authentication Order"........................................2.02
             "Benefited Party".............................................10.01
             "Change of Control Offer".....................................4.18
             "Change of Control Purchase Price"............................4.18
             "Covenant Defeasance".........................................8.03
             "DTC".........................................................2.03
             "Event of Default"............................................6.01
             "Excess Proceeds".............................................4.12
             "incur".......................................................4.09
             "Legal Defeasance"............................................8.02
             "losses"......................................................7.07
             "Offer Amount"................................................3.09
             "Offer Period"................................................3.09
             "Paying Agent"................................................2.03
             "Payment Default".............................................6.01
             "Permitted Debt"..............................................4.09
             "Purchase Date"...............................................3.09
             "Registrar"...................................................2.03
             "Restricted Payments".........................................4.10
             "Security Register"...........................................4.18

Section 1.03      INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
                  -------------------------------------------------

                  (a) Whenever this Indenture refers to a provision of the TIA,
the provision is incorporated by reference in and made a part of this Indenture.

                  (b) The following TIA terms used in this Indenture have the
following meanings:

                  "indenture securities" means the Notes;

                  "indenture security holder" means a Holder of a Note;

                  "indenture to be qualified" means this Indenture;

                  "indenture trustee" or "institutional trustee" means the
Trustee; and

                  "obligor" on the Notes means the Company and any successor
obligor upon the Notes.

                  (c) All other terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another statute or defined by SEC rule
under the TIA have the meanings so assigned to them.



                                       17



Section 1.04.     RULES OF CONSTRUCTION.
                  ---------------------

                  (a) Unless the context otherwise requires:

                       (i) a term has the meaning assigned to it;

                       (ii) an accounting term not otherwise defined herein has
         the meaning assigned to it in accordance with GAAP;

                       (iii) "or" is not exclusive;

                       (iv) words in the singular include the plural, and in the
         plural include the singular;

                       (v) all references in this instrument to designated
         "Articles," "Sections" and other subdivisions are to the designated
         Articles, Sections and subdivisions of this instrument as originally
         executed;

                       (vi) the words "herein," "hereof" and "hereunder" and
         other words of similar import refer to this Indenture as a whole and
         not to any particular Article, Section or other subdivision.

                       (vii) "including" means "including without limitation";

                       (viii) provisions apply to successive events and
         transactions; and

                       (ix) references to sections of or rules under the
         Securities Act shall be deemed to include substitute, replacement or
         successor sections or rules adopted by the SEC from time to time.

                                   ARTICLE 2.

                                    THE NOTES

Section 2.01.     FORM AND DATING.
                  ---------------

                  (a) GENERAL. The Notes and the Trustee's certificate of
authentication shall be substantially in the form of Exhibit A hereto, which is
hereby incorporated in and expressly made part of this Indenture. The Notes may
have notations, legends or endorsements required by law, stock exchange rule or
usage. Each Note shall be dated the date of its authentication. The Notes shall
be in denominations of $1,000 and integral multiples thereof. The terms and
provisions contained in the Notes shall constitute, and are hereby expressly
made, a part of this Indenture and the Company and the Trustee, by their
execution and delivery of this Indenture, expressly agree to such terms and
provisions and to be bound thereby. However, to the extent any provision of any
Note conflicts with the express provisions of this Indenture, the provisions of
this Indenture shall govern and be controlling.

                  (b) FORM OF NOTES. The Notes shall be issued initially in
global form and shall be substantially in the form of Exhibit A attached hereto
(including the Global Note Legend thereon and the "Schedule of Exchanges of
Interests in the Global Note" attached thereto). Notes issued in definitive form
shall be substantially in the form of Exhibit A attached hereto (but without the
Global Note Legend thereon and without the "Schedule of Exchanges of Interests
in the Global Note" attached thereto). Each Global Note shall represent such of
the outstanding Notes as shall be specified therein and each shall provide that
it shall represent the aggregate principal amount of outstanding Notes from time
to time endorsed thereon and that the aggregate principal amount of outstanding
Notes represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions. Any endorsement of a Global
Note to reflect the amount of any increase or decrease in the aggregate
principal amount of outstanding Notes represented thereby shall be made by the
Trustee or the Custodian, at the direction of the Trustee, in accordance with
instructions given by the Holder thereof as required by Section 2.06 hereof.



                                       18




                  (c) BOOK-ENTRY PROVISIONS. This Section 2.01(c) shall only
apply to Global Notes deposited with the Trustee, as custodian for the
Depositary. Participants and Indirect Participants shall have no rights under
this Indenture with respect to any Global Note held on their behalf by the
Depositary or by the Trustee as the custodian for the Depositary or under such
Global Note, and the Depositary shall be treated by the Company, the Trustee and
any agent of the Company or the Trustee as the absolute owner of such Global
Note for all purposes whatsoever. Notwithstanding the foregoing, nothing herein
shall prevent the Company, the Trustee or any agent of the Company or the
Trustee from giving effect to any written certification, proxy or other
authorization furnished by the Depositary or impair, as between the Depositary
and its Participants or Indirect Participants, the Applicable Procedures or the
operation of customary practices of the Depositary governing the exercise of the
rights of a holder of a beneficial interest in any Global Note.

Section 2.02.     EXECUTION AND AUTHENTICATION.
                  ----------------------------

                  (a) One Officer shall sign the Notes for the Company by manual
or facsimile signature.

                  (b) If an Officer whose signature is on a Note no longer holds
that office at the time a Note is authenticated, the Note shall nevertheless be
valid.

                  (c) A Note shall not be valid until authenticated by the
manual signature of the Trustee. The signature shall be conclusive evidence that
the Note has been authenticated under this Indenture.

                  (d) The Trustee shall, upon a written order of the Company
signed by an Officer (an "AUTHENTICATION ORDER"), authenticate Notes for
original issue.

                  (e) The Trustee may appoint an authenticating agent acceptable
to the Company to authenticate Notes. An authenticating agent may authenticate
Notes whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with Holders or an
Affiliate of the Company.

                  (f) The Company may issue Additional Notes from time to time
after the offering of the Initial Notes. The Initial Notes, the Exchange Notes
and any Additional Notes subsequently issued under this Indenture shall be
treated as a single class for all purposes under this Indenture, including,
without limitation, waivers, amendments, redemptions and offers to purchase.

Section 2.03.     REGISTRAR AND PAYING AGENT.
                  --------------------------

                  (a) The Company shall maintain an office or agency where Notes
may be presented for registration of transfer or for exchange ("REGISTRAR") and
an office or agency where Notes may be presented for payment ("PAYING AGENT").
The Registrar shall keep a register of the Notes and of their transfer and
exchange. The Company may appoint one or more co-registrars and one or more
additional paying agents. The term "Registrar" includes any co-registrar and the
term "Paying Agent" includes any additional paying agent. The Company may change
any Paying Agent or Registrar without notice to any Holder. The Company shall
notify the Trustee in writing of the name and address of any Agent not a party
to this Indenture. If the Company fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Company or any of
its Subsidiaries may act as Paying Agent or Registrar.

                  (b) The Company initially appoints The Depository Trust
Company ("DTC") to act as Depositary with respect to the Global Notes.

                  (c) The Company initially appoints the Trustee to act as the
Registrar and Paying Agent and to act as Custodian with respect to the Global
Notes.


                                       19

Section 2.04.     PAYING AGENT TO HOLD MONEY IN TRUST.
                  -----------------------------------

                  The Company shall require each Paying Agent other than the
Trustee to agree in writing that the Paying Agent shall hold in trust for the
benefit of Holders or the Trustee all money held by the Paying Agent for the
payment of principal, premium, if any, or interest and Additional Interest, if
any, on the Notes, and shall notify the Trustee of any default by the Company in
making any such payment. While any such default continues, the Trustee may
require a Paying Agent to pay all money held by it to the Trustee. The Company
at any time may require a Paying Agent to pay all money held by it to the
Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the
Company or a Subsidiary) shall have no further liability for the money. If the
Company or a Subsidiary acts as Paying Agent, it shall segregate and hold in a
separate trust fund for the benefit of the Holders all money held by it as
Paying Agent. Upon any bankruptcy or reorganization proceedings relating to the
Company, the Trustee shall serve as Paying Agent for the Notes.

Section 2.05.     HOLDER LISTS.
                  ------------

                  The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of all Holders and shall otherwise comply with TIA ss. 312(a). If the
Trustee is not the Registrar, the Company shall furnish to the Trustee at least
seven Business Days before each Interest Payment Date and at such other times as
the Trustee may request in writing, a list in such form and as of such date or
such shorter time as the Trustee may allow, as the Trustee may reasonably
require of the names and addresses of the Holders and the Company shall
otherwise comply with TIA ss. 312(a).

Section 2.06.     TRANSFER AND EXCHANGE.
                  ---------------------

                  (a) TRANSFER AND EXCHANGE OF GLOBAL NOTES. A Global Note may
not be transferred as a whole except by the Depositary to a nominee of the
Depositary, by a nominee of the Depositary to the Depositary or to another
nominee of the Depositary, or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary. All Global Notes
will be exchanged by the Company for Definitive Notes if (1) the Company
delivers to the Trustee notice from the Depositary that it is unwilling or
unable to continue to act as Depositary or that it is no longer a clearing
agency registered under the Exchange Act and, in either case, a successor
Depositary is not appointed by the Company within 120 days after the date of
such notice from the Depositary or (2) the Company in its sole discretion
determines that the Global Notes (in whole but not in part) should be exchanged
for Definitive Notes and deliver a written notice to such effect to the Trustee;
or (3) an Event of Default shall have occurred and be continuing. Upon the
occurrence of any of the preceding events in (1), (2) or (3) above, Definitive
Notes shall be issued in denominations of $1,000 or integral multiples thereof
and in such names as the Depositary shall instruct the Trustee. Global Notes
also may be exchanged or replaced, in whole or in part, as provided in Sections
2.07 and 2.10 hereof. Every Note authenticated and delivered in exchange for, or
in lieu of, a Global Note or any portion thereof, pursuant to this Section 2.06
or Section 2.07 or 2.10 hereof, shall be authenticated and delivered in the form
of, and shall be, a Global Note. A Global Note may not be exchanged for another
Note other than as provided in this Section 2.06(a), however, beneficial
interests in a Global Note may be transferred and exchanged as provided in
Section 2.06(b), (c) or (f) hereof.

                  (b) TRANSFER AND EXCHANGE OF BENEFICIAL INTERESTS IN THE
GLOBAL NOTES. The transfer and exchange of beneficial interests in the Global
Notes shall be effected through the Depositary, in accordance with the
provisions of this Indenture and the Applicable Procedures. Beneficial interests
in the Restricted Global Notes shall be subject to restrictions on transfer
comparable to those set forth herein to the extent required by the Securities
Act. Transfers of beneficial interests in the Global Notes also shall require
compliance with either clause (i) or (ii) below, as applicable, as well as one
or more of the other following clauses, as applicable:

                (i) Transfer of Beneficial Interests in the Same Global Note.
          Beneficial interests in any Restricted Global Note may be transferred
          to Persons who take delivery thereof in the form of a beneficial
          interest in the same Restricted Global Note in accordance with the
          transfer restrictions set forth in the Private Placement Legend;
          provided, however, that prior to the expiration of the Distribution
          Compliance Period, transfers of beneficial interests in the Regulation
          S Global Note may not be made to a U.S. Person or for the account or
          benefit of a U.S. Person (other than an Initial Purchaser). Beneficial
          interests in any Unrestricted Global Note may be transferred to
          Persons who take delivery thereof in the form of a



                                       20


          beneficial interest in an Unrestricted Global Note. No written orders
          or instructions shall be required to be delivered to the Registrar to
          effect the transfers described in this Section 2.06(b)(i).

                (ii) All Other Transfers and Exchanges of Beneficial Interests
          in Global Notes. In connection with all transfers and exchanges of
          beneficial interests that are not subject to Section 2.06(b)(i) above,
          the transferor of such beneficial interest must deliver to the
          Registrar either (A)(1) a written order from a Participant or an
          Indirect Participant given to the Depositary in accordance with the
          Applicable Procedures directing the Depositary to credit or cause to
          be credited a beneficial interest in another Global Note in an amount
          equal to the beneficial interest to be transferred or exchanged and
          (2) instructions given in accordance with the Applicable Procedures
          containing information regarding the Participant account to be
          credited with such increase or (B)(1) a written order from a
          Participant or an Indirect Participant given to the Depositary in
          accordance with the Applicable Procedures directing the Depositary to
          cause to be issued a Definitive Note in an amount equal to the
          beneficial interest to be transferred or exchanged and (2)
          instructions given by the Depositary to the Registrar containing
          information regarding the Person in whose name such Definitive Note
          shall be registered to effect the transfer or exchange referred to in
          (B)(1) above. Upon consummation of an Exchange Offer by the Company in
          accordance with Section 2.06(f) hereof, the requirements of this
          Section 2.06(b)(ii) shall be deemed to have been satisfied upon
          receipt by the Registrar of the instructions contained in the Letter
          of Transmittal delivered by the Holder of such beneficial interests in
          the Restricted Global Notes. Upon satisfaction of all of the
          requirements for transfer or exchange of beneficial interests in
          Global Notes contained in this Indenture and the Notes or otherwise
          applicable under the Securities Act, the Trustee shall adjust the
          principal amount of the relevant Global Note(s) pursuant to Section
          2.06(h) hereof.

                (iii) Transfer of Beneficial Interests in a Restricted Global
          Note to Another Restricted Global Note. A beneficial interest in any
          Restricted Global Note may be transferred to a Person who takes
          delivery thereof in the form of a beneficial interest in another
          Restricted Global Note if the transfer complies with the requirements
          of Section 2.06(b)(ii) above and the Registrar receives the following:

                    (A) if the transferee will take delivery in the form of a
                  beneficial interest in the 144A Global Note, then the
                  transferor must deliver a certificate in the form of Exhibit B
                  hereto, including the certifications in item (1) thereof;

                    (B) if the transferee will take delivery in the form of a
                  beneficial interest in the Regulation S Global Note, then the
                  transferor must deliver a certificate in the form of Exhibit B
                  hereto, including the certifications in item (2) thereof; and

                    (C) if the transferee will take delivery in the form of a
                  beneficial interest in the IAI Global Note, then the
                  transferor must deliver a certificate in the form of Exhibit B
                  hereto, including the certifications and certificates and
                  Opinion of Counsel required by item (3) thereof, if
                  applicable.

                (iv) Transfer and Exchange of Beneficial Interests in a
          Restricted Global Note for Beneficial Interests in an Unrestricted
          Global Note. A beneficial interest in any Restricted Global Note may
          be exchanged by any holder thereof for a beneficial interest in an
          Unrestricted Global Note or transferred to a Person who takes delivery
          thereof in the form of a beneficial interest in an Unrestricted Global
          Note if the exchange or transfer complies with the requirements of
          Section 2.06(b)(ii) above and:

                    (A) such exchange or transfer is effected pursuant to the
                  Exchange Offer in accordance with the Registration Rights
                  Agreement and the holder of the beneficial interest to be
                  transferred, in the case of an exchange, or the transferee, in
                  the case of a transfer, certifies in the applicable Letter of
                  Transmittal that it is not (1) a broker-dealer, (2) a Person
                  participating in the distribution of the Exchange Notes or (3)
                  a Person who is an affiliate (as defined in Rule 144) of the
                  Company;



                                       21


                    (B) such transfer is effected pursuant to the Shelf
                  Registration Statement in accordance with the Registration
                  Rights Agreement;

                    (C) such transfer is effected by a broker-dealer pursuant to
                  the Exchange Offer Registration Statement in accordance with
                  the Registration Rights Agreement; or

                    (D) the Registrar receives the following:

                    (1) if the holder of such beneficial interest in a
                  Restricted Global Note proposes to exchange such beneficial
                  interest for a beneficial interest in an Unrestricted Global
                  Note, a certificate from such holder in the form of Exhibit C
                  hereto, including the certifications in item (1)(a) thereof;
                  or

                    (2) if the holder of such beneficial interest in a
                  Restricted Global Note proposes to transfer such beneficial
                  interest to a Person who shall take delivery thereof in the
                  form of a beneficial interest in an Unrestricted Global Note,
                  a certificate from such holder in the form of Exhibit B
                  hereto, including the certifications in item (4) thereof;

                  and, in each such case set forth in this clause (D), if the
                  Registrar and the Company so requests or if the Applicable
                  Procedures so require, an Opinion of Counsel in form
                  reasonably acceptable to the Registrar to the effect that such
                  exchange or transfer is in compliance with the Securities Act
                  and that the restrictions on transfer contained herein and in
                  the Private Placement Legend are no longer required in order
                  to maintain compliance with the Securities Act.

                  If any such transfer is effected pursuant to clause (B) or (D)
above at a time when an Unrestricted Global Note has not yet been issued, the
Company shall issue and, upon receipt of an Authentication Order in accordance
with Section 2.02 hereof, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal to the
aggregate principal amount of beneficial interests transferred pursuant to
clause (B) or (D) above.

                (v) Transfer or Exchange of Beneficial Interests in Unrestricted
          Global Notes for Beneficial Interests in Restricted Global Notes
          Prohibited. Beneficial interests in an Unrestricted Global Note cannot
          be exchanged for, or transferred to Persons who take delivery thereof
          in the form of, a beneficial interest in a Restricted Global Note.

                (c) TRANSFER OR EXCHANGE OF BENEFICIAL INTERESTS FOR DEFINITIVE
          NOTES.

                (i) Beneficial Interests in Restricted Global Notes to
          Restricted Definitive Notes. If any holder of a beneficial interest in
          a Restricted Global Note proposes to exchange such beneficial interest
          for a Restricted Definitive Note or to transfer such beneficial
          interest to a Person who takes delivery thereof in the form of a
          Restricted Definitive Note, then, upon receipt by the Registrar of the
          following documentation:

                    (A) if the holder of such beneficial interest in a
                  Restricted Global Note proposes to exchange such beneficial
                  interest for a Restricted Definitive Note, a certificate from
                  such holder in the form of Exhibit C hereto, including the
                  certifications in item (2)(a) thereof;

                    (B) if such beneficial interest is being transferred to a
                  QIB in accordance with Rule 144A, a certificate to the effect
                  set forth in Exhibit B hereto, including the certifications in
                  item (1) thereof;

                    (C) if such beneficial interest is being transferred to a
                  Non-U.S. Person in an offshore transaction in accordance with
                  Rule 903 or Rule 904, a certificate



                                       22


                  to the effect set forth in Exhibit B hereto, including the
                  certifications in item (2) thereof;

                    (D) if such beneficial interest is being transferred
                  pursuant to an exemption from the registration requirements of
                  the Securities Act in accordance with Rule 144 under the
                  Securities Act, a certificate to the effect set forth in
                  Exhibit B hereto, including the certifications in item (3)(a)
                  thereof;

                    (E) if such beneficial interest is being transferred to an
                  Institutional Accredited Investor in reliance on an exemption
                  from the registration requirements of the Securities Act other
                  than those listed in clauses (B) through (D) above, a
                  certificate to the effect set forth in Exhibit B hereto,
                  including the certifications, certificates and Opinion of
                  Counsel required by item (3)(d) thereof, if applicable;

                    (F) if such beneficial interest is being transferred to the
                  Company or any of its Subsidiaries, a certificate to the
                  effect set forth in Exhibit B hereto, including the
                  certifications in item (3)(b) thereof; or

                    (G) if such beneficial interest is being transferred
                  pursuant to an effective registration statement under the
                  Securities Act, a certificate to the effect set forth in
                  Exhibit B hereto, including the certifications in item (3)(c)
                  thereof,

         the Trustee shall cause the aggregate principal amount of the
         applicable Global Note to be reduced accordingly pursuant to Section
         2.06(h) hereof, and the Company shall execute and the Trustee shall
         authenticate and deliver to the Person designated in the instructions a
         Definitive Note in the appropriate principal amount. Any Definitive
         Note issued in exchange for a beneficial interest in a Restricted
         Global Note pursuant to this Section 2.06(c) shall be registered in
         such name or names and in such authorized denomination or denominations
         as the holder of such beneficial interest shall instruct the Registrar
         through instructions from the Depositary and the Participant or
         Indirect Participant. The Trustee shall mail or deliver such Definitive
         Notes to the Persons in whose names such Notes are so registered. Any
         Definitive Note issued in exchange for a beneficial interest in a
         Restricted Global Note pursuant to this Section 2.06(c)(i) shall bear
         the Private Placement Legend and shall be subject to all restrictions
         on transfer contained therein.

                (ii) Beneficial Interests in Restricted Global Notes to
          Unrestricted Definitive Notes. A holder of a beneficial interest in a
          Restricted Global Note may exchange such beneficial interest for an
          Unrestricted Definitive Note or may transfer such beneficial interest
          to a Person who takes delivery thereof in the form of an Unrestricted
          Definitive Note only if:

                    (A) such exchange or transfer is effected pursuant to the
                  Exchange Offer in accordance with the Registration Rights
                  Agreement and the holder of such beneficial interest, in the
                  case of an exchange, or the transferee, in the case of a
                  transfer, certifies in the applicable Letter of Transmittal
                  that it is not (1) a broker-dealer, (2) a Person participating
                  in the distribution of the Exchange Notes or (3) a Person who
                  is an affiliate (as defined in Rule 144) of the Company;

                    (B) such transfer is effected pursuant to the Shelf
                  Registration Statement in accordance with the Registration
                  Rights Agreement;

                    (C) such transfer is effected by a broker-dealer pursuant to
                  the Exchange Offer Registration Statement in accordance with
                  the Registration Rights Agreement; or



                                       23


                    (D) the Registrar receives the following:

                    (1) if the holder of such beneficial interest in a
                  Restricted Global Note proposes to exchange such beneficial
                  interest for an Unrestricted Definitive Note, a certificate
                  from such holder in the form of Exhibit C hereto, including
                  the certifications in item (1)(b) thereof; or

                    (2) if the holder of such beneficial interest in a
                  Restricted Global Note proposes to transfer such beneficial
                  interest to a Person who shall take delivery thereof in the
                  form of an Unrestricted Definitive Note, a certificate from
                  such holder in the form of Exhibit B hereto, including the
                  certifications in item (4) thereof;

                  and, in each such case set forth in this clause (D), if the
                  Registrar so requests or if the Applicable Procedures so
                  require, an Opinion of Counsel in form reasonably acceptable
                  to the Registrar to the effect that such exchange or transfer
                  is in compliance with the Securities Act and that the
                  restrictions on transfer contained herein and in the Private
                  Placement Legend are no longer required in order to maintain
                  compliance with the Securities Act.

                (iii) Beneficial Interests in Unrestricted Global Notes to
          Unrestricted Definitive Notes. If any holder of a beneficial interest
          in an Unrestricted Global Note proposes to exchange such beneficial
          interest for a Definitive Note or to transfer such beneficial interest
          to a Person who takes delivery thereof in the form of a Definitive
          Note, then, upon satisfaction of the conditions set forth in Section
          2.06(b)(ii) hereof, the Trustee shall cause the aggregate principal
          amount of the applicable Global Note to be reduced accordingly
          pursuant to Section 2.06(h) hereof, and the Company shall execute and
          the Trustee shall authenticate and mail or deliver to the Person
          designated in the instructions a Definitive Note in the appropriate
          principal amount. Any Definitive Note issued in exchange for a
          beneficial interest pursuant to this Section 2.06(c)(iii) shall be
          registered in such name or names and in such authorized denomination
          or denominations as the holder of such beneficial interest shall
          instruct the Registrar through instructions from the Depositary and
          the Participant or Indirect Participant. The Trustee shall mail or
          deliver such Definitive Notes to the Persons in whose names such Notes
          are so registered. Any Definitive Note issued in exchange for a
          beneficial interest pursuant to this Section 2.06(c)(iii) shall not
          bear the Private Placement Legend.

                    (d) TRANSFER AND EXCHANGE OF DEFINITIVE NOTES FOR BENEFICIAL
                  INTERESTS.

                (i) Restricted Definitive Notes to Beneficial Interests in
          Restricted Global Notes. If any Holder of a Restricted Definitive Note
          proposes to exchange such Note for a beneficial interest in a
          Restricted Global Note or to transfer such Restricted Definitive Notes
          to a Person who takes delivery thereof in the form of a beneficial
          interest in a Restricted Global Note, then, upon receipt by the
          Registrar of the following documentation:

                    (A) if the Holder of such Restricted Definitive Note
                  proposes to exchange such Note for a beneficial interest in a
                  Restricted Global Note, a certificate from such Holder in the
                  form of Exhibit C hereto, including the certifications in item
                  (2)(b) thereof;

                    (B) if such Restricted Definitive Note is being transferred
                  to a QIB in accordance with Rule 144A, a certificate to the
                  effect set forth in Exhibit B hereto, including the
                  certifications in item (1) thereof;

                    (C) if such Restricted Definitive Note is being transferred
                  to a Non-U.S. Person in an offshore transaction in accordance
                  with Rule 903 or Rule 904, a certificate to the effect set
                  forth in Exhibit B hereto, including the certifications in
                  item (2) thereof;



                                       24


                    (D) if such Restricted Definitive Note is being transferred
                  pursuant to an exemption from the registration requirements of
                  the Securities Act in accordance with Rule 144, a certificate
                  to the effect set forth in Exhibit B hereto, including the
                  certifications in item (3)(a) thereof;

                    (E) if such Restricted Definitive Note is being transferred
                  to an Institutional Accredited Investor in reliance on an
                  exemption from the registration requirements of the Securities
                  Act other than those listed in clauses (B) through (D) above,
                  a certificate to the effect set forth in Exhibit B hereto,
                  including the certifications, certificates and Opinion of
                  Counsel required by item (3)(d) thereof, if applicable;

                    (F) if such Restricted Definitive Note is being transferred
                  to the Company or any of its Subsidiaries, a certificate to
                  the effect set forth in Exhibit B hereto, including the
                  certifications in item (3)(b) thereof; or

                    (G) if such Restricted Definitive Note is being transferred
                  pursuant to an effective registration statement under the
                  Securities Act, a certificate to the effect set forth in
                  Exhibit B hereto, including the certifications in item (3)(c)
                  thereof,

         the Trustee shall cancel the Restricted Definitive Note, increase or
         cause to be increased the aggregate principal amount of, in the case of
         clause (A) above, the appropriate Restricted Global Note, in the case
         of clause (B) above, the 144A Global Note, in the case of clause (C)
         above, the Regulation S Global Note, and in all other cases, the IAI
         Global Note.

                (ii) Restricted Definitive Notes to Beneficial Interests in
          Unrestricted Global Notes. A Holder of a Restricted Definitive Note
          may exchange such Note for a beneficial interest in an Unrestricted
          Global Note or transfer such Restricted Definitive Note to a Person
          who takes delivery thereof in the form of a beneficial interest in an
          Unrestricted Global Note only if:

                    (A) such exchange or transfer is effected pursuant to the
                  Exchange Offer in accordance with the Registration Rights
                  Agreement and the Holder, in the case of an exchange, or the
                  transferee, in the case of a transfer, certifies in the
                  applicable Letter of Transmittal that it is not (1) a
                  broker-dealer, (2) a Person participating in the distribution
                  of the Exchange Notes or (3) a Person who is an affiliate (as
                  defined in Rule 144) of the Company;

                    (B) such transfer is effected pursuant to the Shelf
                  Registration Statement in accordance with the Registration
                  Rights Agreement;

                    (C) such transfer is effected by a broker-dealer pursuant to
                  the Exchange Offer Registration Statement in accordance with
                  the Registration Rights Agreement; or

                    (D) the Registrar receives the following:

                    (1) if the Holder of such Definitive Notes proposes to
                  exchange such Notes for a beneficial interest in the
                  Unrestricted Global Note, a certificate from such Holder in
                  the form of Exhibit C hereto, including the certifications in
                  item (1)(c) thereof; or

                    (2) if the Holder of such Definitive Notes proposes to
                  transfer such Notes to a Person who shall take delivery
                  thereof in the form of a beneficial interest in the
                  Unrestricted Global Note, a certificate from such Holder in
                  the form of Exhibit B hereto, including the certifications in
                  item (4) thereof;



                                       25


                  and, in each such case set forth in this clause (D), if the
                  Registrar so requests or if the Applicable Procedures so
                  require, an Opinion of Counsel in form reasonably acceptable
                  to the Registrar to the effect that such exchange or transfer
                  is in compliance with the Securities Act and that the
                  restrictions on transfer contained herein and in the Private
                  Placement Legend are no longer required in order to maintain
                  compliance with the Securities Act.

                  Upon satisfaction of the conditions of any of the clauses in
         this Section 2.06(d)(ii), the Trustee shall cancel the Definitive Notes
         and increase or cause to be increased the aggregate principal amount of
         the Unrestricted Global Note.

                (iii) Unrestricted Definitive Notes to Beneficial Interests in
          Unrestricted Global Notes. A Holder of an Unrestricted Definitive Note
          may exchange such Note for a beneficial interest in an Unrestricted
          Global Note or transfer such Unrestricted Definitive Note to a Person
          who takes delivery thereof in the form of a beneficial interest in an
          Unrestricted Global Note at any time. Upon receipt of a request for
          such an exchange or transfer, the Trustee shall cancel the applicable
          Unrestricted Definitive Note and increase or cause to be increased the
          aggregate principal amount of one of the Unrestricted Global Notes.

                (iv) Transfer or Exchange of Unrestricted Definitive Notes to
          Beneficial Interests in Restricted Global Notes Prohibited. An
          Unrestricted Definitive Note cannot be exchanged for, or transferred
          to Persons who take delivery thereof in the form of, beneficial
          interests in a Restricted Global Note.

                (v) Issuance of Unrestricted Global Notes. If any such exchange
          or transfer from a Definitive Note to a beneficial interest is
          effected pursuant to clauses (ii)(B), (ii)(D) or (iii) above at a time
          when an Unrestricted Global Note has not yet been issued, the Company
          shall issue and, upon receipt of an Authentication Order in accordance
          with Section 2.02 hereof, the Trustee shall authenticate one or more
          Unrestricted Global Notes in an aggregate principal amount equal to
          the principal amount of Definitive Notes so transferred.

                  (e) TRANSFER AND EXCHANGE OF DEFINITIVE NOTES FOR DEFINITIVE
NOTES. Upon request by a Holder of Definitive Notes and such Holder's compliance
with the provisions of this Section 2.06(e), the Registrar shall register the
transfer or exchange of Definitive Notes. Prior to such registration of transfer
or exchange, the requesting Holder shall present or surrender to the Registrar
the Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such Holder or
by its attorney, duly authorized in writing. In addition, the requesting Holder
shall provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section
2.06(e).

                (i) Restricted Definitive Notes to Restricted Definitive Notes.
          Any Restricted Definitive Note may be transferred to and registered in
          the name of Persons who take delivery thereof in the form of a
          Restricted Definitive Note if the Registrar receives the following:

                    (A) if the transfer will be made pursuant to Rule 144A, then
                  the transferor must deliver a certificate in the form of
                  Exhibit B hereto, including the certifications in item (1)
                  thereof;

                    (B) if the transfer will be made pursuant to Rule 903 or
                  Rule 904, then the transferor must deliver a certificate in
                  the form of Exhibit B hereto, including the certifications in
                  item (2) thereof; and

                    (C) if the transfer will be made pursuant to any other
                  exemption from the registration requirements of the Securities
                  Act, then the transferor must deliver a certificate in the
                  form of Exhibit B hereto, including the certifications,
                  certificates and Opinion of Counsel required by item (3)
                  thereof, if applicable.



                                       26


                (ii) Restricted Definitive Notes to Unrestricted Definitive
          Notes. Any Restricted Definitive Note may be exchanged by the Holder
          thereof for an Unrestricted Definitive Note or transferred to a Person
          or Persons who take delivery thereof in the form of an Unrestricted
          Definitive Note if:

                    (A) such exchange or transfer is effected pursuant to the
                  Exchange Offer in accordance with the Registration Rights
                  Agreement and the Holder, in the case of an exchange, or the
                  transferee, in the case of a transfer, certifies in the
                  applicable Letter of Transmittal that it is not (1) a
                  broker-dealer, (2) a Person participating in the distribution
                  of the Exchange Notes or (3) a Person who is an affiliate (as
                  defined in Rule 144) of the Company;

                    (B) any such transfer is effected pursuant to the Shelf
                  Registration Statement in accordance with the Registration
                  Rights Agreement;

                    (C) any such transfer is effected by a broker-dealer
                  pursuant to the Exchange Offer Registration Statement in
                  accordance with the Registration Rights Agreement; or

                    (D) the Registrar receives the following:

                    (1) if the Holder of such Restricted Definitive Notes
                  proposes to exchange such Notes for an Unrestricted Definitive
                  Note, a certificate from such Holder in the form of Exhibit C
                  hereto, including the certifications in item (1)(d) thereof;
                  or

                    (2) if the Holder of such Restricted Definitive Notes
                  proposes to transfer such Notes to a Person who shall take
                  delivery thereof in the form of an Unrestricted Definitive
                  Note, a certificate from such Holder in the form of Exhibit B
                  hereto, including the certifications in item (4) thereof;

                  and, in each such case set forth in this clause (D), if the
                  Registrar so requests, an Opinion of Counsel in form
                  reasonably acceptable to the Registrar and the Company to the
                  effect that such exchange or transfer is in compliance with
                  the Securities Act and that the restrictions on transfer
                  contained herein and in the Private Placement Legend are no
                  longer required in order to maintain compliance with the
                  Securities Act.

                (iii) Unrestricted Definitive Notes to Unrestricted Definitive
          Notes. A Holder of Unrestricted Definitive Notes may transfer such
          Notes to a Person who takes delivery thereof in the form of an
          Unrestricted Definitive Note. Upon receipt of a request to register
          such a transfer, the Registrar shall register the Unrestricted
          Definitive Notes pursuant to the instructions from the Holder thereof.

                  (f) EXCHANGE OFFER. Upon the occurrence of the Exchange Offer
in accordance with the Registration Rights Agreement, the Company shall issue
and, upon receipt of an Authentication Order in accordance with Section 2.02,
the Trustee shall authenticate (A) one or more Unrestricted Global Notes in an
aggregate principal amount equal to the principal amount of the beneficial
interests in the Restricted Global Notes tendered for acceptance by Persons that
certify in the applicable Letters of Transmittal that (x) they are not
broker-dealers, (y) they are not participating in a distribution of the Exchange
Notes and (z) they are not affiliates (as defined in Rule 144) of the Company,
and accepted for exchange in the Exchange Offer and (B) Unrestricted Definitive
Notes in an aggregate principal amount equal to the principal amount of the
Restricted Definitive Notes tendered for acceptance by Persons who made the
foregoing certification and accepted for exchange in the Exchange Offer.
Concurrently with the issuance of such Notes, the Trustee shall cause the
aggregate principal amount of the applicable Restricted Global Notes to be
reduced accordingly, and the Company shall execute and the Trustee shall
authenticate and mail or deliver to the Persons designated by the Holders of
Restricted Definitive Notes so accepted Unrestricted Definitive Notes in the
appropriate principal amount.

                                       27


                  (g) LEGENDS. The following legends shall appear on the face of
all Global Notes and Definitive Notes issued under this Indenture unless
specifically stated otherwise in the applicable provisions of this Indenture.

                (i) Private Placement Legend.


                    (A) Except as permitted by clause (B) below, each Global
                  Note and each Definitive Note (and all Notes issued in
                  exchange therefor or substitution thereof) shall bear the
                  legend in substantially the following form:

                  THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED, IN THE ABSENCE OF SUCH
REGISTRATION UNLESS THE TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS NOTE BY ITS
ACCEPTANCE HEREOF (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL
BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS NOT A
U.S. PERSON AND IS ACQUIRING THIS NOTE IN AN "OFFSHORE TRANSACTION" PURSUANT TO
RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT
PRIOR TO (A) THE DATE WHICH IS TWO YEARS (OR SUCH SHORTER PERIOD OF TIME AS
PERMITTED BY RULE 144(k) UNDER THE SECURITIES ACT OR ANY SUCCESSOR PROVISION
THEREUNDER) AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR OF ANY
PREDECESSOR OF THIS NOTE) OR THE LAST DAY ON WHICH THE COMPANY OR ANY AFFILIATE
OF THE COMPANY WERE THE OWNERS OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE)
AND (B) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAW (THE
"RESALE RESTRICTION TERMINATION DATE"), OFFER, SELL OR OTHERWISE TRANSFER THIS
NOTE EXCEPT (I) TO THE COMPANY, (II) PURSUANT TO A REGISTRATION STATEMENT WHICH
HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (III) FOR SO LONG AS THE
NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY
BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING
MADE IN RELIANCE ON RULE 144A, (IV) PURSUANT TO OFFERS AND SALES TO NON-U.S.
PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S
UNDER THE SECURITIES ACT OR (V) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT IT WILL
GIVE TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO
THE EFFECT OF THIS LEGEND; PROVIDED THAT THE COMPANY, THE TRUSTEE, AND THE
REGISTRAR SHALL HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
PURSUANT TO CLAUSE (IV) OR (V) TO REQUIRE THAT AN OPINION OF COUNSEL,
CERTIFICATIONS AND/OR OTHER INFORMATION SATISFACTORY TO THE COMPANY, THE TRUSTEE
AND THE REGISTRAR IS COMPLETED AND DELIVERED BY THE TRANSFEROR. THIS LEGEND WILL
BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION
TERMINATION DATE. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED
STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER
THE SECURITIES ACT.

                    (B) Notwithstanding the foregoing, any Global Note or
                  Definitive Note issued pursuant to clauses (b)(iv), (c)(ii),
                  (c)(iii), (d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f) to this
                  Section 2.06 (and all Notes issued in exchange therefor or
                  substitution thereof) shall not bear the Private Placement
                  Legend.

                (ii) Global Note Legend. Each Global Note shall bear a legend in
          substantially the following form:


                  "THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE
BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY
CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY



                                       28


BE REQUIRED PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY
BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE
INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR
CANCELLATION PURSUANT TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE
MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF
THE COMPANY.

                  UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."

                  (h) CANCELLATION AND/OR ADJUSTMENT OF GLOBAL NOTES. At such
time as all beneficial interests in a particular Global Note have been exchanged
for Definitive Notes or a particular Global Note has been redeemed, repurchased
or cancelled in whole and not in part, each such Global Note shall be returned
to or retained and cancelled by the Trustee in accordance with Section 2.11
hereof. At any time prior to such cancellation, if any beneficial interest in a
Global Note is exchanged for or transferred to a Person who will take delivery
thereof in the form of a beneficial interest in another Global Note or for
Definitive Notes, the principal amount of Notes represented by such Global Note
shall be reduced accordingly and an endorsement shall be made on such Global
Note by the Trustee or by the Depositary at the direction of the Trustee to
reflect such reduction; and if the beneficial interest is being exchanged for or
transferred to a Person who will take delivery thereof in the form of a
beneficial interest in another Global Note, such other Global Note shall be
increased accordingly and an endorsement shall be made on such Global Note by
the Trustee or by the Depositary at the direction of the Trustee to reflect such
increase.

                (i) GENERAL PROVISIONS RELATING TO TRANSFERS AND EXCHANGES.

                (i) To permit registrations of transfers and exchanges, the
          Company shall execute and, upon receipt of an Authentication Order in
          accordance with Section 2.02, the Trustee shall authenticate Global
          Notes and Definitive Notes upon the Company's order or at the
          Registrar's request.

                (ii) No service charge shall be made to a Holder of a beneficial
          interest in a Global Note or to a Holder of a Definitive Note for any
          registration of transfer or exchange, but the Company may require
          payment of a sum sufficient to cover any transfer tax or similar
          governmental charge payable in connection therewith (other than any
          such transfer taxes or similar governmental charge payable upon
          exchange or transfer pursuant to Sections 2.10, 3.06, 4.12, 4.18 and
          9.05 hereof).

                (iii) All Global Notes and Definitive Notes issued upon any
          registration of transfer or exchange of Global Notes or Definitive
          Notes shall be the valid obligations of the Company, evidencing the
          same debt, and entitled to the same benefits under this Indenture, as
          the Global Notes or Definitive Notes surrendered upon such
          registration of transfer or exchange.

                (iv) Neither the Registrar nor the Company shall be required (A)
          to issue, to register the transfer of or to exchange any Notes during
          a period beginning at the opening of business 15 days before the day
          of any selection of Notes for redemption under Section 3.02 hereof and
          ending at the close of business on the day of selection, (B) to
          register the transfer of or to exchange any Note so selected for
          redemption in whole or in part, except the unredeemed portion of any
          Note being redeemed in part or (C) to register the transfer of or to
          exchange a Note between a record date and the next succeeding Interest
          Payment Date.

                (v) Prior to due presentment for the registration of a transfer
          of any Note, the Trustee, any Agent and the Company may deem and treat
          the Person in whose name any Note is registered as the absolute owner
          of such Note for the purpose of receiving payment of principal of and
          interest on such Notes and for



                                       29


          all other purposes, and none of the Trustee, any Agent or the Company
          shall be affected by notice to the contrary.

                (vi) The Trustee shall authenticate Global Notes and Definitive
          Notes in accordance with the provisions of Section 2.02 hereof.

                (vii) All certifications, certificates and Opinions of Counsel
          required to be submitted to the Registrar pursuant to this Section
          2.06 to effect a registration of transfer or exchange may be submitted
          by facsimile.

                (viii) The Trustee is hereby authorized to enter into a letter
          of representation with the Depositary in the form provided by the
          Company and to act in accordance with such letter.

Section 2.07.     REPLACEMENT NOTES.
                  -----------------

                  If any mutilated Note is surrendered to the Trustee or the
Company and the Trustee receives evidence to its satisfaction of the
destruction, loss or theft of any Note, the Company shall issue and the Trustee,
upon receipt of an Authentication Order, shall authenticate a replacement Note
if the Trustee's requirements are met. If required by the Trustee or the
Company, an indemnity bond must be supplied by the Holder that is sufficient in
the judgment of the Trustee and the Company to protect the Company, the Trustee,
any Agent and any authenticating agent from any loss that any of them may suffer
if a Note is replaced. The Company may charge for its expenses in replacing a
Note.

                  Every replacement Note is an additional obligation of the
Company and shall be entitled to all of the benefits of this Indenture equally
and proportionately with all other Notes duly issued hereunder.

Section 2.08.     OUTSTANDING NOTES.
                  -----------------

                  (a) The Notes outstanding at any time are all the Notes
authenticated by the Trustee except for those cancelled by it, those delivered
to it for cancellation, those reductions in the interest in a Global Note
effected by the Trustee in accordance with the provisions hereof, and those
described in this Section 2.08 as not outstanding. Except as set forth in
Section 2.09 hereof, a Note does not cease to be outstanding because the Company
or an Affiliate of the Company holds the Note; however, Notes held by the
Company or a Subsidiary of the Company shall not be deemed to be outstanding for
purposes of Section 3.07(b) hereof.

                  (b) If a Note is replaced pursuant to Section 2.07 hereof, it
ceases to be outstanding unless the Trustee receives proof satisfactory to it
that the replaced note is held by a bona fide purchaser.

                  (c) If the principal amount of any Note is considered paid
under Section 4.01 hereof, it ceases to be outstanding and interest on it ceases
to accrue.

                  (d) If the Paying Agent (other than the Company, a Subsidiary
or an Affiliate of any thereof) holds, on a redemption date or maturity date,
money sufficient to pay Notes payable on that date, then on and after that date
such Notes shall be deemed to be no longer outstanding and shall cease to accrue
interest.

Section 2.09.     TREASURY NOTES.
                  --------------

                  In determining whether the Holders of the required principal
amount of Notes have concurred in any direction, waiver or consent, Notes owned
by the Company, or by any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company, shall
be considered as though not outstanding, except that for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Notes that the Trustee knows are so owned
shall be so disregarded.



                                       30


Section 2.10.     TEMPORARY NOTES.
                  ---------------

                  Until certificates representing Notes are ready for delivery,
the Company may prepare and the Trustee, upon receipt of an Authentication
Order, shall authenticate temporary Notes. Temporary Notes shall be
substantially in the form of certificated Notes but may have variations that the
Company considers appropriate for temporary Notes and as shall be reasonably
acceptable to the Trustee. Without unreasonable delay, the Company shall prepare
and the Trustee shall authenticate Definitive Notes in exchange for temporary
Notes.

                  Holders of temporary Notes shall be entitled to all of the
benefits of this Indenture.

Section 2.11.     CANCELLATION.
                  ------------

                  The Company at any time may deliver Notes to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange or payment. The
Trustee upon direction by the Company and no one else shall cancel all Notes
surrendered for registration of transfer, exchange, payment, replacement or
cancellation and shall destroy cancelled Notes (subject to the record retention
requirements of the Exchange Act). Certification of the destruction of all
cancelled Notes shall be delivered to the Company. The Company may not issue new
Notes to replace Notes that it has paid or that have been delivered to the
Trustee for cancellation.

Section 2.12.     DEFAULTED INTEREST.
                  ------------------

                  If the Company defaults in a payment of interest or Additional
Interest, if any, on the Notes, it shall pay the defaulted interest in any
lawful manner plus, to the extent lawful, interest payable on the defaulted
interest, to the Persons who are Holders on a subsequent special record date, in
each case at the rate provided in the Notes and in Section 4.01 hereof. The
Company shall notify the Trustee in writing of the amount of defaulted interest
proposed to be paid on each Note and the date of the proposed payment. The
Company shall fix or cause to be fixed each such special record date and payment
date, provided that no such special record date shall be less than 10 days prior
to the related payment date for such defaulted interest. At least 15 days before
the special record date, the Company (or, upon the written request of the
Company, the Trustee in the name and at the expense of the Company) shall mail
or cause to be mailed to Holders a notice that states the special record date,
the related payment date and the amount of such interest to be paid.

Section 2.13.     CUSIP OR ISIN NUMBERS.
                  ---------------------

                  The Company in issuing the Notes may use "CUSIP" or "ISIN"
numbers (if then generally in use), and, if so, the Trustee shall use "CUSIP" or
"ISIN" numbers in notices of redemption as a convenience to Holders; provided,
however, that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Notes or as contained in
any notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Notes, and any such redemption shall not
be affected by any defect in or omission of such numbers. The Company will
promptly notify the Trustee of any change in the "CUSIP" or "ISIN" numbers.

Section 2.14.     ADDITIONAL INTEREST.
                  -------------------

                  If Additional Interest is payable by the Company pursuant to
the Registration Rights Agreement and paragraph 1 of the Notes, the Company
shall deliver to the Trustee a certificate to that effect stating (i) the amount
of such Additional Interest that is payable and (ii) the date on which such
interest is payable. Unless and until a Responsible Officer of the Trustee
receives such a certificate or instruction or direction from the Holders in
accordance with the terms of the Indenture, the Trustee may assume without
inquiry that no Additional Interest is payable. The foregoing shall not
prejudice the rights of the Holders with respect to their entitlement to
Additional Interest as otherwise set forth in this Indenture or the Notes and
pursuing any action against the Company directly or otherwise directing the
Trustee to take any such action in accordance with the terms of this Indenture
and the Notes. If the Company has paid Additional Interest directly to the
persons entitled to it, the Company shall deliver to the Trustee a certificate
setting forth the particulars of such payment.



                                       31


                                   ARTICLE 3.

                            REDEMPTION AND PREPAYMENT

Section 3.01.     NOTICES TO TRUSTEE.
                  ------------------

                  If the Company elects to redeem Notes pursuant to the optional
redemption provisions of Section 3.07 hereof, it shall furnish to the Trustee,
at least 45 days but not more than 60 days before a redemption date, an
Officers' Certificate setting forth (i) the clause of this Indenture pursuant to
which the redemption shall occur, (ii) the redemption date, (iii) the principal
amount of Notes to be redeemed and (iv) the redemption price.

Section 3.02.     SELECTION OF NOTES TO BE REDEEMED.
                  ---------------------------------

                  If less than all of the Notes are to be redeemed at any time,
the Trustee shall select the Notes to be redeemed among the Holders of the Notes
in compliance with the requirements of the principal national securities
exchange, if any, on which the Notes are listed or, if the Notes are not so
listed, on a pro rata basis, by lot or in accordance with any other method the
Trustee considers fair and appropriate. In the event of partial redemption by
lot, the particular Notes to be redeemed shall be selected, unless otherwise
provided herein, not less than 30 nor more than 60 days prior to the redemption
date by the Trustee from the outstanding Notes not previously called for
redemption.

                  The Trustee shall promptly notify the Company in writing of
the Notes selected for redemption and, in the case of any Note selected for
partial redemption, the principal amount thereof to be redeemed. Notes and
portions of Notes selected shall be in amounts of $1,000 or whole multiples of
$1,000; except that if all of the Notes of a Holder are to be redeemed, the
entire outstanding amount of Notes held by such Holder, even if not a multiple
of $1,000, shall be redeemed. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.

Section 3.03.     NOTICE OF REDEMPTION.
                  --------------------

                  At least 30 days but not more than 60 days before a redemption
date, the Company shall mail or cause to be mailed, by first class mail, a
notice of redemption to each Holder whose Notes are to be redeemed at its
registered address, except that redemption notices may be mailed more than 60
days prior to a redemption date if the notice is issued in connection with a
defeasance of the Notes pursuant to Article 8 hereof or a satisfaction and
discharge of this Indenture pursuant to Article 11.

                  The notice shall identify the Notes to be redeemed and shall
state:

                  (a) the redemption date;

                  (b) the redemption price or if the redemption is made pursuant
to Section 3.07(b) a calculation of the redemption price;

                  (c) if any Note is being redeemed in part, the portion of the
principal amount of such Note to be redeemed and that, after the redemption date
upon surrender of such Note, a new Note or Notes in principal amount equal to
the unredeemed portion shall be issued upon cancellation of the original Note;

                  (d) the name and address of the Paying Agent;

                  (e) that Notes called for redemption must be surrendered to
the Paying Agent to collect the redemption price;

                  (f) that, unless the Company defaults in making such
redemption payment, interest and Additional Interest, if any, on Notes called
for redemption ceases to accrue on and after the redemption date;



                                       32


                  (g) the paragraph of the Notes or Section of this Indenture
pursuant to which the Notes called for redemption are being redeemed; and

                  (h) that no representation is made as to the correctness or
accuracy of the CUSIP number, if any, listed in such notice or printed on the
Notes.

                  At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at its expense; provided, however, that the
Company shall have delivered to the Trustee, at least 45 days, or such shorter
period allowed by the Trustee, prior to the redemption date, an Officers'
Certificate requesting that the Trustee give such notice and setting forth the
information to be stated in such notice as provided in this Section 3.03.

Section 3.04.     EFFECT OF NOTICE OF REDEMPTION.
                  ------------------------------

                  Once notice of redemption is mailed in accordance with Section
3.03 hereof, Notes called for redemption become irrevocably due and payable on
the redemption date at the redemption price. A notice of redemption may not be
conditional.

Section 3.05.     DEPOSIT OF REDEMPTION PRICE.
                  ---------------------------

                  On or before 11:00 a.m. on any redemption date, the Company
shall deposit with the Trustee or with the Paying Agent money sufficient to pay
the redemption price of and accrued interest and Additional Interest, if any, on
all Notes to be redeemed on that date. The Trustee or the Paying Agent shall
promptly return to the Company any money deposited with the Trustee or the
Paying Agent by the Company in excess of the amounts necessary to pay the
redemption price of, and accrued interest and Additional Interest, if any, on,
all Notes to be redeemed.

                  If the Company complies with the provisions of the preceding
paragraph, on and after the redemption date, interest and Additional Interest,
if any, shall cease to accrue on the Notes or the portions of Notes called for
redemption. If a Note is redeemed on or after an interest record date but on or
prior to the related Interest Payment Date, then any accrued and unpaid interest
shall be paid to the Person in whose name such Note was registered at the close
of business on such record date. If any Note called for redemption shall not be
so paid upon surrender for redemption because of the failure of the Company to
comply with the preceding paragraph, interest and Additional Interest, if any,
shall be paid on the unpaid principal from the redemption date until such
principal is paid, and to the extent lawful on any interest not paid on such
unpaid principal, in each case at the rate provided in the Notes and in Section
4.01 hereof.

Section 3.06.     NOTES REDEEMED IN PART.
                  ----------------------

                  Upon surrender of a Note that is redeemed in part, the Company
shall issue and, upon the Company's written request, the Trustee shall
authenticate for the Holder at the expense of the Company a new Note equal in
principal amount to the unredeemed portion of the Note surrendered.

Section 3.07.     OPTIONAL REDEMPTION.
                  -------------------

                  (a) Except as set forth in clause (b) of this Section 3.07,
the Notes will not be redeemable at the option of the Company prior to July 1,
2006. Starting on July 1, 2006, the Company may redeem all or a part of the
Notes after giving the required notice under this Indenture. The Notes may be
redeemed at the redemption prices (expressed as percentages of principal amount)
set forth below, plus accrued and unpaid interest and Additional Interest, if
any, on the Notes redeemed, to the applicable redemption date (subject to the
right of Holders on the relevant record date to receive interest due on the
relevant Interest Payment Date), if redeemed during the twelve-month period
beginning on July 1 of the years indicated below:



                                       33




                                                                
         Year                                                       Percentage
         ----                                                       ----------
         2006.......................................................104.750%
         2007.......................................................102.375%
         2008 and thereafter........................................100.000%


                  (b) At any time and from time to time prior to July 1, 2005,
the Company may redeem up to 35% of the aggregate principal amount of the Notes
issued under this Indenture at a redemption price equal to 109.500% of the
principal amount thereof, plus accrued and unpaid interest and Additional
Interest, if any, to the redemption date (subject to the right of Holders of
record on the relevant record date to receive interest due on the relevant
Interest Payment Date) with the net cash proceeds of any Qualified Equity
Offering of the Company's common stock; provided, however, that after giving
effect to any such redemption, at least 65% of the aggregate principal amount of
the Notes issued under this Indenture (excluding Notes held by the Company and
its Subsidiaries) remains outstanding immediately after the occurrence of such
redemption. Any such redemption shall be made within 90 days of the closing of
such Qualified Equity Offering.

                  (c) Any prepayment pursuant to this Section 3.07 shall be made
pursuant to the provisions of Sections 3.01 through 3.06 hereof.

Section 3.08.     MANDATORY REDEMPTION.
                  --------------------

                  The Company shall not be required to make mandatory redemption
or sinking fund payments with respect to the Notes.

Section 3.09.     OFFER TO PURCHASE BY APPLICATION OF EXCESS PROCEEDS

                  (a) In the event that, pursuant to Section 4.12 hereof, the
Issuer shall be required to commence an offer to all Holders to purchase Notes
(an "ASSET SALE OFFER"), it shall follow the procedures specified below.

                  (b) The Asset Sale Offer shall remain open for a period of 20
Business Days following its commencement and no longer, except to the extent
that a longer period is required by applicable law (the "OFFER PERIOD"). No
later than five Business Days after the termination of the Offer Period (the
"PURCHASE DATE"), the Issuer shall purchase the principal amount of Notes
required to be purchased pursuant to Section 4.12 hereof (the "OFFER AMOUNT")
or, if less than the Offer Amount has been tendered, all Notes tendered in
response to the Asset Sale Offer. Payment for any Notes so purchased shall be
made in the same manner as interest payments are made.

                  If the Purchase Date is on or after an interest record date
and on or before the related Interest Payment Date, any accrued and unpaid
interest shall be paid to the Person in whose name a Note is registered at the
close of business on such record date, and no additional interest shall be
payable to Holders who tender Notes pursuant to the Asset Sale Offer.

                  Upon the commencement of the Asset Sale Offer, the Issuer
shall send, by first class mail, a notice to the Trustee and each of the
Holders, with a copy to the Trustee. The notice shall contain all instructions
and materials necessary to enable such Holders to tender Notes pursuant to the
Asset Sale Offer. The Asset Offer shall be made to all Holders. The notice,
which shall govern the terms of the Asset Sale Offer, shall state:

                (i) that the Asset Sale Offer is being made pursuant to this
          Section 3.09 and Section 4.12 hereof and the length of time the Asset
          Sale Offer shall remain open;

                (ii) the Offer Amount, the purchase price and the Purchase Date;

                (iii) that any Note not tendered or accepted for payment shall
          continue to accrue interest;

                (iv) that, unless the Issuer defaults in making such payment,
          any Note accepted for payment pursuant to the Asset Sale Offer shall
          cease to accrue interest and Additional Interest, if any, after the
          Purchase Date;



                                       34


                (v) that Holders electing to have a Note purchased pursuant to
          an Asset Sale Offer may elect to have Notes purchased in integral
          multiples of $1,000 only;

                (vi) that Holders electing to have a Note purchased pursuant to
          any Asset Sale Offer shall be required to surrender the Note, with the
          form entitled "Option of Holder to Elect Purchase" on the reverse of
          the Note completed, or transfer by book-entry transfer, to the Issuer,
          a depositary, if appointed by the Issuer, or a Paying Agent at the
          address specified in the notice at least three days before the
          Purchase Date;

                (vii) that Holders shall be entitled to withdraw their election
          if the Issuer, the depositary or the Paying Agent, as the case may be,
          receives, not later than the expiration of the Offer Period, a
          telegram, facsimile transmission or letter setting forth the name of
          the Holder, the principal amount of the Note the Holder delivered for
          purchase and a statement that such Holder is withdrawing his election
          to have such Note purchased;

                (viii) that, if the aggregate principal amount of Notes
          surrendered by Holders exceeds the Offer Amount, the Issuer shall
          select the Notes to be purchased on a pro rata basis (with such
          adjustments as may be deemed appropriate by the Issuer so that only
          Notes in denominations of $1,000 or integral multiples thereof shall
          be purchased); and

                (ix) that Holders whose Notes were purchased only in part shall
          be issued new Notes equal in principal amount to the unpurchased
          portion of the Notes surrendered (or transferred by book-entry
          transfer).

                  On or before the Purchase Date, the Issuer shall, to the
extent lawful, accept for payment, on a pro rata basis to the extent necessary,
the Offer Amount of Notes or portions thereof tendered pursuant to the Asset
Sale Offer, or if less than the Offer Amount has been tendered, all Notes
tendered, and shall deliver to the Trustee an Officers' Certificate stating that
such Notes or portions thereof were accepted for payment by the Issuer in
accordance with the terms of this Section 3.09. The Issuer, the Depositary or
the Paying Agent, as the case may be, shall promptly (but in any case not later
than five Business Days after the Purchase Date) mail or deliver to each
tendering Holder an amount equal to the purchase price of the Notes tendered by
such Holder and accepted by the Issuer for purchase, and the Issuer shall
promptly issue a new Note, and the Trustee, upon written request from the Issuer
shall authenticate and mail or deliver such new Note to such Holder, in a
principal amount equal to any unpurchased portion of the Note surrendered. Any
Note not so accepted shall be promptly mailed or delivered by the Issuer to the
Holder thereof. The Issuer shall publicly announce the results of the Asset Sale
Offer on the Purchase Date.

                  Other than as specifically provided in this Section 3.09, any
purchase pursuant to this Section 3.09 shall be made pursuant to the provisions
of Section 3.01 through 3.06 hereof.

                                   ARTICLE 4.

                                   COVENANTS

Section 4.01.     PAYMENT OF NOTES.
                  ----------------

                  The Company shall pay or cause to be paid the principal of,
premium, if any, and interest on the Notes on the dates and in the manner
provided in the Notes. Principal, premium, if any, and interest and Additional
Interest, if any, shall be considered paid on the date due if the Paying Agent,
if other than the Company or a Subsidiary thereof, holds as of 11:00 a.m.
Eastern Time on the due date money deposited by the Company in immediately
available funds and designated for and sufficient to pay all principal, premium,
if any, and interest and Additional Interest, if any, then due. The Company
shall pay Additional Interest, if any, in the same manner, on the dates and in
the amounts set forth in the Registration Rights Agreement.

                  The Company shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal and
premium, if any, from time to time on demand at a rate that is 1% per



                                       35


annum in excess of the rate then in effect; it shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
installments of interest and Additional Interest, if any, (without regard to any
applicable grace periods) from time to time on demand at the same rate to the
extent lawful.

                  Interest shall be computed on the basis of a 360-day year of
twelve 30-day months.

Section 4.02.     MAINTENANCE OF OFFICE OR AGENCY.
                  -------------------------------

                  (a) The Company shall maintain an office or agency (which may
be an office or drop facility of the Trustee or an affiliate of the Trustee,
Registrar or co-registrar) where Notes may be presented or surrendered for
registration of transfer or for exchange and where notices and demands to or
upon the Company in respect of the Notes and this Indenture may be served. The
Company shall give prompt written notice to the Trustee of the location, and any
change in the location, of such office or agency. If at any time the Company
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee, and the Company hereby appoints the Trustee as its agent to receive all
such presentations, surrenders, notices and demands.

                  (b) The Company may also from time to time designate one or
more other offices or agencies where the Notes may be presented or surrendered
for any or all such purposes and may from time to time rescind such
designations. The Company shall give prompt written notice to the Trustee of any
such designation or rescission and of any change in the location of any such
other office or agency.

                  (c) The Company hereby designates the Corporate Trust Office
of the Trustee, as one such office, drop facility or agency of the Company in
accordance with Section 2.03.

Section 4.03.     REPORTS.
                  -------

                  (a) Notwithstanding that the Company may not be subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act, so long as
any Notes are outstanding the Company shall furnish to the Holders of the Notes,
within the time periods specified in the SEC's rules and regulations:

                (i) all quarterly and annual financial information that would be
          required to be contained in a filing with the SEC on Forms 10-Q and
          10-K if the Company were required to file such Forms, including a
          "Management's Discussion and Analysis of Financial Condition and
          Results of Operations" and, with respect to the annual information
          only, a report on the annual financial statements by the Company's
          certified independent accountants; and

                (ii) all current reports that would be required to be filed with
          the SEC on Form 8-K if the Company were required to file such reports.

                  (b) If the Company has designated any of its Subsidiaries as
Unrestricted Subsidiaries, then the quarterly and annual financial information
required by the preceding clause (a) will include a reasonably detailed
presentation, either on the face of the financial statements or in the footnotes
thereto, and in Management's Discussion and Analysis of Financial Condition and
Results of Operations, of the financial condition and results of operations of
the Company and its Restricted Subsidiaries separate from the financial
condition and results of operations of the Company's Unrestricted Subsidiaries.

                  (c) In addition, following the consummation of the Exchange
Offer contemplated by the Registration Rights Agreement, whether or not required
by the SEC, the Company shall file a copy of all of the information and reports
referred to in clauses (a)(i) and (a)(ii) above with the SEC for public
availability within the time periods specified in the SEC's rules and
regulations (unless the SEC will not accept such a filing) and make such
information available to securities analysts and prospective investors upon
request.



                                       36


                  (d) For so long as any Notes remain outstanding, the Company
shall furnish to the Holders and to securities analysts and prospective
investors, upon their request, the information required to be delivered pursuant
to Rule 144A(d)(4) under the Securities Act.

Section 4.04.     COMPLIANCE CERTIFICATE.
                  ----------------------

                  (a) The Company shall deliver to the Trustee, within 90 days
after the end of each fiscal year, an Officers' Certificate stating that a
review of the activities of the Company and its Subsidiaries during the
preceding fiscal year has been made under the supervision of the signing
Officers with a view to determining whether the Company has kept, observed,
performed and fulfilled its obligations under this Indenture, and further
stating, as to each such Officer signing such certificate, that to the best of
his or her knowledge the Company has kept, observed, performed and fulfilled
each and every covenant contained in this Indenture and is not in default in the
performance or observance of any of the terms, provisions and conditions of this
Indenture (or, if a Default or Event of Default shall have occurred, describing
all such Defaults or Events of Default of which he or she may have knowledge and
what action the Company is taking or proposes to take with respect thereto) and
that to the best of his or her knowledge no event has occurred and remains in
existence by reason of which payments on account of the principal of or
interest, if any, on the Notes is prohibited or if such event has occurred, a
description of the event and what action the Company is taking or proposes to
take with respect thereto.

                  (b) So long as not contrary to the then current
recommendations of the American Institute of Certified Public Accountants, the
year-end financial statements delivered to the Trustee pursuant to Section 4.03
above shall be accompanied by a written statement of the Company's independent
public accountants (who shall be a firm of established national reputation) that
in making the examination necessary for certification of such financial
statements, nothing has come to their attention that would lead them to believe
that the Company has violated any provisions of Articles 4 or 5 hereof or, if
any such violation has occurred, specifying the nature and period of existence
thereof, it being understood that such accountants shall not be liable directly
or indirectly to any Person for any failure to obtain knowledge of any such
violation.

                  (c) The Company shall deliver to the Trustee, within 30 days
after the occurrence thereof, written notice in the form of an Officers'
Certificate of any event that with the giving of notice and the lapse of time
would become an Event of Default, its status and what action the Company is
taking or proposes to take with respect thereto.

Section 4.05.     TAXES.
                  -----

                  The Company shall pay, and shall cause each of its Restricted
Subsidiaries to pay, prior to delinquency, all material taxes, assessments, and
governmental levies except such as are contested in good faith and by
appropriate proceedings or where the failure to effect such payment is not
adverse in any material respect to the Holders of the Notes; provided that
neither the Company nor any such Restricted Subsidiary shall be required to pay
or discharge, or cause to be paid or discharged, any such tax, assessment,
charge or claim the amount, applicability or validity of which is being
contested in good faith by appropriate proceedings and for which adequate
reserves have been established in accordance with GAAP.

Section 4.06.     STAY, EXTENSION AND USURY LAWS.
                  ------------------------------

                  The Company covenants (to the extent that it may lawfully do
so) that it shall not at any time insist upon, plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay, extension or
usury law wherever enacted, now or at any time hereafter in force, that may
affect the covenants or the performance of this Indenture; and the Company (to
the extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and covenants that it shall not, by resort to any
such law, hinder, delay or impede the execution of any power herein granted to
the Trustee, but shall suffer and permit the execution of every such power as
though no such law has been enacted.



                                       37


Section 4.07.     CORPORATE EXISTENCE.
                  -------------------

                  Subject to Article 5 hereof, the Company shall do or cause to
be done all things necessary to preserve and keep in full force and effect (i)
its corporate existence, and the corporate, partnership or other existence of
each of its Restricted Subsidiaries, in accordance with the respective
organizational documents (as the same may be amended from time to time) of the
Company or any such Restricted Subsidiary and (ii) the rights (charter and
statutory), licenses and franchises of the Company and its Restricted
Subsidiaries; provided, however, that the Company shall not be required to
preserve any such right, license or franchise, or the corporate, partnership or
other existence of any of its Restricted Subsidiaries, if the Board of Directors
shall determine that the preservation thereof is no longer desirable in the
conduct of the business of the Company and its Restricted Subsidiaries, taken as
a whole, and that the loss thereof is not adverse in any material respect to the
Holders of the Notes.

Section 4.08.     PAYMENTS FOR CONSENT.
                  --------------------

                  The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to or for the
benefit of any Holder for or as an inducement to any consent, waiver or
amendment of any of the terms or provisions of this Indenture or the Notes
unless such consideration is offered to be paid or is paid to all Holders that
consent, waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or agreement.

Section 4.09.     INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF PREFERRED STOCK.
                  ----------------------------------------------------------

                  (a) The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, create, incur, issue,
assume, guarantee or otherwise become directly or indirectly liable,
contingently or otherwise, with respect to (collectively, "INCUR") any
Indebtedness (including any Acquired Debt), and the Company shall not issue any
Disqualified Stock and shall not permit any of its Restricted Subsidiaries to
issue any shares of preferred stock; provided, however, that the Company may
incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and
any of the Subsidiary Guarantors may incur Indebtedness, if the Fixed Charge
Coverage Ratio for the Company's most recently ended four full fiscal quarters
for which internal financial statements are available immediately preceding the
date on which such additional Indebtedness is incurred or such Disqualified
Stock is issued would have been at least 2.00 to 1, determined on a pro forma
basis (including a pro forma application of the net proceeds therefrom), as if
the additional Indebtedness had been incurred or the preferred stock or
Disqualified Stock had been issued, as the case may be, at the beginning of such
four-quarter period.

                  (b) Paragraph (a) of this Section 4.09 will not prohibit the
incurrence of any of the following items of Indebtedness (collectively,
"PERMITTED DEBT"):

                (i) the incurrence by the Company of additional Indebtedness and
          letters of credit under one or more Credit Facilities and Guarantees
          thereof by the Subsidiary Guarantors; provided that the aggregate
          principal amount of all Indebtedness of the Company and its Restricted
          Subsidiaries incurred pursuant to this clause (i) (with letters of
          credit being deemed to have a principal amount equal to the maximum
          potential liability of the Company and the Subsidiary Guarantors
          thereunder) does not exceed an amount equal to $105.0 million less (A)
          50% of all proceeds received from Securitization Transactions and (B)
          the aggregate amount of Net Proceeds from an Asset Sale applied by the
          Company and its Restricted Subsidiaries since the date hereof to repay
          Indebtedness thereunder or to permanently reduce the availability of
          revolving credit Indebtedness pursuant to Section 4.12;

                (ii) the incurrence by the Company and its Restricted
          Subsidiaries of the Existing Indebtedness;

                (iii) the incurrence by the Company of Indebtedness represented
          by the Notes to be issued on the date hereof (and the related Exchange
          Notes to be issued pursuant to the Registration Rights Agreement) and
          the incurrence by the Subsidiary Guarantors of the Subsidiary
          Guarantees of the Notes (and the related Exchange Notes);



                                       38


                (iv) the incurrence by the Company or any of the Subsidiary
          Guarantors of Indebtedness represented by Capital Lease Obligations,
          mortgage financings or purchase money obligations, in each case
          incurred for the purpose of financing all or any part of the purchase
          price or cost of construction or improvement of property, plant or
          equipment used in the Company's business or the business of such
          Subsidiary Guarantor, in an aggregate principal amount, including all
          Permitted Refinancing Indebtedness incurred to refund, refinance or
          replace any Indebtedness incurred pursuant to this clause (iv), not to
          exceed 3.5% of Consolidated Tangible Assets at any time outstanding;

                (v) the incurrence by the Company or any of its Restricted
          Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or
          the net proceeds of which are used to refund, refinance or replace
          Indebtedness (other than intercompany Indebtedness) that was incurred
          under clause (a) of this Section 4.09 or clauses (ii), (iii), (iv) or
          (x) of this Section 4.09(b);

                (vi) the incurrence by the Company or any of its Restricted
          Subsidiaries of intercompany Indebtedness owed to the Company or any
          of the Subsidiary Guarantors; provided, however, that:

                    (A) if the Company is the obligor on such Indebtedness, such
                  Indebtedness must be expressly subordinated to the prior
                  payment in full in cash of all Obligations with respect to the
                  Notes;

                    (B) if a Subsidiary Guarantor is the obligor on such
                  Indebtedness, such Indebtedness is expressly subordinated to
                  the prior payment in full in cash of such Subsidiary
                  Guarantor's Subsidiary Guarantee; and

                    (C) (1) any subsequent issuance or transfer of Equity
                  Interests that results in any such Indebtedness being held by
                  a Person other than the Company or a Subsidiary Guarantor and
                  (2) any sale or other transfer of any such Indebtedness to a
                  Person that is not either the Company or a Subsidiary
                  Guarantor shall be deemed, in each case, to constitute an
                  incurrence of such Indebtedness by the Company or such
                  Subsidiary Guarantor, as the case may be, that was not
                  permitted by this clause (vi);

                (vii) the incurrence by the Company or any of its Restricted
          Subsidiaries of Hedging Obligations that are incurred in the normal
          course of business for the purpose of fixing or hedging currency,
          commodity or interest rate risk (including with respect to any
          floating rate Indebtedness that is permitted by the terms hereof to be
          outstanding in connection with the conduct of the Company's respective
          businesses and not for speculative purposes);

                (viii) the guarantee by the Company or any of the Subsidiary
          Guarantors of Indebtedness of the Company or of one of its Restricted
          Subsidiaries that was permitted to be incurred by another provision of
          this covenant;

                (ix) the incurrence by the Company's Unrestricted Subsidiaries
          of Non-recourse Debt; provided, however, that if any such Indebtedness
          ceases to be Non-recourse Debt of an Unrestricted Subsidiary, such
          event shall be deemed to be an incurrence of Indebtedness by a
          Restricted Subsidiary of the Company that was not permitted by this
          clause (ix); and

                (x) the incurrence by the Company or any of its Restricted
          Subsidiaries of additional Indebtedness in an aggregate principal
          amount (or accreted value, as applicable) at any time outstanding,
          including all Permitted Refinancing Indebtedness incurred to refund,
          refinance or replace any Indebtedness incurred pursuant to this clause
          (x), not to exceed $25.0 million (which amount may be incurred, in
          whole or in part, under any of the Credit Facilities); provided that
          no more than $10.0 million of such additional Indebtedness shall be
          incurred by Restricted Subsidiaries that are not Subsidiary
          Guarantors.



                                       39


                  (c) For purposes of determining compliance with this Section
4.09, in the event that an item of proposed Indebtedness meets the criteria of
more than one of the categories of Permitted Debt described in clauses (i)
through (x) of Section 4.09(b) as of the date of incurrence thereof or is
entitled to be incurred pursuant to clause (a) of this Section 4.09, the Company
shall, in its sole discretion, at the time the proposed Indebtedness is
incurred, (x) classify all or a portion of that item of Indebtedness on the date
of its incurrence under either the clause (a) of this Section 4.09 or under any
category of Permitted Debt, (y) reclassify at a later date all or a portion of
that or any other item of Indebtedness as being or having been incurred in any
manner that complies with this Section 4.09 and (z) elect to comply with this
Section 4.09 and the applicable definitions in any order.

                  (d) The Company shall not incur, create, issue, assume,
guarantee or otherwise become liable for any Indebtedness that is subordinate or
junior in right of payment to any Senior Debt of the Company and not subordinate
or junior in right of payment to the Notes; provided, however, that no
Indebtedness of the Company will be deemed to be contractually subordinated in
right of payment solely by virtue of being unsecured. No Subsidiary Guarantor
will incur, create, issue, assume, guarantee or otherwise become liable for any
Indebtedness that is subordinate or junior in right of payment to the Senior
Debt of such Subsidiary Guarantor and not subordinate or junior in right of
payment to such Subsidiary Guarantor's Subsidiary Guarantee; provided, however,
that no Indebtedness of a Subsidiary Guarantor will be deemed to be
contractually subordinated in right of payment solely by virtue of being
unsecured.

                  (e) Indebtedness shall be deemed to have been incurred by the
survivor of a merger, at the time of such merger and, with respect to an
acquired Subsidiary, at the time of such acquisition.

Section 4.10.     RESTRICTED PAYMENTS.
                  -------------------

                  The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly:

                  (a) declare or pay any dividend or make any other payment or
distribution on account of the Company's Equity Interests (including, without
limitation, any payment in connection with any merger or consolidation involving
the Company) or to the direct or indirect holders of the Company's Equity
Interests in their capacity as such (other than dividends or distributions
payable solely in the Company's Equity Interests (other than Disqualified Stock)
or to the Company);

                  (b) purchase, redeem or otherwise acquire or retire for value
(including, without limitation, in connection with any merger or consolidation
involving the Company) any of the Company's Equity Interests;

                  (c) make any payment on or with respect to, or purchase,
redeem, defease or otherwise acquire or retire for value any Subordinated
Indebtedness, except (i) a payment of interest or principal at the Stated
Maturity thereof or (ii) Subordinated Indebtedness acquired in anticipation of
satisfying a sinking fund obligation, principal installment or payment of
principal upon final maturity of such Subordinated Indebtedness, in each case
acquired within one year of the date of the sinking fund obligation, principal
installment or payment of principal upon maturity; or

                  (d) make any Restricted Investment,

(all such payments and other actions set forth in these clauses (a) through (d)
above being collectively referred to as "RESTRICTED PAYMENTS"), unless, at the
time of and after giving effect to such Restricted Payment:

                  (a) no Default or Event of Default has occurred and is
continuing or would occur as a consequence of such Restricted Payment; and

                  (b) the Company would, at the time of such Restricted Payment
and after giving pro forma effect thereto as if such Restricted Payment had been
made at the beginning of the applicable four-quarter period, have been permitted
to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge
Coverage Ratio test set forth in Section 4.09(a); and



                                       40


                  (c) such Restricted Payment, together with the aggregate
amount of all other Restricted Payments made by the Company and its Restricted
Subsidiaries after the date hereof (excluding Restricted Payments permitted by
clauses (2) and (3) of the next paragraph), is less than the sum, without
duplication, of:

                (i) 50% of the Company's Consolidated Net Income for the period
          (taken as one accounting period) from April 1, 2002 to the end of the
          Company's most recently ended fiscal quarter for which internal
          financial statements are available at the time of such Restricted
          Payment (or, if such Consolidated Net Income for such period is a
          deficit, less 100% of such deficit), plus

                (ii) 100% of the aggregate net cash proceeds received by the
          Company since the date hereof from the issue or sale of its Equity
          Interests (other than Disqualified Stock) or Equity Interests of any
          of the Company's parent entities (which proceeds are received as a
          contribution to the Company's common or non-redeemable preferred
          equity capital) or from the issue or sale of convertible or
          exchangeable Disqualified Stock or convertible or exchangeable debt
          securities of the Company that have been converted into or exchanged
          for such Equity Interests (other than Equity Interests or Disqualified
          Stock or debt securities sold to a Subsidiary of the Company), plus

                (iii) to the extent that any Restricted Investment that was made
          after the date hereof is sold for cash or otherwise liquidated or
          repaid for cash, the lesser of (1) the cash return of capital with
          respect to such Restricted Investment (less the cost of disposition,
          if any) and (2) the initial amount of such Restricted Investment.

                  So long as no Default has occurred and is continuing or would
be caused thereby, the preceding provisions will not prohibit:

                  (1) the payment of any dividend within 60 days after the date
of declaration of the dividend, if at the date of declaration the dividend
payment would have complied with the provisions hereof;

                  (2) the redemption, repurchase, retirement, defeasance or
other acquisition of any Subordinated Indebtedness or of any of the Company's
Equity Interests by conversion into, or by an exchange for, shares of the
Company's Equity Interests (other than Disqualified Stock), or in exchange for,
or out of the net cash proceeds of the substantially concurrent sale (other than
to any of the Company's Restricted Subsidiaries) of, the Company's Equity
Interests (other than Disqualified Stock); provided that the amount of any such
net cash proceeds that are utilized for any such redemption, repurchase,
retirement, defeasance or other acquisition will be excluded from clause (c)(ii)
of the preceding paragraph;

                  (3) the repurchase, retirement or redemption of any
Subordinated Indebtedness with the proceeds from an Asset Sale to the extent
required by the agreement governing such Subordinated Indebtedness, but only (x)
if the Company has complied with Section 4.12 and (y) to the extent of the
Excess Proceeds remaining after the offer made to Holders of the Notes pursuant
to the Asset Sale;

                  (4) the defeasance, redemption, repurchase or other
acquisition of Subordinated Indebtedness with the net cash proceeds from an
incurrence of Permitted Refinancing Indebtedness; and

                  (5) other Restricted Payments in an aggregate amount since
June 28, 2002 not to exceed $10.0 million.

                  The amount of all Restricted Payments (other than cash) will
be the fair market value on the date of the Restricted Payment of the asset(s)
or securities proposed to be transferred or issued by the Company or such
Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment.
The fair market value of any assets or securities that are required to be valued
by this Section 4.10 will be determined by the Board of Directors of the Company
whose resolutions with respect thereto will be delivered to the Trustee. The
Board of Directors' determination must be based upon an opinion or appraisal
issued by an accounting, appraisal or investment banking firm of national
standing if the fair market value exceeds $5.0 million. Not later than the date
of making any Restricted Payment, the Company shall deliver to the Trustee an
Officers' Certificate stating that such Restricted



                                       41


Payment is permitted and setting forth the basis upon which the calculations
required by this Section 4.10 were computed, together with a copy of any
fairness opinion or appraisal required by this Indenture.

Section 4.11.     LIENS.
                  -----

                  The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, create, incur, assume or
suffer to exist any Lien of any kind securing Indebtedness, Attributable Debt or
trade payables on any asset now owned or hereafter acquired or any proceeds
therefrom, or assign or convey any right to receive income therefrom, except
Permitted Liens.

Section 4.12.     ASSET SALES.
                  -----------

                  (a) The Company shall not, and shall not permit any of its
Restricted Subsidiaries to consummate an Asset Sale unless:

                (i) the Company or such Restricted Subsidiary, as the case may
          be, receives consideration at the time of such Asset Sale at least
          equal to the fair market value of the assets sold or otherwise
          disposed of (evidenced by a Board Resolution of the Board of Directors
          of the Company set forth in an Officers' Certificate delivered to the
          Trustee);

                (ii) if the Company or such Restricted Subsidiary, as the case
          may be, receives consideration at the time of such Asset Sale greater
          than $7.5 million, the fair market value of the assets sold or
          otherwise disposed of is determined by Parent's Board of Directors
          (such determination to be evidenced by a Board Resolution of Parent's
          Board of Directors set forth in an Officers' Certificate delivered to
          the Trustee) or in a written opinion issued by an independent
          appraisal firm or financial advisor of national standing; and

                (iii) at least 75% of the consideration received in the Asset
          Sale by the Company or such Restricted Subsidiary is in the form of
          cash, Cash Equivalents or Replacement Assets.

                  (b) For purposes of Section 4.12(a) only, each of the
following will be deemed to be cash:

                (i) any liabilities of the Company or any of its Restricted
          Subsidiaries, as shown on the Company's or such Restricted
          Subsidiary's most recent balance sheet (other than contingent
          liabilities and liabilities that are by their terms subordinated to
          the Notes or any Restricted Subsidiary's Subsidiary Guarantee) that
          are assumed by the transferee of any such assets pursuant to a
          customary novation agreement that releases the Company or such
          Restricted Subsidiary from further liability; and

                (ii) any securities, notes or other obligations received by the
          Company or any such Restricted Subsidiary from such transferee that
          are contemporaneously, subject to ordinary settlement periods,
          converted by the Company or such Restricted Subsidiary into cash, to
          the extent of the cash received in that conversion;

                (iii) any Designated Non-Cash Consideration received by the
          Company or any of its Restricted Subsidiaries in the Asset Sale.

                  (c) Within 365 days after the receipt of any Net Proceeds from
an Asset Sale, the Company and its Restricted Subsidiaries may apply those Net
Proceeds at their option:

                (i) to repay Senior Debt and, if the Senior Debt repaid is
          revolving credit Indebtedness, to correspondingly permanently reduce
          commitments with respect thereto;

                (ii) to acquire all or substantially all of the assets of, or a
          majority of the Voting Stock of, another Permitted Business; or

                (iii) to acquire other long-term assets that are used or useful
          in a Permitted Business.



                                       42


                  Pending the final application of any Net Proceeds, the Company
may temporarily reduce revolving credit borrowings or otherwise invest the Net
Proceeds in any manner that is not prohibited by this Indenture.

                  (d) Any Net Proceeds from Asset Sales that are not applied or
invested within such 365-day period as provided in Section 4.12(c) will
constitute "EXCESS PROCEEDS." When the aggregate amount of Excess Proceeds
exceeds $15.0 million, the Company shall make an Asset Sale Offer (which offer
may be made at any time within such 365-day period) to all Holders of Notes and
Additional Notes, if any, and all holders of other Indebtedness that is pari
passu with the Notes containing provisions similar to those set forth herein
with respect to offers to purchase or redeem with the proceeds of sales of
assets to purchase, on a pro rata basis, the maximum principal amount of Notes
and Additional Notes, if any, and such other pari passu Indebtedness equal in
amount to the Excess Proceeds (and not just the amount thereof that exceeds
$15.0 million). The offer price in any Asset Sale Offer will be equal to 100% of
the principal amount thereof plus accrued and unpaid interest and Additional
Interest, if any, to the date of purchase, in accordance with the procedures set
forth herein, and shall be payable in cash. If any Excess Proceeds remain after
consummation of an Asset Sale Offer, the Company may use those Excess Proceeds
for any purpose not otherwise prohibited by this Indenture. If the aggregate
principal amount of Notes and Additional Notes, if any, and other pari passu
Indebtedness surrendered by holders thereof exceeds the amount of Excess
Proceeds, the Trustee shall select the Notes and Additional Notes and other pari
passu Indebtedness to be purchased as described in Article 3 hereof. Upon
completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset
at zero.

                  (e) The Company shall comply with the requirements of Rule
14e-1 under the Exchange Act and any other securities laws and regulations
thereunder to the extent those laws and regulations are applicable in connection
with each repurchase of Notes pursuant to an Asset Sale Offer. To the extent
that the provisions of any securities laws or regulations conflict with the
Asset Sale provisions of this Indenture, the Company shall comply with the
applicable securities laws and regulations and will not be deemed to have
breached its obligations under this Section 4.12 by virtue of such conflict.

Section 4.13.     DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING RESTRICTED
                  SUBSIDIARIES.
                  ------------------------------------------------------------

                  The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, directly or indirectly, create or permit to exist or
become effective any consensual encumbrance or restriction on the ability of any
Restricted Subsidiary to:

                  (a) pay dividends or make any other distributions on or in
respect of its Capital Stock to the Company or any of its Restricted
Subsidiaries, or with respect to any other interest or participation in, or
measured by, its profits, or pay any Indebtedness owed to the Company or any
other of its Restricted Subsidiaries;

                  (b) make any loans or advances to the Company or any other of
its Restricted Subsidiaries;

                  (c) sell, lease or transfer any of its properties or assets to
the Company or any other of its Restricted Subsidiaries; or

                  (d) guarantee the Company's obligations.

                  However, the preceding restrictions will not apply to
encumbrances or restrictions existing under or by reason of:

                (i) agreements as in effect on the date hereof or subsequent
          agreements relating to our Indebtedness or Indebtedness of any
          Subsidiary Guarantor and any amendments, modifications, restatements,
          renewals, increases, supplements, refundings, replacements or
          refinancings of those agreements; provided that the amendments,
          modifications, restatements, renewals, increases, supplements,
          refundings, replacement or refinancings are not materially more
          restrictive, taken as a whole, with respect to such dividend and other
          payment restrictions than those contained in those agreements on the
          date hereof;



                                       43


                (ii) this Indenture, the Notes and the Subsidiary Guarantees;

                (iii) applicable law;

                (iv) any instrument governing Indebtedness or Capital Stock of a
          Person acquired by the Company or any of its Restricted Subsidiaries
          as in effect at the time of such acquisition (except to the extent
          such Indebtedness or Capital Stock was incurred in connection with or
          in contemplation of such acquisition), which encumbrance or
          restriction is not applicable to any Person, or the properties or
          assets of any Person, other than the Person, or the property or assets
          of the Person, so acquired; provided that, in the case of
          Indebtedness, such Indebtedness was permitted by the terms of this
          Indenture to be incurred;

                (v) customary non-assignment provisions in leases entered into
          in the ordinary course of business;

                (vi) purchase money obligations for property acquired in the
          ordinary course of business that impose restrictions on that property
          of the nature described in clause (c) of the preceding paragraph;

                (vii) any agreement for the sale or other disposition of a
          Restricted Subsidiary that restricts distributions by that Restricted
          Subsidiary pending its sale or other disposition;

                (viii) Permitted Refinancing Indebtedness; provided that the
          restrictions contained in the agreements governing such Permitted
          Refinancing Indebtedness are not materially more restrictive, taken as
          a whole, than those contained in the agreements governing the
          Indebtedness being refinanced;

                (ix) Liens securing Indebtedness otherwise permitted to be
          incurred under Section 4.11 that limit the right of the debtor to
          dispose of the assets subject to such Liens; and

                (x) provisions with respect to the disposition or distribution
          of assets or property in joint venture agreements, asset sale
          agreements, stock sale agreements and other similar agreements entered
          into in the ordinary course of business.

Section 4.14.     TRANSACTIONS WITH AFFILIATES.
                  ----------------------------

                  The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, make any payment to, or sell, lease, transfer or
otherwise dispose of any of their respective properties or assets to, or
purchase any property or assets from, or enter into or make or amend any
transaction, contract, agreement, understanding, loan, advance or guarantee
with, or for the benefit of, any Affiliate (each, an "AFFILIATE TRANSACTION"),
unless:

                  (a) the Affiliate Transaction is on terms that are no less
favorable to the Company or the relevant Restricted Subsidiary than those that
would have been obtained in a comparable transaction by the Company or such
Restricted Subsidiary with a Person that is not an Affiliate; and

                  (b) the Company delivers to the trustee:

                (i) with respect to any Affiliate Transaction or series of
          related Affiliate Transactions involving aggregate consideration in
          excess of $5.0 million, a resolution of the Board of Directors of the
          Company set forth in an Officers' Certificate certifying that such
          Affiliate Transaction complies with this covenant and that such
          Affiliate Transaction has been approved by a majority of the
          disinterested members of the Board of Directors of the Company or
          Parent's Board of Directors, or, if there are no disinterested members
          of the approving Board of Directors at the time, a written opinion
          issued by an independent appraisal firm or financial advisor of
          national standing that such Affiliate Transaction is fair to the
          Company or such Restricted Subsidiary, as the case may be, from a
          financial point of view; and

                (ii) with respect to any Affiliate Transaction or series of
          related Affiliate Transactions involving aggregate consideration in
          excess of $10.0 million, a written opinion issued by an independent
          financial



                                       44


          advisor of national standing that such Affiliate Transaction is fair
          to the Company or such Restricted Subsidiary, as the case may be,
          from a financial point of view.

                  The following items will not be deemed to be Affiliate
Transactions and, therefore, will not be subject to the provisions of the prior
paragraph:

                  (a) transactions between or among the Company and/or its
Restricted Subsidiaries;

                  (b) transactions with a Person that is an Affiliate of the
Company solely because the Company owns an Equity Interest in such Person;

                  (c) advances to officers of the Company or any of the
Company's Restricted Subsidiaries in the ordinary course of business to provide
for the payment of reasonable expenses incurred by such persons in the
performance of their responsibilities to the Company or such Restricted
Subsidiary or in connection with any relocation;

                  (d) sales of Equity Interests (other than Disqualified Stock)
to Affiliates of the Company;

                  (e) fees and compensation paid to and indemnity provided on
behalf of directors, officers or employees of the Company or any Restricted
Subsidiary of the Company in the ordinary course of business;

                  (f) any employment agreement that is in effect on the date
hereof and any such employment agreement entered into by the Company or any of
its Restricted Subsidiaries after the date hereof in the ordinary course of
business;

                  (g) any Restricted Payment that is not prohibited by Section
4.10;

                  (h) any sale, conveyance or other transfer of accounts
receivable and other related assets customarily transferred in a Securitization
Transaction;

                  (i) payment of premiums to, and the receipt of proceeds of
insurance from, Laurier Indemnity Company and Laurier Indemnity Company, Ltd.;

                  (j) payments to or receipts from Extendicare Holdings, Inc.
pursuant to any tax sharing agreement entered into for the purpose of preparing
a consolidated tax return of Extendicare Holdings, Inc.;

                  (k) payments to or receipts from Virtual Care Provider, Inc.
in connection with the provision of technology services to third parties
pursuant to the terms of management, consulting or other similar agreements; and

                  (l) transactions pursuant to the services agreement between
the Company and Virtual Care Provider, Inc. relating to certain services
provided by the Company and Virtual Care Provider, Inc. to each other as in
effect on the date hereof.

Section 4.15.     SALE AND LEASEBACK TRANSACTIONS.
                  -------------------------------

                  The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, enter into any sale and leaseback transaction;
provided that the Company or any Subsidiary Guarantor may enter into a sale and
leaseback transaction if:

                  (a) the Company or that Subsidiary Guarantor could have (a)
incurred Indebtedness in an amount equal to the Attributable Debt relating to
such sale and leaseback transaction under the Fixed Charge Coverage Ratio test
in the first paragraph of Section 4.09 and (b) incurred a Lien to secure such
Indebtedness pursuant to Section 4.11;

                                       45




                  (b) the gross cash proceeds of that sale and leaseback
transaction are at least equal to the fair market value, as determined in good
faith by the Board of Directors of the Company and set forth in an Officers'
Certificate delivered to the Trustee, of the property that is the subject of
that sale and leaseback transaction; and

                  (c) the transfer of assets in that sale and leaseback
transaction is permitted by, and the Company applies the proceeds of such
transaction in compliance with, Section 4.12.

Section 4.16.     ISSUANCES AND SALES OF CAPITAL STOCK OF RESTRICTED
                  SUBSIDIARIES
                  ---------------------------------------------------

                  The Company (a) shall not, and shall not permit any of its
Restricted Subsidiaries to, transfer, convey, sell, lease or otherwise dispose
of any Capital Stock of any of its Restricted Subsidiaries to any Person (other
than to the Company or another one of its Restricted Subsidiaries), unless (i)
such transfer, conveyance, sale, lease or other disposition is of all the
Capital Stock of such Restricted Subsidiary and (ii) the Net Proceeds from such
transfer, conveyance, sale, lease or other disposition are applied in accordance
with Section 4.12; provided that this clause (a) shall not apply to any pledge
of Capital Stock of any Restricted Subsidiary of the Company securing
Indebtedness under Credit Facilities, including the Credit Agreement, or any
exercise of remedies in connection therewith, and (b) shall not permit any
Restricted Subsidiary of the Company to issue any of its Equity Interests (other
than, if necessary, shares of its Capital Stock constituting directors'
qualifying shares or ownership by foreign nationals) to any Person other than
the Company or another one of its Restricted Subsidiaries.

Section 4.17.     DESIGNATION OF RESTRICTED AND UNRESTRICTED SUBSIDIARIES.
                  -------------------------------------------------------

                  The Board of Directors of the Company may designate any
Restricted Subsidiary to be an Unrestricted Subsidiary if that designation would
not cause a Default. If a Restricted Subsidiary is designated as an Unrestricted
Subsidiary, the aggregate fair market value of all outstanding Investments owned
by the Company and its Restricted Subsidiaries in the Subsidiary properly
designated will be deemed to be an Investment made as of the time of the
designation and will reduce the amount available for Restricted Payments under
the first paragraph of Section 4.10 or Permitted Investments, as determined by
the Company. That designation will only be permitted if the Investment would be
permitted at that time and if the Restricted Subsidiary otherwise meets the
definition of an Unrestricted Subsidiary. The Board of Directors of the Company
may redesignate any Unrestricted Subsidiary to be a Restricted Subsidiary if the
redesignation would not cause a Default.

Section 4.18.     REPURCHASE AT THE OPTION OF HOLDERS UPON A CHANGE OF CONTROL.
                  ------------------------------------------------------------

                  (a) Upon the occurrence of a Change of Control, each Holder
shall have the right to require the Company to repurchase all or any part (equal
to $1,000 or an integral multiple of $1,000) of such Holder's Notes pursuant to
the offer described below (the "CHANGE OF CONTROL OFFER") at a purchase price
(the "CHANGE OF CONTROL PURCHASE PRICE") equal to 101% of the aggregate
principal amount of Notes repurchased, plus accrued and unpaid interest and
Additional Interest if any, on the Notes repurchased, to the purchase date
(subject to the right of Holders on the relevant record date to receive interest
due on the relevant Interest Payment Date).

                  Subject to clause (c) below, within 30 days following any
Change of Control, the Company shall mail a notice to the Trustee and each
Holder:

                (i) send, by first-class mail, with a copy to the Trustee, to
          each Holder, at such Holder's address appearing in the securities
          register maintained in respect of the Notes by the Registrar (the
          "SECURITY REGISTER"):

                    (A) that a Change of Control has occurred and a Change of
                  Control Offer is being made pursuant to Section 4.18 and that
                  all Notes timely tendered will be accepted for payment;

                    (B) the Change of Control Purchase Price and the purchase
                  date, which shall be, subject to any contrary requirements of
                  applicable law, a business day



                                       46

                  no earlier than 30 days and no later than 60 days from the
                  date such notice is mailed;

                    (C) the circumstances and relevant facts regarding the
                  Change of Control (including information with respect to pro
                  forma historical income, cash flow and capitalization after
                  giving effect to the Change of Control); and

                    (D) the procedures that Holders must follow in order to
                  tender their Notes (or portions thereof) for payment, and the
                  procedures that Holders must follow in order to withdraw an
                  election to tender Notes (or portions thereof) for payment.

                  The Company will comply, to the extent applicable, with the
requirements of Rule 14(e)-1 under the Exchange Act and any other securities
laws and regulations thereunder to the extent those laws and regulations are
applicable in connection with the repurchase of the Notes as a result of a
Change of Control. To the extent that the provisions of any securities laws or
regulations conflict with the Change of Control provisions of the covenant
described hereunder, the Company will comply with the applicable securities laws
and regulations and will not be deemed to have breached its obligations under
the covenant described hereunder by virtue of such conflict.

                    (b) On the Change of Control Payment Date, the Company
                  shall, to the extent lawful:

                (i) accept for payment all Notes or portions of Notes properly
          tendered pursuant to the Change of Control Offer;

                (ii) deposit with the Paying Agent an amount equal to the Change
          of Control Payment in respect of all Notes or portions of Notes
          properly tendered; and

                (iii) deliver or cause to be delivered to the Trustee the Notes
          properly accepted together with an Officers' Certificate stating the
          aggregate principal amount of Notes or portions of Notes being
          purchased by the Company.

                  The Paying Agent shall promptly mail to each Holder of Notes
properly tendered the Change of Control Payment for such Notes, and the Trustee
will promptly authenticate and mail (or cause to be transferred by book-entry)
to each Holder a new note equal in principal amount to any unpurchased portion
of the Notes surrendered, if any; provided that each new note will be in a
principal amount of $1,000 or an integral multiple of $1,000.

                  (c) Prior to complying with any of the provisions of this
Section 4.18, but in any event within 90 days following a Change of Control, the
Company shall either repay all outstanding Senior Debt or obtain the requisite
consents, if any, under all agreements governing outstanding Senior Debt to
permit the repurchase of Notes required by this covenant. The Company shall
publicly announce the results of the Change of Control Offer on or as soon as
practicable after the Change of Control Payment Date.

                  (d) The provisions described above that require us to make a
Change of Control Offer following a Change of Control will be applicable whether
or not any other provisions of the indenture are applicable. Except as described
above with respect to a Change of Control, this Indenture does not contain
provisions that permit the Holders of the Notes to require that the Company
repurchase or redeem the Notes in the event of a takeover, recapitalization or
similar transaction.

                  (e) The Company will not be required to make a Change of
Control Offer upon a Change of Control if a third party makes a Change of
Control Offer in the manner, at the times and otherwise in compliance with the
requirements set forth in this Indenture applicable to a Change of Control Offer
made by the Company and purchases all Notes properly tendered and not withdrawn
under the Change of Control Offer.



                                       47


Section 4.19.     ADDITIONAL SUBSIDIARY GUARANTEES

                  If the Company or any of its Restricted Subsidiaries acquires
or creates another domestic Significant Subsidiary or any other Domestic
Subsidiary that guarantees or incurs any Indebtedness or any other Significant
Subsidiary or Restricted Subsidiary that guarantees or otherwise provides direct
credit support for Indebtedness of the Company or any of the Company's Domestic
Subsidiaries after the date hereof, then that newly acquired or created
Significant Subsidiary, Domestic Subsidiary or other Restricted Subsidiary will
execute and deliver to the Trustee a supplemental indenture providing for a
Subsidiary Guarantee and deliver an Opinion of Counsel satisfactory to the
Trustee within 10 Business Days of the date on which it was acquired or created;
provided, however, that the foregoing shall not apply to Subsidiaries that have
properly been designated as Unrestricted Subsidiaries in accordance with this
Indenture for so long as they continue to constitute Unrestricted Subsidiaries.

Section 4.20.     DESIGNATION AS "DESIGNATED SENIOR INDEBTEDNESS"

                  The Company hereby designates the Notes as "Designated Senior
Indebtedness" as that term is defined in the Senior Subordinated Note Indenture.

Section 4.21.     BUSINESS ACTIVITIES.
                  -------------------

                  The Company shall not, and shall not permit any Restricted
Subsidiary to, engage in any business other than Permitted Businesses, except to
such extent as would not be material to the Company and its Subsidiaries taken
as a whole.

                                   ARTICLE 5.

                                   SUCCESSORS

Section 5.01.     MERGER, CONSOLIDATION, OR SALE OF PROPERTY.
                  ------------------------------------------

                  The Company shall not, directly or indirectly (a) consolidate
or merge with or into another Person (whether or not the Company is the
surviving corporation) or (b) sell, assign, transfer, convey or otherwise
dispose of all or substantially all of the properties or assets of the Company
and its Restricted Subsidiaries taken as a whole, in one or more related
transactions, to another Person; unless:

                  (a) either: (x) the Company is the surviving corporation; or
(y) the Person formed by or surviving any such consolidation or merger (if other
than the Company) or to which such sale, assignment, transfer, conveyance or
other disposition has been made is a corporation organized or existing under the
laws of the United States, any state of the United States or the District of
Columbia;

                  (b) the Person formed by or surviving any such consolidation
or merger (if other than the Company) or the Person to which such sale,
assignment, transfer, conveyance or other disposition has been made assumes all
of the Company's obligations under the Notes, this Indenture and the
Registration Rights Agreement pursuant to a supplemental indenture reasonably
satisfactory to the Trustee;

                  (c) immediately after such transaction no Default or Event of
Default exists;

                  (d) the Company or the Person formed by or surviving any such
consolidation or merger (if other than the Company), or to which such sale,
assignment, transfer, conveyance or other disposition has been made shall, on
the date of such transaction after giving pro forma effect thereto and any
related financing transactions as if the same had occurred at the beginning of
the applicable four-quarter period, be permitted to incur at least $1.00 of
additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set
forth in Section 4.09.

                  (e) the Company, or the Person formed by or surviving any such
consolidation or merger (if other than the Company), or to which such sale,
assignment, transfer, conveyance or other disposition has been made,



                                       48

shall have delivered to the Trustee an Officers' Certificate and an Opinion of
Counsel, each stating that such transaction and any supplemental indenture
entered into in connection therewith complies with all of the terms of this
Section 5.01 and that all conditions precedent provided for in this Indenture
relating to such transaction or series of transactions have been complied with.

                  In addition, the Company may not, directly or indirectly,
lease all or substantially all of its properties or assets, in one or more
related transactions, to any other Person. The Person formed by or surviving any
consolidation or merger (if other than the Company) will succeed to, and be
substituted for, and may exercise every right and power of the Company under
this Indenture, but, in the case of a lease of all or substantially all the
assets of the Company, the Company will not be released from the obligation to
pay the principal of and interest on the Notes.

Section 5.02.     SUCCESSOR CORPORATION SUBSTITUTED.
                  ---------------------------------

                  The Surviving Person shall succeed to, and be substituted for,
and may exercise every right and power of the Company under this Indenture, but
the predecessor Company in the case of:

                  (a) a sale, transfer, assignment, conveyance or other
disposition (unless such sale, transfer, assignment, conveyance or other
disposition is of all the assets of the Company as an entirety or virtually as
an entirety), or

                  (b) a lease,

shall not be released from any of the obligations or covenants under this
Indenture, including with respect to the payment of the Notes.

                                   ARTICLE 6.

                              DEFAULTS AND REMEDIES

Section 6.01.     EVENTS OF DEFAULT.
                  -----------------

Each of the following is an "Event of Default:"

                (i) default for 30 days in the payment when due of interest on,
          or Additional Interest with respect to, the Notes;

                (ii) default in payment when due of the principal of or premium,
          if any, on the Notes;

                (iii) failure by the Company or any of its Restricted
          Subsidiaries to comply with Section 4.09, Section 4.10 or Article 5;

                (iv) failure by the Company or any of its Restricted
          Subsidiaries for 30 days after notice to comply with Sections 4.12 or
          4.18;

                (v) failure by the Company or any of its Restricted Subsidiaries
          for 60 days after notice to comply with any other covenant or
          agreement in the Notes or in this Indenture;

                (vi) default under any mortgage, indenture or instrument under
          which there may be issued or by which there may be secured or
          evidenced any Indebtedness for money borrowed by the Company or any of
          its Restricted Subsidiaries (or the payment of which is guaranteed by
          the Company or any of its Restricted Subsidiaries) whether such
          Indebtedness or guarantee now exists, or is created after the date
          hereof, if that default:



                                       49


                    (A) is caused by a failure to pay principal of, or interest
                  or premium, if any, on such Indebtedness prior to the
                  expiration of the grace period provided in such Indebtedness
                  on the date of such default (a "PAYMENT DEFAULT"); or

                    (B) results in the acceleration of such Indebtedness prior
                  to its express maturity,

                  and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such Indebtedness
under which there has been a Payment Default or the maturity of which has been
so accelerated, aggregates $20.0 million or more;

                (vii) failure by the Company or any of its Restricted
          Subsidiaries to pay final judgments (to the extent not fully covered
          by insurance) aggregating in excess of $20.0 million, which judgments
          are not paid, discharged or stayed for a period of 60 consecutive
          days;

                (viii) except as permitted by this Indenture, any Subsidiary
          Guarantee shall be held in any judicial proceeding to be unenforceable
          or invalid or shall cease for any reason to be in full force and
          effect or any Subsidiary Guarantor, or any Person acting on behalf of
          any Subsidiary Guarantor, shall deny or disaffirm its obligations
          under its Subsidiary Guarantee; and

                (ix) the Company or any of its Significant Subsidiaries pursuant
          to or within the meaning of Bankruptcy Law:

                    (A) commences a voluntary case,

                    (B) consents to the entry of an order for relief against it
                  in an involuntary case,

                    (C) consents to the appointment of a custodian of it or for
                  all or substantially all of its property,

                    (D) makes a general assignment for the benefit of its
                  creditors, or

                    (E) generally is not paying its debts as they become due;
                  and

                (x) a court of competent jurisdiction enters an order or decree
          under any Bankruptcy Law that:

                    (A) is for relief against the Company or any of its
                  Significant Subsidiaries in an involuntary case; or

                    (B) appoints a Custodian of the Company or any of its
                  Significant Subsidiaries or for all or substantially all of
                  the property of the Company or any of its Significant
                  Subsidiaries; or

                    (C) orders the liquidation of the Company or any of its
                  Significant Subsidiaries;

                  and the order or decree remains unstayed and in effect for 60
                  consecutive days.

Section 6.02.     ACCELERATION.
                  ------------

                  If an Event of Default (other than an Event of Default
specified in clauses (ix) or (x) of Section 6.01 hereof, with respect to the
Company, any Subsidiary that is a Significant Subsidiary or any group of
Subsidiaries that, taken together would constitute a Significant Subsidiary),
shall have occurred and be continuing, the Trustee or the Holders of not less
than 25% in aggregate principal amount of the Notes then outstanding may



                                       50


declare to be immediately due and payable the principal amount of all the Notes
then outstanding, plus accrued but unpaid interest and Additional Interest, if
any, to the date of acceleration. In the case of an Event of Default specified
in clauses (ix) or (x) of Section 6.01 hereof, with respect to the Company, any
Subsidiary that is a Significant Subsidiary or any group of Subsidiaries that,
taken together would constitute a Significant Subsidiary shall occur, such
amount with respect to all the Notes will become due and payable immediately
without any declaration or other act on the part of the Trustee or the Holders.
Holders may not enforce this Indenture or the Notes except as provided in this
Indenture. Subject to the limitations described in this Article 6, Holders of a
majority in aggregate principal amount of the then outstanding Notes may direct
the Trustee in its exercise of any trust or power. The Trustee may withhold from
Holders notice of any continuing Default or Event of Default (except a Default
or Event of Default relating to the payment of principal, premium, if any, or
interest or Additional Interest, if any) if it determines that withholding
notice is in their interest.

                  In the case of an Event of Default occurring by reason of any
willful action or inaction taken or not taken by the Company or on the Company's
behalf with the intention of avoiding payment of the premium that the Company
would have been required to pay if the Company had then elected to redeem the
Notes pursuant to Section 3.07 hereof, an equivalent premium will also become
and be immediately due and payable to the extent permitted by law upon the
acceleration of the Notes. If an Event of Default occurs prior to July 1, 2006,
by reason of any willful action or inaction taken or not taken by the Company or
on the Company's behalf with the intention of avoiding the prohibition on
redemption of the Notes prior to July 1, 2006, then the premium specified in
Section 3.07 will also become immediately due and payable to the extent
permitted by law upon acceleration of the Notes.

Section 6.03.     OTHER REMEDIES.
                  --------------

                  If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy to collect the payment of principal, premium, if
any, and interest and Additional Interest, if any, on the Notes or to enforce
the performance of any provision of the Notes or this Indenture.

                  The Trustee may maintain a proceeding even if it does not
possess any of the Notes or does not produce any of them in the proceeding. A
delay or omission by the Trustee or any Holder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.

Section 6.04.     WAIVER OF PAST DEFAULTS.
                  -----------------------

                  Holders of not less than a majority in aggregate principal
amount of the then outstanding Notes by notice to the Trustee may on behalf of
the Holders of all of the Notes waive an existing Default or Event of Default
and its consequences hereunder, except a continuing Default or Event of Default
in the payment of the principal of, premium, if any, or interest or Additional
Interest on, the Notes; provided, however, that after any acceleration, but
before a judgment or decree based on acceleration is obtained by the Trustee,
the Holders of a majority in aggregate principal amount of the Notes then
outstanding may rescind and annul such acceleration if all Events of Default,
other than the nonpayment of accelerated principal, premium or interest or
Additional Interest, have been cured or waived as provided in this Indenture.
Upon any such waiver, such Default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
Default or impair any right consequent thereon.

Section 6.05.     CONTROL BY MAJORITY.
                  -------------------

                  Subject to Section 7.01, in case an Event of Default shall
occur and be continuing, the Trustee will be under no obligation to exercise any
of its rights or powers under this Indenture at the request or direction of any
of the Holders, unless such Holders shall have offered to the Trustee reasonable
indemnity. Subject to Section 7.07, the Holders of a majority in aggregate
principal amount of the Notes then outstanding will have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee or exercising any trust or power conferred on the Trustee with
respect to the Notes.



                                       51


Section 6.06.     LIMITATION ON SUITS.
                  -------------------

                  No Holder will have any right to institute any proceeding with
respect to this Indenture, or for the appointment of a receiver or trustee, or
for any remedy thereunder, unless:

                  (a) such Holder has previously given to the Trustee written
notice of a continuing Event of Default,

                  (b) Holders of at least 25% in aggregate principal amount of
the Notes then outstanding have made written request and offered reasonable
indemnity to the Trustee to institute such proceeding as trustee, and

                  (c) the Trustee shall not have received from the Holders of a
majority in aggregate principal amount of the Notes then outstanding a direction
inconsistent with such request and shall have failed to institute such
proceeding within 60 days.

                  The preceding limitations do not apply to a suit instituted by
a Holder for enforcement of payment of the principal of, and premium, if any, or
interest or Additional Interest on, a Note on or after the respective due dates
expressed in such Note.

                  A Holder may not use this Indenture to affect, disturb or
prejudice the rights of another Holder or to obtain a preference or priority
over another Holder.

Section 6.07.     RIGHTS OF HOLDERS TO RECEIVE PAYMENT.
                  ------------------------------------

                  Notwithstanding any other provision of this Indenture, the
right of any Holder to receive payment of principal, premium, if any, and
interest and Additional Interest, if any, on the Note, on or after the
respective due dates expressed in the Note (including in connection with an
offer to purchase), or to bring suit for the enforcement of any such payment on
or after such respective dates, shall not be impaired or affected without the
consent of such Holder.

Section 6.08.     COLLECTION SUIT BY TRUSTEE.
                  --------------------------

                  If an Event of Default specified in clauses (i) or (ii) of
Section 6.01 occurs and is continuing, the Trustee is authorized to recover
judgment in its own name and as trustee of an express trust against the Company
for the whole amount of principal of, premium, if any, and interest and
Additional Interest, if any, remaining unpaid on the Notes and interest on
overdue principal and, to the extent lawful, interest and such further amount as
shall be sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.

Section 6.09.     TRUSTEE MAY FILE PROOFS OF CLAIM.
                  --------------------------------

                  The Trustee is authorized to file such proofs of claim and
other papers or documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel) and
the Holders allowed in any judicial proceedings relative to the Company (or any
other obligor upon the Notes), its creditors or its property and shall be
entitled and empowered to participate as a member, voting or otherwise, of any
official committee of creditors appointed in such matter and shall be entitled
and empowered to collect, receive and distribute any money or other property
payable or deliverable on any such claims and any custodian in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee, and in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due to it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.07 hereof. To the extent that the payment of any such compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, and
any other amounts due the Trustee under Section 7.07 hereof out of the estate in
any such proceeding, shall be denied for any reason, payment of the same shall
be secured by a Lien on, and shall be paid out of, any and all distributions,


                                       52


dividends, money, securities and other properties that the Holders may be
entitled to receive in such proceeding whether in liquidation or under any plan
of reorganization or arrangement or otherwise. Nothing herein contained shall be
deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.

Section 6.10.     PRIORITIES.
                  ----------

                  If the Trustee collects any money pursuant to this Article 6,
it shall pay out the money in the following order:

                  First: to the Trustee, its agents and attorneys for amounts
due under Section 7.07 hereof, including payment of all compensation, expenses
and liabilities incurred, and all advances made, by the Trustee and the costs
and expenses of collection;

                  Second: to Holders for amounts due and unpaid on the Notes for
principal, premium, if any, and interest and Additional Interest, if any,
ratably, without preference or priority of any kind, according to the amounts
due and payable on the Notes for principal, premium, if any, and interest and
Additional Interest, if any,, respectively; and

                  Third: to the Company or to such party as a court of competent
jurisdiction shall direct.

                  The Trustee may fix a record date and payment date for any
payment to Holders pursuant to this Section 6.10.

Section 6.11.     UNDERTAKING FOR COSTS.
                  ---------------------

                  In any suit for the enforcement of any right or remedy under
this Indenture or in any suit against the Trustee for any action taken or
omitted by it as a Trustee, a court in its discretion may require the filing by
any party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by a
Holder pursuant to Section 6.07 hereof, or a suit by Holders of more than 10% in
principal amount of the then outstanding Notes.

                                   ARTICLE 7.

                                     TRUSTEE

Section 7.01.     DUTIES OF TRUSTEE.
                  -----------------

                  (a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in its exercise, as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs.

                  (b) Except during the continuance of an Event of Default:

                         (1) the duties of the Trustee shall be determined
                  solely by the express provisions of this Indenture and the
                  Trustee need perform only those duties that are specifically
                  set forth in this Indenture and no others, and no implied
                  covenants or obligations shall be read into this Indenture
                  against the Trustee; and

                         (2) in the absence of bad faith on its part, the
                  Trustee may conclusively rely, as to the truth of the
                  statements and the correctness of the opinions expressed
                  therein, upon certificates or opinions furnished to the
                  Trustee and conforming to the requirements of

                                       53

          this Indenture. However, the Trustee shall examine the certificates
          and opinions to determine whether or not they conform to the
          requirements of this Indenture (but need not confirm or investigate
          the accuracy of mathematical calculations or other facts stated
          therein or otherwise verify the contents thereof).

                  (c) The Trustee may not be relieved from liabilities for its
own negligent action, its own negligent failure to act, or its own willful
misconduct, except that:

                         (1) this paragraph does not limit the effect of
                  paragraph (b) of this Section;

                         (2) the Trustee shall not be liable for any error of
                  judgment made in good faith by a Responsible Officer, unless
                  it is proved that the Trustee was negligent in ascertaining
                  the pertinent facts; and

                         (3) the Trustee shall not be liable with respect to any
                  action it takes or omits to take in good faith in accordance
                  with a direction received by it pursuant to Section 6.05
                  hereof.

                  (d) Whether or not therein expressly so provided, every
provision of this Indenture that in any way relates to the Trustee is subject to
paragraphs (a), (b) and (c) of this Section.

                  (e) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or incur any liability. The Trustee shall be
under no obligation to exercise any of its rights and powers under this
Indenture at the request of any Holders, unless such Holder shall have offered
to the Trustee security and indemnity satisfactory to it against any loss,
liability or expense.

                  (f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.

Section 7.02.     RIGHTS OF TRUSTEE.
                  -----------------

                  (a) The Trustee may conclusively rely upon any document
believed by it to be genuine and to have been signed or presented by the proper
Person. The Trustee need not investigate any fact or matter stated in the
document.

                  (b) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel or both. The Trustee
shall not be liable for any action it takes or omits to take in good faith in
reliance on such Officers' Certificate or Opinion of Counsel. The Trustee may
consult with counsel and the written advice of such counsel or any Opinion of
Counsel shall be full and complete authorization and protection from liability
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon.

                  (c) The Trustee may act through its attorneys and agents and
shall not be responsible for the misconduct or negligence of any agent appointed
with due care.

                  (d) The Trustee shall not be liable for any action it takes or
omits to take in good faith that it believes to be authorized or within the
rights or powers conferred upon it by this Indenture.

                  (e) Unless otherwise specifically provided in this Indenture,
any demand, request, direction or notice from the Company shall be sufficient if
signed by an Officer of the Company.

                  (f) The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request or
direction of any of the Holders unless such Holders shall have offered to the
Trustee reasonable security or indemnity against the costs, expenses and
liabilities that might be incurred by it in compliance with such request or
direction.



                                       54


                  (g) The Trustee shall not be deemed to have notice of any
Default or Event of Default unless a Responsible Officer of the Trustee has
actual knowledge thereof or unless written notice of any event which is in fact
such a Default or Event of Default is received by a Responsible Officer of the
Trustee at the Corporate Trust Office of the Trustee, and such notice references
the specific Default or Event of Default, the Notes and this Indenture.

                  (h) Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law. The Trustee
shall be under no liability for interest on any money received by it hereunder
except as otherwise agreed in writing with the Company.

                  (i) The Trustee shall not be required to give any bond or
surety in respect of the performance of its power and duties hereunder.

                  (j) The Trustee shall have no duty to inquire as to the
performance of the Company's covenants herein.

Section 7.03.     INDIVIDUAL RIGHTS OF TRUSTEE.
                  ----------------------------

                  The Trustee in its individual or any other capacity may become
the owner or pledgee of Notes and may otherwise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest it must eliminate such conflict within 90 days, apply to the SEC for
permission to continue as Trustee or resign. Any Agent may do the same with like
rights and duties. The Trustee is also subject to Section 7.10 and 7.11 hereof.

Section 7.04.     TRUSTEE'S DISCLAIMER.
                  --------------------

                  The Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture or the Notes, it
shall not be accountable for the Company's use of the proceeds from the Notes or
any money paid to the Company or upon the Company's direction under any
provision of this Indenture, it shall not be responsible for the use or
application of any money received by any Paying Agent other than the Trustee,
and it shall not be responsible for any statement or recital herein or any
statement in the Notes or any other document in connection with the sale of the
Notes or pursuant to this Indenture other than its certificate of
authentication.

Section 7.05.     NOTICE OF DEFAULTS.
                  ------------------

                  If a Default or Event of Default occurs and is continuing and
if it is known to the Trustee, the Trustee shall mail to Holders a notice of the
Default or Event of Default within 90 days after it occurs unless such Default
or Event of Default has since been cured. Except in the case of a Default or
Event of Default in payment of principal of, premium, if any, or interest or
Additional Interest, if any, on any Note, the Trustee may withhold the notice if
and so long as a committee of its Responsible Officers in good faith determines
that withholding the notice is in the interests of the Holders.

Section 7.06.     REPORTS BY TRUSTEE TO HOLDERS.
                  -----------------------------

                  Within 60 days after each May 15 beginning with May 15, 2002,
and for so long as Notes remain outstanding, the Trustee shall mail to the
Holders a brief report dated as of such reporting date that complies with TIA
ss. 313(a) (but if no event described in TIA ss. 313(a) has occurred within the
twelve months preceding the reporting date, no report need be transmitted). The
Trustee also shall comply with TIA ss. 313(b)(2). The Trustee shall also
transmit by mail all reports as required by TIA ss. 313(c).

                  A copy of each report at the time of its mailing to the
Holders shall be mailed to the Company and filed with the SEC and each stock
exchange on which the Notes are listed in accordance with TIA ss. 313(d). The
Company shall promptly notify the Trustee when the Notes are listed on any stock
exchange.



                                       55


Section 7.07.     COMPENSATION AND INDEMNITY.
                  --------------------------

                  The Company shall pay to the Trustee from time to time
reasonable compensation for its acceptance of this Indenture and services
hereunder as agreed to in writing. The Trustee's compensation shall not be
limited by any law on compensation of a trustee of an express trust. The Company
shall reimburse the Trustee promptly upon request for all reasonable
disbursements, advances and expenses incurred or made by it in addition to the
compensation for its services. Such expenses shall include the reasonable
compensation, disbursements and expenses of the Trustee's agents and counsel.

                  The Company shall indemnify the Trustee or any predecessor
Trustee against any and all losses, claims, damages, penalties, fines,
liabilities or expenses, including incidental and out-of-pocket expenses and
reasonable attorneys fees ("LOSSES") incurred by it arising out of or in
connection with the acceptance or administration of its duties under this
Indenture, including the costs and expenses of enforcing this Indenture against
the Company (including this Section 7.07) and defending itself against any claim
(whether asserted by the Company or any Holder or any other person) or liability
in connection with the exercise or performance of any of its powers or duties
hereunder, except to the extent any such losses may be attributable to its gross
negligence or bad faith. The Trustee shall notify the Company promptly of any
claim for which it may seek indemnity. Failure by the Trustee to so notify the
Company shall not relieve the Company of its obligations hereunder. The Company
shall defend the claim, and the Trustee shall cooperate in the defense. The
Trustee may have separate counsel and the Company shall pay the reasonable fees
and expenses of such counsel. The Company need not pay for any settlement made
without its consent, which consent shall not be unreasonably withheld. The
Company need not reimburse any expense or indemnify against any loss liability
or expense incurred by the Trustee through the Trustee's own willful misconduct,
gross negligence or bad faith.

                  The obligations of the Company under this Section 7.07 shall
survive the satisfaction and discharge of this Indenture.

                  To secure the Company's payment obligations in this Section,
the Trustee shall have a Lien prior to the Notes on all money or property held
or collected by the Trustee, except that held in trust to pay principal,
premium, if any, and interest and Additional Interest, if any, on particular
Notes. Such Lien shall survive the satisfaction and discharge of this Indenture.

                  When the Trustee incurs expenses or renders services after an
Event of Default specified in clauses (ix) or (x) of Section 6.01 hereof occurs,
the expenses and the compensation for the services (including the fees and
expenses of its agents and counsel) are intended to constitute expenses of
administration under any Bankruptcy Law.

                  The Trustee shall comply with the provisions of TIA ss.
313(b)(2) to the extent applicable.

Section 7.08.     REPLACEMENT OF TRUSTEE.
                  ----------------------

                  A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.

                  The Trustee may resign in writing at any time upon 30 days
prior notice to the Company and be discharged from the trust hereby created by
so notifying the Company. The Holders of a majority in principal amount of the
then outstanding Notes may remove the Trustee by so notifying the Trustee and
the Company in writing. The Company may remove the Trustee if:

                  (a) the Trustee fails to comply with Section 7.10 hereof;

                  (b) the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any Bankruptcy
Law;

                  (c) a custodian or public officer takes charge of the Trustee
or its property; or



                                       56


                  (d) the Trustee becomes incapable of acting.

                  If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, the Company shall promptly appoint a
successor Trustee. Within one year after the successor Trustee takes office, the
Holders of a majority in principal amount of the then outstanding Notes may
appoint a successor Trustee to replace the successor Trustee appointed by the
Company.

                  If a successor Trustee does not take office within 30 days
after the retiring Trustee resigns or is removed, the retiring Trustee, the
Company, or the Holders of at least 10% in principal amount of the then
outstanding Notes may petition any court of competent jurisdiction for the
appointment of a successor Trustee.

                  If the Trustee, after written request by any Holder who has
been a Holder for at least six months, fails to comply with Section 7.10, such
Holder may petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor Trustee.

                  A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders. Subject to the Lien provided for in Section 7.07 hereof,
the retiring Trustee shall promptly transfer all property held by it as Trustee
to the successor Trustee; provided, however, that all sums owing to the Trustee
hereunder shall have been paid. Notwithstanding replacement of the Trustee
pursuant to this Section 7.08, the Company's obligations under Section 7.07
hereof shall continue for the benefit of the retiring Trustee.

Section 7.09.     SUCCESSOR TRUSTEE BY MERGER, ETC.

                  If the Trustee consolidates, merges or converts into, or
transfers all or substantially all of its corporate trust business to, another
corporation, the successor corporation without any further act shall be the
successor Trustee.

Section 7.10.     ELIGIBILITY; DISQUALIFICATION.
                  -----------------------------

                  There shall at all times be a Trustee hereunder that is a
Person organized and doing business under the laws of the United States of
America or of any state thereof that is authorized under such laws to exercise
corporate trustee power, that is subject to supervision or examination by
federal or state authorities and that has a combined capital and surplus of at
least $50,000,000 as set forth in its most recent published annual report of
condition.

                  This Indenture shall always have a Trustee who satisfies the
requirements of TIA ss. 310(a)(1), (2) and (5). The Trustee is subject to TIA
ss. 310(b).

Section 7.11.     PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
                  -------------------------------------------------

                  The Trustee is subject to TIA ss. 311(a), excluding any
creditor relationship listed in TIA ss. 311(b). A Trustee who has resigned or
been removed shall be subject to TIA ss. 311(a) to the extent indicated therein.

                                   ARTICLE 8.

                    LEGAL DEFEASANCE AND COVENANT DEFEASANCE

Section 8.01.     OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
                  --------------------------------------------------------

                  The Company may, at its option and at any time, elect to have
either Section 8.02 or 8.03 hereof be applied to all outstanding Notes upon
compliance with the conditions set forth below in this Article 8.



                                       57


Section 8.02.     LEGAL DEFEASANCE AND DISCHARGE.
                  ------------------------------

                  Upon the Company's exercise under Section 8.01 hereof of the
option applicable to this Section 8.02, the Company shall, subject to the
satisfaction of the conditions set forth in Section 8.04 hereof, be deemed to
have been discharged from its obligations with respect to all outstanding Notes
on the date the conditions set forth below are satisfied (hereinafter, "LEGAL
DEFEASANCE"). For this purpose, Legal Defeasance means that the Company shall be
deemed to have paid and discharged the entire Debt represented by the
outstanding Notes, which shall thereafter be deemed to be "outstanding" only for
the purposes of Section 8.05 hereof and the other Sections of this Indenture
referred to in (a) and (b) below, and to have satisfied all its other
obligations under such Notes and this Indenture (and the Trustee, on demand of
and at the expense of the Company, shall execute proper instruments
acknowledging the same), except for the following provisions which shall survive
until otherwise terminated or discharged hereunder: (a) the rights of Holders of
outstanding Notes to receive solely from the trust fund described in Section
8.04 hereof, and as more fully set forth in such Section, payments in respect of
the principal of, premium, if any, and interest and Additional Interest, if any,
on such Notes when such payments are due, (b) the Company's obligations with
respect to such Notes under Article 2 and Section 4.02 hereof, (c) the rights,
powers, trusts, duties and immunities of the Trustee hereunder and the
obligations of the Company and each of the Subsidiary Guarantors in connection
therewith and (d) this Article 8. If the Company exercises under Section 8.01
hereof the option applicable to this Section 8.02, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, payment of the Notes may not
be accelerated because of an Event of Default. Subject to compliance with this
Article 8, the Company may exercise its option under this Section 8.02
notwithstanding the prior exercise of its option under Section 8.03 hereof.

Section 8.03.     COVENANT DEFEASANCE.
                  -------------------

                  Upon the Company's exercise under Section 8.01 hereof of the
option applicable to this Section 8.03, the Company shall, subject to the
satisfaction of the conditions set forth in Section 8.04 hereof, be released
from its obligations under the covenants contained in Sections 4.05, 4.06 and
4.08 through 4.18 hereof, and the operation of Section 5.01(d) hereof, with
respect to the outstanding Notes on and after the date the conditions set forth
in Section 8.04 are satisfied (hereinafter, "COVENANT DEFEASANCE"), and the
Notes shall thereafter be deemed not "outstanding" for the purposes of any
direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder (it being
understood that such Notes shall not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect to the
outstanding Notes, the Company may omit to comply with and shall have no
liability in respect of any term, condition or limitation set forth in any such
covenant, whether directly or indirectly, by reason of any reference elsewhere
herein to any such covenant or by reason of any reference in any such covenant
to any other provision herein or in any other document and such omission to
comply shall not constitute a Default or an Event of Default under Section 6.01
hereof, but, except as specified above, the remainder of this Indenture and such
Notes shall be unaffected thereby. If the Company exercises under Section 8.01
hereof the option applicable to this Section 8.03, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, payment of the Notes may not
be accelerated because of an Event of Default specified in clauses (iii) and
(iv) (with respect to the covenants contained in Sections 4.05, 4.06 and 4.08
through 4.18 hereof), (v), (vi), (vii) and (viii) (but in the case of clauses
(ix) and (x) of Section 6.01 hereof, with respect to Significant Subsidiaries
only).

Section 8.04.     CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
                  ------------------------------------------

                  The following shall be the conditions to the application of
either Section 8.02 or 8.03 hereof to the outstanding Notes.

                  The Legal Defeasance or Covenant Defeasance may be exercised
only if:

                  (a) the Company irrevocably deposits with the Trustee, in
trust, for the benefit of the Holders of the Notes, cash in U.S. dollars,
non-callable Government Securities, or a combination of cash in U.S. dollars and
non-callable Government Securities, in amounts as will be sufficient, in the
opinion of a nationally recognized firm of independent public accountants, to
pay the principal of, or interest and premium and Additional Interest, if any,



                                       58


on the outstanding Notes on the Stated Maturity or on the applicable redemption
date, as the case may be, and the Company must specify whether the Notes are
being defeased to maturity or to a particular redemption date;

                  (b) in the case of Legal Defeasance, the Company delivers to
the Trustee an Opinion of Counsel reasonably acceptable to the Trustee
confirming that (a) the Company has received from, or there has been published
by, the Internal Revenue Service a ruling or (b) since the date hereof, there
has been a change in the applicable federal income tax law, in either case to
the effect that, and based thereon such Opinion of Counsel will confirm that,
the Holders of the outstanding Notes will not recognize income, gain or loss for
federal income tax purposes as a result of such Legal Defeasance and will be
subject to federal income tax on the same amounts, in the same manner and at the
same times as would have been the case if such Legal Defeasance had not
occurred;

                  (c) in the case of Covenant Defeasance, the Company delivers
to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee
confirming that the Holders of the outstanding Notes will not recognize income,
gain or loss for federal income tax purposes as a result of such Covenant
Defeasance and will be subject to federal income tax on the same amounts, in the
same manner and at the same times as would have been the case if such Covenant
Defeasance had not occurred;

                  (d) no Default or Event of Default has occurred and is
continuing on the date of such deposit (other than a Default or Event of Default
resulting from the borrowing of funds to be applied to such deposit);

                  (e) such Legal Defeasance or Covenant Defeasance will not
result in a breach or violation of, or constitute a default under any material
agreement or instrument (including, without limitation, the Credit Agreement,
but excluding the indenture) to which the Company or any of its Subsidiaries is
a party or by which the Company or any of its Subsidiaries may is bound;

                  (f) the Company delivers to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the intent
of preferring the Holders of Notes over the Company's other creditors with the
intent of defeating, hindering, delaying or defrauding the Company's creditors
or others; and

                  (g) the Company delivers to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent relating to the Legal Defeasance or the Covenant Defeasance have been
complied with.

Section 8.05.     DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
                  OTHER MISCELLANEOUS PROVISIONS.
                  --------------------------------------------------------------

                  Subject to Section 8.06 hereof, all money and U.S. Government
Obligations (including the proceeds thereof) deposited with the Trustee (or
other qualifying trustee, collectively for purposes of this Section 8.05, the
"Trustee") pursuant to Section 8.04 hereof in respect of the outstanding Notes
shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as Paying Agent) as the
Trustee may determine, to the Holders of all sums due and to become due thereon
in respect of principal, premium, if any, and interest and Additional Interest,
if any,, but such money need not be segregated from other funds except to the
extent required by law.

                  The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the cash or U.S.
Government Obligations deposited pursuant to Section 8.04 hereof or the
principal and interest received in respect thereof other than any such tax, fee
or other charge which by law is for the account of the Holders of the
outstanding Notes.

                  Anything in this Article 8 to the contrary notwithstanding,
the Trustee shall deliver or pay to the Company from time to time upon the
request of the Company any money or U.S. Government Obligations held by it as
provided in Section 8.04 hereof which, in the opinion of a nationally recognized
firm of independent certified public accountants expressed in a written
certification thereof delivered to the Trustee (which may be the



                                       59


certification delivered under Section 8.04(b) hereof), are in excess of the
amount thereof that would then be required to be deposited to effect an
equivalent Legal Defeasance or Covenant Defeasance.

Section 8.06.     REPAYMENT TO COMPANY.
                  --------------------

                  Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, in trust for the payment of the principal of, premium,
if any, or interest or Additional Interest on any Note and remaining unclaimed
for two years after such principal, and premium, if any, or interest or
Additional Interest has become due and payable shall be paid to the Company on
its request or (if then held by the Company) shall be discharged from such
trust; and the Holder shall thereafter, as an unsecured creditor, look only to
the Company for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Company as
trustee thereof, shall thereupon cease; provided, however, that the Trustee or
such Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in The New York Times and The
Wall Street Journal (national edition), notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such notification or publication, any unclaimed balance of such
money then remaining shall be repaid to the Company.

Section 8.07.     REINSTATEMENT.
                  -------------

                  If the Trustee or Paying Agent is unable to apply any United
States dollars or U.S. Government Obligations in accordance with Section 8.02 or
8.03 hereof, as the case may be, by reason of any order or judgment of any court
or governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company's obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to
Section 8.02 or 8.03 hereof until such time as the Trustee or Paying Agent is
permitted to apply all such money in accordance with Section 8.02 or 8.03
hereof, as the case may be; provided, however, that, if the Company makes any
payment of principal of, premium, if any, or interest or Additional Interest on
any Note following the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders to receive such payment from the money
held by the Trustee or Paying Agent.

                                   ARTICLE 9.

                        AMENDMENT, SUPPLEMENT AND WAIVER

Section 9.01.     WITHOUT CONSENT OF HOLDERS OF NOTES.
                  -----------------------------------

                  Notwithstanding Section 9.02 of this Indenture, the Company
and the Trustee may amend or supplement this Indenture or the Notes without the
consent of any Holder to:

                  (a) cure any ambiguity, defect or inconsistency;

                  (b) provide for the assumption by a successor corporation of
the obligations of the Company under this Indenture in the case of a merger or
consolidation or sale of all or substantially all of the Company's assets;

                  (c) provide for uncertificated Notes in addition to or in
place of certificated Notes;

                  (d) make any change that would provide any additional rights
or benefits to the Holders of the Notes or that does not adversely affect the
legal rights hereunder of any such Holder; or

                  (e) make any change to comply with any requirement of the SEC
in order to effect or maintain the qualification of this Indenture under the
TIA.

                  Upon the request of the Company accompanied by a Board
Resolution of the Board of Directors authorizing the execution of any such
amended or supplemental Indenture, and upon receipt by the Trustee of the
documents described in Section 7.02 hereof, the Trustee shall join with the
Company in the execution of any



                                       60


amended or supplemental Indenture authorized or permitted by the terms of this
Indenture and to make any further appropriate agreements and stipulations that
may be therein contained, but the Trustee shall not be obligated to enter into
such amended or supplemental Indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.

Section 9.02.     WITH CONSENT OF HOLDERS OF NOTES.
                  --------------------------------

                  Except as provided below in this Section 9.02, the Company and
the Trustee may amend or supplement this Indenture and the Notes may be amended
or supplemented with the consent of the Holders of at least a majority in
principal amount of the Notes, including Additional Notes, if any, then
outstanding voting as a single class (including consents obtained in connection
with a tender offer or exchange offer for, or purchase of, the Notes), and,
subject to Sections 6.04 and 6.07 hereof, any existing Default or Event of
Default (except a continuing Default or Event of Default in the payment of
interest or Additional Interest on, or the principal of, the Notes) or
compliance with any provision of this Indenture or the Notes may be waived with
the consent of the Holders of a majority in principal amount of the Notes,
including Additional Notes, if any, then outstanding voting as a single class
(including consents obtained in connection with a tender offer or exchange offer
for, or purchase of, the Notes).

                  Upon the request of the Company accompanied by a Board
Resolution of the Board of Directors authorizing the execution of any such
amended or supplemental Indenture, and upon the filing with the Trustee of
evidence satisfactory to the Trustee of the consent of the Holders of Notes as
aforesaid, and upon receipt by the Trustee of the documents described in Section
7.02 hereof, the Trustee shall join with the Company in the execution of such
amended or supplemental Indenture unless such amended or supplemental Indenture
directly affects the Trustee's own rights, duties or immunities under this
Indenture or otherwise, in which case the Trustee may in its discretion, but
shall not be obligated to, enter into such amended or supplemental Indenture.

                  The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Persons entitled to consent to any
indenture supplemental hereto. If a record date is fixed, the Holders on such
record date, or their duly designated proxies, and only such Persons, shall be
entitled to consent to such supplemental indenture, whether or not such Holders
remain Holders after such record date; provided, that unless such consent shall
have become effective by virtue of the requisite percentage having been obtained
prior to the date which is 90 days after such record date, any such consent
previously given shall automatically and without further action by any Holder be
cancelled and of no further effect.

                  It shall not be necessary for the consent of the Holders under
this Section 9.02 to approve the particular form of any proposed amendment or
waiver, but it shall be sufficient if such consent approves the substance
thereof.

                  After an amendment, supplement or waiver under this Section
becomes effective, the Company shall mail to the Holders to such Holder's
address appearing in the Security Register a notice briefly describing the
amendment, supplement or waiver. Any failure of the Company to mail such notice,
or any defect therein, shall not, however, in any way impair or affect the
validity of any such amended or supplemental Indenture or waiver. Subject to
Sections 6.04 and 6.07 hereof, the Holders of a majority in aggregate principal
amount of the Notes, including Additional Notes, if any, then outstanding voting
as a single class may waive compliance in a particular instance by the Company
with any provision of this Indenture or the Notes. Without the consent of each
Holder, an amendment or waiver under this Section 9.02 may not (with respect to
any Notes held by a non-consenting Holder):

                  (a) reduce the principal amount of Notes whose Holders must
consent to an amendment, supplement or waiver;

                  (b) reduce the principal of or change the fixed maturity of
any Note or alter the provisions with respect to the redemption of the Notes;

                  (c) make any change in the provisions of Sections 4.12 or
4.18;



                                       61


                  (d) reduce the rate of or change the time for payment of
interest on any note,

                  (e) waive a Default or Event of Default in the payment of
principal of, or interest or premium, or Additional Interest, if any, on the
Notes (except a rescission of acceleration of the Notes by the Holders of at
least a majority in aggregate principal amount of the Notes and a waiver of the
payment default that resulted from such acceleration);

                  (f) make any Note payable in money other than that stated in
the Note,

                  (g) make any change in the provisions of this Indenture
relating to waivers of past Defaults or the rights of Holders of Notes to
receive payments of principal of, or interest or premium or Additional Interest,
if any, on the Notes;

                  (h) waive a redemption payment with respect to any Note;

                  (i) release any Subsidiary Guarantor from any of its
obligations under its Subsidiary Guarantee or this Indenture, except in
accordance with the terms hereof; or

                  (j) make any change in the preceding amendment and waiver
provisions.

Section 9.03.     COMPLIANCE WITH TRUST INDENTURE ACT.
                  -----------------------------------

                  Every amendment or supplement to this Indenture or the Notes
shall be set forth in a amended or supplemental Indenture that complies with the
TIA as then in effect.

Section 9.04.     REVOCATION AND EFFECT OF CONSENTS.
                  ---------------------------------

                  Until an amendment, supplement or waiver becomes effective, a
consent to it by a Holder is a continuing consent by the Holder of a Note and
every subsequent Holder that evidences the same debt as the consenting Holder's
Note, even if notation of the consent is not made on any Note. However, any such
Holder or subsequent Holder may revoke the consent as to its Note if the Trustee
receives written notice of revocation before the date the waiver, supplement or
amendment becomes effective. An amendment, supplement or waiver becomes
effective in accordance with its terms and thereafter binds every Holder.

Section 9.05.     NOTATION ON OR EXCHANGE OF NOTES.
                  --------------------------------

                  The Trustee may place an appropriate notation about an
amendment, supplement or waiver on any Note thereafter authenticated. The
Company in exchange for all Notes may issue and the Trustee shall, upon receipt
of an Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.

                  Failure to make the appropriate notation or issue a new Note
shall not affect the validity and effect of such amendment, supplement or
waiver.

Section 9.06.     TRUSTEE TO SIGN AMENDMENTS, ETC.

                  The Trustee shall sign any amended or supplemental Indenture
authorized pursuant to this Article 9 if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
The Company may not sign an amendment or supplemental Indenture until the Board
of Directors approves it. In executing any amended or supplemental indenture,
the Trustee shall be entitled to receive and (subject to Section 7.01 hereof)
shall be fully protected in relying upon an Officer's Certificate and an Opinion
of Counsel stating that the execution of such amended or supplemental indenture
is authorized or permitted by this Indenture and that such amended or
supplemental indenture is the legal, valid and binding obligations of the
Company enforceable against it in accordance with its terms, subject to
customary exceptions and that such amended or supplemental indenture complies
with the provisions hereof (including Section 9.03).



                                       62


                                  ARTICLE 10.

                              SUBSIDIARY GUARANTEES

Section 10.01.    GUARANTEE.
                  ---------

                  Subject to this Article 10, each of the Subsidiary Guarantors
hereby, jointly and severally, unconditionally guarantees to each Holder of a
Note authenticated and delivered by the Trustee and to the Trustee and its
successors and assigns, irrespective of the validity and enforceability of this
Indenture, the Notes or the obligations of the Company hereunder or thereunder,
that: (a) the principal of, premium, if any, and interest on the Notes shall be
promptly paid in full when due, whether at maturity, by acceleration, redemption
or otherwise, and interest on the overdue principal of and interest on the
Notes, if any, if lawful, and all other obligations of the Company to the
Holders or the Trustee hereunder or thereunder shall be promptly paid in full or
performed, all in accordance with the terms hereof and thereof; and (b) in case
of any extension of time of payment or renewal of any Notes or any of such other
obligations, that same shall be promptly paid in full when due or performed in
accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration pursuant to Section 6.02 hereof or otherwise. Failing
payment when due of any amount so guaranteed or any performance so guaranteed
for whatever reason, the Subsidiary Guarantors shall be jointly and severally
obligated to pay the same immediately. Each Subsidiary Guarantor agrees that
this is a guarantee of payment and not a guarantee of collection.

                  Each Subsidiary Guarantor hereby agrees that its obligations
with regard to this Subsidiary Guarantee shall be joint and several,
unconditional, irrespective of the validity or enforceability of the Notes or
the obligations of the Company under this Indenture, the absence of any action
to enforce the same, the recovery of any judgment against the Company or any
other obligor with respect to this Indenture, the Notes or the Obligations of
the Company under this Indenture or the Notes, any action to enforce the same or
any other circumstances (other than complete performance) which might otherwise
constitute a legal or equitable discharge or defense of a Subsidiary Guarantor.
Each Subsidiary Guarantor further, to the extent permitted by law, waives and
relinquishes all claims, rights and remedies accorded by applicable law to
guarantors and agrees not to assert or take advantage of any such claims, rights
or remedies, including but not limited to: (a) any right to require any of the
Trustee, the Holders or the Company (each a "BENEFITED PARTY"), as a condition
of payment or performance by such Subsidiary Guarantor, to (1) proceed against
the Company, any other guarantor (including any other Subsidiary Guarantor) of
the Obligations under the Subsidiary Guarantees or any other Person, (2) proceed
against or exhaust any security held from the Company, any such other guarantor
or any other Person, (3) proceed against or have resort to any balance of any
deposit account or credit on the books of any Benefited Party in favor of the
Company or any other Person, or (4) pursue any other remedy in the power of any
Benefited Party whatsoever; (b) any defense arising by reason of the incapacity,
lack of authority or any disability or other defense of the Company including
any defense based on or arising out of the lack of validity or the
unenforceability of the Obligations under the Subsidiary Guarantees or any
agreement or instrument relating thereto or by reason of the cessation of the
liability of the Company from any cause other than payment in full of the
Obligations under the Subsidiary Guarantees; (c) any defense based upon any
statute or rule of law which provides that the obligation of a surety must be
neither larger in amount nor in other respects more burdensome than that of the
principal; (d) any defense based upon any Benefited Party's errors or omissions
in the administration of the Obligations under the Subsidiary Guarantees, except
behavior which amounts to bad faith; (e)(1) any principles or provisions of law,
statutory or otherwise, which are or might be in conflict with the terms of the
Subsidiary Guarantees and any legal or equitable discharge of such Subsidiary
Guarantor's obligations hereunder, (2) the benefit of any statute of limitations
affecting such Subsidiary Guarantor's liability hereunder or the enforcement
hereof, (3) any rights to set-offs, recoupments and counterclaims and (4)
promptness, diligence and any requirement that any Benefited Party protect,
secure, perfect or insure any security interest or lien or any property subject
thereto; (f) notices, demands, presentations, protests, notices of protest,
notices of dishonor and notices of any action or inaction, including acceptance
of the Subsidiary Guarantees, notices of default under the Notes or any
agreement or instrument related thereto, notices of any renewal, extension or
modification of the Obligations under the Subsidiary Guarantees or any agreement
related thereto, and notices of any extension of credit to the Company and any
right to consent to any thereof; (g) to the extent permitted under applicable
law, the benefits of any "One Action" rule and (h) any defenses or benefits that
may be derived from or afforded by law which limit the liability of or exonerate
guarantors or sureties, or which may conflict with the terms of the Subsidiary
Guarantees. Each Subsidiary Guarantor hereby covenants that its Subsidiary
Guarantee shall not



                                       63


be discharged except by complete performance of the obligations contained in its
Subsidiary Guarantee and this Indenture.

                  If any Holder or the Trustee is required by any court or
otherwise to return to the Company, the Subsidiary Guarantors or any custodian,
trustee, liquidator or other similar official acting in relation to either the
Company or the Subsidiary Guarantors, any amount paid by either to the Trustee
or such Holder, this Subsidiary Guarantee, to the extent theretofore discharged,
shall be reinstated in full force and effect.

                  Each Subsidiary Guarantor agrees that it shall not be entitled
to any right of subrogation in relation to the Holders in respect of any
obligations guaranteed hereby until payment in full of all obligations
guaranteed hereby. Each Subsidiary Guarantor further agrees that, as between the
Subsidiary Guarantors, on the one hand, and the Holders and the Trustee, on the
other hand, (x) the maturity of the obligations guaranteed hereby may be
accelerated as provided in Section 6.02 hereof for the purposes of this
Subsidiary Guarantee, notwithstanding any stay, injunction or other prohibition
preventing such acceleration in respect of the obligations guaranteed hereby and
(y) in the event of any declaration of acceleration of such obligations as
provided in Section 6.02 hereof, such obligations (whether or not due and
payable) shall forthwith become due and payable by the Subsidiary Guarantors for
the purpose of this Subsidiary Guarantee. The Subsidiary Guarantors shall have
the right to seek contribution from any non-paying Subsidiary Guarantor so long
as the exercise of such right does not impair the rights of the Holders under
the Subsidiary Guarantee.

Section 10.02.    LIMITATION ON SUBSIDIARY GUARANTOR LIABILITY.
                  --------------------------------------------

                  Each Subsidiary Guarantor, and by its acceptance of Notes,
each Holder, hereby confirms that it is the intention of all such parties that
the Subsidiary Guarantee of such Subsidiary Guarantor not constitute a
fraudulent transfer or conveyance for purposes of Bankruptcy Law, the Uniform
Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar
federal or state law to the extent applicable to any Subsidiary Guarantee. To
effectuate the foregoing intention, the Trustee, the Holders and the Subsidiary
Guarantors hereby irrevocably agree that the obligations of such Subsidiary
Guarantor under this Article 10 shall be limited to the maximum amount as shall,
after giving effect to such maximum amount and all other contingent and fixed
liabilities of such Subsidiary Guarantor that are relevant under such laws,
including, if applicable, its guarantee of all obligations under the Credit
Agreement, and after giving effect to any collections from, rights to receive
contribution from or payments made by or on behalf of any other Subsidiary
Guarantor in respect of the obligations of such other Subsidiary Guarantor under
this Article 10, result in the obligations of such Subsidiary Guarantor under
its Subsidiary Guarantee not constituting a fraudulent transfer or conveyance.

Section 10.03.    EXECUTION AND DELIVERY OF SUBSIDIARY GUARANTEE.
                  ----------------------------------------------

                  To evidence its Subsidiary Guarantee set forth in Section
10.01 hereof, each Subsidiary Guarantor hereby agrees that a notation of such
Subsidiary Guarantee in substantially the form included in Exhibit E shall be
endorsed by an Officer of such Subsidiary Guarantor on each Note authenticated
and delivered by the Trustee and that this Indenture shall be executed on behalf
of such Subsidiary Guarantor by its President or one of its Vice Presidents.

                  Each Subsidiary Guarantor hereby agrees that its Subsidiary
Guarantee set forth in Section 10.01 hereof shall remain in full force and
effect notwithstanding any failure to endorse on each Note a notation of such
Subsidiary Guarantee.

                  If an Officer whose signature is on this Indenture or on the
Subsidiary Guarantee no longer holds that office at the time the Trustee
authenticates the Note on which a Subsidiary Guarantee is endorsed, the
Subsidiary Guarantee shall be valid nevertheless.

                  The delivery of any Note by the Trustee, after the
authentication thereof hereunder, shall constitute due delivery of the
Subsidiary Guarantee set forth in this Indenture on behalf of the Subsidiary
Guarantors.



                                       64


Section 10.04.    SUBSIDIARY GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN TERMS.
                  -------------------------------------------------------------

                  Except as otherwise provided in Section 10.05 hereof, no
Subsidiary Guarantor may consolidate with or merge with or into (whether or not
such Subsidiary Guarantor is the surviving Person) another Person whether or not
affiliated with such Subsidiary Guarantor unless:

                  (a) subject to Section 10.05 hereof, the Person formed by or
surviving any such consolidation or merger (if other than a Subsidiary Guarantor
or the Company) unconditionally assumes all the obligations of such Subsidiary
Guarantor, pursuant to a supplemental indenture in form and substance reasonably
satisfactory to the Trustee, under this Indenture, the Subsidiary Guarantee and
the Registration Rights Agreement on the terms set forth herein or therein; and

                  (b) the Subsidiary Guarantor complies with the requirements of
Article 5 hereof.

                  In case of any such consolidation, merger, sale or conveyance
and upon the assumption by the successor Person, by supplemental indenture,
executed and delivered to the Trustee and satisfactory in form to the Trustee,
of the Subsidiary Guarantee endorsed upon the Notes and the due and punctual
performance of all of the covenants and conditions of this Indenture to be
performed by the Subsidiary Guarantor, such successor Person shall succeed to
and be substituted for the Subsidiary Guarantor with the same effect as if it
had been named herein as a Subsidiary Guarantor. Such successor Person thereupon
may cause to be signed any or all of the Subsidiary Guarantees to be endorsed
upon all of the Notes issuable hereunder which theretofore shall not have been
signed by the Company and delivered to the Trustee. All the Subsidiary
Guarantees so issued shall in all respects have the same legal rank and benefit
under this Indenture as the Subsidiary Guarantees theretofore and thereafter
issued in accordance with the terms of this Indenture as though all of such
Subsidiary Guarantees had been issued at the date of the execution hereof.

                  Except as set forth in Articles 4 and 5 hereof, and
notwithstanding clauses (a) and (b) above, nothing contained in this Indenture
or in any of the Notes shall prevent any consolidation or merger of a Subsidiary
Guarantor with or into the Company or another Subsidiary Guarantor, or shall
prevent any sale or conveyance of the property of a Subsidiary Guarantor as an
entirety or substantially as an entirety to the Company or another Subsidiary
Guarantor.

Section 10.05.    RELEASES FOLLOWING SALE OF ASSETS.
                  ---------------------------------

                  In the event of a sale or other disposition of all of the
assets of any Subsidiary Guarantor, by way of merger, consolidation or
otherwise, or a sale or other disposition of all to the capital stock of any
Subsidiary Guarantor, in each case to a Person that is not (either before or
after giving effect to such transactions) a Subsidiary of the Company, then such
Subsidiary Guarantor (in the event of a sale or other disposition, by way of
merger, consolidation or otherwise, of all of the capital stock of such
Subsidiary Guarantor) or the corporation acquiring the property (in the event of
a sale or other disposition of all or substantially all of the assets of such
Subsidiary Guarantor) shall be released and relieved of any obligations under
its Subsidiary Guarantee; provided that the net proceeds of such sale or other
disposition are applied in accordance with the applicable provisions of this
Indenture, including without limitation Section 4.12 hereof. Upon delivery by
the Company to the Trustee of an Officers' Certificate and an Opinion of Counsel
to the effect that such sale or other disposition was made by the Company in
accordance with the provisions of this Indenture, including without limitation
Section 4.12 hereof, the Trustee shall execute any documents reasonably required
in order to evidence the release of any Subsidiary Guarantor from its
obligations under its Subsidiary Guarantee.

                  Any Subsidiary Guarantor not released from its obligations
under its Subsidiary Guarantee shall remain liable for the full amount of
principal of and interest on the Notes and for the other obligations of any
Subsidiary Guarantor under this Indenture as provided in this Article 10.



                                       65


                                  ARTICLE 11.

                           SATISFACTION AND DISCHARGE

Section 11.01.    SATISFACTION AND DISCHARGE.
                  --------------------------

                  This Indenture will be discharged and will cease to be of
further effect as to all Notes issued hereunder, when:

                  (a) either:

                (i) all Notes that have been authenticated (except lost, stolen
          or destroyed Notes that have been replaced or paid and Notes for whose
          payment money has theretofore been deposited in trust and thereafter
          repaid to the Company) have been delivered to the Trustee for
          cancellation; or

                (ii) all Notes that have not been delivered to the Trustee for
          cancellation have become due and payable by reason of the making of a
          notice of redemption or otherwise or will become due and payable
          within one year and the Company has irrevocably deposited or caused to
          be deposited with the Trustee as trust funds in trust solely for the
          benefit of the Holders, cash in U.S. dollars and non-callable
          Government Securities, or a combination thereof, in such amounts as
          will be sufficient without consideration of any reinvestment of
          interest, to pay and discharge the entire indebtedness on the Notes
          not delivered to the Trustee for cancellation for principal, premium,
          if any, and accrued interest and Additional Interest, if any, to the
          date of maturity or redemption;

                  (b) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit or shall occur as a result of such
deposit and such deposit will not result in a breach or violation of, or
constitute a default under, any other instrument to which the Company or any
Subsidiary Guarantor is a party or by which the Company or any Subsidiary
Guarantor is bound;

                  (c) the Company has paid or caused to be paid all sums payable
by it under this Indenture; and

                  (d) the Company has delivered irrevocable instructions to the
Trustee under this Indenture to apply the deposited money and/or non-callable
Government Securities toward the payment of the Notes at maturity or the
redemption date, as the case may be.

                  The Company shall deliver an Officers' Certificate and an
Opinion of Counsel to the Trustee stating that all conditions precedent to
satisfaction and discharge have been satisfied.

Section 11.02.    DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN
                  TRUST; OTHER MISCELLANEOUS PROVISIONS.
                  -------------------------------------------------------

                  Subject to Section 11.03 hereof, all money and U.S. Government
Obligations (including the proceeds thereof) deposited with the Trustee (or
other qualifying trustee, collectively for purposes of this Section 11.02, the
"Trustee") pursuant to Section 11.01 hereof in respect of the outstanding Notes
shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal, premium, if any, and interest and
Additional Interest, if any,, but such money need not be segregated from other
funds except to the extent required by law.

Section 11.03.    REPAYMENT TO COMPANY.
                  --------------------

                  Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, in trust for the payment of the principal of, premium,
if any, or interest or Additional Interest on any Note and remaining unclaimed
for two years after such principal, and premium, if any, or interest has become
due and payable shall be



                                       66


paid to the Company on its request or (if then held by the Company) shall be
discharged from such trust; and the Holder shall thereafter look only to the
Company for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Company as
trustee thereof, shall thereupon cease; provided, however, that the Trustee or
such Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in The New York Times and The
Wall Street Journal (national edition), notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such notification or publication, any unclaimed balance of such
money then remaining will be repaid to the Company.

                                  ARTICLE 12.

                                  MISCELLANEOUS

Section 12.01.    TRUST INDENTURE ACT CONTROLS.
                  ----------------------------

                  If any provision of this Indenture limits, qualifies or
conflicts with the duties imposed by TIA ss. 318(c), the imposed duties shall
control.

Section 12.02.    NOTICES.
                  -------

                  Any notice or communication by the Company or the Trustee to
the others is duly given if in writing and delivered in Person or mailed by
first class mail (registered or certified, return receipt requested), telecopier
or overnight air courier guaranteeing next-day delivery, to the other's address:


                  If to the Company:

                  Extendicare Health Services, Inc.
                  111 West Michigan Street
                  Milwaukee, WI  53203
                  Attention:  Chief Financial Officer
                  Telecopier No.:  (414) 908-8111

                  With a copy to:
                  Foley & Lardner
                  777 East Wisconsin Avenue
                  Milwaukee, WI  53202-5367
                  Attention:  Russell E. Ryba
                  Telecopier No.:  (414) 297-4900

                  If to the Trustee:

                  U.S. Bank, N.A.
                  1555 North RiverCenter Drive, Suite 301
                  Milwaukee, WI  53212
                  Attention:  Steven J. Peterson
                  Telecopier No.:  (414) 905-5049

                  The Company or the Trustee, by notice to the others, may
designate additional or different addresses for subsequent notices or
communications.

                  All notices and communications (other than those sent to
Holders and the Trustee) shall be deemed to have been duly given: at the time
delivered by hand, if personally delivered; five Business Days after being
deposited in the mail, postage prepaid, if mailed; when receipt acknowledged, if
telecopied; and the next Business Day after timely delivery to the courier, if
sent by overnight air courier guaranteeing next-day delivery. All notices and
communications to the Trustee shall be deemed duly given and effective only upon
receipt.

                                       67


                  Any notice or communication to a Holder shall be mailed by
first class mail, certified or registered, return receipt requested, or by
overnight air courier guaranteeing next-day delivery to its address shown on the
Security Register. Any notice or communication shall also be so mailed to any
Person described in TIA ss. 313(c), to the extent required by the TIA. Failure
to mail a notice or communication to a Holder or any defect in it shall not
affect its sufficiency with respect to other Holders.

                  If a notice or communication is mailed in the manner provided
above within the time prescribed, it is duly given, whether or not the addressee
receives it.

                  If the Company mails a notice or communication to Holders, it
shall mail a copy to the Trustee and each Agent at the same time.

Section 12.03.    COMMUNICATION BY HOLDERS OF NOTES WITH OTHER HOLDERS OF NOTES.
                  -------------------------------------------------------------

                  Holders may communicate pursuant to TIA ss. 312(b) with other
Holders with respect to their rights under this Indenture or the Notes. The
Company, the Trustee, the Registrar and anyone else shall have the protection of
TIA ss. 312(c).

Section 12.04.    CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
                  --------------------------------------------------

                  Upon any request or application by the Company to the Trustee
to take any action under any provision of this Indenture, the Company shall
furnish to the Trustee:

                  (a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 12.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been complied with; and

                  (b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 12.05 hereof) stating that, in the opinion of such counsel, all such
conditions precedent and covenants have been complied with.

Section 12.05.    STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
                  ---------------------------------------------

                  Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than a certificate
provided pursuant to TIA ss. 314(a)(4)) shall comply with the provisions of TIA
ss. 314(e) and shall include:

                  (a) a statement that the Person making such certificate or
opinion has read such covenant or condition;

                  (b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such certificate or opinion are based;

                  (c) a statement that, in the opinion of such Person, he or she
has made such examination or investigation as is necessary to enable such Person
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and

                  (d) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been complied with.

Section 12.06.    RULES BY TRUSTEE AND AGENTS.
                  ---------------------------

                  The Trustee may make reasonable rules for action by or at a
meeting of Holders. The Registrar or Paying Agent may make reasonable rules and
set reasonable requirements for its functions.



                                       68


Section 12.07.    NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND
                  STOCKHOLDERS.
                  -----------------------------------------------------------

                  No past, present or future director, officer, employee,
incorporator or stockholder of the Company or any Subsidiary Guarantor, as such,
shall have any liability for any obligations of the Company or of the Subsidiary
Guarantors under the Notes, this Indenture, the Subsidiary Guarantees or for any
claim based on, in respect of, or by reason of, such obligations or their
creation. Each Holder of Notes by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for issuance of
the Notes. Such waiver may not be effective to waive liabilities under the
federal securities laws and it is the view of the SEC that such a waiver is
against public policy.

Section 12.08.    GOVERNING LAW.
                  -------------

                  THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE
USED TO CONSTRUE THIS INDENTURE AND THE NOTES WITHOUT GIVING EFFECT TO
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF
THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

Section 12.09.    NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
                  ---------------------------------------------

                  This Indenture may not be used to interpret any other
indenture, loan or debt agreement of the Company or its Subsidiaries or of any
other Person. Any such indenture, loan or debt agreement may not be used to
interpret this Indenture.

Section 12.10.    SUCCESSORS.
                  ----------

                  All covenants and agreements of the Company in this Indenture
and the Notes shall bind its successors. All covenants and agreements of the
Trustee in this Indenture shall bind its successors.

Section 12.11.    SEVERABILITY.
                  ------------

                  In case any provision in this Indenture or in the Notes shall
be invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions shall not in any way be affected or impaired
thereby.

Section 12.12.    COUNTERPART ORIGINALS.
                  ---------------------
                  The parties may sign any number of copies of this Indenture.
Each signed copy shall be an original, but all of them together represent the
same agreement.

Section 12.13.    TABLE OF CONTENTS, HEADINGS, ETC.

                  The Table of Contents, Cross-Reference Table and Headings in
this Indenture have been inserted for convenience of reference only, are not to
be considered a part of this Indenture and shall in no way modify or restrict
any of the terms or provisions hereof.

                         [Signatures on following page]



                                                     SIGNATURE PAGE TO INDENTURE


                                                     SIGNATURE PAGE TO INDENTURE


                                       69


                                   SIGNATURES

Dated as of June 28, 2002

                       ISSUER:

                       EXTENDICARE HEALTH SERVICES, INC.


                       By: /s/  Mark W. Durishan
                           ----------------------------------------
                           Name:        Mark W. Durishan
                           Title:       Vice President, Chief Financial Officer
                                        and Treasurer




                     GUARANTORS:

                     EXTENDICARE HEALTH FACILITY HOLDINGS, INC.
                     EXTENDICARE HEALTH FACILITIES, INC.
                     COVENTRY CARE, INC.
                     NORTHERN HEALTH FACILITIES, INC.
                     EXTENDICARE HOMES, INC.
                     EXTENDICARE HEALTH NETWORK, INC.
                     THE PROGRESSIVE STEP CORPORATION
                     EXTENDICARE OF INDIANA, INC.
                     EDGEWOOD NURSING CENTER, INC.
                     ELDER CREST, INC.
                     HAVEN CREST, INC.
                     MEADOW CREST, INC.
                     OAK HILL HOME OF REST AND CARE, INC.
                     EXTENDICARE GREAT TRAIL, INC.
                     FIR LANE TERRACE CONVALESCENT CENTER, INC.
                     ADULT SERVICES UNLIMITED, INC.
                     ARBORS EAST, INC.
                     ARBORS AT TOLEDO, INC.
                     HEALTH POCONOS, INC.
                     MARSHALL PROPERTIES, INC.
                     COVENTRY CARE HOLDINGS, INC.
                     UNITED PROFESSIONAL SERVICES, INC.

                     By: /s/  Mark W. Durishan
                        --------------------------------------------------

                     Name:    Mark W. Durishan
                     Title:   Vice President, Chief Financial Officer and
                              Treasurer



                                       70




                     INDIANA HEALTH AND REHABILITATION PARTNERSHIP

                     BY:  EXTENDICARE HOMES, INC., AS GENERAL PARTNER


                     By: /s/  Mark W. Durishan
                       --------------------------------------------------

                     Name:    Mark W. Durishan
                     Title:   Vice President, Chief Financial Officer and
                              Treasurer


                     BY:  EXTENDICARE OF INDIANA, INC., AS GENERAL PARTNER


                     By: /s/  Mark W. Durishan
                        --------------------------------------------------

                     Name:    Mark W. Durishan
                     Title:   Vice President, Chief Financial Officer and
                              Treasurer

                     CONCORDIA MANOR, LLC
                     FIRST COAST HEALTH AND REHABILITATION CENTER, LLC
                     JACKSON HEIGHTS REHABILITATION CENTER, LLC
                     TREASURE ISLE CARE CENTER, LLC

                     BY:  EXTENDICARE HOMES, INC., AS SOLE MEMBER


                     By: /s/  Mark W. Durishan
                        --------------------------------------------------

                     Name:    Mark W. Durishan
                     Title:   Vice President, Chief Financial Officer and
                              Treasurer


                     KAUFMAN STREET, WV, LLC
                     NEW CASTLE CARE, LLC

                     BY:  FIR LANE TERRACE CONVALESCENT CENTER, INC., AS SOLE
                          MEMBER


                     By: /s/  Mark W. Durishan
                        --------------------------------------------------

                     Name:    Mark W. Durishan
                     Title:   Vice President, Chief Financial Officer and
                              Treasurer




                                       71




                     ALPINE HEALTH AND REHABILITATION CENTER, LLC
                     COLONIAL CARE, LLC
                     GREENBRIAR CARE, LLC
                     GREENBROOK CARE, LLC
                     HERITAGE CARE, LLC LADY
                     LAKE CARE, LLC
                     NEW HORIZON CARE, LLC
                     NORTH REHABILITATION CARE, LLC
                     PALM COURT CARE, LLC
                     RICHEY MANOR, LLC
                     ROCKLEDGE CARE, LLC
                     SOUTH HERITAGE HEALTH AND REHABILITATION CENTER, LLC
                     THE OAKS RESIDENTIAL AND REHABILITATION CENTER, LLC
                     WINTER HAVEN HEALTH AND REHABILITATION CENTER, LLC

                     BY:  EXTENDICARE HEALTH FACILITIES, INC., AS SOLE MEMBER


                     By: /s/ Mark W. Durishan
                        --------------------------------------------------

                     Name:    Mark W. Durishan
                     Title:   Vice President, Chief Financial Officer and
                              Treasurer



                                       72


                     ARBORS AT TAMPA, LLC
                     ARBORS AT BAYONET POINT, LLC
                     ARBORS AT FAIRLAWN CARE, LLC
                     ARBORS AT FAIRLAWN REALTY OH, LLC
                     ARBORS AT SYLVANIA CARE, LLC
                     ARBORS AT SYLVANIA REALTY OH, LLC
                     ARBORS WEST CARE, LLC
                     ARBORS WEST REALTY OH, LLC
                     COLUMBUS REHABILITATION REALTY OH, LLC
                     JACKSONVILLE CARE, LLC
                     SAFETY HARBOR CARE, LLC
                     KISSIMMEE CARE, LLC
                     ORANGE PARK CARE, LLC
                     OREGON CARE, LLC
                     PORT CHARLOTTE CARE, LLC
                     SARASOTA CARE, LLC
                     SEMINOLE CARE, LLC
                     WINTER HAVEN CARE, LLC
                     BLANCHESTER CARE, LLC
                     CANTON CARE, LLC
                     COLUMBUS REHABILITATION CARE, LLC
                     DAYTON CARE, LLC
                     DELAWARE CARE, LLC
                     GALLIPOLIS CARE, LLC
                     HILLIARD CARE, LLC
                     LONDON CARE, LLC
                     MARIETTA CARE, LLC
                     ROCKMILL CARE, LLC
                     ROCKSPRINGS CARE, LLC
                     WATERVILLE CARE, LLC
                     WOODSFIELD CARE, LLC

                     BY:  NORTHERN HEALTH FACILITIES, INC., AS SOLE MEMBER


                     By:  /s/ Mark W. Durishan
                        --------------------------------------------------

                     Name:    Mark W. Durishan
                     Title:   Vice President, Chief Financial Officer and
                              Treasurer



                                       73




                     STONEBRIDGE CARE, LP
                     EDGEWOOD CARE, LP
                     ELDERCREST CARE, LP
                     HAVEN CARE, LP
                     MEADOW CARE, LP
                     OAK HILL CARE, LP

                     BY:  COVENTRY CARE HOLDINGS, INC., AS GENERAL PARTNER


                     By: /s/ Mark W. Durishan
                        --------------------------------------------------

                     Name:    Mark W. Durishan
                     Title:   Vice President, Chief Financial Officer and
                              Treasurer


                     GREAT TRAIL CARE, LLC

                     BY:  EXTENDICARE GREAT TRAIL, INC., AS SOLE MEMBER


                     By: /s/ Richard Bertrand
                        --------------------------------------------------

                     Name:    Richard Bertrand
                     Title:   Senior Vice President - Development


                     FISCAL SERVICES GROUP, LLC
                     PARTNERS HEALTH GROUP, LLC

                     BY:  EXTENDICARE HEALTH NETWORK, INC., AS SOLE MEMBER


                     By: /s/ Richard Bertrand
                        --------------------------------------------------

                     Name:    Richard Bertrand
                     Title:   Senior Vice President - Development


                     MILFORD CARE, LLC

                     BY:  MARSHALL PROPERTIES, INC., AS SOLE MEMBER


                     By: /s/ Richard Bertrand
                        --------------------------------------------------

                     Name:    Richard Bertrand
                     Title:   Senior Vice President - Development




                                       74





                     PARTNERS HEALTH GROUP - FLORIDA, LLC
                     PARTNERS HEALTH GROUP - LOUISIANA, LLC
                     PARTNERS HEALTH GROUP - TEXAS, LLC

                     BY:  PARTNERS HEALTH GROUP, LLC

                     BY:  EXTENDICARE HEALTH NETWORK, INC., AS SOLE MEMBER


                     By:  /s/ Richard Bertrand
                        --------------------------------------------------

                     Name:    Richard Bertrand
                     Title:   Senior Vice President - Development




                                       75





                      TRUSTEE:


                      U.S. BANK, N.A.


                      By: /s/ Steven J. Peterson
                          ----------------------------------------
                           Name:        Steven J. Peterson
                           Title:       Trust Officer




                                       76




                                                                       EXHIBIT A


                                 (Face of Note)



                          9 1/2% SENIOR NOTES DUE 2010



                                                          CUSIP  _____________
NO. _____                                                       $_____________


                        EXTENDICARE HEALTH SERVICES, INC.

promises to pay to CEDE & CO., INC. or registered assigns, the principal sum of
_________________ Dollars ($______________) on July, 2010.

Interest Payment Dates:  January 1 and July 1, commencing January 1, 2003.

Record Dates:  December 15 and June 15.

Dated:  ______________, 20__.




                                      A-1


                  IN WITNESS WHEREOF, the Issuer has caused this Note to be
signed manually or by facsimile by its duly authorized officer.



                        EXTENDICARE HEALTH SERVICES, INC.


                        By:
                           --------------------------------------------------
                           Name:   Mark W. Durishan
                           Title:  Vice President, Chief Financial Officer and
                                   Treasurer







This is one of the [Global]
Notes referred to in the
within-mentioned Indenture:

[                                ]
as Trustee

By:
   ---------------------------------
    Authorized Signatory

Dated _____________, 20__




                                      A-2


                                 (Back of Note)

                          9 1/2% Senior Notes due 2010

[Insert the Global Note Legend, if applicable pursuant to the terms of the
Indenture]

[Insert the Private Placement Legend, if applicable pursuant to the terms of the
Indenture]

                  Capitalized terms used herein shall have the meanings assigned
to them in the Indenture referred to below unless otherwise indicated.

         1. INTEREST. Extendicare Health Services, Inc., a Delaware corporation
(the "ISSUER"), promises to pay interest on the principal amount of this Note at
9 1/2% per annum until maturity and shall pay Additional Interest, if any, as
provided in Section 5 of the Registration Rights Agreement. The Issuer shall pay
interest semi-annually on January 1 and July 1 of each year, or if any such day
is not a Business Day, on the next succeeding Business Day (each an "INTEREST
PAYMENT DATE"). Interest on the Notes shall accrue from the most recent date to
which interest has been paid or, if no interest has been paid, from the date of
issuance; provided, however, that if there is no existing Default in the payment
of interest, and if this Note is authenticated between a record date referred to
on the face hereof and the next succeeding Interest Payment Date, interest shall
accrue from such next succeeding Interest Payment Date; provided, further, that
the first Interest Payment Date shall be the first of January 1 or July 1 to
occur after the date of issuance, unless such January 1 or July 1 occurs within
one calendar month of such date of issuance, in which case the first Interest
Payment Date shall be the second of January 1 and July 1 to occur after the date
of issuance. The Issuer shall pay interest (including post-petition interest in
any proceeding under any Bankruptcy Law) on overdue principal and premium, if
any, from time to time on demand at a rate that is 1% per annum in excess of the
interest rate then in effect under the Indenture and this Note; it shall pay
interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue installments of interest (without regard to any
applicable grace periods) from time to time on demand at the same rate to the
extent lawful. Interest shall be computed on the basis of a 360-day year of
twelve 30-day months.

         2. METHOD OF PAYMENT. The Issuer shall pay interest on the Notes
(except defaulted interest) to the Persons who are Holders at the close of
business on the December 15 or June 15 next preceding the Interest Payment Date,
even if such Notes are cancelled after such record date and on or before such
Interest Payment Date, except as provided in Section 2.12 of the Indenture with
respect to defaulted interest. The Notes shall be payable as to principal,
premium, if any, and interest and Additional Interest, if any, at the office or
agency of the Issuer maintained for such purpose, or, at the option of the
Issuer, payment of interest may be made by check mailed to the Holders at their
addresses set forth in the Security Register; provided, however, that payment by
wire transfer of immediately available funds shall be required with respect to
principal of and interest and Additional Interest, if any, and premium, if any,
on, all Global Notes and all other Notes the Holders of which shall have
provided wire transfer instructions to the Issuer or the Paying Agent. Such
payment shall be in such coin or currency of the United States of America as at
the time of payment is legal tender for payment of public and private debts.

         3. PAYING AGENT AND REGISTRAR. Initially, U.S. Bank, N.A., the Trustee
under the Indenture, shall act as Paying Agent and Registrar. The Issuer may
change any Paying Agent or Registrar without notice to any Holder. The Issuer or
any of its Subsidiaries may act in any such capacity.

         4. INDENTURE. The Issuer issued the Notes under an Indenture dated as
of June 28, 2002 ("INDENTURE") among the Issuer, the guarantors party thereto
(the "GUARANTORS") and the Trustee. The terms of the Notes include those stated
in the Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (15 U.S. Code ss.ss. 77aaa-77bbbb). The Notes
are subject to all such terms, and Holders are referred to the Indenture and
such Act for a statement of such terms. To the extent any provision of this Note
conflicts with the express provisions of the Indenture, the provisions of the
Indenture shall govern and be controlling. The Notes are obligations of the
Issuer unlimited in aggregate principal amount.



                                      A-3


         5. MATURITY. The principal on the Notes shall be due and payable on
July 1, 2010.

         6. OPTIONAL REDEMPTION.

                  (a) Except as set forth in clause (b) of this Paragraph 6, the
Notes will not be redeemable at the option of the Issuer prior to July 1, 2006.
Starting on that date, the Issuer may redeem all or any portion of the Notes, at
once or over time, after giving the required notice under the Indenture. The
Notes may be redeemed at the redemption prices (expressed as percentages of
principal amount) set forth below, plus accrued and unpaid interest and
Additional Interest, if any, to the redemption date (subject to the right of
Holders on the relevant record date to receive interest due on the relevant
Interest Payment Date), if redeemed during the twelve-month period commencing on
July 1 of the years indicated below:



Year                                                            Percentage
- ----                                                            ----------
                                                               
2006........................................................      104.750%
2007........................................................      102.375%
2008 and thereafter.........................................      100.000%



                  (b) At any time and from time to time, prior to July 1, 2005,
the Issuer may redeem up to 35% of the aggregate principal amount of the Notes
issued under the Indenture at a redemption price equal to 109.500% of the
principal amount thereof, plus accrued and unpaid interest and Additional
Interest, if any, to the redemption date (subject to the right of Holders on the
relevant record date to receive interest due on the relevant Interest Payment
Date) with the net cash proceeds of any Qualified Equity Offering of the
Issuer's common stock; provided, however, that after giving effect to any such
redemption, at least 65% of the aggregate principal amount of the Notes issued
under the Indenture remains outstanding. Any such redemption shall be made
within 90 days of the closing of such Qualified Equity Offering upon not less
than 30 nor more than 60 days' prior notice.

                  (c) Any prepayment pursuant to this paragraph shall be made
pursuant to the provisions of Sections 3.01 through 3.06 of the Indenture.

         7. MANDATORY REDEMPTION. The Issuer shall not be required to make
mandatory redemption or sinking fund payments with respect to the Notes.

         8. REPURCHASE AT OPTION OF HOLDER.

         (a) Upon the occurrence of a Change of Control, each Holder shall have
the right to require the Issuer to repurchase all or any part (equal to $1,000
or an integral multiple of $1,000) of such Holder's Notes (a "CHANGE OF CONTROL
OFFER") at a purchase price equal to 101% of the principal amount thereof, plus
accrued and unpaid interest and Additional Interest, if any, to the purchase
date (subject to the right of Holders on the relevant record date to receive
interest due on the relevant Interest Payment Date).

         (b) If the Issuer or one of its Restricted Subsidiaries consummates any
Asset Sales, when the aggregate amount of Excess Proceeds exceeds $15.0 million,
the Issuer shall commence an offer to all Holders of Notes (an "ASSET SALE
OFFER") pursuant to Section 3.09 of the Indenture to purchase the maximum
principal amount of Notes (including any Additional Notes) that may be purchased
out of the Excess Proceeds at an offer price in cash equal to 100% of the
principal amount thereof plus accrued and unpaid interest and Additional
Interest thereon, if any, to the date fixed for the closing of such offer in
accordance with the procedures set forth in the Indenture. To the extent that
the aggregate amount of Notes (including Additional Notes) tendered pursuant to
an Asset Sale Offer is less than the Excess Proceeds, the Issuer (or such
Restricted Subsidiary) may use such deficiency for any purpose not otherwise
restricted by the Indenture. If the aggregate principal amount of Notes
surrendered by Holders thereof exceeds the amount of Excess Proceeds, the
Trustee shall select the Notes to be purchased on a pro rata basis. Holders of
Notes that are the subject of an offer to purchase will receive an Asset Sale
Offer from the Issuer prior to any related purchase date and may elect to have
such Notes purchased by completing the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Notes.



                                      A-4


         8. NOTICE OF REDEMPTION. Notice of redemption shall be mailed at least
30 days but not more than 60 days before the redemption date to each Holder
whose Notes are to be redeemed at its registered address. Notes in denominations
larger than $1,000 may be redeemed in part but only in whole multiples of
$1,000, unless all of the Notes held by a Holder are to be redeemed. On and
after the redemption date interest ceases to accrue on Notes or portions thereof
called for redemption.

         9. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form
without coupons in denominations of $1,000 and integral multiples of $1,000. The
transfer of Notes may be registered and Notes may be exchanged as provided in
the Indenture. The Registrar and the Trustee may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents and the
Issuer may require a Holder to pay any taxes and fees required by law or
permitted by the Indenture. The Issuer need not exchange or register the
transfer of any Note or portion of a Note selected for redemption, except for
the unredeemed portion of any Note being redeemed in part. Also, the Issuer need
not exchange or register the transfer of any Notes for a period of 15 days
before a selection of Notes to be redeemed or during the period between a record
date and the corresponding Interest Payment Date.

         10. PERSONS DEEMED OWNERS. The registered holder of a Note may be
treated as its owner for all purposes.

         11. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions,
the Issuer and the Trustee may amend or supplement the Indenture or the Notes
with the consent of the Holders of at least a majority in principal amount of
the then outstanding Notes voting as a single class, and any existing default or
compliance with any provision of the Indenture or the Notes may be waived with
the consent of the Holders of a majority in principal amount of the then
outstanding Notes voting as a single class. Without the consent of any Holder,
the Issuer and the Trustee may amend or supplement the Indenture or the Notes to
cure any ambiguity, defect or inconsistency, to provide for the assumption by a
successor corporation of the obligations of the Issuer under the Indenture in
the case of a merger or consolidation or sale of all or substantially all of the
assets of the Issuer, provide for uncertificated Notes in addition to or in
place of certificated Notes, to make any change that would provide any
additional rights or benefits to the Holders of Notes or that does not adversely
affect the legal rights under the Indenture of any such Holder, or to make any
change to comply with any requirement of the SEC in order to effect or maintain
the qualification of the Indenture under the TIA.

         12. DEFEASANCE PRIOR TO MATURITY. Subject to certain conditions, the
Issuer at any time may terminate some or all of its obligations under the Notes
and the Indenture if the Issuer deposits with the Trustee for the benefit of the
Holders of the Notes, cash in U.S. dollars, non-callable Government Securities
or a combination of cash in U.S. dollars and non-callable Government Securities,
in amounts as will be sufficient, in the opinion of a nationally recognized firm
of independent public accountants, to pay the principal of, and interest and
premium and Additional Interest, if any, on the Notes on the Stated Maturity or
on the applicable redemption date, as the case may be.

         13. DEFAULTS AND REMEDIES. Each of the following is an Event of Default
under the Indenture: (1) default for 30 days in the payment when due of interest
on, or Additional Interest with respect to, the Notes; (2) default in payment
when due of principal of, or premium, if any, on the Notes; (3) failure by the
Issuer or any of its Restricted Subsidiaries to comply with Sections 4.09 or
4.10 or Article 5 of the Indenture; (4) failure by the Issuer or any of its
Restricted Subsidiaries for 30 days after notice to comply with Sections 4.12
and 4.18; (5) failure by the Issuer or any of its Restricted Subsidiaries for 60
days after notice to comply with any of its other agreements or covenants in the
Indenture or in the Notes; (6) default under any mortgage, indenture or
instrument under which there may be issued or by which there may be secured or
evidenced any Indebtedness for money borrowed by the Issuer or any of its
Restricted Subsidiaries (or the payment of which is guaranteed by the Issuer or
any of its Restricted Subsidiaries) whether such Indebtedness or guarantee now
exists, or is created after the date of the Indenture, if that default (A) is
caused by a failure to pay principal of, or interest or premium, if any, on such
Indebtedness prior to the expiration of the grace period provided in such
Indebtedness on the date of such default (a "PAYMENT DEFAULT"); or (B) results
in the acceleration of such Indebtedness prior to its express maturity; and in
each such case, the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness under which there has been a
Payment Default or the maturity of which has been so accelerated, aggregates
$20.0 million or more; (7) failure by the Issuer or any of its Restricted
Subsidiaries to pay final judgments (to the extent not fully covered by
insurance) aggregating in excess of $20.0 million, which judgments



                                      A-5


are not paid, discharged or stayed for a period of 60 consecutive days; (8)
except as permitted by the Indenture, any Subsidiary Guarantee shall be held in
any judicial proceeding to be unenforceable or invalid or shall cease for any
reason to be in full force and effect or any Subsidiary Guarantor, or any Person
acting on behalf of any Subsidiary Guarantor, shall deny or disaffirm its
obligations under its Subsidiary Guarantee or (9) certain events of bankruptcy
or insolvency described in the Indenture with respect to the Issuer or any of
its Restricted Subsidiaries. If any Event of Default occurs and is continuing,
the Trustee or the Holders of at least 25% in principal amount of the then
outstanding Notes may declare all the Notes to be due and payable.
Notwithstanding the foregoing, in the case of an Event of Default arising from
certain events of bankruptcy or insolvency described in the Indenture, all
outstanding Notes shall become due and payable without further action or notice.
Holders may not enforce the Indenture or the Notes except as provided in the
Indenture. Subject to certain limitations, Holders of a majority in aggregate
principal amount of the then outstanding Notes may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Holders notice of
any continuing Default or Event of Default (except a Default or Event of Default
relating to the payment of principal or interest or Additional Interest) if it
determines that withholding notice is in their interest. The Holders of a
majority in aggregate principal amount of the Notes then outstanding by notice
to the Trustee may on behalf of the Holders of all of the Notes waive any
existing Default or Event of Default and its consequences under the Indenture
except a continuing Default or Event of Default in the payment of interest or
Additional Interest on, or the principal of, the Notes. The Issuer is required
to deliver to the Trustee annually a statement regarding compliance with the
Indenture, and the Issuer is required upon becoming aware of any Default or
Event of Default, to deliver to the Trustee a statement specifying such Default
or Event of Default.

         14. TRUSTEE DEALINGS WITH ISSUER. The Trustee, in its individual or any
other capacity, may make loans to, accept deposits from, and perform services
for the Issuer or its Affiliates, and may otherwise deal with the Issuer or its
Affiliates, as if it were not the Trustee.

         15. DESIGNATED SENIOR DEBT. The Issuer hereby designates the Notes as
"Designated Senior Debt" as that term is defined in the Senior Subordinated Note
Indenture.

         16. NO RECOURSE AGAINST OTHERS. No director, officer, employee,
incorporator or stockholder of the Issuer or of any Subsidiary Guarantor, as
such, shall have any liability for any obligations of the Issuer or any
Subsidiary Guarantor under the Indenture, the Notes, the Subsidiary Guarantees
or for any claim based on, in respect of, or by reason of, such obligations or
their creation. Each Holder by accepting a Note waives and releases all such
liability. The waiver and release are part of the consideration for the issuance
of the Notes; such waiver may not be effective to waive liabilities under the
federal securities laws and it is the view of the SEC that such a waiver is
against public policy.

         17. AUTHENTICATION. This Note shall not be valid until authenticated by
the manual signature of the Trustee or an authenticating agent.

         18. ABBREVIATIONS. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (=
tenants by the entireties), JT TEN (= joint tenants with right of survivorship
and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).

         19. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Issuer has caused
CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers
in notices of redemption as a convenience to Holders. No representation is made
as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.

                  The Issuer shall furnish to any Holder upon written request
and without charge a copy of the Indenture. Requests may be made to:

                  Extendicare Health Services, Inc.
                  111 West Michigan Street
                  Milwaukee, WI  53203
                  Attention:  Chief Financial Officer



                                      A-6




                       Option of Holder to Elect Purchase

If you want to elect to have this Note purchased by the Issuer pursuant to
Section 4.12 or 4.18 of the Indenture, check the box below:

[ ]         Section 4.12

[ ]         Section 4.18

If you want to elect to have only part of the Note purchased by the Issuer
pursuant to Section 4.12 or Section 4.18 of the Indenture, state the amount you
elect to have purchased: $_____________________

Date:___________________       Your Signature:________________________________
                               (Sign exactly as your name appears on the Note)

                               Tax Identification No.:

                               ------------------------------------------------


                               SIGNATURE GUARANTEE:


                               ------------------------------------------------

                               Signatures must be guaranteed by an "eligible
                               guarantor institution" meeting the requirements
                               of the Registrar, which requirements include
                               membership or participation in the Security
                               Transfer Agent Medallion Program ("STAMP") or
                               such other "signature guarantee program" as may
                               be determined by the Registrar in addition to, or
                               in substitution for, STAMP, all in accordance
                               with the Securities Exchange Act of 1934, as
                               amended.







                                      A-7




                                 ASSIGNMENT FORM

To assign this Note, fill in the form below:


(I) or (we) assign and transfer this Note to


- ------------------------------------------------------------------------------
               (Insert assignee's soc. sec. or other tax I.D. no.)

- -----------------------------------------------------------------------------

- ------------------------------------------------------------------------------

- ------------------------------------------------------------------------------

- ------------------------------------------------------------------------------

- ------------------------------------------------------------------------------
             (Print or type assignee's name, address and zip code)
and irrevocably appoint
                       -------------------------------------------------------
as agent to transfer this Note on the books of the Issuer.  The agent may
substitute another to act for him.

- ------------------------------------------------------------------------------

Date: ______________
                             Your Signature:
                                            ----------------------------------
                             (Sign exactly as your name appears on the face of
                             this Note)

                             Signature Guarantee:
                                                  ----------------------------




                                      A-8


              SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE

                  The following exchanges of a part of this Global Note for an
interest in another Global Note or for a Definitive Note, or exchanges of a part
of another Global Note or Definitive Note for an interest in this Global Note,
have been made:



                                                                           Principal Amount
                                Amount of                                 of this Global Note       Signature of
                               decrease in         Amount of increase       following such      authorized signatory
                            Principal Amount      in Principal Amount        decrease (or           of Trustee or
    Date of Exchange       of this Global Note    of this Global Note          increase)           Note Custodian
    ----------------       -------------------    -------------------          ---------           --------------
                                                                                    

EX-4.4

                                                              EXECUTIVE VERSION

                                                              EXHIBIT 4.4





                   EXCHANGE AND REGISTRATION RIGHTS AGREEMENT



                            Dated as of June 28, 2002



                                      among



                       Extendicare Health Services, Inc.,



          The Subsidiary Guarantors from time to time party hereto, and



            Lehman Brothers Inc., on behalf of the Initial Purchasers













                   EXCHANGE AND REGISTRATION RIGHTS AGREEMENT

                  This Exchange and Registration Rights Agreement (this
"Agreement") is made and entered into as of June 28, 2002 by and among
Extendicare Health Services, Inc., a Delaware corporation (the "Company"), the
Subsidiary Guarantors (as defined herein) and Lehman Brothers Inc. on behalf of
U.S. Bancorp Piper Jaffray Inc. and ABN AMRO Incorporated (collectively, the
"Initial Purchasers").

                  This Agreement is made pursuant to the Purchase Agreement,
dated June 20, 2002 (the "Purchase Agreement"), by and among the Company, the
Existing Subsidiary Guarantors (as defined herein) and the Initial Purchasers,
which provides for the sale by the Company to the Initial Purchasers of
$150,000,000 aggregate principal amount of the Company's 9 1/2% Senior Notes due
2010 (the "Notes"). The Notes are, and the Exchange Notes (as defined herein)
will be, guaranteed on a senior basis by the Subsidiary Guarantors (as defined
herein). In order to induce the Initial Purchasers to purchase the Notes, the
Company and the Existing Subsidiary Guarantors have agreed to provide the
registration rights set forth in this Agreement. The execution and delivery of
this Agreement is a condition to the obligations of the Initial Purchasers set
forth in Section 7 of the Purchase Agreement.

                  The parties hereby agree as follows:

         SECTION 1.            DEFINITIONS

                  As used in this Agreement, the following capitalized terms
shall have the following meanings:

                  Additional Subsidiary Guarantor: Any subsidiary of the Company
that executes a Guarantee under the Indenture after the date of this Agreement.

                  Advice:  As defined in Section 6(e) hereof.

                  Blackout Period:  As defined in Section 5(a) hereof.

                  Blue Sky Application:  As defined in Section 8(a) hereof.

                  Broker-Dealer: Any broker or dealer registered under the
Exchange Act.

                  Closing Date:  The date of this Agreement.

                  Commission:  The U.S. Securities and Exchange Commission.

                  Company:  As defined in the preamble hereto.

                  Consummate:  A Registered Exchange Offer shall be deemed
"Consummated" for purposes of this Agreement upon the occurrence of (i) the
filing and effectiveness under the Securities Act of the Exchange Offer
Registration Statement













                                                                      2






relating to the Exchange Notes to be issued in the Exchange Offer, (ii) the
maintenance of such Registration Statement continuously effective and the
keeping of the Exchange Offer open for a period not less than the minimum period
required pursuant to Section 3(b) hereof, and (iii) the delivery by the Company
to the Registrar under the Indenture of Exchange Notes in the same aggregate
principal amount as the aggregate principal amount of Notes that were tendered
by Holders thereof pursuant to the Exchange Offer.

                  Damages Payment Date: With respect to the Notes, each Interest
Payment Date.

                  Exchange Act: The U.S. Securities Exchange Act of 1934, as
amended.

                  Exchange Notes: The Company's 9 1/2% Senior Notes due 2010 to
be issued pursuant to the Indenture in the Exchange Offer, together with the
related Guarantees.

                  Exchange Offer: The registration by the Company under the
Securities Act of the Exchange Notes pursuant to a Registration Statement
pursuant to which the Company offers the Holders of all outstanding Transfer
Restricted Securities the opportunity to exchange all such outstanding Transfer
Restricted Securities held by such Holders for Exchange Notes in an aggregate
principal amount equal to the aggregate principal amount of the Transfer
Restricted Securities validly tendered in such exchange offer by such Holders.

                  Exchange Offer Registration Statement: The Registration
Statement relating to the Exchange Offer, including the related Prospectus.

                  Existing Subsidiary Guarantors: The various Subsidiary
Guarantors signatory to the Indenture as of the date hereof.

                  Guarantees: Guarantees by the Subsidiary Guarantors of the
Company's obligations under the Notes, the Exchange Notes and the Indenture.

                  Holders:  As defined in Section 2(b) hereof.

                  Indenture: The Indenture, dated as of the date hereof, among
the Company, the Existing Subsidiary Guarantors and U.S. Bank, N.A., as trustee
(the "Trustee"), pursuant to which the Notes and the Exchange Notes are to be
issued, as such Indenture may be amended or supplemented from time to time in
accordance with the terms thereof.

                  Initial Purchasers:  As defined in the preamble hereto.

                  Interest Payment Date: As defined in the Indenture and the
Notes.

                  NASD:  National Association of Securities Dealers, Inc.















                                                                      3






                  Notes:  As defined in the preamble hereto.

                  Person: An individual, partnership, corporation, limited
liability company, unincorporated organization, association, joint-stock
company, trust, joint venture, government or any agency or political subdivision
thereof or any other entity.

                  Prospectus: The prospectus included in a Registration
Statement as amended or supplemented by any prospectus supplement and by all
other amendments thereto, including post-effective amendments, and all material
incorporated by reference into such Prospectus.

                  Purchase Agreement:  As defined in the preamble hereto.

                  Record Holder: With respect to any Damages Payment Date
relating to Notes, each Person who is a Holder of Notes on the record date with
respect to the Interest Payment Date on which such Damages Payment Date shall
occur.

                  Registration Default:  As defined in Section 5(a) hereof.

                  Registration Statement: Any Registration Statement of the
Company relating to (a) an offering of Exchange Notes pursuant to an Exchange
Offer or (b) the registration for resale of Transfer Restricted Securities
pursuant to the Shelf Registration Statement, which is filed pursuant to the
provisions of this Agreement, in each case including the Prospectus included
therein, all amendments and supplements thereto (including post-effective
amendments) and all exhibits and material incorporated by reference therein.

                  Securities Act:  The U.S. Securities Act of 1933, as amended.

                  Shelf Filing Deadline:  As defined in Section 4(a) hereof.

                  Shelf Registration Period:  As defined in Section 4(a) hereof.

                  Shelf Registration Statement:  As defined in Section 4(a)
hereof.

                  Subsidiary Guarantors: The Additional Subsidiary Guarantors
and the Existing Subsidiary Guarantors.

                  TIA: The U.S. Trust Indenture Act of 1939 (15 U.S.C. Section
77aaa-77bbbb) as in effect on the date of the Indenture.

                  Transfer Restricted Securities: Each Note or Exchange Note
(including the related Guarantees), as applicable, until the earliest to occur
of (a) the date on which such Note is exchanged by a person other than a
Broker-Dealer in the Exchange Offer in exchange for an Exchange Note, so long as
such person is not prohibited from reselling such Exchange Notes to the public
without delivering a prospectus and the Prospectus in the Exchange Offer
Registration Statement is not sufficient for such purpose, (b)













                                                                      4






following the exchange by a Broker-Dealer in the Exchange Offer of a Note for an
Exchange Note, the date on which that Exchange Note is sold to a purchaser who
receives from that Broker-Dealer on or prior to the date of such sale a copy of
the Prospectus contained in the Exchange Offer Registration Statement, (c) the
date on which such Note or Exchange Note has been effectively registered under
the Securities Act and disposed of in accordance with a Shelf Registration
Statement and (d) the date on which such Note is sold by the Holder pursuant to
Rule 144 under the Securities Act or is saleable pursuant to Rule 144(k) under
the Securities Act.

                  Underwritten Registration or Underwritten Offering: A
registration in which securities of the Company are sold to an underwriter for
reoffering to the public.

         SECTION 2.            SECURITIES SUBJECT TO THIS AGREEMENT

                  (a) Transfer Restricted Securities. The securities entitled to
the benefits of this Agreement are the Transfer Restricted Securities.

                  (b) Holders of Transfer Restricted Securities. A Person is
deemed to be a holder of Transfer Restricted Securities (each, a "Holder")
whenever such Person owns Transfer Restricted Securities.

         SECTION 3.            REGISTERED EXCHANGE OFFER

                  (a) Unless the Exchange Offer shall not be permissible under
applicable law or Commission policy (after the procedures set forth in Section
6(a) below have been complied with), the Company and the Subsidiary Guarantors
shall use (i) their reasonable best efforts to cause to be filed with the
Commission as soon as practicable after the Closing Date, but in no event later
than 90 days after the Closing Date, a Registration Statement under the
Securities Act relating to the Exchange Notes and the Exchange Offer, (ii) their
reasonable best efforts to cause such Registration Statement to be declared
effective on or prior to 150 days after the Closing Date, (iii) in connection
with the foregoing, file (A) all pre-effective amendments to such Registration
Statement as may be necessary in order to cause such Registration Statement to
become effective, (B) if applicable, a post-effective amendment to such
Registration Statement pursuant to Rule 430A under the Securities Act and (C)
cause all necessary filings in connection with the registration and
qualification of the Exchange Notes to be made under the blue sky laws of such
jurisdictions as are necessary to permit Consummation of the Exchange Offer and
(iv) upon the effectiveness of such Registration Statement, commence the
Exchange Offer. The Exchange Offer shall be on the appropriate form permitting
registration of the Exchange Notes to be offered in exchange for the Transfer
Restricted Securities and to permit resales of Exchange Notes held by
Broker-Dealers as contemplated by Section 3(c) below.

                  (b) The Company and the Subsidiary Guarantors shall use their
reasonable best efforts to cause the Exchange Offer Registration Statement to be
effective continuously and shall keep the Exchange Offer open for a period of
not less than the













                                                                      5






minimum period required under applicable U.S. Federal and state securities laws
to Consummate the Exchange Offer; provided, however, that in no event shall such
period be less than 20 business days. The Company and the Subsidiary Guarantors
shall cause the Exchange Offer to comply with all applicable U.S. federal and
state securities laws. No securities other than the Exchange Notes and the
Guarantees shall be included in the Exchange Offer Registration Statement. The
Company and the Subsidiary Guarantors shall use their reasonable best efforts to
cause the Exchange Offer to be Consummated within 30 business days after the
Exchange Offer Registration Statement has become effective.

                  (c) The Company and the Subsidiary Guarantors shall indicate
in a "Plan of Distribution" section of the Prospectus contained in the Exchange
Offer Registration Statement that any Broker-Dealer who holds Notes that are
Transfer Restricted Securities and that were acquired for its own account as a
result of market-making activities or other trading activities (other than
Transfer Restricted Securities acquired directly from the Company), may exchange
such Notes pursuant to the Exchange Offer; however, such Broker-Dealer may be
deemed to be an "underwriter" within the meaning of the Securities Act and must,
therefore, deliver a Prospectus meeting the requirements of the Securities Act
in connection with any resales of the Exchange Notes received by such
Broker-Dealer in the Exchange Offer, which Prospectus delivery requirement may
be satisfied by the delivery by such Broker-Dealer of the Prospectus contained
in the Exchange Offer Registration Statement. Such "Plan of Distribution"
section shall also contain all other information with respect to such resales by
Broker-Dealers that the Commission may require in order to permit such resales
pursuant thereto, but such "Plan of Distribution" shall not name any such
Broker-Dealer or disclose the amount of Notes held by any such Broker-Dealer
except to the extent required by the Commission.

                  The Company and the Subsidiary Guarantors shall use their
reasonable best efforts to keep the Exchange Offer Registration Statement
continuously effective, supplemented and amended as required by the provisions
of Section 6(c) below to the extent necessary to ensure that it is available for
resales of Exchange Notes acquired by Broker-Dealers for their own accounts as a
result of market-making activities or other trading activities, and to ensure
that it conforms with the requirements of this Agreement, the Securities Act and
the policies, rules and regulations of the Commission as announced from time to
time, for a period of at least 90 days after the Consummation of the Exchange
Offer.

                  The Company and the Subsidiary Guarantors shall provide
sufficient copies of the latest version of such Prospectus to Broker-Dealers
promptly upon request at any time during such 90-day period in order to
facilitate such resales.

         SECTION 4.            SHELF REGISTRATION

                  (a) Shelf Registration. If (i) the Company and the Subsidiary
Guarantors are not required to file an Exchange Offer Registration Statement or
cannot














                                                                      6






Consummate the Exchange Offer because the Exchange Offer is not permitted by
applicable U.S. law or Commission policy (after the procedures set forth in
Section 6(a) below have been complied with) or (ii) if any Holder of Transfer
Restricted Securities shall notify the Company prior to the 20th day following
the Consummation of the Exchange Offer that such Holder (A) is prohibited by
applicable U.S. law or Commission policy from participating in the Exchange
Offer, (B) may not resell the Exchange Notes acquired by it in the Exchange
Offer to the public without delivering a prospectus and that the Prospectus
contained in the Exchange Offer Registration Statement is not appropriate or
available for such resales by such Holder or (C) is a Broker-Dealer and holds
Notes acquired directly from the Company or one of its affiliates, then the
Company and the Subsidiary Guarantors shall:

                  (x) use their reasonable best efforts to cause to be filed a
         Registration Statement pursuant to Rule 415 under the Securities Act,
         which may be an amendment to the Exchange Offer Registration Statement
         if permitted by the rules and regulations of the Commission (in either
         event, the "Shelf Registration Statement") on or prior to the earliest
         to occur of (1) the 30th day after the date on which the Company
         determine that they are not required to file the Exchange Offer
         Registration Statement, or permitted to Consummate the Exchange Offer
         and (2) the 30th day after the date on which the Company receive notice
         from a Holder of Transfer Restricted Securities as contemplated by
         clause (ii) of paragraph (a) above (such earliest date being the "Shelf
         Filing Deadline"), which Shelf Registration Statement shall provide for
         resales of all Transfer Restricted Securities by the Holders which
         shall have provided the information required pursuant to Section 4(b)
         hereof; and

                  (y) use their reasonable best efforts to cause such Shelf
         Registration Statement to be declared effective by the Commission on or
         before the 90th day after the Shelf Filing Deadline.

Subject to Section 5(b), the Company and the Subsidiary Guarantors shall use
their reasonable best efforts to keep such Shelf Registration Statement
continuously effective, supplemented and amended as required by the provisions
of Sections 6(b) and (c) hereof to the extent necessary to ensure that it is
available for resales of Notes or Exchange Notes by the Holders of Transfer
Restricted Securities entitled to the benefit of this Section 4(a), and to
ensure that it conforms with the requirements of this Agreement, the Securities
Act and the policies, rules and regulations of the Commission as announced from
time to time, for a period of at least two years following the Closing Date or
such shorter period that will terminate when all Notes or Exchange Notes covered
by the Shelf Registration Statement have been sold pursuant to the Shelf
Registration Statement (such period being the "Shelf Registration Period").

                  (b) Provision by Holders of Certain Information in Connection
with the Shelf Registration Statement. No Holder of Transfer Restricted
Securities may include any of its Transfer Restricted Securities in any Shelf
Registration Statement pursuant to this Agreement unless and until such Holder
furnishes to the Company in













                                                                      7






writing, within 20 days after receipt of a request therefor, such information as
the Company may reasonably request for use in connection with any Shelf
Registration Statement or Prospectus or preliminary Prospectus included therein.
No Holder of Transfer Restricted Securities shall be entitled to Additional
Interest pursuant to Section 5 hereof unless and until such Holder shall have
used its reasonable best efforts to provide all such reasonably requested
information. Each Holder as to which any Shelf Registration Statement is being
effected agrees to furnish promptly to the Company all information required to
be disclosed in order to make the information previously furnished to the
Company by such Holder not materially misleading.

         SECTION 5.            ADDITIONAL INTEREST

                  (a) If (i) any of the Registration Statements required by this
Agreement are not filed with the Commission on or prior to the date specified
for such filing in Sections 3(a) and 4(a), as applicable, (ii) any of such
required Registration Statements have not been declared effective by the
Commission on or prior to the date specified for such effectiveness in Sections
3(a) and 4(a), as applicable, (iii) the Exchange Offer has not been Consummated
within 30 business days, or longer, if required by federal securities laws,
after the Exchange Offer Registration Statement has been declared effective or
(iv) any Registration Statement required by this Agreement is filed and declared
effective but shall thereafter cease to be effective or fail to be usable in
connection with resales of Transfer Restricted Securities without being
succeeded immediately by a post-effective amendment to such Registration
Statement that cures such failure and that is itself immediately declared
effective (except as permitted in paragraph (b); such period of time during
which any such Registration Statement is not effective or any such Registration
Statement or the related Prospectus is not usable being referred to as a
"Blackout Period") (each such event referred to in clauses (i) through (iv), a
"Registration Default"), the Company and the Subsidiary Guarantors jointly and
severally agree to pay additional interest ("Additional Interest") to each
Holder of Transfer Restricted Securities adversely affected by such Registration
Default, in an amount equal to $.05 per week per $1,000 principal amount of
Transfer Restricted Securities held by such Holder with respect to the first
90-day period immediately following the occurrence of such Registration Default.
The amount of Additional Interest shall increase by an additional $.05 per week
per $1,000 principal amount of Transfer Restricted Securities with respect to
each subsequent 90-day period (or portion thereof) until all Registration
Defaults have been cured, up to a maximum amount of Additional Interest of $.50
per week per $1,000 principal amount of Transfer Restricted Securities. All
accrued Additional Interest shall be paid to Record Holders by the Company and
the Subsidiary Guarantors in the same manner as interest is paid under the
Notes. Following the cure of all Registration Defaults relating to any
particular Transfer Restricted Securities, the accrual of Additional Interest
with respect to such Transfer Restricted Securities will cease.

                  (b) A Registration Default referred to in Section 5(a)(iv)
shall be deemed not to have occurred and be continuing in relation to a
Registration Statement or the related Prospectus if (i) the Blackout Period has
occurred solely as a result of (x) the













                                                                      8






filing of a post-effective amendment to such Shelf Registration Statement to
incorporate annual audited financial information with respect to the Company
where such post-effective amendment is not yet effective and needs to be
declared effective to permit Holders to use the related Prospectus or (y) the
occurrence of other material events with respect to the Company that would need
to be described in such Registration Statement or the related Prospectus and
(ii) in the case of clause (y), the Company is proceeding promptly and in good
faith to amend or supplement (including by way of filing documents under the
Exchange Act which are incorporated by reference into the Registration
Statement) such Registration Statement and the related Prospectus to describe
such events; provided, however, that in any case if such Blackout Period occurs
for a continuous period in excess of 30 days, a Registration Default shall be
deemed to have occurred on the 31st day of such Blackout Period and Additional
Interest shall be payable in accordance with the above paragraph from the day
such Registration Default occurs until such Registration Default is cured or
until the Company is no longer required pursuant to this Agreement to keep such
Registration Statement effective or such Registration Statement or the related
Prospectus usable; provided, further, that in no event shall the total of all
Blackout Periods exceed 45 days in the aggregate of any 12-month period.

                  All payment obligations of the Company and the Subsidiary
Guarantors set forth in this section that are outstanding with respect to any
Transfer Restricted Security at the time such security ceases to be a Transfer
Restricted Security shall survive until such time as all such payment
obligations with respect to such security shall have been satisfied in full.

         SECTION 6.            REGISTRATION PROCEDURES

                  (a) Exchange Offer Registration Statement. In connection with
the Exchange Offer, the Company and the Subsidiary Guarantors shall comply with
all of the provisions of Section 6(c) below, shall use their reasonable best
efforts to effect such exchange to permit the sale of Transfer Restricted
Securities being sold in accordance with the intended method or methods of
distribution thereof, and shall comply with all of the following provisions:

                        (i) As a condition to its participation in the Exchange
         Offer pursuant to the terms of this Agreement, each Holder of Transfer
         Restricted Securities shall furnish, upon the request of the Company,
         prior to the Consummation thereof, a written representation to the
         Company and the Subsidiary Guarantors (which may be contained in the
         letter of transmittal contemplated by the Exchange Offer Registration
         Statement) to the effect that (A) it is not an affiliate of the
         Company, (B) it is not engaged in, and does not intend to engage in,
         and has no arrangement or understanding with any Person to participate
         in, a distribution of the Exchange Notes to be issued in the Exchange
         Offer and (C) it is acquiring the Exchange Notes in its ordinary course
         of business. In addition, all such Holders of Transfer Restricted
         Securities shall otherwise cooperate in the Company's and the
         Subsidiary Guarantors'















                                                                      9






         preparations for the Exchange Offer. Each Holder hereby acknowledges
         and agrees that any Broker-Dealer and any such Holder using the
         Exchange Offer to participate in a distribution of the securities to be
         acquired in the Exchange Offer (1) could not under Commission policy as
         in effect on the date of this Agreement rely on the position of the
         Commission enunciated in Exxon Capital Holdings Corporation (available
         May 13, 1988) and Morgan Stanley and Co., Inc. (available June 5,
         1991), as interpreted in the Commission's letter to Shearman & Sterling
         dated July 2, 1993, and similar no-action letters, and (2) must comply
         with the registration and prospectus delivery requirements of the
         Securities Act in connection with a secondary resale transaction and
         that such a secondary resale transaction should be covered by an
         effective Registration Statement containing the selling security holder
         information required by Item 507 or 508, as applicable, of Regulation
         S-K if the resales are of Exchange Notes obtained by such Holder in
         exchange for Notes acquired by such Holder directly from the Company.

                        (ii) Prior to effectiveness of the Exchange Offer
         Registration Statement, the Company and the Subsidiary Guarantors shall
         state to the Commission that the Company and the Subsidiary Guarantors
         are registering the Exchange Offer in reliance on the position of the
         Commission enunciated in Exxon Capital Holdings Corporation (available
         May 13, 1988) and Morgan Stanley and Co., Inc. (available June 5, 1991)
         and shall represent to the Commission that neither the Company nor any
         Subsidiary Guarantor has entered into any arrangement or understanding
         with any Person to distribute the Exchange Notes to be received in the
         Exchange Offer and that, to the best of the Company's and each
         Subsidiary Guarantor's information and belief, each Holder
         participating in the Exchange Offer is acquiring the Exchange Notes in
         its ordinary course of business and has no arrangement or understanding
         with any Person to participate in the distribution of the Exchange
         Notes received in the Exchange Offer; and

                        (iii) shall issue, upon the request of any Holder of
         Notes covered by the Exchange Offer, Exchange Notes, having an
         aggregate principal amount equal to the aggregate principal amount of
         Notes surrendered to the Company by such Holder in exchange therefor;
         such Exchange Notes to be registered in the name of such Holder or in
         the name of the purchaser(s) of such Exchange Notes, as the case may
         be; in return, the Notes held by such Holder shall be surrendered to
         the Company for cancellation.

                  (b) Shelf Registration Statement. In connection with the Shelf
Registration Statement, the Company and the Subsidiary Guarantors shall comply
with all the provisions of Section 6(c) below and shall use their reasonable
best efforts to effect such registration to permit the sale of the Transfer
Restricted Securities being sold in accordance with the intended method or
methods of distribution thereof, and pursuant thereto the Company and the
Subsidiary Guarantors will as expeditiously as possible prepare and file with
the Commission a Registration Statement relating to the registration on any
appropriate form under the Securities Act, which form shall be available for the













                                                                      10






sale of the Transfer Restricted Securities in accordance with the intended
method or methods of distribution thereof.

                  (c) General Provisions. In connection with any Registration
Statement and any Prospectus required by this Agreement to permit the sale or
resale of Transfer Restricted Securities (including, without limitation, any
Registration Statement and the related Prospectus required to permit resales of
Notes and Exchange Notes by Broker-Dealers), the Company and the Subsidiary
Guarantors shall:

                           (i) use their reasonable best efforts to keep such
         Registration Statement continuously effective and provide all requisite
         financial statements (including, if required by the Securities Act or
         any regulation thereunder, financial statements of any Subsidiary
         Guarantors) for the period specified in Sections 3 or 4 of this
         Agreement, as applicable; upon the occurrence of any event that would
         cause any such Registration Statement or the Prospectus contained
         therein (A) to contain a material misstatement or omission or (B) not
         to be effective and usable for resale of Transfer Restricted Securities
         during the period required by this Agreement, the Company and the
         Subsidiary Guarantors shall file promptly an appropriate amendment to
         such Registration Statement, in the case of clause (A), correcting any
         such misstatement or omission, and, in the case of either clause (A) or
         (B), use their reasonable best efforts to cause such amendment to be
         declared effective and such Registration Statement and the related
         Prospectus to become usable for their intended purpose(s) as soon as
         practicable thereafter. Notwithstanding the foregoing, the Company and
         the Subsidiary Guarantors may allow the Shelf Registration Statement to
         cease to become effective and usable if (x) the board of directors of
         the Company determines in good faith that it is in the best interests
         of the Company not to disclose the existence of or facts surrounding
         any proposed or pending material corporate transaction involving the
         Company or the Subsidiary Guarantors, and the Company notifies the
         Holders within two business days after such boards of directors make
         such determination or (y) the Prospectus contained in the Shelf
         Registration Statement contains an untrue statement of a material fact
         or omits to state a material fact necessary in order to make the
         statements made therein, in the light of the circumstances under which
         they were made, not misleading; provided that the two-year period
         referred to in Section 4(a) hereof during which the Shelf Registration
         Statement is required to be effective and usable shall be extended by
         the number of days during which such Registration Statement was not
         effective or usable pursuant to the foregoing provisions; and provided
         further that Additional Interest shall accrue on the Notes as provided
         in Section 5 hereof;

                           (ii) prepare and file with the Commission such
         amendments and post-effective amendments to the Registration Statement
         as may be necessary to keep the Registration Statement effective for
         the applicable period set forth in Sections 3 or 4 hereof, as
         applicable; cause the Prospectus to be supplemented by any required
         Prospectus supplement, and as so supplemented to be filed pursuant to
         Rule 424 under the Securities Act, and to comply fully with the
         applicable










                                                                      11






         provisions of Rules 424 and 430A under the Securities Act in a timely
         manner; and comply with the provisions of the Securities Act with
         respect to the disposition of all securities covered by such
         Registration Statement during the applicable period in accordance with
         the intended method or methods of distribution by the sellers thereof
         set forth in such Registration Statement or supplement to the
         Prospectus;

                           (iii) cooperate with the selling Holders of Transfer
         Restricted Securities and the underwriter(s), if any, to facilitate the
         timely preparation and delivery of certificates representing Transfer
         Restricted Securities to be sold and not bearing any restrictive
         legends; and enable such Transfer Restricted Securities to be in such
         denominations and registered in such names as the Holders or the
         underwriter(s), if any, may request at least two business days prior to
         any sale of Transfer Restricted Securities made by such underwriter(s);

                           (iv) use their reasonable best efforts to cause the
         Transfer Restricted Securities covered by the Registration Statement to
         be registered with or approved by such other governmental agencies or
         authorities as may be necessary to enable the seller or sellers thereof
         or the underwriter(s), if any, to consummate the disposition of such
         Transfer Restricted Securities;

                           (v) if any fact or event contemplated by clause
         (d)(i)(D) below shall exist or have occurred, prepare a supplement or
         post-effective amendment to the Registration Statement or related
         Prospectus or any document incorporated therein by reference or file
         any other required document so that, as thereafter delivered to the
         purchasers of Transfer Restricted Securities, the Prospectus will not
         contain an untrue statement of a material fact or omit to state any
         material fact necessary to make the statements made therein, in the
         light of the circumstances under which they were made, not misleading;

                           (vi) provide a CUSIP, CINS or ISIN number, as
         applicable, for all Transfer Restricted Securities not later than the
         effective date of the Registration Statement and provide the Trustee
         under the Indenture with printed certificates for the Transfer
         Restricted Securities which are in a form eligible for deposit with the
         depositary;

                           (vii) cooperate and assist in any filings required to
         be made with the NASD and in the performance of any due diligence
         investigation by any underwriter (including any "qualified independent
         underwriter") that is required to be retained in accordance with the
         rules and regulations of the NASD;

                           (viii) otherwise use their best efforts to comply
         with all applicable rules and regulations of the Commission, and make
         generally available to its security holders, as soon as practicable, a
         consolidated earnings statement meeting the requirements of Rule 158
         (which need not be audited) for the twelve-month period (A) commencing
         at the end of any fiscal quarter in which Transfer











                                                                      12






         Restricted Securities are sold to underwriters in a firm or best
         efforts Underwritten Offering or (B) if not sold to underwriters in
         such an offering, beginning with the first month of the Company's first
         fiscal quarter commencing after the effective date of the Registration
         Statement;

                           (ix) cause the Indenture to be qualified under the
         TIA not later than the effective date of the first Registration
         Statement required by this Agreement, and, in connection therewith,
         cooperate with the Trustee and the Holders of Notes and Exchange Notes
         to effect such changes to the Indenture as may be required for such
         Indenture to be so qualified in accordance with the terms of the TIA;
         and execute, and use their best efforts to cause the Trustee to
         execute, all documents that may be required to effect such changes and
         all other forms and documents required to be filed with the Commission
         to enable such Indenture to be so qualified in a timely manner; and

                           (x) provide promptly to any Holder upon such Holder's
         written request each document filed with the Commission pursuant to the
         requirements of Section 13 and Section 15 of the Exchange Act.

                  (d)      Additional Provisions Applicable to Shelf
Registration Statements.  In connection with each Shelf Registration Statement,
during the Shelf Registration Period, the Company and the Subsidiary
Guarantors shall:

                           (i) advise the underwriter(s), if any, and selling
         Holders of Transfer Restricted Securities promptly and, if requested by
         such Persons, to confirm such advice in writing, (A) when the
         Prospectus or any Prospectus supplement or post-effective amendment has
         been filed, and, with respect to the Shelf Registration Statement or
         any post-effective amendment thereto, when the same has become
         effective, (B) of any request by the Commission for amendments to the
         Shelf Registration Statement or amendments or supplements to the
         Prospectus or for additional information relating thereto, (C) of the
         issuance by the Commission of any stop order suspending the
         effectiveness of the Registration Statement under the Securities Act,
         of the suspension by any state securities commission of the
         qualification of the Transfer Restricted Securities for offering or
         sale in any jurisdiction or of the initiation of any proceeding for any
         of the preceding purposes and (D) of the existence of any fact or the
         happening of any event that requires the making of any additions to or
         changes in the Shelf Registration Statement or the Prospectus in order
         that the Shelf Registration Statement and the Prospectus do not contain
         an untrue statement of a material fact or omit to state a material fact
         necessary to make the statements made therein, in the light of the
         circumstances under which they were made, not misleading. If at any
         time the Commission shall issue any stop order suspending the
         effectiveness of the Shelf Registration Statement, or any U.S. state
         securities commission or other regulatory authority shall issue an
         order suspending the qualification or exemption from qualification of
         the Transfer Restricted Securities under U.S. state securities or blue
         sky laws, the Company and the Subsidiary Guarantors











                                                                      13






         shall use their reasonable best efforts to obtain the withdrawal or
         lifting of such order at the earliest possible time;

                           (ii) if requested in writing, furnish to each of the
         selling Holders of Transfer Restricted Securities and each of the
         underwriter(s), if any, before filing with the Commission, copies of
         any Shelf Registration Statement or any Prospectus included therein or
         any amendments or supplements to any such Shelf Registration Statement
         or Prospectus (including all documents incorporated by reference after
         the initial filing of such Shelf Registration Statement), which
         documents will be subject to the review of such Holders and
         underwriter(s), if any, for a period of at least five business days,
         and the Company and the Subsidiary Guarantors will not file any such
         Shelf Registration Statement or Prospectus or any amendment or
         supplement to any such Shelf Registration Statement or Prospectus
         (including all such documents incorporated by reference) if a selling
         Holder of Transfer Restricted Securities covered by such Shelf
         Registration Statement or the underwriter(s), if any, shall not have
         had an opportunity to review the Shelf Registration Statement as set
         forth above; such Holders and underwriter(s) shall be deemed to have
         reasonably objected to such filing if such Shelf Registration
         Statement, amendment, Prospectus or supplement, as applicable, as
         proposed to be filed, contains an untrue statement of a material fact
         or omits to state any material fact necessary to make the statements
         therein, in the light of the circumstances under which they were made,
         not misleading, or fails to comply with the applicable requirements of
         the Securities Act;

                           (iii) upon request, provide copies of any document
         that is to be incorporated by reference into a Shelf Registration
         Statement or Prospectus to the selling Holders and to the
         underwriter(s), make the Company's and the Subsidiary Guarantors'
         representatives available for discussion of such document and other
         customary due diligence matters, and include such information in such
         document prior to the filing thereof as such selling Holders or
         underwriter(s), if any, reasonably may request;

                           (iv) make available for inspection at reasonable
         times at each of the Company's principal place of business by the
         Holders of Transfer Restricted Securities, any underwriter
         participating in any disposition pursuant to such Shelf Registration
         Statement, and any attorney or accountant retained by such selling
         Holders or any of the underwriter(s) who shall certify to the Company
         and the Subsidiary Guarantors that they have a current intention to
         sell Transfer Restricted Securities pursuant to a Shelf Registration
         Statement, and, such relevant financial and other records, pertinent
         corporate documents and properties of the Company and the Subsidiary
         Guarantors as reasonably requested and cause the Company's and the
         Subsidiary Guarantors' officers, directors and employees to respond to
         such inquiries as shall be reasonably necessary, in the reasonable
         judgment of counsel to such Holders, to conduct a reasonable
         investigation; provided, however, that the foregoing inspection and
         information gathering shall











                                                                      14






         be coordinated on behalf of the selling Holders by one counsel
         designated by and on behalf of such Holders and, provided, further,
         that each such party shall be required to maintain in confidence and
         not disclose to any other Person any information or records reasonably
         designated by the Company in writing as being confidential, until such
         time as (A) such information becomes a matter of public record (whether
         by virtue of its inclusion in such Shelf Registration Statement or
         otherwise), (B) such Person shall be required so to disclose such
         information pursuant to a subpoena or order of any court or other
         governmental agency or body having jurisdiction over the matter
         (subject to the requirements of such order, and only after such Person
         shall have given the Company prompt prior written notice of such
         requirement) or (C) such information is required to be set forth in
         such Shelf Registration Statement or the Prospectus included therein or
         in an amendment to such Shelf Registration Statement or an amendment or
         supplement to such Prospectus in order that such Shelf Registration
         Statement, Prospectus, amendment or supplement, as the case may be,
         does not contain an untrue statement of a material fact or omit to
         state therein a material fact required to be stated therein or
         necessary to make the statements made therein not misleading;

                           (v) if requested by any selling Holders of Transfer
         Restricted Securities or the underwriter(s), if any, promptly
         incorporate in any Shelf Registration Statement or Prospectus pursuant
         to a supplement or post-effective amendment if necessary, such
         information as such selling Holders and underwriter(s), if any, may
         reasonably request to have included therein, including, without
         limitation, information relating to the "Plan of Distribution" of the
         Transfer Restricted Securities information with respect to the
         principal amount of Transfer Restricted Securities being sold to such
         underwriter(s), the purchase price being paid therefor and any other
         terms of the offering of the Transfer Restricted Securities to be sold
         in such offering; and make all required filings of such Prospectus
         supplement or post-effective amendment as soon as practicable after the
         Company are notified of the matters to be incorporated in such
         Prospectus supplement or post-effective amendment; provided, however,
         that the Company shall not be required to take any action pursuant to
         this Section 6(d)(v) that would, in the opinion of counsel for the
         Company reasonably satisfactory to the Initial Purchasers, violate
         applicable law;

                           (vi) deliver to each selling Holder of Transfer
         Restricted Securities and each of the underwriter(s), if any, without
         charge, as many copies of the Prospectus (including each preliminary
         Prospectus) and any amendment or supplement thereto as such Persons
         reasonably may request; the Company and the Subsidiary Guarantors
         hereby consent to the use of the Prospectus and any amendment or
         supplement thereto by each of the selling Holders and each of the
         underwriter(s), if any, in connection with the offering and the sale of
         the Transfer Restricted Securities covered by the Prospectus or any
         amendment or supplement thereto;













                                                                      15






                           (vii) furnish to each Holder whose Transfer
         Restricted Securities have been included in a Shelf Registration
         Statement in connection with such exchange or sale, without charge, at
         least one copy of the Registration Statement, as first filed with the
         Commission, and of each amendment thereto, including all documents
         incorporated by reference therein and all exhibits (including exhibits
         incorporated therein by reference);

                           (viii) enter into an underwriting agreement on not
         more than one occasion in the case of an offering pursuant to a Shelf
         Registration, and make such representations and warranties, and take
         all such other actions in connection therewith in order to expedite or
         facilitate the disposition of the Transfer Restricted Securities
         pursuant to any Registration Statement contemplated by this Agreement,
         all to such extent as may be reasonably requested by any Holder or
         Holders of Transfer Restricted Securities who hold at least 25% in
         aggregate principal amount of such class of Transfer Restricted
         Securities; provided that the Company and the Subsidiary Guarantors
         shall not be required to enter into any such agreement more than once
         with respect to all of the Transfer Restricted Securities and may delay
         entering into such agreement if the board of directors of each of the
         Company and the Subsidiary Guarantors determines in good faith that it
         is in the best interests of the Company and the Subsidiary Guarantors
         not to disclose the existence of or facts surrounding any proposed or
         pending material corporate transaction involving the Company and the
         Subsidiary Guarantors; and whether or not an underwriting agreement is
         entered into and whether or not the registration is an Underwritten
         Registration, the Company and the Subsidiary Guarantors shall:

                                    (A) furnish to the Initial Purchasers, the
         Holders of Transfer Restricted Securities who hold at least 25% in
         aggregate principal amount of such class of Transfer Restricted
         Securities and each underwriter, if any, in such substance and scope as
         they may reasonably request and as are customarily made in connection
         with an offering of debt securities pursuant to a Shelf Registration
         Statement (i) upon the effective date of the Shelf Registration
         Statement (and if such Shelf Registration Statement contemplates an
         Underwritten Offering of Transfer Restricted Securities upon the date
         of the closing under the underwriting agreement related thereto) and
         (ii) upon the filing of any amendment or supplement to the Shelf
         Registration Statement or any other document that is incorporated in
         the Shelf Registration Statement by reference and includes financial
         data with respect to a fiscal quarter or year:

                                    (1) a certificate, dated the date of
                  effectiveness of the Shelf Registration Statement signed by
                  (y) the respective chief executive officer, the respective
                  President or any Vice President and (z) the respective chief
                  financial officer of each of the Company and each of the
                  Subsidiary Guarantors confirming, as of the date thereof, the
                  matters set forth in Section 7(m) of the Purchase Agreement
                  and such other matters as such parties may reasonably request;












                                                                      16






                                    (2) an opinion, dated the date of
                  effectiveness of such Shelf Registration Statement, of
                  securities counsel for the Company covering matters similar to
                  those set forth in Section 7(d) of the Purchase Agreement and
                  such other matters as such parties may reasonably request, and
                  in any event including a statement to the effect that such
                  counsel has participated in conferences with officers and
                  other representatives of the Company, representatives of the
                  independent public accountants for the Company, the Initial
                  Purchasers' representatives and the Initial Purchasers'
                  counsel in connection with the preparation of such Shelf
                  Registration Statement and the related Prospectus although
                  such counsel has not independently verified the accuracy,
                  completeness or fairness of such statements in such Shelf
                  Registration Statement; and that such counsel advises that, on
                  the basis of the foregoing, such counsel's work in connection
                  with this work did not disclose information that gave such
                  counsel reason to believe that the Shelf Registration
                  Statement, at the time such Shelf Registration Statement or
                  any post-effective amendment thereto became effective
                  contained an untrue statement of a material fact or omitted to
                  state a material fact required to be stated therein or
                  necessary to make the statements therein not misleading, or
                  that the Prospectus contained in such Shelf Registration
                  Statement as of its date contained an untrue statement of a
                  material fact or omitted to state a material fact necessary in
                  order to make the statements made therein, in the light of the
                  circumstances under which they were made, not misleading. Such
                  counsel may state further that such counsel expresses no view
                  with respect to, and has not independently verified, the
                  accuracy, completeness or fairness of the financial
                  statements, notes and schedules, the financial projections and
                  other financial, statistical and accounting data included or
                  incorporated by reference in the Shelf Registration Statement
                  contemplated by this Agreement or the related Prospectus; and

                                    (3) a customary comfort letter, dated as of
                  the date of effectiveness of the Shelf Registration Statement
                  from the Company's independent accountants, in the customary
                  form and covering matters of the type customarily covered in
                  comfort letters to underwriters in connection with primary
                  underwritten offerings, and affirming the matters set forth in
                  the comfort letters delivered pursuant to Sections 7(i) and
                  7(j) of the Purchase Agreement;

                                    (B) set forth in full or incorporated by
         reference in the underwriting agreement, if any, the indemnification
         provisions and procedures of Section 8 hereof with respect to all
         parties to be indemnified pursuant to said Section; and

                                    (C) deliver such other documents and
         certificates as may be reasonably requested by such parties to evidence
         compliance with clause (A) above and with any customary conditions
         contained in the underwriting










                                                                      17






         agreement or other agreement entered into by the Company and the
         Subsidiary Guarantors pursuant to this clause (viii), if any.

If at any time during the Shelf Registration Period the representations and
warranties of the Company or the Subsidiary Guarantors contemplated in clause
(A)(1) above cease to be true and correct, the Company or the Subsidiary
Guarantors shall so advise the Initial Purchasers and the underwriters, if any,
and each selling Holder promptly and, if requested by such Persons, shall
confirm such advice in writing; and

                           (ix) prior to any public offering of Transfer
         Restricted Securities cooperate with the selling Holders of Transfer
         Restricted Securities the underwriter(s), if any, and their respective
         counsel in connection with the registration and qualification of the
         Transfer Restricted Securities under the securities or blue sky laws of
         such jurisdictions as the selling Holders of Transfer Restricted
         Securities or underwriter(s) may reasonably request and do any and all
         other acts or things necessary or advisable to enable the disposition
         in such jurisdictions of the Transfer Restricted Securities covered by
         the Shelf Registration Statement filed pursuant to Section 4 hereof;
         provided, however, that the Company and the Subsidiary Guarantors shall
         not be obligated to qualify as a foreign corporation in any
         jurisdiction in which it is not now so qualified or to take any action
         that would subject it to general consent to service of process, other
         than as to matters and transactions relating to the Shelf Registration
         Statement, in any jurisdiction where it is not now so subject.

                  (e) Each Holder agrees by acquisition of a Transfer Restricted
Security that, upon receipt of any notice from the Company of the existence of
any fact of the kind described in Section 6(d)(i) hereof, such Holder will
forthwith discontinue disposition of Transfer Restricted Securities pursuant to
the Shelf Registration Statement until such Holder's receipt of the copies of
the supplemented or amended Prospectus contemplated by Section 6(d)(vi) hereof,
or until it is advised in writing (the "Advice") by the Company that the use of
the Prospectus may be resumed, and has received copies of any additional or
supplemental filings that are incorporated by reference in the Prospectus. If so
directed by the Company, each Holder will deliver to the Company (at the
Company's expense) all copies, other than permanent file copies then in such
Holder's possession, of the Prospectus covering such Transfer Restricted
Securities that was current at the time of receipt of such notice. In the event
the Company shall give any such notice, the time period regarding the
effectiveness of such Shelf Registration Statement set forth in Section 4
hereof, as applicable, shall be extended by the number of days during the period
from and including the date of the giving of such notice pursuant to Section
6(d)(i) hereof to and including the date when each selling Holder covered by
such Shelf Registration Statement shall have received the copies of the
supplemented or amended Prospectus contemplated by Section 6(d)(vi) hereof or
shall have received the Advice.

                  (f) The Company and the Subsidiary Guarantors may require each
Holder of Transfer Restricted Securities as to which any registration is being
effected to












                                                                      18






furnish to the Company such information regarding such Holder and such Holder's
intended method of distribution of the applicable Transfer Restricted Securities
as the Company may from time to time reasonably request in writing, but only to
the extent that such information is required in order to comply with the
Securities Act. Each such Holder agrees to notify the Company as promptly as
practicable of (i) any inaccuracy or change in information previously furnished
by such Holder to the Company or (ii) the occurrence of any event, in either
case, as a result of which any Prospectus relating to such registration contains
or would contain an untrue statement of a material fact regarding such Holder or
such Holder's intended method of distribution of the applicable Transfer
Restricted Securities or omits to state any material fact regarding such Holder
or such Holder's intended method of distribution of the applicable Transfer
Restricted Securities required to be stated therein or necessary to make the
statements made therein, in the light of the circumstances under which they were
made, not misleading and promptly to furnish to the Company any additional
information required to correct and update any previously furnished information
or required so that such Prospectus shall not contain, with respect to such
Holder or the distribution of the applicable Transfer Restricted Securities 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.

         SECTION 7.            REGISTRATION EXPENSES

                  (a) All expenses incident to the Company's and the Subsidiary
Guarantors' performance of or compliance with this Agreement will be borne by
the Company regardless of whether a Registration Statement becomes effective,
including without limitation and as applicable: (i) all Commission, securities
exchange or NASD registration and filing fees and expenses (including filings
made by any Initial Purchasers or Holder with the NASD (and, if applicable, the
fees and expenses of any "qualified independent underwriter" and its counsel
that may be required by the rules and regulations of the NASD)); (ii) all fees
and expenses of compliance with U.S. federal securities and state blue sky or
securities laws and compliance with the rules of the NASD (including reasonable
fees and disbursements of one counsel for Holders in connection with blue sky
and/or NASD qualification of the Exchange Notes); (iii) all expenses of printing
(including printing certificates for the Exchange Notes to be issued in the
Exchange Offer and printing of Prospectuses), messenger and delivery services;
(iv) all fees and disbursements of counsel for the Company and the Subsidiary
Guarantors; (v) all fees and disbursements of independent certified public
accountants of the Company (including the expenses of any special audit and
comfort letters required by or incident to such performance) and (vi) the
reasonable fees and disbursements of one firm of counsel designated by the
Holders of a majority in principal amount of Transfer Restricted Securities
covered by the Shelf Registration Statement to act as counsel for the Holders of
those Transfer Restricted Securities in connection therewith.

                  The Company will, in any event, bear their and the Subsidiary
Guarantors' internal expenses (including, without limitation, all salaries and
expenses of its officers and employees performing legal or accounting duties),
the expenses of any annual audit














                                                                      19






and the fees and expenses of any Person, including special experts, retained by
the Company or the Subsidiary Guarantors.

                  (b) Each Holder of Transfer Restricted Securities will pay all
underwriting discounts, if any, and commissions and transfer taxes, if any,
relating to the disposition of such Holder's Transfer Restricted Securities.

         SECTION 8.            INDEMNIFICATION

                  (a) The Company and each Subsidiary Guarantor shall, jointly
and severally, indemnify and hold harmless each Holder of Transfer Restricted
Securities, its officers and employees and each Person, if any, who controls any
such Holders, within the meaning of the Securities Act, from and against any
loss, claim, damage or liability, joint or several, or any action in respect
thereof (including, but not limited to, any loss, claim, damage, liability or
action relating to purchases, sales and registration of the Notes, the
Guarantees and the Exchange Notes), to which that Holder, officer, employee or
controlling Person may become subject, under the Securities Act or otherwise,
insofar as such loss, claim, damage, liability or action arises out of, or is
based upon (i) any untrue statement or alleged untrue statement of a material
fact contained (A) in any Registration Statement or preliminary Prospectus or
Prospectus or in any amendment or supplement thereto, (B) in any Blue Sky
Application (as defined below) or other document prepared or executed by any
Company or any Subsidiary Guarantor (or based upon any written information
furnished by any Company or any Subsidiary Guarantor) specifically for the
purpose of qualifying any or all of the Notes under the securities laws of any
state or other jurisdiction (any such application, document or information being
hereinafter called a "Blue Sky Application") or (C) in any materials or
information provided to investors by, or with the approval of, the Company in
connection with the marketing of the offering of the Exchange Notes ("Marketing
Materials"), including any roadshow or investor presentations made to investors
by the Company (whether in person or electronically); (ii) the omission or
alleged omission to state in any Registration Statement, preliminary Prospectus
or Prospectus, or in any amendment or supplement thereto, or in any Blue Sky
Application or Marketing Materials any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, or (iii) any act or failure to act or
any alleged act or failure to act by any Holder of Transfer Restricted
Securities in connection with, or relating in any manner to, the Notes, the
Guarantees or the Exchange Notes or the offering contemplated by any
Registration Statement, and which is included as part of or referred to in any
loss, claim, damage, liability or action arising out of or based upon matters
covered by clause (i) or (ii) above (provided that the Company and the
Subsidiary Guarantors shall not be liable under this clause (iii) to the extent
that it is determined in a final judgment by a court of competent jurisdiction
that such loss, claim, damage, liability or action resulted directly from any
such acts or failures to act undertaken or omitted to be taken by such Holder
through its gross negligence or willful misconduct); and shall reimburse each
Holder and each such officer, employee or controlling Person promptly upon
demand for any legal or other expenses reasonably incurred by that Holder,
officer, employee or controlling Person in connection with investigating or
defending or












                                                                      20






preparing to defend against any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that the Company and the
Subsidiary Guarantors shall not be liable in any such case to the extent that
any such loss, claim, damage, liability or action arises out of, or is based
upon, any untrue statement or alleged untrue statement or omission or alleged
omission made in any Registration Statement, preliminary Prospectus or
Prospectus, or in any such amendment or supplement, or in any Blue Sky
Application or Marketing Materials, in reliance upon and in conformity with
written information concerning such Holder furnished to the Company by or on
behalf of any Holder specifically for inclusion therein; provided, further, that
with respect to any such untrue statement or omission made in any preliminary
Prospectus or Prospectus, the indemnity agreement contained in this Section 8(a)
shall not inure to the benefit of the Holder from whom the Person asserting any
such losses, claims, damages or liabilities purchased the Notes, Guarantees or
Exchange Notes concerned if, to the extent that such sale was a sale by the
Holder and any such loss, claim, damage or liability of such Holder is a result
of the fact that both (A) a copy of the Prospectus (or the Prospectus as then
amended or supplemented) was not sent or given to such Person at or prior to
written confirmation of the sale of such Notes or Exchange Notes to such Person
and (B) the untrue statement or omission in the preliminary Prospectus or
Prospectus was corrected in the Prospectus (or the Prospectus as then amended or
supplemented) unless such failure to deliver the Prospectus was a result of
noncompliance by the Company with Section 6(d)(vi) hereof. The foregoing
indemnity agreement is in addition to any liability which the Company and the
Subsidiary Guarantors may otherwise have to any Holder or to any officer,
employee or controlling Person of that Holder.

                  (b) Each Holder, severally and not jointly, shall indemnify
and hold harmless each of the Company, each of the Subsidiary Guarantors, their
respective directors, officers and employees, and each Person, if any, who
controls either of the Company or any of the Subsidiary Guarantors within the
meaning of the Securities Act, from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof, to which the
Company, the Subsidiary Guarantors or any such director, officer or controlling
Person may become subject, under the Securities Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon
(i) any untrue statement or alleged untrue statement of a material fact
contained (A) in any Registration Statement, preliminary Prospectus or
Prospectus, or in any amendment or supplement thereto or (B) in any Blue Sky
Application or (ii) the omission or alleged omission to state in any
Registration Statement, preliminary Prospectus or Prospectus, or in any
amendment or supplement thereto, or in any Blue Sky Application any material
fact required to be stated therein or necessary to make the statements therein
not misleading, but in each case only to the extent that the untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with written information concerning such Holders
furnished to the Company by or on behalf of that Holder specifically for
inclusion therein, which information consists of the information specified in
Section 8(e) of the Purchase Agreement, and shall reimburse the Company, each of
the Subsidiary Guarantors and each such director, officer, employee and
controlling Person for any legal or other expenses reasonably incurred by the













                                                                      21






Company, each such Subsidiary Guarantor or each such director, officer, employee
or controlling Person in connection with investigating or defending or preparing
to defend against any such loss, claim, damage, liability or action as such
expenses are incurred. The foregoing indemnity agreement is in addition to any
liability which any Holder may otherwise have to the Company, any of the
Subsidiary Guarantors or any such director, officer, employee or controlling
Person.

                  (c) Promptly after receipt by an indemnified party under this
Section 8 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 8 except to the extent it has
been materially prejudiced by such failure and; provided, further, that the
failure to notify the indemnifying party shall not relieve it from any liability
which it may have to an indemnified party otherwise than under this Section 8.
If any such claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly with
any other similarly notified indemnifying party, to assume the defense thereof
with counsel reasonably satisfactory to the indemnified party. After notice from
the indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, any
indemnified party shall have the right to employ separate counsel in any such
action and to participate in the defense thereof but the fees and expenses of
such counsel shall be at the expense of the indemnified party unless (i) the
employment of such counsel has been specifically authorized by the indemnifying
party in writing, or (ii) such indemnified party shall have been advised by such
counsel that there may be one or more legal defenses available to it which are
different from or additional to those available to the indemnifying party and in
the reasonable judgment of such counsel it is advisable for such indemnified
party to employ separate counsel or (iii) the indemnifying party has failed to
assume the defense of such action and employ counsel reasonably satisfactory to
the indemnified party, in which case, if such indemnified party notifies the
indemnifying party in writing that it elects to employ separate counsel at the
expense of the indemnifying party, the indemnifying party shall not, in
connection with any one such action or separate but substantially similar or
related actions arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate firm of
attorneys (in addition to local counsel) at any time for all such indemnified
parties, which firm shall be designated in writing by (x) Lehman Brothers Inc.
if the indemnified parties under this Section 8 consist of the Initial
Purchasers or any of their respective officers, employees or controlling Persons
or (y) by the Company, if the indemnified parties under this Section 8 consist
of any of the Company, any of the Subsidiary Guarantors or any of their
respective directors, officers, employees or













                                                                      22






controlling Persons. No indemnifying party shall (i) without the prior written
consent of the indemnified parties (which consent shall not be unreasonably
withheld), settle or compromise or consent to the entry of any judgment with
respect to any pending or threatened claim, action, suit or proceeding in
respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising out
of such claim, action, suit or proceeding or (ii) be liable for any settlement
of any such action effected without its written consent (which consent shall not
be unreasonably withheld), but if settled with the consent of the indemnifying
party or if there be a final judgment of the plaintiff in any such action, the
indemnifying party agrees to indemnify and hold harmless any indemnified party
from and against any loss or liability by reason of such settlement or judgment.

                  (d) If the indemnification provided for in this Section 8
shall for any reason be unavailable to or insufficient to hold harmless an
indemnified party under Section 8(a) or 8(b) in respect of any loss, claim,
damage or liability, or any action in respect thereof, referred to therein, then
each indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Company and the Subsidiary Guarantors, on the one hand, and the
Holders on the other, from the sale of the Transfer Restricted Securities or
(ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company and the Subsidiary Guarantors, on the one hand and the Holders on
the other with respect to the statements or omissions which resulted in such
loss, claim, damage or liability, or action in respect thereof, as well as any
other relevant equitable considerations. The relative fault shall be determined
by reference to whether the untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to
information supplied by the Company or any of the Subsidiary Guarantors, on the
one hand, or the Holders, on the other hand, the intent of the parties and their
relative knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company, the Subsidiary Guarantors and the
Holders agree that it would not be just and equitable if contributions pursuant
to this Section 8(d) were to be determined by pro rata allocation (even if the
Holders were treated as one entity for such purpose) or by any other method of
allocation which does not take into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as a
result of the loss, claim, damage or liability, or action in respect thereof,
referred to above in this Section shall be deemed to include, for purposes of
this Section 8(d), any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Section 8(d), no Holder shall
be required to contribute any amount in excess of the amount by which the net
proceeds received by it in connection with its sale of Notes exceeds the amount
of













                                                                      23






any damages which such Holder has otherwise paid or become liable to pay by
reason of the untrue or alleged untrue statement or omission or alleged
omission. No Person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any Person who was not guilty of such fraudulent misrepresentation. The Holders'
obligations to contribute as provided in this Section 8(d) are several and not
joint.

         SECTION 9.            RULE 144A

                  The Company and each Subsidiary Guarantor hereby agrees with
each Holder of Transfer Restricted Securities, during any period in which the
Company or such Subsidiary Guarantor is not subject to Section 13 or 15(d) of
the Exchange Act within the two-year period following the Closing Date, to make
available to any Holder or beneficial owner of Transfer Restricted Securities,
in connection with any sale thereof and any prospective purchaser of such
Transfer Restricted Securities from such Holder or beneficial owner, the
information required by Rule 144A(d)(4) under the Securities Act in order to
permit resales of such Transfer Restricted Securities pursuant to Rule 144A.

         SECTION 10.           PARTICIPATION IN UNDERWRITTEN REGISTRATIONS

                  No Holder may participate in any Underwritten Registration
hereunder unless such Holder (a) agrees to sell such Holder's Transfer
Restricted Securities on the basis provided in any underwriting arrangements
approved by the Persons entitled hereunder to approve such arrangements and (b)
completes and executes all reasonable questionnaires, powers of attorney,
indemnities, underwriting agreements, lock-up letters and other documents
required under the terms of such underwriting arrangements.

         SECTION 11.           SELECTION OF UNDERWRITERS

                  Subject to Section 6(d)(i), the Holders of Transfer Restricted
Securities covered by the Shelf Registration Statement who desire to do so may
sell such Transfer Restricted Securities in an Underwritten Offering at such
Holders' expense. In any such Underwritten Offering, the investment banker or
investment bankers and manager or managers that will administer the offering
will be selected by the Holders of a majority in aggregate principal amount of
the Transfer Restricted Securities included in such offering; provided that such
investment bankers and managers must be reasonably satisfactory to the Company.
























                                                                      24






         SECTION 12.           MISCELLANEOUS

                  (a) Remedies. The Company and the Subsidiary Guarantors agree
that monetary damages (including Additional Interest) would not be adequate
compensation for any loss incurred by reason of a breach by it of the provisions
of this Agreement and hereby agree to waive the defense in any action for
specific performance that a remedy at law would be adequate.

                  (b) No Inconsistent Agreements. Neither the Company nor any
Subsidiary Guarantor will, on or after the date of this Agreement, enter into
any agreement with respect to its securities that is inconsistent with the
rights granted to the Holders in this Agreement or otherwise conflicts with the
provisions hereof. Except as disclosed in the Offering Memorandum (as such term
is defined in the Purchase Agreement), neither the Company nor any Subsidiary
Guarantor has previously entered into any agreement granting any registration
rights with respect to its securities to any Person. The rights granted to the
Holders hereunder do not in any way conflict with and are not inconsistent with
the rights granted to the holders of the Company's or any Subsidiary Guarantor's
securities under any agreement in effect on the date hereof.

                  (c) Adjustments Affecting the Notes. The Company and the
Subsidiary Guarantors will not take any action, or permit any change to occur,
with respect to the Notes that would materially and adversely affect the ability
of the Holders to Consummate any Exchange Offer.

                  (d) Amendments and Waivers. The provisions of this Agreement
may not be amended, modified or supplemented, and waivers or consents to or
departures from the provisions hereof may not be given unless the Company have
obtained the written consent of Holders of a majority of the outstanding
principal amount of the Transfer Restricted Securities affected by such
amendment, modification, supplement, waiver or consent. Notwithstanding the
foregoing, a waiver or consent to departure from the provisions hereof that
relates exclusively to the rights of Holders whose securities are being tendered
pursuant to the Exchange Offer and that does not affect directly or indirectly
the rights of other Holders whose securities are not being tendered pursuant to
such Exchange Offer may be given by the Holders of a majority of the outstanding
principal amount of Transfer Restricted Securities being tendered or registered.

                  (e) Notices. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand-delivery, first-class
mail (registered or certified, return receipt requested), telex, facsimile or
air courier guaranteeing overnight delivery:

                      (i)      if to a Holder, at the address set forth on
         the records of the Registrar under the Indenture, with a copy to the
         Registrar under the Indenture; and


















                                                                      25





                      (ii)          if to the Company or the Subsidiary
                                    Guarantors to:

                                    Extendicare Health Services, Inc.
                                    111 West Michigan Street
                                    Milwaukee, Wisconsin  53203-2903
                                    Attention: Chief Executive Officer
                                    Fax:    (414) 908-8059


                                    with a copy to:

                                    Foley & Lardner
                                    777 East Wisconsin Avenue
                                    Milwaukee, Wisconsin  53202-5367
                                    Attention:  Russell E. Ryba, Esq.
                                    Fax:    (414) 297-4900

                  Any such notices and communications shall take effect at the
time of receipt thereof. The Company shall be entitled to act and rely upon any
notice or communication given or made by the Initial Purchasers.

                  Copies of all such notices, demands or other communications
shall be concurrently delivered by the Person giving the same to the Trustee at
the address specified in the Indenture.

                  (f) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties, including without limitation and without the need for an express
assignment, subsequent Holders; provided, however, that this Agreement shall not
inure to the benefit of or be binding upon a successor or assign of a Holder
unless and to the extent such successor or assign acquired Transfer Restricted
Securities from such Holder.

                  (g) Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.

                  (h) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.

                  (i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED, IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK.

                  (j) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or
















                                                                      26






unenforceable, the validity, legality and enforceability of any such provision
in every other respect and of the remaining provisions contained herein shall
not be affected or impaired thereby.

                  (k) Entire Agreement. This Agreement together with the other
Operative Documents (as defined in the Purchase Agreement) is intended by the
parties as a final expression of their agreement and intended to be a complete
and exclusive statement of the agreement and understanding of the parties hereto
in respect of the subject matter contained herein. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein with respect to the registration rights granted by the Company and the
Subsidiary Guarantors with respect to the Transfer Restricted Securities. This
Agreement supersedes all prior agreements and understandings between the parties
with respect to such subject matter.

                           (Signature pages follow.)
















































                                                                      27

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.

                               Very truly yours,

                               EXTENDICARE HEALTH SERVICES, INC.

                               By: /s/ Mark W. Durishan
                                  --------------------------------------------
                                  Name:  Mark W. Durishan
                                  Title: Vice President -- Finance



                               EXTENDICARE HEALTH FACILITY HOLDINGS, INC.
                               EXTENDICARE HEALTH FACILITIES, INC.
                               COVENTRY CARE, INC.
                               NORTHERN HEALTH FACILITIES, INC.
                               EXTENDICARE HOMES, INC.
                               EXTENDICARE HEALTH NETWORK, INC.
                               THE PROGRESSIVE STEP CORPORATION
                               EXTENDICARE OF INDIANA, INC.
                               EDGEWOOD NURSING CENTER, INC.
                               ELDER CREST, INC.
                               HAVEN CREST, INC.
                               MEADOW CREST, INC.
                               OAK HILL HOME OF REST AND CARE, INC.
                               EXTENDICARE GREAT TRAIL, INC.
                               FIR LANE TERRACE CONVALESCENT CENTER, INC.
                               ADULT SERVICES UNLIMITED, INC.
                               ARBORS EAST, INC.
                               ARBORS AT TOLEDO, INC.
                               HEALTH POCONOS, INC.
                               MARSHALL PROPERTIES, INC.
                               COVENTRY CARE HOLDINGS, INC.
                               UNITED PROFESSIONAL SERVICES, INC.

                               By: /s/ Mark W. Durishan
                                  --------------------------------------------

                               Name:  Mark W. Durishan
                               Title: Vice President -- Finance







                               INDIANA HEALTH AND REHABILITATION PARTNERSHIP
                                BY:  EXTENDICARE HOMES, INC., AS GENERAL PARTNER


                               By: /s/ Mark W. Durishan
                                  --------------------------------------------

                               Name:    Mark W. Durishan
                               Title:   Vice President -- Finance

                               BY:  EXTENDICARE OF INDIANA, INC., AS GENERAL
                                    PARTNER


                               By: /s/ Mark W. Durishan
                                  --------------------------------------------

                               Name:    Mark W. Durishan
                               Title:   Vice President -- Finance


                               CONCORDIA MANOR, LLC
                               FIRST COAST HEALTH AND REHABILITATION CENTER, LLC
                               JACKSON HEIGHTS REHABILITATION CENTER, LLC
                               TREASURE ISLE CARE CENTER, LLC

                               BY:  EXTENDICARE HOMES, INC., AS SOLE MEMBER


                               By: /s/ Mark W. Durishan
                                  ----------------------------------------------

                               Name:    Mark W. Durishan
                               Title:   Vice President -- Finance









                               KAUFMAN STREET, WV, LLC
                               NEW CASTLE CARE, LLC

                               BY:  FIR LANE TERRACE CONVALESCENT CENTER, INC.,
                                    AS SOLE MEMBER


                               By: /s/ Mark W. Durishan
                                  ----------------------------------------------

                               Name:    Mark W. Durishan
                               Title:   Vice President -- Finance


                               ALPINE HEALTH AND
                               REHABILITATION CENTER, LLC
                               COLONIAL CARE, LLC
                               GREENBRIAR CARE, LLC
                               GREENBROOK CARE, LLC
                               HERITAGE CARE, LLC
                               LADY LAKE CARE, LLC
                               NEW HORIZON CARE, LLC
                               NORTH REHABILITATION CARE, LLC
                               PALM COURT CARE, LLC
                               RICHEY MANOR, LLC
                               ROCKLEDGE CARE, LLC
                               SOUTH HERITAGE HEALTH AND REHABILITATION
                               CENTER, LLC
                               THE OAKS RESIDENTIAL AND REHABILITATION
                               CENTER, LLC
                               WINTER HAVEN HEALTH AND REHABILITATION
                               CENTER, LLC

                               BY:  EXTENDICARE HEALTH FACILITIES, INC.,
                                    AS SOLE MEMBER


                               By: /s/ Mark W. Durishan
                                  ----------------------------------------------

                               Name:    Mark W. Durishan
                               Title:   Vice President -- Finance









                               EDGEWOOD CARE, LP
                               ELDER CREST CARE, LP
                               HAVEN CARE, LP
                               MEADOW CARE, LP
                               OAK HILL CARE, LP

                               BY:  EXTENDICARE HEALTH FACILITIES, INC.,
                                    AS GENERAL PARTNER


                               By: /s/ Mark W. Durishan
                                  ----------------------------------------------

                               Name:    Mark W. Durishan
                               Title:   Vice President -- Finance


                               ARBORS AT TAMPA, LLC
                               ARBORS AT BAYONET POINT, LLC
                               ARBORS AT FAIRLAWN CARE, LLC
                               ARBORS AT FAIRLAWN REALTY OH, LLC
                               ARBORS AT SYLVANIA CARE, LLC
                               ARBORS AT SYLVANIA REALTY OH, LLC
                               ARBORS WEST CARE, LLC
                               ARBORS WEST REALTY OH, LLC
                               COLUMBUS REHABILITATION
                               REALTY OH, LLC
                               JACKSONVILLE CARE, LLC
                               SAFETY HARBOR CARE, LLC
                               KISSIMMEE CARE, LLC
                               ORANGE PARK CARE, LLC
                               OREGON CARE, LLC
                               PORT CHARLOTTE CARE, LLC
                               SARASOTA CARE, LLC
                               SEMINOLE CARE, LLC
                               WINTER HAVEN CARE, LLC
                               BLANCHESTER CARE, LLC
                               CANTON CARE, LLC
                               COLUMBUS HEALTH CARE, LLC
                               DAYTON CARE, LLC
                               DELAWARE CARE, LLC
                               GALLIPOLIS CARE, LLC
                               HILLIARD CARE, LLC
                               LONDON CARE, LLC
                               MARIETTA CARE, LLC
                               ROCKMILL CARE, LLC
                               ROCKSPRINGS CARE, LLC







                               WATERVILLE CARE, LLC
                               WOODSFIELD CARE, LLC

                               BY:  NORTHERN HEALTH FACILITIES, INC., AS
                                    SOLE MEMBER


                               By: /s/ Mark W. Durishan
                                  ----------------------------------------------

                               Name:    Mark W. Durishan
                               Title:   Vice President -- Finance


                               STONEBRIDGE CARE, LP

                               BY:  EXTENDICARE HOMES, INC., AS GENERAL PARTNER


                               By:  /s/ Mark W. Durishan
                                  ----------------------------------------------

                               Name:    Mark W. Durishan
                               Title:   Vice President -- Finance

                               BY:  COVENTRY CARE HOLDINGS, INC., AS
                                    GENERAL PARTNER


                               By:   /s/ Mark W. Durishan
                                  ----------------------------------------------

                               Name:    Mark W. Durishan
                               Title:   Vice President -- Finance


                               GREAT TRAIL CARE, LLC

                               BY:  EXTENDICARE GREAT TRAIL, INC., AS
                                    SOLE MEMBER


                               By:   /s/ Richard Bertrand
                                  ----------------------------------------------

                               Name:    Richard Bertrand
                               Title:   Senior Vice President -- Development









                               FISCAL SERVICES GROUP, LLC
                               PARTNERS HEALTH GROUP, LLC

                               BY:  EXTENDICARE HEALTH NETWORK, INC., AS
                                    SOLE MEMBER


                               By: /s/ Richard Bertrand
                                   ---------------------------------------------

                               Name:  Richard Bertrand
                               Title: Senior Vice President - Development


                               MILFORD CARE, LLC

                               BY:  MARSHALL PROPERTIES, INC., AS SOLE MEMBER


                               By: /s/ Richard Bertrand
                                   ---------------------------------------------

                               Name:  Richard Bertrand
                               Title: Senior Vice President


                               PARTNERS HEALTH GROUP -- FLORIDA, LLC
                               PARTNERS HEALTH GROUP -- LOUISIANA, LLC
                               PARTNERS HEALTH GROUP -- TEXAS, LLC

                               BY:  PARTNERS HEALTH GROUP, LLC

                               BY:  EXTENDICARE HEALTH NETWORK, INC., AS
                                    SOLE MEMBER


                               By: /s/ Richard Bertrand
                                   ---------------------------------------------

                               Name:  Richard Bertrand
                               Title: Senior Vice President












Accepted on behalf of the Initial Purchasers:

LEHMAN BROTHERS, INC.



By: /s/ Mike Konigsberg
   ------------------------------------
   Name:  Mike Konigsberg
   Title: Authorized Representative

EX-4.5

                                                                     EXHIBIT 4.5

                                                                  EXECUTION COPY


- --------------------------------------------------------------------------------


                                  $105,000,000

                      AMENDED AND RESTATED CREDIT AGREEMENT

                                      AMONG

                           EXTENDICARE HOLDINGS, INC.,

                        EXTENDICARE HEALTH SERVICES, INC.
                                  AS BORROWER,

                               THE SEVERAL LENDERS
                        FROM TIME TO TIME PARTIES HERETO,

                              LEHMAN BROTHERS INC.,
                                   AS ARRANGER

                        U.S. BANK, NATIONAL ASSOCIATION,
                              AS SYNDICATION AGENT,

                      GENERAL ELECTRIC CAPITAL CORPORATION,
                         RESIDENTIAL FUNDING CORPORATION
                           DBA GMAC-RFC HEALTH CAPITAL
                                       AND
                       LASALLE BANK NATIONAL ASSOCIATION,
                           AS CO-DOCUMENTATION AGENTS

                                       AND

                          LEHMAN COMMERCIAL PAPER INC.,
                             AS ADMINISTRATIVE AGENT


                            DATED AS OF JUNE 28, 2002

- --------------------------------------------------------------------------------





                                TABLE OF CONTENTS



                                                                                                               Page
                                                                                                         
SECTION 1. DEFINITIONS............................................................................................2

         1.1      Defined Terms...................................................................................2
         1.2      Other Definitional Provisions..................................................................23

SECTION 2. AMOUNT AND TERMS OF REVOLVING CREDIT COMMITMENTS......................................................23

         2.1      Revolving Credit Commitments...................................................................23
         2.2      Procedure for Revolving Credit Borrowing.......................................................24
         2.3      Repayment of Loans; Evidence of Debt...........................................................24
         2.4      Commitment Fees, etc...........................................................................25
         2.5      Termination or Reduction of Revolving Credit Commitments.......................................25
         2.6      Optional Prepayments...........................................................................25
         2.7      Mandatory Prepayments and Commitment Reductions................................................26
         2.8      Conversion and Continuation Options............................................................26
         2.9      Minimum Amounts and Maximum Number of Eurodollar Tranches......................................27
         2.10     Interest Rates and Payment Dates...............................................................27
         2.11     Computation of Interest and Fees...............................................................28
         2.12     Inability to Determine Interest Rate...........................................................28
         2.13     Pro Rata Treatment and Payments................................................................28
         2.14     Requirements of Law............................................................................30
         2.15     Taxes..........................................................................................31
         2.16     Indemnity......................................................................................32
         2.17     Illegality.....................................................................................33
         2.18     Change of Lending Office.......................................................................33
         2.19     Replacement of Lenders under Certain Circumstances.............................................33

SECTION 3. LETTERS OF CREDIT.....................................................................................34

         3.1      L/C Commitment.................................................................................34
         3.2      Procedure for Issuance of Letter of Credit.....................................................34
         3.3      Fees and Other Charges.........................................................................35
         3.4      L/C Participations.............................................................................35
         3.5      Reimbursement Obligation of the Borrower.......................................................36
         3.6      Obligations Absolute...........................................................................36
         3.7      Letter of Credit Payments......................................................................37
         3.8      Applications...................................................................................37

SECTION 4. REPRESENTATIONS AND WARRANTIES........................................................................37

         4.1      Financial Condition............................................................................37
         4.2      No Change......................................................................................38
         4.3      Corporate Existence; Compliance with Law.......................................................38
         4.4      Corporate Power; Authorization; Enforceable Obligations........................................38


                                      -i-



                                                                                                               Page
                                                                                                         
         4.5      No Legal Bar...................................................................................39
         4.6      No Material Litigation.........................................................................39
         4.7      No Default.....................................................................................39
         4.8      Ownership of Property; Liens...................................................................39
         4.9      Intellectual Property..........................................................................39
         4.10     Taxes..........................................................................................39
         4.11     Federal Regulations............................................................................40
         4.12     Labor Matters..................................................................................40
         4.13     ERISA..........................................................................................40
         4.14     Investment Company Act; Other Regulations......................................................40
         4.15     Material Subsidiaries..........................................................................40
         4.16     Use of Proceeds................................................................................41
         4.17     Environmental Matters..........................................................................41
         4.18     Compliance With Health Care Laws...............................................................42
         4.19     HIPAA Compliance...............................................................................42
         4.20     Accuracy of Information, etc...................................................................43
         4.21     Security Documents.............................................................................43
         4.22     Solvency.......................................................................................44
         4.23     Senior Indebtedness............................................................................44
         4.24     Regulation H...................................................................................44
         4.25     Deposit Accounts and Securities Accounts.......................................................44
         4.26     Reimbursement From Third Party Payors..........................................................44
         4.27     Fraud and Abuse................................................................................45
         4.28     Inactive Subsidiaries..........................................................................45

SECTION 5. CONDITIONS PRECEDENT..................................................................................45

         5.1      Conditions to Closing Date and Initial Extension of Credit.....................................45
         5.2      Conditions to Each Extension of Credit.........................................................48

SECTION 6. AFFIRMATIVE COVENANTS.................................................................................48

         6.1      Financial Statements...........................................................................49
         6.2      Certificates; Other Information................................................................49
         6.3      Payment of Obligations and Compliance with Agreements..........................................50
         6.4      Conduct of Business and Maintenance of Existence, etc..........................................51
         6.5      Maintenance of Property; Insurance.............................................................51
         6.6      Inspection of Property; Books and Records; Discussions.........................................51
         6.7      Notices........................................................................................51
         6.8      Environmental Laws.............................................................................52
         6.9      Additional Collateral, etc.....................................................................52
         6.10     Further Assurances.............................................................................54
         6.11     Use of Proceeds................................................................................54

SECTION 7. NEGATIVE COVENANTS....................................................................................54

         7.1      Financial Condition Covenants..................................................................55



                                      -ii-



                                                                                                               Page
                                                                                                         
         7.2      Limitation on Indebtedness.....................................................................56
         7.3      Limitation on Liens............................................................................56
         7.4      Limitation on Fundamental Changes..............................................................58
         7.5      Limitation on Disposition of Property..........................................................58
         7.6      Limitation on Restricted Payments..............................................................59
         7.7      Limitation on Capital Expenditures.............................................................60
         7.8      Limitation on Investments......................................................................60
         7.9      Limitation on Optional Payments and Modifications of Debt Instruments, etc.....................61
         7.10     Limitation on Transactions with Affiliates.....................................................61
         7.11     [Reserved].....................................................................................61
         7.12     Limitation on Changes in Fiscal Periods........................................................61
         7.13     Limitation on Negative Pledge Clauses..........................................................61
         7.14     Limitation on Restrictions on Subsidiary Distributions.........................................62
         7.15     Limitation on Lines of Business................................................................62
         7.16     Limitation on Activities of Holdings...........................................................62
         7.17     Limitation on Hedge Agreements.................................................................62
         7.18     Limitation on Activities of Inactive Subsidiaries..............................................62

SECTION 8. EVENTS OF DEFAULT.....................................................................................63


SECTION 9. THE AGENTS............................................................................................66

         9.1      Appointment....................................................................................66
         9.2      Delegation of Duties...........................................................................66
         9.3      Exculpatory Provisions.........................................................................66
         9.4      Reliance by Agents.............................................................................67
         9.5      Notice of Default..............................................................................67
         9.6      Non-Reliance on Agents and Other Lenders.......................................................68
         9.7      Indemnification................................................................................68
         9.8      Agent in Its Individual Capacity...............................................................68
         9.9      Successor Administrative Agent.................................................................69
         9.10     Authorization to Release Liens and Guarantees..................................................69
         9.11     The Arranger; the Syndication Agent; the Co-Documentation Agents...............................69
         9.12     The Administrative Agent and the Secured Parties...............................................69

SECTION 10. MISCELLANEOUS........................................................................................70

         10.1     Amendments and Waivers.........................................................................70
         10.2     Notices........................................................................................71
         10.3     No Waiver; Cumulative Remedies.................................................................72
         10.4     Survival of Representations and Warranties.....................................................73
         10.5     Payment of Expenses............................................................................73
         10.6     Successors and Assigns; Participations and Assignments.........................................74
         10.7     Adjustments; Set-off...........................................................................77
         10.8     Counterparts...................................................................................77
         10.9     Severability...................................................................................77
         10.10    Integration....................................................................................78


                                     -iii-



                                                                                                               Page
                                                                                                         
         10.11    GOVERNING LAW..................................................................................78
         10.12    Submission To Jurisdiction; Waivers............................................................78
         10.13    Acknowledgments................................................................................78
         10.14    Confidentiality................................................................................79
         10.15    Release of Collateral and Guarantee Obligations................................................79
         10.16    Accounting Changes.............................................................................80
         10.17    Delivery of Lender Addenda.....................................................................80
         10.18    WAIVERS OF JURY TRIAL..........................................................................80





ANNEXES:

A        Pricing Grid
B        Existing Letters of Credit

SCHEDULES:

1.1(a)        Mortgaged Property
1.1(b)        Existing Mortgages
1.1(c)        Inactive Subsidiaries
4.4           Consents, Authorizations, Filings and Notices
4.15          Material Subsidiaries
4.21(a)-1     UCC Filing Jurisdictions
4.21(a)-2     UCC Financing Statements to Remain on File
4.21(a)-3     UCC Financing Statements to be Terminated
4.21(b)       Mortgage Filing Jurisdictions
4.25          Deposit Accounts and Securities Accounts
7.2(d)        Existing Indebtedness
7.3(f)        Existing Liens

EXHIBITS:

A        Form of Guarantee and Collateral Agreement
B        Form of Compliance Certificate
C        Form of Closing Certificate
D        Form of Amended Mortgage
E        Form of Assignment and Acceptance
F        Form of Legal Opinion of Foley & Lardner
G        Form of Revolving Credit Note
H        Form of Exemption Certificate
I        Form of Lender Addendum
J        Form of Borrowing Notice

                                      -iv-



                  AMENDED AND RESTATED CREDIT AGREEMENT, dated as of June 28,
2002, among EXTENDICARE HOLDINGS, INC., a Wisconsin corporation ("Holdings"),
EXTENDICARE HEALTH SERVICES, INC., a Delaware corporation (the "Borrower"), the
several banks and other financial institutions or entities from time to time
parties to this Agreement (the "Lenders"), LEHMAN BROTHERS INC., as advisor,
lead arranger and book manager (in such capacity, the "Arranger"), U.S. BANK,
NATIONAL ASSOCIATION, as syndication agent (in such capacity, the "Syndication
Agent"), GENERAL ELECTRIC CAPITAL CORPORATION, RESIDENTIAL FUNDING CORPORATION
dba GMAC-RFC HEALTH CAPITAL and LASALLE BANK NATIONAL ASSOCIATION, as
Co-Documentation Agents (in such capacity, the "Co-Documentation Agents"), and
LEHMAN COMMERCIAL PAPER INC. ("LCPI"), as administrative agent (in such
capacity, the "Administrative Agent").

                                  WITNESSETH:
                                  -----------

                  WHEREAS, the Borrower and Holdings are parties to the Credit
Agreement, dated as of November 26, 1997 (as amended, supplemented or otherwise
modified, the "Existing Credit Agreement"), with the lenders parties thereto
(the "Existing Lenders") and Bank of America, N.A., as Agent (the "Existing
Agent");

                  WHEREAS, pursuant to the Existing Credit Agreement, certain of
the Existing Lenders made term loans to the Borrower (the "Existing Term
Loans"), and certain of the Existing Lenders made available a revolving credit
facility (the "Existing Revolving Credit Facility") providing for extensions of
credit by such Existing Lenders to the Borrower by making revolving credit loans
to the Borrower (the "Existing Revolving Credit Loans") and issuing letters of
credit for the account of the Borrower (the "Existing Letters of Credit");

                  WHEREAS, on the Closing Date (such term and other capitalized
terms used in these recitals and not defined in these recitals being used with
the definitions given to such terms in Section 1.1), the Borrower is issuing and
selling $150,000,000 aggregate principal amount of its Senior Notes;

                  WHEREAS, the proceeds of the Senior Notes will be used on the
Closing Date to repay in full all Existing Term Loans and all Existing Revolving
Credit Loans, if any, outstanding under the Existing Credit Agreement;

                  WHEREAS, on the Closing Date, immediately after the repayment
of all Existing Term Loans and all Existing Revolving Credit Loans, (i) the
Borrower will permanently reduce the commitments under the Existing Revolving
Credit Facility (the "Existing Revolving Credit Commitments") to $105,000,000
and (ii) the Existing Lenders having Existing Revolving Credit Commitments, as
so reduced, will assign to LCPI, and LCPI will assume, such Existing Revolving
Credit Commitments, together with any Participation Interests (as defined in the
Existing Credit Agreement) then outstanding under the Existing Revolving Credit
Agreement (the "Existing Participation Interests");

                  WHEREAS, on the Closing Date, immediately following the
consummation of the assignments to, and assumptions by, LCPI described in the
preceding recital, the Existing




                                                                               2


Agent will resign as Agent under the Existing Credit Agreement and LCPI will be
appointed, and will accept its appointment, as Agent under the Existing Credit
Agreement, and, concurrently therewith, the Existing Agent will assign and
deliver to LCPI, as successor Agent, all Collateral (as defined in the Existing
Credit Agreement, the "Existing Collateral") and all Collateral Documents (such
Collateral Documents, as defined in the Existing Credit Agreement, together with
any other security documents held by the Agent under the Existing Credit
Agreement, the "Existing Collateral Documents"),

                  WHEREAS, on the Closing Date, immediately following the
consummation of the transactions described in the preceding recital, (i) LCPI
will assign to each of the Lenders parties hereto, and each of the Lenders
parties hereto will assume, a portion of the Existing Revolving Credit
Commitments (including any Existing Participation Interests), equal to the
amount of the Revolving Credit Commitment of such Lender hereunder (as set forth
in the Lender Addendum by which such Lender becomes a party hereto) and (ii) the
Existing Credit Agreement will be amended and restated in its entirety by this
Agreement; and

                  WHEREAS, from and after the Closing Date, after giving effect
to the transactions described in the foregoing recitals and to the amendment and
restatement of the Existing Credit Agreement effected hereby, (i) the Existing
Revolving Credit Commitments, as reduced as provided in the third preceding
recital and as amended as provided herein, shall become the Revolving Credit
Commitments held by the Lenders hereunder, (ii) all Existing Collateral shall
become Collateral hereunder, except as otherwise provided herein, and (iii) all
Existing Collateral Documents, as amended, amended and restated or otherwise
modified as provided herein, shall become Security Documents hereunder;

                  NOW, THEREFORE, in consideration of the premises and the
agreements hereinafter set forth, the parties hereto hereby agree that, on the
Closing Date, the Existing Credit Agreement will be amended and restated in its
entirety as follows:

                             SECTION 1. DEFINITIONS

                  1.1 Defined Terms. As used in this Agreement, the terms listed
in this Section 1.1 shall have the respective meanings set forth in this Section
1.1.

                  "Adjustment Date": as defined in the Pricing Grid.

                  "Administrative Agent": as defined in the preamble hereto.

                  "Affiliate": as to any Person, any other Person that, directly
or indirectly, is in control of, is controlled by, or is under common control
with, such Person. For purposes of this definition, "control" of a Person means
the power, directly or indirectly, either to (a) vote 10% or more of the
securities having ordinary voting power for the election of directors (or
persons performing similar functions) of such Person or (b) direct or cause the
direction of the management and policies of such Person, whether by contract or
otherwise.

                  "Agents": the collective reference to the Syndication Agent,
the Co-Documentation Agents and the Administrative Agent.




                                                                               3


                  "Aggregate Exposure": with respect to any Lender at any time,
an amount equal to (a) until the Closing Date, the amount of such Lender's
Revolving Credit Commitment at such time and (b) thereafter, the amount of such
Lender's Revolving Credit Commitment then in effect or, if the Revolving Credit
Commitments have been terminated, the amount of such Lender's Revolving
Extensions of Credit then outstanding.

                  "Aggregate Exposure Percentage": with respect to any Lender at
any time, the ratio (expressed as a percentage) of such Lender's Aggregate
Exposure at such time to the sum of the Aggregate Exposures of all Lenders at
such time.

                  "Agreement": this Amended and Restated Credit Agreement, as
amended, supplemented, restated or otherwise modified from time to time.

                  "Applicable Margin": (a) 2.50% per annum, in the case of Base
Rate Loans and (b) 3.50%, in the case of Eurodollar Loans; provided, that on and
after the first Adjustment Date occurring after the completion of four full
fiscal quarters of the Borrower after the Closing Date, the Applicable Margins
will be determined pursuant to the Pricing Grid.

                  "Application": an application, in such form as the relevant
Issuing Lender may specify from time to time, requesting such Issuing Lender to
issue a Letter of Credit.

                  "Arranger": as defined in the preamble hereto.

                  "Asset Sale": any Disposition of Property or series of related
Dispositions of Property (excluding any such Disposition permitted by clause
(a), (b), (c), (d), (e) or (g) of Section 7.5) which yields gross proceeds to
the Borrower or any of its Subsidiaries (valued at the initial principal amount
thereof in the case of non-cash proceeds consisting of notes or other debt
securities and valued at fair market value in the case of other non-cash
proceeds) in excess of $1,000,000.

                  "Assignee": as defined in Section 10.6(c).

                  "Assignor": as defined in Section 10.6(c).

                  "Available Revolving Credit Commitment": with respect to any
Lender at any time, an amount equal to the excess, if any, of (a) such Lender's
Revolving Credit Commitment then in effect over (b) such Lender's Revolving
Extensions of Credit then outstanding.

                  "Base Rate": for any day, a rate per annum (rounded upwards,
if necessary, to the next 1/16 of 1%) equal to the greatest of (a) the Prime
Rate in effect on such day and (b) the Federal Funds Effective Rate in effect on
such day plus 1/2 of 1%. For purposes hereof: "Prime Rate" shall mean the prime
lending rate as set forth on the British Banking Association Telerate Page 5 (or
such other comparable page as may, in the opinion of the Administrative Agent,
replace such page for the purpose of displaying such rate), as in effect form
time to time. Any change in the Base Rate due to a change in the Prime Rate or
the Federal Funds Effective Rate shall be effective as of the opening of
business on the effective day of such change in the Prime Rate or the Federal
Funds Effective Rate, respectively.




                                                                               4

                  "Base Rate Loans": Loans for which the applicable rate of
interest is based upon the Base Rate.

                  "Benefited Lender": as defined in Section 10.7.

                  "Board": the Board of Governors of the Federal Reserve System
of the United States (or any successor).

                  "Borrower": as defined in the preamble hereto.

                  "Borrowing Date": any Business Day specified by the Borrower
as a date on which the Borrower requests the Lenders to make Loans hereunder.

                  "Borrowing Notice": with respect to any request for a
borrowing of Loans hereunder, a notice from the Borrower, substantially in the
form of, and containing the information prescribed by, Exhibit K, delivered to
the Administrative Agent.

                  "Business Day": (a) for all purposes other than as covered by
clause (b) below, a day other than a Saturday, Sunday or other day on which
commercial banks in New York City are authorized or required by law to close and
(b) with respect to all notices and determinations in connection with, and
payments of principal and interest on, Eurodollar Loans, any day which is a
Business Day described in clause (a) and which is also a day for trading by and
between banks in Dollar deposits in the interbank eurodollar market.

                  "Capital Expenditures": for any period, with respect to any
Person, the aggregate of all expenditures by such Person for the acquisition or
leasing (pursuant to a capital lease) of fixed or capital assets or additions to
equipment (including replacements, capitalized repairs and improvements during
such period) which are required to be capitalized under GAAP on a balance sheet
of such Person.

                  "Capital Lease Obligations": with respect to any Person, the
obligations of such Person to pay rent or other amounts under any lease of (or
other arrangement conveying the right to use) real or personal property, or a
combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such Person under GAAP;
and, for the purposes of this Agreement, the amount of such obligations at any
time shall be the capitalized amount thereof at such time determined in
accordance with GAAP.

                  "Capital Stock": any and all shares, interests, participations
or other equivalents (however designated) of capital stock of a corporation, any
and all equivalent ownership interests in a Person (other than a corporation)
and any and all warrants, rights or options to purchase any of the foregoing.

                  "Cash Equivalents": (a) marketable direct obligations issued
by, or unconditionally guaranteed by, the United States Government or issued by
any agency thereof and backed by the full faith and credit of the United States,
in each case maturing within one year from the date of acquisition; (b)
certificates of deposit, time deposits, eurodollar time deposits or overnight
bank deposits having maturities of six months or less from the date of
acquisition issued by any Lender or by any commercial bank organized under the
laws of the



                                                                               5


United States of America or any state thereof having combined capital and
surplus of not less than $500,000,000; (c) commercial paper of an issuer rated
at least A-2 by Standard & Poor's Ratings Services ("S&P") or P-2 by Moody's
Investors Service, Inc. ("Moody's"), or carrying an equivalent rating by a
nationally recognized rating agency, if both of the two named rating agencies
cease publishing ratings of commercial paper issuers generally, and maturing
within six months from the date of acquisition; (d) repurchase obligations of
any Lender or of any commercial bank satisfying the requirements of clause (b)
of this definition, having a term of not more than 30 days with respect to
securities issued or fully guaranteed or insured by the United States
government; (e) securities with maturities of one year or less from the date of
acquisition issued or fully guaranteed by any state, commonwealth or territory
of the United States, by any political subdivision or taxing authority of any
such state, commonwealth or territory or by any foreign government, the
securities of which state, commonwealth, territory, political subdivision,
taxing authority or foreign government (as the case may be) are rated at least A
by S&P or A by Moody's; (f) securities with maturities of six months or less
from the date of acquisition backed by standby letters of credit issued by any
Lender or any commercial bank satisfying the requirements of clause (b) of this
definition; and (g) shares of money market mutual or similar funds which invest
exclusively in assets satisfying the requirements of clauses (a) through (f) of
this definition.

                  "Change of Control": the occurrence of any of the following
events: (a) any "person" or "group" (as such terms are used in Sections 13(d)
and 14(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act")), shall become, or obtain rights (whether by means of warrants, options or
otherwise) to become, the "beneficial owner" (as defined in Rules 13(d)-3 and
13(d)-5 under the Exchange Act), directly or indirectly, of more than 35% of the
outstanding common stock of the Parent; (b) the board of directors of the Parent
shall cease to consist of a majority of Continuing Directors; (c) the Parent
shall cease to own and control, of record and beneficially, directly or
indirectly, a majority of each class of outstanding Capital Stock of Holdings
free and clear of all Liens (except Liens created by the Guarantee and
Collateral Agreement); (d) Holdings shall cease to own and control, of record
and beneficially, directly, 100% of each class of outstanding Capital Stock of
the Borrower free and clear of all Liens (except Liens created by the Guarantee
and Collateral Agreement); or (e) a Specified Change of Control.

                  "Closing Date": the date on which the conditions precedent set
forth in Section 5.1 shall have been satisfied, which date shall be not later
than June 28, 2002.

                  "Code": the Internal Revenue Code of 1986, as amended from
time to time.

                  "Collateral": all Property of the Loan Parties, now owned or
hereafter acquired, upon which a Lien is created or purported to be created by
any Security Document.

                  "Commitment Fee Rate": (a) for each day on which the Total
Revolving Extensions of Credit of all Lenders is less than 33-1/3% of the Total
Revolving Credit Commitments, 0.75%; (b) for each day on which the Total
Revolving Extensions of Credit of all Lenders is at least 33-1/3%, but less than
66-2/3%, of the Total Revolving Credit Commitments, 0.625%; and (c) for each day
on which the Total Revolving Extensions of Credit of all Lenders is equal to or
greater than 66-2/3% of the Total Revolving Credit Commitments, 0.50%.



                                                                               6


                  "Commonly Controlled Entity": an entity, whether or not
incorporated, that is under common control with the Borrower within the meaning
of Section 4001 of ERISA or is part of a group that includes the Borrower and
that is treated as a single employer under Section 414 of the Code.

                  "Compliance Certificate": a certificate duly executed by a
Responsible Officer, substantially in the form of Exhibit B.

                  "Confidential Information Memorandum": the Confidential
Information Memorandum dated May 2002 and furnished to the initial Lenders in
connection with the syndication of the Revolving Credit Commitments.

                  "Consolidated EBITDA": of any Person for any period,
Consolidated Net Income of such Person and its Subsidiaries for such period
plus, without duplication and to the extent reflected as a charge in the
statement of such Consolidated Net Income for such period, the sum of (a) income
tax expense, (b) Consolidated Interest Expense of such Person and its
Subsidiaries, amortization or write-off of debt discount and debt issuance costs
and commissions, discounts and other fees and charges associated with
Indebtedness, (c) depreciation and amortization expense, (d) amortization of
intangibles (including, but not limited to, goodwill) and organization costs,
(e) any extraordinary, unusual (including increases to actuarial reserves for
the Transferred Properties) or non-recurring expenses or losses (including,
whether or not otherwise includable as a separate item in the statement of such
Consolidated Net Income for such period, losses on sales of assets outside of
the ordinary course of business), (f) any other non-cash charges including
write-off of goodwill or write-down of fixed asset values and (g) any write-down
of Capital Stock of Omnicare held by the Borrower on March 31, 2002 and minus,
without duplication and to the extent included in the statement of such
Consolidated Net Income for such period, the sum of (a) interest income (except
to the extent deducted in determining Consolidated Interest Expense), (b) any
extraordinary, unusual or non-recurring income or gains (including, whether or
not otherwise includable as a separate item in the statement of such
Consolidated Net Income for such period, gains on the sales of assets outside of
the ordinary course of business), (c) income tax credits and (d) any other
non-cash income, all as determined on a consolidated basis; provided, that for
purposes of calculating Consolidated EBITDA of the Borrower and its Subsidiaries
for any period, (i) the Consolidated EBITDA of any Person, or any assets
constituting a business unit, acquired by the Borrower or its Subsidiaries
during such period shall be included on a pro forma basis for such period
(assuming the consummation of such acquisition and the incurrence or assumption
of any Indebtedness in connection therewith occurred on the first day of such
period) if the consolidated balance sheet of such acquired Person and its
consolidated Subsidiaries, or such business unit, as at the end of the period
preceding the acquisition of such Person, or such business unit, and the related
consolidated statements of income and stockholders' equity and of cash flows for
the period in respect of which Consolidated EBITDA is to be calculated (x) have
been previously provided to the Administrative Agent and the Lenders and (y)
either (1) have been reported on without a qualification arising out of the
scope of the audit by independent certified public accountants of nationally
recognized standing or (2) have been found acceptable by the Administrative
Agent, (ii) the Consolidated EBITDA of any Person, or attributable to the assets
constituting a business unit, Disposed of by the Borrower or its Subsidiaries
during such period (including the Transferred Properties, in the case of
calculation of Consolidated EBITDA of the Borrower and



                                                                               7

its Subsidiaries for any period which includes any date on or prior to the date
of Disposition of the Transferred Properties) shall be excluded for such period
(assuming the consummation of such Disposition and the repayment of any
Indebtedness in connection therewith occurred on the first day of such period)
and (iii) the Consolidated EBITDA attributable to any Non-Recourse Subsidiary or
any assets that secure Permitted Non-Recourse Debt shall be excluded from
Consolidated EBITDA of the Borrower and its Subsidiaries. In addition, changes
in accounting principles affecting financial covenants within such testing
period shall be reversed so as to nullify such affect.

                  "Consolidated EBITDAR": of any Person for any period, the
Consolidated EBITDA of such Person for such period, plus Consolidated Lease
Expense of such Person for such period; provided, that in determining
Consolidated EBITDAR of the Borrower and its Subsidiaries for any period which
includes any date on or prior to the date of Disposition of the Transferred
Properties, all amounts specified in the foregoing definition that are
attributable to the Transferred Properties shall not be included.

                  "Consolidated Fixed Charge Coverage Ratio": for any period,
the ratio of (a) Consolidated EBITDAR of the Borrower and its Subsidiaries for
such period minus Consolidated Maintenance Capital Expenditures of the Borrower
and its Subsidiaries for such period to (b) Consolidated Fixed Charges for such
period.

                  "Consolidated Fixed Charges": for any period, the sum (without
duplication) of (a) Consolidated Interest Expense of the Borrower and its
Subsidiaries for such period, (b) Consolidated Lease Expense of the Borrower and
its Subsidiaries for such period and (c) scheduled payments made during such
period on account of principal of Indebtedness of the Borrower or any of its
Subsidiaries; provided, that in determining Consolidated Fixed Charges for any
period which includes any date on or prior to the date of Disposition of the
Transferred Properties, all amounts specified in the foregoing definition that
are attributable to the Transferred Properties shall not be included.

                  "Consolidated Growth Capital Expenditures": for any period,
all Capital Expenditures of the Borrower and its Subsidiaries for such period
representing the purchase price for, or other costs associated with the
acquisition, construction or expansion of, a facility owned or operated by the
Borrower or any Subsidiary; provided, that in determining Consolidated Growth
Capital Expenditures for any period which includes any date on or prior to the
date of Disposition of the Transferred Properties, all Capital Expenditures that
are attributable to the Transferred Properties shall not be included.

                  "Consolidated Interest Expense": of any Person for any period,
total cash interest expense (excluding that attributable to Capital Lease
Obligations and any amounts for amortization of costs relative to previous
financings, including, with respect to the Borrower, breakage costs associated
with the repayment of loans and termination of swap agreements in connection
with the Existing Credit Agreement) of such Person and its Subsidiaries for such
period with respect to all outstanding Indebtedness of such Person and its
Subsidiaries (including, without limitation, all commissions, discounts and
other fees and charges owed by such Person with respect to letters of credit and
bankers' acceptance financing and net costs of



                                                                               8

such Person under Hedge Agreements in respect of interest rates to the extent
such net costs are allocable to such period in accordance with GAAP).

                  "Consolidated Lease Expense": of any Person for any period,
the aggregate amount of fixed and contingent rentals payable by such Person and
its Subsidiaries for such period with respect to leases of real and personal
property, determined on a consolidated basis in accordance with GAAP, provided,
that payments in respect of Capital Lease Obligations shall not constitute
Consolidated Lease Expense.

                  "Consolidated Maintenance Capital Expenditures": for any
period, all Capital Expenditures of the Borrower and its Subsidiaries for such
period, other than Consolidated Growth Capital Expenditures; provided, that in
determining Consolidated Maintenance Capital Expenditures for any period which
includes any date on or prior to the date of Disposition of the Transferred
Properties, all Capital Expenditures that are attributable to the Transferred
Properties shall not be included.

                  "Consolidated Net Income": of any Person for any period, the
consolidated net income (or loss) of such Person and its Subsidiaries for such
period, determined on a consolidated basis in accordance with GAAP; provided,
that in calculating Consolidated Net Income of the Borrower and its consolidated
Subsidiaries for any period, there shall be excluded (a) the income (or deficit)
of any Person accrued prior to the date it becomes a Subsidiary of the Borrower
or is merged into or consolidated with the Borrower or any of its Subsidiaries,
(b) the income (or deficit) of any Person (other than a Subsidiary of the
Borrower) in which the Borrower or any of its Subsidiaries has an ownership
interest, except to the extent that any such income is actually received by the
Borrower or such Subsidiary in the form of dividends or similar distributions,
(c) the undistributed earnings of any Subsidiary of the Borrower to the extent
that the declaration or payment of dividends or similar distributions by such
Subsidiary is not at the time permitted by the terms of any Contractual
Obligation (other than under any Loan Document) or Requirement of Law applicable
to such Subsidiary, (d) in determining Consolidated Net Income of the Borrower
and its Subsidiaries for any period which includes the date of Disposition of
the Transferred Properties, the amount of consolidated net income attributable
to the Transferred Properties for such period shall not be included and (e) in
determining Consolidated Net Income of the Borrower and its Subsidiaries for any
period, the consolidated net income for such period attributable to any
Non-Recourse Subsidiary or any assets that secure Permitted Non-Recourse Debt
shall be excluded.

                  "Consolidated Senior Debt": all Consolidated Total Debt other
than (a) the Senior Subordinated Notes and (b) Permitted Non-Recourse Debt.

                  "Consolidated Senior Leverage Ratio": as at the last day of
any period of four consecutive fiscal quarters of the Borrower, the ratio of (a)
Consolidated Senior Debt on such day to (b) Consolidated EBITDA of the Borrower
and its Subsidiaries for such period.

                  "Consolidated Senior Secured Leverage Ratio": as at the last
day of any period of four consecutive fiscal quarters of the Borrower, the ratio
of (a) the amount of all Consolidated Senior Debt on such day other than
unsecured Indebtedness to (b) Consolidated EBITDA of the Borrower and its
Subsidiaries for such period.




                                                                               9


                   "Consolidated Tangible Net Worth": at any date, the
difference of (a) all amounts that would, in conformity with GAAP, be included
on a consolidated balance sheet of the Borrower and its Subsidiaries under
stockholders' equity at such date (excluding either write-ups or write-downs of
the Transferred Properties or consideration received in respect thereto) minus
(b) the amounts included on such consolidated balance sheet for goodwill, trade
names, trademarks, patents, unamortized debt discount and expense and other like
intangible assets.

                  "Consolidated Total Debt": at any date, the aggregate
principal amount of all Indebtedness of the Borrower and its Subsidiaries at
such date, determined on a consolidated basis in accordance with GAAP.

                  "Continuing Directors": the directors of the Parent on the
Closing Date, and each other director of the Parent, if, in each case, such
other director's nomination for election to the board of directors of the Parent
is recommended by the nominating committee of the board of directors of the
Parent.

                  "Contractual Obligation": as to any Person, any provision of
any security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
Property is bound.

                  "Control Agreement": (a) with respect to each Deposit Account,
a control agreement, in form and substance reasonably satisfactory to the
Administrative Agent, providing (i) for the Administrative Agent to have
"control" (within the meaning of Section 9-104 of the applicable Uniform
Commercial Code) of such Deposit Account and (ii) that the Administrative Agent
will not exercise any remedies thereunder except during the continuance of an
Event of Default and (b) with respect to each Securities Account, a control
agreement, in form and substance reasonably satisfactory to the Administrative
Agent, providing (i) for the Administrative Agent to have "control" (within the
meaning of Section 9-106 of the applicable Uniform Commercial Code) of such
Securities Account and (ii) that the Administrative Agent will not exercise any
remedies thereunder except during the continuance of an Event of Default.

                  "Control Investment Affiliate": as to any Person, any other
Person that (a) directly or indirectly, is in control of, is controlled by, or
is under common control with, such Person and (b) is organized by such Person
primarily for the purpose of making equity or debt investments in one or more
companies. For purposes of this definition, "control" of a Person means the
power, directly or indirectly, to direct or cause the direction of the
management and policies of such Person, whether by contract or otherwise.

                  "Default": any of the events specified in Section 8, whether
or not any requirement for the giving of notice, the lapse of time, or both, has
been satisfied.

                  "Deposit Account": each "deposit account" (as defined in
Section 9-102 of the New York Uniform Commercial Code) in respect of which the
Borrower or any of its Subsidiaries (other than any Excluded Foreign Subsidiary)
is the depositor.

                  "Derivatives Counterparty": as defined in Section 7.6.



                                                                              10

                  "Disposition": with respect to any Property, any sale, lease,
sale and leaseback, assignment, conveyance, transfer or other disposition
thereof; and the terms "Dispose" and "Disposed of" shall have correlative
meanings.

                  "Dollars" and "$": lawful currency of the United States of
America.

                  "Domestic Subsidiary": any Subsidiary of the Borrower
organized under the laws of any jurisdiction within the United States of
America.

                  "Environmental Laws": any and all laws, rules, orders,
regulations, statutes, ordinances, guidelines, codes, decrees, or other legally
enforceable requirements (including, without limitation, common law) of any
international authority, foreign government, the United States, or any state,
local, municipal or other governmental authority, regulating, relating to or
imposing liability or standards of conduct concerning protection of the
environment or of human health, or employee health and safety, as has been, is
now, or may at any time hereafter be, in effect.

                  "Environmental Permits": any and all permits, licenses,
approvals, registrations, notifications, exemptions and other authorizations
required under any Environmental Law.

                  "ERISA": the Employee Retirement Income Security Act of 1974,
as amended from time to time.

                  "Eurocurrency Reserve Requirements": for any day, the
aggregate (without duplication) of the maximum rates (expressed as a decimal
fraction) of reserve requirements in effect on such day (including, without
limitation, basic, supplemental, marginal and emergency reserves) under any
regulations of the Board or other Governmental Authority having jurisdiction
with respect thereto dealing with reserve requirements prescribed for
eurocurrency funding (currently referred to as "Eurocurrency Liabilities" in
Regulation D of the Board) maintained by a member bank of the Federal Reserve
System.

                  "Eurodollar Base Rate": with respect to each day during each
Interest Period, the rate per annum determined on the basis of the rate for
deposits in Dollars for a period equal to such Interest Period commencing on the
first day of such Interest Period appearing on Page 3750 of the Telerate screen
as of 11:00 A.M., London time, two Business Days prior to the beginning of such
Interest Period. In the event that such rate does not appear on Page 3750 of the
Telerate screen (or otherwise on such screen), the "Eurodollar Base Rate" for
purposes of this definition shall be determined by reference to such other
comparable publicly available service for displaying eurodollar rates as may be
selected by the Administrative Agent.

                  "Eurodollar Loans": Loans for which the applicable rate of
interest is based upon the Eurodollar Rate.

                  "Eurodollar Rate": with respect to each day during each
Interest Period, a rate per annum determined for such day in accordance with the
following formula (rounded upward to the nearest 1/100th of 1%):



                                                                              11
                              Eurodollar Base Rate
                          ----------------------------
                    1.00 - Eurocurrency Reserve Requirements

                  "Eurodollar Tranche": the collective reference to Eurodollar
Loans under any Facility the then current Interest Periods with respect to all
of which begin on the same date and end on the same later date (whether or not
such Loans shall originally have been made on the same day).

                  "Event of Default": any of the events specified in Section 8,
provided that any requirement for the giving of notice, the lapse of time, or
both, has been satisfied.

                  "Excluded Foreign Subsidiaries": any Foreign Subsidiary in
respect of which either (a) the pledge of all of the Capital Stock of such
Subsidiary as Collateral or (b) the guaranteeing by such Subsidiary of the
Obligations, would, in the good faith judgment of the Borrower, result in
adverse tax consequences to the Borrower.

                  "Existing Credit Agreement": as defined in the recitals to
this Agreement.

                  "Existing Issuing Lender": Bank of America, N.A., as issuer of
the Existing Letters of Credit.

                  "Existing Letters of Credit": the letters of credit described
in Annex B.

                  "Existing Mortgagee Title Policies": the collective reference
to each of those certain existing mortgagee policies of title insurance issued
to the Existing Agent pursuant to the Existing Credit Agreement in respect of
each of the Mortgaged Properties.

                  "Existing Mortgages": the collective reference to each
existing deed of trust and mortgage listed on Schedule 1.1(b), in each case, as
amended from time to time, delivered pursuant to the Existing Credit Agreement
in respect of each of the Mortgaged Properties.

                  "Federal Funds Effective Rate": for any day, the weighted
average of the rates on overnight federal funds transactions with members of the
Federal Reserve System arranged by federal funds brokers, as published on the
next succeeding Business Day by the Federal Reserve Bank of New York, or, if
such rate is not so published for any day which is a Business Day, the average
of the quotations for the day of such transactions received by the Reference
Lender from three federal funds brokers of recognized standing selected by it.

                  "Fee Letter": the Fee Letter, dated May 16, 2002, addressed by
the Arranger to the Borrower.

                  "Foreign Subsidiary": any Subsidiary of the Borrower that is
not a Domestic Subsidiary.

                  "FQ1", "FQ2 ", "FQ3", and "FQ4": when used with a numerical
year designation, means the first, second, third or fourth fiscal quarters,
respectively, of such fiscal year of the Borrower. (e.g., FQ4 2002 means the
fourth fiscal quarter of the Borrower's 2002 fiscal year, which ends December
31, 2002).

                                                                              12

                  "Funding Office": the office specified from time to time by
the Administrative Agent as its funding office by notice to the Borrower and the
Lenders.

                  "GAAP": generally accepted accounting principles in the United
States of America as in effect from time to time.

                  "Governmental Authority": any nation or government, any state
or other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.

                  "Guarantee and Collateral Agreement": the Amended and Restated
Guarantee and Collateral Agreement to be executed and delivered by Holdings, the
Borrower and each Subsidiary Guarantor, substantially in the form of Exhibit A,
as the same may be amended, supplemented or otherwise modified from time to
time.

                  "Guarantee Obligation": as to any Person (the "guaranteeing
person"), any obligation of (a) the guaranteeing person or (b) another Person
(including, without limitation, any bank under any letter of credit), if to
induce the creation of such obligation of such other Person the guaranteeing
person has issued a reimbursement, counterindemnity or similar obligation, in
either case guaranteeing or in effect guaranteeing any Indebtedness, leases,
dividends or other obligations (the "primary obligations") of any other third
Person (the "primary obligor") in any manner, whether directly or indirectly,
including, without limitation, any obligation of the guaranteeing person,
whether or not contingent, (i) to purchase any such primary obligation or any
Property constituting direct or indirect security therefor, (ii) to advance or
supply funds (1) for the purchase or payment of any such primary obligation or
(2) to maintain working capital or equity capital of the primary obligor or
otherwise to maintain the net worth or solvency of the primary obligor, (iii) to
purchase Property, securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation or (iv) otherwise to assure or hold
harmless the owner of any such primary obligation against loss in respect
thereof; provided, however, that the term Guarantee Obligation shall not include
endorsements of instruments for deposit or collection in the ordinary course of
business. The amount of any Guarantee Obligation of any guaranteeing person
shall be deemed to be the lower of (a) an amount equal to the stated or
determinable amount of the primary obligation in respect of which such Guarantee
Obligation is made and (b) the maximum amount for which such guaranteeing person
may be liable pursuant to the terms of the instrument embodying such Guarantee
Obligation, unless such primary obligation and the maximum amount for which such
guaranteeing person may be liable are not stated or determinable, in which case
the amount of such Guarantee Obligation shall be such guaranteeing person's
maximum reasonably anticipated liability in respect thereof as determined by the
Borrower in good faith.

                  "Guarantors": the collective reference to Holdings and the
Subsidiary Guarantors.

                  "Healthcare Laws" means, collectively, any and all federal,
state or local laws, rules, regulations and administrative manuals, orders,
guidelines and requirements issued under or in connection with Medicare,
Medicaid or any government payment program or any law




                                                                              13

governing the licensure of or regulating healthcare providers, professionals,
facilities or payors or otherwise governing or regulating the provision of, or
payment for, medical services.

                  "Hedge Agreements": all interest rate or currency swaps, caps
or collar agreements, foreign exchange agreements, commodity contracts or
similar arrangements entered into by the Borrower or its Subsidiaries providing
for protection against fluctuations in interest rates, currency exchange rates,
commodity prices or the exchange of nominal interest obligations, either
generally or under specific contingencies and not for speculative purposes. For
avoidance of doubt, Hedge Agreements shall include any interest rate swap or
similar agreement that provides for the payment by the Borrower or any of its
Subsidiaries of amounts based upon a floating rate in exchange for receipt by
the Borrower or such Subsidiary of amounts based upon a fixed rate.

                  "HIPAA" means the Health Insurance Portability and
Accountability Act of 1996, as the same may be amended, modified or supplemented
from time to time, and any successor statute thereto, and any and all rules or
regulations promulgated from time to time thereunder.

                  "Inactive Subsidiaries": the Subsidiaries listed on Schedule
1.1(c).

                  "Indebtedness": of any Person at any date, without
duplication, (a) all indebtedness of such Person for borrowed money, (b) all
obligations of such Person for the deferred purchase price of Property or
services (other than trade payables incurred in the ordinary course of such
Person's business), (c) all obligations of such Person evidenced by notes,
bonds, debentures or other similar instruments, (d) all indebtedness created or
arising under any conditional sale or other title retention agreement with
respect to Property acquired by such Person (even though the rights and remedies
of the seller or lender under such agreement in the event of default are limited
to repossession or sale of such Property), (e) all Capital Lease Obligations of
such Person, (f) all obligations of such Person, contingent or otherwise, as an
account party or applicant under acceptance, letter of credit or similar
facilities, (g) all obligations of such Person, contingent or otherwise, to
purchase, redeem, retire or otherwise acquire for value any Capital Stock of
such Person, (h) all Guarantee Obligations of such Person in respect of
obligations of the kind referred to in clauses (a) through (g) above; (i) all
obligations of the kind referred to in clauses (a) through (h) above secured by
(or for which the holder of such obligation has an existing right, contingent or
otherwise, to be secured by) any Lien on Property (including, without
limitation, accounts and contract rights) owned by such Person, whether or not
such Person has assumed or become liable for the payment of such obligation and
(j) for the purposes of Section 8(e) only, all obligations of such Person in
respect of Hedge Agreements.

                  "Indemnified Liabilities": as defined in Section 10.5.

                  "Indemnitee": as defined in Section 10.5.

                  "Insolvency": with respect to any Multiemployer Plan, the
condition that such Plan is insolvent within the meaning of Section 4245 of
ERISA.



                                                                              14

                  "Insolvent":  pertaining to a condition of Insolvency.

                  "Intellectual Property": the collective reference to all
rights, priorities and privileges relating to intellectual property, whether
arising under United States, multinational or foreign laws or otherwise,
including, without limitation, copyrights, copyright licenses, patents, patent
licenses, trademarks, trademark licenses, technology, know-how and processes,
and all rights to sue at law or in equity for any infringement or other
impairment thereof, including the right to receive all proceeds and damages
therefrom.

                  "Interest Payment Date": (a) as to any Base Rate Loan, the
last day of each March, June, September and December to occur while such Loan is
outstanding and the final maturity date of such Loan, (b) as to any Eurodollar
Loan having an Interest Period of three months or shorter, the last day of such
Interest Period, (c) as to any Eurodollar Loan having an Interest Period longer
than three months, each day that is three months, or a whole multiple thereof,
after the first day of such Interest Period and the last day of such Interest
Period and (d) as to any Loan (other than any Base Rate Loan), the date of any
repayment or prepayment made in respect thereof.

                  "Interest Period": as to any Eurodollar Loan, (a) initially,
the period commencing on the borrowing or conversion date, as the case may be,
with respect to such Eurodollar Loan and ending one, two, three or six months
thereafter, as selected by the Borrower in its notice of borrowing or notice of
conversion, as the case may be, given with respect thereto; and (b) thereafter,
each period commencing on the last day of the next preceding Interest Period
applicable to such Eurodollar Loan and ending one, two, three or six months
thereafter, as selected by the Borrower by irrevocable notice to the
Administrative Agent not less than three Business Days prior to the last day of
the then current Interest Period with respect thereto; provided that, all of the
foregoing provisions relating to Interest Periods are subject to the following:

                           (i)      if any Interest Period would otherwise end
                                    on a day that is not a Business Day, such
                                    Interest Period shall be extended to the
                                    next succeeding Business Day unless the
                                    result of such extension would be to carry
                                    such Interest Period into another calendar
                                    month in which event such Interest Period
                                    shall end on the immediately preceding
                                    Business Day;

                           (ii)     any Interest Period that would otherwise
                                    extend beyond the Revolving Credit
                                    Termination Date, shall end on the Revolving
                                    Credit Termination Date; and

                           (iii)    any Interest Period that begins on the last
                                    Business Day of a calendar month (or on a
                                    day for which there is no numerically
                                    corresponding day in the calendar month at
                                    the end of such Interest Period) shall end
                                    on the last Business Day of the calendar
                                    month at the end of such Interest Period.

                  "Investments":  as defined in Section 7.8.



                                                                              15

                  "Issuing Lender": initially, LaSalle Bank National
Association, and thereafter any Lender from time to time designated by the
Borrower as an Issuing Lender with the consent of such Lender and the
Administrative Agent.

                  "L/C Commitment": $105,000,000.

                  "L/C Fee Payment Date": the last day of each March, June,
September and December and the last day of the Revolving Credit Commitment
Period.

                  "L/C Obligations": at any time, an amount equal to the sum of
(a) the aggregate then undrawn and unexpired amount of the then outstanding
Letters of Credit and (b) the aggregate amount of drawings under Letters of
Credit that have not then been reimbursed pursuant to Section 3.5.

                  "L/C Participants": with respect to any Letter of Credit, the
collective reference to all the Lenders other than the Issuing Lender that
issued such letter of Credit.

                  "Lehman Entity": any of Lehman Commercial Paper Inc. or any of
its affiliates (including Syndicated Loan Funding Trust).

                  "Lender Addendum": with respect to any initial Lender, a
Lender Addendum, substantially in the form of Exhibit I, to be executed and
delivered by such Lender on the Closing Date as provided in Section 10.17.

                  "Lenders": as defined in the preamble hereto.

                  "Letters of Credit": as defined in Section 3.1(a).

                  "Lien": any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), charge or other
security interest or any preference, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever (including, without
limitation, any conditional sale or other title retention agreement and any
capital lease having substantially the same economic effect as any of the
foregoing).

                  "Loan": as defined in Section 2.1.

                  "Loan Documents": this Agreement, the Security Documents, the
Fee Letter, the Applications and the Notes.

                  "Loan Parties": Holdings, the Borrower and each Subsidiary of
the Borrower that is a party to a Loan Document.

                  "Material Adverse Effect": a material adverse effect on (a)
the condition (financial or otherwise), operations, business, assets,
liabilities or prospects of Holdings, the Borrower and its Subsidiaries taken as
a whole, (b) the ability of any Loan Party to perform any material obligation
under any Loan Document to which it is a party or (c) the material rights or
remedies of the Agents or the Lenders hereunder or thereunder.




                                                                              16

                   "Material Environmental Amount": an amount or amounts payable
by the Borrower and/or any of its Subsidiaries, in the aggregate in excess of
$1,000,000, for: costs to comply with any Environmental Law; costs of any
investigation, and any remediation, of any Material of Environmental Concern;
and compensatory damages (including, without limitation damages to natural
resources), punitive damages, fines, and penalties pursuant to any Environmental
Law.

                  "Material Subsidiary": any Subsidiary other than an Inactive
Subsidiary.

                  "Materials of Environmental Concern": any gasoline or
petroleum (including crude oil or any fraction thereof) or petroleum products,
polychlorinated biphenyls, urea-formaldehyde insulation, asbestos, pollutants,
contaminants, radioactivity, and any other substances or forces of any kind,
whether or not any such substance or force is defined as hazardous or toxic
under any Environmental Law, that is regulated pursuant to or could give rise to
liability under any Environmental Law.

                  "Mortgages": the collective reference to (a) the Existing
Mortgages and (b) each of the Mortgage Amendments.

                  "Mortgage Amendments": each of the amendments to any mortgage
or deed of trust executed and delivered by any Loan Party, substantially in the
form of Exhibit D (with such changes thereto as shall be advisable under the law
of the jurisdiction in which such mortgage or deed of trust is to be recorded as
the Administrative Agent on or before the Closing Date shall reasonably
determine is necessary to maintain the priority of the first mortgage Lien
encumbering the relevant Mortgaged Property).

                  "Mortgaged Property": the real properties listed on Schedule
1.1(a).

                  "Multiemployer Plan": a Plan that is a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.

                  "Net Cash Proceeds": (a) in connection with any Asset Sale or
any Recovery Event, the proceeds thereof in the form of cash and Cash
Equivalents (including any such proceeds received by way of deferred payment of
principal pursuant to a note or installment receivable or purchase price
adjustment receivable or otherwise, but only as and when received) of such Asset
Sale or Recovery Event, net of reasonable attorneys' fees, accountants' fees,
investment banking fees, amounts required to be applied to the repayment of
Indebtedness secured by a Lien expressly permitted hereunder on any asset which
is the subject of such Asset Sale or Recovery Event (other than any Lien
pursuant to a Security Document) and other customary fees and expenses actually
incurred in connection therewith and net of taxes paid or reasonably estimated
to be payable as a result thereof (after taking into account any available tax
credits or deductions and any tax sharing arrangements), (b) in connection with
any issuance or sale of equity securities or debt securities or instruments or
the incurrence of loans, the cash proceeds received from such issuance or
incurrence, net of reasonable attorneys' fees, investment banking fees,
accountants' fees, underwriting discounts and commissions and other customary
fees and expenses actually incurred in connection therewith and (c) in
connection with any




                                                                              17

Purchase Price Refund, the cash amount thereof, net of any expenses incurred in
the collection thereof.

                  "Non-Excluded Taxes": as defined in Section 2.15(a).

                  "Non-Recourse Debt": Indebtedness (a) as to which none of
Holdings, the Borrower nor any of its Subsidiaries (other than the Non-Recourse
Subsidiary that is the obligor on such Indebtedness) (i) provides credit support
of any kind (including any undertaking, agreement or instrument that would
constitute Indebtedness), (ii) is directly or indirectly liable (as a guarantor
or otherwise), or (iii) constitutes the lender; (b) no default with respect to
which (including any rights that the holders thereof may have to take
enforcement action against any Non-Recourse Subsidiary) would permit (upon
notice, lapse of time or both) any holder of any other Indebtedness (other than
the Obligations) of Holdings, the Borrower or any of its Subsidiaries to declare
a default on such other Indebtedness or cause the payment thereof to be
accelerated or payable prior to its stated maturity; (c) as to which the lenders
thereunder will not have any recourse to the Capital Stock or assets of
Holdings, the Borrower or any of Subsidiaries (other than the Non-Recourse
Subsidiary that is the obligor on such Indebtedness); and (d) the Net Cash
Proceeds of which are used to finance the purchase of Property used in the
business of the Borrower and its Subsidiaries or improvements made to such
Property.

                  "Non-Recourse Subsidiary": any Subsidiary that incurs
Non-Recourse Debt and that has no material Property other than the Property that
was purchased or improved with the proceeds of such Non-Recourse Debt.

                  "Non-U.S. Lender": as defined in Section 2.15(d).

                  "Obligations": the unpaid principal of and interest on
(including, without limitation, interest accruing after the maturity of the
Loans and Reimbursement Obligations and interest accruing after the filing of
any petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to the Borrower, whether or not a
claim for post-filing or post-petition interest is allowed in such proceeding)
the Loans, the Reimbursement Obligations and all other obligations and
liabilities of Holdings and the Borrower or any Subsidiary to the Administrative
Agent or to any Lender or any Qualified Counterparty, whether direct or
indirect, absolute or contingent, due or to become due, or now existing or
hereafter incurred, which may arise under, out of, or in connection with, this
Agreement, any other Loan Document, the Letters of Credit, any Specified Hedge
Agreement or any other document made, delivered or given in connection herewith
or therewith, whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses (including, without limitation,
all fees, charges and disbursements of counsel to the Administrative Agent or to
any Lender that are required to be paid by the Borrower pursuant hereto) or
otherwise; provided, that (i) obligations of the Borrower or any Subsidiary
under any Specified Hedge Agreement shall be secured and guaranteed pursuant to
the Security Documents only to the extent that, and for so long as, the other
Obligations are so secured and guaranteed and (ii) any release of Collateral or
Guarantors effected in the manner permitted by this Agreement shall not require
the consent of holders of obligations under Specified Hedge Agreements.




                                                                              18

                  "Omnicare": Omnicare, Inc., a Delaware corporation.

                  "Other Taxes": any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made hereunder or from the execution, delivery
or enforcement of, or otherwise with respect to, this Agreement or any other
Loan Document.

                  "Parent": Extendicare Inc., a Canadian limited company.

                  "Participant": as defined in Section 10.6(b).

                  "Payment Office": the office specified from time to time by
the Administrative Agent as its payment office by notice to the Borrower and the
Lenders.

                  "Payoff Letter": the payoff letter dated June 28, 2002 between
the Existing Agent, Holdings and the Borrower pursuant to which the Borrower
repaid all outstanding Existing Term Loans and Existing Revolving Credit Loans
under the Existing Revolving Credit Facility and reduced the commitments under
the Existing Revolving Credit Facility to $105,000,000.

                  "PBGC": the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA (or any successor).

                  "Permitted Non-Recourse Debt": Non-Recourse Debt permitted to
be incurred by Section 7.2.

                  "Person": an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust, unincorporated
association, joint venture, Governmental Authority or other entity of whatever
nature.

                  "Plan": at a particular time, any employee benefit plan that
is covered by ERISA and in respect of which the Borrower or a Commonly
Controlled Entity is (or, if such plan were terminated at such time, would under
Section 4069 of ERISA be deemed to be) an "employer" as defined in Section 3(5)
of ERISA.

                  "Pricing Grid": the pricing grid attached hereto as Annex A.

                  "Pro Forma Balance Sheet": as defined in Section 4.1(a).

                  "Projections": as defined in Section 6.2(c).

                  "Property": any right or interest in or to property of any
kind whatsoever, whether real, personal or mixed and whether tangible or
intangible, including, without limitation, Capital Stock.

                  "Purchase Price Refund": any amount received by Holdings, the
Borrower or any Subsidiary as a result of a purchase price adjustment or similar
event in connection with any acquisition of Property by Holdings, the Borrower
or any Subsidiary.




                                                                              19

                  "Qualified Counterparty": with respect to any Specified Hedge
Agreement, any counterparty thereto that, at the time such Specified Hedge
Agreement was entered into, was a Lender or an affiliate of a Lender.

                  "Recovery Event": any settlement of or payment in respect of
any property or casualty insurance claim or any condemnation proceeding relating
to any asset of Holdings, the Borrower or any of its Subsidiaries.

                  "Reference Lender": Deutsche Bank, New York Office.

                  "Register": as defined in Section 10.6(d).

                  "Regulation H": Regulation H of the Board as in effect from
time to time.

                  "Regulation U": Regulation U of the Board as in effect from
time to time.

                  "Reimbursement Obligation": the obligation of the Borrower to
reimburse each Issuing Lender pursuant to Section 3.5 for amounts drawn under
Letters of Credit issued by such Issuing Lender.

                  "Reinvestment Deferred Amount": with respect to any
Reinvestment Event, the aggregate Net Cash Proceeds received by Holdings, the
Borrower or any of its Subsidiaries in connection therewith that are not applied
to prepay the Revolving Credit Loans pursuant to Section 2.7(b) as a result of
the delivery of a Reinvestment Notice.

                  "Reinvestment Event": any Asset Sale, Purchase Price Refund or
Recovery Event in respect of which the Borrower has delivered a Reinvestment
Notice.

                  "Reinvestment Notice": a written notice executed by a
Responsible Officer stating that no Default or Event of Default has occurred and
is continuing and that the Borrower (directly or indirectly through a
Subsidiary) intends and expects to use all or a specified portion of the Net
Cash Proceeds of an Asset Sale, Purchase Price Refund or Recovery Event to
acquire assets (other than inventory) useful in its business.

                  "Reinvestment Prepayment Amount": with respect to any
Reinvestment Event, the Reinvestment Deferred Amount relating thereto less any
amount expended prior to the relevant Reinvestment Prepayment Date to acquire
assets (other than inventory) useful in the Borrower's business.

                  "Reinvestment Prepayment Date": with respect to any
Reinvestment Event, the earlier of (a) the date occurring one year after such
Reinvestment Event and (b) the date on which the Borrower shall have determined
not to, or shall have otherwise ceased to, acquire assets (other than inventory)
useful in the Borrower's business with all or any portion of the relevant
Reinvestment Deferred Amount.

                  "Related Fund": with respect to any Lender, any fund that (a)
invests in commercial loans and (b) is managed or advised by the same investment
advisor as such Lender, by such Lender or an Affiliate of such Lender.




                                                                              20

                  "Reorganization": with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of Section 4241
of ERISA.

                  "Reportable Event": any of the events set forth in Section
4043(c) of ERISA, other than those events as to which the thirty day notice
period is waived under subsections .27, .28, .29, .30, .31, .32, .34 or .35 of
PBGC Reg.ss. 4043.

                  "Required Lenders": at any time, the holders of more than
66-2/3% of the Total Revolving Credit Commitments then in effect or, if the
Revolving Credit Commitments have been terminated, the Total Revolving
Extensions of Credit then outstanding.

                  "Requirement of Law": as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its Property or to which such Person or
any of its Property is subject.

                  "Responsible Officer": the chief executive officer, senior
vice president, vice president or chief financial officer of the Borrower, but
in any event, with respect to financial matters, the chief financial officer of
the Borrower.

                  "Restricted Payments": as defined in Section 7.6.

                  "Revolving Credit Commitment": as to any Lender, the
obligation of such Lender, if any, to make Revolving Credit Loans and
participate in Letters of Credit, in an aggregate principal and/or face amount
not to exceed the amount set forth under the heading "Revolving Credit
Commitment" on the Lender Addendum delivered by such Lender, or, as the case may
be, in the Assignment and Acceptance pursuant to which such Lender became a
party hereto, as the same may be changed from time to time pursuant to the terms
hereof. The original aggregate amount of the Total Revolving Credit Commitments
is $105,000,000.

                  "Revolving Credit Commitment Period": the period from and
including the Closing Date to the Revolving Credit Termination Date.

                  "Revolving Credit Note": as defined in Section 2.3.

                  "Revolving Credit Percentage": as to any Lender at any time,
the percentage which such Lender's Revolving Credit Commitment then constitutes
of the Total Revolving Credit Commitments (or, at any time after the Revolving
Credit Commitments shall have expired or terminated, the percentage which the
aggregate amount of such Lender's Revolving Extensions of Credit then
outstanding constitutes of the amount of the Total Revolving Extensions of
Credit then outstanding).

                  "Revolving Credit Termination Date": June 28, 2007.

                  "Revolving Extensions of Credit": as to any Lender at any
time, an amount equal to the sum of (a) the aggregate principal amount of all
Loans made by such Lender then outstanding, and (b) the aggregate amount of such
Lender's participating interests in the L/C





                                                                              21

Obligations then outstanding (or, in the case of each Issuing Lender, such
Issuing Lender's interest remaining in such L/C Obligations after giving effect
to the grant of participating interests therein to the other Lenders pursuant to
Section 3.4).

                  "SEC": the Securities and Exchange Commission (or successors
thereto or an analogous Governmental Authority).

                  "Secured Parties": as defined in the Guarantee and Collateral
Agreement.

                  "Securities Account": each "securities account" (as defined in
Section 8-501 of the New York Uniform Commercial Code) in respect of which the
Borrower or any of its Subsidiaries (other than any Excluded Foreign Subsidiary)
is the holder of the securities entitlements carried in such securities account.

                  "Security Documents": the collective reference to the
Guarantee and Collateral Agreement, the Mortgages and all other security
documents hereafter delivered to the Administrative Agent granting a Lien on any
Property of any Person to secure the obligations and liabilities of any Loan
Party under any Loan Document.

                  "Senior Note Indenture": the Indenture entered into by the
Borrower in connection with the issuance of the Senior Notes, together with all
instruments and other agreements entered into by the Borrower or such
Subsidiaries in connection therewith, as the same may be amended, supplemented
or otherwise modified from time to time in accordance with Section 7.9.

                  "Senior Notes": the Borrower's unsecured 9.50% Senior Notes,
due 2010, issued on the Closing Date in the aggregate principal amount of
$150,000,000.

                  "Senior Subordinated Note Indenture": the Indenture entered
into by the Borrower in connection with the issuance of the Senior Subordinated
Notes, together with all instruments and other agreements entered into by the
Borrower or such Subsidiaries in connection therewith, as the same may be
amended, supplemented or otherwise modified from time to time in accordance with
Section 7.9.

                  "Senior Subordinated Notes": the Borrower's 9.35% Senior
Subordinated Notes due 2007.

                  "Single Employer Plan": any Plan that is covered by Title IV
of ERISA, but which is not a Multiemployer Plan.

                  "Solvent": with respect to any Person, as of any date of
determination, (a) the amount of the "present fair saleable value" of the assets
of such Person will, as of such date, exceed the amount of all "liabilities of
such Person, contingent or otherwise", as of such date, as such quoted terms are
determined in accordance with applicable federal and state laws governing
determinations of the insolvency of debtors, (b) the present fair saleable value
of the assets of such Person will, as of such date, be greater than the amount
that will be required to pay the liability of such Person on its debts as such
debts become absolute and matured, (c) such Person will not have, as of such
date, an unreasonably small amount of capital with which to conduct its



                                                                              22

business, and (d) such Person will be able to pay its debts as they mature. For
purposes of this definition, (i) "debt" means liability on a "claim", and (ii)
"claim" means any (x) right to payment, whether or not such a right is reduced
to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured or unsecured or (y) right to an
equitable remedy for breach of performance if such breach gives rise to a right
to payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured or unmatured, disputed, undisputed, secured
or unsecured.

                  "Specified Change of Control": a "Change of Control", or like
event, as defined in the Senior Subordinated Note Indenture or in the Senior
Note Indenture.

                  "Specified Hedge Agreement": any Hedge Agreement entered into
by (a) the Borrower or any of its Subsidiaries and (b) any Person that, at the
time such Hedge Agreement is entered into, is a Qualified Counterparty.

                  "Subsidiary": as to any Person, a corporation, partnership,
limited liability company or other entity of which shares of stock or other
ownership interests having ordinary voting power (other than stock or such other
ownership interests having such power only by reason of the happening of a
contingency) to elect a majority of the board of directors or other managers of
such corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly through one
or more intermediaries, or both, by such Person. Unless otherwise qualified, all
references to a "Subsidiary" or to "Subsidiaries" in this Agreement shall refer
to a Subsidiary or Subsidiaries of the Borrower.

                  "Subsidiary Guarantor": each Material Subsidiary of the
Borrower other than any Excluded Foreign Subsidiary.

                  "Total Revolving Credit Commitments": at any time, the
aggregate amount of the Revolving Credit Commitments then in effect.

                  "Total Revolving Extensions of Credit": at any time, the
aggregate amount of the Revolving Extensions of Credit of the Lenders
outstanding at such time.

                  "Transferee": as defined in Section 10.15.

                  "Transferred Properties": the collective reference to (a) all
of the Borrower's Texas nursing home operations (seventeen nursing homes with
capacity of 1,421 residents) transferred to affiliates of Senior Health
Properties-Texas, Inc. and (b) all of the Borrower's Florida facilities (32
facilities with 3,427 beds) disposed of or leased through a series of
transactions, including fifteen facilities transferred to Greystone Tribeca
Acquisition LLC, nine facilities leased and subsequently sold to Tandem Health
Care, Inc. and six facilities leased to Senior Health Properties-South, Inc.

                  "Type": as to any Loan, its nature as a Base Rate Loan or a
Eurodollar Loan.




                                                                              23

                  "Wholly Owned Subsidiary": as to any Person, any other Person
all of the Capital Stock of which (other than directors' qualifying shares
required by law) is owned by such Person directly and/or through other Wholly
Owned Subsidiaries.

                  "Wholly Owned Subsidiary Guarantor": any Subsidiary Guarantor
that is a Wholly Owned Subsidiary of the Borrower.

                  1.2 Other Definitional Provisions. (a) Unless otherwise
specified therein, all terms defined in this Agreement shall have the defined
meanings when used in the other Loan Documents or any certificate or other
document made or delivered pursuant hereto or thereto.

                  (b) As used herein and in the other Loan Documents, and any
certificate or other document made or delivered pursuant hereto or thereto,
accounting terms not defined in Section 1.1 and accounting terms partly defined
in Section 1.1, to the extent not defined, shall have the respective meanings
given to them under GAAP.

                  (c) The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and Section,
Schedule and Exhibit references are to this Agreement unless otherwise
specified.

                  (d) The meanings given to terms defined herein shall be
equally applicable to both the singular and plural forms of such terms.

                  (e) All calculations of financial ratios set forth in Section
7.1 and the calculation of the Consolidated Senior Leverage Ratio for purposes
of determining the Applicable Margin shall be calculated to the same number of
decimal places as the relevant ratios are expressed in and shall be rounded
upward if the number in the decimal place immediately following the last
calculated decimal place is five or greater. For example, if the relevant ratio
is to be calculated to the hundredth decimal place and the calculation of the
ratio is 5.126, the ratio will be rounded up to 5.13.

         Section 2. AMOUNT AND TERMS OF REVOLVING CREDIT COMMITMENTS

                  2.1 Revolving Credit Commitments. (a) Subject to the terms and
conditions hereof, the Lenders severally agree to make revolving credit loans
("Loans") to the Borrower from time to time during the Revolving Credit
Commitment Period in an aggregate principal amount at any one time outstanding
for each Lender which, when added to such Lender's Revolving Credit Percentage
of the sum of the L/C Obligations then outstanding, does not exceed the amount
of such Lender's Revolving Credit Commitment. During the Revolving Credit
Commitment Period the Borrower may use the Revolving Credit Commitments by
borrowing, prepaying the Loans in whole or in part, and reborrowing, all in
accordance with the terms and conditions hereof. The Loans may from time to time
be Eurodollar Loans or Base Rate Loans, as determined by the Borrower and
notified to the Administrative Agent in accordance with Sections 2.5 and 2.8,
provided that no Loan shall be made as a Eurodollar Loan after the day that is
one month prior to the Revolving Credit Termination Date.




                                                                              24

                  (b) Pursuant to the Existing Credit Agreement, the Existing
Lenders made Existing Revolving Credit Loans to the Borrower; from and after the
Closing Date, any Existing Revolving Credit Loans outstanding on the Closing
Date shall constitute Loans under this Agreement until repaid in accordance with
this Agreement.

                  (c) The Borrower shall repay all outstanding Loans on the
Revolving Credit Termination Date (or on such earlier date on which the Loans
become due and payable pursuant to Section 8).

                  2.2 Procedure for Revolving Credit Borrowing. The Borrower may
borrow under the Revolving Credit Commitments on any Business Day during the
Revolving Credit Commitment Period, provided that the Borrower shall deliver to
the Administrative Agent a Borrowing Notice (which Borrowing Notice must be
received by the Administrative Agent prior to (a) 12:00 Noon, New York City
time, three Business Days prior to the requested Borrowing Date, in the case of
Eurodollar Loans, or (b) 1:00 p.m., New York City time, one Business Day prior
to the requested Borrowing Date, in the case of Base Rate Loans). Each borrowing
of Loans under the Revolving Credit Commitments shall be in an amount equal to
(x) in the case of Base Rate Loans, $1,000,000 or a whole multiple thereof (or,
if the then aggregate Available Revolving Credit Commitments are less than
$1,000,000, such lesser amount) and (y) in the case of Eurodollar Loans,
$3,000,000 or a whole multiple of $1,000,000 in excess thereof. Upon receipt of
any such Borrowing Notice from the Borrower, the Administrative Agent shall
promptly notify each Lender thereof. Each Lender will make its Revolving Credit
Percentage of the amount of each borrowing of Loans available to the
Administrative Agent for the account of the Borrower at the Funding Office prior
to 1:00 p.m., New York City time, on the Borrowing Date requested by the
Borrower in funds immediately available to the Administrative Agent. Such
borrowing will then be made available to the Borrower by the Administrative
Agent in like funds as received by the Administrative Agent.

                  2.3 Repayment of Loans; Evidence of Debt. (a) The Borrower
hereby unconditionally promises to pay to the Administrative Agent for the
account of the appropriate Lender, the then unpaid principal amount of each Loan
of such Lender on the Revolving Credit Termination Date (or on such earlier date
on which the Loans become due and payable pursuant to Section 8). The Borrower
hereby further agrees to pay interest on the unpaid principal amount of the
Loans from time to time outstanding from the date hereof until payment in full
thereof at the rates per annum, and on the dates, set forth in Section 2.10.

                  (b) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing indebtedness of the Borrower to such
Lender resulting from each Loan of such Lender from time to time, including the
amounts of principal and interest payable and paid to such Lender from time to
time under this Agreement.

                  (c) The Administrative Agent, on behalf of the Borrower, shall
maintain the Register pursuant to Section 10.6(d), and a subaccount therein for
each Lender, in which shall be recorded (i) the amount of each Loan made
hereunder and any Note evidencing such Loan, the Type of such Loan and each
Interest Period applicable thereto, (ii) the amount of any principal or interest
due and payable or to become due and payable from the Borrower to each Lender



                                                                              25

hereunder and (iii) both the amount of any sum received by the Administrative
Agent hereunder from the Borrower and each Lender's share thereof.

                  (d) The entries made in the Register and the accounts of each
Lender maintained pursuant to Section 2.3(b) shall, to the extent permitted by
applicable law, be prima facie evidence of the existence and amounts of the
obligations of the Borrower therein recorded; provided, however, that the
failure of any Lender or the Administrative Agent to maintain the Register or
any such account, or any error therein, shall not in any manner affect the
obligation of the Borrower to repay (with applicable interest) the Loans made to
the Borrower by such Lender in accordance with the terms of this Agreement.

                  (e) The Borrower agrees that, upon the request to the
Administrative Agent by any Lender, the Borrower will promptly execute and
deliver to such Lender a promissory note of the Borrower evidencing any Loans of
such Lender, substantially in the form of Exhibit G ("Revolving Credit Note"),
with appropriate insertions as to date and principal amount; provided, that
delivery of Revolving Credit Notes shall not be a condition precedent to the
occurrence of the Closing Date or the making of the Loans on the Closing Date.

                  2.4 Commitment Fees, etc. (a) The Borrower agrees to pay to
the Administrative Agent for the account of each Lender a commitment fee for the
period from and including the Closing Date to the last day of the Revolving
Credit Commitment Period, computed at the Commitment Fee Rate on the average
daily amount of the Available Revolving Credit Commitment of such Lender during
the period for which payment is made, payable quarterly in arrears on the last
day of each March, June, September and December and on the Revolving Credit
Termination Date, commencing on the first of such dates to occur after the date
hereof.

                  (b) The Borrower agrees to pay to the Administrative Agent the
fees in the amounts and on the dates from time to time agreed to in writing by
the Borrower and the Administrative Agent.

                  2.5 Termination or Reduction of Revolving Credit Commitments.
The Borrower shall have the right, upon not less than three Business Days'
notice to the Administrative Agent, to terminate the Revolving Credit
Commitments or, from time to time, to reduce the aggregate amount of the
Revolving Credit Commitments; provided that no such termination or reduction of
Revolving Credit Commitments shall be permitted if, after giving effect thereto
and to any prepayments of the Loans made, or terminations or expirations of
Letters of Credit occurring, on the effective date thereof, the Total Revolving
Extensions of Credit would exceed the Total Revolving Credit Commitments. Any
such reduction shall be in an amount equal to (i) $1,000,000, or a whole
multiple thereof or (ii) the then aggregate Available Revolving Credit
Commitments, and shall reduce permanently the Revolving Credit Commitments then
in effect.

                  2.6 Optional Prepayments. (a) The Borrower may at any time and
from time to time prepay the Loans, in whole or in part, without premium or
penalty (except as otherwise provided herein), upon irrevocable notice delivered
to the Administrative Agent at least three Business Days prior thereto in the
case of Eurodollar Loans and no later than 10:00



                                                                              26

a.m. on the date of prepayment in the case of Base Rate Loans, which notice
shall specify the date and amount of such prepayment, and whether such
prepayment is of Eurodollar Loans or Base Rate Loans; provided, that if a
Eurodollar Loan is prepaid on any day other than the last day of the Interest
Period applicable thereto, the Borrower shall also pay any amounts owing
pursuant to Section 2.16. Upon receipt of any such notice the Administrative
Agent shall promptly notify each Lender thereof. If any such notice is given,
the amount specified in such notice shall be due and payable on the date
specified therein, together with (except in the case of Base Rate Loans) accrued
interest to such date on the amount prepaid. Partial prepayments of Loans shall
be in an aggregate principal amount of $1,000,000 or a whole multiple thereof or
the aggregate principal amount of the Loans, or the applicable Eurodollar
Tranche thereof, then outstanding.

                  2.7 Mandatory Prepayments and Commitment Reductions. (a)
Unless the Required Lenders shall otherwise agree, if any Indebtedness shall be
incurred by Holdings, the Borrower or any of its Subsidiaries (excluding any
Indebtedness incurred in accordance with Section 7.2 as in effect on the date of
this Agreement), then on the date of such incurrence, the Loans shall be prepaid
(without any automatic reduction of Revolving Credit Commitments), by an amount
equal to the amount of the Net Cash Proceeds of such incurrence. The provisions
of this Section do not constitute a consent to the incurrence of any
Indebtedness by Holdings, the Borrower or any of its Subsidiaries.

                  (b) Unless the Required Lenders shall otherwise agree, if on
any date Holdings, the Borrower or any of its Subsidiaries shall receive Net
Cash Proceeds from any Asset Sale, Purchase Price Refund or Recovery Event then,
unless a Reinvestment Notice shall be delivered in respect thereof, on the date
of receipt by Holdings, the Borrower or any of its Subsidiaries of such Net Cash
Proceeds, the Loans shall be prepaid (without any automatic reduction of
Revolving Credit Commitments) by an amount equal to the amount of such Net Cash
Proceeds; provided, that, notwithstanding the foregoing, (i) the aggregate Net
Cash Proceeds of Asset Sales and Recovery Events that may be excluded from the
foregoing requirement pursuant to a Reinvestment Notice shall not exceed
$20,000,000 in any fiscal year of the Borrower and (ii) on each Reinvestment
Prepayment Date the Loans shall be prepaid (without any automatic reduction of
Revolving Credit Commitments) by an amount equal to the Reinvestment Prepayment
Amount with respect to the relevant Reinvestment Event. The provisions of this
Section do not constitute a consent to the consummation of any Disposition not
permitted by Section 7.5.

                  2.8 Conversion and Continuation Options. (a) The Borrower may
elect from time to time to convert Eurodollar Loans to Base Rate Loans by giving
the Administrative Agent at least two Business Days' prior irrevocable notice of
such election, provided that any such conversion of Eurodollar Loans may be made
only on the last day of an Interest Period with respect thereto. The Borrower
may elect from time to time to convert Base Rate Loans to Eurodollar Loans by
giving the Administrative Agent at least three Business Days' prior irrevocable
notice of such election (which notice shall specify the length of the initial
Interest Period therefor), provided that no Base Rate Loan may be converted into
a Eurodollar Loan (i) when any Event of Default has occurred and is continuing
and the Administrative Agent has, or the Required Lenders have, determined in
its or their sole discretion not to permit such conversions or (ii) after the
date that is one month prior to the Revolving Credit Termination




                                                                              27

Date. Upon receipt of any such notice the Administrative Agent shall promptly
notify each Lender thereof.

                  (b) The Borrower may elect to continue any Eurodollar Loan as
such upon the expiration of the then current Interest Period with respect
thereto by giving irrevocable notice to the Administrative Agent at least three
Business Days' prior to such election, in accordance with the applicable
provisions of the term "Interest Period" set forth in Section 1.1, of the length
of the next Interest Period to be applicable to such Loans, provided that no
Eurodollar Loan may be continued as such (i) when any Event of Default has
occurred and is continuing and the Administrative Agent has, or the Required
Lenders have, determined in its or their sole discretion not to permit such
continuations or (ii) after the date that is one month prior to the Revolving
Credit Termination Date, and provided, further, that if the Borrower shall fail
to give any required notice as described above in this paragraph or if such
continuation is not permitted pursuant to the preceding proviso, such Loans
shall be converted automatically to Base Rate Loans on the last day of such then
expiring Interest Period. Upon receipt of any such notice the Administrative
Agent shall promptly notify each Lender thereof.

                  2.9 Minimum Amounts and Maximum Number of Eurodollar Tranches.
Notwithstanding anything to the contrary in this Agreement, all borrowings,
conversions, continuations and optional prepayments of Eurodollar Loans and all
selections of Interest Periods shall be in such amounts and be made pursuant to
such elections so that, (a) after giving effect thereto, the aggregate principal
amount of the Eurodollar Loans comprising each Eurodollar Tranche shall be equal
to $3,000,000 or a whole multiple of $1,000,000 in excess thereof and (b) no
more than eight Eurodollar Tranches shall be outstanding at any one time.

                  2.10 Interest Rates and Payment Dates. (a) Each Eurodollar
Loan shall bear interest for each day during each Interest Period with respect
thereto at a rate per annum equal to the Eurodollar Rate determined for such day
plus the Applicable Margin in effect for such day.

                  (b) Each Base Rate Loan shall bear interest for each day on
which it is outstanding at a rate per annum equal to the Base Rate in effect for
such day plus the Applicable Margin in effect for such day.

                  (c) (i) If all or a portion of the principal amount of any
Loan or Reimbursement Obligation shall not be paid when due (whether at the
stated maturity, by acceleration or otherwise), all outstanding Loans and
Reimbursement Obligations (whether or not overdue) (to the extent legally
permitted) shall bear interest at a rate per annum that is equal to (x) in the
case of the Loans, the rate that would otherwise be applicable thereto pursuant
to the foregoing provisions of this Section plus 2% or (y) in the case of
Reimbursement Obligations, the rate applicable to Base Rate Loans plus 2%, and
(ii) if all or a portion of any interest payable on any Loan or Reimbursement
Obligation or any commitment fee or other amount payable hereunder shall not be
paid when due (whether at the stated maturity, by acceleration or otherwise),
such overdue amount shall bear interest at a rate per annum equal to the rate
then applicable to Base Rate Loans plus 2%, in each case, with respect to
clauses (i) and (ii) above, from the date of such non-payment until such amount
is paid in full (after as well as before judgment).

                                                                              28


                  (d) Interest shall be payable in arrears on each Interest
Payment Date, provided that interest accruing pursuant to paragraph (c) of this
Section shall be payable from time to time on demand.

                  2.11 Computation of Interest and Fees. (a) Interest, fees,
commissions payable pursuant hereto shall be calculated on the basis of a
360-day year for the actual days elapsed, except that, with respect to Base Rate
Loans on which interest is calculated on the basis of the Prime Rate, the
interest thereon shall be calculated on the basis of a 365- (or 366-, as the
case may be) day year for the actual days elapsed. The Administrative Agent
shall as soon as practicable notify the Borrower and the Lenders of each
determination of a Eurodollar Rate. Any change in the interest rate on a Loan
resulting from a change in the Base Rate or the Eurocurrency Reserve
Requirements shall become effective as of the opening of business on the day on
which such change becomes effective. The Administrative Agent shall as soon as
practicable notify the Borrower and the Lenders of the effective date and the
amount of each such change in interest rate.

                  (b) Each determination of an interest rate by the
Administrative Agent pursuant to any provision of this Agreement shall be
conclusive and binding on the Borrower and the Lenders in the absence of
manifest error. The Administrative Agent shall, at the request of the Borrower,
deliver to the Borrower a statement showing the quotations used by the
Administrative Agent in determining any interest rate pursuant to Section
2.10(a).

                  2.12 Inability to Determine Interest Rate. If prior to the
first day of any Interest Period:

                  (a) the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower) that, by reason
of circumstances affecting the relevant market, adequate and reasonable means do
not exist for ascertaining the Eurodollar Rate for such Interest Period, or

                  (b) the Administrative Agent shall have received notice from
the Required Lenders that the Eurodollar Rate determined or to be determined for
such Interest Period will not adequately and fairly reflect the cost to such
Lenders (as conclusively certified by such Lenders) of making or maintaining
their affected Loans during such Interest Period, the Administrative Agent shall
give telecopy or telephonic notice thereof to the Borrower and the relevant
Lenders as soon as practicable thereafter. If such notice is given (x) any
Eurodollar Loans requested to be made on the first day of such Interest Period
shall be made as Base Rate Loans, (y) any Loans that were to have been converted
on the first day of such Interest Period to Eurodollar Loans shall be continued
as Base Rate Loans and (z) any outstanding Eurodollar Loans shall be converted,
on the last day of the then current Interest Period with respect thereto, to
Base Rate Loans. Until such notice has been withdrawn by the Administrative
Agent, no further Eurodollar Loans shall be made or continued as such, nor shall
the Borrower have the right to convert Loans to Eurodollar Loans.

                  2.13 Pro Rata Treatment and Payments. (a) Each borrowing by
the Borrower from the Lenders hereunder, each payment by the Borrower on account
of any commitment fee



                                                                              29

or Letter of Credit fee, and any reduction of the Revolving Credit Commitments
of the Lenders, shall be made pro rata according to the respective Revolving
Credit Percentages of the Lenders.

                  (b) Each payment (including each prepayment) by the Borrower
on account of principal of and interest on the Loans shall be made pro rata
according to the respective outstanding principal amounts of the Loans then held
by the Lenders. Each payment in respect of Reimbursement Obligations in respect
of any Letter of Credit shall be made to the Issuing Lender that issued such
Letter of Credit for the account of the Lenders, if any, which participated in
such Letter of Credit pursuant to Section 3.4(a).

                  (c) The application of any payment of Loans (including
optional and mandatory prepayments) shall be made, first, to Base Rate Loans
and, second, to Eurodollar Loans. Each payment of the Loans (except in the case
of Base Rate Loans) shall be accompanied by accrued interest to the date of such
payment on the amount paid.

                  (d) All payments (including prepayments) to be made by the
Borrower hereunder, whether on account of principal, interest, fees or
otherwise, shall be made without setoff or counterclaim and shall be made prior
to 12:00 Noon, New York City time, on the due date thereof to the Administrative
Agent, for the account of the relevant Lenders, at the Payment Office, in
Dollars and in immediately available funds. Any payment made by the Borrower
after 12:00 Noon, New York City time, on any Business Day shall be deemed to
have been on the next following Business Day. The Administrative Agent shall
distribute such payments to the Lenders promptly upon receipt in like funds as
received. If any payment hereunder (other than payments on the Eurodollar Loans)
becomes due and payable on a day other than a Business Day, such payment shall
be extended to the next succeeding Business Day. If any payment on a Eurodollar
Loan becomes due and payable on a day other than a Business Day, the maturity
thereof shall be extended to the next succeeding Business Day unless the result
of such extension would be to extend such payment into another calendar month,
in which event such payment shall be made on the immediately preceding Business
Day. In the case of any extension of any payment of principal pursuant to the
preceding two sentences, interest thereon shall be payable at the then
applicable rate during such extension.

                  (e) Unless the Administrative Agent shall have been notified
in writing by any Lender prior to a borrowing that such Lender will not make the
amount that would constitute its share of such borrowing available to the
Administrative Agent, the Administrative Agent may assume that such Lender is
making such amount available to the Administrative Agent, and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. If such amount is not made available to the Administrative
Agent by the required time on the Borrowing Date therefor, such Lender shall pay
to the Administrative Agent, on demand, such amount with interest thereon at a
rate equal to the daily average Federal Funds Effective Rate for the period
until such Lender makes such amount immediately available to the Administrative
Agent. A certificate of the Administrative Agent submitted to any Lender with
respect to any amounts owing under this paragraph shall be conclusive in the
absence of manifest error. If such Lender's share of such borrowing is not made
available to the Administrative Agent by such Lender within three Business Days
after such Borrowing Date, the Administrative Agent shall also be entitled to
recover such amount with interest thereon at the rate per annum applicable to
Base Rate Loans, on demand, from the Borrower.



                                                                              30

                  (f) Unless the Administrative Agent shall have been notified
in writing by the Borrower prior to the date of any payment due to be made by
the Borrower hereunder that the Borrower will not make such payment to the
Administrative Agent, the Administrative Agent may assume that the Borrower is
making such payment, and the Administrative Agent may, but shall not be required
to, in reliance upon such assumption, make available to the Lenders their
respective pro rata shares of a corresponding amount. If such payment is not
made to the Administrative Agent by the Borrower within three Business Days
after such due date, the Administrative Agent shall be entitled to recover, on
demand, from each Lender to which any amount which was made available pursuant
to the preceding sentence, such amount with interest thereon at the rate per
annum equal to the daily average Federal Funds Effective Rate. Nothing herein
shall be deemed to limit the rights of the Administrative Agent or any Lender
against the Borrower or the rights of the Borrower against any Lender.

                  2.14 Requirements of Law. (a) If the adoption of or any change
in any Requirement of Law or in the interpretation or application thereof or
compliance by any Lender with any request or directive (whether or not having
the force of law) from any central bank or other Governmental Authority made
subsequent to the date hereof:

                        (i)      shall subject any Lender to any tax of any kind
                                 whatsoever with respect to this Agreement, any
                                 Letter of Credit, any Application or any
                                 Eurodollar Loan made by it, or change the basis
                                 of taxation of payments to such Lender in
                                 respect thereof (except for Non-Excluded Taxes
                                 covered by Section 2.15 and changes in the rate
                                 of tax on the overall net income of such
                                 Lender);

                        (ii)     shall impose, modify or hold applicable any
                                 reserve, special deposit, compulsory loan or
                                 similar requirement against assets held by,
                                 deposits or other liabilities in or for the
                                 account of, advances, loans or other extensions
                                 of credit by, or any other acquisition of funds
                                 by, any office of such Lender that is not
                                 otherwise included in the determination of the
                                 Eurodollar Rate hereunder; or

                        (iii)    shall impose on such Lender any other
                                 condition;

and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or issuing or participating in
Letters of Credit, or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, the Borrower shall promptly pay such Lender,
upon its demand, any additional amounts necessary to compensate such Lender for
such increased cost or reduced amount receivable. If any Lender becomes entitled
to claim any additional amounts pursuant to this Section, it shall promptly
notify the Borrower (with a copy to the Administrative Agent) of the event by
reason of which it has become so entitled.

                  (b) If any Lender shall have determined that the adoption of
or any change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof or compliance by such Lender or any
corporation controlling such Lender with any request or directive regarding
capital adequacy (whether or not having the force of law) from any



                                                                              31

Governmental Authority made subsequent to the date hereof shall have the effect
of reducing the rate of return on such Lender's or such corporation's capital as
a consequence of its obligations hereunder or under or in respect of any Letter
of Credit to a level below that which such Lender or such corporation could have
achieved but for such adoption, change or compliance (taking into consideration
such Lender's or such corporation's policies with respect to capital adequacy)
by an amount deemed by such Lender to be material, then from time to time, after
submission by such Lender to the Borrower (with a copy to the Administrative
Agent) of a written request therefor, the Borrower shall pay to such Lender such
additional amount or amounts as will compensate such Lender or such corporation
for such reduction.

                  (c) A certificate setting forth in reasonable detail
calculations as to any additional amounts payable pursuant to this Section
submitted by any Lender to the Borrower (with a copy to the Administrative
Agent) shall be conclusive in the absence of manifest error. The obligations of
the Borrower pursuant to this Section shall survive the termination of this
Agreement and the payment of the Loans and all other amounts payable hereunder.

                  2.15 Taxes. (a) All payments made by the Borrower under this
Agreement shall be made free and clear of, and without deduction or withholding
for or on account of, any present or future income, stamp or other taxes,
levies, imposts, duties, charges, fees, deductions or withholdings, now or
hereafter imposed, levied, collected, withheld or assessed by any Governmental
Authority, excluding net income taxes and franchise taxes (imposed in lieu of
net income taxes) imposed on any Agent or any Lender as a result of a present or
former connection between such Agent or such Lender and the jurisdiction of the
Governmental Authority imposing such tax or any political subdivision or taxing
authority thereof or therein (other than any such connection arising solely from
such Agent's or such Lender's having executed, delivered or performed its
obligations or received a payment under, or enforced, this Agreement or any
other Loan Document). If any such non-excluded taxes, levies, imposts, duties,
charges, fees, deductions or withholdings ("Non-Excluded Taxes") or any Other
Taxes are required to be withheld from any amounts payable to any Agent or any
Lender hereunder, the amounts so payable to such Agent or such Lender shall be
increased to the extent necessary to yield to such Agent or such Lender (after
payment of all Non-Excluded Taxes and Other Taxes) interest or any such other
amounts payable hereunder at the rates or in the amounts specified in this
Agreement; provided, however, that the Borrower shall not be required to
increase any such amounts payable to any Lender with respect to any Non-Excluded
Taxes (i) that are attributable to such Lender's failure to comply with the
requirements of paragraph (d) or (e) of this Section or (ii) that are United
States withholding taxes imposed on amounts payable to such Lender at the time
such Lender becomes a party to this Agreement, except to the extent that such
Lender's assignor (if any) was entitled, at the time of assignment, to receive
additional amounts from the Borrower with respect to such Non-Excluded Taxes
pursuant to this paragraph (a).

                  (b) In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.

                  (c) Whenever any Non-Excluded Taxes or Other Taxes are payable
by the Borrower, as promptly as possible thereafter the Borrower shall send to
the Administrative Agent for the account of the relevant Agent or Lender, as the
case may be, a certified copy of an original official receipt received by the
Borrower showing payment thereof. If the Borrower



                                                                              32

fails to pay any Non-Excluded Taxes or Other Taxes when due to the appropriate
taxing authority or fails to remit to the Administrative Agent the required
receipts or other required documentary evidence, the Borrower shall indemnify
the Agents and the Lenders for any incremental taxes, interest or penalties that
may become payable by any Agent or any Lender as a result of any such failure.
The agreements in this Section shall survive the termination of this Agreement
and the payment of the Loans and all other amounts payable hereunder.

                  (d) Each Lender (or Transferee) that is not a citizen or
resident of the United States of America, a corporation, partnership or other
entity created or organized in or under the laws of the United States of America
(or any jurisdiction thereof), or any estate or trust that is subject to federal
income taxation regardless of the source of its income (a "Non-U.S. Lender")
shall deliver to the Borrower and the Administrative Agent (or, in the case of a
Participant, to the Lender from which the related participation shall have been
purchased) two copies of either U.S. Internal Revenue Service Form W-8BEN or
Form W-8ECI, or, in the case of a Non-U.S. Lender claiming exemption from U.S.
federal withholding tax under Section 871(h) or 881(c) of the Code with respect
to payments of "portfolio interest" a statement substantially in the form of
Exhibit I and a Form W-8BEN, or any subsequent versions thereof or successors
thereto properly completed and duly executed by such Non-U.S. Lender claiming
complete exemption from, or a reduced rate of, U.S. federal withholding tax on
all payments by the Borrower under this Agreement and the other Loan Documents.
Such forms shall be delivered by each Non-U.S. Lender on or before the date it
becomes a party to this Agreement (or, in the case of any Participant, on or
before the date such Participant purchases the related participation). In
addition, each Non-U.S. Lender shall deliver such forms promptly upon the
obsolescence or invalidity of any form previously delivered by such Non-U.S.
Lender. Each Non-U.S. Lender shall promptly notify the Borrower at any time it
determines that it is no longer in a position to provide any previously
delivered certificate to the Borrower (or any other form of certification
adopted by the U.S. taxing authorities for such purpose). Notwithstanding any
other provision of this paragraph, a Non-U.S. Lender shall not be required to
deliver any form pursuant to this paragraph that such Non-U.S. Lender is not
legally able to deliver.

                  (e) A Lender that is entitled to an exemption from or
reduction of non-U.S. withholding tax under the law of the jurisdiction in which
the Borrower is located, or any treaty to which such jurisdiction is a party,
with respect to payments under this Agreement shall deliver to the Borrower
(with a copy to the Administrative Agent), at the time or times prescribed by
applicable law or reasonably requested by the Borrower, such properly completed
and executed documentation prescribed by applicable law as will permit such
payments to be made without withholding or at a reduced rate, provided that such
Lender is legally entitled to complete, execute and deliver such documentation
and in such Lender's reasonable judgment such completion, execution or
submission would not materially prejudice the legal position of such Lender.

                  2.16 Indemnity. The Borrower agrees to indemnify each Lender
for, and to hold each Lender harmless from, any loss or expense that such Lender
may sustain or incur as a consequence of (a) default by the Borrower in making a
borrowing of, conversion into or continuation of Eurodollar Loans after the
Borrower has given a notice requesting the same in accordance with the
provisions of this Agreement, (b) default by the Borrower in making any
prepayment after the Borrower has given a notice thereof in accordance with the
provisions of



                                                                              33

this Agreement or (c) the making of a prepayment or conversion of Eurodollar
Loans on a day that is not the last day of an Interest Period with respect
thereto. Such indemnification may include an amount equal to the excess, if any,
of (i) the amount of interest that would have accrued on the amount so prepaid,
or not so borrowed, converted or continued, for the period from the date of such
prepayment or of such failure to borrow, convert or continue to the last day of
such Interest Period (or, in the case of a failure to borrow, convert or
continue, the Interest Period that would have commenced on the date of such
failure) in each case at the applicable rate of interest for such Loans provided
for herein (excluding, however, the Applicable Margin included therein, if any)
over (ii) the amount of interest (as reasonably determined by such Lender) that
would have accrued to such Lender on such amount by placing such amount on
deposit for a comparable period with leading banks in the interbank Eurodollar
market. A certificate setting forth in reasonable detail calculations as to any
amounts payable pursuant to this Section submitted to the Borrower by any Lender
shall be conclusive in the absence of manifest error. This covenant shall
survive the termination of this Agreement and the payment of the Loans and all
other amounts payable hereunder.

                  2.17 Illegality. Notwithstanding any other provision herein,
if the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof shall make it unlawful for any Lender to
make or maintain Eurodollar Loans as contemplated by this Agreement, (a) the
commitment of such Lender hereunder to make Eurodollar Loans, continue
Eurodollar Loans as such and convert Base Rate Loans to Eurodollar Loans shall
forthwith be canceled and (b) such Lender's Loans then outstanding as Eurodollar
Loans, if any, shall be converted automatically to Base Rate Loans on the
respective last days of the then current Interest Periods with respect to such
Loans or within such earlier period as required by law. If any such conversion
of a Eurodollar Loan occurs on a day which is not the last day of the then
current Interest Period with respect thereto, the Borrower shall pay to such
Lender such amounts, if any, as may be required pursuant to Section 2.16.

                  2.18 Change of Lending Office. Each Lender agrees that, upon
the occurrence of any event giving rise to the operation of Section 2.14,
2.15(a) or 2.17 with respect to such Lender, it will, if requested by the
Borrower, use reasonable efforts (subject to overall policy considerations of
such Lender) to designate another lending office for any Loans affected by such
event with the object of avoiding the consequences of such event; provided, that
such designation is made on terms that, in the sole judgment of such Lender,
cause such Lender and its lending office(s) to suffer no economic, legal or
regulatory disadvantage, and provided, further, that nothing in this Section
shall affect or postpone any of the obligations of any Borrower or the rights of
any Lender pursuant to Section 2.14, 2.15(a) or 2.17.

                  2.19 Replacement of Lenders under Certain Circumstances. The
Borrower shall be permitted to replace any Lender that (a) requests
reimbursement for amounts owing pursuant to Section 2.14 or 2.15 or gives a
notice of illegality pursuant to Section 2.17 or (b) defaults in its obligation
to make Loans hereunder, with a replacement financial institution; provided that
(i) such replacement does not conflict with any Requirement of Law, (ii) no
Event of Default shall have occurred and be continuing at the time of such
replacement, (iii) prior to any such replacement, such Lender shall have taken
no action under Section 2.18 so as to eliminate the continued need for payment
of amounts owing pursuant to Section 2.14 or 2.15 or to eliminate the illegality
referred to in such notice of illegality given pursuant to Section 2.17,



                                                                              34

(iv) the replacement financial institution shall purchase, at par, all Loans and
other amounts owing to such replaced Lender on or prior to the date of
replacement, (v) the Borrower shall be liable to such replaced Lender under
Section 2.16 (as though Section 2.16 were applicable) if any Eurodollar Loan
owing to such replaced Lender shall be purchased other than on the last day of
the Interest Period relating thereto, (vi) the replacement financial
institution, if not already a Lender, shall be reasonably satisfactory to the
Administrative Agent, (vii) the replaced Lender shall be obligated to make such
replacement in accordance with the provisions of Section 10.6 (provided that the
Borrower shall be obligated to pay the registration and processing fee referred
to therein), (viii) the Borrower shall pay all additional amounts (if any)
required pursuant to Section 2.14 or 2.15, as the case may be, in respect of any
period prior to the date on which such replacement shall be consummated, and
(ix) any such replacement shall not be deemed to be a waiver of any rights that
the Borrower, the Administrative Agent or any other Lender shall have against
the replaced Lender.

                          SECTION 3. LETTERS OF CREDIT

                  3.1 L/C Commitment. (a) Subject to the terms and conditions
hereof, each Issuing Lender, in reliance on the agreements of the other Lenders
set forth in Section 3.4(a), agrees to issue letters of credit (the letters of
credit issued on and after the Closing Date pursuant to this Section 3
collectively, the "Letters of Credit") for the account of the Borrower on any
Business Day during the Revolving Credit Commitment Period in such form as may
be approved from time to time by such Issuing Lender; provided, that no Issuing
Lender shall have any obligation to issue any Letter of Credit if, after giving
effect to such issuance, (i) the L/C Obligations would exceed the L/C Commitment
or (ii) the aggregate amount of the Available Revolving Credit Commitments would
be less than zero. Each Letter of Credit shall (i) be in form and substance
reasonably acceptable to the Issuing Lender, (ii) be denominated in Dollars and
(iii) expire no later than the earlier of (x) the first anniversary of its date
of issuance and (y) the date which is five Business Days prior to the Revolving
Credit Termination Date; provided that any Letter of Credit with a one-year term
may provide for the renewal thereof for additional one-year periods (which shall
in no event extend beyond the date referred to in clause (y) above).

                  (b) No Issuing Lender shall at any time be obligated to issue
any Letter of Credit hereunder if such issuance would conflict with, or cause
such Issuing Lender or any L/C Participant to exceed any limits imposed by, any
applicable Requirement of Law.

                  3.2 Procedure for Issuance of Letter of Credit. The Borrower
may from time to time request that an Issuing Lender issue a Letter of Credit by
delivering to such Issuing Lender at its address for notices specified herein
(with a copy to the Administrative Agent) an Application therefor, completed to
the satisfaction of such Issuing Lender, and such other certificates, documents
and other papers and information as such Issuing Lender may request. Upon
receipt of any Application, an Issuing Lender will process such Application and
the certificates, documents and other papers and information delivered to it in
connection therewith in accordance with its customary procedures and shall
promptly issue the Letter of Credit requested thereby by issuing the original of
such Letter of Credit to the beneficiary thereof or as otherwise may be agreed
to by such Issuing Lender and the Borrower (but in no event shall any Issuing
Lender be required to issue any Letter of Credit earlier than three Business
Days after its receipt of the Application therefor and all such other
certificates, documents and other papers



                                                                              35

and information relating thereto). Promptly after issuance by an Issuing Lender
of a Letter of Credit, such Issuing Lender shall furnish a copy of such Letter
of Credit to the Borrower. Each Issuing Lender shall promptly give notice to the
Administrative Agent of the issuance of each Letter of Credit issued by such
Issuing Lender (including the amount thereof).

                  3.3 Fees and Other Charges. (a) The Borrower will pay a fee on
the aggregate drawable amount of all outstanding Letters of Credit at a per
annum rate equal to the Applicable Margin then in effect with respect to
Eurodollar Loans under the Revolving Credit Facility, which fee shall be shared
ratably among the Lenders in accordance with their respective Revolving Credit
Percentages and shall be payable quarterly in arrears on each L/C Fee Payment
Date after the issuance date. In addition, the Borrower shall pay to the
relevant Issuing Lender for its own account a fronting fee on the aggregate
drawable amount of all outstanding Letters of Credit issued by it at a per annum
rate agreed upon by the Borrower and such Issuing Lender, which fee shall be
payable quarterly in arrears on each L/C Fee Payment Date after the Issuance
Date.

                  (b) In addition to the foregoing fees, the Borrower shall pay
or reimburse each Issuing Lender for such normal and customary costs and
expenses as are incurred or charged by such Issuing Lender in issuing,
negotiating, effecting payment under, amending or otherwise administering any
Letter of Credit.

                  3.4 L/C Participations. (a) Effective on the date of issuance
thereof, each Issuing Lender irrevocably agrees to grant and hereby grants to
each L/C Participant, and, to induce each Issuing Lender to issue Letters of
Credit hereunder, each L/C Participant irrevocably agrees to accept and purchase
and hereby accepts and purchases from each Issuing Lender, on the terms and
conditions hereinafter stated, for such L/C Participant's own account and risk,
an undivided interest equal to such L/C Participant's Revolving Credit
Percentage in each Issuing Lender's obligations and rights under each Letter of
Credit issued by such Issuing Lender hereunder and the amount of each draft paid
by such Issuing Lender thereunder. Each L/C Participant unconditionally and
irrevocably agrees with each Issuing Lender that, if a draft is paid under any
Letter of Credit issued by such Issuing Lender for which such Issuing Lender is
not reimbursed in full by the Borrower in accordance with the terms of this
Agreement, such L/C Participant shall pay to such Issuing Lender upon demand at
such Issuing Lender's address for notices specified herein an amount equal to
such L/C Participant's Revolving Credit Percentage of the amount of such draft,
or any part thereof, that is not so reimbursed.

                  (b) If any amount required to be paid by any L/C Participant
to an Issuing Lender pursuant to Section 3.4(a) in respect of any unreimbursed
portion of any payment made by such Issuing Lender under any Letter of Credit is
paid to such Issuing Lender within three Business Days after the date such
payment is due, such L/C Participant shall pay to such Issuing Lender on demand
an amount equal to the product of (i) such amount, times (ii) the daily average
Federal Funds Effective Rate during the period from and including the date such
payment is required to the date on which such payment is immediately available
to such Issuing Lender, times (iii) a fraction the numerator of which is the
number of days that elapse during such period and the denominator of which is
360. If any such amount required to be paid by any L/C Participant pursuant to
Section 3.4(a) is not made available to such Issuing Lender by such L/C
Participant within three Business Days after the date such payment is due, such
Issuing Lender



                                                                              36

shall be entitled to recover from such L/C Participant, on demand, such amount
with interest thereon calculated from such due date at the rate per annum
applicable to Base Rate Loans. A certificate of such Issuing Lender submitted to
any L/C Participant with respect to any such amounts owing under this Section
shall be conclusive in the absence of manifest error.

                  (c) Whenever, at any time after an Issuing Lender has made
payment under any Letter of Credit and has received from any L/C Participant its
pro rata share of such payment in accordance with Section 3.4(a), such Issuing
Lender receives any payment related to such Letter of Credit (whether directly
from the Borrower or otherwise, including proceeds of collateral applied thereto
by such Issuing Lender), or any payment of interest on account thereof, such
Issuing Lender will distribute to such L/C Participant its pro rata share
thereof; provided, however, that in the event that any such payment received by
such Issuing Lender shall be required to be returned by such Issuing Lender,
such L/C Participant shall return to such Issuing Lender the portion thereof
previously distributed by such Issuing Lender to it.

                  3.5 Reimbursement Obligation of the Borrower. The Borrower
agrees to reimburse each Issuing Lender, on each date on which such Issuing
Lender notifies the Borrower of the date and amount of a draft presented under
any Letter of Credit and paid by such Issuing Lender, for the amount of (a) such
draft so paid and (b) any taxes, fees, charges or other costs or expenses
incurred by such Issuing Lender in connection with such payment (the amounts
described in the foregoing clauses (a) and (b) in respect of any drawing,
collectively, the "Payment Amount"). Each such payment shall be made to such
Issuing Lender at its address for notices specified herein in lawful money of
the United States of America and in immediately available funds. Interest shall
be payable on each Payment Amount from the date of the applicable drawing until
payment in full at the rate set forth in (i) until the second Business Day
following the date of the applicable drawing, Section 2.10(b) and (ii)
thereafter, Section 2.10(c). Each drawing under any Letter of Credit shall
(unless an event of the type described in clause (i) or (ii) of Section 8(f)
shall have occurred and be continuing with respect to the Borrower, in which
case the procedures specified in Section 3.4 for funding by L/C Participants
shall apply) constitute a request by the Borrower to the Administrative Agent
for a borrowing pursuant to Section 2.2 of Base Rate Loans. The Borrowing Date
with respect to such borrowing shall be the first date on which a borrowing of
Loans could be made, pursuant to Section 2.2, if the Administrative Agent had
received a notice of such borrowing at the time the Administrative Agent
receives notice from the relevant Issuing Lender of such drawing under such
Letter of Credit.

                  3.6 Obligations Absolute. The Borrower's obligations under
this Section 3 shall be absolute and unconditional under any and all
circumstances and irrespective of any setoff, counterclaim or defense to payment
that the Borrower may have or have had against any Issuing Lender, any
beneficiary of a Letter of Credit or any other Person. The Borrower also agrees
with each Issuing Lender that such Issuing Lender shall not be responsible for,
and the Borrower's Reimbursement Obligations under Section 3.5 shall not be
affected by, among other things, the validity or genuineness of documents or of
any endorsements thereon, even though such documents shall in fact prove to be
invalid, fraudulent or forged, or any dispute between or among the Borrower and
any beneficiary of any Letter of Credit or any other party to which such Letter
of Credit may be transferred or any claims whatsoever of the Borrower against
any beneficiary of such Letter of Credit or any such transferee. No Issuing
Lender shall be liable for



                                                                              37

any error, omission, interruption or delay in transmission, dispatch or delivery
of any message or advice, however transmitted, in connection with any Letter of
Credit, except for errors or omissions found by a final and nonappealable
decision of a court of competent jurisdiction to have resulted from the gross
negligence or willful misconduct of such Issuing Lender. The Borrower agrees
that any action taken or omitted by an Issuing Lender under or in connection
with any Letter of Credit issued by it or the related drafts or documents, if
done in the absence of gross negligence or willful misconduct and in accordance
with the standards of care specified in the Uniform Commercial Code of the State
of New York, shall be binding on the Borrower and shall not result in any
liability of such Issuing Lender to the Borrower.

                  3.7 Letter of Credit Payments. If any draft shall be presented
for payment under any Letter of Credit, the relevant Issuing Lender shall
promptly notify the Borrower of the date and amount thereof. The responsibility
of the relevant Issuing Lender to the Borrower in connection with any draft
presented for payment under any Letter of Credit, in addition to any payment
obligation expressly provided for in such Letter of Credit issued by such
Issuing Lender, shall be limited to determining that the documents (including
each draft) delivered under such Letter of Credit in connection with such
presentment appear on their face to be in conformity with such Letter of Credit.

                  3.8 Applications. To the extent that any provision of any
Application related to any Letter of Credit is inconsistent with the provisions
of this Section 3, the provisions of this Section 3 shall apply.

                   SECTION 4. REPRESENTATIONS AND WARRANTIES

                  To induce the Agents and the Lenders to enter into this
Agreement and to make the Loans and issue or participate in the Letters of
Credit, Holdings and the Borrower hereby jointly and severally represent and
warrant to each Agent and each Lender that:

                  4.1 Financial Condition. (a) The unaudited pro forma
consolidated balance sheet of the Borrower and its consolidated Subsidiaries as
at March 31, 2002 (including the notes thereto) (the "Pro Forma Balance Sheet"),
copies of which have heretofore been furnished to each Lender, has been prepared
giving effect (as if such events had occurred on such date) to (i) the Loans to
be made and the Senior Notes to be issued on the Closing Date and the use of
proceeds thereof and (ii) the payment of fees and expenses in connection with
the foregoing. The Pro Forma Balance Sheet has been prepared based on the best
information available to the Borrower as of the date of delivery thereof, and
presents fairly on a pro forma basis the estimated financial position of
Borrower and its consolidated Subsidiaries as at March 31, 2002, assuming that
the events specified in the preceding sentence had actually occurred at such
date.

                  (b) The audited consolidated balance sheets of the Borrower as
at December 31, 2000 and December 31, 2001, and the related consolidated
statements of income and of cash flows for the fiscal years ended on such dates,
reported on by and accompanied by an unqualified report from KPMG LLP, present
fairly the consolidated financial condition of the Borrower as at such date, and
the consolidated results of its operations and its consolidated cash flows for
the respective fiscal years then ended. The unaudited consolidated balance sheet
of the Borrower as at March 31, 2002, and the related unaudited consolidated
statements of income and cash flows



                                                                              38

for the three-month period ended on such date, present fairly the consolidated
financial condition of the Borrower as at such date, and the consolidated
results of its operations and its consolidated cash flows for the three-month
period then ended (subject to normal year-end audit adjustments). All such
financial statements, including the related schedules and notes thereto, have
been prepared in accordance with GAAP applied consistently throughout the
periods involved (except as approved by the aforementioned firm of accountants
and disclosed therein). The Borrower and its Subsidiaries do not have any
material Guarantee Obligations, contingent liabilities and liabilities for
taxes, or any long-term leases or unusual forward or long-term commitments,
including, without limitation, any interest rate or foreign currency swap or
exchange transaction or other obligation in respect of derivatives, that are not
reflected in the most recent financial statements referred to in this paragraph.
During the period from December 31, 2001 to and including the date hereof there
has been no Disposition by the Borrower of any material part of its business or
Property.

                  4.2 No Change. Since December 31, 2001 there has been no
development or event that has had or could reasonably be expected to have a
Material Adverse Effect.

                  4.3 Corporate Existence; Compliance with Law. Each of
Holdings, the Borrower and its Subsidiaries (a) is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization, (b) has the corporate power and authority, and the legal right, to
own and operate its Property, to lease the Property it operates as lessee and to
conduct the business in which it is currently engaged, (c) is duly qualified as
a foreign corporation and in good standing under the laws of each jurisdiction
where its ownership, lease or operation of Property or the conduct of its
business requires such qualification and (d) is in compliance with all
Requirements of Law except to the extent that the failure to comply therewith
could not, in the aggregate, reasonably be expected to have a Material Adverse
Effect.

                  4.4 Corporate Power; Authorization; Enforceable Obligations.
Each Loan Party has the corporate power and authority, and the legal right, to
make, deliver and perform the Loan Documents to which it is a party and, in the
case of the Borrower, to borrow hereunder. Each Loan Party has taken all
necessary corporate or other action to authorize the execution, delivery and
performance of the Loan Documents to which it is a party and, in the case of the
Borrower, to authorize the borrowings on the terms and conditions of this
Agreement. No consent or authorization of, filing with, notice to or other act
by or in respect of, any Governmental Authority or any other Person is required
in connection with the Acquisition, the borrowings hereunder or the execution,
delivery, performance, validity or enforceability of this Agreement or any of
the other Loan Documents, except (i) consents, authorizations, filings and
notices described in Schedule 4.4, which consents, authorizations, filings and
notices have been obtained or made and are in full force and effect and (ii) the
filings referred to in Section 4.21. Each Loan Document has been duly executed
and delivered on behalf of each Loan Party that is a party thereto. This
Agreement constitutes, and each other Loan Document upon execution will
constitute, a legal, valid and binding obligation of each Loan Party that is a
party thereto, enforceable against each such Loan Party in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement
of creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).



                                                                              39

                  4.5 No Legal Bar. The execution, delivery and performance of
this Agreement and the other Loan Documents, the issuance of Letters of Credit,
the borrowings hereunder and the use of the proceeds thereof will not violate
any Requirement of Law or any Contractual Obligation of Holdings, the Borrower
or any of its Subsidiaries and will not result in, or require, the creation or
imposition of any Lien on any of their respective properties or revenues
pursuant to any Requirement of Law or any such Contractual Obligation (other
than the Liens created by the Security Documents). No Requirement of Law or
Contractual Obligation applicable to the Borrower or any of its Subsidiaries
could reasonably be expected to have a Material Adverse Effect.

                  4.6 No Material Litigation. No litigation, investigation or
proceeding of or before any arbitrator or Governmental Authority is pending or,
to the knowledge of Holdings or the Borrower, threatened by or against Holdings,
the Borrower or any of its Subsidiaries or against any of their respective
properties or revenues (a) with respect to any of the Loan Documents or any of
the transactions contemplated hereby or thereby, or (b) that could reasonably be
expected to have a Material Adverse Effect.

                  4.7 No Default. Neither Holdings, the Borrower nor any of its
Subsidiaries is in default under or with respect to any of its Contractual
Obligations in any respect that could reasonably be expected to have a Material
Adverse Effect. No Default or Event of Default has occurred and is continuing.

                  4.8 Ownership of Property; Liens. Each of Holdings, the
Borrower and its Subsidiaries has title in fee simple to, or a valid leasehold
interest in, all its real property, and good title to, or a valid leasehold
interest in, all its other Property, and none of such Property is subject to any
Lien except as permitted by Section 7.3.

                  4.9 Intellectual Property. Holdings, the Borrower and each of
its Subsidiaries owns, or is licensed to use, all Intellectual Property
necessary for the conduct of its business as currently conducted. No material
claim has been asserted and is pending by any Person challenging or questioning
the use of any Intellectual Property or the validity or effectiveness of any
Intellectual Property, nor does Holdings or the Borrower know of any valid basis
for any such claim. The use of Intellectual Property by Holdings, the Borrower
and its Subsidiaries does not infringe on the rights of any Person in any
material respect.

                  4.10 Taxes. Each of Holdings, the Borrower and each of its
Subsidiaries has filed or caused to be filed all Federal, state and other
material tax returns that are required to be filed and has paid all taxes shown
to be due and payable on said returns or on any assessments made against it or
any of its Property and all other taxes, fees or other charges imposed on it or
any of its Property by any Governmental Authority (other than any the amount or
validity of which are currently being contested in good faith by appropriate
proceedings and with respect to which reserves in conformity with GAAP have been
provided on the books of Holdings, the Borrower or its Subsidiaries, as the case
may be); and no tax Lien has been filed, and, to the knowledge of Holdings and
the Borrower, no claim is being asserted, with respect to any such tax, fee or
other charge.



                                                                              40

                  4.11 Federal Regulations. No part of the proceeds of any Loans
will be used for "purchasing" or "carrying" any "margin stock" within the
respective meanings of each of the quoted terms under Regulation U as now and
from time to time hereafter in effect or for any purpose that violates the
provisions of the Regulations of the Board. If requested by any Lender or the
Administrative Agent, the Borrower will furnish to the Administrative Agent and
each Lender a statement to the foregoing effect in conformity with the
requirements of FR Form G-3 or FR Form U-1 referred to in Regulation U.

                  4.12 Labor Matters. There are no strikes or other labor
disputes against Holdings, the Borrower or any of its Subsidiaries pending or,
to the knowledge of Holdings or the Borrower, threatened that (individually or
in the aggregate) could reasonably be expected to have a Material Adverse
Effect. Hours worked by and payment made to employees of Holdings, the Borrower
and its Subsidiaries have not been in violation of the Fair Labor Standards Act
or any other applicable Requirement of Law dealing with such matters that
(individually or in the aggregate) could reasonably be expected to have a
Material Adverse Effect. All payments due from Holdings, the Borrower or any of
its Subsidiaries on account of employee health and welfare insurance that
(individually or in the aggregate) could reasonably be expected to have a
Material Adverse Effect if not paid have been paid or accrued as a liability on
the books of Holdings, the Borrower or the relevant Subsidiary.

                  4.13 ERISA. Neither a Reportable Event nor an "accumulated
funding deficiency" (within the meaning of Section 412 of the Code or Section
302 of ERISA) has occurred during the five-year period prior to the date on
which this representation is made or deemed made with respect to any Plan, and
each Plan has complied in all material respects with the applicable provisions
of ERISA and the Code. No termination of a Single Employer Plan has occurred,
and no Lien in favor of the PBGC or a Plan has arisen, during such five-year
period. The present value of all accrued benefits under each Single Employer
Plan (based on those assumptions used to fund such Plans) did not, as of the
last annual valuation date prior to the date on which this representation is
made or deemed made, exceed the value of the assets of such Plan allocable to
such accrued benefits by a material amount. Neither the Borrower nor any
Commonly Controlled Entity has had a complete or partial withdrawal from any
Multiemployer Plan that has resulted or could reasonably be expected to result
in a material liability under ERISA, and neither the Borrower nor any Commonly
Controlled Entity would become subject to any material liability under ERISA if
the Borrower or any such Commonly Controlled Entity were to withdraw completely
from all Multiemployer Plans as of the valuation date most closely preceding the
date on which this representation is made or deemed made. No such Multiemployer
Plan is in Reorganization or Insolvent.

                  4.14 Investment Company Act; Other Regulations. No Loan Party
is an "investment company", or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as amended.
No Loan Party is subject to regulation under any Requirement of Law (other than
Regulation X of the Board) which limits its ability to incur Indebtedness under
this Agreement and the other Loan Documents.

                  4.15 Material Subsidiaries. (a) The Subsidiaries listed on
Schedule 4.15 constitute all the Material Subsidiaries of the Borrower at the
date hereof. Schedule 4.15 sets forth as of the Closing Date the name and
jurisdiction of incorporation of each Material



                                                                              41

Subsidiary and, as to each Material Subsidiary, the percentage of each class of
Capital Stock owned by each Loan Party.

                  (b) As of the Closing Date, there are no outstanding
subscriptions, options, warrants, calls, rights or other agreements or
commitments (other than stock options granted to employees or directors and
directors' qualifying shares) of any nature relating to any Capital Stock of
Holdings, the Borrower or any Subsidiary, except as disclosed on Schedule 4.15.

                  4.16 Use of Proceeds. The proceeds of the Loans, and the
Letters of Credit, shall be used for working capital needs and general corporate
purposes of the Borrower and its Subsidiaries.

                  4.17 Environmental Matters. Other than exceptions to any of
the following that could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect:

                  (a) The Borrower and its Subsidiaries: (i) are, and within the
period of all applicable statutes of limitation have been, in compliance with
all applicable Environmental Laws; (ii) hold all Environmental Permits (each of
which is in full force and effect) required for any of their current or intended
operations or for any property owned, leased, or otherwise operated by any of
them; (iii) are, and within the period of all applicable statutes of limitation
have been, in compliance with all of their Environmental Permits; and (iv)
reasonably believe that: each of their Environmental Permits will be timely
renewed and complied with, without material expense; any additional
Environmental Permits that may be required of any of them will be timely
obtained and complied with, without material expense; and compliance with any
Environmental Law that is or is expected to become applicable to any of them
will be timely attained and maintained, without material expense.

                  (b) Materials of Environmental Concern are not present at, on,
under, in, or about any real property now or formerly owned, leased or operated
by the Borrower or any of its Subsidiaries, or at any other location (including,
without limitation, any location to which Materials of Environmental Concern
have been sent for re-use or recycling or for treatment, storage, or disposal)
which could reasonably be expected to (i) give rise to liability of the Borrower
or any of its Subsidiaries under any applicable Environmental Law or otherwise
result in costs to the Borrower or any of its Subsidiaries, or (ii) interfere
with the Borrower's or any of its Subsidiaries' continued operations, or (iii)
impair the fair saleable value of any real property owned or leased by the
Borrower or any of its Subsidiaries.

                  (c) There is no judicial, administrative, or arbitral
proceeding (including any notice of violation or alleged violation) under or
relating to any Environmental Law to which the Borrower or any of its
Subsidiaries is, or to the knowledge of the Borrower or any of its Subsidiaries
will be, named as a party that is pending or, to the knowledge of the Borrower
or any of its Subsidiaries, threatened.

                  (d) Neither the Borrower nor any of its Subsidiaries has
received any written request for information, or been notified that it is a
potentially responsible party under or relating



                                                                              42

to the federal Comprehensive Environmental Response, Compensation, and Liability
Act or any similar Environmental Law, or with respect to any Materials of
Environmental Concern.

                  (e) Neither the Borrower nor any of its Subsidiaries has
entered into or agreed to any consent decree, order, or settlement or other
agreement, or is subject to any judgment, decree, or order or other agreement,
in any judicial, administrative, arbitral, or other forum for dispute
resolution, relating to compliance with or liability under any Environmental
Law.

                  (f) Neither the Borrower nor any of its Subsidiaries has
assumed or retained, by contract or operation of law, any liabilities of any
kind, fixed or contingent, known or unknown, under any Environmental Law or with
respect to any Material of Environmental Concern.

                  4.18 Compliance With Health Care Laws. Without limiting the
generality of Section 4.3(c) or any other representation or warranty made
herein, to the Borrower's knowledge, the healthcare facilities operated by the
Borrower and its Subsidiaries, and each of its licensed employees in the
exercise of their respective duties on behalf of such facilities, is in
compliance with all applicable statutes, laws, ordinances, rules and regulations
of any governmental authority with respect to regulatory matters primarily
relating to patient healthcare (including without limitation Section 1128B(b) of
the Social Security Act, as amended, 42 U.S.C. Section 1320a-7(b) (Criminal
Penalties Involving Medicare or State Health Care Programs), commonly referred
to as the "Federal Anti-Kickback Statute," and the Social Security Act, as
amended, Section 1877, 42 U.S.C Section 1395nn (Prohibition Against Certain
Referrals), commonly referred to as "Stark Statute") except to the extent that
the failure to comply therewith could not, in the aggregate, reasonably be
expected to have a Material Adverse Effect. The Borrower and each of its
Subsidiaries has maintained in all material respects all records required to be
maintained by the Joint Commission on Accreditation of Healthcare Organizations,
the Food and Drug Administration, Drug Enforcement Agency and State Boards of
Pharmacy and the federal and state Medicare and Medicaid programs as required by
the Healthcare Laws and, to the knowledge of the Borrower, there are no
presently existing circumstances or violations of Healthcare Laws which are, in
the aggregate, reasonably likely to result in a Material Adverse Effect. The
Borrower and its Subsidiaries and the owners of the facilities and other
businesses managed by the Borrower or its Subsidiaries have such permits,
licenses, franchises, certificates and other approvals or authorizations of
governmental or regulatory authorities as are necessary under applicable law to
own their respective properties and to conduct their respective business
(including without limitation such permits as are required under such federal,
state and other health care laws, and under such HMO or similar licensure laws
and such insurance laws and regulations, as are applicable thereto) except to
the extent that the failure to obtain or possess such approvals or
authorizations could not, in the aggregate, reasonably be expected to have a
Material Adverse Effect.

                  4.19 HIPAA Compliance. To the extent that and for so long as
the Borrower is a "covered entity" within the meaning of HIPAA, the Borrower (i)
has undertaken or will promptly undertake all necessary surveys, audits,
inventories, reviews, analyses and/or assessments (including any necessary risk
assessments) of all areas of its business and operations required by HIPAA
and/or that could be adversely affected by the failure of the Borrower to be
HIPAA Compliant (as defined below); (ii) has developed or will promptly develop
a detailed


                                                                              43

plan and time line for becoming HIPAA Compliant (a "HIPAA Compliance Plan"); and
(iii) has implemented or will implement those provisions of such HIPAA
Compliance Plan in all material respects necessary to ensure that the Borrower
is or becomes HIPAA Compliant. For purposes hereof, "HIPAA Compliant" shall mean
that the Borrower (x) is or will be in compliance with each of the applicable
requirements of the so-called "Administrative Simplification" provisions of
HIPAA on and as of each date that any part thereof, or any final rule or
regulation thereunder, becomes effective in accordance with its or their terms,
as the case may be (each such date, a "HIPAA Compliance Date") and (y) is not
and could not reasonably be expected to become, as of any date following any
such HIPAA Compliance Date, the subject of any civil or criminal penalty,
process, claim, action or proceeding, or any administrative or other regulatory
review, survey, process or proceeding (other than routine surveys or reviews
conducted by any government health plan or other accreditation entity) that
could reasonably be expected to have a Material Adverse Effect.

                  4.20 Accuracy of Information, etc. No statement or information
contained in this Agreement, any other Loan Document, the Confidential
Information Memorandum or any other document, certificate or statement furnished
to the Administrative Agent or the Lenders or any of them, by or on behalf of
any Loan Party for use in connection with the transactions contemplated by this
Agreement or the other Loan Documents, contained as of the date such statement,
information, document or certificate was so furnished (or, in the case of the
Confidential Information Memorandum, as of the date of this Agreement), any
untrue statement of a material fact or omitted to state a material fact
necessary in order to make the statements contained herein or therein not
misleading. The projections and pro forma financial information contained in the
materials referenced above are based upon good faith estimates and assumptions
believed by management of the Borrower to be reasonable at the time made, it
being recognized by the Lenders that such financial information as it relates to
future events is not to be viewed as fact and that actual results during the
period or periods covered by such financial information may differ from the
projected results set forth therein by a material amount. There is no fact known
to any Loan Party that could reasonably be expected to have a Material Adverse
Effect that has not been expressly disclosed herein, in the other Loan
Documents, in the Confidential Information Memorandum or in any other documents,
certificates and statements furnished to the Agents and the Lenders for use in
connection with the transactions contemplated hereby and by the other Loan
Documents.

                  4.21 Security Documents. (a) The Guarantee and Collateral
Agreement is effective to create in favor of the Administrative Agent, for the
benefit of the Secured Parties, a legal, valid and enforceable security interest
in the Collateral described therein and proceeds thereof. In the case of the
Pledged Stock described in the Guarantee and Collateral Agreement, when any
stock certificates representing such Pledged Stock are delivered to the
Administrative Agent, and in the case of the other Collateral described in the
Guarantee and Collateral Agreement, when financing statements in appropriate
form are filed in the offices specified on Schedule 4.21(a)-1 (which financing
statements have been duly completed and delivered to the Administrative Agent
for filing) and such other filings as are specified on Schedule 3 to the
Guarantee and Collateral Agreement have been completed (all of which filings
have been duly completed), the Guarantee and Collateral Agreement shall
constitute a fully perfected Lien on, and security interest in, all right, title
and interest of the Loan Parties in such Collateral and the proceeds thereof, as
security for the Obligations (as defined in the Guarantee and Collateral




                                                                              44

Agreement), in each case prior and superior in right to any other Person
(except, in the case of Collateral other than Pledged Stock, Liens permitted by
Section 7.3). Schedule 4.21(a)-2 lists each UCC Financing Statement that names
any Loan Party as debtor and will remain on file after the Closing Date other
than Financing Statements which name the Existing Agent as a secured party and
will be assigned to the Administrative Agent or terminated as soon as is
practicable following the Closing Date. Schedule 4.21(a)-3 lists each UCC
Financing Statement that (i) names any Loan Party as debtor and will be
terminated on or prior to the Closing Date or (ii) names any Inactive Subsidiary
as a debtor and will be terminated as soon as is practicable following the
Closing Date; and on or prior to the Closing Date, the Borrower will have
delivered to the Administrative Agent, or caused to be filed, duly completed UCC
termination statements in respect of each UCC Financing Statement listed in
Schedule 4.21(a)-3.

                  (b) Each of the Mortgages, as amended by the relevant Mortgage
Amendment, is effective to create in favor of the Administrative Agent, for the
benefit of the Secured Parties, a legally valid and enforceable Lien on the
Mortgaged Properties described therein and proceeds thereof, and when the
Mortgage Amendments are filed in the offices set forth in Schedule 4.21(b), each
Mortgage (as amended by such Mortgage Amendment) shall continue to constitute a
fully perfected Lien on, and security interest in, all right, title and interest
of the Loan Parties in the Mortgaged Properties and the proceeds thereof, as
security for the Obligations (as defined in the relevant Mortgage), in each case
prior and superior in right to any other Person (other than Persons holding
Liens or other encumbrances or rights permitted by the relevant Mortgage).

                  4.22 Solvency. Each Loan Party is, and after giving effect to
the transactions contemplated hereby and the incurrence of all Indebtedness and
obligations being incurred in connection herewith and therewith will be and will
continue to be, Solvent.

                  4.23 Senior Indebtedness. The Obligations constitute "Senior
Indebtedness" of the Borrower under and as defined in the Senior Subordinated
Note Indenture. The obligations of each Subsidiary Guarantor under the Guarantee
and Collateral Agreement constitute "Guarantor Senior Indebtedness" of such
Subsidiary Guarantor under and as defined in the Senior Subordinated Note
Indenture.

                  4.24 Regulation H. No Mortgage encumbers improved real
property which is located in an area that has been identified by the Secretary
of Housing and Urban Development as an area having special flood hazards and in
which flood insurance has been made available under the National Flood Insurance
Act of 1968 (except any Mortgaged Properties as to which such flood insurance as
required by Regulation H has been obtained and is in full force and effect as
required by this Agreement).

                  4.25 Deposit Accounts and Securities Accounts. Schedule 4.25
lists all Deposit Accounts and Securities Accounts in existence on the Closing
Date, after giving effect to the transactions to be effected on the Closing
Date.

                  4.26 Reimbursement From Third Party Payors. Each of the
Borrower and its Subsidiaries is in compliance with the written material
reimbursement policies, rules and regulations of third party payors such as
Medicare, Medicaid, private insurance companies,




                                                                              45

health maintenance organizations, preferred provider organizations, managed care
systems and other third party payors, including, without limitation, adjustments
under any capitation arrangement, fee schedule, discount formula or cost-based
reimbursement the failure to comply with which would be reasonably likely to
have a Material Adverse Effect.

                  4.27 Fraud and Abuse. Neither the Borrower nor any Subsidiary,
nor any stockholder, officer or director, acting on behalf of the Borrower or
any Subsidiary, has engaged on behalf of the Borrower or any Subsidiary in any
of the following, except where there would likely be no Material Adverse Effect:
(i) knowing and willfully making or causing to be made a false statement or
representation of a material fact in any applications for any benefit or payment
under Medicare or Medicaid programs; (ii) knowing and willfully making or
causing to be made any false statement or representation of a material fact for
use in determining rights to any benefit or payment under Medicare or Medicaid
programs; (iii) any knowing and willful failure by the Borrower or any
Subsidiary to disclose to the appropriate government contractor any material
overpayment or other improper payment received from the Medicare and Medicaid
program; or (iv) any knowing and willful violation of the Federal and State
anti-kick-back or fraud and abuse laws, the regulations promulgated thereunder.

                  4.28 Inactive Subsidiaries. None of the Inactive Subsidiaries
(i) is engaged in any material business operations, (ii) holds any material
assets or (iii) guarantees, or otherwise provides direct credit support
(including a Lien on its assets) for, Indebtedness of the Borrower or any of its
Subsidiaries.


                        SECTION 5. CONDITIONS PRECEDENT

                  5.1 Conditions to Closing Date and Initial Extension of
Credit. The occurrence of the Closing Date and the agreement of each Lender to
make the initial extension of credit requested to be made by it hereunder are
subject to the satisfaction of the following conditions precedent:

                  (a) Loan Documents. The Administrative Agent shall have
received (i) this Agreement, executed and delivered by a duly authorized officer
of Holdings and the Borrower, (ii) the Guarantee and Collateral Agreement,
executed and delivered by a duly authorized officer of Holdings, the Borrower
and each Subsidiary Guarantor, (iii) a Control Agreement in respect of each
Deposit Account (other than deposit accounts (i) having a balance of less than
$100,000 as of May 31, 2002 or (ii) into which proceeds of Medicare or Medicaid
Receivables (as defined in the Guarantee and Collateral Agreement) are directly
deposited by the obligor thereof) and Securities Account, executed and delivered
by the Loan Party that is the holder of such Deposit Account or Securities
Account and the bank or securities intermediary at which such Deposit Account or
Securities Account is maintained, (iv) a Lender Addendum executed and delivered
by each Lender and accepted by the Borrower and (v) the Payoff Letter executed
and delivered by the Existing Agent, Borrower and Holdings.

                  (b) Pre-Closing Transactions. The following shall have
occurred:



                                                                              46


                      (i)  the Borrower shall have received at least
                           $150,000,000 in gross cash proceeds from the issuance
                           of the Senior Notes; and

                      (ii) the transactions described in the fourth, fifth and
                           sixth recitals to this Agreement shall have been
                           consummated.

                  (c) Pro Forma Balance Sheet; Financial Statements. The Lenders
shall have received, in each case in form and substance satisfactory to the
Lenders, (i) the Pro Forma Balance Sheet, (ii) audited consolidated financial
statements of the Borrower for the 2000 and 2001 fiscal years and (iii)
unaudited interim consolidated financial statements of the Borrower for each
fiscal quarterly period ended subsequent to the date of the latest applicable
financial statements delivered pursuant to clause (ii) of this paragraph as to
which such financial statements are available.

                  (d) Approvals. All governmental and third party approvals
necessary in connection with the continuing operations of Holdings, the Borrower
and its Subsidiaries and the transactions contemplated hereby shall have been
obtained and be in full force and effect.

                  (e) Related Agreements. The Administrative Agent shall have
received (in a form reasonably satisfactory to the Administrative Agent), true
and correct copies, certified as to authenticity by the Borrower, of (i) the
Senior Subordinated Note Indenture, (ii) the Senior Note Indenture and (iii)
such other documents or instruments as may be reasonably requested by the
Administrative Agent, including, without limitation, a copy of any other debt
instrument, security agreement or other material contract to which the Loan
Parties may be a party.

                  (f) Fees. The Lenders and the Administrative Agent shall have
received all fees required to be paid, and all expenses for which invoices have
been presented (including reasonable fees, disbursements and other charges of
counsel to the Agents), on or before the Closing Date. All such amounts will be
paid with proceeds of Loans made on the Closing Date and will be reflected in
the funding instructions given by the Borrower to the Administrative Agent on or
before the Closing Date.

                  (g) Business Plan. The Lenders shall have received a
satisfactory business plan for fiscal years 2002-2006 and a satisfactory written
analysis of the business and prospects of the Borrower and its Subsidiaries for
the period from the Closing Date through 2006.

                  (h) Lien Searches. The Administrative Agent and each
requesting Lender shall have received the results of a recent lien search with
respect to each Loan Party (i) in the state of incorporation or formation of
such Loan Party, (ii) in the state in which the chief executive office of such
Loan Party is located, (iii) in each state in which such Loan Party is
authorized to conduct business and (iv) in any other jurisdiction in which
Uniform Commercial Code financing statement or other filings or recordations
should be made to evidence or perfect security interests in all material assets
of the Loan Party (excluding real properties which are not, and fixtures not
relating to, Mortgaged Properties), and such search shall reveal no liens on any
of the assets of the Loan Parties, except for Liens permitted by Section 7.3.




                                                                              47


                  (i) Environmental Matters. The Administrative Agent shall have
received, with a copy for each Lender, completed environmental questionnaires
prepared internally with respect to each of the Mortgaged Properties.

                  (j) Closing Certificate. The Administrative Agent shall have
received a certificate of each Loan Party, dated the Closing Date, in form
reasonably satisfactory to the Administrative Agent and containing the
representations and items included in Exhibit C, with appropriate insertions and
attachments.

                  (k) Legal Opinions. The Administrative Agent and requesting
Lenders shall have received the following executed legal opinions:

                      (i)  the legal opinion of Foley & Lardner, counsel to
                           Holdings, the Borrower and its Subsidiaries,
                           substantially in the form of Exhibit F; and

                      (ii) the legal opinion of local counsel in each of
                           Arkansas, Delaware, Indiana, Kentucky, Minnesota,
                           Ohio, West Virginia, Pennsylvania, Wisconsin and of
                           such other special and local counsel as may be
                           required by the Administrative Agent.

Each such legal opinion shall cover such other matters incident to the
transactions contemplated by this Agreement as the Administrative Agent may
reasonably require.

                  (l) Pledged Stock; Stock Powers; Acknowledgment and Consent;
Pledged Notes. The Administrative Agent shall have received (i) the certificates
representing the shares of Capital Stock pledged pursuant to the Guarantee and
Collateral Agreement, together with an undated stock power for each such
certificate executed in blank by a duly authorized officer of the pledgor
thereof, (ii) an Acknowledgment and Consent, substantially in the form of Annex
II to the Guarantee and Collateral Agreement, duly executed by any issuer of
Capital Stock pledged pursuant to the Guarantee and Collateral Agreement that is
not itself a party to the Guarantee and Collateral Agreement and (iii) each
promissory note pledged pursuant to the Guarantee and Collateral Agreement
endorsed (without recourse) in blank (or accompanied by an executed transfer
form in blank satisfactory to the Administrative Agent) by the pledgor thereof.

                  (m) Existing Mortgages; Existing Mortgagee Title Insurance
Policies. The Administrative Agent shall have received satisfactory evidence
that, after giving effect to the transactions contemplated by the recitals to
this Agreement to occur on or prior to the Closing Date, each Existing Mortgage,
as amended by the relevant Mortgage Amendment, will continue to secure the
Obligations to the same extent, and with the same priority, as such Existing
Mortgage secured the obligations of the Borrower and its Affiliates under the
Existing Credit Agreement. The Administrative Agent shall have received in
respect of each of the Existing Mortgagee Title Policies an endorsement from the
issuing title insurance company which shall (i) insure that the Mortgage insured
thereby (as amended) shall continue to be a valid first Lien on the Mortgaged
Property encumbered thereby as of the effective date of such Existing Mortgagee
Title Policy, to the same extent and with the same priority as such Existing
Mortgagee Title Policy insured the Existing Mortgage; (ii) name the
Administrative Agent for




                                                                              48

the benefit of the Secured Parties as the insured thereunder; and (iii) be in
form and substance reasonably satisfactory to the Administrative Agent.

                  (n) Filings, Registrations and Recordings. Each document
(including, without limitation, any Uniform Commercial Code financing statement)
required by the Security Documents or under law or reasonably requested by the
Administrative Agent to be filed, registered or recorded in order to reflect the
assignment of Liens from the Existing Agent to the Administrative Agent or the
creation in favor of the Administrative Agent, for the benefit of the Secured
Parties, of a perfected Lien on the Collateral described therein, prior and
superior in right to any other Person (other than with respect to Liens
expressly permitted by Section 7.3), shall have been filed, registered or
recorded or shall have been delivered to the Administrative Agent in proper form
for filing, registration or recordation.

                  (o) If requested by the Administrative Agent, the
Administrative Agent shall have received (A) a policy of flood insurance that
(1) covers any parcel of improved real property that is encumbered by any
Mortgage (2) is written in an amount not less than the outstanding principal
amount of the indebtedness secured by such Mortgage that is reasonably allocable
to such real property or the maximum limit of coverage made available with
respect to the particular type of property under the National Flood Insurance
Act of 1968, whichever is less, and (3) will remain in force until the maturity
of the indebtedness secured by such Mortgage and (B) confirmation that the
Borrower has received the notice required pursuant to Section 208(e)(3) of
Regulation H of the Board.

                  (p) Insurance. The Administrative Agent shall have received
insurance certificates satisfying the requirements of Section 5.3 of the
Guarantee and Collateral Agreement.

                  5.2 Conditions to Each Extension of Credit. The agreement of
each Lender to make any extension of credit requested to be made by it hereunder
on any date (including, without limitation, its initial extension of credit) is
subject to the satisfaction of the following conditions precedent:

                  (a) Representations and Warranties. Each of the
representations and warranties made by any Loan Party in or pursuant to the Loan
Documents shall be true and correct on and as of such date as if made on and as
of such date.

                  (b) No Default. No Default or Event of Default shall have
occurred and be continuing on such date or after giving effect to the extensions
of credit requested to be made on such date.

                  Each borrowing by and issuance of a Letter of Credit on behalf
of the Borrower hereunder shall constitute a representation and warranty by the
Borrower as of the date of such extension of credit that the conditions
contained in this Section 5.2 have been satisfied.

                        SECTION 6. AFFIRMATIVE COVENANTS

                  Holdings and the Borrower hereby jointly and severally agree
that, so long as the Commitments remain in effect, any Letter of Credit remains
outstanding or any Loan or other





                                                                              49


amount is owing to any Lender or any Agent hereunder, each of Holdings and the
Borrower shall and shall cause each of its Subsidiaries to:

                  6.1 Financial Statements. Furnish to each Agent and each
Lender:

                  (a) as soon as available, but in any event within 90 days
after the end of each fiscal year of the Borrower, a copy of the audited
consolidated balance sheet of the Borrower and its consolidated Subsidiaries as
at the end of such year and the related audited consolidated statements of
income and of cash flows for such year, setting forth in each case in
comparative form the figures as of the end of and for the previous year,
reported on without a "going concern" or like qualification or exception, or
qualification arising out of the scope of the audit, by KPMG LLP or other
independent certified public accountants of nationally recognized standing; and

                  (b) as soon as available, but in any event not later than 45
days after the end of each of the first three quarterly periods of each fiscal
year of the Borrower, the unaudited consolidated balance sheet of the Borrower
and its consolidated Subsidiaries as at the end of such quarter and the related
unaudited consolidated statements of income and of cash flows for such quarter
and the portion of the fiscal year through the end of such quarter, setting
forth in each case in comparative form the figures as of the end of and for the
corresponding period in the previous year, certified by a Responsible Officer as
being fairly stated in all material respects (subject to normal year-end audit
adjustments);

all such financial statements to be complete and correct in all material
respects and to be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods (except as approved by such accountants or officer, as the case may be,
and disclosed therein).

                  6.2 Certificates; Other Information. Furnish to each Agent and
each Lender, or, in the case of clause (h), to the relevant Lender:

                  (a) concurrently with the delivery of the financial statements
referred to in Section 6.1(a), a certificate of the independent certified public
accountants reporting on such financial statements stating that in making the
examination necessary therefor no knowledge was obtained of any Default or Event
of Default, except as specified in such certificate (it being understood that
such certificate shall be limited to the items that independent certified public
accountants are permitted to cover in such certificates pursuant to their
professional standards and customs of the profession);

                  (b) concurrently with the delivery of any financial statements
pursuant to Section 6.1, (i) a certificate of a Responsible Officer stating
that, to the best of such Responsible Officer's knowledge, each Loan Party
during such period has observed or performed all of its covenants and other
agreements, and satisfied every condition, contained in this Agreement and the
other Loan Documents to which it is a party to be observed, performed or
satisfied by it, and that such Responsible Officer has obtained no knowledge of
any Default or Event of Default except as specified in such certificate and (ii)
in the case of quarterly or annual financial statements, (x) a Compliance
Certificate containing all information and calculations necessary



                                                                              50


for determining compliance by Holdings, the Borrower and its Subsidiaries with
the provisions of this Agreement referred to therein as of the last day of the
fiscal quarter or fiscal year of the Borrower, as the case may be, (y) a list of
any Intellectual Property acquired by any Loan Party since the date of the most
recent list delivered pursuant to this clause (y) (or, in the case of the first
such list so delivered, since the Closing Date) and (z) a list of any UCC
financing statements or other filings specified in such Compliance Certificate
as being required to be delivered therewith;

                  (c) as soon as available, and in any event no later than 45
days after the end of each fiscal year of the Borrower, a detailed consolidated
budget for the following fiscal year (including a projected consolidated balance
sheet of the Borrower and its Subsidiaries as of the end of the following fiscal
year, and the related consolidated statements of projected cash flow, projected
changes in financial position and projected income), and, as soon as available,
significant revisions, if any, of such budget and projections with respect to
such fiscal year (collectively, the "Projections"), which Projections shall in
each case be accompanied by a certificate of a Responsible Officer stating that
such Projections are based on reasonable estimates, information and assumptions
and that such Responsible Officer has no reason to believe that such Projections
are incorrect or misleading in any material respect;

                  (d) within 45 days after the end of each fiscal quarter of the
Borrower, a narrative discussion and analysis of the financial condition and
results of operations of the Borrower and its Subsidiaries for such fiscal
quarter and for the period from the beginning of the then current fiscal year to
the end of such fiscal quarter, as compared to the portion of the Projections
covering such periods and to the comparable periods of the previous year;

                  (e) no later than 10 Business Days prior to the effectiveness
thereof, copies of substantially final drafts of any proposed amendment,
supplement, waiver or other modification with respect to the Senior Subordinated
Note Indenture or the Senior Note Indenture;

                  (f) within five days after the same are sent, copies of all
financial statements and reports that Holdings or the Borrower sends to the
holders of any class of its debt securities or public equity securities and,
within five days after the same are filed, copies of all financial statements
and reports that Holdings or the Borrower may make to, or file with, the SEC;

                  (g) as soon as possible and in any event within 10 days of
obtaining knowledge thereof: (i) any development, event, or condition that,
individually or in the aggregate with other developments, events or conditions,
could reasonably be expected to result in the payment by the Borrower and its
Subsidiaries, in the aggregate, of a Material Environmental Amount; and (ii) any
notice that any governmental authority may deny any application for an
Environmental Permit sought by, or revoke or refuse to renew any Environmental
Permit held by, the Borrower; and

                  (h) promptly, such additional financial and other information
as any Lender may from time to time reasonably request.

                  6.3 Payment of Obligations and Compliance with Agreements.
Pay, discharge or otherwise satisfy at or before maturity or before they become
delinquent, as the case may be,



                                                                              51


all its material obligations of whatever nature, except where the amount or
validity thereof is currently being contested in good faith by appropriate
proceedings and reserves in conformity with GAAP with respect thereto have been
provided on the books of Holdings, the Borrower or its Subsidiaries, as the case
may be; and comply with its obligations under the other Loan Documents and the
Fee Letter.

                  6.4 Conduct of Business and Maintenance of Existence, etc. (a)
(i) Preserve, renew and keep in full force and effect its corporate or other
existence and (ii) take all reasonable action to maintain all rights, privileges
and franchises necessary or desirable in the normal conduct of its business,
except, in each case, as otherwise permitted by Section 7.4 and except, in the
case of clause (ii) above, to the extent that failure to do so could not
reasonably be expected to have a Material Adverse Effect; and (b) comply with
all Contractual Obligations and Requirements of Law, except to the extent that
failure to comply therewith could not, in the aggregate, reasonably be expected
to have a Material Adverse Effect.

                  6.5 Maintenance of Property; Insurance. (a) Keep all Property
and systems useful and necessary in its business in good working order and
condition, ordinary wear and tear excepted and (b) maintain with financially
sound and reputable insurance companies insurance on all its Property in at
least such amounts and against at least such risks (but including in any event
public liability, product liability and business interruption) as are usually
insured against in the same general area by companies engaged in the same or a
similar business.

                  6.6 Inspection of Property; Books and Records; Discussions.
(a) Keep proper books of records and account in which full, true and correct
entries in conformity with GAAP and all Requirements of Law shall be made of all
dealings and transactions in relation to its business and activities and (b)
permit representatives of any Lender to visit and inspect its corporate offices
and examine and make abstracts from any of its books and records at any
reasonable time upon reasonable prior notice and as often as may reasonably be
desired and to discuss the business, operations, properties and financial and
other condition of Holdings, the Borrower and its Subsidiaries with officers and
employees of Holdings, the Borrower and its Subsidiaries and with its
independent certified public accountants.

                  6.7 Notices. Promptly give notice to the Administrative Agent
and each Lender of:

                  (a) the occurrence of any Default or Event of Default;

                  (b) any (i) default or event of default under any Contractual
Obligation of Holdings, the Borrower or any of its Subsidiaries or (ii)
litigation, investigation or proceeding which may exist at any time between
Holdings, the Borrower or any of its Subsidiaries and any Governmental
Authority, that in either case, if not cured or if adversely determined, as the
case may be, could reasonably be expected to have a Material Adverse Effect;

                  (c) any litigation or proceeding affecting Holdings, the
Borrower or any of its Subsidiaries in which the amount involved is $2,500,000
or more and not covered by insurance or in which injunctive or similar relief is
sought;






                                                                              52


                  (d) the following events, as soon as possible and in any event
within 30 days after the Borrower knows or has reason to know thereof: (i) the
occurrence of any Reportable Event with respect to any Plan, a failure to make
any required contribution to a Plan, the creation of any Lien in favor of a Plan
or any withdrawal from, or the termination, Reorganization or Insolvency of, any
Multiemployer Plan or (ii) the institution of proceedings or the taking of any
other action by the PBGC or the Borrower or any Commonly Controlled Entity or
any Multiemployer Plan with respect to the withdrawal from, or the termination,
Reorganization or Insolvency of, any Plan; and

                  (e) any development or event that has had or could reasonably
be expected to have a Material Adverse Effect.

Each notice pursuant to this Section shall be accompanied by a statement of a
Responsible Officer setting forth details of the occurrence referred to therein
and stating what action Holdings, the Borrower or the relevant Subsidiary
proposes to take with respect thereto.

                  6.8 Environmental Laws. (a) Comply in all material respects
with, and ensure compliance in all material respects by all tenants and
subtenants, if any, with, all applicable Environmental Laws, and obtain and
comply in all material respects with and maintain, and ensure that all tenants
and subtenants obtain and comply in all material respects with and maintain, any
and all licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws.

                  (b) Conduct and complete all investigations, studies, sampling
and testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply in all material respects with all lawful
orders and directives of all Governmental Authorities regarding Environmental
Laws.

                  6.9 Additional Collateral, etc. (a) With respect to any
Property acquired after the Closing Date by Holdings, the Borrower or any of its
Material Subsidiaries (other than (w) any real property, (x) any property
described in paragraph (b) or paragraph (d) of this Section, (y) any Property
subject to a Lien expressly permitted by Section 7.3(g) and (z) Property
acquired by an Excluded Foreign Subsidiary) as to which the Administrative
Agent, for the benefit of the Secured Parties, does not have a perfected Lien,
promptly (i) execute and deliver to the Administrative Agent such amendments to
the Guarantee and Collateral Agreement or such other documents as the
Administrative Agent deems necessary or advisable to grant to the Administrative
Agent, for the benefit of the Secured Parties, a security interest in such
Property and (ii) take all actions necessary or advisable to grant to the
Administrative Agent, for the benefit of the Secured Parties, a perfected first
priority security interest in such Property, including without limitation, the
filing of Uniform Commercial Code financing statements in such jurisdictions as
may be required by the Guarantee and Collateral Agreement or by law or as may be
requested by the Administrative Agent.

                  (b) With respect to (i) any new Material Subsidiary (other
than an Excluded Foreign Subsidiary) created or acquired after the Closing Date
(which, for the purposes of this paragraph, shall include any existing
Subsidiary that ceases to be an Excluded Foreign Subsidiary), by Holdings, the
Borrower or any of its Subsidiaries, (ii) any Excluded Foreign




                                                                              53


Subsidiary which becomes a guarantor of or provides direct credit support with
respect to any Indebtedness of Holdings, the Borrower or any Domestic Subsidiary
or (iii) any Inactive Subsidiary which either ceases to qualify as an Inactive
Subsidiary pursuant to Section 7.18 or is not dissolved prior to December 31,
2002 (such Subsidiary thereafter to be deemed a Material Subsidiary for all
purposes of this Agreement), promptly (A) execute and deliver to the
Administrative Agent such amendments to the Guarantee and Collateral Agreement
as the Administrative Agent deems necessary or advisable to grant to the
Administrative Agent, for the benefit of the Secured Parties, a perfected first
priority security interest in the Capital Stock of such Subsidiary that is owned
by Holdings, the Borrower or any of its Subsidiaries, (B) deliver to the
Administrative Agent the certificates representing such Capital Stock, together
with undated stock powers, in blank, executed and delivered by a duly authorized
officer of Holdings, the Borrower or such Subsidiary, as the case may be, (C)
cause such Subsidiary (1) to become a party to the Guarantee and Collateral
Agreement and (2) to take such actions necessary or advisable to grant to the
Administrative Agent for the benefit of the Secured Parties a perfected first
priority security interest in the Collateral described in the Guarantee and
Collateral Agreement with respect to such Subsidiary, including, without
limitation, the filing of Uniform Commercial Code financing statements in such
jurisdictions as may be required by the Guarantee and Collateral Agreement or by
law or as may be requested by the Administrative Agent, and (D) if requested by
the Administrative Agent, deliver to the Administrative Agent legal opinions
relating to the matters described above, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to the Administrative
Agent.

                  (c) Subject to Section 6.9(b)(ii), with respect to any new
Excluded Foreign Subsidiary created or acquired after the Closing Date by
Holdings, the Borrower or any of its Subsidiaries (other than any Subsidiary
which is an Excluded Foreign Subsidiary), promptly (i) execute and deliver to
the Administrative Agent such amendments to the Guarantee and Collateral
Agreement or such other documents as the Administrative Agent deems necessary or
advisable in order to grant to the Administrative Agent, for the benefit of the
Secured Parties, a perfected first priority security interest in the Capital
Stock of such new Subsidiary that is owned by Holdings, the Borrower or any of
its Subsidiaries (other than any Excluded Foreign Subsidiaries), (provided that
in no event shall more than 65% of the total outstanding Capital Stock of any
such new Excluded Foreign Subsidiary be required to be so pledged), (ii) deliver
to the Administrative Agent the certificates representing such Capital Stock,
together with undated stock powers, in blank, executed and delivered by a duly
authorized officer of Holdings, the Borrower or such Subsidiary, as the case may
be, and take such other action as may be necessary or, in the opinion of the
Administrative Agent, desirable to perfect the Lien of the Administrative Agent
thereon, and (iii) if requested by the Administrative Agent, deliver to the
Administrative Agent legal opinions relating to the matters described above,
which opinions shall be in form and substance, and from counsel, reasonably
satisfactory to the Administrative Agent.

                  (d) If at any time after the Closing Date, any Loan Party
establishes, or any new Subsidiary (other than a Foreign Subsidiary) created or
acquired after the Closing Date holds, a Deposit Account or Securities Account
(other than (x) any Deposit Accounts into which proceeds of Medicare or Medicaid
Receivables (as defined in the Guarantee and Collateral Agreement) are directly
deposited by the obligor thereof, (y) any Deposit Accounts or Securities
Accounts constituting ordinary course operating accounts holding cash and
Investment Property (as defined in the Guarantee and Collateral Agreement) in an
amount (with the value of such



                                                                              54


Investment Property being determined in accordance with GAAP) not exceeding
$100,000 for any such Deposit Account or Securities Account and not exceeding
$2,500,000 in the aggregate for all such Deposit Accounts and Securities
Accounts, in each case excluding Deposit Accounts described in clause (x) above,
and (z) any Securities Account containing Investment Property (as defined in the
Guarantee and Collateral Agreement) the value of which (determined in accordance
with GAAP) does not exceed $100,000) or obtains, or holds, Letter-of-Credit
Rights which do not constitute Supporting Obligations (as defined in the
Guarantee and Collateral Agreement) (other than any such Letter of Credit Rights
the value of which does not exceed $100,000 in the aggregate), promptly but in
any event within 45 days after the establishment or obtaining of such Deposit
Account, Securities Account or Letter-of-Credit Right, or the creation or
acquisition of such Subsidiary, (i) execute and deliver to the Administrative
Agent such amendments to the Guarantee and Collateral Agreement as the
Administrative Agent deems necessary or advisable to grant to the Administrative
Agent, for the benefit of the Secured Parties, a perfected first priority
security interest in such Deposit Account, Securities Account or
Letter-of-Credit Rights and (ii) take such actions necessary or advisable to
grant to the Administrative Agent for the benefit of the Secured Parties a
perfected first priority security interest in such Deposit Account, Securities
Account or Letter-of-Credit Rights, including actions to cause the
Administrative Agent to obtain "control" (within the meaning of the applicable
Uniform Commercial Code) thereof.

                  6.10 Further Assurances. From time to time execute and
deliver, or cause to be executed and delivered, such additional instruments,
certificates or documents, and take such actions, as the Administrative Agent
may reasonably request for the purposes of implementing or effectuating the
provisions of this Agreement and the other Loan Documents, or of more fully
perfecting or renewing the rights of the Administrative Agent and the Lenders
with respect to the Collateral (or with respect to any additions thereto or
replacements or proceeds thereof or with respect to any other property or assets
hereafter acquired by the Borrower or any Subsidiary which may be deemed to be
part of the Collateral) pursuant hereto or thereto. Upon the exercise by the
Administrative Agent or any Lender of any power, right, privilege or remedy
pursuant to this Agreement or the other Loan Documents which requires any
consent, approval, recording, qualification or authorization of any Governmental
Authority, the Borrower will execute and deliver, or will cause the execution
and delivery of, all applications, certifications, instruments and other
documents and papers that the Administrative Agent or such Lender may be
required to obtain from the Borrower or any of its Subsidiaries for such
governmental consent, approval, recording, qualification or authorization.

                  6.11 Use of Proceeds. Use the proceeds of the Loans, and the
Letters of Credit, for working capital needs and general corporate purposes of
the Borrower and its Subsidiaries.


                         SECTION 7. NEGATIVE COVENANTS

                  Holdings and the Borrower hereby jointly and severally agree
that, so long as the Commitments remain in effect, any Letter of Credit remains
outstanding or any Loan or other amount is owing to any Lender or any Agent
hereunder, each of Holdings and the Borrower shall not, and shall not permit any
of its Subsidiaries to, directly or indirectly:




                                                                              55

                  7.1 Financial Condition Covenants.

                  (a) Consolidated Senior Leverage Ratio. Permit the
Consolidated Senior Leverage Ratio as at the last day of any period of four
consecutive fiscal quarters of the Borrower ending with any fiscal quarter set
forth below to exceed the ratio set forth below opposite such fiscal quarter:



                                                                      Consolidated
                  Fiscal Quarter                                  Senior Leverage Ratio
                  --------------                                  ---------------------
                                                                    
                  June 30, 2002 - March 31, 2005                       4.25 to 1.0
                  June 30, 2005 and thereafter                         4.00 to 1.0


                  (b) Consolidated Senior Secured Leverage Ratio. Permit the
Consolidated Senior Secured Leverage Ratio as at the last day of any period of
four consecutive fiscal quarters of the Borrower ending with any fiscal quarter
set forth below to exceed the ratio set forth below opposite such fiscal
quarter:



                                                                      Consolidated
                  Fiscal Quarter                             Senior Secured Leverage Ratio
                  --------------                             -----------------------------
                                                                    
                  June 30, 2002 - March 31, 2005                       1.75 to 1.0
                  June 30, 2005 and thereafter                         1.50 to 1.0


                  (c) Consolidated Fixed Charge Coverage Ratio. Permit the
Consolidated Fixed Charge Coverage Ratio for any period of four consecutive
fiscal quarters of the Borrower ending with any fiscal quarter set forth below
to be less than the ratio set forth below opposite such fiscal quarter:



                                                                     Consolidated
                  Fiscal Quarter                              Fixed Charge Coverage Ratio
                  --------------                              ---------------------------
                                                                    
                  June 30, 2002 - March 31, 2005                       1.10 to 1.0
                  June 30, 2005 and thereafter                         1.20 to 1.0



                  (d) Maintenance of Consolidated Tangible Net Worth. Permit
Consolidated Tangible Net Worth on any date of determination to be less than the
sum of (i) 85% the amount of Consolidated Tangible Net Worth at the end of FQ1
2002, plus (ii) 50% of Consolidated Net Income for each fiscal quarter,
commencing with FQ2 2002 and ending with the fiscal quarter most recently ended
prior to the date of determination, in which Consolidated Net Income was
positive, plus (iii) 100% of the aggregate Net Cash Proceeds of any issuance and
sale after March 31, 2002 of the Capital Stock of the Borrower or any
contribution to the equity of the Borrower after March 31, 2002.



                                                                              56


                  7.2 Limitation on Indebtedness. Create, incur, assume or
suffer to exist any Indebtedness, except:

                  (a) Indebtedness of any Loan Party pursuant to any Loan
Document;

                  (b) Indebtedness of the Borrower to any Subsidiary and of any
Wholly Owned Subsidiary Guarantor to the Borrower or any other Subsidiary
provided such Indebtedness is subordinated to the Obligations;

                  (c) Indebtedness (including, without limitation, Capital Lease
Obligations) secured by Liens permitted by Section 7.3(g) in an aggregate
principal amount not to exceed $5,000,000 at any one time outstanding;

                  (d) Indebtedness outstanding on the date hereof and listed on
Schedule 7.2(d) and any refinancings, refundings, renewals or extensions thereof
(without any increase in the principal amount thereof or any shortening of the
maturity of any principal amount thereof);

                  (e) Guarantee Obligations made in the ordinary course of
business by the Borrower or any of its Subsidiaries of obligations of the
Borrower or any Subsidiary Guarantor;

                  (f) Indebtedness in respect of the Senior Notes in an
aggregate principal amount not to exceed $150,000,000;

                  (g) Non-Recourse Debt in an aggregate principal amount at any
time outstanding not exceeding (i) $50,000,000, at any time when the senior,
unsecured, non credit-enhanced debt of the Borrower is rated lower than either
B1 or BB- by Moody's Investor Service, Inc. ("Moody's") or Standard & Poor's
Ratings Services, a Division of the McGraw Hill Companies, Inc. ("S&P"),
respectively, and (ii) $75,000,000, at any time when the senior, unsecured, non
credit-enhanced debt of the Borrower is rated at least as high as B1 and BB- by
Moody's and S&P, respectively;

                  (h) Indebtedness of any Subsidiary in respect of Investments
permitted by Section 7.8(g) in an aggregate principal amount not to exceed
$10,200,000 and Guarantee Obligations of the Borrower in respect thereof;

                  (i) Indebtedness in respect of Existing Letters of Credit
issued by the Existing Issuing Lender outstanding on the Closing Date; and

                  (j) additional Indebtedness of the Borrower or any of its
Subsidiaries in an aggregate principal amount (for the Borrower and all
Subsidiaries) not to exceed $5,000,000 at any one time outstanding.

                  7.3 Limitation on Liens. Create, incur, assume or suffer to
exist any Lien upon any of its Property, whether now owned or hereafter
acquired, except for:

                  (a) Liens for taxes not yet due or which are being contested
in good faith by appropriate proceedings, provided that adequate reserves with
respect thereto are maintained on the books of the Borrower or its Subsidiaries,
as the case may be, in conformity with GAAP;



                                                                              57

                  (b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary course of business which
are not overdue for a period of more than 30 days or that are being contested in
good faith by appropriate proceedings;

                  (c) pledges or deposits in connection with workers'
compensation, unemployment insurance and other social security legislation;

                  (d) deposits to secure the performance of bids, trade
contracts (other than for borrowed money), leases, statutory obligations, surety
and appeal bonds, performance bonds and other obligations of a like nature, and
letters of credit issued in lieu of or in support of any of the foregoing, in
each case incurred in the ordinary course of business;

                  (e) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business that, in the aggregate,
are not substantial in amount and which do not in any case materially detract
from the value of the Property subject thereto or materially interfere with the
ordinary conduct of the business of the Borrower or any of its Subsidiaries;

                  (f) Liens in existence on the date hereof listed on Schedule
7.3(f), securing Indebtedness permitted by Section 7.2(d), provided that no such
Lien is spread to cover any additional Property after the Closing Date and that
the amount of Indebtedness secured thereby is not increased;

                  (g) Liens securing Indebtedness of the Borrower or any other
Subsidiary incurred pursuant to Section 7.2(c) to finance the acquisition of
fixed or capital assets, provided that (i) such Liens shall be created
substantially simultaneously with the acquisition of such fixed or capital
assets, (ii) such Liens do not at any time encumber any Property other than the
Property financed by such Indebtedness and (iii) the amount of Indebtedness
secured thereby is not increased;

                  (h) Liens in favor of the Administrative Agent created
pursuant to the Security Documents;

                  (i) any interest or title of a lessor under any lease entered
into by the Borrower or any other Subsidiary in the ordinary course of its
business and covering only the assets so leased;

                  (j) Liens on properties purchased by any Subsidiary pursuant
to Section 7.8(g) securing Indebtedness of such Subsidiary incurred pursuant to
Section 7.2(h);

                  (k) Liens securing Permitted Non-Recourse Debt; provided, that
such Liens encumber only the assets financed with the proceeds of such Permitted
Non-Recourse Debt and the Capital Stock of any Non-Recourse Subsidiary created
to incur such Permitted Non-Recourse Debt; and

                  (l) Liens not otherwise permitted by this Section 7.3 so long
as (i) neither (A) the aggregate outstanding principal amount of the obligations
secured thereby nor (B) the aggregate fair market value (determined, in the case
of each such Lien, as of the date such Lien is

                                                                              58

incurred) of the assets subject thereto exceeds (as to the Borrower and all
Subsidiaries) $5,000,000 at any one time and (ii) such Liens do not attach to
any Receivables (as defined in the Guarantee and Collateral Agreement) or
Mortgaged Property.

                  7.4 Limitation on Fundamental Changes. Enter into any merger,
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution), or Dispose of all or substantially all
of its Property or business, except that:

                  (a) any Subsidiary of the Borrower may be merged or
consolidated with or into the Borrower (provided that the Borrower shall be the
continuing or surviving corporation) or with or into any Subsidiary Guarantor
(provided that (i) the Subsidiary Guarantor shall be the continuing or surviving
corporation or (ii) simultaneously with such transaction, the continuing or
surviving corporation shall become a Subsidiary Guarantor and the Borrower shall
comply with Sections 6.9 and 6.10 in connection therewith); and

                  (b) any Subsidiary of the Borrower may Dispose of any or all
of its assets (upon voluntary liquidation or otherwise) to the Borrower or any
Subsidiary Guarantor.

                  7.5 Limitation on Disposition of Property. Dispose of any of
its Property (including, without limitation, receivables and leasehold
interests), whether now owned or hereafter acquired, or, in the case of any
Subsidiary, issue or sell any shares of such Subsidiary's Capital Stock to any
Person, except:

                  (a) the Disposition of obsolete or worn out property in the
ordinary course of business;

                  (b) (i) the sale of inventory in the ordinary course of
business and (ii) the leasing, as lessor, of facilities in the ordinary course
of business under leases providing to the lessor lease income that contributes
to Consolidated EBITDA an amount substantially equivalent to the contribution of
such facilities to Consolidated EBITDA if such facilities were operated by the
Borrower;

                  (c) Dispositions permitted by Section 7.4(b);

                  (d) the sale or issuance of any Subsidiary's Capital Stock to
the Borrower or any Subsidiary Guarantor;

                  (e) the Disposition in the ordinary course of business of Cash
Equivalents and other investment securities;

                  (f) the Disposition of Property of the Borrower or any
Subsidiary in an asset swap; provided, (i) that the amount of Consolidated
EBITDA attributable to any Property so Disposed of by the Borrower or any
Subsidiary, for the period of four consecutive fiscal quarters most recently
ended prior to the date of such Disposition, does not exceed $5,000,000 and (ii)
the amount of Consolidated EBITDA attributable to the Property acquired by the
Borrower or any Subsidiary in such asset swap, for the period of four
consecutive fiscal quarters most recently ended prior to the date of such
Disposition, is not less than 90% of the Consolidated EBITDA for such period of
the asset swapped by the Borrower or such Subsidiary;




                                                                              59

                  (g) the Disposition of Transferred Properties of the Borrower
and its Subsidiaries in transactions resulting in the receipt by the Borrower
and its Subsidiaries of the fair market value of the Transferred Properties, it
being understood that the Disposition of the Transferred Properties for the
purchase price contained in option purchase agreements existing on the Closing
Date and previously disclosed to the Administrative Agent shall constitute fair
market value;

                  (h) the Disposition of notes or other non-cash consideration
received as consideration in connection with Dispositions permitted pursuant to
clause (g) of this Section;

                  (i) the Disposition of other assets in sales for fair market
value; provided, that (i) the aggregate amount of Net Cash Proceeds of such
Dispositions shall not exceed, while this Agreement is in effect (A)
$60,000,000, so long as, at the time of any Disposition pursuant to this clause
(a), the Consolidated Senior Secured Leverage Ratio is not at least 0.50 lower
than the maximum Consolidated Senior Secured Leverage Ratio permitted pursuant
to Section 7.1(b) at the time of such Disposition or (B) $100,000,000, so long
as, at the time of any Disposition pursuant to this clause (b), the Consolidated
Senior Secured Leverage Ratio is at least 0.50 lower than the maximum
Consolidated Senior Secured Leverage Ratio permitted pursuant to Section 7.1(b)
at the time of such Disposition and (ii) not more than 75% of the Net Cash
Proceeds of all such Dispositions shall be attributable to Dispositions of
Properties subject to the Existing Mortgages; and

                  (j) any Recovery Event, provided, that the requirements of
Section 2.7(b) are complied with in connection therewith.

                  7.6 Limitation on Restricted Payments. Declare or pay any
dividend on, or make any payment on account of, or set apart assets for a
sinking or other analogous fund for, the purchase, redemption, defeasance,
retirement or other acquisition of, any Capital Stock of Holdings, the Borrower
or any Subsidiary, whether now or hereafter outstanding, or make any other
distribution in respect thereof, either directly or indirectly, whether in cash
or property or in obligations of Holdings, the Borrower or any Subsidiary, or
enter into any derivatives or other transaction with any financial institution,
commodities or stock exchange or clearinghouse (a "Derivatives Counterparty")
obligating Holdings, the Borrower or any Subsidiary to make payments to such
Derivatives Counterparty as a result of any change in market value of any such
Capital Stock (collectively, "Restricted Payments"), except that:

                  (a) any Subsidiary may make Restricted Payments to the
Borrower or any Subsidiary Guarantor; and

                  (b) the Borrower may make disbursements to Holdings to permit
Holdings to (i) pay corporate overhead expenses incurred in the ordinary course
of business and/or to pay dividends to the Parent to pay Holdings' proportionate
share of corporate overhead expenses of the Parent incurred in the ordinary
course of business, not to exceed $5,000,000 in any fiscal year without the
consent of the Administrative Agent (such consent not to be unreasonably
withheld) and (ii) pay any taxes which are due and payable by Holdings and the
Borrower as part of a consolidated group; provided, that the amount of such
taxes allocated to the Borrower shall be determined on an arms' length basis.




                                                                              60

                  7.7 Limitation on Capital Expenditures. Make or commit to make
any Capital Expenditure, except (a) Consolidated Maintenance Capital
Expenditures of the Borrower and its Subsidiaries in the ordinary course of
business, (b) Capital Expenditures made with the proceeds of any Reinvestment
Deferred Amount and (c) Consolidated Growth Capital Expenditures to the extent
permitted by Section 7.8(h).

                  7.8 Limitation on Investments. Make any advance, loan,
extension of credit (by way of guaranty or otherwise) or capital contribution
to, or purchase any Capital Stock, bonds, notes, debentures or other debt
securities of, or any assets constituting an ongoing business from, or make any
other investment in, any other Person (all of the foregoing, "Investments"),
except:

                  (a) extensions of trade credit in the ordinary course of
business consistent with past practice;

                  (b) investments in Cash Equivalents;

                  (c) Investments arising in connection with the incurrence of
Indebtedness permitted by Section 7.2(b) and (e);

                  (d) (i) advances for business expenses to employees of
Holdings, the Borrower or any Subsidiaries of the Borrower in the ordinary
course of business (including, without limitation, for travel, entertainment and
relocation expenses) and (ii) loans to employees of Holdings, the Borrower or
any Subsidiaries of the Borrower in an aggregate amount for Holdings, the
Borrower and Subsidiaries of the Borrower not to exceed $2,500,000 at any one
time outstanding;

                  (e) Investments in assets (other than inventory) useful in the
Borrower's business made by the Borrower or any of its Subsidiaries with the
proceeds of any Reinvestment Deferred Amount;

                  (f) Investments (other than those relating to the incurrence
of Indebtedness permitted by Section 7.8(c)) by Holdings, the Borrower or any of
its Subsidiaries in the Borrower or any Person that, prior to such Investment,
is a Subsidiary Guarantor;

                  (g) Investments by any Subsidiary in the land, buildings and
equipment of an aggregate of seven nursing facilities located in Ohio and
Indiana which Investment is expected to close by August 31, 2002 and has been
described to the Administrative Agent as the "Holladay transaction"; and

                  (h) in addition to Investments otherwise expressly permitted
by this Section the Borrower or any of its Subsidiaries, may make Investments
and may make Consolidated Growth Capital Expenditures; provided, (i) all such
Investments and Consolidated Growth Capital Expenditures shall be for the
acquisition or improvement of assets (including Capital Stock of another Person)
to be used in the same type of business that the Borrower and its Subsidiaries
are engaged in on the date of this Agreement, (ii) such Investments and
Consolidated Growth Capital Expenditures shall not be limited at any time when
the Consolidated Senior Leverage Ratio is less than 2.50 to 1.00, (iii) the
aggregate amount of all






                                                                              61

such Investments and Consolidated Growth Capital Expenditures at any time when
the Consolidated Senior Leverage Ratio is greater than 2.50 to 1.00 shall not
exceed (A) $20,000,000 for any particular such Investment or Consolidated Growth
Capital Expenditure or (B) an aggregate amount for all such Investments and
Consolidated Growth Capital Expenditures while this Agreement is in effect of
$60,000,000 plus, at any time when the Consolidated Senior Secured Leverage
Ratio is at least 0.25 lower than the maximum level permitted at such time, an
additional amount, not exceeding $30,000,000 in the aggregate, equal to the
aggregate Net Cash Proceeds of Asset Sales consummated after the Closing Date
and (iv) after giving effect to such Investment no Default or Event of Default
shall have occurred and be continuing.

                  7.9 Limitation on Optional Payments and Modifications of Debt
Instruments, etc. (a) Make or offer to make any optional or voluntary payment,
prepayment, repurchase or redemption of, or otherwise voluntarily or optionally
defease, the Senior Subordinated Notes or the Senior Notes, or segregate funds
for any such payment, prepayment, repurchase, redemption or defeasance, or enter
into any derivative or other transaction with any Derivatives Counterparty
obligating Holdings, the Borrower or any Subsidiary to make payments to such
Derivatives Counterparty as a result of any change in market value of the Senior
Subordinated Notes or the Senior Notes, (b) repurchase or redeem any or all of
the Senior Notes or the Senior Subordinated Notes upon occurrence of a Specified
Change of Control, (c) amend, modify or otherwise change, or consent or agree to
any amendment, modification, waiver or other change to, any of the terms of the
Senior Subordinated Notes or the Senior Notes (other than any such amendment,
modification, waiver or other change which (i) would extend the maturity or
reduce the amount of any payment of principal thereof, reduce the rate or extend
the date for payment of interest thereon or relax any covenant or other
restriction applicable to Holdings, the Borrower or any of its Subsidiaries and
(ii) does not involve the payment of a consent fee), (d) designate any
Indebtedness (other than the Obligations) as "Designated Senior Indebtedness"
for the purposes of the Senior Subordinated Note Indenture or (e) amend its
certificate of incorporation in any manner determined by the Administrative
Agent to be adverse to the Lenders.

                  7.10 Limitation on Transactions with Affiliates. Enter into
any transaction, including, without limitation, any purchase, sale, lease or
exchange of Property, the rendering of any service or the payment of any
management, advisory or similar fees, with any Affiliate (other than Holdings,
the Borrower or any Subsidiary Guarantor) unless such transaction is (a)
otherwise permitted under this Agreement, (b) in the ordinary course of business
of Holdings, the Borrower or such Subsidiary, as the case may be, and (c) upon
fair and reasonable terms no less favorable to Holdings, the Borrower or such
Subsidiary, as the case may be, than it would obtain in a comparable arm's
length transaction with a Person that is not an Affiliate.

                  7.11 [Reserved]

                  7.12 Limitation on Changes in Fiscal Periods. Permit the
fiscal year of the Borrower to end on a day other than December 31 or change the
Borrower's method of determining fiscal quarters.

                  7.13 Limitation on Negative Pledge Clauses. Enter into or
suffer to exist or become effective any agreement that prohibits or limits the
ability of Holdings, the Borrower or





                                                                              62


any of its Subsidiaries to create, incur, assume or suffer to exist any Lien
upon any of its Property or revenues, whether now owned or hereafter acquired,
to secure the Obligations or, in the case of any guarantor, its obligations
under the Guarantee and Collateral Agreement, other than (a) this Agreement and
the other Loan Documents, (b) the Senior Subordinated Note Indenture and the
Senior Note Indenture,) and (c) any agreements governing any purchase money
Liens or Permitted Non-Recourse Indebtedness or Capital Lease Obligations
otherwise permitted hereby (in which case, any prohibition or limitation shall
only be effective against the assets financed thereby).

                  7.14 Limitation on Restrictions on Subsidiary Distributions.
Enter into or suffer to exist or become effective any consensual encumbrance or
restriction on the ability of any Subsidiary to (a) make Restricted Payments in
respect of any Capital Stock of such Subsidiary held by, or pay any Indebtedness
owed to, the Borrower or any other Subsidiary, (b) make Investments in the
Borrower or any other Subsidiary or (c) transfer any of its assets to the
Borrower or any other Subsidiary, except for such encumbrances or restrictions
existing under or by reason of (i) any restrictions existing under the Loan
Documents, (ii) any restrictions with respect to a Subsidiary imposed pursuant
to an agreement that has been entered into in connection with the Disposition of
all or substantially all of the Capital Stock or assets of such Subsidiary,
(iii) any restrictions in any agreements governing any purchase money
Indebtedness or Capital Lease Obligations or Permitted Non-Recourse Indebtedness
otherwise permitted hereby (in which case, any prohibition or limitation shall
only be effective against the assets financed thereby) and (iv) any restrictions
in any agreements governing Indebtedness of Foreign Subsidiaries otherwise
permitted hereby (in which case, any restrictions shall only be effective
against such Foreign Subsidiary and its Foreign Subsidiaries).

                  7.15 Limitation on Lines of Business. Enter into any business,
either directly or through any Subsidiary, except for those businesses in which
the Borrower and its Subsidiaries are engaged on the date of this Agreement or
that are reasonably related thereto.

                  7.16 Limitation on Activities of Holdings. In the case of
Holdings, notwithstanding anything to the contrary in this Agreement or any
other Loan Document, (a) hold any assets other than the Capital Stock of the
Borrower and the other direct Subsidiaries of Holdings, (b) have any liabilities
other than (i) the liabilities under the Loan Documents, (ii) tax liabilities in
the ordinary course of business, (iii) Investments permitted under Section
7.8(f) and (iv) corporate, administrative and operating expenses in the ordinary
course of business and (c) engage in any business other than (i) owning the
Capital Stock of the Borrower and its other Subsidiaries and activities
incidental or related thereto and (ii) acting as a Guarantor and pledging the
Capital Stock of the Borrower to the Administrative Agent, for the benefit of
the Secured Parties, pursuant to the Guarantee and Collateral Agreement.

                  7.17 Limitation on Hedge Agreements. Enter into any Hedge
Agreement other than Hedge Agreements entered into in the ordinary course of
business, and not for speculative purposes, to protect against changes in
interest rates, commodity prices or foreign exchange rates.

                  7.18 Limitation on Activities of Inactive Subsidiaries. In the
case of each Inactive Subsidiary, engage in any material business operations,
(ii) guarantee, or otherwise





                                                                              63

provide direct credit support (including a Lien on its assets) for, Indebtedness
of Holdings, the Borrower or any of its Subsidiaries, (iii) own assets having a
fair market value which, when added to the assets of all other Inactive
Subsidiaries, exceeds 5% of the fair market value of consolidated assets of the
Borrower and its Subsidiaries or (iv) have Consolidated EBITDA which, when added
to the Consolidated EBITDA of all other Inactive Subsidiaries, constitutes more
than 5% of the Consolidated EBITDA of the Borrower and its Subsidiaries.



                          SECTION 8. EVENTS OF DEFAULT

                  If any of the following events shall occur and be continuing:

                  (a) The Borrower shall fail to pay any principal of any Loan
or Reimbursement Obligation when due in accordance with the terms hereof; or the
Borrower shall fail to pay any interest on any Loan or Reimbursement Obligation,
or any other amount payable hereunder or under any other Loan Document, within
five days after any such interest or other amount becomes due in accordance with
the terms hereof or thereof; or

                  (b) Any representation or warranty made or deemed made by any
Loan Party herein or in any other Loan Document or that is contained in any
certificate, document or financial or other statement furnished by it at any
time under or in connection with this Agreement or any such other Loan Document
shall prove to have been inaccurate in any material respect on or as of the date
made or deemed made or furnished; or

                  (c) (i) Any Loan Party shall default in the observance or
performance of any agreement contained in clause (i) or (ii) of Section 6.4(a)
(with respect to Holdings and the Borrower only), Section 6.7(a) or Section 7,
or in Section 5 of the Guarantee and Collateral Agreement or (ii) an "Event of
Default" under and as defined in any Mortgage shall have occurred and be
continuing; or

                  (d) Any Loan Party shall default in the observance or
performance of any other agreement contained in this Agreement or any other Loan
Document (other than as provided in paragraphs (a) through (c) of this Section),
and such default shall continue unremedied for a period of 30 days; or

                  (e) Holdings, the Borrower or any of its Material Subsidiaries
shall (i) default in making any payment of any principal of any Indebtedness
(including, without limitation, any Guarantee Obligation, but excluding the
Loans and Reimbursement Obligations) on the scheduled or original due date with
respect thereto; or (ii) default in making any payment of any interest on any
such Indebtedness beyond the period of grace, if any, provided in the instrument
or agreement under which such Indebtedness was created; or (iii) default in the
observance or performance of any other agreement or condition relating to any
such Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event shall occur or condition exist,
the effect of which default or other event or condition is to cause, or to
permit the holder or beneficiary of such Indebtedness (or a trustee or agent on
behalf of such holder or beneficiary) to cause, with the giving of notice if
required, such Indebtedness to become due prior to its stated maturity or to
become subject to or mandatory offer to purchase by





                                                                              64


the obligor thereunder or (in the case of any such Indebtedness constituting a
Guarantee Obligation) to become payable; provided, that a default, event or
condition described in clause (i), (ii) or (iii) of this paragraph (e) shall not
at any time constitute an Event of Default unless, at such time, one or more
defaults, events or conditions of the type described in clauses (i), (ii) and
(iii) of this paragraph (e) shall have occurred and be continuing with respect
to Indebtedness, individually or in the aggregate, the outstanding principal
amount of which exceeds in the aggregate $5,000,000; or

                  (f) (i) Holdings, the Borrower or any of its Material
Subsidiaries shall commence any case, proceeding or other action (A) under any
existing or future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an
order for relief entered with respect to it, or seeking to adjudicate it a
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
winding-up, liquidation, dissolution, composition or other relief with respect
to it or its debts, or (B) seeking appointment of a receiver, trustee,
custodian, conservator or other similar official for it or for all or any
substantial part of its assets, or Holdings, the Borrower or any of its Material
Subsidiaries shall make a general assignment for the benefit of its creditors;
or (ii) there shall be commenced against Holdings, the Borrower or any of its
Material Subsidiaries any case, proceeding or other action of a nature referred
to in clause (i) above that (A) results in the entry of an order for relief or
any such adjudication or appointment or (B) remains undismissed, undischarged or
unbonded for a period of 60 days; or (iii) there shall be commenced against
Holdings, the Borrower or any of its Material Subsidiaries any case, proceeding
or other action seeking issuance of a warrant of attachment, execution,
distraint or similar process against all or any substantial part of its assets
that results in the entry of an order for any such relief that shall not have
been vacated, discharged, or stayed or bonded pending appeal within 60 days from
the entry thereof; or (iv) Holdings, the Borrower or any of its Material
Subsidiaries shall take any action in furtherance of, or indicating its consent
to, approval of, or acquiescence in, any of the acts set forth in clause (i),
(ii), or (iii) above; or (v) Holdings, the Borrower or any of its Material
Subsidiaries shall generally not, or shall be unable to, or shall admit in
writing its inability to, pay its debts as they become due; or

                  (g) Any Person shall engage in any "prohibited transaction"
(as defined in Section 406 of ERISA or Section 4975 of the Code) involving any
Plan, (ii) any "accumulated funding deficiency" (as defined in Section 302 of
ERISA), whether or not waived, shall exist with respect to any Plan, or any Lien
in favor of the PBGC or a Plan shall arise on the assets of the Borrower or any
Commonly Controlled Entity, (iii) a Reportable Event shall occur with respect
to, or proceedings shall commence to have a trustee appointed, or a trustee
shall be appointed, to administer or to terminate, any Single Employer Plan,
which Reportable Event or commencement of proceedings or appointment of a
trustee is, in the reasonable opinion of the Required Lenders, likely to result
in the termination of such Plan for purposes of Title IV of ERISA, (iv) any
Single Employer Plan shall terminate for purposes of Title IV of ERISA, (v) the
Borrower or any Commonly Controlled Entity shall, or in the reasonable opinion
of the Required Lenders shall be likely to, incur any liability in connection
with a withdrawal from, or the Insolvency or Reorganization of, a Multiemployer
Plan or (vi) any other event or condition shall occur or exist with respect to a
Plan; and in each case in clauses (i) through (vi) above, such event or
condition, together with all other such events or conditions, if any, could, in
the sole judgment of the Required Lenders, reasonably be expected to have a
Material Adverse Effect; or




                                                                              65

                  (h) One or more judgments or decrees shall be entered against
Holdings, the Borrower or any of its Material Subsidiaries involving for
Holdings, the Borrower and its Subsidiaries taken as a whole a liability (not
paid or fully covered by insurance as to which the relevant insurance company
has acknowledged coverage) of $5,000,000 or more, and all such judgments or
decrees shall not have been vacated, discharged, stayed or bonded pending appeal
within 30 days from the entry thereof; or

                  (i) Any of the Security Documents shall cease, for any reason
(other than by reason of the express release thereof pursuant to Section 10.15),
to be in full force and effect, or any Loan Party or any Affiliate of any Loan
Party shall so assert, or any Lien created by any of the Security Documents
shall cease to be enforceable and of the same effect and priority purported to
be created thereby; or

                  (j) The guarantee contained in Section 2 of the Guarantee and
Collateral Agreement shall cease, for any reason (other than by reason of the
express release thereof pursuant to Section 10.15), to be in full force and
effect or any Loan Party or any Affiliate of any Loan Party shall so assert; or

                  (k) Any Change of Control shall occur; or

                  (l) The Senior Subordinated Notes or the guarantees thereof
shall cease, for any reason, to be validly subordinated to the Obligations or
the obligations of the Subsidiary Guarantors under the Guarantee and Collateral
Agreement, as the case may be, as provided in the Senior Subordinated Note
Indenture, or any Loan Party, any Affiliate of any Loan Party, the trustee in
respect of the Senior Subordinated Notes or the holders of at least 25% in
aggregate principal amount of the Senior Subordinated Notes shall so assert; or

                  (m) The Borrower or any Subsidiary, to the extent, if any,
presently participating or required by law to participate, in Medicaid or
Medicare programs is excluded from or shall otherwise fail to be eligible for
any reason to participate in Medicaid or Medicare programs or to accept
assignments or rights to reimbursement under Requirements of Law applicable to
Medicaid or Medicare, such failure could reasonably be expected to have a
Material Adverse Effect, and such failure shall also continue beyond the
completion of any appeal process diligently pursued by the Borrower or such
Subsidiary in good faith;

then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) above with respect to the Borrower,
automatically the Revolving Credit Commitments shall immediately terminate and
the Loans hereunder (with accrued interest thereon) and all other amounts owing
under this Agreement and the other Loan Documents (including, without
limitation, all amounts of L/C Obligations, whether or not the beneficiaries of
the then outstanding Letters of Credit shall have presented the documents
required thereunder) shall immediately become due and payable, and (B) if such
event is any other Event of Default, either or both of the following actions may
be taken: (i) with the consent of the Required Lenders, the Administrative Agent
may, or upon the request of the Required Lenders, the Administrative Agent
shall, by notice to the Borrower declare the Revolving Credit Commitments to be
terminated forthwith, whereupon the Commitments shall immediately terminate; and
(ii) with the consent of the Required Lenders, the Administrative Agent may, or




                                                                              66


upon the request of the Required Lenders, the Administrative Agent shall, by
notice to the Borrower, declare the Loans hereunder (with accrued interest
thereon) and all other amounts owing under this Agreement and the other Loan
Documents (including, without limitation, all amounts of L/C Obligations,
whether or not the beneficiaries of the then outstanding Letters of Credit shall
have presented the documents required thereunder) to be due and payable
forthwith, whereupon the same shall immediately become due and payable; and (C)
the Administrative Agent shall have the rights and remedies provided to it under
the Guarantee and Collateral Agreement or at law or equity, including rights and
remedies provided under the Uniform Commercial Code. In the case of all Letters
of Credit with respect to which presentment for honor shall not have occurred at
the time of an acceleration pursuant to this paragraph, the Borrower shall at
such time deposit in a cash collateral account opened by the Administrative
Agent an amount equal to the aggregate then undrawn and unexpired amount of such
Letters of Credit. Amounts held in such cash collateral account shall be applied
by the Administrative Agent to the payment of drafts drawn under such Letters of
Credit, and the unused portion thereof after all such Letters of Credit shall
have expired or been fully drawn upon, if any, shall be applied to repay other
obligations of the Borrower hereunder and under the other Loan Documents. After
all such Letters of Credit shall have expired or been fully drawn upon, all
Reimbursement Obligations shall have been satisfied and all other obligations of
the Borrower hereunder and under the other Loan Documents shall have been paid
in full, the balance, if any, in such cash collateral account shall be returned
to the Borrower (or such other Person as may be lawfully entitled thereto).

                              SECTION 9. THE AGENTS

                  9.1 Appointment. Each Lender hereby irrevocably designates and
appoints the Agents as the agents of such Lender under this Agreement and the
other Loan Documents, and each Lender irrevocably authorizes each Agent, in such
capacity, to take such action on its behalf under the provisions of this
Agreement and the other Loan Documents and to exercise such powers and perform
such duties as are expressly delegated to such Agent by the terms of this
Agreement and the other Loan Documents, together with such other powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
elsewhere in this Agreement, no Agent shall have any duties or responsibilities,
except those expressly set forth herein, or any fiduciary relationship with any
Lender, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other Loan
Document or otherwise exist against any Agent.

                  9.2 Delegation of Duties. Each Agent may execute any of its
duties under this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. No Agent shall be responsible for the
negligence or misconduct of any agents or attorneys-in-fact selected by it with
reasonable care.

                  9.3 Exculpatory Provisions. Neither any Agent nor any of its
officers, directors, employees, agents, attorneys-in-fact or affiliates shall be
(i) liable for any action lawfully taken or omitted to be taken by it or such
Person under or in connection with this Agreement or any other Loan Document
(except to the extent that any of the foregoing are found by a final and
nonappealable decision of a court of competent jurisdiction to have resulted
from



                                                                              67


its or such Person's own gross negligence or willful misconduct) or (ii)
responsible in any manner to any of the Lenders for any recitals, statements,
representations or warranties made by any Loan Party or any officer thereof
contained in this Agreement or any other Loan Document or in any certificate,
report, statement or other document referred to or provided for in, or received
by the Agents under or in connection with, this Agreement or any other Loan
Document or for the value, validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement or any other Loan Document or for any failure
of any Loan Party to perform its obligations hereunder or thereunder. The Agents
shall not be under any obligation to any Lender to ascertain or to inquire as to
the observance or performance of any of the agreements contained in, or
conditions of, this Agreement or any other Loan Document, or to inspect the
properties, books or records of any Loan Party.

                  9.4 Reliance by Agents. Each Agent shall be entitled to rely,
and shall be fully protected in relying, upon any instrument, writing,
resolution, notice, consent, certificate, affidavit, letter, telecopy, telex or
teletype message, statement, order or other document or conversation believed by
it to be genuine and correct and to have been signed, sent or made by the proper
Person or Persons and upon advice and statements of legal counsel (including,
without limitation, counsel to the Loan Parties), independent accountants and
other experts selected by such Agent. The Agents may deem and treat the payee of
any Note as the owner thereof for all purposes unless such Note shall have been
transferred in accordance with Section 10.6 and all actions required by such
Section in connection with such transfer shall have been taken. Each Agent shall
be fully justified in failing or refusing to take any action under this
Agreement or any other Loan Document unless it shall first receive such advice
or concurrence of the Required Lenders (or, if so specified by this Agreement,
all Lenders or any other instructing group of Lenders specified by this
Agreement) as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense that may
be incurred by it by reason of taking or continuing to take any such action.
Each Agent shall in all cases be fully protected in acting, or in refraining
from acting, under this Agreement and the other Loan Documents in accordance
with a request of the Required Lenders (or, if so specified by this Agreement,
all Lenders or any other instructing group of Lenders specified by this
Agreement), and such request and any action taken or failure to act pursuant
thereto shall be binding upon all the Lenders and all future holders of the
Loans.

                  9.5 Notice of Default. No Agent shall be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless such Agent shall have received notice from a Lender, Holdings
or the Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default". In the event that
the Administrative Agent shall receive such a notice, the Administrative Agent
shall give notice thereof to the Lenders. The Administrative Agent shall take
such action with respect to such Default or Event of Default as shall be
reasonably directed by the Required Lenders (or, if so specified by this
Agreement, all Lenders or any other instructing group of Lenders specified by
this Agreement); provided that unless and until the Administrative Agent shall
have received such directions, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable in the best
interests of the Lenders.




                                                                              68


                  9.6 Non-Reliance on Agents and Other Lenders. Each Lender
expressly acknowledges that neither any of the Agents nor any of their
respective officers, directors, employees, agents, attorneys-in-fact or
affiliates have made any representations or warranties to it and that no act by
any Agent hereafter taken, including any review of the affairs of a Loan Party
or any affiliate of a Loan Party, shall be deemed to constitute any
representation or warranty by any Agent to any Lender. Each Lender represents to
the Agents that it has, independently and without reliance upon any Agent or any
other Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
operations, property, financial and other condition and creditworthiness of the
Loan Parties and their affiliates and made its own decision to make its Loans
hereunder and enter into this Agreement. Each Lender also represents that it
will, independently and without reliance upon any Agent or any other Lender, and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit analysis, appraisals and decisions in
taking or not taking action under this Agreement and the other Loan Documents,
and to make such investigation as it deems necessary to inform itself as to the
business, operations, property, financial and other condition and
creditworthiness of the Loan Parties and their affiliates. Except for notices,
reports and other documents expressly required to be furnished to the Lenders by
the Administrative Agent hereunder, no Agent shall have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of any Loan Party or any affiliate of
a Loan Party that may come into the possession of such Agent or any of its
officers, directors, employees, agents, attorneys-in-fact or affiliates.

                  9.7 Indemnification. The Lenders severally agree to indemnify
each Agent in its capacity as such (to the extent not reimbursed by Holdings or
the Borrower and without limiting the obligation of Holdings or the Borrower to
do so), ratably according to their respective Aggregate Exposure Percentages in
effect on the date on which indemnification is sought under this Section (or, if
indemnification is sought after the date upon which the Commitments shall have
terminated and the Loans shall have been paid in full, ratably in accordance
with such Aggregate Exposure Percentages immediately prior to such date), for,
and to save each Agent harmless from and against, any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind whatsoever that may at any time
(including, without limitation, at any time following the payment of the Loans)
be imposed on, incurred by or asserted against such Agent in any way relating to
or arising out of, the Commitments, this Agreement, any of the other Loan
Documents or any documents contemplated by or referred to herein or therein or
the transactions contemplated hereby or thereby or any action taken or omitted
by such Agent under or in connection with any of the foregoing; provided that no
Lender shall be liable for the payment of any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements that are found by a final and nonappealable decision
of a court of competent jurisdiction to have resulted from such Agent's gross
negligence or willful misconduct. The agreements in this Section shall survive
the payment of the Loans and all other amounts payable hereunder.

                  9.8 Agent in Its Individual Capacity. Each Agent and its
affiliates may make loans to, accept deposits from and generally engage in any
kind of business with any Loan Party



                                                                              69

as though such Agent were not an Agent. With respect to its Loans made or
renewed by it and with respect to any Letter of Credit issued or participated in
by it, each Agent shall have the same rights and powers under this Agreement and
the other Loan Documents as any Lender and may exercise the same as though it
were not an Agent, and the terms "Lender" and "Lenders" shall include each Agent
in its individual capacity.

                  9.9 Successor Administrative Agent. The Administrative Agent
may resign as Administrative Agent upon 10 days' notice to the Lenders and the
Borrower. If the Administrative Agent shall resign as Administrative Agent under
this Agreement and the other Loan Documents, then the Required Lenders shall
appoint from among the Lenders a successor agent for the Lenders, which
successor agent shall (unless an Event of Default under Section 8(a) or Section
8(f) with respect to the Borrower shall have occurred and be continuing) be
subject to approval by the Borrower (which approval shall not be unreasonably
withheld or delayed), whereupon such successor agent shall succeed to the
rights, powers and duties of the Administrative Agent, and the term
"Administrative Agent" shall mean such successor agent effective upon such
appointment and approval, and the former Administrative Agent's rights, powers
and duties as Administrative Agent shall be terminated, without any other or
further act or deed on the part of such former Administrative Agent or any of
the parties to this Agreement or any holders of the Loans. If no successor agent
has accepted appointment as Administrative Agent by the date that is 10 days
following a retiring Administrative Agent's notice of resignation, the retiring
Administrative Agent's resignation shall nevertheless thereupon become
effective, and the Lenders shall assume and perform all of the duties of the
Administrative Agent hereunder until such time, if any, as the Required Lenders
appoint a successor agent as provided for above. The Syndication Agent may, at
any time, by notice to the Lenders and the Administrative Agent, resign as
Syndication Agent hereunder, whereupon the duties, rights, obligations and
responsibilities of the Syndication Agent hereunder shall automatically be
assumed by, and inure to the benefit of, the Administrative Agent, without any
further act by the Syndication Agent, the Administrative Agent or any Lender.
After any retiring Agent's resignation as Agent, the provisions of this Section
9 shall inure to its benefit as to any actions taken or omitted to be taken by
it while it was Agent under this Agreement and the other Loan Documents.

                  9.10 Authorization to Release Liens and Guarantees. The
Administrative Agent is hereby irrevocably authorized by each of the Lenders to
effect any release of Liens or guarantee obligations contemplated by Section
10.15.

                  9.11 The Arranger; the Syndication Agent; the Co-Documentation
Agents. None of the Arranger, the Syndication Agent or any Co-Documentation
Agent, in their respective capacities as such, shall have any duties or
responsibilities, or incur any liability, under this Agreement and the other
Loan Documents.

                  9.12 The Administrative Agent and the Secured Parties.
Notwithstanding that the Administrative Agent is named in one or more of the
Security Documents as agent for Qualified Counterparties as well as for the
Lenders, each Lender agrees, on behalf of itself and any affiliate thereof that
may at any time be a Qualified Counterparty under any Specified Hedge Agreement,
that the Administrative Agent (i) shall have no duty or obligation whatsoever to
any Qualified Counterparty under any Specified Hedge Agreement, and (ii) shall
have no duty or





                                                                              70


obligation to any Qualified Counterparty under any Security Documents other than
the obligation to deliver to such Qualified Counterparty its ratable share (as
determined by the Administrative Agent) of any proceeds received by the
Administrative Agent under the Security Documents upon the exercise by the
Administrative Agent of its remedies thereunder. Without limiting the generality
of the foregoing, each Lender agrees, on behalf of itself and any affiliate
thereof that may at any time be a Qualified Counterparty under any Specified
Hedge Agreement, that (i) the Administrative Agent shall incur no liability to
any Qualified Counterparty as a result of any release by the Administrative
Agent of any Collateral or Guarantors under any Security Document or any other
action or inaction by the Administrative Agent under any Security Document and
(ii) the Administrative Agent shall be entitled to the same exculpations and
protections, in respect of the Qualified Counterparties, as it is entitled to
with respect to the Lenders pursuant to the other provisions of this Section 9
(other than Section 9.7), mutatis mutandis.


                           SECTION 10. MISCELLANEOUS

                  10.1 Amendments and Waivers. Neither this Agreement or any
other Loan Document, nor any terms hereof or thereof may be amended,
supplemented or modified except in accordance with the provisions of this
Section 10.1. The Required Lenders and each Loan Party party to the relevant
Loan Document may, or (with the written consent of the Required Lenders) the
Agents and each Loan Party party to the relevant Loan Document may, from time to
time, (a) enter into written amendments, supplements or modifications hereto and
to the other Loan Documents (including amendments and restatements hereof or
thereof) for the purpose of adding any provisions to this Agreement or the other
Loan Documents or changing in any manner the rights of the Lenders or of the
Loan Parties hereunder or thereunder or (b) waive, on such terms and conditions
as may be specified in the instrument of waiver, any of the requirements of this
Agreement or the other Loan Documents or any Default or Event of Default and its
consequences; provided, however, that no such waiver and no such amendment,
supplement or modification shall:

                       (i)    forgive the principal amount or extend the final
                              scheduled date of maturity of any Loan or
                              Reimbursement Obligation, reduce the stated rate
                              of any interest or fee payable hereunder or extend
                              the scheduled date of any payment thereof, or
                              increase the amount or extend the expiration date
                              of any the Revolving Credit Commitment of any
                              Lender, in each case without the consent of each
                              Lender directly affected thereby;

                       (ii)   amend, modify or waive any provision of this
                              Section or reduce any percentage specified in the
                              definition of Required Lenders, consent to the
                              assignment or transfer by the Borrower of any of
                              its rights and obligations under this Agreement
                              and the other Loan Documents, release all or
                              substantially all of the Collateral or release all
                              or substantially all of the Guarantors from their
                              guarantee obligations under the Guarantee and
                              Collateral Agreement, in each case without the
                              consent of all Lenders;



                                                                              71

                       (iii)  amend, modify or waive any provision of Section 9
                              or any other provision of this Agreement which
                              directly affects the rights or obligations of any
                              Agent, in either case without the consent of each
                              Agent directly affected thereby;

                       (iv)   amend, modify or waive any provision of Section
                              2.13(a) or (b) without the consent of each Lender
                              directly affected thereby; or

                       (v)    amend, modify or waive any provision of Section 3
                              without the consent of each relevant Issuing
                              Lender.

Any such waiver and any such amendment, supplement or modification shall apply
equally to each of the Lenders and shall be binding upon the Loan Parties, the
Lenders, the Agents and all future holders of the Loans. In the case of any
waiver, the Loan Parties, the Lenders and the Agents shall be restored to their
former position and rights hereunder and under the other Loan Documents, and any
Default or Event of Default waived shall be deemed to be cured and not
continuing; but no such waiver shall extend to any subsequent or other Default
or Event of Default, or impair any right consequent thereon. Any such waiver,
amendment, supplement or modification shall be effected by a written instrument
signed by the parties required to sign pursuant to the foregoing provisions of
this Section; provided, that delivery of an executed signature page of any such
instrument by facsimile transmission shall be effective as delivery of a
manually executed counterpart thereof.

                  For the avoidance of doubt, this Agreement and any other Loan
Document may be amended (or amended and restated) with the written consent of
the Required Lenders, the Administrative Agent and each Loan Party to each
relevant Loan Document (x) to add one or more additional credit facilities to
this Agreement and to permit the extensions of credit from time to time
outstanding thereunder and the accrued interest and fees in respect thereof
(collectively, the "Additional Extensions of Credit") to share ratably in the
benefits of this Agreement and the other Loan Documents with the Revolving
Extensions of Credit and the accrued interest and fees in respect thereof and
(y) to include appropriately the Lenders holding such credit facilities in any
determination of the Required Lenders; provided that any proposed Additional
Extensions of Credit which, when added to the Total Revolving Credit Commitments
then in effect, would cause the Total Revolving Credit Commitments, or if the
Additional Extensions of Credit shall include term loans, the sum of the Total
Revolving Credit Commitments and such term loans, to exceed $250,000,000 shall
require the written consent of Lenders holding 90% or more of the Total
Revolving Credit Commitments then in effect.

                  10.2 Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered, or three Business Days after being
deposited in the mail, postage prepaid, or, in the case of telecopy notice, when
received, addressed (a) in the case of Holdings, the Borrower and the Agents, as
follows and (b) in the case of the Lenders, as set forth in an administrative
questionnaire delivered to the Administrative Agent or on Schedule I to the
Lender Addendum to which such Lender is a party or, in the case of a Lender
which becomes a party to this Agreement pursuant to





                                                                              72

an Assignment and Acceptance, in such Assignment and Acceptance or (c) in the
case of any party, to such other address as such party may hereafter notify to
the other parties hereto:

                  Holdings:                    Extendicare Holdings, Inc.
                                               111 West Michigan Street
                                               Milwaukee, Wisconsin 53203-290
                                               Attention: President

                                               with a copy to:

                                               Extendicare Holdings, Inc.
                                               111 West Michigan Street
                                               Milwaukee, Wisconsin 53203-290
                                               Attention: General Counsel

                  The Borrower:                Extendicare Health Services, Inc.
                                               111 West Michigan Street
                                               Milwaukee, Wisconsin 53203-290
                                               Attention: President

                                               with a copy to:

                                               Extendicare Holdings, Inc.
                                               111 West Michigan Street
                                               Milwaukee, Wisconsin 53203-290
                                               Attention: General Counsel

                  The Administrative Agent:    Lehman Commercial Paper Inc.
                                               745 Seventh Avenue
                                               New York, New York 10019
                                               Attention:  Diane Albanese
                                               Telecopy:  (212) 526-6643
                                               Telephone:  (212) 526-6590

                  Issuing Lender:              As notified by such Issuing
                                               Lender to the Administrative
                                               Agent and the Borrower

provided that any notice, request or demand to or upon the any Agent, any
Issuing Lender or any Lender shall not be effective until received.

                  10.3 No Waiver; Cumulative Remedies. No failure to exercise
and no delay in exercising, on the part of any Agent or any Lender, any right,
remedy, power or privilege hereunder or under the other Loan Documents shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exclusive of any rights, remedies, powers and privileges provided by law.

                                                                              73

                  10.4 Survival of Representations and Warranties. All
representations and warranties made herein, in the other Loan Documents and in
any document, certificate or statement delivered pursuant hereto or in
connection herewith shall survive the execution and delivery of this Agreement
and the making of the Loans and other extensions of credit hereunder.

                  10.5 Payment of Expenses. Each of Holdings and the Borrower
agrees (a) to pay or reimburse the Administrative Agent for all its reasonable
out-of-pocket costs and expenses incurred in connection with the syndication of
the Facilities (other than fees payable to syndicate members) and the
development, preparation and execution of, and any amendment, supplement or
modification to, this Agreement and the other Loan Documents and any other
documents prepared in connection herewith or therewith, and the consummation and
administration of the transactions contemplated hereby and thereby, including,
without limitation, the reasonable fees and disbursements and other charges of
counsel to the Administrative Agent and the charges of Intralinks, (b) to pay or
reimburse each Lender and the Agents for all their costs and expenses incurred
in connection with the enforcement or preservation of any rights under this
Agreement, the other Loan Documents and any other documents prepared in
connection herewith or therewith, including, without limitation, the fees and
disbursements of counsel (including the allocated fees and disbursements and
other charges of in-house counsel) to each Lender and of counsel to the Agents,
(c) to pay, indemnify, or reimburse each Lender and the Agents for, and hold
each Lender and the Agents harmless from, any and all recording and filing fees
and any and all liabilities with respect to, or resulting from any delay in
paying, stamp, excise and other taxes, if any, which may be payable or
determined to be payable in connection with the execution and delivery of, or
consummation or administration of any of the transactions contemplated by, or
any amendment, supplement or modification of, or any waiver or consent under or
in respect of, this Agreement, the other Loan Documents and any such other
documents, and (d) to pay, indemnify or reimburse each Lender, each Agent, their
respective affiliates, and their respective officers, directors, trustees,
employees, advisors, agents and controlling persons (each, an "Indemnitee") for,
and hold each Indemnitee harmless from and against any and all other
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever with respect
to the execution, delivery, enforcement, performance and administration of this
Agreement, the other Loan Documents and any such other documents, including,
without limitation, any of the foregoing relating to the use of proceeds of the
Loans or the violation of, noncompliance with or liability under, any
Environmental Law applicable to the operations of Holdings, the Borrower any of
its Subsidiaries or any of the Properties and the fees and disbursements and
other charges of legal counsel in connection with claims, actions or proceedings
by any Indemnitee against the Borrower hereunder (all the foregoing in this
clause (d), collectively, the "Indemnified Liabilities"), provided, that
Holdings and the Borrower shall have no obligation hereunder to any Indemnitee
with respect to Indemnified Liabilities to the extent such Indemnified
Liabilities are found by a final and nonappealable decision of a court of
competent jurisdiction to have resulted from the gross negligence or willful
misconduct of such Indemnitee. No Indemnitee shall be liable for any damages
arising from the use by unauthorized persons of Information or other materials
sent through electronic, telecommunications or other information transmission
systems that are intercepted by such persons or for any special, indirect,
consequential or punitive damages in connection with the Revolving Credit
Commitments. Without limiting the foregoing, and to the extent permitted by
applicable law, the Borrower agrees not to assert and to cause its Subsidiaries
not to assert, and hereby waives and



                                                                              74

agrees to cause its Subsidiaries so to waive, all rights for contribution or any
other rights of recovery with respect to all claims, demands, penalties, fines,
liabilities, settlements, damages, costs and expenses of whatever kind or
nature, under or related to Environmental Laws, that any of them might have by
statute or otherwise against any Indemnitee. All amounts due under this Section
shall be payable not later than 30 days after written demand therefor.
Statements payable by the Borrower pursuant to this Section shall be submitted
to the Borrower at its address set forth in Section 10.2, or to such other
Person or address as may be hereafter designated by the Borrower in a notice to
the Administrative Agent. The agreements in this Section shall survive repayment
of the Loans and all other amounts payable hereunder.

                  10.6 Successors and Assigns; Participations and Assignments.
(a) This Agreement shall be binding upon and inure to the benefit of Holdings,
the Borrower, the Lenders, the Agents, all future holders of the Loans and their
respective successors and assigns, except that Holdings and the Borrower may not
assign or transfer any of its rights or obligations under this Agreement without
the prior written consent of the Agents and each Lender.

                  (b) Any Lender may, without the consent of the Borrower, in
accordance with applicable law, at any time sell to one or more banks, financial
institutions or other entities (each, a "Participant") participating interests
in any Loan owing to such Lender, any Commitment of such Lender or any other
interest of such Lender hereunder and under the other Loan Documents. In the
event of any such sale by a Lender of a participating interest to a Participant,
such Lender's obligations under this Agreement to the other parties to this
Agreement shall remain unchanged, such Lender shall remain solely responsible
for the performance thereof, such Lender shall remain the holder of any such
Loan for all purposes under this Agreement and the other Loan Documents, and the
Borrower and the Agents shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under this
Agreement and the other Loan Documents. In no event shall any Participant under
any such participation have any right to approve any amendment or waiver of any
provision of any Loan Document, or any consent to any departure by any Loan
Party therefrom, except to the extent that such amendment, waiver or consent
would require the consent of all Lenders pursuant to Section 10.1. The Borrower
agrees that if amounts outstanding under this Agreement and the Loans are due or
unpaid, or shall have been declared or shall have become due and payable upon
the occurrence of an Event of Default, each Participant shall, to the maximum
extent permitted by applicable law, be deemed to have the right of setoff in
respect of its participating interest in amounts owing under this Agreement to
the same extent as if the amount of its participating interest were owing
directly to it as a Lender under this Agreement, provided that, in purchasing
such participating interest, such Participant shall be deemed to have agreed to
share with the Lenders the proceeds thereof as provided in Section 10.7(a) as
fully as if such Participant were a Lender hereunder. The Borrower also agrees
that each Participant shall be entitled to the benefits of Sections 2.14, 2.15
and 2.16 with respect to its participation in the Commitments and the Loans
outstanding from time to time as if such Participant were a Lender; provided
that, in the case of Section 2.15, such Participant shall have complied with the
requirements of said Section, and provided, further, that no Participant shall
be entitled to receive any greater amount pursuant to any such Section than the
transferor Lender would have been entitled to receive in respect of the amount
of the participation transferred by such transferor Lender to such Participant
had no such transfer occurred.



                                                                              75

                  (c) Any Lender (an "Assignor") may, in accordance with
applicable law and upon written notice to the Administrative Agent, at any time
and from time to time assign to any Lender or any affiliate, Related Fund or
Control Investment Affiliate thereof or, with the consent of the Borrower, the
Agents and each Issuing Lender (which, in each case, shall not be unreasonably
withheld or delayed) (provided that no such consent need be obtained by any
Lehman Entity), to an additional bank, financial institution or other entity (an
"Assignee") all or any part of its rights and obligations under this Agreement
pursuant to an Assignment and Acceptance, substantially in the form of Exhibit
E, executed by such Assignee and such Assignor (and, where the consent of the
Borrower the Agents or the Issuing Lender is required pursuant to the foregoing
provisions, by the Borrower and such other Persons) and delivered to the
Administrative Agent for its acceptance and recording in the Register; provided
that no such assignment to an Assignee (other than any Lender or any affiliate
thereof) shall be in an aggregate principal amount of less than $5,000,000
(other than in the case of an assignment of all of a Lender's interests under
this Agreement), unless otherwise agreed by the Borrower and the Administrative
Agent. Upon such execution, delivery, acceptance and recording, from and after
the effective date determined pursuant to such Assignment and Acceptance, (x)
the Assignee thereunder shall be a party hereto and, to the extent provided in
such Assignment and Acceptance, have the rights and obligations of a Lender
hereunder with Commitments and/or Loans as set forth therein, and (y) the
Assignor thereunder shall, to the extent provided in such Assignment and
Acceptance, be released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all of an Assignor's rights and
obligations under this Agreement, such Assignor shall cease to be a party
hereto, except as to Section 2.14, 2.15 and 10.5 in respect of the period prior
to such effective date). Notwithstanding any provision of this Section, the
consent of the Borrower shall not be required for any assignment that occurs at
any time when any Event of Default shall have occurred and be continuing. For
purposes of the minimum assignment amounts set forth in this paragraph, multiple
assignments by two or more Related Funds shall be aggregated.

                  (d) The Administrative Agent shall, on behalf of the Borrower,
maintain at its address referred to in Section 10.2 a copy of each Assignment
and Acceptance delivered to it and a register (the "Register") for the
recordation of the names and addresses of the Lenders and the Commitment of, and
principal amount of the Loans owing to, each Lender from time to time. The
entries in the Register shall be conclusive, in the absence of manifest error,
and the Borrower, each Agent and the Lenders shall treat each Person whose name
is recorded in the Register as the owner of the Loans and any Notes evidencing
such Loans recorded therein for all purposes of this Agreement. Any assignment
of any Loan, whether or not evidenced by a Note, shall be effective only upon
appropriate entries with respect thereto being made in the Register (and each
Note shall expressly so provide). Any assignment or transfer of all or part of a
Loan evidenced by a Note shall be registered on the Register only upon surrender
for registration of assignment or transfer of the Note evidencing such Loan,
accompanied by a duly executed Assignment and Acceptance; thereupon one or more
new Notes in the same aggregate principal amount shall be issued to the
designated Assignee, and the old Notes shall be returned by the Administrative
Agent to the Borrower marked "canceled". The Register shall be available for
inspection by the Borrower or any Lender (with respect to any entry relating to
such Lender's Loans) at any reasonable time and from time to time upon
reasonable prior notice.



                                                                              76

                  (e) Upon its receipt of an Assignment and Acceptance executed
by an Assignor and an Assignee (and, in any case where the consent of any other
Person is required by Section 10.6(c), by each such other Person) together with
payment to the Administrative Agent of a registration and processing fee of
$3,500 (treating multiple, simultaneous assignments by or to two or more Related
Funds as a single assignment) (except that no such registration and processing
fee shall be payable (y) in connection with an assignment by or to a Lehman
Entity or (z) in the case of an Assignee which is already a Lender or is an
affiliate or Related Fund of a Lender or a Person under common management with a
Lender), the Administrative Agent shall (i) promptly accept such Assignment and
Acceptance and (ii) on the effective date determined pursuant thereto record the
information contained therein in the Register and give notice of such acceptance
and recordation to the Borrower. On or prior to such effective date, the
Borrower, at its own expense, upon request, shall execute and deliver to the
Administrative Agent (in exchange for the Revolving Credit Note of the assigning
Lender) a new Revolving Credit Note to the order of such Assignee in an amount
equal to the Revolving Credit Commitment assumed or acquired by it pursuant to
such Assignment and Acceptance and, if the Assignor has retained a Revolving
Credit Commitment upon request, a new Revolving Credit Note to the order of the
Assignor in an amount equal to the Revolving Credit Commitment retained by it
hereunder. Such new Note or Notes shall be dated the Closing Date and shall
otherwise be in the form of the Note or Notes replaced thereby.

                  (f) For avoidance of doubt, the parties to this Agreement
acknowledge that the provisions of this Section concerning assignments of Loans
and Notes relate only to absolute assignments and that such provisions do not
prohibit assignments creating security interests in Loans and Notes, including,
without limitation, any pledge or assignment by a Lender of any Loan or Note to
any Federal Reserve Bank in accordance with applicable law.

                  (g) Notwithstanding anything to the contrary contained herein,
any Lender (a "Granting Lender") may grant to a special purpose funding vehicle
(an "SPC"), identified as such in writing from time to time by the Granting
Lender to the Administrative Agent and the Borrower, the option to provide to
the Borrower all or any part of any Loan that such Granting Lender would
otherwise be obligated to make to the Borrower pursuant to this Agreement;
provided that (i) nothing herein shall constitute a commitment by any SPC to
make any Loan and (ii) if an SPC elects not to exercise such option or otherwise
fails to provide all or any part of such Loan, the Granting Lender shall be
obligated to make such Loan pursuant to the terms hereof. The making of a Loan
by an SPC hereunder shall utilize the Commitment of the Granting Lender to the
same extent, and as if, such Loan were made by such Granting Lender. Each party
hereto hereby agrees that no SPC shall be liable for any indemnity or similar
payment obligation under this Agreement (all liability for which shall remain
with the Granting Lender). In furtherance of the foregoing, each party hereto
hereby agrees (which agreement shall survive the termination of this Agreement)
that, prior to the date that is one year and one day after the payment in full
of all outstanding commercial paper or other indebtedness of any SPC, it will
not institute against, or join any other person in instituting against, such SPC
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings under the laws of the United States or any state thereof. In
addition, notwithstanding anything to the contrary in this Section 10.6(g), any
SPC may (A) with notice to, but without the prior written consent of, the
Borrower and the Administrative Agent and without paying any processing fee
therefor, assign all or a portion of its interests in any Loans to the Granting
Lender, or with the prior written consent of the Borrower



                                                                              77

and the Administrative Agent (which consent shall not be unreasonably withheld)
to any financial institutions providing liquidity and/or credit support to or
for the account of such SPC to support the funding or maintenance of Loans, and
(B) disclose on a confidential basis any non-public information relating to its
Loans to any rating agency, commercial paper dealer or provider of any surety,
guarantee or credit or liquidity enhancement to such SPC; provided that
non-public information with respect to the Borrower may be disclosed only with
the Borrower's consent which will not be unreasonably withheld. This paragraph
(g) may not be amended without the written consent of any SPC with Loans
outstanding at the time of such proposed amendment.

                  10.7 Adjustments; Set-off. (a) Except to the extent that this
Agreement provides for payments to be allocated to a particular Lender or to the
Lenders under a particular Facility, if any Lender (a "Benefitted Lender") shall
at any time receive any payment of all or part of the Obligations owing to it,
or receive any collateral in respect thereof (whether voluntarily or
involuntarily, by set-off, pursuant to events or proceedings of the nature
referred to in Section 8(f), or otherwise), in a greater proportion than any
such payment to or collateral received by any other Lender, if any, in respect
of such other Lender's Obligations, such Benefitted Lender shall purchase for
cash from the other Lenders a participating interest in such portion of each
such other Lender's Obligations, or shall provide such other Lenders with the
benefits of any such collateral, as shall be necessary to cause such Benefitted
Lender to share the excess payment or benefits of such collateral ratably with
each of the Lenders; provided, however, that if all or any portion of such
excess payment or benefits is thereafter recovered from such Benefitted Lender,
such purchase shall be rescinded, and the purchase price and benefits returned,
to the extent of such recovery, but without interest.

                  (b) In addition to any rights and remedies of the Lenders
provided by law, each Lender shall have the right, without prior notice to
Holdings or the Borrower, any such notice being expressly waived by Holdings and
the Borrower to the extent permitted by applicable law, upon any amount becoming
due and payable by Holdings or the Borrower hereunder (whether at the stated
maturity, by acceleration or otherwise), to set off and appropriate and apply
against such amount any and all deposits (general or special, time or demand,
provisional or final), in any currency, and any other credits, indebtedness or
claims, in any currency, in each case whether direct or indirect, absolute or
contingent, matured or unmatured, at any time held or owing by such Lender or
any branch or agency thereof to or for the credit or the account of Holdings or
the Borrower, as the case may be. Each Lender agrees promptly to notify the
Borrower and the Administrative Agent after any such setoff and application made
by such Lender, provided that the failure to give such notice shall not affect
the validity of such setoff and application.

                  10.8 Counterparts. This Agreement may be executed by one or
more of the parties to this Agreement on any number of separate counterparts,
and all of said counterparts taken together shall be deemed to constitute one
and the same instrument. Delivery of an executed signature page of this
Agreement or of a Lender Addendum by facsimile transmission shall be effective
as delivery of a manually executed counterpart hereof. A set of the copies of
this Agreement signed by all the parties shall be lodged with the Borrower and
the Administrative Agent.

                  10.9 Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such



                                                                              78

prohibition or unenforceability without invalidating the remaining provisions
hereof, and any such prohibition or unenforceability in any jurisdiction shall
not invalidate or render unenforceable such provision in any other jurisdiction.

                  10.10 Integration. This Agreement and the other Loan Documents
represent the entire agreement of Holdings, the Borrower, the Agents, the
Arranger and the Lenders with respect to the subject matter hereof and thereof,
and there are no promises, undertakings, representations or warranties by the
Arranger, any Agent or any Lender relative to subject matter hereof not
expressly set forth or referred to herein or in the other Loan Documents.

                  10.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

                  10.12 Submission To Jurisdiction; Waivers. Each of Holdings
and the Borrower hereby irrevocably and unconditionally:

                  (a) submits for itself and its Property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to which it
is a party, or for recognition and enforcement of any judgment in respect
thereof, to the non-exclusive general jurisdiction of the courts of the State of
New York, the courts of the United States of America for the Southern District
of New York, and appellate courts from any thereof;

                  (b) consents that any such action or proceeding may be brought
in such courts and waives any objection that it may now or hereafter have to the
venue of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;

                  (c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to Holdings
or the Borrower, as the case may be at its address set forth in Section 10.2 or
at such other address of which the Administrative Agent shall have been notified
pursuant thereto;

                  (d) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or shall limit
the right to sue in any other jurisdiction; and

                  (e) waives, to the maximum extent not prohibited by law, any
right it may have to claim or recover in any legal action or proceeding referred
to in this Section any special, exemplary, punitive or consequential damages.

                  10.13 Acknowledgments. Each of Holdings and the Borrower
hereby acknowledges that:

                  (a) it has been advised by counsel in the negotiation,
execution and delivery of this Agreement and the other Loan Documents;



                                                                              79

                  (b) neither the Arranger, any Agent nor any Lender has any
fiduciary relationship with or duty to Holdings or the Borrower arising out of
or in connection with this Agreement or any of the other Loan Documents, and the
relationship between the Arranger, the Agents and the Lenders, on one hand, and
Holdings and the Borrower, on the other hand, in connection herewith or
therewith is solely that of debtor and creditor; and

                  (c) no joint venture is created hereby or by the other Loan
Documents or otherwise exists by virtue of the transactions contemplated hereby
among the Arranger, the Agents and the Lenders or among Holdings, the Borrower
and the Lenders.

                  10.14 Confidentiality. Each of the Agents and the Lenders
agrees to keep confidential all non-public information provided to it by any
Loan Party pursuant to this Agreement that is designated by such Loan Party as
confidential; provided that nothing herein shall prevent any Agent or any Lender
from disclosing any such information (a) to the Arranger, any Agent, any other
Lender or any affiliate of any thereof, (b) to any Participant or Assignee
(each, a "Transferee") or prospective Transferee that agrees in writing to
maintain such information as confidential on terms substantially similar to
those contained in this Section 10.14, (c) to any of its employees, directors,
agents, attorneys, accountants and other professional advisors, (d) to any
financial institution that is a direct or indirect contractual counterparty in
swap agreements or such contractual counterparty's professional advisor (so long
as such contractual counterparty or professional advisor to such contractual
counterparty agrees to be bound by the provisions of this Section), (e) upon the
request or demand of any Governmental Authority having jurisdiction over it, (f)
in response to any order of any court or other Governmental Authority or as may
otherwise be required pursuant to any Requirement of Law, (g) in connection with
any litigation or similar proceeding, (h) that has been publicly disclosed other
than in breach of this Section, (i) to the National Association of Insurance
Commissioners or any similar organization or any nationally recognized rating
agency that requires access to information about a Lender's investment portfolio
in connection with ratings issued with respect to such Lender or (j) in
connection with the exercise of any remedy hereunder or under any other Loan
Document.

                  10.15 Release of Collateral and Guarantee Obligations.

                  (a) Notwithstanding anything to the contrary contained herein
or in any other Loan Document, upon request of the Borrower in connection with
any Disposition of Property permitted by the Loan Documents, the Administrative
Agent shall (without notice to, or vote or consent of, any Lender, or any
affiliate of any Lender that is a party to any Specified Hedge Agreement) take
such actions as shall be required to release its security interest in any
Collateral being Disposed of in such Disposition, and to release any guarantee
obligations under any Loan Document of any Person being Disposed of in such
Disposition, to the extent necessary to permit consummation of such Disposition
in accordance with the Loan Documents.

                  (b) Notwithstanding anything to the contrary contained herein
or any other Loan Document, when all Obligations (other than obligations in
respect of any Specified Hedge Agreement) have been paid in full, all
Commitments have terminated or expired and no Letter of Credit shall be
outstanding, upon request of the Borrower, the Administrative Agent shall
(without notice to, or vote or consent of, any Lender, or any affiliate of any
Lender that is a party to any Specified Hedge Agreement) take such actions as
shall be required to release its security interest in



                                                                              80

all Collateral, and to release all guarantee obligations under any Loan
Document, whether or not on the date of such release there may be outstanding
Obligations in respect of Specified Hedge Agreements. Any such release of
guarantee obligations shall be deemed subject to the provision that such
security interests and guarantee obligations shall automatically be reinstated
if after such release any portion of any payment in respect of the Obligations
guaranteed thereby shall be rescinded or must otherwise be restored or returned
upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of
the Borrower or any Guarantor, or upon or as a result of the appointment of a
receiver, intervenor or conservator of, or trustee or similar officer for, the
Borrower or any Guarantor or any substantial part of its property, or otherwise,
all as though such payment had not been made.

                  (c) Notwithstanding anything to the contrary contained herein
or in any other Loan Document, upon the request of the Borrower the
Administrative Agent shall (without notice to, or vote or consent of, any
Lender, or any affiliate of any Lender that is party to any Specified Hedge
Agreement) take such actions as shall be required to release its interest in one
or more Existing Mortgages securing facilities operating up to an aggregate of
750 licensed skilled nursing beds and/or assisted living facility units in order
to permit the Disposition of such facilities or the incurrence of Permitted
Non-Recourse Debt in respect of such facility.

                  10.16 Accounting Changes. In the event that any "Accounting
Change" (as defined below) shall occur and such change results in a change in
the method of calculation of financial covenants, standards or terms in this
Agreement, then the Borrower and the Administrative Agent agree to enter into
negotiations in order to amend such provisions of this Agreement so as to
equitably reflect such Accounting Change with the desired result that the
criteria for evaluating the Borrower's financial condition shall be the same
after such Accounting Change as if such Accounting Change had not been made.
Until such time as such an amendment shall have been executed and delivered by
the Borrower, the Administrative Agent and the Required Lenders, all financial
covenants, standards and terms in this Agreement shall continue to be calculated
or construed as if such Accounting Change had not occurred. "Accounting Change"
refers to any change in accounting principles required by the promulgation of
any rule, regulation, pronouncement or opinion by the Financial Accounting
Standards Board of the American Institute of Certified Public Accountants or, if
applicable, the SEC.

                  10.17 Delivery of Lender Addenda. Each initial Lender shall
become a party to this Agreement by delivering to the Administrative Agent a
Lender Addendum duly executed by such Lender, the Borrower and the
Administrative Agent. Execution and delivery by a Lender, LCPI, the
Administrative Agent and the Borrower of a Lender Addendum shall constitute the
assignment by LCPI to such Lender, and the acquisition by such Lender, effective
on the Closing Date, of the amount of the Revolving Credit Commitment set forth
in such Lender Addendum, whereupon such Lender shall be a Lender hereunder
having the Revolving Credit Commitment set forth in such Lender Addendum.

                  10.18 WAIVERS OF JURY TRIAL. HOLDINGS, THE BORROWER, THE
AGENTS AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY
JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.


                                                                              81


                  IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their proper and duly authorized
officers as of the day and year first above written.

                                         EXTENDICARE HOLDINGS, INC.


                                  By: /s/ Richard L. Bertrand
                                      ------------------------------------
                                      Name: Richard L. Bertrand
                                      Title: Senior Vice President - Development


                                  EXTENDICARE HEALTH SERVICES, INC.

                                  By: /s/ Richard L. Bertrand
                                      ------------------------------------
                                      Name: Richard L. Bertrand
                                      Title: Senior Vice President - Development


                                      LEHMAN BROTHERS INC.,
                                      as Arranger


                                  By: /s/ Francis J. Chang
                                      ------------------------------------
                                      Name: Francis J. Chang
                                      Title: Vice President


                                      LEHMAN COMMERCIAL PAPER INC.,
                                      as Administrative Agent


                                  By: /s/ Francis J. Chang
                                      ------------------------------------
                                      Name: Francis J. Chang
                                      Title: Vice President



                                                                         Annex A


                                  PRICING GRID



- --------------------------------------------------------------------------------------------------------------
                                                      APPLICABLE MARGIN -         APPLICABLE MARGIN - BASE
      CONSOLIDATED SENIOR LEVERAGE RATIO             EURODOLLAR RATE LOANS               RATE LOANS
- --------------------------------------------------------------------------------------------------------------
                                                                            
                > 3.50 to 1.0                               4.00%                          3.00%
- --------------------------------------------------------------------------------------------------------------
> 2.75 to 1.0 but less than or equal to 3.50 to 1.0         3.75%                          2.75%
- --------------------------------------------------------------------------------------------------------------
> 2.25 to 1.0 but less than or equal to 2.75 to 1.0         3.50%                          2.50%
- --------------------------------------------------------------------------------------------------------------
> 1.75 to 1.0 but less than or equal to 2.25 to 1.0         3.25%                          2.25%
- --------------------------------------------------------------------------------------------------------------
      less than or equal to 1.75 to 1.0                     3.00%                          2.00%
- --------------------------------------------------------------------------------------------------------------


Changes in the Applicable Margin resulting from changes in the Consolidated
Senior Leverage Ratio shall become effective on the date (the "Adjustment Date")
on which financial statements are delivered to the Lenders pursuant to Section
6.1 (but in any event not later than the 45th day after the end of each of the
first three quarterly periods of each fiscal year or the 90th day after the end
of each fiscal year, as the case may be) and shall remain in effect until the
next change to be effected pursuant to this paragraph. If any financial
statements referred to above are not delivered within the time periods specified
above, then, until such financial statements are delivered, Consolidated Senior
Leverage Ratio as at the end of the fiscal period that would have been covered
thereby shall for the purposes of this definition be deemed to be greater than
3.50 to 1.0. Each determination of the Consolidated Senior Leverage Ratio
pursuant to this Pricing Grid shall be made for the periods and in the manner
contemplated by Section 7.1(a).

EX-5

                                                                       EXHIBIT 5


                                           [FOLEY LARDNER ATTORNEYS AT LAW LOGO]

BRUSSELS
CHICAGO
DENVER
DETROIT
JACKSONVILLE
LOS ANGELES
MADISON
MILWAUKEE
ORLANDO
SACRAMENTO
SAN DIEGO/DEL MAR
SAN FRANCISCO
TALLAHASSEE
TAMPA
WASHINGTON, D.C.
WEST PALM BEACH
                                  July 29, 2002


Extendicare Health Services, Inc
Subsidiary Guarantors Set Forth in Exhibit A Hereto
111 West Michigan Street
Milwaukee, WI 53202

Ladies and Gentlemen:

     We have acted as counsel for Extendicare Health Services, Inc., a Wisconsin
corporation (the "Company"), and the subsidiaries of the Company set forth in
Exhibit A hereto (the "Subsidiary Guarantors"), in connection with the
preparation of a Registration Statement on Form S-4, including the Prospectus
constituting a part thereof (the "Registration Statement"), to be filed with the
Securities and Exchange Commission under the Securities Act of 1933, as amended
(the "Securities Act"), relating to an offer to exchange (the "Exchange Offer")
the Company's new 9 1/2% Senior Notes due 2010 (the "New Notes") for an equal
principal amount of the Company's outstanding 9 1/2% Notes due 2010 (the "Old
Notes"). The New Notes will be fully and unconditionally guaranteed (the "New
Note Guarantees") by the Subsidiary Guarantors.

     The Old Notes were issued, and the New Notes will be issued, pursuant to an
Indenture, dated as of June 28, 2002 (the "Indenture"), among the Company, the
Subsidiary Guarantors and U.S. Bank N.A., as Trustee (the "Trustee").

     In connection with our opinion, we have examined: (a) the Registration
Statement, including the Prospectus; (b) the Indenture; (c) the form of the New
Notes and the New Note Guarantees; and (d) such other proceedings, documents and
records as we have deemed necessary to enable us to render this opinion.

     In our examination of the above referenced documents, we have assumed the
genuineness of all signatures, the authenticity of all documents, certificates
and instruments submitted to us as originals and the conformity with the
originals of all documents submitted to us as copies.

FOLEY & LARDNER                                             CLIENT/MATTER NUMBER
777 EAST WISCONSIN AVENUE, SUITE 3800                       089775-0107
MILWAUKEE, WISCONSIN 53202-5367

TEL: 414.271.2400                                           001.1267033.1
FAX: 414.297.4900
WWW.FOLEYLARDNER.COM





[FOLEY LARDNER LOGO]

Extendicare Health Services, Inc.
Subsidiary Guarantors Set Forth
  in Exhibit A Hereto
July 29, 2002
Page 2


     Based upon the foregoing, assuming that the Indenture has been duly
authorized, executed and delivered by, and represents the valid and binding
obligation of, the Trustee, and when the Registration Statement, including any
amendments thereto, shall have become effective under the Securities Act and the
Indenture shall have been duly qualified under the Trust Indenture Act of 1939,
as amended, and having regard for such legal considerations as we deem relevant,
we are of the opinion that:

     1. The New Notes, when duly executed and delivered by or on behalf of the
Company in the form contemplated by the Indenture upon the terms set forth in
the Exchange Offer and authenticated by the Trustee, will be legally issued and
valid and binding obligations of the Company enforceable in accordance with
their terms; and

     2. The New Note Guarantees, when duly executed and delivered by or on
behalf of the Subsidiary Guarantors in the form contemplated by the Indenture
upon the terms set forth in the Exchange Offer, will be legally issued and valid
and binding obligations of the Subsidiary Guarantors enforceable in accordance
with their terms;

except, in each case, as enforcement thereof may be limited by bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium or other similar
laws relating to or affecting creditors' rights and remedies generally or the
application of general principles of equity, including principles of commercial
reasonableness, good faith and fair dealing (regardless of whether enforcement
is sought in a proceeding in equity or at law).

     We hereby consent to the reference to our firm under the caption "Legal
Matters" in the Prospectus which is filed as part of the Registration Statement,
and to the filing of this opinion as an exhibit to such Registration Statement.
In giving this consent, we do not admit that we are "experts" within the meaning
of Section 11 of the Securities Act or within the category of persons whose
consent is required by Section 7 of the Securities Act.

                                         Very truly yours,



                                         /s/ FOLEY & LARDNER







Adult Services Unlimited, Inc.
Alpine Health and Rehabilitation Center, LLC
Arbors at Bayonet Point, LLC
Arbors at Fairlawn Care, LLC
Arbors at Fairlawn Realty OH, LLC
Arbors at Sylvania Care, LLC
Arbors at Sylvania Realty OH, LLC
Arbors at Tampa, LLC
Arbors at Toledo, Inc.
Arbors East, Inc.
Arbors West Care, LLC
Arbors West Realty OH, LLC
Blanchester Care, LLC
Canton Care, LLC
Colonial Care, LLC
Columbus Rehabilitation Care, LLC
Columbus Rehabilitation Realty OH, LLC
Concordia Manor, LLC
Coventry Care Holdings, Inc.
Coventry Care, Inc.
Dayton Care, LLC
Delaware Care, LLC
Edgewood Care, LP
Edgewood Nursing Center, Inc.
Eldercrest Care, LP
Elder Crest, Inc.
Extendicare Great Trail, Inc.
Extendicare Health Facilities, Inc.
Extendicare Health Facility Holdings, Inc.
Extendicare Health Network, Inc.
Extendicare Homes, Inc.
Extendicare of Indiana, Inc.
Fir Lane Terrace Convalescent Center, Inc.
First Coast Health and Rehabilitation Center, LLC
Fiscal Services Group, LLC
Gallipolis Care, LLC
Great Trail Care, LLC
Greenbriar Care, LLC
Greenbrook Care, LLC
Haven Care, LP
Haven Crest, Inc.
Health Poconos, Inc.
Heritage Care, LLC
Hilliard Care, LLC



Indiana Health and Rehabilitation Centers
Jackson Heights Rehabilitation Center, LLC
Jacksonville Care, LLC
Kaufman Street, WV, LLC
Kissimmee Care, LLC
Lady Lake Care, LLC
London Care, LLC
Marietta Care, LLC
Marshall Properties, Inc.
Meadow Care, LP
Meadow Crest, Inc.
Milford Care, LLC
New Castle Care, LLC
New Horizon Care, LLC
North Rehabilitation Care, LLC
Northern Health Facilities, Inc.
Oak Hill Care, LP
Oak Hill Home of Rest and Care, Inc.
Orange Park Care, LLC
Oregon Care, LLC
Palm Court Care, LLC
Partners Health Group - Florida, LLC
Partners Health Group - Louisiana, LLC
Partners Health Group - Texas, LLC
Partners Health Group, LLC
Port Charlotte Care, LLC
Richey Manor, LLC
Rockledge Care, LLC
Rockmill Care, LLC
Rocksprings Care, LLC
Safety Harbor Care, LLC
Sarasota Care, LLC
Seminole Care, LLC
South Heritage Health and Rehabilitation Center, LLC
Stonebridge Care, LP
The Oaks Residential and Rehabilitation Center, LLC
The Progressive Step Corporation
Treasure Isle Care Center, LLC
United Professional Services, Inc.
Waterville Care, LLC
Winter Haven Care, LLC
Winter Haven Health and Rehabilitation Center, LLC
Woodsfield Care, LLC




                                       2

EX-12

                                                                      EXHIBIT 12

                        EXTENDICARE HEALTH SERVICES INC.
                      EARNINGS TO FIXED CHARGE CALCULATION


                                                        PROFORMA
                                                 ----------------------      ACTUAL FOR THREE
                                                 3 months     12 months         MONTHS ENDED
                                                   ended        ended       -------------------
                                                  Mar. 31      Dec. 31      Mar. 31     Mar. 31
                                                    2002        2001         2002        2001
                                                 --------     ---------     -------     -------
                                                                           
EARNINGS FROM CONTINUING OPERATIONS
Earnings before extraordinary items, taxes
   and minority interest                           1,613       (45,360)       2,970     (10,430)
Add:   Fixed charges                              11,046        49,815        9,689      11,993
       Amortization of interest capitalized            -             -            -           -
Less:  Interest capitalized                            -             -            -           -
                                                 -------       -------       -------    -------
EARNINGS                                          12,659         4,455       12,659       1,563
                                                 =======       =======       =======    =======
FIXED CHARGES
  Interest expense (including amortization
    of deferred financing charges)                 9,687        43,285        8,330      10,283
  Interest capitalized                                 -             -            -           -
Estimate of interest within rental expense         1,359         6,530        1,359       1,710
                                                 -------       -------       -------    -------
TOTAL FIXED CHARGES                               11,046        49,815        9,689      11,993
                                                 =======       =======       =======    =======

EARNINGS TO FIXED CHARGES RATIO                     1.15          0.09         1.31        0.13
                                                 -------       -------       -------    -------
DOLLAR AMOUNT OF THE DEFICIENCY                       na        45,360           na      10,430
  (if less than 1:1 ratio)
ESTIMATE OF INTEREST WITHIN RENT EXPENSE:
      Rental expense                               3,034        14,575        3,034       3,817
      Multiplier                                       8             8            8           8
                                                 -------       -------       -------    -------
      Value of rented equipment/assets            24,272       116,600       24,272      30,536
      Equity assumed at 20%                        4,854        23,320        4,854       6,107
      Debt of Lessor                              19,418        93,280       19,418      24,429
      Estimated interest rate                       7.0%          7.0%         7.0%        7.0%
                                                 -------       -------       -------    -------
      Estimated interest expense in rent           1,359         6,530        1,359       1,710
                                                 =======       =======       =======    =======
PROFORMA IMPACT OF DEBT OFFERING
      Interest expense as reported                 8,330        37,857
      Incremental interest expense                 1,357         5,428
                                                 -------       -------
      Proforma interest expense                    9,687        43,285
                                                 =======       =======
      Earnings as reported                         2,970       (39,932)
      Incremental interest expense                (1,357)       (5,428)
                                                 -------       -------
      Proforma earnings                            1,613       (45,360)
                                                 =======       =======



                                                                       ACTUAL FOR 12 MONTHS ENDED
                                                   ------------------------------------------------------------------
                                                   Mar. 31     Dec. 31    Dec. 31      Dec. 31    Dec. 31     Dec. 31
                                                     2002       2001       2000          1999      1998         1997
                                                   -------     -------    -------      -------    -------     -------
                                                                                                
EARNINGS FROM CONTINUING OPERATIONS
Earnings before extraordinary items, taxes
   and minority interest                           (26,532)   (39,932)    (82,346)    (123,180)   109,252      59,130
Add:   Fixed charges                                42,083     44,387      53,588       60,251     66,175      30,919
       Amortization of interest capitalized              -          -           -            -          -           -
Less:  Interest capitalized                              -          -           -         (301)    (1,099)       (825)
                                                   -------    -------     -------      -------    -------    --------
EARNINGS                                            15,551      4,455     (28,758)     (63,230)   174,328      89,224
                                                   =======    =======     =======      =======    =======    ========
FIXED CHARGES
  Interest expense (including amortization
    of deferred financing charges)                  35,904     37,857      46,541       52,499     57,955      25,519
  Interest capitalized                                   -          -           -          301      1,099         825
Estimate of interest within rental expense           6,179      6,530       7,047        7,451      7,121       4,575
                                                   -------    -------     -------      -------    -------    --------
TOTAL FIXED CHARGES                                 42,083     44,387      53,588       60,251     66,175      30,919
                                                   =======    =======     =======      =======    =======    ========

EARNINGS TO FIXED CHARGES RATIO                       0.37       0.10       (0.54)       (1.05)      2.63        2.89
                                                   -------    -------     -------      -------    -------    --------
DOLLAR AMOUNT OF THE DEFICIENCY                     26,532     39,932      82,346      123,481         na          na
  (if less than 1:1 ratio)
ESTIMATE OF INTEREST WITHIN RENT EXPENSE:
      Rental expense                                13,792     14,575      15,731       16,631     15,895      10,213
      Multiplier                                         8          8           8            8          8           8
                                                   -------    -------     -------      -------    -------    --------
      Value of rented equipment/assets             110,336    116,600     125,848      133,048    127,160      81,704
      Equity assumed at 20%                         22,067     23,320      25,170       26,610     25,432      16,341
      Debt of Lessor                                88,269     93,280     100,678      106,438    101,728      65,363
      Estimated interest rate                         7.0%       7.0%        7.0%         7.0%       7.0%        7.0%
                                                   -------    -------     -------      -------    -------    --------
      Estimated interest expense in rent             6,179      6,530       7,047        7,451      7,121       4,575
                                                   =======    =======     =======      =======    =======    ========
PROFORMA IMPACT OF DEBT OFFERING
      Interest expense as reported
      Incremental interest expense

      Proforma interest expense

      Earnings as reported
      Incremental interest expense

      Proforma earnings

EX-23.1

                                                                    Exhibit 23.1

                         INDEPENDENT AUDITORS' CONSENT


The Board of Directors
Extendicare Health Services, Inc.

We consent to the use of our reports included herein and to the reference to
our firm under the heading "Experts" in the prospectus.


/s/ KPMG

Milwaukee, Wisconsin
July 26, 2002

EX-25

                                                                      EXHIBIT 25

================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                           --------------------------

                                    FORM T-1

                         STATEMENT OF ELIGIBILITY UNDER
                      THE TRUST INDENTURE ACT OF 1939 OF A
                    CORPORATION DESIGNATED TO ACT AS TRUSTEE
               Check if an Application to Determine Eligibility of
                   a Trustee Pursuant to Section 305(b)(2) ___
             -------------------------------------------------------

                         U.S. BANK NATIONAL ASSOCIATION
               (Exact name of Trustee as specified in its charter)

                                   31-0841368
                       I.R.S. Employer Identification No.

- ----------------------------------------              ----------------
         601 Second Avenue South                           55402
             Minneapolis, MN
- ----------------------------------------              ----------------
(Address of principal executive offices)                 (Zip Code)
- ----------------------------------------              ----------------

                                 Steve Peterson
                         U.S. Bank National Association
                            1555 N. RiverCenter Drive
                               Milwaukee, WI 53212
                                 (414) 905-5010
            (Name, address and telephone number of agent for service)

                        EXTENDICARE HEALTH SERVICES, INC.
               (Exact name of obligor as specified in its charter)

- ----------------------------------------    ------------------------------------
               Delaware                                 98-0066268
- ----------------------------------------    ------------------------------------
- ----------------------------------------    ------------------------------------
   (State or other jurisdiction of          (I.R.S. Employer Identification No.)
    incorporation or organization)
- ----------------------------------------    ------------------------------------
- ----------------------------------------    ------------------------------------
       111 West Michigan Street                           53203
           Milwaukee, WI
- ----------------------------------------    ------------------------------------
(Address of Principal Executive Offices)                (Zip Code)
- ----------------------------------------    ------------------------------------

                          9 1/2% SENIOR NOTES DUE 2010
                       (Title of the indenture securities)

 ==============================================================================







                                    FORM T-1


ITEM 1.      GENERAL INFORMATION.  Furnish the following information as to the
             Trustee.

             a)   Name and address of each examining or supervising authority to
                  which it is subject.
                        Comptroller of the Currency
                        Washington, D.C.

             b)   Whether it is authorized to exercise corporate trust powers.
                        Yes

ITEM 2.      AFFILIATIONS WITH OBLIGOR.  If the obligor is an affiliate of the
             Trustee, describe each such affiliation.
                  None

ITEMS 3-15        Items 3-15 are not applicable because to the best of the
                  Trustee's knowledge, the obligor is not in default under any
                  Indenture for which the Trustee acts as Trustee.

ITEM 16.     LIST OF EXHIBITS:  List below all exhibits filed as a part of this
             statement of eligibility and qualification.

             1.   A copy of the articles of association of the Trustee now in
                  effect.*

             2.   A copy of the certificate of authority of the Trustee to
                  commence business.*

             3.   A copy of the certificate of authority of the Trustee to
                  exercise corporate trust powers.*

             4.   A copy of the existing bylaws of the Trustee now in effect.*

             5.   Not applicable.

             6.   The consent of the Trustee required by Section 321(b) of the
                  Trust Indenture Act of 1939, attached as Exhibit 6.

             7.   Report of Condition of the Trustee as of March 31, 2002,
                  published pursuant to law or the requirements of its
                  supervising or examining authority, attached as Exhibit 7.

             8.   Not applicable.

             9.   Not applicable.


       * Incorporated by reference to Registration Number 333-67188.


                                       2




                                    SIGNATURE

         Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the Trustee, U.S. BANK NATIONAL ASSOCIATION, a national banking
association organized and existing under the laws of the United States of
America, has duly caused this statement of eligibility to be signed on its
behalf by the undersigned, thereunto duly authorized, all in the City of
Milwaukee, State of Wisconsin on the 25th day of July, 2002.


                                     U.S. BANK NATIONAL ASSOCIATION

                                     By:      /s/ Steven J. Peterson
                                              ----------------------------------
                                              Steven J. Peterson
                                              Trust Officer




By:      /s/ Peter M. Brennan
         --------------------
         Peter M. Brennan
         Assistant Vice President






                                       3




                                                                       EXHIBIT 6

                                     CONSENT


         In accordance with Section 321(b) of the Trust Indenture Act of 1939,
the undersigned, U.S. BANK NATIONAL ASSOCIATION hereby consents that reports of
examination of the undersigned by Federal, State, Territorial or District
authorities may be furnished by such authorities to the Securities and Exchange
Commission upon its request therefor.


Dated:  July 25, 2002


                                    U.S. BANK NATIONAL ASSOCIATION


                                    By:      /s/ Steven J. Peterson
                                             -----------------------------------
                                             Steven J. Peterson
                                             Trust Officer




By:      /s/ Peter M. Brennan
         --- ----------------------------
         Peter M. Brennan
         Assistant Vice President


                                       4




                                                                       EXHIBIT 7
                         U.S. BANK NATIONAL ASSOCIATION
                        STATEMENT OF FINANCIAL CONDITION
                                 AS OF 3/31/2002

                                    ($000'S)


                                                                          3/31/2002
                                                                        ------------
                                                                     
ASSETS
     Cash and Due From Depository Institutions                            $6,610,097
     Federal Reserve Stock                                                         0
     Securities                                                           24,432,814
     Federal Funds                                                         1,509,430
     Loans & Lease Financing Receivables                                 112,081,360
     Fixed Assets                                                          1,414,464
     Intangible Assets                                                     8,269,267
     Other Assets                                                          6,637,699
                                                                        ------------
         TOTAL ASSETS                                                   $160,955,131

LIABILITIES
     Deposits                                                           $107,406,480
     Fed Funds                                                             6,981,749
     Treasury Demand Notes                                                         0
     Trading Liabilities                                                     120,375
     Other Borrowed Money                                                 18,019,329
     Acceptances                                                             185,399
     Subordinated Notes and Debentures                                     5,104,491
     Other Liabilities                                                     3,878,626
                                                                        ------------
     TOTAL LIABILITIES                                                  $141,696,449

EQUITY
     Minority Interest in Subsidiaries                                      $985,901
     Common and Preferred Stock                                               18,200
     Surplus                                                              11,278,504
     Undivided Profits                                                     6,976,077
                                                                        ------------
         TOTAL EQUITY CAPITAL                                            $19,258,682

TOTAL LIABILITIES AND EQUITY CAPITAL                                    $160,955,131



To the best of the undersigned's determination, as of the date hereof, the above
financial information is true and correct.

U.S. BANK NATIONAL ASSOCIATION

By:      /s/ Steven  J. Peterson
         --------------------------
         Trust Officer
Date:  July 25, 2002

                                       5

EX-99.1

                                                                    EXHIBIT 99.1

               EXTENDICARE HEALTH SERVICES, INC. AND SUBSIDIARIES

                  SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS
                                 (IN THOUSANDS)





                                                            ADDITIONS            SUBTRACTIONS
                                                  -----------------------------  ------------
                                                   PROVISIONS
                                                   FOR LOSSES           FROM                            ACCOUNTS
                                    BALANCE AT         ON           ACQUISITION                       WRITTEN OFF         BALANCE
           ALLOWANCE FOR            BEGINNING       ACCOUNTS            OR            FROM              NET OF             AT END
        DOUBTFUL ACCOUNTS           OF PERIOD      RECEIVABLE       DIVESTITURE   DIVESTITURE         RECOVERIES         OF PERIOD
        -----------------           ---------      ----------       -----------   -----------         ----------         ---------
                                                                                                       
Year ended December 31, 1997....      9,303           8,111             8,326             --              6,814            18,926
Year ended December 31, 1998....     18,926          12,698             4,683          2,724              7,684            25,899
Year ended December 31, 1999....     25,899          11,905                --             --             12,855            24,949
Year ended December 31, 2000....     24,949          17,945             2,367             --             28,932            16,329
Year ended December 31, 2001....     16,329           8,945             3,515             --             14,212            14,577










                          INDEPENDENT AUDITORS' REPORT




The Board of Directors
Extendicare Health Services, Inc.:

On February 6, 2002 we reported on the consolidated balance sheets of
Extendicare Health Services, Inc. and subsidiaries (the Company) as of December
31, 2001 and 2000, and the related consolidated statements of operations,
shareholder's equity, and cash flows for each of the years in the three-year
period ended December 31, 2001, which are included in the Company's 2001 Annual
Report on Form 10-K. In connection with our audits of the aforementioned
consolidated financial statements, we also audited the related financial
statement schedule as listed in Item 21. The financial statement schedule is the
responsibility of the Company's management. Our responsibility is to express an
opinion on the financial statement schedule based on our audits.

In our opinion, such financial statement schedule, when considered in relation
to the basic consolidated financial statements taken as a whole, presents
fairly, in all material respects, the information set forth therein.

/s/  KPMG LLP

Milwaukee, Wisconsin
February 6, 2002

EX-99.2

                                                                    EXHIBIT 99.2

                              LETTER OF TRANSMITTAL

                        EXTENDICARE HEALTH SERVICES, INC.

                               OFFER TO EXCHANGE
                    REGISTERED 9 1/2% SENIOR NOTES DUE 2010
                          FOR ANY AND ALL OUTSTANDING
                   UNREGISTERED 9 1/2% SENIOR NOTES DUE 2010
               PURSUANT TO THE PROSPECTUS DATED ___________, 2002


       THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M. NEW YORK CITY TIME, ON
       ___________________, 2002, UNLESS EXTENDED (THE "EXPIRATION DATE").


                  The Exchange Agent for the Exchange Offer is:

                                 U.S. Bank, N.A.


      By Facsimile Transmission
      -------------------------               By Registered or Certified Mail,
  (For Eligible Institutions Only):              Hand or Overnight Courier:
            (651) 244-1537                       --------------------------
                                                  U.S. Bank Trust Center
        Confirm by Telephone:                      180 East Fifth Street
        --------------------                         St. Paul, MN 55101
            (800) 934-6802                  Attention: Specialized Finance Group





         DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE, OR TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE OTHER THAN AS SET
FORTH ABOVE, WILL NOT CONSTITUTE A VALID DELIVERY.

         PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY BEFORE COMPLETING
THIS LETTER OF TRANSMITTAL.

         The undersigned acknowledges that he or she has received and reviewed
the Prospectus, dated ______________, 2002 (the "Prospectus"), of Extendicare
Health Services, Inc., a Delaware corporation (the "Company"), and certain of
its direct and indirect subsidiaries, and this Letter of Transmittal (the
"Letter"), which together constitute the Company's offer (the "Exchange Offer")
to exchange its 9 1/2% Senior Notes due 2010 (the "New Notes"), which have been
registered under the Securities Act of 1933, as amended (the "Securities Act"),
for a like principal amount of the Company's issued and outstanding unregistered
9 1/2% Senior Notes due 2010 (the "Old Notes").

         For each Old Note accepted for exchange, the Holder of such Old Note
will receive a New Note having a principal amount equal to that of the
surrendered Old Note. The New Notes will bear interest from the most recent date
to which interest has been paid on the Old Notes or, if no interest has been
paid on the Old Notes, from June 28, 2002. Accordingly, registered Holders of
New Notes on the relevant record date for the first interest payment date
following the consummation of the Exchange Offer will receive interest accrued
from the most recent date to which interest has been paid or, if no interest has
been paid, from June 28, 2002. However, if that record date occurs prior to
completion of the Exchange Offer, then the interest payable on the first
interest payment date following



                                       1




the completion of the Exchange Offer will be paid to the registered Holders of
the Old Notes on that record date. Old Notes accepted for exchange will cease to
accrue interest from and after the date of consummation of the Exchange Offer
and will be cancelled. Holders of Old Notes whose Old Notes are accepted for
exchange will not receive any payment in respect of accrued interest on such Old
Notes otherwise payable on any interest payment date the record date for which
occurs on or after consummation of the Exchange Offer.

         This Letter is to be completed by a Holder of Old Notes either if (1)
certificates are to be forwarded herewith or (2) tenders are to be made by
book-entry transfer to the account maintained by the Exchange Agent at The
Depository Trust Company ("DTC" or the "Book-Entry Transfer Facility") pursuant
to the procedures set forth in "The Exchange Offer -- Book-Entry Transfer"
section of the Prospectus. Holders of Old Notes whose certificates are not
immediately available, or who are unable to deliver their certificates or
confirmation of the book-entry tender of their Old Notes into the Exchange
Agent's account at the Book-Entry Transfer Facility (a "Book-Entry
Confirmation") and all other documents required by this Letter to the Exchange
Agent on or prior to the Expiration Date, must tender their Old Notes according
to the guaranteed delivery procedures set forth in "The Exchange Offer -
Guaranteed Delivery Procedures" section of the Prospectus. See Instruction 1.
Delivery of documents to the Book-Entry Transfer Facility does not constitute
delivery to the Exchange Agent.

         Tenders by book-entry transfer also may be made by delivering an
Agent's Message in lieu of this Letter. The term "Agent's Message" means a
message, transmitted by the Book-Entry Transfer Facility to and received by the
Exchange Agent and forming a part of a Book-Entry Confirmation, which states
that the Book-Entry Transfer Facility has received an express acknowledgment
from the tendering participant, which acknowledgment states that such
participant has received and agrees to be bound by this Letter and the Company
may enforce this Letter against such participant.

         As used in this Letter, the term "Holder" with respect to the Exchange
Offer means any person in whose name Old Notes are registered on the books of
the Company or, with respect to interests in global notes held by DTC, any DTC
participant listed in an official DTC proxy. The undersigned has completed the
appropriate boxes below and signed this Letter to indicate the action the
undersigned desires to take with respect to the Exchange Offer.




                                       2








         List below the Old Notes to which this Letter relates. If the space
provided below is inadequate, the certificate numbers and principal amount of
Old Notes should be listed on a separate signed schedule affixed hereto.





- ---------------------------------------------------------------------------------------------------------------
                                     DESCRIPTION OF OLD NOTES TENDERED
- ---------------------------------------------------------------------------------------------------------------
                                                                                   
            NAME(S) AND ADDRESS(ES) OF                                AGGREGATE
               REGISTERED HOLDER(S)            CERTIFICATE         PRINCIPAL AMOUNT         PRINCIPAL AMOUNT
            (PLEASE FILL IN, IF BLANK)          NUMBER(S)*            OF OLD NOTES             TENDERED**
- ---------------------------------------------------------------------------------------------------------------


- ---------------------------------------------------------------------------------------------------------------


- ---------------------------------------------------------------------------------------------------------------


- ---------------------------------------------------------------------------------------------------------------


- ---------------------------------------------------------------------------------------------------------------


- ---------------------------------------------------------------------------------------------------------------
                                                 Total
- ---------------------------------------------------------------------------------------------------------------


*    Do not complete if Old Notes are being tendered by book-entry transfer.

**   A holder will be deemed to have tendered ALL Old Notes unless a lesser
     amount is specified in this column. See Instruction 2. Old Notes tendered
     hereby must be in denominations of principal amount of $1,000 and any
     integral multiples thereof. See Instruction 1.

|_|  CHECK HERE IF TENDERED OLD NOTES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
     MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH THE BOOK-ENTRY
     TRANSFER FACILITY AND COMPLETE THE FOLLOWING:

     Name of Tendering Institution
                                   ---------------------------------------------
     Account Number              Transaction Code Number
                   -----------                           -----------------------

|_|  CHECK HERE IF TENDERED OLD NOTES ARE BEING DELIVERED PURSUANT TO A NOTICE
     OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT AND COMPLETE
     THE FOLLOWING:

     Name(s) of Registered Holder(s)
                                    -------------------------------------------
     Window Ticket Number (if any)
                                   --------------------------------------------
     Date of Execution of Notice of Guaranteed Delivery
                                                       ------------------------
     Name of Institution Which Guaranteed Delivery
                                                   ----------------------------
     If Delivered by Book-Entry Transfer, Complete the Following:
     Account Number                     Transaction Code Number
                   --------------------                         ---------------

|_|  CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10 ADDITIONAL
     COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS
     THERETO.
     Name:
           ---------------------------------------------------------------------
     Address:
              ------------------------------------------------------------------




                                       3







                     NOTE: SIGNATURES MUST BE PROVIDED BELOW
               PLEASE READ CAREFULLY THE ACCOMPANYING INSTRUCTIONS

Ladies and Gentlemen:

         Upon the terms and subject to the conditions of the Exchange Offer, the
undersigned hereby tenders to the Company the aggregate principal amount of Old
Notes indicated on page 3 of this Letter. Subject to, and effective upon, the
acceptance for exchange of the Old Notes tendered hereby, the undersigned hereby
sells, assigns and transfers to, or upon the order of, the Company all right,
title and interest in and to such Old Notes as are being tendered hereby.

         The undersigned hereby irrevocably constitutes and appoints the
Exchange Agent as the undersigned's true and lawful agent and attorney-in-fact
with respect to such tendered Old Notes, with full power of substitution, among
other things, to cause the Old Notes to be assigned, transferred and exchanged.
The undersigned hereby represents and warrants that the undersigned has full
power and authority to tender, sell, assign and transfer the Old Notes, and to
acquire the New Notes issuable upon the exchange of such tendered Old Notes, and
that, when the same are accepted for exchange, the Company will acquire good and
unencumbered title thereto, free and clear of all liens, restrictions, charges
and encumbrances and not subject to any adverse claim when the same are accepted
by the Company. The undersigned hereby further represents that: (1) any New
Notes acquired in exchange for Old Notes tendered hereby will have been acquired
in the ordinary course of business of the person receiving such New Notes,
whether or not such person is the undersigned, (2) neither the Holder of such
Old Notes nor any such other person has an arrangement or understanding with any
person to participate in the distribution of such New Notes, and (3) neither the
Holder of such Old Notes or any such other person is an "affiliate," as defined
in Rule 405 under the Securities Act, of the Company.

         The undersigned acknowledges that this Exchange Offer is being made in
reliance on interpretations by the staff of the Securities and Exchange
Commission (the "SEC"), as set forth in no-action letters issued to third
parties, that the New Notes issued pursuant to the Exchange Offer in exchange
for the Old Notes may be offered for resale, resold and otherwise transferred by
Holders thereof (other than any such Holder that is an "affiliate" of the
Company within the meaning of Rule 405 under the Securities Act), without
compliance with the registration and prospectus delivery provisions of the
Securities Act, provided that such Holders are not broker-dealers, such New
Notes are acquired in the ordinary course of such Holders' business and such
Holders have no arrangement or understanding with any person to participate in
the distribution of such New Notes. However, the SEC has not considered the
Exchange Offer in the context of a no-action letter and there can be no
assurance that the staff of the SEC would make a similar determination with
respect to the Exchange Offer as in other circumstances. If the undersigned is
not a broker-dealer, then the undersigned represents that it is not engaged in,
and does not intend to engage in, a distribution of the New Notes. If any Holder
is an affiliate of the Company, or has any arrangement or understanding with
respect to the distribution of the New Notes to be acquired pursuant to the
Exchange Offer, such Holder (i) cannot rely on the applicable interpretations of
the staff of the SEC, (ii) is not entitled and will not be permitted to tender
Old Notes in the Exchange Offer and (iii) must comply with the registration and
prospectus delivery requirements of the Securities Act in connection with any
resale transaction. If the undersigned is a broker-dealer that will receive New
Notes for its own account in exchange for Old Notes, it represents that the Old
Notes to be exchanged for the New Notes were acquired by it as a result of
market-making activities or other trading activities and acknowledges that it
will deliver a prospectus meeting the requirements of the Securities Act in
connection with any resale of such New Notes; however, by so acknowledging and
by delivering a prospectus meeting the requirements of the

                                       4



Securities Act, the undersigned will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.

         The undersigned will, upon request, execute and deliver any additional
documents reasonably deemed by the Company to be necessary or desirable to
complete the sale, assignment and transfer of the Old Notes tendered hereby. All
authority conferred or agreed to be conferred in this Letter and every
obligation of the undersigned hereunder shall be binding upon the successors,
assigns, heirs, executors, administrators, trustees in bankruptcy and legal
representatives of the undersigned and shall not be affected by, and shall
survive, the death or incapacity of the undersigned. This tender may be
withdrawn only in accordance with the procedures set forth in "The Exchange
Offer - Withdrawal Rights" section of the Prospectus.

         Unless otherwise indicated herein in the box entitled "Special Issuance
Instructions" below, please deliver the New Notes (and, if applicable,
substitute certificates representing Old Notes for any Old Notes not exchanged)
in the name of the undersigned or, in the case of a book-entry delivery of Old
Notes, please credit the account indicated above maintained at the Book-Entry
Transfer Facility. Similarly, unless otherwise indicated under the box entitled
"Special Delivery Instructions" below, please send the New Notes (and, if
applicable, substitute certificates representing Old Notes for any Old Notes not
exchanged) to the undersigned at the address shown above in the box entitled
"Description of Old Notes Tendered."

         THE UNDERSIGNED, BY COMPLETING THE BOX ENTITLED "DESCRIPTION OF OLD
NOTES TENDERED" ON PAGE 3 OF THIS LETTER AND SIGNING THIS LETTER, WILL BE DEEMED
TO HAVE TENDERED THE OLD NOTES AS SET FORTH IN SUCH BOX ON PAGE 3 OF THIS
LETTER.


                                       5








                         SPECIAL ISSUANCE INSTRUCTIONS
                           (SEE INSTRUCTIONS 3 AND 4)

         To be completed ONLY if Old Notes not exchanged and/or New Notes are to
be issued in the name of someone other than the undersigned, or if Old Notes
delivered by book-entry transfer which are not accepted for exchange are to be
returned by credit to an account maintained at the Book-Entry Transfer Facility
other than the account indicated above.

Issue:       |_|  New Notes
             |_|  Old Notes

Name(s)
             -----------------------------------------
                    (Please Type or Print)


             -----------------------------------------

Address
             -----------------------------------------

             -----------------------------------------


Taxpayer Identification or Social Security No.

- ------------------------------------------------------

|_|      Credit unexchanged Old Notes delivered by book-entry transfer to the
         Book-Entry Transfer Facility account set forth below.


- ------------------------------------------------------
(Book-Entry Transfer Facility Account Number,
if applicable)








                         SPECIAL DELIVERY INSTRUCTIONS
                           (SEE INSTRUCTIONS 3 AND 4)

         To be completed ONLY if Old Notes not exchanged and/or New Notes are to
be sent to someone other than the undersigned, or to the undersigned at an
address other than shown in the box entitled "Description of Old Notes Tendered"
on this Letter.

Mail:        |_|  New Notes
             |_|  Old Notes

Name(s)
           -----------------------------------------
                    (Please Type or Print)


           -----------------------------------------


Address
           -----------------------------------------
           -----------------------------------------





                                       6







                     ALL TENDERING HOLDERS PLEASE SIGN HERE
                   (COMPLETE SUBSTITUTE FORM W-9 ON NEXT PAGE)


x                                                                         , 2002
     ------------------------------------    ----------------------------
                                                         Date
x                                                                         , 2002
     ------------------------------------    ----------------------------
                                                         Date

Area Code and Telephone Number
                               -----------------------------------------------
         This Letter must be signed by the registered holder(s) or DTC
participant(s) exactly as the name(s) appear(s) on the Old Notes or on a
security position listing or by any person(s) authorized to become registered
holder(s) by endorsements and documents transmitted herewith. If signature is by
a trustee, executor, administrator, guardian, officer or other person acting in
a fiduciary or representative capacity, please provide the following
information. See Instruction 3.

Name(s):
         ---------------------------------------------------------------------
                             (Please Type or Print)

Capacity (full title):
                       -------------------------------------------------------

Address:
         ---------------------------------------------------------------------

- ------------------------------------------------------------------------------

Taxpayer Identification or Social Security No.:
                                                ------------------------------

- ------------------------------------------------------------------------------


                               SIGNATURE GUARANTEE
                         (IF REQUIRED BY INSTRUCTION 3)

Signature(s) Guaranteed
By an Eligible Institution:
                            --------------------------------------------------
                                        (Authorized Signature)

Name and Title:
                --------------------------------------------------------------

Name of Firm:
              ----------------------------------------------------------------

Dated:                , 2002
       ---------------

IMPORTANT: THIS LETTER (OR A FACSIMILE HEREOF), TOGETHER WITH THE CERTIFICATES
FOR OLD NOTES OR A BOOK-ENTRY CONFIRMATION AND ALL OTHER REQUIRED DOCUMENTS OR
THE NOTICE OF GUARANTEED DELIVERY, MUST BE RECEIVED BY THE EXCHANGE AGENT PRIOR
TO 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE.


                                       7








                                          TO BE COMPLETED BY ALL TENDERING HOLDERS
                                                    (SEE INSTRUCTION 5)
- ---------------------------------------------------------------------------------------------------------------
                                                PAYOR'S NAME: U.S. BANK, N.A.
- ---------------------------------------------------------------------------------------------------------------
                                                                          
SUBSTITUTE                           Part 1 - PLEASE PROVIDE YOUR TAXPAYER       Social security number
FORM W-9                             IDENTIFICATION NUMBER IN THE BOX AT RIGHT
                                     AND CERTIFY BY SIGNING AND DATING BELOW.    ------------------------------
                                     If Old Notes are held in more than          OR
                                     one name, see the Guidelines for            Employer Identification number
                                     Certification of Taxpayer
                                     Identification Number on Substitute         ------------------------------
                                     W-9 to determine which number you
                                     must provide.


DEPARTMENT OF THE TREASURY           Part 2 -- FOR PAYEES EXEMPT FROM BACK WITHHOLDING (See the
INTERNAL REVENUE SERVICE             Guidelines for Certification of Taxpayer Identification
                                     Number on Substitute Form W-9).


PAYOR'S REQUEST FOR                  Part 3 -- CERTIFICATION:  UNDER THE PENALTIES OF PERJURY, I
TAXPAYER IDENTIFICATION              CERTIFY THAT:
NUMBER AND CERTIFICATION
                                     (1)     the number shown on this form is my correct taxpayer
                                             identification number
                                             (or I am waiting for a number to be issued to me);

                                     (2)     I am not subject to backup withholding either because:
                                             (a) I am exempt from backup withholding, or (b) I have
                                             not been notified by the Internal Revenue Service that I
                                             am subject to backup withholding as a result of a failure
                                             to report all interest or dividends, or (c) the
                                             Internal Revenue Service has notified me that I am no longer
                                             subject to backup withholding; and

                                     (3)     I am a U.S. Person (including a resident alien).

                                     THE INTERNAL REVENUE SERVICE DOES NOT REQUIRE YOUR CONSENT TO ANY
                                     PROVISION OF THIS DOCUMENT OTHER THAN THE CERTIFICATIONS REQUIRED TO
                                     AVOID BACKUP WITHHOLDING.

                                     SIGNATURE
                                               -----------------------------------
                                     PRINTED NAME
                                                  --------------------------------
                                     DATE
                                          ----------------------

                                     You must cross out item (2) of the above certification if you have been
                                     notified by the Internal Revenue Service that you are subject to
                                     backup withholding because you failed to report all interest and
                                     dividends on your tax return.

- ---------------------------------------------------------------------------------------------------------------
                        YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU ARE AWAITING
                                         A TAXPAYER IDENTIFICATION NUMBER.
- ---------------------------------------------------------------------------------------------------------------


             CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER

I certify under penalties of perjury that a taxpayer identification number has
not been issued to me, and either (a) I have mailed or delivered an application
to receive a taxpayer identification number to the appropriate Internal Revenue
Service Center or Social Security Administration Office or (b) I intend to mail
or deliver an application in the near future. I understand that if I do not
provide a taxpayer identification number by the time of the exchange, 30 percent
of all reportable payments made to me thereafter will be withheld until I
provide a number.

Signature                                           Date
         ---------------------------------------        -----------------


                                       8







                                  INSTRUCTIONS

         FORMING PART OF THE TERMS AND CONDITIONS OF THE EXCHANGE OFFER

1.       DELIVERY OF THIS LETTER AND SENIOR NOTES; GUARANTEED DELIVERY
         PROCEDURES.

         This Letter is to be completed by Holders of Old Notes either if
certificates are to be forwarded herewith or if tenders are to be made pursuant
to the procedures for delivery by book-entry transfer set forth in "The Exchange
Offer - Book-Entry Transfer" section of the Prospectus. Certificates for all
physically tendered Old Notes, or Book-Entry Confirmation, as the case may be,
as well as a properly completed and duly executed Letter (or manually signed
facsimile hereof), with any required signature guarantees, and any other
documents required by this Letter, must be received by the Exchange Agent at the
address set forth herein on or prior to the Expiration Date, or the tendering
Holder must comply with the guaranteed delivery procedures set forth below. Old
Notes tendered hereby must be in denominations of principal amount of $1,000 and
any integral multiples thereof.

         Holders who tender their Old Notes by delivering an Agent's Message do
not need to submit this Letter.

         Holders whose certificates for Old Notes are not immediately available
or who cannot deliver their certificates and all other required documents to the
Exchange Agent on or prior to the Expiration Date, or who cannot complete the
procedure for book-entry transfer on a timely basis, may tender their Old Notes
pursuant to the guaranteed delivery procedures set forth in "The Exchange Offer
- - Guaranteed Delivery Procedures" section of the Prospectus. Pursuant to such
procedures, (i) such tender must be made through an Eligible Institution (as
defined below), (ii) prior to 5:00 P.M., New York City time, on the Expiration
Date, the Exchange Agent must receive from such Eligible Institution a properly
completed and duly executed letter (or a facsimile thereof) and Notice of
Guaranteed Delivery, substantially in the form provided by the Company (by
facsimile transmission, mail or hand delivery), setting forth the name and
address of the Holder of Old Notes and the amount of Old Notes tendered stating
that the tender is being made thereby and guaranteeing that within three New
York Stock Exchange ("NYSE") trading days after the Expiration Date, the
certificates for all physically tendered Old Notes, in proper form for transfer,
or a Book-Entry Confirmation, as the case may be, and any other documents
required by this Letter will be deposited by the Eligible Institution with the
Exchange Agent, and (iii) the certificates for all physically tendered Old
Notes, in proper form for transfer, or a Book-Entry Confirmation, as the case
may be, and all other documents required by this Letter, are received by the
Exchange Agent within three NYSE trading days after the Expiration Date.

         THE METHOD OF DELIVERY OF THIS LETTER, THE OLD NOTES AND ALL OTHER
REQUIRED DOCUMENTS IS AT THE ELECTION AND RISK OF THE TENDERING HOLDERS, AND THE
DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED OR CONFIRMED BY THE
EXCHANGE AGENT. IF DELIVERY IS BY MAIL, REGISTERED MAIL, PROPERLY INSURED, WITH
RETURN RECEIPT REQUESTED, OR OVERNIGHT DELIVERY SERVICE IS RECOMMENDED. IN ALL
CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.

         See "The Exchange Offer" section of the Prospectus.

2.       PARTIAL TENDERS (NOT APPLICABLE TO HOLDERS WHO TENDER BY BOOK-ENTRY
         TRANSFER).

         If less than all of the Old Notes evidenced by a submitted certificate
are to be tendered, the tendering Holder(s) should fill in the aggregate
principal amount of the Old Notes to be tendered in the


                                       9




box above entitled "Description of Old Notes Tendered--Principal Amount
Tendered." A reissued certificate representing the balance of non-tendered Old
Notes will be sent to such tendering Holder, unless otherwise provided in the
appropriate box on this Letter promptly after the Expiration Date. All of the
Old Notes delivered to the Exchange Agent will be deemed to have been tendered
unless otherwise indicated.

3.       SIGNATURES ON THIS LETTER; BOND POWERS AND ENDORSEMENTS; GUARANTEE OF
         SIGNATURES.

         If this Letter is signed by the registered Holder of the Old Notes
tendered hereby, the signature must correspond exactly with the name as written
on the face of the certificates without any change whatsoever. If this Letter is
signed by a participant in DTC, the signature must correspond with the name as
it appears on the security position listing as the owner of the Old Notes.

         If any tendered Old Notes are owned of record by two or more joint
owners, all of such owners must sign this Letter.

         If any tendered Old Notes are registered in different names, it will be
necessary to complete, sign and submit as many separate copies of this Letter as
there are different registrations of Old Notes.

         When this Letter is signed by the registered Holder(s) of the Old Notes
specified herein and tendered hereby, no endorsements of the tendered Old Notes
or separate bond powers are required. If, however, the New Notes are to be
issued, or any untendered Old Notes are to be reissued, to a person other than
the registered Holder, then endorsements of any Old Notes transmitted hereby or
separate bond powers are required. Signatures on the Old Notes or bond power
must be guaranteed by an Eligible Institution.

         If this Letter is signed by a person other than the registered
Holder(s) of any Old Notes specified herein, such Old Notes must be endorsed or
accompanied by appropriate bond powers, in either case signed exactly as the
name or names of the registered Holder or Holders appear(s) on the Old Notes (or
security position listing) and signatures on the Old Notes or bond power must be
guaranteed by an Eligible Institution.

         If this Letter or any certificates or bond powers are signed by
trustees, executors, administrators, guardians, attorneys-in-fact, officers of
corporations or others acting in a fiduciary or representative capacity, such
persons should so indicate when signing, and, unless waived by the Company, must
submit proper evidence satisfactory to the Company of their authority to so act.

         Endorsements on Old Notes or signatures on bond powers required by this
Instruction 3 must be guaranteed by a firm or other entity identified in Rule
17Ad-15 under the Exchange Act as an "eligible guarantor institution," including
(as such terms are defined therein) (i) a bank, (ii) broker, dealer, municipal
securities broker or dealer or government securities broker or dealer, (iii) a
credit union, (iv) a national securities exchange, registered securities
association or clearing agency, or (v) a savings association that is a
participant in a Securities Transfer Association (an "Eligible Institution").

         Signatures on this Letter need not be guaranteed by an Eligible
Institution if the Old Notes are tendered: (i) by a registered Holder of Old
Notes (which term, for purposes of the Exchange Offer, includes any participant
in the Book-Entry Transfer Facility whose name appears on a security position
listing as the owner of such Old Notes) who has not completed the box entitled
"Special Issuance Instructions" or "Special Delivery Instructions" on this
Letter, or (ii) for the account of an Eligible Institution.


                                       10




4.       SPECIAL ISSUANCE AND DELIVERY INSTRUCTIONS.

         Tendering Holders of Old Notes should indicate in the applicable box on
page 6 of this Letter the name and address to which New Notes issued pursuant to
the Exchange Offer and/or substitute certificates evidencing Old Notes not
exchanged are to be issued or sent, if different from the name or address of the
person signing this Letter. In the case of issuance in a different name, the
employer identification or social security number of the person named must also
be indicated. Holders tendering Old Notes by book-entry transfer may request
that Old Notes not exchanged be credited to such account maintained at the
Book-Entry Transfer Facility as such note Holder may designate hereon. If no
such instructions are given, such Old Notes not exchanged will be returned to
the name and address of the person signing this Letter.

5.       TAXPAYER IDENTIFICATION NUMBER.

         Federal income tax law generally requires that a tendering Holder whose
Old Notes are accepted for exchange must provide the Company (as payor) with
such Holder's correct Taxpayer Identification Number ("TIN") on the substitute
Form W-9 on page 8 of this Letter, which in the case of a tendering Holder who
is an individual, is his or her social security number. If the Company is not
provided with the current TIN or an adequate basis for an exemption from backup
withholding, such tendering Holder may be subject to a $50 penalty imposed by
the Internal Revenue Service. In addition, the Exchange Agent maybe required to
withhold 30 percent of the amount of any reportable payments made after the
exchange to such tendering Holder of New Notes. If withholding results in an
overpayment of taxes, a refund may be obtained.

         Exempt Holders of Old Notes (including, among others, all corporations
and certain foreign individuals) are not subject to these backup withholding and
reporting requirements. Exempt Holders, other than foreign individuals, should
furnish their TIN, write "Exempt" on the face of the Substitute Form W-9 and
sign, date and return the form to the Exchange Agent. See the enclosed
Guidelines for Certification of Taxpayer Identification Number on Substitute
Form W-9 (the "W-9 Guidelines") for additional instructions. If the tendering
Holder of Old Notes is a nonresident alien or foreign entity not subject to
backup withholding, such Holder must give the Exchange Agent a completed Form
W-8 Certificate of Foreign Status.

         To prevent backup withholding, each tendering Holder of Old Notes must
provide its correct TIN by completing the Substitute Form W-9 on page 8 of this
Letter, certifying, under penalties of perjury, that the TIN provided is correct
(or that such Holder is awaiting a TIN) and that (i) the Holder is exempt from
backup withholding, or (ii) the Holder has not been notified by the Internal
Revenue Service that such Holder is subject to backup withholding as a result of
a failure to report all interest or dividends or (iii) the Internal Revenue
Service has notified the Holder that such Holder is no longer subject to backup
withholding. If the Old Notes are in more than one name or are not in the name
of the actual owner, such Holder should consult the W-9 Guidelines for
information on which TIN to report. Failure to provide the information on the
form may subject the Holder to 30 percent federal income tax backup withholding
on all reportable payments to the Holder. If such Holder does not have a TIN,
such Holder should consult the W-9 Guidelines for instructions on applying for a
TIN, apply for a TIN and write "applied for" in lieu of its TIN in Part 1 of the
Substitute Form W-9. Writing "applied for" on the form means that such Holder
has already applied for a TIN or that such Holder intends to apply for one in
the near future. If "applied for" is written in Part 1 of the Substitute Form
W-9 and the Exchange Agent is not provided with a TIN within 60 days, the
Exchange Agent will withhold 30 percent of all reportable payments to the Holder
thereafter until a TIN is provided to the Exchange Agent.

                                       11




6.       TRANSFER TAXES.

         The tendering Holders are obligated to pay all transfer taxes, if any,
applicable to the transfer of Old Notes pursuant to the Exchange Offer. If
satisfactory evidence of payment of such taxes or exemption therefrom is not
submitted herewith, the amount of such transfer taxes will be billed directly to
such tendering Holder.

         Except as provided in this Instruction 6, it will not be necessary for
transfer tax stamps to be affixed to the Old Notes specified in this Letter.

7.       NO CONDITIONAL TENDERS.

         No alternative, conditional, irregular or contingent tenders will be
accepted. All tendering Holders of Old Notes, by execution of this Letter, shall
waive any right to receive notice of the acceptance of their Old Notes for
exchange.

         Neither the Company, the Exchange Agent nor any other person is
obligated to give notice of any defect or irregularity with respect to any
tender of Old Notes nor shall any of them incur any liability for failure to
give any such notice.

8.       MUTILATED, LOST, STOLEN OR DESTROYED OLD NOTES.

         Any Holder whose Old Notes have been mutilated, lost, stolen or
destroyed should contact the Exchange Agent at the address indicated above for
further instructions. This Letter and related documents cannot be processed
until the procedures for replacing mutilated, lost, stolen or destroyed
certificates have been followed.

9.       WITHDRAWAL RIGHTS.

         Tenders of Old Notes may be withdrawn at any time prior to 5:00 P.M.,
New York City time, on the Expiration Date. For a withdrawal of a tender of Old
Notes to be effective, a written notice of withdrawal must be received by the
Exchange Agent at the address on page 1 of this Letter prior to 5:00 P.M., New
York City time, on the Expiration Date. Any such notice of withdrawal must (i)
specify the name of the person having tendered the Old Notes to be withdrawn
(the "Depositor"), (ii) identify the Old Notes to be withdrawn (including
certificate number or numbers and the principal amount of such Old Notes), (iii)
contain a statement that such Holder is withdrawing his election to have such
Old Notes exchanged, (iv) be signed by the Holder in the same manner as the
original signature on the Letter by which such Old Notes were tendered
(including any required signature guarantees) or be accompanied by documents of
transfer to have the Trustee with respect to the Old Notes register the transfer
of such Old Notes in the name of the person withdrawing the tender and (v)
specify the name in which such Old Notes are registered, if different from that
of the Depositor. If Old Notes have been tendered pursuant to the procedure for
book-entry transfer set forth in "The Exchange Offer - Book-Entry Transfer"
section of the Prospectus, any notice of withdrawal must specify the name and
number of the account at the Book-Entry Transfer Facility to be credited with
the withdrawn Old Notes and otherwise comply with the procedures of such
facility.

         All questions as to the validity, form and eligibility (including time
of receipt) of such notices will be determined by the Company, whose
determination shall be final and binding on all parties. Any Old Notes so
withdrawn will be deemed not to have been validly tendered for exchange for
purposes of the Exchange Offer and no New Notes will be issued with respect
thereto unless the Old Notes so withdrawn are validly retendered. Any Old Notes
that have been tendered for exchange but

                                       12




which are not exchanged for any reason will be returned to the Holder thereof
without cost to such Holder (or, in the case of Old Notes tendered by book-entry
transfer into the Exchange Agent's account at the Book-Entry Transfer Facility
pursuant to the book-entry transfer procedures set forth in "The Exchange Offer
- - Book-Entry Transfer" section of the Prospectus, such Old Notes will be
credited to an account maintained with the Book-Entry Transfer Facility for the
Old Notes) as soon as practicable after withdrawal, rejection of tender or
termination of the Exchange Offer. Properly withdrawn Old Notes may be
retendered by following the procedures described above at any time on or prior
to 5:00 P.M., New York City time, on the Expiration Date.

10.      IRREGULARITIES.

         The Company will determine, in its sole discretion, all questions as to
the form, validity, eligibility (including time of receipt) and acceptance for
exchange of any tender of Old Notes, which determination shall be final and
binding. The Company reserves the absolute right to reject any and all tenders
of any particular Old Notes not properly tendered or to not accept any
particular Old Notes which acceptance might, in the judgment of the Company or
its counsel, be unlawful. The Company also reserves the absolute right, in its
sole discretion, to waive any defects or irregularities or conditions of the
Exchange Offer as to any particular Old Notes either before or after the
Expiration Date (including the right to waive the ineligibility of any Holder
who seeks to tender Old Notes in the Exchange Offer). The interpretation of the
terms and conditions of the Exchange Offer as to any particular Old Notes either
before or after the Expiration Date (including the Letter and the instructions
thereto) by the Company shall be final and binding on all parties. Unless
waived, any defects or irregularities in connection with the tender of Old Notes
for exchange must be cured within such reasonable period of time as the Company
shall determine. Neither the Company, the Exchange Agent nor any other person
shall be under any duty to give notification of any defect or irregularity with
respect to any tender of Old Notes for exchange, nor shall any of them incur any
liability for failure to give such notification.

11.      REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES.

         Questions relating to the procedure for tendering, as well as requests
for additional copies of the Prospectus, this Letter, the Notice of Guaranteed
Delivery and other related documents may be directed to the Exchange Agent, at
the address and telephone number indicated on page 1 of this Letter.




                                       13

EX-99.3

                                                                    EXHIBIT 99.3

                         NOTICE OF GUARANTEED DELIVERY
                                 FOR TENDER OF
                          9 1/2% SENIOR NOTES DUE 2010
                                       OF
                       EXTENDICARE HEALTH SERVICES, INC.

         This Notice of Guaranteed Delivery, or one substantially equivalent to
this form, must be used to accept the exchange offer of Extendicare Health
Services, Inc. (the "Company") made pursuant to the Prospectus dated
____________, 2002 (the "Prospectus") if certificates for the outstanding 9 1/2%
Senior Notes due 2010 of the Company (the "Old Notes") are not immediately
available or if the procedure for book-entry transfer cannot be completed on a
timely basis or time will not permit all required documents to reach U.S. Bank,
N.A. as exchange agent (the "Exchange Agent"), prior to 5:00 P.M., New York City
time, on ____________, 2002 (the "Expiration Date"). This Notice of Guaranteed
Delivery may be delivered or transmitted by facsimile transmission, overnight
courier, mail or hand delivery to the Exchange Agent as set forth below. In
addition, in order to utilize the guaranteed delivery procedure to tender Old
Notes pursuant to the exchange offer, a completed, signed and dated Letter of
Transmittal (or facsimile thereof) must also be received by the Exchange Agent
prior to 5:00 P.M., New York City time, on the Expiration Date.

         The Exchange Agent for the exchange offer is U.S. Bank, N.A.



    By Facsimile Transmission
    -------------------------                 By Registered or Certified Mail,
(For Eligible Institutions Only):                Hand or overnight Courier:
          (651) 244-0711                         --------------------------
                                                      U.S. Bank, N.A.
      Confirm by Telephone:                        180 East Fifth Street
      --------------------                           St. Paul, MN 55101
          (651) 244-8677                    Attention: Corporate Trust Services



         DELIVERY OF THIS NOTICE TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE, OR
TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE OTHER THAN AS SET FORTH ABOVE, WILL
NOT CONSTITUTE A VALID DELIVERY.

         THIS NOTICE IS NOT TO BE USED TO GUARANTEE SIGNATURES. IF A SIGNATURE
ON A LETTER OF TRANSMITTAL IS REQUIRED TO BE GUARANTEED BY AN ELIGIBLE
INSTITUTION UNDER THE INSTRUCTIONS THERETO, THE SIGNATURE GUARANTEED MUST APPEAR
IN THE APPLICABLE SPACE PROVIDED IN THE SIGNATURE BOX ON THE LETTER OF
TRANSMITTAL.









Ladies and Gentlemen:

         Upon the terms and subject to the conditions set forth in the
Prospectus and the accompanying Letter of Transmittal, the undersigned hereby
tenders to the Company the principal amount of Old Notes of the series set forth
below pursuant to the guaranteed delivery procedures described in "The Exchange
Offer -- Guaranteed Delivery Procedures" section of the Prospectus.

- --------------------------------    --------------------------------------------
Total Principal Amount of Old       If Old Notes will be delivered by book-entry
   Notes Tendered:*                 transfer to The Depository Trust Company,
                                    provide account number.

           $                            Account Number
            ----------                                -------------------

         Certificate Nos. (if available)
          -----------------------------
- --------------------------------    --------------------------------------------


* Must be in denominations of principal amount of $1,000 and any integral
multiple thereof.

         All authority herein conferred or agreed to be conferred shall survive
the death or incapacity of the undersigned and every obligation of the
undersigned hereunder shall be binding upon the heirs, personal representatives,
successors and assigns of the undersigned.


              PLEASE SIGN HERE

X
   ------------------------------------------------      -----------------------
X
   ------------------------------------------------      -----------------------
                Signature(s) of Owner(s)                             Date
                 or Authorized Signatory


Area Code and Telephone Number(s):
                                   ---------------------------------------------

         Must be signed by the registered holder(s) of Old Notes as their
name(s) appear(s) on the Old Notes or on a security position listing, or by
person(s) authorized to become registered holder(s) by endorsement and documents
transmitted with this Notice of Guaranteed Delivery. If signature is by a
trustee, executor administrator, guardian, attorney-in-fact, officer or other
person acting in a fiduciary or representative capacity, please provide the
following information.

                      Please print name(s) and address(es)

Name(s):
        ------------------------------------------------------------------------

- --------------------------------------------------------------------------------

Capacity:
         -----------------------------------------------------------------------

Address(es):
            --------------------------------------------------------------------

- --------------------------------------------------------------------------------

Telephone Number:
                 ---------------------------------------------------------------



                                      -2-







                                    GUARANTEE
                    (NOT TO BE USED FOR SIGNATURE GUARANTEE)

         The undersigned, a firm or other entity identified in Rule 17Ad-15
under the Securities Exchange Act of 1934, as amended, as an "eligible guarantor
institution" including (as such terms are defined therein) (i) a bank, (ii)
broker, dealer, municipal securities broker or dealer or government securities
broker or dealer, (iii) a credit union, (iv) a national securities exchange,
registered securities association or clearing agency, or (v) a savings
association that is a participant in a Securities Transfer Association (an
"Eligible Institution"), hereby guarantees that the certificates representing
the principal amount of Old Notes tendered hereby in proper form for transfer,
or timely confirmation of the book-entry transfer of such Old Notes into the
Exchange Agent's account at The Depository Trust Company pursuant to the
procedures set forth in "The Exchange Offer -- Guaranteed Delivery Procedures"
section of the Prospectus, together with any required signature guarantee and
any other documents required by the Letter of Transmittal, will be received by
the Exchange Agent at the address set forth above, no later than three New York
Stock Exchange trading days after the Expiration Date.


- --------------------------------          --------------------------------
         Name of Firm                            Authorized Signature


- --------------------------------          --------------------------------
           Address                                      Title


- --------------------------------          Name:
           Zip Code                            ---------------------------
                                                  (Please Type or Print)


- --------------------------------          Dated:
       Telephone Number                        ---------------------------



NOTE:    DO NOT SEND CERTIFICATES FOR OLD NOTES WITH THIS FORM. CERTIFICATES FOR
         OLD NOTES SHOULD BE SENT ONLY WITH A COPY OF YOUR PREVIOUSLY EXECUTED
         LETTER OF TRANSMITTAL.







                                      -3-

EX-99.4

                                                                    EXHIBIT 99.4


            GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
                         NUMBER ON SUBSTITUTE FORM W-9

         GUIDELINES FOR DETERMINING THE PROPER NAME AND IDENTIFICATION NUMBER TO
GIVE THE PAYER.-Social Security numbers have nine digits separated by two
hyphens: i.e., 000-00-0000. Employer identification numbers have nine digits
separated by only one hyphen: i.e., 00-0000000. The table below will help
determine the name and number to give the payer.





- -------------------------------------------------------     ------------------------------------------------------------
                                                                                              GIVE THE NAME AND
                                GIVE THE NAME AND                                             EMPLOYER
                                SOCIAL SECURITY                                               IDENTIFICATION
FOR THIS TYPE OF ACCOUNT        NUMBER OF-                         FOR THIS TYPE OF ACCOUNT   NUMBER OF-
- -------------------------------------------------------     ------------------------------------------------------------
                                                                                     
1.  Individual                 The individual               6.   Sole proprietorship          The owner(3)

2.  Two or more individuals    The actual owner of          7.   A valid trust, estate or     The legal entity(4)
    (joint account)            the account or, if                pension trust
                               combined funds, the
                               first individual on          8.   Corporate                    The corporation
                               the account(1)

3.  Custodian account of a     The minor(2)                 9.   Association, club,           The organization
    minor (Uniform Gift to                                       religious, charitable,
    Minors Act)                                                  educational or other
                                                                 tax-exempt organization
4.  a.   The usual revocable   The grantor-trustee(1)
    savings trust account                                   10.  Partnership                  The partnership
    (grantor is also trustee)
                                                            11.  A broker or registered       The broker or nominee
    b.   So-called trust       The actual owner(1)               nominee
    account that is not a
    legal or valid trust                                    12.  Account with the             The public entity
    under state law                                              Department of Agriculture
                                                                 in the name of a public
5.  Sole proprietorship        The owner(3)                      entity (such as a state or
                                                                 local government, school
                                                                 district or prison) that
                                                                 receives agricultural
                                                                 program payments
- -------------------------------------------------------     ------------------------------------------------------------


(1)      List first and circle the name of the person whose number you furnish.
         If only one person on a joint account has a social security number,
         that person's number must be furnished.

(2)      Circle the minor's name and furnish the minor's social security number.

(3)      You must show your individual name, but you may also enter your
         business or "doing business as" name. You may use either your social
         security number or your employer identification number (if you have
         one).

(4)      List first and circle the name of the legal trust, estate or pension
         trust. (Do not furnish the identifying number of the personal
         representative or trustee unless the legal entity itself is not
         designated in the account title.)

NOTE:    If no name is circled when more than one name is listed, the number
         will be considered to be that of the first name listed.









             GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
                          NUMBER ON SUBSTITUTE FORM W-9
                                     PAGE 2

OBTAINING A NUMBER

         If you don't have a taxpayer identification number, apply for one
immediately. To apply for a social security number, get Form SS-5 from your
local Social Security Administration office. Get Form SS-4 to apply for an
employer identification number. You can get Form SS-4 from the IRS by calling
1-800-TAX-FORM (1-800-829-3676).

PAYEES EXEMPT FROM BACKUP WITHHOLDING

         The following is a list of payees specifically exempted from backup
withholding:
(1)      An organization exempt from tax under section 501(a), any IRA, or a
         custodial account under section 403(b)(7) if the account satisfies the
         requirements of section 401(f)(2).
(2)      The United States or of any of its agencies or instrumentalities.
(3)      A state, the District of Columbia, a possession of the United States,
         or any of their political subdivisions or instrumentalities.
(4)      A foreign government or any of its political subdivisions, agencies or
         instrumentalities.
(5)      An international organization or any of its agencies or
         instrumentalities.
         Other payees that may be exempt from backup
withholding include:
(6)      A corporation.
(7)      A foreign central bank of issue.
(8)      A dealer in securities or commodities required to register in the
         United States, the District of Columbia, or a possession of the United
         States.
(9)      A futures commission merchant registered with the Commodity Futures
         Trading Commission
(10)     A real estate investment trust.
(11)     An entity registered at all times during the tax year under the
         Investment Company Act of 1940.
(12)     A common trust fund operated by a bank under section 584(a).
(13)     A financial institution.
(14)     A middleman known in the investment community as a nominee or
         custodian.
(15)     A trust exempt from tax under section 664 or described in section 4947.


         Exempt payees described above should file Form W-9 to avoid possible
erroneous backup withholding. FURNISH YOUR TAXPAYER IDENTIFICATION NUMBER, WRITE
"EXEMPT" IN PART II OF THE FORM, SIGN AND DATE THE FORM AND RETURN IT TO THE
PAYER. If you are a nonresident alien or a foreign entity not subject to backup
withholding, give the payer a completed Form W-8, Certificate of Foreign Status.

         PRIVACY ACT NOTICE.-Section 6109 of the Internal Revenue Code requires
most recipients of dividend, interest or other payments to give correct taxpayer
identification numbers to payers who must report the payments to the IRS. The
IRS uses the numbers for identification purposes and to help verify the accuracy
of your return. The IRS may also provide this information to the Department of
Justice for criminal and civil litigation and to cities, states and the District
of Columbia to carry out their tax laws. Payers must be given the numbers
whether or not recipients are required to file tax returns. Payers must
generally withhold 30 percent of taxable interest, dividend and certain other
payments to a payee who does not furnish a taxpayer identification number to a
payer. Certain penalties may also apply.

PENALTIES

         (1) FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER.-If you fail to
furnish your correct taxpayer identification number to a payer, you are subject
to a penalty of $50 for each such failure unless your failure is due to
reasonable cause and not to willful neglect.

         (2) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING.-If
you make a false statement with no reasonable basis which results in no backup
withholding, you are subject to a $500 penalty.

         (3) CRIMINAL PENALTY FOR FALSIFYING INFORMATION.-Willfully falsifying
certifications or affirmations may subject you to criminal penalties including
fines and/or imprisonment.

         FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL
REVENUE SERVICE.

EX-99.5

                                                                    EXHIBIT 99.5

                       EXTENDICARE HEALTH SERVICES, INC.

                               OFFER TO EXCHANGE
                    REGISTERED 9 1/2% SENIOR NOTES DUE 2010
     FOR ANY AND ALL OUTSTANDING UNREGISTERED 9 1/2% SENIOR NOTES DUE 2010



      THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
      TIME, ON ______________, 2002, UNLESS THE OFFER IS EXTENDED.



                                                              ____________, 2002

To Our Clients:

         Enclosed for your consideration is a Prospectus, dated __________, 2002
(the "Prospectus"), and the related Letter of Transmittal (the "Letter of
Transmittal"), relating to the offer (the "Exchange Offer") of Extendicare
Health Services, Inc. (the "Company") to exchange its 9 1/2% Senior Notes due
2010 which have been registered under the Securities Act of 1933, as amended,
for all of its outstanding unregistered 9 1/2% Senior Notes due 2010 (the "Old
Notes"), upon the terms and subject to the conditions described in the
Prospectus and the Letter of Transmittal. The Exchange Offer is being made in
order to satisfy certain obligations of the Company contained in the Exchange
and Registration Rights Agreement dated June 28, 2002, by and between the
Company, the subsidiary guarantors from time to time party thereto and the
initial purchasers named therein, related to the 9 1/2% Senior Notes due 2010.

         This material is being forwarded to you as the beneficial owner of the
Old Notes held by us for your account but not registered in your name. A tender
of such Old Notes may only be made by us as the holder of record and pursuant to
your instructions.

         Accordingly, we request instructions as to whether you wish us to
tender on your behalf the Old Notes held by us for your account, pursuant to the
terms and conditions set forth in the enclosed Prospectus and Letter of
Transmittal. We urge you to read the Prospectus carefully before instructing us
as to whether or not to tender your Old Notes.

         Your instructions should be forwarded to us as promptly as possible in
order to permit us to tender the Old Notes on your behalf in accordance with the
provisions of the Exchange Offer. The Exchange Offer will expire at 5:00 p.m.,
New York City time, on __________, 2002, unless extended by the Company. Any Old
Notes tendered pursuant to the Exchange Offer may be withdrawn at any time
before the Expiration Date.

         If you wish to have us tender your Old Notes, please instruct us by
completing, executing and returning to us the instruction form enclosed with
this letter. The Letter of Transmittal is furnished to you for information only
and may not be used directly by you to tender Old Notes.

         If we do not receive written instructions in accordance with the
procedures presented in the Prospectus and the Letter of Transmittal we will not
tender any of the outstanding Old Notes on your account.

EX-99.6

                                                                    EXHIBIT 99.6


                                  INSTRUCTIONS

          INSTRUCTIONS TO REGISTERED HOLDER AND/OR PARTICIPANTS IN DTC
                             FROM BENEFICIAL OWNER
                                       OF
                          9 1/2% SENIOR NOTES DUE 2010


        THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
     TIME, ON ___________________, 2002, UNLESS THE OFFER IS EXTENDED.


To Registered Holder and/or Participants in The Depository Trust Company:

         The undersigned hereby acknowledges receipt of the Prospectus dated
____________, 2002 (the "Prospectus") of Extendicare Health Services, Inc., a
Delaware corporation (the "Company"), and the accompanying Letter of Transmittal
(the "Letter of Transmittal"), that together constitute the Company's offer (the
"Exchange Offer") to exchange its 9 1/2% Senior Notes due 2010 (the "New Notes")
which have been registered under the Securities Act of 1933, as amended (the
"Securities Act"), for all of its outstanding registered 9 1/2% Senior Notes due
2010 (the "Old Notes"). Capitalized terms used but not defined herein have the
meanings ascribed to them in the Prospectus.

         This will instruct you, the registered holder and/or Participants in
The Depository Trust Company, as to the action to be taken by you relating to
the Exchange Offer with respect to the Old Notes held by you for the account of
the undersigned.

         The aggregate principal amount of Old Notes held by you for the account
of the undersigned is (fill in amount):

                   $__________ of the outstanding 9 1/2% Senior Notes due 2010.

         With respect to the Exchange Offer, the undersigned hereby instructs
you (check appropriate box):

|_|      TO TENDER the following Old Notes held by you for the account of the
         undersigned (insert principal amount of Old Notes to be tendered, if
         less than all):

                   $__________ of the outstanding 9 1/2% Senior Notes due 2010.

|_| NOT TO TENDER any Old Notes held by you for the account of the undersigned.

         If the undersigned instructs you to tender Old Notes held by you for
the account of the undersigned, it is understood that you are authorized to
make, on behalf of the undersigned (and the undersigned, by its signature below,
hereby makes to you), the representations and warranties contained in the Letter
of Transmittal that are to be made with respect to the undersigned as a
beneficial owner, including but not limited to the representations, that (i) the
undersigned is not an "affiliate" of the Company, (ii) any New Notes to be
received by the undersigned are being acquired in the ordinary course of its
business, and (iii) the undersigned has no arrangement or understanding with any
person to participate in a distribution (within the meaning of the Securities
Act) of New Notes to be received in the Exchange Offer. If the undersigned is a
broker-dealer that will receive New Notes for its own account in exchange for
Old Notes, it represents that the Old Notes to be exchanged for New

Notes were acquired by it as a result of market-making activities or other
trading activities and acknowledges that it will deliver a prospectus in
connection with any resale of such New Notes; however, by so acknowledging and
by delivering a prospectus, the undersigned will not be deemed to admit that it
is an "underwriter" within the meaning of the Securities Act.



                                    SIGN HERE
Name of Beneficial Owner(s)
                            ----------------------------------------------------
Signature(s)
             -------------------------------------------------------------------
Name(s) (please print)
                       ---------------------------------------------------------
Address
        ------------------------------------------------------------------------

- --------------------------------------------------------------------------------

Telephone Number
                 ---------------------------------------------------------------

Taxpayer Identification or Social Security No.
                                               ---------------------------------

Date
    ----------------------------------------------------------------------------

EX-99.7

                                                                    EXHIBIT 99.7

                       EXTENDICARE HEALTH SERVICES, INC.

                               OFFER TO EXCHANGE
                    REGISTERED 9 1/2% SENIOR NOTES DUE 2010
     FOR ANY AND ALL OUTSTANDING UNREGISTERED 9 1/2% SENIOR NOTES DUE 2010

                                                           ______________, 2002


           THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
          TIME, ON _______________, 2002, UNLESS THE OFFER IS EXTENDED.


To  Brokers, Dealers, Commercial Banks,
    Trust Companies and Other Nominees:

         Extendicare Health Services, Inc. (the "Company") is offering, upon and
subject to the terms and conditions set forth in the Prospectus, dated
_________, 2002 (the "Prospectus"), and the enclosed Letter of Transmittal (the
"Letter of Transmittal"), to exchange (the "Exchange Offer") its 9 1/2% Senior
Notes due 2010 which have been registered under the Securities Act of 1933, as
amended, for all of its outstanding unregistered 9 1/2% Senior Notes due 2010
(the "Old Notes"). The Exchange Offer is being made in order to satisfy certain
obligations of the Company contained in the Exchange and Registration Rights
Agreement dated June 28, 2002, by and among the Company, the subsidiary
guarantors from time to time party thereto and the initial purchasers named
therein, relating to the 9 1/2% Senior Notes due 2010.

         We are requesting that you contact your clients for whom you hold Old
Notes regarding the Exchange Offer. For your information and for forwarding to
your clients for whom you hold Old Notes registered in your name or in the name
of your nominee, or who hold Old Notes registered in their own names, we are
enclosing the following documents:

         1.       The Prospectus;

         2.       The Letter of Transmittal for your use and for the information
of your clients;

         3.       A form of Notice of Guaranteed Delivery;

         4.       A form of letter which may be sent to your clients for whose
accounts you hold Old Notes registered in your name or the name of your nominee,
along with an instruction form for obtaining such clients' instructions with
respect to the Exchange Offer; and

         5.       Guidelines for Certification of Taxpayer Identification Number
on Substitute Form W-9.

         YOUR PROMPT ACTION IS REQUIRED. THE EXCHANGE OFFER WILL EXPIRE AT 5:00
P.M., NEW YORK CITY TIME, ON _______________, 2002, UNLESS EXTENDED BY THE
COMPANY (THE "EXPIRATION DATE"). OLD NOTES TENDERED PURSUANT TO THE EXCHANGE
OFFER MAY BE WITHDRAWN AT ANY TIME BEFORE THE EXPIRATION DATE.

         To participate in the Exchange Offer, certificates for Old Notes, or a
timely confirmation of a book-entry transfer of such Old Notes into U.S. Bank,
N.A.'s, the Exchange Agent, account at the