Tax Information

Shareholder Tax Information Relating to the November 10, 2006 Plan of Arrangement

Effective November 10, 2006, pursuant to the Plan of Arrangement, Extendicare distributed Assisted Living Concepts, Inc. to Extendicare shareholders and converted to a Canadian real estate investment trust structure. The principal tax considerations associated with the reorganization are described in the Management Proxy Circular dated September 13, 2006, a copy of which is found on this website under Investor Documents.

In connection with the reorganization, shareholders will require the following information to assist them with their tax reporting obligations:

Paid-up capital (PUC) of Extendicare Subordinate Voting (SV) and Multiple Voting (MV) Shares for Canadian tax purposes:

Fair market value (FMV) of Assisted Living Concepts, Inc. (ALC) Class A Shares (based on the weighted average trading price on November 10, 2006):

FMV of ALC Class B Shares (based on the weighted average trading price of ALC Class A Shares on November 10, 2006 x 1.075):

FMV of Extendicare Common Share and trust unit of Extendicare Real Estate Investment Trust (a "REIT Unit") (trading symbol: EXE.UN) (based on weighted average trading price of a REIT Unit on the TSX over the ten (10) consecutive trading days immediately following November 10, 2006):

To assist shareholders in assessing the tax implications of the November 10, 2006 Plan of Arrangement, the link below contains example tax calculations for a hypothetical holder of Extendicare Subordinate Voting or Multiple Voting Shares. The examples are for illustrative purposes only, and do not describe all of the tax consequences applicable to a particular shareholder. The examples are qualified in their entirety by the more detailed information relating to the principal Canadian and U.S. federal income tax considerations contained in the September 13, 2006 Management Proxy Circular available on our website under Investor Documents. Extendicare makes no representation as to the tax consequences of the Plan of Arrangement to a particular shareholder. Shareholders should consult their tax advisor regarding the calculations specific to their circumstances.