Governance Committee Charter 
                                                                           
Manor Care, Inc.                                            December 2002    


Purpose

The Governance Committee is appointed by the Board (1) to identify individuals qualified to become Board members and recommend to the Board the director nominees for the next annual meeting of stockholders; (2) to recommend to the Board the Corporate Governance Guidelines applicable to the company; (3) to lead the Board in its annual review of the Boardís performance; and (4) to recommend to the Board director nominees for each committee of the Board.

Committee Membership

The Governance Committee shall consist of no fewer than three members. The members of the Governance Committee shall meet the independence requirements of the New York Stock Exchange. The members of the Governance Committee shall be appointed and replaced by the Board.

Committee Authority and Responsibilities

  1. The Governance Committee shall have the sole authority to retain and terminate any search firm to be used to identify director candidates and shall have sole authority to approve the search firmís fees and other retention terms. The Governance Committee shall also have authority to obtain advice and assistance from internal or external legal, accounting or other advisors.
     
  2. The Governance Committee shall recommend to the Board the number of directors that shall constitute the whole board of directors.
     
  3. The Governance Committee shall periodically determine the appropriate selection criteria for evaluating potential director candidates. The Committee shall solicit input from all current directors on such criteria.
     
  4. The Governance Committee shall actively seek individuals qualified to become board members, shall evaluate such individuals and shall make appropriate recommendations to the Board with respect thereto.
     
  5. The Governance Committee shall receive comments from all directors and report annually to the Board with an assessment of the Boardís performance, to be discussed with the full Board at an appropriate time.
     
  6. The Governance Committee shall annually review the compensation payable to the outside directors for service on the Board of Directors and make recommendations to the Board with respect thereto.
     
  7. The Governance Committee shall develop and periodically review and reassess the corporate governance guidelines of the company and recommend any proposed changes to the Board for approval.
     
  8. The Governance Committee may form and delegate authority to subcommittees when appropriate.
     
  9. The Governance Committee shall annually recommend to the Board the nominees for director to be selected by the stockholders at each annual meeting of the stockholders.
     
  10. The Governance Committee shall recommend to the Board committee assignments for each director in accordance with the companyís corporate governance guidelines, the committee charters and any applicable regulatory and NYSE requirements.
     
  11. The Governance Committee shall make regular reports to the Board.
     
  12. The Governance Committee shall review and reassess the adequacy of this Charter annually and recommend any proposed changes to the Board for approval. The Governance Committee shall annually review its own performance.