04-14-2021 Council Packet - Laserfiche WebLink

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20 the Loan Agreement. Any failure by the Corporation to satisfy its payment obligations under the Loan Agreement will have an adverse impact on the ability of the Trustee to pay, from the Trust Estate, debt service payments on the Series 2021D Bonds. Project Risks Adequacy of the Project as Security. The security for the Series 2021D Bonds includes a subordinate lien on the Project, evidenced by the Subordinate Mortgage which has been granted for the benefit of the Trustee. If the Corporation fails to make sufficient and timely payments required on the Senior Notes, it may be necessary for the Senior Lender to exercise its remedies under its senior mortgages, including foreclosure on the Project. Special Purpose Facilities. The Project is being specifically constructed to included skilled nursing, independent living, assisted living and memory care facilities and is subject to physical restrictions that limit the alternative uses that can be made of such property. If the Corporation is unable to operate the Project successfully, the number of entities that would be interested in purchasing or leasing the Project from the Corporation for other purposes could be extremely limited, and the ability of the Trustee to lease or sell the Project to third parties would be adversely affected. Therefore, there is no assurance that the Trustee could realize sufficient proceeds from the foreclosure of the Subordinate Mortgage and the sale of the Project thereunder to pay the Series 2021D Bonds in their entirety. Rental Housing Requirements. The Corporation has adopted a policy which commits it to maintaining in residence to the extent it is able, residents who become unable to pay and to provide services to its residents at the lowest feasible costs taking into account its financial situation including debt service and a need for reasonable services. These restrictions may limit the ability of the Corporation to increase the rent charged to the residents of the Project to the extent required to compensate for increasing expenses. The foregoing requirements may adversely affect the occupancy and revenues of the Project and may limit the Corporation’s ability to refinance the Project. Other Government Regulation. The Project is and will continue to be subject to rules and regulations promulgated by various agencies and bodies of federal, state and local governments which have jurisdiction over such matters as employment, environment, safety, traffic and health. The impact of such rules and regulations on the Project is unknown and cannot be predicted. Future orders, pursuant to existing or subsequently enacted rules or regulations, may require the expenditure by the Corporation of substantial sums to effect compliance therewith. Appraisals [Describe appraisal] (the “Appraisal”). The Appraisal is based on certain assumptions significant to the operation of the Project as described therein, and sets forth information as of the date thereof. Some assumed events and circumstances will not materialize and unanticipated events and circumstances may occur subsequent to the dates of the Appraisal. Neither the Issuer, the Underwriter, the Trustee nor any counsel rendering approving or other opinions with respect to the transactions described herein have examined or verified the assumptions and conclusions contained in the Appraisal. The Appraisal is available from the Underwriter prior to the closing of the Series 2021D Bonds. Financial Projections The Financial Forecast included in Appendix C: “FINANCIAL FEASIBILITY STUDY” is based upon assumptions made by management of the Corporation. As stated in the Financial Forecast, there will usually be differences between the Financial Forecasted and actual results, because events and circumstances frequently do not occur as expected, and those differences may be material. In addition, the Financial Forecast is only for the period ending December 31, 2025, and consequently does not cover the whole period during which the Series 2021D Bonds may be outstanding. See the Financial Forecast included herein as APPENDIX C, which should be read in its entirety, including management’s notes and assumptions set forth therein. BECAUSE THERE IS NO ASSURANCE THAT ACTUAL EVENTS WILL CORRESPOND WITH THE ASSUMPTIONS MADE BY MANAGEMENT, NO GUARANTEE CAN BE MADE THAT THE FINANCIAL FORECAST WILL CORRESPOND WITH THE RESULTS ACTUALLY ACHIEVED IN THE FUTURE. ACTUAL OPERATING RESULTS MAY BE AFFECTED BY MANY UNCONTROLLABLE FACTORS, INCLUDING BUT NOT LIMITED TO INCREASED COSTS, LOWER THAN ANTICIPATED REVENUES,