Content analysis
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Legalese | ||
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H.S. junior Good
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New words:
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Removed:
acquiring, added, Aid, alleviate, amendment, American, analyze, appraised, approach, approved, assessing, assurance, assure, aware, BB, bed, benchmark, borrowed, ceasing, charter, classification, collectively, combat, commence, commenced, committee, consent, consented, consisted, constituting, consummated, consummation, contemplated, covenant, cutoff, cyclical, daily, damage, deciding, deconsolidated, demonstrate, dependent, designed, desire, difficult, disruption, doubt, downgraded, downturn, earlier, effect, effort, equaled, established, expand, expedited, explore, face, failure, feature, filing, flow, foregoing, globally, gradually, granting, group, historic, Hurricane, Ian, improved, incurring, individually, intended, investor, issuing, landscaping, lender, LIBOR, light, listing, lost, low, marketing, member, merge, merged, mitigating, multiplying, mutually, negotiated, noteholder, nursing, occur, OPI, outcome, past, permitting, pledged, point, precautionary, prepaid, prepayment, prevent, program, proposed, prospective, pursue, quoted, realized, reborrow, receipt, recommended, recourse, recoverability, refinanced, registration, relief, remained, removed, replaced, repurchase, repurchased, rescue, restrictive, retained, retention, retire, retired, returned, secure, seek, seeking, seller, selling, set, shelf, skilled, spread, structure, substantial, successful, surviving, sustained, treatment, unrelated, upcoming, variability, violation, vulnerable, waived, waiver, Warning, yield
Financial report summary
?Risks
- Unfavorable market and industry conditions may have a material adverse effect on our results of operations, financial condition and ability to pay distributions to our shareholders.
- Our and our managers’ and other operators’ and tenants’ businesses may not return to the levels experienced prior to the COVID-19 pandemic and they may fail to satisfy their obligations to us.
- We have a substantial amount of debt and are subject to risks related to our debt, including our ability to refinance maturing debt and the cost of any such refinanced debt.
- We are limited in our ability to operate our senior living communities and are thus dependent on our managers or other operators.
- We are exposed to operational risks, liabilities and claims with respect to our SHOP segment that could adversely affect our revenues and operations.
- The trend for seniors to delay moving to senior living communities until they require greater care or to forgo moving to senior living communities altogether could have a material adverse effect on our business, financial condition and results of operations.
- Increased labor costs, decreased labor availability and staffing turnover have negatively impacted our managers and our SHOP segment operating results, and these conditions may continue for an extended period.
- Termination of assisted living resident agreements and resident attrition could adversely affect revenues and earnings at our senior living communities.
- Our investments in our properties may not yield the returns we expect and may cost more than expected and take longer to complete.
- Depressed U.S. housing market conditions and other factors may reduce the willingness or ability of seniors to relocate to our senior living communities.
- REIT distribution requirements and limitations on our ability to access capital at reasonable costs or at all may adversely impact our ability to carry out our business plan.
- High interest rates have significantly increased our interest expense and may otherwise materially and negatively affect us.
- Our managers or other operators may fail to comply with laws relating to the operation of our senior living communities.
- We and our managers and other operators and tenants face significant competition.
- We may be unable to lease our properties when our leases expire.
- We are exposed to risks associated with property development, redevelopment and repositioning that could adversely affect us, including our financial condition and results of operations.
- Ownership of real estate is subject to environmental risks and liabilities.
- We are subject to risks from adverse weather, natural disasters and adverse impact from global climate change, and we incur significant costs and invest significant amounts with respect to these matters.
- Vacancies in a property could result in significant capital expenditures and illiquidity and reduce the value of the property.
- RMR and our senior living community managers rely on information technology and systems in providing services to us, and any material failure, inadequacy, interruption or security breach of that technology or those systems could materially harm us.
- Sustainability initiatives, requirements and market expectations may impose additional costs and expose us to new risks.
- Insurance may not adequately cover our losses, and insurance costs may continue to increase.
- We may not succeed in selling properties we may identify for sale and any proceeds we may receive from sales we do complete may be less than expected, and we may incur losses with respect to any such sales.
- We may be unable to grow our business by acquiring additional properties, and we might encounter unanticipated difficulties and expenditures relating to our acquired properties.
- Our existing and any future joint ventures may limit our flexibility with jointly owned investments and we may not realize the benefits we expect from these arrangements.
- Bankruptcy law may adversely impact us.
- A severe cold or flu season, epidemics or any other widespread illnesses could adversely affect the operations of our senior living communities.
- We are dependent upon RMR to manage our business and implement our growth strategy.
- RMR has broad discretion in operating our day to day business.
- Our management structure and agreements and relationships with RMR and RMR’s and its controlling shareholder’s relationships with others may create conflicts of interest, or the perception of such conflicts, and may restrict our investment activities.
- Our management agreements with RMR were not negotiated on an arm’s length basis and their fee and expense structure may not create proper incentives for RMR, which may increase the risk of an investment in our common shares.
- The termination of our management agreements with RMR may require us to pay a substantial termination fee, including in the case of a termination for unsatisfactory performance, which may limit our ability to end our relationship with RMR.
- Our management arrangements with RMR may discourage a change of control of us.
- Our business dealings with AlerisLife (including Five Star) comprise a significant part of our business and operations and they may create conflicts of interest or the perception of such conflicts of interest.
- We may be required to pay a substantial termination fee to Five Star if Five Star terminates our management agreements due to our default.
- We may not realize the benefits we expect from our ownership interest in AlerisLife.
- We are party to transactions with related parties that may increase the risk of allegations of conflicts of interest.
- We may be at an increased risk for dissident shareholder activities due to perceived conflicts of interest arising from our management structure and relationships.
- We may change our operational, financing and investment policies without shareholder approval and we may become more highly leveraged, which may increase our risk of default under our debt obligations.
- Ownership limitations and certain provisions in our declaration of trust, bylaws and agreements, as well as certain provisions of Maryland law, may deter, delay or prevent a change in our control or unsolicited acquisition proposals.
- Our rights and the rights of our shareholders to take action against our Trustees and officers are limited.
- Shareholder litigation against us or our Trustees, officers, managers or other agents may be referred to mandatory arbitration proceedings, which follow different procedures than in-court litigation and may be more restrictive to shareholders asserting claims than in-court litigation.
- Our bylaws designate the Circuit Court for Baltimore City, Maryland as the sole and exclusive forum for certain actions and proceedings that may be initiated by our shareholders, which could limit our shareholders’ ability to obtain a favorable judicial forum for disputes with us or our Trustees, officers, managers or other agents.
- Disputes with RMR may be referred to mandatory arbitration proceedings, which follow different procedures than in-court litigation and may be more restrictive to those asserting claims than in-court litigation.
- Our failure to remain qualified for taxation as a REIT under the IRC could have significant adverse consequences.
- Distributions to shareholders generally will not qualify for reduced tax rates applicable to “qualified dividends.”
- REIT distribution requirements could adversely affect us and our shareholders.
- Even if we remain qualified for taxation as a REIT under the IRC, we may face other tax liabilities that reduce our cash flow.
- If arrangements involving our TRSs fail to comply as intended with the REIT qualification and taxation rules, we may fail to qualify for taxation as a REIT under the IRC or be subject to significant penalty taxes.
- Legislative or other actions affecting REITs could materially and adversely affect us and our shareholders.
- Our quarterly cash distribution rate on our common shares is currently $0.01 per common share and future distributions may remain at this level for an indefinite period or be eliminated and the form of payment could change.
- The Notes and the Guarantees are structurally subordinated to the payment of all indebtedness and other liabilities of our subsidiaries that do not guarantee the 2025 Notes, the 2026 Notes and the 2031 Notes.
- The Notes and the Guarantees, other than the 2026 Notes and related Guarantees on a senior secured basis, are unsecured and effectively subordinated to all of our and the subsidiary guarantors’ existing and future secured debt to the extent of the value of the assets securing such debt.
- Federal and state statutes allow courts, under specific circumstances, to void guarantees and require holders of notes to return payments received from guarantors.
- There may be no public market for certain of the Notes, and one may not develop, be maintained or be liquid.
- A further downgrade in credit ratings could materially adversely affect the market price of the Notes and may increase our cost of capital.
- We may not have the ability to raise the funds necessary to finance the repurchase of the 2025 Notes, the 2026 Notes and the 2031 Notes upon a change of control event as will be required.
- Some or all of the Guarantees may be released automatically.