| PART I |
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| Item 1. | Business | 5 |
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| Item 1A. | Risk Factors | 13 |
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| Item 1B. | Unresolved Staff Comments | 33 |
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| Item 1C. | Cybersecurity | 33 |
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| Item 2. | Properties | 35 |
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| Item 3. | Legal Proceedings | 35 |
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| Item 4. | Mine Safety Disclosures | 35 |
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| PART II |
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| Item 5. | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | 35 |
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| Item 6. | [Reserved] | 37 |
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| Item 7. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 37 |
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| Item 7A. | Quantitative and Qualitative Disclosures About Market Risk | 49 |
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| Item 8. | Financial Statements and Supplementary Data | 50 |
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| Item 9. | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure | 76 |
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| Item 9A. | Controls and Procedures | 77 |
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| Item 9B. | Other Information | 79 |
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| Item 9C. | Disclosure Regarding Foreign Jurisdictions that Prevent Inspections | 79 |
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| PART III |
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| Item 10. | Directors, Executive Officers and Corporate Governance | 79 |
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| Item 11. | Executive Compensation | 79 |
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| Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | 79 |
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| Item 13. | Certain Relationships and Related Transactions, and Director Independence | 79 |
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| Item 14. | Principal Accounting Fees and Services | 79 |
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| PART IV |
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| Item 15. | Exhibits and Financial Statement Schedules | 80 |
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| Signatures | 86 | |
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Special Note Regarding Forward-Looking Statements
This Report contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (set forth in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). In particular, statements pertaining to our trends, liquidity, capital resources, and the healthcare industry and the healthcare real estate markets and opportunity, among others, contain forward-looking statements. You can identify forward-looking statements by the use of forward-looking terminology including, but not limited to, “believes,” “expects,” “may,” “will,” “should,” “seeks,” “approximately,” “intends,” “plans,” “estimates” or “anticipates” or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions.
Forward-looking statements involve numerous risks and uncertainties, and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods which may be incorrect or imprecise and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements:
| ● | difficulties in identifying healthcare facilities to acquire (due to increased cost of capital, competition or otherwise) and completing such acquisitions; |
| ● | defaults on or non-renewal of leases by tenants; |
| ● | our ability to collect rents; |
| ● | increases in interest rates and increased operating costs; |
| ● | macroeconomic and geopolitical factors, including, but not limited to, inflationary pressures, interest rate volatility, distress in the banking sector, global supply chain disruptions and ongoing geopolitical conflicts and war; |
| ● | an epidemic or pandemic (such as the COVID-19 pandemic), and the measures that international, federal, state and local governments, agencies, law enforcement and/or health authorities implement to address it; |
| ● | our ability to satisfy the covenants in our existing and any future debt agreements; |
| ● | decreased rental rates or increased vacancy rates, including expected rent levels on acquired properties; |
| ● | adverse economic or real estate conditions or developments, either nationally or in the markets in which our facilities are located; |
| ● | our failure to generate sufficient cash flows to service our outstanding obligations; |
| ● | our ability to satisfy our short and long-term liquidity requirements; |
| ● | our ability to deploy the debt and equity capital we raise; |
| ● | our ability to hedge our interest rate risk; |
| ● | our ability to raise additional equity and debt capital on terms that are attractive or at all; |
| ● | our ability to make distributions on shares of our common and preferred stock or to redeem our preferred stock; |
| ● | expectations regarding the timing and/or completion of any acquisition; |
| ● | expectations regarding the timing and/or completion of dispositions, and the expected use of proceeds therefrom; |
| ● | general volatility of the market price of our common and preferred stock; |
| ● | changes in our business or our investment or financing strategy; |
| ● | our dependence upon key personnel, whose continued service is not guaranteed; |
| ● | our ability to identify, hire and retain highly qualified personnel in the future; |
| ● | the degree and nature of our competition; |
| ● | changes in healthcare laws, governmental regulations, tax laws and similar matters; |
| ● | changes in current healthcare and healthcare real estate trends; |
| ● | changes in expected trends in Medicare, Medicaid and commercial insurance reimbursement trends; |
| ● | competition for investment opportunities; |
| ● | our failure to successfully integrate acquired healthcare facilities; |
| ● | our expected capital and tenant improvement expenditures; |
| ● | changes in accounting policies generally accepted in the United States of America (“GAAP”); |
| ● | lack of, or insufficient amounts of, insurance; |
| ● | other factors affecting the real estate industry generally; |
| ● | changes in the tax treatment of our distributions; |
| ● | our failure to maintain our qualification as a real estate investment trust (“REIT”) for U.S. federal income tax purposes; |
| ● | our ability to qualify for the safe harbor from the 100% prohibited transactions tax under the REIT rules with respect to our property dispositions; and |
| ● | limitations imposed on our business due to, and our ability to satisfy, complex rules relating to REIT qualification for U.S. federal income tax purposes. |
See Item 1A. Risk Factors in this Report for further discussion of these and other risks, as well as the risks, uncertainties and other factors discussed in this Report and identified in other documents we may file with the United States Securities and Exchange Commission (the “SEC”) from time to time. You should carefully consider these risks before making any investment decisions in our company. New risks and uncertainties may also emerge from time to time that could materially and adversely affect us. While forward-looking statements reflect our good faith beliefs, they are not guarantees of future performance. We disclaim any obligation to update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes after the date of this Report, except as required by applicable law. You should not place undue reliance on any forward-looking statements that are based on information currently available to us or the third parties making the forward-looking statements.
