Session M13: the Senior Living Universe: Not-For-Profit & for Profit

SESSION M13: THE SENIOR LIVING UNIVERSE: NOT-FOR-PROFIT & FOR PROFIT

May 22, 2017

PRESENTED BY Tom Meyers Managing Director Ziegler

B.C. Ziegler and Company | Member of SIPC & FINRA DISCLOSURE LANGUAGE 1. The information contained herein is intended to be general, factual, and educational in nature, and does not reflect any assumptions, opinions, or views of B.C. Ziegler and Company (“Ziegler”) with respect to the recipient municipal entity’s or obligated person’s particular situation. Further, a) Ziegler is not recommending an action to the municipal entity or obligated person; b) Ziegler is not acting as an advisor to the municipal entity or obligated person and does not owe a fiduciary duty pursuant to Section 15B of the Exchange Act to the municipal entity or obligated person with respect to the information and material contained in this communication; c) Ziegler is acting for its own interests; and d) The municipal entity or obligated person should discuss any information and material contained in this communication with any and all internal or external advisors and experts that the municipal entity or obligated person deems appropriate before acting on this information or material.

2. B.C. Ziegler and Company (“Ziegler”) seeks to serve as an underwriter on a future transaction and not as a financial advisor or municipal advisor. The information provided is for discussion purposes only in anticipation of being engaged to serve as underwriter. AGENDA

TOPIC 1 • SELECT SENIOR LIVING TRENDS FOR 2017

TOPIC 2 • NOT-FOR-PROFIT SENIOR LIVING GROWTH TRENDS AND SCOPE

TOPIC 3 • FOR-PROFIT COMPETITION, GROWTH TRENDS AND SCOPE

TOPIC 4 • SENIOR LIVING CAPITAL MARKETS

3 TOPIC 1: SELECT SENIOR LIVING TRENDS FOR 2017 2016-2017

DRIVERS FOR NFP SENIOR LIVING Complexities of CONSOLIDATION Healthcare Leadership Turnover

Competition

Ability to Attract Talent/Wrkforce Mgmt.

Technology Demands

Reinvestment Requirements

Hospital Consolidation Pressure

Financial Pressure

Diversify Service Lines

Growth Capital Needs Source: Ziegler Investment Banking 5 DEMOGRAPHICS DEFINE THE MARKET LOOKING TO THE FUTURE

100,000 We Are 90,000 Here 80,000 70,000 60,000 50,000 40,000 (In Thousands) 30,000 20,000 10,000 0 2010 2015 2020 2025 2030 2035 2040 2045 2050

65 Years & Over 75 Years & Over 85 Years & Over 100 Years & Over

Source: U.S. Census Bureau National Population Projections (released 2008, based on Census 2000) 6 COMPLEXITIES OF HEALTHCARE

Sophistication • Do you have the scale needed to compete in the local healthcare marketplace? •What expertise do you have regarding the ACA and payment reform (bundles, etc.)? • Are you technologically advanced with data analytics, outcome-based reporting, etc.?

Partnerships • Are you able to compete and be a player in the new models of care emerging as a result of the ACA? • Are you engaged in any joint ventures, post-acute networks or bundled-payment agreements?

7 ZIEGLER CFO HOTLINE: POST-ACUTE ACTIVITIES

Is your organization experiencing any of the following regarding your healthcare setting? (% Yes Responses)

Patients with a higher level of acuity 86.5% than in years' past

Decreased length of stays in skilled 84.6% care

Narrowing of networks from area 51.9% hospitals, physician groups

Increase in consumers w/ treatment 44.2% plans that skip skilled care altogether

0% 20% 40% 60% 80% 100%

Source: Ziegler CFO Hotline, August 2016 8 SN REVENUE & PATIENT MIX

Source: National Investment Center for the Seniors Housing & Care Industry | Skilled Nursing Data Report; data through June 2016 9 INTERLUDE RESTORATIVE SUITES MINNESOTA • Three hospital/senior living partners • Interlude™ Restorative Suites is a new, holistic model of transitional care - upscale, soothing environment with superior, clinically-integrated care, in-patient rehabilitation, and guest-focused hospitality for the body and mind alike

10 THE CHANGING FACE OF FOR-PROFIT POST-ACUTE

• SNF market is bifurcating into newer physical plants w/ ST Medicare rehab focus vs. older SNFs focusing on long- term Medicaid patients

11 PRESSURES IMPACTING SKILLED NURSING OCCUPANCY FIVE-YEAR LOW IN Q4 2016

81.8%

Source: National Investment Center for the Seniors Housing & Care Industry | Skilled Nursing Data Report; data through December 31, 2016 12 STAFFING: A COMPLEX ISSUE Will need to • Many factors contributing to challenges: recruit 1.2 –An aging population; retirements million – Increase in minimum wages direct care staff by 2025 – Department of labor overtime ruling – Pressure on immigration rules – Growth among for-profits

• Many providers are working together, partnering with schools and universities

• Efforts to better understand work preferences, traits of the Millennials

• Not just your workforce…workforce of your partners (e.g. impact on construction costs)

Source: Ziegler Investment Banking; Argentum 13 WORKFORCE: A STRATEGIC IMPERATIVE

Has your organization had to…

Work w/ temp agencies to fill direct 53.0% care staff vacancies

Limit admissions b/c of staffing 15.6% shortages

0% 10% 20% 30% 40% 50% 60% Limit admissions b/c of staffing shortages Work w/ temp agencies to fill direct care staff vacancies

Source: Ziegler CFO Hotline, June 2016 14 DISRUPTORS & CATALYSTS DEMAND GREATER SCALE AND SOPHISTICATION • Largest multi-sites are adding corporate-level positions in response – Pushing some added costs down to affiliates

• Corporate areas of specialty being added by the LeadingAge Ziegler 150 in 2015 (in order of mentions) 1. Chief Clinical/Health Officer 2. Chief Information/Technology Officer 3. Chief Talent/HR Officer 4. Business Development/Strategy Officer 5. Chief Compliance Officer 6. Philanthropy/Foundation Director

Source: 2016 LeadingAge Ziegler 150 (Preliminary data) 15 UNIT GROWTH NOT JUST FROM BUILDING NEW UNITS, BUT ALSO FROM SYSTEM GROWTH • Currently the primary mode of growth for residential Affiliations settings among not-for- profit senior living providers

– Systems coming together Acquisitions – Two smaller organizations joining to form larger Transitions Sponsorship Sponsorship

Dispositions – Single-sites joining a system

16 NOT-FOR-PROFIT CHANGE OF OWNER/SPONSOR AFFILIATIONS, DISPOSITIONS, ACQUISITIONS, CLOSURES Total by # of Transactions & # of Communities

100 91 80 80 63 60

40 36 36 24 60 15 52 55 20 34 29 22 12 0 2010 2011 2012 2013 2014 2015 2016 Transactions Market-Rate Communities

Note: Includes market-rate communities; excludes government subsidized Source: Ziegler Investment Banking 12/31/16 17 NOT-FOR-PROFIT CHANGE OF OWNER/SPONSOR AFFILIATIONS, DISPOSITIONS, ACQUISITIONS, CLOSURES NFP to NFP Sponsorship Transitions Only 40 35 36 30 25 20 18 15 12 11 10 7 19 5 4 14 5 11 77 5 4 0 2010 2011 2012 2013 2014 2015 2016 Transactions Market-Rate Communities

Note: Includes market-rate communities; excludes government subsidized Source: Ziegler Investment Banking 12/31/16 18 SELECT NFP LPC SPONSORSHIP TRANSITIONS: 2016/17 Year Organization New Sponsor FP/NFP State 2017 Cadbury at Lewes Springpoint Senior Living NFP to NFP DE 2016 Franciscan Oaks Springpoint Senior Living FP to NFP NJ 2016 Rockhill Community & Lutheran Community at Telford NFP to NFP PA 2016 Bishop Spencer Place St. Luke’s Hospital NFP to NFP MO 2016 Westchester Meadows Bethel Methodist Home NFP to NFP NY 2016 LutheranCare Presbyterian Homes & Services NFP to NFP NY 2016 Episcopal Church Home Episcopal Retirement Services NFP to NFP KY 2016 Wesley Manor BHI Senior Living NFP to NFP IN 2016 Glacier Hills Trinity Senior Communities NFP to NFP MI 2016 Asbury Place Asbury Communities NFP to NFP TN 2016 Shenango Presbyterian Presbyterian SeniorCare NFP to NFP PA 2016 Birch Hill Terrace RiverWoods NFP to NFP NH 2016 Sacred Heart Village Nazareth Home NFP to NFP KY 2016 ABHOW & be.group Human Good NFP to NFP CA

Source: Ziegler Investment Banking 19 TOPIC 2: NOT-FOR-PROFIT SENIOR LIVING GROWTH TRENDS AND SCOPE TODAY’S RETIREMENT OPTIONS A LOOK AT SENIORS HOUSING SUPPLY % NFP

Life Plan Communities • 1,961 communities 600,000 units 80%

Adult Day Programs • 4,800 programs 289,400 participants/day 51%

Hospice • 4,000 agencies 1.34 mill discharged/yr. 26%

Nursing Homes • 15,600 homes 1,663,000 units 24%

Freestanding Memory • 1,100 communities 53,000 units 22% Care Assisted Living/ • 30,200 communities 1million residents 17% Residential Care

Home Health • 12,400 agencies 4.9 mill discharged/yr. 15%

IL Housing • 1,100 properties 184,000 units 3%

Sources: Ziegler National CCRC Listing & Profile, LeadingAge, NIC MAP® Data and Analysis Service, The National Center for Health Statistics, Centers for Medicare and Medicaid Services 21 TYPICAL LIFE PLAN COMMUNITY PROFILE

NFP: 80% FP: 20%

# Affiliated w/a Single-sites: 38.1% Health System: LPCs 108 Multi-Sites: 61.9%

Avg # of Units: 283

Source: Ziegler National CCRC Database 22 2016 LEADINGAGE ZIEGLER 150

• Represents the Largest 150 Not-for-Profit Sr Living Multi-site Providers

• Range from 18,527 market-rate units (National Senior Campuses) to 588 units (St. John’s Lutheran Ministries)

• Represents a total of 1,253 market-rate Accessible via Ziegler & LeadingAge websites communities

Source: 2016 LeadingAge Ziegler 150 23 2016 LZ 150 ANALYSIS OF THE DATA: SYSTEM HEADQUARTERS HEADQUARTERS’ LOCATIONS BY SIZE (TOTAL UNITS) TopTopTop 502510015010

3,250+ Units (Top 10) 1,350+ Units (Top 50) 780+ Units (Top 100) 1,970+ Units (Top 25) 588+ Units (Top 150)

Source: 2016 LeadingAge Ziegler 150 Publication (data as of 12/31/15) 24 2016 LEADINGAGE ZIEGLER 150 THE NATION'S LARGEST NOT-FOR-PROFIT MULTI-SITE SENIOR LIVING ORGANIZATIONS RANKED BY TOTAL SENIOR LIVING UNITS

Units Communities (as of 12/31/15) (as of 12/31/15) 2016 Rank 2015 Rank System Name State Total ILU ALU NCB Total LPC IL AL NH 1 1 National Senior Campuses MD 18,527 15,873 1,370 1,284 15 15 0 0 0 2 2 The Evangelical Lutheran Good Samaritan Society SD 17,822 5,013 2,286 10,523 168 69 8 8 83 3 3 ACTS Retirement Services, Inc. PA 7,933 5,591 901 1,441 21 21 0 0 0 4 4 Presbyterian Homes and Services MN 7,056 3,503 2,127 1,426 42 12 23 4 3 5 NR Benedictine Health MN 5,270 625 1,484 3,161 39 24 1 5 9 6 5 Covenant Retirement Communities IL 5,015 3,146 885 984 18 14 1 2 1 7 NR Ascension Senior Living MO 4,748 925 833 2,990 26 82214 8 6 Retirement Housing Foundation CA 4,099 2,636 868 595 18 9810 9 7 Lifespace Communities, Inc. IA 4,052 3,069 154 829 12 12 0 0 0 10 NR Trinity Senior Living Communities MI 3,745 1,184 633 1,928 20 54110 11 8 The Kendal Corporation PA 3,726 2,522 666 538 15 13 2 0 0 12 NR Presence Life Connections IL 3,558 1,021 369 2,168 21 61014 13 11 Presbyterian Senior Living PA 3,434 1,808 499 1,127 20 12 6 2 0 14 9 Lutheran Senior Services MO 3,326 1,614 709 1,003 11 8012 15 12 Cornerstone Affiliates CA 3,318 1,984 646 688 12 12 0 0 0 16 10 Westminster Communities of Florida FL 3,254 2,027 476 751 9 9000 17 14 Ohio Presbyterian Retirement Services OH 3,178 1,686 574 918 12 12 0 0 0 18 17 Asbury Communities MD 2,914 1,932 335 647 6 5001 19 15 Pacific Retirement Services OR 2,856 2,116 333 407 9 8100 20 16 Front Porch Communities and Services CA 2,782 1,873 369 540 10 5500 21 18 Presbyterian Manors of Mid-America, Inc. KS 2,471 926 590 955 18 16 0 1 1 22 20 Masonic Villages of the Grand Lodge of Pennsylvania PA 2,434 1,496 254 684 5 3101 23 19 Diakon Lutheran Social Ministries PA 2,419 919 529 971 9 9000 24 21 Volunteers of America VA 2,404 531 723 1,150 25 4399 25 13 Ecumen MN 2,393 290 1,477 626 36 04248

Source: Preliminary 2016 LeadingAge Ziegler 100 Publication (data as of 12/31/15) 25 2016 LEADINGAGE ZIEGLER 150 THE NATION'S LARGEST NOT-FOR-PROFIT MULTI-SITE SENIOR LIVING ORGANIZATIONS RANKED BY TOTAL SENIOR LIVING UNITS

Units Communities (as of 12/31/15) (as of 12/31/15) 2016 Rank 2015 Rank System Name State Total ILU ALU NCB Total LPC IL AL NH 26 22 Christian Homes, Inc. MO 2,104 386 244 1,474 13 11 0 1 1 27 23 Shell Point FL 2,085 1,368 389 328 2 2000 28 24 Willow Valley Communities PA 2,027 1,530 222 275 3 3000 29 25 Springpoint Senior Living, Inc. NJ 1,967 1,429 271 267 6 6000 30 26 Franciscan Communities, Inc. IL 1,946 733 438 775 8 4130 31 27 Augustana Care MN 1,941 0 1,160 781 18 00126 32 31 Otterbein Senior Lifestyle Choices OH 1,919 730 382 807 13 5008 33 28 Concordia Lutheran Ministries PA 1,898 554 965 379 12 5061 34 30 National Church Residences OH 1,860 779 539 542 12 5241 35 29 Senior Quality Lifestyles Corporation TX 1,858 1,130 419 309 6 6000 36 32 Christian Care Companies AZ 1,842 1,434 342 66 5 1310 37 48 Greencroft Communities IN 1,779 635 534 610 8 7100 38 36 Hebrew SeniorLife MA 1,764 659 159 946 4 2101 39 NR ArchCare NY 1,738 1,337 59 342 5 1400 40 33 Elim Care, Inc. MN 1,707 197 452 1,058 24 04911 41 34 Homewood Retirement Centers MD 1,694 965 278 451 5 4100 42 35 Providence Life Services IL 1,603 665 360 578 8 3212 43 65 Presbyterian SeniorCare PA 1,593 398 520 675 7 4021 44 49 Bethesda Health Group, Inc. MO 1,588 708 18 862 10 0604 45 38 The New Jewish Home fka Jewish Home Lifecare NY 1,585 24 0 1,561 4 0103 46 40 Episcopal Senior Communities CA 1,572 1,076 120 376 6 6000 47 42 Loretto NY 1,498 282 593 623 8 1241 48 41 Magnolia Manor GA 1,483 339 335 809 8 2411 49 43 Bethesda Senior Living Communities CO 1,482 155 1,327 01702150 50 NR Covenant Health MA 1,476 0 364 1,112 12 0048

Source: Preliminary 2016 LeadingAge Ziegler 100 Publication (data as of 12/31/15) 26 2016 LEADINGAGE ZIEGLER 150 THE NATION'S LARGEST NOT-FOR-PROFIT MULTI-SITE SENIOR LIVING ORGANIZATIONS RANKED BY TOTAL SENIOR LIVING UNITS

Units Communities (as of 12/31/15) (as of 12/31/15) 2016 Rank 2015 Rank System Name State Total ILU ALU NCB Total LPC IL AL NH 51 53 Lutheran Life Ministries IL 1,473 408 370 695 6 6000 52 37 Buckner Retirement Services, Inc TX 1,468 845 267 356 7 5200 53 45 Mississippi Methodist Senior Services, Inc. MS 1,452 778 354 320 12 2802 54 46 WesleyLife IA 1,441 684 302 455 7 7000 55 47 Holland Home MI 1,434 723 450 261 4 2011 56 44 Presbyterian Homes IL 1,423 841 217 365 5 3110 57 39 Eskaton CA 1,409 335 648 426 12 2 2 5 3 58 50 be.group CA 1,344 844 269 231 7 6 0 1 0 59 57 SantaFe Senior Living, Inc. FL 1,306 876 316 114 3 3 0 0 0 60 52 Baptist Village Communities OK 1,285 779 181 325 8 3 5 0 0 61 54 Masonicare CT 1,264 458 277 529 5 1 1 1 2 62 60 Friendship Senior Options IL 1,243 770 182 291 2 2 0 0 0 63 51 Wesley Enhanced Living PA 1,235 629 246 360 6 5 0 1 0 64 59 Phoebe - Devitt Homes PA 1,230 374 175 681 4 4 0 0 0 65 55 Lutheran Services Carolinas, Inc NC 1,230 244 254 732 9 1 1 1 6 66 58 Virginia United Methodist Homes, Inc. VA 1,227 514 435 278 7 6 0 1 0 67 74 United Church Homes, Inc. OH 1,227 310 193 724 9 5 1 0 3 68 61 American Baptist Homes of the Midwest MN 1,200 374 209 617 8 4 1 2 1 69 64 SpiriTrust Lutheran fka Lutheran Social Services of South Central Pennsylvania PA 1,191 554 303 334 6 6 0 0 0 70 62 Virginia Baptist Homes VA 1,179 741 221 217 4 4 0 0 0 71 98 BHI Senior Living, Inc. IN 1,179 257 601 321 4 4 0 0 0 72 63 Integrace MD 1,150 645 228 277 4 3 0 1 0 73 66 Heritage Communities fka United Methodist Memorial Home IN 1,124 263 513 348 3 3 0 0 0 74 67 Lutheran SeniorLife PA 1,106 472 192 442 7 2 5 0 0 75 70 Lutheran Homes of South Carolina SC 1,073 405 308 360 5 5 0 0 0

Source: Preliminary 2016 LeadingAge Ziegler 100 Publication (data as of 12/31/15) 27 2016 LEADINGAGE ZIEGLER 150 THE NATION'S LARGEST NOT-FOR-PROFIT MULTI-SITE SENIOR LIVING ORGANIZATIONS RANKED BY TOTAL SENIOR LIVING UNITS

Units Communities (as of 12/31/15) (as of 12/31/15) 2016 Rank 2015 Rank System Name State Total ILU ALU NCB Total LPC IL AL NH 76 78 Northern California Presbyterian Homes and Services, Inc. CA 1,062 818 103 141 4 3 1 0 0 77 68 United Methodist Homes NY 1,055 366 263 426 4 3010 78 85 Eventide MN 1,054 71 402 581 6 1131 79 69 Walker Methodist MN 1,034 493 165 376 6 1410 80 71 The United Methodist Homes of New Jersey NJ 1,026 88 686 252 5 1040 81 72 Elant NY 995 148 144 703 6 1014 82 73 Blue Skies of Texas TX 988 732 129 127 2 2000 83 106 Methodist Retirement Communities TX 974 433 288 253 5 5000 84 76 The Presbyterian Homes, Inc. NC 958 636 133 189 3 3000 85 77 United Church Homes and Services NC 954 536 90 328 3 3000 86 75 Presby's Inspired Life PA 940 474 206 260 4 2011 87 79 The United Methodist Retirement Homes, Inc. NC 932 622 108 202 3 3000 88 80 Menno Haven PA 920 531 177 212 3 2100 89 NR Vista Prairie Communities MN 917 100 817 01000100 90 81 Liberty Lutheran Services PA 902 384 301 217 4 3010 91 101 Morningside Ministries TX 890 385 182 323 3 3000 92 82 VMP WI 889 447 205 237 2 2000 93 83 Westminster Ingleside Retirement Communities DC 885 607 113 165 3 3000 94 84 Oakwood Lutheran Senior Ministries WI 885 588 160 137 2 2000 95 88 Presbyterian Communities of South Carolina SC 881 282 315 284 5 5000 96 97 Cedar Community (Benevolent Corporation Cedar Community) WI 872 417 240 215 6 1221 97 90 Christian Care Communities, Inc. KY 864 185 96 583 5 3110 98 86 St. Ann's Community NY 863 246 75 542 2 2000 99 87 Living Branches PA 850 461 246 143 3 2010 100 109 Sun Health Senior Living LLC AZ 844 637 61 146 3 3000

Source: Preliminary 2016 LeadingAge Ziegler 100 Publication (data as of 12/31/15) 28 2016 LEADINGAGE ZIEGLER 150 THE NATION'S LARGEST NOT-FOR-PROFIT MULTI-SITE SENIOR LIVING ORGANIZATIONS RANKED BY TOTAL SENIOR LIVING UNITS

Units Communities (as of 12/31/15) (as of 12/31/15) 2016 Rank 2015 Rank System Name State Total ILU ALU NCB Total LPC IL AL NH 101 89 Presbyterian Communities and Services TX 843 329 134 380 2 2000 102 91 Simpson Senior Services PA 839 494 153 192 3 3000 103 92 Goodwin House Incorporated VA 832 583 100 149 2 2000 104 56 Presbyterian Villages of Michigan MI 832 542 200 90 7 1600 105 93 Los Angeles Jewish Home CA 831 50 271 510 3 1101 106 95 Givens Estates NC 818 597 77 144 2 2000 107 94 Luthercare PA 811 474 126 211 3 2001 108 96 Heritage Ministries NY 808 253 122 433 9 1323 109 99 Western Home Communities IA 790 420 238 132 3 1200 110 100 The Ohio Masonic Home OH 781 338 249 194 3 2100 111 104 Sunnyside Presbyterian Home VA 779 500 129 150 3 3000 112 103 Lutheran Social Services of Michigan MI 770 294 120 356 5 1202 113 105 Life Enriching Communities OH 763 467 137 159 2 2000 114 115 Wesley Willows IL 749 488 170 91 2 1100 115 107 Garden Spot Village PA 747 542 86 119 2 1001 116 108 Christian Care Senior Living Communities TX 747 386 138 223 2 2000 117 110 Christian Living Ventures CO 744 414 152 178 3 3000 118 112 Landis Communities PA 743 491 149 103 3 1110 119 111 Mather LifeWays IL 741 624 46 71 3 2100 120 113 Wellspring Lutheran Services MI 736 128 224 384 10 1324 121 114 Luther Manor WI 732 366 156 210 2 1010 122 128 National Lutheran Communities & Services MD 713 417 120 176 3 2010 123 116 Lutheran Homes Society OH 702 142 171 389 5 2102 124 NR Methodist ElderCare Services OH 700 338 256 106 2 2000 125 NR Christian Village Communities OH 698 327 245 126 2 2000

Source: Preliminary 2016 LeadingAge Ziegler 100 Publication (data as of 12/31/15) 29 2016 LEADINGAGE ZIEGLER 150 THE NATION'S LARGEST NOT-FOR-PROFIT MULTI-SITE SENIOR LIVING ORGANIZATIONS RANKED BY TOTAL SENIOR LIVING UNITS

Units Communities (as of 12/31/15) (as of 12/31/15) 2016 Rank 2015 Rank System Name State Total ILU ALU NCB Total LPC IL AL NH 126 134 Sunset Manor, Inc. (Sunset Retirement Communities and Services) MI 698 304 225 169 4 2011 127 117 Saint Therese MN 698 300 76 322 3 2010 128 123 Messiah Lifeways PA 695 354 157 184 2 1100 129 118 Episcopal SeniorLife Communities NY 690 377 131 182 8 0521 130 119 Wesley Homes WA 688 453 87 148 2 2000 131 NR Christian Health Care Center NJ 681 297 92 292 2 1100 132 121 CRISTA Senior Ministries WA 680 382 131 167 2 1100 133 124 Lutheran Social Ministries of New Jersey, Inc. NJ 678 281 130 267 2 1001 134 126 Vincentian Collaborative Services PA 675 66 82 527 4 2002 135 127 Presbyterian Retirement Communities Northwest WA 668 474 132 62 4 3100 136 129 Maple Knoll Communities OH 667 369 91 207 2 2000 137 130 LifeStream Complete Senior Living AZ 661 357 144 160 5 1202 138 146 Albright Care Services PA 658 279 89 290 2 2000 139 120 St Andrew's Resources for Seniors MO 652 334 135 183 4 2101 140 132 LindenGrove, Inc. WI 650 189 461 9 0054 141 122 Masonic Homes of Kentucky, Inc. KY 638 248 147 243 3 1101 142 133 The Loomis Communities MA 634 426 74 134 4 3100 143 131 United Methodist Homes, Inc. CT 627 90 417 120 4 1030 144 137 Baptist Retirement Homes of North Carolina, Inc. NC 621 272 140 209 4 2020 145 136 Porter Hills MI 619 353 116 150 3 1110 146 125 Lutheran Life Villages IN 616 150 70 396 3 1002 147 138 Smith Senior Living IL 614 325 143 146 2 2000 148 NR Moorings Park FL 598 416 76 106 2 1100 149 135 Deaconess Abundant Life Communities MA 598 377 138 83 5 3110 150 141 St. John's Lutheran Ministries MT 588 145 257 186 5 4100

Source: Preliminary 2016 LeadingAge Ziegler 100 Publication (data as of 12/31/15) 30 2016 LZ 150 “TOP 25” RATED SYSTEMS TOTAL REVENUE ($MM)

Total Revenue ($MM) $1,200

$1,000

$800

$600

$400

$200

Note: Metrics calculated from each respective borrower’s most recent audited financials or covenant compliance certificates. Springpoint’s financials not available publicly. 31 2016 LZ 150 “TOP 25” RATED SYSTEMS TOTAL REVENUE ($MM) Excludes Evangelical Lutheran Good Samaritan Society

Total Revenue ($MM) $400 $350 $300 $250 $200 $150 $100 $50 $0

Note: Metrics calculated from each respective borrower’s most recent audited financials or covenant compliance certificates. Springpoint’s financials not available publicly. 32 2016 LZ 150 GROWTH: GROWTH OF LARGEST 100 SYSTEMS, COMBINED UNIT MIX FROM 1980 (EXCLUDES EVANGELICAL LUTHERAN GOOD SAMARITAN SOCIETY)

60,000 Partial histories used if ILU ALU NCB All Units complete data was unavailable 55,000

50,000 All other organizations pre-1980 45,000

40,000

35,000

30,000 Units 25,000

20,000

15,000

10,000

5,000

0 1980 1985 1990 1995 2000 2005 2010 2015 Year Source: Preliminary 2016 LeadingAge Ziegler 100 Publication (data as of 12/31/15) 33 2016 LZ 150 SYSTEM PRIMARY GEOGRAPHIC CLASSIFICATIONS

Across Bi- or Tri- Single State National Metro Sub-metro States state State Region

3.3% 3.3%

10.0%

15.4% 18.6% 20.7%

28.7% Source: 2016 LeadingAge Ziegler 150 Publication (Preliminary data) 34 NFP SENIOR LIVING GROWTH & EVOLUTION IN 2017

Sponsorship Transitions

New Community HCBS Offerings Locations

Expansions/ NFP SL Joint Repositionings Growth Ventures

Source: Ziegler Investment Banking 35 GROWTH PLANS OVER THE NEXT TWO YEARS

Percentage of LZ 150 who plan to grow through…

76.5% Expansion or repositioning of existing community 71.5%

36.0% New community locations (affiliations or development) 38.0%

0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 2016 2015

Source: 2015 & 2016 LeadingAge Ziegler 150 Publication s 36 NFP SUCCESS BEYOND RESIDENTIAL SETTINGS

70% of the LZ150 with HCBS are below $10 million annually in HCBS revenue Source: 2016 LeadingAge Ziegler 150 37 THE POTENTIAL NOT-FOR-PROFIT FULL-SERVICE SENIOR LIVING MODEL

Market Rate IL – hospitality focus Continuing Care at Home

Moderate Independent Living Home Health

Assisted Living Home Care Services Age Memory Care Concierge

Skilled Nursing, PACE post-acute Hospice Skilled Nursing, Medicaid Adult Day

Government Subsidized Home Maintenance Income

Maximization of partnerships in the region Source: Ziegler Investment Banking 38 TOPIC 3: FOR-PROFIT COMPETITION, GROWTH TRENDS AND SCOPE IN THE PIPELINE: SENIOR HOUSING CONSTRUCTION PROJECTS (5/18/17) SENIOR HOUSING DEVELOPERS SET SIGHTS ON PHOENIX…land near Phoenix…$40 million community called Park at Copper Creek Independent Living…135-unit community… pool and grilling area …bistro, theater, fitness center, beauty salon and spa, crafts, game rooms, library, and private dining…

MORE SENIOR HOUSING TAKING SHAPE NEAR ATLANTA …close to Atlanta…mixed-use project would include new senior housing…retail space, a daycare, an elementary school, and apartments…

ASSISTED LIVING COMMUNITY PLANNED IN OHIO …StoryPoint…communities in Michigan and Ohio, seeks to build a new community with Planned more than 200 independent living, assisted living, and memory care units,

SENIOR HOUSING PLANNED IN PHILLY…$147 million on a new community in Philadelphia. New Courtland Senior Services …build new housing and a care center for seniors.

WORKERS BREAK GROUND ON $27 MILLION SENIOR COMMUNITY IN GEORGIA …$27 million project…Savannah Quarters…10 acres…124 residents…spa and wellness center, farm-to-table dining, wine storage, a full-service salon…

MUSTANG CREEK ESTATES TO OPEN FIFTH DALLAS-AREA PROPERTY…$7.5 million assisted living and memory care community in Sachse, Texas…six homes that can house up to 16 seniors apiece…

SENIOR HOUSING COMING TOGETHER NEAR TEXAS A&M UNIVERSITY CAMPUS…159 senior living apartments…independent living, assisted living, and memory care units…14-acre wooded site…

DOMINION SENIOR LIVING BREAKS GROUND ON COMMUNITY IN SOUTH CAROLINA…$9.5 million senior living community…room for

In Progress 60 seniors in assisted living and memory care apartments.

CENTRAL IOWA TO GET MORE ASSISTED LIVING AND MEMORY CARE UNITS…The Willows of Marshalltown…58 assisted living and memory care units…$13.3 million…expected to open in the summer of 2018.

SENIOR LIFESTYLE CORPORATION TO OPEN COMMUNITY IN OHIO…Mason, Ohio…The Sheridan at Mason…accepting reservations for 101 studio, one- and two-bedroom apartment homes, which include assisted living and memory care units…access to chef-prepared meals, a bistro…

SENIOR LIVING COMMUNITY TO HOST GRAND OPENING IN SOUTHERN LOUISIANA…ceremony to celebrate its grand opening…

RENOVATIONS WRAP UP AT WISCONSIN COMMUNITY Samaritas Senior Living, formerly Luther Manor, has finished its first round of renovations…added 19 new private rehabilitation rooms…more phases to go…entire project is slated to finish by summer of next year. 40 Complete FOR-PROFITS DOMINATE THE BROADER SECTOR AND ARE RAPIDLY GROWING

For- 72% Profit

NFP 25.5%

Govt. 2.5%

Data Sources: Ziegler National CCRC Listing & Profile, LeadingAge, NIC MAP® Data and Analysis Service, The National Center for Health Statistics, Centers for Medicare and Medicaid Services 41 FOR-PROFIT DEVELOPMENT REMAINS STRONG

Seniors Housing Construction by Profit Status; MAP31 4Q05 – 1Q17 350

300 For-Profit

250

200

150

100

50 Not-For-Profit Number of Properties With Construction With Number of Properties

0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

42 Source: NIC MAP® Data & Analysis Service, as of 3/31/17 © National Investment Center for the Seniors Housing & Care Industry | www.NICMAP.org 42 FOR-PROFIT GROWTH NOT JUST AL/MEMORY CARE INDEPENDENT LIVING COMING ON STRONG Construction vs. Inventory; MAP31 Seniors Housing | 4Q05 – 1Q17 12%

For-Profit Assisted 10% Living*

* Excludes not-for-profits and CCRCs 8% For-Profit Independent 6% Living*

2% Not-for-Profits

0% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 43 Source: NIC MAP® Data & Analysis Service, as of 3/31/17 © National Investment Center for the Seniors Housing & Care Industry | www.NICMAP.org 43 NATIONAL OCCUPANCY IS GENERALLY HIGH

Seniors Housing Occupancy by Profit Status; MAP31 4Q05 – 1Q17 95%

93%

Not-For-Profit 91%

89%

For-Profit 87%

85%

83% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Source: NIC MAP® Data & Analysis Service, as of 3/31/17 © National Investment Center for the Seniors Housing & Care Industry | www.NICMAP.org 44 LIFE PLAN COMMUNITIES EVEN BIGGER ADVANTAGE CCRC Occupancy by Profit Status; MAP31 4Q05 – 1Q17 95%

93% Not-For-Profit

91%

4.94% 89%

87% For-Profit

85%

83% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Source: NIC MAP® Data & Analysis Service, as of 3/31/17 © National Investment Center for the Seniors Housing & Care Industry | www.NICMAP.org 45 LIFE PLAN COMMUNITIES BY STATE NOT-FOR-PROFIT VS FOR-PROFIT

7 31, 5 4 4, 0 6, 0 NH: 19, 3 64 VT: 2, 0 21, 5 7 3 49 41 MA: 31, 8 4 18, 0 5 0, 0 7 CT: 28, 11 71, 8 150 197,20 RI: 8, 5 2 19, 2 113 67 46 6 NJ: 39, 5 1 0 30 18 18 133 52 1 59,7 DE: 12, 6 1 11 27 74, 10 13 DC: 6, 1 65, 21 MD: 43, 6 20 11 21, 5 9 41 15 3 2 4 17 23 16 1 4 5 94 8 27 0 HI: 5, 2 109 37 Not-For-Profit For-Profit

Source: Ziegler Investment Banking as of 2/25/16 46 SENIOR LIVING SECTOR: FOR-PROFIT

HCR ManorCare, Toledo, OH

• 63 Communities in 29 States – AZ, CA, CO, CT, DE, FL, GA, IA, IN, KS, KY, MD, MI, MN, MO, NC, ND, NJ, NM, NV, OH, OK, PA, SC, SD, TX, VA, WA, WI

• 4,403 Total Units – 55+ Community – Independent Living – Assisted Living – Skilled Nursing www.hcr-manorcare.com –Memory Care

Source: Argentum 2016 Largest Senior Living Providers 47 SENIOR LIVING FP SECTOR: HCR MANORCARE

Indiana ManorCare Health Services-Indy South, Indianapolis Heartland Hospice Serving Terre Haute & Surrounding Counties ManorCare Health Services-Prestwick, Avon Heartland Hospice Serving Central Indiana, Indianapolis ManorCare Assisted Living of Summer Trace, Carmel ManorCare Health Services of Summer Trace, Carmel ManorCare Health Services-Anderson Heartland Home Health Care Serving Northeast Indiana, Fort Wayne Heartland Hospice Serving Northeast Indiana, Fort Wayne Heartland Hospice Serving North Central Indiana, Mishawaka

Kentucky Heartland Rehabilitation Services of KY-London Heartland Rehabilitation Services of KY-Edmonton Heartland Rehabilitation Services of KY-Glascow Heartland Rehabilitation Services of KY-Berea Heartland Rehabilitation Services of KY-Horse Cave Heartland Rehabilitation Services of KY-Richmond Heartland Rehabilitation Services of KY-Murray Arden Courts of Louisville Heartland of Louisville Heartland Rehabilitation Services of KY-Paducah Heartland Rehabilitation Services of KY-Alexandria

Source: www.hcr-manorcare.com 48 SENIOR LIVING FP SECTOR: HCR MANORCARE Ohio Ohio (cont’d) Heatland of Riverview, South Point The Village at Westerville (Ret. Ctr.) Heartland of Portsmouth Heartland of Westerville Heartland Hospice Serving Southern Ohio, Oak Hill Heatland Hospice Serving Central Ohio, Columbus Heartland Home Health Care Serving Southern Ohio, Heartland Home Health Care Serving Central Ohio, Lucasville Columbus Heartland Hospice Serving Southern Ohio, Lucasville Heartland of Dublin Heartland of Jackson Heartland of Uptown Westerville Arden Courts of Anderson Twp, Cincinnati Heartland of Urbana Heartland of Hillsboro Heartland of Marysville Heartland of Chillicothe Heartland of Piqua Heartland Hospice Serving Southwest Ohio, Cincinnati Heartland of Centerburg Heartland of Madeira Heartland of Greenville Ohio (Cont’d) Arden Courts of Kenwood, Cincinnati Heartland of Bellefontaine ManorCare Health Services-Rocky River, Heartland of Marietta Heartland of Marion Cleveland Heartland of Mt. Airy, Cincinnati Heartland Home Health Care Serving Central Ohio, ManorCare Health Services-Mayfield Heights Heartland of Woodridge, Fairfield Marion ManorCare Health Services-Euclid Beach, Cleveland Heartland of Woodridge (1), Fairfield Heartland Hospice Serving Central Ohio, Marion Heartland of Waterville Heartland Hospice Serving Central Ohio, Circleville Heartland of Indian Lake (Rehab Ctr). Lakeview ManorCare Health Services-Willoughby Heartland of Fairfield, Pleasantville ManorCare Health Services-Belden Village, Canton Heartland of Mentor Heartland of Centerville Heartland of Bucyrus Heartland Rehabilitation Services of OH-Perrysburg Heartland of Miamisburg Heartland Hospice Serving Northeast Ohio, Akron Heartland of Perrysburg Heartland of Kettering ManorCare Health Services-Barberton Perrysburg Commons Heatland Hospice Serving Miami Valley, Kettering ManorCare Health Services-Akron Heartland Health Care Perrysburg Heartland – Beavercreek, Dayton Arden Courts of Bath, Akron Heartland Rehabilitation Services of OH-Arrowhead, Heartland Rehabilitation Services of OH-Grove City Heartland of Twinsburg Maumee Heartland of Eaton ManorCare Health Services-Parma, Cleveland Heartland of Wauseon Hartland of Victorian Village, Columbus Arden Courts of Parma, Cleveland Heartland Rehabilitation Services of OH-Oregon Heartland Rehabilitation Services of OH-ORS Newark Heartland Home Health Care Serving Northeast Ohio, Heartland of Oregon Heartland Home Health Care Serving Central Ohio, Independence Heartland Rehabilitation Services of OH-Westgate, Newark Heartland Hospice Serving Northeast Ohio, Toledo Heartland of Lansing, Bridgeport Independence Heartland Hospice Serving Northwest Ohio, Perrysburg Heartland of Springfield, Springfield Heartland Hospice Serving Northwest Ohio, Fremont Heartland - Holly Glen, Toledo Heartland Rehabilitation Services of OH-New Albany, Arden Courts of Chagrin Falls Heartland of ProMedica, Sylvania Columbus ManorCare Health Services-North Olmsted Heartland Health Care Center-Canton (1), Canton Source: www.hcr-manorcare.com Arden Courts of Westlake Heartland Health Care Center-Canton, Canton 49 Illinois Heartland Hospice Serving Fairview Heights Heartland Health Care Center-Champaign SENIOR LIVING FP SECTOR: Heartland Health Care Center-Decatur Heartland Health Care Center-Paxton Heartland Health Care Center-Normal HCR MANORCARE ManorCare Health Services-Kankakee Riverview Senior Living Community, East Peoria Minnesota Heartland Health Care Center-Riverview, East Peoria Heartland Hospice Serving Minnesota South, Rochester Heartland Health Care Center-Peoria Heartland Home Health Care Serving Twin Cities, Roseville Heartland Hospice Serving Chicagoland South, Frankfort Heartland Hospice Serving Twin Cities, Roseville ManorCare Health Services-South Holland Heartland Hospice Serving Minnesota North, Sauk Rapids Arden Courts of South Holland Heartland Hospice Serving Minnesota North, Brainerd ManorCare Health Services-Homewood Arden Courts of Hazel Crest Heartland Health Care Center-Macomb Heartland Health Care Center-Henry Ardent Courts of Palos Heights ManorCare Health Services-Palos Heights East ManorCare Health Services-Palos Heights West ManorCare Health Services-Oak Lawn East Wisconsin ManorCare Health Services-Oak Lawn West ManorCare Health Services-Kenosha ManorCare Health Services-Hinsdale Heartland Home Health Care Serving Southeastern Wisconsin, Kenosha ManorCare Health Services-Westmont Heartland Hospice Serving Southeastern Wisconsin, Kenosha ManorCare Health Services-Naperville Heartland Hospice Serving Southeastern Wisconsin, Milwaukee Heartland Hospice Serving Chicagoland Central, Westmont Heartland Home Health Care Serving Southeastern Wisconsin, Milwaukee Heartland Health Care Center-Galesburg ManorCare Health Services-Pewaukee, Waukesha Arden Courts of Glen Ellyn ManorCare Health Services-Wilmette Heartland Hospice Serving South Central Wisconsin, Madison Ardent Courts of Geneva ManorCare Health Services-Platteville Arden Courts of Elk Grove, Elk Grove Village Heartland Hospice Serving East Central Wisconsin, Fond du Lac ManorCare Health Services-Elk Grove Village ManorCare Health Services-Fond du Lac Arden Courts of Northbrook ManorCare Health Services-Waterloo ManorCare Health Services-Northbrook ManorCare Health Services-Appleton ManorCare Health Services-Arlington Heights Heartland Hospice Serving Northeastern Wisconsin, DePere ManorCare Health Services-Rolling Meadows Heartland Home Health Care Serving Northeastern Wisconsin, DePere ManorCare Health Services-Elgin ManorCare Health Services-East Green Bay Heartland Hospice Serving Chicagoland North, Northbrook ManorCare Health Services-West Green Bay ManorCare Health Services-Libertyville ManorCare Health Services-Shawano Heartland Hospice Serving Quad Cities, Moline Heartland Hospice Serving Central Wisconsin, Stevens Point Heartland Health Care Center-Moline Heartland Home Health Care Serving North Central Illinois & Southern Wisconsin, Rockford Source: www.hcr-manorcare.com 50 SENIOR LIVING FP SECTOR: HCR MANORCARE Michigan Heartland Rehabilitation Services of MI-Bedford, Lambertville Heartland Health Care Center-Allen Park Heartland Health Care Center-Three Rivers Heartland Health Care Center-Ann Arbor Heartland Hospice Serving Ann Arbor Heartland Home Health Care Center-Ann Arbor Heartland Health Care Center-Dearborn Heights Heartland Health Care Center-Jackson Heartland Health Care Center-Plymouth Heartland Health Care Center-Livonia Michigan (cont’d) Heartland Health Care Center-Grosse Pointe Woods Arden Courts of Livonia Heartland Health Care Center-Ionia Heartland Health Care Center-Livonia NE Heartland Health Care Center-Crestview, Wyoming Heartland Hospice Serving Metropolitan Detroit, Southfield Heartland Health Care Center-Grand Rapids Heartland Home Health Care Serving Metropolitan Detroit, Southfield Heartland Hospice Serving West Michigan, Grand Rapids Heartland Hospice Serving Southwest Michigan, Portage Heartland Home Health Care Serving West Michigan, Grand Rapids Arden Courts of Bingham Farms Heartland Health Care Center-Greenview, Grand Rapids Ardent Courts of Sterling Heights Heartland Health Care Center-Saginaw Heartland West Bloomfield Heartland Home Health Care Serving The Thumb, Caro Marvin & Betty Danto Health Care Center, West Bloomfield Heartland Health Care Center-Knollview, Muskegon Heartland Health Care Center-Bloomfield Hills Heartland Health Care Center-Hampton, Bay City Heartland Health Care Center-Sterling Heights Heartland Hospice Serving Northeastern Michigan, Bay City Heartland Health Care Center-Battle Creek Heartland Health Care Serving Northeastern Michigan, Bay City Heartland Health Care Center-Kalamazoo Heartland Home Health Care Serving Northeastern Michigan, Bay City Heartland Health Care Center-Oakland, Troy Heartland Home Health Care Serving Central Michigan, Mt. Pleasant Heartland Hospice Serving Greater Lansing and Jackson, Mason Heartland Hospice Serving Central Michigan, Mt. Pleasant Heartland Home Health Care Serving Greater Lansing and Jackson, Mason Heartland Hospice Serving The Thumb, Bad Axe Heartland Hospice Serving Central Eastern Michigan, Lapeer Heartland Hospice Serving West Michigan, Fremont Heartland Home Health Care Serving Central Eastern Michigan, Flint Heartland Health Care Center-Whitehall Heartland Hospice Serving Central Eastern Michigan, Flint Heartland Hospice Serving Northern Michigan, West Branch Heartland Health Care Center-Briarwood, Flint Heartland Home Health Care Serving Northern Michigan, West Branch Fostrian Court Assisted Living, Flushing Heartland Hospice Serving Northern Michigan, Cadillac Heartland Health Care Center-Fostrian, Flushing Heartland Hospice Serving Northwestern Michigan, Traverse City Heartland of Holland Heartland Home Health Care Serving Northwestern Michigan, Cadillac ManorCare Nursing & Rehabilitation Center, Kingsford Source: www.hcr-manorcare.com 51 SENIOR LIVING SECTOR: FOR-PROFIT

Brookdale Senior Living, Brentwood, TN (includes Emeritus Senior Living)

• 1,123 Communities in 47 States – All States except AK, DC, HI, SD

• 101,965 Total Units – 55+ Community – Independent Living – Assisted Living Source: www.brookdaleliving.com – Skilled Nursing –Memory Care

Source: Argentum 2016 Largest Senior Living Providers 52 SENIOR LIVING FP SECTOR: BROOKDALE SENIOR LIVING

Michigan Ohio Ohio (cont’d) Brookdale Place Of Ann Arbor Amber Park, Cincinnati Sterling House Of Fairfield Burcham Hills, East Lansing Brookdale Place At Finneytown, Cincinnati Sterling House Of Findlay Clare Bridge Of Ann Arbor Brookdale Place At Kenwood, Cincinnati Sterling House Of Greenville Clare Bridge Of Battle Creek Brookdale Place At Oakwood, Dayton Sterling House Of Lancaster Clare Bridge Of Bay City Brookdale Place Of Bath, Akron Sterling House Of Mansfield Clare Bridge Of Delta, Lansing Brookdale Place Of Englewood Sterling House Of Marion Clare Bridge Of Farmington Hills I & II Brookdale Place Of Englewood Sterling House Of Monroe Clare Bridge Of Grand Blanc, Holly Brookdale Place Of Wooster Sterling House of Newark Clare Bridge Of Meridian, Haslett Chambrel At Montrose, Akron Sterling House Of Piqua Clare Bridge Of Midland Clare Bridge Of Austintown Sterling House Of Richmond Clare Bridge Of Portage Clare Bridge Of Monroe Sterling House Of Salem Clare Bridge Of Saginaw Emerald Crossings, Dublin Sterling House Of Springdale, Freedom Village At Holland Indiana Grand Court Dayton Cincinnati Grand Court Adrian Berkshire Castleton, Indianapolis Grand Court Findlay Sterling House Of Springfield Grand Court Farmington Hills Brentwood At Elkhart Grand Court Springfield Sterling House Of Troy Grand Court Novi Brentwood At Hobart Homewood At Richmond Heights Sterling House Of Urbana Heritage Of Southfield Brentwood At LaPorte Homewood At Rockefeller Garden, Sterling House Of Washington Homewood Village Genesee Valley, Brookdale Merrillville Cleveland Heights Township, Dayton Flint Brookdale Place At Fall Creek, Indianapolis Sterling House Of Alliance Sterling House Of Westerville Park At Trowbridge, Southfield Brookdale Place At Willow Lake, Indianapolis Sterling House Of Barberton Sterling House Of Youngstown Sterling House Of Battle Creek Brookdale Portage Sterling House Of Beavercreek, Dayton The Fairways, Wickliffe Sterling House Of Bay City Brookdale Valparaiso Sterling House Of Bowling Green Trillium Place, Columbus Sterling House Of Davison Clare Bridge Of Carmel Sterling House Of Canton Waterford Dayton Sterling House Of Delta, Lansing Eastlake Terrace, Elkhart Sterling House Of Englewood. Clayton Westlake Village, Westlake Sterling House Of Midland Robin Run Village, Indianapolis Sterling House Of Englewood. Clayton Westlake Village Healthcare Center, Sterling House Of Saginaw Robin Run Village Healthcare Center, Indianapolis Westlake The Inn At Freedom Village Sterling House Of Bloomington Woodside Village Bedford Healthcare Center, Holland Sterling House of Kokomo Wynwood Of Grand Blanc, Holly Sterling House Of Marion Kentucky Wynwood Of Meridian Sterling House Of Richmond Horizon Bay, Louisville Wynwood of Haslett Sterling House Of South Bend Richmond Place, Lexington Wynwood Of Northville Richmond Place Rehab & Healthcare Wynwood Of Portage Center, Lexington Source: www.brookdaleliving.com SENIOR LIVING SECTOR: FOR-PROFIT

Trilogy Health Services, Louisville, KY

• 88 Communities in 4 States – IN, KY, MI, OH

• 3,671 Total Units – 55+ Community – Independent Living – Assisted Living – Skilled Nursing www.trilogyhs.com –Memory Care

Source: Argentum 2016 Largest Senior Living Providers 54 SENIOR LIVING FP SECTOR: TRILOGY HEALTH SERVICES Indiana Michigan Forest Park Health Campus, Richmond Indiana (cont’d) Ohio The Oaks at Woodfield, Grand Blanc Morrison Woods Health Campus, Muncie White Oak Health Campus, Monticello The Willows at Willard RidgeCrest Health Campus, Jackson Glen Oaks Health Campus, New Castle Creasy Springs Health Campus, Lafayette Forest Glen Health Campus, Shelby Crossing Health Campus, Senior Living at Forest Ridge, New Castle St. Mary Healthcare Center, Lafayette Springfield The Springs at Lafayette Shelby Township St. Andrews Health Campus, Batesville The Villas at Forest Glen, Hearthstone Health Campus, Bloomington Westlake Health Campus, Commerce Bethany Pointe Health Campus, Anderson Springfield Cumberland Pointe Health Campus, The Willows at Howell The Villas at Bethany Pointe, Anderson The Oaks at NorthPointe, West Lafayette The Willows at Okemos Aspen Place Health Campus, Greensburg Zanesville Wellbrooke of Crawfordsville The Oaks at Northpointe Woods, Wellbrooke of Wabash The Oaks at Bethesda, Autumn Woods Health Campus, New Albany Battle Creek The Villas at Springhurst, Greenfield Zanesville The Villas at Silvercrest, New Albany The Willows at East Lansing Springhurst Health Campus, Greenfield The Villas at Bellevue Mill Pond Health Campus, Greencastle Stonegate Health Campus, Lapeer The Villas at Ashford Place, Shelbyville Stonecroft Health Campus, Bloomington The Heritage, Findlay Ashford Place Health Campus, Shelbyville The Villages at Historic Silvercrest, New Albany The Willows at Bellevue Prairie Lakes Health Campus, Noblesville Owen Valley Health Campus, Spencer Richland Manor, Bluffton Lakeland Rehabilitation and Healthcare StoneBridge Health Campus, Bedford Valley View Healthcare Center, Milford Avalon Springs Health Campus, Valparaiso Center, Fremont Clearvista Lake Health Campus, Indianapolis Cedar Creek Health Campus, Lowell Briar Hill Health Campus, Blair Ridge Health Campus, Peru Spring Mill Health Campus, Merrillville North Baltimore The Villas at Blair Ridge, Peru Harrison's Crossing Health Campus, Springview Manor, Lima The Maples at Waterford Crossing, Goshen Terre Haute The Villas at Leipsic The Villas at Waterford Place, Kokomo Cobblestone Crossings Health Campus, The Meadows of Leipsic Waterford Place Health Campus, Kokomo Terre Haute Highland Oaks Health Center, St. Charles Health Campus, Jasper Wellbrooke of Kokomo McConnelsville The Villas at St. Charles, Jasper Arlington Place Health Campus, Indianapolis The Meadows of Kalida The Villages at Oak Ridge, Washington Wellbrooke of Westfield Genoa Retirement Village, Genoa The Villas at Oak Ridge, Washington Kentucky Wellbrooke of Carmel Cypress Pointe Health Campus, Scenic Hills Care Center, Ferdinand Cedar Ridge Health Campus, Cynthiana Thornton Terrace Health Campus, Hanover Englewood Oakwood Health Campus, Tell City The Willows at Citation, Lexington Greenleaf Health Campus, Ekkhart The Lakes of Monclova, Maumee The Villas at Oakwood, Tell City The Willows at Hamburg, Lexington WoodBridge Health Campus, Logansport The Meadows of Ottawa Amber Manor Care Center, Petersburg Forest Springs Health Campus, Louisville Wellbrooke of Avon Village Green Health Campus, BridgePointe Health Campus, Vincennes The Villas at Forest Springs, Louisville Covered Bridge Health Campus, Seymour Greenville Woodmont Health Campus\, Boonville Westport Place Health Campus, Louisville Homewood Health Campus, Lebanon Triple Creek Retirement RiverOaks Health Campus, Princeton Glen Ridge Health Campus, Louisville Hampton Oaks Health Campus, Scottsburg Silver Oaks Health Campus, Columbus Community, Cincinnati Franciscan Health Care Center, Louisville Wellbrooke of South Bend River Pointe Health Campus, Evansville The Villas at Triple Creek, Park Terrace Health Campus, Louisville St. Elizabeth Healthcare Center, Delphi West River Health Campus, Evansville Cincinnati 55 SENIOR LIVING FP SECTOR: MAINSTREET SENIOR LIVING • Mainstreet Senior Living, Carmel, IN – 28 Communities in 7 states • AR, IL, IN, KS, NY, PA, TX • 3,521 Total Units – 55+ Community – Independent Living – Assisted Living – Skilled Nursing –Memory Care • Future: 10 Communities in 4 States –1 in Colorado – 6 in Indiana – 2 in Kansas – 1 in Texas Sources: http://www.mainstreetinvestment.com/#welcome 56 SENIOR LIVING SECTOR: FOR-PROFIT

American House Senior Living Communities, Bloomfield Hills, MI

• 38 Communities in 3 States –FL, IL, MI

• 4,085 Total Units – 55+ Community – Independent Living – Assisted Living

– Skilled Nursing www.americanhouse.com –Memory Care

Source: Argentum 2016 Largest Senior Living Providers 57 SENIOR LIVING FP SECTOR: AMERICAN HOUSE

Michigan Michigan (cont’d) American House Brownstown, Brownstown Twp American House Milford Senior Living American House Carpenter Senior Living, Ypsilanti American House North Senior Living, Flint American House Charlevoix Senior Living, Charlevoix American House Oakland Senior Living, Pontiac American House Dearborn Heights Senior Living, Dearborn Heights American House Petoskey Senior Living American House East I Senior Living, Roseville American House Riverview Senior Living American House East II Senior Living, Roseville American House Southfield Senior Living American House Elmwood Senior Living, , Rochester Hills American House Southgate Senior Living American House Farmington Hills Senior Living, Farmington Hills American House Southland Senior Living, Taylor American House Grand Blanc Senior Living, Grand Blanc American House Spring Lake American House Grand Rapids Senior Living, Grand Rapids American House Sterling Heights Senior Living American House Grosse Pointe at Cottage, Grosse Pointe Farms American House Sterling Meadows Senior Living, Sterling Heights American House Hazel Park Senior Living, Hazel Park American House Sterling Woods Senior Living, Sterling Heights American House Holland American House Stone Senior Living, Rochester Hills American House Jenison American House The Village Senior Living, Rochester Hills American House Kentwood American House Troy Senior Living American House Lakeside Senior Living, Clinton Township American House West Bloomfield Senior Living American House Livonia Senior Living American House Westland Hunter Senior Living American House Lloyd’s Bayou, Spring Lake American House Westland Joy Senior Living American House Milford Senior Living American House Westland Venoy Senior Living Regent Street West Bloomfield

Illinois American House Cedarlake, Plainfield

Florida American House Bonita Springs Senior Living, Bonita Springs American House Coconut Point, Bonita Springs

Source: www.americanhouse.com 58 SENIOR LIVING SECTOR: FOR-PROFIT

Singh Senior Living, West Bloomfield, MI

• 9 Communities in 3 States – MI, NC, VA

• 1,768 Total Units – 55+ Community – Independent Living – Assisted Living

– Skilled Nursing www.singhweb.com –Memory Care

Source: Argentum 2016 Largest Senior Living Providers 59 SENIOR LIVING FP SECTOR: SINGH SENIOR LIVING

Michigan Michigan (cont’d) Adams Creek, Auburn Hills Waltonwood at Carriage Park, Canton Summit Creek, Canton Waltonwood at Cherry Hill, Canton Turnbury Park, Canton Waltonwood at Twelve Oaks, Novi Wyndchase, Canton Waltonwood at Main, Rochester Hills Briarcliff Village, Commerce Township Waltonwood at University, Rochester Hills MainCentre Apartments, Northville Waltonwood at Royal Oak Brownstones, Novi Waltonwood at Lakeside, Sterling Heights Mainstreet Village, Novi ShoreBrooke, Novi Wexford Townhomes, Novi CiderMill Village, Rochester Hills Northridge, Rochester Hills Brandywine, West Bloomfield Amberly, West Bloomfield

Virginia Waltonwood Ashburn

North Carolina Waltonwood Cary Parkway, Cary Waltonwood Cotswold, Charlotte Waltonwood Providence, Charlotte Waltonwood Lake Boone, Raleigh

Source: www.singhweb.com 60 TOPIC 4: SENIOR LIVING CAPITAL MARKETS NOT-FOR-PROFIT SENIOR LIVING FINANCINGS • Very few financings completed in the 12 months from July 2008 to July 2009 • 2010 & 2009 volume focused on relieving pent-up demand created during the crisis Estimated Other/Bank Credit $8,000

$7,000

$6,000 $1,500

$5,000 $1,660

$4,000 $2,543 $1,435 $1,974 $3,000 $1,066 (In Millions) $475

$2,000 $1,377

$1,000 $1,577 $1,490 $2,246 $2,506 $2,320 $2,293 $3,142 $3,524 $5,077 $4,982 $2,849 $2,860 $3,780 $3,160 $3,032 $4,138 $5,911 $7,394 $2,480 $1,801 $2,637 $1,148 $3,665 $2,795 $2,718 $3,802 $5,691 $0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Other Bank Credit Par Volume

SOURCE: Thomson Financial Securities Data, as of 12/31/16, Ziegler Investment Banking, Volume & Other Bank Credit Estimates thru 12/31/16 62 HISTORICAL INTEREST RATES Senior Living Non-Rated Yields (1990 YTD - Weekly)

30-Year NR MMD 30-Year Institutional "AAA" Minimum: 3.85% 1.95% Maximum: 10.75% 7.35% Yield % Average: 6.93% 4.81% 11.50 Current: 5.26% 3.01% 11.00 10.50 10.00 9.50 9.00 8.50 8.00 7.50 7.00 30-YR NR 6.50 Institutional 6.00 5.50 5.00 4.50 4.00 MMD 30-YR 3.50 "AAA" 3.00 2.50 2.00 1.50 NR = Non-Rated 1.00 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

SOURCE: Ziegler Investment Banking, as of 5/12/17 63 AAA MMD HISTORGRAM STILL A UNIQUE MARKET OPPORTUNITY

30-yr "AAA" MMD Histogram 1990 - 2017 (Frequency "Weekly")

35 4/21/17 MMD: 2.90%

20 Frequency 15

0 1.95 2.05 2.15 2.25 2.35 2.45 2.55 2.65 2.75 2.85 2.95 3.05 3.15 3.25 3.35 3.45 3.55 3.65 3.75 3.85 3.95 4.05 4.15 4.25 4.35 4.45 4.55 4.65 4.75 4.85 4.95 5.05 5.15 5.25 5.35 5.45 5.55 5.65 5.75 5.85 5.95 6.05 6.15 6.25 6.35 6.45 6.55 6.65 6.75 6.85 6.95 7.05

30-yr "AAA" MMD

Source: Thomson Financial Municipal Market Monitor, as of 4/21/17 64 BANK TRENDS (SENIOR LIVING) ANNUAL BANK CREDIT FEES 4.00% Letter of Credit Era Direct Purchase Era* 3.50%

3.00%

2.50%

2.00%

1.50%

1.00%

0.50%

0.00% 1996- 1998- 2000- 2002- 2004- 2006- 2008 2009 2010 2011 2012 2013 2014 2015 2016 1997 1999 2001 2003 2005 2007

A Category BBB Category Unrated New Campus - Temp Debt New Campus - Perm Debt

*Letter of Credit fees, if available, are 0.25%-0.50% higher SOURCE: Ziegler Investment Banking, as of 12/31/16 65 BANK TRENDS (SENIOR LIVING) BANK CREDIT COMMITMENT PERIODS

Letter of Credit Era Direct Purchase Era 14

8 Years 6

0 1996‐ 1998‐ 2000‐ 2002‐ 2004‐ 2006‐ 2008 2009 2010 2011 2012 2013 2014 2015 2016 1997 1999 2001 2003 2005 2007

Direct Purchase A Category ‐ LOC BBB Category ‐ LOC NR Category ‐ LOC

SOURCE: Ziegler Investment Banking, as of 12/31/16 66 20TH ANNUAL ZIEGLER SENIOR LIVING FINANCE + STRATEGY CONFERENCE

67 QUESTIONS & ANSWERS ABOUT US • Ziegler is a privately-held investment bank, capital markets, wealth management and alternative investments firm. • A registered broker dealer with SIPC & FINRA • Ziegler provides its clients with capital raising, strategic advisory services, equity & fixed-income trading, wealth management and research • Founded in 1902, Ziegler specializes in the healthcare, senior living, educational and religious sectors as well as general municipal finance

*Investment banking services offered through B.C. Ziegler and Company. FHA mortgage banking services are provided through Ziegler Financing Corporation which is not a registered broker/dealer. Ziegler Financing Corporation and B.C. Ziegler and Company are affiliated and referral fees may be paid by either entity for services provided.