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What changed in SONIDA SENIOR LIVING, INC.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of SONIDA SENIOR LIVING, INC.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+363 added−297 removedSource: 10-K (2026-03-12) vs 10-K (2025-03-17)

Top changes in SONIDA SENIOR LIVING, INC.'s 2025 10-K

363 paragraphs added · 297 removed · 204 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

49 edited+17 added−9 removed114 unchanged
Biggest changeJoseph, MO 103 22 64 17 103 100 % 05/13 Waterford at Baytown Baytown, TX 127 49 48 42 139 100 % 03/15 Waterford at Carpenter’s Creek Pensacola, FL 94 — 94 — 94 100 % 02/16 Waterford at Colby Colby, TX 44 — 40 17 57 100 % 01/16 Waterford at College Station College Station, TX 53 — 39 17 56 100 % 03/12 Waterford at Corpus Christi Corpus Christi, TX 52 — 52 — 52 100 % 10/12 Waterford at Creekside Pensacola, FL 84 — — 97 97 100 % 02/16 Waterford at Fairfield Fairfield, OH 120 144 — — 144 100 % 11/00 Waterford at Fitchburg Fitchburg, WI 82 38 45 — 83 100 % 10/13 Waterford at Fort Worth Fort Worth, TX 154 154 — — 154 100 % 06/00 Waterford at Hartford Hartford, WI 39 — 34 21 55 100 % 05/15 Waterford at Highland Colony Jackson, MS 120 120 — — 120 100 % 11/00 Waterford at Ironbridge Springfield, MO 120 120 — — 120 100 % 06/01 Waterford at Levis Commons Toledo, OH 146 71 93 12 176 100 % 04/09 Waterford at Mansfield Mansfield, OH 120 — 117 26 143 100 % 10/00 Waterford at Mesquite Mesquite, TX 154 154 — — 154 100 % 09/99 Waterford at Park Falls Park Falls, WI 36 — 25 12 37 100 % 01/16 Waterford at Plano Plano, TX 136 91 45 — 136 100 % 12/00 Waterford at Plymouth Plymouth, WI 69 20 29 20 69 100 % 08/14 Waterford at Thousand Oaks San Antonio, TX 121 138 — — 138 100 % 05/00 Waterford at Virginia Beach Virginia Beach, VA 110 — 85 35 120 100 % 10/15 Waterford at West Bend West Bend, WI 40 — 20 20 40 100 % 05/15 Waterford at Wisconsin Rapids Wisconsin Rapids, WI 58 — 40 18 58 100 % 01/16 Waterford on Cooper Arlington, TX 98 — 81 28 109 100 % 03/12 Waterford on Huebner San Antonio, TX 120 121 — — 121 100 % 04/99 Wellington at Arapaho Richardson, TX 142 99 45 — 144 100 % 05/02 Wellington at Conroe Conroe, TX 44 36 20 — 56 100 % 03/12 Wellington at Dayton Dayton, OH 156 101 37 18 156 100 % 08/08 Wellington at North Bend Crossing- Hilltop Cincinnati, OH 122 54 70 15 139 100 % 11/16 Wellington at North Bend Crossing- Vista (2) Cincinnati, OH 82 — 50 32 82 100 % 12/24 Wellington at North Richland Hills North Richland Hills, TX 120 120 — — 120 100 % 01/02 Wellington at Southport Indianapolis, IN 64 — 51 14 65 100 % 10/12 7 Table of Contents Resident Capacity Commencement Community Location Units IL AL MC Total Ownership of Operations 1 Wellington at Springfield Springfield, MA 189 97 144 38 279 100 % 09/16 Whispering Pines Village (3) Columbiana, OH 69 24 57 — 81 100 % 07/15 Woodlands of Columbus Columbus, OH 111 — 80 34 114 100 % 10/12 Woodlands of Hamilton Hamilton, OH 77 — 57 28 85 100 % 10/12 Wynnfield Crossing Rochester, IN 51 — 51 — 51 100 % 07/11 Ashton at Mayfield Heights Mayfield Heights, OH 192 99 61 32 192 33 % 05/24 Ashton at Anderson Cincinnati, OH 94 — 60 34 94 33 % 05/24 Ashton on Dorsey Louisville, KY 95 — 53 43 96 33 % 05/24 Ashton on the Plaza Kansas City, MO 89 — 64 28 92 33 % 05/24 Waterford at Shavano Park San Antonio, TX 79 — 62 17 79 51 % 07/24 Waterford at Westover Hills San Antonio, TX 84 — 58 48 106 51 % 07/24 Waterford at Round Rock Round Rock, TX 100 — 70 34 104 51 % 07/24 Waterford at Decatur Decatur, GA 62 — — 70 70 51 % 07/24 Total owned (81 Communities) 7,526 2,617 4,162 1,700 8,479 Managed: Amberleigh Buffalo, NY 267 201 49 17 267 N/A 01/92 Crown Pointe Omaha, NE 138 41 78 22 141 N/A 08/00 Independence Village of East Lansing East Lansing, MI 146 146 — — 146 N/A 08/00 Independence Village of Olde Raleigh Raleigh, NC 170 181 — — 181 N/A 08/00 Lodge at White Bear White Bear Lake, MN 117 120 — — 120 N/A 06/24 Middleton Crossing Middleton, WI 117 117 — — 117 N/A 08/24 Oakwood Hills Eau Claire, WI 116 119 — — 119 N/A 06/24 Southern Meadows Senior Living Mountain Home, AR 57 — 57 — 57 N/A 12/21 Villa Santa Barbara Santa Barbara, CA 125 — 125 — 125 N/A 08/00 West Shores Hot Springs, AR 135 56 80 — 136 N/A 08/00 Whitley Place Keller, TX 47 — 27 20 47 N/A 02/08 Willow Grove Maumelle Maumelle, AR 54 — 37 17 54 N/A 12/21 Willow Grove Sherwood Sherwood, AR 57 — 57 — 57 N/A 12/21 Total managed (13 Communities) 1,546 981 510 76 1,567 Total 9,072 3,598 4,672 1,776 10,046 _____________________________________________ (1) Indicates the date on which we acquired or commenced operating the community.
Biggest changeJoseph, MO 103 22 64 17 103 100 % 05/13 Waterford at Baytown Baytown, TX 127 40 57 40 137 100 % 03/15 Waterford at Carpenter’s Creek Pensacola, FL 94 — 94 — 94 100 % 02/16 Waterford at Colby Colby, TX 44 — 40 17 57 100 % 01/16 Waterford at College Station College Station, TX 53 — 39 17 56 100 % 03/12 Waterford at Corpus Christi Corpus Christi, TX 52 — 52 — 52 100 % 10/12 Waterford at Creekside Pensacola, FL 84 — 14 83 97 100 % 02/16 Waterford at Fairfield Fairfield, OH 120 144 — — 144 100 % 11/00 Waterford at Fitchburg Fitchburg, WI 82 33 52 — 85 100 % 10/13 Waterford at Fort Worth Fort Worth, TX 154 154 — — 154 100 % 06/00 Waterford at Hartford Hartford, WI 39 2 30 21 53 100 % 05/15 Waterford at Highland Colony Jackson, MS 120 120 — — 120 100 % 11/00 Waterford at Ironbridge Springfield, MO 120 120 — — 120 100 % 06/01 Waterford at Levis Commons Toledo, OH 153 — 161 21 182 100 % 04/09 Waterford at Mansfield Mansfield, OH 120 — 117 26 143 100 % 10/00 Waterford at Mesquite Mesquite, TX 154 154 — — 154 100 % 09/99 Waterford at Park Falls Park Falls, WI 36 — 25 12 37 100 % 01/16 Waterford at Plano Plano, TX 137 92 45 — 137 100 % 12/00 Waterford at Plymouth Plymouth, WI 69 20 29 20 69 100 % 08/14 Waterford at Thousand Oaks San Antonio, TX 121 138 — — 138 100 % 05/00 Waterford at Virginia Beach Virginia Beach, VA 110 — 85 35 120 100 % 10/15 Waterford at West Bend West Bend, WI 40 — 20 20 40 100 % 05/15 Waterford at Wisconsin Rapids Wisconsin Rapids, WI 58 — 40 18 58 100 % 01/16 Waterford on Cooper Arlington, TX 98 — 81 28 109 100 % 03/12 Waterford on Huebner San Antonio, TX 120 120 — — 120 100 % 04/99 Wellington at Arapaho Richardson, TX 142 100 45 — 145 100 % 05/02 Wellington at Conroe Conroe, TX 44 36 20 — 56 100 % 03/12 Wellington at Dayton Dayton, OH 156 101 37 18 156 100 % 08/08 Wellington at North Bend Crossing- Hilltop Cincinnati, OH 122 54 71 15 140 100 % 11/16 Wellington at North Bend Crossing- Vista Cincinnati, OH 82 — 81 32 113 100 % 12/24 Wellington at North Richland Hills North Richland Hills, TX 120 120 — — 120 100 % 01/02 Wellington at Southport Indianapolis, IN 64 — 51 14 65 100 % 10/12 8 Table of Contents Resident Capacity Commencement Community Location Units IL AL MC Total Ownership of Operations 1 Wellington at Springfield Springfield, MA 189 97 134 30 261 100 % 09/16 Whispering Pines Village (2) Columbiana, OH 69 24 57 — 81 100 % 07/15 Woodlands of Columbus Columbus, OH 111 — 79 35 114 100 % 10/12 Woodlands of Hamilton Hamilton, OH 77 — 57 28 85 100 % 10/12 Wynnfield Crossing Rochester, IN 51 — 51 — 51 100 % 07/11 Ashton at Mayfield Heights Mayfield Heights, OH 192 77 83 32 192 33 % 05/24 Ashton at Anderson Cincinnati, OH 94 — 60 34 94 33 % 05/24 Ashton on Dorsey Louisville, KY 95 — 53 43 96 33 % 05/24 Ashton on the Plaza Kansas City, MO 89 — 64 28 92 33 % 05/24 Waterford at Shavano Park San Antonio, TX 79 — 62 17 79 51 % 07/24 Waterford at Westover Hills San Antonio, TX 84 — 58 48 106 51 % 07/24 Waterford at Round Rock Round Rock, TX 100 — 70 34 104 51 % 07/24 Waterford at Decatur Decatur, GA 62 — — 70 70 51 % 07/24 Total owned (84 Communities) 7,783 2,492 4,464 1,808 8,764 Managed: Amberleigh Buffalo, NY 267 201 49 17 267 N/A 01/92 Crown Pointe Omaha, NE 138 41 78 22 141 N/A 08/00 Independence Village of East Lansing East Lansing, MI 146 146 — — 146 N/A 08/00 Lodge at White Bear White Bear Lake, MN 117 120 — — 120 N/A 06/24 Middleton Crossing Middleton, WI 117 117 — — 117 N/A 08/24 Oakwood Hills Eau Claire, WI 116 119 — — 119 N/A 06/24 Southern Meadows Senior Living Mountain Home, AR 57 — 57 — 57 N/A 12/21 Villa Santa Barbara Santa Barbara, CA 125 — 125 — 125 N/A 08/00 West Shores Hot Springs, AR 135 56 80 — 136 N/A 08/00 Whitley Place Keller, TX 47 — 27 20 47 N/A 02/08 Willow Grove Maumelle Maumelle, AR 54 — 37 17 54 N/A 12/21 Willow Grove Sherwood Sherwood, AR 57 — 57 — 57 N/A 12/21 Total managed (12 Communities) 1,376 800 510 76 1,386 Total 9,159 3,292 4,974 1,884 10,150 _____________________________________________ (1) Indicates the date on which we acquired the community (with respect to owned communities) or commenced operating the community (with respect to managed communities).
In addition, health care providers are experiencing heightened scrutiny under anti-trust laws in the United States as integration and consolidation of health care delivery increases and affects competition. Moreover, robust state and federal enforcement of fraud and abuse laws continues. Some of our communities receive a portion of their funds from Medicaid.
In addition, health care providers are experiencing heightened scrutiny under anti-trust laws in the United States as the integration and consolidation of health care delivery increases and affects competition. Moreover, robust state and federal enforcement of fraud and abuse laws continues. Some of our communities receive a portion of their funds from Medicaid.
Offer Services Across a Range of Pricing Options Our range of products and services is continually expanding to meet the evolving needs of our residents. We have developed a menu of products and service programs that may be further customized to serve the middle-income market of a particular targeted geographic area.
Offer Services Across a Range of Pricing Options Our range of products and services is continually expanding to meet the evolving needs of our residents. We have developed a menu of products and service programs that may be further customized to serve the middle and upper middle-income market of a particular targeted geographic area.
The identification of best practices is realized by a number of means, including: (i) emphasis on territory and executive directors keeping up with professional trade publications; (ii) interaction with other professionals and consultants in the senior living industry through seminars, conferences, and consultations; (iii) visits to other properties; (iv) leadership and participation at national and local trade organization events; and (v) information derived from marketing studies and resident satisfaction surveys.
The identification of best practices is realized by a number of means, including: (i) emphasis on territory and executive directors keeping up with professional trade publications; (ii) interaction with other professionals and consultants in the senior living industry through seminars, conferences, and consultations; (iii) visits to other communities; (iv) leadership and participation at national and local trade organization events; and (v) information derived from marketing studies and resident satisfaction surveys.
In addition, we may make certain customized physician, dentistry, podiatry and other health-related rehabilitation and therapy services available to our residents through third-party providers. Operating Communities The table below sets forth certain information with respect to the senior housing communities we operated as of December 31, 2024.
In addition, we may make certain customized physician, dentistry, podiatry and other health-related rehabilitation and therapy services available to our residents through third-party providers. Operating Communities The table below sets forth certain information with respect to the senior housing communities we operated as of December 31, 2025.
In addition, third-party payors are increasingly becoming involved in determining the appropriate health care settings for their insureds or clients, based primarily on cost and quality of care. Senior Living Services We provide senior living services primarily to residents aged 75 and greater, including independent living, assisted living, and memory care services.
In addition, third-party payors are increasingly becoming involved in determining the appropriate health care settings for their insureds or clients, based primarily on cost and quality of care. Senior Living Services We provide senior living services primarily to residents aged 75 and older, including independent living, assisted living, and memory care services.
Governmental Regulation Changes in existing laws and regulations, adoption of new laws and regulations, and new interpretations of existing laws and regulations could have a material effect on our operations. Failure by us to comply with any applicable regulatory requirement could have a material adverse effect on our business, financial condition, cash flows, and results of operations.
Governmental Regulation Changes in existing laws and regulations, adoption of new laws and regulations, and new interpretations of existing laws and regulations could have a material effect on our operations. Failure by us to comply with any applicable statutory or regulatory requirement could have a material adverse effect on our business, financial condition, cash flows, and results of operations.
Community expenditures are monitored by territory directors and vice presidents who are accountable for the resident satisfaction and financial performance of the communities in their territory. Territory Management We provide oversight and support to each of our senior housing communities through experienced regional directors and vice presidents.
Community expenditures are monitored by territory directors and divisional presidents who are accountable for the resident satisfaction and financial performance of the communities in their territory. Territory Management We provide oversight and support to each of our senior housing communities through experienced regional directors and divisional presidents.
Independent Living Services We provide independent living services to seniors who typically do not yet need assistance or support with ADLs, but who prefer the physical and psychological comfort of a residential community that offers health care and other services. 4 Table of Contents Independent living services provided by us include daily meals, transportation, social and recreational activities, laundry, housekeeping and 24-hour community staffing.
Independent Living Services We provide independent living services to seniors who typically do not yet need assistance or support with ADLs, but who prefer the physical and psychological comfort of a residential community that offers health care and other services. Independent living services provided by us include daily meals, transportation, social and recreational activities, laundry, housekeeping and 24-hour community staffing.
Under various U.S. federal, state, and local environmental laws, ordinances and regulations, a current or previous owner or operator of real estate may be required to investigate and clean up hazardous or toxic substances or petroleum product releases at or migrating from such property and may be held liable to a governmental entity or to third parties for property 12 Table of Contents damage and for investigation and clean-up costs.
Under various U.S. federal, state, and local environmental laws, ordinances and regulations, a current or previous owner or operator of real estate may be required to investigate and clean up hazardous or toxic substances or petroleum product releases at or migrating from such property and may be held liable to a governmental entity or to third parties for property damage and for investigation and clean-up costs.
Our target population is comprised of high income seniors who have, either directly or indirectly through familial support, the financial resources to afford and pay for senior housing communities, including an assisted living alternative to traditional long-term care. Reduced Reliance on Family Care Historically, the family has been the primary provider of care for seniors.
Our target population is comprised of high-income seniors who have, either directly or indirectly through familial support, the financial resources to afford and pay for senior housing communities, including an assisted living alternative to traditional long-term care. 4 Table of Contents Reduced Reliance on Family Care Historically, the family has been the primary provider of care for seniors.
Our marketing activities focus on increasing the volume of leading indicators, including new resident inquiries and tours, so that potential residents and their families can effectively evaluate our portfolio of services. We have improved our financial flexibility by modifying the terms on a significant portion of our debt and repurchasing some of our debt at discounts to par.
Our marketing activities focus on increasing the volume of leading indicators, including new resident inquiries and tours, so that potential residents and their families can effectively evaluate our portfolio of services. 3 Table of Contents We have improved our financial flexibility by modifying the terms on a significant portion of our debt and repurchasing some of our debt at discounts to par.
By creating an environment that maximizes resident autonomy and provides individualized service programs, we seek to attract seniors at an earlier stage before they need the higher level of care provided in a skilled nursing facility. Portfolio Optimization We continue to focus on the occupancy, rents, and operating margins of our communities.
By creating an environment that maximizes resident autonomy and provides individualized service programs, we seek to attract seniors at an earlier stage before they need the higher level of care provided in a skilled nursing facility. 9 Table of Contents Portfolio Optimization We continue to focus on the occupancy, rents, and operating margins of our communities.
A number of additional federal, state and local laws exist that also may require modifications to existing and planned properties to permit access to the properties by disabled persons.
A number of additional federal, state and local laws exist that also may require modifications to existing and planned communities to permit access to the communities by disabled persons.
We continue to be positioned to provide competitive residential rates and flexible product offerings. Our portfolio is situated in markets where positive demographic trends exist with respect to population growth, income growth, and population density of the 75+ age 2 Table of Contents group.
We continue to be positioned to provide competitive residential rates and flexible product offerings. Our portfolio is situated in markets where positive demographic trends exist with respect to population growth, income growth, and population density of the 75+ age group.
Failure by us to comply with any 11 Table of Contents applicable regulatory requirements could have a material adverse effect on our business, financial condition and results of operations. Regulation of the assisted living industry is also continually evolving, and we are unable to predict the scope, content or stringency of new regulations and their ultimate effect on our business.
Failure by us to comply with any applicable statutory or regulatory requirements could have a material adverse effect on our business, financial condition and results of operations. Regulation of the assisted living industry is also continually evolving, and we are unable to predict the scope, content or stringency of new regulations and their ultimate effect on our business.
We have not been notified by any governmental authority, and are not otherwise aware of any material non-compliance, liability or claim relating to hazardous or toxic substances or petroleum products in connection with any of the communities we currently operate.
We have not been notified by any governmental authority, and are not otherwise aware of any material 13 Table of Contents non-compliance, liability or claim relating to hazardous or toxic substances or petroleum products in connection with any of the communities we currently operate.
However, any future substantial failure to comply with any applicable legal and regulatory requirements could result in a material adverse effect on our business, financial condition, and results of operations as a whole. In addition, states’ Attorneys General vigorously enforce consumer protection laws as those laws relate to the senior living industry.
However, any future substantial failure to comply with any applicable legal and regulatory requirements could result in a material adverse effect on our business, financial condition, and results of operations as a whole. In addition, states’ Attorney Generals vigorously enforce consumer protection laws as those laws relate to the senior living industry.
Our residences and services are designed to provide a broad range of care that permits residents to thrive and “age in place” as their needs change and as they develop further physical or cognitive 8 Table of Contents frailties.
Our residences and services are designed to provide a broad range of care that permits residents to thrive and “age in place” as their needs change and as they develop further physical or cognitive frailties.
Another hallmark of the program is an emphasis on family connections, including ongoing educational opportunities specifically designed to help family members understand dementia and aspects of 5 Table of Contents the disease and its progression.
Another hallmark of the program is an emphasis on family connections, including ongoing educational opportunities specifically designed to help family members understand dementia and aspects of the disease and its progression.
At the same time, nursing facility operators are continuing to focus on improving occupancy and expanding services to sub-acute patients generally of a younger age and requiring significantly higher levels of nursing care.
At the same time, nursing facility operators are continuing to focus on improving occupancy and expanding services to sub-acute patients generally of an older age and requiring significantly higher levels of nursing care.
Resident Capacity Commencement Community Location Units IL AL MC Total Ownership of Operations 1 Owned: Addison of Bluffton Bluffton, SC 73 — 45 40 85 100 % 10/24 Addison of Florence Florence, SC 72 — 52 23 75 100 % 10/24 Addison of Gwinnett Park Lawrenceville, GA 94 — 48 58 106 100 % 11/24 Addison of Narcoossee St.
Resident Capacity Commencement Community Location Units IL AL MC Total Ownership of Operations 1 Owned: Addison of Alpharetta Alpharetta, GA 88 — 65 24 89 100 % 06/25 Addison of Bluffton Bluffton, SC 73 — 45 40 85 100 % 10/24 Addison of Florence Florence, SC 72 — 52 23 75 100 % 10/24 Addison of Gwinnett Park Lawrenceville, GA 94 — 48 58 106 100 % 11/24 Addison of Narcoossee St.
Augustine, FL 61 — 40 32 72 100 % 10/24 Addison of West Ashley Charleston, SC 73 — 45 42 87 100 % 10/24 Aspen Grove Lambertville, MI 79 — 44 41 85 100 % 03/14 Autumn Glen Greencastle, IN 50 — 58 — 58 100 % 06/13 Brookview Meadows Green Bay, WI 79 43 37 — 80 100 % 01/15 Chateau of Batesville Batesville, IN 41 — 43 — 43 100 % 10/12 Cottonwood Village Cottonwood, AZ 160 72 67 21 160 100 % 03/91 Country Charm Greenwood, IN 89 — 166 — 166 100 % 10/12 Courtyards at Lake Granbury Granbury, TX 82 — 73 18 91 100 % 03/12 Georgetowne Place Fort Wayne, IN 172 15 144 14 173 100 % 10/05 Good Tree Retirement and Memories Stephenville, TX 59 40 31 8 79 100 % 03/12 Greenbriar Village Indianapolis, IN 105 — 82 43 125 100 % 08/15 Harrison at Eagle Valley Indianapolis, IN 119 — 105 14 119 100 % 03/91 6 Table of Contents Resident Capacity Commencement Community Location Units IL AL MC Total Ownership of Operations 1 Heritage at the Plains Oneonta, NY 108 94 28 16 138 100 % 05/15 Keystone Woods Assisted Living Anderson, IN 59 — 61 — 61 100 % 07/11 Laurel Hurst Laurel Woods Columbus, NC 80 70 48 32 150 100 % 10/11 Marquis Place of Elkhorn Elkhorn, NE 63 — 43 23 66 100 % 03/13 North Pointe Anderson, SC 41 — 58 24 82 100 % 10/11 Oaks at Brownsburg Brownsburg, IN 97 98 — — 98 100 % 02/22 Oaks at Plainfield Plainfield, IN 60 61 — — 61 100 % 02/22 Riverbend Jeffersonville, IN 97 — 65 48 113 100 % 03/12 Remington at Valley Ranch Irving, TX 128 128 — — 128 100 % 04/12 Residence of Chardon Chardon, OH 42 — 42 — 42 100 % 10/12 Rose Arbor Maple Grove, MN 138 28 75 42 145 100 % 06/06 Rosemont Humble, TX 96 — 79 48 127 100 % 09/16 Summit Corners Macedonia, OH 100 — 140 60 200 100 % 05/24 Summit Place Anderson, SC 76 17 72 48 137 100 % 10/11 Summit Point Living Macedonia, OH 151 79 72 — 151 100 % 08/11 Vintage Gardens St.
Augustine, FL 61 — 41 32 73 100 % 10/24 Addison of West Ashley Charleston, SC 73 — 45 41 86 100 % 10/24 Aspen Grove Lambertville, MI 79 — 44 41 85 100 % 03/14 Autumn Glen Greencastle, IN 50 — 58 — 58 100 % 06/13 Brookview Meadows Green Bay, WI 79 45 37 — 82 100 % 01/15 Chateau of Batesville Batesville, IN 41 — 43 — 43 100 % 10/12 Cottonwood Village Cottonwood, AZ 160 74 69 21 164 100 % 03/91 Country Charm Greenwood, IN 89 — 166 — 166 100 % 10/12 Courtyards at Lake Granbury Granbury, TX 82 — 73 18 91 100 % 03/12 Georgetowne Place Fort Wayne, IN 172 15 144 14 173 100 % 10/05 Good Tree Retirement and Memories Stephenville, TX 59 40 31 8 79 100 % 03/12 Greenbriar Village Indianapolis, IN 105 — 82 43 125 100 % 08/15 Harrison at Eagle Valley Indianapolis, IN 119 — 105 14 119 100 % 03/91 Heritage at the Plains Oneonta, NY 108 94 28 16 138 100 % 05/15 Jasper of Mansfield Mansfield, TX 98 — 73 36 109 100 % 09/25 7 Table of Contents Resident Capacity Commencement Community Location Units IL AL MC Total Ownership of Operations 1 Keystone Woods Assisted Living Anderson, IN 58 — 61 — 61 100 % 07/11 Laurel Hurst Laurel Woods Columbus, NC 80 70 48 32 150 100 % 10/11 Magnolia Trails at East Lakes Tarpon Springs, FL 64 — — 65 65 100 % 05/25 Marquis Place of Elkhorn Elkhorn, NE 63 — 43 23 66 100 % 03/13 North Pointe Anderson, SC 41 — 58 24 82 100 % 10/11 Oaks at Brownsburg Brownsburg, IN 97 98 — — 98 100 % 02/22 Oaks at Plainfield Plainfield, IN 60 61 — — 61 100 % 02/22 Riverbend Jeffersonville, IN 97 — 65 47 112 100 % 03/12 Remington at Valley Ranch Irving, TX 128 128 — — 128 100 % 04/12 Residence of Chardon Chardon, OH 42 — 42 — 42 100 % 10/12 Rose Arbor Maple Grove, MN 138 3 98 42 143 100 % 06/06 Rosemont Humble, TX 96 — 79 48 127 100 % 09/16 Summit Corners Macedonia, OH 100 — 140 60 200 100 % 05/24 Summit Place Anderson, SC 76 17 72 48 137 100 % 10/11 Summit Point Living Macedonia, OH 151 79 72 — 151 100 % 08/11 Vintage Gardens St.
Management Services As of December 31, 2024, we managed 13 communities on behalf of a third party and also managed certain joint venture investments.
Management Services As of December 31, 2025, we managed 12 communities on behalf of a third party and also managed certain joint venture investments.
Cloud, FL 72 — 52 23 75 100 % 10/24 Addison of Oakleaf Jacksonville, FL 73 — 45 42 87 100 % 10/24 Addison of Oviedo Oviedo, FL 72 — 53 23 76 100 % 10/24 Addison of Port Orange Port Orange, FL 59 — 45 24 69 100 % 10/24 Addison of Sandy Springs Peachtree Corners, GA 84 — 63 26 89 100 % 11/24 Addison of St.
Cloud, FL 72 — 52 23 75 100 % 10/24 Addison of Oakleaf Jacksonville, FL 73 — 45 41 86 100 % 10/24 Addison of Oviedo Oviedo, FL 72 — 54 23 77 100 % 10/24 Addison of Port Orange Port Orange, FL 59 — 45 24 69 100 % 10/24 Addison of Sandy Springs Peachtree Corners, GA 84 — 63 26 89 100 % 11/24 Addison of St.
They work individually and collectively each day to provide safety, wellness, care and service to our residents. As of December 31, 2024, we employed 5,063 persons, of which 3,415 were full-time employees and 1,648 were part-time employees. Additionally, we had 21 unfilled community leadership positions as of December 31, 2024.
They work individually and collectively each day to provide safety, wellness, care and service to our residents. As of December 31, 2025, we employed 5,140 persons, of which 3,423 were full-time employees and 1,717 were part-time employees. Additionally, we had 16 unfilled community leadership positions as of December 31, 2025.
As of December 31, 2024, the Company owned, managed, or invested in 94 senior housing communities in 20 states with an aggregate capacity of approximately 10,000 residents, including 81 owned senior housing communities (including four owned through joint venture investments in consolidated entities, four owned through a joint venture investment in an unconsolidated entity, and one unoccupied) and 13 communities that the Company managed on behalf of a third-party.
As of December 31, 2025, the Company owned, managed, or invested in 96 senior housing communities in 20 states with an aggregate capacity of approximately 10,150 residents, including 84 owned senior housing communities (inclusive of four owned through joint venture investments in consolidated entities and four owned through a joint venture investment in an unconsolidated entity) and 12 communities that the Company managed on behalf of a third-party.
Operations Overview We believe that the fragmented nature of the senior living industry, the lack of new supply entering the market, and the limited capital resources available to many small, private operators provides us with an attractive opportunity for competitive differentiation.
(2) This excludes 12 managed units that are owned by a third party. Operations Overview We believe that the fragmented nature of the senior living industry, the lack of new supply entering the market, and the limited capital resources available to many small, private operators provides us with an attractive opportunity for competitive differentiation.
We have established a Corporate Quality Assurance Committee, which consists of the President and Chief Executive Officer, Vice Presidents of Operations, Vice President and Chief People Officer, Senior Vice President and Chief Clinical Officer, Quality and Clinical Directors, and Senior Vice President – Chief Legal Officer.
We have established a Corporate Quality Assurance Committee, which consists of the President and Chief Executive Officer, Division Presidents, Vice President of Operations, Chief Clinical Officer, Vice President of Clinical Operations, Clinical Trainer, Chief Legal Officer, Associate Counsel, and Senior Director of Operational Excellence.
A regional director will generally cover a geographic area consisting of three to 12 communities, while a vice president generally oversees approximately 24 to 40 communities. 9 Table of Contents The executive director at each community reports to a regional director, who in turn reports to a vice president who reports to our Chief Executive Officer.
A regional director will generally cover a geographic area consisting of 4 to 11 communities, while a divisional president generally oversees approximately 48 communities. The executive director at each community reports to a regional director, who in turn reports to a divisional president who reports to our Chief Executive Officer.
We have also implemented a comprehensive online training program that addresses the specific challenges of working within the senior living environment. Our commitment to the total quality management concept is emphasized throughout our training programs.
In addition to normal on-site training, we conduct national management meetings and encourage sharing of expertise among managers. We have also implemented a comprehensive online training program that addresses the specific challenges of working within the senior living environment. Our commitment to the total quality management concept is emphasized throughout our training programs.
Each territory designates senior Executive Directors, Wellness Directors, Sales leadership, and Senior Culinary Directors to visit communities across their territory on an ongoing basis. These individuals partner with our Regional Clinical Managers, Regional Operations, and Sales leadership to provide ongoing training and development, complete Quality Assurance reviews on-site, and review the implementation of clinical or resident service programming.
These individuals partner with our Regional Clinical Managers, Regional Operations, and Sales leadership to provide ongoing training and development, complete quality assurance reviews on-site, and review the implementation of clinical or resident service programming.
Our total rewards design includes many other benefits that can be included at the choice of each employee based on his or her needs, which is our overall strategy to providing engaging and flexible rewards for our people.
We also offer a 401(k) plan that all eligible employees can participate in as they plan for their futures. Our total rewards design includes many other benefits that can be included at the choice of each employee based on his or her needs, which is our overall strategy to providing engaging and flexible rewards for our people.
While we believe that our communities are in substantial compliance with applicable regulatory requirements, unannounced surveys or inspections may occur annually or following a regulator’s receipt of a complaint about a community, any of which could result in a citation of deficiency.
There can be no assurance that our operations will not be materially and adversely affected by regulatory developments in the future. 12 Table of Contents While we believe that our communities are in substantial compliance with applicable regulatory requirements, unannounced surveys or inspections may occur annually or following a regulator’s receipt of a complaint about a community, any of which could result in a citation of deficiency.
We will continue to strive each day to maintain our inclusive culture through our efforts in recruiting, education, development, and talent progression. 13 Table of Contents Talent Acquisition, Development and Retention In our efforts to attract new members to our team, we believe that a local focus, supported by our central talent team, provides the best results.
Talent Acquisition, Development and Retention In our efforts to attract new members to our team, we believe that a local focus, supported by our central talent team, provides the best results. We continue to enhance our recruiting landscape to ensure we are connecting with the best and 14 Table of Contents brightest individuals.
We believe that a substantial portion of the senior population has historically accumulated significant resources available for their retirement and long-term care needs.
Senior Affluence The average net worth of senior citizens is typically higher than non-senior citizens, partially as a result of accumulated equity through home ownership. We believe that a substantial portion of the senior population has historically accumulated significant resources available for their retirement and long-term care needs.
Assisted Living Services We offer a wide range of assisted living care and services, including personal care services, 24-hour staffing, support services, and other supplemental services, including memory care services at some communities (as described below).
Subject to applicable governmental regulations, personal care and medical services are available to independent living residents through either the community staff or through independent home care agencies. 5 Table of Contents Assisted Living Services We offer a wide range of assisted living care and services, including personal care services, 24-hour staffing, support services, and other supplemental services, including memory care services at some communities (as described below).
For example, our health plans allow participants to enter the plan at an affordable premium and participants automatically receive unlimited free telehealth and local retail clinic visits, along with all other benefits of the plans. This benefit provides our people quick and easy access to care at no cost to them when they need to access it.
We also offer benefits that are designed to fit a wide variety of needs. For example, our health plans allow participants to enter the plan at an affordable premium and participants automatically receive unlimited free telehealth and local retail clinic visits, along with all other benefits of the plans.
In 10 Table of Contents addition to numeric ratings and industry comparisons, there are also several opportunities for general feedback to ensure residents and families could provide input on any topic. Regular Community Inspections.
In addition to numeric ratings and industry comparisons, there are also several opportunities for general feedback to ensure residents and families could provide input on any topic. Regular Community Inspections. Each community is inspected in person, on at least a quarterly basis, by a member of the regional and/or operational leadership team, which is also supplemented by virtual site visits.
Demographics Our portfolio is strategically positioned in (i) attractive, high income demographic geographies and (ii) regions where the number of new senior living units needed will continue to grow as a result of the projected increase in the number of chronic conditions in the senior population. 3 Table of Contents Senior Affluence The average net worth of senior citizens is typically higher than non-senior citizens, partially as a result of accumulated equity through home ownership.
Demographics Our portfolio is strategically positioned in (i) markets with attractive, high-income demographics and (ii) regions where the number of new senior living units needed will continue to grow as a result of the projected population growth in the 75 and older population.
All communities with the Magnolia Trails program use a resident engagement mobile application where family members can receive real-time photos, videos and updates about their loved ones electronically.
All communities with the Magnolia Trails program use a resident engagement mobile application where family members can receive real-time photos, videos and updates about their loved ones electronically. 6 Table of Contents Respite Care and Temporary Care Programs Our respite care and temporary care program provides a transitional apartment for seniors who are not entirely ready to return home after a hospital or rehabilitation stay.
We are proud to be an equal opportunity employer. Our diversity is exhibited by the composition of our workforce with 83% female and 54% with a diverse background.
We are proud to be an equal opportunity employer. Our diversity is exhibited by the composition of our workforce with 82% female and 55% with a diverse background as of December 31,2025. We will continue to strive each day to maintain our inclusive culture through our efforts in recruiting, education, development, and talent progression.
We are proud of our development programs that sponsor our current employees in achieving new levels of education, licensure, and credentials. Through this approach, we support our employees’ growth while they continue to work with us in new roles, enhancing our service and care and providing these employees with additional earning potential.
Through this approach, we support our employees’ growth while they continue to work with us in new roles, enhancing our service and care and providing these employees with additional earning potential. Total Rewards We provide fair, competitive, and aligned compensation to all of our people that is reviewed at least annually for both merit and market-based adjustments.
Periodically, we engage the services of outside professional independent consulting firms to evaluate various components of our communities’ operations. These services include mystery shops, competing community analysis and product positioning. These services provide management with valuable and unbiased product and service information. A plan of action regarding any areas requiring improvement or change is implemented based on the information received.
The inspections also include observing residents in their daily activities and the community’s compliance with governmental regulations. Independent Service Evaluations. Periodically, we engage the services of outside professional independent consulting firms to evaluate various components of our communities’ operations. These services include mystery shops, competing community analysis and product positioning.
At communities where health care is delivered, these consulting service reviews include the on-site handling of medications, recordkeeping and general compliance with all applicable governmental regulations. Quality Assurance and Regional Support Team. The Company deploys a support team including senior level community-based resources to provide onboarding, training, and communication of best practices across each of our territories.
Quality Assurance and Regional Support Team. The Company deploys a support team including senior level community-based resources to provide onboarding, training, and communication of best practices across each of our territories. Each territory designates senior Executive Directors, Wellness Directors, Sales leadership, and Senior Culinary Directors to visit communities across their territory on an ongoing basis.
The inspection also includes monitoring staff professionalism and departmental reviews of maintenance, housekeeping, activities, transportation, marketing, administration, dining, and health care services, if applicable. The inspections also include observing residents in their daily activities and the community’s compliance with governmental regulations. Independent Service Evaluations.
Included as part of this inspection is the monitoring of the overall appearance and maintenance of the community interiors and grounds. The inspection 11 Table of Contents also includes monitoring staff professionalism and departmental reviews of maintenance, housekeeping, activities, transportation, marketing, administration, dining, and health care services, if applicable.
Regional directors and vice presidents make regular site visits to each of their assigned communities. Site visits involve a physical plant inspection, quality assurance review, focused resident rate review, staff training, financial and systems audits, regulatory compliance, and team building activities.
Site visits involve a physical plant inspection, quality assurance review, focused resident rate review, staff training, financial and systems audits, regulatory compliance, and team building activities. 10 Table of Contents Community-Based Management and Retention We devote special attention to the hiring, screening, training, supervising, and retention of our employees and caregivers to ensure that quality standards are achieved.
We continue to add new spaces to our recruiting landscape to ensure we are connecting with the best and brightest individuals. For example, we utilize local social media pages to identify individuals for the specific communities and geographic regions we serve.
For example, we utilize local social media pages to identify individuals for the specific communities and geographic regions we serve. We also utilize employee referral programs to bring great new people into our organization who already know our mission through current employees.
We also utilize employee referral programs to bring great new people into our organization who already know our mission through current employees. With our robust focus on talent acquisition, we continued to see our average time to fill an open role shorten significantly in 2024.
With our robust focus on talent acquisition, we continued to see our average time to fill open community leadership roles improve in 2025. We are proud of our development programs that sponsor our current employees in achieving new levels of education, licensure, and credentials.
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Strategy Our mission is to bring quality senior living to life.
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Recent Developments - Strategic Merger with CHP On March 11, 2026, pursuant to the Agreement and Plan of Merger, dated November 4, 2025 (the “Merger Agreement”), by and among the Company, SSL Sparti LLC, a Delaware limited liability company and a wholly owned subsidiary of the Company (“Holdco”), SSL Sparti Property Holdings Inc., a Maryland corporation and a wholly owned subsidiary of Holdco (f/k/a Sparti Merger Sub, Inc., “SNDA Merger Sub”), CNL Healthcare Properties, Inc., a public, non-traded real estate investment trust and Maryland corporation (“CHP”), and CHP Merger Corp., a Maryland corporation and a wholly owned subsidiary of CHP, the Company completed the previously announced acquisition of CHP through a series of steps ending with a forward merger of CHP with and into SNDA Merger Sub (the “CHP Merger”), with SNDA Merger Sub surviving the Merger.
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Subject to applicable governmental regulations, personal care and medical services are available to independent living residents through either the community staff or through independent home care agencies.
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As a result of the CHP Merger, the Company, through SNDA Merger Sub, now owns all of the assets of CHP. See “ Note 2–CHP Merger ” in the Notes to Consolidated Financial Statements included herein for additional information.
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Respite Care and Temporary Care Programs Our respite care and temporary care program provides a transitional apartment for seniors who are not entirely ready to return home after a hospital or rehabilitation stay.
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CHP owns a national portfolio of 69 high-quality senior housing communities, consisting of 54 communities that are managed by various third-party property managers pursuant to management agreements and 15 communities that are leased to third-party tenants pursuant to triple-net operating leases.
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(2) This community is not yet opened as of December 31, 2024. (3) This excludes 12 managed units that are owned by a third party.
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Of the 15 leased communities, 13 are leased to one tenant, under leases scheduled to expire in May 2030, subject to renewal options. Under the terms of the triple-net operating leases, each tenant is responsible for payment of property taxes, general liability insurance, utilities, repairs and maintenance, including structural and roof expenses.
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Community-Based Management and Retention We devote special attention to the hiring, screening, training, supervising, and retention of our employees and caregivers to ensure that quality standards are achieved. In addition to normal on-site training, we conduct national management meetings and encourage sharing of expertise among managers.
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Each tenant is expected to pay real estate taxes directly to the taxing authorities. Two of the CHP communities are skilled nursing facilities (“SNFs”), which are licensed healthcare facilities that provide rehabilitative and nursing care for people not requiring more extensive treatment at a hospital.
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Each community is inspected in person, on at least a quarterly basis, by a member of the regional and/or operational leadership team, which is also supplemented by virtual site visits. Included as part of this inspection is the monitoring of the overall appearance and maintenance of the community interiors and grounds.
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SNFs receive significant funding from government programs and are subject to extensive regulation, including federal and state laws covering the type and quality of medical and/or nursing care provided, ancillary services (e.g., respiratory, occupational, physical and infusion therapies), qualifications of the administrative personnel and nursing staff, the adequacy of the physical plant and equipment, reimbursement and rate setting and operating policies.
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There can be no assurance that our operations will not be materially and adversely affected by regulatory developments in the future.
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In addition, SNFs are subject to extensive laws and regulations pertaining to healthcare fraud and abuse, as well as comparable state laws. The CHP Merger more than doubles our owned units to approximately 14,700 and strengthens our presence in the South, Southeast and Midwest, while strategically expanding our national exposure to attractive markets in the Mountain West and Pacific Northwest.
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Total Rewards We provide fair, competitive, and aligned compensation to all of our people that is reviewed at least annually for both merit and market-based adjustments. We also offer benefits that are designed to fit a wide variety of needs.
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Following the CHP Merger, we will continue to provide services across the continuum of care, focused on up-market and mid-market, clustered around key regional markets with strong underlying growth fundamentals.
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We provide paid time off to both full-time and part-time employees to ensure they have paid time away from work. We also offer a 401(k) plan that all eligible employees can participate in as they plan for their futures.
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With the CHP Merger complete, we are currently focused on the process of integrating our and CHP’s business in a manner that facilitates synergies, cost savings, growth opportunities and achieves other anticipated benefits.
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We will seek to implement operational improvements and optimize our portfolio with a focus on assets operating with strong growth characteristics and long-term sustainable earnings, with the expectation of thoughtfully evaluating dispositions in low growth, non-strategic markets. The remainder of this “Item 1.
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Business” section specifically excludes the impact of the CHP Merger unless otherwise noted, as it was not a part of our business prior to March 11, 2026.
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Further information regarding the CHP Merger and CHP is set forth in (i) the Company’s Current Report on Form 8-K filed with the SEC on March 11, 2026 and (ii) the definitive joint proxy statement/prospectus that was filed with the SEC and declared effective on January 6, 2026. 2 Table of Contents Recent Developments – Conversion of Series A Preferred Stock and Warrant Extension On March 11, 2026, in order to induce the immediate full conversion of the Series A Convertible Preferred Stock (the “Series A Preferred Stock”), the Company entered into an agreement with the affiliates of Conversant Capital LLC that held all of the outstanding shares of Series A Preferred Stock (the “Conversant Preferred Investors”) and that hold all of the outstanding warrants to purchase common stock for $40.00 per share, which warrants were issued on November 3, 2021.
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Pursuant to the agreement, the conversion price of the Series A Preferred Stock was decreased from $40.00 per share of common stock to $32.00 per share of common stock, the expiration date of all of the outstanding warrants issued on November 3, 2021 was extended from November 3, 2026 to November 3, 2027, and the Company made a onetime payment to the Conversant Preferred Investors totaling $4.7 million in the aggregate.
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In addition, the Company paid the Conversant Preferred Investors $1.1 million, in the aggregate, for accrued but unpaid dividends through March 11, 2026. On March 11, 2026, all of the outstanding shares of Series A Preferred Stock were converted into 1,601,505 shares of common stock. Strategy Our mission is to bring quality senior living to life.
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Regional directors and divisional presidents make regular site visits to each of their assigned communities.
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These services provide management with valuable and unbiased product and service information. A plan of action regarding any areas requiring improvement or change is implemented based on the information received. At communities where health care is delivered, these consulting service reviews include the on-site handling of medications, recordkeeping and general compliance with all applicable governmental regulations.
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This benefit provides our people quick and easy access to care at no cost to them when they need to access it. We provide paid time off to both full-time and part-time employees to ensure they have paid time away from work.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeRisks Related to Our Business, Operations and Strategy • We have incurred losses from operations in each of the last two fiscal years and may do so in the future. 14 Table of Contents • We may be unsuccessful in integrating recent or future acquisitions into our existing operations or in realizing all or the anticipated benefits of such acquisitions. • We may not accurately estimate the benefits or synergies to be realized from the senior living communities and businesses we acquire. • Our investments in joint ventures could be adversely affected by our lack of exclusive control over these investments, our partners’ insolvency or failure to meet their obligations and disputes between us and our partners. • We largely rely on private pay residents and circumstances that adversely affect the ability of the seniors to pay for our services could have a material adverse effect on us. • Changes in the reimbursement rates, methods, or timing of payment from government reimbursement programs could adversely affect our revenues, results of operations, and cash flow. • The senior living services industry is very competitive and some competitors may have substantially greater financial resources than us. • Termination of resident agreements and resident attrition could affect adversely our revenues and earnings. • We rely on information technology in our operations, and failure to maintain the security and functionality of our information technology and computer systems, or to prevent a cybersecurity attack, breach or other unauthorized access, could adversely affect our business, reputation and relationships with our residents, employees and referral sources and may subject us to remediation costs, government inquiries and liabilities under HIPAA and data and consumer protection laws, any of which could materially and adversely impact our revenues, results of operations, cash flow, and liquidity. • We have identified a material weakness in our internal controls over financial reporting as of December 31, 2024.
Biggest changeRisks Related to Our Business, Operations and Strategy • We may be unsuccessful in integrating recent or future acquisitions into our existing operations or in realizing all or the anticipated benefits of such acquisitions, including the CHP Merger, and the closing of such acquisitions, including the CHP Merger, may adversely affect our business, financial condition, operations, stock price and market value. • CHP’s third-party managers and tenants expose us to additional operational risks. • The obligations and liabilities of CHP, some of which may be unanticipated or unknown, may be greater than we have anticipated, which may diminish the value of CHP to us. • We have incurred and are expected to incur substantial expenses related to the integration of the Company and CHP. 15 Table of Contents • We may not have accurately estimated the benefits or synergies to be realized from businesses we acquired, including CHP. • Our investments in joint ventures could be adversely affected by our lack of exclusive control over these investments, our partners’ insolvency or failure to meet their obligations and disputes between us and our partners. • We largely rely on private pay residents and circumstances that adversely affect the ability of the seniors to pay for our services could have a material adverse effect on us. • Changes in the reimbursement rates, methods, or timing of payment from government reimbursement programs could adversely affect our revenues, results of operations, and cash flow. • The senior living services industry is very competitive and some competitors may have substantially greater financial resources than us. • Termination of resident agreements and resident attrition could adversely affect our revenues and earnings. • We have incurred losses from operations in each of the last two fiscal years and may do so in the future. • We rely on information technology in our operations, and failure to maintain the security and functionality of our information technology and computer systems, or to prevent a cybersecurity attack, breach or other unauthorized access, could adversely affect our business, reputation and relationships with our residents, employees and referral sources and may subject us to remediation costs, government inquiries and liabilities under HIPAA and data and consumer protection laws, any of which could materially and adversely impact our revenues, results of operations, cash flow, and liquidity.
To the extent that significant changes in the climate occur in areas where our communities are located, we may experience increased frequency of severe weather conditions or natural disasters or other changes to weather patterns, all of which may result in physical damage to or a decrease in demand for properties affected by these conditions.
To the extent that significant changes in the climate occur in areas where our communities are located, we may experience increased frequency of severe weather conditions or natural disasters or other changes to weather patterns, all of which may result in physical damage to or a decrease in demand for communities affected by these conditions.
Our business and operations are exposed to risks from, severe cold and flu seasons or the occurrence of other epidemics, pandemics, widespread illnesses or public health crises, as occurred during the height of the COVID-19 pandemic. A future epidemic, pandemic, widespread illness or public health crisis could adversely impact our occupancy levels, revenues, expenses and operating results at our communities.
Our business and operations are exposed to risks from, severe cold and flu seasons or the occurrence of other epidemics, pandemics, widespread illnesses or public health crises, as occurred during the height of the pandemic. A future epidemic, pandemic, widespread illness or public health crisis could adversely impact our occupancy levels, revenues, expenses and operating results at our communities.
A certain number of our properties are located in areas that have experienced, and may experience in the future, catastrophic weather and other natural events from time to time, including snow or ice storms, windstorm, tornados, hurricanes, fires, earthquakes, freeze events in warmer climates, flooding or other severe weather.
A certain number of our communities are located in areas that have experienced, and may experience in the future, catastrophic weather and other natural events from time to time, including snow or ice storms, windstorm, tornados, hurricanes, fires, earthquakes, freeze events in warmer climates, flooding or other severe weather.
If a large number of residents elected to or otherwise terminate their resident agreements at or around the same time and/or the living spaces we lease remain unoccupied for a long period of time, our occupancy revenues, cash flows and earnings could be adversely affected.
If a large number of residents elect to or otherwise terminate their resident agreements at or around the same time and/or the living spaces we lease remain unoccupied for a long period of time, our occupancy revenues, cash flows and earnings could be adversely affected.
Federal anti-kickback laws have been broadly interpreted to apply to some contractual relationships between health care providers and sources of patient referral. Similar state laws vary, are sometimes vague and seldom have been interpreted by courts or regulatory agencies.
Federal anti-kickback laws have been broadly interpreted to apply to some contractual relationships between health care providers and sources of patient referrals. Similar state laws vary, are sometimes vague and seldom have been interpreted by courts or regulatory agencies.
If the federal or state governments fail to make payments under these programs on a timely basis, our business could suffer, and our financial position, results of operations or cash flow may be materially affected. 19 Table of Contents The senior living services industry is very competitive and some competitors may have substantially greater financial resources than us.
If the federal or state governments fail to make payments under these programs on a timely basis, our business could suffer, and our financial position, results of operations or cash flow may be materially affected. The senior living services industry is very competitive and some competitors may have substantially greater financial resources than us.
For 2025, we expect to continue to experience labor cost pressure as a result of the continuing labor conditions previously described, changes to immigration laws, and an anticipated increase in hours worked as our occupancy levels grow.
For 2026, we expect to continue to experience labor cost pressure as a result of the continuing labor conditions previously described, changes to immigration laws, and an anticipated increase in hours worked as our occupancy levels grow.
Our ability to meet our long-term capital requirements, including the repayment of certain long-term debt obligations, will depend, in part, on our ability to obtain additional financing or refinancings on acceptable terms from available financing sources, including through the use of mortgage financing, joint venture arrangements, by accessing the debt and/or equity markets and possibly through operating leases or other types of financing, such as lines of credit.
Our ability to meet our capital requirements, including the repayment of our debt obligations, will depend, in part, on our ability to obtain additional financing or refinancings on acceptable terms from available financing sources, including through the use of mortgage financing, joint venture arrangements, by accessing the debt and/or equity markets and possibly through operating leases or other types of financing, such as lines of credit.
There can be no assurance that financing or refinancings will be available or that, if available, will be on terms acceptable to us. Moreover, raising additional funds through the issuance of additional equity securities could cause existing stockholders to experience further dilution and could adversely affect the market price of our common stock. See “Item 1A.
There can be no assurance that financing or refinancings will be available or that, if available, will be on terms acceptable to us. Moreover, raising additional funds through the issuance of additional equity securities could cause existing stockholders to experience further 17 Table of Contents dilution and could adversely affect the market price of our common stock. See “Item 1A.
Integration of these acquisitions is subject to numerous risks and challenges, including (i) the potential for unexpected costs, delays and challenges that may arise in integrating acquired communities into our existing portfolio of communities and business; (ii) limitations on our ability to realize any expected cost savings and synergies from the acquisition; and (iii) discovery of previously unknown liabilities following the acquisition for which we cannot receive reimbursement under any applicable indemnification provisions.
Integration of these acquisitions is subject to numerous risks and challenges, including (i) the potential for unexpected costs, delays and challenges that may arise in integrating acquired communities into our existing portfolio of communities and business; (ii) limitations on our ability to realize any expected cost savings and synergies from the acquisitions; and (iii) discovery of previously unknown 18 Table of Contents liabilities following the acquisitions for which we cannot receive reimbursement under any applicable indemnification provisions.
In addition, government regulation intended to mitigate the impact of climate change, severe weather patterns, or natural disasters, including 22 Table of Contents sustainability-related laws such as emissions reduction, could result in additional required capital expenditures to comply with such regulation without a corresponding increase in our revenues.
In addition, government regulation intended to mitigate the impact of climate change, severe weather patterns, or natural disasters, including sustainability-related laws such as emissions reduction, could result in additional required capital expenditures to comply with such regulation without a corresponding increase in our revenues.
Our failure to obtain such financing or refinancing on terms acceptable to us would have a material adverse effect on our business, financial condition, cash flows, and results of operations.
Our failure to obtain additional financing or refinancing on terms acceptable to us would have a material adverse effect on our business, financial condition, cash flows, and results of operations.
Among the proposals that have been introduced are price controls on hospitals, insurance market reforms to increase the availability of group health insurance to small businesses, requirements that all businesses offer health insurance coverage to their employees and the creation of government health insurance plans that would cover all citizens and increase payments by beneficiaries.
Among the proposals that have been introduced 27 Table of Contents are price controls on hospitals, insurance market reforms to increase the availability of group health insurance to small businesses, requirements that all businesses offer health insurance coverage to their employees and the creation of government health insurance plans that would cover all citizens and increase payments by beneficiaries.
The provisions of the 24 Table of Contents legislation and other regulations implementing the provisions of the Affordable Care Act or any amended or replacement legislation may increase our costs, adversely affect our revenues, expose us to expanded liability or require us to revise the ways in which we conduct our business.
The provisions of the legislation and other regulations implementing the provisions of the Affordable Care Act or any amended or replacement legislation may increase our costs, adversely affect our revenues, expose us to expanded liability or require us to revise the ways in which we conduct our business.
Furthermore, if the development of new senior housing communities outpaces the demand for those communities in the markets in which we have senior housing communities, those markets may become saturated. Regulation in the independent and assisted living industry is not substantial. Consequently, development of new senior housing communities could outpace demand.
Furthermore, if the development of new senior housing communities outpaces the demand for those communities in the markets in which we have senior housing communities, those markets may become saturated. Regulation regarding entry into the independent and assisted living industry is not substantial. Consequently, development of new senior housing communities could outpace demand.
Joint ventures may require us to share decision-making authority with our partners, which could limit our ability to control the properties in the joint ventures. Even when we have a controlling interest, certain major decisions may require partner approval, such as the sale, acquisition or financing of a property.
Joint ventures may require us to share decision-making authority with our partners, which could limit our ability to control the communities in the joint ventures. Even when we have a controlling interest, certain major decisions may require partner approval, such as the sale, acquisition or financing of a community.
We may not realize the anticipated benefits from the acquisitions that we do consummate, including the acquisitions consummated in 2024, and we may face difficulties in managing the expanded operations of a larger and more complex company.
We may not realize the anticipated benefits from the acquisitions that we do consummate, including the CHP Merger and the acquisitions consummated in 2025 and 2024, and we may face difficulties in managing the expanded operations of a larger and more complex company.
We have recently made the annual rate adjustment effective March 1, 2025 for our in-place private pay residents.
We have recently made the annual rate adjustment effective March 1, 2026 for our in-place private pay residents.
Changes in the reimbursement rates, methods, or timing of payment from government reimbursement programs could adversely affect our revenues, results of operations, and cash flow. We rely on reimbursement from government programs for a portion of our revenues. For the year ended December 31, 2024, Medicaid reimbursements represented approximately 10.1% of our resident revenues from communities that we operated.
Changes in the reimbursement rates, methods, or timing of payment from government reimbursement programs could adversely affect our revenues, results of operations, and cash flow. We rely on reimbursement from government programs for a portion of our revenues. For the year ended December 31, 2025, Medicaid reimbursements represented approximately 7.7% of our resident revenues from communities that we operated.
In addition, expanded use of telemedicine and home healthcare by seniors, for which regulatory barriers have been relaxed during the pandemic, may result in additional competition for our services. We also compete with other health care businesses with respect to attracting and retaining nurses, technicians, aides and other high-quality professional and non-professional employees and managers.
In addition, expanded use of telemedicine and home healthcare by seniors, for which regulatory barriers were relaxed as a result of the pandemic, may result in additional competition for our services. We also compete with other health care businesses with respect to attracting and retaining nurses, technicians, aides and other high-quality professional and non-professional employees and managers.
As cyber threats continue to evolve, such as threats related to AI, we may be required to expend significant additional resources to 20 Table of Contents continue to modify or enhance our cybersecurity or to investigate and remediate any cybersecurity vulnerabilities, attacks, or incidents.
As cyber threats continue to evolve, such as threats related to AI, we may be required to expend significant additional resources to continue to modify or enhance our cybersecurity or to investigate and remediate any cybersecurity vulnerabilities, attacks, or incidents.
New laws and regulations are being adopted in the U.S. and in non-U.S. jurisdictions, and existing laws 23 Table of Contents and regulations may be interpreted in ways that would affect our business operations and the way in which we use AI.
New laws and regulations are being adopted in the U.S. and in non-U.S. jurisdictions, and existing laws and regulations may be interpreted in ways that would affect our business operations and the way in which we use AI.
This presence is impacted by general economic and market conditions and investors’ views of us. Because our trading volume is limited relative to larger public companies, any significant sales of our shares of common stock could cause a decline in the market value and price per share of our common stock.
This presence is impacted by general economic and market conditions and investors’ views of us. Because our trading volume is limited relative to larger public companies, any significant sales of our shares of common stock could cause a decline in the market value and price per share of our common stock. ITEM 1B. UNRESOLVED STAFF COMMENTS. None.
As of December 31, 2024, we had approximately $253.2 million of long-term variable rate debt outstanding which is indexed to the Secured Overnight Financing Rate (“SOFR”), plus an applicable margin. Accordingly, our annual interest expense related to long-term variable rate debt is directly affected by movements in SOFR.
As of December 31, 2025, we had approximately $306.4 million of long-term variable rate debt outstanding which is indexed to the Secured Overnight Financing Rate (“SOFR”), plus an applicable margin. Accordingly, our annual interest expense related to long-term variable rate debt is directly affected by movements in SOFR.
Risks Related to Regulatory, Compliance, and/or Legal Matters • We are subject to governmental regulations and compliance, some of which are burdensome and some of which may change to our detriment in the future. • Changes in federal, state and local employment-related laws and regulations, or our failure to comply with these laws and regulations, could have an adverse effect on our financial condition, results of operations, and cash flow. 15 Table of Contents • We may be subject to liability for environmental damages.
Risks Related to Regulatory, Compliance, and/or Legal Matters • We are subject to governmental regulations and compliance, some of which are burdensome and some of which may change to our detriment in the future. • Changes in federal, state and local employment-related laws and regulations, or our failure to comply with these laws and regulations, could have an adverse effect on our financial condition, results of operations, and cash flow.
The acquisition component of our growth strategy depends on the successful integration of acquisitions, including the communities acquired in 2024 and communities that will be acquired in the future.
The acquisition component of our growth strategy depends on the successful integration of acquisitions, including the communities acquired in 2025, the CHP Merger, and communities that will be acquired in the future.
In addition, our insurance policies must be renewed annually. Based upon poor loss experience and the impact of pandemics, insurers for the long-term care industry have become increasingly wary of liability exposure. A number of insurance carriers have stopped writing coverage to this market or reduced the level of coverage offered, and those remaining have increased premiums and deductibles substantially.
Based upon poor loss experience and the impact of pandemics, insurers for the long-term care industry have become increasingly wary of liability exposure. A number of insurance carriers have stopped writing coverage to this market or reduced the level of coverage offered, and those remaining have increased premiums and deductibles substantially.
The market price for our common stock may be influenced by many factors, including the following: • our operating and financial performance and prospects; • our quarterly or annual earnings or those of other companies in our industry; • the public’s reaction to our press releases, other public announcements and filings with the SEC; • changes in earnings estimates or recommendations by securities analysts who track our common stock; • market and industry perception of our success, or lack thereof, in pursuing our strategies; • strategic actions by us or our competitors, such as acquisitions or joint ventures; • our ability or inability to raise additional capital and the terms on which we raise it; • changes in accounting standards, policies, guidance, interpretations or principles; • arrival and departure of key personnel; • changes in our capital structure; • trading volume of our common stock; • sales of our common stock by us or our stockholders, including Conversant and Silk; 29 Table of Contents • changes in general market, industry, economic and political conditions in the U.S. and global economies or financial markets; and • other events or factors, including war, terrorism and other international conflicts, public health issues including health epidemics or pandemics and natural disasters such as fire, hurricanes, earthquakes, tornados or other adverse weather and climate conditions.
The market price for our common stock may be influenced by many factors, including the following: • our operating and financial performance and prospects; • our quarterly or annual earnings or those of other companies in our industry; • the public’s reaction to our press releases, other public announcements and filings with the SEC; • changes in earnings estimates or recommendations by securities analysts who track our common stock; • market and industry perception of our success, or lack thereof, in pursuing our strategies; • strategic actions by us or our competitors, such as acquisitions or joint ventures; • our ability or inability to raise additional capital and the terms on which we raise it; • changes in accounting standards, policies, guidance, interpretations or principles; • arrival and departure of key personnel; • our ability to integrate any business we acquire, including CHP, with our business and to achieve anticipated synergies; • changes in our capital structure; • trading volume of our common stock; • sales of our common stock by us or our stockholders, including Conversant and Silk; • changes in general market, industry, economic and political conditions in the U.S. and global economies or financial markets; and • other events or factors, including war, terrorism and other international conflicts, public health issues including health epidemics or pandemics and natural disasters such as fire, hurricanes, earthquakes, tornados or other adverse weather and climate conditions. 30 Table of Contents Since the stock price of our common stock has fluctuated in the past, has been recently volatile and may be volatile in the future, investors in our common stock could incur substantial losses.
Further, we have registered the resale of shares of common stock issued to certain stockholders that are either outstanding or issuable upon conversion of Series A Preferred Stock and the exercise of outstanding warrants.
Further, we have registered the resale of shares of common stock issued to certain stockholders that are either outstanding or issuable upon the exercise of outstanding warrants.
During the year ended December 31, 2024, our common stock traded at a low of $8.65 and a high of $34.26. We may continue to experience sustained depression or substantial volatility in our stock price in the foreseeable future unrelated to our operating performance or prospects.
During the year ended December 31, 2025, our common stock traded at a low of $19.34 and a high of $33.50. We may continue to experience sustained depression or substantial volatility in our stock price in the foreseeable future unrelated to our operating performance or prospects.
Risk Factors Summary Risks Related to Our Liquidity and Indebtedness • We have significant debt and our failure to generate cash flow sufficient to cover required interest and principal payments could result in defaults of the related debt. • Our failure to comply with financial covenants and other restrictions contained in our debt instruments could result in the acceleration of the related debt or in the exercise of other remedies. • We may require additional financing and/or refinancing actions in the future and may issue equity securities. • Elevated market interest rates, or future interest rate increases, could significantly increase the costs of our variable rate debt obligations, which may affect our cost of capital and, as a result, liquidity and earnings. • We may need additional capital to fund our operations, capital expenditure plans, and strategic priorities, and we may not be able to obtain it on terms acceptable to us, or at all.
Risk Factors Summary Risks Related to Our Liquidity and Indebtedness • We have significant debt and our failure to generate cash flow sufficient to cover required interest and principal payments could result in defaults of the related debt. • Our failure to comply with financial covenants and other restrictions contained in our debt instruments could result in the acceleration of the related debt or in the exercise of other remedies. • We may require additional financing and/or refinancing actions in the future and may issue equity securities. • Elevated market interest rates, or future interest rate increases, could significantly increase the costs of our variable rate debt obligations, which may affect our cost of capital and, as a result, liquidity and earnings.
Current global economic conditions and uncertainties, the potential for failures or realignments of financial institutions and the related impact on available credit may affect us and our business partners, landlords, counterparties and residents or prospective residents in an adverse manner including, but not limited to, reducing access to liquid funds or credit, increasing the cost of credit, limiting our ability to manage operating costs, increasing the risk that certain of our business partners, landlords or counterparties would be unable to fulfill their obligations to us, and other impacts which we are unable to fully anticipate. 28 Table of Contents Our non-labor operating expenses have historically comprised of approximately one-third of our total operating expenses and are subject to the labor force available to us and other factors, including government regulations.
Current global economic conditions and uncertainties, the potential for failures or realignments of financial institutions and the related impact on available credit may affect us and our business partners, landlords, counterparties and residents or prospective residents in an adverse manner including, but not limited to, reducing access to liquid funds or credit, increasing the cost of credit, limiting our ability to manage operating costs, increasing the risk that certain of our business partners, landlords or counterparties would be unable to fulfill their obligations to us, and other impacts which we are unable to fully anticipate.
Risks Related to Human Capital • A significant increase in our labor costs or labor shortages could have a material adverse effect on us. • We rely on the services of key executive officers and the transition of management or loss of these officers or their services could have a material adverse effect on us. • We are subject to risks related to the provision for employee health care benefits and future health care reform legislation.
Risks Related to Human Capital • A significant increase in our labor costs or labor shortages could have a material adverse effect on us. • We rely on the services of key executive officers and the transition of management or loss of these officers or their services could have a material adverse effect on us.
As of December 31, 2024, we had mortgage and other indebtedness, excluding deferred loan costs, totaling approximately $655.2 million and we had an additional borrowing capacity of up to $34.4 million under our senior secured revolving credit facility.
As of December 31, 2025, we had mortgage and other indebtedness, excluding deferred loan costs, totaling approximately $693.1 million and we had an additional borrowing capacity of up to $40.0 million under our senior secured revolving credit facility.
Approximately 89.9% of our total resident revenues from communities that we operated were attributable to private pay sources and approximately 10.1% of our resident revenues from these communities were attributable to reimbursements from Medicaid, in each case, during fiscal year 2024.
Approximately 92.3% of our total resident revenues from communities that we operated were attributable to private pay sources and approximately 7.7% of our resident revenues from these communities were attributable to reimbursements from Medicaid, in each case, during fiscal year 2025.
There could also be healthcare, regulatory, environmental, or other problems that were not discovered in the course of our due diligence and inspections.
The accuracy of our assessments of new acquisitions and our estimates are inherently uncertain. There could also be healthcare, regulatory, environmental, or other problems that were not discovered in the course of our due diligence and inspections.
Pursuant to our investor rights agreement, Conversant Fund A is entitled to designate four individuals to be appointed to the Company’s board of directors, (which will increase to five individuals on May 3, 2025), including the Chairperson, and Silk Partners LP is entitled to designate two individuals to be appointed to the Company’s board of directors, in each case so long as they and their respective permitted transferees and affiliates maintain minimum aggregate holdings of our stock as described in further detail in the investor rights agreement.
Pursuant to the amended and restated investor rights agreement, Conversant Fund A is currently entitled to designate three individuals to be appointed to the Company’s board of directors, including the Chairperson, and Silk Partners LP is currently entitled to designate one individual to be appointed to the Company’s board of directors, in each case so long as they and their respective permitted transferees and affiliates maintain minimum aggregate holdings of our stock as described in further detail in the amended and restated investor rights agreement.
Funding our capital expenditure plans, pursuing an acquisition, or funding investments to support our strategy may require additional capital. Financing may not be available to us or may be available to us only on terms that are unfavorable. In addition, certain of our outstanding indebtedness restrict, among other things, our (or our subsidiaries’) ability to incur additional debt.
Financing may not be available to us or may be available to us only on terms that are unfavorable. In addition, certain of our outstanding indebtedness restrict, among other things, our (or our subsidiaries’) ability to incur additional debt.
Further, we entered into an investor rights agreement with certain of our largest stockholders that prohibits certain change of control transactions without the prior written consent of Conversant Fund A and the existence of a majority stockholder, such as Conversant, may also have the effect of deterring hostile takeovers, delaying or preventing changes in control or changes in management, or limiting the ability of our other stockholders to approve transactions that they may deem to be in the best interests of our company.
Further, we entered into an amended and restated investor rights agreement with certain of our largest stockholders that prohibits certain change of control transactions without the prior written consent of Conversant Fund A, which may also have the effect of deterring hostile takeovers, delaying or preventing changes in control or changes in management, or limiting the ability of our other stockholders to approve transactions that they may deem to be in the best interests of our company. 28 Table of Contents Several of our loan documents and other material agreements also require approval in the event we undergo a change of control of our Company.
We also may be required to make additional employee-related changes to our business as a result of provisions in the Affordable Care Act or any amended or replacement legislation impacting the provision of health insurance by employers, which could result in additional expense and adversely affect our results of operations and cash flow.
We also may be required to make additional employee-related changes to our business as a result of provisions in the Affordable Care Act or any amended or replacement legislation impacting the provision of health insurance by employers, which could result in additional expense and adversely affect our results of operations and cash flow. 26 Table of Contents Risks Related to Regulatory, Compliance and/or Legal Matters We are subject to governmental regulations and compliance, some of which are burdensome and some of which may change to our detriment in the future.
We have a high concentration of communities in various geographic areas, including the states of Texas, Indiana, Ohio and Wisconsin, which we estimate represented approximately 23%, 17%, 19%, and 9%, respectively, of our resident revenues for the year ended December 31, 2024.
We have a high concentration of communities in various geographic areas, including the states of Texas, Indiana, Ohio and Florida, which we estimate represented approximately 22%, 13%, 18%, and 10%, respectively, of our resident revenues for the year ended December 31, 2025.
Risks Related to Other Market Factors • Various factors, including general economic conditions such as elevated labor costs , could adversely affect our financial performance and other aspects of our business. • Future sales of equity securities by us or certain stockholders may adversely affect the market price of our common stock. • Our stock price has fluctuated in the past, has recently been volatile and may be volatile in the future, and as a result, investors in our common stock could incur substantial losses. • Our trading volume may not provide adequate liquidity for investors. • We may issue debt and preferred equity securities or securities convertible into preferred equity securities, any of which may be senior to our common stock as to distributions and in liquidation.
Risks Related to Other Market Factors • Various factors, including general economic conditions such as elevated labor costs , could adversely affect our financial performance and other aspects of our business. • Future sales of equity securities by us or certain stockholders may adversely affect the market price of our common stock. • Our stock price has fluctuated in the past, has recently been volatile and may be volatile in the future, and as a result, investors in our common stock could incur substantial losses. • Our trading volume may not provide adequate liquidity for investors. 16 Table of Contents Risk Factors Risks Related to Our Liquidity and Indebtedness We have significant debt and our failure to generate cash flow sufficient to cover required interest and principal payments could result in defaults of the related debt.
Such litigation, if instituted against us, could result in substantial costs and diversion of management’s attention and resources, which could materially and adversely affect our business, financial condition, results of operations and growth prospects.
In the past, following periods of volatility in the market, securities class-action litigation has often been instituted against companies. Such litigation, if instituted against us, could result in substantial costs and diversion of management’s attention and resources, which could materially and adversely affect our business, financial condition, results of operations and growth prospects.
Additional risks and uncertainties not known to us currently or that currently we deem to be immaterial also may impair our business operations. Immediately below is a summary of the principal factors that might cause our future operating results to differ materially from those currently expected. The risk factors summarized below are not the only risks facing us.
Immediately below is a summary of the principal factors that might cause our future operating results to differ materially from those currently expected. The risk factors summarized below are not the only risks facing us.
In addition to the anti-takeover provisions described above, we are subject to Section 203 of the Delaware General Corporation Law. Section 203 generally prohibits a person beneficially owning, directly or indirectly, 15% or more of our outstanding common stock from engaging in a business combination with us for three years after the person acquired the stock.
Section 203 generally prohibits a person beneficially owning, directly or indirectly, 15% or more of our outstanding common stock from engaging in a business combination with us for three years after the person acquired the stock.
We rely on information technology in our operations, and failure to maintain the security and functionality of our information technology and computer systems, or to prevent a cybersecurity attack, breach or other unauthorized access, could adversely affect our business, reputation and relationships with our residents, employees and referral sources and may subject us to remediation costs, government inquiries and liabilities under HIPAA and data and consumer protection laws, any of which could materially and adversely impact our revenues, results of operations, cash flow, and liquidity.
We rely on information technology in our operations, and failure to maintain the security and functionality of our information technology and computer systems, or to prevent a cybersecurity attack, breach or other unauthorized access, could adversely affect our business, reputation and relationships with our residents, employees and referral sources and may subject us to remediation costs, government inquiries and liabilities under HIPAA and data and consumer protection laws, any of which could materially and adversely impact our revenues, results of operations, cash flow, and liquidity. 22 Table of Contents We rely upon the proper function and availability of our information technology and computer systems, including hardware, software, applications and electronic data storage, to communicate with our residents and patients, their doctors and other healthcare providers, and our employees and vendors and to store, process, safeguard and transmit our business information, including proprietary business information, private health information and personally identifiable information of our residents and employees.
Any payment or other default could cause the applicable lender to foreclose upon the communities securing the indebtedness with a consequent loss of income and asset value to us.
Any payment or other default could cause the applicable lender to foreclose upon the communities securing the indebtedness with a consequent loss of income and asset value to us. Further, because of cross-default and cross-collateralization provisions, a payment or other default by us with respect to one community could affect a significant number of our other communities.
Therefore, an event of default under the outstanding indebtedness, subject to cure provisions in certain instances, would give the respective lenders, the right to declare all amounts outstanding to be immediately due and payable, or foreclose on collateral securing the outstanding indebtedness. 16 Table of Contents There are various financial covenants and other restrictions in certain of our debt instruments, including provisions which: • require us to meet specified financial tests, which include, but are not limited to, tangible net worth and liquidity requirements; • require us to make payments on time; • require us to meet specified financial tests at the community level; • require us to purchase interest rate derivative instruments; • require us to meet specified reserve requirements; • require us to maintain the physical condition of the community and meet certain minimum spending levels for capital and leasehold improvements; and • require consent for changes in control of us.
There are various financial covenants and other restrictions in certain of our debt instruments, including provisions which: • require us to meet specified financial tests, which include, but are not limited to, tangible net worth and liquidity requirements; • require us to make payments on time; • require us to meet specified financial tests at the community level; • require us to purchase interest rate derivative instruments; • require us to meet specified reserve requirements; • require us to maintain the physical condition of the community and meet certain minimum spending levels for capital and leasehold improvements; and • require consent for changes in control of us.
In addition, if a senior living community is determined to be out of compliance with these requirements, it may be subject to fines and other regulatory penalties, including the suspension of resident admissions, the termination of Medicaid participation or the suspension or revocation of licenses.
In addition, if a senior living community is determined to be out of compliance with these requirements, it may be subject to fines and other regulatory penalties, including the suspension of resident admissions, the termination of Medicaid participation or the suspension or revocation of licenses. 29 Table of Contents Future sales of equity securities by us or certain stockholders may adversely affect the market price of our common stock.
Our expected benefits and synergies from new acquisitions may not be realized if our estimates regarding such acquisitions are materially inaccurate or if we fail to identify operating problems or liabilities prior to closing. The accuracy of our assessments of new acquisitions and our estimates are inherently uncertain.
We may not have accurately estimated the benefits or synergies to be realized from businesses we acquired, including CHP. Our expected benefits and synergies from new acquisitions, including the CHP Merger, may not be realized if our estimates regarding such acquisitions are materially inaccurate or if we failed to identify operating problems or liabilities prior to closing.
We compete with other providers of senior living services with respect to attracting and retaining qualified management personnel responsible for the day-to-day operations of each of our communities and skilled personnel responsible for providing resident care. In light of labor shortages for medical and non-medical workers in many geographic areas, we may increasingly compete to attract qualified and experienced employees.
We compete with other providers of senior living services with respect to attracting and retaining qualified management personnel responsible for the day-to-day operations of each of our communities and skilled personnel responsible for providing resident care.
Revenues from Medicaid have, and are expected to continue to, come under pressure due to reimbursement cuts and state budget shortfalls and changes in reimbursement policies and other governmental regulation resulting from actions by the U.S. Congress, U.S. executive orders or other governmental or regulatory agencies may result in a reduction in our revenue relating to such government programs.
Revenues from Medicaid have, and are expected to continue to, come under pressure due to reimbursement cuts and state budget shortfalls and changes in reimbursement policies and other governmental regulation resulting from actions by the U.S.
Future sales of equity securities by us or certain stockholders may adversely affect the market price of our common stock. We have increased, and may again in the future, attempt to increase, our capital resources by offering additional equity securities.
We have increased, and may again in the future, attempt to increase, our capital resources by offering additional equity securities.
Accordingly, holders of our common stock must look solely to appreciation of our common stock to realize a gain on their investment. This appreciation may not occur. We cannot predict the potential emergence and effects of a severe cold and flu season or a future pandemic, epidemic or outbreak of an infectious disease, on our operations, financial condition and liquidity.
We cannot predict the potential emergence and effects of a severe cold and flu season or a future pandemic, epidemic or outbreak of an infectious disease, on our operations, financial condition and liquidity.
In addition, some states have begun to enact more comprehensive privacy laws and regulations addressing consumer rights to data protection or transparency. For example, the California Consumer Privacy Act became effective in 2020, and we expect additional federal and state legislative and regulatory efforts to regulate consumer privacy protection in the future.
For example, the California Consumer Privacy Act became effective in 2020, and we expect additional federal and state legislative and regulatory efforts to regulate consumer privacy protection in the future.
In our consolidated community portfolio the labor component of our operating expense increased approximately $15.7 million, or 14.1%, during 2024 compared to 2023. These increases primarily resulted from filling our open positions, merit and market wage rate adjustments, more hours worked with higher occupancy during 2024, and an increase in the use of premium labor, primarily overtime.
These increases primarily resulted from labor expenses related to newly acquired properties during 2025 and 2024, filling our open positions, merit and market wage rate adjustments, more hours worked with higher occupancy during 2025, and an increase in the use of premium labor, primarily overtime.
HIPAA has also established standards governing uniform health care transactions, the codes and identifiers to be used by the covered entities and standards governing the security of certain electronic transactions conducted by covered entities.
HIPAA has also established standards governing uniform health care transactions, the codes and identifiers to be used by the covered entities and standards governing the security of certain electronic transactions conducted by covered entities. Penalties for violations can range from civil money penalties for errors and negligent acts to criminal fines and imprisonment for knowing and intentional misconduct.
Accordingly, the benefits from planned acquisitions may be offset by costs incurred to, or delays in, integrating the businesses. Additionally, integration challenges could also divert management’s attention from ongoing operations and opportunities. We may not accurately estimate the benefits or synergies to be realized from the senior living communities and businesses we acquire.
While it is anticipated that certain expenses will be incurred to achieve cost synergies, such expenses are difficult to estimate accurately and may exceed current estimates. Accordingly, the benefits from planned acquisitions may be offset by costs incurred to, or delays in, integrating the businesses. Additionally, integration challenges could also divert management’s attention from ongoing operations and opportunities.
However, we may become subject to claims in excess of our insurance or claims not covered by our insurance, such as claims for punitive damages, terrorism and natural disasters. A claim against us not covered by, or in excess of, our insurance limits could have a material adverse effect upon our business, financial condition, cash flows, and results of operations.
However, we may become subject to claims in excess of our insurance or claims not covered by our insurance, such as claims for punitive damages, terrorism and natural disasters.
If we become subject to any of these claims, the costs involved could be significant and could have a material adverse effect on our business, financial condition, cash flows and results of operations. 26 Table of Contents Risks Related to Our Corporate Organization and Structure Anti-takeover provisions in our governing documents, governing law, and material agreements may discourage, delay or prevent a merger or acquisition that our stockholders may consider favorable or prevent the removal of our current board of directors and management.
Risks Related to Our Corporate Organization and Structure Anti-takeover provisions in our governing documents, governing law, and material agreements may discourage, delay or prevent a merger or acquisition that our stockholders may consider favorable or prevent the removal of our current board of directors and management.
ITEM 1A. RISK FACTORS. Our business involves various risks and uncertainties. When evaluating our business, the following information should be carefully considered in conjunction with the other information contained in our periodic filings with the Securities and Exchange Commission (the “SEC”).
ITEM 1A. RISK FACTORS. Our business involves various risks and uncertainties. When evaluating our business, the following information should be carefully considered in conjunction with the other information contained in our periodic filings with the SEC. Additional risks and uncertainties not known to us currently or that currently we deem to be immaterial also may impair our business operations.
In addition, developing and implementing an interest rate risk strategy is complex, and no strategy can completely insulate us from risks associated with interest rate fluctuations and there can be no assurance that our hedging activities will be effective. 17 Table of Contents We may need additional capital to fund our operations, capital expenditure plans, and strategic priorities, and we may not be able to obtain it on terms acceptable to us, or at all.
In addition, developing and implementing an interest rate risk strategy is complex, and no strategy can completely insulate us from risks associated with interest rate fluctuations and there can be no assurance that our hedging activities will be effective.
The costs of obtaining additional interest rate cap derivatives may offset the benefits of our existing interest rate cap agreements.
We have interest rate caps for $194.2 million, which is the majority of the outstanding variable rate debt. The costs of obtaining additional interest rate cap derivatives may offset the benefits of our existing interest rate cap agreements.
A shortage of nurses or trained personnel may require us to enhance our wage and benefits package in order to compete in the hiring and retention of these personnel or to hire more expensive temporary personnel. We also will be dependent on the available labor pool of semi-skilled and unskilled employees in each of the markets in which we operate.
We rely upon the quality of our staff as a means to differentiate our services from other providers. A shortage of nurses or trained personnel may require us to enhance our wage and benefits package in order to compete in the hiring and retention of these personnel or to hire more expensive temporary personnel.
We may be unsuccessful in integrating recent or future acquisitions into our existing operations or in realizing all or the anticipated benefits of such acquisitions. From time to time, we evaluate and seek to acquire assets and business that we believe complement our existing senior living communities and business.
From time to time, we evaluate and seek to acquire assets and business that we believe complement our existing senior living communities and business.
Historically, labor costs have comprised of approximately two-thirds of our total operating expenses. We experienced pressures associated with the intensely competitive labor environment during 2023, which continued throughout 2024. The United States’ unemployment rate remained at or below 4.2% each month during 2024 and 2023, and many states experienced record low unemployment rates.
We also will be dependent on the available labor pool of semi-skilled and unskilled employees in each of the markets in which we operate. Historically, labor costs have comprised of approximately two-thirds of our total operating expenses. We experienced pressures associated with the intensely competitive labor environment during 2023, which continued throughout 2024 and 2025.
Risks Related to Our Corporate Organization and Structure • Anti-takeover provisions in our governing documents, governing law, and material agreements may discourage, delay or prevent a merger or acquisition that our stockholders may consider favorable or prevent the removal of our current board of directors and management. • A substantial majority of the voting power of our issued and outstanding securities is held by a small group of stockholders. • The issuance of shares of our Series A Preferred Stock reduced the relative voting power of holders of our common stock, and the conversion of those shares into shares of our common stock would dilute the ownership of common stockholders and may adversely affect the market price of our common stock. • Our Series A Preferred Stock has rights, preferences, and privileges that are not held by, and are preferential to the rights of, holders of our common stock, which could adversely affect our liquidity and financial condition. • We are a holding company with no operations and rely on our operating subsidiaries to provide us with funds necessary to meet our financial obligations.
Risks Related to Our Corporate Organization and Structure • Anti-takeover provisions in our governing documents, governing law, and material agreements may discourage, delay or prevent a merger or acquisition that our stockholders may consider favorable or prevent the removal of our current board of directors and management. • A substantial amount of the voting power of our issued and outstanding securities is held by a small group of stockholders.
If problems are identified after closing of an acquisition, our agreements related to such acquisition may provide for limited recourse against the seller of the acquired properties or businesses. 18 Table of Contents Our investments in joint ventures could be adversely affected by our lack of exclusive control over these investments, our partners’ insolvency or failure to meet their obligations, and disputes between us and our partners.
Our investments in joint ventures could be adversely affected by our lack of exclusive control over these investments, our partners’ insolvency or failure to meet their obligations and disputes between us and our partners. We have entered into, and may continue in the future to enter into, partnerships or joint ventures with other persons or entities.
Several of our loan documents and other material agreements also require approval in the event we undergo a change of control of our Company. These provisions may have the effect of delaying or preventing a change of control of the Company even if this change of control would benefit our stockholders.
These provisions may have the effect of delaying or preventing a change of control of the Company even if this change of control would benefit our stockholders. In addition to the anti-takeover provisions described above, we are subject to Section 203 of the Delaware General Corporation Law.
Any newly issued equity securities may have rights, preferences, or privileges senior to those of our common stock. Risks Related to Our Business, Operations and Strategy We have incurred losses from operations in each of the last two fiscal years and may do so in the future. We incurred net losses in fiscal years 2024 and 2023.
Any newly issued equity securities may have rights, preferences, or privileges senior to those of our common stock.
Penalties for violations can range from civil money penalties for errors and negligent acts to criminal fines and imprisonment for knowing 25 Table of Contents and intentional misconduct. HIPAA is a complex set of regulations and many unanswered questions remain with respect to the manner in which HIPAA applies to businesses such as those operated by us.
HIPAA is a complex set of regulations and many unanswered questions remain with respect to the manner in which HIPAA applies to businesses such as those operated by us. In addition, some states have begun to enact more comprehensive privacy laws and regulations addressing consumer rights to data protection or transparency.
Labor pressures have resulted in higher-than-typical associate turnover and wage growth, and we have experienced difficulty in filling open line-level positions timely. To cover existing open positions, during 2023 and continuing into 2024, we needed to rely on more expensive premium labor, primarily contract labor and overtime.
The United States’ unemployment rate remained at or below 4.5% each month during 2025 and 2024, and many states experienced record low unemployment rates. Labor pressures have resulted in higher-than-typical associate turnover and wage growth, and we have experienced difficulty in filling open line-level positions timely.
We could encounter increased competition in the future that could limit our ability to attract residents and employees or expand our business. We rely upon the quality of our staff as a means to differentiate our services from other providers.
In light of labor shortages for medical and non-medical workers in many geographic areas, we may 25 Table of Contents increasingly compete to attract qualified and experienced employees. We could encounter increased competition in the future that could limit our ability to attract residents and employees or expand our business.
However, our insurance coverage may not sufficiently cover all types of losses or claims that may arise or be subject to exclusions. We have identified a material weakness in our internal controls over financial reporting as of December 31, 2024.
However, our insurance coverage may not sufficiently cover all types of losses or claims that may arise or be subject to exclusions. There is an inherent risk of liability in the provision of personal and health care services, not all of which may be covered by insurance.
A substantial majority of the voting power of our issued and outstanding securities is held by a small group of stockholders. In November 2021, we issued 41,250 shares of our Series A Preferred Stock to affiliates of Conversant Capital LLC.
Approximatel y 39 percent o f the voting power of our issued and outstanding securities is held by a small group of stockholders. As of the date hereof, affiliates of Conversant Capital LLC (the "Conversant Investors") and Silk Partners LP collectively owned approximately 39 percent of t he voting power of the Company’s issued and outstanding securities.
Removed
If we are unable to remediate this material weakness, we may not be able to accurately or timely report our financial condition or results of operations, which may adversely affect our financial statements and investor confidence in us and, as a result, the value of our common stock. • There is an inherent risk of liability in the provision of personal and health care services, not all of which may be covered by insurance. • Damage from catastrophic weather and other natural events, including climate change, could result in losses and adversely affect us and certain of our residents. • The geographic concentration of our communities could leave us vulnerable to an economic downturn, regulatory changes, acts of nature, including severe weather conditions or natural disasters, or the physical effects of climate change in those areas, which could negatively impact our financial condition, revenues, results of operations, and cash flow. • Because we do not presently have plans to pay dividends on our common stock, holders of our common stock must look solely to appreciation of our common stock to realize a gain on their investment. • We cannot predict the potential emergence and effects of a severe cold and flu season or a future pandemic, epidemic or outbreak of an infectious disease, on our operations, financial condition and liquidity. • Our approach to AI presents risks and challenges that can impact our business and could adversely affect our business.
Added
In addition, we incurred an additional $945.0 million of indebtedness to finance a portion of the CHP Merger, including $270.0 million under a bridge facility, increased borrowings under our senior secured revolving credit facility of an additional $150.0 million, and incurred $525.0 million in term loans upon the consummation of the CHP Merger.
Removed
Risk Factors Risks Related to Our Liquidity and Indebtedness We have significant debt and our failure to generate cash flow sufficient to cover required interest and principal payments could result in defaults of the related debt.
Added
Therefore, an event of default under the outstanding indebtedness, subject to cure provisions in certain instances, would give the respective lenders, the right to declare all amounts outstanding to be immediately due and payable, or foreclose on collateral securing the outstanding indebtedness.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWhen a cybersecurity incident occurs or we identify a vulnerability, we have a strategic partner (a Managed Security Service Provider (“MSSP”)) that is responsible for leading the initial 30 Table of Contents assessment of priority and severity.
Biggest changeWhen a cybersecurity incident occurs or we identify a vulnerability, we have a strategic partner (a Managed Security Service Provider) that is responsible for leading the initial assessment of priority and severity.
The Chief Technology Officer collaborates with operation vice presidents and department vice presidents to identify and analyze cybersecurity risks to us; considers industry trends; implements controls, as appropriate and feasible, to mitigate these risks; and enables business leaders to make risk-based business decisions that implicate cybersecurity considerations.
The Chief Technology Officer collaborates with operation presidents and department leaders to identify and analyze cybersecurity risks to us; considers industry trends; implements controls, as appropriate and feasible, to mitigate these risks; and enables business leaders to make risk-based business decisions that implicate cybersecurity considerations.
We also seek contractual commitments from key suppliers to appropriately secure and maintain their information technology systems and protect our information that is processed on their systems. • Third-party assessments of the Company: We have engaged third-party cybersecurity companies to periodically assess our cybersecurity posture and to assist in identifying and remediating risks from cybersecurity threats.
We also seek contractual commitments from key suppliers to appropriately secure and maintain their information technology systems and protect our information that is processed on their systems. 31 Table of Contents • Third-party assessments of the Company: We have engaged third-party cybersecurity companies to periodically assess our cybersecurity posture and to assist in identifying and remediating risks from cybersecurity threats.
Our Chief Technology Officer reports to our Chief Executive Officer and leads the Company’s overall cybersecurity function, including the assessment and management of cybersecurity risks. The Chief Technology Officer has over 25 years of experience in managing and leading information technology or cybersecurity teams and participates in various cybersecurity organizations.
Our Chief Technology Officer reports to our Chief Financial Officer and leads the Company’s overall cybersecurity function, including the assessment and management of cybersecurity risks. The Chief Technology Officer has over 30 years of experience in managing and leading information technology and cybersecurity teams and participates in various cybersecurity organizations.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeAs of December 31, 2024, we owned, managed, or invested in the senior housing communities referred to in Part I, Item 1 above under the caption “Operating Communities.”
Biggest changeAs of December 31, 2025, we owned, managed, or invested in the senior housing communities referred to in Part I, Item 1 above under the caption “Operating Communities.” With our recent CHP Merger, we acquired a national portfolio consisting of 69 high-quality senior housing communities that comprise a total of approximately 7,500 units and one vacant land parcel.
ITEM 2. PROPERTIES. Our executive and administrative offices are located at 14755 Preston Road, Suite 810, Dallas, Texas 75254, and consist of approximately 12,723 square feet. Our lease on the premises extends through April 30, 2028 with a three-year extension option.
ITEM 2. PROPERTIES. Our executive and administrative offices are located at 14755 Preston Road, Suite 810, Dallas, Texas 75254, and consist of approximately 12,723 square feet as of December 31, 2025. Our lease on the premises extends through April 30, 2028 with a three-year extension option.
Added
In February 2026, the Company added 4,400 square feet of additional lease space and amended its master lease to expire on October 31, 2031.
Added
The portfolio is geographically diversified with properties in 26 states.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeWhether or not covered by insurance, these claims, in the opinion of 31 Table of Contents management, and based on advice of legal counsel, should not have a material effect on our consolidated financial statements if determined adversely to us. ITEM 4. MINE SAFETY DISCLOSURES. Not applicable. 32 Table of Contents PART II
Biggest changeWhether or not covered by insurance, these claims, in the opinion of management, and based on advice of legal counsel, should not have a material effect on our consolidated financial statements if determined adversely to us. ITEM 4. MINE SAFETY DISCLOSURES. Not applicable. 32 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

7 edited+2 added−2 removed1 unchanged
Biggest changeOn January 14, 2016, the Company announced that its board of directors approved a continuation of the share repurchase program. The repurchase program does not obligate the Company to acquire any particular amount of common stock and the share repurchase authorization has no stated expiration date.
Biggest changeThe repurchase program does not obligate the Company to acquire any particular amount of common stock and the share repurchase authorization has no stated expiration date. All shares that have been acquired by the Company under this program were purchased in open-market transactions.
Period Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (2) Total at September 30, 2024 32,941 $ 104.10 32,941 $ 6,570,222 October 1 – October 31, 2024 — — — 6,570,222 November 1 – November 30, 2024 — — — 6,570,222 December 1 – December 31, 2024 — — — 6,570,222 Total at December 31, 2024 32,941 $ 104.10 32,941 $ 6,570,222 _______________________________________ (1) Does not include shares withheld to satisfy tax liabilities due upon the vesting of restricted stock, all of which have been reported in Form 4 filings relating to the Company.
Period Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (2) Total at September 30, 2025 32,941 $ 104.10 32,941 $ 6,570,222 October 1 – October 31, 2025 — — — 6,570,222 November 1 – November 30, 2025 — — — 6,570,222 December 1 – December 31, 2025 — — — 6,570,222 Total at December 31, 2025 32,941 $ 104.10 32,941 $ 6,570,222 _______________________________________ (1) Does not include shares withheld to satisfy tax liabilities due upon the vesting of restricted stock, all of which have been reported in Form 4 filings relating to the Company.
Securities Authorized for Issuance Under Equity Compensation Plans The following table presents information relating to the Company’s equity compensation plans as of December 31, 2024: Plan Category Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights Weighted-Average Exercise Price of the Outstanding Options, Warrants and Rights Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in First Column) Equity compensation plans approved by security holders — $ — 809,209 Equity compensation plans not approved by security holders — — — Total — $ — 809,209 (b) Recent Sales of Unregistered Securities; Use of Proceeds from Registered Securities.
Securities Authorized for Issuance Under Equity Compensation Plans The following table presents information relating to the Company’s equity compensation plans as of December 31, 2025: Plan Category Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights Weighted-Average Exercise Price of the Outstanding Options, Warrants and Rights Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in First Column) Equity compensation plans approved by security holders — $ — 797,512 Equity compensation plans not approved by security holders — — — Total — $ — 797,512 (b) Recent Sales of Unregistered Securities; Use of Proceeds from Registered Securities.
Market Information and Holders The Company’s shares of common stock are listed for trading on the New York Stock Exchange under the symbol “SNDA.” As of March 13, 2025 , there were 39 known registered stockholders of record of the Company’s common stock.
Market Information and Holders The Company’s shares of common stock are listed for trading on the New York Stock Exchange under the symbol “SNDA.” As of February 25, 2026 , there were 29 known registered stockholders of record of the Company’s common stock.
All shares that have been acquired by the Company under this program were purchased in open-market transactions. The Company may evaluate whether to acquire additional shares of common stock under this program at its discretion. ITEM 6. [RESERVED]. Not applicable.
The Company may evaluate whether to acquire additional shares of common stock under this program at its discretion. 33 Table of Contents ITEM 6. [RESERVED]. Not applicable.
(c) Purchases of Equity Securities by the Issuer and Affiliated Purchasers. The following information is provided pursuant to Item 703 of Regulation S-K. The information set forth in the table below reflects information regarding the aggregate shares repurchased by the Company pursuant to its share repurchase program (as described below) as of December 31, 2024.
The information set forth in the table below reflects information regarding the aggregate shares repurchased by the Company pursuant to its share repurchase program (as described below) as of December 31, 2025.
The average price paid per share for such share withholding is based on the closing price per share on the vesting date of the restricted stock or, if such date is not a trading day, the trading day immediately prior to such vesting date. 33 Table of Contents (2) On January 22, 2009, the Company’s board of directors approved a share repurchase program that authorized the Company to purchase up to $10.0 million of the Company’s common stock.
The average price paid per share for such share withholding is based on the closing price per share on the vesting date of the restricted stock or, if such date is not a trading day, the trading day immediately prior to such vesting date. The number of shares are a cumulative total.
Removed
No activity as of December 31, 2023. During the first quarter of 2024, we completed the 2024 Private Placement pursuant to which we issued and sold an aggregate of 5,026,318 Shares of our common stock to certain of our largest stockholders, including the Conversant Investors, at a price of $9.50 per share for gross proceeds of approximately $47.8 million.
Added
None, other than as previously disclosed by the Company in a quarterly report on Form 10-Q or a current report on Form 8-K. (c) Purchases of Equity Securities by the Issuer and Affiliated Purchasers. The following information is provided pursuant to Item 703 of Regulation S-K.
Removed
We used approximately $15.4 million of the proceeds from the 2024 Private Placement to fund the remaining cash portion of the purchase price for a buyback of certain of our mortgages. We used the remaining proceeds from the 2024 Private Placement for capital expenditure projects at our senior living communities, working capital, acquisitions and other general corporate purposes.
Added
(2) On January 22, 2009, the Company’s board of directors approved a share repurchase program that authorized the Company to purchase up to $10.0 million of the Company’s common stock. On January 14, 2016, the Company announced that its board of directors approved a continuation of the share repurchase program.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

65 edited+85 added−43 removed33 unchanged
Biggest changeInvesting activities The net cash used in investing activities for the year ended December 31, 2024 was $208.9 million primarily due to $172.5 million for acquisitions of new communities, $25.2 million due to o ngoing capital improvements and refurbishments , and $22.4 million in investments in unconsolidated entities, partially offset by a return on investment of $10.6 million in our unconsolidated entities in connection with its subsequent financing.
Biggest changeThe net cash used in investing activities for the year ended December 31, 2024 was primarily due to $172.5 million for acquisitions of new communities, ongoing capital improvements and refurbishments of $25.2 million, and $22.4 million in investments in unconsolidated entities, partially offset by a return on investment of $10.6 million in our unconsolidated entities in connection with its subsequent financing. 44 Table of Contents Financing activities The net cash provided by financing activities for the year ended December 31, 2025 of $37.5 million was primarily due to proceeds from our Revolving Credit Facility of $49.6 million and proceeds of $18.1 million from notes payable, partially offset by repayments of our Revolving Credit Facility of $14.5 million, repayments of notes payable of $8.4 million, dividends paid of $5.6 million, and deferred loan costs paid of $1.2 million.
During August 2024, the Company raised $124.1 million in total net proceeds from the Offering: an initial $110.4 million of proceeds on the sale of 4,300,000 shares and an additional $13.7 million on 530,317 shares, pursuant to the partial exercise of the underwriters’ 30-day option.
During August 2024, the Company raised $124.1 million in total net proceeds from the 2024 Offering: an initial $110.4 million of proceeds on the sale of 4,300,000 shares and an additional $13.7 million on 530,317 shares, pursuant to the partial exercise of the underwriters’ 30-day option.
The Company recorded $27.5 million in “Property and equipment, net” for tangible assets purchased; $5.6 million in “Intangible assets, net” for in-place leases; and $0.2 million in “Other liabilities” for below market leases in the Company’s condensed consolidated balance sheets.
The Company recorded $27.5 million in “Property and equipment, net” for tangible assets purchased; $5.6 million in “Intangible assets, net” for in-place leases; and $0.2 million in “Other liabilities” for below market leases in the Company’s consolidated balance sheets.
Overview The following discussion and analysis addresses (i) the Company’s results of operations on a historical consolidated basis for the years ended December 31, 2024 and 2023, and (ii) liquidity and capital resources of the Company, and should be read in conjunction with the Company’s historical consolidated financial statements and the selected financial data contained elsewhere in this Annual Report on Form 10-K.
Overview The following discussion and analysis addresses (i) the Company’s results of operations on a historical consolidated basis for the years ended December 31, 2025 and 2024, and (ii) liquidity and capital resources of the Company, and should be read in conjunction with the Company’s historical consolidated financial statements and the selected financial data contained elsewhere in this Annual Report on Form 10-K.
Historically, labor costs have comprised of approximately two-thirds of our total operating expenses. We began to experience pressures associated with the intensely competitive labor environment during 2022, which continued throughout 2023 and 2024. Labor pressures have resulted in higher-than-typical associate turnover and wage growth, and we have experienced difficulty in filling open positions timely.
Historically, labor costs have comprised of approximately two-thirds of our total operating expenses. We began to experience pressures associated with the intensely competitive labor environment during 2022, which continued throughout 2024 and 2025. Labor pressures have resulted in higher-than-typical associate turnover and wage growth, and we have experienced difficulty in filling open positions timely.
As a result, during inflationary periods, the Company may not be able to increase resident service fees to account fully for increased operating expenses. In structuring its fees, the Company attempts to anticipate inflation levels, but there can be no assurances that the Company will be able to anticipate fully or otherwise respond to any future inflationary pressures.
As a result, during inflationary periods, the Company may not be able to increase resident revenues to account fully for increased operating expenses. In structuring its fees, the Company attempts to anticipate inflation levels, but there can be no assurances that the Company will be able to anticipate fully or otherwise respond to any future inflationary pressures.
The 2024 Private Placement occurred in two tranches. The first tranche occurred on February 1, 2024, at which time 3,350,878 shares of common stock were issued and sold to the Investors for $31.8 million. The second tranche occurred on March 22, 2024, at which time 1,675,440 shares of common stock were issued and sold to the Investors for $15.9 million.
The 2024 Private Placement occurred in two tranches. The first tranche occurred in February 2024, at which time 3,350,878 shares of common stock were issued and sold to the Investors for $31.8 million. The second tranche occurred in March 2024, at which time 1,675,440 shares of common stock were issued and sold to the Investors for $15.9 million.
We cannot provide assurance that we would be able to pay the debts if they became due upon acceleration following an event of default. The Company was in compliance with all financial covenants of its outstanding indebtedness as of December 31, 2024.
We cannot provide assurance that we would be able to pay the debts if they became due upon acceleration following an event of default. The Company was in compliance with all financial covenants of its outstanding indebtedness as of December 31, 2025.
The Company recorded $89.2 million in “Property and equipment, net” for tangible assets purchased; $15.6 million in “Intangible assets, net” for in-place leases; and $0.4 million in “Other long-term liabilities” for below-market leases in the Company’s consolidated balance sheets.
The Company recorded $89.2 million in “Property and equipment, net” for tangible assets purchased; $15.6 million in “Intangible assets, net” for in-place leases; and $0.5 million in “Other long-term liabilities” for below-market leases in the Company’s consolidated balance sheets.
Continued increased competition for, or a shortage of, nurses and other employees and general inflationary pressures have required and may require that we enhance our pay and benefits package to compete effectively for such employees. ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. Not applicable. 43 Table of Contents ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
Continued increased competition for, or a shortage of, nurses and other employees and general inflationary pressures have required and may require that we enhance our pay and benefits package to compete effectively for such employees. ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. Not applicable. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
For 2025, we expect to continue to experience labor cost pressures as a result of the continuing labor conditions previously described and an anticipated increase in hours worked as our occupancy levels grow.
For 2026, we expect to continue to experience labor cost pressures as a result of the continuing labor conditions previously described and an anticipated increase in hours worked as our occupancy levels grow.
The 2024 Loan Purchase was funded by the concurrent expansion of the Company’s existing loan facility with Ally Bank (“Ally”) by $24.8 million (as described below) and the remainder was funded by proceeds from the 2024 Private Placement, as described below.
The 2024 Loan Purchase was funded by the concurrent expansion of the Company’s existing loan facility with Ally by $24.8 million and the remainder was funded by proceeds from the 2024 Private Placement, as described below.
During 2024, the Company sold an aggregate of 667,502 shares pursuant to the ATM Sales Agreement for net proceeds of $18.7 million, after applicable commissions. 2024 Private Placement Transaction On February 1, 2024, the Company entered into a securities purchase agreement (the “Securities Purchase Agreement”) with affiliates of Conversant Capital, LLC and several other shareholders (together, the “Investors”), pursuant to which the Investors agreed to purchase from the Company, and the Company agreed to sell to the Investors, in a private placement transaction (the “2024 Private Placement”), an aggregate of 5,026,318 shares of the Company’s common stock at a price of $9.50 per share.
During 2024, the Company sold an aggregate of 667,502 shares pursuant to the ATM Sales Agreement for net proceeds of $18.7 million, after applicable commissions and offering costs. 2024 Private Placement Transaction In February 2024, the Company entered into a securities purchase agreement with affiliates of Conversant Capital, LLC and several other shareholders (together, the “Investors”), pursuant to which the Investors agreed to purchase from the Company, and the Company agreed to sell to the Investors, in a private placement transaction (the “2024 Private Placement”), an aggregate of 5,026,318 shares of the Company’s common stock at a price of $9.50 per share.
There is judgement involved when determining the fair value of land and building values, including the selection of key assumptions in the valuation models based on estimated replacement costs, market rental rates, and capitalization rates, which are primarily unobservable inputs.
There is judgment involved when determining the fair value of land and building values, including the selection of key assumptions in the valuation models based on estimated replacement costs, market data, and capitalization rates, which are primarily unobservable inputs.
We mitigated a portion of the increase in food costs with the scale benefit of a higher number of residents, along with appropriate product substitution. For 2024 our non-labor operating expense on the same-store communities increased 2.4% as compared to the prior year. For 2025, we expect to continue to experience increases tied in to overall inflationary pacing.
We mitigated a portion of the increase in food costs with the scale benefit of a higher number of residents, along with appropriate product substitution. For 2025 our non-labor operating expense on the same-store communities increased 3.5% as compared to the prior year. For 2026, we expect to continue to experience increases tied in to overall inflationary pacing.
Liquidity and Capital Resources In addition to approximately $17.0 million of unrestricted cash balance as of December 31, 2024, our future liquidity will depend in part upon our operating performance, which will be affected by prevailing economic conditions, and financial, business and other factors, some of which are beyond our control.
Liquidity and Capital Resources In addition to approximately $11.0 million of unrestricted cash balance as of December 31, 2025, our future liquidity will depend in part upon our operating performance, which will be affected by prevailing economic conditions, and financial, 43 Table of Contents business and other factors, some of which are beyond our control.
The Credit Facility has a borrowing capacity of $150.0 million, a term of three years, a leverage-based pricing matrix between SOFR plus 2.10% margin and SOFR plus 2.60% margin and is fully recourse to Sonida Senior Living, Inc. and its applicable subsidiaries.
The Revolving Credit Facility had an initial borrowing capacity of $75.0 million, a term of three years, a leverage-based pricing matrix between SOFR plus 2.10% margin and SOFR plus 2.60% margin and is fully recourse to Sonida Senior Living, Inc. and its applicable subsidiaries.
Gain on extinguishment of debt for the year ended December 31, 2024 was $48.5 million related to the derecognition of notes payable and liabilities as a result of the 2024 Loan Purchase and the Texas DPO from two of our lenders.
Gain on extinguishment of debt for the year ended December 31, 2024 was $48.5 million related to the derecognition of notes payable and accrued liabilities as a result of a loan purchase and discounted loan payoff from two of its lenders.
Recent Investments Investment in Consolidated VIE On July 1, 2024, the Company entered into two joint ventures (collectively, the “Palatine JVs”) with affiliates of Palatine Capital Partners, which acquired four senior living communities located in Texas (3) and Georgia (1).
Investments Investment in Consolidated VIE In July 2024, the Company entered into two joint ventures with affiliates of Palatine Capital Partners (the “Palatine JVs”), which acquired four senior living communities located in Texas (3) and Georgia (1). The Company is a 51% owner of the Palatine JVs.
The carrying amount of the Company's investment in the Stone JV and maximum exposure to loss as a result of the Company's ownership interest in the Stone JV was $10.9 million, which is included in investment in unconsolidated entity on the accompanying condensed consolidated balance sheet as of December 31, 2024.
The carrying amount of the Company's investment in the Stone JV and maximum exposure to loss as a result of the Company's ownership interest in the Stone JV were $8.8 million and $10.9 million, respectively, as of December 31, 2025 and 2024, which is included in investment in unconsolidated entity on the accompanying consolidated balance sheets.
There were no impairments on long-lived assets during the year ended December 31, 2024. 39 Table of Contents New Accounting Pronouncements See “Note 2–Summary of Significant Accounting Policies” in the Notes to Consolidated Financial Statements for a discussion of new accounting pronouncements.
There were no impairments on long-lived assets during the year ended December 31, 2024. 40 Table of Contents New Accounting Pronouncements See “ Note 3 –Summary of Significant Accounting Policies ” in the Notes to Consolidated Financial Statements for a discussion of new accounting pronouncements.
Sonida operates the four communities for a management fee based on gross revenues of the applicable communities, as well as, in some cases, an incentive management fee based on earnings before interest, taxes, depreciation, amortization, rent, and management fees, and on other customary terms and conditions. The Company has evaluated its investment in the Stone JV under ASC 810.
Sonida operates the four communities for a management fee based on gross revenues of the applicable communities, as well as, in some cases, an incentive management fee based on earnings before interest, taxes, depreciation, amortization, rent, and management fees, and on other customary terms and conditions.
The Company managed 13 and ten communities on behalf of a third party during the years ended December 31, 2024 and 2023, respectively. The Company managed four communities on behalf of an unconsolidated joint venture and four communities of consolidated joint ventures during the year ending December 31, 2024 and none during the prior year period.
The Company managed 12 and 13 communities on behalf of a third party during the years ended December 31, 2025 and 2024, respectively. The Company managed four communities on behalf of an unconsolidated joint venture and four communities of consolidated joint ventures during the years ending December 31, 2025 and 2024.
Acquisitions of Senior Living Communities Upon the acquisition of new senior living communities, we recognize the assets acquired and the liabilities assumed as of the acquisition date, measured at their fair values using Level 3 inputs at the date of acquisition.
Acquisitions of Senior Living Communities Upon the acquisition of new senior living communities, we recognize the assets acquired and the liabilities assumed as of the acquisition date, measured at their relative fair values using Level 2 inputs at the date of acquisition including replacement costs and market data, as well as Level 3 inputs at the date of acquisition.
The Company is not required to make scheduled principal payments for the first 36 months. The Company also entered into a SOFR-based IRC to reduce exposure to the variable interest rate fluctuations associated with the new mortgage. The total cost of the IRC was $0.2 million and has an aggregate notional amount of $9.4 million.
The Company also entered into a SOFR-based IRC to reduce exposure to the variable interest rate fluctuations associated with the new mortgage. The total cost of the IRC was $0.2 million and has an aggregate notional amount of $9.4 million.
As of December 31, 2024, the Company owned, managed, or invested in 94 senior housing communities in 20 states with an aggregate capacity of approximately 10,000 residents, including 81 owned senior housing communities (including four owned through joint venture investments in consolidated entities, four owned through a joint venture investment in an unconsolidated entity, and one unoccupied) and 13 communities that the Company managed on behalf of a third party.
As of December 31, 2025, the Company owned, managed, or invested in 96 senior housing communities in 20 states with an aggregate capacity of approximately 10,150 residents, including 84 owned senior housing communities (inclusive of four owned through joint venture investments in consolidated entities and four owned through a joint venture investment in an unconsolidated entity) and 12 communities that the Company managed on behalf of a third party.
Macedonia Acquisition In April 2024, the Company entered into an asset purchase agreement to acquire a community located in Macedonia, Ohio for a purchase price of $10.7 million plus transaction costs of $0.4 million. In May 2024, the Company closed on the acquisition and entered into a mortgage loan totaling $9.4 million.
Macedonia Acquisition In May 2024, the Company acquired a community located in Macedonia, Ohio for a purchase price of $10.7 million plus transaction costs of $0.4 million. The Company entered into a mortgage loan totaling $9.4 million to fund the acquisition.
The Company recorded 34 Table of Contents $24.7 million in “Property and equipment, net” for tangible assets purchased; $4.8 million in “Intangible assets, net” for in-place leases; and $0.1 million in “Other long-term liabilities” for below-market leases in the Company’s consolidated balance sheets.
The asset acquisition was recorded at relative fair value. The Company recorded $24.7 million in “Property and equipment, net” for tangible assets purchased; $4.8 million in “Intangible assets, net” for in-place leases; and $0.1 million in “Other long-term liabilities” for below-market leases in the Company’s consolidated balance sheets.
The Omnibus Amendment amends the terms of each of the loan agreements (each, a “2024 Loan Agreement” and collectively, the “2024 Loan Agreements”) relating to 18 of the Company’s 37 senior living communities encumbered by mortgage agreements with Fannie Mae to, among other things, extend the maturity dates of each 2024 Loan Agreements from December 1, 2026 to January 1, 2029 in exchange for $10 million of scheduled principal paydowns on the 2024 Loan Agreements, which included a $2 million paydown made at closing and a series of $2 million, $3 million and $3 million due in November 2025, 2026 and 2027, respectively.
The Omnibus Amendment amended the terms of each of the loan agreements (each, a “2024 Loan Agreement” and collectively, the “2024 Loan Agreements”) relating to 18 of the Company’s 37 senior living communities encumbered by mortgage agreements with Fannie Mae to, among other things, extended the maturity dates of each 2024 Loan Agreement from December 1, 2026 to January 1, 2029 in exchange for $10 million of scheduled principal paydowns on the 2024 Loan Agreements.
Management Services The Company has property management agreements with third parties and its joint ventures pursuant to which the Company manages certain communities on their behalf for a management fee based on gross revenues of the applicable communities, as well as, in some cases, an incentive management fee and on other customary terms and conditions.
The Company used a portion of the proceeds from the first closing of the 2024 Private Placement to fund a portion of the cash purchase price for the 2024 Loan Purchase. 39 Table of Contents Management Services The Company has property management agreements with third parties and its joint ventures pursuant to which the Company manages certain communities on their behalf for a management fee based on gross revenues of the applicable communities, as well as, in some cases, an incentive management fee and on other customary terms and conditions.
The net cash used in investing activities for the year ended December 31, 2023 was primarily due to ongoing capital improvements and refurbishments at the Company’s senior housing communities of $17.9 million, partially offset by the proceeds from sale of assets of $1.4 million. 42 Table of Contents Financing activities The net cash provided by financing activities for the year ended December 31, 2024 of $232.0 million was primarily due to net proceeds from the issuance of common stock of $190.5 million, proceeds from our Credit Facility of $68.7 million, proceeds of $56.0 million from notes payable, and proceeds from noncontrolling investors of $7.8 million, partially offset by repayments of notes payable of $72.0 million, repayments of our Credit Facility of $8.7 million, deferred loan costs paid of $3.7 million, purchase of derivative assets of $3.3 million, and dividends paid of $2.8 million.
The net cash provided by financing activities for the year ended December 31, 2024 of $232.0 million was primarily due to net proceeds from the issuance of common stock of $190.5 million, proceeds from our Revolving Credit Facility of $68.7 million, proceeds of $56.0 million from notes payable, and proceeds from noncontrolling investors of $7.8 million, partially offset by repayments of notes payable of $72.0 million, repayments of our Revolving Credit Facility of $8.7 million, deferred loan costs paid of $3.7 million, purchase of derivative assets of $3.3 million, and dividends paid of $2.8 million.
The Company evaluates the realization of its investment in unconsolidated entities accounted for using the equity method if circumstances indicate the Company's investment is other than temporarily impaired. During the year ended December 31, 2024, there were no impairments.
The Company evaluates the realization of its investment in unconsolidated entities accounted for using the equity method if circumstances indicate the Company's investment is other than temporarily impaired.
Our non-labor operating expenses have historically comprised of approximately one-third of o ur total operating expenses and are subject to inflationary pressures. The United States consumer price index increased 2.9% during 2024, as compared to an increase of 3.4% in 2023, with food and energy prices increasing approximately 200 basis points.
Our non-labor operating expenses have historically comprised of approximately one-third of our total operating expenses and are subject to inflationary pressures. The United States consumer price index increased 2.8% during 2025, as compared to an increase of 2.9% in 2024.
For additional information regarding the Company’s recent financing transactions described above, see “ Note 8—Debt .” Public Offering In August 2024, the Company entered into an underwriting agreement providing for the offer and sale (the “Offering”) by the Company, and the purchase by the underwriters, of 4,300,000 shares of the Company’s common stock, at a price to the public of $27.00 per share.
Public Offering In August 2024, the Company entered into an underwriting agreement providing for the offer and sale (the “2024 Offering”) by the Company, and the purchase by the underwriters, of 4,300,000 shares of the Company’s common stock, at a price to the public of $27.00 per share.
In addition, one of the affiliates in the Palatine JVs entered into a SOFR-based IRC to reduce exposure to the variable interest rate fluctuations associated with one of the mortgages at a cost of $0.1 million.
The Company amended $13.5 million of the Palatine JV mortgage debt with one lender and extended the maturity to April 1, 2027. In addition, one of the affiliates in the Palatine JVs entered into a SOFR-based IRC to reduce exposure to the variable interest rate fluctuations associated with one of the mortgages at a cost of $0.1 million.
As of December 31, 2024, $21.7 million relating to this debt assumed through acquisitions, remained outstanding. These purchases are non-cash financing activities and therefore are not reflected within Capital expenditures in our consolidated statements of cash flows.
As of December 31, 2025, the mortgages have a weighted average interest rate of 6.6% and have terms ranging from 2026 through 2029. As of December 31, 2025, $21.7 million relating to this debt assumed through acquisitions, remained outstanding. These purchases are non-cash financing activities and therefore are not reflected within Capital expenditures in our consolidated statements of cash flows.
Sonida funded the transaction with $18.3 million of senior mortgage debt, including $2.0 million for capital expenditure investment into the facility, which is expected to be utilized to furnish and update the community prior to opening. The non-recourse mortgage has an 84-month term and 24-month interest waiver to support lease-up and stabilization, with a 3% fixed-interest-only rate thereafter.
Sonida funded the transaction with $18.3 million of senior mortgage debt, including $2.0 million for capital expenditure investment into the facility (the “Cincinnati Acquisition”). The non-recourse mortgage has an 84-month term and 24-month interest waiver to support lease-up and stabilization, with a 3% fixed-interest-only rate thereafter. The asset acquisition was recorded at relative fair value.
See “ Note 8–Debt ” and “ Note 14–Fair Value .” The asset acquisition was recorded at relative fair value. We recorded $10.0 million in “Property and equipment, net” for tangible assets purchased; $1.2 million in “Intangible assets, net” for in-place leases; and $0.1 million in “Other liabilities” for below-market leases for this acquisition in our consolidated balance sheet.
We recorded $10.0 million in “Property and equipment, net” for tangible assets purchased; $1.2 million in “Intangible assets, net” for in-place leases; and $0.1 million in “Other liabilities” for below-market leases for this acquisition in our consolidated balance sheets.
The Company repaid $8.7 million of the borrowing during the year ended December 31, 2024 and $60.0 million borrowings were outstanding as of December 31, 2024. 2024 Loan Purchase and Ally Term Loan Expansion We entered into an agreement with one of our previous lenders whereby the Company agreed to purchase the outstanding indebtedness it owed to such lender for a purchase price of $40.2 million (plus the reimbursement of certain amounts advanced to the Company by such lender).
The Texas DPO represents a discount of 36% on the total principal outstanding for which the Company recognized a gain on debt extinguishment of $10.4 million for the year ended December 31, 2024. 2024 Loan Purchase and Ally Loan Expansion During 2024, we entered into an agreement with one of our previous lenders whereby the Company agreed to purchase the outstanding indebtedness it owed to such lender for a purchase price of $40.2 million (plus the reimbursement of certain amounts advanced to the Company by such lender).
See “ Note 8 – Debt ” and “ Note 9 –S ec urities Financing ” in the Notes to Consolidated Financial Statements. The Company, from time to time, considers and evaluates financial and capital raising transactions related to its portfolio, including debt refinancings, purchases and sales of assets, equity offerings and other transactions.
The Company, from time to time, considers and evaluates financial and capital raising transactions related to its portfolio, including debt financings and refinancings, purchases and sales of assets, equity offerings and other transactions.
The borrowing base by which borrowing availability under the Credit Facility is determined is generally based upon the value of the senior living communities that secure the Company’s obligations under the Credit Facility.
The borrowing base by which borrowing availability under the Revolving Credit Facility is determined is generally based upon the value of the senior living communities that secure the Company’s obligations under the Revolving Credit Facility. In October 2024, the Company closed on an additional $75.0 million commitment under the Revolving Credit Facility.
During the year ended December 31, 2024, the Company borrowed $68.7 million under the Credit Facility, at a weighted average interest rate of 7.3%, which was secured by two of the Company’s previously unencumbered senior living communities and ten newly acquired communities.
During the year ended December 31, 2025, the Company borrowed $49.6 million under the Revolving Credit Facility, at a weighted average interest rate of 6.6%, which was secured by 14 of the Company's senior living communities.
Risk Factors.” In summary, the Company’s cash flows were as follows (in thousands): Years Ended December 31, 2024 2023 $ Change Net cash provided by (used in) operating activities $ (1,782) $ 10,683 $ (12,465) Net cash used in investing activities (208,923) (16,562) $ (192,361) Net cash provided by (used in) financing activities 232,042 (7,113) 239,155 Increase (decrease) in cash and cash equivalents $ 21,337 $ (12,992) $ 34,329 Operating activities Net cash used in operating activities for the year ended December 31, 2024 was $1.8 million as compared to net cash provided by operating activities of $10.7 million for the year ended December 31, 2023.
Risk Factors.” In summary, the Company’s cash flows were as follows (in thousands): Years Ended December 31, 2025 2024 $ Change Net cash provided by (used in) operating activities $ 24,364 $ (1,782) $ 26,146 Net cash used in investing activities (70,687) (208,923) $ 138,236 Net cash provided by financing activities 37,508 232,042 (194,534) Increase (decrease) in cash and cash equivalents $ (8,815) $ 21,337 $ (30,152) Operating activities Net cash provided by operating activities for the year ended December 31, 2025 was $24.4 million as compared to net cash used by operating activities of $1.8 million for the year ended December 31, 2024.
To cover existing open positions, during 2023 and continuing into 2024, we needed to rely on more expensive premium labor, primarily shift bonuses and overtime. The increase primarily resulted from merit and market wage rate adjustments, more hours worked with higher occupancy during 2024, and an increase in the use of premium labor, primarily shift bonuses and overtime.
The increase primarily resulted 47 Table of Contents from merit and market wage rate adjustments, more hours worked with higher occupancy during 2025, and an increase in the use of premium labor, consisting primarily of shift bonuses and overtime.
Recent Acquisitions Cincinnati Acquisition In December 2024, the Company closed on the acquisition of an unoccupied single senior living community located in Cincinnati, Ohio for a purchase price of $16.3 million.
The Company continues to actively market the community for sale, and no sale-related cash flows with respect to such community have been recognized as of December 31, 2025. 2024 Acquisitions Cincinnati Acquisition In December 2024, the Company closed on the acquisition of an unoccupied single senior living community located in Cincinnati, Ohio for a purchase price of $16.3 million.
Investment in Stone Unconsolidated Entity In April 2024, the Company and KZ Stone Investor LLC (“KZ Investor”) formed a new joint venture, Stone JV LLC (the “Stone JV”) for the purpose of acquiring, owning, and operating four senior housing communities located in the Midwest.
Investment in Stone Unconsolidated Entity In May 2024, the Company and an investor formed a joint venture, Stone JV LLC (the “Stone JV”), which purchased four senior housing communities located in the Midwest for a purchase price of $64.0 million through cash contributions.
In May 2024, the Stone JV purchased the four communities for a purchase price of $64.0 million. KZ Investor is the controlling managing member of the Stone JV and owns 67.29% of the entity as of December 31, 2024.
KZ Stone Investor LLC is the controlling managing member of the Stone JV and owns 67.29% of the entity as of December 31, 2025 and 2024. Sonida owns a 32.71% noncontrolling interest in the Stone JV as of December 31, 2025 and 2024.
On November 1, 2024, the Company paid $18.3 million for the Texas DPO which was financed with funds received from our Credit Facility. The Texas DPO represents a discount of 36% on the total principal outstanding for which the Company recognized a gain on debt extinguishment of $10.4 million for the year ended December 31, 2024.
On November 1, 2024, the Company paid $18.3 million for the Texas DPO which was financed with funds received from our Revolving Credit Facility.
Principal sources of liquidity are expected to be cash flows from operations, proceeds from our secured Credit Facility, proceeds from equity offerings, including sales of common stock under our ATM Sales Agreement, and proceeds from debt refinancings or loan modifications.
Principal sources of liquidity are expected to be cash flows from operations, proceeds from our A&R Credit Agreement, proceeds from debt financings, refinancings or loan modifications, and proceeds from equity offerings. These transactions are expected to provide additional financial flexibility to us and increase our liquidity position.
Recent Financing and Corporate Transactions 2024 and 2023 Fannie Mae Loan Modifications In December 2024, the Company and certain of its subsidiaries entered into an Omnibus Amendment to Multifamily Loan and Security Agreements (the “Omnibus Amendment”) with Federal National Mortgage Association (“Fannie Mae”).
The IRC has a 24-month term and caps SOFR at 6.00% from May 9, 2024 through May 1, 2026 with respect to such variable rate indebtedness. 2024 Fannie Mae Loan Modifications In December 2024, the Company and certain of its subsidiaries entered into an Omnibus Amendment to Multifamily Loan and Security Agreements (the “Omnibus Amendment”) with Federal National Mortgage Association (“Fannie Mae”).
The Company closed on the Palm Acquisition on October 1, 2024. Five of the Palm Communities are located in Florida and the other three Palm Communities are located in South Carolina. The asset acquisition was recorded at relative fair value.
Palm Acquisition In October 2024, the Company acquired eight senior living communities (collectively, the “Palm Communities”) for an aggregate cash purchase price of $102.9 million (such acquisition, the “Palm Acquisition”). Five of the Palm Communities are located in Florida and three are located in South Carolina. The asset acquisition was recorded at relative fair value.
See “Note 8–Debt” and “Note 9–Securities Financing” in the Notes to Consolidated Financial Statements. Debt Covenants Certain of our debt agreements contain restrictions and financial covenants, such as those requiring us to maintain prescribed minimum debt service coverage ratios, in each case on a multi-community basis.
(2) Transaction, transition and restructuring costs relate to legal and professional fees incurred for transactions, restructuring projects, or related projects, primarily related to the CHP transaction during 2025. Debt Covenants Certain of our debt agreements contain restrictions and financial covenants, such as those requiring us to maintain prescribed minimum debt service coverage ratios, in each case on a multi-community basis.
The asset acquisition was recorded at relative fair value. The Company recorded $16.4 million in “Property and equipment, net” for tangible assets purchased in the Company’s consolidated balance sheets. Atlanta Acquisition In October 2024, the Company entered into a purchase and sale agreement (“Atlanta PSA”) to acquire 2 senior living communities in the Atlanta, Georgia market for $29.0 million.
The Company recorded $16.4 million in “Property and equipment, net” for tangible assets purchased in the Company’s consolidated balance sheets. As of December 31, 2025, the community was occupied. 35 Table of Contents Atlanta Acquisition In November 2024, the Company acquired two senior living communities in the Atlanta, Georgia market for $29.0 million.
The Company recognized a non-cash impairment charge of $6.0 million to its “Property and equipment, net” during the year ended December 31, 2023, which related to one owned community.
The Company recognized a non-cash impairment charge of $12.5 million to its “Property and equipment, net” during the year ended December 31, 2025 which related to four owned communities. Due to recurring net operating losses, the Company concluded the assets related to three of the communities had indicators of impairment and the carrying value was not recoverable.
During the year ended December 31, 2023, the Company recorded a non-cash impairment charge of $6.0 million related to one owned community with decreased cash flow estimates as a result of recurring net operating losses.
During the year ended December 31, 2025, the Company recorded non-cash impairment charges of $12.5 million to property and equipment, net, of which $4.7 million was to adjust the carrying value of a community classified as held for sale to its fair value, net of estimated disposal costs, and $7.8 million was related to three owned communities with decreased cash flow estimates as a result of recurring net operating losses.
The change of $12.5 million is primarily due to the settlement of accounts payable and accrued expenses during the year ended December 31, 2024 compared to the prior year. Additionally, we received grants of $2.9 million in the year ended December 31, 2023 from state departments due to financial distress impacts of the coronavirus.
The change of $26.1 million is primarily due to the timing of collections of accounts receivable and settlement of accounts payable and accrued expenses during the year ended December 31, 2025 compared to the prior year.
Senior Secured Revolving Credit Facility In July 2024, the Company entered into a credit agreement for a senior secured revolving credit facility (the “Credit Facility”).
During the year ended December 31, 2025 and 2024, there were no impairments. 36 Table of Contents Recent Financing Senior Secured Revolving Credit Facility In July 2024, the Company entered into a credit agreement for a senior secured revolving credit facility (the “Revolving Credit Facility”).
The 2024 Loan Purchase and Ally Term Loan expansion reduced notes payable by $49.6 million and resulted in a gain on debt extinguishment totaling $38.1 million. 2024 and 2023 Ally Loan Amendments In May 2024, the Company executed an amendment (“Ally Fourth Amendment”) to the Ally term loan agreement (“Ally Term Loan”).
The 2024 Loan Purchase and Ally Term Loan expansion reduced notes payable by $49.6 million and resulted in a gain on debt extinguishment totaling $38.1 million for the year ended December 31, 2024. The Company incurred deferred loan costs of $0.5 million as part of the Ally financing which are being amortized over the loan term.
Notes Payable - Consolidated VIE In connection with the purchase of the Palatine JVs in July 2024, the Palatine JV assumed $21.7 million of mortgage debt with several lenders. The mortgages have a weighted average interest rate of 7.2% and have terms ranging from 2025 through 2029.
The expanded Ally debt facility was secured by six of the Company’s senior living communities involved in the 2024 Loan Purchase. 38 Table of Contents Notes Payable - Consolidated VIE In connection with the purchase of the Palatine JVs in July 2024, the Palatine JV assumed $21.7 million of mortgage debt with several lenders.
General and administrative expenses for the year ended December 31, 2024 were $40.0 million as compared to $32.2 million for year ended December 31, 2023, an increase of $7.8 million, or 24.2%.
General and administrative expense for the year ended December 31, 2025 increased as compared to the year ended December 31, 2024, primarily due to a result of an increase in labor and employee related expenses to support the Company's 2025 and 2024 acquisitions.
Results of Operations The following table includes our Consolidated Statements of Operations data in thousands of dollars and expressed as a percentage of total revenues for the years ended December 31, 2024 and 2023.
The following table summarizes our consolidated data for the years ended December 31, 2025 and 2024, including operating results and data on a same-store community portfolio basis.
The increase in revenue was primarily due to increased occupancy, increased average rent rates, and additional communities acquired in 2024. 38 Table of Contents Weighted average occupancy for the year ended December 31, 2024 for the communities owned by the Company excluding 2024 acquisitions was 86.4% as compared to a weighted average occupancy for the year ended December 31, 2023 of 84.6%, reflecting continued occupancy growth.
Depreciation increased for the year ended December 31, 2025 as compared to the year ended December 31, 2024, primarily due to the additional communities acquired in 2024 and 2025, and an increase in capital expenditures.
The net cash used in financing activities for the year ended December 31, 2023 of $7.1 million was primarily due to repayments of notes payable of $13.8 million, purchase of derivative assets of $2.4 million, and deferred financing costs paid of $0.8 million, partially offset by proceeds of $10.0 million from equity draws under the equity commitment.
Investing activities The net cash used in investing activities for the year ended December 31, 2025 was $70.7 million primarily due to $38.2 million for acquisitions of new communities and $33.3 million due to o ngoing capital improvements and refurbishments , partially offset by a return of investment of $0.8 million in our unconsolidated entity.
The increase is primarily attributable to the increase in labor costs of $15.7 million and an increase in other variable operating expenses of $5.3 million as a result of increased occupancy in the Company's same store communities and 16 new consolidated communities (including one unoccupied community acquired on December 31, 2024) as compared to the prior year.
The increase in community operating expense was primarily attributable to an increase in operating expenses related to the 19 additional communities acquired during 2025 and 2024, and a 5.3% increase in same-store community operating expense primarily resulting from increases in labor, service contracts, utilities and other expense.
On November 1, 2024, the Company closed on the acquisition of these 2 senior living communities. The asset acquisition was recorded at relative fair value.
See “ Note 9 –Debt ” and “ Note 1 5 –Fair Value .” The asset acquisition was recorded at relative fair value.
Removed
Palm Acquisition In August 2024, the Company entered into eight asset purchase agreements (the “Palm PSAs”) with various affiliates of Principal Senior Living Group, pursuant to which the Company acquired eight senior living communities (collectively, the “Palm Communities”) for an aggregate cash purchase price of $102.9 million (such acquisition, the “Palm Acquisition”).
Added
Strategic Merger with CHP On March 11, 2026, the Company completed the previously announced acquisition of CHP, a public non-traded real estate investment trust which owns a national portfolio of 69 high-quality senior housing communities, pursuant to the Merger Agreement.
Removed
The Palatine JVs acquired these communities for a purchase price of $32.8 million plus transaction costs of $0.1 million for net cash of $11.2 million and financing of $21.7 million of senior mortgage debt. The Company is a 51% owner in the Palatine JVs. The Company has evaluated its investment in the Palatine JVs under ASC 810.
Added
Under the terms of the Merger Agreement, the Company acquired 100% of the outstanding common stock of CHP in a stock and cash transaction valued at approximately $1.8 billion, with approximately 68% of the consideration paid in the form of newly issued Sonida common stock and 32% paid in cash.
Removed
The Company has determined that it has the power to direct the activities of the VIE that most significantly impact its economic performance and is the primary beneficiary of the VIE in accordance with ASC 810. Accordingly, the Company has consolidated the activity of the Palatine JVs into its condensed consolidated financial statements for the period ended December 31, 2024.
Added
Specifically, each share of CHP common stock was converted into $2.32 in cash and 0.1318 shares of Sonida common stock, which was determined by dividing (a) $4.58 by (b) the volume weighted average price (“VWAP”) of Sonida common stock during a measurement period prior to closing of the transaction and subject to a collar of 15% below the transaction reference price for the Sonida common stock of $26.74 (the “Transaction Reference Price”) and 30% above the Transaction Reference Price.
Removed
The Company manages the 4 Palatine JV communities in exchange for a management fee calculated as a percentage of gross revenue and an additional incentive management fee based on earnings before interest, taxes, depreciation, amortization, rent, and management fees, and on other customary terms and conditions. The asset acquisition was recorded at fair value.
Added
Since the VWAP during the measurement period was $35.93, the 0.1318 exchange ratio was calculated by dividing $4.58 by $34.76, being the high end of the collar.
Removed
Sonida owns a 32.71% noncontrolling interest in the Stone JV as of December 31, 2024, which was acquired through cash contributions in connection with the closing.
Added
In order to fund a portion of the cash consideration required for the CHP Merger, entities affiliated with Conversant Capital, LLC and Silk Partners LP, two of the Company’s largest shareholders, funded an aggregate amount of $110.0 million in exchange for the issuance of 4,113,688 of Sonida common stock in a private placement pursuant to Section 4(a)(2) of the Securities Act at a price per share equal to $26.74, in accordance with certain investment agreements.
Removed
The Company has determined that it does not have the power to direct the activities of the VIE that most significantly impact its economic performance and is not the 35 Table of Contents primary beneficiary of the VIE in accordance with ASC 810. The Company's interests in the VIE are, therefore, accounted for under the equity method of accounting.
Added
The remainder of the cash consideration was funded with cash from the balance sheets of the Company and CHP along with debt financing as described under “ —Recent Financing—Senior Secured Credit Facility” and “—Recent Financing—Bridge Loan Agreement.” See Part I, Item 1 and “ Note 2–CHP Merger ” in the Notes to Consolidated Financial Statements for additional information. 34 Table of Contents Unless otherwise specifically noted, the historical financial information included herein does not reflect the closing of the CHP Merger, which occurred subsequent to December 31, 2025.
Removed
New Management Agreements The Company has property management agreements with a third-party owner pursuant to which the Company manages certain communities on their behalf for a management fee based on gross revenues of the applicable communities, as well as an incentive management fee, and other customary terms and conditions.
Added
The post-Merger results of CHP will first be included in our consolidated financial information for the period ending March 31, 2026. We expect our 2026 results of operations to be materially impacted by the CHP Merger as a result of acquiring 69 senior housing communities.
Removed
During June 2024 the Company executed management agreements to assume the management of two communities owned by a third party. During August 2024 the Company executed management agreements to assume the management of one community owned by a third party.

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