The Refinancing of both tax-exempt and taxable debt gives the American Association of Homes and Services for the Aging enhanced cash flow and more flexible covenants to support future financing needs.

New York, NY (September 19, 2005) – Herbert J. Sims & Co., Inc. (Sims) announced today that it recently closed a $16.155 million refinancing for the American Association of Homes and Services for the Aging (AAHSA), the national organization of non-profit providers of housing and services for seniors.

Sims is an investment bank focused on providing financing for the senior living industry

Proceeds are being used to refinance AAHSA’s outstanding 1999 tax-exempt bonds, issued through the District of Columbia, and its outstanding 1999 taxable promissory note, both of which were initially issued to finance the construction of AAHSA’s national headquarters building in Washington, D.C.

The entire refinancing was secured by letters of credit from Sovereign Bank to enhance the tax-exempt and taxable series of variable rate bonds issued in 1999. Both series of variable rate bonds were swapped to a fixed rate for seven years.

AAHSA’s more than 5,300 member organizations provide a variety of senior services, including: continuing care retirement communities; nursing homes; assisted living facilities; independent housing projects, and home-and-community based service organizations.

benefits to aahsa

The refinancing secures two key AAHSA objectives: (1) generating annual cash flow savings, and (2) providing flexible covenants to support AAHSA’s diverse operational needs and unique business cycle. The refinancing will accomplish both of these objectives by generating more than $315,000 in average annual savings during the initial five-year term of the letter of credit, along with low debt service coverage and liquidity requirements-- and by allowing for additional indebtedness to upgrade AAHSA’s IT infrastructure. In addition, the refinancing releases to AAHSA approximately $650,000 in reserves required under the 1999 financings.

Said John Minehan, Senior Vice President of Sims, “Sims is committed to the senior housing industry – and to making financing for non-profit and for-profit communities more flexible, lower-cost and more accessible. Accordingly, we are delighted to be able to help AAHSA, the main organization for non-profit senior living communities.”

Larry Minnix, AAHSA’s President & CEO noted, “Herbert J Sims has specialized in serving the financing needs of the not-for-profit long term care field for two generations. As AAHSA evaluated how we can deliver value to our members by using dues and other support dollars that our members give to help them serve the elderly, Sims stepped forward to evaluate our original financing and offer cost beneficial alternatives that reinforce AAHSA’s financial health and provide for future flexibility in a rapidly changing aging services environment. We could not be more pleased with the outcome.”