HB 719 — Continuing Care Retirement Communities Act.

A statement itemizing all estimated project costs, includingincludingthe the real property costs, the cost of designing and constructing the proposed expansion, and all similar costs that the applicant expects to incur prior to the opening of the expansion.

An economic analysis of current market conditions and trends that can impact the feasibility of the proposed expansion, positively or negatively, including real estate, income, employment,andthegeneralemployment,andthe general economicoutlookfortheprimary market area and surrounding areas.

Page 18 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 2.

DRH40232-NE-98AHouse Bill 719-First Edition Page 19 General Assembly Of North Carolina Session 2025 (2) None of the grounds for denial listed in G.S.

Demonstrates that the expansion is financiallyfinanciallyviable viable and will not have an unreasonably adverse effect on the financial abilityabilityof of the applicant to furnish continuing care.

(4) The applicant demonstrates the abilityabilityto to provide continuing care and meet all financial and contractual obligations related to its operations, including the financial requirements of this Article.

(6) The actuarial study, if applicable, projects that the continuing care retirement communitycommunitywill will be in satisfactorysatisfactoryactuarial actuarial balance within a reasonable period of time once stabilized occupancy of the expansion is achieved, or if no actuarial study is required, the actuarial projection of future population flows demonstrates a sufficient number of adult care home beds and nursing beds to meet the needs of residents and the contractual obligations of the applicant.

(e) AftertheCommissionerapprovestheexpansionAftertheCommissionerapprovestheexpansionapplication,theprovidershallsubmit application,theprovidershallsubmit periodic sales and development reports to the Commissioner in a form prescribed by the Commissioner to monitor the expansion project.

Allentrancefees anddepositscollectedforindependentlivingunitsinanexpansionrequiringanddepositscollectedforindependentlivingunitsin anexpansionrequiring Commissioner approval under this Part shall be placed in an escrow account in accordance with Part 4 of this Article unless otherwise exempted by the Commissioner.

Page 20 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 (1) A provision requiring that all funds received shall be placed into the escrow account in accordance with G.S.

(b) AnyAnydeposit depositdeliveryto delivery to an escrow agent pursuant to this Article shall be accompanied with a copy of the executed nonbinding reservation agreement, binding reservation agreement, or continuing care contract, a copycopyof of the receipt given to the depositor, a summarysummaryof of all deposits made on that date, and any other materials required by the escrow agent.

DRH40232-NE-98AHouse Bill 719-First Edition Page 21 General Assembly Of North Carolina Session 2025 "§ 58-64A-125.

Anyindependent livinglivingunit unit forwhicharefundis pendingpendingshall shall not becounted toward the fifty percent (50%) requirement.

Page 22 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 (3) For a proposed continuing care retirement community, the aggregate entrance fees received or receivable by the provider pursuant to binding reservation agreements and continuingcontinuingcare care contracts, plus theanticipatedtheanticipatedproceeds proceeds of any first mortgage loan or other long-term financing commitment, plus any equity being contributed by the provider or a related party, are equal to not less than ninety percent (90%) of the following amount:

(1) The provider has presold at least seventy percent (70%) of the proposed independent living units, having received a minimum ten percent (10%) deposit of each applicable entrance fee and maintains at least seventy-five percent (75%) of each entrance fee or deposit received in escrow, or has maintainedanindependentlivingunitoccupancymaintainedanindependentlivingunitoccupancyminimumofseventypercent minimumofseventypercent (70%) for at least 60 days.

(3) Theindependent livinglivingunits unitsareavailableforoccupancybythenewresidents. areavailableforoccupancy by thenewresidents.

(c) The Commissioner shall instruct the escrow agent in writing to release to the provider entrance fees and deposits in the escrow account onlyonlywhen when the Commissioner has confirmed the information provided by the provider pursuant to subsection (a) or subsection (b) of this section.

DRH40232-NE-98AHouse Bill 719-First Edition Page 23 General Assembly Of North Carolina Session 2025 (2) Average daily cash operating expenses.

(8) OperatingOperatingratio. ratio.

The quotient shall be calculated bybydividing dividing unrestricted cash and investments bybytotal total long-term debt, less the current portion of long-term debt.

(a) A provider shall prepare a disclosure statement for each continuing care retirement communitycommunityoperated operated or to be operated in this State that includes all of the following information:

Page 24 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 (1) The name, business address, and telephone number of the provider and a statement of whether the provider is a partnership, corporation, or other type of legal entity.

(6) Thename,business address,education,workexperience,andlengthofservice with the provider or the provider's controlling person of (i) all officers, directors, trustees, managers, managing or general partners of the provider and, if applicable, the provider's controlling person, and any person having a ten percent (10%) or greater equity or beneficial interest in the provider or the provider's controlling person and (ii) any person who will be managing the continuingcareretirementcommunityonaday-to-daybasis,andadescriptioncontinuingcareretirementcommunityonaday-to-daybasis, andadescription of the person's interest in or occupation with the provider or controlling person.

A description of any matter in which the person (i) has been convicted of any felony or pleaded nolo contendere to a felony charge, (ii) has been held liable or enjoined in a civil action by final judgment involving fraud, embezzlement, fraudulent conversion, or DRH40232-NE-98AHouse Bill 719-First Edition Page 25 General Assembly Of North Carolina Session 2025 misappropriation of property, or (iii) is subject to a currently effective injunctive or restrictive court order, or within the past five years, had any state or federal license or permit suspended or revoked as a result of an action brought by a governmental agency or department.

(10) A statement indicating whether the provider has a relationship with any religious, charitable,orotherorganizationorperson,alongcharitable,orotherorganizationorperson,alongwith with thenatureand extent of that relationship.

(14) A statement indicating whether the provider currentlycurrentlyemploys employs or will employ a third-partythird-partymanager manager for the continuing care retirement communitycommunityand, and, if so, the name of the third-party manager employed and their experience in providing management services within the continuing care retirement community industry.

Page 26 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 (19) If the provider is licensed to provide continuing care at home, a description of the continuing care at home program, including the primary market area served.

(21) The 12-month daily average occupancy rate at the continuing care retirement community, bybyliving living unit type, as of the provider's fiscal year-end for the past five years or for each year of the continuing care retirement community's operation if it has been in operation for less than five years.

(25) A description of all nonancillarynonancillaryfees fees required of residents, including entrance fees, periodic fees, transfer fees, and resale fees, if any.

If the continuing care retirement communitycommunityis is not yet in operation, the provider shall include a table showing the expected frequency, average percent increase, and average dollar amount of each increase in periodic fees utilized in the five-year prospective financial statements required pursuant to subdivision (37) of this subsection.

If the continuing care retirement communitycommunityis isHouse DRH40232-NE-98ABill 719-First Edition Page 27 General Assembly Of North Carolina Session 2025 not yet in operation, the provider shall include a table showing the expected frequency, average percent increase, and average dollar amount of each increase in entrance fees utilized in the five-year prospective financial statements required pursuant to subdivision (37) of this subsection.

Will be due to residents who have permanently vacated their independent living unit and now reside in a non-independent living unit provided bybythe the provider whose former independent living unit has already been resold.

(29) The conditions under which a living unit occupied by a resident may be made available bybythe the provider to a different or new resident other than on the death of the prior resident.

58-64A-245, to provide reserve funding or securitysecurityto to enable the provider to refund entrance fees and deposits when due and to fulfill all of its other obligations under binding reservation agreements, continuing care contracts, and continuing care at home contracts, Page 28 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 including the establishment of escrow accounts, trusts, or reserve funds, together with the manner in which these funds will be invested, and the names and experience of any person or persons who will make the investment decisions.

Details of anyanyleasingagreements leasing agreements where the provider is leasing from another person any part of the real property of the continuing care retirement community, including the length of the lease and the remaining term.

DRH40232-NE-98AHouse Bill 719-First Edition Page 29 General Assembly Of North Carolina Session 2025 3.

(38) A narrative describing the reasons for anyanymaterial material differences between (i) the five-year prospective financial statements included as a part of the disclosure statement recorded most immediately subsequent to the start of the provider's most recently completed fiscal year and (ii) the actual results of operations of the provider's most recently completed fiscal year.

(39) A table detailing the following key financial metrics for the past three fiscal years, including the most recent fiscal year, or for each year the provider has beeninoperationiftheproviderhasbeeninoperationforlessthanthreeyears,beeninoperationiftheproviderhasbeeninoperationforlessthanthree years, plus the next three fiscal years, based on the provider's current and prior annual audited financial statements andcurrent five-yearprospectivefinancial statements.

(40) If the provider has had an actuarial studystudyprepared prepared within the prior three years, a statement of actuarial opinion which includes a description of the key Page 30 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 assumptions used to prepare the actuarial study and an opinion on satisfactory actuarial balance.

(41) A summarysummaryof of the last examination report issued bybythe the Commissioner, if any, with references to the page numbers of the examination report noting any deficiencies foundbythe Commissioner,andtheactions takenbytheprovidertaken bytheprovider to rectify those deficiencies, indicating in the summary where the full examination report may be inspected at the continuing care retirement community.

(4) That the disclosure statement has not been reviewed or approved by any government agencyorrepresentativeto ensure accuracyaccuracyoftheinformationset oftheinformationset out.

(d) The date on the cover page of the disclosure statement shall coincide with the last day oftheprovider's fiscal yearcoveredbytheinformationcontainedwithin thedisclosurestatement.the disclosurestatement.

DRH40232-NE-98AHouse Bill 719-First Edition Page 31 General Assembly Of North Carolina Session 2025 (a) A provider shall deliver a current disclosure statement meeting the requirements of G.S.

The annual disclosurestatement revision shall beaccompanied bybyanannual anannual filing fee of two thousand dollars ($2,000).

After receivingreceivingthe the Commissioner's notice, the provider shall make the annual revised disclosure statement available to all residents and depositors either in electronic or paper form.

Page 32 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 (d) If the annual disclosure statement revision is not received by the due date and no extension has been granted, a one thousand dollar ($1,000) late fee shall accompany submission of the annual disclosure statement revision.

(a) A provider may revise its disclosure statement at any time if, in the opinion of the provider, revision is necessary to prevent an otherwise current disclosure statement from containing amaterial misstatement offactof oromitting amaterial fact requiredoromittingamaterialfact torequiredto bestatedtherein.bestated therein.

(3) A provision that, if an agreement is rescinded, automatically canceled, or otherwise canceled bybythe the depositor, the depositor shall receive a refund of all money or other consideration transferred to the provider.

DRH40232-NE-98AHouse Bill 719-First Edition Page 33 General Assembly Of North Carolina Session 2025 (4) Aprovision thatanyrefundduetothatanyrefunddue to adepositorfora cancellationortermination for reasons not provided for in this section shall be computed in accordance with the terms of the agreement.

Page 34 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 (10) Any requirement that the resident maintain long-term care insurance or apply for Medicaid benefits or any other public assistance program.

(2) AdraftamendeddisclosurestatementcontainingAdraftamendeddisclosurestatementcontaininga adescriptionoftheproposeddescriptionoftheproposed continuing care at home program, including the primary market area to be served, the types of services to be provided, and the fees to be charged.

Providers who do not collect entrance fees or some other type of up-front prepayment of costs are exempt from this requirement and shall only be required to submit an actuarial projection of future population flows and adult care home bed and nursingnursingbed bed needs using appropriate mortality, morbidity, withdrawal, occupancy, and other demographic assumptions, and using a projection period that extends to a point at which, in the actuary's professional judgment, the use of a longer period would not materially affect the results and conclusions.

(5) A market studystudyprepared preparedbya by a person experienced in the preparation of market studies for continuing care at home or similar programs that demonstrates sufficient interest in a continuing care at home program.

DRH40232-NE-98AHouse Bill 719-First Edition Page 35 General Assembly Of North Carolina Session 2025 (b) The Commissioner shall comply with the review schedule in G.S.

(2) A provision that, if a resident dies prior to the effective start date of services, orif,on account ofillness,injury,orincapacity,a resident wouldbeprecluded from meeting the eligibilityeligibilityterms terms of the contract, the contract is automatically canceled.

Page 36 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 (8) The process that will be followed to establish priority if a resident wishes to exercise the resident's right to move into an independent living unit at a continuing care retirement community operated by the provider.

(a) All providers shall have an annual audit bybyan an independent certified public accountant and shall file audited financial statements with the Commissioner within 150 days following the end of each fiscal year.

(b) Extensions of the filing date may be granted by the Commissioner for 30-day periods upon a showing bybythe the provider and its independent certified public accountant of the reasons for requesting an extension and determination by the Commissioner of good cause for an extension.

(a) The annual audited financial statements shall report the financial position of the provider as of the end of the most recent fiscal year and the results of its operations, cash flows, and changes in equityequityor or net assets for the year then ended.

The audited financial statements shall be comparative, presenting the amounts as of the end of the most current year-end and the amounts as of the immediatelyimmediatelypreceding preceding year-end.

DRH40232-NE-98AHouse Bill 719-First Edition Page 37 General Assembly Of North Carolina Session 2025 (5) Statement of changes in net assets or equity.

(1) Quarterly unaudited financial statements of the provider and any obligated group of which the provider is a member, which shall include a balance sheet, a statement of operations, and a statement of cash flows, which shall contain Page 38 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 the same categories and line items as the annual audited financial statements filed with the Commissioner pursuant to G.S.

Providers exempt pursuant to this subsection shall submit to the Commissioner, at least once every five years, an actuarial projection of future population flows and adult care home bed and nursing bed needs using appropriate mortality, morbidity, withdrawal, occupancy, and other demographic assumptions and using a projection period that extends to a point at which, in the actuary's professional judgment, the use of a longer period would not materiallymateriallyaffect affect the results and conclusions.

DRH40232-NE-98AHouse Bill 719-First Edition Page 39 General Assembly Of North Carolina Session 2025 If the Commissioner determines that additional information is needed to properlyproperlymonitor monitor the financial condition or operations of a provider or continuing care retirement community or is otherwise needed to protect the interests of residents and the general public, the Commissioner may require a provider licensed under this Article to file any of the following:

A provider shall notifynotifythe the Commissioner and all residents in writing within 10 business days whenever any of the following apply:

(6) Any proceeding for denial, suspension, or revocation of any license or permit needed to operate all or part of a continuing care retirement communitycommunityin in this State.

(d) For the purposes of this section, material changes or deviations mean any change or extraordinary occurrence which creates or causes, or could create or cause, an applicant or Page 40 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 provider to be in a hazardous condition or, for a proposed continuing care retirement community or proposed expansion of a continuing care retirement community, to no longer be financially viable.

(b) A provider or any other person who owns the real property used in the operations of a continuing care retirement community shall obtain approval from the Commissioner before consummating any sale or transfer of any real property used in the operations of a continuing care retirement community, including a sale-leaseback transaction, or anyanyinterest interest in a continuing care retirement community, other than the sale of an independent living unit to a resident or other transferee.

DRH40232-NE-98AHouse Bill 719-First Edition Page 41 General Assembly Of North Carolina Session 2025 (b) The request for approval required by this section shall be in a form prescribed by the Commissioner, made under oath or affirmation, and shall contain all of the following information:

If the person is not an individual, a report of the nature of its business operations duringthe past fiveyearsorforfive yearsorfor alesser periodas the person and any predecessors have been in existence.

(7) A description of anyanyagreements agreements made or to be made with residents which will amend any continuing care or continuing care at home contract at the time of the transfer of control.

Page 42 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 (3) Afterthe change ofcontrol, theproviderwill beableto satisfythe certification or licensure requirements, as applicable, of this Article.

(5) AnyAnyplans plans or proposals that anyanyacquiringperson acquiring person has to liquidate the provider, or any continuing care retirement community operated by the provider in this State, sell its assets or consolidate or merge it with anyanyperson, person, or to make any other material change in its business or corporate structure or management, are fair and reasonable to residents and in the public interest.

(b) Theprovidershall inform all residents in writingwritingoftherequest oftherequest forapproval submitted to the Commissioner pursuant to this section within 10 business days after the request for approval is submitted to the Commissioner.

(2) The proposed third-party manager is affiliated directly or indirectly through ownership, control, or business relations with any person or persons whose business operations are or have been marked by manipulation of assets or accounts or bybybad bad faith, to the detriment of residents, members, stockholders, investors, creditors, or the public.

(2) That a manager is now, or was in the past, affiliated directly or indirectly through ownership interest of ten percent (10%) or more in, or control of, any business, corporation, or other entity that has been convicted of any felony or pleaded nolo contendere to a felonyfelonycharge charge or has been held liable or enjoined DRH40232-NE-98AHouse Bill 719-First Edition Page 43 General Assembly Of North Carolina Session 2025 in a civil action by final judgment involving fraud, embezzlement, fraudulent conversion, or misappropriation of property.

(a) A provider shall maintain after the opening of a continuing care retirement community an operating reserve equal to fifty percent (50%) of the total operating costs of the continuing care retirement communitycommunityforecasted forecasted or projected for the 12-month period following the period covered by the most recent disclosure statement filed with the Department.

(b) Once a continuing care retirement community achieves a 12-month daily average independent living unit occupancy rate of ninety percent (90%) or higher, a provider shall only berequired to maintain an operatingreservein anamount calculatedusingcalculated thetablebelow,unlessusingthetablebelow,unless otherwise instructed by the Commissioner:

12-Month Daily Average Operating Reserve Requirement as a Percentage Independent Living Unit of Total Operating Costs of the Continuing Care Occupancy Rate Retirement Community 90% or above.....................................................................................................................above.....................................................................................................................25.00% 86% to 89.9%....................................................................................................................31.25% 83% to 85.9%....................................................................................................................37.50% 80% to 82.9%....................................................................................................................43.75% Below 80%........................................................................................................................50.00% (c) A provider who has a 12-month daily average independent living unit occupancy rate equal to or in excess of ninety-three percent (93%) and has no long-term debt or a debt service coverage ratio in excess of 2.00 as of the provider's most recent fiscal year-end shall only be required to maintain an operating reserve equal to twelve and one-half percent (12.5%) of total operating costs of the continuing care retirement community, unless otherwise instructed by the Commissioner.

25.00% 86% to 89.9%....................................................................................................................

31.25% 83% to 85.9%....................................................................................................................

37.50% 80% to 82.9%....................................................................................................................

43.75% Below 80%........................................................................................................................

50.00% (c) A provider who has a 12-month daily average independent living unit occupancy rate equal to or in excess of ninety-three percent (93%) and has no long-term debt or a debt service coverage ratio in excess of 2.00 as of the provider's most recent fiscal year-end shall only be required to maintain an operating reserve equal to twelve and one-half percent (12.5%) of total operating costs of the continuing care retirement community, unless otherwise instructed by the Commissioner.

(e) A provider shall notify all residents in writing within 10 business days if the Commissioner, pursuant to subsection (d) of this section, increases the amount a provider is required to maintain as its operatingoperatingreserve reserve for a continuing care retirement communitycommunityoperated operated by the provider or requires the operating reserve to be placed on deposit with the Commissioner.

(b) In addition to total operating expenses, total operating costs will include debt service, consisting of principal and interest payments, along with taxes and insurance on any mortgage Page 44 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 loan or other long-term financing, but will exclude depreciation, amortized expenses, and extraordinary items as approved by the Commissioner.

If the debt service portion is accounted forbyforbywayofanotherreserveaccount, way ofanotherreserveaccount, thedebt serviceportion maybeexcludedupon satisfactory evidence of the existence and purpose of the other reserve account.

(a) Aprovidershall fundits operatingreservewith anyofthefollowinganyofthefollowingqualifyingassets: qualifyingassets:

DRH40232-NE-98AHouse Bill 719-First Edition Page 45 General Assembly Of North Carolina Session 2025 (b) Except as otherwise provided in this subsection, the assets maintained bybythe the provider as an operating reserve for a continuing care retirement community operated by the provider underthis Articleshall not besubject to anyliens, charges, judgments, garnishments, orcreditors' claims and shall not be hypothecated, pledged as collateral, or otherwise encumbered in any manner.

A provider maymayencumber encumber assets held as an operating reserve as part of a securitysecuritypledge pledge of assets or similar collateralization that is part of the provider's debt financing and is included in the provider's debt indenture security instruments related thereto or other similar instrument.

(1) The surety bond maymaybe be exchanged or replaced with another surety bond if (i) the surety bond applies to obligations and liabilities that arose during the period of the original surety bond, (ii) the surety bond meets the requirements of this section, and (iii) 90 days' advance written notice is provided to the Commissioner.

(3) A suretysuretybond bondmaybe may be canceled bybythe the issuer of the bond with respect to future obligations or liabilities upon proper notice pursuant to this section and without regard to approval or acceptance of the Commissioner.

Page 46 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 (b) In order to receive the approval of the Commissioner, a provider shall explain why a release is necessary and, if applicable, submit a repayment schedule to replenish the operating reserve to the amount required by G.S.

As used is this Part, "impaired" means a weakened financial state or condition that maymayaffect affect a provider's ability to pay its obligations as they come due in the normal course of business.

(3) Engagedin anyfraudulentordishonestpracticesinanyfraudulentordishonestpractices in theconduct ofitsbusiness.

DRH40232-NE-98AHouse Bill 719-First Edition Page 47 General Assembly Of North Carolina Session 2025 (11) Failed to deposit entrance fees anddeposits intoan escrow account as required by this Article.

(12) Failed to maintain the operatingoperatingreserve reserve required under this Article or released a portion of the operating reserve required to be maintained under this Article without Commissioner approval.

(h) A provider who has their permanent license revoked shall continue to maintain an operating reserve and to file its annual audited financial statements, annual disclosure statement, andpayandpayannualfeestotheCommissionerasrequiredunderthisArticleasifthepermanentlicense annualfeestotheCommissionerasrequiredunderthisArticleasifthepermanentlicense had continued in full force, but the provider shall not issue anyanynew new continuing care or continuing care at home contracts.

Page 48 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 (2) Adverse findings reported in examination reports, audit financial statements, and actuarial opinions, reports, or summaries.

(10) Whether the management of a provider, including officers, directors, or any other person who directly or indirectlyindirectlycontrols controls the operations of an applicant, provider, or continuing care retirement community, fails to possess and demonstrate the competence, experience, or integrity considered by the Commissioner to be necessary to serve the provider or continuing care retirement community in that position.

DRH40232-NE-98AHouse Bill 719-First Edition Page 49 General Assembly Of North Carolina Session 2025 (2) A date when the provider anticipates it will rectify the problems and deficiencies identified by the Commissioner.

(b) Within 45 days after the submittal of a corrective action plan, the Commissioner shall notifynotifythe the provider whether the corrective action plan shall be implemented or is, in the judgment of the Commissioner, unsatisfactory.

If the Commissioner determines the corrective action plan is unsatisfactory, the notification to the provider shall set forth the reasons for the determination and maymayset set forth proposed revisions that will render the corrective action plan satisfactorysatisfactoryin in the judgment oftheCommissioner.

After receivingnotification from theCommissioner,theprovidertheCommissioner, theprovider shall prepare a revised corrective action plan, if applicable, which may incorporate by reference any revisions proposed by the Commissioner and shall submit the revised corrective action plan to the Commissioner within 30 days after notification from the Commissioner.

(a) TheCommissionermaymakepublicorprivateinvestigations withinoroutsideofthiswithin oroutsideofthis State as necessary to (i) determine whether any person has violated or is about to violate any provision of this Article, (ii) aid in the enforcement of this Article, or (iii) verify statements contained in any disclosure statement or other filing filed or delivered under this Article.

(a) A provider who enters into a binding reservation agreement, continuing care contract, or continuing care at home contract under this Article without having first delivered a disclosure statement meeting the requirements of Part 5 of this Article to the person with whom the binding reservation agreement, continuing care contract, or continuing care at home contract was entered into, or enters into a binding reservation agreement, continuing care contract, or continuing care at home contract with a person who has relied on a disclosure statement that materially misrepresents or omits to state a material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they are made, not misleading, shall be liable to that person for actual damages and repayment of all fees paid to the provider violating this Article, less the costs of care, services, and housing provided to the Page 50 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 resident by or on whose behalf the binding reservation agreement, continuing care contract, or continuing care at home contract was entered into prior to discovery of the violation, misstatement, or omission or the time the violation, misstatement, or omission should reasonably have been discovered, together with interest thereon at the legal rate for judgments, and court costs and reasonable attorneys' fees.

DRH40232-NE-98AHouse Bill 719-First Edition Page 51 General Assembly Of North Carolina Session 2025 (a) If the Commissioner determines that a provider is or has been violating the provisions of this Article, the Commissioner may, after notice and opportunity for hearing, order the provider to cease entering into binding reservation agreements, continuing care contracts, and continuing care at home contracts and make a rescission offer to any resident or depositor who entered into a binding reservation agreement, continuing care contract, or continuing care at home contract while the provider was violating the provisions of this Article in accordance with the provisions of this section.

(c) No resident or depositor shall have the benefit of this section who, within 30 days of receipt, has refused or failed to accept an offer made in writing by the provider to rescind the binding reservation agreement, continuing care contract, or continuing care at home contract in question and to refund the full amount paid by the resident or depositor with interest at the rate established monthlymonthlybythe by the Commissioner of Banks pursuant to G.S.

Regardless of whether delinquency proceedings as to a provider have been or are to be initiated, a provider maymaynot notactivelysolicit, actively solicit, approve the solicitation of, or enter into new binding reservation agreements, continuing care contracts, or continuing care at home contracts in this State after the provider knew, or reasonably should have known, that the provider was impaired or insolvent except with the written permission of the Commissioner.

Page 52 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 (2) A provider has been or will be unable to fullyfullyperform perform its obligations pursuant to continuing care and continuing care at home contracts, or to meet prospective financial data previously filed by the provider.

(d) If, at any time, the Court finds, upon petition of the Commissioner, a provider, or on its own motion, that the objectives of an order to rehabilitate a provider have been accomplished and that the continuing care retirement community or communities owned by, or operated by, the provider can be returned to the provider's management without further jeopardy to the residents or depositors of the continuing care retirement community or communities, the Court may, upon a full report and accounting of the conduct of the provider's affairs during the rehabilitation and of the provider's current financial condition, terminate the rehabilitation and, bybyorder, order, return thecontinuingthecontinuingcareretirementcommunityorcommunities careretirementcommunityorcommunitiesownedby,orowned by,or operated by, the provider, along with the assets and affairs of the provider, to the provider's management.

DRH40232-NE-98AHouse Bill 719-First Edition Page 53 General Assembly Of North Carolina Session 2025 "§ 58-64A-350.

(e) If a semiannual meeting is held under subsection (d) of this section, notice of the method residents maymayuse use to attend the meetingmeetingshall shall be published with the notice of the meeting.

Page 54 DRH40232-NE-98AHouse Bill 719-First Edition General Assembly Of North Carolina Session 2025 "§ 58-64A-365.

No act, agreement, or statement of any resident, or of an individual purchasing continuing care for a resident under any continuing care or continuing care at home contract shall constitute avalid waiverofanywaiverofanyprovision provision ofthis Articleintended forthebenefit or protectionoftheresident or the individual purchasing continuing care for the resident.

(4) Report to the Commissioner on developments in the continuing care retirement communityindustry,includingcommunityindustry,includingcontinuing continuing careat homeand similar programs, and problems or concerns of providers and residents.

(b) ContinuingContinuingcareretirement careretirementcommunitiesandproviderslicensedunderthis communitiesandproviderslicensed underthis Articlethat are also subject to the provisions of the North Carolina Condominium Act under Chapter 47C of the General Statutes shall not be subject to the provisions of Chapter 39A of the General Statutes, provided that the continuing care retirement community's declaration of condominium does not require the payment of any fee or charge not otherwise provided for in a resident's continuing care contract, or other separate contract for the provisions of membership or services.

(d) A provider shall make a copy of the examination report issued by the Commissioner available for inspection by all residents within 10 business days after issuance." DRH40232-NE-98AHouse Bill 719-First Edition Page 55 General Assembly Of North Carolina Session 2025 SECTION 3.

Page 56 DRH40232-NE-98AHouse Bill 719-First Edition