Goldman, Sachs & Co.

Transcription

1 NEW ISSUE Book Entry Only Ratings: See RATINGS herein. In the opinion of Hinckley, Allen & Snyder LLP, Bond Counsel, based upon an analysis of existing law and assuming, among other matters, compliance with certain covenants, interest on the Series N Bonds is excluded from gross income for federal income tax purposes under the Internal Revenue Code of 1986, as amended (the Code ). Interest on the Series N Bonds is not a specific preference item for purposes of the federal individual or corporate alternative minimum taxes, although such interest is included in adjusted current earnings when calculating corporate alternative minimum taxable income. Under existing law, interest on the Series N Bonds and any profit on the sale of the Series N Bonds are exempt from Massachusetts personal income taxes and the Series N Bonds are exempt from Massachusetts personal property taxes. Bond Counsel expresses no opinion regarding any other tax consequences related to the ownership or disposition of, or the accrual or receipt of interest on, the Series N Bonds. See TAX EXEMPTION herein. $233,195,000 MASSACHUSETTS DEVELOPMENT FINANCE AGENCY Revenue Bonds, Dana-Farber Cancer Institute Issue Series N (2016) Dated: Date of Delivery Due Date: December 1, as shown on the inside cover Principal or redemption price of and interest on the $233,195,000 Massachusetts Development Finance Agency Revenue Bonds, Dana-Farber Cancer Institute Issue, Series N (2016) (the Series N Bonds ) will be paid by U.S. Bank National Association, as trustee and paying agent (the Trustee ) under the Agreement (as defined herein) solely from the sources set forth therein. The Series N Bonds will be issued only as fully registered bonds without coupons and, when issued, will be registered in the name of Cede & Co., as Bondowner and nominee for The Depository Trust Company ( DTC ), New York, New York. DTC will act as securities depository for the Series N Bonds. Purchases of the Series N Bonds will be made in book-entry form. Purchasers will not receive certificates representing their interests in the Series N Bonds purchased. So long as Cede & Co. is the Bondowner, as nominee of DTC, references herein to the Bondowners or registered owners shall mean Cede & Co., as aforesaid, and shall not mean the Beneficial Owners of the Series N Bonds. See BOOK-ENTRY ONLY SYSTEM herein. So long as DTC or its nominee, Cede & Co., is the Bondowner, such payments will be made directly to such Bondowner, as more fully described herein. The Series N Bonds will be issued in denominations of $5,000 or any multiple thereof and will bear interest at the rate set forth above, payable on each June 1 and December 1, commencing December 1, The Series N Bonds are subject to redemption prior to maturity, including optional redemption and mandatory sinking fund redemption as set forth in this Official Statement. The Series N Bonds will be special obligations of the Massachusetts Development Finance Agency (the Issuer ) payable solely from the Revenues of the Issuer, including payments to the Trustee, for the account of the Issuer by DanaFarber Cancer Institute, Inc. ( DFCI ) and Dana-Farber, Inc. ( DFI and jointly and severally with DFCI, the Institution ) in accordance with the provisions of the Loan and Trust Agreement dated as of June 1, 2016 (the Agreement ), among the Issuer, the Institution and the Trustee. The payments pursuant to the Agreement are general obligations of the Institution. To secure such payments under the Agreement, an Obligation (as defined herein) will be delivered to the Trustee pursuant to that certain Master Trust Indenture and Mortgage and Security Agreement dated as of May 1, 2008, among the Institution and U.S. Bank National Association, as master trustee (with its successors, the Master Trustee ), as supplemented and amended by the Supplemental Master Indentures (the Master Trust Indenture ) all as more fully described herein. The Obligation, along with certain other obligations issued under the Master Trust Indenture, will be secured by a pledge of the Gross Receipts of the Institution and a mortgage on certain real property of DFCI. Reference is made to this Official Statement for pertinent security provisions of the Master Trust Indenture and the Agreement and for certain Bondowners rights. THE SERIES N BONDS DO NOT CONSTITUTE A GENERAL OBLIGATION OF THE ISSUER OR A DEBT OR PLEDGE OF THE FAITH AND CREDIT OF THE COMMONWEALTH OF MASSACHUSETTS OR ANY POLITICAL SUBDIVISION THEREOF. THE PRINCIPAL, REDEMPTION PRICE OF AND INTEREST ON THE SERIES N BONDS ARE PAYABLE SOLELY FROM THE REVENUES AND FUNDS PLEDGED FOR THEIR PAYMENT UNDER THE AGREEMENT. THE ISSUER HAS NO TAXING POWER UNDER THE ACT. The Series N Bonds are offered when, as and if issued and received by the Underwriter, subject to prior sale, to withdrawal or modification of the offer without notice, and to the approval of their legality and certain other matters by Hinckley, Allen & Snyder LLP, Boston, Massachusetts, Bond Counsel to the Issuer. Certain legal matters will be passed upon for the Institution by its counsel, Ropes & Gray LLP, Boston, Massachusetts. Certain legal matters will be passed upon for the Underwriter by its counsel, Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C., Boston, Massachusetts. It is expected that the Series N Bonds in definitive form will be available for delivery to DTC in New York, New York or its custodial agent on or about June 23, Goldman, Sachs & Co. June 8, 2016

2 $233,195,000 MASSACHUSETTS DEVELOPMENT FINANCE AGENCY Revenue Bonds, Dana-Farber Cancer Institute Issue Series N (2016) MATURITIES, AMOUNTS, INTEREST RATES, PRICES AND YIELDS SERIAL BONDS Maturity December 1 Principal Amount Interest Rate Yield Price CUSIP Number 2029 $8,175, % 2.35% * % 57584XNQ ,615, * XNR ,080, * XNS ,565, * XNT ,075, * XNU ,620, * XNV ,190, * XNW ,790, * XNX5 TERM BONDS $68,170, % Term Bonds Due December 1, 2041, Priced at % to yield 2.76% * ; CUSIP Number 57584XNY3 $85,915, % Term Bonds Due December 1, 2046, Priced at % to yield 2.81% * ; CUSIP Number 57584XNZ0 CUSIP is a registered trademark of the American Bankers Association. CUSIP data herein is provided by CUSIP Global Services, managed by Standard & Poor s Financial Services LLC on behalf of The American Bankers Association. The CUSIP numbers are included solely for the convenience of Bondowners and none of the Issuer, the Institution or the Underwriter is responsible for the selection or the correctness of the CUSIP numbers printed herein. CUSIP numbers assigned to securities may be changed during the term of such securities based on a number of factors, including, but not limited to, the refunding or defeasance of such securities or the use of secondary market financial products. * Yield to the first optional redemption date of December 1, 2026.

3 IN CONNECTION WITH THE OFFERING OF THE SERIES N BONDS, THE UNDERWRITER MAY OVER ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF SUCH SERIES N BONDS AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. No dealer, broker, salesperson, or other person has been authorized by the Issuer, the Institution or the Underwriter to give any information or to make any representations with respect to the Series N Bonds, other than those contained in this Official Statement, and, if given or made, such other information or representations must not be relied upon as having been authorized by any of the foregoing. Certain information contained herein has been obtained from the Institution, DTC and other sources which are believed to be reliable, but is not guaranteed as to accuracy or completeness by, and is not to be construed as a representation of, the Issuer. The information and expressions of opinion herein are subject to change without notice and neither the delivery of this Official Statement nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of the parties referred to above since the date hereof. The Underwriter has provided the following sentence for inclusion in this Official Statement. The Underwriter has reviewed the information in this Official Statement in accordance with, and as part of, its responsibility to investors under the federal securities laws as applied to the facts and circumstances of this transaction, but the Underwriter does not guarantee the accuracy or completeness of such information. The Series N Bonds are not and will not be registered under the Securities Act of 1933, as amended, or under any state securities laws, and the Agreement has not and will not be qualified under the Trust Indenture Act of 1939, as amended, because of available exemptions therefrom. Neither the Securities and Exchange Commission, nor any federal, state, municipal, or other governmental agency, will pass upon the accuracy, completeness, or adequacy of this Official Statement. This Official Statement speaks only as of the date printed on the cover page hereof. The information contained herein in subject to change. The Official Statement will be made available through the Electronic Municipal Market Access System of the Municipal Securities Rulemaking Board. CAUTION REGARDING FORWARD-LOOKING STATEMENTS Certain statements included or incorporated by reference in this Official Statement constitute projections or estimates of future events, generally known as forward-looking statements. These statements are generally identifiable by the terminology used such as plan, expect, estimate, budget or other similar words. The achievement of certain results or other expectations in these forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements described to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. Neither the Issuer nor the Institution plans to issue any updates or revisions to those forward-looking statements if or when changes in their expectations, or events, conditions or circumstances on which these statements are based occur.

4 TABLE OF CONTENTS INTRODUCTION... 1 SOURCES OF PAYMENT AND SECURITY FOR THE SERIES N BONDS... 1 THE ISSUER... 4 THE SERIES N BONDS... 6 DEBT SERVICE REQUIREMENTS... 8 BOOK-ENTRY ONLY SYSTEM... 9 ADDITIONAL INDEBTEDNESS ON A PARITY WITH THE SERIES N BONDS DEBT SERVICE COVERAGE RATIO DAYS OF UNRESTRICTED CASH ON HAND CERTAIN ADDITIONAL FINANCIAL INFORMATION THE PLAN OF FINANCE ESTIMATED APPLICATION OF SERIES N BOND PROCEEDS THE MORTGAGED PROPERTY CONTINUING DISCLOSURE BONDOWNERS RISKS AND MATTERS AFFECTING THE HEALTH CARE INDUSTRY TAX EXEMPTION LEGALITY OF THE SERIES N BONDS FOR INVESTMENT AND DEPOSIT COMMONWEALTH NOT LIABLE ON THE SERIES N BONDS RATINGS UNDERWRITING LEGAL MATTERS LITIGATION FINANCIAL ADVISOR MISCELLANEOUS Page Appendix A Letter from Dana-Farber Cancer Institute, Inc. and Dana-Farber, Inc.... A-1 Appendix B-1 Audited Consolidated Financial Statements of Dana-Farber Cancer Institute, Inc. and Subsidiaries.... B-1-1 Appendix B-2 Unaudited Consolidated Financial Statements of Dana-Farber Cancer Institute, Inc. and Subsidiaries.... B-2-1 Appendix C-1 Definitions of Certain Terms of the Master Trust Indenture... C-1-1 Appendix C-2 Summary of Certain Provisions of the Master Trust Indenture... C-2-1 Appendix C-3 Summary of Certain Provisions of the Eighth Supplemental Master Trust Indenture... C-3-1 Appendix C-4 Definitions of Certain Terms of the Loan and Trust Agreement... C-4-1 Appendix C-5 Summary of Certain Provisions of the Loan and Trust Agreement... C-5-1 Appendix D Proposed Form of Bond Counsel Opinion... D-1 Appendix E Form of Continuing Disclosure Agreement... E-1 i

5 Purpose of this Official Statement OFFICIAL STATEMENT Relating to $233,195,000 MASSACHUSETTS DEVELOPMENT FINANCE AGENCY Revenue Bonds, Dana-Farber Cancer Institute Issue Series N (2016) INTRODUCTION This Official Statement, including the cover page and appendices hereto, sets forth certain information in connection with the issuance and sale of the $233,195,000 Revenue Bonds, Dana-Farber Cancer Institute Issue, Series N (2016) (the Series N Bonds ) of the Massachusetts Development Finance Agency (the Issuer ), a body corporate and politic and a public instrumentality of The Commonwealth of Massachusetts (the Commonwealth ). The Issuer is authorized under Chapter 23G and, to the extent incorporated therein, Chapter 40D of the Massachusetts General Laws (said Chapters, collectively and as amended, the Act ), and pursuant to a resolution of the Issuer adopted on May 31, 2016 (the Resolution ) to issue the Series N Bonds. The Series N Bonds will be issued under a Loan and Trust Agreement (the Agreement ) dated as of June 1, 2016 among the Issuer, Dana- Farber Cancer Institute, Inc. ( DFCI ), Dana-Farber, Inc. ( DFI and jointly and severally with DFCI, the Institution ) and U.S. Bank National Association, as Trustee (the Trustee ). The definitions of certain items used and not otherwise defined herein are contained in Appendix C-1 DEFINITIONS OF CERTAIN TERMS OF THE MASTER TRUST INDENTURE and Appendix C-4 DEFINITIONS OF CERTAIN TERMS OF THE LOAN AND TRUST AGREEMENT. Parity Obligations The Series N Bonds will be equally and ratably secured with any Outstanding Obligations and any future Obligations evidencing or securing Indenture Indebtedness issued under the Master Trust Indenture. See SOURCES OF PAYMENT AND SECURITY FOR THE SERIES N BONDS. Use of Proceeds The proceeds from the sale of the Series N Bonds will be used as follows: (i) a portion of the cost of the acquisition of approximately 203,000 rentable square feet ( RSF ) and fit-out of condominiums and approximately 50,983 RSF of leased space located at 360 Longwood Avenue to be used solely for biomedical research, including wet laboratories and associated research administration and support space, and for the replacement of the Institution s existing mouse vivaria (animal research facilities) and fit-out of a consolidated state-of-the art mouse vivarium, with approximately $81 million of such cost to be funded from other moneys of the Institution; (ii) approximately $4.7 million of the $8.6 million total cost of replacing a roughly 20 year-old HVAC system in the Smith Building, with amounts in excess of $4.7 million to be funded from operations as routine capital expenditures; (iii) the relocation to, reconstruction and equipping of the Institution s Cell Manipulation Core Facility; and (iv) other uses including payment of the costs of issuance of the Series N Bonds and interest during the purchase and construction periods, and various other capital projects. See THE PLAN OF FINANCE and ESTIMATED APPLICATION OF SERIES N BOND PROCEEDS. General SOURCES OF PAYMENT AND SECURITY FOR THE SERIES N BONDS The Agreement provides that to the extent permitted by law, it is a general obligation of the Institution and that the full faith and credit of the Institution are pledged to its performance. The Agreement also provides, among other things, that the Institution shall make payments to the Trustee equal to principal installments and interest on

6 the Series N Bonds and certain other payments required by the Agreement. As additional security for its obligations to make payments to the Debt Service Fund and the Redemption Fund, and for its other payment obligations under the Agreement, the Institution has granted to the Trustee with respect to the Debt Service Fund, Project Fund, the Rebate Fund and Redemption Fund, a security interest in its interest in the moneys and other investments and any proceeds thereof held from time to time in such Funds established under the Agreement except the Rebate Fund. The Agreement shall remain in full force and effect until such time as all of the Series N Bonds and the interest thereon have been fully paid or until adequate provision for such payments has been made. Assignment and Pledge Under the Agreement, the Issuer assigns and pledges to the Trustee in trust upon the terms of the Agreement (i) all Revenues to be received from the Institution or derived from any security provided under the Agreement, (ii) all rights to receive such Revenues and the proceeds of such rights, (iii) all funds and investments held from time to time in the funds established under the Agreement and (iv) all of its right, title and interest in the Agreement, including enforcement rights and remedies but excluding certain rights of indemnification and to reimbursement of certain expenses. Under the Act, to the extent authorized or permitted by law, the pledge of Revenues is valid and binding from the time when such pledge is made and the Revenues and all income and receipts earned on funds held by the Trustee for the account of the Issuer shall immediately be subject to the lien of such pledge without any physical delivery thereof or further act, and the lien of such pledge shall be valid and binding as against all parties having claims of any kind in tort, contract or otherwise against the Issuer irrespective of whether such parties have notice thereof. The assignment and pledge by the Issuer does not include (i) the rights of the Issuer pursuant to provisions for consent, concurrence, approval or other action by the Issuer, notice to the Issuer or the filing of reports, certificates or other documents with the Issuer, (ii) the right of the Issuer to any payment or reimbursement pursuant to the Agreement, or (iii) the powers of the Issuer as stated in the Agreement to enforce the provisions thereof. Special Obligations The Series N Bonds are special obligations of the Issuer, equally and ratably secured by and payable from a pledge of and lien on, to the extent provided by the Agreement, the moneys received with respect to the Series N Bonds by the Trustee for the account of the Issuer pursuant to the Agreement, whether such moneys are received as Revenues paid or caused to be paid by the Institution pursuant to the Agreement. Security under the Master Trust Indenture The Series N Bonds are secured by Obligation No. 12 registered in the name of the Trustee and issued under the Master Trust Indenture and Mortgage and Security Agreement dated as of May 1, 2008 (as supplemented and amended from time to time, the Master Trust Indenture ) among DFI, DFCI and U.S. Bank National Association, as Master Trustee (the Master Trustee ), and the Eighth Supplemental Master Trust Indenture for Obligation No. 12 dated as of June 1, 2016 (the Eighth Supplemental Master Indenture ) between DFCI, as Representative (the Representative ) of the Obligated Group, and the Master Trustee. The Initial Members of the Obligated Group in the Master Trust Indenture are DFI and DFCI (each, a Member of the Obligated Group or Member ). Obligation No. 12 is subject to the same payment and prepayment terms as the Institution s obligations with respect to the Series N Bonds under the Agreement. Obligation No. 12 and the Eighth Supplemental Master Indenture provide that the Obligated Group shall receive credit, to the extent, in the manner and with the effect provided in the Eighth Supplemental Master Indenture, for payments of principal and redemption of, and interest required on Obligation No. 12 in amounts equal to (i) amounts paid under the Agreement for the payment of principal and interest on the Series N Bonds and (ii) Bonds purchased and delivered to the Trustee. The Master Trust Indenture provides that any Obligation issued thereunder, such as Obligation No. 12, is a joint and several obligation of all Members of the Obligated Group. Gross Receipts. As provided in the Master Trust Indenture, each Member of the Obligated Group has granted, and each additional Person admitted to the Obligated Group shall grant as a condition of such admission, to the Master Trustee a security interest in all of its Gross Receipts (subject to the right of any Member to grant a prior Lien as permitted under the Master Trust Indenture) as security for its obligation to make payments under all 2

7 Obligations issued under the Master Trust Indenture, including Obligation No. 12. Each Member of the Obligated Group represents and warrants in the Indenture that the Lien granted on the Gross Receipts is and at all times will be a first Lien, subject only to (i) Liens permitted by the Master Trust Indenture and (ii) nonconsensual Liens arising by operation of law. The enforcement of the Lien on Gross Receipts may be subject to limitations imposed by the Bankruptcy Code and to the exercise of discretion by a court of equity and to other significant conditions and limitations, including restrictions upon assignment of accounts receivable and the proceeds thereof under the Medicare and Medicaid programs. See BONDOWNERS RISKS AND MATTERS AFFECTING THE HEALTH CARE INDUSTRY Enforceability of Lien on Gross Receipts. In addition, the obligation of one Member to make payments with respect to obligations of another Member may be declared void, or such payments may be otherwise prohibited, in certain circumstances. See BONDOWNERS RISKS AND MATTERS AFFECTING THE HEALTH CARE INDUSTRY Enforceability of Master Trust Indenture and Agreement. Mortgage. In addition, DFCI has granted a mortgage on certain of its properties located in Boston, Massachusetts (the Mortgaged Property ) to secure the Obligated Group s obligation to make payments under all Obligations issued under the Master Trust Indenture, including Obligation No. 12. See THE MORTGAGED PROPERTY. The Master Trust Indenture contains restrictions on the creation of certain Liens and encumbrances with respect to certain property of the Obligated Group and of any additional future Members of the Obligated Group, with certain exceptions. See Appendix C-2 SUMMARY OF CERTAIN PROVISIONS OF THE MASTER TRUST INDENTURE under the headings Limitations on Creation of Liens and Sale, Lease or Other Disposition of Property. The property purchased with the proceeds of the Series N Bonds will not be subject to the Mortgage. Additional Members under the Master Trust Indenture; Withdrawal. The Master Trust Indenture contains provisions permitting the issuance of additional Obligations on a parity with the previously issued Obligations and Obligation No. 12. See ADDITIONAL INDEBTEDNESS ON A PARITY WITH THE SERIES N BONDS herein and Appendix C-2 SUMMARY OF CERTAIN PROVISIONS OF THE MASTER TRUST INDENTURE under the headings Limitations on Creation of Liens and Limitations on Incurrence of Additional Indebtedness. The Master Trust Indenture also contains provisions permitting the addition, withdrawal or consolidation of Members under certain conditions. See Appendix C-2 SUMMARY OF CERTAIN PROVISIONS OF THE MASTER TRUST INDENTURE under the headings Conditions for Membership, Withdrawal From the Obligated Group and Consolidation, Merger, Sale or Conveyance. Joint and Several Obligation. Each Member of the Obligated Group has unconditionally and irrevocably agreed that it shall be jointly and severally obligated, and agreed, to pay all amounts becoming due and payable on all Obligations issued under the Master Trust Indenture according to the terms thereof. If for any reason any payment required pursuant to the terms of any Obligation issued hereunder has not been timely paid, each Member shall be obligated to make such payment. Each Member has agreed with each other Member that, as among themselves, with respect to Indenture Indebtedness incurred on its behalf or the net proceeds of which have been received by it or for its direct benefit and evidenced or secured by an Obligation, it will be primarily liable to make full and timely payment on such Indenture Indebtedness. Acceleration. The Master Trustee may and upon the written request of the Holders of at least a majority in aggregate principal amount of the Obligations Outstanding, shall, declare the Series N Bonds and all other Outstanding Obligations immediately due and payable prior to maturity upon the occurrence of an Event of Default under the Agreement. See Appendix C-5 SUMMARY OF CERTAIN PROVISIONS OF THE LOAN AND TRUST AGREEMENT Remedies for Events of Default. THE SERIES N BONDS DO NOT CONSTITUTE A GENERAL OBLIGATION OF THE ISSUER OR A DEBT OR PLEDGE OF THE FAITH AND CREDIT OF THE COMMONWEALTH OF MASSACHUSETTS OR ANY POLITICAL SUBDIVISION THEREOF. THE PRINCIPAL, REDEMPTION PRICE OF AND INTEREST ON THE SERIES N BONDS ARE PAYABLE SOLELY FROM THE REVENUES AND FUNDS PLEDGED FOR THEIR PAYMENT UNDER THE AGREEMENT. THE ISSUER HAS NO TAXING POWER UNDER THE ACT. 3

8 Amendments to the Master Trust Indenture Pursuant to the Master Trust Indenture, certain supplements or amendments to the Master Trust Indenture may take effect only when approved by the Holders of the majority in aggregate principal amount of the Outstanding Obligations. See Appendix C-2 SUMMARY OF CERTAIN PROVISIONS OF THE MASTER TRUST INDENTURE under the headings Supplements Not Requiring Consent of Obligation Holders and Supplements Requiring Consent of Obligation Holders. In connection with the issuance of the Series N Bonds, the Institution intends to supplement and amend the Master Trust Indenture in order to make the following changes which will only become effective at such time as Holders of a majority in aggregate principal amount of Obligations Outstanding agree to such provisions or are deemed to have agreed to such provisions by agreeing to become Obligation Holders: (1) The definition of Assumed Rate in Section 1.02 of the Master Trust Indenture is amended by adding or financial advisor after each instance of the phrase an investment banking firm. (2) Section 1.04(c) of the Master Trust Indenture is amended and restated to read in its entirety as follows: (c) Where the character or amount of any asset, liability or item of revenue or expense is required to be determined or any consolidation, combination or other accounting computation is required to be made for the purposes hereof or of any agreement, document or certificate executed and delivered in connection with or pursuant to this Indenture, the same shall be done in accordance with generally accepted accounting principles (i) at the time in effect, to the extent applicable, except where such principles are inconsistent with the requirements hereof or of such agreement, document or certificate in which case such agreement, document or certificate shall state that it was not done in accordance with generally accepted accounting principles; or, (ii) at the sole option of the Representative, (A) the date such determination or computation is made for any purpose of this Indenture or (B) the date of execution and delivery of this Indenture if the Representative delivers an Officer's Certificate to the Master Trustee describing why then-current generally accepted accounting principles are inconsistent with the intent of the parties on the date of execution and delivery of this Indenture (including, but not limited to, to exclude the effect of FASB ASC Topic 842, Leases relating to treatment of leases formerly classified as operating leases under generally accepted accounting principles). With respect to the amendments set forth above, by their purchase of the Series N Bonds and acceptance of Obligation No. 12, the Bondowners shall consent and shall be deemed to have consented to such amendments. Such amendments will apply to the Series N Bonds, Obligation No. 12 and any current and future Obligations only when the Holders of the majority in aggregate principal amount of the Outstanding Obligations have consented to such amendments. See Appendix C-3 SUMMARY OF CERTAIN PROVISIONS OF THE EIGHTH SUPPLEMENTAL MASTER TRUST INDENTURE under the heading Amendments to the Master Trust Indenture for a further description of the proposed amendments. THE ISSUER The Issuer is authorized and empowered under the laws of Massachusetts, including the Act, to issue the Series N Bonds for the purposes described herein and to enter into the Agreement and other agreements and instruments necessary to issue and secure the Series N Bonds. 4

9 The Members of the Board of Directors and the officers of the Issuer authorized to sign documents related to bond transactions are as follows: Members of the Board of Directors Ex-Officio Members Chairperson, Secretary of the Executive Office of Housing and Economic Development, The Commonwealth of Massachusetts. Secretary, the Executive Office for Administration and Finance, The Commonwealth of Massachusetts, or the Secretary s designee. Appointed Members James Chisholm, Vice President for Business Development, Advantage Waypoint Gerald D. Cohen, Vice Chair, Founder and Principal, SF Properties, Inc. Karen G. Courtney, President, K. Courtney and Associates, Inc., and Executive Director, The Foundation for Fair Contracting of Massachusetts Keon T. Holmes, Managing Director, Cambridge Associates LLC Dennis Kanin, Co-Founder and Principal, New Boston Ventures LLC Brian Kavoogian, Principal, Charles River Realty Advisors Patricia McGovern, Consultant, formerly General Counsel and Senior Vice President at Beth Israel Deaconess Medical Center (retired) Christopher Vincze, Chairman and CEO, TRC Solutions, Inc. There is one vacancy on the Board of Directors. Officers of the Issuer Marty Jones, President and Chief Executive Officer Simon R. Gerlin, Treasurer, Chief Financial Officer and Executive Vice President for Finance & Administration Anne Marie Dowd, Executive Vice President, Legislative and Defense Sector Initiatives Laura L. Canter, Executive Vice President for Finance Programs Richard C.J. Henderson, Executive Vice President for Real Estate Patricia A. DeAngelis, General Counsel Teresa M. Patten, Secretary Steven J. Chilton, Senior Vice President, Investment Banking (Mr. Chilton has signing authority for bond transactions only.) 5

10 Except for the information contained herein under the caption THE ISSUER and LITIGATION insofar as it relates to the Issuer, the Issuer has not provided any of the information contained in this Official Statement. The Issuer is not responsible for and does not certify as to the accuracy or sufficiency of the disclosures made herein or any other information provided by the Institution, the Underwriter or any other person. Description of the Series N Bonds THE SERIES N BONDS The Series N Bonds will be dated their date of issuance and will bear interest from such date, payable on December 1, 2016 and on each June 1 and December 1 thereafter at the rates set forth on the inside cover page hereof and will mature on December 1 of the indicated years and in the principal amounts set forth on the inside cover page hereof. Subject to the provisions discussed under BOOK ENTRY ONLY SYSTEM below, the Series N Bonds are issuable as fully registered bonds without coupons in the minimum denomination of $5,000 or any multiple thereof. Principal and redemption price of the Series N Bonds will be payable at the principal corporate trust office of the Trustee, and interest on the Series N Bonds will be paid by check or draft mailed to the registered owner as of the 15th day of the month preceding the date on which the interest is to be paid (the Record Date ), or by wire transfer as provided in the Agreement. Principal, Sinking Fund Installments and Interest Requirements The amounts required to be made available by the Institution for payment of the principal of and sinking fund installments on the Series N Bonds, interest on the Series N Bonds and total debt service on the Series N Bonds are set forth under DEBT SERVICE REQUIREMENTS herein. Redemption of the Series N Bonds Optional Redemption. The Series N Bonds are subject to optional redemption prior to maturity, on or after December 1, 2026 at the option of the Institution by written direction of the Institution to the Issuer and the Trustee, as a whole or in part at any time in such order of maturity or sinking fund installments as directed by the Institution at par plus accrued interest to the redemption date. Mandatory Sinking Fund Redemption. The Series N Bonds maturing December 1, 2041 will be subject to mandatory sinking fund redemption and shall be redeemed by sinking fund installments on December 1 in each of the years and in the amounts set forth below at a redemption price equal to the principal amount thereof, plus accrued interest to the date of redemption, as follows: Year Principal Amount 2037 $12,400, ,985, ,605, ,250, * 14,930,000 * Final maturity The Series N Bonds maturing December 1, 2046 will also be subject to mandatory sinking fund redemption and shall be redeemed by sinking fund installments on December 1 in each of the years and in the amounts set forth below at a redemption price equal to the principal amount thereof, plus accrued interest to the date of redemption, as follows: 6

11 Year Principal Amount 2042 $15,630, ,370, ,150, ,950, * 18,815,000 * Final Maturity Selection of the Series N Bonds for Redemption. Series N Bonds called for redemption pursuant to the optional redemption provisions described above shall be credited to particular maturities as directed by the Institution. If less than all the Series N Bonds of a maturity shall be called for redemption, the particular Series N Bonds to be so redeemed shall be selected by the Institution or by the Trustee by lot; provided, however, that so long as DTC (as hereinafter defined) or its nominee is the Bondowner, the particular Series N Bonds or portions of the Series N Bonds of such maturity to be redeemed shall be selected by DTC in such manner as DTC may determine. If a Series N Bond is of a denomination in excess of five thousand dollars ($5,000), portions of the principal amount in the amount of five thousand dollars ($5,000) or any multiple thereof may be redeemed. Purchase in Lieu of Redemption. The Institution may purchase Series N Bonds of any maturity and credit them against the principal payment for such maturity at the principal amount, by delivering them to the Trustee for cancellation at least sixty (60) days before the principal payment date. In addition, when Series N Bonds are called for redemption, the Institution may purchase some or all of the Series N Bonds called for redemption if it gives written notice, as appropriate, to the Trustee and the Issuer not later than the day before the redemption date that it wishes to purchase the principal amount of Series N Bonds specified in the notice, at a purchase price equal to the redemption price. On the date specified as the redemption date, the Trustee will be furnished sufficient funds in sufficient time for the Trustee to make the purchase on the redemption date. Any such purchase of Series N Bonds by the Institution shall not be deemed to be a payment or redemption of the Series N Bonds or any portion thereof and such purchase shall not operate to extinguish or discharge the indebtedness evidenced by such Series N Bonds. Notice of Redemption. The Trustee shall mail notice of redemption to the Bondowners not less than twenty (20) days nor more than forty five (45) days prior to the date fixed for redemption. Failure to mail notice to a particular Bondowner, or any defect in the notice to such Bondowner, shall not affect the redemption of any other Series N Bond. So long as DTC or its nominee is the Bondowner, the Issuer and the Trustee will recognize DTC or its nominee as the Bondowner for all purposes, including notices and voting. Any failure on the part of DTC or failure on the part of a nominee of a Beneficial Owner (as hereinafter defined), having received notice from a DTC Participant (as hereinafter defined) or otherwise, to notify the Beneficial Owner so affected shall not affect the validity of the redemption. Any notice of optional redemption may state that the redemption is conditioned upon the availability of sufficient funds for such redemption on the redemption date. Effect of Redemption. On the redemption date, the redemption price of each Series N Bond to be redeemed will become due and payable; and from and after such date, notice having been properly given and amounts having been made available and set aside from such redemption in accordance with the provisions of the Agreement, notwithstanding that any Series N Bonds called for redemption have not been surrendered, no further interest will accrue on any Series N Bonds called for redemption. Acceleration In addition to the foregoing redemption provisions, the Trustee may, upon the occurrence of an Event of Default, as defined in the Agreement, by written notice to the Institution and the Issuer, declare immediately due and payable the principal amount of the Outstanding Bonds and the payments to be made by the Institution therefor, and accrued interest on the foregoing, whereupon the same shall become immediately due and payable without any further action or notice. See Appendix C 5 - SUMMARY OF CERTAIN PROVISIONS OF THE LOAN AND TRUST AGREEMENT under the headings Events of Default and Remedies for Events of Default. 7

12 DEBT SERVICE REQUIREMENTS The following table sets forth, for each fiscal year of the Institution ending September 30, the amounts required to be made available in such year by the Institution for payment of the principal of and interest on its outstanding indebtedness after the issuance of the Series N Bonds. Year Ending September 30, Total Debt Service on other Long-Term Indebtedness (1) Total Debt Service on Long-Term (2) (3) Indebtedness Principal of the Series N Bonds Interest on the Series N Bonds $23,894,709 $23,894, $10,947,210 23,793,865 24,140, ,659,750 23,661,687 32,111, ,659,750 23,681,258 34,842, ,659,750 23,697,777 35,357, ,659,750 23,715,707 35,375, ,659,750 23,737,531 35,397, ,659,750 23,788,934 35,448, ,659,750 23,814,679 35,474, ,659,750 23,840,387 35,500, ,659,750 23,864,195 35,523, ,659,750 23,889,949 35,549, ,659,750 23,075,739 34,735, ,659,750 22,937,621 34,597, $8,175,000 11,455,375 15,651,159 35,281, ,615,000 11,035,625 15,627,230 35,277, ,080,000 10,593,250 15,605,825 35,279, ,565,000 10,127,125 15,585,995 35,278, ,075,000 9,636,125 15,566,839 35,277, ,620,000 9,118,750 15,542,394 35,281, ,190,000 8,573,500 15,516,792 35,280, ,790,000 7,999,000 15,489,071 35,278, ,400,000 7,394,250 15,485,469 35,279, ,985,000 6,759,625 15,532,174 35,276, ,605,000 6,094,875 15,579,874 35,279, ,250,000 5,398,500 15,628,837 35,277, ,930,000 4,669,000 15,682,326 35,281, ,630,000 3,905,000 15,744,582 35,279, ,370,000 3,105,000 15,805,308 35,280, ,150,000 2,267,000 15,863,358 35,280, ,950,000 1,389,500 15,937,447 35,276, ,815, ,375 15,991,820 35,277,195 (1) (2) (3) Total Debt Service on other Long-Term Indebtedness is calculated in accordance with the terms of the Master Trust Indenture. Series M Balloon Indebtedness due on December 1, 2028 is amortized for level debt service at an interest rate equal to 5.353% per annum. Interest on variable rate Indebtedness which is not subject to a Hedging Contract is calculated at the average interest rate for the preceding twelve months. For the unhedged portion of the Series L-1 Bonds, Series L-2A Bonds, and Series L-2B Bonds (collectively, Series L Bonds ) this equals 0.9%, 1.8%, and 0.9% per annum, respectively, as of March 31, Interest on variable rate Indebtedness which is subject to a Hedging Contract is calculated at the interest rate payable on the Hedging Contract plus amounts required to be paid as a result of the differential between the interest rate received pursuant to the Hedging Contract and the interest rate required to be paid on the variable rate Indebtedness. For the hedged portions of the Series L-1 Bonds, Series L-2A Bonds, and Series L-2B Bonds this equals 4.6%, 5.5%, and 4.6% per annum, respectively, as of March 31, Includes capital leases and is net of funded capitalized interest on the Series N Bonds, assumed to earn 0.40% per annum, which accounts for $10,600,293 in fiscal year 2017, $3,209,479 in fiscal year 2018, and $498,402 in fiscal year Totals may not add due to rounding. 8

13 BOOK-ENTRY ONLY SYSTEM The Depository Trust Company ( DTC ), New York, New York, will act as securities depository for the Series N Bonds. The Series N Bonds will be issued as fully registered securities registered in the name of Cede & Co. (DTC s partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully registered bond certificate will be issued for each maturity, or for each interest rate within a maturity, if applicable, of the Series N Bonds, each in the aggregate principal amount of such maturity, and will be deposited with DTC. DTC, the world s largest securities depository, is a limited purpose trust company organized under the New York Banking Law, a banking organization within the meaning of the New York Banking Law, a member of the Federal Reserve System, a clearing corporation within the meaning of the New York Uniform Commercial Code, and a clearing agency registered pursuant to the provisions of Section 17A of the Securities Exchange Act of DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-u.s. equity issues, corporate and municipal debt issues, and money market instruments (from over 100 countries) that DTC s participants ( Direct Participants ) deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities, through electronic computerized bookentry transfers and pledges between Direct Participants accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-u.s. securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations. DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation ( DTCC ). DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-u.s. securities brokers and dealers, banks, trust companies, and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ( Indirect Participants ). DTC has Standard & Poor s rating: AA+. The DTC Rules applicable to its Participants are on file with the Securities and Exchange Commission. More information about DTC can be found at and Purchases of the Series N Bonds under the DTC system must be made by or through Direct Participants, which will receive a credit for the Series N Bonds on DTC s records. The ownership interest of each actual purchaser of each Bond (a Beneficial Owner ) is in turn to be recorded on the Direct and Indirect Participants records. Beneficial Owners will not receive written confirmation from DTC of their purchase, Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the Series N Bonds are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in the Series N Bonds, except in the event that use of the book entry system for the Series N Bonds is discontinued. To facilitate subsequent transfers, all Series N Bonds deposited by Direct Participants with DTC are registered in the name of DTC s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of Series N Bonds with DTC and their registration in the name of Cede & Co. or such other nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the Series N Bonds; DTC s records reflect only the identity of the Direct Participants to whose accounts such Series N Bonds are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers. Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Beneficial Owners of the Series N Bonds may wish to take certain steps to augment the transmission to them of notices of significant events with respect to the Series N Bonds, such as redemptions, defaults and proposed amendments to the documents relating to the Series N Bonds. For example, Beneficial Owners of the Series N Bonds may wish to ascertain that the nominee holding the Series N Bonds for their benefit has agreed to obtain and 9

14 transmit notices to the Beneficial Owners. In the alternative, Beneficial Owners may wish to provide their names and addresses to the registrar and request that copies of notices be provided directly to them. Redemption notices shall be sent to DTC. If less than all of the Series N Bonds within a maturity bearing the same interest rate are being redeemed, DTC s practice is to determine by lot the amount of the interest of each Direct Participant in such maturity to be redeemed. Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to the Series N Bonds unless authorized by a Direct Participant in accordance with DTC s Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to the Issuer as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co. s consenting or voting rights to those Direct Participants to whose accounts the Series N Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy). Principal and interest payments on the Series N Bonds will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC s practice is to credit Direct Participants accounts, upon DTC s receipt of funds and corresponding detail information from the Issuer or the Trustee, on the payable date in accordance with their respective holdings shown on DTC s records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in street name, and will be the responsibility of such Participant and not of DTC, the Trustee, or the Issuer, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal and interest to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of the Issuer or the Trustee, disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants. DTC may discontinue providing its services as a depository with respect the Series N Bonds at any time by giving reasonable notice to the Issuer and the Trustee. Under such circumstances, in the event that a successor depository is not obtained, bond certificates are required to be printed and delivered. The Issuer may decide to discontinue use of the system of book-entry transfers through DTC (or a successor securities depository). In that event, bond certificates will be printed and delivered to DTC. THE INFORMATION IN THIS SECTION CONCERNING DTC AND DTC S BOOK ENTRY SYSTEM HAS BEEN OBTAINED FROM SOURCES THAT THE ISSUER BELIEVES TO BE RELIABLE, BUT NONE OF THE ISSUER, THE UNDERWRITER, OR THE INSTITUTION TAKES ANY RESPONSIBILITY FOR THE ACCURACY THEREOF. No Responsibility of the Issuer, Institution and Trustee. NONE OF THE ISSUER, THE INSTITUTION, OR THE TRUSTEE WILL HAVE ANY RESPONSIBILITY OR OBLIGATIONS TO DIRECT PARTICIPANTS OR THE PERSONS FOR WHOM THEY ACT AS NOMINEES WITH RESPECT TO THE PAYMENTS TO OR THE PROVIDING OF NOTICE FOR DIRECT PARTICIPANTS, INDIRECT PARTICIPANTS, OR BENEFICIAL OWNERS. SO LONG AS CEDE & CO. IS THE REGISTERED OWNER OF THE SERIES N BONDS, AS NOMINEE OF DTC, REFERENCES HEREIN TO THE BONDOWNERS OR REGISTERED OWNERS OF THE SERIES N BONDS SHALL MEAN CEDE & CO. AND SHALL NOT MEAN THE BENEFICIAL OWNERS OF THE SERIES N BONDS. 10

15 ADDITIONAL INDEBTEDNESS ON A PARITY WITH THE SERIES N BONDS Outstanding Indenture Indebtedness. The aggregate principal amount of Indenture Indebtedness and the principal amount of each Obligation that may be issued, authenticated and delivered under the Master Trust Indenture is not limited except by the provisions of the Master Trust Indenture or the Related Supplements. See Appendix C-2 SUMMARY OF CERTAIN PROVISIONS OF THE MASTER TRUST INDENTURE under the heading Limitations on Incurrence of Additional Indebtedness. As of the date of issuance of the Series N Bonds and the anticipated application of the net proceeds thereof, Indenture Indebtedness will consist of the Series K Bonds, Series L Bonds, Series M Bonds and certain obligations related to the 2007 Swap Agreements. See Appendix A LETTER FROM DANA-FARBER CANCER INSTITUTE, INC. AND DANA-FARBER, INC. FINANCIAL INFORMATION Long-Term Debt. DEBT SERVICE COVERAGE RATIO The Obligated Group agrees to use its best efforts to maintain a Maximum Annual Debt Service Ratio at least equal to 1.15 calculated as of the end of each Fiscal Year. Within one hundred and fifty (150) days after the end of each Fiscal Year, the Obligated Group shall furnish to the Master Trustee an Officer s Certificate stating, based on calculations shown in such Certificate, that the requirement of the foregoing sentence was met as of the end of such Fiscal Year. If the Maximum Annual Debt Service Ratio, as calculated as of the end of any Fiscal Year, is less than 1.15, the Obligated Group covenants to retain a Consultant to make recommendations to increase such ratio for subsequent Fiscal Years to the levels required or, if in the opinion of the Consultant the attainment of such level is impracticable, to the highest practicable level. Each Member of the Obligated Group, respectively, has agreed that it will, to the extent permitted by law and subject to Legal Limitations, substantially follow the recommendations of the Consultant or file with the Master Trustee its reasons for not following the recommendations. So long as the Obligated Group shall retain a Consultant and each Member of the Obligated Group shall follow such Consultant s recommendations except as set forth above, this provision shall be deemed to have been complied with even if such ratio for any subsequent Fiscal Year, calculated as of the end of such Fiscal Year, is less than If in any Fiscal Year the Maximum Annual Debt Service Ratio is less than 1.15, calculated as of the end of such Fiscal Year, the Obligated Group will not be required to retain a Consultant to make such recommendations if a written report of a Consultant is filed with the Master Trustee which contains an opinion of such Consultant that (i) applicable laws or regulations have prevented the maintenance of the 1.15 ratio, (ii) the Members of the Obligated Group have generated the maximum amount of Income Available for Debt Service which in the opinion of such Consultant could reasonably have been generated given such laws and regulations during the period affected thereby and (iii) the ratio actually achieved was at least The Obligated Group shall not be required to cause the Consultant s report referred to in this paragraph to be prepared more frequently than once every two Fiscal Years if at the end of the first of such two Fiscal Years the Obligated Group provides to the Master Trustee (who shall provide a copy to each Obligation Holder, Related Bond Trustee and Related Issuer) an Opinion of Counsel (which counsel and opinion, including without limitation the scope, form, substance and other aspects thereof, are acceptable to the Master Trustee) to the effect that the applicable laws and regulations underlying the Consultant s report delivered in respect of the previous Fiscal Year have not changed in any material way. If as of the end of any Fiscal Year the Maximum Annual Debt Service Ratio is less than 1.00, then the Obligated Group shall be deemed to be in default under the Master Trust Indenture. DAYS OF UNRESTRICTED CASH ON HAND Pursuant to the Master Trust Indenture, the Obligated Group has agreed that it will maintain Days of Unrestricted Cash on Hand of at least 85 days at the end of each Fiscal Year. Within one hundred and fifty (150) days after the end of each Fiscal Year, the Obligated Group shall furnish to the Master Trustee an officer s certificate stating, based on calculations shown in such certificate, that the requirement of the foregoing sentence was met at the end of the Fiscal Year, calculated as of the end of such Fiscal Year. If the Days of Unrestricted Cash on Hand, as calculated at the end of any Fiscal Year, is less than 85 days, the Obligated Group has covenanted to retain a Consultant to make recommendations to increase the Days of Unrestricted Cash on Hand for subsequent Fiscal Years to the levels required or, if in the opinion of the Consultant the attainment of such level is impracticable, to the highest practicable level. Each Member of the Obligated Group, respectively, has agreed that it will, to the extent permitted by law and subject to Legal Limitations, substantially follow the recommendations of the Consultant or file with the Master Trustee its reasons for not following the recommendations. So long as the 11

16 Obligated Group shall retain a Consultant and each Member of the Obligated Group shall follow such Consultant s recommendations except as set forth above, this provision shall be deemed to have been complied with even if the Days of Unrestricted Cash on Hand for any subsequent Fiscal Year is less than 85. If at the end of any Fiscal Year the Days of Unrestricted Cash on Hand is less than 85, the Obligated Group will not be required to retain a Consultant to make such recommendations if a written report of a Consultant is filed with the Master Trustee which contains an opinion of such Consultant that (i) applicable laws or regulations have prevented the maintenance of 85 Days of Unrestricted Cash on Hand, (ii) the Members of the Obligated Group have generated the maximum amount of Income Available for Debt Service which in the opinion of such Consultant could reasonably have been generated given such laws and regulations during the period affected thereby and (iii) the Days of Unrestricted Cash on Hand actually achieved was at least 60. The Obligated Group shall not be required to cause the Consultant s report referred to in this paragraph to be prepared more frequently than once every two Fiscal Years if at the end of the first of such two Fiscal Years the Obligated Group provides to the Master Trustee (who shall provide a copy to each Obligation Holder, Related Bond Trustee and Related Issuer) an Opinion of Counsel (which counsel and opinion, including without limitation the scope, form, substance and other aspects thereof, are acceptable to the Master Trustee) to the effect that the applicable laws and regulations underlying the Consultant s report delivered in respect of the previous Fiscal Year have not changed in any material way. If at the end of any Fiscal Year the Days of Unrestricted Cash on Hand is less than 60, then the Obligated Group shall be deemed to be in default under the Master Trust Indenture. CERTAIN ADDITIONAL FINANCIAL INFORMATION The following tables set forth the historical and pro forma capitalization, days cash on hand and historical and pro forma debt service coverage for the Institution. For detailed operating and financial information about DFCI and DFI, see Appendices A, B-1 and B-2 to this Official Statement. Historical and Pro Forma Capitalization The table below was prepared by the Institution s management and represents the capitalization of the Institution as of September 30, 2015 and 2014 and as of March 31, The table was prepared from audited consolidated financial statements of the Institution for the years ended September 30, 2015 and 2014 which are included in Appendix B-1 hereto and the unaudited consolidated financial statements of the Institution for the six months ended March 31, 2016 which are included in Appendix B-2 hereto. The pro forma column reflects the issuance of the Series N Bonds as if such bonds were outstanding as of March 31, Dana-Farber Cancer Institute, Inc. and Dana-Farber, Inc. Consolidated Capitalization ($ in thousands) September 30, (unaudited) March 31, Pro Forma March 31, Long-Term Debt Series K Bonds $91,409 $87,713 $84,003 $84,003 Series L Bonds 185, , , ,000 Series M Bonds 50,860 50,860 50,860 50,860 Series N Bonds ,195 Milford lease obligation 9,467 8,976 8,722 8,722 South Shore lease obligation 22,482 21,182 20,508 20,508 Total Long-Term Debt 359, , , ,288 Unrestricted Net Assets 607, , , ,668 Total Capitalization $966,882 $974,350 $1,007,761 $1,240,956 Total Long-Term Debt as a percentage of Total Capitalization 37.2% 36.3% 34.6% 46.9% 12

17 Days of Unrestricted Cash on Hand A calculation of the Days of Unrestricted Cash on Hand of the Institution as of the twelve months ended September 30, 2015 and 2014 and as of the six months ended March 31, 2016 is set forth below. Dana-Farber Cancer Institute, Inc. and Dana-Farber, Inc. Calculation of Days of Unrestricted Cash on Hand ($ in thousands) (unaudited) September 30, March 31, Cash and Investment 1 $589,309 $612,918 $611,063 Average Operating Expenses per day 2 2,726 2,975 3,219 Days Unrestricted Cash on Hand Unrestricted cash equivalents and marketable securities, plus (in accordance with the applicable debt agreements) an amount equal to two hundred percent (200%) as of the last twelve months ended September 30, 2014 and 2015 and March 31, 2016 of the donor restricted research funds that have been released from restriction and used for operating expenses during the relevant calculation period, plus temporarily restricted cash and marketable securities that are available for current use, but excluding (i) all Trustee-held funds; (ii) collateral required to be posted by a Hedging Contract; (iii) borrowed moneys payable in one year or less, unless there exists a firm refinancing commitment from a qualified financial institution rated at least A ; (iv) any demand obligations, unless a liquidity facility with term-out provisions of one year or more exists from a qualified financial institution rated at least A+ or A1 ; and (v) borrowed funds that are pledged to a lender. Total operating expenses of the Institution (excluding extraordinary items, depreciation and amortization and other non-cash charges) divided by the number of days in the period. Historical and Pro Forma Coverage of Debt Service The following table sets forth for the twelve months ended September 30, 2015 and 2014, the income of the Institution available to pay its debt service (calculated as set forth in the Master Trust Indenture) and the extent to which such income covered annual historical debt service requirements on the actual long-term indebtedness of the Institution outstanding during the period. The table also indicates the extent to which such income available for debt service would provide coverage of pro forma maximum annual debt service requirements of long-term indebtedness after giving effect to the issuance of the Series N Bonds. There can be no assurance that the Institution will generate income available for debt service in future years comparable to historical performance. Dana-Farber Cancer Institute, Inc. and Dana-Farber, Inc. Historical and Pro Forma Debt Service Coverage ($ in thousands) Twelve Months Ended September 30, Income Available for Debt Service 1 $100,209 $123,425 Historical Annual Debt Service 2 $17,256 $18,807 Historical Annual Debt Service Coverage Ratio Historical Maximum Annual Debt Service 3 $23,895 $23,895 Historical Maximum Annual Debt Service Coverage Ratio Pro Forma Maximum Annual Debt Service $35,550 $35,550 Pro Forma Maximum Annual Debt Service Coverage Ratio With respect to each Member of the Obligated Group, as to any period of time, Income Available for Debt Service, as defined in the Master Trust Indenture (which permits certain assumptions concerning the smoothing level of the Institution's investment income over multiple years). See Appendix C-1 DEFINITIONS OF CERTAIN TERMS OF THE MASTER TRUST INDENTURE. Calculated in accordance with the terms of the Master Trust Indenture. Includes payments on Long-Term Indebtedness and net interest paid on Swap Agreements. 13

18 3 Total Debt Service Requirements on Long-Term Indebtedness is calculated in accordance with the terms of the Master Trust Indenture. Series M Balloon Indebtedness is amortized for level debt service at an interest rate of 5.353% per annum. Interest on variable rate Indebtedness which is not subject to a Hedging Contract is calculated at the average interest rate for the preceding twelve months. For the unhedged portion of the Series L-1 Bonds, Series L-2A Bonds, and Series L-2B Bonds (collectively, Series L Bonds ) this equals 0.9%, 1.8%, and 0.9% per annum, respectively, as of March 31, Interest on variable rate Indebtedness which is subject to a Hedging Contract is calculated at the rate payable on the Hedging Contract plus amounts required to be paid as a result of the differential between the rate received pursuant to the Hedging Contract and the rate required to be paid on the variable rate Indebtedness. For the hedged portions of the Series L-1 Bonds, Series L-2A Bonds, and Series L-2B Bonds this equals 4.6%, 5.5%, and 4.6% per annum, respectively, as of March 31, THE PLAN OF FINANCE The proceeds from the sale of the Series N Bonds will be used as follows: (i) a portion of the total cost of the acquisition of approximately 203,000 RSF and fit-out of condominiums and approximately 50,983 RSF of leased space located at 360 Longwood Avenue to be used solely for biomedical research, including wet laboratories and associated research administration and support space, and for the replacement of the Institution s existing mouse vivaria (animal research facilities) and fit-out of a consolidated state-of-the art mouse vivarium, with approximately $81 million of such cost to be funded from other moneys of the Institution; (ii) approximately $4.7 million of the $8.6 million total cost of replacing a roughly 20 year-old HVAC system in the Smith Building, with amounts in excess of $4.7 million to be funded from operations as routine capital expenditures; (iii) the relocation to, reconstruction and equipping of the Institution s Cell Manipulation Core Facility; and (iv) other uses including payment of the costs of issuance of the Series N Bonds and interest during the purchase and construction periods, and various other capital projects. ESTIMATED APPLICATION OF SERIES N BOND PROCEEDS The estimated sources and uses of the proceeds of the Series N Bonds are expected to be as follows (rounded to the nearest dollar): Sources of Funds Amount Principal Amount of the Series N Bonds $233,195,000 Net Original Issue Premium 48,591,480 Total $281,786,480 Uses of Funds Costs of Project $265,046,950 Capitalized Interest 14,252,829 Costs of Issuance (including underwriter s discount) 2,486,701 Total $281,786,480 THE MORTGAGED PROPERTY Pursuant to the Master Trust Indenture, a mortgage has been granted upon the Institution s Richard A. and Susan F. Smith Research Laboratories, Dana Building, Louis B. Mayer Research Laboratories and the Yawkey Center for Cancer Care, comprising approximately 1.95 acres located in Boston, Massachusetts. For a description of such properties, see Appendix A LETTER FROM DANA-FARBER CANCER INSTITUTE, INC. AND DANA- FARBER, INC. FACILITIES MANAGEMENT. The mortgage will secure all Indenture Indebtedness issued under the Master Trust Indenture on a parity and certain obligations relating to the 2007 Swap Agreements. The value of the Mortgaged Property as security for existing obligations has not been established by appraisal or otherwise and could be diluted by the incurrence of Additional Indebtedness. See BONDOWNERS RISKS AND MATTERS AFFECTING THE HEALTH CARE INDUSTRY Realization of Value on Mortgaged Property. The Institution may release, sell, encumber, lease or subordinate the Lien on the Mortgaged Property as more fully described in Appendix C-2 to this Official Statement, SUMMARY OF CERTAIN PROVISIONS OF THE MASTER TRUST INDENTURE Substitution and Release of Mortgaged Property and Limitations on Creation of Liens. The property purchased with the Series N Bonds will not be subject to the Mortgage. 14

19 CONTINUING DISCLOSURE No financial or operating data concerning the Issuer is material to any decision to purchase, hold or sell the Series N Bonds and the Issuer will not provide any such information. The Institution and the Dissemination Agent (as defined in the Continuing Disclosure Agreement described below) have undertaken all responsibilities for any continuing disclosure to Bondowners as described below, and the Issuer shall have no liability to the Bondowners or any other person with respect to such disclosures. The Institution has covenanted for the benefit of the Bondowners to provide certain financial information and operating data relating to the Institution not later than 150 days following the end of the Institution s fiscal year beginning with fiscal year ending September 30, 2016 (the Annual Report ) and by not later than 75 days after each of the first three fiscal quarters beginning with fiscal quarter ending June 30, 2016 (the Quarterly Statements ), and to provide notices of the occurrence of certain enumerated events. The Annual Report and the Quarterly Statements will be filed on behalf of the Institution with the Municipal Securities Rulemaking Board (the MSRB ) through its Electronic Municipal Market Access ( EMMA ) system. The event notices will be filed on behalf of the Institution with the MSRB through its EMMA system. The specific nature of the information to be contained in the Annual Report and the Quarterly Statements or the notices of significant events is summarized in Appendix E FORM OF CONTINUING DISCLOSURE AGREEMENT. These covenants have been made in order to assist the Underwriter in complying with Rule 15c2-12 promulgated by the Securities and Exchange Commission. Failure to comply with these covenants is not an Event of Default under the Agreement or the Master Trust Indenture. The quarterly reports filed by the Institution for the fiscal quarters ended December 31, 2010 through March 31, 2013 and the annual reports filed by the Institution for the fiscal years ended September 30, 2011 and September 30, 2012 under existing continuing disclosure agreements were filed in a timely manner but failed to include a table titled Dana-Farber Cancer Institute Investment Performance Summary Return on Investment. The Institution has recently provided this information through the filing of a supplemental notice on the EMMA system. In the five years preceding the date of this Official Statement, the Institution has otherwise complied in all material respects with its continuing disclosure agreements. In General BONDOWNERS RISKS AND MATTERS AFFECTING THE HEALTH CARE INDUSTRY There are risks associated with the purchase of the Series N Bonds. The principal and redemption price of and interest on the Series N Bonds are payable solely from the amounts paid by the Institution to the Issuer under the Agreement from amounts which may be paid to the Trustee pursuant to the Master Trust Indenture, including moneys paid by the Institution under Obligation No. 12. No representation or assurance can be made that revenues will be realized by the Institution in the amounts necessary to make payments at the times and in the amounts sufficient to pay the debt service on the Series N Bonds. THE FOLLOWING DISCUSSION OF RISK FACTORS IS NOT, AND IS NOT INTENDED TO BE, EXHAUSTIVE. Future revenues and expenses will be affected by events and conditions relating generally to, among other things, demand for DFCI s services, the ability of DFCI to provide the services required by patients, physicians relationships with the Institution, management capabilities, the design and success of the Institution s strategic plans, economic developments in the Institution s service area, the Institution s ability to control expenses, maintenance of the Institution s relationships with health maintenance organizations and other payers, competition, rates, costs, third-party payments, legislation, and governmental regulation. Third-party payment and charge-control statutes and regulations are likely to change, and unanticipated events and circumstances may occur which cause variations from the Institution s expectations, and the variations may be material. Enforceability of Lien on Gross Receipts The Agreement provides that the Institution shall make payments to the Trustee sufficient to pay the Series N Bonds and the interest thereon as the same become due. The obligation of the Institution to make such payments is secured by Obligation No. 12 issued under the Master Trust Indenture which, in turn, is secured by a security interest granted to the Master Trustee in the Gross Receipts of each of DFCI and DFI and a mortgage on the Mortgaged Property granted to the Master Trustee. 15

20 To the extent that Gross Receipts are derived from payments by the federal or state government under the Medicare or Medicaid program, any right to receive such payments directly may be unenforceable. The Social Security Act and state regulations prohibit anyone other than the individual receiving care or the institution providing service from collecting Medicare and Medicaid payments directly from the federal or state government. In addition, Medicare and Medicaid receivables may be subject to provisions of the Assignment of Claims Act of 1940, which restricts the ability of a secured party to collect accounts directly from government agencies. With respect to receivables and Gross Receipts not subject to the lien, the Master Trustee would occupy the position of an unsecured creditor. Counsel to the Institution has not provided an opinion with regard to the enforceability of the lien on Gross Receipts of the Institution, where such Gross Receipts are derived from the Medicare and Medicaid programs. In the event of bankruptcy of DFCI or DFI, transfers of property by the bankrupt entity, including the payment of debt or the transfer of any collateral, including receivables and Gross Receipts on or after the date which is 90 days (or, in some circumstances, one year) prior to the commencement of the case in bankruptcy court, may be subject to avoidance or recoupment as preferential transfers. Under certain circumstances a court may have the power to direct the use of Gross Receipts to meet expenses of the DFCI or DFI before paying debt service on the Series N Bonds. Pursuant to the Massachusetts Uniform Commercial Code, a security interest in the proceeds of Gross Receipts may not continue to be perfected if such proceeds are not paid over to the Master Trustee by DFCI or DFI, as applicable, under certain circumstances. If any required payment is not made when due, DFCI or DFI must transfer or pay over immediately to the Master Trustee any Gross Receipts with respect to which the security interest remains perfected pursuant to law. Any Gross Receipts thereafter received shall upon receipt by DFCI or DFI be transferred to the Master Trustee without such Gross Receipts being commingled with other funds, in the form received (with necessary endorsements) up to an amount equal to the amount of the missed payment. The value of the security interest in the Gross Receipts could be diluted by the incurrence of Additional Indebtedness secured equally and ratably with Obligation No. 12, the Series N Bonds, the Series K Bonds, the Series L Bonds, the Series M Bonds, the 2007 Swap Agreements and future Hedging Contracts as to the security interest in the Gross Receipts or by the issuance of debt secured on a basis senior to the Series N Bonds. See ADDITIONAL INDEBTEDNESS ON A PARITY WITH THE SERIES N BONDS herein and Appendix C-2 SUMMARY OF CERTAIN PROVISIONS OF THE MASTER TRUST INDENTURE Limitations on Incurrence of Additional Indebtedness hereto. Enforceability of Master Trust Indenture and the Agreement Under Massachusetts law, a nonprofit corporation may guarantee the debt of another corporation only if such guaranty is in furtherance of the corporate purposes of such guarantor nonprofit corporation. In addition, it is possible that the security interest granted by a Member of the Obligated Group and the joint and several obligation of a Member of the Obligated Group to make payments due under an obligation, including Obligation No. 12, relating to bonds issued for the benefit of another Member of the Obligated Group, may be declared void in an action brought by third-party creditors pursuant to the Massachusetts fraudulent conveyance statutes or may be avoided by a Member of the Obligated Group or a trustee in bankruptcy in the event of the bankruptcy of the Member from which payment is requested. An obligation may be voided under the federal Bankruptcy Code or under the Massachusetts fraudulent conveyance statute, if (a) the obligation was incurred without receipt by the obligor of fair consideration or reasonably equivalent value, and (b) the obligation renders the obligor insolvent, as such terms are defined under the applicable statute. Interpretation by the courts of the tests of insolvency, reasonably equivalent value and fair consideration has resulted in a conflicting body of case law. For example, a Member s joint and several obligation under the Agreement to make all payments thereunder, including payments in respect of funds used for the benefit of the other Members, may be held to be a transfer which makes such Member insolvent in the sense that the total amount due under the Agreement could be considered as causing its liabilities to exceed its assets. Also, one of the Members may be deemed to have received less than fair consideration for such obligation because none or only a portion of the proceeds of the indebtedness are to be used to finance projects occupied or used by such Member. While the Members may benefit generally from the projects financed from the indebtedness for the other Members, the actual cash value of this benefit may be less than the joint and several obligation. The rights under the Massachusetts fraudulent conveyance statutes may be 16