Bubae
7 hours ago
Hate to spoil the emotional fervor here with some facts but I believe the walls are finally closing in on Shawn Leon and company which is why I believe they have worked this up this month. The problem they have is that this move in price really hasn't done much for many because of the lack of volume. This isn't a good narrative, retail driven runup. The company added pile on the new debt for this new narrative and you have to wonder how they intend to service it let alone pay any of it. Not much new either since they have been trying to buy the current Evernia Treatment Center since the summer of 2021.
This time last year the company refinanced $2.3 million of mostly defaulted debt into a refinance operating lease deal representing a current liability of more than $9 million. This deal required personal guarantee contracts by both Shawn Leon and his wife Eileen Greene. Last year they were paying nothing on that defaulted debt and this year in the Q1 we see that they must pay on it now. Looking at a Q1 2024 cash burn increase of $150K a quarter just for the new rent expense alone.
After the lease refinance deal of 2023 the company immediately started adding more debt. Bauman note August 9th 2023, Mirage Realty note November 15th 2023. The balance on the Bauman note as of March 31st 2024 was $124,769 and can convert at any time with an automatic conversion feature date of August 9th. The third third extension on the $250K Mirage Realty note expired on June 15th.
Revolving credit line of $1 million dated February 1st limited to 80% of receivables. They define receivables in the agreement that can be found in the 8K filed February 7th. They could have this line tapped out? On page 9 of the Q1 2024 filing we see the statement "...The Company’s receivables were $356,929 and $313,338 at March 31, 2024 and December 31, 2023, respectively..." They executed draws in May totaling total of $450K on the credit line. This credit line includes fees with each draw and earns interest at 60% APR. Credit line is "...secured by all assets, tangible and intangible of the Company..."
$1.2 million in new bridge loans, one of which dated May 15, 2024 for $600K matures November 15th 2024.This note has some nasty default terms including converting into shares of the Evernia Treatment center held by ATHI for essentially the 25% they just claimed to have purchased for $1.1 million.
They have just finalized the Boca deal and according to the May 17th press release they had $300K lined up for this. We won't know the terms and where that money came from until we see the Q2 but judging from the other finance deals so far for 2024... 🙄
Ethema Health has had Series N convertible notes in default since 2022. The chart on page 16 of the Q1 2024 filing shows an outstanding balance of $4,276,463. There is a note on page 17 about a new agreement extending the maturity dates to December 31, 2024. What is the plan for the rest of the year to deal with this you might wonder.
Page 24 of the Q1 2024 filing we see a newly created group of "Series R Senior secured promissory notes" introduced. It is a pretty convolutes section describing series "N" note exchanges and accrued interest of those notes being paid from proceeds. This section appears to represent the other half of the $1.2 million in bridge loans.
This is my list supported by the links to the filings but it likely doesn't represent all the new debt. Just what I have been able to dig up. Shawn Leon has been busy lining up some expensive short term patch loans. Now what? How long can he go on without the benefit of raising cash from the equity represented by the Ethema Health (GRST) Share structure?
Bubae
Re: Penny Stocks 2.0 post# 50234
Saturday, June 29, 2024 7:29:14 PM
Post# 50236 of 50339
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=174680928&txt2find=net%2Bloss
Rent expense was $265,132 and $114,564 for the three months ended March 31, 2024 and 2023, respectively, an increase of $150,568 or 131.4%.The increase is primarily due to an increase in rental which arose on the acquisition of the building from our landlord and the immediate disposal of the building to a third party on August 4, 2023,...Bubae
Re: Think1st post# 50209
Friday, June 28, 2024 7:44:10 PM
Post# 50216 of 50340
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=174677602
The balance on the Bauman note as of March 31st was $124,769 and can convert at any time and the third extension on the $250K Mirage Realty note was June 15th.Bubae
Re: None
Friday, June 07, 2024 9:07:49 PM
Post# 49945 of 50339
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=174565220
According to the chart on page 17 of the quarterly the company took three draws on May 1st, 12th, and 14th totaling $320K. Then again in the subsequent events section we see another draw of $130,000 on May 15th for a total of $450K drawn on the credit line in May.The revolving credit line is secured by all assets, tangible and intangible of the Company and its direct and indirect subsidiaries, American Treatment Holdings, Inc. and Evernia Health Center, LLC.Bubae
Re: None
Sunday, June 16, 2024 2:43:59 PM
Post# 50049 of 50340
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=174608088
...gross proceeds of $600,000, maturing on November 15, 2024...
...default interest at a maximum of 24% per month...
...The Senior Note, upon an event of default, may be converted into shares of ATHI at the rate of 1% of ATHI for each $24,000 of indebtedness, capped at $633,000...Ethema Acquires 25% Minority Stake in ARIA Subsidiary
NewMediaWire
Fri, May 17, 2024
https://finance.yahoo.com/news/ethema-acquires-25-minority-stake-134910442.html
The Company has raised $1,200,000 in bridge loan funding to date and lined up an additional $300,000 to fund the expansion into the Boca Raton location when that is finalized.For the quarterly period ended March 31, 2024
https://www.sec.gov/ix?doc=/Archives/edgar/data/0000792935/000190359624000371/grst_10q.htm
Page 17
Series N convertible notes
The maturity dates of the Series N convertible notes were extended to December 31, 2024, with the exception of 5 series N convertible notes issued to one investor with an aggregate principal outstanding of $1,273,000, which was extended to December 31, 2025. No consideration was provided to the investors for the maturity date extensions.
Page 24
17. Subsequent events
Series R Senior secured promissory notes
The company entered into the Series R senior secured promissory notes (“Series R Notes”), as detailed below,...
loanshark007
10 hours ago
Auctus Fund, LLC , Joshua Bauman , Series N convertible notes , LXT Biotech... etc.
The Company’s unaudited condensed consolidated financial statements have been prepared in accordance with US GAAP applicable to a going concern, which assumes that the Company will be able to meet its obligations and continue its operations in the normal course of business. At March 31, 2024 the Company has a working capital deficiency of $8.2 million, and total liabilities in excess of assets in the amount of $6.6 million. Management believes that current available resources will not be sufficient to fund the Company’s planned expenditures over the next 12 months. These factors, individually and collectively indicate that a material uncertainty exists that raises substantial doubt about the Company's ability to continue as a going concern for one year from the date of issuance of these condensed interim consolidated financial statements.
The Company will be dependent upon the raising of additional capital through placement of common shares, and/or debt financing in order to implement its business plan and generating sufficient revenue in excess of costs. If the Company raises additional capital through the issuance of equity securities or securities convertible into equity, stockholders will experience dilution, and such securities may have rights, preferences or privileges senior to those of the holders of common stock or convertible senior notes. If the Company raises additional funds by issuing debt, the Company may be subject to limitations on its operations, through debt covenants or other restrictions. If the Company obtains additional funds through arrangements with collaborators or strategic partners, the Company may be required to relinquish its rights to certain geographical areas, or techniques that it might otherwise seek to retain. There is no assurance that the Company will be successful with future financing ventures, and the inability to secure such financing may have a material adverse effect on the Company’s financial condition. These unaudited condensed consolidated financial statements do not include any adjustments to the amounts and classifications of assets and liabilities that might be necessary should the Company be unable to continue as a going concern.
Bubae
1 day ago
My bet is that you couldn't move any of the pile that you are sitting on either. 😆 It doesn't look to me like retail is taking the bait here. Not much point in walking it up if there are no buyers. I see the walls closing in on this borrowing Ponzi scheme of Shawn's finally. It isn't often that you see an OTC company that is unable to raise capital or convert debt with their equity. This has been going on since March of 2022 and all they have been doing is finding new ways to refinance. Shawn Leon may have to step up and guarantee another refinance scheme. Better hope that he can do better than the one last year. It isn't often that you see a company turn $2.3 million in defaulted debt into more than $9 million in long term liability. 19 million if it goes the full 20 years. Good luck converting that Bauman note. They would probably like to convert that in a controlled manner rather than see the automatic conversion feature kick in on August 9th. Can't say that I ever saw a note with an automatic conversion feature. Wonder why the lender wanted that provision? 🤔
For the quarterly period ended March 31, 2024
https://www.sec.gov/ix?doc=/Archives/edgar/data/0000792935/000190359624000371/grst_10q.htm
Page 17
8. Short-term Convertible Notes (continued)
Joshua Bauman
On August 9, 2023, the Company issued a convertible promissory note to Bauman, in the aggregate principal amount of $150,000. The note bears interest at 10.0% per annum and matures on August 9, 2024. The note is convertible into shares of common stock at a conversion price at the option of the holder at $0.001 per share, adjusted for anti-dilution provisions. The note is convertible into common stock at the option of the holder after the expiration of six months from the issuance date, in addition, should the note reach its maturity date, August 9, 2024, the note will automatically convert into shares of common stock at the conversion price, subject to anti-dilution provisions.
Bubae
1 day ago
One thing for certain, this isn't a retail driven runup on this narrative. Since the June 11th volume of 92 million off the form 4 "error" the volume has been relatively light, as low as 25,000 shares traded on the 26th. As of May 2024 there were only 157 holders of this stock so most of you are two handled baggies. We are looking at an average of more than 23 million shares per holder. They aren't getting much of a bid build at each level so even if you guys want to unload some the buyers aren't there. Even today at one point the spread was from 6 to 8 with a zero bid a 7 despite painting a couple of trades at nine. So the inside buys are backstopping the low end and who knows who else is working it but fortunately for them there isn't much retail interest on the bid for potential sellers. You and the company may have price but you are stuck without volume.
This is a low volume walk up and we know now an insider is helping with the manipulation. Those form 4s have been delayed a week so expect more from what I see. I'm convinced that the reason for the walk up is to get the price as close to the Bauman note conversion price as possible as to reduce the effect the dilutive issuance will have on the Leonite warrants. Leonite holds warrants equal to 20% of the outstanding share count. I believe this is also the reason the company is reluctant to split the stock for the offering. Post split the offering will represent dilutive issuances because this debt story will again not drive volume to maintain price.
For the fiscal year ended: December 31, 2023
https://www.sec.gov/ix?doc=/Archives/edgar/data/0000792935/000190359624000279/grst_10k.htm
Page 4
The last reported sale price of our common stock on the OTC Pink on May 6, 2024 was $0.0003 per share. As of May 6, 2024, there were approximately 157 holders of record of our common stock.
Bubae
Re: declaes post# 50271
Sunday, June 30, 2024 6:35:43 PM
Post# 50272 of 50302
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=174683588
Another reason for the walk-up prior to the potential debt conversions is the effect that it would have on the warrant that Leonite holds that was renegotiated in June of 2023. Leonite is entitled to warrants totaling 20% of the outstanding shares count which is currently 745,810,761 shares. The basis price is $0.001 as it stands. However, if there is a dilutive issuance that price resets to the price of the dilution and shares are once again added to the warrant to the tune of 20% of the newly issued dilutive shares. The anti dilution language is on page 15 of the warrant exchange agreement linked below. I used the windows magnifier to view the document.
Trade like a pro: Leverage real-time discussions and market-moving ideas to outperform.
Penny Stocks 2.0
8 hours ago
GRSTMILL
10 hours ago
Stepbro69
10 hours ago
declaes
10 hours ago
brucebill
15 hours ago
Italia77
18 hours ago
Hot Features
Premium
