Ethema Repays a Significant Portion of Its Convertible Debt

Rhea-AI Summary

Ethema Health Corporation (OTCPINK: GRST) has made significant changes to its debt position, as detailed in an 8-K filed with the SEC. The company closed on a one-year convertible note of $550,000, utilizing proceeds to fully repay several convertible notes to lenders, thereby reducing potentially dilutive debt. CEO Shawn Leon expressed confidence in this move, highlighting a shift from variable to fixed-rate convertible debt. The repayments have decreased shareholder dilution considerably, enhancing the company’s financial stability.

Positive

• Closed a one-year convertible note for $550,000, improving debt position.
• Fully repaid multiple convertible notes, significantly reducing debt.
• Shift to fixed rate convertible debt reduces potential dilution for shareholders.

Negative

• None.

West Palm Beach, FL, May 17, 2021 (GLOBE NEWSWIRE) -- via NewMediaWire -- Ethema Health Corporation (OTCPINK: GRST) (“Ethema” “GRST” or the “Company”) is pleased to announce that the Company has made a substantial change to its debt position.  The details have been released in an 8-K filed today with the SEC.  At the end of April, payments on one of the Company’s convertible notes were due in addition to the expiration of the rights of repayment on several of the other convertible notes owed by the Company.  As part of the Company’s focus on dealing with its debt announced on April 28, 2021, the Company closed on a one-year convertible note in the face amount of $550,000.00 including an OID of 10% and a fixed conversion price of $0.005 per share.  The Company used the proceeds of the loan to repay three of its lenders notes completely.  The notes that were repaid were notes owed to Geneva Roth Remark Holdings in the face amount of $88,000 which required a payment of $119,449.27, FirstFire Global Opportunities Fund in the face amount of $138,888.89 which required a payment of $164,913.20, and Auctus Fund in the face amount of $100,000.00 which required a payment of $110,000.  An additional note due to Geneva Roth Remark Holdings in the face amount of $53,000.00 has a prepayment right that expires on May 24, 2021 and will also be repaid from the proceeds of the loan.  These repayments reduced substantially the amount of debt that would be converted into common stock and fixes the rate of conversion on the new loan so that dilution to the Company’s existing shareholders was brought down substantially.  A portion of the money due at the end of April was converted to restricted common stock and after repayment to one of the lenders that lender exercised its warrants.  The result of the conversions and exercise of warrants were far less dilutive than what was possible had the notes not been repaid.    

Mr. Shawn Leon, the CEO of the Company, stated, “We have dealt with a major portion of the potentially dilutive debt the Company was exposed to and eliminated a portion of the Warrants outstanding.   Replacing this dilutive debt with a fixed rate convertible debt was a major vote of confidence by one of our existing lenders.  The Company will continue its efforts to reduce or restructure the debt outstanding as a major priority of the Company as we strive to build value for our Shareholders.”  

About Ethema Health Corporation

Ethema Health Corporation (OTCPINK: GRST) operates in the behavioral healthcare space specifically in the treatment of substance use disorders. Ethema developed a unique style of treatment over the last decade and has had much success with in-patient treatment for adults. Ethema will continue to develop world-class programs and techniques for North America.  For more information you can visit our website at www.ethemahealth.com . 

Notice Regarding Forward-Looking Statements

The information contained herein includes forward-looking statements.  These statements relate to future events or to our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.  You should not place undue reliance on forward-looking statements since they involve known and unknown risks, uncertainties and other factors which are, in some cases, beyond our control and which could, and likely will, materially affect actual results, levels of activity, performance or achievements.  Any forward-looking statement reflects our current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to our operations, results of operations, growth strategy and liquidity.  We assume no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

For information please contact:

Ethema Health Corporation

Text to 416-500-0020

shawn@ethemahealth.com

Twitter @healthethema

FAQ

What recent financial changes did Ethema Health Corporation (GRST) announce?

Ethema announced a significant restructuring of its debt, closing a $550,000 convertible note and repaying several existing notes.

How has Ethema Health Corporation (GRST) dealt with its debt?

The company repaid a considerable portion of its convertible debt, reducing potential dilution for existing shareholders.

What impact does the recent debt restructuring have on GRST shareholders?

The debt restructuring has substantially lowered the potential dilution of shares, benefiting current shareholders.

When did Ethema Health Corporation (GRST) file its recent SEC report?

Ethema filed its 8-K report detailing the debt changes on May 17, 2021.

What is the face value of the convertible note secured by Ethema Health Corporation (GRST)?

The face value of the convertible note secured by Ethema is $550,000.