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Ethema signs binding asset purchase agreement for all of the business assets of Edgewater Recovery Center LLC

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Ethema Health (OTCPINK: GRST) has signed a binding Asset Purchase Agreement to acquire the business operations and operational assets of Edgewater Recovery Center, (ERC) in Kentucky. The transaction excludes real property and requires various consents. ERC has been managed by Ethema since July 15, 2024, and will continue operations until ARIA Kentucky, a new subsidiary, is fully licensed and accredited.

The current ERC patient census is approximately 195 patients, with expectations of significant growth. Ethema plans to add 16 beds in October at the Paducah location. ARIA Kentucky will primarily serve Medicaid-insured clients, with potential for expansion due to ongoing investigations into other Medicaid providers in the state.

The real property associated with ERC operations will be acquired separately by a fund controlled by Ethema's CEO, Shawn Leon, and leased to ARIA Kentucky at market rates.

Ethema Health (OTCPINK: GRST) ha firmato un contratto vincolante di acquisto di attivi per acquisire le operazioni commerciali e gli attivi operativi del Edgewater Recovery Center (ERC) nel Kentucky. La transazione esclude la proprietà reale e richiede vari consensi. L'ERC è stata gestita da Ethema dal 15 luglio 2024 e continuerà le operazioni fino a quando ARIA Kentucky, una nuova filiale, non sarà completamente licenziata e accreditata.

Il numero attuale di pazienti dell'ERC è di circa 195 pazienti, con aspettative di crescita significativa. Ethema prevede di aggiungere 16 letti a ottobre nella location di Paducah. ARIA Kentucky servirà principalmente clienti assicurati da Medicaid, con potenziali espansioni a causa di indagini in corso su altri fornitori di Medicaid nello stato.

La proprietà reale associata alle operazioni dell'ERC sarà acquisita separatamente da un fondo controllato dal CEO di Ethema, Shawn Leon, e affittata ad ARIA Kentucky a tariffe di mercato.

Ethema Health (OTCPINK: GRST) ha firmado un acuerdo vinculante de compra de activos para adquirir las operaciones comerciales y los activos operativos del Edgewater Recovery Center (ERC) en Kentucky. La transacción excluye la propiedad real y requiere varios consentimientos. ERC ha sido gestionado por Ethema desde el 15 de julio de 2024 y continuará sus operaciones hasta que ARIA Kentucky, una nueva filial, esté completamente licenciada y acreditada.

El censo actual de pacientes de ERC es de aproximadamente 195 pacientes, con expectativas de un crecimiento significativo. Ethema planea agregar 16 camas en octubre en la ubicación de Paducah. ARIA Kentucky servirá principalmente a clientes asegurados por Medicaid, con potencial de expansión debido a investigaciones en curso sobre otros proveedores de Medicaid en el estado.

La propiedad real asociada a las operaciones de ERC será adquirida por separado por un fondo controlado por el CEO de Ethema, Shawn Leon, y alquilada a ARIA Kentucky a tarifas de mercado.

Ethema Health (OTCPINK: GRST)는 켄터키에 있는 Edgewater Recovery Center(ERC)의 사업 운영 및 운영 자산을 인수하기 위한 구속력 있는 자산 구매 계약을 체결했습니다. 이 거래는 부동산을 제외하며 다양한 동의를 필요로 합니다. ERC는 2024년 7월 15일부터 Ethema에 의해 관리되고 있으며 ARIA Kentucky라는 새로운 자회사가 완전히 면허를 받고 인증될 때까지 운영을 지속합니다.

현재 ERC의 환자 수는 약 195명으로, 상당한 성장 기대가 있습니다. Ethema는 10월에 Paducah 지점에 16개의 침대를 추가할 계획입니다. ARIA Kentucky는 주로 Medicaid 보험 가입자를 대상으로 서비스를 제공하며, 주 내 다른 Medicaid 공급자에 대한 진행 중인 조사로 인한 확장 가능성이 있습니다.

ERC 운영과 관련된 부동산은 Ethema의 CEO인 Shawn Leon이 통제하는 펀드에 의해 별도로 인수되며, ARIA Kentucky에 시장 가격으로 임대될 것입니다.

Ethema Health (OTCPINK: GRST) a signé un accord d'achat d'actifs contraignant pour acquérir les opérations commerciales et les actifs opérationnels du Edgewater Recovery Center (ERC) dans le Kentucky. La transaction exclut les biens immobiliers et nécessite divers consentements. L'ERC est géré par Ethema depuis le 15 juillet 2024 et continuera ses opérations jusqu'à ce qu'ARIA Kentucky, une nouvelle filiale, soit entièrement licenciée et accréditée.

Le nombre actuel de patients de l'ERC est d'environ 195 patients, avec des attentes de croissance significative. Ethema prévoit d'ajouter 16 lits en octobre à l'emplacement de Paducah. ARIA Kentucky servira principalement des clients assurés par Medicaid, avec un potentiel d'expansion en raison d'enquêtes en cours sur d'autres fournisseurs de Medicaid dans l'état.

Les biens immobiliers associés aux opérations de l'ERC seront acquis séparément par un fonds contrôlé par le PDG d'Ethema, Shawn Leon, et loués à ARIA Kentucky à des tarifs de marché.

Ethema Health (OTCPINK: GRST) hat einen verbindlichen Kaufvertrag über Vermögenswerte unterzeichnet, um die Geschäftstätigkeiten und Betriebsmittel des Edgewater Recovery Centers (ERC) in Kentucky zu erwerben. Die Transaktion schließt Immobilien aus und erfordert verschiedene Zustimmungen. Das ERC wird seit dem 15. Juli 2024 von Ethema geleitet und wird die Dienstleistungen fortsetzen, bis ARIA Kentucky, eine neue Tochtergesellschaft, vollständig lizenziert und akkreditiert ist.

Die aktuelle Patientenzahl des ERC beträgt etwa 195 Patienten, mit Erwartungen an ein signifikantes Wachstum. Ethema plant, im Oktober 16 Betten am Standort Paducah hinzuzufügen. ARIA Kentucky wird hauptsächlich Medicaid-versicherte Klienten bedienen, mit Potenzial für Expansion aufgrund laufender Untersuchungen zu anderen Medicaid-Anbietern im Bundesstaat.

Die mit den ERC-Betrieb verbundenen Immobilien werden separat von einem Fonds erworben, der vom CEO von Ethema, Shawn Leon, kontrolliert wird, und zu Marktpreisen an ARIA Kentucky vermietet.

Positive
  • Binding Asset Purchase Agreement signed to acquire Edgewater Recovery Center's business operations
  • Current patient census of approximately 195, with expectations of significant growth
  • Plans to add 16 beds in October at the Paducah location
  • Potential for expansion due to ongoing investigations into other Medicaid providers in Kentucky
  • ERC operations stabilized and cash flow positive over the last three months
Negative
  • Transaction requires multiple consents from government agencies, managed care organizations, lenders, and creditors
  • Real property acquisition involves a related party transaction with the CEO's fund

WEST PALM BEACH, Fla., Oct. 22, 2024 /PRNewswire/ -- Ethema Health Corporation (OTCPINK: GRST) ("Ethema" "GRST" or the "Company"), has signed a binding Asset Purchase Agreement ("APA") to purchase the business operations and operational assets, excluding any real property of Edgewater Recovery Center, LLC ("ERC") headquartered in Morehead Kentucky. ERC operates primarily in the urban areas of Morehead in eastern Kentucky and Paducah in western Kentucky. The closing of the APA requires consents from multiple government agencies, managed care organizations, lenders and creditors of certain liabilities being assumed in the transaction. 

ERC has been managed by the Company since July 15, 2024 and will continue to be managed until such time as the newly created, wholly owned subsidiary of the Company, ARIA Kentucky, LLC ("ARIA Kentucky") is fully licensed, accredited and contracted with the managed care organizations, whereupon the operations of ERC will cease. ERC will continue to generate revenues from servicing clients during the transition period. The existing interim management of ERC will be continued by ARIA Kentucky and all operations will be conducted under the Addiction Recovery Institute of America ("ARIA") Brand.

The current ERC patient census in Kentucky is approximately 195 patients which the Company believes, that with the conclusion of the binding APA, will increase dramatically in the near term. The Ethema management team has stabilized the ERC operations over the last three months and is cash flow positive. The Company intends to add another 16 beds in October at the Paducah location, which has been operating at full capacity, increasing revenue in this underserved market.

ERC and after the closing of the transaction, ARIA Kentucky, primarily provides care to Medicaid insured clients. There is currently on-going investigations into other Medicaid providers in Kentucky, which, we believe, will reduce the number of patients served by these providers, presenting ARIA Kentucky with an opportunity to further expand its footprint and revenue potential in Kentucky. To learn more about the operations of ARIA Kentucky please call 606-462-3001.

Certain of the Real Property associated with the operations of ERC are fully levered and requires credit and personal guarantees which the Company is unable to provide. This Real Property is to be acquired in a separate transaction by a fund controlled by the CEO of the Company, Shawn Leon, a related party, and will be leased to ARIA Kentucky on an arms-length basis, at market related rates.

Mr. Leon, Company CEO reported, "It has been an honor to work with a dedicated team of professionals these last three months, and I can confidently say that this team operates at the highest level of integrity and provides a very effective program that continues to serve the needs of Kentuckians ravaged by the opioid epidemic. We aim to continue providing highly effective services at the highest integrity level and look forward to becoming the provider of choice in the State of Kentucky. Although the industry is experiencing tenuous times for Medicaid providers in the Behavioral Health space due to the misdeeds of certain bad actors, we believe that Kentucky Medicaid and the managed care organizations will recognize the integrity of our organization and trust us to provide effective care for the large number of Kentuckians suffering from substance use disorder."

About Ethema Health Corporation

Ethema Health Corporation (OTCPINK: GRST) operates in the behavioral healthcare space specifically 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
shawn@ethemahealth.com
Text to 416-500-0020
Twitter @healthethema

Cision View original content:https://www.prnewswire.com/news-releases/ethema-signs-binding-asset-purchase-agreement-for-all-of-the-business-assets-of-edgewater-recovery-center-llc-302283593.html

SOURCE Ethema Health Corporation

FAQ

What is the significance of Ethema Health (GRST) signing the Asset Purchase Agreement with Edgewater Recovery Center?

The binding Asset Purchase Agreement allows Ethema to acquire ERC's business operations and operational assets in Kentucky, expanding its presence in the addiction treatment market and potentially increasing its patient base and revenue.

How many patients does Edgewater Recovery Center currently serve in Kentucky?

Edgewater Recovery Center currently has a patient census of approximately 195 patients in Kentucky.

What are Ethema's (GRST) expansion plans for the Paducah location?

Ethema plans to add 16 beds in October at the Paducah location, which has been operating at full capacity, to increase revenue in this underserved market.

How will the real property associated with ERC operations be handled in the Ethema (GRST) transaction?

The real property will be acquired separately by a fund controlled by Ethema's CEO, Shawn Leon, and leased to ARIA Kentucky, a subsidiary of Ethema, at market-related rates.

What type of insurance does ARIA Kentucky primarily serve?

ARIA Kentucky primarily provides care to Medicaid-insured clients in Kentucky.

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