Healthy Choice Wellness Corp. Strengthens Balance Sheet Through Market Price Debt-for-Equity Conversion

Rhea-AI Summary

Healthy Choice Wellness Corp. (NYSE-AM: HCWC) has announced a significant financial development where existing lenders have converted $500,000 of outstanding debt into Class A common stock at current market price, without discounts or warrants. This strategic move strengthens the company's balance sheet and reduces its debt burden.

HCWC operates as a holding company focused on providing healthier lifestyle alternatives through multiple wholly-owned subsidiaries including:

• Ada's Natural Market
• Paradise Health & Nutrition (3 stores)
• Mother Earth's Storehouse
• Greens Natural Foods (8 stores in NY and NJ)
• Ellwood Thompson's
• GreenAcres Market (5 stores in Kansas and Oklahoma)

The company also maintains an e-commerce presence through Healthy U Wholesale, selling vitamins, supplements, and health products via TheVitaminStore.com.

Positive

• Debt reduction of $500,000 through equity conversion
• Conversion at market price without discounts or warrants indicates lender confidence
• Improved balance sheet flexibility for strategic initiatives
• Extensive retail presence with multiple store locations across different states

Negative

• Potential shareholder dilution from debt-to-equity conversion

Insights

Financial Analyst

This debt-to-equity conversion represents a strategic financial restructuring that materially improves HCWC's balance sheet position. The conversion of $500,000 in debt to equity at market price—without discounts or warrants—is particularly significant for a micro-cap company with a $4 million market capitalization.

The transaction effectively deleverages the company by removing 12.4% of its market cap equivalent in debt obligations. This improved capital structure provides three key benefits: reduced interest expenses that will flow directly to the bottom line, enhanced borrowing capacity for future growth initiatives, and elimination of potential covenant restrictions that might have operational flexibility.

The terms of the conversion reveal important positive signals. First, the lenders' willingness to accept equity at market price without demanding the typical 15-20% discount suggests strong confidence in HCWC's future prospects. Second, the absence of warrants means existing shareholders avoid future dilution that typically accompanies distressed conversions.

The CEO's statement that lenders have "once again" converted debt indicates this is part of an ongoing balance sheet improvement strategy rather than a one-time event. For a company operating in the competitive natural foods retail space, where margins are typically thin, reducing financial leverage is particularly valuable as it allows management to focus on operational improvements rather than debt service.

While the conversion does create some dilution for existing shareholders, the financial flexibility gained and the positive signal of lender confidence outweigh these concerns, making this a net positive development for HCWC's investment outlook.

HOLLYWOOD, FL, April 07, 2025 (GLOBE NEWSWIRE) -- -- Healthy Choice Wellness Corp. (NYSE-AM: HCWC) today announced that existing lenders have converted $500,000 of outstanding debt into shares of the Company's Class A common stock. This transaction strengthens the Company's balance sheet and reduces its debt burden.

Jeffrey Holman, Chief Executive Officer of HCWC, said, “We are pleased that lenders have once again shown confidence in HCWC by converting debt to equity at the current market price, without discounts or warrants. This conversion strengthens our balance sheet and supports our growth and success."

He added, "The additional $500,000 debt conversion further strengthens our financial position, providing us with greater flexibility to pursue strategic initiatives and enhance shareholder value. This move underscores the trust and support of our lenders, and we remain committed to driving sustainable growth and achieving our long-term objectives."

About Healthy Choice Wellness Corp.
Healthy Choice Wellness Corp. is a holding company focused on providing consumers with healthier daily choices with respect to nutrition and other lifestyle alternatives. 

Through its wholly owned subsidiaries, the Company operates:

		Ada’s Natural Market, a natural and organic grocery store offering fresh produce, bulk foods, vitamins and supplements, packaged groceries, meat and seafood, deli, baked goods, dairy products, frozen foods, health & beauty products and natural household items (www.Adasmarket.com).
		Paradise Health & Nutrition’s three stores that likewise offer fresh produce, bulk foods, vitamins, and supplements, packaged groceries, meat and seafood, deli, baked goods, dairy products, frozen foods, health & beauty products and natural household items (www.ParadiseHealthDirect.com).
		Mother Earth’s Storehouse, an organic and health food and vitamin store in New York’s Hudson Valley, which has been in existence for over 40 years (www.MotherEarthStorehouse.com).
		Greens Natural Foods’ eight stores in New York and New Jersey, offering a selection of 100% organic produce and all-natural, non-GMO groceries and bulk foods; a wide selection of local products; an organic juice and smoothie bar; a fresh foods department, which offers fresh and healthy “grab & go” foods; a full selection of vitamins & supplements; as well as health and beauty products. (www.Greensnaturalfoods.com).
		Ellwood Thompson’s, an organic and natural health food and vitamin store located in Richmond, Virginia (www.ellwoodthompsons.com).
		GreenAcres Market, an organic and natural health food and vitamin chain with five store locations in Kansas and Oklahoma. GreenAcres Market is a chain of premier natural foods stores, offering organic and all natural products and vitamins from both top national brands as well as locally sourced specialty brand (www.greenacres.com).

Through its wholly owned subsidiary, Healthy U Wholesale, the Company sells vitamins and supplements, as well as health, beauty and personal care products on its website www.TheVitaminStore.com.

Forward Looking Statements

This press release contains forward-looking statements within the meaning of that term in the Private Securities Litigation Reform Act of 1995 (Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934). Additional written or oral forward-looking statements may be made by the Company from time to time in filings with the Securities and Exchange Commission (SEC) or otherwise. Statements contained in this press release that are not historical facts are forward looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, and are based on management’s estimates, assumptions and projections and are not guarantees of future performance. The Company assumes no obligation to update these statements. Forward-looking statements may include, but are not limited to, projections or estimates of revenue, income, or loss, exit costs, cash flow needs and capital expenditures, statements regarding future operations. In addition, when used in this release, the words “anticipates,” “believes,” “estimates,” “expects,” “intends,” and “plans” and variations thereof and similar expressions are intended to identify forward looking statements. Factors that may affect our future results of operations and financial condition include, but are not limited to, fluctuations in demand for our products, the introduction of new products, our ability to maintain customer and strategic business relationships, the impact of competitive products and pricing, growth in targeted markets, the adequacy of our liquidity and financial strength to support its growth, and other information that may be detailed from time-to-time in our filings with the SEC.

Contact Information

Healthy Choice Wellness Corp.
3800 North 28th Way, Hollywood, FL 33020
305-600-5004
Email: ir@hcwc.com

FAQ

What is the impact of HCWC's $500,000 debt-to-equity conversion on its financial position?

The conversion strengthens HCWC's balance sheet by reducing debt burden and providing greater financial flexibility for strategic initiatives, with lenders converting at market price without discounts or warrants.

How many retail locations does HCWC currently operate across its subsidiaries?

HCWC operates multiple natural food stores through its subsidiaries, including 8 Greens Natural Foods stores, 5 GreenAcres Markets, 3 Paradise Health & Nutrition stores, and individual locations of Ada's, Mother Earth's, and Ellwood Thompson's.

What is HCWC's e-commerce strategy?

HCWC operates TheVitaminStore.com through its Healthy U Wholesale subsidiary, selling vitamins, supplements, health, beauty, and personal care products online.

What types of products are offered in HCWC's retail stores?

HCWC stores offer organic produce, bulk foods, vitamins, supplements, packaged groceries, meat, seafood, dairy, frozen foods, health & beauty products, and natural household items.