Ethema Signs Term Sheet for $275,000 Financing and Eliminates Major Debt with Convertible Note Conversion
WEST PALM BEACH, FL, Nov. 30, 2020 (GLOBE NEWSWIRE) -- via NewMediaWire – Ethema Health Corporation (OTCPINK: GRST) (“Ethema” “GRST” or the “Company”), is pleased to announce that the Company has signed a term sheet on November 24, 2020 with Labrys Fund LP for a 12% $275,000.00 loan that will provide the Company with a net of $239,050.00 after original interest discounts, legal fees and brokers fees. The loan is repayable in 10 equal monthly payments of $30,800 commencing February 26, 2021. The loan will have full warrant coverage. The warrants will have a term of 5 years and will allow for the purchase of 183,333,333 shares at a price of $.0015 per share.
On November 25, 2020, the Company received a conversion notice (“Notice”) from Labrys Fund LP (“Labrys”) pursuant to the Labrys July 8, 2019 convertible note (“Note”). The Notice was for a conversion of the original principal outstanding under the Note prior to the May 15, 2020 amendment to the Note requiring the Company to pay a reduced principal amount of the Note back in monthly cash installments. The Notice was an at-the-market conversion with a conversion price of $0.0028. The conversion is a one-time conversion that fully satisfies that balance of the Note in excess of $255,000. There was a total of 91,421,457 shares issued under the conversion.
The Company CEO, Shawn Leon, stated, “With these two events, the Company has positively impacted cash flow over the next three months by over $325,000.00. This comes at a critical time and aids our ability to grow the addiction treatment business from start-up to cash flow breakeven.” Mr. Leon added, “The one-time at-the-market conversion and new investment by Labrys was a show of confidence in the results of the restructuring transactions undertaken by the Company.”
The Company expects the cash provided by these events will be sufficient to meet the Company’s operational cash flow requirements for the addiction treatment center start-up. The Company will continue to pursue Regulation A Tier II financing to support accretive acquisitions in the near future.
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