Ethema Health Corp (GRST)

[Bubae]

They mention replacing the nearly $3.9 million mortgage due in July with a deal using investors in the Q3 press release. The lease is up for renewal this month and it doesn't sound like a sale of the property is in the works. You can bet that an investment deal will cost more than the current 4.2% mortgage. Why sell the property that generates the only real cash flow for the company when they can fix the share structure and sell more shares?

"...Ethema also plans to implement the same structure for its Canadian property which will also improve the Balance sheet..."

Ethema 2020 annual 10K
https://sec.report/Document/0001721868-21-000220/

Greenestone Muskoka Treatment Facility
The Greenestone Muskoka Treatment Facility is located in Bala, Ontario at 3571 Highway 169. The property is 43 acres in size and contains approximately 48,000 square feet of buildings. The property is owned by Ethema’s wholly owned Canadian subsidiary CCH and has been leased to the new owner of the Muskoka Clinic for a term of five years, which ends on February 28, 2022. The Lease gives the tenant an option to extend for three additional five (5) year terms, an option to purchase the property at any time for a purchase price of $7,000,000 in the first thirty six (36) months of the term and thereafter at a purchase price increased by $1,500,000 for each successive year up to a maximum of $10,000,000, and a right of first refusal in the event of a sale to a third party.



For the quarterly period ended September 30, 2021
https://sec.report/Document/0001721868-21-000835/

14. Mortgage loans
Within the next twelve months $ 3,874,157

Cranberry Cove Holdings, Ltd.

On July 19, 2017, CCH, a wholly owned subsidiary, closed on a loan agreement in the principal amount of CDN$5,500,000. The loan is secured by a first mortgage on the premises owned by CCH located at 3571 Muskoka Road 169, Bala, Ontario. The loan bears interest at the fixed rate of 4.2% with a 5-year primary term and a 25-year amortization. The Company has guaranteed the loan and the Company’s chief executive officer and controlling shareholder also has personally guaranteed the Loan. CCH and the Company have granted the Lender a general security interest in its assets to secure repayment of the Loan. The loan is amortized with monthly installments of CDN $29,531.



Debt restructuring 8K December 2020
https://sec.report/Document/0001721868-20-000600/

Leonite Capital LLC

On July 12, 2020, the company entered into a debt extinguishment agreement with Leonite whereby the following occurred:

1. The total amount outstanding under the note, including principal and interest was reduced to $150,000

2. $700,000 of the note was converted into Series A Redeemable Preferred shares in the Company’s subsidiary, Cranberry Cove Holdings, accruing dividends at 10% per annum.

3....

Q3 earnings press release.
https://www.globenewswire.com/news-release/2021/11/23/2339427/0/en/Ethema-Releases-Third-Quarter-Results.html

"…The Company has also made the decision to move forward with the purchase of the property at 950 Evernia Street, West Palm Beach, Florida. The purchase will be an off-balance sheet structure whereby the Company will be the General Partner in a limited partnership which will use debt and equity from Limited partners as the structure to own the property. This will eliminate the need to raise equity in Ethema directly and as the General Partner, Ethema will still benefit from the ownership of the property. Ethema also plans to implement the same structure for its Canadian property which will also improve the Balance sheet. The U.S. limited partnership will be raising $1,500,000 in equity and the Canadian limited partnership will be raising CDN$1,500,000 in equity. Investors interested in participating in the offering may contact the Company CEO for investment disclosure documents. The Company will also be making these disclosures available on its website. … "



https://www.investopedia.com/terms/g/generalpartner.asp

Understanding General Partner
A general partner has the authority to act on behalf of the business without the knowledge or permission of the other partners. Unlike a limited or silent partner, the general partner may have unlimited liability for the debts of the business.