Ethema Health Corp (GRST)

[Bubae]

The Mirage note to help pay for the $1.1 million to be handed over to Lawrence (Larry) Hawkins matures today. The balance as of September 30th was $619,500, chart page 17. We have to go back to the Q1 filing to see a full description for the notes default terms because those terms are omitted in the Q2 and now Q3 filings. Under the terms of default the note holder is entitles to the 25% of ATHI using the calculation. The same 25% that Ethema Health just agreed to pay $1.1 million for on May 15th. ATHI (American Treatment Holdings Inc.} is the holding company for the Boca and Evernia treatment centers and has a share structure of its own. There are no comments in the subsequent events section of the Q3 filing mentioning this note and I'm not finding anything that tells us what they are doing about this note. I suspect that we will see a new debt agreement soon. Could we see the split and amended regulation "A" offering soon?


For the quarterly period ended September 30, 2024
https://www.sec.gov/ix?doc=/Archives/edgar/data/0000792935/000190359624000678/grst_10q.htm


10. Short-term Notes (continued)
Mirage Realty, LLC

• On May 15, 2024, the Company, entered into a senior secured promissory note in the aggregate principal amount of $600,000. The note earns interest at 6% per annum for the first two months and 9% per annum for the following two months and 18% for the next two months. The note matures on November 15, 2024. The proceeds of the note were used to acquire the minority shareholder interest in ATHI, refer note 4 above.

For the quarterly period ended March 31, 2024
https://www.sec.gov/ix?doc=/Archives/edgar/data/0000792935/000190359624000371/grst_10q.htm

Page 24
Senior secured promissory note
On May 15, 2024, the Company, together with its subsidiaries, Evernia Health Center, LLC, American Treatment Holdings Inc, and Shawn Leon, entered into a Senior Secured Promissory Note (“Senior Note”)with an accredited investor for gross proceeds of $600,000, maturing on November 15, 2024 and bearing interest at 6% per annum for the first two months, 9% per annum for the following two months and 18% per annum for the last two months. The note also provides for default interest at a maximum of 24% per month, subject to the Usury Act. The Senior Note is senior to all other indebtedness including the promissory note issued to Q Global Trust, LLC (“Q Global”), except for allowed payments in terms of the Q Global agreement, as described below. The Senior Note, upon an event of default, may be converted into shares of ATHI at the rate of 1% of ATHI for each $24,000 of indebtedness, capped at $633,000. The proceeds from this note were used as the down payment for the acquisition of the remaining 25% of ATHI held by the minority shareholder.

Purchase of minority shareholder interest in ATHI

On May 15, 2024, the Company, Q Global Trust, LLC (the “Seller”), Lawrence B Hawkins and ATHI entered into an agreement for the purchase of the 25% minority shareholders interest in the share capital of ATHI for gross proceeds of $1,100,000. The Company paid proceeds of $625,000 on closing, and issued the Seller a promissory note for $475,000, subordinated to the Senior Note above. The Company will make 8 monthly installments of $10,000 each and on the ninth month a payment of $157,500, for the next eight months the Company will make payments of $10,000 each and on the eighteenth month a final payment of $157,500, totaling $475,000. The note does not bear interest and is guaranteed by Shawn Leon, Evernia Health Center, LLC and ATHI.