Niwot, Colorado, Nov. 01, 2018 (GLOBE NEWSWIRE) -- Global Healthcare REIT, Inc. (OTC:GBCS) (the “Company”) announced that effective October 15, 2018, it consummated the First Closing of a private offering of Units, each Unit consisting of an 11% Senior Secured Note and one warrant for each $1.00 in principal amount of Note with a strike price at $0.50. The Offering is being conducted through a registered broker-dealer acting as a Placement Agent.
In closing the Minimum Offering, the Company sold an aggregate of $660,000 in Units to new cash investors, and also sold an additional $1,075,000 in Units to holders of existing 10% senior notes and warrants that were exchanged for Units in the Offering. After payment of Placement Agent and Escrow Agent fees, the Company realized net proceeds of $619,400.
Effective October 31, 2018, the Company consummated a Second Closing of the Offering having sold an additional $385,000 in Units. After payment of Placement Agent fees, the Company realized net proceeds of $361,900.
The Company and Placement Agent have agreed to continue the Offering until the earlier of (i) the sale of the Maximum Offering of $1.75 million or (ii) the mutual agreement to terminate the Offering.
Additionally, effective November 1, 2018, the Company called and retired the remaining $4.45 million Tulsa County Industrial Authority (“TCIA”) Bonds outstanding with a First Commercial Line of Credit that was established on October 31, 2017. Since April 2017, the Company repurchased $1.62 million bonds for $1.17 million in cash through open market purchases and various tender offers at discounted prices. The First Commercial Line of Credit will now convert into an amortizing loan. The refinancing saves the company $92,000 in annual debt service payments while providing low cost capital to fund the renovations at our Tulsa ILF.
The Company also announced that in two separate privately negotiated transactions it has repurchased an aggregate of 371,399 shares of common stock for consideration of $108,508. The repurchased shares have been cancelled and are no longer outstanding.
Zvi Rhine, the Company’s President, stated “As part of our capital allocation program, we will seek to make additional share repurchases through privately negotiated transactions in concert with completing our renovation project at our Tulsa ILF. Retiring the TCIA Bonds exemplifies leveraging our strong senior lending relationships to reduce our interest expense and significantly improve our capital structure.”
Lance Baller, the Company’s CEO, added “We are extremely pleased with the progress we have made in making additional capital available to support our aggressive property upgrades and new acquisition strategy. Our stock repurchases underscore our belief that the market price for our stock is significantly undervalued.”
For Further Information Contact:
Zvi Rhine, President