0001493152-19-007844.txt : 20190520 0001493152-19-007844.hdr.sgml : 20190520 20190520150125 ACCESSION NUMBER: 0001493152-19-007844 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 67 CONFORMED PERIOD OF REPORT: 20190331 FILED AS OF DATE: 20190520 DATE AS OF CHANGE: 20190520 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GLOBAL HEALTHCARE REIT, INC. CENTRAL INDEX KEY: 0000727346 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 870340206 STATE OF INCORPORATION: UT FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-15415 FILM NUMBER: 19838462 BUSINESS ADDRESS: STREET 1: 6800 N 79TH ST STREET 2: SUITE 200 CITY: NIWOT STATE: CO ZIP: 80503 BUSINESS PHONE: 303-449-2100 MAIL ADDRESS: STREET 1: 6800 N 79TH ST STREET 2: SUITE 200 CITY: NIWOT STATE: CO ZIP: 80503 FORMER COMPANY: FORMER CONFORMED NAME: GLOBAL CASINOS INC DATE OF NAME CHANGE: 19950413 FORMER COMPANY: FORMER CONFORMED NAME: MORGRO CHEMICAL CO DATE OF NAME CHANGE: 19920703 10-Q 1 form10-q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2019

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT

For the transition period from_______ to ______

Commission file number 0-15415

GLOBAL HEALTHCARE REIT, INC.

(Exact name of Registrant as specified in its Charter)

Utah		87-0340206
(State or other jurisdiction of		I.R.S. Employer
incorporation or organization)		Identification number

6800 N. 79^th St., Ste. 200,

Niwot, CO 80503

80503

(Address of principal executive offices)

(Zip Code)

Issuer’s telephone number: (303) 449-2100

Check whether the Issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the last 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [ ] No [X]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated filer [ ] Smaller Reporting Company [X]

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company [X]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes [ ] No [X]

As of May 20, 2019, the Registrant had 27,350,131 shares of its Common Stock outstanding.

INDEX

		Page No.

	PART I — FINANCIAL INFORMATION

Item 1.	Consolidated Financial Statements (Unaudited)	3

	Consolidated Balance Sheets as of March 31, 2019 (Unaudited) and December 31, 2018	3

	Consolidated Statements of Operations for the Three Months Ended March 31, 2019 and 2018 (Unaudited)	4

	Consolidated Statements of Changes in Equity for the Three Months Ended March 31, 2019 and 2018 (Unaudited)	5

	Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2019 and 2018 (Unaudited)	6

	Notes to Unaudited Consolidated Financial Statements	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	27

Item 4.	Controls and Procedures	27

PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	28

Item 1A.	Risk Factors	28

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	28

Item 3.	Defaults Upon Senior Securities	28

Item 4.	Removed and Reserved	28

Item 5.	Other Information	28

Item 6.	Exhibits	29

PART 1. FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements (Unaudited)

GLOBAL HEALTHCARE REIT, INC.

CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

	March 31, 2019			December 31, 2018
ASSETS
Property and Equipment, Net	$	36,524,474		$	35,885,145
Cash and Cash Equivalents		386,124			1,100,218
Restricted Cash		228,515			206,989
Accounts Receivable, Net		435,659			166,696
Investments in Debt Securities		12,134			162,106
Prepaid Expenses and Other		902,403			774,733
Total Assets	$	38,489,309		$	38,295,887

LIABILITIES AND EQUITY
Liabilities
Debt, Net of discount of $483,590 and $507,829, respectively	$	35,744,057		$	35,721,341
Debt – Related Parties, Net of discount of $0 and $0, respectively		875,000			875,000
Accounts Payable and Accrued Liabilities		298,886			306,437
Accounts Payable – Related Parties		93,406			118,230
Dividends Payable		7,500			7,500
Derivative Liability		2,682			2,785
Lease Security Deposit		280,000			280,000
Total Liabilities		37,301,531			37,311,293
Commitments and Contingencies Equity
Stockholders’ Equity
Preferred Stock:
Series A - No Dividends, $2.00 Stated Value, Non-Voting; 2,000,000 Shares Authorized, 200,500 Shares Issued and Outstanding		401,000			401,000
Series D - 8% Cumulative, Convertible, $1.00 Stated Value, Non-Voting; 1,000,000 Shares Authorized, 375,000 Shares Issued and Outstanding		375,000			375,000
Common Stock - $0.05 Par Value; 50,000,000 Shares Authorized, 27,077,404 and 26,300,317 Shares Issued and Outstanding at March 31, 2019 and December 31, 2018, Respectively		1,353,870			1,340,234
Additional Paid-In Capital		10,174,041			10,137,148
Accumulated Deficit		(10,913,810	)		(11,070,606	)
Total Global Healthcare REIT, Inc. Stockholders’ Equity		1,390,101			1,182,776
Noncontrolling Interests		(202,323	)		(198,182	)
Total Equity		1,187,778			984,594
Total Liabilities and Equity	$	38,489,309		$	38,295,887

See accompanying notes to unaudited consolidated financial statements.

GLOBAL HEALTHCARE REIT, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

	Three Months Ended March 31,
	2019			2018

Revenue
Rental Revenue	$	895,288		$	812,065
Healthcare Revenue		379,791			-
Total Revenue		1,275,079			812,065
Expenses
General and Administrative		193,479			145,155
Property Taxes, Insurance and Other Operating		349,188			80,816
Depreciation		322,925			305,410
Total Expenses		865,592			531,381
Income from Operations		409,487			280,684
Other (Income) Expense
Gain on Warrant Liability		(103	)		(40,423	)
Gain on Extinguishment of Debt		-			(94,925	)
Loss on Settlement of Other Liabilities		-			29,900
Gain on Sale of Investments		(1,069	)		-
Gain on Proceeds from Insurance Claim		(270,264	)		-
Interest Income		(5,467	)		-
Interest Expense		526,235			598,366
Total Other (Income) Expense		249,332			492,918
Net Income (Loss)		160,155			(212,234	)
Net Loss Attributable to Noncontrolling Interests		4,141			7,901
Net Income (Loss) Attributable to Global Healthcare REIT, Inc.		164,296			(204,333	)
Series D Preferred Dividends		(7,500	)		(7,500	)
Net Income (Loss) Attributable to Common Stockholders	$	156,796		$	(211,833	)
Per Share Data:
Net Income (Loss) per Share Attributable to Common Stockholders:
Basic	$	0.01		$	(0.01	)
Diluted	$	0.01		$	(0.01	)
Weighted Average Common Shares Outstanding:
Basic		26,895,586			26,662,817
Diluted		26,895,586			26,662,817

See accompanying notes to unaudited consolidated financial statements.

GLOBAL HEALTHCARE REIT, INC.

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

(UNAUDITED)

	Series A Preferred Stock				Series D Preferred Stock				Common Stock				Additional					Global Healthcare REIT, Inc.			Non-
	Number of Shares		Amount		Number of Shares		Amount		Number of Shares		Amount		Paid-In Capital		Accumulated Deficit			Stockholders’ Equity			controlling Interests			Total Equity

Balance, December 31, 2018		200,500	$	401,000		375,000	$	375,000		26,804,677	$	1,340,234	$	10,137,148	$	(11,070,606	)	$	1,182,776		$	(198,182	)	$	984,594
Share Based Compensation – Restricted Stock Awards and Stock Options		-		-		-		-		272,727		13,636		36,893		-			50,529			-			50,529
Series D Preferred Dividends		-		-		-		-		-		-		-		(7,500	)		(7,500	)		-			(7,500	)
Net Income (Loss)		-		-		-		-		-		-		-		164,296			164,296			(4,141	)		160,155
Balance, March 31, 2019		200,500	$	401,000		375,000	$	375,000		27,077,404	$	1,353,870	$	10,174,041	$	(10,913,810	)	$	1,390,101		$	(202,323	)	$	1,187,778

	Series A Preferred Stock				Series D Preferred Stock				Common Stock				Additional					Global Healthcare REIT, Inc.			Non-
	Number of Shares		Amount		Number of Shares		Amount		Number of Shares		Amount		Paid-In Capital		Accumulated Deficit			Stockholders’ Equity			controlling Interests			Total Equity

Balance, December 31, 2017		200,500	$	401,000		375,000	$	375,000		26,300,317	$	1,315,016	$	9,422,924	$	(9,048,443	)	$	2,465,497		$	(183,339	)	$	2,282,158
Share Based Compensation – Restricted Stock Awards		-		-		-		-		562,500		28,125		16,875		-			45,000			-			45,000
Series D Preferred Dividends		-		-		-		-		-		-		-		(7,500	)		(7,500	)		-			(7,500	)
Loss on Modification of Warrants Triggering Extinguishment of Debt		-		-		-		-		-		-		29,900		-			29,900						29,900
Net Loss		-		-		-		-		-		-		-		(204,333	)		(204,333	)		(7,901	)		(212,234	)
Balance, March 31, 2018		200,500	$	401,000		375,000	$	375,000		26,862,817	$	1,343,141	$	9,469,699	$	(9,260,276	)	$	2,328,564		$	(191,240	)	$	2,137,324

See accompanying notes to unaudited consolidated financial statements.

GLOBAL HEALTHCARE REIT, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

	Three Months Ended March 31,
	2019			2018
Cash Flows From Operating Activities:
Net income (loss)	$	160,155		$	(212,234	)
Adjustments to Reconcile Net Income (Loss) to Net Cash Provided by Operating Activities:
Depreciation		322,925			305,410
Amortization and Accretion		33,124			45,047
Increase in Deferred Rent Receivable		(22,089	)		(23,736	)
Stock Based Compensation		50,529			45,000
Gain on Sale of Investments		(1,069	)		-
Loss on Extinguishment of Debt		-			29,900
Gain on Settlement of Debt		-			(94,925	)
Gain on Derivative Liability		(103	)		(40,423	)
Changes in Operating Assets and Liabilities, Net of Assets and Liabilities Acquired:
Accounts & Rents Receivable		(268,963	)		52,796
Prepaid Expenses		38,085			(45,979	)
Accounts Payable and Accrued Liabilities		(46,455	)		147,464
Cash Provided by Operating Activities		266,139			208,320

Cash Flows From Investing Activities:
Issuance of Note Receivable		(143,666	)		-
Purchase of Investments in Debt Securities		-			(34,576	)
Proceeds from Sale of Investments in Debt Securities		151,041			-
Capital Expenditures on Property and Equipment Additions		(962,254	)		(143,445	)
Cash Used in Investing Activities		(954,879	)		(178,021	)

Cash Flows From Financing Activities:
Proceeds from Issuance of Debt, Outside Parties		159,875			52,862
Payments on Debt, Outside Parties		(147,318	)		(132,448	)
Deferred Loan Costs Paid		(8,885	)		-
Dividends Paid on Preferred Stock		(7,500	)		(7,500	)
Cash Used In Financing Activities		(3,828	)		(87,086	)

Net Decrease in Cash		(692,568	)		(56,787	)
Cash and Cash Equivalent and Restricted Cash at Beginning of the Year		1,307,207			972,148
Cash and Cash Equivalent and Restricted Cash at End of the Year	$	614,639		$	915,361

Supplemental Disclosure of Cash Flow Information
Cash Paid for Interest	$	506,367		$	453,698
Cash Paid for Income Taxes	$	-		$	-

Cash and Cash Equivalent	$	386,124		$	105,486
Restricted Cash		228,515			809,875
Total Cash and Cash Equivalent and Restricted Cash	$	614,639		$	915,361

Supplemental Schedule of Non-Cash Investing and Financing Activities
Dividends declared on Series D Preferred Stock	$	7,500		$	7,500
Offers from Line of Credit to Settle Bonds Payable	$	-		$	380,075

See accompanying notes to unaudited consolidated financial statements.

GLOBAL HEALTHCARE REIT, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization and Description of the Business

Global Healthcare REIT, Inc. (the Company or Global) was organized with the intent of operating as a real estate investment trust (REIT) for the purpose of investing in real estate and other assets related to the healthcare industry. Prior to the Company changing its name to Global Healthcare REIT, Inc. on September 30, 2013, the Company was known as Global Casinos, Inc. Global Casinos, Inc. operated two gaming casinos which were split-off and sold on September 30, 2013. Simultaneous with the split-off and sale of the gaming operations, the Company acquired West Paces Ferry Healthcare REIT, Inc. (WPF) in a transaction accounted for as a reverse acquisition whereby WPF was deemed to be the accounting acquirer.

The Company intends to make a REIT election under sections 856 through 859 of the Internal Revenue Code of 1986, as amended. Such election will be made by the Board of Directors at such time as the Board determines that we qualify as a REIT under applicable provisions of the Internal Revenue Code.

The Company acquires, develops, leases, manages and disposes of healthcare real estate, and provides financing to healthcare providers. As of March 31, 2019, the Company owned eleven healthcare properties which are leased or managed by third-party operators under triple-net operating terms.

Basis of Presentation

The accompanying unaudited interim consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP) for interim financial information and in conjunction with the rules and regulations of the Securities Exchange Commission. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments considered necessary to make the consolidated financial statements not misleading have been included. Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the entire year. The unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 filed with the Securities and Exchange Commission.

Recently Adopted Accounting Pronouncements

Effective January 1, 2019, the Company adopted ASU No. 2018-07, Compensation – Stock Based Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-7”), which aligns accounting for share-based payments issued to nonemployees to that of employees under the existing guidance of Topic 718, with certain exceptions. This update supersedes previous guidance for equity-based payments to nonemployees under Subtopic 505-50, Equity – Equity-Based Payments to Non-Employees. The adoption of ASU 2018-07 did not have a material impact on the Company’s consolidated financial statements.

In February 2016, the Financial Accounting Standards Board issued ASU No. 2016-02, “Leases: Topic 842 (ASU 2016-02)”, to supersede nearly all existing lease guidance under GAAP. The guidance would require lessees to recognize most leases on their balance sheets as lease liabilities with corresponding right-of-use assets. ASU 2016-02 is effective for the Company as of January 1, 2019 and adoption requires using a modified retrospective approach with the option to elect certain practical expedients. The Company has determined that it does not have any leases that fall under the guidance of ASU 2016-02 and it had no impact on its consolidated financial statements.

Recently Issued Accounting Pronouncements

The Financial Accounting Standards Board and other entities issued new or modifications to, or interpretations of, existing accounting guidance during 2019. Management has carefully considered the new pronouncements that altered generally accepted accounting principles and does not believe that any other new or modified principles will have a material impact on the Company’s reported financial position or operations in the near term.

2. GOING CONCERN

The accompanying consolidated financial statements and notes have been prepared assuming the Company will continue as a going concern.

For the three months ended March 31, 2019, the Company had net income of $160,155 and reported net cash provided by operations of $266,139. During the years ended December 31, 2018 and December 31, 2017, the Company incurred net losses of $2,007,006 and $3,001,618, respectively, and as of March 31, 2019 has an accumulated deficit of $10,913,810. These circumstances raise substantial doubt as to the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon the Company’s ability to generate sufficient revenues and cash flows to operate profitably and meet contractual obligations, or raise additional capital through debt financing or through sales of common stock.

The failure to achieve the necessary levels of profitability and cash flows or obtain additional funding would be detrimental to the Company. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

3. PROPERTY AND EQUIPMENT

The gross carrying amount and accumulated depreciation of the Company’s property and equipment as of March 31, 2019 and December 31, 2018 are as follows:

	March 31, 2019			December 31, 2018

Land	$	1,597,500		$	1,597,500
Land Improvements		200,000			200,000
Buildings and Improvements		36,126,867			36,076,632
Furniture, Fixtures and Equipment		1,475,923			1,469,976
Construction in Progress		4,822,259			3,916,187
		44,222,549			43,260,295

Less Accumulated Depreciation		(6,138,075	)		(5,815,150	)
Less Impairment		(1,560,000	)		(1,560,000	)

	$	36,524,474		$	35,885,145

	For the Three Months Ended March 31,
	2019		2018

Depreciation Expense	$	322,925	$	305,410
Cash Paid for Capital Expenditures	$	962,254	$	143,445

4. INVESTMENTS IN DEBT SECURITIES

At March 31, 2019 and December 31, 2018, the Company held investments in marketable securities that were classified as held-to-maturity and carried at amortized costs. Held-to-maturity securities consisted of the following:

	March 31, 2019		December 31, 2018

States and Municipalities	$	12,134	$	162,106

Contractual maturity of held-to-maturity securities at March 31, 2019 is September 1, 2043, and total value of securities at their respective maturity dates is $30,000. Actual maturities may differ from contractual maturities because some borrowers have the right to call or prepay obligations with or without call or prepayment penalties. The Company received proceeds of $151,041 from the sale of debt securities, and recognized a gain on sale of investments of $1,069 during the three months ended March 31, 2019.

5. NOTES RECEIVABLE

Note Receivable – Receiver for Healthcare Management of Oklahoma, LLC

On May 10, 2016, the Company obtained a Court Order appointing a receiver to control and operate the skilled nursing facility in Southern Hills, Tulsa. The former lease operator represented that it was unable to meet the financial commitments of the facility, including the payment of rent, payroll, and other operating requirements. The transition to the receiver was part of a turnaround effort to restore viable operations at the facility. The Court ordered the Company to provide the receiver a revolving line of credit not to exceed $250,000 of which the Company advanced $150,000 during 2016. The receiver is to repay the revolving unsecured line of credit from the operation or sale of the facility or other sources. The Company has determined the note as no longer being collectible based on the ability to repay and has recorded bad debt expense of $150,000 in the consolidated statements of operations for the year ended December 31, 2016. During November 2017, the Company made a short-term loan in the amount of $84,000 to the operator with the understanding that it would be repaid immediately; the loan was repaid during 2018.

Note Receivable: Accounts Receivable Line of Credit (“ARLOC”) – Infinity Health Interests, LLC

As part of the transition to a new tenant at High Street Nursing facility, the Company committed a $250,000 Accounts Receivable Line of Credit (“ARLOC”) to an affiliate of Infinity Health Interests, LLC (“Infinity”) in order to ensure that no disruptions in management of the facility occur. The ARLOC is secured by a first lien on all the receivables of the facility as well as a personal guarantee from the two principals of Infinity. The Company expects facility level operational performance to improve under Infinity’s stewardship and commitment to the surrounding community. As of March 31, 2019 and December 31, 2018 the Company had lent $250,000 and $106,334, respectively, to Infinity under this agreement.

6. DEBT AND DEBT-RELATED PARTIES

The following is a summary of the Company’s debt outstanding as of March 31, 2019 and December 31, 2018:

	March 31, 2019			December 31, 2018

Senior Secured Promissory Notes	$	1,485,000		$	1,485,000
Senior Unsecured Promissory Notes		300,000			300,000
Senior Secured Promissory Notes - Related Parties		875,000			875,000
Fixed-Rate Mortgage Loans		20,902,663			21,049,981
Variable-Rate Mortgage Loans		4,618,006			4,618,006
Line of Credit		7,385,978			7,240,183
Other Debt		1,536,000			1,536,000

		37,102,647			37,104,170

Premium, Unamortized Discount and Debt Issuance Costs		(483,590	)		(507,829	)

	$	36,619,057		$	36,596,341

As presented in the Consolidated Balance Sheets:

Debt, Net	$	35,744,057		$	35,721,341

Debt - Related Parties, Net		875,000			875,000

	$	36,619,057		$	36,596,341

Corporate Senior and Senior Secured Promissory Notes

From November through December 2016, the Company undertook a private offering of its 10% Senior Secured Promissory Notes. As of December 31, 2016, $600,000 of the notes had been issued of which $450,000 were issued to the directors of the Company or entities or persons affiliated with these directors. The notes initially bore interest at a rate of 10% payable monthly with principal and unpaid interest due at maturity, originally January 13, 2018. The notes were issued with warrants to purchase 600,000 shares of common stock at an exercise price of $0.75 per share. The warrants have a cashless exercise provision.

The notes are secured by all assets of the Company not serving as collateral for other notes. As of December 31, 2017, $500,000 in notes had their maturity date extended to December 31, 2018, and all notes’ maturity dates were extended prior to their original maturity. The maturity date of the 600,000 warrants issued along with the notes was extended to December 31, 2018 as well. The transaction was accounted for as a debt extinguishment with a loss on modification of warrant in the amount of $62,696 recorded in the consolidated statement of operations for the year ended December 31, 2017.

In 2017, an additional $600,000 in notes were sold and issued, of which $425,000 were to related parties. At December 31, 2017, there were outstanding an aggregate of $1.2 million in senior secured notes. The maturity date of all the senior secured notes was extended to December 31, 2018 prior to their original maturity date, $225,000 of which occurred in 2018. During 2018, among the $225,000 senior secured notes that were extended to December 31, 2018, $125,000 were to related parties. For every $1.00 in principal amount of note, investors got one warrant exercisable for one year to purchase an additional share of common stock at an exercise price of $.75 per share. The warrants have a cashless exercise provision and were valued using the Black-Scholes pricing model. The maturity date of the 1.2 million warrants issued along with the notes was extended to December 31, 2018 as well, 225,000 warrants of which occurred in 2018.

In October 2017, the Company sold an aggregate of $300,000 in senior unsecured notes. The notes bear interest at the rate of 10% per annum and are due in 2020. For every $1.00 in principal amount of note, investors got one warrant exercisable for one year to purchase an additional share of common stock at an exercise price of $.75 per share. The warrants have a cashless exercise provision.

In October 2018, the Company, through a registered broker-dealer acting as Placement Agent, undertook a private offering to accredited investors of Units, each Unit consisting of an 11% Senior Secured Note, due in three years, (October 31, 2021) and Warrant for each $1.00 in principal amount of Note exercisable for three years to purchase a share of Common Stock at an exercise price of $0.50 per share. The Company and the Placement Agent completed the Offering in December 2018 having sold an aggregate of $1,160,000 in Notes and Warrants. The net proceeds to the Company were $1,092,400, after deducting Placement Agent fees of $67,600, and issued 111,000 warrants to the Placement Agent with $21,453 of the fair value of the warrants recorded as loan cost. The Offering also included the exchange of an aggregate of $1.075 million in outstanding senior secured 10% Notes and Warrants for Units in the Offering. No proceeds were realized from the exchange and no fees were paid to the Placement Agent for such exchanges. During 2018, among the $1.075 million senior secured notes that were extended to October 31, 2021 by virtue of the exchange, $875,000 were to related parties. As of March 31, 2019 the Company had not renewed or repaid $125,000 in 10% notes with a maturity date of December 31, 2018, and those notes were technically in default.

The value of the warrants issued to the note holders was calculated using the Black-Scholes pricing model using the following significant assumptions:

	December 31, 2018

Volatility		122% - 123	%
Risk-free Interest Rate		2.76% - 2.94	%
Exercise Price	$	0.50
Fair Value of Common Stock	$	0.30 - $0.35
Expected Life		2.9 – 3.0 years

During the year ended December 31, 2017, the Company issued 900,000 warrants in connection with its note offerings with a value on the issue date estimated to be $121,435, bifurcated from the value of the note. As of December 31, 2017, the unamortized balance of discount on notes was $77,105. During the year ended December 31, 2018, the Company issued 1,160,000 warrants with a value on the issue date estimated to be $207,025 bifurcated from the value of the note and exchanged 1,075,000 existing warrants for new ones in connection with its note offerings. As a result of the modification the Company recognized a loss on extinguishment of $248,346. As of March 31, 2019, the unamortized balance of discount on notes was $196,908. Amortization expense was $16,261 and $19,568 for the three months ended March 31, 2019 and 2018, respectively.

Mortgage Loans and Lines of Credit Secured by Real Estate

Mortgage loans and other debts such as line of credit here are collateralized by all assets of each nursing home property and an assignment of its rents. Collateral for certain mortgage loans includes the personal guarantee of Christopher Brogdon. Mortgage loans for the periods presented consisted of the following:

	Face		Principal Outstanding at				Stated Interest	Maturity
Property	Amount		March 31, 2019		December 31, 2018		Rate	Date

Southern Hills Retirement Center Line of Credit ⁽¹⁾⁽²⁾	$	7,229,052	$	7,105,218	$	7,119,743	5.25% Fixed	April 28, 2019
Middle Georgia Nursing Home ^(2,3)		3,570,000		3,533,486		3,561,461	5.50% Fixed	October 26, 2021
Goodwill Nursing Home ⁽²⁾		5,005,000		4,355,739		4,390,082	5.50% Fixed	March 19, 2020
Warrenton Nursing Home ⁽⁴⁾		2,720,000		2,270,447		2,287,323	5.50% Fixed	January 20, 2020
Edward Redeemer Health & Rehab		2,303,815		2,118,284		2,138,128	5.50% Fixed	January 16, 2020
Glen Eagle Health & Rehab ⁽⁵⁾		2,761,250		2,743,557		2,761,250	5.50% Fixed	May 25, 2021
Glen Eagle Health and Rehab Line of Credit ⁽²⁾⁽⁵⁾		400,000		280,760		120,440	6.50% Fixed	September 30, 2019
Providence of Sparta Nursing Home ⁽⁶⁾		3,039,300		2,961,250		2,975,337	3.88% Fixed	November 1, 2047
Meadowview Healthcare Center ⁽⁷⁾		3,000,000		2,919,900		2,936,400	6.00% Fixed	October 30, 2022
GL Nursing Home ⁽⁸⁾		5,000,000		4,618,006		4,618,006	Prime Plus 1.50%/ 5.75% Floor	August 3, 2037

			$	32,906,647	$	32,908,170

(1) On October 31, 2017, the Company, through its wholly-owned subsidiaries Southern Tulsa, LLC and Southern Tulsa TLC, LLC, as Co-Borrowers, consummated a new Line of Credit with Southern Bank (formerly First Commercial Bank) pursuant to a Promissory Note in the principal amount of $7,229,052 (the “Line of Credit”). Under the Line of Credit, the Company refinanced the prior mortgage on its skilled nursing facility in Tulsa for $1,546,801,funded open market and tender offer purchases of its Industrial Revenue Bonds covering the ALF and ILF as well as provided working capital for improvements to the ALF and ILF. As of December 31, 2018, a total of $7,119,743 was drawn under the Line of Credit, and as of March 31, 2019, a total of $7,105,218 was drawn under the Line of Credit.

The interest rate on the Line of Credit is 5.25%. Monthly payments of interest began on November 30, 2017 and continue until the Promissory Note is paid in full on the Maturity Date. On May 3, 2018 the Maturity Date was extended from April 30, 2018 to October 30, 2018. The Maturity Date was further extended to February 28, 2019 and subsequently to April 28, 2019, with the intent to convert to an amortizing loan thereafter. The Credit Note is secured by a First Mortgage and Assignment of Rents on Real Property for Southern Hills Rehabilitation Center, a Junior Lien and Assignment of Rents on Real Property for it Southern Hills Independent Living Facility location and a Junior Lien on Real Property for its Southern Hills Assisted Living Facility location. With the retirement of the Tulsa Industrial Authority Bonds effective November 1, 2018, Southern Bank (formerly First Commercial Bank) moved into a senior position on the ALF and ILF properties.

(2) Mortgage loans are non-recourse to the Company except for (i) the senior loan held by ServisFirst Bank on Meadowview (Ohio), (ii) the loan held by Colony Bank on Middle Georgia and Glen Eagle, and (iii) the Southern Hills line of credit and Goodwill loan owed to Southern Bank (formerly First Commercial Bank).

(3) The loan at Middle Georgia was renewed on November 26, 2018 with the maturity extended to October 26, 2021.

(4) The loan was extended on January 19, 2019 to January 20, 2020 and the Company capitalized $8,885 in loan costs paid, amortized over the term of the extension. Amortization expense related to loan costs of this loan totaled $2,050 for the three months ended March 31, 2019. The Company has incurred $43,681 in unamortized loan costs to refinance this debt with another lender.

(5) Amortization expense related to loan costs of this loan totaled $219 for the three months ended March 31, 2019. Amortizing payments began in January 2019. In June 2018 the Company converted the original note to a fixed note which qualified as debt extinguishment, unamortized debt discount on the original note was expensed as a loss on extinguishment of $27,794. In April 2018, the Company capitalized $22,800 in fees and interest and added it to principal. The Company is subject to financial covenants and customary affirmative and negative covenants, including compliance with the covenants of all other notes and bonds. As of March 31, 2019, the Company was not in compliance with some unrelated notes and bonds, which is considered to be a technical Event of Default as defined in the note agreement, but the Company believes that it is in good standing with the Lender. In October 2018 the Lender extended the Company a line of credit with a limit of $200,365 to provide working capital to scale operations at the facility. As of December 31, 2018 the Company had drawn $120,440 on the line. The line of credit was expanded in February 2019 to $400,000 with a maturity of September 30, 2019. As of March 31, 2019, the Company had drawn $280,760 on the line.

(6) The senior debt and subordinated debt owed in relation to Providence of Sparta was refinanced into a single senior HUD note during 2017. Amortization expense related to loan costs totaled $1,246 for the three months ended March 31, 2019.

(7) Amortization expense related to loan costs of this loan totaled $2,326 for the three months ended March 31, 2019. The Company is subject to financial covenants and customary affirmative and negative covenants, including compliance with the covenants of all other notes and bonds. As of March 31, 2019, the Company was not in compliance with some unrelated notes and bonds, which is considered to be a technical Event of Default as defined in the note agreement, but the Company believes that it is in good standing with the Lender.

(8) Effective September 19, 2016, we executed a Modification to the mortgage note pursuant to which some accrued payments were deferred, and the lender agreed to permit interest only payments through March 2017. The mortgage loan collateralized by the GL Nursing Home is 80% guaranteed by the USDA and requires an annual renewal fee payable in the amount of 0.25% of the USDA guaranteed portion of the outstanding principal balance as of December 31 of each year. The Company is subject to financial covenants and customary affirmative and negative covenants. As of March 31, 2019, the Company was not in compliance with certain of these financial and non-financial covenants which is considered to be a technical Event of Default as defined in the note agreement. The Company is also delinquent in installment payments due under the mortgage. Remedies available to the lender in the event of a continuing Event of Default, at its option, include, but are necessarily limited to the following (1) lender may declare the principal and all accrued interest on the note due and payable; and (2) lender may exercise additional rights and remedies under the note agreement to include taking possession of the collateral or seeking satisfaction from the guarantors. The Company has been notified by the lender regarding the Events of Default. Guarantors under the mortgage loan include Christopher Brogdon. With our consent, Mr. Brogdon has assumed operations of the facility and is dealing with the lender. The Company is in negotiations with Mr. Brogdon to sell him the facility.

Other mortgage loans contain non-financial covenants, including reporting obligations, with which the Company has not complied in some instances or in an untimely manner. These mortgage loans are technically in default.

Bonds Payable - Tulsa County Industrial Authority

On March 1, 2014, Southern Tulsa, LLC (Southern Tulsa), a subsidiary of WPF that owns the Southern Hills Retirement Center, entered into a loan agreement with the Tulsa County Industrial Authority (Authority) in the State of Oklahoma pursuant to which the Authority lent to Southern Tulsa the proceeds from the sale of the Authority’s Series 2014 Bonds. The Series 2014 Bonds consisted of $5,075,000 of principal in Series 2014A First Mortgage Revenue Bonds and $625,000 of principal in Series 2014B Taxable First Mortgage Revenue Bonds. During the year ended December 31, 2017, $127,000 of Series 2014B Taxable First Mortgage Revenue Bond were retired with $60,000 in cash payments and 67,000 in non-cash payments; $452,000 of Series 2014A First Mortgage Revenue Bonds were retired with non-cash payments. Deferred loan costs incurred of $478,950 and an original issue discount of $78,140 related to the loan are amortized to interest expense over the life of the loan. Amortization expense related to deferred loan costs and the original issue discount totaled $4,704 and $761, respectively, for the three months ended March 31, 2018. The loan agreement includes certain financial covenants required to be maintained by the Company, with which we were not in compliance as of March 31, 2019. There is $5,061,000 in voluntary non-cash principal reduction payments during the year ended December 31, 2018. As of March 31, 2019 and December 31, 2018, restricted cash of $1,179 and $1,179, respectively is related to these bonds.

Other Debt

Other debt due at March 31, 2019 and December 31, 2018 includes unsecured notes payable issued to entities controlled by the Company used to facilitate the acquisition of the nursing home properties.

Face

Principal Outstanding at

Stated Interest

Maturity

Property

Amount

March 31, 2019

December 31, 2018

Rate

Date

Goodwill Nursing Home

2,180,000

1,536,000

13% ⁽¹⁾ Fixed

December 31, 2019

(1) The subordinated note on Goodwill matured on July 1, 2015. Investors in the Goodwill note were entitled to an additional 5% equity in Goodwill Hunting, LLC every six months if the note is not paid when due. Effective December 31, 2015, the investors holding the subordinated debt executed an Agreement Among Lenders pursuant to which they (i) agreed to waive any and all equity ratchets and (ii) agreed to extend the maturity date of the subordinated debt to June 30, 2017. In exchange, Goodwill Hunting agreed to pay the investors an additional one-time premium equal to 5% of the principal amount of the individual note at such time as the note is repaid. Effective May 3, 2017, we entered into an Allonge and Modification Agreement with the Goodwill investors pursuant to which they agreed to (i) waive all accrued interest through December 31, 2017, (ii) reduce interest rate to 13% beginning January 1, 2018 and (iii) extend the maturity date of the notes to December 31, 2019. In exchange, the Company agreed that upon repayment of the notes, the investors would be entitled to a one-time premium payment in the amount of 15% of the principal balance of the notes.

For the three months ended March 31, 2019 and 2018, the Company received proceeds from the issuance of debt of $159,875 and $52,862, respectively. Cash payments on debt totaled $147,318 and $132,448 for the three months ended March 31, 2019 and 2018, respectively. Amortization expense for deferred loan costs totaled $33,124 and $45,047 for the three months ended March 31, 2019 and 2018, respectively.

Future maturities and principal reduction payments of all notes and bonds payable listed above for the next five years and thereafter are as follows:

Years
2019	$	19,659,755	⁽¹⁾
2020		9,013,714
2021		5,626,986
2022		64,013
2023		66,541
2024 and after		2,671,638

	$	37,102,647

(1) Any note or bond that is not in compliance with all financial and non-financial covenants is considered to have an immediate maturity, including those that require compliance with covenants on any and all other notes. The notes secured by the facilities at Meadowview and Abbeville have such covenants which were in technical non-compliance at March 31, 2019, but the Company believes that its relationships with these lenders is good.

7. STOCKHOLDERS’ EQUITY

Preferred Stock

The Company has authorized 10,000,000 shares of preferred stock. These shares may be issued in series with such rights and preferences as may be determined by the Board of Directors.

Series A Convertible Redeemable Preferred Stock

The Company’s Board of Directors has authorized 2,000,000 shares of $2.00 stated value, Series A Preferred Stock. The preferred stock has a senior liquidation preference value of $2.00 per share, has no voting or redemption rights and does not accrue dividends.

As of March 31, 2019 and December 31, 2018, the Company has 200,500 shares of Series A Preferred stock outstanding.

Series D Convertible Preferred Stock

The Company has established a class of preferred stock designated “Series D Convertible Preferred Stock” (Series D preferred stock) and authorized an aggregate of 1,000,000 non-voting shares with a stated value of $1.00 per share. Holders of the Series D preferred stock are entitled to receive dividends at the annual rate of eight percent (8%) based on the stated value per share computed on the basis of a 360 day year and twelve 30 day months. Dividends are cumulative, shall be declared quarterly, and are calculated from the date of issue and payable on the fifteenth day of April, July, October and January. The dividends may be paid, at the option of the holder either in cash or by the issuance of shares of the Company’s common stock valued at the market price on the dividend record date. Shares of the Series D preferred stock are redeemable at the Company’s option. At the option of the holder, shares of the Series D preferred stock plus any declared and unpaid dividends are convertible to shares of the Company’s common stock at a conversion rate of $1.00 per share.

As of March 31, 2019 and December 31, 2018, the Company had 375,000 shares of Series D preferred stock outstanding.

During the three months ended March 31, 2019 and 2018, the Company paid $7,500 and $7,500, respectively, for Series D preferred stock dividends. Dividends of $7,500 and $7,500 were declared during the three months ended March 31, 2019 and 2018, respectively, with dividends of $7,500 accrued and payable as of March 31, 2019 and 2018. All quarterly dividends previously declared have been paid.

Restricted Stock Awards

The following table summarizes the restricted stock unit activity during the three months ended March 31, 2019 and 2018.

	March 31, 2019			March 31, 2018

Outstanding Non-Vested Restricted Stock Units, Beginning		-			-
Granted		272,727			562,500
Vested		(68,182	)		(140,625	)

Outstanding Non-Vested Restricted Stock Units, Ending		204,545			421,875

In connection with these director and executive restricted stock grants, the Company recognized stock-based compensation of $22,500 and $45,000 for the three months ended March 31, 2019 and 2018, respectively.

Common Stock Warrants

As of March 31, 2019 and December 31, 2018, the Company had 2,714,918 and 3,142,586, respectively, of outstanding warrants to purchase common stock at a weighted average exercise price of $0.57 and $0.60, respectively. During the three month period ended March 31, 2019 and 2018, an aggregate of 427,668 and 71,250 warrants with a weighted average exercise price of $0.75 and $0.60, respectively, expired. The aggregate intrinsic value of the common stock warrants outstanding at March 31, 2019 was $0.

Common Stock Options

As of March 31, 2019 and December 31, 2018, the Company had 600,000 and 600,000, respectively, of outstanding options to purchase common stock at a weighted average exercise price of $0.36. During the three month period ended March 31, 2019 and 2018, no options expired. The aggregate intrinsic value of the common stock options outstanding at March 31, 2019 was $0.

8. RELATED PARTIES

Clifford Neuman provides office space for the Company’s Controller at no charge. As of March 31, 2019 and December 31, 2018, the Company owed Mr. Neuman for legal services rendered $93,406 and $118,230, respectively.

Creative Cyberweb developed and maintains the Company’s website, and is affiliated with CFO Zvi Rhine’s family. The ongoing upkeep is $450 per month.

In January 2018, the Directors modified the Directors’ Compensation Plan to provide the annual grants be subject to ratable vesting over 12 months. In March 2019, The Board approved an annual grant to three of its Directors without other compensation plans, restricted stock awards of 90,909 shares each, subject to vesting. In connection with these director restricted stock grants, the Company recognized stock-based compensation of $22,500 and $45,000 for the three months ended March 31, 2019 and 2018, respectively.

In May 2018, the Company approved a compensation agreement for CFO Zvi Rhine that included (i) base salary of $165,000 per year (which accrues beginning January 1, 2018 but payable only after the Company raises capital of at least $600,000), (ii) 150,000 shares of restricted stock vesting one-half each on January 1, 2019 and January 1, 2020, and (iii) options to purchase 600,000 of the Company’s common stock at an exercise price of $.36 per share, each expiring on March 31, 2023, and vesting one quarter each on April 1, 2018, April 1, 2019, October 1, 2019, and April 1, 2020. For the three months ended March 31, 2019 the Company has accrued $58,750 in salaries, and recognized $22,500 in stock-based compensation for Directors and $28,029 for Mr. Rhine. Effective April 1, 2019, the Company and Mr. Rhine entered into an Amendment No. 1 to the Employment Agreement. See Subsequent Events for details.

9. FACILITY LEASES

The following table summarizes our leasing arrangements related to the Company’s healthcare facilities at March 31, 2019:

Facility	Monthly Lease Income ⁽¹⁾		Lease Expiration	Renewal Option, if any
Middle Georgia	$	60,000	October 31, 2022	None
Warrenton	$	55,724	June 30, 2026	Term may be extended for one additional ten-year term.
Goodwill ⁽²⁾	$	40,125	February 1, 2027	Term may be extended for one additional five-year term.
Edwards Redeemer	$	48,728	October 31, 2022	Term may be extended for one additional five-year term.
Providence	$	42,519	June 30, 2026	Term may be extended for one additional ten-year term.
Meadowview ⁽³⁾	$	-	October 31, 2023	Term may be extended for one additional five-year term.
GL Nursing ⁽⁴⁾	$	-	-	None
Glen Eagle ⁽⁵⁾	$	-	-	None
Southern Hills SNF ⁽⁶⁾	$	37,000	May 31, 2019	Term may be extended for one additional five-year term.
Southern Hills ALF ⁽⁷⁾		-	-	None
Southern Hills ILF ⁽⁸⁾		-	-	None

(1) Monthly lease income reflects rent income on a straight-line basis over, where applicable, the term of each lease.

(2) In January 2016, the Goodwill facility was closed by Georgia regulators and all residents were removed. In a transaction related to the sale of the Greene Point facility, an affiliate of the buyer of Greene Point executed a ten year operating lease covering Goodwill. After investing approximately $2.0 million in capital improvements in the property, the lease operator obtained all regulatory approvals and began admitting patients in December 2016. The lease became effective on February 1, 2017, and the facility began generating rental revenue thereafter.

(3) The lease was generating $33,000 in monthly gross rent; however, the operator experienced adverse results in late 2017 and throughout 2018. In April 2018 the Company recognized a bad debt expense of $56,000 related to rent receivables previously booked in 2018 at the Meadowview facility. Effective December 1, 2018, the Company completed the operations transfer to an affiliate of Infinity Health Interests, LLC (“Infinity”). The lease is structured with a lower base rent component than the prior operator but also includes occupancy-based escalators that will better align facility operations with future rental payments.

(4) Effective January 1, 2016, the GL Nursing facility was leased to another operator for a period of ten years at a monthly base rent of $30,000 which was subject to increases based on census levels. Under the terms of the lease, the Company agreed to fund certain capital expenditures, which it was unable to fulfill. In July 2016, the new tenant served notice that it was terminating the lease effective August 31, 2016. The Company entered into a Lease Termination Agreement under which it paid the tenant $145,000 and is obligated to make future payments. Effective August 30, 2016, the Company entered into a new lease agreement with another nursing home operator. The lease term was to commence at the end of a straddle period. During the straddle period, the Company made working capital advances to enable the operator to cover cash flow deficits resulting from initial operations of the facility. Prior to the end of the straddle period, the lease operator informed the Company that it would vacate the facility. An entity affiliated with Mr. Brogdon, who is a guarantor of the mortgage, assumed operations of the facility in March 2018 under an OTA. We do not expect the facility to generate any future revenue for the Company.

(5) The Company entered into a management agreement with Cadence Healthcare Solutions to operate Glen Eagle after expending approximately $1.0 million in capital improvements. The facility passed its licensure survey and began admitting patients in June 2018. Effective October 12, 2018, the facility gained its certification and started collecting revenues from Medicare and Medicaid in April 2019.

(6) Lease agreement dated May 21, 2014 with lease payments commencing February 1, 2015. On May 10, 2016, the Company obtained a Court Order appointing a Receiver to control and operate the Southern Hills SNF. The former lease operator represented that it was unable to meet the financial commitments of the facility, including the payment of rent, payroll and other operating requirements. In October 2017, the Receiver engaged a new manager for the facility at the request of the Company.

(7) The Company plans to operate the Southern Hills ALF through a third-party manager once construction is complete and a state license is secured.

(8) The Company plans to operate the Southern Hills ILF through a third-party manager once renovations are complete. The first residents are expected in July 2019.

Lessees are responsible for payment of insurance, taxes and other charges while under the lease. Should the lessees not pay all such charges as required under the leases, or if there is no tenant, the Company may become liable for such operating expenses. We have been required to cover those expenses at Glen Eagle as well as the Southern Hills ALF and ILF.

Future cash payments for rent to be received during the initial terms of the leases for the next five years and thereafter are as follows (excludes Abbeville, Southern Tulsa ALF and Southern Tulsa ILF due to property being non-operating, and GL Nursing):

Years

2018	$	2,345,240
2019		3,126,946
2020		3,183,242
2021		3,015,544
2022		1,922,794
2023 and Thereafter		5,120,111

	$	18,713,877

10. FAIR VALUE MEASUREMENTS

Financial assets and liabilities recorded at fair value in our consolidated balance sheets are categorized based upon a fair value hierarchy established by GAAP, which prioritizes the inputs used to measure fair value into the following levels:

Level 1— Quoted market prices in active markets for identical assets or liabilities at the measurement date.

Level 2— Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable and can be corroborated by observable market data.

Level 3— Inputs reflecting management’s best estimates and assumptions of what market participants would use in pricing assets or liabilities at the measurement date. The inputs are unobservable in the market and significant to the valuation of the instruments.

A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

Our consolidated balance sheets include the following financial instruments: cash and cash equivalents, advances to related parties, notes receivable, restricted cash, accounts payable, debt and lease security deposit. We consider the carrying values of our short-term financial instruments to approximate fair value because they generally expose the Company to limited credit risk, because of the short period of time between origination of the financial assets and liabilities and their expected settlement, or because of their proximity to acquisition date fair values. The carrying value of debt approximates fair value based on borrowing rates currently available for debt of similar terms and maturities.

Upon acquisition of real estate properties, the Company determines the total purchase price of each property and allocates this price base on the fair value of the tangible assets and intangible assets, if any, acquired and any liabilities assumed based on Level 3 inputs. These Level 3 inputs can include comparable sales values, discount rates, and capitalization rate assumptions from a third party appraisal or other market sources.

Assets and liabilities measured at fair value on a recurring basis as of March 31, 2019 and December 31, 2018 are summarized below:

			Fair Value Measurement
	Total		Level 1		Level 2		Level 3

Warrant Liability	$	2,682	$	-	$	-	$	2,682
Investment in Debt Securities		12,134		12,134		-		-

Fair Value at March 31, 2019	$	14,816	$	12,134	$	-	$	2,682

Warrant Liability	$	2,785	$	-	$	-	$	2,785
Investment in Debt Securities		162,106		162,106		-		-

Fair Value at December 31, 2018	$	164,891	$	162,106	$	-	$	2,785

Because these warrants have full reset adjustments tied to future issuance of equity securities by the Company, it is subject to derivative liability treatment under ASC 815-40-15.

The warrant liability is marked-to-market each reporting period with the change in fair value recorded as a gain or loss within Other (Income) Expense on the Company’s Consolidated Statement of Operations until the warrants are exercised, expire, or other facts and circumstances lead the warrant liability to be reclassified as an equity instrument. The fair value of the warrant liability is determined each reporting period by utilizing the Black-Scholes option pricing model.

The investments in debt securities are recorded at amortized cost since they are considered held-to-maturity.

The table presented below is a summary of changes in the fair value of the Company’s Level 3 valuation for the three months ended March 31, 2019 and 2018:

	2019			2018

Beginning Balance January 1	$	2,785		$	95,371

Change in Fair Value of Warrant Liability		(103	)		(40,423	)

Ending Balance, March 31	$	2,682		$	54,948

The significant assumptions used in the Black-Scholes option pricing model as of March 31, 2019 and December 31, 2018 include the following:

	March 31, 2019			December 31, 2018

Volatility		147.43	%		63.58% - 91.93	%
Risk-free Interest Rate		2.44	%		2.36% - 2.59	%
Exercise Price	$	1.37		$	0.75 - 1.37
Fair Value of Common Stock	$	0.33		$	0.33
Expected Life		0.49 years			0.45 – 0.99 years

11. SEGMENT REPORTING

The Company had two primary reporting segments during the three months ended March 31, 2019, which include real estate services and healthcare services. The Company reports segment information based on the “management approach” defined in ASC 280, Segment Reporting. The management approach designates the internal reporting used by management for making decisions and assessing performance as the source of our reportable segments.

Total assets for the healthcare services and real estate services segments were $561,376 and $37,927,933, respectively, as of March 31, 2019 and $145,260 and $38,150,627, respectively, as of December 31, 2018.

	Statements of Operations Items for the Three Months Ended
	March 31, 2019								March 31, 2018
	Real Estate Services			Healthcare Services		Consolidated			Real Estate Services			Healthcare Services			Consolidated
Rental Revenue	$	895,288		$	-	$	895,288		$	812,065		$	-		$	812,065
Healthcare Revenue		-			379,791		379,791			-			-			-
Total Revenue		895,288			379,791		1,275,079			812,065			-			812,065
Expenses
General and Administrative		112,215			81,264		193,479			104,926			40,229			145,155
Property Taxes, Insurance and Other Operating		62,655			286,533		349,188			22,203			58,613			80,816
Depreciation		319,456			3,469		322,925			305,410			-			305,410
Total Expenses		494,326			371,266		865,592			432,539			98,842			531,381
Income (Loss) from Operations		400,962			8,525		409,487			379,526			(98,842	)		280,684
Other (Income) Expense
Gain on Warrant Liability		(103	)		-		(103	)		(40,423	)		-			(40,423	)
Gain on Extinguishment of Debt		-			-		-			(94,925	)		-			(94,925	)
(Gain) Loss on Settlement of Other Liabilities		-			-		-			29,900			-			29,900
Gain on Sale of Investments		(1,069	)		-		(1,069	)
Gain from Insurance Claim		(270,264	)		-		(270,264	)
Interest Income		(5,467	)		-		(5,467	)		-			-			-
Interest Expense		526,235			-		526,235			598,366			-			598,366
Total Other (Income) Expense		249,332			-		249,332			492,918			-			492,918
Net Income (Loss)		151,630			8,525		160,155			(113,392	)		(98,842	)		(212,234	)
Net Loss Attributable to Noncontrolling Interests		4,141			-		4,141			7,901			-			7,901
Net Income (Loss) Attributable to Global Healthcare REIT, Inc.	$	155,771		$	8,525	$	164,296		$	(105,491	)	$	(98,842	)	$	(204,333	)

12. LEGAL PROCEEDINGS

The Company and/or its affiliated subsidiaries are involved in the following litigation:

Bailey v. GL Nursing, LLC, et. al in the Circuit Court of Lonoke County, Arkansas, 23rd Circuit, 43CV-19-151.

As we simply were the owners of the property and not the operators, we believe that primary responsibility, if any, falls with the operator at the time. Under the terms of the lease, the operator has a duty to indemnify the Company, a claim which we intend to assert.

While it is too early to assess the Company’s exposure, we believe at this time that the likelihood of an adverse outcome is remote.

Southern Tulsa, LLC v. Healthcare Management of Oklahoma, LLC, District Court of Tulsa County, State of Oklahoma, Case No. CJ – 2016- 01781.

This matter was brought by us to have the appointment of a Receiver for the Southern Tulsa SNF and to recover damages from our former operator at that facility. The Court has ordered the appointment of a Receiver effective May 10, 2016. Other claims and matters are pending.

Thomas v. Edwards Redeemer Property Holdings, LLC, et.al., District Court for Oklahoma County, Oklahoma, Case No. CJ 2016-2160.

This action arises from a personal injury claim brought by heirs of a former resident of our Edwards Redeemer facility. We are entitled to indemnification from the lease operator and should be covered under the lease operator’s general liability policy. As we are not the operators of the facility and believe we have indemnity coverage, we believe we have no exposure. The lease operator’s insurance carrier is providing a defense and indemnity; and as a result we believe the likelihood of a material adverse result is remote.

13. SUBSEQUENT EVENTS

On April 12, 2019, the Company entered into a definitive Asset Purchase Agreement to acquire the Higher Call Nursing Center in Quapaw, Oklahoma. The transaction is subject to numerous conditions such as completing our due diligence, financing, completion of the operations transfer agreement, and is not closed as of the date of this report.

On April 15, 2019, the Company executed an Amendment No. 1 to Employment Agreement (the “Amendment”), with an effective date of April 1, 2019, with Zvi Rhine. Pursuant to the Amendment, the Company granted Mr. Rhine a bonus for 2018 services in the amount of $90,000 payable in shares of restricted common stock. The shares were valued at $0.33 per share (the closing price of the Company’s stock on April 2, 2019), resulting in 272,727 shares of Common Stock. The Amendment also defines a Bonus Plan for Mr. Rhine for future periods which provides for additional incentive compensation if certain performance milestones are achieved.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following “Management’s Discussion and Analysis of Financial Condition and Results of Operations” should be read in conjunction with our interim financial statements and notes thereto contained elsewhere in this report. This section contains forward-looking statements, including estimates, projections, statements relating to our business plans, objectives and expected operating results, and the assumptions upon which those statements are based. These forward-looking statements generally are identified by the words “believes,” “project,” “expects,” “anticipates,” “estimates,” “intends,” “strategy,” “plan,” “may,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. Forward-looking statements that were true at the time made may ultimately prove to be incorrect or false. We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. All forward-looking statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 as filed with the SEC.

Our actual future results and trends may differ materially from expectations depending on a variety of factors discussed in our filings with the SEC. These factors include without limitation:

● macroeconomic conditions, such as a prolonged period of weak economic growth, and volatility in capital markets;

● changes in national and local economic conditions in the real estate and healthcare markets specifically;

● legislative and regulatory changes impacting the healthcare industry, including the implementation of the healthcare reform legislation enacted in 2010;

● the availability of debt and equity capital;

● changes in interest rates;

● competition in the real estate industry; and,

● the supply and demand for operating properties in our market areas.

Overview

Global Healthcare REIT, Inc. (“Global” or “we” or the “Company”) was organized for the purpose of investing in real estate related to the long-term care industry.

We plan to elect to be treated as a real estate investment trust (REIT) in the future; however, we did not make that election for the 2019 fiscal year.

We acquire, develop, lease, manage and dispose of healthcare real estate, and provide financing to healthcare providers. Our portfolio will be comprised of investments in the following five healthcare segments: (i) senior housing, (ii) life science, (iii) medical office, (iv) post-acute/skilled nursing and (v) hospital. We will make investments within our healthcare segments using the following five investment products: (i) properties under lease, (ii) debt investments, (iii) developments and redevelopments, (iv) investment management and (v) the Housing and Economic Recovery Act of 2008 (“RIDEA”), which represents investments in senior housing operations utilizing the structure permitted by RIDEA.

The delivery of healthcare services requires real estate and, as a result, tenants and operators depend on real estate, in part, to maintain and grow their businesses. We believe that the healthcare real estate market provides investment opportunities due to the following:

●	Compelling demographics driving the demand for healthcare services;
●	Specialized nature of healthcare real estate investing; and
●	Ongoing consolidation of a fragmented healthcare real estate sector.

Acquisitions

We did not acquire any properties during the three month periods ended March 31, 2019 and 2018.

Properties

As of March 31, 2019, we owned eleven long-term care facilities including a campus of three buildings in Tulsa, OK. The following table provides summary information regarding these facilities at March 31, 2019:

Property Name	Location	Effective Percentage Equity Ownership			Date Acquired	Gross Square Feet		Purchase Price		Outstanding Debt at March 31, 2019

Middle GA Nursing Home (a/k/a Crescent Ridge)	Eastman, GA		100	%	3/15/2013		28,808	$	5,000,000	$	3,533,486

Warrenton Health and Rehabilitation	Warrenton, GA		100	%	12/31/2013		26,894	$	3,500,000	$	2,270,447

Southern Hills Retirement Center	Tulsa, OK		100	%	2/7/2014		104,192	$	2,000,000	$	7,105,218

Goodwill Nursing Home	Macon, GA		85	%	5/19/2014		46,314	$	7,185,000	$	4,355,739

Edwards Redeemer Health & Rehab	Oklahoma City, OK		100	%	9/16/2014		31,939	$	3,142,233	$	2,118,284

Providence of Sparta Nursing Home	Sparta, GA		100	%	9/16/2014		19,441	$	2,836,930	$	2,961,250

Meadowview Healthcare Center	Seville, OH		100	%	9/30/2014		27,500	$	3,000,000	$	2,919,900

Grand Prairie Nursing Home	Lonoke, AR		100	%	9/16/2014		40,737	$	6,742,767	$	4,618,006

Glen Eagle Healthcare & Rehab (Formerly Abbeville Health & Rehab)	Abbeville, GA		100	%	5/25/2016		29,393	$	2,100,000	$	3,024,317

Property Name	2019 Base Revenue Per Lease		Operating Lease Expiration

Middle Georgia Nursing Home (a/k/a Crescent Ridge)	$	720,000		October 31, 2022
Warrenton Health and Rehabilitation	$	642,846		June 30, 2026
Southern Hills Retirement Center	$	78,000		May 31, 2019
Goodwill Nursing Home	$	560,138		February 1, 2027
Edwards Redeemer Health & Rehab	$	574,958		October 31, 2022
Providence of Sparta Nursing Home	$	494,496		June 30, 2026
Meadowview Healthcare Center	$	-		November 30, 2023
GL Nursing Home	$	-		-
Abbeville Health & Rehab	$	-		-

Going Concern

The accompanying consolidated financial statements and notes have been prepared assuming the Company will continue as a going concern. For the three months ended March 31, 2019, the Company had net income of $160,155 and reported net cash provided by operations of $266,139. During the years ended December 31, 2018 and December 31, 2017, the Company incurred net losses of $2,007,006 and $3,001,618, respectively, and as of March 31, 2019 has an accumulated deficit of $10,913,810. These circumstances raise substantial doubt as to the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon the Company’s ability to generate sufficient revenues and cash flows to operate profitably and meet contractual obligations, or raise additional capital through debt financing or through sales of common stock.

Results of Operations

The following discussion of the financial condition, results of operations, cash flows, and changes in our financial position should be read in conjunction with our interim consolidated financial statements and related notes appearing elsewhere in this Quarterly Report on Form 10-Q.

Results of Operations - Three months Ended March 31, 2019 Compared to the Three months Ended March 31, 2018

Rental revenues for the three month periods ended March 31, 2019 and 2018 totaled $895,288 and $812,065, respectively, an increase of $83,223. The Company also had healthcare revenue of $379,791 for the three months ended March 31, 2019, compared to $0 for the three months ended March 31, 2018, related to the commencement of operations at the Glen Eagle facility in Abbeville, GA. Looking forward, we expect to commence operations at the Southern Hills ILF facility in 2019 which we expect to contribute more meaningfully to healthcare revenues as the year progresses, as we expect to be the operator of that facility with a manager. We also expect Meadowview to begin paying rent in 2019 with material upside if certain occupancy-based escalators are triggered.

For the three months ended March 31, 2019, we recognized rental revenues on seven properties, with no revenues recognized from our assisted living facility and independent living facility located in Tulsa, Oklahoma the GL Nursing facility in Lonoke, AR or the Meadowview facility in Seville, OH.

General and administrative expenses were $193,479 and $145,155 for the three month periods ended March 31, 2019 and 2018, respectively, an increase of $48,324. For the three months ended March 31, 2019 and March 31, 2018, respectively, general and administrative expenses included $50,529 and $45,000 of share based compensation related to restricted stock and common stock awards.

Property taxes, insurance, and other operating expenses totaled $349,188 and $80,816 for the three month periods ended March 31, 2019 and 2018, respectively. Lessees are responsible for the payment of insurance, taxes and other charges while under the lease. Should the lessee not pay all such charges, as required under the leases, we may be liable for such operating expenses. We have been required to cover these expenses at our Abbeville facility as we fund the initial working capital needs to stabilize the operations. We are also responsible for property taxes and insurance related to the ALF and ILF at our Southern Hills Retirement Center.

Depreciation expense increased $17,515 from $305,410 for the three months ended March 31, 2018 to $322,925 for three months ended March 31, 2019. We have not recorded depreciation expense on our assisted living facility and independent living facility located at our Southern Hills Retirement Center which will commence once renovations have been completed and the properties are placed in service.

The Company had $5,467 interest income for the three months ended March 31, 2019 and no interest income for the three months ended March 31, 2018.

Interest expense decreased $72,131 from $598,366 for the three months ended March 31, 2018 to $526,235 for the three months ended March 31, 2019. We capitalized $14,525 of interest during the three months ended March 31, 2019.

Liquidity and Capital Resources

Throughout its history, the Company has experienced shortages in working capital and has relied, from time to time, upon sales of debt and equity securities to meet cash demands generated by our acquisition activities.

Our liquidity is expected to increase from potential equity and debt offerings and decrease as net offering proceeds are expended in connection with our various property improvement projects. Our continuing short-term liquidity requirements consisting primarily of operating expenses and debt service requirements, excluding balloon payments at maturity, are expected to be achieved from rental revenues received and existing cash on hand. We plan to renew secured obligations that mature during 2019, as our projected cash flow from operations will be insufficient to retire the debt. Our restricted cash approximated $228,515 as of March 31, 2019 and is to be expended on debt service, taxes, repairs, and capital expenditures associated with Providence of Sparta Nursing Home.

Cash provided by operating activities was $266,139 for the three months ended March 31, 2019 compared to cash provided by operating activities of $208,320 for the three months ended March 31, 2018. Cash flows from operations were impacted by the decrease in expenses and accounts receivable, and the increase in rental revenues received and accounts payable during the first three months of 2019.

Cash used in investing activities was $954,879 for the three-month period ended March 31, 2019 compared to cash used in investing activities of $178,021 for the three month period ended March 31, 2018. The increase reflects increased spending on property renovations and refurbishments.

Cash used financing activities was $3,828 for the three months ended March 31, 2019 compared to cash used in financing activities of $87,086 for the three months ended March 31, 2018. During the first three months of 2019, we issued $159,875 in debt and made payments on debt of $147,318. During the first three months of 2018, we issued $52,862 in debt in cash and made cash payments on debt of $132,448.

As of March 31, 2019 and December 31, 2018, our debt balances consisted of the following:

	March 31, 2019			December 31, 2018

Senior Secured Promissory Notes	$	1,485,000		$	1,485,000
Senior Unsecured Promissory Notes		300,000			300,000
Senior Secured Promissory Notes - Related Parties		875,000			875,000
Fixed-Rate Mortgage Loans		20,902,663			21,049,981
Variable-Rate Mortgage Loans		4,618,006			4,618,006
Line of Credit		7,385,978			7,240,183
Other Debt		1,536,000			1,536,000

		37,102,647			37,104,170

Premium, Unamortized Discount and Debt Issuance Costs		(483,590	)		(507,829	)

	$	36,619,057		$	36,596,341

As presented in the Consolidated Balance Sheets:

Debt, Net	$	35,744,057		$	35,721,341

Debt - Related Parties, Net		875,000			875,000

	$	36,619,057		$	36,596,341

The weighted average interest rate and term of our fixed rate debt are 6.14% and 3.88 years, respectively, as of March 31, 2019. The weighted average interest rate and term of our variable rate debt are 7% and 18.36 years, respectively, as of March 31, 2019.

Mortgage Loans and Lines of Credit Secured by Real Estate

Mortgage loans and other debts such as lines of credit here are collateralized by all assets of each nursing home property and an assignment of its rents. Collateral for certain mortgage loans includes the personal guarantee of Christopher Brogdon or corporate guarantees. Mortgage loans for the periods presented consisted of the following:

	Face		Principal Outstanding at				Stated Interest	Maturity
Property	Amount		March 31, 2019		December 31, 2018		Rate	Date

Southern Hills Retirement Center Line of Credit ⁽¹⁾⁽²⁾	$	7,229,052	$	7,105,218	$	7,119,743	5.25% Fixed		April 28, 2019
Middle Georgia Nursing Home ^(2,3)		3,570,000		3,533,486		3,561,461	5.50% Fixed		October 26, 2021
Goodwill Nursing Home ⁽²⁾		5,005,000		4,355,739		4,390,082	5.50% Fixed		March 19, 2020
Warrenton Nursing Home ⁽⁴⁾		2,720,000		2,270,447		2,287,323	5.50% Fixed		January 20, 2020
Edward Redeemer Health & Rehab		2,303,815		2,118,284		2,138,128	5.50% Fixed		January 16, 2020
Glen Eagle Health & Rehab ⁽⁵⁾		2,761,250		2,743,557		2,761,250	5.50% Fixed		May 25, 2021
Glen Eagle Health and Rehab Line of Credit ⁽²⁾⁽⁵⁾		400,000		280,760		120,440	6.50% Fixed		September 30, 2019
Providence of Sparta Nursing Home ⁽⁶⁾		3,039,300		2,961,250		2,975,337	3.88% Fixed		November 1, 2047
Meadowview Healthcare Center ⁽⁷⁾		3,000,000		2,919,900		2,936,400	6.00% Fixed		October 30, 2022
GL Nursing Home ⁽⁸⁾		5,000,000		4,618,006		4,618,006	Prime Plus 1.50%/ 5.75% Floor		August 3, 2037

			$	32,906,647	$	32,908,170

(3) The loan at Middle Georgia was renewed on November 26, 2018 with the maturity extended to October 26, 2021.

We have $8.9 million of debt maturing and expect principal reduction payments of approximately $391,661 in the year ended December 31, 2019. There is also $10.3 million in debt in technical default maturing after December 31, 2019 but shown due immediately. While we anticipate being able to refinance all the loans at reasonable market terms upon maturity, inability to do so may impact our financial position and results of operations. We expect to refinance $7.4 million in mortgage loans maturing in 2019 as the associated properties meet loan to value requirements currently being employed in commercial lending markets. We have $125,000 in note obligations maturing in 2019. The following is a summary of our subordinated debt and corporate debt at March 31, 2019 and December 31, 2018:

Subordinated and Corporate Debt

Our subordinated debt at March 31, 2019 and December 31, 2018 includes unsecured notes payable issued to entities controlled by the Company used to facilitate the acquisition of the nursing home properties.

Face

Principal Outstanding at

Stated Interest

Maturity

Property

Amount

March 31, 2019

December 31, 2018

Rate

Date

Goodwill Nursing Home

2,180,000

1,536,000

13% ⁽¹⁾ Fixed

December 31, 2019

(1)

Our corporate debt at March 31, 2019 and December 31, 2018 includes unsecured notes and notes secured by all assets of the Company not serving as collateral for other notes.

	Face		Principal Outstanding at,				Stated Interest	Maturity
Series	Amount		March 31, 2019		December, 31, 2018		Rate	Date

10% Senior Secured Promissory Note	$	125,000	$	125,000	$	125,000	10.0% Fixed		December 31, 2018
10% Senior Unsecured Promissory Notes		300,000		300,000		300,000	10.0% Fixed		October 31, 2020
11% Senior Secured Promissory Notes		2,235,000		2,235,000		2,235,000	11.0% Fixed		October 31, 2021

			$	2,660,000	$	2,660,000

Contractual Obligations

As of March 31, 2019, we had the following contractual obligations:

	Total		Less Than 1 Year		1 – 3 Years		3 – 5 Years		More Than 5 Years
Notes and Bonds Payable - Principal	$	37,102,647	$	28,239,408	$	6,076,830	$	131,824	$	2,654,585
Notes and Bonds Payable - Interest		3,760,500		1,228,060		919,692		211,390		1,401,358

Total Contractual Obligations	$	40,863,147	$	29,467,468	$	6,996,522	$	343,214	$	4,055,943

Revenues from operations are sufficient to meet the working capital needs of the Company for the foreseeable future. Cash on hand, combined proceeds from the issuance of our Senior Secured Promissory Notes in the aggregate amount of $1,160,000 during 2018 and revenues generated from operations are in excess of operating expenses and debt service requirements. Debt maturities are expected to be refinanced at reasonable terms upon maturity. The Company anticipates a combination of conventional mortgage loans, at market rates, issuance of revenue bonds and possibly additional equity injections to fund the acquisition cost of any additional properties. Except for renovations at Southern Hills Retirement Center, there are no material capital improvement or recurring capital expenditure commitments at the properties.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that we consider material.

Critical Accounting Policies

Set forth below is a summary of the accounting policies that management believes are critical to the preparation of the consolidated financial statements. Certain of these accounting policies are particularly important for an understanding of the financial position and results of operations presented in the consolidated financial statements set forth elsewhere in this report. These policies require the application of judgment and assumptions by management and, as a result, are subject to a degree of uncertainty. Actual results could differ as a result of such judgment and assumptions.

Property Acquisitions

We allocate the purchase price of acquired properties to net tangible and identified intangible assets and any liabilities based on relative fair values. Fair value estimates are based on information obtained from independent appraisals, other market data, information obtained during due diligence and information related to the marketing and leasing at the specific property. Acquisition-related costs such as due diligence, legal and accounting fees are expensed as incurred and not applied in determining the purchase price or fair value of an acquired property.

Impairment of Long Lived Assets

When circumstances indicate the carrying value of property may not be recoverable, the Company reviews the asset for impairment. This review is based on an estimate of the future undiscounted cash flows, excluding interest charges, expected to result from the property’s use and eventual disposition. This estimate considers factors such as expected future operating income, market and other applicable trends and residual value, as well as the effects of leasing demand, competition and other factors. If impairment exists, due to the inability to recover the carrying amount of the property, an impairment loss is recorded to the extent that the carrying value exceeds the estimated fair value of the property. Estimated fair value is determined with the assistance from independent valuation specialists using recent sales of similar assets, market conditions and projected cash flows of properties using standard industry valuation techniques.

Recently Adopted Accounting Pronouncements

Recently Issued Accounting Pronouncements

The Financial Accounting Standards Board and other entities issued new or modifications to, or interpretations of, existing accounting guidance during 2018. Management has carefully considered the new pronouncements that altered generally accepted accounting principles and does not believe that any other new or modified principles will have a material impact on the Company’s reported financial position or operations in the near term.

Subsequent Events

On April 15, 2019, the Company executed an Amendment No. 1 to Employment Agreement (the “Amendment”), with an effective date of April 1, 2019, with Zvi Rhine. Pursuant to the Amendment, the Company granted Mr. Rhine a bonus for 2018 services in the amount of $90,000 payable in shares of restricted common stock. The shares were valued at $0.33 per share (the closing price of the Company’s stock on April 2, 2019), resulting in 272,727 shares of Common Stock. The Amendment also provides for an incentive bonus program for future periods subject to meeting certain performance milestones.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

ITEM 4. CONTROLS AND PROCEDURES

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, as appropriate, to allow timely decisions regarding required disclosure. Management necessarily applied its judgment in assessing the costs and benefits of such controls and procedures, which, by their nature, can provide only reasonable assurance regarding management’s control objectives.

Our management, including our CEO and CFO, evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this Report. Based on this evaluation, our CEO and CFO concluded that the design and operation of our disclosure controls and procedures were not effective as of such date to provide assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC, and that such information is accumulated and communicated to management as appropriate, to allow timely decisions regarding disclosures.

There was no change in our internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) that occurred during the quarter ended March 31, 2019, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II

OTHER INFORMATION

Item 1. Legal Proceedings

The Company and/or its affiliated subsidiaries are involved in the following litigation:

Bailey v. GL Nursing, LLC, et.al. in the in the Circuit Court of Lonoke County, Arkansas, 23rd Circuit, 43CV-19-151.

The Company’s wholly owned subsidiary, was named as a co-defendant in the action arising out of a claimed personal injury suffered by the plaintiff while a resident of the skilled nursing home owned, but not operated, by GL Nursing. As of this date, we have engaged legal counsel but have no further information is known regarding the merits of the claim. After initial inquiry, it does not appear that the lease operator of the facility had in effect general liability insurance covering the GL Nursing, as landlord, as required by the operating lease. As we simply were the owners of the property and not the operators, we believe that primary responsibility, if any, falls with the operator at the time. Under the terms of the lease, the operator has a duty to indemnify the Company, a claim which we intend to assert.

While it is too early to assess the Company’s exposure, we believe at this time that the likelihood of an adverse outcome is remote.

Southern Tulsa, LLC v. Healthcare Management of Oklahoma, LLC, District Court of Tulsa County, State of Oklahoma, Case No. CJ – 2016- 01781.

Thomas v. Edwards Redeemer Property Holdings, LLC, et.al., District Court for Oklahoma County, Oklahoma, Case No. CJ 2016-2160.

Item 1A. Risk Factors

None, except as previously disclosed.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None, except as previously disclosed, such as the 272,727 shares of restricted common stock granted to Mr. Zvi Rhine as a bonus for services in 2018, and effective March 1, 2019, we issued 90,909 shares of common stock to each of Baller, Desmond and Neuman under the Directors’ Compensation Plan.

Item 3. Defaults Upon Senior Securities

None, except as disclosed in this Report.

Item 4. Removed and Reserved

Item 5. Other Information

None.

Item 6. Exhibits

31.1		Certification of Chief Executive Officer Pursuant to Section 302 of Sarbanes-Oxley Act of 2002*

31.2		Certification of Chief Financial Officer Pursuant to Section 302 of Sarbanes-Oxley Act of 2002*

32.		Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*

101.INS		XBRL Instance Document**
101.SCH		XBRL Schema Document**
101.CAL		XBRL Calculation Linkbase Document**
101.LAB		XBRL Label Linkbase Document**
101.PRE		XBRL Presentation Linkbase Document**
101.DEF		XBRL Definition Linkbase Document**

* filed herewith

** furnished, not filed

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Quarterly Report to be signed on its behalf by the undersigned, thereunto duly authorized.

	GLOBAL HEALTHCARE REIT, INC.

Date: May 20, 2019	By:	/s/ Lance Baller
		Lance Baller, Interim CEO (Principal Executive Officer)

Date: May 20, 2019	By:	/s/ Zvi Rhine
		Zvi Rhine, Chief Financial Officer
		(Principal Accounting Officer)

EX-31.1 2 ex31-1.htm

Exhibit 31.1

CERTIFICATION

I, Lance Baller, Interim Chief Executive Officer, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q of Global Healthcare REIT, Inc.;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.	The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

	(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

	(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

	(c)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

	(d)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.	The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

	(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

	(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 20, 2019	/s/ Lance Baller
	Lance Baller, Interim Chief Executive Officer
	(Principal Executive Officer)

EX-31.2 3 ex31-2.htm

Exhibit 31.2

CERTIFICATION

I, Zvi Rhine, Chief Financial Officer, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q of Global Healthcare REIT, Inc.;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.	The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

	(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

	(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

	(c)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

	(d)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.	The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

	(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

	(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 20, 2019

/s/ Zvi Rhine

Zvi Rhine, Chief Financial Officer

(Principal Accounting Officer)

EX-32 4 ex32.htm

Exhibit 32

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Global Healthcare REIT, Inc. (the "Company") on Form 10-Q for the period ended March 31, 2019, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Lance Baller, Interim Chief Executive Officer (Principal Executive Officer) and I, Zvi Rhine, Chief Financial Officer (Principal Accounting Officer) of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

	(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

	(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/ Lance Baller
Lance Baller
Interim Chief Executive Officer
(Principal Executive Officer)
May 20, 2019

/s/ Zvi Rhine
Zvi Rhine
Chief Financial Officer
(Principal Accounting Officer)
May 20, 2019

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2021-10-26

2020-03-19

2020-01-20

2020-01-16

2047-11-01

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Shares of the Series D preferred stock are redeemable at the Company's option. At the option of the holder, shares of the Series D preferred stock plus any declared and unpaid dividends are convertible to shares of the Company's common stock at a conversion rate of $1.00 per share.

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base salary of $165,000 per year (which accrues beginning January 1, 2018 but payable only after the Company raises capital of at least $600,000), (ii) 150,000 shares of restricted stock vesting one-half each on January 1, 2019 and January 1, 2020,

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The following is a summary of the Company’s debt outstanding as of March 31, 2019 and December 31, 2018:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">December 31, 2018</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 62%; line-height: 107%">Senior Secured Promissory Notes</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 16%; text-align: right; line-height: 107%">1,485,000</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 16%; text-align: right; line-height: 107%">1,485,000</td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Senior Unsecured Promissory Notes</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">300,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">300,000</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Senior Secured Promissory Notes - Related Parties</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">875,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">875,000</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Fixed-Rate Mortgage Loans</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">20,902,663</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">21,049,981</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Variable-Rate Mortgage Loans</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">4,618,006</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">4,618,006</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Line of Credit</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">7,385,978</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">7,240,183</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Other Debt</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">1,536,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">1,536,000</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">37,102,647</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">37,104,170</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Premium, Unamortized Discount and Debt Issuance Costs</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">(483,590</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">(507,829</td> <td style="line-height: 107%">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">36,619,057</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">36,596,341</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">As presented in the Consolidated Balance Sheets:</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Debt, Net</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">35,744,057</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">35,721,341</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Debt - Related Parties, Net</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">875,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">875,000</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">36,619,057</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">36,596,341</td> <td style="line-height: 107%"> </td></tr> </table>

The value of the warrants issued to the note holders was calculated using the Black-Scholes pricing model using the following significant assumptions:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">December 31, 2018</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 77%; line-height: 107%">Volatility</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 20%; text-align: right; line-height: 107%">122% - 123 </td> <td style="width: 1%; line-height: 107%">%</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Risk-free Interest Rate</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2.76% - 2.94</td> <td style="line-height: 107%">%</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Exercise Price</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">0.50</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Fair Value of Common Stock</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">0.30 - $0.35</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Expected Life</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2.9 – 3.0 years</td> <td style="line-height: 107%"> </td></tr> </table>

Mortgage loans for the periods presented consisted of the following:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="text-align: center; line-height: 107%">Face</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Principal Outstanding at</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Stated Interest</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Maturity</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Property</td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Amount</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">December 31, 2018</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Rate</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Date</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 22%; line-height: 107%">Southern Hills Retirement Center Line of Credit (1)(2)</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 10%; text-align: right; line-height: 107%">7,229,052</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 12%; text-align: right; line-height: 107%">7,105,218</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 16%; text-align: right; line-height: 107%">7,119,743</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 14%; text-align: center; line-height: 107%">5.25% Fixed</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 14%; text-align: center; line-height: 107%">April 28, 2019</td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Middle Georgia Nursing Home (2,3)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">3,570,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">3,533,486</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">3,561,461</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">5.50% Fixed</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">October 26, 2021</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Goodwill Nursing Home (2)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">5,005,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">4,355,739</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">4,390,082</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">5.50% Fixed</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">March 19, 2020</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Warrenton Nursing Home (4)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,720,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,270,447</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,287,323</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">5.50% Fixed</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">January 20, 2020</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Edward Redeemer Health & Rehab</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,303,815</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,118,284</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,138,128</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">5.50% Fixed</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">January 16, 2020</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Glen Eagle Health & Rehab (5)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,761,250</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,743,557</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,761,250</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">5.50% Fixed</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">May 25, 2021</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Glen Eagle Health and Rehab Line of Credit (2)(5)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">400,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">280,760</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">120,440</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">6.50% Fixed</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">September 30, 2019</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Providence of Sparta Nursing Home (6)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">3,039,300</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,961,250</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,975,337</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">3.88% Fixed</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">November 1, 2047</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Meadowview Healthcare Center (7)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">3,000,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,919,900</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,936,400</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">6.00% Fixed</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">October 30, 2022</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">GL Nursing Home (8)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">5,000,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">4,618,006</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">4,618,006</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Prime Plus 1.50%/ 5.75% Floor</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">August 3, 2037</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">32,906,647</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">32,908,170</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> </table>

The following table summarizes the restricted stock unit activity during the three months ended March 31, 2019 and 2018.   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2018</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Outstanding Non-Vested Restricted Stock Units, Beginning</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="width: 62%; line-height: 107%">Granted</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 16%; text-align: right; line-height: 107%">272,727</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 16%; text-align: right; line-height: 107%">562,500</td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Vested</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">(68,182</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">(140,625</td> <td style="line-height: 107%">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Outstanding Non-Vested Restricted Stock Units, Ending</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">204,545</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">421,875</td> <td style="line-height: 107%"> </td></tr> </table>

The following table summarizes our leasing arrangements related to the Company’s healthcare facilities at March 31, 2019:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Facility</td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Monthly Lease Income (1)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Lease Expiration</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Renewal Option, if any</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 36%; line-height: 107%">Middle Georgia</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 16%; text-align: right; line-height: 107%">60,000</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 16%; text-align: center; line-height: 107%">October 31, 2022</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 26%; text-align: center; line-height: 107%">None</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Warrenton</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">55,724</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">June 30, 2026</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Term may be extended for one additional ten-year term.</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Goodwill (2)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">40,125</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">February 1, 2027</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Term may be extended for one additional five-year term.</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Edwards Redeemer</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">48,728</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">October 31, 2022</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Term may be extended for one additional five-year term.</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Providence</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">42,519</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">June 30, 2026</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Term may be extended for one additional ten-year term.</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Meadowview (3)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">October 31, 2023</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Term may be extended for one additional five-year term.</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">GL Nursing (4)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">None</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Glen Eagle (5)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">None</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Southern Hills SNF (6)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">37,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">May 31, 2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Term may be extended for one additional five-year term.</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Southern Hills ALF (7)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">None</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Southern Hills ILF (8)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">None</td></tr> </table>   (1) Monthly lease income reflects rent income on a straight-line basis over, where applicable, the term of each lease.   (2) In January 2016, the Goodwill facility was closed by Georgia regulators and all residents were removed. In a transaction related to the sale of the Greene Point facility, an affiliate of the buyer of Greene Point executed a ten year operating lease covering Goodwill. After investing approximately $2.0 million in capital improvements in the property, the lease operator obtained all regulatory approvals and began admitting patients in December 2016. The lease became effective on February 1, 2017, and the facility began generating rental revenue thereafter.   (3) The lease was generating $33,000 in monthly gross rent; however, the operator experienced adverse results in late 2017 and throughout 2018. In April 2018 the Company recognized a bad debt expense of $56,000 related to rent receivables previously booked in 2018 at the Meadowview facility. Effective December 1, 2018, the Company completed the operations transfer to an affiliate of Infinity Health Interests, LLC (“Infinity”). The lease is structured with a lower base rent component than the prior operator but also includes occupancy-based escalators that will better align facility operations with future rental payments.   (4) Effective January 1, 2016, the GL Nursing facility was leased to another operator for a period of ten years at a monthly base rent of $30,000 which was subject to increases based on census levels. Under the terms of the lease, the Company agreed to fund certain capital expenditures, which it was unable to fulfill. In July 2016, the new tenant served notice that it was terminating the lease effective August 31, 2016. The Company entered into a Lease Termination Agreement under which it paid the tenant $145,000 and is obligated to make future payments. Effective August 30, 2016, the Company entered into a new lease agreement with another nursing home operator. The lease term was to commence at the end of a straddle period. During the straddle period, the Company made working capital advances to enable the operator to cover cash flow deficits resulting from initial operations of the facility. Prior to the end of the straddle period, the lease operator informed the Company that it would vacate the facility. An entity affiliated with Mr. Brogdon, who is a guarantor of the mortgage, assumed operations of the facility in March 2018 under an OTA. We do not expect the facility to generate any future revenue for the Company.   (5) The Company entered into a management agreement with Cadence Healthcare Solutions to operate Glen Eagle after expending approximately $1.0 million in capital improvements. The facility passed its licensure survey and began admitting patients in June 2018. Effective October 12, 2018, the facility gained its certification and started collecting revenues from Medicare and Medicaid in April 2019.   (6) Lease agreement dated May 21, 2014 with lease payments commencing February 1, 2015. On May 10, 2016, the Company obtained a Court Order appointing a Receiver to control and operate the Southern Hills SNF. The former lease operator represented that it was unable to meet the financial commitments of the facility, including the payment of rent, payroll and other operating requirements. In October 2017, the Receiver engaged a new manager for the facility at the request of the Company.   (7) The Company plans to operate the Southern Hills ALF through a third-party manager once construction is complete and a state license is secured.    (8) The Company plans to operate the Southern Hills ILF through a third-party manager once renovations are complete. The first residents are expected in July 2019. Future cash payments for rent to be received during the initial terms of the leases for the next five years and thereafter are as follows (excludes Abbeville, Southern Tulsa ALF and Southern Tulsa ILF due to property being non-operating, and GL Nursing):   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Years</td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 79%; text-align: center; line-height: 107%">2018</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 18%; text-align: right; line-height: 107%">2,345,240</td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: center; line-height: 107%">2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">3,126,946</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: center; line-height: 107%">2020</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">3,183,242</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: center; line-height: 107%">2021</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">3,015,544</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: center; line-height: 107%">2022</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">1,922,794</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: center; line-height: 107%">2023 and Thereafter</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">5,120,111</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">18,713,877</td> <td style="line-height: 107%"> </td></tr> </table>

Assets and liabilities measured at fair value on a recurring basis as of March 31, 2019 and December 31, 2018 are summarized below:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="10" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Fair Value Measurement</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Total</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Level 1</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Level 2</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Level 3</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 48%; line-height: 107%">Warrant Liability</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 10%; text-align: right; line-height: 107%">2,682</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 10%; text-align: right; line-height: 107%">-</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 10%; text-align: right; line-height: 107%">-</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 10%; text-align: right; line-height: 107%">2,682</td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Investment in Debt Securities</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">12,134</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">12,134</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Fair Value at March 31, 2019</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">14,816</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">12,134</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">2,682</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Warrant Liability</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">2,785</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">2,785</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Investment in Debt Securities</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">162,106</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">162,106</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Fair Value at December 31, 2018</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">164,891</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">162,106</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">2,785</td> <td style="line-height: 107%"> </td></tr> </table>

The table presented below is a summary of changes in the fair value of the Company’s Level 3 valuation for the three months ended March 31, 2019 and 2018:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">2018</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 72%; line-height: 107%">Beginning Balance January 1</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 11%; text-align: right; line-height: 107%">2,785</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 11%; text-align: right; line-height: 107%">95,371</td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Change in Fair Value of Warrant Liability</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">(103</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">(40,423</td> <td style="line-height: 107%">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Ending Balance, March 31</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">2,682</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">54,948</td> <td style="line-height: 107%"> </td></tr> </table>

The significant assumptions used in the Black-Scholes option pricing model as of March 31, 2019 and December 31, 2018 include the following:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">December 31, 2018</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 54%; line-height: 107%">Volatility</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 20%; text-align: right; line-height: 107%">147.43</td> <td style="width: 1%; line-height: 107%">%</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 20%; text-align: right; line-height: 107%">63.58% - 91.93</td> <td style="width: 1%; line-height: 107%">%</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Risk-free Interest Rate</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2.44</td> <td style="line-height: 107%">%</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2.36% - 2.59</td> <td style="line-height: 107%">%</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Exercise Price</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">1.37</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">0.75 - 1.37</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Fair Value of Common Stock</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">0.33</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">0.33</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Expected Life</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">0.49 years</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">0.45 – 0.99 years</td> <td style="line-height: 107%"> </td></tr> </table>

Future maturities and principal reduction payments of all notes and bonds payable listed above for the next five years and thereafter are as follows:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Years</td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 77%; text-align: center; line-height: 107%">2019</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 20%; text-align: right; line-height: 107%">19,659,755</td> <td style="width: 1%; line-height: 107%">(1)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: center; line-height: 107%">2020</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">9,013,714</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: center; line-height: 107%">2021</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">5,626,986</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: center; line-height: 107%">2022</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">64,013</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: center; line-height: 107%">2023</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">66,541</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: center; line-height: 107%">2024 and after</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">2,671,638</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">37,102,647</td> <td style="line-height: 107%"> </td></tr> </table>   (1) Any note or bond that is not in compliance with all financial and non-financial covenants is considered to have an immediate maturity, including those that require compliance with covenants on any and all other notes. The notes secured by the facilities at Meadowview and Abbeville have such covenants which were in technical non-compliance at March 31, 2019, but the Company believes that its relationships with these lenders is good.

Other debt due at March 31, 2019 and December 31, 2018 includes unsecured notes payable issued to entities controlled by the Company used to facilitate the acquisition of the nursing home properties.   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="text-align: center; line-height: 107%">Face</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Principal Outstanding at</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Stated Interest</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Maturity</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Property</td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Amount</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">December 31, 2018</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Rate</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Date</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 22%; line-height: 107%">Goodwill Nursing Home</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 10%; text-align: right; line-height: 107%">2,180,000</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="width: 12%; border-bottom: black 2.25pt double; text-align: right; line-height: 107%">1,536,000</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="width: 16%; border-bottom: black 2.25pt double; text-align: right; line-height: 107%">1,536,000</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 14%; text-align: center; line-height: 107%">13% (1) Fixed</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 14%; text-align: center; line-height: 107%">December 31, 2019</td> <td style="width: 1%; line-height: 107%"> </td></tr> </table>   (1) The subordinated note on Goodwill matured on July 1, 2015. Investors in the Goodwill note were entitled to an additional 5% equity in Goodwill Hunting, LLC every six months if the note is not paid when due. Effective December 31, 2015, the investors holding the subordinated debt executed an Agreement Among Lenders pursuant to which they (i) agreed to waive any and all equity ratchets and (ii) agreed to extend the maturity date of the subordinated debt to June 30, 2017. In exchange, Goodwill Hunting agreed to pay the investors an additional one-time premium equal to 5% of the principal amount of the individual note at such time as the note is repaid. Effective May 3, 2017, we entered into an Allonge and Modification Agreement with the Goodwill investors pursuant to which they agreed to (i) waive all accrued interest through December 31, 2017, (ii) reduce interest rate to 13% beginning January 1, 2018 and (iii) extend the maturity date of the notes to December 31, 2019. In exchange, the Company agreed that upon repayment of the notes, the investors would be entitled to a one-time premium payment in the amount of 15% of the principal balance of the notes.

1546801

200365

400000

0.25 0.80

600000

1160000

600000

111000

900000

1200000

774733

902403

-11070606

-10913810

250000

150000

43260295

1597500

200000

36076632

1469976

3916187

44222549

1597500

200000

36126867

1475923

4822259

5815150

6138075

1560000 1560000

962254

143445

84000

250000

106334

478950

127000

1092400 67600 1075000 875000 1075000

60000

452000

67000

761 78140 7119743 7105218

66541

2671638

37102647

9013714

5626986

64013

204545

421875

272727

562500

P12M

0.36

1922794

33000

151041

<table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="22" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Statements of Operations Items for the Three Months Ended</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="10" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="10" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2018</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Real Estate Services</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Healthcare Services</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Consolidated</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Real Estate Services</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Healthcare Services</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Consolidated</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 46%; line-height: 107%">Rental Revenue</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 6%; text-align: right; line-height: 107%">895,288</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 6%; text-align: right; line-height: 107%">-</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 6%; text-align: right; line-height: 107%">895,288</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 6%; text-align: right; line-height: 107%">812,065</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 6%; text-align: right; line-height: 107%">-</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 6%; text-align: right; line-height: 107%">812,065</td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Healthcare Revenue</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">379,791</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">379,791</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Total Revenue</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">895,288</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">379,791</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">1,275,079</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">812,065</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">812,065</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Expenses</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">General and Administrative</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">112,215</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">81,264</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">193,479</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">104,926</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">40,229</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">145,155</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Property Taxes, Insurance and Other Operating</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">62,655</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">286,533</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">349,188</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">22,203</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">58,613</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">80,816</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Depreciation</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">319,456</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">3,469</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">322,925</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">305,410</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">305,410</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Total Expenses</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">494,326</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">371,266</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">865,592</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">432,539</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">98,842</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">531,381</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Income (Loss) from Operations</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">400,962</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">8,525</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">409,487</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">379,526</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">(98,842</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">280,684</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Other (Income) Expense</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Gain on Warrant Liability</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(103</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(103</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(40,423</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(40,423</td> <td style="line-height: 107%">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Gain on Extinguishment of Debt</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(94,925</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(94,925</td> <td style="line-height: 107%">)</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">(Gain) Loss on Settlement of Other Liabilities</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">29,900</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">29,900</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Gain on Sale of Investments</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(1,069</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(1,069</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Gain from Insurance Claim</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(270,264</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(270,264</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Interest Income</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(5,467</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(5,467</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Interest Expense</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">526,235</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">526,235</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">598,366</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">598,366</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Total Other (Income) Expense</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">249,332</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">249,332</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">492,918</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">492,918</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Net Income (Loss)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">151,630</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">8,525</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">160,155</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(113,392</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(98,842</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(212,234</td> <td style="line-height: 107%">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Net Loss Attributable to Noncontrolling Interests</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">4,141</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">4,141</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">7,901</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">7,901</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Net Income (Loss) Attributable to Global Healthcare REIT, Inc.</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">155,771</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">8,525</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">164,296</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">(105,491</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">(98,842</td> <td style="line-height: 107%">)</td> <td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">(204,333</td> <td style="line-height: 107%">)</td></tr> </table>

-270264

22500

45000

28125

16875

45000

29900

-38085

45979

151041

1100218

386124

105486

614639

915361

94925

268963

-52796

147318

132448

30000

2018-12-31

For every $1.00 in principal amount of note, investors got one warrant exercisable for one year to purchase an additional share of common stock at an exercise price of $.75 per share.

Warrant for each $1.00 in principal amount of Note exercisable for three years to purchase a share of Common Stock at an exercise price of $0.50 per share.

3142586

2714918

427668

71250

0.75 0.60

600000

0.36

0.60

0.57

60000

55724

40125

48728

42519

37000

2022-10-31

2026-06-30

2027-02-01

2022-10-31

2026-06-30

2023-10-31

2019-05-31

None Term may be extended for one additional ten-year term. Term may be extended for one additional five-year term. Term may be extended for one additional five-year term. Term may be extended for one additional ten-year term. Term may be extended for one additional five-year term. None Term may be extended for one additional five-year term None None None

145000

2345240

19659755

Investors in the Goodwill note were entitled to an additional 5% equity in Goodwill Hunting, LLC every six months if the note is not paid when due. Effective December 31, 2015, the investors holding the subordinated debt executed an Agreement Among Lenders pursuant to which they (i) agreed to waive any and all equity ratchets and (ii) agreed to extend the maturity date of the subordinated debt to June 30, 2017.

125000 4704 33124 45047

The Maturity Date was extended from April 30, 2018 to October 30, 2018. The Maturity Date was further extended to February 28, 2019 and subsequently to April 28, 2019, with the intent to convert to an amortizing loan thereafter.

120440

280760

The mortgage loan collateralized by the GL Nursing Home is 80% guaranteed by the USDA and requires an annual renewal fee payable in the amount of 0.25% of the USDA guaranteed portion of the outstanding principal balance as of December 31 of each year.

68182

140625

2785

2682

162106

12134

164891

2785

162106

14816

12134

2682

2785

2682

95371

54948

-103

-40423

29900 29900

1069

-270264 -270264

0.33

272727

5061000

147318

132448

43681

50529

45000

-29900

1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES   Organization and Description of the Business   Global Healthcare REIT, Inc. (the Company or Global) was organized with the intent of operating as a real estate investment trust (REIT) for the purpose of investing in real estate and other assets related to the healthcare industry. Prior to the Company changing its name to Global Healthcare REIT, Inc. on September 30, 2013, the Company was known as Global Casinos, Inc. Global Casinos, Inc. operated two gaming casinos which were split-off and sold on September 30, 2013. Simultaneous with the split-off and sale of the gaming operations, the Company acquired West Paces Ferry Healthcare REIT, Inc. (WPF) in a transaction accounted for as a reverse acquisition whereby WPF was deemed to be the accounting acquirer.   The Company intends to make a REIT election under sections 856 through 859 of the Internal Revenue Code of 1986, as amended. Such election will be made by the Board of Directors at such time as the Board determines that we qualify as a REIT under applicable provisions of the Internal Revenue Code.   The Company acquires, develops, leases, manages and disposes of healthcare real estate, and provides financing to healthcare providers. As of March 31, 2019, the Company owned eleven healthcare properties which are leased or managed by third-party operators under triple-net operating terms.   Basis of Presentation   The accompanying unaudited interim consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP) for interim financial information and in conjunction with the rules and regulations of the Securities Exchange Commission. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments considered necessary to make the consolidated financial statements not misleading have been included. Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the entire year. The unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 filed with the Securities and Exchange Commission.   Recently Adopted Accounting Pronouncements   Effective January 1, 2019, the Company adopted ASU No. 2018-07, Compensation – Stock Based Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-7”), which aligns accounting for share-based payments issued to nonemployees to that of employees under the existing guidance of Topic 718, with certain exceptions. This update supersedes previous guidance for equity-based payments to nonemployees under Subtopic 505-50, Equity – Equity-Based Payments to Non-Employees. The adoption of ASU 2018-07 did not have a material impact on the Company’s consolidated financial statements.   In February 2016, the Financial Accounting Standards Board issued ASU No. 2016-02, “Leases: Topic 842 (ASU 2016-02)”, to supersede nearly all existing lease guidance under GAAP. The guidance would require lessees to recognize most leases on their balance sheets as lease liabilities with corresponding right-of-use assets. ASU 2016-02 is effective for the Company as of January 1, 2019 and adoption requires using a modified retrospective approach with the option to elect certain practical expedients. The Company has determined that it does not have any leases that fall under the guidance of ASU 2016-02 and it had no impact on its consolidated financial statements.   Recently Issued Accounting Pronouncements   The Financial Accounting Standards Board and other entities issued new or modifications to, or interpretations of, existing accounting guidance during 2019. Management has carefully considered the new pronouncements that altered generally accepted accounting principles and does not believe that any other new or modified principles will have a material impact on the Company’s reported financial position or operations in the near term.

2. GOING CONCERN   The accompanying consolidated financial statements and notes have been prepared assuming the Company will continue as a going concern.   For the three months ended March 31, 2019, the Company had net income of $160,155 and reported net cash provided by operations of $266,139. During the years ended December 31, 2018 and December 31, 2017, the Company incurred net losses of $2,007,006 and $3,001,618, respectively, and as of March 31, 2019 has an accumulated deficit of $10,913,810. These circumstances raise substantial doubt as to the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon the Company’s ability to generate sufficient revenues and cash flows to operate profitably and meet contractual obligations, or raise additional capital through debt financing or through sales of common stock.   The failure to achieve the necessary levels of profitability and cash flows or obtain additional funding would be detrimental to the Company. The consolidated financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

3. PROPERTY AND EQUIPMENT   The gross carrying amount and accumulated depreciation of the Company’s property and equipment as of March 31, 2019 and December 31, 2018 are as follows:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">December 31, 2018</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 54%; line-height: 107%">Land</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 20%; text-align: right; line-height: 107%">1,597,500</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 20%; text-align: right; line-height: 107%">1,597,500</td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Land Improvements</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">200,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">200,000</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Buildings and Improvements</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">36,126,867</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">36,076,632</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Furniture, Fixtures and Equipment</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">1,475,923</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">1,469,976</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Construction in Progress</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">4,822,259</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">3,916,187</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">44,222,549</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">43,260,295</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Less Accumulated Depreciation</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(6,138,075</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(5,815,150</td> <td style="line-height: 107%">)</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Less Impairment</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">(1,560,000</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">(1,560,000</td> <td style="line-height: 107%">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">36,524,474</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">35,885,145</td> <td style="line-height: 107%"> </td></tr> </table>   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">For the Three Months Ended March 31,</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">2018</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 54%; line-height: 107%">Depreciation Expense</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 20%; text-align: right; line-height: 107%">322,925</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 20%; text-align: right; line-height: 107%">305,410</td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Cash Paid for Capital Expenditures</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">962,254</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">143,445</td> <td style="line-height: 107%"> </td></tr> </table>

4. INVESTMENTS IN DEBT SECURITIES   At March 31, 2019 and December 31, 2018, the Company held investments in marketable securities that were classified as held-to-maturity and carried at amortized costs. Held-to-maturity securities consisted of the following:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">December 31, 2018</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="width: 54%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 20%; text-align: right; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 20%; text-align: right; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">States and Municipalities</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">12,134</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">162,106</td> <td style="line-height: 107%"> </td></tr> </table>   Contractual maturity of held-to-maturity securities at March 31, 2019 is September 1, 2043, and total value of securities at their respective maturity dates is $30,000. Actual maturities may differ from contractual maturities because some borrowers have the right to call or prepay obligations with or without call or prepayment penalties. The Company received proceeds of $151,041 from the sale of debt securities, and recognized a gain on sale of investments of $1,069 during the three months ended March 31, 2019.

5. NOTES RECEIVABLE   Note Receivable – Receiver for Healthcare Management of Oklahoma, LLC   On May 10, 2016, the Company obtained a Court Order appointing a receiver to control and operate the skilled nursing facility in Southern Hills, Tulsa. The former lease operator represented that it was unable to meet the financial commitments of the facility, including the payment of rent, payroll, and other operating requirements. The transition to the receiver was part of a turnaround effort to restore viable operations at the facility. The Court ordered the Company to provide the receiver a revolving line of credit not to exceed $250,000 of which the Company advanced $150,000 during 2016. The receiver is to repay the revolving unsecured line of credit from the operation or sale of the facility or other sources. The Company has determined the note as no longer being collectible based on the ability to repay and has recorded bad debt expense of $150,000 in the consolidated statements of operations for the year ended December 31, 2016. During November 2017, the Company made a short-term loan in the amount of $84,000 to the operator with the understanding that it would be repaid immediately; the loan was repaid during 2018.   Note Receivable: Accounts Receivable Line of Credit (“ARLOC”) – Infinity Health Interests, LLC   As part of the transition to a new tenant at High Street Nursing facility, the Company committed a $250,000 Accounts Receivable Line of Credit (“ARLOC”) to an affiliate of Infinity Health Interests, LLC (“Infinity”) in order to ensure that no disruptions in management of the facility occur. The ARLOC is secured by a first lien on all the receivables of the facility as well as a personal guarantee from the two principals of Infinity. The Company expects facility level operational performance to improve under Infinity’s stewardship and commitment to the surrounding community. As of March 31, 2019 and December 31, 2018 the Company had lent $250,000 and $106,334, respectively, to Infinity under this agreement.

6. DEBT AND DEBT-RELATED PARTIES   The following is a summary of the Company’s debt outstanding as of March 31, 2019 and December 31, 2018:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">December 31, 2018</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 62%; line-height: 107%">Senior Secured Promissory Notes</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 16%; text-align: right; line-height: 107%">1,485,000</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 16%; text-align: right; line-height: 107%">1,485,000</td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Senior Unsecured Promissory Notes</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">300,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">300,000</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Senior Secured Promissory Notes - Related Parties</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">875,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">875,000</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Fixed-Rate Mortgage Loans</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">20,902,663</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">21,049,981</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Variable-Rate Mortgage Loans</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">4,618,006</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">4,618,006</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Line of Credit</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">7,385,978</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">7,240,183</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Other Debt</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">1,536,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">1,536,000</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">37,102,647</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">37,104,170</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Premium, Unamortized Discount and Debt Issuance Costs</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">(483,590</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">(507,829</td> <td style="line-height: 107%">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">36,619,057</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">36,596,341</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">As presented in the Consolidated Balance Sheets:</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Debt, Net</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">35,744,057</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">35,721,341</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Debt - Related Parties, Net</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">875,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">875,000</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">36,619,057</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">36,596,341</td> <td style="line-height: 107%"> </td></tr> </table>   Corporate Senior and Senior Secured Promissory Notes   From November through December 2016, the Company undertook a private offering of its 10% Senior Secured Promissory Notes. As of December 31, 2016, $600,000 of the notes had been issued of which $450,000 were issued to the directors of the Company or entities or persons affiliated with these directors. The notes initially bore interest at a rate of 10% payable monthly with principal and unpaid interest due at maturity, originally January 13, 2018. The notes were issued with warrants to purchase 600,000 shares of common stock at an exercise price of $0.75 per share. The warrants have a cashless exercise provision.   The notes are secured by all assets of the Company not serving as collateral for other notes. As of December 31, 2017, $500,000 in notes had their maturity date extended to December 31, 2018, and all notes’ maturity dates were extended prior to their original maturity. The maturity date of the 600,000 warrants issued along with the notes was extended to December 31, 2018 as well. The transaction was accounted for as a debt extinguishment with a loss on modification of warrant in the amount of $62,696 recorded in the consolidated statement of operations for the year ended December 31, 2017.   In 2017, an additional $600,000 in notes were sold and issued, of which $425,000 were to related parties. At December 31, 2017, there were outstanding an aggregate of $1.2 million in senior secured notes. The maturity date of all the senior secured notes was extended to December 31, 2018 prior to their original maturity date, $225,000 of which occurred in 2018. During 2018, among the $225,000 senior secured notes that were extended to December 31, 2018, $125,000 were to related parties. For every $1.00 in principal amount of note, investors got one warrant exercisable for one year to purchase an additional share of common stock at an exercise price of $.75 per share. The warrants have a cashless exercise provision and were valued using the Black-Scholes pricing model. The maturity date of the 1.2 million warrants issued along with the notes was extended to December 31, 2018 as well, 225,000 warrants of which occurred in 2018.   In October 2017, the Company sold an aggregate of $300,000 in senior unsecured notes. The notes bear interest at the rate of 10% per annum and are due in 2020. For every $1.00 in principal amount of note, investors got one warrant exercisable for one year to purchase an additional share of common stock at an exercise price of $.75 per share. The warrants have a cashless exercise provision.   In October 2018, the Company, through a registered broker-dealer acting as Placement Agent, undertook a private offering to accredited investors of Units, each Unit consisting of an 11% Senior Secured Note, due in three years, (October 31, 2021) and Warrant for each $1.00 in principal amount of Note exercisable for three years to purchase a share of Common Stock at an exercise price of $0.50 per share. The Company and the Placement Agent completed the Offering in December 2018 having sold an aggregate of $1,160,000 in Notes and Warrants. The net proceeds to the Company were $1,092,400, after deducting Placement Agent fees of $67,600, and issued 111,000 warrants to the Placement Agent with $21,453 of the fair value of the warrants recorded as loan cost. The Offering also included the exchange of an aggregate of $1.075 million in outstanding senior secured 10% Notes and Warrants for Units in the Offering. No proceeds were realized from the exchange and no fees were paid to the Placement Agent for such exchanges. During 2018, among the $1.075 million senior secured notes that were extended to October 31, 2021 by virtue of the exchange, $875,000 were to related parties. As of March 31, 2019 the Company had not renewed or repaid $125,000 in 10% notes with a maturity date of December 31, 2018, and those notes were technically in default.   The value of the warrants issued to the note holders was calculated using the Black-Scholes pricing model using the following significant assumptions:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">December 31, 2018</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 77%; line-height: 107%">Volatility</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 20%; text-align: right; line-height: 107%">122% - 123 </td> <td style="width: 1%; line-height: 107%">%</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Risk-free Interest Rate</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2.76% - 2.94</td> <td style="line-height: 107%">%</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Exercise Price</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">0.50</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Fair Value of Common Stock</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">0.30 - $0.35</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Expected Life</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2.9 – 3.0 years</td> <td style="line-height: 107%"> </td></tr> </table>   During the year ended December 31, 2017, the Company issued 900,000 warrants in connection with its note offerings with a value on the issue date estimated to be $121,435, bifurcated from the value of the note. As of December 31, 2017, the unamortized balance of discount on notes was $77,105. During the year ended December 31, 2018, the Company issued 1,160,000 warrants with a value on the issue date estimated to be $207,025 bifurcated from the value of the note and exchanged 1,075,000 existing warrants for new ones in connection with its note offerings. As a result of the modification the Company recognized a loss on extinguishment of $248,346. As of March 31, 2019, the unamortized balance of discount on notes was $196,908. Amortization expense was $16,261 and $19,568 for the three months ended March 31, 2019 and 2018, respectively.   Mortgage Loans and Lines of Credit Secured by Real Estate   Mortgage loans and other debts such as line of credit here are collateralized by all assets of each nursing home property and an assignment of its rents. Collateral for certain mortgage loans includes the personal guarantee of Christopher Brogdon. Mortgage loans for the periods presented consisted of the following:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="text-align: center; line-height: 107%">Face</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Principal Outstanding at</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Stated Interest</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Maturity</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Property</td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Amount</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">December 31, 2018</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Rate</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Date</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 22%; line-height: 107%">Southern Hills Retirement Center Line of Credit (1)(2)</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 10%; text-align: right; line-height: 107%">7,229,052</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 12%; text-align: right; line-height: 107%">7,105,218</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 16%; text-align: right; line-height: 107%">7,119,743</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 14%; text-align: center; line-height: 107%">5.25% Fixed</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 14%; text-align: center; line-height: 107%">April 28, 2019</td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Middle Georgia Nursing Home (2,3)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">3,570,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">3,533,486</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">3,561,461</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">5.50% Fixed</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">October 26, 2021</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Goodwill Nursing Home (2)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">5,005,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">4,355,739</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">4,390,082</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">5.50% Fixed</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">March 19, 2020</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Warrenton Nursing Home (4)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,720,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,270,447</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,287,323</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">5.50% Fixed</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">January 20, 2020</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Edward Redeemer Health & Rehab</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,303,815</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,118,284</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,138,128</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">5.50% Fixed</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">January 16, 2020</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Glen Eagle Health & Rehab (5)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,761,250</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,743,557</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,761,250</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">5.50% Fixed</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">May 25, 2021</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Glen Eagle Health and Rehab Line of Credit (2)(5)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">400,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">280,760</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">120,440</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">6.50% Fixed</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">September 30, 2019</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Providence of Sparta Nursing Home (6)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">3,039,300</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,961,250</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,975,337</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">3.88% Fixed</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">November 1, 2047</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Meadowview Healthcare Center (7)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">3,000,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,919,900</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2,936,400</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">6.00% Fixed</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">October 30, 2022</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">GL Nursing Home (8)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">5,000,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">4,618,006</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">4,618,006</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Prime Plus 1.50%/ 5.75% Floor</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">August 3, 2037</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">32,906,647</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">32,908,170</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> </table>   (1) On October 31, 2017, the Company, through its wholly-owned subsidiaries Southern Tulsa, LLC and Southern Tulsa TLC, LLC, as Co-Borrowers, consummated a new Line of Credit with Southern Bank (formerly First Commercial Bank) pursuant to a Promissory Note in the principal amount of $7,229,052 (the “Line of Credit”). Under the Line of Credit, the Company refinanced the prior mortgage on its skilled nursing facility in Tulsa for $1,546,801,funded open market and tender offer purchases of its Industrial Revenue Bonds covering the ALF and ILF as well as provided working capital for improvements to the ALF and ILF. As of December 31, 2018, a total of $7,119,743 was drawn under the Line of Credit, and as of March 31, 2019, a total of $7,105,218 was drawn under the Line of Credit.   The interest rate on the Line of Credit is 5.25%. Monthly payments of interest began on November 30, 2017 and continue until the Promissory Note is paid in full on the Maturity Date. On May 3, 2018 the Maturity Date was extended from April 30, 2018 to October 30, 2018. The Maturity Date was further extended to February 28, 2019 and subsequently to April 28, 2019, with the intent to convert to an amortizing loan thereafter. The Credit Note is secured by a First Mortgage and Assignment of Rents on Real Property for Southern Hills Rehabilitation Center, a Junior Lien and Assignment of Rents on Real Property for it Southern Hills Independent Living Facility location and a Junior Lien on Real Property for its Southern Hills Assisted Living Facility location. With the retirement of the Tulsa Industrial Authority Bonds effective November 1, 2018, Southern Bank (formerly First Commercial Bank) moved into a senior position on the ALF and ILF properties.   (2) Mortgage loans are non-recourse to the Company except for (i) the senior loan held by ServisFirst Bank on Meadowview (Ohio), (ii) the loan held by Colony Bank on Middle Georgia and Glen Eagle, and (iii) the Southern Hills line of credit and Goodwill loan owed to Southern Bank (formerly First Commercial Bank).   (3) The loan at Middle Georgia was renewed on November 26, 2018 with the maturity extended to October 26, 2021.   (4) The loan was extended on January 19, 2019 to January 20, 2020 and the Company capitalized $8,885 in loan costs paid, amortized over the term of the extension. Amortization expense related to loan costs of this loan totaled $2,050 for the three months ended March 31, 2019. The Company has incurred $43,681 in unamortized loan costs to refinance this debt with another lender.   (5) Amortization expense related to loan costs of this loan totaled $219 for the three months ended March 31, 2019. Amortizing payments began in January 2019. In June 2018 the Company converted the original note to a fixed note which qualified as debt extinguishment, unamortized debt discount on the original note was expensed as a loss on extinguishment of $27,794. In April 2018, the Company capitalized $22,800 in fees and interest and added it to principal. The Company is subject to financial covenants and customary affirmative and negative covenants, including compliance with the covenants of all other notes and bonds. As of March 31, 2019, the Company was not in compliance with some unrelated notes and bonds, which is considered to be a technical Event of Default as defined in the note agreement, but the Company believes that it is in good standing with the Lender. In October 2018 the Lender extended the Company a line of credit with a limit of $200,365 to provide working capital to scale operations at the facility. As of December 31, 2018 the Company had drawn $120,440 on the line. The line of credit was expanded in February 2019 to $400,000 with a maturity of September 30, 2019. As of March 31, 2019, the Company had drawn $280,760 on the line.   (6) The senior debt and subordinated debt owed in relation to Providence of Sparta was refinanced into a single senior HUD note during 2017. Amortization expense related to loan costs totaled $1,246 for the three months ended March 31, 2019.   (7) Amortization expense related to loan costs of this loan totaled $2,326 for the three months ended March 31, 2019. The Company is subject to financial covenants and customary affirmative and negative covenants, including compliance with the covenants of all other notes and bonds. As of March 31, 2019, the Company was not in compliance with some unrelated notes and bonds, which is considered to be a technical Event of Default as defined in the note agreement, but the Company believes that it is in good standing with the Lender.   (8) Effective September 19, 2016, we executed a Modification to the mortgage note pursuant to which some accrued payments were deferred, and the lender agreed to permit interest only payments through March 2017. The mortgage loan collateralized by the GL Nursing Home is 80% guaranteed by the USDA and requires an annual renewal fee payable in the amount of 0.25% of the USDA guaranteed portion of the outstanding principal balance as of December 31 of each year. The Company is subject to financial covenants and customary affirmative and negative covenants. As of March 31, 2019, the Company was not in compliance with certain of these financial and non-financial covenants which is considered to be a technical Event of Default as defined in the note agreement. The Company is also delinquent in installment payments due under the mortgage. Remedies available to the lender in the event of a continuing Event of Default, at its option, include, but are necessarily limited to the following (1) lender may declare the principal and all accrued interest on the note due and payable; and (2) lender may exercise additional rights and remedies under the note agreement to include taking possession of the collateral or seeking satisfaction from the guarantors. The Company has been notified by the lender regarding the Events of Default. Guarantors under the mortgage loan include Christopher Brogdon. With our consent, Mr. Brogdon has assumed operations of the facility and is dealing with the lender. The Company is in negotiations with Mr. Brogdon to sell him the facility.   Other mortgage loans contain non-financial covenants, including reporting obligations, with which the Company has not complied in some instances or in an untimely manner. These mortgage loans are technically in default.   Bonds Payable - Tulsa County Industrial Authority   On March 1, 2014, Southern Tulsa, LLC (Southern Tulsa), a subsidiary of WPF that owns the Southern Hills Retirement Center, entered into a loan agreement with the Tulsa County Industrial Authority (Authority) in the State of Oklahoma pursuant to which the Authority lent to Southern Tulsa the proceeds from the sale of the Authority’s Series 2014 Bonds. The Series 2014 Bonds consisted of $5,075,000 of principal in Series 2014A First Mortgage Revenue Bonds and $625,000 of principal in Series 2014B Taxable First Mortgage Revenue Bonds. During the year ended December 31, 2017, $127,000 of Series 2014B Taxable First Mortgage Revenue Bond were retired with $60,000 in cash payments and 67,000 in non-cash payments; $452,000 of Series 2014A First Mortgage Revenue Bonds were retired with non-cash payments. Deferred loan costs incurred of $478,950 and an original issue discount of $78,140 related to the loan are amortized to interest expense over the life of the loan. Amortization expense related to deferred loan costs and the original issue discount totaled $4,704 and $761, respectively, for the three months ended March 31, 2018. The loan agreement includes certain financial covenants required to be maintained by the Company, with which we were not in compliance as of March 31, 2019. There is $5,061,000 in voluntary non-cash principal reduction payments during the year ended December 31, 2018. As of March 31, 2019 and December 31, 2018, restricted cash of $1,179 and $1,179, respectively is related to these bonds.   Other Debt   Other debt due at March 31, 2019 and December 31, 2018 includes unsecured notes payable issued to entities controlled by the Company used to facilitate the acquisition of the nursing home properties.   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="text-align: center; line-height: 107%">Face</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Principal Outstanding at</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Stated Interest</td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Maturity</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Property</td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Amount</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">December 31, 2018</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Rate</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Date</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 22%; line-height: 107%">Goodwill Nursing Home</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 10%; text-align: right; line-height: 107%">2,180,000</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="width: 12%; border-bottom: black 2.25pt double; text-align: right; line-height: 107%">1,536,000</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="width: 16%; border-bottom: black 2.25pt double; text-align: right; line-height: 107%">1,536,000</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 14%; text-align: center; line-height: 107%">13% (1) Fixed</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 14%; text-align: center; line-height: 107%">December 31, 2019</td> <td style="width: 1%; line-height: 107%"> </td></tr> </table>   (1) The subordinated note on Goodwill matured on July 1, 2015. Investors in the Goodwill note were entitled to an additional 5% equity in Goodwill Hunting, LLC every six months if the note is not paid when due. Effective December 31, 2015, the investors holding the subordinated debt executed an Agreement Among Lenders pursuant to which they (i) agreed to waive any and all equity ratchets and (ii) agreed to extend the maturity date of the subordinated debt to June 30, 2017. In exchange, Goodwill Hunting agreed to pay the investors an additional one-time premium equal to 5% of the principal amount of the individual note at such time as the note is repaid. Effective May 3, 2017, we entered into an Allonge and Modification Agreement with the Goodwill investors pursuant to which they agreed to (i) waive all accrued interest through December 31, 2017, (ii) reduce interest rate to 13% beginning January 1, 2018 and (iii) extend the maturity date of the notes to December 31, 2019. In exchange, the Company agreed that upon repayment of the notes, the investors would be entitled to a one-time premium payment in the amount of 15% of the principal balance of the notes.   For the three months ended March 31, 2019 and 2018, the Company received proceeds from the issuance of debt of $159,875 and $52,862, respectively. Cash payments on debt totaled $147,318 and $132,448 for the three months ended March 31, 2019 and 2018, respectively. Amortization expense for deferred loan costs totaled $33,124 and $45,047 for the three months ended March 31, 2019 and 2018, respectively.   Future maturities and principal reduction payments of all notes and bonds payable listed above for the next five years and thereafter are as follows:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Years</td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 77%; text-align: center; line-height: 107%">2019</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 20%; text-align: right; line-height: 107%">19,659,755</td> <td style="width: 1%; line-height: 107%">(1)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: center; line-height: 107%">2020</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">9,013,714</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: center; line-height: 107%">2021</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">5,626,986</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: center; line-height: 107%">2022</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">64,013</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: center; line-height: 107%">2023</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">66,541</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: center; line-height: 107%">2024 and after</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">2,671,638</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">37,102,647</td> <td style="line-height: 107%"> </td></tr> </table>   (1) Any note or bond that is not in compliance with all financial and non-financial covenants is considered to have an immediate maturity, including those that require compliance with covenants on any and all other notes. The notes secured by the facilities at Meadowview and Abbeville have such covenants which were in technical non-compliance at March 31, 2019, but the Company believes that its relationships with these lenders is good.

7. STOCKHOLDERS’ EQUITY   Preferred Stock   The Company has authorized 10,000,000 shares of preferred stock. These shares may be issued in series with such rights and preferences as may be determined by the Board of Directors.   Series A Convertible Redeemable Preferred Stock   The Company’s Board of Directors has authorized 2,000,000 shares of $2.00 stated value, Series A Preferred Stock. The preferred stock has a senior liquidation preference value of $2.00 per share, has no voting or redemption rights and does not accrue dividends.   As of March 31, 2019 and December 31, 2018, the Company has 200,500 shares of Series A Preferred stock outstanding.   Series D Convertible Preferred Stock   The Company has established a class of preferred stock designated “Series D Convertible Preferred Stock” (Series D preferred stock) and authorized an aggregate of 1,000,000 non-voting shares with a stated value of $1.00 per share. Holders of the Series D preferred stock are entitled to receive dividends at the annual rate of eight percent (8%) based on the stated value per share computed on the basis of a 360 day year and twelve 30 day months. Dividends are cumulative, shall be declared quarterly, and are calculated from the date of issue and payable on the fifteenth day of April, July, October and January. The dividends may be paid, at the option of the holder either in cash or by the issuance of shares of the Company’s common stock valued at the market price on the dividend record date. Shares of the Series D preferred stock are redeemable at the Company’s option. At the option of the holder, shares of the Series D preferred stock plus any declared and unpaid dividends are convertible to shares of the Company’s common stock at a conversion rate of $1.00 per share.   As of March 31, 2019 and December 31, 2018, the Company had 375,000 shares of Series D preferred stock outstanding.   During the three months ended March 31, 2019 and 2018, the Company paid $7,500 and $7,500, respectively, for Series D preferred stock dividends. Dividends of $7,500 and $7,500 were declared during the three months ended March 31, 2019 and 2018, respectively, with dividends of $7,500 accrued and payable as of March 31, 2019 and 2018. All quarterly dividends previously declared have been paid.   Restricted Stock Awards   The following table summarizes the restricted stock unit activity during the three months ended March 31, 2019 and 2018.   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2018</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Outstanding Non-Vested Restricted Stock Units, Beginning</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="width: 62%; line-height: 107%">Granted</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 16%; text-align: right; line-height: 107%">272,727</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 16%; text-align: right; line-height: 107%">562,500</td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Vested</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">(68,182</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">(140,625</td> <td style="line-height: 107%">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Outstanding Non-Vested Restricted Stock Units, Ending</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">204,545</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">421,875</td> <td style="line-height: 107%"> </td></tr> </table>   In connection with these director and executive restricted stock grants, the Company recognized stock-based compensation of $22,500 and $45,000 for the three months ended March 31, 2019 and 2018, respectively.   Common Stock Warrants   As of March 31, 2019 and December 31, 2018, the Company had 2,714,918 and 3,142,586, respectively, of outstanding warrants to purchase common stock at a weighted average exercise price of $0.57 and $0.60, respectively. During the three month period ended March 31, 2019 and 2018, an aggregate of 427,668 and 71,250 warrants with a weighted average exercise price of $0.75 and $0.60, respectively, expired. The aggregate intrinsic value of the common stock warrants outstanding at March 31, 2019 was $0.   Common Stock Options   As of March 31, 2019 and December 31, 2018, the Company had 600,000 and 600,000, respectively, of outstanding options to purchase common stock at a weighted average exercise price of $0.36. During the three month period ended March 31, 2019 and 2018, no options expired. The aggregate intrinsic value of the common stock options outstanding at March 31, 2019 was $0.

8. RELATED PARTIES   Clifford Neuman provides office space for the Company’s Controller at no charge. As of March 31, 2019 and December 31, 2018, the Company owed Mr. Neuman for legal services rendered $93,406 and $118,230, respectively.   Creative Cyberweb developed and maintains the Company’s website, and is affiliated with CFO Zvi Rhine’s family. The ongoing upkeep is $450 per month.   In January 2018, the Directors modified the Directors’ Compensation Plan to provide the annual grants be subject to ratable vesting over 12 months. In March 2019, The Board approved an annual grant to three of its Directors without other compensation plans, restricted stock awards of 90,909 shares each, subject to vesting. In connection with these director restricted stock grants, the Company recognized stock-based compensation of $22,500 and $45,000 for the three months ended March 31, 2019 and 2018, respectively.   In May 2018, the Company approved a compensation agreement for CFO Zvi Rhine that included (i) base salary of $165,000 per year (which accrues beginning January 1, 2018 but payable only after the Company raises capital of at least $600,000), (ii) 150,000 shares of restricted stock vesting one-half each on January 1, 2019 and January 1, 2020, and (iii) options to purchase 600,000 of the Company’s common stock at an exercise price of $.36 per share, each expiring on March 31, 2023, and vesting one quarter each on April 1, 2018, April 1, 2019, October 1, 2019, and April 1, 2020. For the three months ended March 31, 2019 the Company has accrued $58,750 in salaries, and recognized $22,500 in stock-based compensation for Directors and $28,029 for Mr. Rhine. Effective April 1, 2019, the Company and Mr. Rhine entered into an Amendment No. 1 to the Employment Agreement. See Subsequent Events for details.

9. FACILITY LEASES   The following table summarizes our leasing arrangements related to the Company’s healthcare facilities at March 31, 2019:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Facility</td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Monthly Lease Income (1)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Lease Expiration</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Renewal Option, if any</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 36%; line-height: 107%">Middle Georgia</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 16%; text-align: right; line-height: 107%">60,000</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 16%; text-align: center; line-height: 107%">October 31, 2022</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 26%; text-align: center; line-height: 107%">None</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Warrenton</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">55,724</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">June 30, 2026</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Term may be extended for one additional ten-year term.</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Goodwill (2)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">40,125</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">February 1, 2027</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Term may be extended for one additional five-year term.</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Edwards Redeemer</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">48,728</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">October 31, 2022</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Term may be extended for one additional five-year term.</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Providence</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">42,519</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">June 30, 2026</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Term may be extended for one additional ten-year term.</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Meadowview (3)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">October 31, 2023</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Term may be extended for one additional five-year term.</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">GL Nursing (4)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">None</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Glen Eagle (5)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">None</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Southern Hills SNF (6)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">37,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">May 31, 2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">Term may be extended for one additional five-year term.</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Southern Hills ALF (7)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">None</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Southern Hills ILF (8)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: center; line-height: 107%">None</td></tr> </table>   (1) Monthly lease income reflects rent income on a straight-line basis over, where applicable, the term of each lease.   (2) In January 2016, the Goodwill facility was closed by Georgia regulators and all residents were removed. In a transaction related to the sale of the Greene Point facility, an affiliate of the buyer of Greene Point executed a ten year operating lease covering Goodwill. After investing approximately $2.0 million in capital improvements in the property, the lease operator obtained all regulatory approvals and began admitting patients in December 2016. The lease became effective on February 1, 2017, and the facility began generating rental revenue thereafter.   (3) The lease was generating $33,000 in monthly gross rent; however, the operator experienced adverse results in late 2017 and throughout 2018. In April 2018 the Company recognized a bad debt expense of $56,000 related to rent receivables previously booked in 2018 at the Meadowview facility. Effective December 1, 2018, the Company completed the operations transfer to an affiliate of Infinity Health Interests, LLC (“Infinity”). The lease is structured with a lower base rent component than the prior operator but also includes occupancy-based escalators that will better align facility operations with future rental payments.   (4) Effective January 1, 2016, the GL Nursing facility was leased to another operator for a period of ten years at a monthly base rent of $30,000 which was subject to increases based on census levels. Under the terms of the lease, the Company agreed to fund certain capital expenditures, which it was unable to fulfill. In July 2016, the new tenant served notice that it was terminating the lease effective August 31, 2016. The Company entered into a Lease Termination Agreement under which it paid the tenant $145,000 and is obligated to make future payments. Effective August 30, 2016, the Company entered into a new lease agreement with another nursing home operator. The lease term was to commence at the end of a straddle period. During the straddle period, the Company made working capital advances to enable the operator to cover cash flow deficits resulting from initial operations of the facility. Prior to the end of the straddle period, the lease operator informed the Company that it would vacate the facility. An entity affiliated with Mr. Brogdon, who is a guarantor of the mortgage, assumed operations of the facility in March 2018 under an OTA. We do not expect the facility to generate any future revenue for the Company.   (5) The Company entered into a management agreement with Cadence Healthcare Solutions to operate Glen Eagle after expending approximately $1.0 million in capital improvements. The facility passed its licensure survey and began admitting patients in June 2018. Effective October 12, 2018, the facility gained its certification and started collecting revenues from Medicare and Medicaid in April 2019.   (6) Lease agreement dated May 21, 2014 with lease payments commencing February 1, 2015. On May 10, 2016, the Company obtained a Court Order appointing a Receiver to control and operate the Southern Hills SNF. The former lease operator represented that it was unable to meet the financial commitments of the facility, including the payment of rent, payroll and other operating requirements. In October 2017, the Receiver engaged a new manager for the facility at the request of the Company.   (7) The Company plans to operate the Southern Hills ALF through a third-party manager once construction is complete and a state license is secured.    (8) The Company plans to operate the Southern Hills ILF through a third-party manager once renovations are complete. The first residents are expected in July 2019.   Lessees are responsible for payment of insurance, taxes and other charges while under the lease. Should the lessees not pay all such charges as required under the leases, or if there is no tenant, the Company may become liable for such operating expenses. We have been required to cover those expenses at Glen Eagle as well as the Southern Hills ALF and ILF.   Future cash payments for rent to be received during the initial terms of the leases for the next five years and thereafter are as follows (excludes Abbeville, Southern Tulsa ALF and Southern Tulsa ILF due to property being non-operating, and GL Nursing):   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Years</td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 79%; text-align: center; line-height: 107%">2018</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 18%; text-align: right; line-height: 107%">2,345,240</td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: center; line-height: 107%">2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">3,126,946</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: center; line-height: 107%">2020</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">3,183,242</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: center; line-height: 107%">2021</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">3,015,544</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="text-align: center; line-height: 107%">2022</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">1,922,794</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="text-align: center; line-height: 107%">2023 and Thereafter</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">5,120,111</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">18,713,877</td> <td style="line-height: 107%"> </td></tr> </table>

10. FAIR VALUE MEASUREMENTS   Financial assets and liabilities recorded at fair value in our consolidated balance sheets are categorized based upon a fair value hierarchy established by GAAP, which prioritizes the inputs used to measure fair value into the following levels:   Level 1— Quoted market prices in active markets for identical assets or liabilities at the measurement date.   Level 2— Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable and can be corroborated by observable market data.   Level 3— Inputs reflecting management’s best estimates and assumptions of what market participants would use in pricing assets or liabilities at the measurement date. The inputs are unobservable in the market and significant to the valuation of the instruments.   A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.   Our consolidated balance sheets include the following financial instruments: cash and cash equivalents, advances to related parties, notes receivable, restricted cash, accounts payable, debt and lease security deposit. We consider the carrying values of our short-term financial instruments to approximate fair value because they generally expose the Company to limited credit risk, because of the short period of time between origination of the financial assets and liabilities and their expected settlement, or because of their proximity to acquisition date fair values. The carrying value of debt approximates fair value based on borrowing rates currently available for debt of similar terms and maturities.   Upon acquisition of real estate properties, the Company determines the total purchase price of each property and allocates this price base on the fair value of the tangible assets and intangible assets, if any, acquired and any liabilities assumed based on Level 3 inputs. These Level 3 inputs can include comparable sales values, discount rates, and capitalization rate assumptions from a third party appraisal or other market sources.   Assets and liabilities measured at fair value on a recurring basis as of March 31, 2019 and December 31, 2018 are summarized below:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="10" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Fair Value Measurement</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Total</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Level 1</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Level 2</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Level 3</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 48%; line-height: 107%">Warrant Liability</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 10%; text-align: right; line-height: 107%">2,682</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 10%; text-align: right; line-height: 107%">-</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 10%; text-align: right; line-height: 107%">-</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 10%; text-align: right; line-height: 107%">2,682</td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Investment in Debt Securities</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">12,134</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">12,134</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Fair Value at March 31, 2019</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">14,816</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">12,134</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">2,682</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Warrant Liability</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">2,785</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">2,785</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Investment in Debt Securities</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">162,106</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">162,106</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Fair Value at December 31, 2018</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">164,891</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">162,106</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">2,785</td> <td style="line-height: 107%"> </td></tr> </table>   Because these warrants have full reset adjustments tied to future issuance of equity securities by the Company, it is subject to derivative liability treatment under ASC 815-40-15.   The warrant liability is marked-to-market each reporting period with the change in fair value recorded as a gain or loss within Other (Income) Expense on the Company’s Consolidated Statement of Operations until the warrants are exercised, expire, or other facts and circumstances lead the warrant liability to be reclassified as an equity instrument. The fair value of the warrant liability is determined each reporting period by utilizing the Black-Scholes option pricing model.   The investments in debt securities are recorded at amortized cost since they are considered held-to-maturity.   The table presented below is a summary of changes in the fair value of the Company’s Level 3 valuation for the three months ended March 31, 2019 and 2018:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">2018</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 72%; line-height: 107%">Beginning Balance January 1</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 11%; text-align: right; line-height: 107%">2,785</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 11%; text-align: right; line-height: 107%">95,371</td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Change in Fair Value of Warrant Liability</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">(103</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">(40,423</td> <td style="line-height: 107%">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Ending Balance, March 31</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">2,682</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">54,948</td> <td style="line-height: 107%"> </td></tr> </table>   The significant assumptions used in the Black-Scholes option pricing model as of March 31, 2019 and December 31, 2018 include the following:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">December 31, 2018</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 54%; line-height: 107%">Volatility</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 20%; text-align: right; line-height: 107%">147.43</td> <td style="width: 1%; line-height: 107%">%</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 20%; text-align: right; line-height: 107%">63.58% - 91.93</td> <td style="width: 1%; line-height: 107%">%</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Risk-free Interest Rate</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2.44</td> <td style="line-height: 107%">%</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">2.36% - 2.59</td> <td style="line-height: 107%">%</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Exercise Price</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">1.37</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">0.75 - 1.37</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Fair Value of Common Stock</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">0.33</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%">$</td> <td style="text-align: right; line-height: 107%">0.33</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Expected Life</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">0.49 years</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">0.45 – 0.99 years</td> <td style="line-height: 107%"> </td></tr> </table>

11. SEGMENT REPORTING   The Company had two primary reporting segments during the three months ended March 31, 2019, which include real estate services and healthcare services. The Company reports segment information based on the “management approach” defined in ASC 280, Segment Reporting. The management approach designates the internal reporting used by management for making decisions and assessing performance as the source of our reportable segments.   Total assets for the healthcare services and real estate services segments were $561,376 and $37,927,933, respectively, as of March 31, 2019 and $145,260 and $38,150,627, respectively, as of December 31, 2018.   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="22" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Statements of Operations Items for the Three Months Ended</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="10" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="10" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2018</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Real Estate Services</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Healthcare Services</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Consolidated</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Real Estate Services</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Healthcare Services</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">Consolidated</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 46%; line-height: 107%">Rental Revenue</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 6%; text-align: right; line-height: 107%">895,288</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 6%; text-align: right; line-height: 107%">-</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 6%; text-align: right; line-height: 107%">895,288</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 6%; text-align: right; line-height: 107%">812,065</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 6%; text-align: right; line-height: 107%">-</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 6%; text-align: right; line-height: 107%">812,065</td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Healthcare Revenue</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">379,791</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">379,791</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Total Revenue</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">895,288</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">379,791</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">1,275,079</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">812,065</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">812,065</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Expenses</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">General and Administrative</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">112,215</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">81,264</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">193,479</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">104,926</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">40,229</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">145,155</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Property Taxes, Insurance and Other Operating</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">62,655</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">286,533</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">349,188</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">22,203</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">58,613</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">80,816</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Depreciation</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">319,456</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">3,469</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">322,925</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">305,410</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">305,410</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Total Expenses</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">494,326</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">371,266</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">865,592</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">432,539</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">98,842</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">531,381</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Income (Loss) from Operations</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">400,962</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">8,525</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">409,487</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">379,526</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">(98,842</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">280,684</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Other (Income) Expense</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Gain on Warrant Liability</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(103</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(103</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(40,423</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(40,423</td> <td style="line-height: 107%">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Gain on Extinguishment of Debt</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(94,925</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(94,925</td> <td style="line-height: 107%">)</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">(Gain) Loss on Settlement of Other Liabilities</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">29,900</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">29,900</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Gain on Sale of Investments</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(1,069</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(1,069</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Gain from Insurance Claim</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(270,264</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(270,264</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Interest Income</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(5,467</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(5,467</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Interest Expense</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">526,235</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">526,235</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">598,366</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">598,366</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Total Other (Income) Expense</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">249,332</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">249,332</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">492,918</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">492,918</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Net Income (Loss)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">151,630</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">8,525</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">160,155</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(113,392</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(98,842</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(212,234</td> <td style="line-height: 107%">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Net Loss Attributable to Noncontrolling Interests</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">4,141</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">4,141</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">7,901</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">-</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">7,901</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Net Income (Loss) Attributable to Global Healthcare REIT, Inc.</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">155,771</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">8,525</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">164,296</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">(105,491</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">(98,842</td> <td style="line-height: 107%">)</td> <td style="padding-bottom: 2.5pt"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">(204,333</td> <td style="line-height: 107%">)</td></tr> </table>

12. LEGAL PROCEEDINGS   The Company and/or its affiliated subsidiaries are involved in the following litigation:   Bailey v. GL Nursing, LLC, et. al in the Circuit Court of Lonoke County, Arkansas, 23rd Circuit, 43CV-19-151.   The Company’s wholly owned subsidiary, was named as a co-defendant in the action arising out of a claimed personal injury suffered by the plaintiff while a resident of the skilled nursing home owned, but not operated, by GL Nursing. As of this date, we have engaged counsel but no further information is known regarding the merits of the claim. After initial inquiry, it does not appear that the lease operator of the facility had in effect general liability insurance covering the GL Nursing, as landlord, as required by the operating lease.   As we simply were the owners of the property and not the operators, we believe that primary responsibility, if any, falls with the operator at the time. Under the terms of the lease, the operator has a duty to indemnify the Company, a claim which we intend to assert.   While it is too early to assess the Company’s exposure, we believe at this time that the likelihood of an adverse outcome is remote.   Southern Tulsa, LLC v. Healthcare Management of Oklahoma, LLC, District Court of Tulsa County, State of Oklahoma, Case No. CJ – 2016- 01781.   This matter was brought by us to have the appointment of a Receiver for the Southern Tulsa SNF and to recover damages from our former operator at that facility. The Court has ordered the appointment of a Receiver effective May 10, 2016. Other claims and matters are pending.   Thomas v. Edwards Redeemer Property Holdings, LLC, et.al., District Court for Oklahoma County, Oklahoma, Case No. CJ 2016-2160.   This action arises from a personal injury claim brought by heirs of a former resident of our Edwards Redeemer facility. We are entitled to indemnification from the lease operator and should be covered under the lease operator’s general liability policy. As we are not the operators of the facility and believe we have indemnity coverage, we believe we have no exposure. The lease operator’s insurance carrier is providing a defense and indemnity; and as a result we believe the likelihood of a material adverse result is remote.

13. SUBSEQUENT EVENTS   On April 12, 2019, the Company entered into a definitive Asset Purchase Agreement to acquire the Higher Call Nursing Center in Quapaw, Oklahoma. The transaction is subject to numerous conditions such as completing our due diligence, financing, completion of the operations transfer agreement, and is not closed as of the date of this report.   On April 15, 2019, the Company executed an Amendment No. 1 to Employment Agreement (the “Amendment”), with an effective date of April 1, 2019, with Zvi Rhine. Pursuant to the Amendment, the Company granted Mr. Rhine a bonus for 2018 services in the amount of $90,000 payable in shares of restricted common stock. The shares were valued at $0.33 per share (the closing price of the Company’s stock on April 2, 2019), resulting in 272,727 shares of Common Stock. The Amendment also defines a Bonus Plan for Mr. Rhine for future periods which provides for additional incentive compensation if certain performance milestones are achieved.

Organization and Description of the Business   Global Healthcare REIT, Inc. (the Company or Global) was organized with the intent of operating as a real estate investment trust (REIT) for the purpose of investing in real estate and other assets related to the healthcare industry. Prior to the Company changing its name to Global Healthcare REIT, Inc. on September 30, 2013, the Company was known as Global Casinos, Inc. Global Casinos, Inc. operated two gaming casinos which were split-off and sold on September 30, 2013. Simultaneous with the split-off and sale of the gaming operations, the Company acquired West Paces Ferry Healthcare REIT, Inc. (WPF) in a transaction accounted for as a reverse acquisition whereby WPF was deemed to be the accounting acquirer.   The Company intends to make a REIT election under sections 856 through 859 of the Internal Revenue Code of 1986, as amended. Such election will be made by the Board of Directors at such time as the Board determines that we qualify as a REIT under applicable provisions of the Internal Revenue Code.   The Company acquires, develops, leases, manages and disposes of healthcare real estate, and provides financing to healthcare providers. As of March 31, 2019, the Company owned eleven healthcare properties which are leased or managed by third-party operators under triple-net operating terms.

Basis of Presentation   The accompanying unaudited interim consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP) for interim financial information and in conjunction with the rules and regulations of the Securities Exchange Commission. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments considered necessary to make the consolidated financial statements not misleading have been included. Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the entire year. The unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 filed with the Securities and Exchange Commission.

Recently Adopted Accounting Pronouncements   Effective January 1, 2019, the Company adopted ASU No. 2018-07, Compensation – Stock Based Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-7”), which aligns accounting for share-based payments issued to nonemployees to that of employees under the existing guidance of Topic 718, with certain exceptions. This update supersedes previous guidance for equity-based payments to nonemployees under Subtopic 505-50, Equity – Equity-Based Payments to Non-Employees. The adoption of ASU 2018-07 did not have a material impact on the Company’s consolidated financial statements.   In February 2016, the Financial Accounting Standards Board issued ASU No. 2016-02, “Leases: Topic 842 (ASU 2016-02)”, to supersede nearly all existing lease guidance under GAAP. The guidance would require lessees to recognize most leases on their balance sheets as lease liabilities with corresponding right-of-use assets. ASU 2016-02 is effective for the Company as of January 1, 2019 and adoption requires using a modified retrospective approach with the option to elect certain practical expedients. The Company has determined that it does not have any leases that fall under the guidance of ASU 2016-02 and it had no impact on its consolidated financial statements.

Recently Issued Accounting Pronouncements   The Financial Accounting Standards Board and other entities issued new or modifications to, or interpretations of, existing accounting guidance during 2019. Management has carefully considered the new pronouncements that altered generally accepted accounting principles and does not believe that any other new or modified principles will have a material impact on the Company’s reported financial position or operations in the near term.

The gross carrying amount and accumulated depreciation of the Company’s property and equipment as of March 31, 2019 and December 31, 2018 are as follows:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">December 31, 2018</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 54%; line-height: 107%">Land</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 20%; text-align: right; line-height: 107%">1,597,500</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 20%; text-align: right; line-height: 107%">1,597,500</td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Land Improvements</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">200,000</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">200,000</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Buildings and Improvements</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">36,126,867</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">36,076,632</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Furniture, Fixtures and Equipment</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">1,475,923</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">1,469,976</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Construction in Progress</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">4,822,259</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">3,916,187</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">44,222,549</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">43,260,295</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Less Accumulated Depreciation</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(6,138,075</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%">(5,815,150</td> <td style="line-height: 107%">)</td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">Less Impairment</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">(1,560,000</td> <td style="line-height: 107%">)</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; line-height: 107%"> </td> <td style="border-bottom: black 1.5pt solid; text-align: right; line-height: 107%">(1,560,000</td> <td style="line-height: 107%">)</td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="text-align: right; line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">36,524,474</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">35,885,145</td> <td style="line-height: 107%"> </td></tr> </table>   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="6" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">For the Three Months Ended March 31,</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="text-align: center; line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">2018</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="line-height: 107%"> </td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="width: 54%; line-height: 107%">Depreciation Expense</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 20%; text-align: right; line-height: 107%">322,925</td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%">$</td> <td style="width: 20%; text-align: right; line-height: 107%">305,410</td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="line-height: 107%">Cash Paid for Capital Expenditures</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">962,254</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">143,445</td> <td style="line-height: 107%"> </td></tr> </table>

At March 31, 2019 and December 31, 2018, the Company held investments in marketable securities that were classified as held-to-maturity and carried at amortized costs. Held-to-maturity securities consisted of the following:   <table cellspacing="0" cellpadding="0" style="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse"> <tr style="vertical-align: bottom"> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">March 31, 2019</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td colspan="2" style="border-bottom: black 1.5pt solid; text-align: center; line-height: 107%">December 31, 2018</td> <td style="line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: white"> <td style="width: 54%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 20%; text-align: right; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td> <td style="width: 20%; text-align: right; line-height: 107%"> </td> <td style="width: 1%; line-height: 107%"> </td></tr> <tr style="vertical-align: bottom; background-color: #CCEEFF"> <td style="line-height: 107%">States and Municipalities</td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">12,134</td> <td style="line-height: 107%"> </td> <td style="line-height: 107%"> </td> <td style="border-bottom: black 2.25pt double; line-height: 107%">$</td> <td style="border-bottom: black 2.25pt double; text-align: right; line-height: 107%">162,106</td> <td style="line-height: 107%"> </td></tr> </table>

5467

-5467

The subordinated note on Goodwill matured on July 1, 2015. Investors in the Goodwill note were entitled to an additional 5% equity in Goodwill Hunting, LLC every six months if the note is not paid when due. Effective December 31, 2015, the investors holding the subordinated debt executed an Agreement Among Lenders pursuant to which they (i) agreed to waive any and all equity ratchets and (ii) agreed to extend the maturity date of the subordinated debt to June 30, 2017. In exchange, Goodwill Hunting agreed to pay the investors an additional one-time premium equal to 5% of the principal amount of the individual note at such time as the note is repaid. Effective May 3, 2017, we entered into an Allonge and Modification Agreement with the Goodwill investors pursuant to which they agreed to (i) waive all accrued interest through December 31, 2017, (ii) reduce interest rate to 13% beginning January 1, 2018 and (iii) extend the maturity date of the notes to December 31, 2019. In exchange, the Company agreed that upon repayment of the notes, the investors would be entitled to a one-time premium payment in the amount of 15% of the principal balance of the notes. The loan at Middle Georgia was renewed on November 26, 2018 with the maturity extended to October 26, 2021. The lease was generating $33,000 in monthly gross rent; however, the operator experienced adverse results in late 2017 and throughout 2018. In April 2018 the Company recognized a bad debt expense of $56,000 related to rent receivables previously booked in 2018 at the Meadowview facility. Effective December 1, 2018, the Company completed the operations transfer to an affiliate of Infinity Health Interests, LLC ("Infinity"). The lease is structured with a lower base rent component than the prior operator but also includes occupancy-based escalators that will better align facility operations with future rental payments. The Company entered into a management agreement with Cadence Healthcare Solutions to operate Glen Eagle after expending approximately $1.0 million in capital improvements. The facility passed its licensure survey and began admitting patients in June 2018. Effective October 12, 2018, the facility gained its certification and started collecting revenues from Medicare and Medicaid in April 2019. The Company plans to operate the Southern Hills ALF through a third-party manager once construction is complete and a state license is secured. The Company plans to operate the Southern Hills ILF through a third-party manager once renovations are complete. The first residents are expected in July 2019. Any note or bond that is not in compliance with all financial and non-financial covenants is considered to have an immediate maturity, including those that require compliance with covenants on any and all other notes. The notes secured by the facilities at Meadowview and Abbeville have such covenants which were in technical non-compliance at March 31, 2019, but the Company believes that its relationships with these lenders is good. On October 31, 2017, the Company, through its wholly-owned subsidiaries Southern Tulsa, LLC and Southern Tulsa TLC, LLC, as Co-Borrowers, consummated a new Line of Credit with Southern Bank (formerly First Commercial Bank) pursuant to a Promissory Note in the principal amount of $7,229,052 (the "Line of Credit"). Under the Line of Credit, the Company refinanced the prior mortgage on its skilled nursing facility in Tulsa for $1,546,801,funded open market and tender offer purchases of its Industrial Revenue Bonds covering the ALF and ILF as well as provided working capital for improvements to the ALF and ILF. As of December 31, 2018, a total of $7,119,743 was drawn under the Line of Credit, and as of March 31, 2019, a total of $7,105,218 was drawn under the Line of Credit. The interest rate on the Line of Credit is 5.25%. Monthly payments of interest began on November 30, 2017 and continue until the Promissory Note is paid in full on the Maturity Date. On May 3, 2018 the Maturity Date was extended from April 30, 2018 to October 30, 2018. The Maturity Date was further extended to February 28, 2019 and subsequently to April 28, 2019, with the intent to convert to an amortizing loan thereafter. The Credit Note is secured by a First Mortgage and Assignment of Rents on Real Property for Southern Hills Rehabilitation Center, a Junior Lien and Assignment of Rents on Real Property for it Southern Hills Independent Living Facility location and a Junior Lien on Real Property for its Southern Hills Assisted Living Facility location. With the retirement of the Tulsa Industrial Authority Bonds effective November 1, 2018, Southern Bank (formerly First Commercial Bank) moved into a senior position on the ALF and ILF properties. Mortgage loans are non-recourse to the Company except for (i) the senior loan held by ServisFirst Bank on Meadowview (Ohio), (ii) the loan held by Colony Bank on Middle Georgia and Glen Eagle, and (iii) the Southern Hills line of credit and Goodwill loan owed to Southern Bank (formerly First Commercial Bank). The loan was extended on January 19, 2019 to January 20, 2020 and the Company capitalized $8,885 in loan costs paid, amortized over the term of the extension. Amortization expense related to loan costs of this loan totaled $2,050 for the three months ended March 31, 2019. The Company has incurred $43,681 in unamortized loan costs to refinance this debt with another lender. Amortization expense related to loan costs of this loan totaled $219 for the three months ended March 31, 2019. Amortizing payments began in January 2019. In June 2018 the Company converted the original note to a fixed note which qualified as debt extinguishment, unamortized debt discount on the original note was expensed as a loss on extinguishment of $27,794. In April 2018, the Company capitalized $22,800 in fees and interest and added it to principal. The Company is subject to financial covenants and customary affirmative and negative covenants, including compliance with the covenants of all other notes and bonds. As of March 31, 2019, the Company was not in compliance with some unrelated notes and bonds, which is considered to be a technical Event of Default as defined in the note agreement, but the Company believes that it is in good standing with the Lender. In October 2018 the Lender extended the Company a line of credit with a limit of $200,365 to provide working capital to scale operations at the facility. As of December 31, 2018 the Company had drawn $120,440 on the line. The line of credit was expanded in February 2019 to $400,000 with a maturity of September 30, 2019. As of March 31, 2019, the Company had drawn $280,760 on the line. The senior debt and subordinated debt owed in relation to Providence of Sparta was refinanced into a single senior HUD note during 2017. Amortization expense related to loan costs totaled $1,246 for the three months ended March 31, 2019. Amortization expense related to loan costs of this loan totaled $2,326 for the three months ended March 31, 2019. The Company is subject to financial covenants and customary affirmative and negative covenants, including compliance with the covenants of all other notes and bonds. As of March 31, 2019, the Company was not in compliance with some unrelated notes and bonds, which is considered to be a technical Event of Default as defined in the note agreement, but the Company believes that it is in good standing with the Lender. Effective September 19, 2016, we executed a Modification to the mortgage note pursuant to which some accrued payments were deferred, and the lender agreed to permit interest only payments through March 2017. The mortgage loan collateralized by the GL Nursing Home is 80% guaranteed by the USDA and requires an annual renewal fee payable in the amount of 0.25% of the USDA guaranteed portion of the outstanding principal balance as of December 31 of each year. The Company is subject to financial covenants and customary affirmative and negative covenants. As of March 31, 2019, the Company was not in compliance with certain of these financial and non-financial covenants which is considered to be a technical Event of Default as defined in the note agreement. The Company is also delinquent in installment payments due under the mortgage. Remedies available to the lender in the event of a continuing Event of Default, at its option, include, but are necessarily limited to the following (1) lender may declare the principal and all accrued interest on the note due and payable; and (2) lender may exercise additional rights and remedies under the note agreement to include taking possession of the collateral or seeking satisfaction from the guarantors. The Company has been notified by the lender regarding the Events of Default. Guarantors under the mortgage loan include Christopher Brogdon. With our consent, Mr. Brogdon has assumed operations of the facility and is dealing with the lender. The Company is in negotiations with Mr. Brogdon to sell him the facility. In January 2016, the Goodwill facility was closed by Georgia regulators and all residents were removed. In a transaction related to the sale of the Greene Point facility, an affiliate of the buyer of Greene Point executed a ten year operating lease covering Goodwill. After investing approximately $2.0 million in capital improvements in the property, the lease operator obtained all regulatory approvals and began admitting patients in December 2016. The lease became effective on February 1, 2017, and the facility began generating rental revenue thereafter. Lease agreement dated May 21, 2014 with lease payments commencing February 1, 2015. On May 10, 2016, the Company obtained a Court Order appointing a Receiver to control and operate the Southern Hills SNF. The former lease operator represented that it was unable to meet the financial commitments of the facility, including the payment of rent, payroll and other operating requirements. In October 2017, the Receiver engaged a new manager for the facility at the request of the Company. Monthly lease income reflects rent income on a straight-line basis over, where applicable, the term of each lease.

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8% Cumulative, Convertible, Non-voting [Member] Property, Plant and Equipment, Type [Axis] Land [Member] Land Improvements [Member] Buildings and Improvements [Member] Furniture, Fixtures and Equipment [Member] Construction in Progress [Member] Related Party [Axis] Middle Georgia Nursing Home [Member] Debt Instrument [Axis] Mortgage Loans [Member] Goodwill Nursing Home [Member] Warrenton Nursing Home [Member] Edward Redeemer Health & Rehab [Member] Providence of Sparta Nursing Home [Member] Long-term Debt, Type [Axis] Other Debt [Member] Senior Unsecured Promissory Notes [Member] Fixed-Rate Mortgage Loans [Member] Variable-Rate Mortgage Loans [Member] GL Nursing Home [Member] Legal Entity [Axis] Southern Tulsa, LLC [Member] Series 2014 A Bonds [Member] Series A Convertible Redeemable Preferred Stock [Member] Series D Convertible Preferred Stock [Member] Fair Value, Hierarchy [Axis] Level 3 [Member] Level 2 [Member] Level 1 [Member] Senior Secured Promissory Notes [Member] Senior Secured Promissory Notes - Related Parties [Member] Mr. Neuman [Member] Lease Arrangement, Type [Axis] Middle Georgia [Member] Warrenton [Member] Goodwill [Member] Edwards Redeemer [Member] Providence [Member] Meadowview [Member] GL Nursing [Member] Southern Hills SNF [Member] Southern Hills ALF [Member] Southern Hills ILF [Member] Senior Secured Notes [Member] Range [Axis] Minimum [Member] Maximum [Member] Southern Hills Retirement Center Line of Credit [Member] Glen Eagle Health & Rehab [Member] Line of Credit [Member] Meadowview Healthcare Center [Member] Series 2014 A First Mortgage Revenue Bonds [Member] Series 2014 B Taxable First Mortgage Revenue Bond [Member] Measurement Input Type [Axis] Volatility [Member] Risk Free Interest Rate [Member] Expected Life [Member] Exercise Price [Member] Equity Components [Axis] Common Stock [Member] Additional Paid-In Capital [Member] Accumulated Deficit [Member] Non-controlling Interests [Member] Debt Security Category [Axis] States and Municipalities [Member] Segments [Axis] Real Estate Services [Member] Healthcare Services [Member] Series A Preferred Stock [Member] Series D Preferred Stock [Member] Consolidated Entities [Axis] Global Healthcare REIT, Inc Stockholders' Equity [Member] Warrant [Member] Abbeville [Member] Type of Arrangement and Non-arrangement Transactions [Axis] Management Agreement [Member] Cadence Healthcare Solutions [Member] Lender Name [Axis] Healthcare Management of Oklahoma, LLC [Member] Product and Service [Axis] Rental Revenue [Member] Healthcare Revenue [Member] Glen Eagle Health & Rehab Line of Credit [Member] Scenario [Axis] February 2019 [Member] Infinity Health Interests, LLC [Member] Title of Individual [Axis] Director [Member] Senior Secured Promissory Notes [Member] Related Parties [Member] Notes and Warrants [Member] Series 2014A First Mortgage Revenue Bonds [Member] 2014B Taxable First Mortgage Revenue Bond [Member] Directors and Executive Officers [Member] Directors [Member] Employment Agreement [Member] Zvi Rhine [Member] Award Date [Axis] January 1, 2019 [Member] January 1, 2020 [Member] 10% Notes [Member] Preferred Stock [Member] Award Type [Axis] Restricted Stock [Member] Restricted Stock [Member] Glen Eagle [Member] Subsequent Event Type [Axis] Subsequent Event [Member] Restricted Common Stock [Member] January 19, 2019 to January 20, 2020 [Member] Director One [Member] Director Two [Member] Director Three [Member] April 1, 2019 [Member] Document And Entity Information Entity Registrant Name Entity Central Index Key Document Type Document Period End Date Amendment Flag Current Fiscal Year End Date Entity Filer Category Entity Small Business Flag Entity Emerging Growth Company Entity Ex Transition Period Entity Common Stock, Shares Outstanding Trading Symbol Document Fiscal Period Focus Document Fiscal Year Focus Statement [Table] Statement [Line Items] ASSETS Property and Equipment, Net Cash and Cash Equivalents Restricted Cash Accounts Receivable, Net Investments in Debt Securities Prepaid Expenses and Other Total Assets LIABILITIES AND EQUITY Liabilities Debt, Net of discount of $483,590 and $507,829, respectively Debt - Related Parties, Net of discount of $0 and $0, respectively Accounts Payable and Accrued Liabilities Accounts Payable - Related Parties Dividends Payable Derivative Liability Lease Security Deposit Total Liabilities Commitments and Contingencies Equity Stockholders' Equity Preferred Stock: Common Stock - $0.05 Par Value; 50,000,000 Shares Authorized, 27,077,404 and 26,300,317 Shares Issued and Outstanding at March 31, 2019 and December 31, 2018, Respectively Additional Paid-In Capital Accumulated Deficit Total Global Healthcare REIT, Inc. Stockholders' Equity Noncontrolling Interests Total Equity Total Liabilities and Equity Debt discount Debt discount of related parties Preferred stock, par value Preferred stock, shares authorized Preferred stock, shares issued Preferred stock, shares outstanding Common stock, par value Common stock, shares authorized Common stock, shares issued Common stock, shares outstanding Revenue Total Revenue Expenses General and Administrative Property Taxes, Insurance and Other Operating Depreciation Total Expenses Income from Operations Other (Income) Expense Gain on Warrant Liability Gain on Extinguishment of Debt Loss on Settlement of Other Liabilities Gain on Sale of Investments Gain on Proceeds from Insurance Claim Interest Income Interest Expense Total Other (Income) Expense Net Income (Loss) Net Loss Attributable to Noncontrolling Interests EX-101.PRE 10 gbcs-20190331_pre.xml XBRL PRESENTATION FILE XML 11 R1.htm IDEA: XBRL DOCUMENT

Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Mar. 31, 2019	May 20, 2019
Document And Entity Information
Entity Registrant Name	GLOBAL HEALTHCARE REIT, INC.
Entity Central Index Key	0000727346
Document Type	10-Q
Document Period End Date	Mar. 31, 2019
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Small Business Flag	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Common Stock, Shares Outstanding		27,350,131
Trading Symbol	GBCS
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2019

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Consolidated Balance Sheets (Unaudited) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
ASSETS
Property and Equipment, Net	$ 36,524,474	$ 35,885,145
Cash and Cash Equivalents	386,124	1,100,218
Restricted Cash	228,515	206,989
Accounts Receivable, Net	435,659	166,696
Investments in Debt Securities	12,134	162,106
Prepaid Expenses and Other	902,403	774,733
Total Assets	38,489,309	38,295,887
Liabilities
Debt, Net of discount of $483,590 and $507,829, respectively	35,744,057	35,721,341
Debt - Related Parties, Net of discount of $0 and $0, respectively	875,000	875,000
Accounts Payable and Accrued Liabilities	298,886	306,437
Accounts Payable - Related Parties	93,406	118,230
Dividends Payable	7,500	7,500
Derivative Liability	2,682	2,785
Lease Security Deposit	280,000	280,000
Total Liabilities	37,301,531	37,311,293
Commitments and Contingencies Equity
Stockholders' Equity
Common Stock - $0.05 Par Value; 50,000,000 Shares Authorized, 27,077,404 and 26,300,317 Shares Issued and Outstanding at March 31, 2019 and December 31, 2018, Respectively	1,353,870	1,340,234
Additional Paid-In Capital	10,174,041	10,137,148
Accumulated Deficit	(10,913,810)	(11,070,606)
Total Global Healthcare REIT, Inc. Stockholders' Equity	1,390,101	1,182,776
Noncontrolling Interests	(202,323)	(198,182)
Total Equity	1,187,778	984,594
Total Liabilities and Equity	38,489,309	38,295,887
Series A - No Dividends, Non-voting [Member]
Stockholders' Equity
Preferred Stock:	401,000	401,000
Series D - 8% Cumulative, Convertible, Non-voting [Member]
Stockholders' Equity
Preferred Stock:	$ 375,000	$ 375,000

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Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Debt discount	$ 483,590	$ 507,829
Debt discount of related parties	$ 0	$ 0
Common stock, par value	$ 0.05	$ 0.05
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	27,077,404	26,300,317
Common stock, shares outstanding	27,077,404	26,300,317
Series A - No Dividends, Non-voting [Member]
Preferred stock, par value	$ 2.00	$ 2.00
Preferred stock, shares authorized	2,000,000	2,000,000
Preferred stock, shares issued	200,500	200,500
Preferred stock, shares outstanding	200,500	200,500
Series D - 8% Cumulative, Convertible, Non-voting [Member]
Preferred stock, par value	$ 1.00	$ 1.00
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued	375,000	375,000
Preferred stock, shares outstanding	375,000	375,000

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Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Revenue
Total Revenue	$ 1,275,079	$ 812,065
Expenses
General and Administrative	193,479	145,155
Property Taxes, Insurance and Other Operating	349,188	80,816
Depreciation	322,925	305,410
Total Expenses	865,592	531,381
Income from Operations	409,487	280,684
Other (Income) Expense
Gain on Warrant Liability	(103)	(40,423)
Gain on Extinguishment of Debt		(94,925)
Loss on Settlement of Other Liabilities		29,900
Gain on Sale of Investments	(1,069)
Gain on Proceeds from Insurance Claim	(270,264)
Interest Income	(5,467)
Interest Expense	526,235	598,366
Total Other (Income) Expense	249,332	492,918
Net Income (Loss)	160,155	(212,234)
Net Loss Attributable to Noncontrolling Interests	4,141	7,901
Net Income (Loss) Attributable to Global Healthcare REIT, Inc.	164,296	(204,333)
Series D Preferred Dividends	(7,500)	(7,500)
Net Income (Loss) Attributable to Common Stockholders	$ 156,796	$ (211,833)
Net Income (Loss) per Share Attributable to Common Stockholders:
Basic	$ 0.01	$ (0.01)
Diluted	$ 0.01	$ (0.01)
Weighted Average Common Shares Outstanding:
Basic	26,895,586	26,662,817
Diluted	26,895,586	26,662,817
Rental Revenue [Member]
Revenue
Total Revenue	$ 895,288	$ 812,065
Healthcare Revenue [Member]
Revenue
Total Revenue	$ 379,791

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Consolidated Statement of Changes in Equity (Unaudited) - USD ($)	Series A Preferred Stock [Member]	Series D Preferred Stock [Member]	Common Stock [Member]	Additional Paid-In Capital [Member]	Accumulated Deficit [Member]	Non-controlling Interests [Member]	Global Healthcare REIT, Inc Stockholders' Equity [Member]	Total
Balance at Dec. 31, 2017	$ 401,000	$ 375,000	$ 1,315,016	$ 9,422,924	$ (9,048,443)	$ (183,339)	$ 2,465,497	$ 2,282,158
Balance, Shares at Dec. 31, 2017	200,500	375,000	26,300,317
Share Based Compensation - Restricted Stock Awards			$ 28,125	16,875			45,000	45,000
Share Based Compensation - Restricted Stock Awards, shares			562,500
Series D Preferred Dividends					(7,500)		(7,500)	(7,500)
Loss on Modification of Warrants Triggering Extinguishment of Debt				29,900			29,900	29,900
Net income (Loss)					(204,333)	(7,901)	(204,333)	(212,234)
Balance at Mar. 31, 2018	$ 401,000	$ 375,000	$ 1,343,141	9,469,699	(9,260,276)	(191,240)	2,328,564	2,137,324
Balance, Shares at Mar. 31, 2018	200,500	375,000	26,862,817
Balance at Dec. 31, 2017	$ 401,000	$ 375,000	$ 1,315,016	9,422,924	(9,048,443)	(183,339)	2,465,497	2,282,158
Balance, Shares at Dec. 31, 2017	200,500	375,000	26,300,317
Net income (Loss)								2,007,006
Balance at Dec. 31, 2018	$ 401,000	$ 375,000	$ 1,340,234	10,137,148	(11,070,606)	(198,182)	1,182,776	984,594
Balance, Shares at Dec. 31, 2018	200,500	375,000	26,804,677
Series D Preferred Dividends					(7,500)		(7,500)	(7,500)
Share Based Compensation - Restricted Stock Awards and Stock Options			$ 13,636	36,893			50,529	50,529
Share Based Compensation - Restricted Stock Awards and Stock Options, shares			272,727
Net income (Loss)					164,296	(4,141)	164,296	160,155
Balance at Mar. 31, 2019	$ 401,000	$ 375,000	$ 1,353,870	$ 10,174,041	$ (10,913,810)	$ (202,323)	$ 1,390,101	$ 1,187,778
Balance, Shares at Mar. 31, 2019	200,500	375,000	27,077,404

- Definition

The consolidated profit or loss for the period, net of income taxes, including the portion attributable to the noncontrolling interest.

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+ Details

XML 16 R6.htm IDEA: XBRL DOCUMENT

Consolidated Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018	Dec. 31, 2017
Cash Flows From Operating Activities:
Net income (loss)	$ 160,155	$ (212,234)	$ 2,007,006	$ 3,001,618
Adjustments to Reconcile Net Income (Loss) to Net Cash Provided by Operating Activities:
Depreciation	322,925	305,410
Amortization and Accretion	33,124	45,047
Increase in Deferred Rent Receivable	(22,089)	(23,736)
Stock Based Compensation	50,529	45,000
Gain on Sale of Investments	(1,069)
Loss on Extinguishment of Debt		29,900
Gain on Settlement of Debt		(94,925)
Gain on Derivative Liability	(103)	(40,423)
Changes in Operating Assets and Liabilities, Net of Assets and Liabilities Acquired:
Accounts & Rents Receivable	(268,963)	52,796
Prepaid Expenses	38,085	(45,979)
Accounts Payable and Accrued Liabilities	(46,455)	147,464
Cash Provided by Operating Activities	266,139	208,320
Cash Flows From Investing Activities:
Issuance of Note Receivable	(143,666)
Purchase of Investments in Debt Securities		(34,576)
Proceeds from Sale of Investments in Debt Securities	151,041
Capital Expenditures on Property and Equipment Additions	(962,254)	(143,445)
Cash Used in Investing Activities	(954,879)	(178,021)
Cash Flows From Financing Activities:
Proceeds from Issuance of Debt, Outside Parties	159,875	52,862
Payments on Debt, Outside Parties	(147,318)	(132,448)
Deferred Loan Costs Paid	(8,885)
Dividends Paid on Preferred Stock	(7,500)	(7,500)
Cash Used In Financing Activities	(3,828)	(87,086)
Net Decrease in Cash	(692,568)	(56,787)
Cash and Cash Equivalent and Restricted Cash at Beginning of the Year	1,307,207	972,148	972,148
Cash and Cash Equivalent and Restricted Cash at End of the Year	614,639	915,361	1,307,207	$ 972,148
Supplemental Disclosure of Cash Flow Information
Cash Paid for Interest	506,367	453,698
Cash Paid for Income Taxes
Cash and Cash Equivalent	386,124	105,486	1,100,218
Restricted Cash	228,515	809,875	$ 206,989
Total Cash and Cash Equivalent and Restricted Cash	614,639	915,361
Supplemental Schedule of Non-Cash Investing and Financing Activities
Dividends declared on Series D Preferred Stock	7,500	7,500
Offers from Line of Credit to Settle Bonds Payable		$ 380,075

XML 17 R7.htm IDEA: XBRL DOCUMENT

Organization and Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Summary of Significant Accounting Policies

1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization and Description of the Business

Basis of Presentation

Recently Adopted Accounting Pronouncements

Recently Issued Accounting Pronouncements

XML 18 R8.htm IDEA: XBRL DOCUMENT

Going Concern

3 Months Ended

Mar. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Going Concern

2. GOING CONCERN

The accompanying consolidated financial statements and notes have been prepared assuming the Company will continue as a going concern.

XML 19 R9.htm IDEA: XBRL DOCUMENT

Property and Equipment

3 Months Ended

Mar. 31, 2019

Property, Plant and Equipment [Abstract]

Property and Equipment

3. PROPERTY AND EQUIPMENT

The gross carrying amount and accumulated depreciation of the Company’s property and equipment as of March 31, 2019 and December 31, 2018 are as follows:

	March 31, 2019			December 31, 2018

Land	$	1,597,500		$	1,597,500
Land Improvements		200,000			200,000
Buildings and Improvements		36,126,867			36,076,632
Furniture, Fixtures and Equipment		1,475,923			1,469,976
Construction in Progress		4,822,259			3,916,187
		44,222,549			43,260,295

Less Accumulated Depreciation		(6,138,075	)		(5,815,150	)
Less Impairment		(1,560,000	)		(1,560,000	)

	$	36,524,474		$	35,885,145

	For the Three Months Ended March 31,
	2019		2018

Depreciation Expense	$	322,925	$	305,410
Cash Paid for Capital Expenditures	$	962,254	$	143,445

XML 20 R10.htm IDEA: XBRL DOCUMENT

Investments in Debt Securities

3 Months Ended

Mar. 31, 2019

Investments, Debt and Equity Securities [Abstract]

Investments in Debt Securities

4. INVESTMENTS IN DEBT SECURITIES

	March 31, 2019		December 31, 2018

States and Municipalities	$	12,134	$	162,106

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Notes Receivable

3 Months Ended

Mar. 31, 2019

Receivables [Abstract]

Notes Receivable

5. NOTES RECEIVABLE

Note Receivable – Receiver for Healthcare Management of Oklahoma, LLC

Note Receivable: Accounts Receivable Line of Credit (“ARLOC”) – Infinity Health Interests, LLC

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Debt and Debt-Related Parties

3 Months Ended

Mar. 31, 2019

Debt Disclosure [Abstract]

Debt and Debt-Related Parties

6. DEBT AND DEBT-RELATED PARTIES

The following is a summary of the Company’s debt outstanding as of March 31, 2019 and December 31, 2018:

	March 31, 2019			December 31, 2018

Senior Secured Promissory Notes	$	1,485,000		$	1,485,000
Senior Unsecured Promissory Notes		300,000			300,000
Senior Secured Promissory Notes - Related Parties		875,000			875,000
Fixed-Rate Mortgage Loans		20,902,663			21,049,981
Variable-Rate Mortgage Loans		4,618,006			4,618,006
Line of Credit		7,385,978			7,240,183
Other Debt		1,536,000			1,536,000

		37,102,647			37,104,170

Premium, Unamortized Discount and Debt Issuance Costs		(483,590	)		(507,829	)

	$	36,619,057		$	36,596,341

As presented in the Consolidated Balance Sheets:

Debt, Net	$	35,744,057		$	35,721,341

Debt - Related Parties, Net		875,000			875,000

	$	36,619,057		$	36,596,341

Corporate Senior and Senior Secured Promissory Notes

The value of the warrants issued to the note holders was calculated using the Black-Scholes pricing model using the following significant assumptions:

	December 31, 2018

Volatility		122% - 123	%
Risk-free Interest Rate		2.76% - 2.94	%
Exercise Price	$	0.50
Fair Value of Common Stock	$	0.30 - $0.35
Expected Life		2.9 – 3.0 years

Mortgage Loans and Lines of Credit Secured by Real Estate

	Face		Principal Outstanding at				Stated Interest	Maturity
Property	Amount		March 31, 2019		December 31, 2018		Rate	Date

Southern Hills Retirement Center Line of Credit ⁽¹⁾⁽²⁾	$	7,229,052	$	7,105,218	$	7,119,743	5.25% Fixed	April 28, 2019
Middle Georgia Nursing Home ^(2,3)		3,570,000		3,533,486		3,561,461	5.50% Fixed	October 26, 2021
Goodwill Nursing Home ⁽²⁾		5,005,000		4,355,739		4,390,082	5.50% Fixed	March 19, 2020
Warrenton Nursing Home ⁽⁴⁾		2,720,000		2,270,447		2,287,323	5.50% Fixed	January 20, 2020
Edward Redeemer Health & Rehab		2,303,815		2,118,284		2,138,128	5.50% Fixed	January 16, 2020
Glen Eagle Health & Rehab ⁽⁵⁾		2,761,250		2,743,557		2,761,250	5.50% Fixed	May 25, 2021
Glen Eagle Health and Rehab Line of Credit ⁽²⁾⁽⁵⁾		400,000		280,760		120,440	6.50% Fixed	September 30, 2019
Providence of Sparta Nursing Home ⁽⁶⁾		3,039,300		2,961,250		2,975,337	3.88% Fixed	November 1, 2047
Meadowview Healthcare Center ⁽⁷⁾		3,000,000		2,919,900		2,936,400	6.00% Fixed	October 30, 2022
GL Nursing Home ⁽⁸⁾		5,000,000		4,618,006		4,618,006	Prime Plus 1.50%/ 5.75% Floor	August 3, 2037

			$	32,906,647	$	32,908,170

(3) The loan at Middle Georgia was renewed on November 26, 2018 with the maturity extended to October 26, 2021.

Bonds Payable - Tulsa County Industrial Authority

Other Debt

Other debt due at March 31, 2019 and December 31, 2018 includes unsecured notes payable issued to entities controlled by the Company used to facilitate the acquisition of the nursing home properties.

Face

Principal Outstanding at

Stated Interest

Maturity

Property

Amount

March 31, 2019

December 31, 2018

Rate

Date

Goodwill Nursing Home

2,180,000

1,536,000

13% ⁽¹⁾ Fixed

December 31, 2019

Future maturities and principal reduction payments of all notes and bonds payable listed above for the next five years and thereafter are as follows:

Years
2019	$	19,659,755	⁽¹⁾
2020		9,013,714
2021		5,626,986
2022		64,013
2023		66,541
2024 and after		2,671,638

	$	37,102,647

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Stockholders' Equity

3 Months Ended

Mar. 31, 2019

Equity [Abstract]

Stockholders' Equity

7. STOCKHOLDERS’ EQUITY

Preferred Stock

The Company has authorized 10,000,000 shares of preferred stock. These shares may be issued in series with such rights and preferences as may be determined by the Board of Directors.

Series A Convertible Redeemable Preferred Stock

As of March 31, 2019 and December 31, 2018, the Company has 200,500 shares of Series A Preferred stock outstanding.

Series D Convertible Preferred Stock

As of March 31, 2019 and December 31, 2018, the Company had 375,000 shares of Series D preferred stock outstanding.

Restricted Stock Awards

The following table summarizes the restricted stock unit activity during the three months ended March 31, 2019 and 2018.

	March 31, 2019			March 31, 2018

Outstanding Non-Vested Restricted Stock Units, Beginning		-			-
Granted		272,727			562,500
Vested		(68,182	)		(140,625	)

Outstanding Non-Vested Restricted Stock Units, Ending		204,545			421,875

Common Stock Warrants

Common Stock Options

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Related Parties

3 Months Ended

Mar. 31, 2019

Related Parties

8. RELATED PARTIES

Creative Cyberweb developed and maintains the Company’s website, and is affiliated with CFO Zvi Rhine’s family. The ongoing upkeep is $450 per month.

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Facility Leases

3 Months Ended

Mar. 31, 2019

Leases [Abstract]

Facility Leases

9. FACILITY LEASES

The following table summarizes our leasing arrangements related to the Company’s healthcare facilities at March 31, 2019:

Facility	Monthly Lease Income ⁽¹⁾		Lease Expiration	Renewal Option, if any
Middle Georgia	$	60,000	October 31, 2022	None
Warrenton	$	55,724	June 30, 2026	Term may be extended for one additional ten-year term.
Goodwill ⁽²⁾	$	40,125	February 1, 2027	Term may be extended for one additional five-year term.
Edwards Redeemer	$	48,728	October 31, 2022	Term may be extended for one additional five-year term.
Providence	$	42,519	June 30, 2026	Term may be extended for one additional ten-year term.
Meadowview ⁽³⁾	$	-	October 31, 2023	Term may be extended for one additional five-year term.
GL Nursing ⁽⁴⁾	$	-	-	None
Glen Eagle ⁽⁵⁾	$	-	-	None
Southern Hills SNF ⁽⁶⁾	$	37,000	May 31, 2019	Term may be extended for one additional five-year term.
Southern Hills ALF ⁽⁷⁾		-	-	None
Southern Hills ILF ⁽⁸⁾		-	-	None

(1) Monthly lease income reflects rent income on a straight-line basis over, where applicable, the term of each lease.

(7) The Company plans to operate the Southern Hills ALF through a third-party manager once construction is complete and a state license is secured.

(8) The Company plans to operate the Southern Hills ILF through a third-party manager once renovations are complete. The first residents are expected in July 2019.

Years

2018	$	2,345,240
2019		3,126,946
2020		3,183,242
2021		3,015,544
2022		1,922,794
2023 and Thereafter		5,120,111

	$	18,713,877

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Fair Value Measurements

3 Months Ended

Mar. 31, 2019

Fair Value Disclosures [Abstract]

Fair Value Measurements

10. FAIR VALUE MEASUREMENTS

Level 1— Quoted market prices in active markets for identical assets or liabilities at the measurement date.

A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

Assets and liabilities measured at fair value on a recurring basis as of March 31, 2019 and December 31, 2018 are summarized below:

			Fair Value Measurement
	Total		Level 1		Level 2		Level 3

Warrant Liability	$	2,682	$	-	$	-	$	2,682
Investment in Debt Securities		12,134		12,134		-		-

Fair Value at March 31, 2019	$	14,816	$	12,134	$	-	$	2,682

Warrant Liability	$	2,785	$	-	$	-	$	2,785
Investment in Debt Securities		162,106		162,106		-		-

Fair Value at December 31, 2018	$	164,891	$	162,106	$	-	$	2,785

Because these warrants have full reset adjustments tied to future issuance of equity securities by the Company, it is subject to derivative liability treatment under ASC 815-40-15.

The investments in debt securities are recorded at amortized cost since they are considered held-to-maturity.

The table presented below is a summary of changes in the fair value of the Company’s Level 3 valuation for the three months ended March 31, 2019 and 2018:

	2019			2018

Beginning Balance January 1	$	2,785		$	95,371

Change in Fair Value of Warrant Liability		(103	)		(40,423	)

Ending Balance, March 31	$	2,682		$	54,948

The significant assumptions used in the Black-Scholes option pricing model as of March 31, 2019 and December 31, 2018 include the following:

	March 31, 2019			December 31, 2018

Volatility		147.43	%		63.58% - 91.93	%
Risk-free Interest Rate		2.44	%		2.36% - 2.59	%
Exercise Price	$	1.37		$	0.75 - 1.37
Fair Value of Common Stock	$	0.33		$	0.33
Expected Life		0.49 years			0.45 – 0.99 years

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

XML 27 R17.htm IDEA: XBRL DOCUMENT

Segment Reporting

3 Months Ended

Mar. 31, 2019

Segment Reporting [Abstract]

Segment Reporting

11. SEGMENT REPORTING

	Statements of Operations Items for the Three Months Ended
	March 31, 2019								March 31, 2018
	Real Estate Services			Healthcare Services		Consolidated			Real Estate Services			Healthcare Services			Consolidated
Rental Revenue	$	895,288		$	-	$	895,288		$	812,065		$	-		$	812,065
Healthcare Revenue		-			379,791		379,791			-			-			-
Total Revenue		895,288			379,791		1,275,079			812,065			-			812,065
Expenses
General and Administrative		112,215			81,264		193,479			104,926			40,229			145,155
Property Taxes, Insurance and Other Operating		62,655			286,533		349,188			22,203			58,613			80,816
Depreciation		319,456			3,469		322,925			305,410			-			305,410
Total Expenses		494,326			371,266		865,592			432,539			98,842			531,381
Income (Loss) from Operations		400,962			8,525		409,487			379,526			(98,842	)		280,684
Other (Income) Expense
Gain on Warrant Liability		(103	)		-		(103	)		(40,423	)		-			(40,423	)
Gain on Extinguishment of Debt		-			-		-			(94,925	)		-			(94,925	)
(Gain) Loss on Settlement of Other Liabilities		-			-		-			29,900			-			29,900
Gain on Sale of Investments		(1,069	)		-		(1,069	)
Gain from Insurance Claim		(270,264	)		-		(270,264	)
Interest Income		(5,467	)		-		(5,467	)		-			-			-
Interest Expense		526,235			-		526,235			598,366			-			598,366
Total Other (Income) Expense		249,332			-		249,332			492,918			-			492,918
Net Income (Loss)		151,630			8,525		160,155			(113,392	)		(98,842	)		(212,234	)
Net Loss Attributable to Noncontrolling Interests		4,141			-		4,141			7,901			-			7,901
Net Income (Loss) Attributable to Global Healthcare REIT, Inc.	$	155,771		$	8,525	$	164,296		$	(105,491	)	$	(98,842	)	$	(204,333	)

XML 28 R18.htm IDEA: XBRL DOCUMENT

Legal Proceedings

3 Months Ended

Mar. 31, 2019

Commitments and Contingencies Disclosure [Abstract]

Legal Proceedings

12. LEGAL PROCEEDINGS

The Company and/or its affiliated subsidiaries are involved in the following litigation:

Bailey v. GL Nursing, LLC, et. al in the Circuit Court of Lonoke County, Arkansas, 23rd Circuit, 43CV-19-151.

While it is too early to assess the Company’s exposure, we believe at this time that the likelihood of an adverse outcome is remote.

Southern Tulsa, LLC v. Healthcare Management of Oklahoma, LLC, District Court of Tulsa County, State of Oklahoma, Case No. CJ – 2016- 01781.

Thomas v. Edwards Redeemer Property Holdings, LLC, et.al., District Court for Oklahoma County, Oklahoma, Case No. CJ 2016-2160.

XML 29 R19.htm IDEA: XBRL DOCUMENT

Subsequent Events

3 Months Ended

Mar. 31, 2019

Subsequent Events [Abstract]

Subsequent Events

13. SUBSEQUENT EVENTS

XML 30 R20.htm IDEA: XBRL DOCUMENT

Organization and Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and Description of the Business	Organization and Description of the Business Global Healthcare REIT, Inc. (the Company or Global) was organized with the intent of operating as a real estate investment trust (REIT) for the purpose of investing in real estate and other assets related to the healthcare industry. Prior to the Company changing its name to Global Healthcare REIT, Inc. on September 30, 2013, the Company was known as Global Casinos, Inc. Global Casinos, Inc. operated two gaming casinos which were split-off and sold on September 30, 2013. Simultaneous with the split-off and sale of the gaming operations, the Company acquired West Paces Ferry Healthcare REIT, Inc. (WPF) in a transaction accounted for as a reverse acquisition whereby WPF was deemed to be the accounting acquirer. The Company intends to make a REIT election under sections 856 through 859 of the Internal Revenue Code of 1986, as amended. Such election will be made by the Board of Directors at such time as the Board determines that we qualify as a REIT under applicable provisions of the Internal Revenue Code. The Company acquires, develops, leases, manages and disposes of healthcare real estate, and provides financing to healthcare providers. As of March 31, 2019, the Company owned eleven healthcare properties which are leased or managed by third-party operators under triple-net operating terms.
Basis of Presentation	Basis of Presentation The accompanying unaudited interim consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP) for interim financial information and in conjunction with the rules and regulations of the Securities Exchange Commission. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments considered necessary to make the consolidated financial statements not misleading have been included. Operating results for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the entire year. The unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 filed with the Securities and Exchange Commission.
Recently Adopted Accounting Pronouncements	Recently Adopted Accounting Pronouncements Effective January 1, 2019, the Company adopted ASU No. 2018-07, Compensation – Stock Based Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting (“ASU 2018-7”), which aligns accounting for share-based payments issued to nonemployees to that of employees under the existing guidance of Topic 718, with certain exceptions. This update supersedes previous guidance for equity-based payments to nonemployees under Subtopic 505-50, Equity – Equity-Based Payments to Non-Employees. The adoption of ASU 2018-07 did not have a material impact on the Company’s consolidated financial statements. In February 2016, the Financial Accounting Standards Board issued ASU No. 2016-02, “Leases: Topic 842 (ASU 2016-02)”, to supersede nearly all existing lease guidance under GAAP. The guidance would require lessees to recognize most leases on their balance sheets as lease liabilities with corresponding right-of-use assets. ASU 2016-02 is effective for the Company as of January 1, 2019 and adoption requires using a modified retrospective approach with the option to elect certain practical expedients. The Company has determined that it does not have any leases that fall under the guidance of ASU 2016-02 and it had no impact on its consolidated financial statements.
Recently Issued Accounting Pronouncements	Recently Issued Accounting Pronouncements The Financial Accounting Standards Board and other entities issued new or modifications to, or interpretations of, existing accounting guidance during 2019. Management has carefully considered the new pronouncements that altered generally accepted accounting principles and does not believe that any other new or modified principles will have a material impact on the Company’s reported financial position or operations in the near term.

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Property and Equipment (Tables)

3 Months Ended

Mar. 31, 2019

Property, Plant and Equipment [Abstract]

Schedule of Property Plant and Equipment

The gross carrying amount and accumulated depreciation of the Company’s property and equipment as of March 31, 2019 and December 31, 2018 are as follows:

	March 31, 2019			December 31, 2018

Land	$	1,597,500		$	1,597,500
Land Improvements		200,000			200,000
Buildings and Improvements		36,126,867			36,076,632
Furniture, Fixtures and Equipment		1,475,923			1,469,976
Construction in Progress		4,822,259			3,916,187
		44,222,549			43,260,295

Less Accumulated Depreciation		(6,138,075	)		(5,815,150	)
Less Impairment		(1,560,000	)		(1,560,000	)

	$	36,524,474		$	35,885,145

	For the Three Months Ended March 31,
	2019		2018

Depreciation Expense	$	322,925	$	305,410
Cash Paid for Capital Expenditures	$	962,254	$	143,445

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Investments in Debt Securities (Tables)

3 Months Ended

Mar. 31, 2019

Investments, Debt and Equity Securities [Abstract]

Schedule of Investments in Marketable Securities

	March 31, 2019		December 31, 2018

States and Municipalities	$	12,134	$	162,106

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Debt and Debt-Related Parties (Tables)

3 Months Ended

Mar. 31, 2019

Debt Disclosure [Abstract]

Schedule of Debt Instruments

The following is a summary of the Company’s debt outstanding as of March 31, 2019 and December 31, 2018:

	March 31, 2019			December 31, 2018

Senior Secured Promissory Notes	$	1,485,000		$	1,485,000
Senior Unsecured Promissory Notes		300,000			300,000
Senior Secured Promissory Notes - Related Parties		875,000			875,000
Fixed-Rate Mortgage Loans		20,902,663			21,049,981
Variable-Rate Mortgage Loans		4,618,006			4,618,006
Line of Credit		7,385,978			7,240,183
Other Debt		1,536,000			1,536,000

		37,102,647			37,104,170

Premium, Unamortized Discount and Debt Issuance Costs		(483,590	)		(507,829	)

	$	36,619,057		$	36,596,341

As presented in the Consolidated Balance Sheets:

Debt, Net	$	35,744,057		$	35,721,341

Debt - Related Parties, Net		875,000			875,000

	$	36,619,057		$	36,596,341

Schedule of Weighted Average Assumptions

The value of the warrants issued to the note holders was calculated using the Black-Scholes pricing model using the following significant assumptions:

	December 31, 2018

Volatility		122% - 123	%
Risk-free Interest Rate		2.76% - 2.94	%
Exercise Price	$	0.50
Fair Value of Common Stock	$	0.30 - $0.35
Expected Life		2.9 – 3.0 years

Schedule of Mortgage Loan Debt

Mortgage loans for the periods presented consisted of the following:

	Face		Principal Outstanding at				Stated Interest	Maturity
Property	Amount		March 31, 2019		December 31, 2018		Rate	Date

Southern Hills Retirement Center Line of Credit ⁽¹⁾⁽²⁾	$	7,229,052	$	7,105,218	$	7,119,743	5.25% Fixed	April 28, 2019
Middle Georgia Nursing Home ^(2,3)		3,570,000		3,533,486		3,561,461	5.50% Fixed	October 26, 2021
Goodwill Nursing Home ⁽²⁾		5,005,000		4,355,739		4,390,082	5.50% Fixed	March 19, 2020
Warrenton Nursing Home ⁽⁴⁾		2,720,000		2,270,447		2,287,323	5.50% Fixed	January 20, 2020
Edward Redeemer Health & Rehab		2,303,815		2,118,284		2,138,128	5.50% Fixed	January 16, 2020
Glen Eagle Health & Rehab ⁽⁵⁾		2,761,250		2,743,557		2,761,250	5.50% Fixed	May 25, 2021
Glen Eagle Health and Rehab Line of Credit ⁽²⁾⁽⁵⁾		400,000		280,760		120,440	6.50% Fixed	September 30, 2019
Providence of Sparta Nursing Home ⁽⁶⁾		3,039,300		2,961,250		2,975,337	3.88% Fixed	November 1, 2047
Meadowview Healthcare Center ⁽⁷⁾		3,000,000		2,919,900		2,936,400	6.00% Fixed	October 30, 2022
GL Nursing Home ⁽⁸⁾		5,000,000		4,618,006		4,618,006	Prime Plus 1.50%/ 5.75% Floor	August 3, 2037

			$	32,906,647	$	32,908,170

Schedule of Other Debt

Other debt due at March 31, 2019 and December 31, 2018 includes unsecured notes payable issued to entities controlled by the Company used to facilitate the acquisition of the nursing home properties.

Face

Principal Outstanding at

Stated Interest

Maturity

Property

Amount

March 31, 2019

December 31, 2018

Rate

Date

Goodwill Nursing Home

2,180,000

1,536,000

13% ⁽¹⁾ Fixed

December 31, 2019

Schedule of Future Maturities of Notes Payable

Future maturities and principal reduction payments of all notes and bonds payable listed above for the next five years and thereafter are as follows:

Years
2019	$	19,659,755	⁽¹⁾
2020		9,013,714
2021		5,626,986
2022		64,013
2023		66,541
2024 and after		2,671,638

	$	37,102,647

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.22)
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 1A
-URI http://asc.fasb.org/extlink&oid=114775744&loc=d3e28541-108399

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=109259400&loc=d3e21506-112644

Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(e),(f))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 5: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=114775744&loc=d3e28551-108399

Reference 6: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=109259400&loc=d3e21521-112644

Reference 7: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=109259400&loc=d3e21538-112644

Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 470
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=75038535&loc=d3e64711-112823

Reference 9: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 55
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=114775985&loc=d3e28878-108400

Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=109259400&loc=d3e21475-112644

+ Details

XML 34 R24.htm IDEA: XBRL DOCUMENT

Stockholders' Equity (Tables)

3 Months Ended

Mar. 31, 2019

Equity [Abstract]

Schedule of Restricted Stock Awards

The following table summarizes the restricted stock unit activity during the three months ended March 31, 2019 and 2018.

	March 31, 2019			March 31, 2018

Outstanding Non-Vested Restricted Stock Units, Beginning		-			-
Granted		272,727			562,500
Vested		(68,182	)		(140,625	)

Outstanding Non-Vested Restricted Stock Units, Ending		204,545			421,875

XML 35 R25.htm IDEA: XBRL DOCUMENT

Facility Leases (Tables)

3 Months Ended

Mar. 31, 2019

Leases [Abstract]

Schedule of Leasing Arrangements

The following table summarizes our leasing arrangements related to the Company’s healthcare facilities at March 31, 2019:

Facility	Monthly Lease Income ⁽¹⁾		Lease Expiration	Renewal Option, if any
Middle Georgia	$	60,000	October 31, 2022	None
Warrenton	$	55,724	June 30, 2026	Term may be extended for one additional ten-year term.
Goodwill ⁽²⁾	$	40,125	February 1, 2027	Term may be extended for one additional five-year term.
Edwards Redeemer	$	48,728	October 31, 2022	Term may be extended for one additional five-year term.
Providence	$	42,519	June 30, 2026	Term may be extended for one additional ten-year term.
Meadowview ⁽³⁾	$	-	October 31, 2023	Term may be extended for one additional five-year term.
GL Nursing ⁽⁴⁾	$	-	-	None
Glen Eagle ⁽⁵⁾	$	-	-	None
Southern Hills SNF ⁽⁶⁾	$	37,000	May 31, 2019	Term may be extended for one additional five-year term.
Southern Hills ALF ⁽⁷⁾		-	-	None
Southern Hills ILF ⁽⁸⁾		-	-	None

(1) Monthly lease income reflects rent income on a straight-line basis over, where applicable, the term of each lease.

(7) The Company plans to operate the Southern Hills ALF through a third-party manager once construction is complete and a state license is secured.

(8) The Company plans to operate the Southern Hills ILF through a third-party manager once renovations are complete. The first residents are expected in July 2019.

Schedule of Future Cash Payments for Rent to be Received During Initial Term of Lease

Years

2018	$	2,345,240
2019		3,126,946
2020		3,183,242
2021		3,015,544
2022		1,922,794
2023 and Thereafter		5,120,111

	$	18,713,877

XML 36 R26.htm IDEA: XBRL DOCUMENT

Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2019

Fair Value Disclosures [Abstract]

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

Assets and liabilities measured at fair value on a recurring basis as of March 31, 2019 and December 31, 2018 are summarized below:

			Fair Value Measurement
	Total		Level 1		Level 2		Level 3

Warrant Liability	$	2,682	$	-	$	-	$	2,682
Investment in Debt Securities		12,134		12,134		-		-

Fair Value at March 31, 2019	$	14,816	$	12,134	$	-	$	2,682

Warrant Liability	$	2,785	$	-	$	-	$	2,785
Investment in Debt Securities		162,106		162,106		-		-

Fair Value at December 31, 2018	$	164,891	$	162,106	$	-	$	2,785

Changes in Fair Value of Company's Level 3 Valuation for Warrant Liability

The table presented below is a summary of changes in the fair value of the Company’s Level 3 valuation for the three months ended March 31, 2019 and 2018:

	2019			2018

Beginning Balance January 1	$	2,785		$	95,371

Change in Fair Value of Warrant Liability		(103	)		(40,423	)

Ending Balance, March 31	$	2,682		$	54,948

Fair Value Measurements, Valuation Techniques

The significant assumptions used in the Black-Scholes option pricing model as of March 31, 2019 and December 31, 2018 include the following:

	March 31, 2019			December 31, 2018

Volatility		147.43	%		63.58% - 91.93	%
Risk-free Interest Rate		2.44	%		2.36% - 2.59	%
Exercise Price	$	1.37		$	0.75 - 1.37
Fair Value of Common Stock	$	0.33		$	0.33
Expected Life		0.49 years			0.45 – 0.99 years

XML 37 R27.htm IDEA: XBRL DOCUMENT

Segment Reporting (Tables)

3 Months Ended

Mar. 31, 2019

Segment Reporting [Abstract]

Schedule of Segment Reporting Information

	Statements of Operations Items for the Three Months Ended
	March 31, 2019								March 31, 2018
	Real Estate Services			Healthcare Services		Consolidated			Real Estate Services			Healthcare Services			Consolidated
Rental Revenue	$	895,288		$	-	$	895,288		$	812,065		$	-		$	812,065
Healthcare Revenue		-			379,791		379,791			-			-			-
Total Revenue		895,288			379,791		1,275,079			812,065			-			812,065
Expenses
General and Administrative		112,215			81,264		193,479			104,926			40,229			145,155
Property Taxes, Insurance and Other Operating		62,655			286,533		349,188			22,203			58,613			80,816
Depreciation		319,456			3,469		322,925			305,410			-			305,410
Total Expenses		494,326			371,266		865,592			432,539			98,842			531,381
Income (Loss) from Operations		400,962			8,525		409,487			379,526			(98,842	)		280,684
Other (Income) Expense
Gain on Warrant Liability		(103	)		-		(103	)		(40,423	)		-			(40,423	)
Gain on Extinguishment of Debt		-			-		-			(94,925	)		-			(94,925	)
(Gain) Loss on Settlement of Other Liabilities		-			-		-			29,900			-			29,900
Gain on Sale of Investments		(1,069	)		-		(1,069	)
Gain from Insurance Claim		(270,264	)		-		(270,264	)
Interest Income		(5,467	)		-		(5,467	)		-			-			-
Interest Expense		526,235			-		526,235			598,366			-			598,366
Total Other (Income) Expense		249,332			-		249,332			492,918			-			492,918
Net Income (Loss)		151,630			8,525		160,155			(113,392	)		(98,842	)		(212,234	)
Net Loss Attributable to Noncontrolling Interests		4,141			-		4,141			7,901			-			7,901
Net Income (Loss) Attributable to Global Healthcare REIT, Inc.	$	155,771		$	8,525	$	164,296		$	(105,491	)	$	(98,842	)	$	(204,333	)

XML 38 R28.htm IDEA: XBRL DOCUMENT

Going Concern (Details Narrative) - USD ($)	3 Months Ended		12 Months Ended
Going Concern (Details Narrative) - USD ($)	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018	Dec. 31, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Net loss	$ (160,155)	$ 212,234	$ (2,007,006)	$ (3,001,618)
Cash Provided by Operating Activities	266,139	$ 208,320
Accumulated deficit	$ (10,913,810)		$ (11,070,606)

- Definition

The consolidated profit or loss for the period, net of income taxes, including the portion attributable to the noncontrolling interest.

+ References

+ Details

XML 39 R29.htm IDEA: XBRL DOCUMENT

Property and Equipment - Schedule of Property Plant and Equipment (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Property and Equipment, Gross	$ 44,222,549		$ 43,260,295
Less Accumulated Depreciation	(6,138,075)		(5,815,150)
Less Impairment	(1,560,000)		(1,560,000)
Property and Equipment, Net	36,524,474		35,885,145
Depreciation Expense	322,925	$ 305,410
Cash Paid for Capital Expenditures	962,254	$ 143,445
Land [Member]
Property and Equipment, Gross	1,597,500		1,597,500
Land Improvements [Member]
Property and Equipment, Gross	200,000		200,000
Buildings and Improvements [Member]
Property and Equipment, Gross	36,126,867		36,076,632
Furniture, Fixtures and Equipment [Member]
Property and Equipment, Gross	1,475,923		1,469,976
Construction in Progress [Member]
Property and Equipment, Gross	$ 4,822,259		$ 3,916,187

XML 40 R30.htm IDEA: XBRL DOCUMENT

Investments in Debt Securities (Details Narrative) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Investments, Debt and Equity Securities [Abstract]
Contractual maturity of held-to-maturity securities at September 1, 2043	$ 30,000
Proceeds from sale of debt securities	151,041
Gain on sale of investments	$ (1,069)

XML 41 R31.htm IDEA: XBRL DOCUMENT

Investments in Debt Securities - Schedule of Investments in Marketable Securities (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Investments in marketable securities	$ 12,134	$ 162,106
States and Municipalities [Member]
Investments in marketable securities	$ 12,134	$ 162,106

XML 42 R32.htm IDEA: XBRL DOCUMENT

Notes Receivable (Details Narrative) - USD ($)	1 Months Ended	12 Months Ended
Notes Receivable (Details Narrative) - USD ($)	Nov. 30, 2017	Dec. 31, 2016	Mar. 31, 2019	Dec. 31, 2018	May 10, 2016
Accounts receivable line of credit			$ 435,659	$ 166,696
Healthcare Management of Oklahoma, LLC [Member]
Line of credit facility, maximum borrowing capacity		$ 150,000			$ 250,000
Bad debt expense		$ 150,000
Short term loan	$ 84,000
Infinity Health Interests, LLC [Member]
Accounts receivable line of credit			250,000
Loan amount, lent			$ 250,000	$ 106,334

XML 43 R33.htm IDEA: XBRL DOCUMENT

Debt and Debt-Related Parties (Details Narrative) - USD ($)			1 Months Ended		3 Months Ended		12 Months Ended
	May 03, 2018	Mar. 01, 2014	Oct. 31, 2018	Oct. 31, 2017	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Nov. 30, 2017
Gain on extinguishment of debt						$ (94,925)
Amortization expense					33,124	45,047
Debt instrument, unamortized discount					483,590		$ 507,829
Value of bonds					36,619,057		$ 36,596,341
Other Debt [Member]
Amortization expense for deferred loan costs					33,124	45,047
Proceeds from the issuance of debt					159,875	52,862
Cash payments on debt					147,318	132,448
Southern Tulsa, LLC [Member]
Debt instrument, interest rate										5.25%
Debt instrument, maturity date	Oct. 30, 2018
Notes and Warrants [Member]
Debt instrument, interest rate							10.00%
Debt instrument, maturity date			Oct. 31, 2021				Oct. 31, 2021
Warrants to purchase common stock			111,000
Proceeds from private offering			$ 1,160,000
Proceed from private offering, net			1,092,400
Placement agent fees			67,600
Fair value of warrants			$ 21,453
Aggregate exchangeable units, value							$ 1,075,000
Related Parties [Member] \| Notes and Warrants [Member]
Aggregate exchangeable units, value							$ 875,000
Senior Secured Promissory Notes [Member]
Debt instrument, interest rate			11.00%	10.00%					10.00%
Senior secured promissory notes issued				$ 300,000				$ 500,000	$ 600,000
Debt instrument, maturity date				Oct. 30, 2020				Dec. 31, 2018	Jan. 13, 2018
Warrants to purchase common stock									600,000
Warrants exercise price			$ 0.50	$ 0.75					$ 0.75
Gain on extinguishment of debt								$ 62,696
Warrants description			Warrant for each $1.00 in principal amount of Note exercisable for three years to purchase a share of Common Stock at an exercise price of $0.50 per share.
Debt term			3 years
Senior Secured Promissory Notes [Member] \| Warrant [Member]
Warrants to purchase common stock							1,160,000	900,000
Gain on extinguishment of debt							$ 248,346
Fair value of warrants							207,025	$ 121,435
Aggregate exchangeable units, value							$ 1,075,000
Amortization expense					16,261	$ 19,568
Debt instrument, unamortized discount					196,908			77,105
Senior Secured Promissory Notes [Member] \| Director [Member]
Senior secured promissory notes issued									$ 450,000
Senior Secured Promissory Notes [Member]
Senior secured promissory notes issued								$ 600,000
Warrants to purchase common stock								600,000
Warrants exercise price							$ 0.75
Debt outstanding amount								$ 1,200,000
Senior secured promissory note							$ 225,000
Warrants description								For every $1.00 in principal amount of note, investors got one warrant exercisable for one year to purchase an additional share of common stock at an exercise price of $.75 per share.
Senior Secured Promissory Notes [Member] \| Warrant [Member]
Warrants to purchase common stock								1,200,000
Warrant maturity date								Dec. 31, 2018
Senior Secured Promissory Notes [Member] \| Related Parties [Member]
Senior secured promissory notes issued								$ 425,000
Senior secured promissory note					$ 125,000
10% Notes [Member] \| Notes and Warrants [Member]
Debt instrument, interest rate					10.00%
Debt instrument, maturity date					Dec. 31, 2018
Non - payment of debt					$ 125,000
Series 2014A First Mortgage Revenue Bonds [Member] \| Southern Tulsa, LLC [Member]
Value of bonds		$ 5,075,000
Assets retirement amount								452,000
Series 2014 A First Mortgage Revenue Bonds [Member] \| Southern Tulsa, LLC [Member]
Value of bonds		625,000
2014B Taxable First Mortgage Revenue Bond [Member] \| Southern Tulsa, LLC [Member]
Proceeds from issuance of notes payable								127,000
Assets retirement amount								60,000
Amortization of discount and debt issuance costs								$ 67,000
Series 2014 A Bonds [Member] \| Southern Tulsa, LLC [Member]
Deferred loan costs		478,950
Debt original issue discount		$ 78,140
Series 2014 B Taxable First Mortgage Revenue Bond [Member] \| Southern Tulsa, LLC [Member]
Debt original issue discount					761
Amortization expense for deferred loan costs					4,704
Non-cash principal reduction payments							5,061,000
Restricted cash					$ 1,179		$ 1,179

XML 44 R34.htm IDEA: XBRL DOCUMENT

Debt and Debt-Related Parties - Schedule of Debt Instruments (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Debt instrument, gross	$ 37,102,647	$ 37,104,170
Premium, Unamortized Discount and Debt Issuance Costs	(483,590)	(507,829)
Debt instrument, net of discount	36,619,057	36,596,341
Debt, Net	35,744,057	35,721,341
Debt - Related Parties, Net	875,000	875,000
Debt, total	36,619,057	36,596,341
Senior Secured Promissory Notes [Member]
Debt instrument, gross	1,485,000	1,485,000
Senior Unsecured Promissory Notes [Member]
Debt instrument, gross	300,000	300,000
Senior Secured Promissory Notes - Related Parties [Member]
Debt instrument, gross	875,000	875,000
Fixed-Rate Mortgage Loans [Member]
Debt instrument, gross	20,902,663	21,049,981
Variable-Rate Mortgage Loans [Member]
Debt instrument, gross	4,618,006	4,618,006
Line of Credit [Member]
Debt instrument, gross	7,385,978	7,240,183
Other Debt [Member]
Debt instrument, gross	$ 1,536,000	$ 1,536,000

XML 45 R35.htm IDEA: XBRL DOCUMENT

Debt and Debt-Related Parties - Schedule of Weighted Average Assumptions (Details) - $ / shares	3 Months Ended	12 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Fair Value of Common Stock	$ 0.33	$ 0.33
Minimum [Member] \| Senior Secured Notes [Member]
Fair Value of Common Stock		0.30
Maximum [Member] \| Senior Secured Notes [Member]
Fair Value of Common Stock		$ 0.35
Volatility [Member]
Fair value measurements valuation techniques, percent	147.43%
Volatility [Member] \| Minimum [Member]
Fair value measurements valuation techniques, percent		63.58%
Volatility [Member] \| Minimum [Member] \| Senior Secured Notes [Member]
Fair value measurements valuation techniques, percent		122.00%
Volatility [Member] \| Maximum [Member]
Fair value measurements valuation techniques, percent		91.93%
Volatility [Member] \| Maximum [Member] \| Senior Secured Notes [Member]
Fair value measurements valuation techniques, percent		123.00%
Risk Free Interest Rate [Member]
Fair value measurements valuation techniques, percent	2.44%
Risk Free Interest Rate [Member] \| Minimum [Member]
Fair value measurements valuation techniques, percent		2.36%
Risk Free Interest Rate [Member] \| Minimum [Member] \| Senior Secured Notes [Member]
Fair value measurements valuation techniques, percent		2.76%
Risk Free Interest Rate [Member] \| Maximum [Member]
Fair value measurements valuation techniques, percent		2.59%
Risk Free Interest Rate [Member] \| Maximum [Member] \| Senior Secured Notes [Member]
Fair value measurements valuation techniques, percent		2.94%
Exercise Price [Member]
Fair value measurements valuation techniques, exercise price	$ 1.37
Exercise Price [Member] \| Senior Secured Notes [Member]
Fair value measurements valuation techniques, exercise price		$ 0.50
Exercise Price [Member] \| Minimum [Member]
Fair value measurements valuation techniques, exercise price		0.75
Exercise Price [Member] \| Maximum [Member]
Fair value measurements valuation techniques, exercise price		$ 1.37
Expected Life [Member]
Fair value measurements valuation techniques, term	5 months 27 days
Expected Life [Member] \| Minimum [Member]
Fair value measurements valuation techniques, term		5 months 12 days
Expected Life [Member] \| Minimum [Member] \| Senior Secured Notes [Member]
Fair value measurements valuation techniques, term		2 years 10 months 25 days
Expected Life [Member] \| Maximum [Member]
Fair value measurements valuation techniques, term		11 months 26 days
Expected Life [Member] \| Maximum [Member] \| Senior Secured Notes [Member]
Fair value measurements valuation techniques, term		3 years

XML 46 R36.htm IDEA: XBRL DOCUMENT

Debt and Debt-Related Parties - Schedule of Mortgage Loan Debt (Details) - Mortgage Loans [Member] - USD ($)

3 Months Ended

Mar. 31, 2019

Dec. 31, 2018

Long-term Debt, Gross

$ 32,906,647

$ 32,908,170

Southern Hills Retirement Center Line of Credit [Member]

Debt Instrument, Face Amount

^[1],[2]

7,229,052

Long-term Debt, Gross

^[1],[2]

$ 7,105,218

7,119,743

Debt Instrument, Interest Rate Terms

^[1],[2]

5.25% Fixed

Debt instrument, maturity date

^[1],[2]

Apr. 28, 2019

Middle Georgia Nursing Home [Member]

Debt Instrument, Face Amount

^[1],[3]

$ 3,570,000

Long-term Debt, Gross

^[1]

$ 3,533,486

^[3]

3,561,461

^[4]

Debt Instrument, Interest Rate Terms

^[1],[4]

5.50% Fixed

Debt instrument, maturity date

^[1],[4]

Oct. 26, 2021

Goodwill Nursing Home [Member]

Debt Instrument, Face Amount

^[1]

$ 5,005,000

Long-term Debt, Gross

^[1]

$ 4,355,739

4,390,082

Debt Instrument, Interest Rate Terms

^[1]

5.50% Fixed

Debt instrument, maturity date

^[1]

Mar. 19, 2020

Warrenton Nursing Home [Member]

Debt Instrument, Face Amount

^[3]

$ 2,720,000

Long-term Debt, Gross

^[3]

$ 2,270,447

2,287,323

Debt Instrument, Interest Rate Terms

^[3]

5.50% Fixed

Debt instrument, maturity date

^[3]

Jan. 20, 2020

Edward Redeemer Health & Rehab [Member]

Debt Instrument, Face Amount

$ 2,303,815

Long-term Debt, Gross

$ 2,118,284

2,138,128

Debt Instrument, Interest Rate Terms

5.50% Fixed

Debt instrument, maturity date

Jan. 16, 2020

Glen Eagle Health & Rehab [Member]

Debt Instrument, Face Amount

^[5]

$ 2,761,250

Long-term Debt, Gross

^[5]

$ 2,743,557

2,761,250

Debt Instrument, Interest Rate Terms

^[5]

5.50% Fixed

Debt instrument, maturity date

^[5]

May 25, 2021

Glen Eagle Health & Rehab Line of Credit [Member]

Debt Instrument, Face Amount

^[1],[5]

$ 400,000

Long-term Debt, Gross

^[1],[5]

$ 280,760

120,440

Debt Instrument, Interest Rate Terms

^[1],[5]

6.50% Fixed

Debt instrument, maturity date

^[1],[5]

Sep. 30, 2019

Providence of Sparta Nursing Home [Member]

Debt Instrument, Face Amount

^[6]

$ 3,039,300

Long-term Debt, Gross

^[6]

$ 2,961,250

2,975,337

Debt Instrument, Interest Rate Terms

^[6]

3.88% Fixed

Debt instrument, maturity date

^[6]

Nov. 01, 2047

Meadowview Healthcare Center [Member]

Debt Instrument, Face Amount

^[7]

$ 3,000,000

Long-term Debt, Gross

^[7]

$ 2,919,900

2,936,400

Debt Instrument, Interest Rate Terms

^[7]

6.00% Fixed

Debt instrument, maturity date

^[7]

Oct. 30, 2022

GL Nursing Home [Member]

Debt Instrument, Face Amount

^[8]

$ 5,000,000

Long-term Debt, Gross

^[8]

$ 4,618,006

Debt Instrument, Interest Rate Terms

^[7]

Prime Plus 1.50%/ 5.75% Floor

Debt instrument, maturity date

^[7]

Aug. 03, 2037

[1]	Mortgage loans are non-recourse to the Company except for (i) the senior loan held by ServisFirst Bank on Meadowview (Ohio), (ii) the loan held by Colony Bank on Middle Georgia and Glen Eagle, and (iii) the Southern Hills line of credit and Goodwill loan owed to Southern Bank (formerly First Commercial Bank).
[2]	On October 31, 2017, the Company, through its wholly-owned subsidiaries Southern Tulsa, LLC and Southern Tulsa TLC, LLC, as Co-Borrowers, consummated a new Line of Credit with Southern Bank (formerly First Commercial Bank) pursuant to a Promissory Note in the principal amount of $7,229,052 (the "Line of Credit"). Under the Line of Credit, the Company refinanced the prior mortgage on its skilled nursing facility in Tulsa for $1,546,801,funded open market and tender offer purchases of its Industrial Revenue Bonds covering the ALF and ILF as well as provided working capital for improvements to the ALF and ILF. As of December 31, 2018, a total of $7,119,743 was drawn under the Line of Credit, and as of March 31, 2019, a total of $7,105,218 was drawn under the Line of Credit. The interest rate on the Line of Credit is 5.25%. Monthly payments of interest began on November 30, 2017 and continue until the Promissory Note is paid in full on the Maturity Date. On May 3, 2018 the Maturity Date was extended from April 30, 2018 to October 30, 2018. The Maturity Date was further extended to February 28, 2019 and subsequently to April 28, 2019, with the intent to convert to an amortizing loan thereafter. The Credit Note is secured by a First Mortgage and Assignment of Rents on Real Property for Southern Hills Rehabilitation Center, a Junior Lien and Assignment of Rents on Real Property for it Southern Hills Independent Living Facility location and a Junior Lien on Real Property for its Southern Hills Assisted Living Facility location. With the retirement of the Tulsa Industrial Authority Bonds effective November 1, 2018, Southern Bank (formerly First Commercial Bank) moved into a senior position on the ALF and ILF properties.
[3]	The loan was extended on January 19, 2019 to January 20, 2020 and the Company capitalized $8,885 in loan costs paid, amortized over the term of the extension. Amortization expense related to loan costs of this loan totaled $2,050 for the three months ended March 31, 2019. The Company has incurred $43,681 in unamortized loan costs to refinance this debt with another lender.
[4]	The loan at Middle Georgia was renewed on November 26, 2018 with the maturity extended to October 26, 2021.
[5]	Amortization expense related to loan costs of this loan totaled $219 for the three months ended March 31, 2019. Amortizing payments began in January 2019. In June 2018 the Company converted the original note to a fixed note which qualified as debt extinguishment, unamortized debt discount on the original note was expensed as a loss on extinguishment of $27,794. In April 2018, the Company capitalized $22,800 in fees and interest and added it to principal. The Company is subject to financial covenants and customary affirmative and negative covenants, including compliance with the covenants of all other notes and bonds. As of March 31, 2019, the Company was not in compliance with some unrelated notes and bonds, which is considered to be a technical Event of Default as defined in the note agreement, but the Company believes that it is in good standing with the Lender. In October 2018 the Lender extended the Company a line of credit with a limit of $200,365 to provide working capital to scale operations at the facility. As of December 31, 2018 the Company had drawn $120,440 on the line. The line of credit was expanded in February 2019 to $400,000 with a maturity of September 30, 2019. As of March 31, 2019, the Company had drawn $280,760 on the line.
[6]	The senior debt and subordinated debt owed in relation to Providence of Sparta was refinanced into a single senior HUD note during 2017. Amortization expense related to loan costs totaled $1,246 for the three months ended March 31, 2019.
[7]	Amortization expense related to loan costs of this loan totaled $2,326 for the three months ended March 31, 2019. The Company is subject to financial covenants and customary affirmative and negative covenants, including compliance with the covenants of all other notes and bonds. As of March 31, 2019, the Company was not in compliance with some unrelated notes and bonds, which is considered to be a technical Event of Default as defined in the note agreement, but the Company believes that it is in good standing with the Lender.
[8]	Effective September 19, 2016, we executed a Modification to the mortgage note pursuant to which some accrued payments were deferred, and the lender agreed to permit interest only payments through March 2017. The mortgage loan collateralized by the GL Nursing Home is 80% guaranteed by the USDA and requires an annual renewal fee payable in the amount of 0.25% of the USDA guaranteed portion of the outstanding principal balance as of December 31 of each year. The Company is subject to financial covenants and customary affirmative and negative covenants. As of March 31, 2019, the Company was not in compliance with certain of these financial and non-financial covenants which is considered to be a technical Event of Default as defined in the note agreement. The Company is also delinquent in installment payments due under the mortgage. Remedies available to the lender in the event of a continuing Event of Default, at its option, include, but are necessarily limited to the following (1) lender may declare the principal and all accrued interest on the note due and payable; and (2) lender may exercise additional rights and remedies under the note agreement to include taking possession of the collateral or seeking satisfaction from the guarantors. The Company has been notified by the lender regarding the Events of Default. Guarantors under the mortgage loan include Christopher Brogdon. With our consent, Mr. Brogdon has assumed operations of the facility and is dealing with the lender. The Company is in negotiations with Mr. Brogdon to sell him the facility.

XML 47 R37.htm IDEA: XBRL DOCUMENT

Debt and Debt-Related Parties - Schedule of Mortgage Loan Debt (Details) (Parenthetical) - USD ($)			1 Months Ended	3 Months Ended
	May 03, 2018	Sep. 19, 2016	Apr. 30, 2018	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018	Oct. 31, 2018	Nov. 30, 2017	Oct. 31, 2017
Gain on extinguishment of debt					$ (94,925)
Warrenton Nursing Home [Member]
Amortization expense related to loan costs				2,050
Unamortized loan costs				43,681
Warrenton Nursing Home [Member] \| January 19, 2019 to January 20, 2020 [Member]
Amortization expense related to loan costs				8,885
Glen Eagle Health & Rehab [Member]
Line of credit							$ 200,365
Amortization expense related to loan costs				219
Gain on extinguishment of debt				27,794
Capitalized fees and interest			$ 22,800
Line of credit				280,760		$ 120,440
Glen Eagle Health & Rehab [Member] \| February 2019 [Member]
Line of credit				$ 400,000
Debt Instrument, maturity date				Sep. 30, 2019
Providence of Sparta Nursing Home [Member]
Amortization expense related to loan costs				$ 1,246
Meadowview Healthcare Center [Member]
Amortization expense related to loan costs				2,326
GL Nursing Home [Member]
Mortgage loan description		The mortgage loan collateralized by the GL Nursing Home is 80% guaranteed by the USDA and requires an annual renewal fee payable in the amount of 0.25% of the USDA guaranteed portion of the outstanding principal balance as of December 31 of each year.
USDA guaranteed rate		80.00%
Annual renewal fee payable		25.00%
Southern Tulsa, LLC [Member]
Debt instrument, face amount									$ 7,229,052
Line of credit									$ 1,546,801
Amount drawn under the line of credit				$ 7,105,218		$ 7,119,743
Debt instrument, interest rate								5.25%
Debt Instrument, maturity date	Oct. 30, 2018
Maturity date description	The Maturity Date was extended from April 30, 2018 to October 30, 2018. The Maturity Date was further extended to February 28, 2019 and subsequently to April 28, 2019, with the intent to convert to an amortizing loan thereafter.

XML 48 R38.htm IDEA: XBRL DOCUMENT

Debt and Debt-Related Parties - Schedule of Other Debt (Details) - Goodwill Nursing Home [Member] - Other Debt [Member] - USD ($)

3 Months Ended

Mar. 31, 2019

Dec. 31, 2018

Debt Instrument, Face Amount

$ 2,180,000

Long-term Debt, Gross

$ 1,536,000

Debt Instrument, Interest Rate Terms

^[1]

13% Fixed

Debt Instrument, maturity date

Dec. 31, 2019

[1]

XML 49 R39.htm IDEA: XBRL DOCUMENT

Debt and Debt-Related Parties - Schedule of Other Debt (Details) (Parenthetical) - Goodwill Nursing Home [Member] - Other Debt [Member]	3 Months Ended
	Mar. 31, 2019
Debt description	Investors in the Goodwill note were entitled to an additional 5% equity in Goodwill Hunting, LLC every six months if the note is not paid when due. Effective December 31, 2015, the investors holding the subordinated debt executed an Agreement Among Lenders pursuant to which they (i) agreed to waive any and all equity ratchets and (ii) agreed to extend the maturity date of the subordinated debt to June 30, 2017.
Debt reduced interest rate	13.00%
Debt Instrument, maturity date	Dec. 31, 2019
One-time premium payment, percentage	15.00%

- Definition

Identification of the lender and information about a contractual promise to repay a short-term or long-term obligation, which includes borrowings under lines of credit, notes payable, commercial paper, bonds payable, debentures, and other contractual obligations for payment. This may include rationale for entering into the arrangement, significant terms of the arrangement, which may include amount, repayment terms, priority, collateral required, debt covenants, borrowing capacity, call features, participation rights, conversion provisions, sinking-fund requirements, voting rights, basis for conversion if convertible and remarketing provisions. The description may be provided for individual debt instruments, rational groupings of debt instruments, or by debt in total.

+ References + Details

XML 50 R40.htm IDEA: XBRL DOCUMENT

Debt and Debt-Related Parties - Schedule of Future Maturities of Notes Payable (Details)

Mar. 31, 2019

USD ($)

Debt Disclosure [Abstract]

2019

$ 19,659,755

^[1]

9,013,714

5,626,986

64,013

66,541

2,671,638

Long-term Debt, Fair Value

$ 37,102,647

[1]

Any note or bond that is not in compliance with all financial and non-financial covenants is considered to have an immediate maturity, including those that require compliance with covenants on any and all other notes. The notes secured by the facilities at Meadowview and Abbeville have such covenants which were in technical non-compliance at March 31, 2019, but the Company believes that its relationships with these lenders is good.

XML 51 R41.htm IDEA: XBRL DOCUMENT

Stockholders' Equity (Details Narrative) - USD ($)	3 Months Ended		12 Months Ended
Stockholders' Equity (Details Narrative) - USD ($)	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Payments of preferred stock dividends	$ 7,500	$ 7,500
Accrued dividend	$ 7,500		$ 7,500
Share Based Compensation - Restricted Stock Awards		45,000
Weighted average exercise price for warrant	$ 0.36		$ 0.36
Options to purchase common stock	600,000		600,000
Aggregate intrinsic value of common stock options outstanding	$ 0
Directors and Executive Officers [Member]
Share Based Compensation - Restricted Stock Awards	$ 22,500	$ 45,000
Series A Convertible Redeemable Preferred Stock [Member]
Preferred stock, shares authorized	2,000,000
Preferred stock, par value	$ 2.00
Liquidation preference value	$ 2.00
Preferred stock, shares outstanding	200,500		200,500
Series D Convertible Preferred Stock [Member]
Preferred stock, shares authorized	1,000,000
Preferred stock, par value	$ 1.00
Preferred stock, shares outstanding	375,000		375,000
Preferred stock, dividend rate, percentage	8.00%
Preferred stock, call or exercise features	Shares of the Series D preferred stock are redeemable at the Company's option. At the option of the holder, shares of the Series D preferred stock plus any declared and unpaid dividends are convertible to shares of the Company's common stock at a conversion rate of $1.00 per share.
Preferred dividends declared	$ 7,500		$ 7,500
Accrued dividend	$ 7,500		$ 7,500
Preferred Stock [Member]
Preferred stock, shares authorized	10,000,000
Warrant [Member]
Outstanding warrants	2,714,918		3,142,586
Weighted average exercise price for warrant	$ 0.57		$ 0.60
Outstanding warrants, expired	427,668	71,250
Weighted average exercise price for warrant, expired	$ 0.75	$ 0.60
Aggregate intrinsic value of common stock warrants outstanding	$ 0

XML 52 R42.htm IDEA: XBRL DOCUMENT

Stockholders' Equity - Schedule of Restricted Stock Awards (Details) - Restricted Stock [Member] - shares	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Outstanding Non-Vested Restricted Stock Units, Beginning
Non-vested Restricted Stock Units Granted	272,727	562,500
Non-vested Restricted Stock Units Vested	(68,182)	(140,625)
Outstanding Non-vested Restricted Stock Units, Ending	204,545	421,875

XML 53 R43.htm IDEA: XBRL DOCUMENT

Related Parties (Details Narrative) - USD ($)	1 Months Ended			3 Months Ended		12 Months Ended
Related Parties (Details Narrative) - USD ($)	Mar. 31, 2019	May 30, 2018	Jan. 31, 2018	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Ongoing upkeep amount				$ 450
Employment Agreement [Member] \| Zvi Rhine [Member]
Recognized stock-based compensation				22,500
Base salary		$ 165,000		58,750
Raised capital value		$ 600,000
Vesting period, description		base salary of $165,000 per year (which accrues beginning January 1, 2018 but payable only after the Company raises capital of at least $600,000), (ii) 150,000 shares of restricted stock vesting one-half each on January 1, 2019 and January 1, 2020,
Options exercise price		$ 0.36
Options expiration date		Mar. 31, 2023
Employment Agreement [Member] \| Zvi Rhine [Member] \| January 1, 2019 [Member]
Number of restricted stock shares of common stock granted		150,000
Employment Agreement [Member] \| Zvi Rhine [Member] \| January 1, 2020 [Member]
Number of restricted stock shares of common stock granted		150,000
Employment Agreement [Member] \| Zvi Rhine [Member] \| April 1, 2019 [Member]
Base salary				28,029
Mr. Neuman [Member]
Stock issued for service rendered, value				93,406		$ 118,230
Directors [Member]
Vesting period			12 months
Directors [Member] \| Restricted Stock [Member]
Recognized stock-based compensation				$ 22,500	$ 45,000
Director One [Member]
Number of restricted stock shares of common stock granted	90,909
Director Two [Member]
Number of restricted stock shares of common stock granted	90,909
Director Three [Member]
Number of restricted stock shares of common stock granted	90,909

XML 54 R44.htm IDEA: XBRL DOCUMENT

Facility Leases - Schedule of Leasing Arrangements (Details)

3 Months Ended

Mar. 31, 2019

USD ($)

Middle Georgia [Member]

Monthly Lease Income

$ 60,000

^[1]

Oct. 31, 2022

None

$ 55,724

^[1]

Lease Expiration

Jun. 30, 2026

Lease Renewal Option

Term may be extended for one additional ten-year term.

Goodwill [Member]

Monthly Lease Income

$ 40,125

^[1],[2]

Lease Expiration

Feb. 01, 2027

^[2]

Lease Renewal Option

Term may be extended for one additional five-year term.

^[2]

Edwards Redeemer [Member]

Monthly Lease Income

$ 48,728

^[1]

Lease Expiration

Oct. 31, 2022

Lease Renewal Option

Term may be extended for one additional five-year term.

Providence [Member]

Monthly Lease Income

$ 42,519

^[1]

Lease Expiration

Jun. 30, 2026

Lease Renewal Option

Term may be extended for one additional ten-year term.

Meadowview [Member]

Monthly Lease Income

^[1],[3]

Lease Expiration

Oct. 31, 2023

^[3]

Lease Renewal Option

Term may be extended for one additional five-year term.

^[3]

GL Nursing [Member]

Monthly Lease Income

^[1],[4]

Lease Renewal Option

None

^[4]

Glen Eagle [Member]

Monthly Lease Income

^[1],[5]

Lease Renewal Option

None

^[5]

Southern Hills SNF [Member]

Monthly Lease Income

$ 37,000

^[1],[6]

Lease Expiration

May 31, 2019

^[6]

Lease Renewal Option

Term may be extended for one additional five-year term

^[6]

Southern Hills ALF [Member]

Monthly Lease Income

^[1],[7]

Lease Renewal Option

None

^[7]

Southern Hills ILF [Member]

Monthly Lease Income

^[1],[8]

Lease Renewal Option

None

^[8]

[1]	Monthly lease income reflects rent income on a straight-line basis over, where applicable, the term of each lease.
[2]	In January 2016, the Goodwill facility was closed by Georgia regulators and all residents were removed. In a transaction related to the sale of the Greene Point facility, an affiliate of the buyer of Greene Point executed a ten year operating lease covering Goodwill. After investing approximately $2.0 million in capital improvements in the property, the lease operator obtained all regulatory approvals and began admitting patients in December 2016. The lease became effective on February 1, 2017, and the facility began generating rental revenue thereafter.
[3]	The lease was generating $33,000 in monthly gross rent; however, the operator experienced adverse results in late 2017 and throughout 2018. In April 2018 the Company recognized a bad debt expense of $56,000 related to rent receivables previously booked in 2018 at the Meadowview facility. Effective December 1, 2018, the Company completed the operations transfer to an affiliate of Infinity Health Interests, LLC ("Infinity"). The lease is structured with a lower base rent component than the prior operator but also includes occupancy-based escalators that will better align facility operations with future rental payments.
[4]	Effective September 19, 2016, we executed a Modification to the mortgage note pursuant to which some accrued payments were deferred, and the lender agreed to permit interest only payments through March 2017. The mortgage loan collateralized by the GL Nursing Home is 80% guaranteed by the USDA and requires an annual renewal fee payable in the amount of 0.25% of the USDA guaranteed portion of the outstanding principal balance as of December 31 of each year. The Company is subject to financial covenants and customary affirmative and negative covenants. As of March 31, 2019, the Company was not in compliance with certain of these financial and non-financial covenants which is considered to be a technical Event of Default as defined in the note agreement. The Company is also delinquent in installment payments due under the mortgage. Remedies available to the lender in the event of a continuing Event of Default, at its option, include, but are necessarily limited to the following (1) lender may declare the principal and all accrued interest on the note due and payable; and (2) lender may exercise additional rights and remedies under the note agreement to include taking possession of the collateral or seeking satisfaction from the guarantors. The Company has been notified by the lender regarding the Events of Default. Guarantors under the mortgage loan include Christopher Brogdon. With our consent, Mr. Brogdon has assumed operations of the facility and is dealing with the lender. The Company is in negotiations with Mr. Brogdon to sell him the facility.
[5]	The Company entered into a management agreement with Cadence Healthcare Solutions to operate Glen Eagle after expending approximately $1.0 million in capital improvements. The facility passed its licensure survey and began admitting patients in June 2018. Effective October 12, 2018, the facility gained its certification and started collecting revenues from Medicare and Medicaid in April 2019.
[6]	Lease agreement dated May 21, 2014 with lease payments commencing February 1, 2015. On May 10, 2016, the Company obtained a Court Order appointing a Receiver to control and operate the Southern Hills SNF. The former lease operator represented that it was unable to meet the financial commitments of the facility, including the payment of rent, payroll and other operating requirements. In October 2017, the Receiver engaged a new manager for the facility at the request of the Company.
[7]	The Company plans to operate the Southern Hills ALF through a third-party manager once construction is complete and a state license is secured.
[8]	The Company plans to operate the Southern Hills ILF through a third-party manager once renovations are complete. The first residents are expected in July 2019.

XML 55 R45.htm IDEA: XBRL DOCUMENT

Facility Leases - Schedule of Leasing Arrangements (Details) (Parenthetical) - USD ($)	1 Months Ended		3 Months Ended		12 Months Ended
	Apr. 30, 2018	Dec. 31, 2016	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Payments for capital improvements			$ 962,254	$ 143,445
Goodwill [Member]
Payments for capital improvements		$ 2,000,000
Meadowview [Member]
Bad debt expenses	$ 56,000
GL Nursing [Member]
Lease term			10 years
Lease rent expense			$ 30,000
Payments to tenant			145,000
Infinity Health Interests, LLC [Member]
Monthly gross rent					$ 33,000
Cadence Healthcare Solutions [Member] \| Abbeville [Member] \| Management Agreement [Member]
Payments for capital improvements			$ 1,000,000

XML 56 R46.htm IDEA: XBRL DOCUMENT

Facility Leases - Schedule of Future Cash Payments for Rent to be Received During Initial Term of Lease (Details)	Mar. 31, 2019 USD ($)
Leases [Abstract]
2018	$ 2,345,240
2019	3,126,946
2020	3,183,242
2021	3,015,544
2022	1,922,794
2023 and Thereafter	5,120,111
Total	$ 18,713,877

XML 57 R47.htm IDEA: XBRL DOCUMENT

Fair Value Measurements - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Warrant Liability	$ 2,682	$ 2,785
Investment in Debt Securities	12,134	162,106
Fair Value	14,816	164,891
Level 1 [Member]
Warrant Liability
Investment in Debt Securities	12,134	162,106
Fair Value	12,134	162,106
Level 2 [Member]
Warrant Liability
Investment in Debt Securities
Fair Value
Level 3 [Member]
Warrant Liability	2,682	2,785
Investment in Debt Securities
Fair Value	$ 2,682	$ 2,785

XML 58 R48.htm IDEA: XBRL DOCUMENT

Fair Value Measurements - Changes in Fair Value of Company's Level 3 Valuation for Warrant Liability (Details) - Level 3 [Member] - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Beginning Balance	$ 2,785	$ 95,371
Change in Fair Value of Warrant Liability	(103)	(40,423)
Ending Balance	$ 2,682	$ 54,948

XML 59 R49.htm IDEA: XBRL DOCUMENT

Fair Value Measurements - Fair Value Measurements, Valuation Techniques (Details) - $ / shares	3 Months Ended	12 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Fair Value of Common Stock	$ 0.33	$ 0.33
Volatility [Member]
Fair value measurements valuation techniques, percent	147.43%
Volatility [Member] \| Minimum [Member]
Fair value measurements valuation techniques, percent		63.58%
Volatility [Member] \| Maximum [Member]
Fair value measurements valuation techniques, percent		91.93%
Risk Free Interest Rate [Member]
Fair value measurements valuation techniques, percent	2.44%
Risk Free Interest Rate [Member] \| Minimum [Member]
Fair value measurements valuation techniques, percent		2.36%
Risk Free Interest Rate [Member] \| Maximum [Member]
Fair value measurements valuation techniques, percent		2.59%
Exercise Price [Member]
Fair value measurements valuation techniques, exercise price	$ 1.37
Exercise Price [Member] \| Minimum [Member]
Fair value measurements valuation techniques, exercise price		$ 0.75
Exercise Price [Member] \| Maximum [Member]
Fair value measurements valuation techniques, exercise price		$ 1.37
Expected Life [Member]
Fair value measurements valuation techniques, term	5 months 27 days
Expected Life [Member] \| Minimum [Member]
Fair value measurements valuation techniques, term		5 months 12 days
Expected Life [Member] \| Maximum [Member]
Fair value measurements valuation techniques, term		11 months 26 days

XML 60 R50.htm IDEA: XBRL DOCUMENT

Segment Reporting (Details Narrative)	3 Months Ended
Segment Reporting (Details Narrative)	Mar. 31, 2019 USD ($) Number	Dec. 31, 2018 USD ($)
Number of reporting segment \| Number	2
Total Assets	$ 38,489,309	$ 38,295,887
Healthcare Services [Member]
Total Assets	561,376	145,260
Real Estate Services [Member]
Total Assets	$ 37,927,933	$ 38,150,627

XML 61 R51.htm IDEA: XBRL DOCUMENT

Segment Reporting - Schedule of Segment Reporting Information (Details) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018	Dec. 31, 2017
Total Revenue	$ 1,275,079	$ 812,065
General and Administrative	193,479	145,155
Property Taxes, Insurance and Other Operating	349,188	80,816
Depreciation	322,925	305,410
Total Expenses	865,592	531,381
Income (Loss) from Operations	409,487	280,684
Gain on Warrant Liability	(103)	(40,423)
Gain on Extinguishment of Debt		(94,925)
(Gain) Loss on Settlement of Other Liabilities		29,900
Gain on Sale of Investments	(1,069)
Gain from Insurance Claim	(270,264)
Interest Income	5,467
Interest Expense	526,235	598,366
Total Other (Income) Expense	249,332	492,918
Net Income (Loss)	160,155	(212,234)	$ 2,007,006	$ 3,001,618
Net Loss Attributable to Noncontrolling Interests	4,141	7,901
Net Income (Loss) Attributable to Global Healthcare REIT, Inc.	164,296	(204,333)
Rental Revenue [Member]
Total Revenue	895,288	812,065
Healthcare Revenue [Member]
Total Revenue	379,791
Real Estate Services [Member]
Total Revenue	895,288	812,065
General and Administrative	112,215	104,926
Property Taxes, Insurance and Other Operating	62,655	22,203
Depreciation	319,456	305,410
Total Expenses	494,326	432,539
Income (Loss) from Operations	400,962	379,526
Gain on Warrant Liability	(103)	(40,423)
Gain on Extinguishment of Debt		(94,925)
(Gain) Loss on Settlement of Other Liabilities		29,900
Gain on Sale of Investments	(1,069)
Gain from Insurance Claim	(270,264)
Interest Income	(5,467)
Interest Expense	526,235	598,366
Total Other (Income) Expense	249,332	492,918
Net Income (Loss)	151,630	(113,392)
Net Loss Attributable to Noncontrolling Interests	4,141	7,901
Net Income (Loss) Attributable to Global Healthcare REIT, Inc.	155,771	(105,491)
Real Estate Services [Member] \| Rental Revenue [Member]
Total Revenue	895,288	812,065
Real Estate Services [Member] \| Healthcare Revenue [Member]
Total Revenue
Healthcare Services [Member]
Total Revenue	379,791
General and Administrative	81,264	40,229
Property Taxes, Insurance and Other Operating	286,533	58,613
Depreciation	3,469
Total Expenses	371,266	98,842
Income (Loss) from Operations	8,525	(98,842)
Gain on Warrant Liability
Gain on Extinguishment of Debt
(Gain) Loss on Settlement of Other Liabilities
Gain on Sale of Investments
Gain from Insurance Claim
Interest Income
Interest Expense
Total Other (Income) Expense
Net Income (Loss)	8,525	(98,842)
Net Loss Attributable to Noncontrolling Interests
Net Income (Loss) Attributable to Global Healthcare REIT, Inc.	8,525	(98,842)
Healthcare Services [Member] \| Rental Revenue [Member]
Total Revenue
Healthcare Services [Member] \| Healthcare Revenue [Member]
Total Revenue	$ 379,791

XML 62 R52.htm IDEA: XBRL DOCUMENT

Subsequent Events (Details Narrative) - Subsequent Event [Member] - Restricted Common Stock [Member] - Employment Agreement [Member] - Zvi Rhine [Member]	Apr. 15, 2019 USD ($) $ / shares shares
Number of common stock shares issued for services, value \| $	$ 90,000
Shares issued price per shares \| $ / shares	$ 0.33
Number of common stock shares issued for services, shares \| shares	272,727

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