GBCS Selectis Health Inc (PK)

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-K/A-1

 

☒ ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the fiscal year ended December 31, 2023

 

☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from __________ to _________

 

Commission file number 0-15415

 

Selectis Health, 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
8480 E Orchard Rd, Ste 4900, Greenwood Village, CO		80111
(Address of principal executive offices)		(Zip Code)

 

Issuer’s telephone number: (720) 680-0808

 

Securities registered pursuant to Section 12(b) of the Act: None

 

Securities registered pursuant to Section 12(g) of the Act: Common Stock, $.05 par value

 

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act ☐ Yes ☒ No

 

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. ☐

 

Note - Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Exchange Act from their obligations under those Sections.

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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 ☐

 

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 ☐

 

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ☐

 

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
☐	☐	☐	☒

 

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

☒

 

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. ☐

 

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

 

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

 

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

 

The aggregate market value of the 2,373,701 shares of voting and non-voting common equity held by non-affiliates as of June 30, 2023 was $11,275,080 computed by reference to the price at which the common equity was last sold at June 30, 2023.

 

The number of shares outstanding of the registrant’s common stock as of April 6, 2024 is 3,067,059.

 

DOCUMENTS INCORPORATED BY REFERENCE

 

Exhibits, See Part IV

 

 

 

EXPLANATORY NOTE

 

This Amendment No.1 to the Annual Report on Form 10-K is being filed solely to furnish the updated financial information in the following sections:

 

 

 

SELECTIS HEALTH, INC.

 

TABLE OF CONTENTS

 

Item No.		Form 10-K Report Page
	Cautionary Note Regarding Forward-Looking Statements	4
	PART I
Item 1	Business	5
Item 1A	Risk Factors	15
Item 1B	Unresolved Staff Comments	16
Item 1C	Cybersecurity	16
Item 2	Properties	17
Item 3	Legal Proceedings	17
Item 4	Mine Safety Disclosures	17
	PART II
Item 5	Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities	18
Item 6	[Reserved]	18
Item 7	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
Item 7A	Quantitative and Qualitative Disclosures About Market Risk	24
Item 8	Financial Statements and Supplementary Data	24
Item 9	Changes and Disagreements with Accountants on Accounting and Financial Disclosure	24
Item 9A	Controls and Procedures	24
Item 9B	Other Information	26
Item 9C	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	26
	PART III
Item 10	Directors, Executive Officers and Corporate Governance	26
Item 11	Executive Compensation	30
Item 12	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	32
Item 13	Certain Relationships and Related Transactions, and Director Independence	33
Item 14	Principal Accounting Fees and Services	33
	PART IV
Item 15	Exhibits and Financial Statement Schedules	34
	Signatures	47

 

 

CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS

 

This Annual Report contains statements that plan for or anticipate the future. In this Annual Report, forward-looking statements are generally identified by the words “anticipate,” “plan,” “believe,” “expect,” “estimate,” and the like. These forward-looking statements include, but are not limited to, statements regarding the following:

 

*	strategic business relationships;
*	statements about our future business plans and strategies;
*	anticipated operating results and sources of future revenue;
*	our organization’s growth;
*	adequacy of our financial resources;
*	development of markets;
*	competitive pressures;
*	changing economic conditions; and,
*	expectations regarding competition from other companies.
*	the duration and scope of the COVID-19 pandemic
*	the impact of the COVID-19 pandemic on occupancy rates and on the operations of the Company’s facilities and its operators/tenants.
*	Actions governments take in response to the COVID-19 pandemic, including the introduction of public health measures and other regulations affecting our properties and our operations and the operations of our operations/tenants.
*	The effects of health and safety measures adopted by us and our operations/tenants in response to the COVID-19 pandemic.
*	Increased operational costs because of health and safety measures related to COVID-19.
*	The impact of the COVID-19 pandemic on the business and financial conditions of our operations/tenants and their ability to pay rent.
*	Disruptions to our property acquisition and disposition activities due to economic uncertainty caused by COVID-19.
*	General economic uncertainty in key markets as a result of the COVID-19 pandemic and a worsening of global economic conditions or low levels of economic growth.

 

Although we believe that any forward-looking statements, we make in this Annual Report are reasonable, because forward-looking statements involve future risks and uncertainties, there are factors that could cause actual results to differ materially from those expressed or implied. For example, a few of the uncertainties that could affect the accuracy of forward-looking statements, besides the specific factors identified above in the Risk Factors section of this Annual Report, include:

 

*	changes in general economic and business conditions affecting the healthcare industry;
*	developments that make our facilities less competitive;
*	changes in our business strategies;
*	the level of demand for our facilities; and
*	regulatory changes affecting the healthcare industry and third-party payor practices.

 

 

PART I

 

ITEM 1.

BUSINESS

 

Background

 

Selectis Health, Inc. (“Selectis” or “we” or the “Company”) owns and operates, through wholly-owned subsidiaries, Assisted Living Facilities, Independent Living Facilities, and Skilled Nursing Facilities across the South and Southeastern portions of the US. In 2019 the Company shifted from leasing long-term care facilities to third-party, independent operators towards a model where a wholly owned subsidiary would operate but is owned by another wholly owned subsidiary.

 

Prior to the Company changing its name to Selectis Health, Inc., the Company was known as Global Healthcare REIT, Inc. from September 30, 2013, to May 2021. Prior to this, 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”). WPF was merged into the Company in 2019.

 

In May 2021, the Company successfully rebranded to Selectis Health, Inc., from Global Healthcare REIT, Inc. to better align with the current and future business model, which is to own and operate its facilities.

 

We acquire, develop, lease, manage, and dispose of healthcare real estate, provide financing to healthcare providers, and provide healthcare operations through our wholly-owned subsidiaries. Our portfolio is comprised of investments in the following healthcare segments: (i) senior housing (including independent and assisted living) and (ii) post-acute/skilled nursing. We make investments within our healthcare segments using the following six strategies: (i) direct ownership of properties, (ii) debt investments, (iii) developments and redevelopments, (iv) investment management, (v) the Housing and Economic Recovery Act of 2008 (“RIDEA”), which represents investments in senior housing operations utilizing the structure permitted by RIDEA and (vi) owning healthcare operations.

 

Healthcare Industry

 

Healthcare is the single largest industry in the U.S. based on Gross Domestic Product (“GDP”). According to the National Health Expenditures report by the Centers for Medicare and Medicaid Services (“CMS”): (i) national health expenditures are expected to grow 1.2 percentage points faster than GDP per year over the 2016 – 2025 period; (ii) the average compounded annual growth rate for national health expenditures, over the projection period of 2016 through 2027, is anticipated to be 5.6%; and (iii) health spending is projected to represent 19.9% of US GDP by 2025, up from 17.8% in 2015.

 

Senior citizens are the largest consumers of healthcare services. According to CMS, on a per capita basis, the 85-year and older segment of the population spends 92% more on healthcare than the 65 to 84-year-old segment and over 329% more than the population average.

 

In the future, the Company intends to continue to search for operations that will enhance our portfolio of healthcare centers.

 

 

Real Estate Industry

 

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.

 

The Company owns 13 healthcare facilities. Initially, the Company simply owned the physical property and real estate and leased or subleased the facility to third-party operators. In 2019, the Company intentionally decided to begin moving towards operations through newly created independent operating subsidiaries. In the future, the Company intends to own and operate all future facilities. As of December 31, 2023, the Company, through wholly-owned subsidiaries, operates nine healthcare facilities.

 

Business Strategy

 

As an organization, our primary goal is to increase shareholder value through profitable growth and professional healthcare. Our investment strategy to achieve this goal is based on four principles: (i) quality healthcare for our residents, (ii) opportunistic investing, (iii) portfolio diversification and (iv) conservative financing.

 

Quality Healthcare for our Residents

 

Our healthcare operations continue to bolster our revenue. Over the last two years, our operational footprint has grown from one facility to nine. The mix of our revenues, from leasing facilities to our owner operator model has shifted drastically from rents to healthcare as well. To ensure this continues our operational teams and staff at our facilities are dedicated to maintaining the highest of standards and quality care metrics in line with, but not limited to, the CDC, ADA, CMS, and all state and local guidelines.

 

Opportunistic Investing

 

We will make investment decisions that are expected to drive profitable growth and create shareholder value. We will perform in depth due diligence and quantitative and qualitative analyses to ensure that we position ourselves to create and take advantage of situations to meet our goals and investment criteria that will continue to add to the Company’s strategic and financial value.

 

Portfolio Diversification

 

We believe in maintaining a portfolio of healthcare investments diversified by segment, geography, operator, tenant, and investment product. Diversification reduces the likelihood that a single event would materially harm our business and allows us to take advantage of opportunities in different markets based on individual market dynamics. While pursuing this strategy of diversification, we will monitor, but will not limit, our investments based on the percentage of our total assets that may be invested in any one property type, investment product, geographic location, the number of properties which we may lease to a single operator or tenant, or mortgage loans we may make to a single borrower. With investments in multiple segments and investment products, we can focus on opportunities with the most attractive risk/reward profile for the portfolio. We may structure transactions as master leases, require operator or tenant insurance and indemnifications, obtain credit enhancements in the form of guarantees, letters of credit or security deposits, and take other measures to mitigate risk.

 

Financing

 

We will strive to manage our debt-to-equity levels and maintain multiple sources of liquidity, access to capital markets and secured debt lenders, relationships with current and prospective institutional joint venture partners, and our ability to divest of assets. Our debt obligations will be primarily fixed rate with staggered maturities, which reduces the impact of rising interest rates on our operations.

 

We plan to finance our investments based on our evaluation of available sources of funding. For short-term purposes, we may arrange for short-term borrowings from banks or other sources. We may also arrange for longer-term financing through offerings of equity and debt securities, placement of mortgage debt and capital from other institutional lenders and equity investors.

 

Competition

 

Investing in real estate serving the healthcare industry is highly competitive. We will face competition from REITs, investment companies, private equity and hedge fund investors, sovereign funds, healthcare operators, lenders, developers, and other institutional investors, some of whom may have greater resources and lower costs of capital than we do. Increased competition makes it more challenging for us to identify and successfully capitalize on opportunities that meet our objectives. Our ability to compete may also be impacted by national and local economic trends, availability of investment alternatives, availability and cost of capital, construction and renovation costs, existing laws and regulations, new legislation, and population trends.

 

 

Income from our facilities is dependent on the ability of our operations and tenants to compete with other healthcare companies on a number of different levels, including: the quality of care provided, reputation, the physical appearance of a facility, price and range of services offered, alternatives for healthcare delivery, the supply of competing properties, physicians, staff, referral sources, location, the size and demographics of the population in surrounding areas, and the financial condition of our tenants and operators. Private, federal, and state payment programs as well as the effect of laws and regulations may also have a significant influence on the profitability of our tenants and operators.

 

Healthcare Segments

 

Post-acute/skilled nursing. Skilled Nursing Facilities (“SNF”) offer restorative, rehabilitative and custodial nursing care for people not requiring the more extensive and sophisticated treatment available at hospitals. Ancillary revenues and revenues from sub-acute care services are derived from providing services to residents beyond room and board and include occupational, physical, speech, respiratory and intravenous therapy, wound care, oncology treatment, brain injury care and orthopedic therapy as well as sales of pharmaceutical products and other services. Certain SNFs provide some of the foregoing services on an out-patient basis.

 

Post-acute/skilled nursing services provided by our operations and tenants in these facilities will be primarily paid for either by private sources or through the Medicare and Medicaid programs.

 

Independent Living Facilities (“ILFs”). ILFs are designed to meet the needs of seniors who choose to live in an environment surrounded by their peers with services such as housekeeping, meals and activities. These residents generally do not need assistance with activities of daily living (“ADL”), such as bathing, eating, and dressing. However, residents have the option to contract for these services.

 

Senior Housing. Senior housing facilities include assisted living facilities (“ALFs”), independent living facilities (“ILFs”) and continuing care retirement communities (“CCRCs”), which cater to different segments of the elderly population based upon their needs. Services provided by our operations or tenants in these facilities are primarily paid for by the residents directly or through private insurance and are less reliant on government reimbursement programs such as Medicaid and Medicare. Senior housing property types are further described below.

 

Assisted Living Facilities. ALFs are licensed care facilities that provide personal care services, support, and housing for those who need help with activities of daily living yet require limited medical care. The programs and services may include transportation, social activities, exercise and fitness programs, beauty or barber shop access, hobby and craft activities, community excursions, meals in a dining room setting and other activities sought by residents. These facilities are often in apartment-like buildings with private residences ranging from single rooms to large apartments. Certain ALFs may offer higher levels of personal assistance for residents with Alzheimer’s disease or other forms of dementia. Levels of personal assistance are based in part on local regulations.

 

Continuing Care Retirement Communities (“CCRCs”). CCRCs provide housing and health-related services under long-term contracts. This alternative is appealing to residents as it eliminates the need for relocating when health and medical needs change, thus allowing residents to “age in place.” Some CCRCs require a substantial entry or buy-in fee and most also charge monthly maintenance fees in exchange for a living unit, meals, and some health services. CCRCs typically require the individual to be in relatively good health and independent upon entry.

 

Investments

 

Direct Ownership. We plan to primarily generate revenue by purchasing properties and operating the facilities internally. Most of our revenue will be received from government agencies, hospice companies, managed care contracts and private pay receipts that will provide for a substantial recovery of operating expenses including but not limited to staffing, supplies, bed taxes, real estate taxes, repairs and maintenance, utilities, and insurance. For existing properties with leases in place, our rents will be received from leases under triple net leases.

 

Operating Properties. We may enter contracts with healthcare operators to manage communities that are placed in a structure permitted by the Housing and Economic Recovery Act of 2008 (commonly referred to as “RIDEA”). Additionally, as an owner operator, our local teams work to create alignment with our internal health care providers to scale operating efficiencies, and/or ancillary services to drive profitable growth.

 

Our ability to grow income from our properties depends, in part, on our ability to (i) increase revenue and other earned income by increasing occupancy levels and improving rates, (ii) manage bad debt and (iii) control operating expenses. For properties under lease, most of our leases will include contractual annual base rent escalation clauses that are either predetermined fixed increases and/or are a function of an inflation index.

 

Debt Investments. Our mezzanine loans will generally be secured by a pledge of ownership interests of an entity or entities, which directly or indirectly own properties, and are subordinate to more senior debt, including mortgages and more senior mezzanine loans. Our interest in mortgages and construction financing will typically be issued by federal, state, and/or local banks and will generally be secured by healthcare real estate.

 

 

Developments and Redevelopments. We will generally commit to development projects that are at least 50% pre-leased or when we believe that market conditions will support speculative construction. We will work closely with our local real estate service providers, including brokerage, property management, project management and construction management companies to assist us in evaluating development proposals and completing developments. Our development and redevelopment investments will likely be in the life science and medical office segments. Redevelopments are properties that require significant capital expenditures (generally more than 25% of acquisition cost or existing basis) to achieve property stabilization or to change the primary use of the properties.

 

Recent Financings

 

2021 Senior Secured Note Extension

 

On January 17, 2020, the Board of Directors agreed to increase the total offering amount and extend the period of its 2018 Offering of 11% Senior Secured Notes. The total amount of the Offering was increased to $2,500,000. Effective February 5, 2020 and March 3, 2020, the Company completed the sale of $60,000 and $100,000, respectively, of Units in the Offering. The sale of $100,000 Units on March 3, 2020 was to a related party. Effective October 31, 2020 the Company completed the exchange of $150,000 of Units in the Offering for matured Senior Unsecured Notes. No fees or commissions were paid on the sale of the Units. The proceeds were used for general working capital.

 

In July 2023, the Company renegotiated the Senior Secured Notes, originally issued in 2018. The new terms were for 11% annual interest through December 31, 2024. The warrants issued and associated with these notes were extended through the same date. All other terms remain the same.

 

Exchange of Senior Notes for Common Stock

 

In the fourth quarter of 2021 and first quarter of 2022, the Company completed the exchange of an aggregate of $795,000 in principal amount of Senior Secured Notes for 159,000 shares of Common Stock valued at $5.00 per share.

 

COVID-19 Regulation

 

We have been and may continue to be subject to federal and state laws, regulations and executive orders relating to healthcare providers’ response to the COVID-19 pandemic. While many of the regulatory requirements were temporary and expired with the end of the public health emergency in May 2023, these requirements generally may include mandatory requirements for vaccination of staff, testing of residents and/or staff, providing COVID-19 related paid leave, implementation of infection control standards and procedures, imposition of restrictions on new admissions or readmissions of residents, required screening of all persons entering a community, imposition of restrictions or limitations on who and how residents may be visited, and imposition of mandatory notification requirements to residents, families, staff, and regulatory bodies related to positive COVID-19 cases. Enhanced or additional penalties may apply for violation of such requirements.

 

Government Regulations, Licensing and Enforcement

 

Overview

 

Our operations, and tenants will typically be subject to extensive and complex federal, state and local healthcare laws and regulations relating to fraud and abuse practices, government reimbursement, licensure and certificate of need and similar laws governing the operation of healthcare facilities, and we expect that the healthcare industry, in general, will continue to face increased regulation and pressure in the areas of fraud, waste and abuse, cost control, healthcare management and provision of services, among others. These regulations are wide-ranging and can subject our tenants and our operations to civil, criminal, and administrative sanctions. Affected tenants and operators may find it increasingly difficult to comply with this complex and evolving regulatory environment because of a relative lack of guidance in many areas as certain of our healthcare properties will be subject to oversight from several government agencies and the laws may vary from one jurisdiction to another. Changes in laws and regulations and reimbursement enforcement activity and regulatory non-compliance by our tenants and operations can all have a significant effect on the financial condition of the property, which in turn may adversely impact us.

 

We will seek to mitigate the risk to us resulting from the significant healthcare regulatory risks faced by our operations and tenants by diversifying our portfolio among property types and geographical areas, diversifying our tenant and operations base to limit our exposure to any single entity, and seeking tenants and operations that are not largely dependent on Medicaid reimbursement for their revenues. In addition, we ensure in each instance that our operations have obtained all necessary licenses and permits before beginning operations and require that those operators covenant that they will comply with all applicable laws and regulations in connection with the facility operations.

 

The following is a discussion of certain laws and regulations generally applicable to our operations and tenants.

 

Fraud and Abuse Enforcement

 

There are various extremely complex federal and state laws and regulations governing healthcare providers’ relationships and arrangements and prohibiting fraudulent and abusive practices by such providers. These laws include (i) federal and state false claims acts, which, among other things, prohibit providers from filing false claims or making false statements to receive payment from Medicare, Medicaid or other federal or state healthcare programs, (ii) federal and state anti-kickback and fee-splitting statutes, including the Medicare and Medicaid anti-kickback statute, which prohibit the payment or receipt of remuneration to induce referrals or recommendations of healthcare items or services, (iii) federal and state physician self-referral laws (commonly referred to as the “Stark Law”), which generally prohibit referrals by physicians to entities with which the physician or an immediate family member has a financial relationship, (iv) the federal Civil Monetary Penalties Law, which prohibits, among other things, the knowing presentation of a false or fraudulent claim for certain healthcare services and (v) federal and state privacy laws, including the privacy and security rules contained in the Health Insurance Portability and Accountability Act of 1996, which provide for the privacy and security of personal health information. Violations of healthcare fraud and abuse laws carry civil, criminal, and administrative sanctions, including punitive sanctions, monetary penalties, imprisonment, denial of Medicare and Medicaid reimbursement and potential exclusion from Medicare, Medicaid or other federal or state healthcare programs. These laws are enforced by a variety of federal, state, and local agencies and can also be enforced by private litigants through, among other things, federal and state false claims acts, which allow private litigants to bring qui tam or “whistleblower” actions. Many of our operations and tenants are subject to these laws, and some of them may in the future become the subject of governmental enforcement actions if they fail to comply with applicable laws.

 

 

Healthcare Licensure and Certificate of Need

 

Certain healthcare facilities in our portfolio will be subject to extensive federal, state, and local licensure, certification and inspection laws and regulations. In addition, various licenses and permits are required to dispense narcotics, operate pharmacies, handle radioactive materials, and operate equipment. Many states require certain healthcare providers to obtain a certificate of need, which requires prior approval for the construction, expansion, and closure of certain healthcare facilities. The approval process related to state certificate of need laws may impact some of our tenants’ and our ability to expand or operative effectively.

 

Americans with Disabilities Act (the “ADA”)

 

Our properties must comply with the ADA and any similar state or local laws to the extent that such properties are “public accommodations” as defined in those statutes. The ADA may require removal of barriers to access by persons with disabilities in certain public areas of our properties where such removal is readily achievable. To date, we have not received any notices of noncompliance with the ADA that have caused us to incur substantial capital expenditures to address ADA concerns. Should barriers to access by persons with disabilities be discovered at any of our properties, we may be directly or indirectly responsible for additional costs that may be required to make facilities ADA-compliant. Noncompliance with the ADA could result in the imposition of fines or an award of damages to private litigants. The obligation to make readily achievable accommodations pursuant to the ADA is an ongoing one, and we continue to assess our properties and make modifications as appropriate in this respect.

 

Environmental Matters

 

A wide variety of federal, state, and local environmental and occupational health and safety laws and regulations affect healthcare facility operations. These complex federal and state statutes, and their enforcement, involve a myriad of regulations, many of which involve strict liability on the part of the potential offender. Some of these federal and state statutes may directly impact us. Under various federal, state, and local environmental laws, ordinances and regulations, an owner of real property or a secured lender, such as us, may be liable for the costs of removal or remediation of hazardous or toxic substances at, under or disposed of in connection with such property, as well as other potential costs relating to hazardous or toxic substances (including government fines and damages for injuries to persons and adjacent property). The cost of any required remediation, removal, fines or personal or property damages and the owner’s or secured lender’s liability therefore could exceed or impair the value of the property, and/or the assets of the owner or secured lender. In addition, the presence of such substances, or the failure to properly dispose of or remediate such substances, may adversely affect the owner’s ability to sell or rent such property or to borrow using such property as collateral which, in turn, could reduce our revenues.

 

Taxation

 

Federal Income Tax Considerations

 

The following summary of the taxation of the Company and the material federal tax consequences to the holders of our debt and equity securities is for general information only and is not tax advice. This summary does not address all aspects of taxation that may be relevant to certain types of holders of stock or securities (including, but not limited to, insurance companies, tax-exempt entities, financial institutions or broker-dealers, persons holding shares of common stock as part of a hedging, integrated conversion, or constructive sale transaction or a straddle, traders in securities that use a mark-to-market method of accounting for their securities, investors in pass-through entities and foreign corporations and persons who are not citizens or residents of the United States).

 

 

This summary does not discuss all the aspects of U.S. federal income taxation that may be relevant to you considering your particular investment or other circumstances. In addition, this summary does not discuss any state or local income taxation or foreign income taxation or other tax consequences. This summary is based on current U.S. federal income tax law. Subsequent developments in U.S. federal income tax law, including changes in law or differing interpretations, which may be applied retroactively, could have a material effect on the U.S. federal income tax consequences of purchasing, owning, and disposing of our securities as set forth in this summary. Before you purchase our securities, you should consult your own tax advisor regarding the U.S. federal, state, local, foreign, and other tax consequences of acquiring, owning, and selling our securities.

 

On March 30, 2010, the President signed into law the Health Care and Education Reconciliation Act of 2010, which requires U.S. stockholders who meet certain requirements and are individuals, estates, or certain trusts to pay an additional 3.8% tax on, among other things, dividends on and capital gains from the sale or other disposition of stock for taxable years beginning after December 31, 2012. U.S. stockholders should consult their tax advisors regarding the effect, if any, of this legislation on their ownership and disposition of shares of our stock.

 

Health Care Regulatory Climate

 

Government Regulation and Reimbursement

 

The healthcare industry is heavily regulated. Our operations are subject to extensive and complex federal, state and local healthcare laws and regulations. These laws and regulations are subject to frequent and substantial changes resulting from the adoption of new legislation, rules and regulations, and administrative and judicial interpretations of existing law. The ultimate timing or effect of these changes, which may be applied retroactively, cannot be predicted. Changes in laws and regulations impacting our operations, in addition to regulatory non-compliance by our operations, can have a significant effect on the operations and financial condition of our operations, which in turn may adversely impact us. There is the potential that we may be subject directly to healthcare laws and regulations because of the broad nature of some of these regulations, such as the Anti-kickback Statute and False Claims Act, among others.

 

The U.S. Department of Health and Human Services (“HHS”) declared a public health emergency on January 31, 2020 following the World Health Organization’s decision to declare COVID-19 a public health emergency of international concern. This declaration, which has been extended through April 14, 2022, allows HHS to provide temporary regulatory waivers and new reimbursement rules designed to equip providers with flexibility to respond to the COVID-19 pandemic by suspending various Medicare patient coverage criteria and documentation and care requirements, including, for example, suspension of the three-day prior hospital stay coverage requirement and expanding the list of approved services which may be provided via telehealth. These regulatory actions have contributed, and may continue to contribute, to a change in census volumes and skilled nursing mix that may not otherwise have occurred. It remains uncertain when federal and state regulators will resume enforcement of those regulations which are waived or otherwise not being enforced during the public health emergency due to the exercise of enforcement discretion.

 

These temporary changes to regulations and reimbursement, as well as emergency legislation, including the CARES Act enacted on March 27, 2020 and discussed below, continue to have a significant impact on our operations and financial condition. The extent of the COVID-19 pandemic’s effect on the Company’s operational and financial performance will depend on future developments, including the sufficiency and timeliness of additional governmental relief, the duration, spread and intensity of the outbreak, the impact of genetic mutations of the virus into new variants, the impact of vaccine distributions and booster doses on our operations and their populations, the impact of vaccine mandates on staffing shortages at our operations, as well as the difference in how the pandemic may impact SNFs in contrast to ALFs, all of which developments and impacts are uncertain and difficult to predict. Due to these uncertainties, we are not able at this time to estimate the effect of these factors on our business; however, the adverse impact on our business, results of operations, financial condition and cash flows could be material.

 

A significant portion of our revenue is derived from government-funded reimbursement programs, consisting primarily of Medicare and Medicaid. As federal and state governments continue to focus on healthcare reform initiatives, efforts to reduce costs by government payors will likely continue. Significant limits on the scope of services reimbursed and/or reductions of reimbursement rates could therefore have a material adverse effect on our results of operations and financial condition. Additionally, new and evolving payor and provider programs that are tied to quality and efficiency could adversely impact our liquidity, financial condition or results of operations, and there can be no assurance that payments under any of these government healthcare programs are currently, or will be in the future, sufficient to fully reimburse us for our operating and capital expenses. In addition to quality and value based reimbursement reforms, the U.S. Centers for Medicare and Medicaid Services (“CMS”) has implemented a number of initiatives focused on the reporting of certain facility specific quality of care indicators that could affect our operations, including publicly released quality ratings for all of the nursing homes that participate in Medicare or Medicaid under the CMS “Five Star Quality Rating System.” Facility rankings, ranging from five stars (“much above average”) to one star (“much below average”) are updated on a monthly basis. SNFs are required to provide information for the CMS Nursing Home Compare website regarding staffing and quality measures. These rating changes have impacted referrals to SNFs, and it is possible that changes to this system or other ranking systems could lead to future reimbursement policies that reward or penalize facilities on the basis of the reported quality of care parameters.

 

 

The following is a discussion of certain U.S. laws and regulations generally applicable to our operations.

 

Reimbursement Changes Related to COVID-19:

 

U.S. Federal Stimulus Funds and Financial Assistance for Healthcare Providers. In response to the pandemic, Congress has enacted a series of economic stimulus and relief measures. On March 18, 2020, the Families First Coronavirus Response Act (“FFCRA”) was enacted in the U.S., providing a temporary 6.2% increase to each qualifying state and territory’s Medicaid Federal Medical Assistance Percentage (“FMAP”) effective January 1, 2020. The temporary FMAP increase was set to extend through the last day of the calendar quarter in which the public health emergency terminates. In exchange for receiving the enhanced federal funding, the FFCRA included a requirement that Medicaid programs keep beneficiaries enrolled through the end of the month in which the public health emergency terminates. However, as part of the Consolidated Appropriations Act of 2023 signed into law on December 29, 2022, Congress decoupled the Medicaid continuous enrollment from the public health emergency and terminates this provision effective March 31, 2023. Additionally, starting April 1, 2023, states that comply with federal rules regarding conducting renewals may begin the phase-down of the enhanced federal funding according to the following schedule: 6.2 percentage points through March 2023; 5 percentage points through June 2023; 2.5 percentage points through September 2023 and 1.5 percentage points through December 2023. States cannot restrict eligibility standards, methodologies, and procedures and states cannot increase premiums as required in FFCRA. Primarily due to the continuous enrollment provision, Medicaid enrollment has grown substantially compared to before the pandemic and the uninsured rate has dropped. The extent to which this increase in Medicaid enrollment is sustained following the discontinuation of the continuous enrollment provision is uncertain.

 

In further response to the pandemic, the CARES Act authorized approximately $178 billion to be distributed through the Provider Relief Fund to reimburse eligible healthcare providers for healthcare related expenses or lost revenues that were attributable to coronavirus. Funds have been allocated since 2020 in targeted and general distributions, the latter over four phases. In September 2021, HHS announced the release of $25.5 billion in phase four provider funding, including $17 billion of the $178 billion previously authorized through the CARES Act and $8.5 billion for rural providers, including those with Medicaid and Medicare patients, through the American Rescue Plan Act, with payments that began in December 2021. The Provider Relief Fund is administered under the broad authority and discretion of HHS and recipients are not required to repay distributions received to the extent they are used in compliance with applicable requirements. HHS continues to evaluate and provide allocations of, and issue regulation and guidance regarding, grants made under the CARES Act. We do not expect our operators will receive additional funding from HHS.

 

The CARES Act and related legislation also made other forms of financial assistance available to healthcare providers, which have the potential to impact our operators to varying degrees. This assistance includes Medicare and Medicaid payment adjustments and an expansion of the Medicare Accelerated and Advance Payment Program, which made available accelerated payments of Medicare funds in order to increase cash flow to providers. These payments are loans that providers were scheduled to repay beginning one year from the issuance date of each provider’s or supplier’s accelerated or advance payment, with repayment made through automatic recoupment of 25% of Medicare payments otherwise owed to the provider or supplier for eleven months, followed by an increase to 50% for another six months, after which any outstanding balance would be repaid subject to an interest rate of 4%. We believe these repayments commenced for many of our operators in April 2021 and have adversely impacted operating cash flows of these operators. While not limited to healthcare providers, the CARES Act additionally provided payroll tax relief for employers, allowing them to defer payment of employer Social Security taxes that are otherwise owed for wage payments made after March 27, 2020 through December 31, 2020 to December 31, 2021 with respect to 50% of the payroll taxes owed, with the remaining 50% deferred until December 31, 2022.

 

The Budget Control Act of 2011 established a Medicare Sequestration of 2%, which is an automatic reduction of certain federal spending as a budget enforcement tool. Originally, the sequester was supposed to be in effect from FY 2013 to FY 2021. However, most recently, the Infrastructure Investment and Jobs Act extended the sequester through FY 2031. Additional legislation, including the CARES Act and the Protecting Medicare and American Farmers Act, suspended the application of the sequester to Medicare from May 1, 2020 through March 30, 2022. It also limited Medicare reductions to 1% from April 1, 2022 through June 30, 2022. The full 2% Medicare sequestration went into effect as of July 1, 2022. The sequestration is currently extended through fiscal year 2031, and gradually increases to 4% from 2030 through 2031.

 

Quality of Care Initiatives and Additional Requirements Related to COVID-19. In addition to COVID-19 reimbursement changes, several regulatory initiatives announced from 2020 to 2022 focused on addressing quality of care in long-term care facilities, including those related to COVID-19 testing and infection control protocols, vaccine protocols, staffing levels, reporting requirements, and visitation policies, as well as increased inspection of nursing homes. In August 2021, CMS announced it was developing an emergency regulation requiring staff vaccinations within the nation’s more than 15,000 Medicare and Medicaid-participating nursing homes, and in September 2021, CMS further announced that the scope of the regulation would be expanded to include workers in hospitals, dialysis facilities, ambulatory surgical settings, and home health agencies. In addition, recent updates to the Nursing Home Care website and the Five Star Quality Rating System include revisions to the inspection process, adjustment of staffing rating thresholds, the implementation of new quality measures and the inclusion of a staff turnover percentage (over a 12-month period). Although the American Rescue Plan Act did not allocate specific funds directly to SNF or ALF providers, certain funds were allocated to states who then distributed a portion of these funds to SNF and ALF providers. In addition, the American Rescue Plan Act allocated funds to quality improvement organizations to provide infection control and vaccination uptake support to SNFs and to the CDC for staffing, training and deployment of state-based nursing home and long-term care “strike teams” to assist facilities with known or suspected COVID-19 outbreaks. Additionally, the Biden Administration announced a focus on implementing minimum staffing requirements and increased inspections as part of the nursing home reforms announced in the 2022 State of the Union Address, and in July 2022, CMS announced it was evaluating a proposed federal staffing mandate for SNFs. It is uncertain whether such a mandate will be implemented and, if it is, whether it will be accompanied by additional funding to offset any increased staffing requirements for our operators; an unfunded mandate to increase staff in SNFs may have a material and adverse impact on the financial condition of our operators.

 

On June 16, 2020, the U.S. House of Representatives Select Subcommittee on the Coronavirus Crisis announced the launch of an investigation into the COVID-19 response of nursing homes and the use of federal funds by nursing homes during the pandemic. The Select Subcommittee continued to be active throughout the remainder of 2020, 2021 and 2022. In March 2021, the Oversight Subcommittee of the House Ways and Means Committee held a hearing on examining the impact of private equity in the U.S. healthcare system, including the impact on quality of care provided within the skilled nursing industry. The Biden Administration additionally announced in March 2022 a focus on reviewing private equity investment specifically in the skilled nursing sector. These initiatives, as well as additional calls for government review of the role of private equity in the U.S. healthcare industry, could result in additional requirements on our operators.

 

 

Reimbursement Generally:

 

Medicaid. Most of our SNF operators derive a substantial portion of their revenue from state Medicaid programs. Whether and to what extent the level of Medicaid reimbursement covers the actual cost to care for a Medicaid eligible resident varies by state. While periodic rate setting occurs and, in most cases, has an inflationary component, the state rate setting process not always keep pace with inflation or, even if it does, there is a risk that is may still not be sufficient to cover all or a substantial portion of the cost to care for Medicaid eligible residents. Additionally, rate setting is also subject to changes based on state budgetary constraints and political factors, both of which could result in decreased or insufficient reimbursement to the industry even in an environment where costs are rising. Since our operators’ profit margins on Medicaid patients are generally relatively low, more than modest reductions in Medicaid reimbursement or an increase in the percentage of Medicaid patients has in the past, and may in the future, adversely affect our operators’ results of operations and financial condition, which in turn could adversely impact us.

 

The CARES Act and American Rescue Plan Act contained several provisions designed to increase coverage, expand benefits, and adjust federal financing for state Medicaid programs. While the CARES Act provided for a 6.2% FMAP add-on to the Medicaid program during the PHE, only certain states passed any of that specifically on to SNF operators either via an enhanced rate or lump sum payments. Additionally, the American Rescue Plan Act provided for a 10% FMAP add-on for state home and community-based service expenditures from April 1, 2021 through March 30, 2022 in an effort to assist seniors and people with disabilities to receive services safely in the community rather than in nursing homes and other congregate care settings. Both of these programs came with conditions that states had to meet to eligible for the FMAP add-on. There may be future initiatives proposed to allocate funding available for reimbursement away from SNFs in favor of home health agencies and community-based care.

 

The risks of insufficient Medicaid reimbursement rates along with possible initiatives to push residents historically cared for in SNFs to alternative settings may impact us more acutely in states where we have a larger presence. We continue to monitor rate adjustment activity in other states in which we have a meaningful presence, and it is too early to assess whether rates will generally keep pace with increased operator costs.

 

Medicare. On July 29, 2022, CMS issued a final rule regarding the government fiscal year 2023 Medicare payment rates and quality payment programs for SNFs, with aggregate Medicare Part A payments projected to increase by $904 million, or 2.7%, for fiscal year 2023 compared to fiscal year 2022. This estimated reimbursement increase is attributable to a 3.9% market basket increase factor plus a 1.5 percentage point market basket forecast error adjustment and less a 0.3 percentage point productivity adjustment, as well as a $780 million decrease in the SNF prospective payment system rates as a result of the recalibrated parity adjustment described below, which is being phased in over two years. The annual update is reduced by two percentage points for SNFs that fail to submit required quality data to CMS under the SNF Quality Reporting Program. CMS has indicated that these impact figures did not incorporate the SNF Value-Based Program reductions that are estimated to be $186 million in fiscal year 2023. While Medicare reimbursement rate setting, which takes effect annually each October, has historically included forecasted inflationary adjustments, the degree to which those forecasts accurately reflect current inflation rates remains uncertain. Additionally, it remains uncertain whether these adjustments will ultimately be offset by non-inflationary factors, including any adjustments related to the impact of various payment models, such as those described below.

 

Payments to providers continue to be increasingly tied to quality and efficiency. The Patient Driven Payment Model (“PDPM”), which was designed by CMS to improve the incentives to treat the needs of the whole patient, became effective October 1, 2019. CMS has stated that it intended PDPM to be revenue-neutral to operators, with future Medicare reimbursement reductions possible if that was not the case. In April 2022, CMS issued a proposal for comment, which included an adjustment to obtain that revenue neutrality as early as the 2023 rate setting period. After considering the feedback received in the rulemaking cycle, CMS finalized recalibration of the PDPM parity adjustment factor of 4.6% with a two-year phase-in period that would reduce SNF spending by 2.3%, or approximately $780 million, in each of fiscal years 2023 and 2024. Prior to COVID-19, we believed that certain of our operators could realize efficiencies and cost savings from increased concurrent and group therapy under PDPM and some had reported early positive results. Given the ongoing impacts of COVID-19, many operators are and may continue to be restricted from pursuing concurrent and group therapy and unable to realize these benefits. Additionally, our operators continue to adapt to the reimbursement changes and other payment reforms resulting from the value-based purchasing programs applicable to SNFs under the 2014 Protecting Access to Medicare Act. These reimbursement changes have had and may, together with any further reimbursement changes to PDPM or value-based purchasing models, in the future have an adverse effect on the operations and financial condition of some operators and could adversely impact the ability of operators to meet their obligations to us.

 

On May 27, 2020, CMS added physical therapy, occupational therapy and speech-language pathology to the list of approved telehealth Providers for the Medicare Part B programs provided by a SNF as a part of the COVID-19 1135 waiver provisions. The COVID-19 1135 waiver provisions also allow for the facility to bill an originating site fee to CMS for telehealth services provided to Medicare Part B beneficiary residents of the facility when the services are provided by a physician from an alternate location, effective March 6, 2020 through May 11, 2023, the scheduled end of the public health emergency.

 

Other Regulation:

 

Office of the Inspector General Activities. The Office of Inspector General (“OIG”) of HHS has provided long-standing guidance for SNFs regarding compliance with federal fraud and abuse laws. More recently, the OIG has conducted increased oversight activities and issued additional guidance regarding its findings related to identified problems with the quality of care and the reporting and investigation of potential abuse or neglect at group homes, nursing homes and SNFs. The OIG has additionally reviewed the staffing levels reported by SNFs as part of its August 2018 and February 2019 Work Plan updates and included a review of involuntary transfers and discharges from nursing homes in the June 2019 Work Plan updates. In August 2020, the OIG released its findings regarding its review of staffing levels in SNFs from 2018. The OIG recommended that CMS enhance efforts to ensure nursing homes meet daily staffing requirements and explore ways to provide consumers with additional information on nursing homes’ daily staffing levels and variability. The OIG indicated that while the review was initiated before the COVID-19 pandemic emerged, the pandemic reinforces the importance of sufficient staffing for nursing homes, as inadequate staffing can make it more difficult for nursing homes to respond to infectious disease outbreaks like COVID-19. It is unknown what impact, if any, enhanced scrutiny of staffing levels by OIG and CMS will have on our operators.

 

 

Department of Justice and Other Enforcement Actions. SNFs are under intense scrutiny for ensuring the quality of care being rendered to residents and appropriate billing practices conducted by the facility. The Department of Justice (“DOJ”) has historically used the False Claims Act to civilly pursue nursing homes that bill the federal government for services not rendered or care that is grossly substandard. For example, California prosecutors announced in March 2021 an investigation into a skilled nursing provider that is affiliated with one of our operators, alleging the chain manipulated the submission of staffing level data in order to improve its Five Star rating. In 2020, the DOJ launched a National Nursing Home Initiative to coordinate and enhance civil and criminal enforcement actions against nursing homes with grossly substandard deficiencies. Such enforcement activities are unpredictable and may develop over lengthy periods of time. An adverse resolution of any of these enforcement activities or investigations incurred by our operators may involve injunctive relief and/or substantial monetary penalties, either or both of which could have a material adverse effect on their reputation, business, results of operations and cash flows.

 

Medicare and Medicaid Program Audits. Governmental agencies and their agents, such as the Medicare Administrative Contractors, fiscal intermediaries and carriers, as well as the OIG, CMS and state Medicaid programs, conduct audits of our operators’ billing practices from time to time. CMS contracts with Recovery Audit Contractors on a contingency basis to conduct post-payment reviews to detect and correct improper payments in the fee-for-service Medicare program, to managed Medicare plans and in the Medicaid program. Regional Recovery Audit Contractor program auditors along with the OIG and DOJ are expected to continue their efforts to evaluate SNF Medicare claims for any excessive therapy charges. CMS also employs Medicaid Integrity Contractors to perform post-payment audits of Medicaid claims and identify overpayments. In addition, the state Medicaid agencies and other contractors have increased their review activities. To the extent any of our operators are found out of compliance with any of these laws, regulations or programs, their financial position and results of operations can be adversely impacted, which in turn could adversely impact us.

 

Fraud and Abuse. There are various federal and state civil and criminal laws and regulations governing a wide array of healthcare provider referrals, relationships and arrangements, including laws and regulations prohibiting fraud by healthcare providers. Many of these complex laws raise issues that have not been clearly interpreted by the relevant governmental authorities and courts.

 

These laws include: (i) federal and state false claims acts, which, among other things, prohibit providers from filing false claims or making false statements to receive payment from Medicare, Medicaid or other federal or state healthcare programs; (ii) federal and state anti-kickback and fee-splitting statutes, including the Medicare and Medicaid Anti-kickback statute, which prohibit the payment or receipt of remuneration to induce referrals or recommendations of healthcare items or services, such as services provided in a SNF; (iii) federal and state physician self-referral laws (commonly referred to as the Stark Law), which generally prohibit referrals by physicians to entities for designated health services (some of which are provided in SNFs) with which the physician or an immediate family member has a financial relationship; (iv) the federal Civil Monetary Penalties Law, which prohibits, among other things, the knowing presentation of a false or fraudulent claim for certain healthcare services and (v) federal and state privacy laws, including the privacy and security rules contained in the Health Insurance Portability and Accountability Act of 1996, which provide for the privacy and security of personal health information.

 

Violations of healthcare fraud and abuse laws carry civil, criminal and administrative sanctions, including punitive sanctions, monetary penalties, imprisonment, denial of Medicare and Medicaid reimbursement and potential exclusion from Medicare, Medicaid or other federal or state healthcare programs. Additionally, there are criminal provisions that prohibit filing false claims or making false statements to receive payment or certification under Medicare and Medicaid, as well as failing to refund overpayments or improper payments. Violation of the Anti-kickback statute or Stark Law may form the basis for a federal False Claims Act violation. These laws are enforced by a variety of federal, state and local agencies and can also be enforced by private litigants through, among other things, federal and state false claims acts, which allow private litigants to bring qui tam or whistleblower actions, which have become more frequent in recent years.

 

Privacy:

 

We and our operators are subject to various federal, state and local laws and regulations designed to protect the confidentiality and security of patient health information, including the federal Health Insurance Portability and Accountability Act of 1996, as amended, the Health Information Technology for Economic and Clinical Health Act (“HITECH”), and the corresponding regulations promulgated thereunder (collectively referred to herein as “HIPAA”). The HITECH Act expanded the scope of these provisions by mandating individual notification in instances of breaches of protected health information, providing enhanced penalties for HIPAA violations, and granting enforcement authority to states’ Attorneys General in addition to the HHS Office for Civil Rights (“OCR”). Additionally, in a final rule issued in January 2013, HHS modified the standard for determining whether a breach has occurred by creating a presumption that any non-permitted acquisition, access, use or disclosure of protected health information is a breach unless the covered entity or business associate can demonstrate through a risk assessment that there is a low probability that the information has been compromised.

 

Various states have similar laws and regulations that govern the maintenance and safeguarding of patient records, charts and other information generated in connection with the provision of professional medical services. These laws and regulations require our operators to expend the requisite resources to secure protected health information, including the funding of costs associated with technology upgrades. Operators found in violation of HIPAA or any other privacy law or regulation may face significant monetary penalties. In addition, compliance with an operator’s notification requirements in the event of a breach of unsecured protected health information could cause reputational harm to an operator’s business.

 

Licensing and Certification. Our operators and facilities are subject to various federal, state and local licensing and certification laws and regulations, including laws and regulations under Medicare and Medicaid requiring operators of SNFs and ALFs to comply with extensive standards governing operations. Governmental agencies administering these laws and regulations regularly inspect our operators’ facilities and investigate complaints. Our operators and their managers receive notices of observed violations and deficiencies from time to time, and sanctions have been imposed from time to time on facilities operated by them. In addition, many states require certain healthcare providers to obtain a certificate of need, which requires prior approval for the construction, expansion or closure of certain healthcare facilities, which has the potential to impact some of our operators’ abilities to expand or change their businesses.

 

 

Other Laws and Regulations. Additional federal, state and local laws and regulations affect how we conduct our operations, including laws and regulations protecting consumers against deceptive practices and otherwise generally affecting our operators’ management of their property and equipment and the conduct of their operations (including laws and regulations involving fire, health and safety; the Americans with Disabilities Act (the “ADA”), which imposes certain requirements to make facilities accessible to persons with disabilities, the costs for which we may be directly or indirectly responsible; the U.S. Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010 (collectively referred to as the “Healthcare Reform Law”), which amended requirements for staff training, discharge planning, infection prevention and control programs, and pharmacy services, among others; staffing; quality of services, including care and food service; residents’ rights, including abuse and neglect laws; and health standards, including those set by the federal Occupational Safety and Health Administration (in the U.S.). It is anticipated that our operators will continue to face additional federal and state regulatory requirements related to the operation of their facilities in response to the COVID-19 pandemic. These requirements may continue to evolve and develop over lengthy periods of time.

 

General and Professional Liability. Although arbitration agreements have been effective in limiting general and professional liabilities for SNF and long-term care providers, there have been numerous lawsuits in recent years challenging the validity of arbitration agreements in long-term care settings. On July 16, 2019, CMS issued a final rule lifting the prohibition on pre-dispute arbitration agreements offered to residents at the time of admission provided that certain requirements are met. The rule prohibits providers from requiring residents to sign binding arbitration agreements as a condition for receiving care and requires that the agreements specifically grant residents the explicit right to rescind the agreement within thirty calendar days of signing. A number of professional liability and employment related claims have been filed or are threatened to be filed against long-term care providers related to COVID-19. While such claims may be subject to liability protection provisions within various state executive orders or legislation and/or federal legislation, an adverse resolution of any of legal proceeding or investigations against our operators may involve injunctive relief and/or substantial monetary penalties, either or both of which could have a material adverse effect on our operators’ reputation, business, results of operations and cash flows.

 

Environmental, Social and Governance (“ESG”)

 

We prioritize environmental, social and governance initiatives that matter most to our business and shareholders. Our Nominating and Corporate Governance Committee of our Board of Directors has been charged with primary oversight of our sustainability efforts.

 

As a triple-net landlord at two of our facilities, our third-party operators maintain operational control and responsibility for our real estate on a day-to-day basis. While our ability to mandate environmental changes to their operations is limited, our tenants are contractually bound to preserve and maintain our properties in good working order and condition. In connection with this, they are required to meet or exceed annual expenditure thresholds on capital improvements and enhancements of our properties, which in some cases may facilitate improvements in the environmental performance of our properties and reduces energy usage, water usage, and direct and indirect greenhouse gas emissions. The goal is to incentivize operators to invest in sustainable capital projects that provide a favorable return on investment while reducing the environmental footprint of these operations. Our due diligence on real estate acquisitions generally includes environmental assessments as part of our analysis to understand the environmental condition of the property, and to determine whether the property meets certain environmental standards. Similarly, during the due diligence process, we seek to evaluate the risk of physical, natural disaster or extreme weather patterns on the properties we are looking to acquire and to assess their compliance with building codes, which often results in remediations that incorporate sustainable improvements into our properties.

 

We are committed to providing a positive and engaging work environment for our employees and taking an active role in the betterment of the communities in which our employees live and work. See also “Human Capital Management” immediately below.

 

Human Capital Management

 

Our success is based on the focused passion and dedication of our people. We believe our employees’ commitment to our Company provides better service to our tenants and stakeholders, supports an inclusive and collegial working environment and generates long-term value for our shareholders and the communities which we serve. As of March 4, 2024 we had 574 employees including the executive officers listed below, none of whom is subject to a collective bargaining agreement. Due to the size and nature of our business, our future performance depends to a significant degree upon the continued contributions of our executive management team and other key employees. As such, the ability to attract, develop and retain qualified personnel will continue to be important to the Company’s long-term success.

 

We are committed to providing a positive and engaging work environment for our employees and taking an active role in the betterment of the communities in which our employees live and work. Our full-time employees are provided a competitive benefits program, the opportunity to participate in our employee stock purchase program, bonus and incentive pay opportunities, competitive paid time-off benefits and paid parental leave, wellness programs, continuing education and development opportunities, and periodic engagement surveys. In addition, we believe that giving back to our community is an extension of our mission to improve the lives of our stockholders, our employees, and their families.

 

EMPLOYEES

 

As of December 31, 2023, the Company and its subsidiaries had 574 employees. The Company also engages the services of consultants from time to time, some of which may be provided by affiliates of the Company at no cost.

 

 

ITEM 1A.

RISK FACTORS

 

The COVID-19 pandemic has subjected our business, operations, and financial condition to several risks, including, but not limited to, those discussed below:

 

●	Risks Related to Revenue: The revenues from our operations and from our tenants are dependent on occupancy. All facilities must maintain a minimum viable resident count to ensure costs do not exceed revenues. In addition to the impact of increases in mortality rates on occupancy of our operating facilities, the ongoing COVID-19 pandemic has prevented prospective occupants and their families from visiting our facilities and limited the ability of new occupants to move into our facilities due to heightened move-in criteria and screening. Although the ongoing impact of the pandemic on occupancy remain uncertain, occupancy of our operating and triple-net properties could further decrease. Such a decrease could affect the net operating income of our operating properties and the ability of our triple-net operators to make contractual payments to us.
●	Risks Related to Operator and Tenant Financial Condition: In addition to the risk of decreased revenue from tenant and operator payments, the impact of the COVID-19 pandemic creates a heightened risk of tenant and operator, bankruptcy, or insolvency due to factors such as decreased occupancy, medical practice disruptions resulting from stay-at-home orders, increased health and safety and labor expenses or litigation resulting from developments related to the COVID-19 pandemic. Although our operating lease agreements provide us with the right to evict a tenant, demand immediate payment of rent and exercise other remedies, the bankruptcy and insolvency laws afford certain rights to a party that has filed for bankruptcy or reorganization. A tenant, operator, in bankruptcy or subject to insolvency proceedings may be able to limit or delay our ability to collect unpaid rent in the case of a lease. In addition, if a lease is rejected in a tenant bankruptcy, our claim against the tenant may be limited by applicable provisions of the bankruptcy law. We may be required to fund certain expenses (e.g., real estate taxes and maintenance) to preserve the value of an investment property, avoid the imposition of liens on a property and/or transition a property to a new tenant. In some past instances, we have terminated our lease with a tenant and relet the property to another tenant; however, our ability to do so may be severely limited under current conditions due to the industry and macroeconomic effects of the COVID-19 pandemic. If we cannot transition a leased property to a new tenant because of the COVID-19 pandemic or for other reasons, we may take possession of that property, which may expose us to certain successor liabilities. Publicity about the operator’s financial condition and insolvency proceedings, particularly considering ongoing publicity related to the COVID-19 pandemic, may also negatively impact their and our reputations, decreasing customer demand and revenues. Should such events occur, our revenue and operating cash flow may be adversely affected.

 

 

●	Risks Related to Operations: Across all of our properties, our operations and our tenants have incurred increased operational costs as a result of the introduction of public health measures and other regulations affecting our properties and our operations, as well additional health and safety measures adopted by us related to the COVID-19 pandemic, including increases in labor and property cleaning expenses and expenditures related to our efforts to procure PPE and supplies. Such operational costs may increase in the future based on the duration and severity of the pandemic or the introduction of additional public health regulations. Operators and tenants are also subject to risks arising from the unique pressures on seniors housing and medical practice employees during the COVID-19 pandemic. As a result of difficult conditions and stresses related to the COVID-19 pandemic, employee morale and productivity may suffer and additional pay, such as hazard pay, may not be sufficient to retain key operator and tenant employees. In addition, our operations may be adversely impacted if a significant number of our employees’ contract COVID-19. Although we continue to undertake extensive efforts to ensure the safety of our properties, employees, and residents and to provide operator support in this regard, the impact of the COVID-19 pandemic on our facilities could result in additional operational costs and reputational and litigation risk to us. As a result of the COVID- 19 pandemic, operator and tenant cost of insurance is expected to increase and such insurance may not cover certain claims related to COVID-19. Our exposure to COVID-19 related litigation risk may be increased if the operators or tenants of the relevant facilities are subject to bankruptcy or insolvency. In addition, we are facing increased operational challenges and costs resulting from logistical challenges such as supply chain interruptions, business closures and restrictions on the movement of people.
●	Risks Related to Property Acquisitions and Dispositions: As a result of uncertainty regarding the length and severity of the COVID-19 pandemic and the impact of the pandemic on our business and related industries, our investments in and acquisitions of senior housing and health care properties, as well as our ability to transition or sell properties with profitable results, may be limited. We have a significant development portfolio and have not experienced significant delays or disruptions but may in the future. Such disruptions to acquisition, disposition and development activity may negatively impact our long-term competitive position.
●	Risks Related to Liquidity: The COVID-19 pandemic and related public health measures implemented by governments worldwide has had severe global macroeconomic impacts and has resulted in significant financial market volatility. An extended period of volatility or a downturn in the financial markets could result in increased cost of capital. If our access to capital is restricted or our borrowing costs increase as a result of developments in financial markets relating to the pandemic, our operations and financial condition could be adversely impacted. In addition, a prolonged period of decreased revenue and limited acquisition and disposition activity operations could adversely affect our financial condition and long-term growth prospects and there can also be no assurance that we will not face credit rating downgrades. Future downgrades could adversely affect our cost of capital, liquidity, competitive position, and access to capital markets.

 

The events and consequences discussed in these risk factors could, in circumstances we may not be able to accurately predict, recognize or control, have a material adverse effect on our business, growth, reputation, prospects, financial condition, operating results, cash flows, liquidity, ability to pay dividends and stock price. As the COVID-19 pandemic continues to adversely affect our operating and financial results, it may also have the effect of heightening many of the other risks described in this Report.

 

ITEM 1B.

UNRESOLVED STAFF COMMENTS

 

Not applicable.

 

ITEM 1C.

CYBERSECURITY

 

One of the functions of our Board of Directors is informed oversight of our risk management process, including risks from cybersecurity threats. Our Board is responsible for monitoring and assessing strategic risk exposure, and management is responsible for the day-to-day management of any material risks that may arise. The Board receives updates as needed from management regarding cybersecurity matters and is notified between such updates regarding any significant new cybersecurity threats or incidents. We do not believe that there are currently any known risks from cybersecurity threats that are reasonably likely to materially affect us or our business strategy, results of operations or financial condition

 

As of December 31, 2023, we have not identified an indication of a cybersecurity incident that would have a material impact on our business and consolidated financial statements.

 

Risk Management and Strategy

 

As one of the critical elements of our overall ERM approach, our cybersecurity efforts are focused on the following key areas:

 

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Governance: Management oversees cybersecurity risk mitigation and reports to the board of directors any cybersecurity incidents.

 

●

Collaborative Approach: We have implemented a cross-functional approach to identifying, preventing and mitigating cybersecurity threats and incidents, while also implementing controls and procedures that provide for the prompt escalation of certain cybersecurity incidents so that decisions regarding the public disclosure and reporting of such incidents can be made by management in a timely manner.

 

●

Technical Safeguards: We deploy technical safeguards that are designed to protect our information systems from cybersecurity threats, including firewalls, intrusion prevention and detection systems, anti-malware functionality and access controls, which are evaluated and improved through vulnerability assessments and cybersecurity threat intelligence.

 

Third parties also play a role in our cybersecurity. We engage third-party service providers to conduct evaluations of our security controls, independent audits or consulting on best practices to address new challenges.

 

While we have experienced cybersecurity threats in the past in the normal course of business and expect to continue to experience such threats from time to time, to date, none have had a material adverse effect on our business, financial condition, results of operations or cash flows. Even with the approach we take to cybersecurity, we may not be successful in preventing or mitigating a cybersecurity incident that could have a material adverse effect on us.

 

 

ITEM 2.

PROPERTIES

 

As of December 31, 2023, we owned thirteen (13) long-term care facilities including a campus of three buildings in Tulsa, OK. The following table provides summary information regarding these facilities at December 31, 2023:

 

														Total Square Feet								# of Beds
State		Properties				Operations				Leased Operations				Operating Square Feet				Leased Square Feet				Operating Beds				Leased Beds
Arkansas			1				-				1				-				40,737				-				141
Georgia			5				4				1				78,197				46,199				454				100
Ohio			1				-				-				27,500				-				99				-
Oklahoma			6				5				-				162,976				-				351				-
Total			13				9				2				268,673				86,936				904				241

 

ITEM 3.

LEGAL PROCEEDINGS

 

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

 

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, filed in April 2016. 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.

 

Oliphant v. Global Eastman, LLC, et.al., State Court of Cobb County, State of Georgia, Civil Action No. 20-A-3983

 

This is a personal injury lawsuit against various defendants arising out of the death of a patient of the Eastman Healthcare & Rehab Center (the “Facility”). At all relevant times, the Facility was owned by the Company’s wholly owned subsidiary Dodge NH, LLC and leased to Eastman Health & Rehab LLC, an affiliate of Cadence Healthcare, as lease operator. Neither the Company nor any affiliate of the Company had any involvement in patient care at the time of the incident for which complaint was made. The Company relies upon well-settled Georgia law that a landlord has no liability for patient care. The landlord is Dodge NH, LLC. Global Eastman, LLC was not formed as a legal entity during the period of the incident and did not assume the past liabilities as part of the OTA with the receivership of Eastman Healthcare & Rehab LLC which was effective July 1, 2020. Global Eastman LLC was formed on November 21, 2019. Plaintiff has dismissed these claims with prejudice, and the Company has filed a Motion to be awarded attorney’s fees and costs.

 

Lawson v. C.R.M of Warrenton, LLC d/b/a Warrenton Health and Rehab; ATL/WARR, LLC; Selectis Warrenton, LLC, et.al., Superior Court of Warren County, State of Georgia, Civil Action No. 23CV0076.

 

This is a personal injury lawsuit filed on June 14, 2023 against various defendants arising out of the death of a patient of the Warrenton Health and Rehab Facility located in Warren, Georgia (the “Facility”). The Facility is owned by the Company’s wholly-owned subsidiary ATL/Warr, LLC. At all relevant times, the Facility was leased and operated by a third party C.R.M. Warrenton, LLC under an operating lease. Neither the Company nor any affiliate of the Company had any involvement in patient care at the time of the incident for which complaint was made. The Company relies upon well-settled Georgia law that a landlord has no liability for patient care. Subsequent to the patient care complained of the Company entered into an Operations Transfer Agreement with the lease operator and assumed operating control of the Facility through a new subsidiary, Selectis Warrenton, LLC. The Company believes its exposure in this matter is de minimus and has referred the litigation to its insurance company for management.

 

Hines v. Global Abbeville LLC, d/b/a Glen Eagle, et al, Superior Court of Warren County, State of Georgia, Civil Action No.2023-CV-094

 

This is a personal injury lawsuit filed on September 11, 2023 against various defendants arising from injuries several months after being admitted to the Glen Eagle facility. The complaint alleges that the facility was negligent in the care administered to the plaintiff which resulted in the injuries, which the Company denies. The Company has referred the litigation to its insurance company for management and believes that its exposure in this matter is de minimus.

 

Hunter v. Global Abbeville LLC, d/b/a Glen Eagle, et al, State Court of Fulton County, State of Georgia

 

This is a wrongful death lawsuit filed on June 20, 2023 against various defendants alleging negligence that led to the death of the plaintiff’s mother who had been admitted to the facility. The complaint alleges that the plaintiffs deviated from the standard of care that caused injuries that ultimately led to the death of the patient, which the Company denies. The Company has referred the litigation to its insurance company for management and believes that its exposure in this matter is de minimus.

 

ITEM 4.

MINE SAFETY DISCLOSURES

 

Not applicable.

 

 

PART II

 

ITEM 5.

MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

 

Outstanding shares of the Company’s common stock are traded over the counter and quoted on the OTC. Pink under the symbol “GBCS”. The reported high and low bid and ask prices for the common stock are shown below for the period from January 1, 2022 through December 31, 2023.

 

		High				Low
Jan – Mar 2022		$	7.72			$	6.40
Apr – June 2022		$	7.32			$	4.50
July – Sept 2022		$	6.30			$	4.55
Oct – Dec 2022		$	6.00			$	1.00
Jan – Mar 2023		$	5.00			$	2.50
Apr – June 2023		$	4.75			$	4.40
July – Sept 2023		$	5.31			$	1.05
Oct – Dec 2023		$	5.31			$	3.12

 

The OTC.Pink prices are bid and ask prices which represent prices between broker-dealers and do not include retail mark-ups and mark-downs or any commissions to the broker-dealer. The prices do not reflect prices in actual transactions. As of April 6, 2024, there were approximately 93 record owners of the Company’s common stock not including stock held in street name.

 

The OTC.Pink is a quotation service that displays real-time quotes, last sale prices and volume information in over the counter (OTC) securities. An OTC equity security generally is any equity that is not listed or traded on any national securities exchange. The OTC.Pink is not an issuer listing service, market, or exchange. Although the OTC.Pink does not have any listing requirements, per se, to be eligible for quotation on the OTC.Pink, issuers must remain current in their filings with the SEC or applicable regulatory authority.

 

The Company’s Board of Directors may declare and pay dividends on outstanding shares of common stock out of funds legally available therefore in its sole discretion. For the years ended December 31, 2023, and 2022, the Company paid no dividends on common stock but did pay the 8% dividends on our outstanding shares of Series D Preferred Stock. Future dividends on our common stock will be authorized at the discretion of our Board of Directors and will depend on our actual cash flow, financial condition, capital requirements, and other factors as our Board of Directors may deem relevant.

 

Recent Sales of Unregistered Securities

 

None, except as previously reported on Forms 8-K.

 

EQUITY COMPENSATION PLAN INFORMATION

 

In May 2021, the Company adopted its 2021 Equity Incentive Plan and authorized an aggregate of 300,000 shares of Common Stock to be issued pursuant to rights granted under the Plan. As of the date of this Report, no options, SAR’s or other rights to acquire shares of Common Stock under the Plan had been granted or are outstanding.

 

ITEM 6.

[Reserved]

 

Not applicable.

 

 

ITEM 7.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

RESULTS OF OPERATIONS

 

Rental revenue for the year ended December 31, 2023, totaled $634,570, compared to $591,808 for the year ended December 31, 2022, an increase of $42,762. The Company also had Healthcare revenue of $34,537,723 for the year ended December 31, 2023, a decrease of $2,197,960, compared to $36,735,683 for the year ended December 31, 2022. The Company also had Healthcare Grant revenue of $1,610,754 for the year ended December 31, 2023, a decrease of $1,661,272, compared to $3,272,026 for the year ended December 31, 2022. Healthcare revenues decreased due to a decrease in occupancy and a change in patient mix. The decrease in healthcare grant revenues is primarily due to a one-time $973,093 quality metric achievement grant during the year ended December 31, 2022. Also, the healthcare grant revenues received from the State of Oklahoma ceased in May 2023. As we assume operations and purchase more facilities, we anticipate increases in revenue. As a result of this, our rental income will likely continue to decrease.

 

General and administrative expenses were $9,968,188 for the year ended December 31, 2023, compared to $7,869,645 for the year ended December 31, 2022, an increase of $2,098,543. The increase is primarily attributed to the contingent fees incurred for the receipt of CARES Employee Retention Credits and an increase in specialized professional services.

 

Property taxes, insurance, and other operating expenses totaled $31,375,921 and $29,859,250 for the years ended December 31, 2023, and 2022, respectively, an increase of $1,516,671. This increase is attributed to an increase in operational headcount resulting in higher operational wages.

 

In September 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instrument (“ASU 2016-13”). ASU 2016-13 requires entities to use a forward-looking approach based on current expected credit losses (“CECL”) to estimate credit losses on certain types of financial instruments, including trade receivables. This may result in the earlier recognition of allowances for losses. The Company adopted ASU 2016-13 January 1, 2023. We identified trade and ERTC accounts receivable financial instruments that would be impacted by this adoption. Expenses related to the provision for bad debt were $2,733,157 for the year ended December 31, 2023, and $1,364,354 for the year ended December 31, 2022, an increase of $1,368,803. This increase is due to the additional reserve booked for ERTC collections.

 

Depreciation and amortization expense totaled $1,666,200 for the year ended December 31, 2023, compared to $1,792,840 for the year ended December 31, 2022, a decrease of $126,640. This decrease is related to an increase in fully depreciated assets as compared to the same period in the prior year.

 

The Company had $2,173,763 of net interest expense for the year ended December 31, 2023, and $2,231,233 of net interest expense for the year ended December 31, 2022. This decrease is related to the refinancing mortgages during the year ended December 31, 2021.

 

 

For the years ended December 31, 2023 and 2022, we recorded loss on extinguishment of debt of $0 and $46,466, respectively. During 2022, the Company recorded extinguishment of debt of $46,466 in connection with the forgiveness of the entire balance of principal and accrued interest on the remaining PPP loan.

 

For the years ended December 31, 2023 and 2022, we recorded income from employee retention credits of $6,866,759 and $0, respectively. The CARES Act provides an employee retention credit (“CARES Employee Retention Credit”), which is a refundable tax credit against certain employment taxes of up to $5,000 per employee for eligible employers. The tax credit is equal to 50% of qualified wages paid to employees during a quarter, capped at $10,000 of qualified wages per employee through December 31, 2020. Additional relief provisions were passed by the United States government, which extend and slightly expand the qualified wage caps on these credits through December 31, 2021. Based on these additional provisions, the tax credit is now equal to 70% of qualified wages paid to employees during a quarter, and the limit on qualified wages per employee has been increased to $10,000 of qualified wages per quarter. The Company qualified for the tax credit under the CARES Act for qualified wages for the years ended December 31, 2020 and 2021.

 

The Company recorded other income of $296,442 and $168,458 for the years ended December 31, 2023 and 2022, respectively. Management is recording the principal reduction payments made by the operator for the Arkansas facility as other income. We will continue to record this as the operator continues to satisfy the debt.

 

LIQUIDITY AND CAPITAL RESOURCES

 

Through 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.

 

At December 31, 2023, the Company had cash and cash equivalents of $1,484,599 and restricted cash of $820,124. Our restricted cash is to be expended on insurance, taxes, repairs, and capital expenditures associated with Providence of Sparta Nursing Home or Warrenton Health and Rehab. 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 healthcare operations, rental revenues received, and existing cash on hand. We have successfully refinanced all mortgages that matured in the 2021 and 2022 fiscal years.

 

Cash provided by operating activities was $536,666 for the year ended December 31, 2023, compared to cash used in operating activities was $305,148 for the year ended December 31, 2022. Healthcare revenues decreased due to a decrease in occupancy and a change in patient mix while operating costs increased year over year.

 

Cash used in investing activities was $29,805 for the year ended December 31, 2023, compared to $222,361 for the year ended December 31, 2022. Purchases of property and equipment decreased during the year ended December 31, 2023 compared to the prior year.

 

Cash used in financing activities was $618,114 and $1,848,992 for the years ended December 31, 2023 and 2022, respectively. During the year ended December 31, 2023, we made payments on long-term debt of $695,566. During the year ended December 31, 2022, we made payments on long-term debt of $1,865,458.

 

In accordance with ASU 2014-15 management believes the Company has sufficient liquidity and capital resources to maintain ongoing operations. This is, in part due to refinancing debt to more favorable terms, the continued optimization of our operations in our current facilities and anticipated increases in state Medicaid reimbursement rates. Based on management’s projections, the Company is expected to generate positive cash flows from its continued operations.

 

The focus on opportunities within our current portfolio and future properties to acquire and operate, the settlement, refinance, and continued service of debt obligations, the potential funds generated from stock sales and other initiatives contributing to additional working capital should alleviate any substantial doubt about the Company’s ability to continue as a going concern as defined by ASU 2014-05. However, we cannot predict, with certainty, the outcome of our actions to generate liquidity and the failure to do so could negatively impact our future operations.

 

The CARES Act provides an employee retention credit (“CARES Employee Retention Credit”), which is a refundable tax credit against certain employment taxes of up to $5,000 per employee for eligible employers. The tax credit is equal to 50% of qualified wages paid to employees during a quarter, capped at $10,000 of qualified wages per employee through December 31, 2020. Additional relief provisions were passed by the United States government, which extend and slightly expand the qualified wage caps on these credits through December 31, 2021. Based on these additional provisions, the tax credit is now equal to 70% of qualified wages paid to employees during a quarter, and the limit on qualified wages per employee has been increased to $10,000 of qualified wages per quarter. The Company qualified for the tax credit under the CARES Act for qualified wages for the years ended December 31, 2020 and 2021. In February 2023, the Company submitted filings for CARES Employee Retention Credits totaling $6,866,759. The Company has received a majority of the credits and has fully reserved for the remaining receivable due.

 

 

As of December 31, 2023, and 2022, our debt balances consisted of the following:

 

		December 31, 2023				December 31, 2022
Senior Secured Promissory Notes		$	1,025,000			$	1,025,000
Senior Secured Promissory Notes - Related Parties			750,000				750,000
Fixed-Rate Mortgage Loans			29,570,185				30,568,677
Variable-Rate Mortgage Loans			4,675,585				4,879,462
Other Debt, Subordinated Secured			741,000				741,000
Other Debt, Subordinated Secured - Related Parties			150,000				150,000
Other Debt, Subordinated Secured - Seller Financing			15,105				56,051
Financed Insurance Premiums			875,028				235,125
			37,801,903				38,405,315
Unamortized Discount and Debt Issuance Costs			(555,367	)			(810,997	)
		$	37,246,536			$	37,594,318
As presented in the Consolidated Balance Sheets:
Current Maturities of Long-Term Debt, Net		$	11,170,100			$	2,296,830
Short Term Debt – Related Parties, Net			900,000				900,000
Debt, Net			25,176,435				34,397,488

 

The weighted average interest rate and term of our fixed rate debt were 4.15% and 12.16 years, respectively, as of December 31, 2023.The weighted average interest rate and term of our fixed rate debt are 3.87 % and 12.83 years, respectively, as of December 31, 2022.

 

 

Mortgage Loans and Lines of Credit Secured by Real Estate

 

Mortgage loans and other debts such as lines of credit 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, a former but no longer related party, or corporate guarantees. Mortgage loans for the periods presented consisted of the following:

 

		Number of				Total Face				Total Principal Outstanding as of
State		Properties				Amount				December 31, 2023				December 31, 2022
Arkansas(1)			1			$	5,000,000			$	3,739,786			$	3,910,767
Georgia			5			$	17,765,992			$	15,457,026			$	16,019,874
Ohio			1			$	3,000,000			$	2,563,000			$	2,649,400
Oklahoma(2)(3)			6			$	13,181,325			$	12,485,958			$	12,868,098
			13			$	38,947,317			$	34,245,770			$	35,448,139

 

(1)	The mortgage loan collateralized by this property 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. Guarantors under the mortgage loan include Christopher Brogdon. Mr. Brogdon has assumed operations of the facility and is making payments of principal and interest on the loan on our behalf in lieu of paying rent on the facility to us, until a formal lease can be put in place. During the year ended December 31, 2021, the Company recognized other income of $521,400 for repayments on the loan.
(2)	The Company has refinanced two of its mortgages that would have matured in June and October of 2021 amounting to $2,961,167 and $3,289,595, to extend their maturity dates to May 2024 for both.
(3)	The Company refinanced all three mortgages in July 2021, that would have matured in June and July of 2021 amounting to $2,065,969 and $750,000, $500,000, to extend their maturity dates to June 2027 for all three. Additionally, the Company has refinanced the primary mortgage at the Southern Hills Campus, for 35 years at 2.38%.

 

Subordinated, Corporate, and Other Debt

 

Other debt due at December 31, 2023 and 2022 includes unsecured notes payable issued to entities controlled by the Company used to facilitate the acquisition of the nursing home properties.

 

						Total Principal Outstanding as of								Stated
Property		Face Amount				December 31, 2023				December 31, 2022				Interest Rate		Maturity Date
Goodwill Nursing Home		$	2,030,000			$	741,000			$	741,000			13% Fixed		1-Apr-24
Goodwill Nursing Home – Related Party		$	150,000				150,000				150,000			13% Fixed		30-Nov-25
Higher Call Nursing Center			150,000				15,105				56,051			8% Fixed		1-Apr-24
		$	2,330,000			$	906,105			$	947,051

 

Our corporate debt at December 31, 2023 and 2022 includes unsecured notes and notes secured by all assets of the Company not serving as collateral for other notes.

 

						Total Principal Outstanding as of								Stated
Series		Face Amount				December 31, 2023				December 31, 2022				Interest Rate		Maturity Date
10% Senior Secured Promissory Notes		$	1,255,000			$	1,025,000			$	1,025,000			10% Fixed		30-Jun-24
10% Senior Secured Promissory Notes – Related Party		$	750,000				750,000				750,000			10% Fixed		31-Dec-24
		$	2,005,000			$	1,775,000			$	1,775,000

 

 

Contractual Obligations

 

As of December 31, 2023, we had the following contractual debt obligations:

 

						Less Than												More Than
		Total				1 Year				1 - 3 Years				3 - 5 Years				5 Years
Notes Payable - Principal		$	37,801,903			$	12,625,442			$	9,727,653			$	1,182,524			$	14,266,285
Notes Payable - Interest		$	9,327,104				1,196,825				2,393,051				1,023,296				4,864,162
Total Contractual Obligations		$	47,129,007			$	13,822,267			$	12,120,704			$	2,205,820			$	19,130,447

 

Revenues from operations are sufficient to meet the working capital needs of the Company for the foreseeable future. Cash on hand 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 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, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that we consider material.

 

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

 

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 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 based on relative fair values. Fair value estimates are based on information obtained from independent appraisals, other market data, information obtained during due diligence period. Acquisition-related costs such as due diligence, legal and accounting fees are included in the purchase price. Initial valuations are subject to change during the measurement period, but the period ends as soon as the information is available. The measurement period shall not exceed one year from the date of acquisition.

 

Business Acquisitions

 

Upon acquisition of business entities and real estate determined to be a business combination, the Company identifies and recognizes the net tangible and identified intangible assets based on fair values, and net assets as goodwill or gain on bargain purchase. 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, leasing, and or operating at the specific property. Acquisition-related costs such as due diligence, legal and accounting fees are expensed as incurred. Initial valuations are subject to change during the measurement period, but the period ends as soon as the information is available. The measurement period shall not exceed one year from the date of acquisition.

 

Impairment of Long-Lived Assets

 

When circumstances indicate the carrying value of a 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 or projected cash flows of properties using standard industry valuation techniques.

 

Goodwill

 

Goodwill represents the excess of the cost of an acquired business over the amounts assigned to its net assets. Goodwill is not amortized but is tested for impairment at a reporting unit level on an annual basis or when an event occurs, or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Events or changes in circumstances that may trigger interim impairment reviews include significant changes in business climate, operating results, planned investments in the reporting unit, or an expectation that the carrying amount may not be recoverable, among other factors.

 

The Company may first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events and circumstances, the Company determines it is more likely than not that the fair value of the reporting unit is greater than its carrying amount, an impairment test is unnecessary. If an impairment test is necessary, the Company will estimate the fair value of its related reporting units. If the carrying value of a reporting unit exceeds its fair value, the goodwill of that reporting unit is determined to be impaired, and the Company will proceed with recording an impairment charge equal to the excess of the carrying value over the related fair value.

 

Revenue Recognition

 

The Company recognizes revenue in accordance with ASU 2014-09, “Revenue from Contracts with Customers (Topic 606),” including subsequently issued updates. Under the accounting guidance our revenues are presented net of estimated allowances, and we no longer present the contractual allowance as a separate line item on our balance sheet.

 

The Company reviews its calculations for the realizability of gross service revenues monthly to make certain that we are properly allowing for the uncollectible portion of our gross billings and that our estimates remain sensitive to variances and changes within our payer groups. The contractual allowance calculation is made based on historical allowance rates for the various specific payer groups monthly with a greater emphasis given to current trends. This calculation is routinely analyzed by the Company based on actual allowances issued by payers and the actual payments made to determine what adjustments, if any, are needed.

 

Our revenues generally relate to contracts with patients in which our performance obligations are to provide health care services to the patients. Revenues are recorded during the period our obligations to provide health care services are satisfied. Our performance obligations for inpatient services are generally satisfied over periods that average approximately five days, and revenues are recognized based on charges incurred in relation to total expected charges. The contractual relationships with patients, in most cases, also involve a third-party payer (Medicare, and Medicaid) and the transaction prices for the services provided are dependent upon the terms provided by (Medicare, and Medicaid). Medicare generally pays for inpatient and outpatient services at prospectively determined rates based on clinical, diagnostic and other factors. Services provided to patients having Medicaid coverage are generally paid at prospectively determined rates per discharge, per identified service or per covered member.

 

 

Our revenues are based upon the estimated amounts we expect to be entitled to receive from patients and third-party payers. Estimates of contractual allowances under managed care are based upon the payment terms specified in the related contractual agreements.

 

Laws and regulations governing the Medicare and Medicaid programs are complex and subject to interpretation. Estimated reimbursement amounts are adjusted in subsequent periods as cost reports are prepared and filed and as final settlements are determined (in relation to certain government programs, primarily Medicare, this is generally referred to as the “cost report” filing and settlement process).

 

In September 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instrument (“ASU 2016-13”). ASU 2016-13 requires entities to use a forward-looking approach based on current expected credit losses (“CECL”) to estimate credit losses on certain types of financial instruments, including trade receivables. This may result in the earlier recognition of allowances for losses. The Company adopted ASU 2016-13 January 1, 2023. We identified trade and ERTC accounts receivable financial instruments that would be impacted by this adoption.

 

As part of the analysis, the Company determined that all trade accounts receivable were of similar risk. Given the economy and our services provided, we determined the trade accounts receivable would not be impacted. The Company recorded an allowance of $1,874,068 as of December 31, 2023. This included fully reserving for receivables greater than 90 days. For the year ended December 31, 2023, the Company recorded $1,475,205 on the statement of operations as a provision for bad debts expense.

 

The CARES Act provides an employee retention credit (“CARES Employee Retention Credit”), which is a refundable tax credit against certain employment taxes of up to $5,000 per employee for eligible employers. The tax credit is equal to 50% of qualified wages paid to employees during a quarter, capped at $10,000 of qualified wages per employee through December 31, 2020. Additional relief provisions were passed by the United States government, which extend and slightly expand the qualified wage caps on these credits through December 31, 2021. Based on these additional provisions, the tax credit is now equal to 70% of qualified wages paid to employees during a quarter, and the limit on qualified wages per employee has been increased to $10,000 of qualified wages per quarter. The Company qualified for the tax credit under the CARES Act for qualified wages for the years ended December 31, 2020 and 2021. In February 2023, the Company submitted filings for CARES Employee Retention Credits totaling $6,866,759. As of December 31, 2023, the Company recorded an employee retention credits receivable of $1,257,952. Upon evaluation of the collectability of this receivable, the Company recorded a full allowance against this receivable and recorded an expense to provision for bad debts on the statement of operations.

 

Estimates Use of Estimates

 

The preparation of financial statements in accordance with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as revenues and expenses reported for the period presented. The most significant estimates relate to the useful life and impairment of intangible assets and allowance for doubtful accounts. The Company regularly will assess these estimates and, while actual results may differ, management believes that the estimates are reasonable.

 

ITEM 7A.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

Not applicable.

 

ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

 

See the index included at Item 15. Exhibits, Financial Statement Schedules.

 

ITEM 9.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

 

As previously reported on Form 8-K, effective October 4, 2022, the Company’s Board of Directors, on the recommendation of the Audit Committee that has been separately appointed, approved the appointment of Marcum, LLP to serve as the Company’s independent registered public accounting firm. Prior to its engagement as the Company’s independent registered public accounting firm the Company had not consulted Marcum, LLP with respect to the application of accounting principles to specific transactions or the type of audit opinion that might be rendered on the Company’s financial statements.

 

The Company’s former independent registered public accountants, Haynie & Company, audited the Company’s financial statements through year ended December 31, 2021.

 

ITEM 9A.

CONTROLS AND PROCEDURES

 

Evaluation of Disclosure Controls and Procedures

 

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, as of the end of the period covered by this Report, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Act of 1934. Our disclosure controls and procedures are designed to provide reasonable assurance that the information required to be included in our Securities and Exchange Commission reports is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms, relating to the Company, including our consolidated subsidiaries, and was made known to them by others within those entities, particularly during the period when this report was being prepared.

 

Conclusion Regarding the Effectiveness of Disclosure 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.

 

Management’s Annual Report on Internal Control over Financial Reporting

 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Rule 13a-15(f). Our internal control over financial reporting is a process designed to provide reasonable assurance to our management and board of directors regarding the reliability of financial reporting and the preparation of the consolidated financial statements for external purposes in accordance with U.S. GAAP.

 

Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. GAAP and our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on our consolidated financial statements.

 

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. All internal control systems, no matter how well designed, have inherent limitations, including the possibility of human error and the circumvention of overriding controls. Accordingly, even effective internal control over financial reporting can provide only reasonable assurance with respect to financial statement preparation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2023. In making this assessment, it used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control-Integrated Framework (2013). Management is committed to accurate and ethical business practices. Based on our evaluation, management concluded that our internal controls over financing reporting were not effective as of December 31, 2023 due to material weaknesses in our internal controls over financial reporting. A material weakness is a deficiency, or a combination of control deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim consolidated financial statements will not be prevented or detected on a timely basis.

 

Management noted the following deficiencies that we believe to be material weaknesses:

 

	●	Inadequate design of information technology (IT) general and application controls resulting from inappropriate access given to certain individuals within finance, including the CFO and Controller;
	●	Lack of segregation of duties in certain accounting and financial reporting processes including the initiation, processing, recording and approval of disbursements; and
	●	Lack of a formal review process that includes multiple levels of review as well as timely review of accounts and reconciliations leading to material post-closing adjustments.

 

Our size has prevented us from being able to employ sufficient resources to enable us to have an adequate level of supervision and segregation of duties within our system of internal control. Therefore, while there are some compensating controls in place, it is difficult to ensure effective segregation of accounting and financial reporting duties.

 

Management’s view is that unethical, illegal, or inaccurate conduct in the operations and accounting for the Company violates the trust and integrity of the Company and is damaging to the interests of all stakeholders, and in the long-term misconduct injures the interests of even the individual whom it might initially benefit. This is reinforced periodically with informal conversations and is ingrained in the culture of the Company. When questions arise, they are escalated to the CFO, General Counsel, CEO, President, or Board for review, investigation, direction, and consensus, and external opinion is sought if consensus is not achieved. The Controller and CFO both have direct contact with all levels of review. The Company plans to implement multi-level review in 2024, and management intends to work internally and with various third-parties to ensure we have the proper controls in place going forward.

 

 

This Annual Report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our independent registered public accounting firm pursuant to the SEC rules that permit us to provide only management’s report in this Annual Report.

 

Changes in Internal Control over Financial Reporting

 

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 fiscal quarter ended December 31, 2023, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

ITEM 9B.

OTHER INFORMATION

 

During the quarter ended December 31, 2023, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

 

ITEM 9C.

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTION

 

Not applicable.

 

PART III

 

ITEM 10.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.

 

Directors and Executive Officers

 

The name, position with the Company, age of each Director and executive officer of the Company is as follows:

 

Name		Age		Position		Director/Officer Since
Adam Desmond		53		CEO & Director		2023/2017
Jim Creamer		59		CFO		2023
Andy Sink		55		Director		2022
David Furstenberg		62		Director		2022
Clifford Neuman		75		Director		2023

 

 

Adam Desmond is the founder and CEO of Needle Rock Capital, an investment banking firm located in Carbondale, Colorado. Prior to founding Needle Rock Capital, Mr. Desmond founded ASG Securities in 1998 that focused exclusively on small/mid-cap banks and thrift markets. In 2004 ASG Securities became FIG Partners LLC which expanded the business from a sales and trading platform to a full-service investment banking firm. Mr. Desmond assembled a team of principals at Fig Partners that raised over $2.5 billion in equity since 2007 and completed more than 95 whole bank transactions throughout the United States, with offices in Chicago, Los Angeles, San Francisco, Dallas, New Jersey, and Charlotte, employing over 60 people. Mr. Desmond began his career at the Chicago Mercantile Exchange in the financial quadrant and went on to Raymond James and Associates where he helped develop a high yield fixed income department. Mr. Desmond enjoys supporting and servicing many charitable organizations, including helping fund the building of a school in the Philippines through St. Mary’s Catholic Church in Aspen, Colorado. Mr. Desmond is a graduate of the University of Wisconsin – Madison with a Bachelor of Arts in International Economics and Political Science.

 

Jim Creamer is our Chief Financial Officer as of December 2023. Following a 15-year investment banking career, Creamer brings nearly 20 years of experience in public company leadership roles. In addition to his role at Selectis, Creamer serves as the Principal of Corporate Solutions Advisors, LLC, which offers outsourced, fractional CFO services to small, growth-oriented companies across several industries. He has also served as the CFO and a director of both Virtual Interactive Technologies Corp. (OTC: VRVR), a publicly traded video game development company, and WestMountain Gold, Inc. (OTC: WMTN), a publicly traded mining company. Prior to his role at WestMountain Gold, Creamer was the CFO of NexCore Healthcare Capital Corp. following the company’s acquisition of CapTerra Financial Group, Inc., where he previously served as CFO and later CEO. Creamer holds a Bachelor of Science degree in Finance from Arizona State University.

 

David J. Furstenberg is a tax attorney and certified public accountant with expertise in tax research and planning, IRS and state audits, settlement negotiations, state and federal tax returns, accounting, software and auditor relations. Mr. Furstenberg served as the Director of Taxes at PulteGroup, Inc. (NYSE:PHM) in Bloomfield Hills, Michigan from 1997 to 2016 where he led the tax research and planning functions, including federal, state and international. From 1991 through 1996 he served in the capacities of Assistant Vice President-Taxes, Director of Taxes and Director of Federal Taxes for Handleman Company (NYSE: HDL) in Troy, Michigan. Mr. Furstenberg also served as an Associate Attorney for Levin, Levin, Garvett & Dill, PC in Southfield, Michigan and a Tax Consultant and Tax Associate at Price Waterhouse in Detroit, Michigan. In 1983 David obtained a B.A. in Accounting from Michigan State University and in 1986, a Juris Doctorate from Wayne State University Law School in Detroit, Michigan.

 

Andy Sink is the Co-Founder and Manager of Own Alabama, LLC (an Alabama based commercial real estate investment fund) and also the Managing Director of the Investment Advisory division and Principal for Colliers International | Alabama. His team provides investment property advisory, investment property brokerage, investment fund structuring and real estate investment management to high net worth families and individuals. His team also provides advisory services to privately held operating companies seeking to enhance enterprise value via various real estate strategies including sale leaseback and private fund structuring. Andy Sink has more than 30 years’ experience in the real estate industry with a broad range of expertise in real estate brokerage and investments. He has been involved in numerous investment transactions and development projects with an aggregate value in excess of $700 million. He has also created and managed six different private equity funds and three different private family investment funds with an aggregate value in excess of $100 Million. Andy earned a Bachelor of Science degree in Commerce and Business Administration with a major in real estate from The University of Alabama. Andy is a former member of the board of directors of Selectis Health, a current board of trustees’ member and Secretary of the Eyesight Foundation of Alabama. He is also a board member of Restoration Academy, an inner-city Christian school based in Fairfield Alabama and a member of the Monday Morning Quarterback Club.

 

Clifford Neuman was appointed Director in December 2023. For over 50 years, Mr. Neuman has been engaged as a principal in his own law firms, with an emphasis on corporate and securities law in the representation of companies across matters of corporate finance, mergers, acquisitions, reorganizations, and public and private offerings. He has also served on the boards of numerous public and non-profit companies. Neuman earned his Juris Doctorate degree from the University of Pennsylvania and his Bachelor of Arts degree, summa cum laude, Phi Beta Kappa, from Trinity College in Hartford, Connecticut. Neuman previously served on the Company’s board of directors from 2014 to 2022, and he continues to serve as the Company’s primary legal counsel. In his current board appointment, Neuman’s standing committee appointments have not been determined.

 

 

Family Relationships

 

None.

 

Board Meeting and Compensation

 

During the fiscal year ended December 31, 2023, meetings of the Board of Directors were held telephonically, and business of the board was also conducted by written unanimous consent. There were several meetings of the Board during 2023. A quorum was present at all Board meetings. Directors are entitled to reimbursement of their expenses associated with attendance at such meeting or otherwise incurred in connection with the discharge of their duties as a Director.

 

During fiscal 2021, the entire Board of Directors assumed all responsibilities of the Audit, Compensation and Nominating Committees. During fiscal 2022, Standing Audit, Compensation and Nominating Committees were established.

 

The following table summarizes compensation earned by or paid to the Company’s directors for the year ended December 31, 2023:

 

DIRECTOR COMPENSATION TABLE

 

Name		Fees Earned or Paid in Cash				Stock Awards				Option Awards				Non-Equity Incentive Plan Compensation				Nonqualified Deferred Compensation Earnings				All Other Compensation				Total
Lance Baller (2)		$	30,000				-				-				-				-				-			$	30,000
Christopher Barker (1)		$	12,500				-				-				-				-				-			$	12,500
Clifford Neuman (3)		$	-				-				-				-				-				-			$	-
Adam Desmond (2)		$	30,000				-				-				-				-				-			$	30,000
Andy Sink		$	30.000				-				-				-				-				-			$	30.000
David Furstenberg (4)		$	45,000				-				-				-				-				-			$	45,000

 

(1)	On May 27, 2023, Mr. Barker tendered his resignation as President, Chief Operating Officer and a member of the Board of Directors effective May 31, 2023.
(2)	On October 31, 2023, Mr. Baller tendered his resignation as President, Chief Operating Officer and a member of the Board of Directors effective November 13, 2023. Adam Desmond, a current Board member agreed to be appointed Chief Executive Officer.
(3)	On December 18, 2023, the Company appointed Clifford Neuman to its board of directors. His director fee of $7,500 per quarter will commence in the first quarter of 2024.
(4)	Mr. Furstenberg is our audit committee chair. In addition to receiving a director fee of $7,500 per quarter, he also receives an additional fee of $3,750 per quarter for chairing the committee.

 

Director Independence

 

Our common stock is listed on the OTC.Pink inter-dealer quotation systems, which does not have director independence requirements. Nevertheless, for purposes of determining director independence, we have applied the definition of independence under the NYSE American listing standards. The NYSE American listing standards for smaller reporting companies require that at least 50% of the members of a listed company Board qualify as “independent,” as defined under NYSE American rules and as affirmatively determined by the company’s Board. After review of all the relevant transactions and relationships between each director (and his family members) and the Company, and senior management, the Board affirmatively determined that at all times during the year ended December 31, 2023, and through the date of filing this Annual Report, the following directors (while serving as such) were independent within the meaning of applicable NYSE American rules: Messrs. Sink and Furstenberg.

 

Audit Committee

 

On July 25, 2022 the Company established a standing audit committee The audit committee was initially comprised of Messrs. Furstenberg (Chairman), Neuman and Desmond. Mr. Furstenberg qualifies as an “audit committee financial expert” within the meaning of Item 407(d)(5) of Regulation S-K. An audit committee member is deemed to be independent if he does not possess any vested interests related to those of management and does not have any financial, family, or other material personal ties to management. Effective August 18, 2022, Mr. Neuman resigned as a member of the Audit Committee. Mr. Desmond is no longer eligible to serve on the audit committee due to his role as CEO.

 

The committee is responsible for accounting and internal control matters. The audit committee:

 

-	reviews with management and the independent auditors’ policies and procedures with respect to internal controls;
-	reviews significant accounting matters;
-	approves any significant changes in accounting principles of financial reporting practices;
-	reviews independent auditor services; and
-	recommends to the board of directors the independent registered public accounting firm to audit our consolidated financial statements.

 

In addition to its regular activities, the committee is available to meet with the independent registered public accounting firm or controller whenever a special situation arises.

 

 

The Audit Committee of the Board of Directors will adopt a written charter, which, when adopted, will be filed with the Commission.

 

Compensation Advisory Committee

 

We have established a standing compensation committee in the third quarter of 2022. The compensation committee was initially comprised of Messrs. Desmond, Neuman and Furstenberg. Effective August 18, 2022, Mr. Neuman resigned as a member of the Compensation Committee. Mr. Desmond is no longer eligible to serve on the compensation committee due to his role as CEO.

 

The compensation advisory committee did not meet during fiscal 2023. The compensation advisory committee will:

 

-	recommend to the board of directors the compensation and cash bonus opportunities based on the achievement of objectives set by the compensation advisory committee with respect to our chairman of the board and president, our chief executive officer, and the other executive officers;
-	administer our compensation plans for the same executives;
-	determine equity compensation for all employees;
-	review and approve the cash compensation and bonus objectives for the executive officers; and
-	review various matters relating to employee compensation and benefits.

 

Nomination Process

 

The Board of Directors has appointed a standing nomination committee in the third quarter of 2022, initially consisting of Messrs. Desmond, Neuman and Furstenberg. Effective August 18, 2022, Mr. Neuman resigned from the Nomination and Governance Committee.

 

The board of directors has not adopted a policy regarding the consideration of any director candidates recommended by security holders, since to date the board has not received from any security holder a director nominee recommendation. The board of directors will consider candidates recommended by security holders in the future. Security holders wishing to recommend a director nominee for consideration should contact Mr. Lance Baller, Chairman and CEO, at the Company’s principal executive offices located in Greenwood Village, Colorado and provide to Mr. Baller, in writing, the recommended director nominee’s professional resume covering all activities during the past five years, the information required by Item 401 of Regulation S-K, and a statement of the reasons why the security holder is making the recommendation. Such recommendation must be received by the Company before December 31, 2023.

 

The board of directors believes that any director nominee must possess significant experience in business and/or financial matters as well as a particular interest in the Company’s activities.

 

Shareholder Communications

 

Any shareholder of the Company wishing to communicate to the board of directors may do so by sending written communication to the board of directors to the attention of Mr. Adam Desmond, Chairman and CEO, at the principal executive offices of the Company. The board of directors will consider any such written communication at its next regularly scheduled meeting.

 

Any transactions between the Company and its officers, directors, principal shareholders, or other affiliates have been and will be on terms no less favorable to the Company than could be obtained from unaffiliated third parties on an arms-length basis and will be approved by a majority of the Company’s independent, outside disinterested directors.

 

 

Code of Ethics

 

Our Board of Directors adopted a Code of Business Conduct and Ethics for all of our directors, officers and employees during the fiscal year ended June 30, 2004. We will provide to any person without charge, upon request, a copy of our Code of Business Conduct and Ethics. Such request should be made in writing and addressed to Investor Relations, Selectis Health, Inc., at the Company’s principal executive offices located in Greenwood Village, Colorado. Further, our Code of Business Conduct and Ethics was filed as an exhibit to our Annual Report on Form 8-K dated July 25, 2022 and can be reviewed on the website maintained by the SEC at www.SEC.gov.

 

There are no material proceedings to which any director, officer or affiliate of the Company, any owner of record or beneficially of more than five percent (5%) of any class of voting securities of the Company, or any associate of any such director, officer, affiliate of the Company, or security holder is a party adverse to the Company or any of its subsidiaries or has a material interest adverse to the Company or any of its subsidiaries.

 

Any transactions between the Company and its officers, directors, principal shareholders, or other affiliates have been and will be on terms no less favorable to the Company than could be obtained from unaffiliated third parties on an arms-length basis and will be approved by a majority of the Company’s independent, outside disinterested directors.

 

Indemnification and Limitation on Liability of Directors

 

The Company’s Articles of Incorporation provide that the Company shall indemnify, to the fullest extent permitted by Utah law, any director, officer, employee, or agent of the corporation made or threatened to be made a party to a proceeding, by reason of the former or present official of the person, against judgments, penalties, fines, settlements, and reasonable expenses incurred by the person in connection with the proceeding if certain standards are met. At present, there is no pending litigation or proceeding involving any director, officer, employee, or agent of the Company where indemnification will be required or permitted. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Company pursuant to the foregoing provisions, or otherwise, the Company has been advised that in the opinion of the Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable.

 

The Company’s Articles of Incorporation limit the liability of its directors to the fullest extent permitted by the Utah Business Corporation Act. Specifically, directors of the Company will not be personally liable for monetary damages for breach of fiduciary duty as directors, except for (i) any breach of the duty of loyalty to the Company or its stockholders, (ii) acts or omissions not in good faith or that involved intentional misconduct or a knowing violation of law, (iii) dividends or other distributions of corporate assets that are in contravention of certain statutory or contractual restrictions, (iv) violations of certain laws, or (v) any transaction from which the director derives an improper personal benefit. Liability under federal securities law is not limited by the Articles. The officers of the Company will dedicate sufficient time to fulfill their fiduciary obligations to the Company’s affairs. The Company has no retirement, pension, or profit-sharing plans for its officers and Directors.

 

Compliance with Section 16(a) of the Exchange Act

 

Under the securities laws of the United States, the Company’s Directors, its Executive (and certain other) Officers, and any persons holding more than ten percent (10%) of the Company’s common stock are required to report their ownership of the Company’s common stock and any changes in that ownership to the Securities and Exchange Commission. Specific due dates for these reports have been established and the Company is required to report in this Report any failure to file by these dates. All of these filing requirements were satisfied by our Officers, Directors, and ten-percent holders except for Mr. Baller failed to file one (1) reports covering one (1) transactions in a timely manner and Mr. Barker failed to file one (1) report covering one (1) transaction in a timely manner. In making these statements, the Company has relied on the written representation of its Directors and Officers or copies of the reports that they have filed with the Commission.

 

ITEM 11.

EXECUTIVE COMPENSATION

 

Components of Compensation.

 

None of our executive officers serve as a member of the Compensation Committee or Nominating Committee.

 

The following tables and discussion set forth information with respect to all plan and non-plan compensation awarded to, earned by or paid to the Company’s three (3) most highly compensated executive officers, for all services rendered in all capacities to the Company and its subsidiaries for each of the Company’s last three (3) completed fiscal years; provided, however, that no disclosure has been made for any executive officer, other than the CEO and CFO, whose total annual salary and bonus does not exceed $100,000.

 

 

Company Stock Incentive Plans

 

As of December 31, 2023, no options were outstanding under the Plan and all options to purchase shares of Common Stock have expired. The Plan has terminated in accordance with its terms, and as a result no shares are available for future option grants.

 

SUMMARY COMPENSATION TABLE

 

Name and Principal Position		Year				Salary				Bonus				Stock Awards				Options Awards				Non equity Incentive Plan Compensation				Nonqualified Deferred Compensation Earnings				All Other Compensation				Total
Adam Desmond, CEO			2023			$	27,303				-				-				-				-				-				-			$	27,303
Jim Creamer, CFO			2023			$	15,000				-				-				-				-				-				-			$	15,000
Lance Baller, Former CEO			2023			$	125,000				-				-				-				-				-				-			$	125,000
			2022			$	150,000			$	50,000				-				-				-				-				-			$	200,000
Christopher Barker, Former President & COO			2023			$	61,467				-				-				-				-				-				-			$	61,467
			2022			$	150,000			$	50,000				-				-				-				-				-			$	200,000
Brandon Thall, Former CFO			2022			$	32,769				-				-				-				-				-				-			$	32,769
Mary Lucus, Former CFO			2023			$	34,757								-				-				-				-				-			$	34,757
			2022			$	128,388			$	10,500				-				-				-				-				-			$	138,888

 

 

ITEM 12.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

 

The following table sets forth information with respect to beneficial ownership of our common stock by:

 

*	each person who beneficially owns more than 5% of the common stock;
*	each of our executive officers;
*	each of our directors and director nominees; and
*	all executive officers and directors as a group.

 

The table shows the number of shares owned as of March 29, 2024, and the percentage of outstanding common stock owned as of March 29, 2024. Beneficial ownership is based on information provided to us, and the beneficial owner has no obligation to inform us of or otherwise report any changes in beneficial ownership. Except as indicated, and subject to community property laws when applicable, the persons named in the table below have sole voting and investment power with respect to all shares of common stock shown as beneficially owned by them.

 

Title of Class		Name & Address of Beneficial Owner		Number of Shares Beneficially Owned				Percent (1)(3)
Common Stock
		Lance Baller
		8480 E. Orchard Rd., Ste. 4900
		Greenwood Village, CO 80111			297,682	(2)			9.71	%
		Adam Desmond
		PO Box 2036
		Carbondale, CO 81623			30,282				0.99	%
		David Furstenberg
		8480 E Orchard Rd, Ste 4900
		Greenwood Village, CO 80111			5,910				0.19	%
		Andy Sink
		3058 Lewis Circle
		Birmingham, AL 35223			52,667				1.72	%
		Clifford Neuman
		6800 N 79th Street
		Niwot, CO 80503			122,864				4.01	%
		Zvi Rhine
		895 Mountain Drive
		Deerfield, IL 60015			183,953	(3)			6.00	%
		All Officers and Directors as a Group
		(5 persons)			693,358				22.61	%

 

(1)	Shares not outstanding but beneficially owned by virtue of the individuals right to acquire them as of the date of this annual report or within sixty days of such date, are treated as outstanding when determining the percent of the class owned by such individual.
(2)	Includes 161,965 shares owned individually; 56,616 shares which includes warrants exercisable to purchase 10,000 shares of common stock owned by High Speed Aggregate, Inc. of which Mr. Baller is an owner and control person but disclaims beneficial ownership for purposes of Section 16 under the Exchange Act; 72,934 shares owned by Ultimate Investments Corp., Inc. of which Mr. Baller is an owner and control person but disclaims beneficial ownership for purposes of Section 16 under the Exchange Act and 6,667 shares owned by Baller Family Foundation Inc. of which Mr. Baller is a control person but disclaims beneficial ownership for purposes of Section 16 under the Exchange Act.
(3)	Based on 3,067,059 shares issued and outstanding on April 6, 2024.

 

 

ITEM 13.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

 

For the fiscal year 2022, Selectis Health, Inc. had a net loss, and was able to meet all its obligations without the assistance or needs of affiliated parties lending arrangements.

 

ITEM 14.

PRINCIPAL ACCOUNTANT FEES AND SERVICES.

 

The following is an aggregate of fees billed for each of the last two fiscal years for professional services rendered by Marcum LLP our principal registered public accountants:

 

		2023				2022
Audit Fees - audit of annual financial statements and review of financial statements included in our quarterly reports, services normally provided by the accountant in connection with statutory and regulatory filings.		$	358,993			$	200,637
Audit-Related Fees - related to the performance of audit or review of financial statements not reported under “audit fees” above.		$				$	-
Tax Fees - tax compliance		$	22,758			$	5,000
All Other Fees - services provided by our principal accountants other than those identified above.		$				$	-
Total fees paid or accrued to our principal accountants		$	381,751			$	205,637

 

 

PART IV

 

ITEM 15.

EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

 

The following documents are filed as part of this Annual Report:

 

(a)	Financial Statement Schedules

 

See the Index to Consolidated Financial Statements at page F-1 of this report.

 

(b)	Exhibits
	Exhibit No.		Title
(1)	1.0		Articles of Amendment to the Articles of Incorporation dated June 22, 1994
(1)	3.1		Amended and Restated Articles of Incorporation
(35)	3.1		Amended and Restated Articles of Incorporation
(1)	3.2		Bylaws
(1)	3.3		Certificate of Designations, Preferences, and Rights of Series A Convertible Preferred Stock
(5)	3.4		Certificate of Designations, Preferences, and Rights of Series B Convertible Preferred Stock
(5)	3.5		Certificate of Designations, Preferences, and Rights of Series C Convertible Preferred Stock
(5)	3.6		Agreement Respecting Rights of Holders of Series C Convertible Preferred Stock
(17)	3.7		Certificate of Designations, Preferences, and Rights of Series E Convertible Preferred Stock
(18)	3.8		Form of Registration Rights Agreement
(1)	4.1		Specimen Certificate of Common Stock
(1)	4.2		Specimen Class A Common Stock Purchase Warrant
(1)	4.3		Specimen Class B Common Stock Purchase Warrant
(1)	4.4		Specimen Class C Common Stock Purchase Warrant
(1)	4.5		Warrant Agreement
(19)	4.6		Form of Series 2010 5% Convertible Debenture
(20)	4.7		Form of Common Stock and Warrant Purchase Agreement
(1)	5.0		Opinion of Neuman & Drennen, LLC regarding the legality of the securities being registered
(1)	10.1		Selling Agent Agreement
(1)	10.2		The Casino-Global Venture I Joint Venture Agreement
(1)	10.3		Assignment of Casino-Global Joint Venture Agreement dated January 31, 1994

 

 

(1)	10.4		Nonresidential Lease Agreement between Russian-Turkish Joint Venture Partnership with Hotel Lazurnaya and Global Casino
			Group, Inc. dated September 22, 1993
(1)	10.5		Contract by and between Aztec-Talas-Four Star, Inc. and Global Casinos Group, Inc. dated April 12, 1993, and Addendum to
			Agreement by and between Aztec-Talas-Four Star, Inc., Global Casinos Group, Inc., and Restaurant “Naryn” dated June 29,
			1993.
(1)	10.6		Agreement and Plan of Reorganization among Silver State Casinos, Inc., Colorado Gaming Properties, Inc., and Morgro
			Chemical Company, dated September 8, 1993, incorporated by reference from the Company’s Current Report on Form 8-K,
			dated September 20, 1993
(1)	10.7		Agreement and Plan of Reorganization among Casinos USA., Lincoln Corporation, Woodbine Corporation and Morgro
			Chemical Company, dated October 15, 1993, incorporated by reference from the Company’s Current Report on Form 8-K, dated
			November 19, 1993
(1)	10.8		Stock Pooling and Voting Agreement, incorporated by reference from the Company’s Current Report on Form 8-K, dated
			November 19, 1993
(1)	10.9		Employment Agreement, dated September 28, 1993, between Morgro Chemical Company and Nathan Katz, incorporated by
			reference from the Company’s Current Report on Form 8-K, dated November 19, 1993
(1)	10.10		Employment Agreement, dated October 15, 1993, between Morgro Chemical Company and William P. Martindale, incorporated
			by reference from the Company’s Current Report on Form 8-K, dated November 19, 1993
(1)	10.11		Asset Acquisition Agreement by and among Global Casinos, Inc., Morgro, Inc. and MDO, L.L.C., dated as of February 18,
			1994, incorporated by reference from the Company’s Current Report on Form 8-K, dated February 18, 1994
(1)	10.12		Stock Purchase Agreement, dated March 25, 1994, incorporated by reference from the Company’s Current Report on Form 8-K,
			dated April 29, 1994
(1)	10.13		Articles of Incorporation of BPJ Holding N.V., incorporated by reference from the Company’s Current Report on Form 8-K,
			dated April 29, 1994
(1)	10.14		Aruba Caribbean Resort and Casino Lease Agreement, dated January 18, 1993, incorporated by reference from the Company’s
			Current Report on Form 8-K, dated April 29, 1994
(1)	10.15		Aruba Gaming Permit issued to Dutch Hotel and Casino Development Corporation, incorporated by reference from the
			Company’s Current Report on Form 8-K, dated April 29, 1994
(1)	10.16		Letter Agreement between Astraea Investment Management, L.P. and Global Casinos, Inc. dated May 11, 1994
(1)	10.17		Guaranty from Global Casinos, Inc. to Astraea Investment Management, L.P. dated May 19, 1994
(1)	10.18		Secured Convertible Promissory Note in favor of Global Casinos, Inc. from Astraea Investment Management, L.P. dated May
			19, 1994
(1)	10.19		Registration Rights Agreement between Global Casinos, Inc. and Astraea Investment Management, L.P. dated May 11, 1994
(1)	10.20		Employment Agreement, dated July 1, 1994, between Global Casinos, Inc., and Peter Bloomquist
(2)	10.21		Letter of Agreement, dated September 16, 1994 between Astraea Management Services, L.P., Casinos USA., Inc. and Global
			Casinos, Inc.
(3)	10.23		Letter of Agreement dated June 27, 1995, between Global Casinos, Inc., Global Casinos International, Inc., Global Casinos
			Group, Inc., Broho Holding, N.V., and Kenneth D. Brown individually.
(1)	10.24		Second Amended Plan of Reorganization of Casinos USA, Inc., and Order Confirming Plan
(1)	10.25		Warrant Agreement
(4)	10.26		Stock Purchase and Sale Agreement between Alaska Bingo Supply, Inc., Global Alaska Industries, Inc., and Mark Griffin

 

 

(5)	10.27		Convertible Promissory Note in the amount of $450,000 dated March 31, 1998 in favor of Mark Griffin
(4)	10.28		General Security Agreement from Global Alaska Industries, Inc. to Mark Griffin
(4)	10.29		Stock Pledge Agreement from Global Alaska Industries, Inc. to Mark Griffin
(5)	10.30		Agreement to Convert Debt dated March 31, 1998 with Mark Griffin
(5)	10.31		Tollgate Casino Lease and Option Agreement
(5)	10.32		Equipment Lease with Plato Foufas & Co., Inc.
(5)	10.33		Employment Agreement of Eric Hartsough
(6)	10.34		Stock Purchase Agreement dated December 30, 1999 between Arufinance, N.V. and Global Casinos, Inc.
(7)	10.35		Term Sheet dated July 24, 2002 between Global Casinos, Inc., Astraea Investment Management L.P., and others.
(7)	10.36		Agreement dated September 17, 2002 among Global Casinos, Inc., Casinos, USA., Inc. and Astraea Investment Management L.P.
(7)	10.37		Agreement and Amendment to Promissory Note dated September 17, 2002 between Casinos USA., Inc. and Astraea Investment Management L.P. for promissory note in the original principal amount of $249,418.48.
(7)	10.38		Agreement and Amendment to Promissory Note dated September 17, 2002 between Casinos USA., Inc. and Astraea Investment Management L.P. for promissory note in the original principal amount of $750,000.
(7)	10.39		Agreement and Amendment to Promissory Note dated September 17, 2002 between Casinos USA., Inc. and Astraea Investment Management L.P. for promissory note in the original principal amount of $783,103.56.
(7)	10.40		Assumption Agreement dated September 17, 2002 among, Global Casinos, Inc., Casinos USA., Inc. and Astraea Investment Management L.P.
(7)	10.41		Bill of Sale, Assignment and Assumption dated October 30, 2002 between Global Casinos, Inc. and Casinos, USA., Inc.
(7)	10.42		Option Agreement dated September 17, 2002 by and between Astraea Investment Management L.P. and Global Casinos, Inc.
(7)	10.43		Security Agreement dated September 17, 2002 by Casinos USA., Inc. in favor of Astraea Investment Management L.P.
(7)	10.44		Service Agreement dated as of September 17, 2002 between Casinos USA., Inc. and Global Casinos, Inc.
(7)	10.45		Stock Pledge Agreement dated as of September 17, 2002 between Global Casinos, Inc., and Astraea Investment Management L.P.
(7)	10.46		Voting Agreement dated as of September 17, 2002 between Casinos USA., Inc. and Global Casinos, Inc.
(9)	10.47		Asset Purchase and Sale Agreement dated June 14, 2007.

 

 

(10)	10.49		Amendment No. 1 to Asset Purchase and Sale Agreement dated June 14, 2007
(8)	14.		Code of Ethics
(11)	10.50		Amendment No. 2 to Asset Purchase and Sale Agreement dated June 14, 2007.
(12)	10.51		Amendment No. 3 to Asset Purchase and Sale Agreement dated June 14, 2007.
(13)	10.52		Amendment No. 4 to Asset Purchase and Sale Agreement dated June 14, 2007.
(15))	10.53		Amendment No. 5 to Asset Purchase and Sale Agreement dated June 14, 2007.
(15)	10.54		Articles of Organization of Doc Holliday Casino II, LLC
(15)	10.55		Operating Agreement of Doc Holliday Casino II, LLC
(15)	10.56		Certificate of Series D for Global Casinos Inc
(15)	10.57		Consent to Assignment of Lease to Global Casinos
(15)	10.58		Consent to Assignment of Lease to Doc Holliday Casino II
(15)	10.59		Assignment & Assumption of Lease by Doc Holliday II
(15)	10.60		Promissory Note $550,000
(15)	10.61		Promissory Note $400,000
(15)	10.62		Promissory Note $155,000
(15)	10.63		Bill of Sale
(15)	10.64		Noncompetition and Confidentiality Agreement
(15)	10.65		Consultation Agreement
(16)	10.66		Lease Agreement
(16)	10.67		Addendum to Lease Agreement
(16)	10.68		Addendum No. 2 to Lease Agreement
(16)	10.69		Loan Agreement with Astraea Investment Management
(16)	10.70		Assignment of Note
(16)	10.71		Assignment and Assumption Agreement
(16)	10.72		Second Amendment to Promissory Note
(21)	10.73		Astraea Loan Document Purchase and Assignment Agreement
(22)	10.74		Martindale Allonge and Loan Participation Agreement
(23)	10.75		Montrose Allonge and Modification Agreement

 

 

(24)	10.76		Bloomquist Allonge and Loan Participation Agreement
(25)	10.77		Shupp Allonge and Modification Agreement
(26)	10.78		Amendment to Lease Agreement dated December 28, 2010
(27)	10.79		Class A Stock Purchase Warrant
(27)	10.79		Series 2011 8% unsecured convertible note
(28)	10.80		Split-Off Agreement
(28)	10.81		Stock Purchase Agreement
(29)	10.82		Promissory Note
(29)	10.83		Stock Pledge Agreement
(30)	10.84		Amended and Restated Allonge and Loan Participation Agreement
(30)	10.85		Form of Warrant
(31)	10.86		Second Allonge and Modification Agreement
(31)	10.87		Modification to Second Deed of Trust
(32)	10.88		Amendment No. 2 to Loan Participation Agreement
(33)	10.89		Termination and Mutual Release
(33)	10.90		Amendment No. 1 to Split-Off Agreement
(33)	10.91		Stock Purchase Agreement
(34)	10.92		Amended and Restated Split-Off Agreement
(35)	10.93		Loan Purchase Agreement
(35)	10.94		Assignment of Deed of Trust
(35)	10.95		Assignment of Note
(35)	10.96		Assignment, Assumption, and Indemnity Agreement
(35)	10.97		Security and Hypothecation Agreement
(35)	10.98		Intercompany Agreement

 

 

(35)	10.99		Promissory Note
(36)	10.100		Scottsburg Membership Purchase Agreement
(37)	10.101		Purchase Agreement dated October 8, 2008
(37)	10.102		Amendment No. 1 to Purchase Agreement dated October 8, 2008
(37)	10.103		Amendment No. 2 to Purchase Agreement dated October 8, 2008
(37)	10.104		Amendment No. 3 to Purchase Agreement dated October 8, 2008
(37)	10.105		Amendment No. 4 to Purchase Agreement dated October 8, 2008
(37)	10.106		Amendment No. 5 to Purchase Agreement dated October 8, 2008
(38)	10.107		Membership Interest Purchase Agreement - Goodwill
(39)	10.108		Purchase and Sale Agreement – Meadowview
(40)	10.109		Purchase and Sale Agreements – Longview, Mountainview, Corpus Christi and Grand Prairie
(41)	10.110		Amendments to Purchase and Sale Agreements – Longview, Corpus Christi, and Grand Prairie
(41)	10.111		Assignment of Purchase and Sale Agreements – Longview, Mountainview, Corpus Christi and Grand Prairie
(42)	10.112		Letters Terminating Purchase Agreements - Longview, Mountainview, Corpus Christi and Grand Prairie
(43)	10.113		Stock Purchase Agreement between Tilford, Inc. and TNH Acquisition, LLC
(44)	10.114		First Amendment to Stock Purchase Agreement
(45)	10.115		Purchase and Sale Agreement – Greene Point Health Center
(46)	10.116		Promissory Note Purchase Agreement
(47)	10.117		Form of Security Agreement
(47)	10.118		Form of Agreement Among Lenders
(47)	10.119		Form of Promissory Note
(48)	10.120		2017 Investor Presentation
(49)	10.121		Allonge and Modification Agreement
(50)	10.122		Revised 2017 Investor Presentation
(51)	10.123		HUD Note – Providence HR, LLC
(52)	10.124		Meadowview Note – High Street Nursing, LLC
(53)	10.125		Credit Note – Southern Tulsa, LLC and Southern Tulsa TLC, LLC
(54)	10.126		Form of Agreement Among Lenders

 

 

(55)	10.127		Form of Promissory Note
(56)	10.128		Purchase and Sale Agreement
(57)	10.129		2018 Investor Presentation
(58)	10.130		Restricted Stock Award Agreement
(59)	10.131		Notice of Grant
(60)	10.132		Option Agreement
(61)	10.133		Employment Agreement
(62)	10.134		Revised 2018 Investor Presentation
(63)	10.135		Form of Note
(64)	10.136		Asset Purchase Agreement
(65)	10.137		Amendment No. 1 to Employment Agreement
(66)	10.138		Healthcare Facility Note
(67)	10.139		Loan Document Purchase and Assignment Agreement
(68)	10.140		November 2019 Investor Presentation
(69)	10.141		Asset Purchase Agreement
(70)	10.142		Form of Senior Note
(71)	10.143		Form of Mortgage, Security Agreement and Assignment of Rents
(72)	10.144		Form of Security Agreement
(73)	10.145		Form of Seller Note
(74)	10.146		Form of Corporate Guaranty
(75)	10.147		Asset Purchase Agreement
(76)	10.148		Promissory Note
(77)	10.149		Mortgage
(78)	10.150		Amendment No. 1 to Second Amended and Restated Articles of Incorporation
(79)	10.151		Healthcare Mortgage, Assignment of Leases and Rents and Security Agreement
(80)	10.152		Healthcare Facility Note
(81)	10.153		Deferred Compensation and Equity Award Plan
(82)	10.154		Baller Restricted Stock Unit
(83)	10.155		Barker Restricted Stock Unit

 

 

 

(84)	10.156		Rescission Agreement
(85)	10.157		Pursuant to Item 304(a)(1) of Regulation S-K, the Registrant herewith files the letter of MaloneBailey, LLP, former accountants to the Company
*	31.1		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
*	31.2		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
*	32.1		Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
*	32.2		Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
**	101.INS		Inline XBRL Instance
**	101.SCH		Inline XBRL Taxonomy Extension Schema
**	101.CAL		Inline XBRL Taxonomy Extension Calculation
**	101.DEF		Inline XBRL Taxonomy Extension Definition
**	101.LAB		Inline XBRL Taxonomy Extension Labels
**	101.PRE		Inline XBRL Taxonomy Extension Presentation
	104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

(1)	Incorporated by reference to the Registrant’s Registration Statement on Form SB-2, Registration No. 33-76204, on file with the Commission on August 11, 1994.
(2)	Incorporated by reference to the Registrant’s Annual Report on Form 10-KSB for year ended June 30, 1994.
(3)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated July 15, 1995.
(4)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated August 1, 1997, as filed with the Commission on August 14, 1997.
(5)	Incorporated by reference to the Registrant’s Annual Report on Form 10KSB for the year ended June 30, 1999.
(6)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated December 30, 1999, as filed with the Commission on January 14, 2000.
(7)	Incorporated by reference to the Registrant’s Annual Report on Form 10KSB for the year ended June 30, 2002.
(8)	Incorporated by reference to the Registrant’s Annual Report on Form 10KSB for the year ended June 30, 2004.
(9)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated June 14, 2007 as filed with the Commission on June 19, 2007

 

 

(10)	Incorporated by reference to the Registrant’s Current Report on Form 8-K/A dated September 28, 2007 as filed with the Commission on October 2, 2007.
(11)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated November 30, 2007 as filed with the Commission on December 3, 2007.
(12)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated December 5, 2007 as filed with the Commission on December 6, 2007.
(13)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated January 30, 2008 as filed with the Commission on February 4, 2008.
(14)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated March 6, 2008 as filed with the Commission on March 6, 2008.
(15)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated March 18, 2008 as filed with the Commission on March 24, 2008.
(16)	Incorporated by reference to the Registrant’s Current Report on Form 8-K/A dated March 18, 2008 as filed with the Commission on May 29, 2008.
(17)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated July 12, 2010 as filed with the Commission on July 14, 2010.
(18)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated July 19, 2010 as filed with the Commission on July 20, 2010.
(19)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated July 16, 2010 as filed with the Commission on July 20, 2010.
(20)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated July 16, 2010 as filed with the Commission on July 20, 2010.
(21)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated November 30, 2009 as filed with the Commission on December 3, 2009.
(22)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated November 30, 2009 as filed with the Commission on December 3, 2009.
(23)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated December 30, 2009 as filed with the Commission on December 31, 2009.
(24)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated December 30, 2009 as filed with the Commission on January 5, 2010.
(25)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated March 25, 2010 as filed with the Commission on March 25, 2010.
(26)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated December 28, 2010 as filed with the Commission on December 29, 2010 as amended by Form 8-K/A filed with the Commission on February 10, 2011.
(27)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated December 20, 2011 as filed with the Commission on December 20, 2011
(28)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated June 1, 2012 as filed with the Commission on June 6, 2012.
(29)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated June 25, 2012 as filed with the Commission on June 28, 2012.
(30)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated October 11, 2012 as filed with the Commission on October 16, 2012.

 

 

(31)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated November 9, 2012 as filed with the Commission on November 13, 2012.
(32)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated December 20, 2012 as filed with the Commission on December 20, 2012.
(33)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated April 8, 2013 as filed with the Commission on April 12, 2013.
(34)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated May 4, 2013 as filed with the Commission on May 6, 2013.
(35)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated September 30, 2013 as filed with the Commission on October 4, 2013.
(36)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated January 27, 2014 as05 filed with the Commission on January 30, 2014.
(37)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated March 10, 2014 as filed with the Commission on March 14, 2014.
(38)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated May 23, 2014 as filed with the Commission on May 19, 2014.
(38)	Incorporated by reference to the Registrant’s Current Report on Form 8-K/A dated May 23, 2014 as filed with the Commission on May 19, 2014.
(39)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated September 26, 2014 as filed with the Commission on October 2, 2014.
(40)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated December 16, 2014 as filed with the Commission on December 17, 2014.
(41)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated January 22, 2015 as filed with the Commission on January 27, 2015
(42)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated January 28, 2015 as filed with the Commission on February 4, 2015.
(43)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated August 14, 2015 as filed with the Commission on August 20, 2015.
(44)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated November 9, 2015 as filed with the Commission on November 12, 2015.
(45)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated June 30, 2016 as filed with the Commission on July 5, 2016.
(46)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated August 29, 2016 as filed with the Commission on August 30, 2016.

 

 

(47)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated November 25, 2016 as filed with the Commission on November 29, 2016.
(48)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated January 25, 2017 as filed with the Commission on January 26, 2017.
(49)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated May 3, 2017 as filed with the Commission on May 8, 2017.
(50)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated May 16, 2017 as filed with the Commission on May 16, 2017.
(51)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated October 27, 2017 as filed with the Commission on November 6, 2017.
(52)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated October 27, 2017 as filed with the Commission on November 6, 2017.
(53)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated October 27, 2017 as filed with the Commission on November 6, 2017.
(54)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated November 8, 2017 as filed with the Commission on November 17, 2017.
(55)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated November 8, 2017 as filed with the Commission on November 17, 2017.
(56)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated April 5, 2018 as filed with the Commission on April 17, 2018.
(57)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated April 24, 2018 as filed with the Commission on April 24, 2018.
(58)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated May 4, 2018 as filed with the Commission on May 10, 2018.
(59)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated May 4, 2018 as filed with the Commission on May 10, 2018.
(60)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated May 4, 2018 as filed with the Commission on May 10, 2018.
(61)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated May 4, 2018 as filed with the Commission on May 10, 2018.
(62)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated August 27, 2018 as filed with the Commission on August 27, 2018.
(63)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated October 15, 2018 as filed with the Commission on October 22, 2018.
(64)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated April 12, 2019 as filed with the Commission on April 16, 2019.

 

 

(65)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated April 15, 2019 as filed with the Commission on April 17, 2019.
(66)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated June 13, 2019 as filed with the Commission on July 11, 2019.
(67)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated August 6, 2019 as filed with the Commission on August 14, 2019.
(68)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated November 19, 2019 as filed with the Commission on November 19, 2019.
(69)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated March 2, 2020 as filed with the Commission on March 5, 2020.
(70)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated March 2, 2020 as filed with the Commission on March 5, 2020.
(71)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated March 2, 2020 as filed with the Commission on March 5, 2020.
(72)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated March 2, 2020 as filed with the Commission on March 5, 2020.
(73)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated March 2, 2020 as filed with the Commission on March 5, 2020.
(74)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated March 2, 2020 as filed with the Commission on March 5, 2020.
(75)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated July 23, 2020 as filed with the Commission on July 27, 2020.
(76)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated December 31, 2020 as filed with the Commission on January 6, 2021.
(77)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated December 31, 2020 as filed with the Commission on January 6, 2021.
(78)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated September 21, 2021 as filed with the Commission on September 22, 2021.
(79)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated September 27, 2021 as filed with the Commission on October 4, 2021.
(80)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated September 27, 2021 as filed with the Commission on October 4, 2021.
(81)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated December 29, 2021 as filed with the Commission on December 30, 2021.
(82)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated December 29, 2021 as filed with the Commission on December 30, 2021.
(83)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated December 29, 2021 as filed with the Commission on December 30, 2021.
(84)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated December 29, 2021 as filed with the Commission on January 3, 2022.
(85)	Incorporated by reference to the Registrant’s Current Report on Form 8-K dated January 26, 2022 as filed with the Commission on January 28, 2022.

 

*	Filed herewith
**	furnished, not filed.

 

 

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

of Selectis Health, Inc. and Subsidiaries

 

	Page No.
Report of Independent Registered Public Accounting Firm – Marcum LLP – PCAOB ID: 688	F-1
Consolidated Balance Sheets of Selectis Health, Inc. as of December 31, 2023 and 2022	F-2
Consolidated Statements of Operations of Selectis Health, Inc. for the Years Ended December 31, 2023 and 2022	F-3
Consolidated Statements of Changes in Equity of Selectis Health, Inc. for the Years Ended December 31, 2023 and 2022	F-4
Consolidated Statements of Cash Flows of Selectis Health, Inc. for the Years Ended December 31, 2023 and 2022	F-5
Notes to Consolidated Financial Statements	F-6

 

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 

To the Shareholders and Board of Directors of

Selectis Health, Inc.

 

Opinion on the Financial Statements

 

We have audited the accompanying consolidated balance sheet of Selectis Health, Inc. (the “Company”) as of December 31, 2023 and 2022, the related consolidated statements of operations, stockholders’ equity and cash flows for the years ended December 31, 2023 and 2022, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for the years ended December 31, 2023 and 2022, in conformity with accounting principles generally accepted in the United States of America.

 

Going Concern

 

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As more fully described in Note 1, the Company has a significant working capital deficiency, has incurred significant losses and needs to raise additional funds to meet its obligations and sustain its operations. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

Basis for Opinion

 

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

 

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

 

Marcum LLP

 

We have served as the Company’s auditor since 2022

 

Steve Rapattoni, CPA

Partner

 

Costa Mesa, CA

April 15, 2024

 

 

SELECTIS HEALTH, INC. and Subsidiaries

CONSOLIDATED BALANCE SHEETS

 

		December 31, 2023				December 31, 2022
ASSETS
Current Assets:
Cash and Cash Equivalents		$	1,484,599			$	1,420,200
Accounts Receivable, Net			2,091,536				2,904,741
Prepaid Expenses and Other			1,380,570				637,680
Total Current Assets			4,956,705				4,962,621
Long Term Assets:
Restricted Cash			820,124				996,400
Property and Equipment, Net			33,817,718				35,454,113
Goodwill			1,076,908				1,076,908
Total Assets		$	40,671,455			$	42,490,042
LIABILITIES AND EQUITY
Liabilities:
Accounts Payable and Accrued Liabilities			6,045,365				3,644,001
Dividends Payable			30,600				7,500
Short term debt – Related Parties,			900,000				900,000
Current Maturities of Long-Term Debt, Net of Discount of $524,704 and $257,222, respectively			11,170,100				2,296,830
Total Current Liabilities			18,146,065				6,848,331
Debt, Net of discount of $30,663 and $0, respectively			25,176,435				34,397,488
Lease Security Deposit			312,750				291,388
Total Liabilities			43,635,250				41,537,207
Commitments and Contingencies			-				-
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
Preferred stock value			375,000				375,000
Common Stock - $0.05 Par Value; 800,000,000 Shares Authorized, 3,067,059 Shares Issued and Outstanding at December 31, 2023 and December 31, 2022			153,352				152,728
Additional Paid-In Capital			13,852,028				13,768,300
Accumulated Deficit			(17,745,175	)			(13,744,193	)
Total Equity			(2,963,795	)			952,835
Total Liabilities and Equity		$	40,671,455			$	42,490,042

 

See accompanying notes to these consolidated financial statements.

 

 

SELECTIS HEALTH, INC. and Subsidiaries

CONSOLIDATED STATEMENTS OF OPERATIONS

 

		2023				2022
		Twelve Months Ended
		December 31,
		2023				2022
Revenue
Rental Revenue		$	634,570			$	591,808
Healthcare Revenue			34,537,723				36,735,683
Healthcare Grant Revenue			1,610,754				3,272,026
Total Revenue			36,783,047				40,599,517
Expenses
Property Taxes, Insurance and Other Operating			31,375,921				29,859,250
General and Administrative			9,968,188				7,869,645
Provision for Credit Losses			2,733,157				1,364,354
Depreciation and Amortization			1,666,200				1,792,840
Total Expenses			45,743,466				40,886,089
Loss from Operations			(8,960,419	)			(286,572	)
Other (Income) Expense
Loss on Extinguishment of Debt			-				46,466
Interest Expense, net			2,173,763				2,231,233
Income from Employee Retention Credits			(6,866,759	)			-
Other Income			(296,442	)			(168,458	)
Total Other Income			(4,989,437	)			2,109,241
Net Loss			(3,970,982	)			(2,395,813	)
Net Loss Attributable to Noncontrolling Interests			-				-
Net Loss Attributable to Selectis Health, Inc.			(3,970,982	)			(2,395,813	)
Series D Preferred Dividends			(30,000	)			(30,000	)
Net Loss Attributable to Common Stockholders		$	(4,000,982	)		$	(2,425,813	)
Per Share Data:
Net Loss per Share Attributable to Common Stockholders:
Basic		$	(1.31	)		$	(0.79	)
Diluted		$	(1.31	)		$	(0.79	)
Weighted Average Common Shares Outstanding:
Basic			3,054,587				3,054,126
Diluted			3,054,587				3,054,126

 

See accompanying notes to these consolidated financial statements.

 

 

SELECTIS HEALTH, INC. and Subsidiaries

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

 

		Number of Shares				Amount				Number of Shares				Amount				Number of Shares				Amount				Paid-In Capital				Accumulated Deficit				Stockholders’ Equity
		Series A Preferred Stock								Series D Preferred Stock								Common Stock								Additional								Selectis Health, Inc.
		Number of Shares				Amount				Number of Shares				Amount				Number of Shares				Amount				Paid-In Capital				Accumulated Deficit				Stockholders’ Equity
Balance, December 31, 2021			200,500			$	401,000				375,000			$	375,000				2,998,361			$	150,168			$	13,494,394			$	(11,318,380	)		$	3,102,182
Series D Preferred Dividends			-				-				-				-				-				-				-				(30,000	)			(30,000	)
Common Shares Issued for Debt			-				-				-				-				56,226				2,560				227,440				-				230,000
Loss on Forgiveness of Debt, Net			-				-				-				-				-				-				46,466				-				46,466
Net Loss			-				-				-				-				-				-				-				(2,395,813	)			(2,395,813	)
Balance, December 31, 2022			200,500			$	401,000				375,000			$	375,000				3,054,587			$	152,728			$	13,768,300			$	(13,744,193	)		$	952,835
Balance			200,500			$	401,000				375,000			$	375,000				3,054,587			$	152,728			$	13,768,300			$	(13,744,193	)		$	952,835
Warrants Issued for Debt			-				-				-				-				-				-				84,352				-				84,352
Common Stock Issued for Services			-				-				-				-				12,472				624				(624	)			-				-
Series D Preferred Dividends			-				-				-				-				-				-				-				(30,000	)			(30,000	)
Net Loss			-				-				-				-				-				-				-				(3,970,982	)			(3,970,982	)
Balance, December 31, 2023			200,500			$	401,000				375,000			$	375,000				3,067,059			$	153,352			$	13,852,028			$	(17,745,175	)		$	(2,963,795	)
Balance			200,500			$	401,000				375,000			$	375,000				3,067,059			$	153,352			$	13,852,028			$	(17,745,175	)		$	(2,963,795	)

 

See accompanying notes to these consolidated financial statements.

 

 

SELECTIS HEALTH, INC. and Subsidiaries

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

		2023				2022
		Twelve Months Ended December 31,
		2023				2022
Cash Flows from Operating Activities:
Net Loss		$	(3,970,982	)		$	(2,395,813	)
Adjustments to reconcile net loss to net cash used in operating activities:
Other Income from Partial Settlement of Debt			-				(40,436	)
Depreciation and Amortization			1,666,200				1,792,840
Amortization of Deferred Loan Costs and Debt Discount			347,783				315,983
Provision for Bad Debt			2,733,157				1,364,354
Stock Issued for Services			624				-
Changes in Operating Assets and Liabilities:
Accounts and Rents Receivable			(662,000	)			(762,376	)
Prepaid Expenses and Other Assets			(2,000,842	)			1,007,041
Accounts Payable and Accrued Liabilities			2,401,364				(1,648,547	)
Lease Security Deposits			21,362				61,806
Cash Provided By (Used in) Operating Activities			536,666				(305,148	)
Cash Flows from Investing Activities:
Purchases of Property and Equipment			(29,805	)			(222,361	)
Cash Used in Investing Activities			(29,805	)			(222,361	)
Cash Flows from Financing Activities:
Payments on Debt, Non-Related Party			(695,566	)			(1,865,458	)
Dividends Paid on Preferred Stock			(6,900	)			(30,000	)
Debt Discount - Warrants RP			83,728				46,466
Cash Used in Financing Activities			(618,738	)			(1,848,992	)
Net (Decrease) in Cash, Cash Equivalents and Restricted Cash			(111,877	)			(2,376,501	)
Cash and Cash Equivalents and Restricted Cash at Beginning of the Period			2,416,600				4,793,101
Cash and Cash Equivalents and Restricted Cash at End of the Period		$	2,304,723			$	2,416,600
Supplemental Disclosure of Cash Flow Information
Cash Paid for Interest		$	1,782,489			$	1,570,520
Cash and Cash Equivalents			1,484,599				1,420,200
Restricted Cash			820,124				996,400
Total Cash and Cash Equivalents and Restricted Cash			2,304,723				2,416,600
Supplemental Schedule of Non-Cash Investing and Financing Activities
Dividends Declared on Series D Preferred Stock		$	30,000			$	30,000
Issuance of common stock for cashless exercise of warrants			84,352				-
Issuance of common stock for debt			-				230,000
Financing of Insurance Premiums			1,021,676				581,393

 

See accompanying notes to these consolidated financial statements.

 

 

SELECTIS HEALTH, INC. and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 

1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Organization and Description of the Business

 

Selectis Health, Inc (“Selectis” or “we” or the “Company”) owns and operates, through wholly-owned subsidiaries Assisted Living Facilities, Independent Living Facilities, and Skilled Nursing Facilities across the South and Southeastern portions of the US. In 2019, the Company shifted from leasing long-term care facilities to third-party, independent operators towards an owner operator model.

 

Prior to the Company changing its name to Selectis Health, Inc., the Company was known as Global Healthcare REIT, Inc. from September 30, 2013, to May 2021. Prior to this, 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”). WPF was merged into the Company in 2019.

 

In September 2021, the Company rebranded to Selectis Health, Inc., from Global Healthcare REIT, Inc. to better align with the current and future business model, which is to own and operate its facilities.

 

The Company acquires, develops, leases and manages healthcare real estate, provide financing to healthcare providers, and provide healthcare operations through our wholly-owned subsidiaries. Our portfolio is comprised of investments in the following healthcare segments: (i) senior housing (including independent and assisted living) and (ii) post-acute/skilled nursing. We will make investments within our healthcare segments using the following six investment products: (i) direct ownership of properties, (ii) debt investments, (iii) developments and redevelopments, (iv) investment management, (v) the Housing and Economic Recovery Act of 2008 (“RIDEA”), which represents investments in senior housing operations utilizing the structure permitted by RIDEA and (xi) owning healthcare operations.

 

Basis of Presentation

 

The accompanying consolidated financial statements (the Financial Statements) have been prepared in accordance with accounting principles generally accepted in the United States (GAAP). The Company is the sole member of various consolidated limited liability companies established to operate various acquired skilled nursing operations, senior living operations and related ancillary services. All intercompany transactions and balances have been eliminated in consolidation. The Company presents noncontrolling interests within the equity section of its consolidated balance sheets and the amount of consolidated net income that is attributable to Selectis Health, Inc. and the noncontrolling interest in its consolidated statements of operations.

 

The consolidated financial statements include the accounts of all entities controlled by the Company through its ownership of a majority voting interest.

 

Use of Estimates and Assumptions

 

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP” or “GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant estimates included herein relate to the recoverability of assets, the purchase price allocation for properties acquired, and the fair value of certain assets and liabilities. Actual results may differ from estimates.

 

Management’s Liquidity Plans

 

On August 27, 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-05, Disclosure of Uncertainties about an Entity’s ability to Continue as a Going Concern, which requires management to assess a company’s ability to continue as a going concern within one year from financial statement issuance and to provide related footnote disclosures in certain circumstances.

 

For the year ended December 31, 2023 the Company had positive operating cash flows of $0.5 million and a net working capital deficit of $13.2 million. Management is unsure that it will be able to meet its obligations in the next twelve months from the date of these financial statements. This is, in part due to a $11,170,100 in current maturities of our long-term debt occurring during 2024, and that there are no assurances that the Company will be able to refinance these loans. Based on management’s projections of continued operating losses, there is substantial doubt that the Company can generate positive cashflows from its continued operations.

 

F-6

 

Management’s plan to address the Company’s liquidity issues includes, focusing on improving occupancy rates at our facilities to bolster revenues, implementing cost cutting measures at both the facility and corporate level, working with our lenders to extend mortgages and notes that are maturing, and selling off key, underperforming properties to improve our cash flow.

 

These actions should alleviate any substantial doubt about the Company’s ability to continue as a going concern as defined by ASU 2014-05. However, we cannot predict, with certainty, the outcome of our actions to generate liquidity and the failure to do so could negatively impact our future operations.

 

Cash and Cash Equivalents

 

The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.

 

Restricted Cash

 

Restricted cash consisted of the following as of December 31:

 SCHEDULE OF RESTRICTED CASH AND CASH EQUIVALENTS

		2023				2022
Funds held in escrow under the terms of notes for future capital expenditures, repairs and maintenance		$	820,124			$	996,400

 

Concentration of Credit Risk

 

The Company maintains deposits in financial institutions that at times exceed the insured amount of $250,000 provided by the U.S. Federal Deposit Insurance Corporation (FDIC). The Company went to an Insured Cash Sweep service (ICS) in 2021. ICS funds are eligible for multi-million-dollar FDIC insurance that’s backed by the full faith and credit of the United States government. Daily cash is swept and deposited to as many banks as needed that are FDIC insured. This insures no amounts exceed a $250,000 balance which is fully insured by the FDIC. The funds can be tracked by its primary financial institution. New funds can be deposited and withdrawn from that single relationship. The Company believes the financial institutions it uses are credit worthy and stable. The Company does not believe that it is exposed to any significant credit risk in cash and cash equivalents or restricted cash.

 

Property and Equipment

 

In accordance with purchase accounting guidance established for entities under common control, the property and equipment acquired from entities under common control are stated at their carrying value on the date of acquisition. Property and equipment not acquired from entities under common control is recorded at its estimated fair value. Estimated fair value is determined with the assistance from independent valuation specialists using recent sales of similar assets, market conditions or projected cash flows of properties using standard industry valuation techniques.

 

Upon acquisition of real estate properties determined to be asset acquisitions, the Company determines the total purchase price of each property and allocates the purchase price of acquired properties to net tangible and identified intangible assets based on relative fair values. Fair value estimates are based on information obtained from independent appraisals, other market data, and information obtained during due diligence period. Acquisition-related costs such as due diligence, legal and accounting fees are included in the purchase price. Initial valuations are subject to change during the measurement period, but the period ends as soon as the information is available. The measurement period shall not exceed one year from the date of acquisition.

 

F-7

 

Upon acquisition of business entities and real estate determined to be a business combination, the Company identifies and recognizes the net tangible and identified intangible assets based on fair values, and net assets as goodwill or gain on bargain purchase. 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, leasing, and or operating at the specific property. Acquisition-related costs such as due diligence, legal and accounting fees are expensed as incurred. Initial valuations are subject to change during the measurement period, but the period ends as soon as the information is available. The measurement period shall not exceed one year from the date of acquisition.

 

Any subsequent betterments and improvements are stated at historical cost. Depreciation is provided using the straight-line method over the estimated useful lives of the assets, and tenant improvements are depreciated over the remaining term of the lease. Useful lives of the assets are summarized as follows:

 SCHEDULE OF PROPERTY PLANT AND EQUIPMENT, ESTIMATED USEFUL LIVES

Land Improvements		15 years
Buildings and Improvements		30 years
Furniture, Fixtures and Equipment		10 years

 

Impairment of Long-Lived Assets

 

When circumstances indicate the carrying value of property and equipment may not be recoverable, the Company reviews the property 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 and equipment. Estimated fair value is determined with the assistance from independent valuation specialists using recent sales of similar assets, market conditions or projected cash flows of the property using standard industry valuation techniques.

 

Deferred Loan Costs and Debt Discounts

 

Deferred loan costs are amortized over the life of the related loan using the straight-line method, which approximates the effective interest method. Amortization expense for the years ended December 31, 2023 and 2022 totaled $347,783 and $315,983, respectively. Deferred loan cost amortization is included as a component of interest expense in the consolidated statements of operations.

 

Goodwill

 

Goodwill represents the excess of the cost of an acquired business over the amounts assigned to its net assets. Goodwill is not amortized but is tested for impairment at a reporting unit level on an annual basis or when an event occurs, or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Events or changes in circumstances that may trigger interim impairment reviews include significant changes in business climate, operating results, planned investments in the reporting unit, or an expectation that the carrying amount may not be recoverable, among other factors.

 

The Company may first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events and circumstances, the Company determines it is more likely than not that the fair value of the reporting unit is greater than it’s carrying amount, an impairment test is unnecessary. If an impairment test is necessary, the Company will estimate the fair value of its related reporting units. If the carrying value of a reporting unit exceeds its fair value, the goodwill of that reporting unit is determined to be impaired, and the Company will proceed with recording an impairment charge equal to the excess of the carrying value over the related fair value.

 

F-8

 

The Company has recorded Goodwill in connection with business acquisitions during the year ended December 31, 2020 (see Note 9). During the years ended December 31, 2023 and 2022, the Company recorded no impairment of Goodwill.

 

Revenue Recognition

 

Rent receivables are carried net of an allowance for uncollectible amounts. An allowance is maintained for estimated losses resulting from the inability of certain tenants to meet the contractual obligations under their lease agreements.

 

The Company’s leases may be subject to annual escalations of the minimum monthly rent required under each lease. The accompanying consolidated financial statements reflect rental income on a straight-line basis over the term of each lease. During the year ended December 31, 2023 the Company did not terminate leases that would result in annual escalations.

 

When the lessee is the owner of any improvements, any lessee improvement allowance that is funded by the Company is treated as a lease incentive and amortized as a reduction of revenue over the lease term. As of December 31, 2023, and 2022, there were no deferred lease incentives recorded.

 

The Company recognizes revenue in accordance with ASU 2014-09, “Revenue from Contracts with Customers (Topic 606),” including subsequently issued updates. Under the accounting guidance our revenues are presented net of estimated allowances, and we no longer present the contractual allowance as a separate line item on our balance sheet.

 

The Company reviews its calculations for the realizability of gross service revenues monthly to make certain that we are properly allowing for the uncollectible portion of our gross billings and that our estimates remain sensitive to variances and changes within our payer groups. The contractual allowance calculation is made based on historical allowance rates for the various specific payer groups monthly with a greater emphasis given to current trends. This calculation is routinely analyzed by the Company based on actual allowances issued by payers and the actual payments made to determine what adjustments, if any, are needed.

 

Our revenues generally relate to contracts with patients in which our performance obligations are to provide health care services to the patients. Revenues are recorded during the period our obligations to provide health care services are satisfied. Our performance obligations for inpatient services are generally satisfied over periods that average approximately five days, and revenues are recognized based on charges incurred in relation to total expected charges. The contractual relationships with patients, in most cases, also involve a third-party payer (Medicare, and Medicaid) and the transaction prices for the services provided are dependent upon the terms provided by the third party payer or payers. Medicare generally pays for inpatient and outpatient services at prospectively determined rates based on clinical, diagnostic and other factors. Services provided to patients having Medicaid coverage are generally paid at prospectively determined rates per discharge, per identified service or per covered member.

 

Our revenues are based upon the estimated amounts we expect to be entitled to receive from patients and third-party payers. Estimates of contractual allowances under managed care are based upon the payment terms specified in the related contractual agreements.

 

F-9

 

Laws and regulations governing the Medicare and Medicaid programs are complex and subject to interpretation. Estimated reimbursement amounts are adjusted in subsequent periods as cost reports are prepared and filed and as final settlements are determined. In relation to certain government programs, primarily Medicare, this is generally referred to as the “cost report” filing and settlement process.

 

Allowance for Credit Losses

 

In September 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instrument (“ASU 2016-13”). ASU 2016-13 requires entities to use a forward-looking approach based on current expected credit losses (“CECL”) to estimate credit losses on certain types of financial instruments, including trade receivables. This may result in the earlier recognition of allowances for credit losses. The Company adopted ASU 2016-13 January 1, 2023. We identified trade and ERTC accounts receivable financial instruments that would be impacted by this adoption.

 

As part of the analysis, the Company determined that all trade accounts receivable were of similar risk. Given the economy and our services provided, we determined the trade accounts receivable would not be impacted. The Company recorded an allowance of $1,874,068 as of December 31, 2023. This included fully reserving for receivables greater than 90 days. For the year ended December 31, 2023, the Company recorded $1,475,205 on the statement of operations as a provision for credit losses expense.

 

The CARES Act provides an employee retention credit (“CARES Employee Retention Credit”), which is a refundable tax credit against certain employment taxes of up to $5,000 per employee for eligible employers. The tax credit is equal to 50% of qualified wages paid to employees during a quarter, capped at $10,000 of qualified wages per employee through December 31, 2020. Additional relief provisions were passed by the United States government, which extend and slightly expand the qualified wage caps on these credits through December 31, 2021. Based on these additional provisions, the tax credit is now equal to 70% of qualified wages paid to employees during a quarter, and the limit on qualified wages per employee has been increased to $10,000 of qualified wages per quarter. The Company qualified for the tax credit under the CARES Act for qualified wages for the years ended December 31, 2020 and 2021. In February 2023, the Company submitted filings for CARES Employee Retention Credits totaling $6,866,759. As of December 31, 2023, the Company recorded an employee retention credits receivable of $1,257,952. Upon evaluation of the collectability of this receivable, the Company recorded a full allowance against this receivable and recorded an expense to provision for credit losses on the statement of operations.

 

Stock-Based Compensation

 

The Company accounts for stock-based compensation in accordance with Accounting Standards Codification (“ASC”) ASC 718, “Compensation-Stock Compensation”. ASC 718 requires companies to measure the cost of employee services received in exchange for an award of equity instruments, including stock options, based on the grant-date fair value of the award and to recognize it as compensation expense over the period the employee is required to provide service in exchange for the award, usually the vesting period. During the years ended December 31, 2023 and 2022, the Company incurred $625 and $0, respectively of stock-based compensation.

 

Fair Value Measurements

 

The Company utilizes the methods of fair value measurement as described in ASC 820 to value its financial assets and liabilities. As defined in ASC 820, fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In order to increase consistency and comparability in fair value measurements, ASC 820 establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below:

 

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

 

F-10

 

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.

 

The Company has no financial assets or financial liabilities that are required to be measured at fair value on a recurring basis as of December 31, 2023, and 2022.

 

The carrying values of cash and cash equivalents, accounts payable, accrued liabilities and other short-term debt, approximate their fair value because of the short-term nature of these financial instruments. The carrying value of long-term debt approximates fair value since the related rates of interest approximate current market rates.

 

Upon acquisition of real estate properties, the Company determines the total purchase price of each property and allocates this price based 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 rates from a third-party appraisal or other market sources.

 

Income Taxes

 

As previously disclosed in the “Organization and Description of the Business” section of this Note, the Company’s focus has partially shifted from leasing nursing home assets to independent operators toward owning and operating its real estate assets itself.

 

The Company uses the asset and liability method of accounting for income taxes. Accordingly, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates resulting from new legislation is recognized in income in the period of enactment. A valuation allowance is established against deferred tax assets when management concludes that the “more likely than not” realization criteria has not been met. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained.

 

Income (Loss) Per Common Share

 

Basic earnings per share are based on the weighted-average number of shares of common stock outstanding. FASB ASC Topic 260, “Earnings per Share”, requires the Company to include additional shares in the computation of earnings per share, assuming dilution.

 

Diluted earnings per share are based on the assumption that all dilutive options and warrants were converted or exercised by applying the treasury stock method and that all convertible preferred stock were converted into common shares by applying the if-converted method. Under the treasury stock method, options and warrants are assumed to be exercised at the beginning of the period or at the time of issuance, if later, and as if funds obtained thereby were used to purchase common stock at the average market price during the period. Under the if-converted method, the preferred dividends applicable to convertible preferred stock are added back to the numerator. The convertible preferred stock is assumed to have been converted at the beginning of the period or at time of issuance, if later, and the resulting common shares are included in the denominator.

 

We calculate basic earnings per share by dividing net income attributable to common stockholders (the “numerator”) by the weighted average number of common shares outstanding (the “denominator”) during the reporting period. Diluted earnings per share is calculated similarly but reflects the potential impact of outstanding options, warrants and other commitments to issue common stock, including shares issuable upon the conversion of convertible preferred stock outstanding, except where the impact would be anti-dilutive.

 

F-11

 

The following table sets forth the computation of basic and diluted earnings per share:

 SCHEDULE OF BASIC AND DILUTED EARNINGS PER SHARE

		2023				2022
		Year Ended December 31,
		2023				2022
Numerator for basic earnings per share:
Net Loss Attributable to Selectis Health, Inc.		$	(3,970,982	)		$	(2,395,813	)
Series D Preferred Dividends			(30,000	)			(30,000	)
Net Loss Attributable to Common Stockholders - Basic		$	(4,000,982	)		$	(2,425,813	)
Numerator for diluted earnings per share:
Net Loss Attributable to Common Stockholders			(3,970,982	)			(2,395,813	)
Series D Preferred Dividends			(30,000	)			(30,000	)
Net Loss Attributable to Common Stockholders - Diluted			(4,000,982	)			(2,425,813	)
Denominator for basic earnings per share:
Weighted Average Common Shares Outstanding			3,054,587				3,054,126
Denominator for diluted earnings per share:
Weighted Average Common Shares Outstanding - Basic			3,054,587				3,054,126
Effect of dilutive securities:			-				-
Issuance of stock options			-				-
Exercise of warrants			-				-
Weighted Average Common Shares Outstanding - Diluted			3,054,587				3,054,126
Net Loss per Share Attributable to Common Stockholders:
Basic		$	(1.31	)		$	(0.79	)
Diluted		$	(1.31	)		$	(0.79	)

 

Options to purchase 30,000 shares of common stock were outstanding during the years ended December 31, 2023 and 2022 but were not included in the computation of diluted earnings per share because they are anti-dilutive due to the options’ exercise price being greater than the average market price of the common shares.

 

Recently Issued Accounting Pronouncements

 

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvement to Income Tax Disclosures, amending income tax disclosure requirements for the effective tax rate reconciliation and income taxes paid. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024 and are applied prospectively. Early adoption and retrospective application of the amendments are permitted. We are currently evaluating the impact of this update on our consolidated financial statements and disclosures.

 

The FASB and other entities issued new or modifications to, or interpretations of, existing accounting guidance during 2023. 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. PROPERTY AND EQUIPMENT, NET

 

The gross carrying amount and accumulated depreciation of the Company’s property and equipment as of December 31, 2023 and 2022 are as follows:

 SCHEDULE OF PROPERTY PLANT AND EQUIPMENT

		December 31, 2023				December 31, 2022
Land		$	1,778,250			$	1,778,250
Land Improvements			329,055				329,055
Buildings and Improvements			44,665,656				44,659,921
Furniture, Fixtures and Equipment			2,483,207				2,459,138
Property and Equipment, gross			49,256,168				49,226,364
Less: Accumulated Depreciation			(13,878,450	)			(12,212,251	)
Less: Impairment			(1,560,000	)			(1,560,000	)
Property and Equipment, net		$	33,817,718			$	35,454,113

 

		2023				2022
		Year Ended December 31,
		2023				2022
Depreciation Expense (excluding Intangible Assets)		$	1,666,200			$	1,792,840
Cash Paid for Capital Expenditures		$	29,805			$	222,361

 

F-12

 

3. DEBT AND DEBT – RELATED PARTIES

 

The following is a summary of the Company’s debt and debt – related parties outstanding as of December 31, 2023 and 2022:

 SCHEDULE OF DEBT AND DEBT - RELATED PARTIES

		2023				2022
Senior Secured Promissory Notes		$	1,025,000			$	1,025,000
Senior Secured Promissory Notes - Related Parties			750,000				750,000
Fixed-Rate Mortgage Loans			29,570,185				30,568,677
Variable-Rate Mortgage Loans			4,675,585				4,879,462
Other Debt, Subordinated Secured			741,000				741,000
Other Debt, Subordinated Secured - Related Parties			150,000				150,000
Other Debt, Subordinated Secured - Seller Financing			15,105				56,051
Financed Insurance Premiums			875,027				235,125
Debt and Debt – Related Parties, Gross			37,801,902				38,405,315
Unamortized Discount and Debt Issuance Costs			(555,367	)			(810,997	)
Debt and Debt – Related Parties, Net of Discount		$	37,246,535			$	37,594,318
Debt and Debt – Related Parties, Net of Discount			37,246,536			$	37,594,318
As presented in the Consolidated Balance Sheets:
Current Maturities of Long Term Debt, Net		$	11,170,100			$	2,296,830
Short Term Debt – Related Parties, Net			900,000				900,000
Long-Term Debt, Net			25,176,435				34,397,488
Long-Term Debt - Related Parties, Net

 

The weighted average interest rate and term of our fixed rate debt are 4.15% and 12.16 years, respectively, as of December 31, 2023. The weighted average interest rate and term of our variable rate debt are 5.75% and 14.11 years, respectively, as of December 31, 2023.

 

The weighted average interest rate and term of our fixed rate debt are 3.87% and 12.83 years, respectively, as of December 31, 2022. The weighted average interest rate and term of our variable rate debt are 3.53% and 15.25 years, respectively, as of December 31, 2022.

 

Corporate Senior and Senior Secured Promissory Notes

 

As of December 31, 2023, and December 31, 2022, the senior secured notes are subject to annual interest ranging from 10% to 11% with an original maturity date of October 31, 2021. These notes were extended to June 30, 2023 and as consideration the Company modified the outstanding warrants to extend the life an additional 1.67 years. As a result of the warrant modification, the Company recorded the incremental increase in fair value of $844,425 as a debt discount which will be amortized over the new life of the notes.

 

In 2017, $600,000 in notes were sold and issued, of which $425,000 were to related parties. On 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. For every $10.00 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 $7.50 per share. The warrants have a cashless exercise provision and were valued using the Black-Scholes pricing model. The maturity date of the 120,000 warrants issued along with the notes was extended to December 31, 2018, 225,000 warrants of which occurred in 2018. As of December 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. Effective January 28, 2020, the Company exchanged $100,000 in outstanding senior secured 10% Notes and Warrants that had matured on December 31, 2018 for 11% Senior Secured Promissory Notes and issued 10,000 cashless exercise warrants for purchase of company stock at $5.00, expiring October 31, 2021. As of December 31, 2020, the Company had not renewed or repaid $25,000 in 10% notes with a maturity date of December 31, 2018. While this is technically in default, the Company continues to make interest payments to the noteholder.

 

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 were due in October 2020. For every $10.00 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 $7.50 per share. The warrants have a cashless exercise provision. On September 30, 2020, the Company repaid $150,000 of 10% Senior Unsecured Notes that matured October 31, 2020. Effective October 31, 2020, the Company exchanged $150,000 in outstanding Senior Unsecured 10% Notes and Warrants that had matured on October 31, 2020 for 11% Senior Secured Promissory Notes and issued 15,000 cashless exercise warrants for purchase of the Company’s common stock at $5.00 per share, expiring October 31, 2021.

 

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 one Warrant for each $10.00 in principal amount of Note exercisable for three years to purchase a share of Common Stock at an exercise price of $5.00 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 11,100 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.

 

On January 17, 2020, the Board of Directors agreed to increase the total offering amount and extend the period of its 2018 Offering of 11% Senior Secured Notes. The total amount of the Offering has been increased to $2,500,000 and the offering period will continue until terminated by the Board of Directors. Effective February 5, 2020 and March 3, 2020, the Company completed the sale of $60,000 and $100,000, respectively, of Units in the Offering. The sale of $100,000 Units on March 3, 2020 was to a related party. In connection with the sale of the Units on February 5, 2020 and March 3, 2020, the Company issued 6,000 and 10,000, respectively, cashless exercise warrants for purchase of company stock at $0.50, expiring October 31, 2021. Effective October 31, 2020 the Company completed the exchange of $150,000 of Units in the Offering for matured Senior Unsecured notes. In connection with the exchange of the Units effective October 31, 2020, the Company issued 15,000 cashless exercise warrants for purchase of company stock at $5.00, expiring October 31, 2021. No fees or commissions were paid on the sale of the Units. The proceeds were used for general working capital.

 

Effective June 27, 2023, pursuant to an Allonge and Modification Agreement a Majority in Interest of the senior secured note holders agreed to extend the maturity date of the notes to December 31, 2024, relying upon an Agreement Among Lenders to which all noteholders are a party. As consideration effective July 1, 2023, the annual interest rate increased to 11% and the Company issued a new warrant for every $10 in principal totaling 177,500 of new warrants with an exercise price of $5 and an expiration date of December 31, 2024. As a result of the new warrants, the Company recorded the incremental increase in fair value of $84,352 as a debt discount which is being amortized over the life of the notes.

 

On March 29, 2023, the Company entered into a short-term subordinated secured promissory note of $501,006. This note accrued interest at 6.75% and originally matured on July 5, 2023. The Company extended this note to September 5, 2023, accruing interest at 7.5%. This note and all accrued interest was repaid on September 5, 2023.

 

F-13

 

Mortgage Loans and Lines of Credit Secured by Real Estate

 

Mortgage loans and other debts such as lines of credit 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 a former but no longer related party, or corporate guarantees. Mortgage loans for the periods presented consisted of the following:

 

 SCHEDULE OF MORTGAGE LOAN DEBT

										Total Principal Outstanding as of
State		Number of Properties				Total Face Amount				December 31, 2023				December 31, 2022
Arkansas(1)			1			$	5,000,000			$	3,739,786			$	3,910,767
Georgia(2)			5			$	17,765,992			$	15,457,026			$	16,019,874
Ohio			1			$	3,000,000			$	2,563,000			$	2,649,400
Oklahoma(3)			6			$	13,181,325			$	12,485,958			$	12,868,098
			13			$	38,947,317			$	34,245,770			$	35,448,139

 

(1)	The mortgage loan collateralized by this property 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. Guarantors under the mortgage loan include Christopher Brogdon. Mr. Brogdon has assumed operations of the facility and is making payments of principal and interest on the loan on our behalf in lieu of paying rent on the facility to us, until a formal lease can be put in place. During the years ended December 31, 2023 and 2022, the Company recognized other income of $170,981 and $143,219, respectively for repayments on the loan.
(2)	The Company refinanced two of its mortgages that would have matured in June and October of 2021 amounting to $2,961,167 and $3,289,595, to extend their maturity dates to May 2024 for both.
(3)	The Company refinanced all three mortgages in July 2021, that would have matured in June and July of 2021 amounting to $2,065,969 and $750,000, $500,000, to extend their maturity dates to June 2027 for all three. Additionally, the Company has refinanced the primary mortgage at the Southern Hills Campus, for 35 years at 2.38%.

 

Subordinated, Corporate, and Other Debt

 

Other debt due at December 31, 2023 and 2022 includes unsecured notes payable issued to entities controlled by the Company used to facilitate the acquisition of the nursing home properties.

 SCHEDULE OF OTHER DEBT

						Total Principal Outstanding as of
Property		Face Amount				December 31, 2023				December 31, 2022				Stated Interest Rate		Maturity Date
Goodwill Nursing Home		$	2,030,000			$	741,000			$	741,000			13% Fixed		1-Apr-24
Goodwill Nursing Home – Related Party		$	150,000				150,000				150,000			13% Fixed		30-Nov-25
Higher Call Nursing Center (1)			150,000				15,105				56,051			8% Fixed		1-Apr-24
		$	2,330,000			$	906,105			$	947,051

 

(1)

In connection with the acquisition of Higher Call, the Company executed a promissory note in favor of the Seller, Higher Call Nursing Center, Inc., in the principal amount of $150,000 which accrues interest at the rate of 8% per annum and is payable in equal monthly installments, principal and interest. This note is secured by a corporate guaranty of Global.

 

Our corporate debt at December 31, 2023 and December 31, 2022 includes unsecured notes and notes secured by all assets of the Company not serving as collateral for other notes.

 SCHEDULE OF UNSECURED NOTES AND NOTES SECURED BY ALL ASSETS

						Total Principal Outstanding as of
Series		Face Amount				December 31, 2023				December 31, 2022				Stated Interest Rate		Maturity Date
10% Senior Secured Promissory Notes		$	1,255,000			$	1,025,000			$	1,025,000			10% Fixed		30-Jun-24
10% Senior Secured Promissory Notes – Related Party		$	750,000				750,000				750,000			10% Fixed		31-Dec-24
		$	2,005,000			$	1,775,000			$	1,775,000

 

Cash payments on debt totaled $695,566 and $1,865,458 for the years ended December 31, 2023 and 2022, respectively. Amortization expense for deferred loan costs and debt discounts totaled $347,783 and $315,983 for the years ended December 31, 2023 and 2022, respectively.

 

F-14

 

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

 SCHEDULE OF FUTURE MATURITIES OF NOTES PAYABLE

Year Ending December 31
2024		$	12,625,468
2025			7,579,734
2026			601,466
2027			1,546,429
2028 and Thereafter			15,448,807
Total		$	37,801,903

 

4. OTHER CURRENT LIABILITIES

 

During the year ended December 31, 2021, the Company received an overpayment from Medicare of $931,446 for which the liability was paid in full as of December 31, 2022.

 

5. 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 and does not bear dividends.

 

As of December 31, 2023, and 2022, 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 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 15th 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 December 31, 2023, and 2022, the Company had 375,000 shares of Series D Preferred Stock outstanding.

 

For years ended December 31, 2023, and 2022, the Company declared $30,000 and $30,000 in preferred dividends, respectively. During the years ended December 31, 2023, and 2022, the Company paid $6,900 and $30,000, respectively, for Series D preferred stock dividends. Dividends declared of $7,500 were accrued as of December 31, 2021, were paid in 2022. Declared dividends of $7,500 were accrued as of December 31, 2022 and were paid in 2023.

 

Common Stock

 

The Company’s Board of Directors has authorized 50,000,000 shares of $0.05 par value, Common Stock. As of December 31, 2023, and 2022, the Company has 3,054,587 shares of common stock outstanding, respectively.

 

F-15

 

There were no repurchases performed in the 2023 year.

 

Common Stock Warrants

 

As of December 31, 2023, and December 31, 2022, the Company had 177,500 and 206,000, respectively, of outstanding warrants to purchase common stock at a weighted average exercise price of $5.00 and $5.00, respectively, and weighted average remaining term of 0.5 years and 1.67 years, respectively. The aggregate intrinsic value of common stock warrants outstanding as of December 31, 2023, and December 31, 2022 was $0.

 SCHEDULE OF COMMON STOCK WARRANTS ACTIVITY

		Year Ended December 31,
		2023								2022
		Number of				Weighted Average				Number of				Weighted Average
		Warrants				Exercise Price				Warrants				Exercise Price
Beginning Balance			206,000			$	5.00				206,000			$	5.00
Issued			177,500				-				-				-
Cancelled			-				-				-				-
Exercised			-				-				-				-
Expired			(206,000	)			-				-				-
Ending Balance			177,500			$	5.00				206,000			$	5.00

 

Common Stock Options

 

On January 6, 2022, the Company issued a three-year option to purchase 30,000 shares of our common stock at $6.00 per share. As of December 31, 2023 and December 31, 2022, the Company had a total of 30,000 outstanding options to purchase common stock. The aggregate intrinsic value of common stock options outstanding as of December 31, 2023, and December 31, 2022 was $0.

 SCHEDULE OF COMMON STOCK OPTIONS ACTIVITY 

		Year Ended December 31,
		2023								2022
		Number of				Weighted Average				Number of				Weighted Average
		Options				Exercise Price				Options				Exercise Price
Beginning Balance			30,000			$	6.00				30,000			$	6.00
Issued			-				-				-				-
Cancelled			-				-				-				-
Exercised			-				-				-				-
Expired			-				-				-				-
Ending Balance			30,000			$	6.00				30,000			$	6.00

 

6. FACILITY LEASES

 

The following table summarizes our leasing arrangements related to the Company’s healthcare facilities at December 31, 2023:

 SCHEDULE OF LEASING ARRANGEMENTS

		Monthly				Lease
Facility		Lease Income (1)				Expiration				Renewal Option if Any
Goodwill Hunting LLC(1)		$	52,976				February 1, 2027			Term may be extended for one additional five-year term

 

(1)	The lease became effective on February 1, 2017, and the facility began generating rental revenue thereafter.

 

F-16

 

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 SNF, ALF and ILF, Meadowview, Higher Call, Edwards, Fairland, Sparta, and Warrenton properties.

 

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:

 SCHEDULE OF FUTURE CASH PAYMENTS FOR RENT RECEIVED DURING INITIAL TERM OF LEASE

As of December 31,
2024			643,401
2025			651,954
2026			660,665
2027 and Thereafter			55,116
Total		$	2,011,136

 

7. INCOME TAXES

 

The following is the breakdown of the Company’s income tax expenses:

 SCHEDULE OF INCOME TAX EXPENSES

Income Tax Expense:		2023				2022
Current Federal		$	-			$	-
Current State			-				-
Current Income Tax Expenses			-				-
Deferred Federal			-				-
Deferred State			-				-
Deferred Income Tax Expense			-				-
Total Income Tax Expense			-				-

 

The Company and its subsidiaries are subject to income taxes on income arising in, or derived from, the tax jurisdictions in which they operate. The Company files federal, Alabama, Arkansas, Colorado, Georgia, and Oklahoma income tax returns. The Company is current with all its federal and state tax filings. The 2020 through 2023 tax years generally remain subject to examination by the IRS and various state taxing authorities, although the Company is not currently under examination in any jurisdiction.

 

The following is a reconciliation of the federal statutory tax rate and the effective tax rate as a percentage for the years ended December 31, 2023 and 2022:

 SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION

		2023				2022
Statutory Federal Income Tax Rate			21	%			21	%
Prior Year True-ups			(22	)%			(89	)%
Permanent Difference			33	%			(4	)%
State Taxes			10	%			4	%
Change in Valuation Allowance			(42	)%			68	%
Effective tax rate			-	%			-	%

 

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.

 

The components of deferred tax assets as of December 31, 2023 and 2022 are as follows:

 SCHEDULE OF DEFERRED TAX ASSETS

		2023				2022
Deferred Tax Assets:
Net Operating Loss Carryforwards		$	2,781,168			$	2,296,982
Impairment Loss on Long Term Assets			390,295				393,026
Interest Expense			485,044				-
Bad Debt Allowance			545,768				-
Deferred Tax Assets			4,202,275				2,690,008
Deferred Tax Liabilities:
Property and Equipment			(1,391,332	)			(1,502,934	)
Other			(9,478	)			(8,807	)
Deferred Tax Liabilities			(1,400,810	)			(1,511,741	)
Valuation Allowance			(2,801,465	)			(1,178,267	)
Net Deferred Tax Asset		$	-			$	-

 

F-17

 

The valuation allowance at December 31, 2023 and 2022 was primarily related to federal net operating loss carryforwards that, in the judgment of management, are not more-likely-than-not to be realized. In assessing the realizability of deferred tax assets, management considers whether it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities (including the impact of available carryback and carryforward periods), projected future taxable income, and tax-planning strategies in making this assessment. Based upon the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible, management believes it is more-likely-than-not that the Company will not realize the benefits of these deductible differences, net of the existing valuation allowance at December 31, 2023.

 

As of December 31, 2023 and 2022, the Company has $10,208,276 and $4,223,130 federal net operating losses, among which, if not used, $630,913 and $630,913 would begin to expire starting 2037. The remaining $9,577,363 net operating losses are subject to the 80% taxable income limitation. As of December 31, 2023 and 2022, the Company has $15,670,635 and $10,467,971 state net operating losses

 

When more than a 50% change in ownership occurs, over a three-year period, as defined, the Tax Reform Act of 1986 limits the utilization of net operating loss carry forwards in the years following the change in ownership. In September 2013, the Company had a split-off, in which the business activities changed from gaming casinos into real estate related to long-term care. The Company determined that the pre-2013 net operating losses of $4,047,175 were subject to the limitation set forth under Internal Revenue Code Section 382 and thus wrote off such net operating losses in 2022. No determination has been made regarding whether another ownership change had occurred during 2014 and 2023.

 

We have evaluated whether there were material uncertain tax positions requiring recognition in our financial statements. During the period of 2016 to 2021, the Company had recorded bad debt allowances that should have had been adjusted on income tax returns but were not. Consent from the IRS is needed to change the accounting method on tax treatment of bad debt allowance. As of December 31, 2021, the Company has $1,901,203 bad debt allowance. The Company recognized $0 uncertain tax liability in the calculation of deferred tax assets from NOL. When filing its 2022 income tax return, the Company submitted an application to change the accounting method on bad debt allowance. The company policy is to treat tax-related interest and penalties as income tax expense. As of December 31, 2023, the Company did not identify any other uncertain tax position.

 

The following table summarizes the activity related to the Company’s gross unrecognized tax liabilities:

 SCHEDULE OF UNRECOGNIZED TAX LIABILITIES

		2023				2022
Unrecognized tax liabilities, beginning of the year		$	454,439			$	-
Increase (decrease) related to prior year tax positions			(454,439	)			478,988
Increase (decrease) related to current year tax positions			-				(24,549	)
Unrecognized tax liabilities, end of the year			-				454,439

 

8. GOODWILL

 

Goodwill is tested for impairment at a reporting unit level on an annual basis or when an event occurs, or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. During the years ended December 31, 2023 and 2022, the Company recorded no impairment of Goodwill.

 

Following is a summary of goodwill for the years ended December 31, 2023 and 2022:

 SCHEDULE OF ACTIVITIES IN GOODWILL

Balance, December 31, 2021		$	1,076,908
Goodwill acquired in 2022			-
Balance, December 31, 2022			1,076,908
Goodwill acquired in 2023			-
Balance, December 31, 2023		$	1,076,908

 

F-18

 

9. LEGAL PROCEEDINGS

 

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

 

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, filed in April 2016. 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.

 

Oliphant v. Global Eastman, LLC, et.al., State Court of Cobb County, State of Georgia, Civil Action No. 20-A-3983

 

This is a personal injury lawsuit against various defendants arising out of the death of a patient of the Eastman Healthcare & Rehab Center (the “Facility”). At all relevant times, the Facility was owned by the Company’s wholly owned subsidiary Dodge NH, LLC and leased to Eastman Health & Rehab LLC, an affiliate of Cadence Healthcare, as lease operator. Neither the Company nor any affiliate of the Company had any involvement in patient care at the time of the incident for which complaint was made. The Company relies upon well-settled Georgia law that a landlord has no liability for patient care. The landlord is Dodge NH, LLC. Global Eastman, LLC was not formed as a legal entity during the period of the incident and did not assume the past liabilities as part of the OTA with the receivership of Eastman Healthcare & Rehab LLC which was effective July 1, 2020. Global Eastman LLC was formed on November 21, 2019. Plaintiff has dismissed these claims with prejudice, and the Company has filed a Motion to be awarded attorney’s fees and costs.

 

Lawson v. C.R.M of Warrenton, LLC d/b/a Warrenton Health and Rehab; ATL/WARR, LLC; Selectis Warrenton, LLC, et.al., Superior Court of Warren County, State of Georgia, Civil Action No. 23CV0076.

 

This is a personal injury lawsuit filed on June 14, 2023 against various defendants arising out of the death of a patient of the Warrenton Health and Rehab Facility located in Warren, Georgia (the “Facility”). The Facility is owned by the Company’s wholly-owned subsidiary ATL/Warr, LLC. At all relevant times, the Facility was leased and operated by a third party C.R.M. Warrenton, LLC under an operating lease. Neither the Company nor any affiliate of the Company had any involvement in patient care at the time of the incident for which complaint was made. The Company relies upon well-settled Georgia law that a landlord has no liability for patient care. Subsequent to the patient care complained of the Company entered into an Operations Transfer Agreement with the lease operator and assumed operating control of the Facility through a new subsidiary, Selectis Warrenton, LLC. The Company believes its exposure in this matter is de minimus and has referred the litigation to its insurance company for management.

 

Hines v. Global Abbeville LLC, d/b/a Glen Eagle, et al, Superior Court of Warren County, State of Georgia, Civil Action No.2023-CV-094

 

This is a personal injury lawsuit filed on September 11, 2023 against various defendants arising from injuries several months after being admitted to the Glen Eagle facility. The complaint alleges that the facility was negligent in the care administered to the plaintiff which resulted in the injuries, which the Company denies. The Company has referred the litigation to its insurance company for management and believes that its exposure in this matter is de minimus.

 

Hunter v. Global Abbeville LLC, d/b/a Glen Eagle, et al, State Court of Fulton County, State of Georgia

 

This is a wrongful death lawsuit filed on June 20, 2023 against various defendants alleging negligence that led to the death of the plaintiff’s mother who had been admitted to the facility. The complaint alleges that the plaintiffs deviated from the standard of care that caused injuries that ultimately led to the death of the patient, which the Company denies. The Company has referred the litigation to its insurance company for management and believes that its exposure in this matter is de minimus.

 

 

SIGNATURES

 

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this annual report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

	SELECTIS HEALTH, INC.
Date: October 4, 2024	By:	/s/ Adam Desmond
		Adam Desmond
		Chief Executive Officer

 

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

 

SIGNATURE		TITLE		DATE
/s/ Adam Desmond
Adam Desmond		Director and Chief Executive Officer (Principal Executive Officer)		October 4, 2024
/s/James W Creamer III
James W Creamer III		Chief Financial Officer (Principal Executive Officer)		October 4, 2024
/s/ Clifford Neuman
Clifford Neuman		Director		October 4, 2024
/s/ David J Furstenberg
David J Furstenberg		Director		October 4, 2024

  

 

Exhibit 31.1

 

CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Adam Desmond, Chief Executive Officer, certify that:

 

1.	I have reviewed this Annual Report on Form 10-K/A-1 of Selectis Health, 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):

 

6.	(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: October 4, 2024	/s/ Adam Desmond
	Adam Desmond, Director and Chief Executive Officer
	(Principal Executive Officer)

 

 

 

Exhibit 31.2

 

CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, James W. Creamer, III, Principal Financial Officer, certify that:

 

1.	I have reviewed this Annual Report on Form 10-K/A-1 of Selectis Health, 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: October 4, 2024	/s/ James W. Creamer III
	James W. Creamer III
	Chief Financial Officer (Principal Financial Officer)

 

 

Exhibit 32.1

 

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and in connection with Amendment No. 1 to the Annual Report of Selectis Health, Inc. (the “Company”) on Form 10-K/A-1 for the period ended December 31, 2023, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Adam Desmond, Chief Executive Officer, 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/ Adam Desmond
Adam Desmond
Director and Chief Executive Officer
(Principal Executive Officer)

 

October 4, 2024

 

 

Exhibit 32.2

 

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and in connection with Amendment No. 1 to the Annual Report of Selectis Health, Inc. (the “Company”) on Form 10-K/A-1 for the period ended December 31, 2023, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, James Creamer, Principal Financial Officer, 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.

 

October 4, 2024

 

/s/ James W. Creamer III
James W. Creamer III
Chief Financial Officer (Principal Financial Officer)

 

v3.24.3

Cover - USD ($)	12 Months Ended
	Dec. 31, 2023	Apr. 06, 2024	Jun. 30, 2023
Cover [Abstract]
Document Type	10-K/A
Amendment Flag	true
Amendment Description	This Amendment No.1 to the Annual Report on Form 10-K is being filed solely to furnish the updated financial information in the following sections:   1. Item9A Controls and Procedures to state managements conclusion regarding internal control over financial reporting as of December 31, 2023.   2. Exhibits 32.1 and 32.2 to revised the period ending date from December 31, 2022 to December 31, 2023.
Document Annual Report	true
Document Transition Report	false
Document Period End Date	Dec. 31, 2023
Document Fiscal Period Focus	FY
Document Fiscal Year Focus	2023
Current Fiscal Year End Date	--12-31
Entity File Number	0-15415
Entity Registrant Name	Selectis Health, Inc.
Entity Central Index Key	0000727346
Entity Tax Identification Number	87-0340206
Entity Incorporation, State or Country Code	UT
Entity Address, Address Line One	8480 E Orchard Rd
Entity Address, Address Line Two	Ste 4900
Entity Address, City or Town	Greenwood Village
Entity Address, State or Province	CO
Entity Address, Postal Zip Code	80111
City Area Code	(720)
Local Phone Number	680-0808
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Elected Not To Use the Extended Transition Period	false
Entity Shell Company	false
Entity Public Float			$ 11,275,080
Entity Common Stock, Shares Outstanding		3,067,059
Documents Incorporated by Reference [Text Block]	Exhibits, See Part IV
Document Financial Statement Error Correction [Flag]	false
Auditor Firm ID	688
Auditor Name	Marcum LLP
Auditor Location	Costa Mesa, CA

v3.24.3

Consolidated Balance Sheets - USD ($)	Dec. 31, 2023	Dec. 31, 2022
Current Assets:
Cash and Cash Equivalents	$ 1,484,599	$ 1,420,200
Accounts Receivable, Net	2,091,536	2,904,741
Prepaid Expenses and Other	1,380,570	637,680
Total Current Assets	4,956,705	4,962,621
Long Term Assets:
Restricted Cash	820,124	996,400
Property and Equipment, Net	33,817,718	35,454,113
Goodwill	1,076,908	1,076,908
Total Assets	40,671,455	42,490,042
Liabilities:
Accounts Payable and Accrued Liabilities	6,045,365	3,644,001
Dividends Payable	30,600	7,500
Current Maturities of Long-Term Debt, Net of Discount of $524,704 and $257,222, respectively	11,170,100	2,296,830
Total Current Liabilities	18,146,065	6,848,331
Debt, Net of discount of $30,663 and $0, respectively	25,176,435	34,397,488
Lease Security Deposit	312,750	291,388
Total Liabilities	43,635,250	41,537,207
Commitments and Contingencies
Equity:
Common Stock - $0.05 Par Value; 800,000,000 Shares Authorized, 3,067,059 Shares Issued and Outstanding at December 31, 2023 and December 31, 2022	153,352	152,728
Additional Paid-In Capital	13,852,028	13,768,300
Accumulated Deficit	(17,745,175)	(13,744,193)
Total Equity	(2,963,795)	952,835
Total Liabilities and Equity	40,671,455	42,490,042
Series A Preferred Stock [Member]
Equity:
Preferred stock value	401,000	401,000
Series D Preferred Stock [Member]
Equity:
Preferred stock value	375,000	375,000
Related Party [Member]
Liabilities:
Short term debt – Related Parties,	$ 900,000	$ 900,000

v3.24.3

Consolidated Balance Sheets (Parenthetical) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Long term debt, net of discount, current	$ 524,704	$ 257,222
Long term debt, net of discount, non current	30,663	0
Dividend, preferred stock	$ 30,000	$ 30,000
Preferred stock, shares authorized	10,000,000
Common stock, par value	$ 0.05	$ 0.05
Common stock, shares authorized	800,000,000	800,000,000
Common stock, shares issued	3,067,059	3,067,059
Common stock, shares outstanding	3,067,059	3,067,059
Series A Preferred Stock [Member]
Dividend, preferred stock	$ 0	$ 0
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 Preferred Stock [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
Preferred stock, dividend rate, percentage	8.00%	8.00%

v3.24.3

Consolidated Statements of Operations - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Revenue
Total Revenue	$ 36,783,047	$ 40,599,517
Expenses
Property Taxes, Insurance and Other Operating	31,375,921	29,859,250
General and Administrative	9,968,188	7,869,645
Provision for Credit Losses	2,733,157	1,364,354
Depreciation and Amortization	1,666,200	1,792,840
Total Expenses	45,743,466	40,886,089
Loss from Operations	(8,960,419)	(286,572)
Other (Income) Expense
Loss on Extinguishment of Debt		46,466
Interest Expense, net	2,173,763	2,231,233
Income from Employee Retention Credits	(6,866,759)
Other Income	(296,442)	(168,458)
Total Other Income	(4,989,437)	2,109,241
Net Loss	(3,970,982)	(2,395,813)
Net Loss Attributable to Noncontrolling Interests
Net Loss Attributable to Selectis Health, Inc.	(3,970,982)	(2,395,813)
Series D Preferred Dividends	(30,000)	(30,000)
Net Loss Attributable to Common Stockholders	$ (4,000,982)	$ (2,425,813)
Net Loss per Share Attributable to Common Stockholders:
Basic	$ (1.31)	$ (0.79)
Diluted	$ (1.31)	$ (0.79)
Weighted Average Common Shares Outstanding:
Basic	3,054,587	3,054,126
Diluted	3,054,587	3,054,126
Rental [Member]
Revenue
Total Revenue	$ 634,570	$ 591,808
Health Care [Member]
Revenue
Total Revenue	34,537,723	36,735,683
Healthcare Grant Revenue [Member]
Revenue
Total Revenue	$ 1,610,754	$ 3,272,026

v3.24.3

Consolidated Statements of Changes in Equity - USD ($)	Preferred Stock [Member] Series A Preferred Stock [Member]	Preferred Stock [Member] Series D Preferred Stock [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Total
Balance at Dec. 31, 2021	$ 401,000	$ 375,000	$ 150,168	$ 13,494,394	$ (11,318,380)	$ 3,102,182
Balance, shares at Dec. 31, 2021	200,500	375,000	2,998,361
Series D Preferred Dividends					(30,000)	(30,000)
Common Shares Issued for Debt			$ 2,560	$ 227,440		$ 230,000
Common Shares Issued for Debt, shares			56,226
Loss on Forgiveness of Debt, Net				46,466		46,466
Net Loss					$ (2,395,813)	$ (2,395,813)
Balance at Dec. 31, 2022	$ 401,000	$ 375,000	$ 152,728	13,768,300	(13,744,193)	952,835
Balance, shares at Dec. 31, 2022	200,500	375,000	3,054,587
Series D Preferred Dividends					(30,000)	(30,000)
Net Loss					(3,970,982)	(3,970,982)
Warrants Issued for Debt				84,352		84,352
Common Stock Issued for Services			$ 624	(624)
Common Stock Issued for Services, shares			12,472
Balance at Dec. 31, 2023	$ 401,000	$ 375,000	$ 153,352	$ 13,852,028	$ (17,745,175)	$ (2,963,795)
Balance, shares at Dec. 31, 2023	200,500	375,000	3,067,059

v3.24.3

Consolidated Statements of Cash Flows - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Cash Flows from Operating Activities:
Net Loss	$ (3,970,982)	$ (2,395,813)
Adjustments to reconcile net loss to net cash used in operating activities:
Other Income from Partial Settlement of Debt		(40,436)
Depreciation and Amortization	1,666,200	1,792,840
Amortization of Deferred Loan Costs and Debt Discount	347,783	315,983
Provision for Bad Debt	2,733,157	1,364,354
Stock Issued for Services	624
Changes in Operating Assets and Liabilities:
Accounts and Rents Receivable	(662,000)	(762,376)
Prepaid Expenses and Other Assets	(2,000,842)	1,007,041
Accounts Payable and Accrued Liabilities	2,401,364	(1,648,547)
Lease Security Deposits	21,362	61,806
Cash Provided By (Used in) Operating Activities	536,666	(305,148)
Cash Flows from Investing Activities:
Purchases of Property and Equipment	(29,805)	(222,361)
Cash Used in Investing Activities	(29,805)	(222,361)
Cash Flows from Financing Activities:
Payments on Debt, Non-Related Party	(695,566)	(1,865,458)
Dividends Paid on Preferred Stock	(6,900)	(30,000)
Debt Discount - Warrants RP	83,728	46,466
Cash Used in Financing Activities	(618,738)	(1,848,992)
Net (Decrease) in Cash, Cash Equivalents and Restricted Cash	(111,877)	(2,376,501)
Cash and Cash Equivalents and Restricted Cash at Beginning of the Period	2,416,600	4,793,101
Cash and Cash Equivalents and Restricted Cash at End of the Period	2,304,723	2,416,600
Supplemental Disclosure of Cash Flow Information
Cash Paid for Interest	1,782,489	1,570,520
Cash and Cash Equivalents	1,484,599	1,420,200
Restricted Cash	820,124	996,400
Total Cash and Cash Equivalents and Restricted Cash	2,304,723	2,416,600
Supplemental Schedule of Non-Cash Investing and Financing Activities
Dividends Declared on Series D Preferred Stock	30,000	30,000
Issuance of common stock for cashless exercise of warrants	84,352
Issuance of common stock for debt		230,000
Financing of Insurance Premiums	$ 1,021,676	$ 581,393

v3.24.3

Pay vs Performance Disclosure - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Pay vs Performance Disclosure [Table]
Net Income (Loss)	$ (3,970,982)	$ (2,395,813)

v3.24.3

Insider Trading Arrangements	3 Months Ended
	Dec. 31, 2023
Insider Trading Arrangements [Line Items]
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

v3.24.3

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	12 Months Ended
	Dec. 31, 2023
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   Selectis Health, Inc (“Selectis” or “we” or the “Company”) owns and operates, through wholly-owned subsidiaries Assisted Living Facilities, Independent Living Facilities, and Skilled Nursing Facilities across the South and Southeastern portions of the US. In 2019, the Company shifted from leasing long-term care facilities to third-party, independent operators towards an owner operator model.   Prior to the Company changing its name to Selectis Health, Inc., the Company was known as Global Healthcare REIT, Inc. from September 30, 2013, to May 2021. Prior to this, 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”). WPF was merged into the Company in 2019.   In September 2021, the Company rebranded to Selectis Health, Inc., from Global Healthcare REIT, Inc. to better align with the current and future business model, which is to own and operate its facilities.   The Company acquires, develops, leases and manages healthcare real estate, provide financing to healthcare providers, and provide healthcare operations through our wholly-owned subsidiaries. Our portfolio is comprised of investments in the following healthcare segments: (i) senior housing (including independent and assisted living) and (ii) post-acute/skilled nursing. We will make investments within our healthcare segments using the following six investment products: (i) direct ownership of properties, (ii) debt investments, (iii) developments and redevelopments, (iv) investment management, (v) the Housing and Economic Recovery Act of 2008 (“RIDEA”), which represents investments in senior housing operations utilizing the structure permitted by RIDEA and (xi) owning healthcare operations.   Basis of Presentation   The accompanying consolidated financial statements (the Financial Statements) have been prepared in accordance with accounting principles generally accepted in the United States (GAAP). The Company is the sole member of various consolidated limited liability companies established to operate various acquired skilled nursing operations, senior living operations and related ancillary services. All intercompany transactions and balances have been eliminated in consolidation. The Company presents noncontrolling interests within the equity section of its consolidated balance sheets and the amount of consolidated net income that is attributable to Selectis Health, Inc. and the noncontrolling interest in its consolidated statements of operations.   The consolidated financial statements include the accounts of all entities controlled by the Company through its ownership of a majority voting interest.   Use of Estimates and Assumptions   The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP” or “GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant estimates included herein relate to the recoverability of assets, the purchase price allocation for properties acquired, and the fair value of certain assets and liabilities. Actual results may differ from estimates.   Management’s Liquidity Plans   On August 27, 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-05, Disclosure of Uncertainties about an Entity’s ability to Continue as a Going Concern, which requires management to assess a company’s ability to continue as a going concern within one year from financial statement issuance and to provide related footnote disclosures in certain circumstances.   For the year ended December 31, 2023 the Company had positive operating cash flows of $0.5 million and a net working capital deficit of $13.2 million. Management is unsure that it will be able to meet its obligations in the next twelve months from the date of these financial statements. This is, in part due to a $11,170,100 in current maturities of our long-term debt occurring during 2024, and that there are no assurances that the Company will be able to refinance these loans. Based on management’s projections of continued operating losses, there is substantial doubt that the Company can generate positive cashflows from its continued operations.     Management’s plan to address the Company’s liquidity issues includes, focusing on improving occupancy rates at our facilities to bolster revenues, implementing cost cutting measures at both the facility and corporate level, working with our lenders to extend mortgages and notes that are maturing, and selling off key, underperforming properties to improve our cash flow.   These actions should alleviate any substantial doubt about the Company’s ability to continue as a going concern as defined by ASU 2014-05. However, we cannot predict, with certainty, the outcome of our actions to generate liquidity and the failure to do so could negatively impact our future operations.   Cash and Cash Equivalents   The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.   Restricted Cash   Restricted cash consisted of the following as of December 31:  SCHEDULE OF RESTRICTED CASH AND CASH EQUIVALENTS     2023     2022                     Funds held in escrow under the terms of notes for future capital expenditures, repairs and maintenance   $ 820,124     $ 996,400     Concentration of Credit Risk   The Company maintains deposits in financial institutions that at times exceed the insured amount of $250,000 provided by the U.S. Federal Deposit Insurance Corporation (FDIC). The Company went to an Insured Cash Sweep service (ICS) in 2021. ICS funds are eligible for multi-million-dollar FDIC insurance that’s backed by the full faith and credit of the United States government. Daily cash is swept and deposited to as many banks as needed that are FDIC insured. This insures no amounts exceed a $250,000 balance which is fully insured by the FDIC. The funds can be tracked by its primary financial institution. New funds can be deposited and withdrawn from that single relationship. The Company believes the financial institutions it uses are credit worthy and stable. The Company does not believe that it is exposed to any significant credit risk in cash and cash equivalents or restricted cash.   Property and Equipment   In accordance with purchase accounting guidance established for entities under common control, the property and equipment acquired from entities under common control are stated at their carrying value on the date of acquisition. Property and equipment not acquired from entities under common control is recorded at its estimated fair value. Estimated fair value is determined with the assistance from independent valuation specialists using recent sales of similar assets, market conditions or projected cash flows of properties using standard industry valuation techniques.   Upon acquisition of real estate properties determined to be asset acquisitions, the Company determines the total purchase price of each property and allocates the purchase price of acquired properties to net tangible and identified intangible assets based on relative fair values. Fair value estimates are based on information obtained from independent appraisals, other market data, and information obtained during due diligence period. Acquisition-related costs such as due diligence, legal and accounting fees are included in the purchase price. Initial valuations are subject to change during the measurement period, but the period ends as soon as the information is available. The measurement period shall not exceed one year from the date of acquisition.     Upon acquisition of business entities and real estate determined to be a business combination, the Company identifies and recognizes the net tangible and identified intangible assets based on fair values, and net assets as goodwill or gain on bargain purchase. 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, leasing, and or operating at the specific property. Acquisition-related costs such as due diligence, legal and accounting fees are expensed as incurred. Initial valuations are subject to change during the measurement period, but the period ends as soon as the information is available. The measurement period shall not exceed one year from the date of acquisition.   Any subsequent betterments and improvements are stated at historical cost. Depreciation is provided using the straight-line method over the estimated useful lives of the assets, and tenant improvements are depreciated over the remaining term of the lease. Useful lives of the assets are summarized as follows:  SCHEDULE OF PROPERTY PLANT AND EQUIPMENT, ESTIMATED USEFUL LIVES Land Improvements   15 years Buildings and Improvements   30 years Furniture, Fixtures and Equipment   10 years   Impairment of Long-Lived Assets   When circumstances indicate the carrying value of property and equipment may not be recoverable, the Company reviews the property 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 and equipment. Estimated fair value is determined with the assistance from independent valuation specialists using recent sales of similar assets, market conditions or projected cash flows of the property using standard industry valuation techniques.   Deferred Loan Costs and Debt Discounts   Deferred loan costs are amortized over the life of the related loan using the straight-line method, which approximates the effective interest method. Amortization expense for the years ended December 31, 2023 and 2022 totaled $347,783 and $315,983, respectively. Deferred loan cost amortization is included as a component of interest expense in the consolidated statements of operations.   Goodwill   Goodwill represents the excess of the cost of an acquired business over the amounts assigned to its net assets. Goodwill is not amortized but is tested for impairment at a reporting unit level on an annual basis or when an event occurs, or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Events or changes in circumstances that may trigger interim impairment reviews include significant changes in business climate, operating results, planned investments in the reporting unit, or an expectation that the carrying amount may not be recoverable, among other factors.   The Company may first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events and circumstances, the Company determines it is more likely than not that the fair value of the reporting unit is greater than it’s carrying amount, an impairment test is unnecessary. If an impairment test is necessary, the Company will estimate the fair value of its related reporting units. If the carrying value of a reporting unit exceeds its fair value, the goodwill of that reporting unit is determined to be impaired, and the Company will proceed with recording an impairment charge equal to the excess of the carrying value over the related fair value.     The Company has recorded Goodwill in connection with business acquisitions during the year ended December 31, 2020 (see Note 9). During the years ended December 31, 2023 and 2022, the Company recorded no impairment of Goodwill.   Revenue Recognition   Rent receivables are carried net of an allowance for uncollectible amounts. An allowance is maintained for estimated losses resulting from the inability of certain tenants to meet the contractual obligations under their lease agreements.   The Company’s leases may be subject to annual escalations of the minimum monthly rent required under each lease. The accompanying consolidated financial statements reflect rental income on a straight-line basis over the term of each lease. During the year ended December 31, 2023 the Company did not terminate leases that would result in annual escalations.   When the lessee is the owner of any improvements, any lessee improvement allowance that is funded by the Company is treated as a lease incentive and amortized as a reduction of revenue over the lease term. As of December 31, 2023, and 2022, there were no deferred lease incentives recorded.   The Company recognizes revenue in accordance with ASU 2014-09, “Revenue from Contracts with Customers (Topic 606),” including subsequently issued updates. Under the accounting guidance our revenues are presented net of estimated allowances, and we no longer present the contractual allowance as a separate line item on our balance sheet.   The Company reviews its calculations for the realizability of gross service revenues monthly to make certain that we are properly allowing for the uncollectible portion of our gross billings and that our estimates remain sensitive to variances and changes within our payer groups. The contractual allowance calculation is made based on historical allowance rates for the various specific payer groups monthly with a greater emphasis given to current trends. This calculation is routinely analyzed by the Company based on actual allowances issued by payers and the actual payments made to determine what adjustments, if any, are needed.   Our revenues generally relate to contracts with patients in which our performance obligations are to provide health care services to the patients. Revenues are recorded during the period our obligations to provide health care services are satisfied. Our performance obligations for inpatient services are generally satisfied over periods that average approximately five days, and revenues are recognized based on charges incurred in relation to total expected charges. The contractual relationships with patients, in most cases, also involve a third-party payer (Medicare, and Medicaid) and the transaction prices for the services provided are dependent upon the terms provided by the third party payer or payers. Medicare generally pays for inpatient and outpatient services at prospectively determined rates based on clinical, diagnostic and other factors. Services provided to patients having Medicaid coverage are generally paid at prospectively determined rates per discharge, per identified service or per covered member.   Our revenues are based upon the estimated amounts we expect to be entitled to receive from patients and third-party payers. Estimates of contractual allowances under managed care are based upon the payment terms specified in the related contractual agreements.     Laws and regulations governing the Medicare and Medicaid programs are complex and subject to interpretation. Estimated reimbursement amounts are adjusted in subsequent periods as cost reports are prepared and filed and as final settlements are determined. In relation to certain government programs, primarily Medicare, this is generally referred to as the “cost report” filing and settlement process.   Allowance for Credit Losses   In September 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instrument (“ASU 2016-13”). ASU 2016-13 requires entities to use a forward-looking approach based on current expected credit losses (“CECL”) to estimate credit losses on certain types of financial instruments, including trade receivables. This may result in the earlier recognition of allowances for credit losses. The Company adopted ASU 2016-13 January 1, 2023. We identified trade and ERTC accounts receivable financial instruments that would be impacted by this adoption.   As part of the analysis, the Company determined that all trade accounts receivable were of similar risk. Given the economy and our services provided, we determined the trade accounts receivable would not be impacted. The Company recorded an allowance of $1,874,068 as of December 31, 2023. This included fully reserving for receivables greater than 90 days. For the year ended December 31, 2023, the Company recorded $1,475,205 on the statement of operations as a provision for credit losses expense.   The CARES Act provides an employee retention credit (“CARES Employee Retention Credit”), which is a refundable tax credit against certain employment taxes of up to $5,000 per employee for eligible employers. The tax credit is equal to 50% of qualified wages paid to employees during a quarter, capped at $10,000 of qualified wages per employee through December 31, 2020. Additional relief provisions were passed by the United States government, which extend and slightly expand the qualified wage caps on these credits through December 31, 2021. Based on these additional provisions, the tax credit is now equal to 70% of qualified wages paid to employees during a quarter, and the limit on qualified wages per employee has been increased to $10,000 of qualified wages per quarter. The Company qualified for the tax credit under the CARES Act for qualified wages for the years ended December 31, 2020 and 2021. In February 2023, the Company submitted filings for CARES Employee Retention Credits totaling $6,866,759. As of December 31, 2023, the Company recorded an employee retention credits receivable of $1,257,952. Upon evaluation of the collectability of this receivable, the Company recorded a full allowance against this receivable and recorded an expense to provision for credit losses on the statement of operations.   Stock-Based Compensation   The Company accounts for stock-based compensation in accordance with Accounting Standards Codification (“ASC”) ASC 718, “Compensation-Stock Compensation”. ASC 718 requires companies to measure the cost of employee services received in exchange for an award of equity instruments, including stock options, based on the grant-date fair value of the award and to recognize it as compensation expense over the period the employee is required to provide service in exchange for the award, usually the vesting period. During the years ended December 31, 2023 and 2022, the Company incurred $625 and $0, respectively of stock-based compensation.   Fair Value Measurements   The Company utilizes the methods of fair value measurement as described in ASC 820 to value its financial assets and liabilities. As defined in ASC 820, fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In order to increase consistency and comparability in fair value measurements, ASC 820 establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below:   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.   The Company has no financial assets or financial liabilities that are required to be measured at fair value on a recurring basis as of December 31, 2023, and 2022.   The carrying values of cash and cash equivalents, accounts payable, accrued liabilities and other short-term debt, approximate their fair value because of the short-term nature of these financial instruments. The carrying value of long-term debt approximates fair value since the related rates of interest approximate current market rates.   Upon acquisition of real estate properties, the Company determines the total purchase price of each property and allocates this price based 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 rates from a third-party appraisal or other market sources.   Income Taxes   As previously disclosed in the “Organization and Description of the Business” section of this Note, the Company’s focus has partially shifted from leasing nursing home assets to independent operators toward owning and operating its real estate assets itself.   The Company uses the asset and liability method of accounting for income taxes. Accordingly, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates resulting from new legislation is recognized in income in the period of enactment. A valuation allowance is established against deferred tax assets when management concludes that the “more likely than not” realization criteria has not been met. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained.   Income (Loss) Per Common Share   Basic earnings per share are based on the weighted-average number of shares of common stock outstanding. FASB ASC Topic 260, “Earnings per Share”, requires the Company to include additional shares in the computation of earnings per share, assuming dilution.   Diluted earnings per share are based on the assumption that all dilutive options and warrants were converted or exercised by applying the treasury stock method and that all convertible preferred stock were converted into common shares by applying the if-converted method. Under the treasury stock method, options and warrants are assumed to be exercised at the beginning of the period or at the time of issuance, if later, and as if funds obtained thereby were used to purchase common stock at the average market price during the period. Under the if-converted method, the preferred dividends applicable to convertible preferred stock are added back to the numerator. The convertible preferred stock is assumed to have been converted at the beginning of the period or at time of issuance, if later, and the resulting common shares are included in the denominator.   We calculate basic earnings per share by dividing net income attributable to common stockholders (the “numerator”) by the weighted average number of common shares outstanding (the “denominator”) during the reporting period. Diluted earnings per share is calculated similarly but reflects the potential impact of outstanding options, warrants and other commitments to issue common stock, including shares issuable upon the conversion of convertible preferred stock outstanding, except where the impact would be anti-dilutive.     The following table sets forth the computation of basic and diluted earnings per share:  SCHEDULE OF BASIC AND DILUTED EARNINGS PER SHARE     2023     2022       Year Ended December 31,       2023     2022   Numerator for basic earnings per share:                 Net Loss Attributable to Selectis Health, Inc.   $ (3,970,982 )   $ (2,395,813 ) Series D Preferred Dividends     (30,000 )     (30,000 ) Net Loss Attributable to Common Stockholders - Basic   $ (4,000,982 )   $ (2,425,813 )                   Numerator for diluted earnings per share:                 Net Loss Attributable to Common Stockholders     (3,970,982 )     (2,395,813 ) Series D Preferred Dividends     (30,000 )     (30,000 ) Net Loss Attributable to Common Stockholders - Diluted     (4,000,982 )     (2,425,813 )                   Denominator for basic earnings per share:                 Weighted Average Common Shares Outstanding     3,054,587       3,054,126                     Denominator for diluted earnings per share:                 Weighted Average Common Shares Outstanding - Basic     3,054,587       3,054,126   Effect of dilutive securities:     -       -   Issuance of stock options     -       -   Exercise of warrants     -       -   Weighted Average Common Shares Outstanding - Diluted     3,054,587       3,054,126                     Net Loss per Share Attributable to Common Stockholders:                 Basic   $ (1.31 )   $ (0.79 ) Diluted   $ (1.31 )   $ (0.79 )   Options to purchase 30,000 shares of common stock were outstanding during the years ended December 31, 2023 and 2022 but were not included in the computation of diluted earnings per share because they are anti-dilutive due to the options’ exercise price being greater than the average market price of the common shares.   Recently Issued Accounting Pronouncements   In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvement to Income Tax Disclosures, amending income tax disclosure requirements for the effective tax rate reconciliation and income taxes paid. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024 and are applied prospectively. Early adoption and retrospective application of the amendments are permitted. We are currently evaluating the impact of this update on our consolidated financial statements and disclosures.   The FASB and other entities issued new or modifications to, or interpretations of, existing accounting guidance during 2023. 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.

v3.24.3

PROPERTY AND EQUIPMENT, NET	12 Months Ended
	Dec. 31, 2023
Property, Plant and Equipment [Abstract]
PROPERTY AND EQUIPMENT, NET	2. PROPERTY AND EQUIPMENT, NET   The gross carrying amount and accumulated depreciation of the Company’s property and equipment as of December 31, 2023 and 2022 are as follows:  SCHEDULE OF PROPERTY PLANT AND EQUIPMENT     December 31, 2023     December 31, 2022                 Land   $ 1,778,250     $ 1,778,250   Land Improvements     329,055       329,055   Buildings and Improvements     44,665,656       44,659,921   Furniture, Fixtures and Equipment     2,483,207       2,459,138   Property and Equipment, gross     49,256,168       49,226,364                     Less: Accumulated Depreciation     (13,878,450 )     (12,212,251 ) Less: Impairment     (1,560,000 )     (1,560,000 )                   Property and Equipment, net   $ 33,817,718     $ 35,454,113         2023     2022       Year Ended December 31,       2023     2022                 Depreciation Expense (excluding Intangible Assets)   $ 1,666,200     $ 1,792,840                     Cash Paid for Capital Expenditures   $ 29,805     $ 222,361

v3.24.3

DEBT AND DEBT – RELATED PARTIES	12 Months Ended
	Dec. 31, 2023
Debt Disclosure [Abstract]
DEBT AND DEBT – RELATED PARTIES	3. DEBT AND DEBT – RELATED PARTIES   The following is a summary of the Company’s debt and debt – related parties outstanding as of December 31, 2023 and 2022:  SCHEDULE OF DEBT AND DEBT - RELATED PARTIES     2023     2022                 Senior Secured Promissory Notes   $ 1,025,000     $ 1,025,000   Senior Secured Promissory Notes - Related Parties     750,000       750,000   Fixed-Rate Mortgage Loans     29,570,185       30,568,677   Variable-Rate Mortgage Loans     4,675,585       4,879,462   Other Debt, Subordinated Secured     741,000       741,000   Other Debt, Subordinated Secured - Related Parties     150,000       150,000   Other Debt, Subordinated Secured - Seller Financing     15,105       56,051   Financed Insurance Premiums     875,027       235,125   Debt and Debt – Related Parties, Gross     37,801,902       38,405,315   Unamortized Discount and Debt Issuance Costs     (555,367 )     (810,997 ) Debt and Debt – Related Parties, Net of Discount   $ 37,246,535     $ 37,594,318   Debt and Debt – Related Parties, Net of Discount     37,246,536     $ 37,594,318                     As presented in the Consolidated Balance Sheets:                                   Current Maturities of Long Term Debt, Net   $ 11,170,100     $ 2,296,830   Short Term Debt – Related Parties, Net     900,000       900,000   Long-Term Debt, Net     25,176,435       34,397,488   Long-Term Debt - Related Parties, Net                   The weighted average interest rate and term of our fixed rate debt are 4.15% and 12.16 years, respectively, as of December 31, 2023. The weighted average interest rate and term of our variable rate debt are 5.75% and 14.11 years, respectively, as of December 31, 2023.   The weighted average interest rate and term of our fixed rate debt are 3.87% and 12.83 years, respectively, as of December 31, 2022. The weighted average interest rate and term of our variable rate debt are 3.53% and 15.25 years, respectively, as of December 31, 2022.   Corporate Senior and Senior Secured Promissory Notes   As of December 31, 2023, and December 31, 2022, the senior secured notes are subject to annual interest ranging from 10% to 11% with an original maturity date of October 31, 2021. These notes were extended to June 30, 2023 and as consideration the Company modified the outstanding warrants to extend the life an additional 1.67 years. As a result of the warrant modification, the Company recorded the incremental increase in fair value of $844,425 as a debt discount which will be amortized over the new life of the notes.   In 2017, $600,000 in notes were sold and issued, of which $425,000 were to related parties. On 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. For every $10.00 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 $7.50 per share. The warrants have a cashless exercise provision and were valued using the Black-Scholes pricing model. The maturity date of the 120,000 warrants issued along with the notes was extended to December 31, 2018, 225,000 warrants of which occurred in 2018. As of December 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. Effective January 28, 2020, the Company exchanged $100,000 in outstanding senior secured 10% Notes and Warrants that had matured on December 31, 2018 for 11% Senior Secured Promissory Notes and issued 10,000 cashless exercise warrants for purchase of company stock at $5.00, expiring October 31, 2021. As of December 31, 2020, the Company had not renewed or repaid $25,000 in 10% notes with a maturity date of December 31, 2018. While this is technically in default, the Company continues to make interest payments to the noteholder.   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 were due in October 2020. For every $10.00 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 $7.50 per share. The warrants have a cashless exercise provision. On September 30, 2020, the Company repaid $150,000 of 10% Senior Unsecured Notes that matured October 31, 2020. Effective October 31, 2020, the Company exchanged $150,000 in outstanding Senior Unsecured 10% Notes and Warrants that had matured on October 31, 2020 for 11% Senior Secured Promissory Notes and issued 15,000 cashless exercise warrants for purchase of the Company’s common stock at $5.00 per share, expiring October 31, 2021.   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 one Warrant for each $10.00 in principal amount of Note exercisable for three years to purchase a share of Common Stock at an exercise price of $5.00 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 11,100 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.   On January 17, 2020, the Board of Directors agreed to increase the total offering amount and extend the period of its 2018 Offering of 11% Senior Secured Notes. The total amount of the Offering has been increased to $2,500,000 and the offering period will continue until terminated by the Board of Directors. Effective February 5, 2020 and March 3, 2020, the Company completed the sale of $60,000 and $100,000, respectively, of Units in the Offering. The sale of $100,000 Units on March 3, 2020 was to a related party. In connection with the sale of the Units on February 5, 2020 and March 3, 2020, the Company issued 6,000 and 10,000, respectively, cashless exercise warrants for purchase of company stock at $0.50, expiring October 31, 2021. Effective October 31, 2020 the Company completed the exchange of $150,000 of Units in the Offering for matured Senior Unsecured notes. In connection with the exchange of the Units effective October 31, 2020, the Company issued 15,000 cashless exercise warrants for purchase of company stock at $5.00, expiring October 31, 2021. No fees or commissions were paid on the sale of the Units. The proceeds were used for general working capital.   Effective June 27, 2023, pursuant to an Allonge and Modification Agreement a Majority in Interest of the senior secured note holders agreed to extend the maturity date of the notes to December 31, 2024, relying upon an Agreement Among Lenders to which all noteholders are a party. As consideration effective July 1, 2023, the annual interest rate increased to 11% and the Company issued a new warrant for every $10 in principal totaling 177,500 of new warrants with an exercise price of $5 and an expiration date of December 31, 2024. As a result of the new warrants, the Company recorded the incremental increase in fair value of $84,352 as a debt discount which is being amortized over the life of the notes.   On March 29, 2023, the Company entered into a short-term subordinated secured promissory note of $501,006. This note accrued interest at 6.75% and originally matured on July 5, 2023. The Company extended this note to September 5, 2023, accruing interest at 7.5%. This note and all accrued interest was repaid on September 5, 2023.     Mortgage Loans and Lines of Credit Secured by Real Estate   Mortgage loans and other debts such as lines of credit 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 a former but no longer related party, or corporate guarantees. Mortgage loans for the periods presented consisted of the following:    SCHEDULE OF MORTGAGE LOAN DEBT                 Total Principal Outstanding as of   State   Number of Properties     Total Face Amount     December 31, 2023     December 31, 2022   Arkansas(1)     1     $ 5,000,000     $ 3,739,786     $ 3,910,767   Georgia(2)     5     $ 17,765,992     $ 15,457,026     $ 16,019,874   Ohio     1     $ 3,000,000     $ 2,563,000     $ 2,649,400   Oklahoma(3)     6     $ 13,181,325     $ 12,485,958     $ 12,868,098         13     $ 38,947,317     $ 34,245,770     $ 35,448,139     (1) The mortgage loan collateralized by this property 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. Guarantors under the mortgage loan include Christopher Brogdon. Mr. Brogdon has assumed operations of the facility and is making payments of principal and interest on the loan on our behalf in lieu of paying rent on the facility to us, until a formal lease can be put in place. During the years ended December 31, 2023 and 2022, the Company recognized other income of $170,981 and $143,219, respectively for repayments on the loan.     (2) The Company refinanced two of its mortgages that would have matured in June and October of 2021 amounting to $2,961,167 and $3,289,595, to extend their maturity dates to May 2024 for both.     (3) The Company refinanced all three mortgages in July 2021, that would have matured in June and July of 2021 amounting to $2,065,969 and $750,000, $500,000, to extend their maturity dates to June 2027 for all three. Additionally, the Company has refinanced the primary mortgage at the Southern Hills Campus, for 35 years at 2.38%.   Subordinated, Corporate, and Other Debt   Other debt due at December 31, 2023 and 2022 includes unsecured notes payable issued to entities controlled by the Company used to facilitate the acquisition of the nursing home properties.  SCHEDULE OF OTHER DEBT           Total Principal Outstanding as of           Property   Face Amount     December 31, 2023     December 31, 2022     Stated Interest Rate   Maturity Date Goodwill Nursing Home   $ 2,030,000     $ 741,000     $ 741,000     13% Fixed   1-Apr-24 Goodwill Nursing Home – Related Party   $ 150,000       150,000       150,000     13% Fixed   30-Nov-25 Higher Call Nursing Center (1)     150,000       15,105       56,051     8% Fixed   1-Apr-24     $ 2,330,000     $ 906,105     $ 947,051             (1) In connection with the acquisition of Higher Call, the Company executed a promissory note in favor of the Seller, Higher Call Nursing Center, Inc., in the principal amount of $150,000 which accrues interest at the rate of 8% per annum and is payable in equal monthly installments, principal and interest. This note is secured by a corporate guaranty of Global.   Our corporate debt at December 31, 2023 and December 31, 2022 includes unsecured notes and notes secured by all assets of the Company not serving as collateral for other notes.  SCHEDULE OF UNSECURED NOTES AND NOTES SECURED BY ALL ASSETS           Total Principal Outstanding as of           Series   Face Amount     December 31, 2023     December 31, 2022     Stated Interest Rate   Maturity Date 10% Senior Secured Promissory Notes   $ 1,255,000     $ 1,025,000     $ 1,025,000     10% Fixed   30-Jun-24 10% Senior Secured Promissory Notes – Related Party   $ 750,000       750,000       750,000     10% Fixed   31-Dec-24     $ 2,005,000     $ 1,775,000     $ 1,775,000             Cash payments on debt totaled $695,566 and $1,865,458 for the years ended December 31, 2023 and 2022, respectively. Amortization expense for deferred loan costs and debt discounts totaled $347,783 and $315,983 for the years ended December 31, 2023 and 2022, respectively.     Future maturities and principal payments of all notes payable listed above for the next five years and thereafter are as follows:  SCHEDULE OF FUTURE MATURITIES OF NOTES PAYABLE Year Ending December 31       2024   $ 12,625,468   2025     7,579,734   2026     601,466   2027     1,546,429   2028 and Thereafter     15,448,807             Total   $ 37,801,903

v3.24.3

OTHER CURRENT LIABILITIES	12 Months Ended
	Dec. 31, 2023
Other Liabilities Disclosure [Abstract]
OTHER CURRENT LIABILITIES	4. OTHER CURRENT LIABILITIES   During the year ended December 31, 2021, the Company received an overpayment from Medicare of $931,446 for which the liability was paid in full as of December 31, 2022.

v3.24.3

STOCKHOLDERS’ EQUITY	12 Months Ended
	Dec. 31, 2023
Equity [Abstract]
STOCKHOLDERS’ EQUITY	5. 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 and does not bear dividends.   As of December 31, 2023, and 2022, 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 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 15th 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 December 31, 2023, and 2022, the Company had 375,000 shares of Series D Preferred Stock outstanding.   For years ended December 31, 2023, and 2022, the Company declared $30,000 and $30,000 in preferred dividends, respectively. During the years ended December 31, 2023, and 2022, the Company paid $6,900 and $30,000, respectively, for Series D preferred stock dividends. Dividends declared of $7,500 were accrued as of December 31, 2021, were paid in 2022. Declared dividends of $7,500 were accrued as of December 31, 2022 and were paid in 2023.   Common Stock   The Company’s Board of Directors has authorized 50,000,000 shares of $0.05 par value, Common Stock. As of December 31, 2023, and 2022, the Company has 3,054,587 shares of common stock outstanding, respectively.     There were no repurchases performed in the 2023 year.   Common Stock Warrants   As of December 31, 2023, and December 31, 2022, the Company had 177,500 and 206,000, respectively, of outstanding warrants to purchase common stock at a weighted average exercise price of $5.00 and $5.00, respectively, and weighted average remaining term of 0.5 years and 1.67 years, respectively. The aggregate intrinsic value of common stock warrants outstanding as of December 31, 2023, and December 31, 2022 was $0.  SCHEDULE OF COMMON STOCK WARRANTS ACTIVITY     Year Ended December 31,       2023     2022       Number of     Weighted Average     Number of     Weighted Average       Warrants     Exercise Price     Warrants     Exercise Price                             Beginning Balance     206,000     $ 5.00       206,000     $ 5.00   Issued     177,500       -       -       -   Cancelled     -       -       -       -   Exercised     -       -       -       -   Expired     (206,000 )     -       -       -                                     Ending Balance     177,500     $ 5.00       206,000     $ 5.00     Common Stock Options   On January 6, 2022, the Company issued a three-year option to purchase 30,000 shares of our common stock at $6.00 per share. As of December 31, 2023 and December 31, 2022, the Company had a total of 30,000 outstanding options to purchase common stock. The aggregate intrinsic value of common stock options outstanding as of December 31, 2023, and December 31, 2022 was $0.  SCHEDULE OF COMMON STOCK OPTIONS ACTIVITY      Year Ended December 31,       2023     2022       Number of     Weighted Average     Number of     Weighted Average       Options     Exercise Price     Options     Exercise Price                             Beginning Balance     30,000     $ 6.00       30,000     $ 6.00   Issued     -       -       -       -   Cancelled     -       -       -       -   Exercised     -       -       -       -   Expired     -       -       -       -                                     Ending Balance     30,000     $ 6.00       30,000     $ 6.00

v3.24.3

FACILITY LEASES	12 Months Ended
	Dec. 31, 2023
Facility Leases
FACILITY LEASES	6. FACILITY LEASES   The following table summarizes our leasing arrangements related to the Company’s healthcare facilities at December 31, 2023:  SCHEDULE OF LEASING ARRANGEMENTS     Monthly     Lease       Facility   Lease Income (1)     Expiration     Renewal Option if Any                       Goodwill Hunting LLC(1)   $ 52,976       February 1, 2027     Term may be extended for one additional five-year term   (1) The lease became effective on February 1, 2017, and the facility began generating rental revenue thereafter.     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 SNF, ALF and ILF, Meadowview, Higher Call, Edwards, Fairland, Sparta, and Warrenton properties.   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:  SCHEDULE OF FUTURE CASH PAYMENTS FOR RENT RECEIVED DURING INITIAL TERM OF LEASE As of December 31,       2024     643,401   2025     651,954   2026     660,665   2027 and Thereafter     55,116             Total   $ 2,011,136

v3.24.3

INCOME TAXES	12 Months Ended
	Dec. 31, 2023
Income Tax Disclosure [Abstract]
INCOME TAXES	7. INCOME TAXES   The following is the breakdown of the Company’s income tax expenses:  SCHEDULE OF INCOME TAX EXPENSES Income Tax Expense:   2023     2022   Current Federal   $        -     $ -   Current State     -                -   Current Income Tax Expenses     -       -   Deferred Federal     -       -   Deferred State     -       -   Deferred Income Tax Expense     -       -   Total Income Tax Expense     -       -     The Company and its subsidiaries are subject to income taxes on income arising in, or derived from, the tax jurisdictions in which they operate. The Company files federal, Alabama, Arkansas, Colorado, Georgia, and Oklahoma income tax returns. The Company is current with all its federal and state tax filings. The 2020 through 2023 tax years generally remain subject to examination by the IRS and various state taxing authorities, although the Company is not currently under examination in any jurisdiction.   The following is a reconciliation of the federal statutory tax rate and the effective tax rate as a percentage for the years ended December 31, 2023 and 2022:  SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION     2023           2022                                 Statutory Federal Income Tax Rate     21 %     21 % Prior Year True-ups     (22 )%     (89 )% Permanent Difference                    33 %     (4 )% State Taxes     10 %     4 % Change in Valuation Allowance     (42 )%     68 % Effective tax rate     - %     - %   Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.   The components of deferred tax assets as of December 31, 2023 and 2022 are as follows:  SCHEDULE OF DEFERRED TAX ASSETS     2023     2022   Deferred Tax Assets:                 Net Operating Loss Carryforwards   $ 2,781,168     $ 2,296,982   Impairment Loss on Long Term Assets     390,295       393,026   Interest Expense     485,044       -   Bad Debt Allowance     545,768       -                     Deferred Tax Assets     4,202,275       2,690,008   Deferred Tax Liabilities:                 Property and Equipment     (1,391,332 )     (1,502,934 ) Other     (9,478 )     (8,807 )                   Deferred Tax Liabilities     (1,400,810 )     (1,511,741 )                   Valuation Allowance     (2,801,465 )     (1,178,267 )                   Net Deferred Tax Asset   $ -     $ -       The valuation allowance at December 31, 2023 and 2022 was primarily related to federal net operating loss carryforwards that, in the judgment of management, are not more-likely-than-not to be realized. In assessing the realizability of deferred tax assets, management considers whether it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities (including the impact of available carryback and carryforward periods), projected future taxable income, and tax-planning strategies in making this assessment. Based upon the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax assets are deductible, management believes it is more-likely-than-not that the Company will not realize the benefits of these deductible differences, net of the existing valuation allowance at December 31, 2023.   As of December 31, 2023 and 2022, the Company has $10,208,276 and $4,223,130 federal net operating losses, among which, if not used, $630,913 and $630,913 would begin to expire starting 2037. The remaining $9,577,363 net operating losses are subject to the 80% taxable income limitation. As of December 31, 2023 and 2022, the Company has $15,670,635 and $10,467,971 state net operating losses   When more than a 50% change in ownership occurs, over a three-year period, as defined, the Tax Reform Act of 1986 limits the utilization of net operating loss carry forwards in the years following the change in ownership. In September 2013, the Company had a split-off, in which the business activities changed from gaming casinos into real estate related to long-term care. The Company determined that the pre-2013 net operating losses of $4,047,175 were subject to the limitation set forth under Internal Revenue Code Section 382 and thus wrote off such net operating losses in 2022. No determination has been made regarding whether another ownership change had occurred during 2014 and 2023.   We have evaluated whether there were material uncertain tax positions requiring recognition in our financial statements. During the period of 2016 to 2021, the Company had recorded bad debt allowances that should have had been adjusted on income tax returns but were not. Consent from the IRS is needed to change the accounting method on tax treatment of bad debt allowance. As of December 31, 2021, the Company has $1,901,203 bad debt allowance. The Company recognized $0 uncertain tax liability in the calculation of deferred tax assets from NOL. When filing its 2022 income tax return, the Company submitted an application to change the accounting method on bad debt allowance. The company policy is to treat tax-related interest and penalties as income tax expense. As of December 31, 2023, the Company did not identify any other uncertain tax position.   The following table summarizes the activity related to the Company’s gross unrecognized tax liabilities:  SCHEDULE OF UNRECOGNIZED TAX LIABILITIES     2023     2022   Unrecognized tax liabilities, beginning of the year   $ 454,439     $ -   Increase (decrease) related to prior year tax positions     (454,439 )     478,988   Increase (decrease) related to current year tax positions     -       (24,549 ) Unrecognized tax liabilities, end of the year     -       454,439

v3.24.3

GOODWILL	12 Months Ended
	Dec. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
GOODWILL	8. GOODWILL   Goodwill is tested for impairment at a reporting unit level on an annual basis or when an event occurs, or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. During the years ended December 31, 2023 and 2022, the Company recorded no impairment of Goodwill.   Following is a summary of goodwill for the years ended December 31, 2023 and 2022:  SCHEDULE OF ACTIVITIES IN GOODWILL Balance, December 31, 2021   $ 1,076,908   Goodwill acquired in 2022     -   Balance, December 31, 2022     1,076,908   Goodwill acquired in 2023     -   Balance, December 31, 2023   $ 1,076,908

v3.24.3

LEGAL PROCEEDINGS	12 Months Ended
	Dec. 31, 2023
Commitments and Contingencies Disclosure [Abstract]
LEGAL PROCEEDINGS	9. LEGAL PROCEEDINGS   The Company and/or its affiliated subsidiaries are or were involved in the following litigation:   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, filed in April 2016. 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.   Oliphant v. Global Eastman, LLC, et.al., State Court of Cobb County, State of Georgia, Civil Action No. 20-A-3983   This is a personal injury lawsuit against various defendants arising out of the death of a patient of the Eastman Healthcare & Rehab Center (the “Facility”). At all relevant times, the Facility was owned by the Company’s wholly owned subsidiary Dodge NH, LLC and leased to Eastman Health & Rehab LLC, an affiliate of Cadence Healthcare, as lease operator. Neither the Company nor any affiliate of the Company had any involvement in patient care at the time of the incident for which complaint was made. The Company relies upon well-settled Georgia law that a landlord has no liability for patient care. The landlord is Dodge NH, LLC. Global Eastman, LLC was not formed as a legal entity during the period of the incident and did not assume the past liabilities as part of the OTA with the receivership of Eastman Healthcare & Rehab LLC which was effective July 1, 2020. Global Eastman LLC was formed on November 21, 2019. Plaintiff has dismissed these claims with prejudice, and the Company has filed a Motion to be awarded attorney’s fees and costs.   Lawson v. C.R.M of Warrenton, LLC d/b/a Warrenton Health and Rehab; ATL/WARR, LLC; Selectis Warrenton, LLC, et.al., Superior Court of Warren County, State of Georgia, Civil Action No. 23CV0076.   This is a personal injury lawsuit filed on June 14, 2023 against various defendants arising out of the death of a patient of the Warrenton Health and Rehab Facility located in Warren, Georgia (the “Facility”). The Facility is owned by the Company’s wholly-owned subsidiary ATL/Warr, LLC. At all relevant times, the Facility was leased and operated by a third party C.R.M. Warrenton, LLC under an operating lease. Neither the Company nor any affiliate of the Company had any involvement in patient care at the time of the incident for which complaint was made. The Company relies upon well-settled Georgia law that a landlord has no liability for patient care. Subsequent to the patient care complained of the Company entered into an Operations Transfer Agreement with the lease operator and assumed operating control of the Facility through a new subsidiary, Selectis Warrenton, LLC. The Company believes its exposure in this matter is de minimus and has referred the litigation to its insurance company for management.   Hines v. Global Abbeville LLC, d/b/a Glen Eagle, et al, Superior Court of Warren County, State of Georgia, Civil Action No.2023-CV-094   This is a personal injury lawsuit filed on September 11, 2023 against various defendants arising from injuries several months after being admitted to the Glen Eagle facility. The complaint alleges that the facility was negligent in the care administered to the plaintiff which resulted in the injuries, which the Company denies. The Company has referred the litigation to its insurance company for management and believes that its exposure in this matter is de minimus.   Hunter v. Global Abbeville LLC, d/b/a Glen Eagle, et al, State Court of Fulton County, State of Georgia   This is a wrongful death lawsuit filed on June 20, 2023 against various defendants alleging negligence that led to the death of the plaintiff’s mother who had been admitted to the facility. The complaint alleges that the plaintiffs deviated from the standard of care that caused injuries that ultimately led to the death of the patient, which the Company denies. The Company has referred the litigation to its insurance company for management and believes that its exposure in this matter is de minimus.

v3.24.3

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	12 Months Ended
	Dec. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and Description of the Business	Organization and Description of the Business   Selectis Health, Inc (“Selectis” or “we” or the “Company”) owns and operates, through wholly-owned subsidiaries Assisted Living Facilities, Independent Living Facilities, and Skilled Nursing Facilities across the South and Southeastern portions of the US. In 2019, the Company shifted from leasing long-term care facilities to third-party, independent operators towards an owner operator model.   Prior to the Company changing its name to Selectis Health, Inc., the Company was known as Global Healthcare REIT, Inc. from September 30, 2013, to May 2021. Prior to this, 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”). WPF was merged into the Company in 2019.   In September 2021, the Company rebranded to Selectis Health, Inc., from Global Healthcare REIT, Inc. to better align with the current and future business model, which is to own and operate its facilities.   The Company acquires, develops, leases and manages healthcare real estate, provide financing to healthcare providers, and provide healthcare operations through our wholly-owned subsidiaries. Our portfolio is comprised of investments in the following healthcare segments: (i) senior housing (including independent and assisted living) and (ii) post-acute/skilled nursing. We will make investments within our healthcare segments using the following six investment products: (i) direct ownership of properties, (ii) debt investments, (iii) developments and redevelopments, (iv) investment management, (v) the Housing and Economic Recovery Act of 2008 (“RIDEA”), which represents investments in senior housing operations utilizing the structure permitted by RIDEA and (xi) owning healthcare operations.
Basis of Presentation	Basis of Presentation   The accompanying consolidated financial statements (the Financial Statements) have been prepared in accordance with accounting principles generally accepted in the United States (GAAP). The Company is the sole member of various consolidated limited liability companies established to operate various acquired skilled nursing operations, senior living operations and related ancillary services. All intercompany transactions and balances have been eliminated in consolidation. The Company presents noncontrolling interests within the equity section of its consolidated balance sheets and the amount of consolidated net income that is attributable to Selectis Health, Inc. and the noncontrolling interest in its consolidated statements of operations.   The consolidated financial statements include the accounts of all entities controlled by the Company through its ownership of a majority voting interest.
Use of Estimates and Assumptions	Use of Estimates and Assumptions   The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP” or “GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant estimates included herein relate to the recoverability of assets, the purchase price allocation for properties acquired, and the fair value of certain assets and liabilities. Actual results may differ from estimates.
Management’s Liquidity Plans	Management’s Liquidity Plans   On August 27, 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-05, Disclosure of Uncertainties about an Entity’s ability to Continue as a Going Concern, which requires management to assess a company’s ability to continue as a going concern within one year from financial statement issuance and to provide related footnote disclosures in certain circumstances.   For the year ended December 31, 2023 the Company had positive operating cash flows of $0.5 million and a net working capital deficit of $13.2 million. Management is unsure that it will be able to meet its obligations in the next twelve months from the date of these financial statements. This is, in part due to a $11,170,100 in current maturities of our long-term debt occurring during 2024, and that there are no assurances that the Company will be able to refinance these loans. Based on management’s projections of continued operating losses, there is substantial doubt that the Company can generate positive cashflows from its continued operations.     Management’s plan to address the Company’s liquidity issues includes, focusing on improving occupancy rates at our facilities to bolster revenues, implementing cost cutting measures at both the facility and corporate level, working with our lenders to extend mortgages and notes that are maturing, and selling off key, underperforming properties to improve our cash flow.   These actions should alleviate any substantial doubt about the Company’s ability to continue as a going concern as defined by ASU 2014-05. However, we cannot predict, with certainty, the outcome of our actions to generate liquidity and the failure to do so could negatively impact our future operations.
Cash and Cash Equivalents	Cash and Cash Equivalents   The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.
Restricted Cash	Restricted Cash   Restricted cash consisted of the following as of December 31:  SCHEDULE OF RESTRICTED CASH AND CASH EQUIVALENTS     2023     2022                     Funds held in escrow under the terms of notes for future capital expenditures, repairs and maintenance   $ 820,124     $ 996,400
Concentration of Credit Risk	Concentration of Credit Risk   The Company maintains deposits in financial institutions that at times exceed the insured amount of $250,000 provided by the U.S. Federal Deposit Insurance Corporation (FDIC). The Company went to an Insured Cash Sweep service (ICS) in 2021. ICS funds are eligible for multi-million-dollar FDIC insurance that’s backed by the full faith and credit of the United States government. Daily cash is swept and deposited to as many banks as needed that are FDIC insured. This insures no amounts exceed a $250,000 balance which is fully insured by the FDIC. The funds can be tracked by its primary financial institution. New funds can be deposited and withdrawn from that single relationship. The Company believes the financial institutions it uses are credit worthy and stable. The Company does not believe that it is exposed to any significant credit risk in cash and cash equivalents or restricted cash.
Property and Equipment	Property and Equipment   In accordance with purchase accounting guidance established for entities under common control, the property and equipment acquired from entities under common control are stated at their carrying value on the date of acquisition. Property and equipment not acquired from entities under common control is recorded at its estimated fair value. Estimated fair value is determined with the assistance from independent valuation specialists using recent sales of similar assets, market conditions or projected cash flows of properties using standard industry valuation techniques.   Upon acquisition of real estate properties determined to be asset acquisitions, the Company determines the total purchase price of each property and allocates the purchase price of acquired properties to net tangible and identified intangible assets based on relative fair values. Fair value estimates are based on information obtained from independent appraisals, other market data, and information obtained during due diligence period. Acquisition-related costs such as due diligence, legal and accounting fees are included in the purchase price. Initial valuations are subject to change during the measurement period, but the period ends as soon as the information is available. The measurement period shall not exceed one year from the date of acquisition.     Upon acquisition of business entities and real estate determined to be a business combination, the Company identifies and recognizes the net tangible and identified intangible assets based on fair values, and net assets as goodwill or gain on bargain purchase. 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, leasing, and or operating at the specific property. Acquisition-related costs such as due diligence, legal and accounting fees are expensed as incurred. Initial valuations are subject to change during the measurement period, but the period ends as soon as the information is available. The measurement period shall not exceed one year from the date of acquisition.   Any subsequent betterments and improvements are stated at historical cost. Depreciation is provided using the straight-line method over the estimated useful lives of the assets, and tenant improvements are depreciated over the remaining term of the lease. Useful lives of the assets are summarized as follows:  SCHEDULE OF PROPERTY PLANT AND EQUIPMENT, ESTIMATED USEFUL LIVES Land Improvements   15 years Buildings and Improvements   30 years Furniture, Fixtures and Equipment   10 years
Impairment of Long-Lived Assets	Impairment of Long-Lived Assets   When circumstances indicate the carrying value of property and equipment may not be recoverable, the Company reviews the property 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 and equipment. Estimated fair value is determined with the assistance from independent valuation specialists using recent sales of similar assets, market conditions or projected cash flows of the property using standard industry valuation techniques.
Deferred Loan Costs and Debt Discounts	Deferred Loan Costs and Debt Discounts   Deferred loan costs are amortized over the life of the related loan using the straight-line method, which approximates the effective interest method. Amortization expense for the years ended December 31, 2023 and 2022 totaled $347,783 and $315,983, respectively. Deferred loan cost amortization is included as a component of interest expense in the consolidated statements of operations.
Goodwill	Goodwill   Goodwill represents the excess of the cost of an acquired business over the amounts assigned to its net assets. Goodwill is not amortized but is tested for impairment at a reporting unit level on an annual basis or when an event occurs, or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Events or changes in circumstances that may trigger interim impairment reviews include significant changes in business climate, operating results, planned investments in the reporting unit, or an expectation that the carrying amount may not be recoverable, among other factors.   The Company may first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events and circumstances, the Company determines it is more likely than not that the fair value of the reporting unit is greater than it’s carrying amount, an impairment test is unnecessary. If an impairment test is necessary, the Company will estimate the fair value of its related reporting units. If the carrying value of a reporting unit exceeds its fair value, the goodwill of that reporting unit is determined to be impaired, and the Company will proceed with recording an impairment charge equal to the excess of the carrying value over the related fair value.     The Company has recorded Goodwill in connection with business acquisitions during the year ended December 31, 2020 (see Note 9). During the years ended December 31, 2023 and 2022, the Company recorded no impairment of Goodwill.
Revenue Recognition	Revenue Recognition   Rent receivables are carried net of an allowance for uncollectible amounts. An allowance is maintained for estimated losses resulting from the inability of certain tenants to meet the contractual obligations under their lease agreements.   The Company’s leases may be subject to annual escalations of the minimum monthly rent required under each lease. The accompanying consolidated financial statements reflect rental income on a straight-line basis over the term of each lease. During the year ended December 31, 2023 the Company did not terminate leases that would result in annual escalations.   When the lessee is the owner of any improvements, any lessee improvement allowance that is funded by the Company is treated as a lease incentive and amortized as a reduction of revenue over the lease term. As of December 31, 2023, and 2022, there were no deferred lease incentives recorded.   The Company recognizes revenue in accordance with ASU 2014-09, “Revenue from Contracts with Customers (Topic 606),” including subsequently issued updates. Under the accounting guidance our revenues are presented net of estimated allowances, and we no longer present the contractual allowance as a separate line item on our balance sheet.   The Company reviews its calculations for the realizability of gross service revenues monthly to make certain that we are properly allowing for the uncollectible portion of our gross billings and that our estimates remain sensitive to variances and changes within our payer groups. The contractual allowance calculation is made based on historical allowance rates for the various specific payer groups monthly with a greater emphasis given to current trends. This calculation is routinely analyzed by the Company based on actual allowances issued by payers and the actual payments made to determine what adjustments, if any, are needed.   Our revenues generally relate to contracts with patients in which our performance obligations are to provide health care services to the patients. Revenues are recorded during the period our obligations to provide health care services are satisfied. Our performance obligations for inpatient services are generally satisfied over periods that average approximately five days, and revenues are recognized based on charges incurred in relation to total expected charges. The contractual relationships with patients, in most cases, also involve a third-party payer (Medicare, and Medicaid) and the transaction prices for the services provided are dependent upon the terms provided by the third party payer or payers. Medicare generally pays for inpatient and outpatient services at prospectively determined rates based on clinical, diagnostic and other factors. Services provided to patients having Medicaid coverage are generally paid at prospectively determined rates per discharge, per identified service or per covered member.   Our revenues are based upon the estimated amounts we expect to be entitled to receive from patients and third-party payers. Estimates of contractual allowances under managed care are based upon the payment terms specified in the related contractual agreements.     Laws and regulations governing the Medicare and Medicaid programs are complex and subject to interpretation. Estimated reimbursement amounts are adjusted in subsequent periods as cost reports are prepared and filed and as final settlements are determined. In relation to certain government programs, primarily Medicare, this is generally referred to as the “cost report” filing and settlement process.
Allowance for Credit Losses	Allowance for Credit Losses   In September 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instrument (“ASU 2016-13”). ASU 2016-13 requires entities to use a forward-looking approach based on current expected credit losses (“CECL”) to estimate credit losses on certain types of financial instruments, including trade receivables. This may result in the earlier recognition of allowances for credit losses. The Company adopted ASU 2016-13 January 1, 2023. We identified trade and ERTC accounts receivable financial instruments that would be impacted by this adoption.   As part of the analysis, the Company determined that all trade accounts receivable were of similar risk. Given the economy and our services provided, we determined the trade accounts receivable would not be impacted. The Company recorded an allowance of $1,874,068 as of December 31, 2023. This included fully reserving for receivables greater than 90 days. For the year ended December 31, 2023, the Company recorded $1,475,205 on the statement of operations as a provision for credit losses expense.   The CARES Act provides an employee retention credit (“CARES Employee Retention Credit”), which is a refundable tax credit against certain employment taxes of up to $5,000 per employee for eligible employers. The tax credit is equal to 50% of qualified wages paid to employees during a quarter, capped at $10,000 of qualified wages per employee through December 31, 2020. Additional relief provisions were passed by the United States government, which extend and slightly expand the qualified wage caps on these credits through December 31, 2021. Based on these additional provisions, the tax credit is now equal to 70% of qualified wages paid to employees during a quarter, and the limit on qualified wages per employee has been increased to $10,000 of qualified wages per quarter. The Company qualified for the tax credit under the CARES Act for qualified wages for the years ended December 31, 2020 and 2021. In February 2023, the Company submitted filings for CARES Employee Retention Credits totaling $6,866,759. As of December 31, 2023, the Company recorded an employee retention credits receivable of $1,257,952. Upon evaluation of the collectability of this receivable, the Company recorded a full allowance against this receivable and recorded an expense to provision for credit losses on the statement of operations.
Stock-Based Compensation	Stock-Based Compensation   The Company accounts for stock-based compensation in accordance with Accounting Standards Codification (“ASC”) ASC 718, “Compensation-Stock Compensation”. ASC 718 requires companies to measure the cost of employee services received in exchange for an award of equity instruments, including stock options, based on the grant-date fair value of the award and to recognize it as compensation expense over the period the employee is required to provide service in exchange for the award, usually the vesting period. During the years ended December 31, 2023 and 2022, the Company incurred $625 and $0, respectively of stock-based compensation.
Fair Value Measurements	Fair Value Measurements   The Company utilizes the methods of fair value measurement as described in ASC 820 to value its financial assets and liabilities. As defined in ASC 820, fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In order to increase consistency and comparability in fair value measurements, ASC 820 establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels, which are described below:   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.   The Company has no financial assets or financial liabilities that are required to be measured at fair value on a recurring basis as of December 31, 2023, and 2022.   The carrying values of cash and cash equivalents, accounts payable, accrued liabilities and other short-term debt, approximate their fair value because of the short-term nature of these financial instruments. The carrying value of long-term debt approximates fair value since the related rates of interest approximate current market rates.   Upon acquisition of real estate properties, the Company determines the total purchase price of each property and allocates this price based 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 rates from a third-party appraisal or other market sources.
Income Taxes	Income Taxes   As previously disclosed in the “Organization and Description of the Business” section of this Note, the Company’s focus has partially shifted from leasing nursing home assets to independent operators toward owning and operating its real estate assets itself.   The Company uses the asset and liability method of accounting for income taxes. Accordingly, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates resulting from new legislation is recognized in income in the period of enactment. A valuation allowance is established against deferred tax assets when management concludes that the “more likely than not” realization criteria has not been met. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained.
Income (Loss) Per Common Share	Income (Loss) Per Common Share   Basic earnings per share are based on the weighted-average number of shares of common stock outstanding. FASB ASC Topic 260, “Earnings per Share”, requires the Company to include additional shares in the computation of earnings per share, assuming dilution.   Diluted earnings per share are based on the assumption that all dilutive options and warrants were converted or exercised by applying the treasury stock method and that all convertible preferred stock were converted into common shares by applying the if-converted method. Under the treasury stock method, options and warrants are assumed to be exercised at the beginning of the period or at the time of issuance, if later, and as if funds obtained thereby were used to purchase common stock at the average market price during the period. Under the if-converted method, the preferred dividends applicable to convertible preferred stock are added back to the numerator. The convertible preferred stock is assumed to have been converted at the beginning of the period or at time of issuance, if later, and the resulting common shares are included in the denominator.   We calculate basic earnings per share by dividing net income attributable to common stockholders (the “numerator”) by the weighted average number of common shares outstanding (the “denominator”) during the reporting period. Diluted earnings per share is calculated similarly but reflects the potential impact of outstanding options, warrants and other commitments to issue common stock, including shares issuable upon the conversion of convertible preferred stock outstanding, except where the impact would be anti-dilutive.     The following table sets forth the computation of basic and diluted earnings per share:  SCHEDULE OF BASIC AND DILUTED EARNINGS PER SHARE     2023     2022       Year Ended December 31,       2023     2022   Numerator for basic earnings per share:                 Net Loss Attributable to Selectis Health, Inc.   $ (3,970,982 )   $ (2,395,813 ) Series D Preferred Dividends     (30,000 )     (30,000 ) Net Loss Attributable to Common Stockholders - Basic   $ (4,000,982 )   $ (2,425,813 )                   Numerator for diluted earnings per share:                 Net Loss Attributable to Common Stockholders     (3,970,982 )     (2,395,813 ) Series D Preferred Dividends     (30,000 )     (30,000 ) Net Loss Attributable to Common Stockholders - Diluted     (4,000,982 )     (2,425,813 )                   Denominator for basic earnings per share:                 Weighted Average Common Shares Outstanding     3,054,587       3,054,126                     Denominator for diluted earnings per share:                 Weighted Average Common Shares Outstanding - Basic     3,054,587       3,054,126   Effect of dilutive securities:     -       -   Issuance of stock options     -       -   Exercise of warrants     -       -   Weighted Average Common Shares Outstanding - Diluted     3,054,587       3,054,126                     Net Loss per Share Attributable to Common Stockholders:                 Basic   $ (1.31 )   $ (0.79 ) Diluted   $ (1.31 )   $ (0.79 )   Options to purchase 30,000 shares of common stock were outstanding during the years ended December 31, 2023 and 2022 but were not included in the computation of diluted earnings per share because they are anti-dilutive due to the options’ exercise price being greater than the average market price of the common shares.
Recently Issued Accounting Pronouncements	Recently Issued Accounting Pronouncements   In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvement to Income Tax Disclosures, amending income tax disclosure requirements for the effective tax rate reconciliation and income taxes paid. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024 and are applied prospectively. Early adoption and retrospective application of the amendments are permitted. We are currently evaluating the impact of this update on our consolidated financial statements and disclosures.   The FASB and other entities issued new or modifications to, or interpretations of, existing accounting guidance during 2023. 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.

v3.24.3

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)	12 Months Ended
	Dec. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
SCHEDULE OF RESTRICTED CASH AND CASH EQUIVALENTS	Restricted cash consisted of the following as of December 31:  SCHEDULE OF RESTRICTED CASH AND CASH EQUIVALENTS     2023     2022                     Funds held in escrow under the terms of notes for future capital expenditures, repairs and maintenance   $ 820,124     $ 996,400
SCHEDULE OF PROPERTY PLANT AND EQUIPMENT, ESTIMATED USEFUL LIVES	SCHEDULE OF PROPERTY PLANT AND EQUIPMENT, ESTIMATED USEFUL LIVES Land Improvements   15 years Buildings and Improvements   30 years Furniture, Fixtures and Equipment   10 years
SCHEDULE OF BASIC AND DILUTED EARNINGS PER SHARE	The following table sets forth the computation of basic and diluted earnings per share:  SCHEDULE OF BASIC AND DILUTED EARNINGS PER SHARE     2023     2022       Year Ended December 31,       2023     2022   Numerator for basic earnings per share:                 Net Loss Attributable to Selectis Health, Inc.   $ (3,970,982 )   $ (2,395,813 ) Series D Preferred Dividends     (30,000 )     (30,000 ) Net Loss Attributable to Common Stockholders - Basic   $ (4,000,982 )   $ (2,425,813 )                   Numerator for diluted earnings per share:                 Net Loss Attributable to Common Stockholders     (3,970,982 )     (2,395,813 ) Series D Preferred Dividends     (30,000 )     (30,000 ) Net Loss Attributable to Common Stockholders - Diluted     (4,000,982 )     (2,425,813 )                   Denominator for basic earnings per share:                 Weighted Average Common Shares Outstanding     3,054,587       3,054,126                     Denominator for diluted earnings per share:                 Weighted Average Common Shares Outstanding - Basic     3,054,587       3,054,126   Effect of dilutive securities:     -       -   Issuance of stock options     -       -   Exercise of warrants     -       -   Weighted Average Common Shares Outstanding - Diluted     3,054,587       3,054,126                     Net Loss per Share Attributable to Common Stockholders:                 Basic   $ (1.31 )   $ (0.79 ) Diluted   $ (1.31 )   $ (0.79 )

v3.24.3

PROPERTY AND EQUIPMENT, NET (Tables)	12 Months Ended
	Dec. 31, 2023
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 December 31, 2023 and 2022 are as follows:  SCHEDULE OF PROPERTY PLANT AND EQUIPMENT     December 31, 2023     December 31, 2022                 Land   $ 1,778,250     $ 1,778,250   Land Improvements     329,055       329,055   Buildings and Improvements     44,665,656       44,659,921   Furniture, Fixtures and Equipment     2,483,207       2,459,138   Property and Equipment, gross     49,256,168       49,226,364                     Less: Accumulated Depreciation     (13,878,450 )     (12,212,251 ) Less: Impairment     (1,560,000 )     (1,560,000 )                   Property and Equipment, net   $ 33,817,718     $ 35,454,113         2023     2022       Year Ended December 31,       2023     2022                 Depreciation Expense (excluding Intangible Assets)   $ 1,666,200     $ 1,792,840                     Cash Paid for Capital Expenditures   $ 29,805     $ 222,361

v3.24.3

DEBT AND DEBT – RELATED PARTIES (Tables)	12 Months Ended
	Dec. 31, 2023
Debt Disclosure [Abstract]
SCHEDULE OF DEBT AND DEBT - RELATED PARTIES	The following is a summary of the Company’s debt and debt – related parties outstanding as of December 31, 2023 and 2022:  SCHEDULE OF DEBT AND DEBT - RELATED PARTIES     2023     2022                 Senior Secured Promissory Notes   $ 1,025,000     $ 1,025,000   Senior Secured Promissory Notes - Related Parties     750,000       750,000   Fixed-Rate Mortgage Loans     29,570,185       30,568,677   Variable-Rate Mortgage Loans     4,675,585       4,879,462   Other Debt, Subordinated Secured     741,000       741,000   Other Debt, Subordinated Secured - Related Parties     150,000       150,000   Other Debt, Subordinated Secured - Seller Financing     15,105       56,051   Financed Insurance Premiums     875,027       235,125   Debt and Debt – Related Parties, Gross     37,801,902       38,405,315   Unamortized Discount and Debt Issuance Costs     (555,367 )     (810,997 ) Debt and Debt – Related Parties, Net of Discount   $ 37,246,535     $ 37,594,318   Debt and Debt – Related Parties, Net of Discount     37,246,536     $ 37,594,318                     As presented in the Consolidated Balance Sheets:                                   Current Maturities of Long Term Debt, Net   $ 11,170,100     $ 2,296,830   Short Term Debt – Related Parties, Net     900,000       900,000   Long-Term Debt, Net     25,176,435       34,397,488   Long-Term Debt - Related Parties, Net
SCHEDULE OF MORTGAGE LOAN DEBT	SCHEDULE OF MORTGAGE LOAN DEBT                 Total Principal Outstanding as of   State   Number of Properties     Total Face Amount     December 31, 2023     December 31, 2022   Arkansas(1)     1     $ 5,000,000     $ 3,739,786     $ 3,910,767   Georgia(2)     5     $ 17,765,992     $ 15,457,026     $ 16,019,874   Ohio     1     $ 3,000,000     $ 2,563,000     $ 2,649,400   Oklahoma(3)     6     $ 13,181,325     $ 12,485,958     $ 12,868,098         13     $ 38,947,317     $ 34,245,770     $ 35,448,139     (1) The mortgage loan collateralized by this property 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. Guarantors under the mortgage loan include Christopher Brogdon. Mr. Brogdon has assumed operations of the facility and is making payments of principal and interest on the loan on our behalf in lieu of paying rent on the facility to us, until a formal lease can be put in place. During the years ended December 31, 2023 and 2022, the Company recognized other income of $170,981 and $143,219, respectively for repayments on the loan.     (2) The Company refinanced two of its mortgages that would have matured in June and October of 2021 amounting to $2,961,167 and $3,289,595, to extend their maturity dates to May 2024 for both.     (3) The Company refinanced all three mortgages in July 2021, that would have matured in June and July of 2021 amounting to $2,065,969 and $750,000, $500,000, to extend their maturity dates to June 2027 for all three. Additionally, the Company has refinanced the primary mortgage at the Southern Hills Campus, for 35 years at 2.38%.
SCHEDULE OF OTHER DEBT	SCHEDULE OF OTHER DEBT           Total Principal Outstanding as of           Property   Face Amount     December 31, 2023     December 31, 2022     Stated Interest Rate   Maturity Date Goodwill Nursing Home   $ 2,030,000     $ 741,000     $ 741,000     13% Fixed   1-Apr-24 Goodwill Nursing Home – Related Party   $ 150,000       150,000       150,000     13% Fixed   30-Nov-25 Higher Call Nursing Center (1)     150,000       15,105       56,051     8% Fixed   1-Apr-24     $ 2,330,000     $ 906,105     $ 947,051             (1) In connection with the acquisition of Higher Call, the Company executed a promissory note in favor of the Seller, Higher Call Nursing Center, Inc., in the principal amount of $150,000 which accrues interest at the rate of 8% per annum and is payable in equal monthly installments, principal and interest. This note is secured by a corporate guaranty of Global.
SCHEDULE OF UNSECURED NOTES AND NOTES SECURED BY ALL ASSETS	Our corporate debt at December 31, 2023 and December 31, 2022 includes unsecured notes and notes secured by all assets of the Company not serving as collateral for other notes.  SCHEDULE OF UNSECURED NOTES AND NOTES SECURED BY ALL ASSETS           Total Principal Outstanding as of           Series   Face Amount     December 31, 2023     December 31, 2022     Stated Interest Rate   Maturity Date 10% Senior Secured Promissory Notes   $ 1,255,000     $ 1,025,000     $ 1,025,000     10% Fixed   30-Jun-24 10% Senior Secured Promissory Notes – Related Party   $ 750,000       750,000       750,000     10% Fixed   31-Dec-24     $ 2,005,000     $ 1,775,000     $ 1,775,000
SCHEDULE OF FUTURE MATURITIES OF NOTES PAYABLE	Future maturities and principal payments of all notes payable listed above for the next five years and thereafter are as follows:  SCHEDULE OF FUTURE MATURITIES OF NOTES PAYABLE Year Ending December 31       2024   $ 12,625,468   2025     7,579,734   2026     601,466   2027     1,546,429   2028 and Thereafter     15,448,807             Total   $ 37,801,903

v3.24.3

STOCKHOLDERS’ EQUITY (Tables)	12 Months Ended
	Dec. 31, 2023
Equity [Abstract]
SCHEDULE OF COMMON STOCK WARRANTS ACTIVITY	SCHEDULE OF COMMON STOCK WARRANTS ACTIVITY     Year Ended December 31,       2023     2022       Number of     Weighted Average     Number of     Weighted Average       Warrants     Exercise Price     Warrants     Exercise Price                             Beginning Balance     206,000     $ 5.00       206,000     $ 5.00   Issued     177,500       -       -       -   Cancelled     -       -       -       -   Exercised     -       -       -       -   Expired     (206,000 )     -       -       -                                     Ending Balance     177,500     $ 5.00       206,000     $ 5.00
SCHEDULE OF COMMON STOCK OPTIONS ACTIVITY	SCHEDULE OF COMMON STOCK OPTIONS ACTIVITY      Year Ended December 31,       2023     2022       Number of     Weighted Average     Number of     Weighted Average       Options     Exercise Price     Options     Exercise Price                             Beginning Balance     30,000     $ 6.00       30,000     $ 6.00   Issued     -       -       -       -   Cancelled     -       -       -       -   Exercised     -       -       -       -   Expired     -       -       -       -                                     Ending Balance     30,000     $ 6.00       30,000     $ 6.00

v3.24.3

FACILITY LEASES (Tables)	12 Months Ended
	Dec. 31, 2023
Facility Leases
SCHEDULE OF LEASING ARRANGEMENTS	The following table summarizes our leasing arrangements related to the Company’s healthcare facilities at December 31, 2023:  SCHEDULE OF LEASING ARRANGEMENTS     Monthly     Lease       Facility   Lease Income (1)     Expiration     Renewal Option if Any                       Goodwill Hunting LLC(1)   $ 52,976       February 1, 2027     Term may be extended for one additional five-year term   (1) The lease became effective on February 1, 2017, and the facility began generating rental revenue thereafter.
SCHEDULE OF FUTURE CASH PAYMENTS FOR RENT RECEIVED DURING INITIAL TERM OF LEASE	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:  SCHEDULE OF FUTURE CASH PAYMENTS FOR RENT RECEIVED DURING INITIAL TERM OF LEASE As of December 31,       2024     643,401   2025     651,954   2026     660,665   2027 and Thereafter     55,116             Total   $ 2,011,136

v3.24.3

INCOME TAXES (Tables)	12 Months Ended
	Dec. 31, 2023
Income Tax Disclosure [Abstract]
SCHEDULE OF INCOME TAX EXPENSES	The following is the breakdown of the Company’s income tax expenses:  SCHEDULE OF INCOME TAX EXPENSES Income Tax Expense:   2023     2022   Current Federal   $        -     $ -   Current State     -                -   Current Income Tax Expenses     -       -   Deferred Federal     -       -   Deferred State     -       -   Deferred Income Tax Expense     -       -   Total Income Tax Expense     -       -
SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION	The following is a reconciliation of the federal statutory tax rate and the effective tax rate as a percentage for the years ended December 31, 2023 and 2022:  SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION     2023           2022                                 Statutory Federal Income Tax Rate     21 %     21 % Prior Year True-ups     (22 )%     (89 )% Permanent Difference                    33 %     (4 )% State Taxes     10 %     4 % Change in Valuation Allowance     (42 )%     68 % Effective tax rate     - %     - %
SCHEDULE OF DEFERRED TAX ASSETS	The components of deferred tax assets as of December 31, 2023 and 2022 are as follows:  SCHEDULE OF DEFERRED TAX ASSETS     2023     2022   Deferred Tax Assets:                 Net Operating Loss Carryforwards   $ 2,781,168     $ 2,296,982   Impairment Loss on Long Term Assets     390,295       393,026   Interest Expense     485,044       -   Bad Debt Allowance     545,768       -                     Deferred Tax Assets     4,202,275       2,690,008   Deferred Tax Liabilities:                 Property and Equipment     (1,391,332 )     (1,502,934 ) Other     (9,478 )     (8,807 )                   Deferred Tax Liabilities     (1,400,810 )     (1,511,741 )                   Valuation Allowance     (2,801,465 )     (1,178,267 )                   Net Deferred Tax Asset   $ -     $ -
SCHEDULE OF UNRECOGNIZED TAX LIABILITIES	The following table summarizes the activity related to the Company’s gross unrecognized tax liabilities:  SCHEDULE OF UNRECOGNIZED TAX LIABILITIES     2023     2022   Unrecognized tax liabilities, beginning of the year   $ 454,439     $ -   Increase (decrease) related to prior year tax positions     (454,439 )     478,988   Increase (decrease) related to current year tax positions     -       (24,549 ) Unrecognized tax liabilities, end of the year     -       454,439

v3.24.3

GOODWILL (Tables)	12 Months Ended
	Dec. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
SCHEDULE OF ACTIVITIES IN GOODWILL	Following is a summary of goodwill for the years ended December 31, 2023 and 2022:  SCHEDULE OF ACTIVITIES IN GOODWILL Balance, December 31, 2021   $ 1,076,908   Goodwill acquired in 2022     -   Balance, December 31, 2022     1,076,908   Goodwill acquired in 2023     -   Balance, December 31, 2023   $ 1,076,908

v3.24.3

SCHEDULE OF RESTRICTED CASH AND CASH EQUIVALENTS (Details) - USD ($)	Dec. 31, 2023	Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Funds held in escrow under the terms of notes for future capital expenditures, repairs and maintenance	$ 820,124	$ 996,400

v3.24.3

SCHEDULE OF PROPERTY PLANT AND EQUIPMENT, ESTIMATED USEFUL LIVES (Details)	Dec. 31, 2023
Land Improvements [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life	15 years
Building Improvements [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life	30 years
Furniture and Fixtures [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, useful life	10 years

v3.24.3

SCHEDULE OF BASIC AND DILUTED EARNINGS PER SHARE (Details) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Net Loss per Share Attributable to Common Stockholders:
Net Loss Attributable to Selectis Health, Inc.	$ (3,970,982)	$ (2,395,813)
Series D Preferred Dividends	(30,000)	(30,000)
Net Loss Attributable to Common Stockholders	(4,000,982)	(2,425,813)
Numerator for diluted earnings per share:
Net Loss Attributable to Common Stockholders	(3,970,982)	(2,395,813)
Series D Preferred Dividends	(30,000)	(30,000)
Net Loss Attributable to Common Stockholders - Diluted	$ (4,000,982)	$ (2,425,813)
Denominator for basic earnings per share:
Weighted Average Common Shares Outstanding - Basic	3,054,587	3,054,126
Denominator for diluted earnings per share:
Effect of dilutive securities:
Issuance of stock options
Exercise of warrants
Weighted Average Common Shares Outstanding - Diluted	3,054,587	3,054,126
Basic	$ (1.31)	$ (0.79)
Diluted	$ (1.31)	$ (0.79)

v3.24.3

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2023	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2020	Feb. 28, 2023	Dec. 31, 2021
Net cash provided by (used in) operating activities		$ 536,666	$ (305,148)
Working capital deficit		13,200,000
Long term debt current maturities		11,170,100	2,296,830
Cash, FDIC insured amount		250,000
Amortization expenses		347,783	315,983
Impairment on goodwill		0	0
Accounts Receivable, Allowance for Credit Loss		1,874,068,000,000
Other Expenses		1,475,205,000,000
[custom:EmployeeRetentionCreditsReceivable-0]					$ 6,866,759
Share based arrangements liability of incurred		$ 625	$ 0
Option to purchase shares		30,000	30,000			30,000
Common Stock [Member]
Option to purchase shares		30,000	30,000
CARES Act [Member]
[custom:PercentageOfEmployeeTaxCredit]	70.00%			50.00%
Salary and Wage, NonOfficer, Excluding Cost of Good and Service Sold	$ 10,000			$ 10,000
[custom:EmployeeRetentionCreditsReceivable-0]		$ 1,257,952,000,000
Maximum [Member] | CARES Act [Member]
Employment taxes		$ 5,000

v3.24.3

SCHEDULE OF PROPERTY PLANT AND EQUIPMENT (Details) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Property, Plant and Equipment [Line Items]
Property and Equipment, gross	$ 49,256,168	$ 49,226,364
Less: Accumulated Depreciation	(13,878,450)	(12,212,251)
Less: Impairment	(1,560,000)	(1,560,000)
Property and Equipment, net	33,817,718	35,454,113
Depreciation Expense (excluding Intangible Assets)	1,666,200	1,792,840
Cash Paid for Capital Expenditures	29,805	222,361
Land [Member]
Property, Plant and Equipment [Line Items]
Property and Equipment, gross	1,778,250	1,778,250
Land Improvements [Member]
Property, Plant and Equipment [Line Items]
Property and Equipment, gross	329,055	329,055
Building Improvements [Member]
Property, Plant and Equipment [Line Items]
Property and Equipment, gross	44,665,656	44,659,921
Furniture and Fixtures [Member]
Property, Plant and Equipment [Line Items]
Property and Equipment, gross	$ 2,483,207	$ 2,459,138

v3.24.3

SCHEDULE OF DEBT AND DEBT - RELATED PARTIES (Details) - USD ($)	Dec. 31, 2023	Dec. 31, 2022
Debt Instrument [Line Items]
Debt and Debt – Related Parties, Gross	$ 37,801,902	$ 38,405,315
Unamortized Discount and Debt Issuance Costs	(555,367)	(810,997)
Debt and Debt – Related Parties, Net of Discount	37,246,536	37,594,318
Current Maturities of Long Term Debt, Net	11,170,100	2,296,830
Long-Term Debt, Net	25,176,435	34,397,488
Related Party [Member]
Debt Instrument [Line Items]
Short Term Debt – Related Parties, Net	900,000	900,000
Senior Secured Promissory Notes [Member]
Debt Instrument [Line Items]
Debt and Debt – Related Parties, Gross	1,025,000	1,025,000
Senior Secured Promissory Notes Related Parties [Member]
Debt Instrument [Line Items]
Debt and Debt – Related Parties, Gross	750,000	750,000
Fixed Rate Mortgage Loans [Member]
Debt Instrument [Line Items]
Debt and Debt – Related Parties, Gross	29,570,185	30,568,677
Variable Rate Mortgage Loans [Member]
Debt Instrument [Line Items]
Debt and Debt – Related Parties, Gross	4,675,585	4,879,462
Other Debt Subordinated Secured [Member]
Debt Instrument [Line Items]
Debt and Debt – Related Parties, Gross	741,000	741,000
Other Debt Subordinated Secured Related Parties [Member]
Debt Instrument [Line Items]
Debt and Debt – Related Parties, Gross	150,000	150,000
Other Debt Subordinated Secured Seller Financing [Member]
Debt Instrument [Line Items]
Debt and Debt – Related Parties, Gross	15,105	56,051
Financed Insurance Premiums [Member]
Debt Instrument [Line Items]
Debt and Debt – Related Parties, Gross	$ 875,027	$ 235,125

v3.24.3

SCHEDULE OF MORTGAGE LOAN DEBT (Details) - Mortgage Loans [Member]		Dec. 31, 2023 USD ($) Integer	Dec. 31, 2022 USD ($)
Short-Term Debt [Line Items]
Number of Properties | Integer		13
Total Face Amount		$ 38,947,317
Total Principal Outstanding		$ 34,245,770	$ 35,448,139
ARKANSAS
Short-Term Debt [Line Items]
Number of Properties | Integer	[1]	1
Total Face Amount	[1]	$ 5,000,000
Total Principal Outstanding	[1]	$ 3,739,786	3,910,767
GEORGIA
Short-Term Debt [Line Items]
Number of Properties | Integer	[2]	5
Total Face Amount	[2]	$ 17,765,992
Total Principal Outstanding	[2]	$ 15,457,026	16,019,874
OHIO
Short-Term Debt [Line Items]
Number of Properties | Integer		1
Total Face Amount		$ 3,000,000
Total Principal Outstanding		$ 2,563,000	2,649,400
OKLAHOMA
Short-Term Debt [Line Items]
Number of Properties | Integer	[3]	6
Total Face Amount	[3]	$ 13,181,325
Total Principal Outstanding	[3]	$ 12,485,958	$ 12,868,098
[1] The mortgage loan collateralized by this property 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. Guarantors under the mortgage loan include Christopher Brogdon. Mr. Brogdon has assumed operations of the facility and is making payments of principal and interest on the loan on our behalf in lieu of paying rent on the facility to us, until a formal lease can be put in place. During the years ended December 31, 2023 and 2022, the Company recognized other income of $170,981 and $143,219, respectively for repayments on the loan. [2] The Company refinanced two of its mortgages that would have matured in June and October of 2021 amounting to $2,961,167 and $3,289,595, to extend their maturity dates to May 2024 for both. [3] The Company refinanced all three mortgages in July 2021, that would have matured in June and July of 2021 amounting to $2,065,969 and $750,000, $500,000, to extend their maturity dates to June 2027 for all three. Additionally, the Company has refinanced the primary mortgage at the Southern Hills Campus, for 35 years at 2.38%.

v3.24.3

SCHEDULE OF MORTGAGE LOAN DEBT (Details) (Parenthetical) - USD ($)	1 Months Ended			12 Months Ended
	Oct. 31, 2021	Jul. 31, 2021	Jun. 30, 2021	Dec. 31, 2023	Dec. 31, 2022
First Mortgage Loan [Member]
Short-Term Debt [Line Items]
Mortgage amount		$ 2,065,969	$ 2,961,167
Maturity date		June 2027	May 2024
Debt instrument term		35 years
Interest rate		2.38%
Second Mortgage [Member]
Short-Term Debt [Line Items]
Mortgage amount	$ 3,289,595	$ 750,000
Maturity date	May 2024	June 2027
Debt instrument term		35 years
Interest rate		2.38%
Third Mortgage Loan [Member]
Short-Term Debt [Line Items]
Mortgage amount		$ 500,000
Maturity date		June 2027
Debt instrument term		35 years
Interest rate		2.38%
Mortgage Loans [Member] | ARKANSAS
Short-Term Debt [Line Items]
USDA guaranteed rate				80.00%
Annual renewal fee payable percentage				0.25%
Repayment of loan				$ 170,981	$ 143,219

v3.24.3

SCHEDULE OF OTHER DEBT (Details) - Other Debt [Member] - USD ($)		12 Months Ended
		Dec. 31, 2023	Dec. 31, 2022
Short-Term Debt [Line Items]
Face Amount		$ 2,330,000
Total, Principal Outstanding		906,105	$ 947,051
Goodwill Nursing Home [Member]
Short-Term Debt [Line Items]
Face Amount		2,030,000
Total, Principal Outstanding		$ 741,000	741,000
Stated Interest Rate		13% Fixed
Maturity Date		Apr. 01, 2024
Goodwill Nursing Home - Related Party [Member]
Short-Term Debt [Line Items]
Face Amount		$ 150,000
Total, Principal Outstanding		$ 150,000	150,000
Stated Interest Rate		13% Fixed
Maturity Date		Nov. 30, 2025
Higher Call Nursing Center [Member]
Short-Term Debt [Line Items]
Face Amount	[1]	$ 150,000
Total, Principal Outstanding	[1]	$ 15,105	$ 56,051
Stated Interest Rate	[1]	8% Fixed
Maturity Date	[1]	Apr. 01, 2024
[1] In connection with the acquisition of Higher Call, the Company executed a promissory note in favor of the Seller, Higher Call Nursing Center, Inc., in the principal amount of $150,000 which accrues interest at the rate of 8% per annum and is payable in equal monthly installments, principal and interest. This note is secured by a corporate guaranty of Global.

v3.24.3

SCHEDULE OF OTHER DEBT (Details) (Parenthetical) - Higher Call Nursing Center [Member]	Dec. 31, 2023 USD ($)
Debt instrument, face amount	$ 150,000
Debt instrument, interest rate, stated percentage	8.00%

v3.24.3

SCHEDULE OF UNSECURED NOTES AND NOTES SECURED BY ALL ASSETS (Details) - Unsecured Notes [Member] - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Short-Term Debt [Line Items]
Face Amount	$ 2,005,000
Total Principal Outstanding	1,775,000	$ 1,775,000
11% Senior Secured Promissory Note [Member]
Short-Term Debt [Line Items]
Face Amount	1,255,000
Total Principal Outstanding	$ 1,025,000	1,025,000
Stated Interest Rate	10% Fixed
Maturity Date	Jun. 30, 2024
11% Senior Secured Promissory Note [Member] | Related Party [Member]
Short-Term Debt [Line Items]
Face Amount	$ 750,000
Total Principal Outstanding	$ 750,000	$ 750,000
Stated Interest Rate	10% Fixed
Maturity Date	Dec. 31, 2024

v3.24.3

SCHEDULE OF FUTURE MATURITIES OF NOTES PAYABLE (Details)	Dec. 31, 2023 USD ($)
Debt Disclosure [Abstract]
2024	$ 12,625,468
2025	7,579,734
2026	601,466
2027	1,546,429
2028 and Thereafter	15,448,807
Total	$ 37,801,903

v3.24.3

DEBT AND DEBT – RELATED PARTIES (Details Narrative) - USD ($)									1 Months Ended		12 Months Ended
	Sep. 05, 2023	Jun. 27, 2023	Mar. 29, 2023	Sep. 30, 2020	Mar. 03, 2020	Feb. 05, 2020	Jan. 28, 2020	Dec. 31, 2017	Oct. 31, 2018	Oct. 31, 2017	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Oct. 31, 2020	Jan. 17, 2020
Debt Instrument [Line Items]
Amortization of debt discount											$ 84,352
Cash payments on debt											695,566	$ 1,865,458
Amortization expense											$ 347,783	$ 315,983
Related Parties [Member]
Debt Instrument [Line Items]
Proceeds from the issuance of debt					$ 100,000
Notes and Warrants [Member]
Debt Instrument [Line Items]
Debt instrument, interest rate									10.00%
Maturity date															Oct. 31, 2021
Warrants to purchase common stock									11,100
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									$ 1,075,000.000						$ 1,075,000.000
Related Parties [Member] | Notes and Warrants [Member]
Debt Instrument [Line Items]
Aggregate exchangeable units, value															$ 875,000
Senior Secured Promissory Notes [Member]
Debt Instrument [Line Items]
Debt term									3 years
Debt instrument, interest rate									11.00%					10.00%			11.00%
Maturity date														Dec. 31, 2018
Senior secured promissory notes issued																$ 600,000
Debt outstanding amount								$ 1,200,000								$ 1,200,000
Warrants description								For every $10.00 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 $7.50 per share.	one Warrant for each $10.00 in principal amount of Note exercisable for three years to purchase a share of Common Stock at an exercise price of $5.00 per share.
Warrants exercise price								$ 7.50	$ 5.00							$ 7.50
Warrants to purchase common stock								120,000								120,000
Warrant maturity date								Dec. 31, 2018								Dec. 31, 2018
Warrants unissued during the period								225,000								225,000
Cash payments on debt														$ 125,000
Debt instrument maturity date, description									due in three years, (October 31, 2021)
Senior Secured Promissory Notes [Member] | Related Parties [Member]
Debt Instrument [Line Items]
Senior secured promissory notes issued																$ 425,000
10% Senior Secured Promissory Note [Member]
Debt Instrument [Line Items]
Debt instrument, interest rate							10.00%						10.00%
Maturity date							Dec. 31, 2018						Dec. 31, 2018
Notes exchanged							$ 100,000
Notes payable													$ 25,000
11% Senior Secured Notes [Member]
Debt Instrument [Line Items]
Debt instrument, interest rate							11.00%											11.00%
Senior secured promissory notes issued					$ 100,000	$ 60,000
Warrants exercise price							$ 5.00											$ 0.50
Warrants to purchase common stock					10,000	6,000	10,000
Warrant maturity date							Oct. 31, 2021											Oct. 31, 2021
11% Senior Secured Notes [Member] | Board of Director [Member]
Debt Instrument [Line Items]
Debt outstanding amount																		$ 2,500,000
Senior Unsecured Notes [Member]
Debt Instrument [Line Items]
Debt instrument, interest rate				10.00%						10.00%							10.00%
Maturity date				Oct. 31, 2020
Warrants description										For every $10.00 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 $7.50 per share.
Warrants exercise price										$ 7.50							$ 5.00
Warrants to purchase common stock																	15,000
Warrant maturity date																	Oct. 31, 2020
Cash payments on debt				$ 150,000
Notes exchanged																	$ 150,000
Senior unsecured notes sold										$ 300,000
Debt instrument maturity date, description										October 2020
11% Senior Secured Promissory Note [Member]
Debt Instrument [Line Items]
Warrants exercise price																	$ 5.00
Warrants to purchase common stock																	15,000
Warrant maturity date																	Oct. 31, 2021
Senior secured notes [Member]
Debt Instrument [Line Items]
Maturity date		Dec. 31, 2024									Oct. 31, 2021	Oct. 31, 2021
Extended maturity date											Jun. 30, 2023	Jun. 30, 2023
Warrants additional life term											1 year 8 months 1 day	1 year 8 months 1 day
Amortization of debt discount											$ 844,425	$ 844,425
Warrants exercise price		$ 5
Warrant maturity date		Dec. 31, 2024
Debt instrument, interest rate, effective percentage		11.00%
Warrant issued value		$ 10
Number of new warrants		177,500
Secured Promissory Notes [Member]
Debt Instrument [Line Items]
Debt instrument, interest rate	7.50%		6.75%
Maturity date			Jul. 05, 2023
Extended maturity date	Sep. 05, 2023
Secured promissory note			$ 501,006
Minimum [Member] | Senior secured notes [Member]
Debt Instrument [Line Items]
Debt instrument, interest rate											10.00%	10.00%
Maximum [Member] | Senior secured notes [Member]
Debt Instrument [Line Items]
Debt instrument, interest rate											11.00%	11.00%
Fixed Rate [Member]
Debt Instrument [Line Items]
Debt weighted average interest rate											4.15%	3.87%
Debt term											12 years 1 month 28 days	12 years 9 months 29 days
Variable Rate [Member]
Debt Instrument [Line Items]
Debt weighted average interest rate											5.75%	3.53%
Debt term											14 years 1 month 9 days	15 years 3 months

v3.24.3

OTHER CURRENT LIABILITIES (Details Narrative)	Dec. 31, 2021 USD ($)
Other Liabilities Disclosure [Abstract]
Other current liability	$ 931,446

v3.24.3

SCHEDULE OF COMMON STOCK WARRANTS ACTIVITY (Details) - Warrant [Member] - $ / shares	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Accumulated Other Comprehensive Income (Loss) [Line Items]
Number of Warrants, Beginning Balance	206,000	206,000
Weighted Average Exercise Price, Beginning Balance	$ 5.00	$ 5.00
Number of Warrants, Issued	177,500
Weighted Average Exercise Price, Issued
Number of Warrants, Cancelled
Weighted Average Exercise Price, Cancelled
Number of Warrants, Exercised
Weighted Average Exercise Price, Exercised
Number of Warrants, Expired	(206,000)
Weighted Average Exercise Price, Expired
Number of Warrants, Ending Balance	177,500	206,000
Weighted Average Exercise Price, Ending Balance	$ 5.00	$ 5.00

v3.24.3

SCHEDULE OF COMMON STOCK OPTIONS ACTIVITY (Details) - $ / shares	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Equity [Abstract]
Number of Options, Beginning Balance	30,000	30,000
Weighted Average Exercise Price, Beginning Balance	$ 6.00	$ 6.00
Number of Options, Issued
Weighted Average Exercise Price, Issued
Number of Options, Cancelled
Weighted Average Exercise Price, Cancelled
Number of Options, Exercised
Weighted Average Exercise Price, Exercised
Number of Options, Expired
Weighted Average Exercise Price, Expired
Number of Options, Ending Balance	30,000	30,000
Weighted Average Exercise Price, Ending Balance	$ 6.00	$ 6.00

v3.24.3

STOCKHOLDERS’ EQUITY (Details Narrative) - USD ($)		12 Months Ended
	Jan. 06, 2022	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2021
Class of Stock [Line Items]
Preferred stock, shares authorized		10,000,000
Preferred dividend		$ 30,000	$ 30,000
Common stock, shares authorized		800,000,000	800,000,000
Common stock, par value		$ 0.05	$ 0.05
Common stock, shares outstanding		3,067,059	3,067,059
Shares issued option to purchase shares of common stock	30,000	30,000	30,000
Weighted average exercise price	$ 6.00	$ 6.00	$ 6.00	$ 6.00
Aggregate intrinsic value		$ 0	$ 0
Warrant [Member]
Class of Stock [Line Items]
Warrants to purchase common stock		177,500	206,000
Weighted average exercise price		$ 5.00	$ 5.00
Common stock warrants term		6 months	1 year 8 months 1 day
Aggregate intrinsic value of common stock warrants outstanding		$ 0	$ 0
Board of Directors Chairman [Member]
Class of Stock [Line Items]
Common stock, shares authorized		50,000,000
Common stock, par value		$ 0.05
Common stock, shares outstanding		3,054,587	3,054,587
Series A Convertible Redeemable Preferred Stock [Member]
Class of Stock [Line Items]
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]
Class of Stock [Line Items]
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 dividend		$ 6,900	$ 30,000
Dividends payable		$ 7,500	$ 7,500

v3.24.3

SCHEDULE OF LEASING ARRANGEMENTS (Details) - Goodwill Hunting LLC [Member]	12 Months Ended
	Dec. 31, 2023 USD ($)
Defined Benefit Plan Disclosure [Line Items]
Monthly lease income	$ 52,976	[1]
Lease expiration date	Feb. 01, 2027
Lease renewal option	Term may be extended for one additional five-year term
[1] The lease became effective on February 1, 2017, and the facility began generating rental revenue thereafter.

v3.24.3

SCHEDULE OF FUTURE CASH PAYMENTS FOR RENT RECEIVED DURING INITIAL TERM OF LEASE (Details)	Dec. 31, 2023 USD ($)
Facility Leases
2024	$ 643,401
2025	651,954
2026	660,665
2027 and Thereafter	55,116
Total	$ 2,011,136

v3.24.3

SCHEDULE OF INCOME TAX EXPENSES (Details) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Income Tax Disclosure [Abstract]
Current Federal
Current State
Deferred Federal
Deferred State
Total Income Tax Expense

v3.24.3

SCHEDULE OF EFFECTIVE INCOME TAX RATE RECONCILIATION (Details)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Income Tax Disclosure [Abstract]
Statutory Federal Income Tax Rate	21.00%	21.00%
Prior Year True-ups	(22.00%)	(89.00%)
Permanent Difference	33.00%	(4.00%)
State Taxes	10.00%	4.00%
Change in Valuation Allowance	(42.00%)	68.00%
Effective tax rate

v3.24.3

SCHEDULE OF DEFERRED TAX ASSETS (Details) - USD ($)	Dec. 31, 2023	Dec. 31, 2022
Income Tax Disclosure [Abstract]
Net Operating Loss Carryforwards	$ 2,781,168	$ 2,296,982
Impairment Loss on Long Term Assets	390,295	393,026
Interest Expense	485,044
Bad Debt Allowance	545,768
Deferred Tax Assets	4,202,275	2,690,008
Property and Equipment	(1,391,332)	(1,502,934)
Other	(9,478)	(8,807)
Deferred Tax Liabilities	(1,400,810)	(1,511,741)
Valuation Allowance	(2,801,465)	(1,178,267)
Net Deferred Tax Asset

v3.24.3

SCHEDULE OF UNRECOGNIZED TAX LIABILITIES (Details) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Income Tax Disclosure [Abstract]
Unrecognized tax liabilities, beginning of the year	$ 454,439
Increase (decrease) related to prior year tax positions	(454,439)	478,988
Increase (decrease) related to current year tax positions		(24,549)
Unrecognized tax liabilities, end of the year		$ 454,439

v3.24.3

INCOME TAXES (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2021	Dec. 31, 2022
Effective Income Tax Rate Reconciliation [Line Items]
Expiration year	2037
Limitations on use	subject to the 80% taxable income limitation
Bad debt allowance		$ 1,901,203
Unrecognized tax benefits			$ 454,439
Tax Year 2013 [Member]
Effective Income Tax Rate Reconciliation [Line Items]
Operating loss carryforwards	4,047,175
Domestic Tax Jurisdiction [Member]
Effective Income Tax Rate Reconciliation [Line Items]
Operating loss carryforwards	10,208,276		4,223,130
Operating loss not used	630,913		630,913
Operating loss remaining	9,577,363
State and Local Jurisdiction [Member]
Effective Income Tax Rate Reconciliation [Line Items]
Operating loss carryforwards	$ 15,670,635		$ 10,467,971

v3.24.3

SCHEDULE OF ACTIVITIES IN GOODWILL (Details) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
Opening Balance	$ 1,076,908	$ 1,076,908
Goodwill acquired
Closing Balance	$ 1,076,908	$ 1,076,908

v3.24.3

GOODWILL (Details Narrative) - USD ($)	12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill impairment loss	$ 0	$ 0

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