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ý
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Georgia
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31-1332119
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(State or other jurisdiction
of incorporation)
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(I.R.S. Employer Identification Number)
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Large accelerated filer
o
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Accelerated filer
o
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Non-accelerated filer
o
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Smaller reporting company
x
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(Do not check if a smaller reporting company)
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Page
Number
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March 31,
2016 |
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December 31,
2015 |
||||
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(Unaudited)
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|
||||
ASSETS
|
|
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Current assets:
|
|
|
|
|
|
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Cash and cash equivalents
|
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$
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2,264
|
|
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$
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2,720
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Restricted cash
|
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5,403
|
|
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9,169
|
|
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Accounts receivable, net of allowance of $11,276 and $12,487
|
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8,558
|
|
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8,805
|
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Prepaid expenses and other
|
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3,425
|
|
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3,214
|
|
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Assets of disposal group held for sale
|
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1,237
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|
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1,249
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Total current assets
|
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20,887
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|
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25,157
|
|
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Restricted cash and investments
|
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3,485
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3,558
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Property and equipment, net
|
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124,835
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126,676
|
|
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Intangible assets - bed licenses
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2,471
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2,471
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Intangible assets - lease rights, net
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3,254
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3,420
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Goodwill
|
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4,183
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4,183
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|
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Lease deposits
|
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1,414
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1,812
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Other assets
|
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2,714
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|
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1,996
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Total assets
|
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$
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163,243
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|
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$
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169,273
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LIABILITIES AND DEFICIT
|
|
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|
|
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Current liabilities:
|
|
|
|
|
|
|
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Current portion of notes payable and other debt
|
|
$
|
46,919
|
|
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$
|
50,960
|
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Accounts payable
|
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7,046
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|
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8,741
|
|
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Accrued expenses
|
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2,327
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3,125
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|
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Liabilities of disposal group held for sale
|
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949
|
|
|
958
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Total current liabilities
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57,241
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|
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63,784
|
|
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Notes payable and other debt, net of current portion:
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|
|
|
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|
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Senior debt, net
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54,479
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|
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54,742
|
|
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Bonds, net
|
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6,618
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6,600
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|
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Convertible debt, net
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9,010
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|
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8,968
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|
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Other debt, net
|
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413
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|
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531
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|
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Other liabilities
|
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4,096
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|
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3,380
|
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Deferred tax liability
|
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389
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|
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389
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Total liabilities
|
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132,246
|
|
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138,394
|
|
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Commitments and contingencies (Note 14)
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|
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|
|
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Preferred stock, no par value; 5,000 shares authorized; 2,614 and 2,427 shares issued and outstanding, redemption amount $65,346 and $60,273 at March 31, 2016 and December 31, 2015, respectively
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58,391
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|
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54,714
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|
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Stockholders’ equity:
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|
|
|
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|
|
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Common stock and additional paid-in capital, no par value; 55,000 shares authorized; 19,907 and 19,861 issued and outstanding at March 31, 2016 and December 31, 2015, respectively
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61,126
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|
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60,958
|
|
||
Accumulated deficit
|
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(88,520
|
)
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|
(84,793
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)
|
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Total stockholders’ deficit
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(27,394
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)
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(23,835
|
)
|
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Total liabilities and stockholders' deficit
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$
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163,243
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$
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169,273
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Three Months Ended March 31,
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||||||
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2016
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2015
|
||||
Revenues:
|
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Rental revenues
|
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$
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6,849
|
|
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$
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1,340
|
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Management fee and other revenues
|
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233
|
|
|
218
|
|
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Total revenues
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7,082
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|
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1,558
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Expenses:
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General and administrative expense
|
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2,542
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|
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3,331
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Facility rent expense
|
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2,179
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|
487
|
|
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Depreciation and amortization
|
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1,713
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|
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1,675
|
|
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Other expenses
|
|
203
|
|
|
102
|
|
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Total expenses
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6,637
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5,595
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|
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Income (loss) from operations
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445
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(4,037
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)
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|
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|
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|
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Other expense:
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|
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|
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|
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Interest expense, net
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1,825
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|
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2,490
|
|
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Loss on extinguishment of debt
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|
—
|
|
|
680
|
|
||
Other expense
|
|
42
|
|
|
288
|
|
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Total other expense, net
|
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1,867
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|
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3,458
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|
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|
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|
||||
Loss from continuing operations before income taxes
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(1,422
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)
|
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(7,495
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)
|
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Income tax expense
|
|
—
|
|
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20
|
|
||
Loss from continuing operations
|
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(1,422
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)
|
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(7,515
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)
|
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|
|
|
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|
||||
Income (loss) from discontinued operations, net of tax
|
|
(528
|
)
|
|
2,266
|
|
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Net loss
|
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(1,950
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)
|
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(5,249
|
)
|
||
|
|
|
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|
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Net loss attributable to noncontrolling interests
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—
|
|
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230
|
|
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Net loss attributable to AdCare Health Systems, Inc.
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(1,950
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)
|
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(5,019
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)
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||
|
|
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|
||||
Preferred stock dividends
|
|
(1,777
|
)
|
|
(646
|
)
|
||
Net loss attributable to AdCare Health Systems, Inc. Common Stockholders
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$
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(3,727
|
)
|
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$
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(5,665
|
)
|
|
|
|
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|
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Net loss (income) per share of common stock attributable to AdCare Health Systems, Inc.
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|
|
|
|
|
|
||
Basic and diluted:
|
|
|
|
|
|
|
||
Continuing operations
|
|
$
|
(0.16
|
)
|
|
$
|
(0.42
|
)
|
Discontinued operations
|
|
(0.03
|
)
|
|
0.13
|
|
||
|
|
$
|
(0.19
|
)
|
|
$
|
(0.29
|
)
|
|
|
|
|
|
||||
Weighted average shares of common stock outstanding:
|
|
|
|
|
|
|
||
Basic and diluted
|
|
19,885
|
|
|
19,218
|
|
|
|
Shares of Common Stock
|
|
Common Stock and Additional
Paid-in Capital |
|
Accumulated
Deficit |
|
Total
|
|||||||
Balances, December 31, 2015
|
|
19,861
|
|
|
$
|
60,958
|
|
|
$
|
(84,793
|
)
|
|
$
|
(23,835
|
)
|
|
|
|
|
|
|
|
|
|
|||||||
Stock-based compensation
|
|
—
|
|
|
480
|
|
|
—
|
|
|
480
|
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Common stock repurchase program
|
|
(150
|
)
|
|
(312
|
)
|
|
—
|
|
|
(312
|
)
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Issuance of restricted stock
|
|
196
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Preferred stock dividends
|
|
—
|
|
|
—
|
|
|
(1,777
|
)
|
|
(1,777
|
)
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Net loss
|
|
—
|
|
|
—
|
|
|
(1,950
|
)
|
|
(1,950
|
)
|
|||
Balances, March 31, 2016
|
|
19,907
|
|
|
$
|
61,126
|
|
|
$
|
(88,520
|
)
|
|
$
|
(27,394
|
)
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2016
|
|
2015
|
||||
Cash flows from operating activities:
|
|
|
|
|
|
|
||
Net loss
|
|
$
|
(1,950
|
)
|
|
$
|
(5,249
|
)
|
(Income) loss from discontinued operations, net of tax
|
|
528
|
|
|
(2,266
|
)
|
||
Loss from continuing operations
|
|
(1,422
|
)
|
|
(7,515
|
)
|
||
Adjustments to reconcile net loss from continuing operations to net cash provided by (used in) operating activities:
|
|
|
|
|
|
|
||
Depreciation and amortization
|
|
1,713
|
|
|
1,675
|
|
||
Stock-based compensation expense
|
|
480
|
|
|
202
|
|
||
Rent expense in excess of cash paid
|
|
203
|
|
|
43
|
|
||
Rent revenue in excess of cash received
|
|
(718
|
)
|
|
(29
|
)
|
||
Amortization of deferred financing costs
|
|
216
|
|
|
350
|
|
||
Amortization of debt discounts and premiums
|
|
4
|
|
|
4
|
|
||
Loss on debt extinguishment
|
|
—
|
|
|
680
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
||||
Accounts receivable
|
|
(1,219
|
)
|
|
140
|
|
||
Prepaid expenses and other
|
|
(242
|
)
|
|
(751
|
)
|
||
Other assets
|
|
17
|
|
|
40
|
|
||
Accounts payable and accrued expenses
|
|
(590
|
)
|
|
(177
|
)
|
||
Other liabilities
|
|
617
|
|
|
90
|
|
||
Net cash used in operating activities - continuing operations
|
|
(941
|
)
|
|
(5,248
|
)
|
||
Net cash (used in) provided by operating activities - discontinued operations
|
|
(639
|
)
|
|
4,645
|
|
||
Net cash used in operating activities
|
|
(1,580
|
)
|
|
(603
|
)
|
||
|
|
|
|
|
||||
Cash flows from investing activities:
|
|
|
|
|
|
|
||
Change in restricted cash
|
|
3,839
|
|
|
705
|
|
||
Proceeds from the sale of property and equipment
|
|
325
|
|
|
—
|
|
||
Purchase of property and equipment
|
|
(19
|
)
|
|
(374
|
)
|
||
Net cash provided by investing activities - continuing operations
|
|
4,145
|
|
|
331
|
|
||
Net cash used in investing activities - discontinued operations
|
|
(1
|
)
|
|
(44
|
)
|
||
Net cash provided by investing activities
|
|
4,144
|
|
|
287
|
|
||
|
|
|
|
|
||||
Cash flows from financing activities:
|
|
|
|
|
|
|
||
Proceeds from debt
|
|
203
|
|
|
21,714
|
|
||
Proceeds from convertible debt
|
|
—
|
|
|
1,685
|
|
||
Repayment of notes payable
|
|
(4,518
|
)
|
|
(21,892
|
)
|
||
Proceeds from lines of credit
|
|
—
|
|
|
13,693
|
|
||
Repayment of lines of credit
|
|
—
|
|
|
(15,454
|
)
|
||
Debt issuance costs
|
|
(25
|
)
|
|
(511
|
)
|
||
Exercise of warrants and options
|
|
—
|
|
|
1,688
|
|
||
Proceeds from preferred stock issuances, net
|
|
3,677
|
|
|
—
|
|
||
Repurchase of common stock
|
|
(312
|
)
|
|
—
|
|
||
Dividends paid on preferred stock
|
|
(1,777
|
)
|
|
(646
|
)
|
||
Net cash (used in) provided by financing activities - continuing operations
|
|
(2,752
|
)
|
|
277
|
|
||
Net cash used in financing activities - discontinued operations
|
|
(268
|
)
|
|
(16
|
)
|
||
Net cash (used in) provided by financing activities
|
|
(3,020
|
)
|
|
261
|
|
||
Net change in cash and cash equivalents
|
|
(456
|
)
|
|
(55
|
)
|
||
Cash and cash equivalents, beginning
|
|
2,720
|
|
|
10,735
|
|
||
Cash and cash equivalents, ending
|
|
$
|
2,264
|
|
|
$
|
10,680
|
|
|
|
|
|
|
||||
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
||
Cash paid during the year for:
|
|
|
|
|
||||
Interest
|
|
$
|
1,630
|
|
|
$
|
2,407
|
|
Income taxes
|
|
$
|
—
|
|
|
$
|
20
|
|
Supplemental disclosure of non-cash activities:
|
|
|
|
|
||||
Notes issued in conjunction with financing of exit fees
|
|
$
|
—
|
|
|
$
|
680
|
|
|
|
Three Months Ended March 31,
|
||||||||||||||||||||
|
|
2016
|
|
2015
|
||||||||||||||||||
(Amounts in 000’s, except per share data)
|
|
Income
(loss) |
|
Shares
|
|
Per
Share |
|
Income
(loss) |
|
Shares
|
|
Per
Share |
||||||||||
Continuing operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Loss from continuing operations
|
|
$
|
(1,422
|
)
|
|
|
|
|
|
$
|
(7,515
|
)
|
|
|
|
|
|
|
||||
Preferred stock dividends
|
|
(1,777
|
)
|
|
|
|
|
|
(646
|
)
|
|
|
|
|
||||||||
Basic loss from continuing operations
|
|
$
|
(3,199
|
)
|
|
19,885
|
|
|
$
|
(0.16
|
)
|
|
$
|
(8,161
|
)
|
|
19,218
|
|
|
$
|
(0.42
|
)
|
Diluted loss from continuing operations
(a)
|
|
$
|
(3,199
|
)
|
|
19,885
|
|
|
$
|
(0.16
|
)
|
|
$
|
(8,161
|
)
|
|
19,218
|
|
|
$
|
(0.42
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Discontinued operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
(Loss) income from discontinued operations
|
|
$
|
(528
|
)
|
|
|
|
|
|
$
|
2,266
|
|
|
|
|
|
||||||
Net loss attributable to noncontrolling interests
|
|
—
|
|
|
|
|
|
|
230
|
|
|
|
|
|
||||||||
Basic (loss) income from discontinued operations attributable to the Company
|
|
$
|
(528
|
)
|
|
19,885
|
|
|
$
|
(0.03
|
)
|
|
$
|
2,496
|
|
|
19,218
|
|
|
$
|
0.13
|
|
Diluted (loss) income from discontinued operations attributable to the Company
(a)
|
|
$
|
(528
|
)
|
|
19,885
|
|
|
$
|
(0.03
|
)
|
|
$
|
2,496
|
|
|
19,218
|
|
|
$
|
0.13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net loss attributable to AdCare:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic loss
|
|
$
|
(3,727
|
)
|
|
19,885
|
|
|
$
|
(0.19
|
)
|
|
$
|
(5,665
|
)
|
|
19,218
|
|
|
$
|
(0.29
|
)
|
Diluted loss
(a)
|
|
$
|
(3,727
|
)
|
|
19,885
|
|
|
$
|
(0.19
|
)
|
|
$
|
(5,665
|
)
|
|
19,218
|
|
|
$
|
(0.29
|
)
|
|
|
March 31,
|
||||
(Share amounts in 000’s)
|
|
2016
|
|
2015
|
||
Stock options
|
|
373
|
|
|
894
|
|
Warrants
|
|
2,051
|
|
|
2,266
|
|
Subordinated convertible notes
|
|
2,165
|
|
|
3,804
|
|
Total anti-dilutive securities
|
|
4,589
|
|
|
6,964
|
|
(Amounts in 000’s)
|
|
March 31, 2016
|
|
December 31, 2015
|
||||
Cash collateral and certificates of deposit, current
|
|
$
|
3,823
|
|
|
$
|
7,687
|
|
Current replacement reserves
|
|
1,036
|
|
|
950
|
|
||
Escrow deposits
|
|
544
|
|
|
532
|
|
||
Total current portion
|
|
5,403
|
|
|
9,169
|
|
||
|
|
|
|
|
||||
Restricted investments for other debt obligations
|
|
1,940
|
|
|
2,264
|
|
||
HUD replacement reserves
|
|
1,167
|
|
|
1,174
|
|
||
Reserves for capital improvements
|
|
378
|
|
|
120
|
|
||
Total noncurrent portion
|
|
3,485
|
|
|
3,558
|
|
||
Total restricted cash
|
|
$
|
8,888
|
|
|
$
|
12,727
|
|
(Amounts in 000’s)
|
|
Estimated Useful
Lives (Years)
|
|
March 31, 2016
|
|
December 31, 2015
|
||||
Buildings and improvements
|
|
5-40
|
|
$
|
129,062
|
|
|
$
|
128,912
|
|
Equipment
|
|
2-10
|
|
13,484
|
|
|
13,470
|
|
||
Land
|
|
—
|
|
6,810
|
|
|
7,128
|
|
||
Computer related
|
|
2-10
|
|
3,000
|
|
|
2,999
|
|
||
Construction in process
|
|
—
|
|
186
|
|
|
390
|
|
||
|
|
|
|
152,542
|
|
|
152,899
|
|
||
Less: accumulated depreciation and amortization
|
|
|
|
(27,707
|
)
|
|
(26,223
|
)
|
||
Property and equipment, net
|
|
|
|
$
|
124,835
|
|
|
$
|
126,676
|
|
(Amounts in 000’s)
|
|
CON (included in property and equipment)
|
|
Bed Licenses - Separable
|
|
Lease Rights
|
|
Total
|
||||||||
Balances, December 31, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gross
|
|
$
|
35,690
|
|
|
$
|
2,471
|
|
|
$
|
6,881
|
|
|
$
|
45,042
|
|
Accumulated amortization
|
|
(4,760
|
)
|
|
—
|
|
|
(3,461
|
)
|
|
(8,221
|
)
|
||||
Net carrying amount
|
|
$
|
30,930
|
|
|
$
|
2,471
|
|
|
$
|
3,420
|
|
|
$
|
36,821
|
|
|
|
|
|
|
|
|
|
|
||||||||
Amortization expense
|
|
(293
|
)
|
|
—
|
|
|
(167
|
)
|
|
(460
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Balances, March 31, 2016
|
|
|
|
|
|
|
|
|
||||||||
Gross
|
|
35,690
|
|
|
2,471
|
|
|
6,881
|
|
|
45,042
|
|
||||
Accumulated amortization
|
|
(5,053
|
)
|
|
—
|
|
|
(3,628
|
)
|
|
(8,681
|
)
|
||||
Net carrying amount
|
|
$
|
30,637
|
|
|
$
|
2,471
|
|
|
$
|
3,253
|
|
|
$
|
36,361
|
|
(Amounts in 000’s)
|
|
Bed Licenses
|
|
Lease Rights
|
||||
2016
(a)
|
|
$
|
880
|
|
|
$
|
500
|
|
2017
|
|
1,173
|
|
|
667
|
|
||
2018
|
|
1,173
|
|
|
667
|
|
||
2019
|
|
1,173
|
|
|
667
|
|
||
2020
|
|
1,173
|
|
|
482
|
|
||
Thereafter
|
|
25,065
|
|
|
270
|
|
||
Total expected amortization expense
|
|
$
|
30,637
|
|
|
$
|
3,253
|
|
(Amounts in 000’s)
|
|
March 31, 2016
|
|
December 31, 2015
|
||||
Goodwill
|
|
$
|
5,023
|
|
|
$
|
5,023
|
|
Accumulated impairment losses
|
|
(840
|
)
|
|
(840
|
)
|
||
Net carrying amount
|
|
$
|
4,183
|
|
|
$
|
4,183
|
|
|
|
(Amounts in
000's) |
||
2016
(a)
|
|
$
|
6,006
|
|
2017
|
|
8,158
|
|
|
2018
|
|
8,340
|
|
|
2019
|
|
8,526
|
|
|
2020
|
|
8,697
|
|
|
Thereafter
|
|
55,320
|
|
|
Total
|
|
$
|
95,047
|
|
|
|
(Amounts in
000's) |
||
2016
(a)
|
|
$
|
19,725
|
|
2017
|
|
26,845
|
|
|
2018
|
|
27,474
|
|
|
2019
|
|
28,082
|
|
|
2020
|
|
27,634
|
|
|
Thereafter
|
|
204,913
|
|
|
Total
|
|
$
|
334,673
|
|
(Amounts in 000’s)
|
|
March 31, 2016
|
|
December 31, 2015
|
||||
Payroll related
|
|
$
|
395
|
|
|
$
|
684
|
|
Employee benefits
|
|
306
|
|
|
648
|
|
||
Real estate and other taxes
|
|
295
|
|
|
411
|
|
||
Self-insured reserve
|
|
248
|
|
|
221
|
|
||
Accrued interest
|
|
474
|
|
|
484
|
|
||
Other accrued expenses
|
|
609
|
|
|
677
|
|
||
Total accrued expenses
|
|
$
|
2,327
|
|
|
$
|
3,125
|
|
Amounts in (000's)
|
|
March 31, 2016
|
|
December 31, 2015
|
||||
Senior debt—guaranteed by HUD
|
|
$
|
25,323
|
|
|
$
|
25,469
|
|
Senior debt—guaranteed by USDA
|
|
26,286
|
|
|
26,463
|
|
||
Senior debt—guaranteed by SBA
|
|
3,508
|
|
|
3,548
|
|
||
Senior debt—bonds, net of discount
|
|
7,028
|
|
|
7,025
|
|
||
Senior debt—other mortgage indebtedness
|
|
46,985
|
|
|
51,128
|
|
||
Other debt
|
|
2,562
|
|
|
2,638
|
|
||
Convertible debt
|
|
9,200
|
|
|
9,200
|
|
||
Deferred financing costs
|
|
$
|
(2,504
|
)
|
|
$
|
(2,712
|
)
|
Total debt
|
|
$
|
118,388
|
|
|
$
|
122,759
|
|
Current debt
|
|
46,919
|
|
|
50,960
|
|
||
Debt included in liabilities of disposal group held for sale
|
|
949
|
|
|
958
|
|
||
Notes payable and other debt, net of current portion
|
|
$
|
70,520
|
|
|
$
|
70,841
|
|
(a)
|
United States ("U.S.") Department of Housing and Urban Development ("HUD"), U.S. Department of Agriculture("USDA"), U.S. Small Business Administration ("SBA").
|
Amounts in (000's)
|
|
|
|
|
|
|
|
|
March 31,
|
|
December 31,
|
||||||
Facility
|
|
Lender
|
|
Maturity
|
|
Interest Rate
(a)
|
|
2016
|
|
2015
|
|||||||
Senior debt - guaranteed by HUD
|
|
|
|
|
|
|
|
|
|
|
|||||||
The Pavilion Care Center
|
|
Red Mortgage
|
|
12/01/2027
|
|
Fixed
|
|
4.16%
|
|
$
|
1,510
|
|
|
$
|
1,534
|
|
|
Hearth and Care of Greenfield
|
|
Red Mortgage
|
|
08/01/2038
|
|
Fixed
|
|
4.20%
|
|
2,236
|
|
|
2,251
|
|
|||
Woodland Manor
|
|
Heartland Bank
|
|
10/01/2044
|
|
Fixed
|
|
3.75%
|
|
5,529
|
|
|
5,556
|
|
|||
Glenvue
|
|
Heartland Bank
|
|
10/01/2044
|
|
Fixed
|
|
3.75%
|
|
8,585
|
|
|
8,628
|
|
|||
Autumn Breeze
|
|
KeyBank
|
|
01/01/2045
|
|
Fixed
|
|
3.65%
|
|
7,463
|
|
|
7,500
|
|
|||
|
Total
|
|
|
|
|
|
|
|
|
|
$
|
25,323
|
|
|
$
|
25,469
|
|
Senior debt - guaranteed by USDA
|
|
|
|
|
|
|
|
|
|||||||||
Attalla
|
|
Metro City
|
|
09/30/2035
|
|
Prime + 1.50%
|
|
5.50%
|
|
$
|
7,348
|
|
|
$
|
7,400
|
|
|
Coosa
|
|
Metro City
|
|
09/30/2035
|
|
Prime + 1.50%
|
|
5.50%
|
|
6,625
|
|
|
6,671
|
|
|||
Mountain Trace
|
|
Community B&T
|
|
01/24/2036
|
|
Prime + 1.75%
|
|
5.75%
|
|
4,476
|
|
|
4,507
|
|
|||
Southland
|
|
Bank of Atlanta
|
|
07/27/2036
|
|
Prime + 1.50%
|
|
6.00%
|
|
4,548
|
|
|
4,576
|
|
|||
Homestead
|
|
Square 1
|
|
10/14/2036
|
|
Prime + 1.00%
|
|
5.75%
|
|
3,289
|
|
|
3,309
|
|
|||
|
Total
|
|
|
|
|
|
|
|
|
|
$
|
26,286
|
|
|
$
|
26,463
|
|
Senior debt - guaranteed by SBA
|
|
|
|
|
|
|
|
|
|||||||||
College Park
|
|
CDC
|
|
10/01/2031
|
|
Fixed
|
|
2.81%
|
|
$
|
1,676
|
|
|
$
|
1,697
|
|
|
Stone County
|
|
CDC
|
|
07/01/2032
|
|
Fixed
|
|
2.42%
|
|
1,109
|
|
|
1,123
|
|
|||
Southland
|
|
Bank of Atlanta
|
|
07/27/2036
|
|
Prime + 2.25%
|
5.75%
|
|
723
|
|
|
728
|
|
||||
|
Total
|
|
|
|
|
|
|
|
|
|
$
|
3,508
|
|
|
$
|
3,548
|
|
(a)
|
Represents cash interest rates as of
March 31, 2016
as adjusted for applicable interest rate floor limitations within the lender agreements. The rates exclude amortization of deferred financing costs which range from 0.08% to 1.92% per annum.
|
(a)
|
Represents cash interest rates as of
March 31, 2016
as adjusted for applicable interest rate floor limitations within the lender agreements. The rates exclude amortization of deferred financing costs which range from
0.08%
to
1.92%
per annum.
|
(a)
|
Represents cash interest rates as of
March 31, 2016
as adjusted for applicable interest rate floor limitations within the lender agreements. The rates exclude amortization of deferred financing costs which range from 0.08% to 1.92% per annum.
|
(b)
|
On March 24, 2016, the Company received a commitment from a lender to refinance the Bentonville, Heritage Park and River Valley Credit Facility (under which only two facilities remain financed upon the sale of the Bentonville facility in 2015), the Little Rock Credit Facility, and the Northridge, Woodland Hills and Abington Credit Facility for a combined total of
$25.4 million
of debt subject to definitive documentation and certain closing conditions.
|
(c)
|
On March 24, 2016, the Company obtained a lender commitment to extend the maturity date of the Georgetown and Sumter Credit Facility from September 2016 to June 2017 subject to definitive documentation and certain closing conditions.
|
(d)
|
On March 24, 2016, the Company obtained the release of approximately
$3.9 million
of restricted cash funds and applied the amounts as additional principal payments related to certain of the above debt facilities with Private Bank.
|
(e)
|
On March 29, 2016, the Company obtained a lender commitment to extend the maturity date of the Quail Creek Credit facility from September 2016 to September 2018 subject to definitive documentation and certain closing conditions.
|
Amounts in (000's)
|
|
|
|
|
|
|
|
|
|
|
||||
Lender
|
|
Maturity
|
|
Interest Rate
(a)
|
|
March 31, 2016
|
|
December 31, 2015
|
||||||
Other debt
|
|
|
|
|
|
|
|
|
|
|
||||
First Insurance Funding
|
|
02/29/2017
|
|
Fixed
|
|
3.99%
|
|
$
|
206
|
|
|
$
|
14
|
|
Key Bank
|
|
08/25/2016
|
|
Fixed
|
|
—
|
|
680
|
|
|
680
|
|
||
Reliant Rehabilitation
|
|
11/15/2016
|
|
Fixed
|
|
7.00%
|
|
758
|
|
|
944
|
|
||
Pharmacy Care of Arkansas
|
|
02/08/2018
|
|
Fixed
|
|
2.00%
|
|
918
|
|
|
1,000
|
|
||
Total
|
|
|
|
|
|
|
|
$
|
2,562
|
|
|
$
|
2,638
|
|
(a)
|
Represents cash interest rates as of
March 31, 2016
in accordance with the lender agreements. The rates exclude amortization of deferred financing costs which range from
0.08%
to
1.92%
per annum.
|
Amounts in (000's)
|
|
|
|
|
|
|
|
|
|
|
|||||
Facility
|
|
Maturity
|
|
Interest Rate
(a)
|
|
March 31, 2016
|
|
December 31, 2015
|
|||||||
Convertible debt
|
|
|
|
|
|
|
|
|
|
|
|||||
Issued July 2012
|
|
10/31/2017
|
|
Fixed
|
|
10.00%
|
|
$
|
1,500
|
|
|
$
|
1,500
|
|
|
Issued March 2015
|
|
04/30/2017
|
|
Fixed
|
|
10.00%
|
|
7,700
|
|
|
7,700
|
|
|||
|
Total
|
|
|
|
|
|
|
|
$
|
9,200
|
|
|
$
|
9,200
|
|
(a)
|
Represents cash interest rates as of
March 31, 2016
in accordance with the lender agreements.The rates exclude amortization of deferred financing costs which range from
0.08%
to
1.92%
per annum.
|
|
|
Three Months Ended March 31,
|
||||||
(Amounts in 000’s)
|
|
2016
|
|
2015
|
||||
Total revenues
|
|
$
|
—
|
|
|
$
|
46,862
|
|
Cost of services
|
|
519
|
|
|
42,930
|
|
||
Net income (loss)
|
|
(528
|
)
|
|
2,266
|
|
||
Interest expense, net
|
|
8
|
|
|
313
|
|
(Amounts in 000’s)
|
|
March 31, 2016
|
|
December 31, 2015
|
||||
Property and equipment, net
|
|
$
|
1,237
|
|
|
$
|
1,249
|
|
Assets of disposal groups held for sale
|
|
$
|
1,237
|
|
|
$
|
1,249
|
|
|
|
|
|
|
||||
Notes payable
|
|
$
|
949
|
|
|
$
|
958
|
|
Liabilities of disposal group held for sale
|
|
$
|
949
|
|
|
$
|
958
|
|
|
|
Shares Issued & Outstanding
|
Net Proceeds from Issuance (in 000's)
|
Dividends Paid (in 000's)
|
|||||
Balances, December 31, 2015
|
|
2,426,930
|
|
$
|
54,714
|
|
|
||
|
|
|
|
|
|||||
At-The-Market offering
|
|
186,905
|
|
$
|
3,677
|
|
|
||
Dividends paid during 2016
|
|
|
|
$
|
1,777
|
|
|||
|
|
|
|
|
|||||
Balances, March 31, 2016
|
|
2,613,835
|
|
$
|
58,391
|
|
|
|
|
Three Months Ended March 31,
|
||||||
(Amounts in 000’s)
|
|
2016
|
|
2015
|
||||
Employee compensation:
|
|
|
|
|
|
|
||
Restricted stock
|
|
$
|
111
|
|
|
$
|
63
|
|
Stock options
|
|
85
|
|
|
44
|
|
||
Warrants
|
|
246
|
|
|
33
|
|
||
Total employee stock-based compensation expense
|
|
$
|
442
|
|
|
$
|
140
|
|
Non-employee compensation:
|
|
|
|
|
|
|||
Board restricted stock
|
|
$
|
26
|
|
|
$
|
51
|
|
Board stock options
|
|
12
|
|
|
12
|
|
||
Total non-employee stock-based compensation expense
|
|
$
|
38
|
|
|
$
|
63
|
|
Total stock-based compensation expense
|
$
|
480
|
|
|
$
|
203
|
|
•
|
The 2011 Stock Incentive Plan, which expires March 28, 2021 and provides for a maximum of
2,152,500
shares of common stock to be issued.
|
|
Three Months Ended March 31,
|
||||
|
2016
|
|
2015
|
||
Dividend yield
|
—
|
%
|
|
—
|
%
|
Expected volatility
|
41
|
%
|
|
51
|
%
|
Risk-free interest rate
|
1.43
|
%
|
|
1.73
|
%
|
Expected term
|
5.0 years
|
|
|
5.2 years
|
|
|
|
Number of Shares
|
|
Weighted Average Exercise Price
|
|
Weighted Average Remaining Contractual Term (in years)
|
|
Aggregate Intrinsic Value (in 000's)
|
|||||
Outstanding, December 31, 2015
|
266,514
|
|
|
$
|
3.96
|
|
|
|
|
|
|||
|
Granted
|
141,507
|
|
|
$
|
2.07
|
|
|
|
|
|
||
|
Exercised
|
—
|
|
|
$
|
—
|
|
|
|
|
|
||
|
Forfeited
|
(8,334
|
)
|
|
$
|
4.06
|
|
|
|
|
|
||
|
Expired
|
(26,250
|
)
|
|
$
|
3.93
|
|
|
|
|
|
||
Outstanding, March 31, 2016
|
373,437
|
|
|
$
|
3.24
|
|
|
6.0
|
|
$
|
37
|
|
|
Vested at March 31, 2016
|
298,946
|
|
|
$
|
3.07
|
|
|
5.4
|
|
$
|
37
|
|
|
Stock Options Outstanding
|
|
Options Exercisable
|
||||||||||||
Exercise Price
|
Number of Shares
|
|
Weighted Average Remaining Contractual Term (in years)
|
|
Weighted Average Exercise Price
|
|
Vested at March 31, 2016
|
|
Weighted Average Exercise Price
|
||||||
$1.30
|
1,989
|
|
|
0.1
|
|
$
|
1.30
|
|
|
1,989
|
|
|
$
|
1.30
|
|
$1.31 - $3.99
|
289,337
|
|
|
6.0
|
|
$
|
3.01
|
|
|
220,183
|
|
|
$
|
2.73
|
|
$4.00 - $4.30
|
82,111
|
|
|
6.0
|
|
$
|
4.11
|
|
|
76,774
|
|
|
$
|
4.09
|
|
Total
|
373,437
|
|
|
6.0
|
|
$
|
3.24
|
|
|
298,946
|
|
|
$
|
3.07
|
|
|
|
Number of Shares
|
|
Weighted Average Exercise Price
|
|
Weighted Average Remaining Contractual Term (in years)
|
|
Aggregate Intrinsic Value (in 000's)
|
|||||
Outstanding, December 31, 2015
|
2,051,475
|
|
|
$
|
3.46
|
|
|
|
|
|
|||
|
Granted
|
—
|
|
|
$
|
—
|
|
|
|
|
|
||
|
Exercised
|
—
|
|
|
$
|
—
|
|
|
|
|
|
||
|
Forfeited
|
—
|
|
|
$
|
—
|
|
|
|
|
|
||
|
Expired
|
—
|
|
|
$
|
—
|
|
|
|
|
|
||
Outstanding, March 31, 2016
|
2,051,475
|
|
|
$
|
3.46
|
|
|
4.5
|
|
$
|
249
|
|
|
Vested at March 31, 2016
|
1,576,475
|
|
|
$
|
3.19
|
|
|
3.2
|
|
$
|
249
|
|
|
Warrants Outstanding
|
|
Warrants Exercisable
|
||||||||||||
Exercise Price
|
Number of Shares
|
|
Weighted Average Remaining Contractual Term (in years)
|
|
Weighted Average Exercise Price
|
|
Vested at March 31, 2016
|
|
Weighted Average Exercise Price
|
||||||
$0 - $1.99
|
327,664
|
|
|
1.6
|
|
$
|
1.56
|
|
|
327,664
|
|
|
$
|
1.56
|
|
$2.00 - $2.99
|
335,354
|
|
|
2.3
|
|
$
|
2.58
|
|
|
335,354
|
|
|
$
|
2.58
|
|
$3.00 - $3.99
|
500,355
|
|
|
3.6
|
|
$
|
3.59
|
|
|
500,355
|
|
|
$
|
3.59
|
|
$4.00 - $4.99
|
864,769
|
|
|
7.0
|
|
$
|
4.37
|
|
|
389,769
|
|
|
$
|
4.40
|
|
$5.00 - $5.90
|
23,333
|
|
|
7.1
|
|
$
|
5.90
|
|
|
23,333
|
|
|
$
|
5.90
|
|
Total
|
2,051,475
|
|
|
4.5
|
|
$
|
3.46
|
|
|
1,576,475
|
|
|
$
|
3.19
|
|
|
|
Number of Shares
|
|
Weighted Avg. Grant Date Fair Value
|
|||
Unvested at December 31, 2015
|
294,021
|
|
|
$
|
4.19
|
|
|
|
Granted
|
196,251
|
|
|
$
|
2.14
|
|
|
Vested
|
(53,141
|
)
|
|
$
|
2.07
|
|
|
Forfeited
|
—
|
|
|
$
|
—
|
|
Unvested at March 31, 2016
|
437,131
|
|
|
$
|
3.53
|
|
|
|
Owned
|
|
Leased
|
|
Managed for Third Parties
|
|
Total
|
||||||||||||||||
|
|
Facilities
|
|
Beds/Units
|
|
Facilities
|
|
Beds/Units
|
|
Facilities
|
|
Beds/Units
|
|
Facilities
|
|
Beds/Units
|
||||||||
State
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Arkansas
|
|
9
|
|
|
958
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
958
|
|
Alabama
|
|
2
|
|
|
304
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
304
|
|
Georgia
|
|
4
|
|
|
463
|
|
|
10
|
|
|
1,168
|
|
|
—
|
|
|
—
|
|
|
14
|
|
|
1,631
|
|
North Carolina
|
|
1
|
|
|
106
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
106
|
|
Ohio
|
|
4
|
|
|
279
|
|
|
1
|
|
|
94
|
|
|
3
|
|
|
332
|
|
|
8
|
|
|
705
|
|
Oklahoma
|
|
2
|
|
|
197
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
197
|
|
South Carolina
|
|
2
|
|
|
180
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
180
|
|
Total
|
|
24
|
|
|
2,487
|
|
|
11
|
|
|
1,262
|
|
|
3
|
|
|
332
|
|
|
38
|
|
|
4,081
|
|
Facility Type
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Skilled Nursing
|
|
22
|
|
|
2,375
|
|
|
11
|
|
|
1,262
|
|
|
2
|
|
|
249
|
|
|
35
|
|
|
3,886
|
|
Assisted Living
|
|
2
|
|
|
112
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
112
|
|
Independent Living
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
83
|
|
|
1
|
|
|
83
|
|
Total
|
|
24
|
|
|
2,487
|
|
|
11
|
|
|
1,262
|
|
|
3
|
|
|
332
|
|
|
38
|
|
|
4,081
|
|
Operator Affiliation
|
|
Number of
Facilities |
|
Beds / Units
|
||
Aria Health Group / Skyline Healthcare
(1)
|
|
9
|
|
|
958
|
|
Beacon Health Management
|
|
7
|
|
|
585
|
|
C.R. Management
|
|
7
|
|
|
830
|
|
Wellington Health Services
|
|
4
|
|
|
641
|
|
New Beginnings Care
(2)
|
|
3
|
|
|
252
|
|
Symmetry Healthcare
|
|
3
|
|
|
286
|
|
Southwest LTC
|
|
2
|
|
|
197
|
|
Subtotal
|
|
35
|
|
|
3,749
|
|
AdCare Managed
|
|
3
|
|
|
332
|
|
Total
|
|
38
|
|
|
4,081
|
|
(1)
|
AdCare subleased through its subsidiaries nine facilities located in Arkansas to affiliates of Aria pursuant to separate sublease agreements. Eight of the Aria Subleases commenced on May 1, 2015 and one Aria Sublease commenced on November 1, 2015. Effective February 3, 2016, each Aria Sublease was terminated due to the failure to pay rent pursuant to the terms of such sublease. Subsequently, on February 5, 2016, the Company entered into the Skyline Lease with respect to such facilities,
|
(2)
|
On January 22, 2016, New Beginnings Care ("New Beginnings") filed a petition to reorganize its finances under the Bankruptcy Code. To date, New Beginnings has neither affirmed nor rejected the Master Lease entered into on November 3, 2015 with respect to the Jeffersonville, Oceanside, and Savannah Beach facilities. The Company is in discussions with New Beginnings and other potential operators about renting such facilities. For a more detailed discussion, see
Note 7 - Leases
, to the Company's Notes to Consolidated Financial Statements located in Part I, Item 1, of this Quarterly Report on Form 10-Q.
|
|
|
Three Months Ended March 31,
|
|
Increase (Decrease)
|
|||||||||||
(Amounts in 000’s)
|
|
2016
|
|
2015
|
|
Amount
|
|
Percent
|
|||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Rental revenues
|
|
$
|
6,849
|
|
|
$
|
1,340
|
|
|
$
|
5,509
|
|
|
411.1
|
%
|
Management fee and other revenues
|
|
233
|
|
|
218
|
|
|
15
|
|
|
6.9
|
%
|
|||
Total revenues
|
|
7,082
|
|
|
1,558
|
|
|
5,524
|
|
|
354.6
|
%
|
|||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||
General and administrative expenses
|
|
2,542
|
|
|
3,331
|
|
|
(789
|
)
|
|
(23.7
|
)%
|
|||
Facility rent expense
|
|
2,179
|
|
|
487
|
|
|
1,692
|
|
|
347.4
|
%
|
|||
Depreciation and amortization
|
|
1,713
|
|
|
1,675
|
|
|
38
|
|
|
2.3
|
%
|
|||
Other operating expenses
|
|
203
|
|
|
102
|
|
|
101
|
|
|
99.0
|
%
|
|||
Total expenses
|
|
6,637
|
|
|
5,595
|
|
|
1,042
|
|
|
18.6
|
%
|
|||
Income (loss) from operations
|
|
445
|
|
|
(4,037
|
)
|
|
4,482
|
|
|
111.0
|
%
|
|||
Other expense:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest expense, net
|
|
1,825
|
|
|
2,490
|
|
|
(665
|
)
|
|
(26.7
|
)%
|
|||
Loss on extinguishment of debt
|
|
—
|
|
|
680
|
|
|
(680
|
)
|
|
(100.0
|
)%
|
|||
Other expense
|
|
42
|
|
|
288
|
|
|
(246
|
)
|
|
(85.4
|
)%
|
|||
Total other expense, net
|
|
1,867
|
|
|
3,458
|
|
|
(1,591
|
)
|
|
(46.0
|
)%
|
|||
Loss from continuing operations before income taxes
|
|
(1,422
|
)
|
|
(7,495
|
)
|
|
(6,073
|
)
|
|
(81.0
|
)%
|
|||
Income tax benefit
|
|
—
|
|
|
20
|
|
|
20
|
|
|
(100.0
|
)%
|
|||
Loss from continuing operations
|
|
(1,422
|
)
|
|
(7,515
|
)
|
|
(6,053
|
)
|
|
(80.5
|
)%
|
|||
(Loss) income from discontinued operations, net of tax
|
|
(528
|
)
|
|
2,266
|
|
|
2,794
|
|
|
123.3
|
%
|
|||
Net loss
|
|
$
|
(1,950
|
)
|
|
$
|
(5,249
|
)
|
|
$
|
(3,259
|
)
|
|
(62.1
|
)%
|
|
|
Three Months Ended March 31,
|
||||||
(Amounts in 000’s)
|
|
2016
|
|
2015
|
||||
Net cash used in operating activities - continuing operations
|
|
$
|
(941
|
)
|
|
$
|
(5,248
|
)
|
Net cash (used in) provided by operating activities - discontinued operations
|
|
(639
|
)
|
|
4,645
|
|
||
Net cash provided by investing activities - continuing operations
|
|
4,145
|
|
|
331
|
|
||
Net cash used in investing activities - discontinued operations
|
|
(1
|
)
|
|
(44
|
)
|
||
Net cash (used in) provided by financing activities - continuing operations
|
|
(2,752
|
)
|
|
277
|
|
||
Net cash used in financing activities - discontinued operations
|
|
(268
|
)
|
|
(16
|
)
|
||
Net change in cash and cash equivalents
|
|
(456
|
)
|
|
(55
|
)
|
||
Cash and cash equivalents at beginning of period
|
|
2,720
|
|
|
10,735
|
|
||
Cash and cash equivalents at end of period
|
|
$
|
2,264
|
|
|
$
|
10,680
|
|
Period
|
|
Total Number of Shares Purchased
|
|
Average Price Paid per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plan
|
|
Maximum Number of Shares That May Yet Be Purchased
(a)
|
|||||
January 1, 2016 - January 31, 2016
|
|
150,000
|
|
|
$
|
2.05
|
|
|
150,000
|
|
|
350,000
|
|
February 1, 2016 - February 29, 2016
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
March 1, 2016 - March 31, 2016
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Total
|
|
150,000
|
|
|
$
|
2.05
|
|
|
150,000
|
|
|
350,000
|
|
•
|
should not in all instances be treated as categorical statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate;
|
•
|
have been qualified by disclosures that were made to the other party in connection with the negotiation of the applicable agreement, which disclosures are not necessarily reflected in the agreement;
|
•
|
may apply standards of materiality in a way that is different from what may be viewed as material to investors; and
|
•
|
were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement and are subject to more recent developments.
|
Exhibit No.
|
Description
|
Method of Filing
|
|
|
|
2.1
|
Purchase and Sale Agreement, by and among Valley River Property Holdings, LLC, Homestead Property Holdings, LLC, Park Heritage Property Holdings, LLC, Mt. V Property Holdings, LLC, Mountain Top Property Holdings, LLC, Little Rock HC&R Property Holdings, LLC, Woodland Hills HC Property Holdings, LLC, Northridge HC&R Property Holdings, LLC, APH&R Property Holdings, LLC, and Little Ark Realty Holdings, LLC
|
Filed herewith
|
3.1
|
Declaration of Conversion of AdCare Health Systems, Inc., an Ohio corporation, to AdCare Health Systems, Inc., a Georgia corporation
|
Incorporated by reference to Appendix A of the Registrant’s Proxy Statement on Schedule 14A filed with the Securities and Exchange Commission on October 29, 2013
|
3.2
|
Certificate of Conversion of AdCare Health Systems, Inc.
|
Incorporated by reference to Exhibit 3.2 of the Registrant’s Current report on Form 8-K filed on December 18, 2013
|
3.3
|
Certificate for Conversion for Entities Converting Within or Off the Records of the Ohio Secretary of State.
|
Incorporated by reference to Exhibit 3.1 of the Registrant’s Current report on Form 8-K filed on December 18, 2013
|
3.4
|
Articles of Incorporation of AdCare Health Systems, Inc., filed with the Secretary of State of the State of Georgia on December 12, 2013
|
Incorporated by reference to Exhibit 3.3 of the Registrant’s Current report on Form 8-K filed on December 27, 2013
|
3.5
|
Articles of Correction to Articles of Incorporation of AdCare Health Systems, Inc., filed with the Secretary of State of the State of Georgia on December 12, 2013.
|
Incorporated by reference to Exhibit 3.1 of the Registrant’s Current report on Form 8-K filed on December 27, 2013
|
3.6
|
Bylaws of AdCare Health Systems, Inc.
|
Incorporated by reference to Exhibit 3.4 of the Registrant’s Current report on Form 8-K filed on December 27, 2013
|
3.7
|
Amendment No. 1 to the Bylaws of AdCare Health Systems, Inc.
|
Incorporated by reference to Exhibit 3.7 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2013
|
3.8
|
Articles of Amendment to the Articles of Incorporation of AdCare Health Systems, Inc., as amended, filed with the Secretary of State of the State of Georgia on April 7, 2015.
|
Incorporated by reference to Exhibit 3.1 of the Registrant's Current Report on Form 8-K filed on April 13, 2015
|
3.9
|
Articles of Amendment to the Articles of Incorporation of AdCare Health Systems, Inc., as amended, filed with the Secretary of State of the State of Georgia on May 28, 2015
|
Incorporated by reference to Exhibit 3.1 of the Registrant's Current Report on Form 8-K filed on June 2, 2015
|
3.10
|
Articles of Amendment to the Articles of Incorporation of AdCare Health Systems, Inc., as amended, filed with the Secretary of State of the State of Georgia on December 11, 2015.
|
Incorporated by reference to Exhibit 3.1 of the Registrant's Current Report on Form 8-K filed on December 14, 2015
|
3.11
|
Amendment No. 2 to the Bylaws of AdCare Health Systems, Inc.
|
Incorporated by reference to Exhibit 3.2 of the Registrant's Current Report on Form 8-K filed on December 14, 2015
|
4.1
|
Specimen Common Stock Certificate of AdCare Health Systems, Inc.
|
Incorporated by reference to Exhibit 3.1 of the Registrant’s Current report on Form 8-K filed on December 18, 2013
|
4.2*
|
2004 Stock Option Plan of AdCare Health Systems, Inc.
|
Incorporated by reference to Exhibit 4.1 of the Registrant’s Registration Statement on Form S-8 (Registration No. 333-131542) filed October 27, 2011
|
4.3*
|
2005 Stock Option Plan of AdCare Health Systems, Inc.
|
Incorporated by reference to Exhibit 4.2 of the Registrant’s Registration Statement on Form S-8 (Registration No. 333-131542) filed October 27, 2011
|
4.4*
|
AdCare Health Systems, Inc. 2011 Stock Incentive Plan
|
Incorporated by reference to Exhibit 4.3 of the Registrant’s Registration Statement on Form S-8 (Registration No. 333-131542) filed October 27, 2011
|
4.5*
|
Form of Non-Statutory Stock Option Agreement
|
Incorporated by reference to Exhibit 4.4 of the Registrant’s Registration Statement on Form S-8 (Registration No. 333-131542) filed October 27, 2011
|
4.6*
|
Form of Incentive Stock Option Agreement
|
Incorporated by reference to Exhibit 4.5 of the Registrant’s Registration Statement on Form S-8 (Registration No. 333-131542) filed October 27, 2011
|
4.7
|
Form of 8% Subordinated Convertible Note Due 2015 issued by AdCare Health Systems, Inc.
|
Incorporated by reference to Exhibit 99.3 to the Registrant’s Current Report on Form 8-K filed July 5, 2012
|
4.8
|
Form of Warrant to Purchase Common Stock of the Company
|
Incorporated by reference to Exhibit 4.3 to the Registrant’s Form S-3 (File No. 333-175541)
|
4.9
|
Warrant to Purchase 50,000 Shares of Common Stock, dated December 28, 2012, issued by AdCare Health Systems, Inc. to Strome Alpha Offshore Ltd.
|
Incorporated by reference to Exhibit 4.21 of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2012
|
4.10
|
Form of Warrant, dated March 28, 2014, issued by AdCare Health Systems, Inc. to the placement agent and its affiliates in connection with the offering of 10% Subordinated Convertible Notes Due April 30, 2015
|
Incorporated by reference to Exhibit 4.3 of the Registrant's Quarterly Report on Form 10-Q for the three months ended March 31, 2014
|
4.11
|
Form of Warrant granted to management to Purchase Shares of AdCare Health Systems, Inc. dated November 20, 2007
|
Incorporated by reference to Exhibit 10.19 of the Registrant's annual report on form 10-KSB as amended March 31, 2008
|
4.12
|
Registration Rights Agreement, dated March 31, 2015, by and among AdCare Health Systems, Inc. and the Purchasers of the Company’s 10% Convertible Subordinated Notes Due April 30, 2017
|
Incorporated by reference to Exhibit 4.1 of the Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 2015
|
4.13
|
Form of 10% Convertible Subordinated Notes Due April 30, 2017
|
Incorporated by reference to Exhibit 4.2 of the Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 2015
|
4.14
|
Form of 10% Convertible Subordinated Notes Due April 30, 2017 (Affiliate Form)
|
Incorporated by reference to Exhibit 4.3 of the Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2015
|
4.15
|
Amendment to Subordinated Convertible Note Issued March 31, 2015, Dated July 30, 2015, by and between AdCare Health Systems, Inc., and Cantone Asset Management, LLC and Cantone Research, Inc.
|
Incorporated by reference to Exhibit 10.105 of the Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2015
|
10.1
|
Master Lease Agreement, dated February 5, 2016, by and among Valley River Property Holdings, LLC, Homestead Property Holdings, LLC, Park Heritage Property Holdings, LLC, Mt. V Property Holdings, LLC, Mountain Top Property Holdings, LLC, Little Rock HC&R Property Holdings, LLC, Woodland Hills HC Property Holdings, LLC, Northridge HC&R Property Holdings, LLC, APH&R Property Holdings, LLC, and Skyline Healthcare, LLC
|
Incorporated by reference to Exhibit 10.462 of the Registrant's Annual Report on Form 10-K for the year ended December 31, 2015
|
10.2
|
Option Agreement, dated February 5, 2016, by and among Valley River Property Holdings, LLC, Homestead Property Holdings, LLC, Park Heritage Property Holdings, LLC, Mt. V Property Holdings, LLC, Mountain Top Property Holdings, LLC, Little Rock HC&R Property Holdings, LLC, Woodland Hills HC Property Holdings, LLC, Northridge HC&R Property Holdings, LLC, APH&R Property Holdings, LLC, and Joseph Schwartz
|
Incorporated by reference to Exhibit 10.463 of the Registrant's Annual Report on Form 10-K for the year ended December 31, 2015
|
10.3
|
Third Amendment to Lease, dated October 1, 2015, by and between William M. Foster and ADK Georgia, LLC
|
Filed herewith
|
10.4*
|
Letter Agreement, dated February 1, 2016, by and between E. Clinton Cain and AdCare Health Systems, Inc.
|
Filed herewith
|
31.1
|
Certification of CEO pursuant to Section 302 of the Sarbanes-Oxley Act
|
Filed herewith
|
31.2
|
Certification of CFO pursuant to Section 302 of the Sarbanes-Oxley Act
|
Filed herewith
|
32.1
|
Certification of CEO pursuant to Section 906 of the Sarbanes-Oxley Act
|
Filed herewith
|
32.2
|
Certification of CFO pursuant to Section 906 of the Sarbanes-Oxley Act
|
Filed herewith
|
101
|
The following financial information from AdCare Health Systems, Inc. Quarterly Report on Form 10-Q for the quarter ended March 31, 2016, formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Balance Sheets as of March 31, 2016 and December 31, 2015, (ii) Consolidated Statements of Operations for the three months ended March 31, 2016 and 2015, (iii) Consolidated Statements of Stockholders’ Deficit for the three months ended March 31, 2016 (iv) Consolidated Statements of Cash Flows for the three months ended March 31, 2016 and 2015, and (v) the Notes to Consolidated Financial Statements.
|
Filed herewith
|
|
|
|
ADCARE HEALTH SYSTEMS, INC.
|
|
|
|
(Registrant)
|
|
|
|
|
Date:
|
May 16, 2016
|
|
/s/ William McBride III
|
|
|
|
William McBride III
|
|
|
|
Chairman and Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
Date:
|
May 16, 2016
|
|
/s/ Allan J. Rimland
|
|
|
|
Allan J. Rimland
|
|
|
|
President, Chief Financial Officer and Corporate Secretary (Principal Financial Officer)
|
|
|
|
|
Date:
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May 16, 2016
|
|
/s/ E. Clinton Cain
|
|
|
|
E. Clinton Cain
|
|
|
|
Senior Vice President, Chief Accounting Officer and Controller (Principal Accounting Officer)
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|
|
SELLERS
:
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|
|
|
|
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VALLEY RIVER PROPERTY HOLDINGS,
|
|
|
|
LLC
, a Georgia limited liability company
|
|
|
|
|
|
|
|
By:
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/s/ William McBride
|
|
|
Name:
|
William McBride
|
|
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Title:
|
Manager
|
|
|
|
|
|
|
HOMESTEAD PROPERTY HOLDINGS, LLC
,
|
|
|
|
a Georgia limited liability company
|
|
|
|
|
|
|
|
By:
|
/s/ William McBride
|
|
|
Name:
|
William McBride
|
|
|
Title:
|
Manager
|
|
|
|
|
|
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PARK HERITAGE PROPERTY
|
|
|
|
HOLDINGS, LLC
, a Georgia limited liability
|
|
|
|
company
|
|
|
|
|
|
|
|
By:
|
/s/ William McBride
|
|
|
Name:
|
William McBride
|
|
|
Title:
|
Manager
|
|
|
|
|
|
|
MT. V PROPERTY HOLDINGS, LLC
, a Georgia
|
|
|
|
limited liability company
|
|
|
|
|
|
|
|
By:
|
/s/ William McBride
|
|
|
Name:
|
William McBride
|
|
|
Title:
|
Manager
|
|
|
|
|
|
|
MOUNTAIN TOP PROPERTY HOLDINGS,
|
|
|
|
LLC
, a Georgia limited liability company
|
|
|
|
|
|
|
|
By:
|
/s/ William McBride
|
|
|
Name:
|
William McBride
|
|
|
Title:
|
Manager
|
|
|
|
|
|
|
LITTLE ROCK HC&R PROPERTY
|
|
|
|
HOLDINGS, LLC
, a Georgia limited liability
|
|
|
|
company
|
|
|
|
|
|
|
|
By:
|
/s/ William McBride
|
|
|
Name:
|
William McBride
|
|
|
Title:
|
Manager
|
|
|
|
|
|
|
WOODLAND HILLS HC PROPERTY
|
|
|
|
HOLDINGS, LLC
, a Georgia limited liability
|
|
|
|
company
|
|
|
|
|
|
|
|
By:
|
/s/ William McBride
|
|
|
Name:
|
William McBride
|
|
|
Title:
|
Manager
|
|
|
|
|
|
|
NORTHRIDGE HC&R PROPERTY
|
|
|
|
HOLDINGS, LLC
, a Georgia limited liability
|
|
|
|
company
|
|
|
|
|
|
|
|
By:
|
/s/ William McBride
|
|
|
Name:
|
William McBride
|
|
|
Title:
|
Manager
|
|
|
|
|
|
|
APH&R PROPERTY HOLDINGS, LLC
,
|
|
|
|
a Georgia limited liability company
|
|
|
|
|
|
|
|
By:
|
/s/ William McBride
|
|
|
Name:
|
William McBride
|
|
|
Title:
|
Manager
|
|
|
|
|
|
|
PURCHASERS
:
|
|
|
|
|
|
|
|
LITTLE ARK REALTY HOLDINGS, LLC,
|
|
|
|
an Arkansas limited liability company
|
|
|
|
|
|
|
|
By:
|
/s/ Joseph Schwartz
|
|
|
Name:
|
Joseph Schwartz
|
|
|
Title:
|
Manager
|
|
|
|
|
Facility Name
|
Landlord
|
Tenant
|
Address
|
Bed Number
Facility Type
|
Homestead Manor Nursing Home
|
Homestead Property Holdings, LLC
|
__________
|
826 North Street
Stamps, AR 71860-4522
|
104 bed SNF
|
Heritage Park Nursing Center
|
Park Heritage Property Holdings, LLC
|
__________
|
1513 S. Dixieland Road
Rogers 72758-4935
|
110 bed SNF
|
Stone County Nursing and Rehabilitation Center
|
Mt. V Property Holdings, LLC
|
__________
|
706 Oak Grove Street
Mountain View, AR 72560-8601
|
97 bed SNF
|
Stone County Residential Care Facility
|
Mountain Top Property Holdings, LLC
|
__________
|
414 Massey Avenue
Mountain View, AR 72560-6132
|
32 bed ALF
|
West Markham Sub Acute and Rehabilitation Center
|
Little Rock HC&R Property Holdings, LLC
|
__________
|
5720 West Markham Street
Little Rock, AR 72205-3328
|
154 bed SNF
|
Woodland Hills Healthcare and Rehabilitation
|
Woodland Hills HC Property Holdings, LLC
|
__________
|
8701 Riley Dr.
Little Rock, AR 72205-6509
|
140 bed SNF
|
Northridge Healthcare and Rehabilitation
|
Northridge HC&R Property Holdings, LLC
|
__________
|
2501 John Ashley Dr.
North Little Rock, AR
72114-1815
|
140 bed SNF
|
Cumberland Health and Rehabilitation Center
|
APH&R Property Holdings, LLC
|
__________
|
1516 S. Cumberland Street
Little Rock, AR 72202-5065
|
120 bed SNF
|
River Valley Health and Rehabilitation Center
|
Valley River Property Holdings, LLC
|
__________
|
5301 Wheeler Avenue
Fort Smith, AR 72901-8339
|
129 bed SNF
|
LESSOR:
|
|
LESSEE:
|
|
|
|
|
|
|
|
|
ADK GEORGIA, LLC,
a Georgia limited liability
|
|||
|
|
company
|
||
|
|
|
|
|
/s/ William M. Foster
|
By:
|
/s/ William McBride
|
||
William M. Foster
|
|
William McBride, Manager
|
If to Owner:
|
William M. Foster
c/o Foster Development Company
146 Spring Street
Macon, Georgia 31201
|
With a copy to:
|
Joshua E. Kight, Esq.
306 Academy Ave., Suite 200
P.O. Box 816
Dublin, GA 31040
|
If to Sub-Landlord:
|
ADK Georgia, LLC
3050 Peachtree Road NW, Suite 355
Atlanta, Georgia 30305
Attn: Manager
|
With a copy to:
|
Gregory P. Youra, Esq.
Holt Ney Zatcoff & Wasserman, LLP 100 Galleria Parkway, Suite 1800
Atlanta, Georgia 30339
|
If to Lender:
|
Regions Bank
1900 5th Avenue North, 14th Floor Birmingham, AL 35203
Attn: Steven W. "Steve" Mitchell
|
With a copy to:
|
Baker, Donelson, Bearman, Caldwell & Berkowitz, PC
1600 Wells Fargo Tower
Birmingham, Alabama 35203
Attn: Luther P. Crull, III, Esq
|
Signed, sealed and delivered in the presence of:
Unofficial Witness
Notary Public
My Commission Expires:
|
LENDER:
By:
Name:
Its:
Date:
|
|
|
|
|
|
/s/ Allan J. Rimland 2/1/2016
|
|
/s/ E. Clinton Cain 2/1/2016
|
||
Allan J. Rimland, President, Date
|
|
Name, Date
|
||
|
|
|
|
|
|
|
|
|
|
Date:
|
May 16, 2016
|
|
/s/ William McBride III
|
|
|
|
William McBride III
|
|
|
|
Chief Executive Officer
|
Date:
|
May 16, 2016
|
|
/s/ Allan J. Rimland
|
|
|
|
Allan J. Rimland
|
|
|
|
President, Chief Financial Officer, and Corporate Secretary (Principal Financial Officer)
|
Date:
|
May 16, 2016
|
|
/s/ William McBride III
|
|
|
|
William McBride III
|
|
|
|
Chief Executive Officer
|
Date:
|
May 16, 2016
|
|
/s/ Allan J. Rimland
|
|
|
|
Allan J. Rimland
|
|
|
|
President, Chief Financial Officer, and Corporate Secretary
|