GLOBAL HEALTHCARE REIT, INC. (Form: 8-K, Received: 11/17/2017 06:04:14)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 8, 2017

GLOBAL HEALTHCARE REIT, INC.

(Exact Name of Registrant as Specified in its Charter)

Utah	0-15415	87-0340206
(State or other jurisdiction	Commission	(I.R.S. Employer
of incorporation)	File Number	Identification number)

8480 E. Orchard Road, Suite 4900, Greenwood Village, CO 80111

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (303) 449-2100

(Former name or former address, if changed since last report)

[ ]	Written communications pursuant to Rule 425 under the Securities Act
[ ]	Soliciting material pursuant to Rule 14a-12 under the Exchange Act
[ ]	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act
[ ]	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act

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

Emerging growth company [X]

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

ITEM 2.03 CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBGLIATION UNDER AN OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT

On November 8, 2017, the Company completed the sale of an aggregate of $300,000 of its 10% Senior Promissory Notes (“Notes”) for a purchase price equal to the principal amount of the Notes. For every $1.00 in principal amount of Note, each investor will receive one warrant (“Warrant”) exercisable for 12 months to purchase one share of common stock at an exercise price of $0.75 per share. The Notes are due and payable on October 31, 2020, (the “Maturity Date”). Each investor will be required to be bound by an Agreement Among Lenders pursuant to which the rights of investors under the Notes a will be governed by investors holding a Majority in Interest in the Notes. The form of Agreement Among Lenders is filed herewith as Exhibit 10.1 and the form of Note is filed herewith as Exhibit 99.1.

ITEM 3.02 UNREGISTERED SALE OF EQUITY SECURITIES

ITEM 7.01 REGULATION FD DISCLOSURE

The following sets forth the information required by Item 701 of Regulation S-K with respect to the unregistered sales of equity securities by Global Healthcare REIT, Inc., a Utah corporation (the “Company”), effective November 8, 2017:

	a.	On November 8, 2017, Global Healthcare REIT, Inc. (the “Company”), completed the sale of an aggregate of $300,000 of its Units, each Unit consisting of a 10% Senior Promissory Note (“Note”) and one Warrant for every $1.00 in principal amount of Note. The purchase price for the Units is equal to the principal amount of the Notes as reflected in Item 2.03 above. Each Warrant is exercisable for 12 months to purchase a share of common stock at an exercise price of $.75 per share.

	b.	The Notes and Warrants were sold to four investors, each of whom qualified as an “accredited investor” within the meaning of Rule 501(a) of Regulation D under the Securities Act of 1933 as amended (the “Securities Act”).

	c.	The Company paid no fees or commissions in connection with the issuance of the Units.

	d.	The issuance of the Securities was undertaken without registration under the Securities Act in reliance upon an exemption from the registration requirements of the Securities Act set forth in Sections 4(2) thereunder. The investors each qualified as an “accredited investor” within the meaning of Rule 501(a) of Regulation D. In addition, the Securities, which were taken for investment purposes and not for resale, were subject to restrictions on transfer. We did not engage in any public advertising or general solicitation in connection with this transaction, and we provided the investor with disclosure of all aspects of our business, including providing the investor with our reports filed with the Securities and Exchange Commission and other financial, business and corporate information. Based on our investigation, we believed that the accredited investors obtained all information regarding the Company that each requested, received answers to all questions posed and otherwise understood the risks of accepting our Securities for investment purposes.

	e.	Not applicable.

	f.	The proceeds will be used for general working capital.

ITEM 9.01: FINANCIAL STATEMENTS AND EXHIBITS

	Item		Title

	10.1		Form of Agreement Among Lenders
	99.1		Form of Promissory Note

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		Global Healthcare REIT, Inc. (Registrant)

Dated:	November 16, 2017	/s/ Zvi Rhine
		Zvi Rhine, President

AGREEMENT BY AND AMONG LENDERS

This Agreement is made and entered into as of the __ day of ___________, 2017, by and between Global Healthcare REIT, Inc., a Utah corporation and its wholly-owned subsidiary High Street Nursing, LLC, a Georgia limited liability company (collectively the “Company”) and those parties who purchased and hold Series 2017 10% Subordinated Secured Promissory Notes (the “Notes”) issued by the Company (collectively referred to herein as “Lenders”).

RECITALS

A. The Company has sold Notes to Lenders in the aggregate principal amount of up to Three Hundred Thousand and 00/100 Dollars ($300,000).

B. Lenders desire to act in concert with respect to the Notes.

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, the receipt and sufficiency whereof are hereby acknowledged, the parties agree as follows:

1. Risks of Collectibility . Each Lender will bear the risks of collectibility of the Note held by it, of the Borrower’s financial condition, of fraud or forgery, of the adequacy of the security for Loan, and any other matters relating to the Loan. Each Lender agrees that it has been solely responsible for making an independent appraisal and investigation into the financial condition, creditworthiness, nature, and status of the Borrower. Each Lender confirms to the other Lenders that it has not, in connection with his decision to enter into the Loan transaction, relied on any other Lender (i) to inquire on his behalf into the accuracy or completeness of any information provided in connection with the Loan (whether or not such information is distributed to the Lenders), (ii) to assess or keep under review on his behalf the financial condition, creditworthiness, nature or status of the Borrower, or (iii) to advise such Lender as to the results of any appraisal or investigation performed by any other Lender.

2. Appointment of Agent . (a) Upon the occurrence of one or more of the events of Default set forth in the Lender Notes, or in the event a Majority of the Lenders so determine, Lenders shall appoint an agent (“Agent”) to perform certain ministerial functions on their behalf, including those specified in the Lender Notes. Lenders holding a majority of the total outstanding principal balance of the Notes (“Majority” or “Majority in Interest”) shall control all decisions regarding the exercise of rights of the Lenders under the Lender Notes. Lenders constituting a Majority shall appoint the Agent in the manner set forth in paragraph 4(c).

(b) Agent will enforce the Lender Notes, as described in the other provisions of this Agreement.

(c) The Agent shall be appointed by vote of a Majority. The vote may be taken (i) in a meeting held for such purpose upon five (5) days written notice to the Lenders; or (ii) by written agreement of a Majority without a meeting. Attendance at the meeting may be in person, by proxy, or by telephone. Agent will signify his acceptance of such appointment, and his agreement with terms of this agreement that pertain to him as Agent, by executing a copy of this Agreement. The terms of this agreement pertaining to such Agent’s rights, duties, and responsibilities hereunder shall be effective upon the Agent’s signature.

3. Expenses . If an Agent is appointed under paragraph 4 of this Agreement, Lenders shall pay him/her/it for their services in an amount that is customary and reasonable for such services. The following out-of-pocket expenses incurred by Agent, to the extent not paid by the Company, shall be paid by the Lenders pro rata in proportion to the amount of the Lender Notes held by them:

(a) Expenses incurred in the enforcement of the Lender Notes;

(b) Expenses incurred following any Event of Default under any of the Lender Notes and any expenses incurred prior to but in connection with or in preparation for any such Event of Default; and

Each Lender shall pay its share of all such expenses within fifteen (15) calendar days after receipt of a written statement from Agent itemizing the expenses that have been incurred and are due and payable or have been paid by Agent. In the event that any Lender fails or refuses to pay its share of any expenses under this Section, Agent shall have a priority claim, to the extent of such unpaid expenses, on such Lender’s share of all payments of principal, interest, fees, and other charges with respect to the Notes and of all proceeds from realization upon the Notes. Each Lender hereby grants to Agent a security interest in its share of such payments and proceeds to secure the payment of expenses that it is obligated to pay hereunder.

4. Records . Agent shall at all times keep books of account and records at his current address reflecting all transactions in connection with the Loan and the Lenders’ interests therein. Each Lender shall have access to Agent’s records maintained in connection with the Loan for inspection and/or copying at such Lender’s expense at all reasonable times during business hours. Upon request, Agent shall furnish to any Lender copies of title reports, financial information, inspection reports, and other documents relating to the Loan, or the Company that have been furnished to or prepared by Agent in connection with the Loan.

5. Liability of Agent . Neither Agent nor any of his/her/its agents shall be liable for any action taken or not taken in good faith in connection with the Loan, in the absence of his own gross negligence or willful misconduct. Agent shall in no event be liable to any Lender for any action taken or not taken by Agent with the consent or at the request of such Lender, unless such action is performed in a grossly negligent manner or in a manner constituting willful misconduct (which manner of performance was not requested or consented to by such Lender).

Agent may consult with legal counsel, independent public accountants and other experts selected by him and shall not be liable for any action taken or not taken in good faith reliance upon the advice of such experts. Unless specifically requested to do so by any Lender, Agent shall have no duty to inquire into or verify (i) any statement, warranty, or representation made by the Company in connection with the Loan; (ii) the truthfulness or genuineness of any information or document supplied by the Company in connection with the Loan; or (iii) the genuineness of the signatures of any party (other than Agent). Agent shall not incur any liability by acting in reliance upon any notice, consent, or other writing (including telexes, telecopies, or similar instruments) believed by Agent to be genuine or to be signed by the proper party or parties.

6. Indemnification . Each Lender shall, pro rata, in proportion to the amount of the Note held by him, indemnify Agent against any cost, expense, claim, demand, action, loss, or liability, including reasonable attorney’s fees incurred in contesting the same, that Agent may suffer or incur in connection with the Loan in his capacity as Agent, or any action taken or omitted by Agent in good faith under this Agreement, except to the extent the same arises from Agent’s gross negligence or willful misconduct, or from actions taken by Agent that are outside the scope of his authority under this Agreement.

7. Litigation . Subject to the provisions of Section 12 hereof, Agent shall have the exclusive right to initiate, direct, and otherwise control any litigation involving all of the Lenders in their capacity as such under the Loan, whether as plaintiffs, defendants, or otherwise. All costs and expenses incurred by Agent in connection with such litigation, including reasonable attorney’s fees, shall be paid in accordance with Section 4 hereof.

8. Notifications . Each Lender shall endeavor (but shall not incur any liability for failure to do so) to notify each other of any events or occurrences that come to their attention that may have material adverse effect on the security for the Loan or the ability of the Company to perform any of their respective obligations under the Lender Notes.

9. Defaults of the Company . Agent shall send to each Lender a copy of each notice he sends to the Company pursuant to the Lender Notes notifying the Company of any claimed defaults thereunder. The failure of the Company to cure any such default within the time periods, if any, specified in the Lender Notes shall constitute an Event of Default thereunder unless such Event of Default is waived (either during or after the applicable cure period) by all of the Lenders (for any Event of Default resulting from the failure to make required payments of principal and interest on the Loan) or by a Majority (for any other Event of Default).

Agent shall advise the Lenders from time to time as to his recommendations with respect to any Event of Default and the possible waiver thereof.

10. Enforcement . Upon the occurrence of any Event of Default under the Lender Notes that is not waived in accordance with the terms of this Agreement, Agent shall (unless otherwise required by this Section 11) take all reasonable steps for the enforcement of the Loan that Agent would normally take in the event of such a default that is not waived under a similar loan for his own account. Agent shall be entitled to exercise his reasonable discretion to determine when and in what manner the Loan shall be enforced, and shall control and direct all actions taken or not taken in connection with such enforcement; provided, however, that a majority in interest of the Lenders must approve, or may require, the exercise of any affirmative remedy provided to Agent under the terms of any of the Lender Notes, including but not limited to, acceleration of the Lender Notes. Unless otherwise instructed in writing by a majority in interest of the Lenders, however, Agent shall have no obligation to withhold disbursements or exercise any right or remedy available to Lenders if in Agent’s reasonable judgment the exercise of such rights is not in the best interests of the Lenders.

11. Permitted Actions . Any actions that require the consent or approval of a specified number of Lenders pursuant to the terms of this Agreement may be initiated by any group of Lenders comprising the number whose consent or approval is required. Any actions, consents, or approvals required or permitted of the Lenders under the Lender Notes, for which the consent or approval of a specified number of Lenders is not required in this Agreement, may be taken or given by Agent, and if so taken or given by Agent shall not be binding upon all of the Lenders. Agent may, however, at his sole option at any time upon notice to the Lenders, request the Lenders’ approval or authorization of any action, consent, or approval that may be taken or given by Agent under the preceding sentence, which approval or authorization shall require the written consent of a majority in interest of the Lenders.

Any action taken or decision made by Agent or by any group of Lenders to whom the authority to take such action or make such decision has been given pursuant to the terms of this Agreement, shall be binding upon all of the Lenders, and each Lender agrees to execute all documents and instruments and take all other actions that are deemed necessary or desirable by Agent or the Lenders making such decisions to carry out the terms thereof.

12. Pari Passu Status in Lender Notes.

a. Each of the Lenders hereby acknowledges and agrees that none of the Lenders, individually or collectively, shall have priority with respect to any payments of principal or interest in respect of the Lenders’ Lender Notes. Rather, each of the Lenders hereby acknowledges and agrees that its and their respective rights and priority are pari passu with the rights and priority of each and all of the Lenders. In addition, and without limitation of the generality of the foregoing, each Lender hereby confirms, agrees and stipulates that regardless of the relative times at which indebtedness of the Company was incurred to the holders of Lender Notes, and regardless of anything to the contrary contained in any documents executed in connection with the Lender Notes, shall in all respects be held by them on a pari passu basis.

b. In the event of (i) an Event of Default, (ii) any insolvency, bankruptcy, receivership, liquidation, reorganization, assignment for the benefit of creditors or other similar proceeding relating to the Company, whether voluntary or involuntary, (iii) any proceeding for the voluntary liquidation, dissolution or other winding-up of the Company, whether involving insolvency or bankruptcy proceedings or not, then, and in any such event, any payment or other distribution of any character, whether in cash, securities or other property out of or in respect of the assets of the Company, shall be shared by the Lenders on a pari passu basis with the amount thereto to which Lenders are entitled to be determined based on the proportion which the then outstanding Lenders’ indebtedness bears to the aggregate indebtedness represented by the Lender Notes; provided, however, that the Lenders, individually or collectively, shall not take any action without prior written notice having been furnished to all Lenders.

c. If the Lenders, individually or collectively, shall at any time have received any payment, distribution or additional security from any of the assets of the Company, whether arising out of or as a result of any event described in Section 13(b) above or otherwise, the receiving party thereof shall promptly provide the Company or any court-appointed trustee or Agent with a detailed accounting thereof, and shall promptly take all action necessary to implement the pro-rata sharing contemplated by Section 13(b) above. Any such payment, distribution or security so received shall be deemed to be held in trust by the receiving party thereof for the benefit of all the Lenders until such sharing has been implemented and completed as contemplated by Section 13(b) above.

d. Each of the Lenders agree to use reasonable efforts to cooperate with one another in the realization upon and/or liquidation of the assets of Company following an Event of Default, and to promptly advise any designated or appointed agent with respect to the Company’s assets and all other Lenders of any actions taken with respect thereto, provided, however, that no Lender shall, enter into any modification or amendment of any agreements that would (i) extend the term of the Lenders’ Indebtedness, (ii) increase the applicable rate of interest payable by the Company thereunder, or (iii) increase the amount of the Company’s indebtedness thereunder, without the prior written approval of a two-thirds (2/3rds) majority in interest of all of the Lenders.

14. Power of Attorney .

a. To effectuate the terms and provisions hereof, the Lenders hereby appoint the Agent as their attorney-in-fact (and the Agent hereby accepts such appointment) for the purpose of carrying out the provisions of this Agreement including, without limitation, taking any action on behalf of, or at the instruction of, the Majority in Interest at the written direction of the Majority in Interest and executing any consent authorized pursuant to this Agreement and taking any action and executing any instrument that the Agent may deem necessary or advisable (and lawful) to accomplish the purposes hereof.

b. All acts done under the foregoing authorization are hereby ratified and approved and neither the Agent nor any designee nor agent thereof shall be liable for any acts of commission or omission, for any error of judgment, for any mistake of fact or law except for acts of gross negligence or willful misconduct.

c. This power of attorney, being coupled with an interest, is irrevocable while this Agreement remains in effect.

15. Further Assurances . Each Lender, and Agent after his appointment, agree to use their best efforts to cooperate in the administration of the Loan under this Agreement and, except as specified in Section 9 hereof, to use their best efforts to keep each other reasonably well informed with respect to any material event relating to the Company and/or the Loan. Without limiting the generality of the foregoing, the parties hereby agree to execute such documents and perform such acts as may be desirable to carry out the purposes of this Agreement, including without limitation, the execution of such documents as Agent may request in connection with any actions or decisions of Agent or any specified number of Lenders authorized under this Agreement regarding the administration or enforcement of the Loan, ownership, management, operation, sale, or leasing of the collateral, whether or not any Lender agrees with such decision or action. The obligations of the parties contained herein may be specifically enforced by an action brought in a court of competent jurisdiction.

16. Successors and Assigns; Resignation of Agent . Any Lender shall have the right to assign its interest in this Agreement to any one to whom it has assigned its Note. Agent’s obligations hereunder shall not be assigned or delegated without the prior written consent of a Majority. Agent may resign as agent at any time for any reason upon providing the Lenders 10 days prior written notice. Upon the resignation of Agent, a Majority shall designate a successor agent in accordance with the provisions of paragraph 4(c).

17. No Joint Venture . Nothing contained in this Agreement shall be construed as creating a joint venture or partnership among the parties hereto, and no party shall be obligated for the acts or omissions of any other party except as expressly provided herein.

18. Notices . Except where verbal notice is specifically authorized in this Agreement, all notices hereunder shall be in writing and shall be deemed effectively given or served for all purposes when presented personally, upon receipt if sent by first class mail or over-night express, or on the date of transmission if sent by telegram, telex, or telecopy to any party hereto at the address set forth on the signature page hereof, or at such other address as any party shall subsequently designate by notice.

19. Approvals . Any document, information, or action that is required to be approved by any party under this Agreement shall be approved or disapproved by written notice given no later than fifteen (15) calendar days after receipt of such document, information, or written request for approval of such action. If any party fails to give its written approval or disapproval of any matter within the foregoing fifteen-day period, such party will be deemed to have approved such matter for all purposes.

20. No Oral Change . This Agreement may not be changed, discharged, or terminated orally, but only by an instrument in writing signed by the party against whom enforcement of the change, discharge, or termination is sought.

21. Arbitration . If at any time during the term of this Agreement any dispute, difference, or disagreement shall arise upon or in respect of the Agreement, and the meaning and construction hereof, every such dispute, difference, and disagreement shall be referred to a single arbiter agreed upon by the parties, or if no single arbiter can be agreed upon, an arbiter or arbiters shall be selected in accordance with the rules of the American Arbitration Association and such dispute, difference, or disagreement shall be settled by arbitration in accordance with the then prevailing commercial rules of the American Arbitration Association, and judgment upon the award rendered by the arbiter may be entered in any court having jurisdiction thereof.

22. Litigation Costs . In the event of any controversy, claim, arbitration, or legal action among the parties hereto arising out of this Agreement or relating to the Loan, the prevailing party will be entitled to recover from the other party or parties (jointly or severally) all costs, damages, and expenses, including reasonable attorney’s fees, incurred by the prevailing party in connection with such controversy, claim, arbitration, or legal action.

23. Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of Colorado, excluding its laws of conflict of laws.

24. Severability . The provisions of this Agreement are severable and a declaration by a court of competent jurisdiction that any of those provisions is invalid or unenforceable shall not affect the validity or enforceability of any other provision.

25. Headings . The headings used herein are for purposes of convenience only and should not be used in construing the provisions hereof.

26. Counterparts. This agreement may be executed in any number of counterparts, each of which shall be deemed to be an original and all of which together shall be deemed the same document.

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly authorized agents as of the day and year first above written.

GLOBAL HEALTHCARE REIT, INC.

By:
	Zvi Rhine, President

LENDER:

Name:

Address:

Amount of Note:

Signature:	By execution of Subscription Agreement

THIS NOTE HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.

No. [2017-____]

U.S. $ _____,000

Original Issue Date: ______________________

SERIES 2017 10% SENIOR PROMISSORY NOTE

DUE OCTOBER 31, 2020

THIS NOTE is one of a duly authorized series of Notes of GLOBAL HEALTHCARE REIT, INC. , a Utah corporation (collectively the “ Company ” or “Maker”), designated as its Series 2017 10% Senior Promissory Notes (the “Notes”) due on October 31, 2020 (the “Maturity Date”), in an aggregate principal amount of up to $300,000 plus accrued and unpaid interest.

FOR VALUE RECEIVED, the Maker promises to pay to _______ , the registered holder hereof (the “Holder”), the principal sum of __________ Thousand and 00/100 Dollars (US $____,000.00) and to pay interest on the principal sum outstanding from time to time at the rate of 10% per annum, calculated from the date of initial issuance of this Note (the “Issue Date”) and payable monthly in cash in arrears on each Interest Payment Date as defined in Section 4.

The Company shall pay all accrued and unpaid interest, in arrears, on each Interest Payment Date, as provided herein, and shall pay the outstanding principal balance hereof on the Maturity Date.

This Note is being issued pursuant to the terms of the Subscription Agreement (the “Subscription Agreement”), to which the Company and the Holder (or the Holder’s predecessor in interest) are parties. Capitalized terms not otherwise defined herein shall have the meanings ascribed to them in the Subscription Agreement.

This Note is subject to the following additional provisions.

Section 1. Pari Passu.

(a) This Note is one of a series of senior notes known as the Series 2017 10% Senior Promissory Notes in the aggregate principal amount of up to $300,000 plus accrued but unpaid interest. No payments will be made to the holder of this Note unless a proportional payment (based on outstanding principal amount) is made with respect to all other Notes. Upon liquidation, this Note will be treated in pari passu with all other Notes issued in this Series.

(b) The Company’s obligations under this Note are subordinated to the Company’s 2016 10% Senior Secured Notes in the aggregate principal amount of up to $1.75 million. The exercise of rights under this Note shall be governed by an Agreement Among Lenders. Upon liquidation, this Note will be treated in pari passu with all other Notes issued in this Series.

Section 2 . No Sale or Transfer. This Note may not be sold, transferred, assigned, hypothecated or divided into two or more Notes of smaller denominations except to the extent such sale, transfer, assignment, hypothecation or division is in compliance with federal and applicable state securities laws, the compliance with which must be established to the reasonable satisfaction of the Company.

Section 3 . No Limitations on Debt . The existence of this Note does not preclude the Company from incurring other indebtedness.

Section 4. Provisions Regarding Payment of Interest. Interest hereunder will be paid to the Holder, calculated from the date of initial issuance of this Note (the “Issue Date”) and payable monthly in cash calculated at the rate of 10% per annum and payable 1/12 each month on or before the fifteenth day of each month for interest accrued for the preceding month until paid in full (each an “Interest Payment Date”). If not paid previously, all interest will be payable at the Maturity Date.

Section 5. (a) “ Event of Default ” wherever used herein, means any one of the following events (whatever the reason and whether it shall be voluntary or involuntary or effected by operation of law or pursuant to any judgment, decree or order of any court, or any order, rule or regulation of any administrative or governmental body):

(i) Any default in the payment of the principal of or interest on this Note as and when the same shall become due and payable after thirty (30) days’ written notice of default, (whether on the Maturity Date or by acceleration or otherwise);

(ii) The Company shall fail to observe or perform any other covenant, agreement or warranty contained in, or otherwise commit any breach of, this Note or the Security Agreement and such failure or breach shall not have been remedied within 30 days after the date on which notice of such failure or breach shall have been given;

(iii) The Company shall commence a voluntary case under the United States Bankruptcy Code or insolvency laws as now or hereafter in effect or any successor thereto (the “ Bankruptcy Code ”); or an involuntary case is commenced against the Company under the Bankruptcy Code and the petition is not controverted within 30 days, or is not dismissed within 60 days, after commencement of such involuntary case; or a “custodian” (as defined in the Bankruptcy Code) is appointed for, or takes charge of, all or any substantial part of the property of the Company or the Company commences any other proceeding under any reorganization, arrangement, adjustment of debt, relief of debtors, dissolution, insolvency or liquidation or similar law of any jurisdiction whether now or hereafter in effect relating to the Company or there is commenced against the Company any such proceeding which remains undismissed for a period of 60 days; or the Company is adjudicated insolvent or bankrupt; or any order of relief or other order approving any such case or proceeding is entered; or the Company suffers any appointment of any custodian or the like for it or any substantial part of its property which continues undischarged or unstayed for a period of 60 days; or the Company makes a general assignment for the benefit of creditors; or the Company shall fail to pay, or shall state that it is unable to pay its debts generally as they become due; or the Company shall call a meeting of all of its creditors with a view to arranging a composition or adjustment of its debts; or the Company shall by any act or failure to act indicate its consent to, approval of or acquiescence in any of the foregoing; or any corporate or other action is taken by the Company for the purpose of effecting any of the foregoing.

(b) Remedies . A Majority in Interest of the Holders of all the Notes issued in this Series may declare a default under Section 5(a)(i) upon not less than 30 days’ written notice to the Company. If the Company fails to cure an Event of Default within such period (or if the cure cannot be reasonably completed within such period, commence the cure of the Event of Default and diligently pursue such cure), then the principal amount hereof together with all accrued and unpaid interest up to the date of default shall thereafter accrue interest at the default interest rate of 12% per annum and the Holders may:

(i) Declare all amounts due under the Notes immediately due and owing and exercise all rights with respect thereto permitted by law;

(ii) Apply to a court that has jurisdiction over the Company for the appointment of a receiver to manage the assets and operations of the Company;

(iii) Assert any other remedy available at law or in equity.

Section 6. No Prepayment Penalty. This Note may be prepaid, in whole or in part, at any time without penalty or premium.

Section 7. Definitions. For the purposes hereof, the following terms shall have the following meanings:

“ Business Day ” means any day except Saturday, Sunday and any day which shall be a legal holiday or a day on which banking institutions in the State of Colorado are authorized or required by law or other government action to close.

“ Company ” means GLOBAL HEALTHCARE REIT, INC., a Utah corporation and its subsidiary HIGH STREET NURSING, LLC, a Georgia limited liability company.

“ Notes ” means the Notes, or any of them, as the context may require.

“ Holder ” means any Person who is a registered holder of this Note as listed in the books of the Company.

“ Interest Payment Date ” The Notes accrue interest at the rate of 10% per annum, payable monthly in cash on or before the fifteenth day of each month for interest accrued for the preceding month, until the Note is paid in full.

“ Material Adverse Effect ” means a material adverse effect upon the business, operations, properties, assets or condition (financial or otherwise) of the Company taken as a whole.

“ Maturity Date ” means the date defined in the first paragraph or (if earlier) the date of any prepayment or acceleration.

“ Original Issue Date ” shall mean the date this Note is purchased by the initial holder.

“ Person ” means a corporation, an association, a partnership, organization, a business, an individual, a government or political subdivision thereof or a governmental agency.

Section 8. Intentionally Omitted

Section 9. No Impairment. Except as expressly provided herein, no provision of this Note shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of, and interest on, this Note at the time, place, and rate, and in the coin or currency, herein prescribed. This Note is a direct obligation of the Company.

Section 10. No Rights as a Shareholder. This Note shall not entitle the Holder to any of the rights of a Shareholder of the Company, including without limitation, the right to vote, to receive dividends and other distributions, or to receive any notice of, or to attend, meetings of Shareholders or any other proceedings.

Section 11. No recourse shall be had for the payment of the principal of, or the interest on, this Note, or for any claim based hereon, or otherwise in respect hereof, against any incorporator, member, shareholder, manager, officer or director, as such, past, present or future, of the Company or any successor entity, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issue hereof, expressly waived and released.

Section 12. All payments contemplated hereby to be made “in cash” shall be made in immediately available good funds of United States of America currency by wire transfer to an account designated in writing by the Holder to the Company (which account may be changed by notice similarly given). All payments of cash and each delivery of shares of Common Stock issuable to the Holder as contemplated hereby shall be made to the Holder at the address last appearing on the Note Register of the Company as designated in writing by the Holder from time to time; except that the Holder can designate, by notice to the Company, a different delivery address for any one or more specific payments or deliveries.

Section 13. The Holder of the Note, by acceptance hereof, agrees that this Note is being acquired for investment and that such Holder will not offer, sell or otherwise dispose of this Note except under circumstances which will not result in a violation of the Act or any applicable state Blue Sky or foreign laws or similar laws relating to the sale of securities.

Section 14. The Notes will initially be issued in denominations determined by the Company, but are exchangeable for an equal aggregate principal amount of Notes of different denominations, as requested by the Holder surrendering the same. No service charge will be made for such registration or transfer or exchange.

Section 15. The Company shall be entitled to withhold from all payments of principal of, and interest on, this Note any amounts required to be withheld under the applicable provisions of the United States income tax laws or other applicable laws at the time of such payments, and Holder shall execute and deliver all required documentation in connection therewith.

Section 16 This Note has been issued subject to investment representations of the original purchaser hereof and may be transferred or exchanged only in compliance with the Securities Act of 1933, as amended (the “Act”), and other applicable state and foreign securities laws and the terms of the Subscription Agreement. In the event of any proposed transfer of this Note, the Company may require, prior to issuance of a new Note in the name of such other person, that it receive reasonable transfer documentation that is sufficient to evidence that such proposed transfer complies with the Act and other applicable state and foreign securities laws and the terms of the Subscription Agreement. Prior to due presentment for transfer of this Note, the Company and any agent of the Company may treat the person in whose name this Note is duly registered on the Company’s Note Register as the owner hereof for the purpose of receiving payment as herein provided and for all other purposes, whether or not this Note be overdue, and neither the Company nor any such agent shall be affected by notice to the contrary.

Section 17. Mutilated, Lost or Stolen Notes. If this Note shall be mutilated, lost, stolen or destroyed, the Company shall execute and deliver, in exchange and substitution for and upon cancellation of a mutilated Note, or in lieu of or in substitution for a lost, stolen or destroyed Note, a new Note for the principal amount of this Note so mutilated, lost, stolen or destroyed but only upon receipt of evidence of such loss, theft or destruction of such Note, and of the ownership hereof, and adequate indemnity, if requested, all reasonably satisfactory to the Company.

Section 18. Governing Law. This Note shall be governed by and construed in accordance with the laws of the State of Colorado. Each of the parties consents to the exclusive jurisdiction of the federal courts whose districts encompass any part of Denver, Colorado, or the state courts of the State of Colorado in connection with any dispute arising under this Agreement and hereby waives, to the maximum extent permitted by law, any objection, including any objection based on forum non coveniens , to the bringing of any such proceeding in such jurisdictions. To the extent determined by such court, the Company shall reimburse the Holder for any reasonable legal fees and disbursements incurred by the Holder in enforcement of or protection of any of its rights under any of this Note.

Section 19. Waiver of Jury Trial; No Other Waivers. The Company and the Holder hereby waive the right to a trial by jury in any action, proceeding or counterclaim in respect of any matter arising out or in connection with this Note. Any waiver by the Company or the Holder of a breach of any provision of this Note shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Note. The failure of the Company or the Holder to insist upon strict adherence to any term of this Note on one or more occasions shall not be considered a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this Note. Any waiver must be in writing.

Section 20. Severability. If any provision of this Note is invalid, illegal or unenforceable, the balance of this Note shall remain in effect, and if any provision is inapplicable to any Person or circumstance, it shall nevertheless remain applicable to all other Persons and circumstances.

Section 21. Obligations Due on a Business Day. Whenever any payment or other obligation hereunder shall be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day (or, if such next succeeding Business Day falls in the next calendar month, the preceding Business Day in the appropriate calendar month).

IN WITNESS WHEREOF , the Company has caused this instrument to be duly executed by an officer duly authorized for such purpose, as of the date first above indicated.

	GLOBAL HEALTHCARE REIT, INC.

	By:
	Name:	Zvi Rhine
	Title:	President

Accepted this _____ day of _______ 2017 by the undersigned, thereunto duly authorized, in accordance with the terms stated herein and the Subscription Agreement pursuant to which the undersigned acquired this Note.

Name of Holder: ___________________

By: ______________________________

Tax Identification Number: SS. __________________