Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2023 | Aug. 15, 2023 | |
Document Information [Line Items] | ||
Entity Registrant Name | REGIONAL HEALTH PROPERTIES, INC. | |
Entity Central Index Key | 0001004724 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2023 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 1,883,028 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Entity Current Reporting Status | Yes | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity File Number | 001-33135 | |
Entity Tax Identification Number | 81-5166048 | |
Entity Address, Address Line One | 1050 Crown Pointe Parkway | |
Entity Address, Address Line Two | Suite 720 | |
Entity Address, City or Town | Atlanta | |
Entity Address, State or Province | GA | |
Entity Address, Postal Zip Code | 30338 | |
City Area Code | 678 | |
Local Phone Number | 869-5116 | |
Entity Incorporation, State or Country Code | GA | |
Entity Interactive Data Current | Yes | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Common Stock | ||
Document Information [Line Items] | ||
Trading Symbol | RHE | |
Security Exchange Name | NYSEAMER | |
Title of 12(b) Security | Common Stock, no par value | |
Series A Preferred Stock | ||
Document Information [Line Items] | ||
Trading Symbol | RHE-PA | |
Security Exchange Name | NYSEAMER | |
Title of 12(b) Security | Series A Redeemable Preferred Stock, no par value |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
ASSETS | ||
Property and equipment, net | $ 46,266 | $ 46,611 |
Cash | 1,926 | 843 |
Restricted cash | 2,939 | 3,066 |
Accounts receivable, net of allowances of $1,400 and $1,298 | 3,023 | 6,289 |
Prepaid expenses and other | 1,237 | 746 |
Notes receivable | 772 | 1,099 |
Intangible assets - bed licenses | 2,471 | 2,471 |
Intangible assets - lease rights, net | 98 | 110 |
Right-of-use operating lease assets | 2,677 | 2,848 |
Goodwill | 1,585 | 1,585 |
Straight-line rent receivable | 2,860 | 2,912 |
Total assets | 65,854 | 68,580 |
LIABILITIES AND EQUITY | ||
Senior debt, net | 44,554 | 45,163 |
Bonds, net | 5,988 | 6,120 |
Other debt, net | 1,490 | 895 |
Accounts payable | 3,036 | 3,293 |
Accrued expenses | 4,832 | 5,036 |
Operating lease obligation | 3,044 | 3,226 |
Other liabilities | 1,635 | 1,131 |
Total liabilities | 64,579 | 64,864 |
Stockholders’ equity: | ||
Common stock and additional paid-in capital, no par value; 55,000 shares authorized; 1,894 and 1,793 shares issued and 1,883 and 1,784 shares outstanding at June 30, 2023 and December 31, 2022, respectively | 62,938 | 62,702 |
Preferred stock, no par value; 5,000 shares authorized (including amounts authorized for Series A and Series B); shares issued and outstanding designated as follows: | ||
Accumulated deficit | (80,691) | (121,409) |
Total stockholders’ equity | 1,275 | 3,716 |
Total liabilities and stockholders’ equity | 65,854 | 68,580 |
Series A Preferred Stock | ||
Preferred stock, no par value; 5,000 shares authorized (including amounts authorized for Series A and Series B); shares issued and outstanding designated as follows: | ||
Preferred stock | 426 | $ 62,423 |
Series B Preferred Stock | ||
Preferred stock, no par value; 5,000 shares authorized (including amounts authorized for Series A and Series B); shares issued and outstanding designated as follows: | ||
Preferred stock | $ 18,602 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Accounts receivable, allowances | $ 1,400 | $ 1,298 |
Common stock and additional paid-in capital, par value | $ 0 | $ 0 |
Common stock and additional paid-in capital, shares authorized | 55,000,000 | 55,000,000 |
Common stock and additional paid-in capital, shares issued | 1,894,000 | 1,793,000 |
Common stock and additional paid-in capital, shares outstanding | 1,883,028 | 1,784,000 |
Series A Preferred Stock | ||
Preferred stock, par value | $ 0 | $ 0 |
Preferred stock, shares authorized | 560,000 | 5,000,000 |
Preferred stock, shares issued | 560,000 | 2,812,000 |
Preferred stock, shares outstanding | 560,000 | 2,812,000 |
Preferred stock, redemption amount | $ 426 | $ 70,288 |
Series B Preferred Stock | ||
Preferred stock, par value | $ 0 | $ 0 |
Preferred stock, shares authorized | 2,812,000 | 0 |
Preferred stock, shares issued | 2,252,272 | 0 |
Preferred stock, shares outstanding | 2,252,272 | 0 |
Preferred stock, redemption amount | $ 18,602 | |
Series A and B Preferred Stock | ||
Preferred stock, par value | $ 0 | $ 0 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Revenues: | ||||
Patient care, management fees and other revenues | $ 4,598 | $ 8,093 | $ 8,504 | $ 14,740 |
Total revenues | 4,598 | 8,093 | 8,504 | 14,740 |
Expenses: | ||||
Patient care expense | 2,159 | 4,222 | 4,697 | 6,564 |
Facility rent expense | 149 | 1,634 | 297 | 3,274 |
Cost of management fees | 146 | 144 | 286 | 319 |
Depreciation and amortization | 702 | 606 | 1,212 | 1,219 |
General and administrative expense | 1,011 | 921 | 2,217 | 2,054 |
Doubtful accounts expense | 24 | 466 | 40 | 2,227 |
Other operating expenses | 221 | 629 | 313 | 968 |
Total expenses | 4,412 | 8,622 | 9,062 | 16,625 |
Income/(Loss) from operations | 186 | (529) | (558) | (1,885) |
Other expense: | ||||
Interest expense, net | 679 | 639 | 1,359 | 1,291 |
Other expense, net | 192 | 157 | 759 | 1,076 |
Total other expense, net | 871 | 796 | 2,118 | 2,367 |
Net Loss | (685) | (1,325) | (2,676) | (4,252) |
Preferred stock dividends - undeclared | (2,249) | (4,498) | ||
Preferred stock dividends - gain on extinguishment | 43,395 | 43,395 | ||
Net profit (loss) attributable to Regional Health Properties, Inc. common stockholders | $ 42,710 | $ (3,574) | $ 40,719 | $ (8,750) |
Net profit (loss) per share of common stock attributable to Regional Health Properties, Inc. | ||||
Net profit (loss) per share of common stock attributable to Regional Health Properties, Inc., basic | $ 22.68 | $ (2.02) | $ 21.74 | $ (4.93) |
Net profit (loss) per share of common stock attributable to Regional Health Properties, Inc., diluted | $ 22.68 | $ (2.02) | $ 21.73 | $ (4.93) |
Weighted average shares of common stock outstanding: | ||||
Basic (in shares) | 1,883,028 | 1,768,720 | 1,872,636 | 1,775,637 |
Diluted (in shares) | 1,883,253 | 1,768,720 | 1,873,489 | 1,775,637 |
Patient Care Revenues | ||||
Revenues: | ||||
Patient care, management fees and other revenues | $ 2,526 | $ 4,570 | $ 4,442 | $ 6,881 |
Rental Revenue | ||||
Revenues: | ||||
Patient care, management fees and other revenues | 1,722 | 3,261 | 3,430 | 7,326 |
Management Fees | ||||
Revenues: | ||||
Patient care, management fees and other revenues | 247 | 255 | 525 | 519 |
Other Revenues | ||||
Revenues: | ||||
Patient care, management fees and other revenues | $ 103 | $ 7 | $ 107 | $ 14 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Shares of Common Stock Outstanding | Shares of Treasury Stock | Common stock and additional paid-in capital | Accumulated Deficit | Series A Preferred Stock | Series A Preferred Stock Shares of Preferred Stock | Series A Preferred Stock Preferred Stock | Series B Preferred Stock | Series B Preferred Stock Shares of Preferred Stock | Series B Preferred Stock Preferred Stock |
Balance at Dec. 31, 2021 | $ 10,396 | $ 62,515 | $ (114,542) | $ 62,423 | |||||||
Balance (in shares) at Dec. 31, 2021 | 1,775,000 | (1,000) | |||||||||
Balance (in shares) at Dec. 31, 2021 | 2,812,000 | ||||||||||
Restricted stock issuance (in shares) | 24,000 | ||||||||||
Stock-based compensation | 111 | 111 | |||||||||
Exercise of restricted share awards net settlement option | (46) | (46) | |||||||||
Exercise of restricted share awards net settlement option (in shares) | (8,000) | ||||||||||
Net loss | (2,927) | (2,927) | |||||||||
Balance at Mar. 31, 2022 | 7,534 | 62,580 | (117,469) | 62,423 | |||||||
Balance (in shares) at Mar. 31, 2022 | 1,799,000 | (9,000) | |||||||||
Balance (in shares) at Mar. 31, 2022 | 2,812,000 | ||||||||||
Balance at Dec. 31, 2021 | 10,396 | 62,515 | (114,542) | 62,423 | |||||||
Balance (in shares) at Dec. 31, 2021 | 1,775,000 | (1,000) | |||||||||
Balance (in shares) at Dec. 31, 2021 | 2,812,000 | ||||||||||
Net loss | (4,252) | ||||||||||
Balance at Jun. 30, 2022 | 6,213 | 62,584 | (118,794) | 62,423 | |||||||
Balance (in shares) at Jun. 30, 2022 | 1,769,000 | (9,000) | |||||||||
Balance (in shares) at Jun. 30, 2022 | 2,812,000 | ||||||||||
Balance at Mar. 31, 2022 | 7,534 | 62,580 | (117,469) | 62,423 | |||||||
Balance (in shares) at Mar. 31, 2022 | 1,799,000 | (9,000) | |||||||||
Balance (in shares) at Mar. 31, 2022 | 2,812,000 | ||||||||||
Forfeitures of stock based awards | 4 | 4 | |||||||||
Forfeitures of stock based awards (in shares) | (30,000) | ||||||||||
Net loss | (1,325) | (1,325) | |||||||||
Balance at Jun. 30, 2022 | 6,213 | 62,584 | (118,794) | 62,423 | |||||||
Balance (in shares) at Jun. 30, 2022 | 1,769,000 | (9,000) | |||||||||
Balance (in shares) at Jun. 30, 2022 | 2,812,000 | ||||||||||
Balance at Dec. 31, 2022 | $ 3,716 | 62,702 | (121,409) | 62,423 | |||||||
Balance (in shares) at Dec. 31, 2022 | 1,793,000 | 1,784,000 | (9,000) | ||||||||
Balance (in shares) at Dec. 31, 2022 | 2,812,000 | 2,812,000 | 0 | ||||||||
Restricted stock issuance (in shares) | 99,000 | ||||||||||
Stock-based compensation | $ 81 | 81 | |||||||||
Net loss | (1,992) | (1,992) | |||||||||
Balance at Mar. 31, 2023 | 1,805 | 62,783 | (123,401) | 62,423 | |||||||
Balance (in shares) at Mar. 31, 2023 | 1,883,000 | (9,000) | |||||||||
Balance (in shares) at Mar. 31, 2023 | 2,812,000 | ||||||||||
Balance at Dec. 31, 2022 | $ 3,716 | 62,702 | (121,409) | 62,423 | |||||||
Balance (in shares) at Dec. 31, 2022 | 1,793,000 | 1,784,000 | (9,000) | ||||||||
Balance (in shares) at Dec. 31, 2022 | 2,812,000 | 2,812,000 | 0 | ||||||||
Net loss | $ (2,676) | ||||||||||
Balance at Jun. 30, 2023 | $ 1,275 | 62,938 | (80,691) | 426 | $ 18,602 | ||||||
Balance (in shares) at Jun. 30, 2023 | 1,894,000 | 1,883,000 | (11,000) | ||||||||
Balance (in shares) at Jun. 30, 2023 | 560,000 | 560,000 | 2,252,272 | 2,252,000 | |||||||
Balance at Mar. 31, 2023 | $ 1,805 | 62,783 | (123,401) | 62,423 | |||||||
Balance (in shares) at Mar. 31, 2023 | 1,883,000 | (9,000) | |||||||||
Balance (in shares) at Mar. 31, 2023 | 2,812,000 | ||||||||||
Extinguishment of Series A Preferred Stock (in shares) | (2,252,000) | ||||||||||
Extinguishment of Series A Preferred Stock | (61,997) | (61,997) | |||||||||
Exchange of Series A to Series B (in shares) | 2,252,000 | ||||||||||
Exchange of Series A to Series B | 61,997 | 43,395 | 18,602 | ||||||||
Stock-based compensation | 155 | 155 | |||||||||
Forfeitures of stock based awards (in shares) | (2,000) | ||||||||||
Net loss | (685) | (685) | |||||||||
Balance at Jun. 30, 2023 | $ 1,275 | $ 62,938 | $ (80,691) | $ 426 | $ 18,602 | ||||||
Balance (in shares) at Jun. 30, 2023 | 1,894,000 | 1,883,000 | (11,000) | ||||||||
Balance (in shares) at Jun. 30, 2023 | 560,000 | 560,000 | 2,252,272 | 2,252,000 |
CONSOLIDATED STATEMENTS OF ST_2
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - $ / shares | Jun. 30, 2023 | Jun. 30, 2022 |
Series A Preferred Stock | ||
Preferred stock, par value | $ 0 | |
Series A Preferred Stock | Preferred Stock | ||
Preferred stock, par value | 0 | $ 0 |
Series B Preferred Stock | ||
Preferred stock, par value | 0 | |
Series B Preferred Stock | Preferred Stock | ||
Preferred stock, par value | $ 0 | $ 0 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Cash flows from operating activities: | ||
Net loss | $ (2,676) | $ (4,252) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 1,212 | 1,219 |
Stock-based compensation expense | 236 | 115 |
Rent expense (less than) in excess of cash paid | (11) | 153 |
Rent revenue less than (in excess) of cash received | (236) | (73) |
Amortization of deferred financing costs, debt discounts and premiums | 37 | 44 |
Bad debt expense | 40 | 2,227 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 3,512 | (3,446) |
Prepaid expenses and other assets | 797 | 358 |
Accounts payable and accrued expenses | (460) | 1,138 |
Other liabilities | 504 | (281) |
Net cash provided by (used in) operating activities | 2,955 | (2,798) |
Cash flows from investing activities: | ||
Purchase of property and equipment | (854) | (152) |
Net cash used in investing activities | (854) | (152) |
Cash flows from financing activities: | ||
Payment of senior debt | (624) | (806) |
Payment of other debt | (504) | (572) |
Debt extinguishment and issuance costs | (17) | |
Proceeds from other debt | 50 | |
Repurchase of common stock | (46) | |
Net cash used in financing activities | (1,145) | (1,374) |
Net change in cash and restricted cash | 956 | (4,324) |
Cash and restricted cash, beginning | 3,909 | 9,848 |
Cash and restricted cash, ending | 4,865 | 5,524 |
Supplemental disclosure of cash flow information: | ||
Cash interest paid | 1,312 | 1,256 |
Supplemental disclosure of non-cash activities: | ||
Vendor-financed insurance | 962 | $ 1,078 |
Exchange of preferred stock Series A to Series B | 18,602 | |
Gain on extinguishment of preferred stock | $ 43,395 |
Organization and Significant Ac
Organization and Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Organization and Significant Accounting Policies | NOTE 1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES Description of Business Regional Health Properties, Inc.'s (the "Company" or "Regional Health") predecessor was incorporated in Ohio on August 14, 1991, under the name Passport Retirement, Inc. In 1995, Passport Retirement, Inc. acquired substantially all of the assets and liabilities of AdCare Health Systems, Inc. and changed its name to AdCare Health Systems, Inc. ("AdCare"). AdCare completed its initial public offering in November 2006, relocated its executive offices and accounting operations to Georgia in 2012, and changed its state of incorporation from Ohio to Georgia in December 2013. Regional Health Properties, Inc. is a self-managed real estate investment company that invests primarily in real estate purposed for long-term care and senior housing. Our business primarily consists of leasing such facilities to third-party tenants, which operate the facilities. The Company has two primary reporting segments: (i) Real Estate Services, which consists of the leasing and subleasing of long-term care and senior living facilities to third-party tenants, including the Company's management of three facilities on behalf of third-party owners; and (ii) Healthcare Services, which consists of the operation of the Meadowood and Glenvue facilities. Effective August 3, 2023, the Company’s 12.5 % Series B Cumulative Redeemable Preferred Shares (the “Series B Prefer red Stock”) is quoted on the OTC Markets Group, Inc.’s OTCQB Venture Market under the symbol “RHEPB”. Basis of Presentation The accompanying consolidated financial statements are prepared in conformity with U.S. generally accepted accounting principles ("GAAP") in accordance with the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC"). The accompanying consolidated financial statements are unaudited and should be read in conjunction with the 2022 audited consolidated financial statements and notes thereto, which are included in our 2022 Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC") on April 14, 2023 ("Annual Report"). In the opinion of management, the unaudited consolidated financial statements for the interim periods presented include all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the Company's financial position and the results of its operations and cash flows for such periods presented. The results of operations for such interim periods are not necessarily indicative of the results to be expected for the full year. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the unaudited consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. Reclassifications Certain reclassifications have been made to the amounts in prior periods in order to conform to the current period's presentation. A reclassification has been made to the stock balances on the consolidated statement of stockholders’ equity in prior periods in order to conform to the current period's presentation. Principles of Consolidations The consolidated financial statements include the Company's majority owned and controlled subsidiaries. All intercompany transactions and balances have been eliminated through consolidation . Variable Interest Entities The Company has a loan receivable with Peach Health, a sublessee. Such agreement creates a variable interest in the Peach Health sublessee that may absorb some or all of the expected losses of the entity. The Company does not consolidate the operating activities of the Peach Health sublessee as the Company does not have the power to direct the activities that most significantly impact the entity's economic performance. Revenue Recognition and Allowances Patient Care Revenue. ASC Topic 606, Revenue from Contracts with Customers requires a company to recognize revenue when the company transfers control of promised goods and services to a customer. Revenue is recognized in an amount that reflects the consideration to which a company expects to receive in exchange for such goods and services. Revenue from our Healthcare Services business segment is derived from services rendered to patients in the Meadowood and Glenvue facilities. The Company receives payments from the following sources for services rendered in our facilities: (i) the federal government under the Medicare program administered by the U.S. Department of Health and Human Services Centers for Medicare and Medicaid Services ("CMS"); (ii) state governments under their respective Medicaid and similar programs; (iii) commercial insurers; and (iv) individual patients and clients. The vast majority of the revenue the Company recognizes is from government sources. The Company determines the transaction price based on established billing rates reduced by contractual adjustments provided to third-party payors, discounts provided to uninsured patients and other price concessions. Contractual adjustments and discounts are based on contractual agreements, discount policies and historical experience. The Company recognizes revenue at the amount that reflects the consideration the Company expects to receive in exchange for the services provided. These amounts are due from residents or third-party payors and include variable consideration for retroactive adjustments from estimated reimbursements, if any, under reimbursement programs. Performance obligations are determined based on the nature of the services provided. Revenue is recognized as performance obligations are satisfied. Estimated uncollectable amounts due from patients are generally considered implicit price concessions that are a direct reduction to net operating revenues. Triple-Net Leased Properties. The Company recognizes rental revenue in accordance with ASC 842, Leases . The Company's triple-net leases provide for periodic and determinable increases in rent. The Company recognizes rental revenues under these leases on a straight-line basis over the applicable lease term when collectability is probable. Recognizing rental income on a straight-line basis generally results in recognized revenues during the first half of a lease term exceeding the cash amounts contractually due from our tenants, creating a straight-line rent receivable that is included in the straight-line rent receivable on our consolidated balance sheets. In the event the Company cannot reasonably estimate the future collection of rent from one or more tenant(s) of the Company's facilities, rental income for the affected facilities is recognized only upon cash collection, and any accumulated straight-line rent receivable is expensed in the period in which the Company deems rent collection to no longer be probable. Management Fee Revenues and Other Revenues . The Company recognizes management fee revenues as services are provided. The Company has one contract to manage three facilities (the "Management Contract"), with payment for each month of service generally received in full on a monthly basis. The maximum penalty for service contract nonperformance under the Management Contract is $ 50,000 per year, payable after the end of the year. Further, the Company recognizes interest income from loans and investments, using the effective interest method when collectability is probable. The Company applies the effective interest method on a loan-by-loan basis. On June 30, 2023, the Company received a notice of termination, pursuant to which the Management Contract will terminate on December 31, 2023. Allowances. The Company assesses the collectability of its rent receivables, including straight-line rent receivables, working capital loans to tenants and patient reimbursement. The Company bases its assessment of the collectability of rent receivables and working capital loans to tenants on several factors, including payment history, the financial strength of the tenant and any guarantors, the value of the underlying collateral, and current economic conditions. If the Company's evaluation of these factors indicates it is probable that the Company will be unable to receive the rent payments or payments on a working capital loan, then the Company provides a reserve against the recognized straight-line rent receivable asset or working capital loan for the portion that we estimate may not be recovered. Payments received on impaired loans are applied against the allowance. If the Company changes its assumptions or estimates regarding the collectability of future rent payments, then the Company may adjust its reserve to the rental or interest revenue recognized in the period the Company makes such change. See Note 6 – Leases. Regarding patient reimbursements, the Company assesses the patient receivable based on payor type and age of the receivable amongst several other factors. The Company has reserved for approximately 1.5 % o f our patient care revenue based on the historical performance and industry practices. As of June 30, 2023 and December 31, 2022, the Company reserved for approximately $ 1.4 million and $ 1.3 million , respectively, of uncollected receivables. Accounts receivable, net of allowance, totaled $ 3.0 million at June 30, 2023 and $ 6.3 million at December 31, 2022. The following table presents the Company's Accounts receivable, net of allowance for the periods presented: (Amounts in 000’s) June 30, 2023 December 31, 2022 Gross receivables Real Estate Services $ 1,143 $ 1,094 Healthcare Services 3,280 6,493 Subtotal 4,423 7,587 Allowance Real Estate Services ( 338 ) ( 338 ) Healthcare Services ( 1,062 ) ( 960 ) Subtotal ( 1,400 ) ( 1,298 ) Accounts receivable, net of allowance $ 3,023 $ 6,289 Prepaid Expenses and Other As of June 30, 2023 and December 31, 2022, the Company had approximately $ 1.2 million and $ 0.7 million , respectively, in prepaid expenses and other; the $ 0.5 million increase is related to insurance for the Meadowood and Glenvue facility operations, while the other amounts are predominantly for directors' and officers' insurance, NYSE American annual fees, and mortgage insurance premiums. Accounts Payable The following table presents the Company's Accounts payable for the periods presented: (Amounts in 000’s) June 30, 2023 December 31, 2022 Accounts payable Real Estate Services $ 1,247 $ 797 Healthcare Services 1,789 2,496 Total Accounts payable $ 3,036 $ 3,293 Other Expense, net The Company retained a law firm to evaluate and assist with possible opportunities to improve the Company's capital structure. For the six months ended June 30, 2023 and June 30, 2022 , these costs were $ 0.5 million and $ 0.9 million, respectively. Leases and Leasehold Improvements The Company leases certain facilities and equipment in the normal course of business. At the inception of each lease, the Company performs an evaluation to determine whether the lease should be classified as an operating lease or finance lease. As of June 30, 2023, all of the Company's leased facilities are accounted for as operating leases. For operating leases that contain scheduled rent increases, the Company records rent expense on a straight-line basis over the term of the lease. Leasehold improvements are amortized over the shorter of the useful life of the asset or the lease term. The Company recognizes both right of use assets and lease liabilities for leases in which we lease land, real property, or other equipment. We assess any new contracts or modification of contracts in accordance with ASC 842, Leases to determine the existence of a lease and its classification. We report revenues and expenses for real estate taxes and insurance where the lessee has not made those payments directly to a third-party in accordance with its respective leases with us. Additionally, we expense certain leasing costs, other than leasing commissions, as they are incurred. The present value of minimum lease payments was calculated on each lease, using a discount rate of 3.85 % that approximated our incremental borrowing rate and the current lease term. See Note 6– Leases for more information on the Company's operating leases. Insurance We maintain general liability, professional liability, and other insurance policies in amounts and with coverage and deductibles we believe are appropriate, based on the nature and risks of our business, historical experience, availability, and industry standards, including for the operations at the Glenvue and Meadowood facilities. Our current policies provide for deductibles for each claim and contain various exclusions from coverage. The Company has self-insured against professional and general liability claims related to its healthcare operations that were discontinued during 2014 and 2015 in connection with its transition from an owner and operator of healthcare properties to a healthcare property holding and leasing company (the "Transition"). For further information, see Note 11 – Commitments and Contingencies , and Note 13 – Commitments and Contingencies, to the consolidated financial statements for the year ended December 31, 2022 for more information. The Company evaluates quarterly the adequacy of its self-insurance reserve based on a number of factors, including: (i) the number of actions pending and the relief sought; (ii) analyses provided by defense counsel, medical experts or other information which comes to light during discovery; (iii) the legal fees and other expenses anticipated to be incurred in defending the actions; (iv) the status and likely success of any mediation or settlement discussions, including estimated settlement amounts and legal fees and other expenses anticipated to be incurred in such settlement, as applicable; and (v) the venues in which the actions have been filed or will be adjudicated. The Company believes that most of the professional and general liability actions are defensible and intends to defend them through final judgment unless settlement is more advantageous to the Company. Accordingly, the self-insurance reserve reflects the Company's estimate of settlement amounts for the pending actions, if applicable, and legal costs of settling or litigating the pending actions, as applicable. Because the self-insurance reserve is based on estimates, the amount of the self-insurance reserve may not be sufficient to cover the settlement amounts actually incurred in settling the pending actions, or the legal costs actually incurred in settling or litigating the pending actions. See Note 7 – Accrued Expenses . In addition, the Company maintains certain other insurance programs, including commercial general liability, property, casualty, directors' and officers' liability, crime, and employment practices liability. Discontinued Operations Prior to December 2015, the Company’s business focused primarily on owning and operating skilled nursing facilities ("SNF") and managing such facilities for unaffiliated owners with whom the Company had management contracts. These operations were discontinued and transitioned to the leasing model of business. As of June 30, 2023 and December 21, 2022 the Company determined remaining escheatment liabilities for discontinued operations are $ 0.8 million and are included in accrued expenses. Net Loss Per Share Basic net loss per share is computed by dividing net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the respective period. Diluted earnings per share is similar to basic net loss per share except that the net loss is adjusted by the impact of the weighted-average number of shares of common stock outstanding including potentially dilutive securities (such as options, warrants and non-vested common stock) when such securities are not anti-dilutive. Potentially dilutive securities from options, warrants and unvested restricted shares are calculated in accordance with the treasury stock method, which assumes that proceeds from the exercise of all options and warrants with exercise prices exceeding the average market value are used to repurchase common stock at market value. The incremental shares remaining after the proceeds are exhausted represent the potentially dilutive effect of the securities. Securities outstanding that were excluded from the computation, because they would have been anti-dilutive were as follows: June 30, (Share amounts in 000’s) 2023 2022 Stock options 13 13 Warrants - employee 32 34 Warrants - non employee 1 5 Total anti-dilutive securities 46 52 The weighted average contractual terms in years for these securities as of June 30, 2023 , with no intrinsic value, are 0.4 years for the stock options and 1.5 years for the warrants. New Accounting Pronouncements Issued But Not Yet Effective In March 2023, the FASB issued ASU 2023-01, Leases (Topic 842): Common Control Arrangements (Topic 842) amendments, which requires entities to determine whether related party arrangements between entities under common control are leases. The amendments also address the accounting treatment of leasehold improvements associated with common control leases. They require the lessee to amortize leasehold improvements over the useful life of the improvements to the common control group, regardless of the lease term, as long as the lessee controls the use of the underlying asset. If the lessee no longer controls the use of the asset, the leasehold improvements are accounted for as a transfer between entities under common control through an adjustment to equity. These improvements are also subject to impairment guidance in Topic 360, Property, Plant, and Equipment. The amendment is effective for public entities beginning after December 15, 2023. The Company is currently evaluating the impact of ASU 2023-01 on its financial statements. No other new accounting pronouncement issued or effective has had, or is expected to have, a material impact on the Company's financial statements. |
Liquidity
Liquidity | 6 Months Ended |
Jun. 30, 2023 | |
Liquidity [Abstract] | |
Liquidity | NOTE 2. LIQUIDITY Overview The Company intends to pursue measures to grow its operations, streamline its cost infrastructure and otherwise increase liquidity, including: (i) refinancing or repaying debt to reduce interest costs and mandatory principal repayments, with such repayment to be funded through potentially expanding borrowing arrangements with certain lenders; (ii) increasing future lease revenue through acquisitions and investments in existing properties; (iii) modifying the terms of existing leases; (iv) replacing certain tenants who default on their lease payment terms; and (v) reducing other and general and administrative expenses. Management anticipates access to several sources of liquidity, including cash on hand, cash flows from operations, and debt refinancing, during the twelve months following the date of this filing. At June 30, 2023, the Company had $ 1.9 million in unrestricted cash. During the six months ended June 30, 2023, the Company's cash provided by operating activities was $ 3.0 million primarily due to collection of the Employee Retention Tax Credit. The Company is seeking collection of the past due rent. In addition, management is working to expedite the time it takes to collect and receive aged patient receivables. Cash flow from operations in the future will be based on the operational performance of the facilities under the company's management, Glenvue and Meadowood, as well as continued uncertainty of the COVID-19 pandemic and its impact on the Company's business, financial condition and results of operations. Series A Preferred Stock Exchange Offer In connection with the completion of the Exchange Offer and the implementation of the Series A Charter Amendments and the Series B Charter Amendments, the liquidation preference of the Series A Preferred Stock was reduced, accumulated and unpaid dividends on the Se ries A Preferred Stock were eliminated and future dividends on the Series A Preferred Stock were eliminated. As a result, $ 50.4 million in accumulated and unpaid dividends on the Series A Preferred Stock were eliminated and, as of June 30, 2023, there are no accumulated and unpaid dividends on the Series A Preferred Stock. For further information regarding the Exchange Offer, Series A Charter Amendments and Series B Charter Amendments, see Note 9 – Common and Preferred Stock . Debt As of June 30, 2023, the Company had $ 52.0 million in indebtedness, net of $ 1.1 million deferred financing costs and unamortized discounts. The Company anticipates net principal repayments of approximately $ 2.5 million during the next twelve-month period, approximately $ 1.4 million of routine debt service amortization, $ 1.0 million of insurance financing amortization, and a $ 0.1 million payment of bond debt. Debt Extinguishment On December 30, 2022, the Company extended the maturity date on approximately $ 0.5 million other debt from August 25, 2023 to August 25, 2025 (the "Key Bank Exit Notes"). For further information, see Note 8 – Notes Payable and Other Debt. On October 21, 2022, the Company, through wholly-owned subsidiaries, consummated a U.S. Department of Housing and Urban Development ("HUD") refinancing of its senior mortgages on three SNFs in Ohio. Funding was provided by Newpoint Real Estate Capital LLC ("Newpoint") pursuant to three HUD guaranteed secured Healthcare Facility Notes (the "HUD Notes"). Proceeds from the HUD Notes were used to pay off existing HUD guaranteed secured mortgages and pay transaction costs. Newpoint is the servicer on other loans extended to the Company. Consequently, the Company recorded a net loss of approximately $ 0.4 million on extinguishment of debt during the year ended December 31, 2022, consisting of a $ 0.2 million prepayment penalty and $ 0.2 million of expensed deferred financing fees associated with the extinguishment of the Eaglewood Care Center, The Pavilion Care Center, and Hearth & Care of Greenfield loans. The aggregate principal amount of the three HUD Notes is $ 7.6 million , and the interest rate on the three HUD Notes is 3.97 % fixed for the full term of each HUD Note. The Northwood HUD Note has a principal amount of $ 4.9 million and matures on November 1, 2052 . The Greenfield HUD Note has a principal amount of $ 1.9 million and matures on November 1, 2050 . The Pavilion HUD Note has a principal amount of $ 0.8 million and matures on December 1, 2039 . Payments of principal and interest on the HUD Notes commenced on October 1, 2022. Each HUD Note is secured by a Healthcare Deed to Secure Debt, Security Agreement and Assignment of Rents covering the facilities. Newpoint may declare the loans, accrued interest and any other amounts immediately due and payable upon certain customary events of default. Debt Covenant Compliance At June 30, 2023, the Company was in compliance with the various financial and administrative covenants related to all of the Company's credit facilities. Changes in Operational Liquidity COVID-19 . Many of our operators have reported incurring significant cost increases as a result of the COVID-19 pandemic. We believe these increases primarily stem from elevated labor costs, including increased use of overtime and bonus pay, as well as a significant increase in both the cost and usage of personal protective equipment, testing equipment, processes and supplies. In terms of occupancy levels, many of our operators have reported experiencing declines, in part due to the elimination or suspension of elective hospital procedures, fewer discharges from hospitals to SNFs, and higher hospital readmittances from SNFs. The COVID-19 pandemic may also lead to temporary closures of nursing facilities operated by our tenants, impairing our tenants’ ability to make their rental payments to us pursuant to their respective lease agreements. Portfolio Stabilization Measures . In the past, our operators did not provide lease guarantees from affiliated entities. Given this, certain operators have terminated their leases in light of operational difficulties caused by the COVID-19 pandemic. While the Company is a self-managed real estate investment company that invests in real estate, when business conditions require, the Company undertakes portfolio stabilization measures. The table below summarizes the lease terminations related to existing properties as of June 30, 2023 since the onset of the COVID-19 pandemic and the Company’s resulting portfolio stabilization measures: Date Facility Name Former Operator Current Operator April 2022 Meadowood C.R. Management Regional Health (managed by Cavalier Senior Living Operations) August 2022 Glenvue C.R. Management Regional Health For more information, see Note 1 – Organization and Significant Accounting Policies, Note 6 – Leases and Note 12 – Segment Results . Capital Requirements . The operation of the facilities list above will require additional working capital, which is partially offset by cash flow received from the operation of these facilities. Since January, 2021, the Company's Accounts Receivable, net of allowance and Accounts Payable for the Healthcare Services segment have grown to $ 2.2 million and $ 1.8 million, respectfully. On December 30, 2022, the Company and Spring Valley, LLC (“Spring Valley”) entered into a Lease Termination Agreement (the “Lease Termination Agreement”) relating to the lease of the following eight nursing facilities: the Powder Springs facility, the Thomasville facility, the Jeffersonville facility, the Lumber City facility, the LaGrange facility, the Tara facility, the Oceanside facility and the Savannah Beach facility (collectively, the “Facilities”). The Lease Termination Agreement terminated the lease effective December 7, 2022 (the “Lease Termination Date”). Since the termination, management has been focusing on collecting the Accounts Receivable and paying the Accounts Payable associated with the referenced facilities. Evaluation of the Company's Ability to Continue as a Going Concern Under the accounting guidance related to the presentation of financial statements, the Company is required to evaluate, on a quarterly basis, whether or not the Company's current financial condition, including its sources of liquidity at the date that the consolidated financial statements are issued, will enable the Company to meet its obligations as they come due arising within one year of the date of the issuance of the Company's consolidated financial statements and to make a determination as to whether or not it is probable, under the application of this accounting guidance, that the Company will be able to continue as a going concern. The Company's consolidated financial statements have been presented on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. In applying applicable accounting guidance, management considered the Company's current financial condition and liquidity sources, including current funds available, forecasted future cash flows, the Company's obligations due over the next twelve months, and the Company's recurring business operating expenses. The Company concluded that it is probable that the Company will be able to meet its obligations arising within one year of the date of issuance of these consolidated financial statements within the parameters set forth in the accounting guidance. |
Cash and Restricted Cash
Cash and Restricted Cash | 6 Months Ended |
Jun. 30, 2023 | |
Restricted Cash and Investments [Abstract] | |
Cash and Restricted Cash | NOTE 3. CASH AND RESTRICTED CASH The following presents the Company's cash and restricted cash: (Amounts in 000’s) June 30, 2023 December 31, 2022 Cash $ 1,926 $ 843 Restricted cash: Cash collateral $ 76 $ 135 HUD and other replacement reserves 2,094 2,155 Escrow deposits 452 459 Restricted investments for debt obligations 317 317 Total restricted cash 2,939 3,066 Total cash and restricted cash $ 4,865 $ 3,909 Cash collateral— In securing mortgage financing from certain lending institutions, the Company and certain of its wholly-owned subsidiaries are required to deposit cash to be held as collateral in accordance with the terms of such loan agreements. HUD and other replacement reserves— The regulatory agreements entered into in connection with the financing secured through HUD require monthly escrow deposits for replacement and improvement of the HUD project assets. Escrow deposits— In connection with financing secured through the Company's lenders, several wholly-owned subsidiaries of the Company are required to make monthly escrow deposits for taxes and insurance. Restricted cash for debt obligations —In compliance with certain financing and insurance agreements, the Company and certain wholly-owned subsidiaries of the Company are required to deposit cash held as collateral by the lender or in escrow with certain designated financial institutions. |
Property and Equipment
Property and Equipment | 6 Months Ended |
Jun. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | NOTE 4. PROPERTY AND EQUIPMENT The following table sets forth the Company's property and equipment: (Amounts in 000’s) Estimated June 30, 2023 December 31, 2022 Buildings and improvements 5 - 40 $ 64,376 $ 63,746 Equipment and computer related 2 - 10 1,677 1,807 Land (1) — 2,774 2,774 Property and equipment 68,827 68,327 Less: accumulated depreciation and amortization ( 22,561 ) ( 21,716 ) Property and equipment, net $ 46,266 $ 46,611 (1) Includes $ 0.1 million of land improvements with an average estimated useful remaining life of approximately 5.5 years. The following table summarizes total depreciation and amortization expense three and six and months ended June 30, 2023 and 2022: Three Months Ended June 30, Six Months Ended June 30, (Amounts in 000’s) 2023 2022 2023 2022 Depreciation $ 593 $ 496 $ 993 $ 1,000 Amortization 109 110 219 219 Total depreciation and amortization expense $ 702 $ 606 $ 1,212 $ 1,219 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 6 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Goodwill | NOTE 5. INTANGIBLE ASSETS AND GOODWILL Intangible assets and Goodwill consist of the following: (Amounts in 000’s) Bed licenses Bed Licenses - Lease Total Goodwill (2) Balances, December 31, 2022 Gross $ 14,276 $ 2,471 $ 206 $ 16,953 $ 1,585 Accumulated amortization ( 4,583 ) — ( 96 ) ( 4,678 ) — Net carrying amount $ 9,693 $ 2,471 $ 110 $ 12,275 $ 1,585 Balances, June 30, 2023 Gross 14,276 2,471 206 16,953 1,585 Accumulated amortization ( 4,790 ) — ( 108 ) ( 4,898 ) — Net carrying amount $ 9,486 $ 2,471 $ 98 $ 12,055 $ 1,585 (1) Non-separable bed licenses are included in property and equipment as is the related accumulated amortization expense (see Note 4 – Property and Equipment ). (2) The Company does not amortize indefinite-lived intangibles, which consist of separable bed licenses and goodwill . The following table summarizes amortization expense for the three and six and months ended June 30, 2023 and 2022: Three Months Ended June 30, Six Months Ended June 30, (Amounts in 000’s) 2023 2022 2023 2022 Bed licenses $ 103 $ 104 $ 207 $ 207 Lease rights 6 6 12 12 Total amortization expense $ 109 $ 110 $ 219 $ 219 Expected amortization expense for the years ending December 31, for all definite-lived intangibles, for each of the next five years and thereafter is as follows: (Amounts in 000’s) Bed Lease 2023 (6 months remaining) $ 207 $ 12 2024 414 24 2025 414 24 2026 414 24 2027 414 14 Thereafter 7,623 - Total expected amortization expense $ 9,486 $ 98 |
Leases
Leases | 6 Months Ended |
Jun. 30, 2023 | |
Leases [Abstract] | |
Leases | NOTE 6. LEASES Facility Lessee As of June 30, 2023, the Company leased one SNF under a non-cancelable operating lease, which had rent escalation clauses and provisions for payments of real estate taxes, insurance, and maintenance costs. The Company also leased certain office space located in Suwanee, Georgia through the termination date of June 30, 2023. Effective July 1, 2023, the Company signed a sublease for 2,000 sq ft of office space in Dunwoody, GA. The sublease expires on July 31, 2025 . The remaining lease term for this one facility is approximately 5.8 years. As of June 30, 2023, the Company was in compliance with all operating lease financial covenants. Future Minimum Lease Payments Future minimum lease payments for the twelve months ending December 31, for each of the next five years and thereafter is as follows: (Amounts in 000’s) Future Accretion of Operating 2023 (6 months remaining) $ 312 $ ( 7 ) $ 305 2024 633 ( 50 ) 582 2025 645 ( 97 ) 549 2026 658 ( 141 ) 517 2027 671 ( 184 ) 487 Thereafter 914 ( 310 ) 604 Total $ 3,833 $ ( 789 ) $ 3,044 (1) Weighted a verage discount rate 3.85 %. Facilities Lessor As of June 30, 2023, the Company was the lessor of 9 of its 11 owned facilities, and the sublessor of one facility. These leases are triple net basis leases, meaning that the lessee (i.e., the third-party tenant of the property) is obligated for all costs of operating the property, including insurance, taxes and facility maintenance, as well as the lease or sublease payments to the Company. The weighted average remaining lease term for our 10 own ed and subleased out facilities is approximately 5.8 years. Future Minimum Lease Receivables Future minimum lease receivables for the twelve months ending December 31, for each of the next five years and thereafter is as follows: (Amounts 2023 (6 months remaining) $ 3,139 2024 6,187 2025 6,034 2026 5,362 2027 5,445 Thereafter 11,605 Total $ 37,772 For further details regarding the Company's leased and subleased facilities to third-party operators, including a full summary of the Company's leases to third-parties and which comprise the future minimum lease receivables of the Company, see Note 6 - Leases and Leasing Transactions in Part II, Item 8, Financial Statements and Supplementary Data, included in the Annual Report. |
Accrued Expenses
Accrued Expenses | 6 Months Ended |
Jun. 30, 2023 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | NOTE 7. ACCRUED EXPENSES Accrued expenses consist of the following: (Amounts in 000’s) June 30, 2023 December 31, Accrued employee benefits and payroll-related $ 356 $ 539 Real estate and other taxes (1) 2,667 2,428 Self-insured reserve 65 80 Accrued interest 223 210 Unearned rental revenue - 43 Medicaid overpayment - Healthcare Services 52 169 Insurance escrow 55 — Other accrued expenses 1,414 1,567 Total accrued expenses $ 4,832 $ 5,036 (1) June 30, 2023 includes approximately $ 2.3 million of franchise tax accruals for the Healthcare Services segment. December 31, 2022 includes approximately $ 2.2 million of franchise tax accruals for the Healthcare Services segment. |
Notes Payable and Other Debt
Notes Payable and Other Debt | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
Notes Payable and Other Debt | NOTE 8. NOTES PAYABLE AND OTHER DEBT See Note 8 – Notes Payable and Other Debt in Part II, Item 8, Financial Statements and Supplementary Data, included in the Annual Report for a detailed description of all the Company's debt facilities. Notes payable and other debt consists of the following: (Amounts in 000’s) June 30, 2023 December 31, Senior debt—guaranteed by HUD $ 29,384 $ 29,782 Senior debt—guaranteed by USDA (1) 7,403 7,526 Senior debt—guaranteed by SBA(2) 567 580 Senior debt—bonds 6,117 6,253 Senior debt—other mortgage indebtedness 8,175 8,266 Other debt 1,490 895 Subtotal 53,136 53,302 Deferred financing costs ( 988 ) ( 1,005 ) Unamortized discount on bonds ( 116 ) ( 119 ) Notes payable and other debt $ 52,032 $ 52,178 (1) U.S. Department of Agriculture ("USDA") (2) U.S. Small Business Administration ("SBA") The following is a detailed listing of the debt facilities that comprise each of the above categories: (Amounts in 000’s) Facility Lender Maturity Interest Rate (1) June 30, 2023 December 31, Senior debt - guaranteed by HUD (2) The Pavilion Care Center Newpoint Capital 12/01/2039 Fixed 3.97 % $ 819 $ 835 Hearth and Care of Greenfield Newpoint Capital 8/01/2050 Fixed 3.97 % 1,929 1,949 Woodland Manor Newpoint Capital 11/01/2052 Fixed 3.97 % 4,936 4,980 Glenvue Newpoint Capital 10/01/2044 Fixed 3.75 % 7,189 7,297 Autumn Breeze KeyBank 01/01/2045 Fixed 3.65 % 6,250 6,344 Georgetown Newpoint Capital 10/01/2046 Fixed 2.98 % 3,167 3,214 Sumter Valley KeyBank 01/01/2047 Fixed 3.70 % 5,095 5,163 Total $ 29,385 $ 29,782 Senior debt - guaranteed by USDA (3) Mountain Trace (4) Community B&T 12/24/2036 Prime + 1.75 % 9.25 % $ 3,610 $ 3,680 Southland (5) Cadence Bank, NA 07/27/2036 Prime + 1.50 % 9.00 % 3,793 3,846 Total $ 7,403 $ 7,526 Senior debt - guaranteed by SBA Southland(6) Cadence Bank, NA 07/27/2036 Prime + 2.25 % 9.75 % $ 567 $ 580 Total $ 567 $ 580 (1) Represents cash interest rates as of June 30, 2023 as adjusted for interest rate floor limitations, if applicable. The rates exclude amortization of deferred financing costs, which range from 0.09 % to 0.53 % per annum. (2) For the seven SNFs, the Company has term loans with financial institutions that are insured 100 % by HUD. The loans are secured by, among other things, an assignment of all rents paid under any existing or future leases and rental agreements with respect to the underlying facility. The loans contain customary events of default, including fraud or material misrepresentations or material omission, the commencement of a forfeiture action or proceeding, failure to make required payments, and failure to perform or comply with certain agreements. Upon the occurrence of certain events of default, the lenders may, after receiving the prior written approval of HUD, terminate the loans and all amounts under the loans will become immediately due and payable. In connection with entering into each loan, the Company entered into a healthcare regulatory agreement and a promissory note, each containing customary terms and conditions. Pursuant to the CARES Act, up to three months of debt service payments for six of the credit facilities can be made from our restricted cash reserves. (3) For the two SNFs, the Company has term loans with financial institutions that are insured 70 % to 80 % by the USDA. The loans have an annual renewal fee for the USDA guarantee of 0.25 % of the guaranteed portion. The loans had prepayment penalties of 1 %, capped at 1 % for the remainder of the first 10 years of the term and 0 % thereafter. (4) Pursuant to the CARES Act, the monthly principal and interest payments due May 1, 2020 through August 1, 2020 for the Mountain Trace Facility loan were deferred. Monthly payments that commenced on September 1, 2020 were being applied to current interest, then deferred interest until the deferred interest was paid in full on April 1, 2021. Payments have been re-amortized over the extended term of the loan. (5) Pursuant to the CARES Act, the monthly principal and interest payments due May 1, 2020 through October 1, 2020 for the loan for that certain 126 -bed SNF commonly known as Southland, located in Dublin, Georgia, were deferred as a part of the USDA Payment Program. Monthly payments recommenced on November 1, 2020 with payments through February 2021 being applied to principal and interest. Monthly payments that commenced on March 1, 2021 are being applied to current interest, then deferred interest until the deferred interest is paid in full, payments will be re-amortized over the extended term of the loan. (6) For the one SNF, commonly known as Southland, the Company has a term loan with a financial institution, which is 75 % insured by the SBA. The SBA funded two monthly debt payments during the three months ended March 31, 2021 and six payments commencing on March 1, 2020 and ending on August 1, 2020. (Amounts in 000’s) Facility Lender Maturity Interest Rate (1) June 30, 2023 December 31, 2022 Senior debt - bonds Eaglewood Bonds Series A City of Springfield, Ohio 05/01/2042 Fixed 7.65 % $ 6,117 $ 6,253 (1) Represents cash interest rates as of June 30, 2023. The rates exclude amortization of deferred financing of approximately 0.1 % per an num. (Amounts in 000’s) Facility Lender Maturity Interest Rate (1) June 30, 2023 December 31, Senior debt - other mortgage indebtedness Meadowood (2) Exchange Bank of Alabama 10/01/2026 Fixed 4.50 % $ 3,319 $ 3,319 Coosa (3) Exchange Bank of Alabama 10/10/2026 Fixed 3.95 % 4,856 4,946 Total $ 8,175 $ 8,266 (1) Represents cash interest rates as of June 30, 2023 as adjusted for interest rate floor limitations, if applicable. The rates exclude amortization of deferred financing costs of 0.34 % per annum. (2) On October 1, 2021, the Exchange Bank of Alabama and the Company extended the maturity date of the Meadowood Credit Facility which is secured by the Meadowood Facility and the assets of Coosa, and which is guaranteed by Regional Health Properties, Inc., from May 1, 2022 to October 1, 2026 . (3) On September 30, 2021, the Company refinanced the MCB Coosa Loan secured by the Coosa Facility, incurring approximately $ 0.1 million in new fees. The Coosa Credit Facility, guaranteed by Regional Health Properties, Inc. includes customary terms, including events of default with an associated annual 5 % default interest rate, and is secured by the Coosa Facility and the assets of Meadowood. Upon the occurrence of certain events of default, the lenders may terminate the Coosa Credit Facility and the Meadowood Credit Facility and all amounts due under both credit facilities will become immediately due and payable. The Coosa Credit Facility has prepayment penalties of 5 % in the first year, 4 % in the second year and 1 % thereafter. (Amounts in 000’s) Lender Maturity Interest Rate June 30, 2023 December 31, Other debt First Insurance Funding (1) Various 2023 Fixed 3.19 % $ 962 $ 357 Key Bank (2) 08/25/2025 Fixed 0.00 % 495 495 Marlin Capital Solutions 06/1/2027 Fixed 5.00 % 33 43 Total $ 1,490 $ 895 (1) Annual Insurance financing primarily for the Company's directors and officers insurance and professional liability for the facilities where the company is the licensed operator. (2) On December 30, 2022, Key Bank and the Company extended the maturity date from August 25, 2023 to August 25, 2025 . Debt Covenant Compliance As of June 30, 2023, the Company ha d 16 credit related instruments outstanding that include various financial and administrative covenant requirements. Covenant requirements include, but are not limited to, fixed charge coverage ratios, debt service coverage ratios, minimum earnings before interest, taxes, depreciation, and amortization or earnings before interest, taxes, depreciation, amortization, and restructuring or rent costs, and current ratios. Certain financial covenant requirements are based on consolidated financial measurements whereas others are based on measurements at the subsidiary level (i.e., facility, multiple facilities or a combination of subsidiaries). The subsidiary level requirements are as follows: (i) financial covenants measured against subsidiaries of the Company; and (ii) financial covenants measured against third-party operator performance. Some covenants are based on annual financial metric measurements, whereas others are based on monthly and quarterly financial metric measurements. The Company routinely tracks and monitors its compliance with its covenant requirements. As of June 30, 2023, the Company was in compliance with the various financial and administrative covenants under the Company's outstanding credit related instruments. Scheduled Maturities The schedule below summarizes the scheduled gross maturities as of June 30, 2023 for each of the next five years and thereafter. For the Twelve Months Ended December 31, (Amounts in 000’s) 2023 (6 months remaining) $ 1,263 2024 1,966 2025 2,157 2026 8,622 2027 1,421 Thereafter 37,707 Subtotal $ 53,136 Less: unamortized discounts ( 116 ) Less: deferred financing costs, net ( 988 ) Total notes and other debt $ 52,032 |
Common and Preferred Stock
Common and Preferred Stock | 6 Months Ended |
Jun. 30, 2023 | |
Stockholders' Equity Note [Abstract] | |
Common and Preferred Stock | NOTE 9. COMMON AND PREFERRED STOCK On June 27, 2023, the Company convened a special meeting (the “Special Meeting”) of the holders of its 10.875 % Series A Cumulative Redeemable Preferred Shares (the “Series A Preferred Stock”) and the holders of its common stock (the “Common Stock”) and Series E Redeemable Preferred Shares (the “Series E Preferred Stock”). The Special Meeting was called to consider the proposals set forth in the Company’s definitive proxy statement/prospectus filed with the SEC on May 25, 2023 (as supplemented or amended, the “Proxy Statement/Prospectus”) in connection with the Company’s offer to exchange (the “Exchange Offer”) any and all outstanding shares of the Series A Preferred Stock for newly issued shares of the Company’s Series B Preferred Stock. The expiration date (the “Expiration Date”) for the Exchange Offer was 11:59 p.m., New York City time, on June 27, 2023. All of the proposals presented at the Special Meeting were approved by the requisite votes of the applicable shareholders of the Company, including: • certain amendments to the Company’s Amended and Restated Articles of Incorporation (as in effect prior to such amendments, the “Prior Charter”) with respect to the Series A Preferred Stock to significantly reduce the rights of holders of Series A Preferred Stock (the “Series A Charter Amendments” and, such proposal, the “Preferred Series A Charter Amendment Proposal”); and • (i) a temporary amendment of the Prior Charter to increase the authorized number of shares of preferred stock to 6,000,000 shares and, following the consummation of the Exchange Offer, the subsequent amendment of the Prior Charter to decrease the authorized number of shares of preferred stock to 5,000,000 shares and (ii) the authorization, creation and designation by the Board of Directors of the Company (the “Board”), from the authorized but undesignated shares of preferred stock, of the Series B Preferred Stock (the “Series B Charter Amendments” and, such proposal, the “Series B Preferred Stock Proposal”); and • certain amendments to the Prior Charter relating to (i) the Series A Charter Amendments and (ii) the temporary amendment of the Prior Charter to increase the authorized number of shares of the Company to 61,000,000 shares, consisting of 55,000,000 shares of common stock and 6,000,000 shares of preferred stock, and, following the consummation of the Exchange Offer, the subsequent amendment of the Prior Charter to decrease the authorized number of shares of the Company to 60,000,000 shares, consisting of 55,000,000 shares of common stock and 5,000,000 shares of preferred stock (such proposal, the “Common Charter Amendment Proposal”). On June 30, 2023, the Company closed the Exchange Offer. Continental Stock Transfer & Trust Company, the exchange agent in connection with the Exchange Offer, notified the Company that 2,252,272 shares of Series A Preferred Stock had been properly tendered (and not validly withdrawn) in the Exchange Offer, representing approximately 80.1 % of the then outstanding shares of Series A Preferred Stock. All of the shares of Series A Preferred Stock properly tendered (and not validly withdrawn) prior to the Expiration Date pursuant to the Exchange Offer were accepted by the Company and were retired. On June 30, 2023, in exchange for each such share of Series A Preferred Stock, participating holders of Series A Preferred Stock received one share of Series B Preferred Stock, resulting in the issuance of 2,252,272 shares of Series B Preferred Stock. 559,263 shares of Series A Preferred Stock did not participate in the Exchange Offer and remain outstanding. On July 3, 2023, in connection with the closing of the Exchange Offer, the Company filed Amended and Restated Articles of Incorporation (the “Charter”) with the Secretary of State of the State of Georgia. Common Stock As of June 30, 2023, the Company had 55,000,000 shares of Common Stock authorized and 1,893,908 shares issued and 1,883,028 shares outstanding. There were no dividends declared or paid on the common stock during the three and six and months ended June 30, 2023 and 2022. Preferred Stock As of June 30, 2023, the Company had 5,000,000 shares of Preferred Stock authorized and 2,811,535 shares issued and outstanding. Series A Preferred Stock On June 27, 2023, certain Preferred Series A Charter Amendments were approved at the Special Meeting to (i) reduce the liquidation preference of the Series A Preferred Stock to $ 5.00 per share, (ii) eliminate accumulated and unpaid dividends on the Series A Preferred Stock, (iii) eliminate future dividends on the Series A Preferred Stock, (iv) eliminate penalty events and the right of holders of Series A Preferred Stock to elect directors upon the occurrence of a penalty event, (v) reduce the redemption price of the Series A Preferred Stock in the event of an optional redemption to $ 5.00 per share, (vi) reduce the redemption price of the Series A Preferred Stock in the event of a “change of control” to $ 5.00 per share and (vii) change the voting rights of holders of Series A Preferred Stock when voting as a single class with any other class or series of stock to one vote per $ 5.00 liquidation preference . The Company has accounted for the Series A Charter Amendments to the rights, preferences, and privileges of the Series A Preferred Stock as an extinguishment of the Series A Preferred Stock and issuance of new Series B Preferred Stock due to the significance of the modifications to the substantive contractual terms and the associated fundamental changes to the nature of the Series A Preferred Stock. Accordingly, the Company recorded an aggregate gain of $ 43.4 million within stockholders’ equity equal to the difference between the fair value of the new shares of Series B Preferred Stock issued and the carrying amount of the shares of Series A Preferred Stock extinguished. The gain on extinguishment is reflected in the calculation of net income (loss) available to common stockholders in accordance with FASB ASC Topic 260, Earnings per Share. The fair value of the Series A Preferred Stock was $ 0.76 per share based on a probability-weighted average of the expected return method. On June 30, 2023, in connection with the closing of the Exchange Offer, 2,252,272 shares of Series A Preferred Stock were retired and exchanged for 2,252,272 shares of Series B Preferred Stock. As of June 30, 2023, the Company had 559,263 shares of Series A Preferred Stock issued and outstanding, and the accumulated and unpaid dividends on the Series A Preferred Stock in the amount of $ 50.4 million were forfeited as part of the extinguishment. No dividends were declared or paid on the Series A Preferred Stock for the three and six and months ended June 30, 2023 and 2022 . Series B Preferred Stock The terms and provisions of the Series B Preferred Stock include, among other things: (i) no stated maturity and not being subject to any sinking fund or mandatory redemption, except following a change of control and the cumulative redemption provisions, (ii) ranks senior to our common stock, our Series A Preferred Stock and any other shares of our stock that we may issue in the future, the terms of which specifically provide that such stock ranks junior to the Series B Preferred Stock, in each case with respect to payment of dividends and amounts upon the occurrence of a liquidation event, (iii) dividend rate is 12.5 % per annum of the liquidation preference of the Series B Preferred Stock in effect on the first calendar day of the applicable dividend period, (iv) initial dividend period will commence July 1, 2027 , (v) liquidation preference is initially be $ 10.00 per share and will increase over time, pursuant to the terms set forth in the Charter, to $ 25.00 per share upon the fourth anniversary date of the original issuance date, provided that once there are 200,000 or fewer shares of the Series B Preferred Stock outstanding, the liquidation preference will be reduced to $ 5.00 per share; and (vi) the Company must redeem, repurchase or otherwise acquire certain amount of shares of Series B Preferred Stock through the fourth anniversary of the original date of issuance as provided in the Charter. The fair value of the Series B Preferred Stock was $ 8.26 per share based on a probability-weighted average of the expected return method. As of June 30, 2023, the Company had 2,252,272 shares of Series B Preferred Stock issued and outstanding. No dividends were declared or paid on the Series B Preferred Stock for the three and six and months ended June 30, 2023 and 2022. Series E Preferred Stock On February 13, 2023 , the Board declared a dividend of one one-thousandth of a share of Series E Preferred Stock for each outstanding share of common stock, payable on February 28, 2023 to shareholders of record at 5:00 p.m. Eastern Time on February 27, 2023 (the “Dividend Record Date”). The Articles of Amendment Establishing Series E Redeemable Preferred Shares were filed with the Secretary of State of the State of Georgia and became effective on February 14, 2023. The Series E Preferred Stock was distributed on February 28, 2023 to shareholders of record on the Dividend Record Date. All shares of Series E Preferred Stock were redeemed in connection with the Special Meeting. The Series E Preferred Stock designation has been eliminated from the Charter and, as of June 30, 2023, there are no shares of Series E Preferred Stock issued and outstanding. |
Stock Based Compensation
Stock Based Compensation | 6 Months Ended |
Jun. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock Based Compensation | NOTE 10. STOCK BASED COMPENSATION Stock Incentive Plans On November 4, 2020, the Board adopted, the Regional Health Properties, Inc. 2020 Equity Incentive Plan (the "2020 Plan"). The Company's shareholders approved the 2020 Plan on December 16, 2020 at the 2020 Annual Meeting of Shareholders of the Company. The maximum number of shares of common stock authorized for issuance under the 2020 Plan is 250,000 shares, subject to certain adjustments. No awards may be made under the 2020 Plan after the 10th anniversary of the date of shareholder approval of the 2020 Plan, and no incentive stock options may be granted after the 10th anniversary of the date of Board approval of the 2020 Plan. As of June 30, 2023 , the number of securities remaining available for future issuance under the 2020 Plan is 52,805 . The 2020 Plan replaced the AdCare Health Systems, Inc. 2011 Stock Incentive Plan, as amended (the "2011 Plan"), which was assumed by Regional Health pursuant to the Merger. The 2011 Plan was originally due to expire on March 28, 2021 and provided for a maximum of 168,950 shares of common stock to be issued. No additional awards may be granted under the 2011 Plan. The shares of common stock underlying any awards granted under the 2020 Plan or the 2011 Plan that are forfeited, canceled, or otherwise terminated (other than by exercise) will be added back to the shares of common stock available for issuance under the 2020 Plan. However, shares: (i) tendered or held back upon exercise of a stock option or other award under the 2020 Plan to cover the exercise price or tax withholding; and (ii) subject to a stock appreciation right that are not issued in connection with the stock settlement of the stock appreciation right upon exercise thereof, will not be added back to the shares of common stock available for issuance under the 2020 Plan. In addition, shares of common stock repurchased by the Company on the open market will not be added back to the shares of common stock available for issuance under the 2020 Plan. For the three and six and months ended June 30, 2023 and 2022, the Company recognized stock-based compensation expense as follows: Three Months Ended June 30, Six Months Ended June 30, (Amounts in 000’s) 2023 2022 2023 2022 Employee compensation: Stock compensation expense $ 155 $ 58 $ 236 $ 169 Forfeitures of stock based awards — ( 54 ) — ( 54 ) Total employee stock-based compensation expense $ 155 $ 4 $ 236 $ 115 As of June 30, 2023, the remaining stock-based compensation expense that is expected to be recognized in future periods is $ 0.4 million. Restricted Stock The following table summarizes the Company's restricted stock activity for the six months ended June 30, 2023: Number of Weighted Avg. Unvested, December 31, 2022 51 $ 8.99 Granted 99 $ 3.61 Vested ( 26 ) $ 9.06 Unvested, June 30, 2023 124 $ 4.68 The remaining unvested shares at June 30, 2023 will vest over the next 2.6 years with $ 0.4 million in compensation expense recognized over this period. Common Stock Options The following summarizes the Company's employee and non-employee stock option activity for the six months ended June 30, 2023: Number of Weighted Weighted Aggregate Outstanding, December 31, 2022 13 $ 47.53 0.5 $ — Granted 24 $ 3.32 9.5 $ — Outstanding and Vested, June 30, 2023 37 $ 18.63 6.6 $ 6.7 The aggregate intrinsic value of options outstanding and vested was calculated as the difference between the exercise price of the options and the fair value of the Company’s common stock as of June 30, 2023. The fair value of the common stock is the closing stock price of the Company's Common Stock. The following summary information reflects stock options outstanding, vested, and related details as of June 30, 2023: Stock Options Outstanding Stock Options Exercisable Exercise Price Number of Weighted Weighted Vested, June 30, 2023 Weighted $ 3.32 24 9.5 $ 3.32 24 $ 3.32 $ 46.80 - $ 48.72 13 0.4 $ 47.42 13 $ 47.42 Total 37 6.6 $ 18.63 37 $ 18.63 Common Stock Warrants The following summarizes the Company's employee and non-employee common stock warrant activity for the six months ended June 30, 2023: Outstanding and Exercisable Number of Weighted Weighted Outstanding and Vested, December 31, 2022 35 $ 53.31 1.9 Expired ( 2 ) $ 70.80 — Outstanding and Vested, June 30, 2023 33 $ 52.38 1.5 The Company has no unrecognized compensation expense related to common stock warrants as of June 30, 2023 . |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 11. COMMITMENTS AND CONTINGENCIES Regulatory Matters Laws and regulations governing federal Medicare and state Medicaid programs are complex and subject to interpretation. Compliance with such laws and regulations can be subject to future governmental review and interpretation as well as significant regulatory action including fines, penalties, and exclusion from certain governmental programs. As of June 30, 2023, all of the Company's facilities operated by Regional or leased and subleased to third-party operators and managed for third-parties are certified by CMS and are operational. See Note 6 - Leases . Legal Matters The Company is a party to various legal actions and administrative proceedings and is subject to various claims arising in the ordinary course of business, including claims that the services the Company provided during the time it operated SNFs resulted in injury or death to the patients of the Company's facilities and claims related to professional and general negligence, employment, staffing requirements and commercial matters. Although the Company intends to vigorously defend itself in these matters, there is no assurance that the outcomes of these matters will not have a material adverse effect on the Company's business, results of operations and financial condition. The Company previously operated, and the Company and its tenants now operate, in an industry that is highly regulated. As such, in the ordinary course of business, the Company and its tenants are continuously subject to state and federal regulatory scrutiny, supervision and control. Such regulatory scrutiny often includes inquiries, investigations, examinations, audits, site visits and surveys, some of which are non-routine. In addition, the Company believes that there has been, and will continue to be, an increase in governmental investigations of long-term care providers, particularly in the area of Medicare and Medicaid false claims, as well as an increase in enforcement actions resulting from these investigations. Adverse determinations in legal proceedings or governmental investigations against or involving the Company or its tenants, whether currently asserted or arising in the future, could have a material adverse effect on the Company's business, results of operations and financial condition. Professional and General Liability Claims Claims on behalf of the Company's Former Patients prior to the Transition As of June 30, 2023, the Company is a defendant in one professional and general liability action commenced on behalf of one of our former patients who received care at one of our facilities prior to the Transition. The plaintiff in this action alleges negligence due to failure to provide adequate and competent staff resulting in injuries, pain and suffering, mental anguish and malnutrition and seeks unspecified actual and compensatory damages, and unspecified punitive damages. This action is covered by insurance, except that any punitive damages awarded would be excluded from coverage. The case is set to go to trial on October 23, 2023. Claims on behalf of the Company's Former Patients After the Transition On May 2, 2023, Plaintiff Danielle Taylor, as Guardian and Conservator of Lynette Taylor filed suit against Tara Operator, LLC alleging negligent care and treatment of Ms. Taylor during her residence at Thunderbolt from June 12, 2021 through September 13, 2021. Specifically, Plaintiff’s claims relate to wound care management Ms. Taylor received while a resident at Thunderbolt. Plaintiff further alleges the Thunderbolt staff failed to develop reasonable interventions for Ms. Taylor’s care after wound development, failed to properly document her wounds, failed to maintain a consistent turning schedule or offloading of pressure, and failed to modify her care plan accordingly. According to Plaintiff, these failures resulted in Ms. Taylor needing bilateral, above the knee amputations of both legs. Plaintiff’s Complaint asserts the following causes of action: failure to exercise a reasonable degree of care and skill and breach of contract. Defendant responded with its Answer on June 28, 2023 and discovery is ongoing. Claims on behalf of the Company's Prior or Current Tenant's Former Patients after the Transition As of June 30, 2023, the Company is a defendant in an aggregate of 8 additional professional and general liability actions. These 9 additional professional and general liability actions were commenced on behalf of former patients of our current or prior tenants. These actions generally seek unspecified compensatory and punitive damages for former patients who were allegedly injured or died due to professional negligence or understaffing at the applicable facility operated by our tenants. These actions all relate to events which occurred after the Company transitioned the operations of the facilities in question to a third-party operator (and of which four such actions relate to events which occurred after the Company sold such facilities) and are subject to such operators' indemnification obligations in favor of the Company. There is no assurance that our tenants will have sufficient assets, income, access to financing and insurance coverage to enable them to satisfy their respective indemnification obligations. During the six months ended June 30, 2023 , the following professional and general liability action (included in the 10 actions mentioned above) related to our current or former tenant's former patients were filed against the Company. The resident’s daughter filed suit on behalf of Mr. Shellman on February 14, 2023 asserting claims of professional and ordinary negligence as well the alleged breach of various state and federal regulations. The lawsuit relates to Mr. Shellman’s residence at Glenvue nursing facility which was operated by C.R. of Glenvue, LLC which is also named as a defendant. Plaintiff’s counsel has agreed to extend the deadline for Glenvue H&R Property Holdings, LLC to respond to the lawsuit up to and including May 15, 2023 to enable him to review the response filed by C.R. of Glenvue, LLC and determine whether or not Plaintiff will agree to the dismissal of Glenvue H&R Property Holdings, LLC. If plaintiff does not agree, we intend to serve Plaintiff with a notice that Glenvue H&R Property Holdings, LLC constitutes an excluded party pursuant to O.C.G.A. 31-7-3.3. Should Plaintiff still not agree to the dismissal of Glenvue H&R Property Holdings, LLC, we will file a motion for summary judgment seeking judgment in its favor. The Court may require Glenvue H&R Property Holdings, LLC to participate in discovery prior to ruling on this motion. In the event that occurs, Glenvue H&R Property Holdings, LLC can seek the recovery of its attorneys fees and expenses pursuant to the above-referenced excluded party statute. The family of Mable Polite filed suit on March 15, 2023 asserting claims of professional and ordinary negligence as well the alleged breach of various state and federal regulations. The lawsuit relates to Ms. Polite’s residence at the Thunderbolt nursing facility from March 19, 2020 to March 20, 2021. Plaintiff has also asserted claims against 3223 Falligant Avenue Associates, LP and other Wellington related entities. 3223 Falligant Avenue was the operator and licensee of the facility for the first part of Ms. Polite’s residence prior to Tara Operator becoming the operator. Based upon the date the suit was filed, there is an argument that certain claimed acts of negligence are barred by the limitations period. Ms. Polite’s daughter signed an arbitration agreement on her admission to Thunderbolt but we are not in possession of a power of attorney or other documentation authorizing her to execute this agreement. Nonetheless, Tara Operator will file its answer to the Complaint (due April 14) via special appearance to reserve the right to seek arbitration should a power of attorney be located. Dismissed Claims on behalf of the Company's Prior or Current Tenant's Former Patients after the Transition In February 2023, the Company was dismissed from the case involving Ronald and Sarah Ross against our prior operator Symmetry Healthcare Management. The Company established a self-insurance reserve for its professional and general liability claims, included within Accrued expenses on the Company's consolidated balance sheets o f $ 0.1 million and $ 0.2 million as of June 30, 2023 and December 31, 2022, respectively. Additionally, as of June 30, 2023 and December 31, 2022, $ 0.1 million and $ 0.1 million, was reserved for settlement amounts in Accounts payable on the Company's consolidated balance s heets. For additional information regarding the Company's self-insurance reserve, see Note 13 – Commitments and Contingencies in Part II, Item 8, Financial Statements and Supplementary Data, included in the Annual Report. |
Segments Results
Segments Results | 6 Months Ended |
Jun. 30, 2023 | |
Segment Reporting [Abstract] | |
Segments Results | NOTE 12. SEGMENT RESULTS The Company has two primary reporting segments: (i) Real Estate Services, which consists of the leasing and subleasing of long-term care and senior living facilities to third-party tenants, including the Company's management of three facil ities on behalf of third-party owners; and (ii) Healthcare Services, which consists of the operation of the Meadowood and Glenvue facilities. The Company reports segment information based on the "management approach" defined in ASC 280, Segment Reporting . The management approach designates the internal reporting used by management for making decisions and assessing performance as the source of our reportable segments. The table below presents the results of operations for our reporting segments for the periods presented. Three Months Ended June 30, Three Months Ended June 30, Six Months Ended June 30, Six Months Ended June 30, 2023 2023 2023 2022 2022 2022 2023 2023 2023 2022 2022 2022 (Amounts in 000’s) Real Estate Services Healthcare Services Total Real Estate Services Healthcare Services Total Real Estate Services Healthcare Services Total Real Estate Services Healthcare Services Total Revenues: Patient care revenues $ — $ 2,526 $ 2,526 $ — $ 4,570 $ 4,570 $ — $ 4,442 $ 4,442 $ — $ 6,881 $ 6,881 Rental revenues 1,722 — 1,722 3,261 — 3,261 3,430 — 3,430 7,326 — 7,326 Management fees 247 — 247 255 — 255 525 — 525 519 — 519 Other revenues 103 — 103 7 — 7 107 — 107 14 — 14 Total revenues 2,072 2,526 4,598 3,523 4,570 8,093 4,062 4,442 8,504 7,859 6,881 14,740 Expenses: Patient care expense — 2,159 2,159 — 4,222 4,222 — 4,697 4,697 — 6,564 6,564 Facility rent expense 149 — 149 1,106 528 1,634 297 — 297 2,448 826 3,274 Cost of management fees 146 — 146 144 — 144 286 — 286 319 — 319 Depreciation and amortization 599 103 702 599 7 606 1,106 106 1,212 1,206 13 1,219 General and administrative expense 978 33 1,011 679 242 921 2,020 197 2,217 1,685 369 2,054 Doubtful accounts expense — 24 24 466 — 466 — 40 40 2,227 — 2,227 Other operating expenses 91 130 221 337 292 629 170 143 313 636 332 968 Total expenses 1,963 2,449 4,412 3,331 5,291 8,622 3,879 5,183 9,062 8,521 8,104 16,625 Income (loss) from operations 109 77 186 192 ( 721 ) ( 529 ) 183 ( 741 ) ( 558 ) ( 662 ) ( 1,223 ) ( 1,885 ) Other expense: Interest expense, net 601 78 679 636 3 639 1,279 80 1,359 1,266 25 1,291 Other expense, net 191 1 192 157 — 157 541 218 759 1,076 — 1,076 Total other expense, net 792 79 871 793 3 796 1,820 298 2,118 2,342 25 2,367 Net loss $ ( 683 ) $ ( 2 ) $ ( 685 ) $ ( 601 ) $ ( 724 ) $ ( 1,325 ) $ ( 1,637 ) $ ( 1,039 ) $ ( 2,676 ) $ ( 3,004 ) $ ( 1,248 ) $ ( 4,252 ) Total assets for the Real Estate Services segment and Healthcare Services segment were $ 57.5 million and $ 8.4 million , respectively, as of June 30, 2023. Total assets for the Real Estate Services segment and Healthcare Services segment were $ 63.5 million and $ 5.6 million , respectively, as of December 31, 2022 . |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 13. SUBSEQUENT EVENTS We evaluate subsequent events that occur after our consolidated balance sheet date but before our consolidated financial statements are issued. We have evaluated subsequent events occurring after June 30, 2023, and based on our evaluation have identified the subsequent events described below. Effective July 1, 2023, the Company signed a sublease for 2,000 sq ft of office space in Dunwoody, GA. The sublease expires on June 30, 2025 . On July 3, 2023, in connection with the closing of the Exchange Offer, the Company filed the Charter with the Secretary of State of the State of Georgia. For further information regarding the rights and privileges of the Series A Preferred Stock and the Series B Preferred Stock, see Note 9 – Common and Preferred Stock . On July 10, 2023, Plaintiff Sharon Hendricks filed suit against Tara Operator, LLC; ADK Georgia, LLC; Spring Valley, LLC; 3223 Falligant Avenue Associates, LP; Mansell Court Associates, LLC; and Wellington Healthcare Services II, LP alleging negligent care and treatment of Ms. Jones during her residence at Thunderbolt from July 12, 2021 through July 29, 2021. Specifically, Plaintiff’s claims relate to a fall Ms. Jones had on July 17, 2021 while at Thunderbolt. Plaintiff further alleges the Thunderbolt staff failed to administer medications as ordered, failed to initiate appropriate seizure protocols, and failed to properly update Ms. Jones’ care plan after the aforementioned fall. Plaintiff’s Complaint asserts the following causes of action: violation of 42 CFR 483.1; violation of OCGA 31-8-100; violation of federal and state statutes and regulations in the operation of a nursing home; professional negligence, ordinary negligence, negligent management and operation; breach of contract; failure to provide sufficient and properly trained staff; imputed liability; estate tort claims; joint enterprise; wrongful death; and punitive damages. Defendants are due to respond to this Complaint on or before September 11, 2023. On August 1, 2023, we received a letter (the “Acceptance Letter”) from the NYSE American LLC (“NYSE American”) notifying the Company that its plan of compliance (the “Plan)” to regain compliance with Sections 1003(a)(i) and 1003(a)(ii) of the NYSE American Company Guide had been accepted. The NYSE American has granted the Company a plan period through November 10, 2024 to regain compliance with the continued listing standards. On August 11, 2023, the Company and its former tenant, SL SNF, LLC, entered into a lease amendment (the “Amendment”) regarding the Southland facility. The amendment reduces the monthly rent to $ 43,000 effective April 1, 2023 and includes a $ 312,000 promissory note (the “Promissory Note”). The lease termination date under the amendment is October 31, 2024 . Under the terms of the Promissory Note, the principal sum plus all accrued interest, accruing on the unpaid principal balance at a rate of 8 % per annum, is due and payable on December 1, 2024, with minimum monthly payments of principal and interest of $ 18,353 .00 per month beginning on July 1, 2023. |
Organization and Significant _2
Organization and Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Description of Business | Description of Business Regional Health Properties, Inc.'s (the "Company" or "Regional Health") predecessor was incorporated in Ohio on August 14, 1991, under the name Passport Retirement, Inc. In 1995, Passport Retirement, Inc. acquired substantially all of the assets and liabilities of AdCare Health Systems, Inc. and changed its name to AdCare Health Systems, Inc. ("AdCare"). AdCare completed its initial public offering in November 2006, relocated its executive offices and accounting operations to Georgia in 2012, and changed its state of incorporation from Ohio to Georgia in December 2013. Regional Health Properties, Inc. is a self-managed real estate investment company that invests primarily in real estate purposed for long-term care and senior housing. Our business primarily consists of leasing such facilities to third-party tenants, which operate the facilities. The Company has two primary reporting segments: (i) Real Estate Services, which consists of the leasing and subleasing of long-term care and senior living facilities to third-party tenants, including the Company's management of three facilities on behalf of third-party owners; and (ii) Healthcare Services, which consists of the operation of the Meadowood and Glenvue facilities. Effective August 3, 2023, the Company’s 12.5 % Series B Cumulative Redeemable Preferred Shares (the “Series B Prefer red Stock”) is quoted on the OTC Markets Group, Inc.’s OTCQB Venture Market under the symbol “RHEPB”. |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements are prepared in conformity with U.S. generally accepted accounting principles ("GAAP") in accordance with the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC"). The accompanying consolidated financial statements are unaudited and should be read in conjunction with the 2022 audited consolidated financial statements and notes thereto, which are included in our 2022 Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC") on April 14, 2023 ("Annual Report"). In the opinion of management, the unaudited consolidated financial statements for the interim periods presented include all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the Company's financial position and the results of its operations and cash flows for such periods presented. The results of operations for such interim periods are not necessarily indicative of the results to be expected for the full year. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the unaudited consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. |
Reclassifications | Reclassifications Certain reclassifications have been made to the amounts in prior periods in order to conform to the current period's presentation. A reclassification has been made to the stock balances on the consolidated statement of stockholders’ equity in prior periods in order to conform to the current period's presentation. |
Principles of consolidations | Principles of Consolidations The consolidated financial statements include the Company's majority owned and controlled subsidiaries. All intercompany transactions and balances have been eliminated through consolidation |
Variable Interest Entities | Variable Interest Entities The Company has a loan receivable with Peach Health, a sublessee. Such agreement creates a variable interest in the Peach Health sublessee that may absorb some or all of the expected losses of the entity. The Company does not consolidate the operating activities of the Peach Health sublessee as the Company does not have the power to direct the activities that most significantly impact the entity's economic performance. |
Revenue Recognition and Allowances | Revenue Recognition and Allowances Patient Care Revenue. ASC Topic 606, Revenue from Contracts with Customers requires a company to recognize revenue when the company transfers control of promised goods and services to a customer. Revenue is recognized in an amount that reflects the consideration to which a company expects to receive in exchange for such goods and services. Revenue from our Healthcare Services business segment is derived from services rendered to patients in the Meadowood and Glenvue facilities. The Company receives payments from the following sources for services rendered in our facilities: (i) the federal government under the Medicare program administered by the U.S. Department of Health and Human Services Centers for Medicare and Medicaid Services ("CMS"); (ii) state governments under their respective Medicaid and similar programs; (iii) commercial insurers; and (iv) individual patients and clients. The vast majority of the revenue the Company recognizes is from government sources. The Company determines the transaction price based on established billing rates reduced by contractual adjustments provided to third-party payors, discounts provided to uninsured patients and other price concessions. Contractual adjustments and discounts are based on contractual agreements, discount policies and historical experience. The Company recognizes revenue at the amount that reflects the consideration the Company expects to receive in exchange for the services provided. These amounts are due from residents or third-party payors and include variable consideration for retroactive adjustments from estimated reimbursements, if any, under reimbursement programs. Performance obligations are determined based on the nature of the services provided. Revenue is recognized as performance obligations are satisfied. Estimated uncollectable amounts due from patients are generally considered implicit price concessions that are a direct reduction to net operating revenues. Triple-Net Leased Properties. The Company recognizes rental revenue in accordance with ASC 842, Leases . The Company's triple-net leases provide for periodic and determinable increases in rent. The Company recognizes rental revenues under these leases on a straight-line basis over the applicable lease term when collectability is probable. Recognizing rental income on a straight-line basis generally results in recognized revenues during the first half of a lease term exceeding the cash amounts contractually due from our tenants, creating a straight-line rent receivable that is included in the straight-line rent receivable on our consolidated balance sheets. In the event the Company cannot reasonably estimate the future collection of rent from one or more tenant(s) of the Company's facilities, rental income for the affected facilities is recognized only upon cash collection, and any accumulated straight-line rent receivable is expensed in the period in which the Company deems rent collection to no longer be probable. Management Fee Revenues and Other Revenues . The Company recognizes management fee revenues as services are provided. The Company has one contract to manage three facilities (the "Management Contract"), with payment for each month of service generally received in full on a monthly basis. The maximum penalty for service contract nonperformance under the Management Contract is $ 50,000 per year, payable after the end of the year. Further, the Company recognizes interest income from loans and investments, using the effective interest method when collectability is probable. The Company applies the effective interest method on a loan-by-loan basis. On June 30, 2023, the Company received a notice of termination, pursuant to which the Management Contract will terminate on December 31, 2023. Allowances. The Company assesses the collectability of its rent receivables, including straight-line rent receivables, working capital loans to tenants and patient reimbursement. The Company bases its assessment of the collectability of rent receivables and working capital loans to tenants on several factors, including payment history, the financial strength of the tenant and any guarantors, the value of the underlying collateral, and current economic conditions. If the Company's evaluation of these factors indicates it is probable that the Company will be unable to receive the rent payments or payments on a working capital loan, then the Company provides a reserve against the recognized straight-line rent receivable asset or working capital loan for the portion that we estimate may not be recovered. Payments received on impaired loans are applied against the allowance. If the Company changes its assumptions or estimates regarding the collectability of future rent payments, then the Company may adjust its reserve to the rental or interest revenue recognized in the period the Company makes such change. See Note 6 – Leases. Regarding patient reimbursements, the Company assesses the patient receivable based on payor type and age of the receivable amongst several other factors. The Company has reserved for approximately 1.5 % o f our patient care revenue based on the historical performance and industry practices. As of June 30, 2023 and December 31, 2022, the Company reserved for approximately $ 1.4 million and $ 1.3 million , respectively, of uncollected receivables. Accounts receivable, net of allowance, totaled $ 3.0 million at June 30, 2023 and $ 6.3 million at December 31, 2022. The following table presents the Company's Accounts receivable, net of allowance for the periods presented: (Amounts in 000’s) June 30, 2023 December 31, 2022 Gross receivables Real Estate Services $ 1,143 $ 1,094 Healthcare Services 3,280 6,493 Subtotal 4,423 7,587 Allowance Real Estate Services ( 338 ) ( 338 ) Healthcare Services ( 1,062 ) ( 960 ) Subtotal ( 1,400 ) ( 1,298 ) Accounts receivable, net of allowance $ 3,023 $ 6,289 |
Prepaid Expenses and Other | Prepaid Expenses and Other As of June 30, 2023 and December 31, 2022, the Company had approximately $ 1.2 million and $ 0.7 million , respectively, in prepaid expenses and other; the $ 0.5 million increase is related to insurance for the Meadowood and Glenvue facility operations, while the other amounts are predominantly for directors' and officers' insurance, NYSE American annual fees, and mortgage insurance premiums. |
Accounts Payable | Accounts Payable The following table presents the Company's Accounts payable for the periods presented: (Amounts in 000’s) June 30, 2023 December 31, 2022 Accounts payable Real Estate Services $ 1,247 $ 797 Healthcare Services 1,789 2,496 Total Accounts payable $ 3,036 $ 3,293 |
Other Expense, Net | Other Expense, net The Company retained a law firm to evaluate and assist with possible opportunities to improve the Company's capital structure. For the six months ended June 30, 2023 and June 30, 2022 , these costs were $ 0.5 million and $ 0.9 million, respectively. |
Leases and Leasehold Improvements | Leases and Leasehold Improvements The Company leases certain facilities and equipment in the normal course of business. At the inception of each lease, the Company performs an evaluation to determine whether the lease should be classified as an operating lease or finance lease. As of June 30, 2023, all of the Company's leased facilities are accounted for as operating leases. For operating leases that contain scheduled rent increases, the Company records rent expense on a straight-line basis over the term of the lease. Leasehold improvements are amortized over the shorter of the useful life of the asset or the lease term. The Company recognizes both right of use assets and lease liabilities for leases in which we lease land, real property, or other equipment. We assess any new contracts or modification of contracts in accordance with ASC 842, Leases to determine the existence of a lease and its classification. We report revenues and expenses for real estate taxes and insurance where the lessee has not made those payments directly to a third-party in accordance with its respective leases with us. Additionally, we expense certain leasing costs, other than leasing commissions, as they are incurred. The present value of minimum lease payments was calculated on each lease, using a discount rate of 3.85 % that approximated our incremental borrowing rate and the current lease term. See Note 6– Leases for more information on the Company's operating leases. |
Insurance | Insurance We maintain general liability, professional liability, and other insurance policies in amounts and with coverage and deductibles we believe are appropriate, based on the nature and risks of our business, historical experience, availability, and industry standards, including for the operations at the Glenvue and Meadowood facilities. Our current policies provide for deductibles for each claim and contain various exclusions from coverage. The Company has self-insured against professional and general liability claims related to its healthcare operations that were discontinued during 2014 and 2015 in connection with its transition from an owner and operator of healthcare properties to a healthcare property holding and leasing company (the "Transition"). For further information, see Note 11 – Commitments and Contingencies , and Note 13 – Commitments and Contingencies, to the consolidated financial statements for the year ended December 31, 2022 for more information. The Company evaluates quarterly the adequacy of its self-insurance reserve based on a number of factors, including: (i) the number of actions pending and the relief sought; (ii) analyses provided by defense counsel, medical experts or other information which comes to light during discovery; (iii) the legal fees and other expenses anticipated to be incurred in defending the actions; (iv) the status and likely success of any mediation or settlement discussions, including estimated settlement amounts and legal fees and other expenses anticipated to be incurred in such settlement, as applicable; and (v) the venues in which the actions have been filed or will be adjudicated. The Company believes that most of the professional and general liability actions are defensible and intends to defend them through final judgment unless settlement is more advantageous to the Company. Accordingly, the self-insurance reserve reflects the Company's estimate of settlement amounts for the pending actions, if applicable, and legal costs of settling or litigating the pending actions, as applicable. Because the self-insurance reserve is based on estimates, the amount of the self-insurance reserve may not be sufficient to cover the settlement amounts actually incurred in settling the pending actions, or the legal costs actually incurred in settling or litigating the pending actions. See Note 7 – Accrued Expenses . In addition, the Company maintains certain other insurance programs, including commercial general liability, property, casualty, directors' and officers' liability, crime, and employment practices liability. |
Discontinued Operations | Discontinued Operations Prior to December 2015, the Company’s business focused primarily on owning and operating skilled nursing facilities ("SNF") and managing such facilities for unaffiliated owners with whom the Company had management contracts. These operations were discontinued and transitioned to the leasing model of business. As of June 30, 2023 and December 21, 2022 the Company determined remaining escheatment liabilities for discontinued operations are $ 0.8 million and are included in accrued expenses. |
Net Loss Per Share | Net Loss Per Share Basic net loss per share is computed by dividing net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding during the respective period. Diluted earnings per share is similar to basic net loss per share except that the net loss is adjusted by the impact of the weighted-average number of shares of common stock outstanding including potentially dilutive securities (such as options, warrants and non-vested common stock) when such securities are not anti-dilutive. Potentially dilutive securities from options, warrants and unvested restricted shares are calculated in accordance with the treasury stock method, which assumes that proceeds from the exercise of all options and warrants with exercise prices exceeding the average market value are used to repurchase common stock at market value. The incremental shares remaining after the proceeds are exhausted represent the potentially dilutive effect of the securities. Securities outstanding that were excluded from the computation, because they would have been anti-dilutive were as follows: June 30, (Share amounts in 000’s) 2023 2022 Stock options 13 13 Warrants - employee 32 34 Warrants - non employee 1 5 Total anti-dilutive securities 46 52 The weighted average contractual terms in years for these securities as of June 30, 2023 , with no intrinsic value, are 0.4 years for the stock options and 1.5 years for the warrants. |
New Accounting Pronouncements Issued But Not Yet Effective | New Accounting Pronouncements Issued But Not Yet Effective In March 2023, the FASB issued ASU 2023-01, Leases (Topic 842): Common Control Arrangements (Topic 842) amendments, which requires entities to determine whether related party arrangements between entities under common control are leases. The amendments also address the accounting treatment of leasehold improvements associated with common control leases. They require the lessee to amortize leasehold improvements over the useful life of the improvements to the common control group, regardless of the lease term, as long as the lessee controls the use of the underlying asset. If the lessee no longer controls the use of the asset, the leasehold improvements are accounted for as a transfer between entities under common control through an adjustment to equity. These improvements are also subject to impairment guidance in Topic 360, Property, Plant, and Equipment. The amendment is effective for public entities beginning after December 15, 2023. The Company is currently evaluating the impact of ASU 2023-01 on its financial statements. No other new accounting pronouncement issued or effective has had, or is expected to have, a material impact on the Company's financial statements. |
Organization and Significant _3
Organization and Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Company's Accounts Receivable, Net of Allowance | The following table presents the Company's Accounts receivable, net of allowance for the periods presented: (Amounts in 000’s) June 30, 2023 December 31, 2022 Gross receivables Real Estate Services $ 1,143 $ 1,094 Healthcare Services 3,280 6,493 Subtotal 4,423 7,587 Allowance Real Estate Services ( 338 ) ( 338 ) Healthcare Services ( 1,062 ) ( 960 ) Subtotal ( 1,400 ) ( 1,298 ) Accounts receivable, net of allowance $ 3,023 $ 6,289 |
Company's Accounts Payable | The following table presents the Company's Accounts payable for the periods presented: (Amounts in 000’s) June 30, 2023 December 31, 2022 Accounts payable Real Estate Services $ 1,247 $ 797 Healthcare Services 1,789 2,496 Total Accounts payable $ 3,036 $ 3,293 |
Schedule of Securities Outstanding that were Excluded From the Computation, Prior to the Use of the Treasury Stock Method, Because They Would Have Been Anti-dilutive | Securities outstanding that were excluded from the computation, because they would have been anti-dilutive were as follows: June 30, (Share amounts in 000’s) 2023 2022 Stock options 13 13 Warrants - employee 32 34 Warrants - non employee 1 5 Total anti-dilutive securities 46 52 |
Liquidity (Tables)
Liquidity (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Liquidity [Abstract] | |
Summary of Lease Terminations | The table below summarizes the lease terminations related to existing properties as of June 30, 2023 since the onset of the COVID-19 pandemic and the Company’s resulting portfolio stabilization measures: Date Facility Name Former Operator Current Operator April 2022 Meadowood C.R. Management Regional Health (managed by Cavalier Senior Living Operations) August 2022 Glenvue C.R. Management Regional Health |
Cash and Restricted Cash (Table
Cash and Restricted Cash (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Restricted Cash and Investments [Abstract] | |
Schedule of Cash and Restricted Cash | The following presents the Company's cash and restricted cash: (Amounts in 000’s) June 30, 2023 December 31, 2022 Cash $ 1,926 $ 843 Restricted cash: Cash collateral $ 76 $ 135 HUD and other replacement reserves 2,094 2,155 Escrow deposits 452 459 Restricted investments for debt obligations 317 317 Total restricted cash 2,939 3,066 Total cash and restricted cash $ 4,865 $ 3,909 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | The following table sets forth the Company's property and equipment: (Amounts in 000’s) Estimated June 30, 2023 December 31, 2022 Buildings and improvements 5 - 40 $ 64,376 $ 63,746 Equipment and computer related 2 - 10 1,677 1,807 Land (1) — 2,774 2,774 Property and equipment 68,827 68,327 Less: accumulated depreciation and amortization ( 22,561 ) ( 21,716 ) Property and equipment, net $ 46,266 $ 46,611 (1) Includes $ 0.1 million of land improvements with an average estimated useful remaining life of approximately 5.5 years. The following table summarizes total depreciation and amortization expense three and six and months ended June 30, 2023 and 2022: Three Months Ended June 30, Six Months Ended June 30, (Amounts in 000’s) 2023 2022 2023 2022 Depreciation $ 593 $ 496 $ 993 $ 1,000 Amortization 109 110 219 219 Total depreciation and amortization expense $ 702 $ 606 $ 1,212 $ 1,219 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets and Goodwill | Intangible assets and Goodwill consist of the following: (Amounts in 000’s) Bed licenses Bed Licenses - Lease Total Goodwill (2) Balances, December 31, 2022 Gross $ 14,276 $ 2,471 $ 206 $ 16,953 $ 1,585 Accumulated amortization ( 4,583 ) — ( 96 ) ( 4,678 ) — Net carrying amount $ 9,693 $ 2,471 $ 110 $ 12,275 $ 1,585 Balances, June 30, 2023 Gross 14,276 2,471 206 16,953 1,585 Accumulated amortization ( 4,790 ) — ( 108 ) ( 4,898 ) — Net carrying amount $ 9,486 $ 2,471 $ 98 $ 12,055 $ 1,585 (1) Non-separable bed licenses are included in property and equipment as is the related accumulated amortization expense (see Note 4 – Property and Equipment ). (2) The Company does not amortize indefinite-lived intangibles, which consist of separable bed licenses and goodwill . |
Schedule of Total Amortization Expense | The following table summarizes amortization expense for the three and six and months ended June 30, 2023 and 2022: Three Months Ended June 30, Six Months Ended June 30, (Amounts in 000’s) 2023 2022 2023 2022 Bed licenses $ 103 $ 104 $ 207 $ 207 Lease rights 6 6 12 12 Total amortization expense $ 109 $ 110 $ 219 $ 219 |
Schedule of Estimated Amortization Expense for All Definite Lived Intangibles | Expected amortization expense for the years ending December 31, for all definite-lived intangibles, for each of the next five years and thereafter is as follows: (Amounts in 000’s) Bed Lease 2023 (6 months remaining) $ 207 $ 12 2024 414 24 2025 414 24 2026 414 24 2027 414 14 Thereafter 7,623 - Total expected amortization expense $ 9,486 $ 98 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Leases [Abstract] | |
Schedule of Future Minimum Lease Payments | Future minimum lease payments for the twelve months ending December 31, for each of the next five years and thereafter is as follows: (Amounts in 000’s) Future Accretion of Operating 2023 (6 months remaining) $ 312 $ ( 7 ) $ 305 2024 633 ( 50 ) 582 2025 645 ( 97 ) 549 2026 658 ( 141 ) 517 2027 671 ( 184 ) 487 Thereafter 914 ( 310 ) 604 Total $ 3,833 $ ( 789 ) $ 3,044 (1) Weighted a verage discount rate 3.85 %. |
Schedule of Future Minimum Lease Receivables | Future minimum lease receivables for the twelve months ending December 31, for each of the next five years and thereafter is as follows: (Amounts 2023 (6 months remaining) $ 3,139 2024 6,187 2025 6,034 2026 5,362 2027 5,445 Thereafter 11,605 Total $ 37,772 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses | Accrued expenses consist of the following: (Amounts in 000’s) June 30, 2023 December 31, Accrued employee benefits and payroll-related $ 356 $ 539 Real estate and other taxes (1) 2,667 2,428 Self-insured reserve 65 80 Accrued interest 223 210 Unearned rental revenue - 43 Medicaid overpayment - Healthcare Services 52 169 Insurance escrow 55 — Other accrued expenses 1,414 1,567 Total accrued expenses $ 4,832 $ 5,036 (1) June 30, 2023 includes approximately $ 2.3 million of franchise tax accruals for the Healthcare Services segment. December 31, 2022 includes approximately $ 2.2 million of franchise tax accruals for the Healthcare Services segment. |
Notes Payable and Other Debt (T
Notes Payable and Other Debt (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Notes Payable and Other Debt | Notes payable and other debt consists of the following: (Amounts in 000’s) June 30, 2023 December 31, Senior debt—guaranteed by HUD $ 29,384 $ 29,782 Senior debt—guaranteed by USDA (1) 7,403 7,526 Senior debt—guaranteed by SBA(2) 567 580 Senior debt—bonds 6,117 6,253 Senior debt—other mortgage indebtedness 8,175 8,266 Other debt 1,490 895 Subtotal 53,136 53,302 Deferred financing costs ( 988 ) ( 1,005 ) Unamortized discount on bonds ( 116 ) ( 119 ) Notes payable and other debt $ 52,032 $ 52,178 (1) U.S. Department of Agriculture ("USDA") (2) U.S. Small Business Administration ("SBA") The following is a detailed listing of the debt facilities that comprise each of the above categories: (Amounts in 000’s) Facility Lender Maturity Interest Rate (1) June 30, 2023 December 31, Senior debt - guaranteed by HUD (2) The Pavilion Care Center Newpoint Capital 12/01/2039 Fixed 3.97 % $ 819 $ 835 Hearth and Care of Greenfield Newpoint Capital 8/01/2050 Fixed 3.97 % 1,929 1,949 Woodland Manor Newpoint Capital 11/01/2052 Fixed 3.97 % 4,936 4,980 Glenvue Newpoint Capital 10/01/2044 Fixed 3.75 % 7,189 7,297 Autumn Breeze KeyBank 01/01/2045 Fixed 3.65 % 6,250 6,344 Georgetown Newpoint Capital 10/01/2046 Fixed 2.98 % 3,167 3,214 Sumter Valley KeyBank 01/01/2047 Fixed 3.70 % 5,095 5,163 Total $ 29,385 $ 29,782 Senior debt - guaranteed by USDA (3) Mountain Trace (4) Community B&T 12/24/2036 Prime + 1.75 % 9.25 % $ 3,610 $ 3,680 Southland (5) Cadence Bank, NA 07/27/2036 Prime + 1.50 % 9.00 % 3,793 3,846 Total $ 7,403 $ 7,526 Senior debt - guaranteed by SBA Southland(6) Cadence Bank, NA 07/27/2036 Prime + 2.25 % 9.75 % $ 567 $ 580 Total $ 567 $ 580 (1) Represents cash interest rates as of June 30, 2023 as adjusted for interest rate floor limitations, if applicable. The rates exclude amortization of deferred financing costs, which range from 0.09 % to 0.53 % per annum. (2) For the seven SNFs, the Company has term loans with financial institutions that are insured 100 % by HUD. The loans are secured by, among other things, an assignment of all rents paid under any existing or future leases and rental agreements with respect to the underlying facility. The loans contain customary events of default, including fraud or material misrepresentations or material omission, the commencement of a forfeiture action or proceeding, failure to make required payments, and failure to perform or comply with certain agreements. Upon the occurrence of certain events of default, the lenders may, after receiving the prior written approval of HUD, terminate the loans and all amounts under the loans will become immediately due and payable. In connection with entering into each loan, the Company entered into a healthcare regulatory agreement and a promissory note, each containing customary terms and conditions. Pursuant to the CARES Act, up to three months of debt service payments for six of the credit facilities can be made from our restricted cash reserves. (3) For the two SNFs, the Company has term loans with financial institutions that are insured 70 % to 80 % by the USDA. The loans have an annual renewal fee for the USDA guarantee of 0.25 % of the guaranteed portion. The loans had prepayment penalties of 1 %, capped at 1 % for the remainder of the first 10 years of the term and 0 % thereafter. (4) Pursuant to the CARES Act, the monthly principal and interest payments due May 1, 2020 through August 1, 2020 for the Mountain Trace Facility loan were deferred. Monthly payments that commenced on September 1, 2020 were being applied to current interest, then deferred interest until the deferred interest was paid in full on April 1, 2021. Payments have been re-amortized over the extended term of the loan. (5) Pursuant to the CARES Act, the monthly principal and interest payments due May 1, 2020 through October 1, 2020 for the loan for that certain 126 -bed SNF commonly known as Southland, located in Dublin, Georgia, were deferred as a part of the USDA Payment Program. Monthly payments recommenced on November 1, 2020 with payments through February 2021 being applied to principal and interest. Monthly payments that commenced on March 1, 2021 are being applied to current interest, then deferred interest until the deferred interest is paid in full, payments will be re-amortized over the extended term of the loan. (6) For the one SNF, commonly known as Southland, the Company has a term loan with a financial institution, which is 75 % insured by the SBA. The SBA funded two monthly debt payments during the three months ended March 31, 2021 and six payments commencing on March 1, 2020 and ending on August 1, 2020. (Amounts in 000’s) Facility Lender Maturity Interest Rate (1) June 30, 2023 December 31, 2022 Senior debt - bonds Eaglewood Bonds Series A City of Springfield, Ohio 05/01/2042 Fixed 7.65 % $ 6,117 $ 6,253 (1) Represents cash interest rates as of June 30, 2023. The rates exclude amortization of deferred financing of approximately 0.1 % per an num. (Amounts in 000’s) Facility Lender Maturity Interest Rate (1) June 30, 2023 December 31, Senior debt - other mortgage indebtedness Meadowood (2) Exchange Bank of Alabama 10/01/2026 Fixed 4.50 % $ 3,319 $ 3,319 Coosa (3) Exchange Bank of Alabama 10/10/2026 Fixed 3.95 % 4,856 4,946 Total $ 8,175 $ 8,266 (1) Represents cash interest rates as of June 30, 2023 as adjusted for interest rate floor limitations, if applicable. The rates exclude amortization of deferred financing costs of 0.34 % per annum. (2) On October 1, 2021, the Exchange Bank of Alabama and the Company extended the maturity date of the Meadowood Credit Facility which is secured by the Meadowood Facility and the assets of Coosa, and which is guaranteed by Regional Health Properties, Inc., from May 1, 2022 to October 1, 2026 . (3) On September 30, 2021, the Company refinanced the MCB Coosa Loan secured by the Coosa Facility, incurring approximately $ 0.1 million in new fees. The Coosa Credit Facility, guaranteed by Regional Health Properties, Inc. includes customary terms, including events of default with an associated annual 5 % default interest rate, and is secured by the Coosa Facility and the assets of Meadowood. Upon the occurrence of certain events of default, the lenders may terminate the Coosa Credit Facility and the Meadowood Credit Facility and all amounts due under both credit facilities will become immediately due and payable. The Coosa Credit Facility has prepayment penalties of 5 % in the first year, 4 % in the second year and 1 % thereafter. (Amounts in 000’s) Lender Maturity Interest Rate June 30, 2023 December 31, Other debt First Insurance Funding (1) Various 2023 Fixed 3.19 % $ 962 $ 357 Key Bank (2) 08/25/2025 Fixed 0.00 % 495 495 Marlin Capital Solutions 06/1/2027 Fixed 5.00 % 33 43 Total $ 1,490 $ 895 (1) Annual Insurance financing primarily for the Company's directors and officers insurance and professional liability for the facilities where the company is the licensed operator. (2) On December 30, 2022, Key Bank and the Company extended the maturity date from August 25, 2023 to August 25, 2025 . |
Summary of the Scheduled Maturities | The schedule below summarizes the scheduled gross maturities as of June 30, 2023 for each of the next five years and thereafter. For the Twelve Months Ended December 31, (Amounts in 000’s) 2023 (6 months remaining) $ 1,263 2024 1,966 2025 2,157 2026 8,622 2027 1,421 Thereafter 37,707 Subtotal $ 53,136 Less: unamortized discounts ( 116 ) Less: deferred financing costs, net ( 988 ) Total notes and other debt $ 52,032 |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Summary of Recognized Stock Based Compensation | For the three and six and months ended June 30, 2023 and 2022, the Company recognized stock-based compensation expense as follows: Three Months Ended June 30, Six Months Ended June 30, (Amounts in 000’s) 2023 2022 2023 2022 Employee compensation: Stock compensation expense $ 155 $ 58 $ 236 $ 169 Forfeitures of stock based awards — ( 54 ) — ( 54 ) Total employee stock-based compensation expense $ 155 $ 4 $ 236 $ 115 |
Summary of Company's Restricted Stock Activity | The following table summarizes the Company's restricted stock activity for the six months ended June 30, 2023: Number of Weighted Avg. Unvested, December 31, 2022 51 $ 8.99 Granted 99 $ 3.61 Vested ( 26 ) $ 9.06 Unvested, June 30, 2023 124 $ 4.68 |
Summary of Company's Stock Option Activity | The following summarizes the Company's employee and non-employee stock option activity for the six months ended June 30, 2023: Number of Weighted Weighted Aggregate Outstanding, December 31, 2022 13 $ 47.53 0.5 $ — Granted 24 $ 3.32 9.5 $ — Outstanding and Vested, June 30, 2023 37 $ 18.63 6.6 $ 6.7 |
Schedule of Exercise Price Range | The following summary information reflects stock options outstanding, vested, and related details as of June 30, 2023: Stock Options Outstanding Stock Options Exercisable Exercise Price Number of Weighted Weighted Vested, June 30, 2023 Weighted $ 3.32 24 9.5 $ 3.32 24 $ 3.32 $ 46.80 - $ 48.72 13 0.4 $ 47.42 13 $ 47.42 Total 37 6.6 $ 18.63 37 $ 18.63 |
Warrants | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Schedule of Common Stock Warrant Activity | The following summarizes the Company's employee and non-employee common stock warrant activity for the six months ended June 30, 2023: Outstanding and Exercisable Number of Weighted Weighted Outstanding and Vested, December 31, 2022 35 $ 53.31 1.9 Expired ( 2 ) $ 70.80 — Outstanding and Vested, June 30, 2023 33 $ 52.38 1.5 |
Segments Results (Tables)
Segments Results (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Segment Reporting [Abstract] | |
Summary of Results of Operations for Reporting Segments | The table below presents the results of operations for our reporting segments for the periods presented. Three Months Ended June 30, Three Months Ended June 30, Six Months Ended June 30, Six Months Ended June 30, 2023 2023 2023 2022 2022 2022 2023 2023 2023 2022 2022 2022 (Amounts in 000’s) Real Estate Services Healthcare Services Total Real Estate Services Healthcare Services Total Real Estate Services Healthcare Services Total Real Estate Services Healthcare Services Total Revenues: Patient care revenues $ — $ 2,526 $ 2,526 $ — $ 4,570 $ 4,570 $ — $ 4,442 $ 4,442 $ — $ 6,881 $ 6,881 Rental revenues 1,722 — 1,722 3,261 — 3,261 3,430 — 3,430 7,326 — 7,326 Management fees 247 — 247 255 — 255 525 — 525 519 — 519 Other revenues 103 — 103 7 — 7 107 — 107 14 — 14 Total revenues 2,072 2,526 4,598 3,523 4,570 8,093 4,062 4,442 8,504 7,859 6,881 14,740 Expenses: Patient care expense — 2,159 2,159 — 4,222 4,222 — 4,697 4,697 — 6,564 6,564 Facility rent expense 149 — 149 1,106 528 1,634 297 — 297 2,448 826 3,274 Cost of management fees 146 — 146 144 — 144 286 — 286 319 — 319 Depreciation and amortization 599 103 702 599 7 606 1,106 106 1,212 1,206 13 1,219 General and administrative expense 978 33 1,011 679 242 921 2,020 197 2,217 1,685 369 2,054 Doubtful accounts expense — 24 24 466 — 466 — 40 40 2,227 — 2,227 Other operating expenses 91 130 221 337 292 629 170 143 313 636 332 968 Total expenses 1,963 2,449 4,412 3,331 5,291 8,622 3,879 5,183 9,062 8,521 8,104 16,625 Income (loss) from operations 109 77 186 192 ( 721 ) ( 529 ) 183 ( 741 ) ( 558 ) ( 662 ) ( 1,223 ) ( 1,885 ) Other expense: Interest expense, net 601 78 679 636 3 639 1,279 80 1,359 1,266 25 1,291 Other expense, net 191 1 192 157 — 157 541 218 759 1,076 — 1,076 Total other expense, net 792 79 871 793 3 796 1,820 298 2,118 2,342 25 2,367 Net loss $ ( 683 ) $ ( 2 ) $ ( 685 ) $ ( 601 ) $ ( 724 ) $ ( 1,325 ) $ ( 1,637 ) $ ( 1,039 ) $ ( 2,676 ) $ ( 3,004 ) $ ( 1,248 ) $ ( 4,252 ) |
Organization and Significant _4
Organization and Significant Accounting Policies - Additional Information (Details) | 6 Months Ended | |||
Aug. 03, 2023 | Jun. 30, 2023 USD ($) Segment | Jun. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Finite Lived Intangible Assets [Line Items] | ||||
Maximum penalty for service contract nonperformance | $ 50,000 | |||
Percentage of reserve for patient care revenue | 1.50% | |||
Number of primary reporting segments | Segment | 2 | |||
Receivables, estimated allowance for uncollectible accounts | $ 1,400,000 | $ 1,298,000 | ||
Accounts receivable, net of allowance | 3,023,000 | 6,289,000 | ||
Prepaid expenses and other | 1,200,000 | 700,000 | ||
Other expense, net | 500,000 | $ 900,000 | ||
Decrease in Prepaid expenses and other | 500,000 | |||
Other liabilities | $ 1,635,000 | 1,131,000 | ||
Weighted average discount rate | 3.85% | |||
Intrinsic Value | $ 0 | |||
Number of reportable segments | Segment | 2 | |||
Accrued Expenses | ||||
Finite Lived Intangible Assets [Line Items] | ||||
Escheatment liabilities | $ 800,000 | 800,000 | ||
Stock options | ||||
Finite Lived Intangible Assets [Line Items] | ||||
Weighted average contractual terms | 4 months 24 days | |||
Warrants | ||||
Finite Lived Intangible Assets [Line Items] | ||||
Weighted average contractual terms | 1 year 6 months | |||
Wellington Lease Termination | ||||
Finite Lived Intangible Assets [Line Items] | ||||
Receivables, estimated allowance for uncollectible accounts | $ 1,400,000 | $ 1,300,000 | ||
Series B Cumulative Redeemable Preferred Shares | Subsequent Event | ||||
Finite Lived Intangible Assets [Line Items] | ||||
Preferred stock, fixed interest rate (percentage) | 12.50% |
Organization and Significant _5
Organization and Significant Accounting Policies - Company's Accounts Receivable, Net of Allowance (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Accounts Notes And Loans Receivable [Line Items] | ||
Gross receivables | $ 4,423 | $ 7,587 |
Allowance | (1,400) | (1,298) |
Accounts receivable, net of allowance | 3,023 | 6,289 |
Real Estate Services | ||
Accounts Notes And Loans Receivable [Line Items] | ||
Gross receivables | 1,143 | 1,094 |
Allowance | (338) | (338) |
Healthcare Services | ||
Accounts Notes And Loans Receivable [Line Items] | ||
Gross receivables | 3,280 | 6,493 |
Allowance | $ (1,062) | $ (960) |
Organization and Significant _6
Organization and Significant Accounting Policies - Company's Accounts Payable (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Accounts Payable [Line Items] | ||
Accounts payable | $ 3,036 | $ 3,293 |
Real Estate Services | ||
Accounts Payable [Line Items] | ||
Accounts payable | 1,247 | 797 |
Healthcare Services | ||
Accounts Payable [Line Items] | ||
Accounts payable | $ 1,789 | $ 2,496 |
Organization and Significant _7
Organization and Significant Accounting Policies - Anti-dilutive Securities (Details) - shares shares in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Anti-dilutive securities outstanding that were excluded from the computation | ||
Antidilutive securities | 46 | 52 |
Stock options | ||
Anti-dilutive securities outstanding that were excluded from the computation | ||
Antidilutive securities | 13 | 13 |
Warrants - employee | ||
Anti-dilutive securities outstanding that were excluded from the computation | ||
Antidilutive securities | 32 | 34 |
Warrants - non employee | ||
Anti-dilutive securities outstanding that were excluded from the computation | ||
Antidilutive securities | 1 | 5 |
Liquidity - Additional Informat
Liquidity - Additional Information (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||||||
Oct. 21, 2022 | Aug. 17, 2021 | Aug. 16, 2021 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | Aug. 11, 2023 | Dec. 30, 2022 | |
Management's plan for increasing liquidity | ||||||||
Unrestricted cash | $ 1,900 | |||||||
Cash flow from operations | 2,955 | $ (2,798) | ||||||
Total indebtedness | 52,032 | |||||||
Net of deferred financing costs and unamortized discounts, in indebtedness | 1,100 | |||||||
Debt repayments of principal in next 12 months, amortization | 2,500 | |||||||
Prepayment penalty | 17 | |||||||
Deferred financing fees | 1,100 | |||||||
Accounts payable | 3,036 | $ 3,293 | ||||||
Accumulated and unpaid dividends on series A preferred stock | 50,400 | |||||||
Healthcare Services [Member] | ||||||||
Management's plan for increasing liquidity | ||||||||
Accounts Receivable | 2,200 | |||||||
Accounts payable | 1,789 | 2,496 | ||||||
Accounts payable | 1,800 | |||||||
Key Bank Exit Notes | ||||||||
Management's plan for increasing liquidity | ||||||||
Debt instrument | $ 500 | |||||||
Maturity date | Aug. 25, 2025 | Aug. 25, 2023 | ||||||
Routine debt | ||||||||
Management's plan for increasing liquidity | ||||||||
Debt repayments of principal in next 12 months, amortization | 1,400 | |||||||
Insurance Financing Amortization | ||||||||
Management's plan for increasing liquidity | ||||||||
Debt repayments of principal in next 12 months, amortization | 1,000 | |||||||
Bond Debt | ||||||||
Management's plan for increasing liquidity | ||||||||
Debt repayments of principal in next 12 months, amortization | $ 100 | |||||||
Promissory Note | Subsequent Event | ||||||||
Management's plan for increasing liquidity | ||||||||
Interest rate | 8% | |||||||
HUD Notes | ||||||||
Management's plan for increasing liquidity | ||||||||
Net of deferred financing costs and unamortized discounts, in indebtedness | 200 | |||||||
Debt instrument | $ 7,600 | |||||||
Interest rate | 3.97% | |||||||
Net loss on extinguishment of debt | 400 | |||||||
Prepayment penalty | 200 | |||||||
Deferred financing fees | $ 200 | |||||||
HUD Notes | Northwood HUD Note | ||||||||
Management's plan for increasing liquidity | ||||||||
Debt instrument | $ 4,900 | |||||||
Maturity date | Nov. 01, 2052 | |||||||
HUD Notes | Greenfield HUD Note | ||||||||
Management's plan for increasing liquidity | ||||||||
Debt instrument | $ 1,900 | |||||||
Maturity date | Nov. 01, 2050 | |||||||
HUD Notes | Pavilion HUD Note | ||||||||
Management's plan for increasing liquidity | ||||||||
Debt instrument | $ 800 | |||||||
Maturity date | Dec. 01, 2039 |
Liquidity - Summary of Lease Te
Liquidity - Summary of Lease Terminations (Details) | 6 Months Ended |
Jun. 30, 2023 | |
Meadowood | |
Liquidity [Line Items] | |
Date | 2022-04 |
Former Operator | C.R. Management |
Current Operator | Regional Health (managed by Cavalier Senior Living Operations) |
Glenvue | |
Liquidity [Line Items] | |
Date | 2022-08 |
Former Operator | C.R. Management |
Current Operator | Regional Health |
Cash and Restricted Cash - Sche
Cash and Restricted Cash - Schedule of Cash and Restricted Cash (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2021 |
Restricted Cash And Investments [Line Items] | ||||
Cash | $ 1,926 | $ 843 | ||
Restricted cash: | ||||
HUD and other replacement reserves | 2,094 | 2,155 | ||
Escrow deposits | 452 | 459 | ||
Restricted investments for debt obligations | 317 | 317 | ||
Total restricted cash | 2,939 | 3,066 | ||
Total cash and restricted cash | 4,865 | 3,909 | $ 5,524 | $ 9,848 |
Asset Pledged as Collateral without Right | ||||
Restricted cash: | ||||
Cash collateral | $ 76 | $ 135 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 68,827 | $ 68,327 |
Less: accumulated depreciation and amortization | (22,561) | (21,716) |
Property and equipment, net | 46,266 | 46,611 |
Buildings and Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 64,376 | 63,746 |
Buildings and Improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful lives | 5 years | |
Buildings and Improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful lives | 40 years | |
Equipment and Computer Related | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 1,677 | 1,807 |
Equipment and Computer Related | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful lives | 2 years | |
Equipment and Computer Related | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful lives | 10 years | |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 2,774 | $ 2,774 |
Property and Equipment - Sche_2
Property and Equipment - Schedule of Property and Equipment (Parenthetical) (Details) $ in Millions | Jun. 30, 2023 USD ($) |
Property, Plant and Equipment [Line Items] | |
Land improvements | $ 0.1 |
Land Improvements | |
Property, Plant and Equipment [Line Items] | |
Useful lives | 5 years 6 months |
Property and Equipment - Sche_3
Property and Equipment - Schedule of Total Depreciation and Amortization Expense of Property and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation | $ 593 | $ 496 | $ 993 | $ 1,000 |
Amortization | 109 | 110 | 219 | 219 |
Total depreciation and amortization expense | $ 702 | $ 606 | $ 1,212 | $ 1,219 |
Intangible Assets and Goodwil_2
Intangible Assets and Goodwill - Schedule of Intangible Assets and Goodwill (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 | |
Intangible assets net excluding goodwill | |||
Finite and indefinite lived intangible assets, gross | $ 16,953 | $ 16,953 | |
Finite and indefinite lived intangible assets, accumulated amortization | (4,898) | (4,678) | |
Intangible assets, net carrying amount | 12,055 | 12,275 | |
Goodwill Roll Forward | |||
Goodwill, Gross | 1,585 | 1,585 | |
Goodwill, net carrying amount | 1,585 | 1,585 | |
Bed Licenses Separable | |||
Intangible assets net excluding goodwill | |||
Finite and indefinite lived intangible assets, gross | [1] | 2,471 | 2,471 |
Intangible assets, net carrying amount | [1] | 2,471 | 2,471 |
Bed Licenses Included in Property and Equipment | |||
Intangible assets net excluding goodwill | |||
Finite and indefinite lived intangible assets, gross | [2] | 14,276 | 14,276 |
Finite and indefinite lived intangible assets, accumulated amortization | [2] | (4,790) | (4,583) |
Intangible assets, net carrying amount | [2] | 9,486 | 9,693 |
Lease Rights | |||
Intangible assets net excluding goodwill | |||
Finite and indefinite lived intangible assets, gross | 206 | 206 | |
Finite and indefinite lived intangible assets, accumulated amortization | (108) | (96) | |
Intangible assets, net carrying amount | $ 98 | $ 110 | |
[1] The Company does not amortize indefinite-lived intangibles, which consist of separable bed licenses and goodwill Non-separable bed licenses are included in property and equipment as is the related accumulated amortization expense (see Note 4 – Property and Equipment ). |
Intangible Assets and Goodwil_3
Intangible Assets and Goodwill - Schedule of Total Amortization Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Finite Lived Intangible Assets [Line Items] | ||||
Amortization | $ 109 | $ 110 | $ 219 | $ 219 |
Bed Licenses Included in Property and Equipment | ||||
Finite Lived Intangible Assets [Line Items] | ||||
Amortization | 103 | 104 | 207 | 207 |
Lease Rights | ||||
Finite Lived Intangible Assets [Line Items] | ||||
Amortization | $ 6 | $ 6 | $ 12 | $ 12 |
Intangible Assets and Goodwil_4
Intangible Assets and Goodwill - Schedule of Estimated Amortization Expense for All Definite Lived Intangibles (Details) $ in Thousands | Jun. 30, 2023 USD ($) |
Bed Licenses Included in Property and Equipment | |
Finite Lived Intangible Assets [Line Items] | |
2023 (6 months remaining) | $ 207 |
2024 | 414 |
2025 | 414 |
2026 | 414 |
2027 | 414 |
Thereafter | 7,623 |
Total expected amortization expense | 9,486 |
Lease Rights | |
Finite Lived Intangible Assets [Line Items] | |
2023 (6 months remaining) | 12 |
2024 | 24 |
2025 | 24 |
2026 | 24 |
2027 | 14 |
Total expected amortization expense | $ 98 |
Leases - Operating Leases - Add
Leases - Operating Leases - Additional Information (Details) | 6 Months Ended |
Jun. 30, 2023 ft² Facility | |
Operating Leased Assets [Line Items] | |
Number of SNFs under non-cancelable operating leases | Facility | 1 |
Lease termination , descreption | The Company also leased certain office space located in Suwanee, Georgia through the termination date of June 30, 2023. |
Weighted average remaining lease term | 5 years 9 months 18 days |
GEORGIA | |
Operating Leased Assets [Line Items] | |
Office space subleased | ft² | 2,000 |
Sublease expiration date | Jul. 31, 2025 |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Lease Payments (Details) $ in Thousands | Jun. 30, 2023 USD ($) | |
Future Rental Payments [Abstract] | ||
2023 (6 months remaining) | $ 312 | |
2024 | 633 | |
2025 | 645 | |
2026 | 658 | |
2027 | 671 | |
Thereafter | 914 | |
Total | 3,833 | |
Accretion of Lease Liability [Abstract] | ||
2023 (6 months remaining) | (7) | [1] |
2024 | (50) | [1] |
2025 | (97) | [1] |
2026 | (141) | [1] |
2027 | (184) | [1] |
Thereafter | (310) | [1] |
Total | (789) | [1] |
Operating Lease Obligation [Abstract] | ||
2023 (6 months remaining) | 305 | |
2024 | 582 | |
2025 | 549 | |
2026 | 517 | |
2027 | 487 | |
Thereafter | 604 | |
Total | $ 3,044 | |
[1] Weighted a verage discount rate 3.85 %. |
Leases - Schedule of Future M_2
Leases - Schedule of Future Minimum Lease Payments (Parenthetical) (Details) | Jun. 30, 2023 |
Leases [Abstract] | |
Weighted average discount rate | 3.85% |
Leases - Facilities Lessor - Ad
Leases - Facilities Lessor - Additional Information (Details) | 6 Months Ended |
Jun. 30, 2023 Facility | |
Leases [Abstract] | |
Number of owned facilities | 11 |
Number of owned facilities, Lessor | 9 |
Number of owned facilities, Sub lessor | 1 |
Weighted average remaining sublease term, Facilities lessor | 5 years 9 months 18 days |
Leases - Schedule of Future M_3
Leases - Schedule of Future Minimum Lease Receivables from Company's Facilities Leased and Subleased to Third Party Tenants (Details) $ in Thousands | Jun. 30, 2023 USD ($) |
Operating Leases, Future Minimum Payments Receivable [Abstract] | |
2023 (6 months remaining) | $ 3,139 |
2024 | 6,187 |
2025 | 6,034 |
2026 | 5,362 |
2027 | 5,445 |
Thereafter | 11,605 |
Total | $ 37,772 |
Accrued Expenses - Schedule of
Accrued Expenses - Schedule of Accrued Expenses (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 | |
Payables and Accruals [Abstract] | |||
Accrued employee benefits and payroll-related | $ 356 | $ 539 | |
Real estate and other taxes | [1] | 2,667 | 2,428 |
Self-insured reserve | 65 | 80 | |
Accrued interest | 223 | 210 | |
Unearned rental revenue | 43 | ||
Medicaid overpayment - Healthcare Services | 52 | 169 | |
Insurance escrow | 55 | ||
Other accrued expenses | 1,414 | 1,567 | |
Total accrued expenses | $ 4,832 | $ 5,036 | |
[1] June 30, 2023 includes approximately $ 2.3 million of franchise tax accruals for the Healthcare Services segment. December 31, 2022 includes approximately $ 2.2 million of franchise tax accruals for the Healthcare Services segment. |
Accrued Expenses - Schedule o_2
Accrued Expenses - Schedule of Accrued Expenses (Parenthetical) (Details) - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Healthcare Services Segment | ||
Payables And Accruals [Line Items] | ||
Franchise Tax | $ 2.3 | $ 2.2 |
Notes Payable and Other Debt -
Notes Payable and Other Debt - Summary of Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Debt instrument, outstanding amount | $ 53,136 | $ 53,302 |
Deferred financing costs | (988) | (1,005) |
Unamortized discount on bonds | (116) | (119) |
Notes payable and other debt | 52,032 | 52,178 |
Senior debt - guaranteed by HUD | ||
Debt Instrument [Line Items] | ||
Debt instrument, outstanding amount | 29,384 | 29,782 |
Senior debt - guaranteed by USDA | ||
Debt Instrument [Line Items] | ||
Debt instrument, outstanding amount | 7,403 | 7,526 |
Senior debt - guaranteed by SBA | ||
Debt Instrument [Line Items] | ||
Debt instrument, outstanding amount | 567 | 580 |
Senior debt Bonds, net of discount | ||
Debt Instrument [Line Items] | ||
Debt instrument, outstanding amount | 6,117 | 6,253 |
Senior debt - other mortgage indebtedness | ||
Debt Instrument [Line Items] | ||
Debt instrument, outstanding amount | 8,175 | 8,266 |
Other Debt | ||
Debt Instrument [Line Items] | ||
Debt instrument, outstanding amount | $ 1,490 | $ 895 |
Notes Payable and Other Debt _2
Notes Payable and Other Debt - Details of Long-term Debt (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Dec. 31, 2022 | |
Debt Instrument [Line Items] | ||
Debt instrument, outstanding amount | $ 53,136 | $ 53,302 |
Senior debt - guaranteed by HUD | ||
Debt Instrument [Line Items] | ||
Debt instrument, outstanding amount | 29,384 | 29,782 |
Senior debt - guaranteed by USDA | ||
Debt Instrument [Line Items] | ||
Debt instrument, outstanding amount | 7,403 | 7,526 |
Senior debt - guaranteed by SBA | ||
Debt Instrument [Line Items] | ||
Debt instrument, outstanding amount | 567 | 580 |
Senior Debt Other Mortgage Indebtedness | ||
Debt Instrument [Line Items] | ||
Debt instrument, outstanding amount | 8,175 | 8,266 |
Senior Debt Obligations | Senior debt - guaranteed by HUD | ||
Debt Instrument [Line Items] | ||
Debt instrument, outstanding amount | 29,385 | 29,782 |
Senior Debt Obligations | Senior debt - guaranteed by USDA | ||
Debt Instrument [Line Items] | ||
Debt instrument, outstanding amount | 7,403 | 7,526 |
Senior Debt Obligations | Senior debt - guaranteed by SBA | ||
Debt Instrument [Line Items] | ||
Debt instrument, outstanding amount | 567 | 580 |
Other Debt | ||
Debt Instrument [Line Items] | ||
Debt instrument, outstanding amount | $ 1,490 | 895 |
Newpoint Capital | The Pavilion Care Center | Senior Debt Obligations | Senior debt - guaranteed by HUD | ||
Debt Instrument [Line Items] | ||
Maturity date | Dec. 01, 2039 | |
Interest rate | 3.97% | |
Debt instrument, outstanding amount | $ 819 | 835 |
Newpoint Capital | Hearth And Care Of Greenfield | Senior Debt Obligations | Senior debt - guaranteed by HUD | ||
Debt Instrument [Line Items] | ||
Maturity date | Aug. 01, 2050 | |
Interest rate | 3.97% | |
Debt instrument, outstanding amount | $ 1,929 | 1,949 |
Newpoint Capital | Woodland Manor | Senior Debt Obligations | Senior debt - guaranteed by HUD | ||
Debt Instrument [Line Items] | ||
Maturity date | Nov. 01, 2052 | |
Interest rate | 3.97% | |
Debt instrument, outstanding amount | $ 4,936 | 4,980 |
Newpoint Capital | Glenvue H&R | Senior Debt Obligations | Senior debt - guaranteed by HUD | ||
Debt Instrument [Line Items] | ||
Maturity date | Oct. 01, 2044 | |
Interest rate | 3.75% | |
Debt instrument, outstanding amount | $ 7,189 | 7,297 |
Newpoint Capital | Georgetown Health | Senior Debt Obligations | Senior debt - guaranteed by HUD | ||
Debt Instrument [Line Items] | ||
Maturity date | Oct. 01, 2046 | |
Interest rate | 2.98% | |
Debt instrument, outstanding amount | $ 3,167 | 3,214 |
KeyBank | Other Debt | ||
Debt Instrument [Line Items] | ||
Maturity date | Aug. 25, 2025 | |
Interest rate | 0% | |
Debt instrument, outstanding amount | $ 495 | 495 |
KeyBank | Autumn Breeze | Senior Debt Obligations | Senior debt - guaranteed by HUD | ||
Debt Instrument [Line Items] | ||
Maturity date | Jan. 01, 2045 | |
Interest rate | 3.65% | |
Debt instrument, outstanding amount | $ 6,250 | 6,344 |
KeyBank | Sumter Valley | Senior Debt Obligations | Senior debt - guaranteed by HUD | ||
Debt Instrument [Line Items] | ||
Maturity date | Jan. 01, 2047 | |
Interest rate | 3.70% | |
Debt instrument, outstanding amount | $ 5,095 | 5,163 |
Marlin Capital Solutions | Other Debt | ||
Debt Instrument [Line Items] | ||
Maturity date | Jun. 01, 2027 | |
Interest rate | 5% | |
Debt instrument, outstanding amount | $ 33 | 43 |
Community Bank | Mountain Trace Rehab | Senior Debt Obligations | Senior debt - guaranteed by USDA | ||
Debt Instrument [Line Items] | ||
Maturity date | Dec. 24, 2036 | |
Debt instrument, outstanding amount | $ 3,610 | 3,680 |
Effective interest rate (as a percent) | 9.25% | |
Community Bank | Mountain Trace Rehab | Senior Debt Obligations | Senior debt - guaranteed by USDA | Prime Rate | ||
Debt Instrument [Line Items] | ||
Basis spread | 1.75% | |
Cadence Bank N A | Southland Healthcare | Senior Debt Obligations | Senior debt - guaranteed by USDA | ||
Debt Instrument [Line Items] | ||
Maturity date | Jul. 27, 2036 | |
Debt instrument, outstanding amount | $ 3,793 | 3,846 |
Effective interest rate (as a percent) | 9% | |
Cadence Bank N A | Southland Healthcare | Senior Debt Obligations | Senior debt - guaranteed by USDA | Prime Rate | ||
Debt Instrument [Line Items] | ||
Basis spread | 1.50% | |
Cadence Bank N A | Southland Healthcare | Senior Debt Obligations | Senior debt - guaranteed by SBA | ||
Debt Instrument [Line Items] | ||
Maturity date | Jul. 27, 2036 | |
Debt instrument, outstanding amount | $ 567 | 580 |
Effective interest rate (as a percent) | 9.75% | |
Cadence Bank N A | Southland Healthcare | Senior Debt Obligations | Senior debt - guaranteed by SBA | Prime Rate | ||
Debt Instrument [Line Items] | ||
Basis spread | 2.25% | |
City of Springfield | Eaglewood Care Center | Bonds | Bonds Series A | ||
Debt Instrument [Line Items] | ||
Maturity date | May 01, 2042 | |
Interest rate | 7.65% | |
Debt instrument, outstanding amount | $ 6,117 | 6,253 |
Exchange Bank Of Alabama | Meadowood Facility | ||
Debt Instrument [Line Items] | ||
Maturity date | Oct. 01, 2026 | |
Effective interest rate (as a percent) | 4.50% | |
Exchange Bank Of Alabama | Meadowood Facility | Senior Debt Other Mortgage Indebtedness | ||
Debt Instrument [Line Items] | ||
Debt instrument, outstanding amount | $ 3,319 | 3,319 |
Exchange Bank Of Alabama | Coosa Valley Health Care | ||
Debt Instrument [Line Items] | ||
Maturity date | Oct. 10, 2026 | |
Effective interest rate (as a percent) | 3.95% | |
Exchange Bank Of Alabama | Coosa Valley Health Care | Senior Debt Other Mortgage Indebtedness | ||
Debt Instrument [Line Items] | ||
Debt instrument, outstanding amount | $ 4,856 | 4,946 |
First Insurance Funding | Other Debt | ||
Debt Instrument [Line Items] | ||
Maturity date | Various 2023 | |
Interest rate | 3.19% | |
Debt instrument, outstanding amount | $ 962 | $ 357 |
Notes Payable and Other Debt _3
Notes Payable and Other Debt - Details of Long-term Debt (Parenthetical) (Details) $ in Millions | 6 Months Ended | 9 Months Ended | ||
Dec. 30, 2022 | Oct. 01, 2021 | Jun. 30, 2023 Bed Facility | Sep. 30, 2021 USD ($) | |
Meadowood Facility | ||||
Debt Instrument [Line Items] | ||||
Debt instrument maturity date start range | May 01, 2022 | |||
Debt instrument maturity date end range | Oct. 01, 2026 | |||
Coosa Valley Health Care | ||||
Debt Instrument [Line Items] | ||||
Prepayment penalties capped percentage | 5% | |||
Prepayment penalties percentage capped thereafter | 1% | |||
New fees amount | $ | $ 0.1 | |||
Default interest rate | 5% | |||
Prepayment penalties capped percentage in second year | 4% | |||
KeyBank | ||||
Debt Instrument [Line Items] | ||||
Debt instrument maturity date start range | Aug. 25, 2023 | |||
Debt instrument maturity date end range | Aug. 25, 2025 | |||
Senior debt - guaranteed by HUD | ||||
Debt Instrument [Line Items] | ||||
Number of skilled nursing facilities | 7 | |||
Percentage of debt insured | 100% | |||
Senior debt - guaranteed by USDA | ||||
Debt Instrument [Line Items] | ||||
Number of skilled nursing facilities | 2 | |||
Annual renewal fee for the USDA guarantee (as a percent) | 0.25% | |||
Debt Instrument Prepayment Penalties Percentage | 1% | |||
Prepayment penalties capped percentage | 1% | |||
Prepayment penalties percentage capped, period | 10 years | |||
Prepayment penalties percentage capped thereafter | 0% | |||
Senior debt - guaranteed by SBA | ||||
Debt Instrument [Line Items] | ||||
Number of skilled nursing facilities | 1 | |||
Percentage of debt insured | 75% | |||
Number of licensed beds | Bed | 126 | |||
Senior debt Bonds, net of discount | ||||
Debt Instrument [Line Items] | ||||
Amortization of deferred financing costs (in percentage) | 0.10% | |||
Senior debt - other mortgage indebtedness | ||||
Debt Instrument [Line Items] | ||||
Amortization of deferred financing costs (in percentage) | 0.34% | |||
Minimum | ||||
Debt Instrument [Line Items] | ||||
Amortization of deferred financing costs (in percentage) | 0.09% | |||
Minimum | Senior debt - guaranteed by USDA | ||||
Debt Instrument [Line Items] | ||||
Percentage of debt insured | 70% | |||
Maximum | ||||
Debt Instrument [Line Items] | ||||
Amortization of deferred financing costs (in percentage) | 0.53% | |||
Maximum | Senior debt - guaranteed by USDA | ||||
Debt Instrument [Line Items] | ||||
Percentage of debt insured | 80% |
Notes Payable and Other Debt _4
Notes Payable and Other Debt - Additional Information (Details) | Jun. 30, 2023 Credit_instrument |
Debt Disclosure [Abstract] | |
Number of credit related instruments | 16 |
Notes Payable and Other Debt _5
Notes Payable and Other Debt - Summary of the Scheduled Maturities (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Debt Disclosure [Abstract] | ||
2023 (6 months remaining) | $ 1,263 | |
2024 | 1,966 | |
2025 | 2,157 | |
2026 | 8,622 | |
2027 | 1,421 | |
Thereafter | 37,707 | |
Subtotal | 53,136 | $ 53,302 |
Less: unamortized discounts | (116) | (119) |
Less: deferred financing costs, net | (988) | $ (1,005) |
Total notes and other debt | $ 52,032 |
Common and Preferred Stock - Ad
Common and Preferred Stock - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2023 | Jun. 27, 2023 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Class of Stock [Line Items] | |||||||
Common stock, shares authorized | 55,000,000 | 55,000,000 | 55,000,000 | 55,000,000 | |||
Common stock, shares issued | 1,894,000 | 1,894,000 | 1,894,000 | 1,793,000 | |||
Common stock, shares outstanding | 1,883,028 | 1,883,028 | 1,883,028 | 1,784,000 | |||
Gain on extinguishment of preferred stock | $ 43,395,000 | $ 43,395,000 | |||||
Subsequent Amendment of Prior Charter | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock, shares authorized | 5,000,000 | ||||||
Common stock, shares authorized | 55,000,000 | ||||||
Subsequent Amendment of Prior Charter | Maximum | |||||||
Class of Stock [Line Items] | |||||||
Shares authorized | 60,000,000 | ||||||
Certain Amendments to Prior Charter | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock, shares authorized | 6,000,000 | ||||||
Common stock, shares authorized | 55,000,000 | ||||||
Certain Amendments to Prior Charter | Maximum | |||||||
Class of Stock [Line Items] | |||||||
Shares authorized | 61,000,000 | ||||||
Series A Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock, fixed interest rate (percentage) | 10.875% | ||||||
Preferred stock, shares outstanding | 560,000 | 560,000 | 560,000 | 2,812,000 | |||
Percentage of outstanding preferred stock tendered | 80.10% | ||||||
Preferred stock, shares issued | 560,000 | 560,000 | 560,000 | 2,812,000 | |||
Preferred stock, shares tendered | 2,252,272 | ||||||
Preferred stock, shares authorized | 560,000 | 560,000 | 560,000 | 5,000,000 | |||
Preferred stock, redemption price per share | $ 5 | ||||||
Preferred stock terms | Series A Preferred Stock when voting as a single class with any other class or series of stock to one vote per $5.00 liquidation preference | ||||||
Stock retired and exchanged | 2,252,272 | ||||||
Dividends paid, preferred stock | $ 0 | $ 0 | $ 0 | $ 0 | |||
Unpaid dividends forteited | $ 50,400,000 | 50,400,000 | 50,400,000 | ||||
Stated liquidation preference | 5 | ||||||
Gain on extinguishment of preferred stock | $ 43,400,000 | ||||||
Fair value of the preferred stock per share | $ 0.76 | ||||||
Redemption price per share | $ 5 | ||||||
Preferred stock, redemption amount | $ 426,000 | $ 426,000 | $ 426,000 | $ 70,288,000 | |||
Series A Preferred Stock | Temporary Amendment of Prior Charter | Maximum | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock, shares authorized | 6,000,000 | ||||||
Series A Preferred Stock | Subsequent Amendment of Prior Charter | Maximum | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock, shares authorized | 5,000,000 | ||||||
Series B Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock, fixed interest rate (percentage) | 12.50% | ||||||
Preferred stock, shares outstanding | 2,252,272 | 2,252,272 | 2,252,272 | 0 | |||
Preferred stock, shares issued | 2,252,272 | 2,252,272 | 2,252,272 | 0 | |||
Preferred stock, shares authorized | 2,812,000 | 2,812,000 | 2,812,000 | 0 | |||
Dividend period commencing date | Jul. 01, 2027 | ||||||
Stock retired and exchanged | 2,252,272 | ||||||
Dividends paid, preferred stock | $ 0 | 0 | $ 0 | 0 | |||
Stated liquidation preference | $ 10 | $ 10 | $ 10 | ||||
Preferred stock liquidation preference reduced per share | 5 | ||||||
Preferred stock liquidation preference increase over time | 25 | ||||||
Fair value of the preferred stock per share | $ 8.26 | ||||||
Preferred stock, redemption amount | $ 18,602,000 | $ 18,602,000 | $ 18,602,000 | ||||
Series B Preferred Stock | Maximum | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock, shares outstanding | 200,000 | 200,000 | 200,000 | ||||
Series E Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock, shares outstanding | 0 | 0 | 0 | ||||
Preferred stock, shares issued | 0 | 0 | 0 | ||||
Dividends payable date declared | Feb. 13, 2023 | ||||||
Dividends payable, date of record | Feb. 27, 2023 | ||||||
Dividends payable, date to be paid | Feb. 28, 2023 | ||||||
Terms of dividend payment | On February 13, 2023, the Board declared a dividend of one one-thousandth of a share of Series E Preferred Stock for each outstanding share of common stock, payable on February 28, 2023 to shareholders of record at 5:00 p.m. Eastern Time on February 27, 2023 (the “Dividend Record Date”). | ||||||
Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Common stock, shares authorized | 55,000,000 | 55,000,000 | 55,000,000 | ||||
Common stock, shares issued | 1,893,908 | 1,893,908 | 1,893,908 | ||||
Dividends paid, common stock | $ 0 | $ 0 | $ 0 | $ 0 | |||
Preferred Stock | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock, shares outstanding | 2,811,535 | 2,811,535 | 2,811,535 | ||||
Preferred stock, shares issued | 2,811,535 | 2,811,535 | 2,811,535 | ||||
Preferred stock, shares authorized | 5,000,000 | 5,000,000 | 5,000,000 |
Stock Based Compensation - Addi
Stock Based Compensation - Additional Information (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2023 | Dec. 15, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unrecognized compensation expense | $ 400,000 | |
Employee | Warrants | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unrecognized compensation expense | 0 | |
Restricted Stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unrecognized compensation expense | $ 400,000 | |
Period of recognition of compensation expense | 2 years 7 months 6 days | |
Stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Options, granted during the period | 24,000 | |
2020 Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of awards made under employee stock option plan | 0 | |
Incentive stock options may be granted after 10th anniversary of date of Board approval | 0 | |
Number of securities remaining available for future issuance | 52,805 | |
2011 plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Maximum number of shares of the company's stock that may be issued | 168,950 | |
Additional award granted | 0 | |
Maximum | 2020 Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Maximum number of shares of the company's stock that may be issued | 250,000 |
Stock Based Compensation - Summ
Stock Based Compensation - Summary of Recognized Stock Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 155 | $ 4 | $ 236 | $ 115 |
Employee | Stock compensation expense | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 155 | 58 | 236 | 169 |
Employee | Forfeitures of Stock Based Awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 0 | $ (54) | $ 0 | $ (54) |
Stock Based Compensation - Su_2
Stock Based Compensation - Summary of Company's Restricted Stock Activity (Details) - Restricted Stock shares in Thousands | 6 Months Ended |
Jun. 30, 2023 $ / shares shares | |
Number of Shares (000's) | |
Unvested at the beginning of the period (in shares) | shares | 51 |
Granted (in shares) | shares | 99 |
Vested (in shares) | shares | (26) |
Unvested at the end of the period (in shares) | shares | 124 |
Weighted Average Grant Date Fair Value | |
Unvested at the beginning of the period (in dollars per share) | $ / shares | $ 8.99 |
Granted (in dollars per share) | $ / shares | 3.61 |
Vested (in dollars per share) | $ / shares | 9.06 |
Unvested at the ending of the period (in dollars per share) | $ / shares | $ 4.68 |
Stock Based Compensation - Su_3
Stock Based Compensation - Summary of Company's Stock Option Activity (Details) - Stock options - USD ($) $ / shares in Units, shares in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2023 | Dec. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||
Beginning balance (shares) | 13 | |
Granted, number of shares | 24 | |
Ending balance (shares) | 37 | 13 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||
Beginning balance (USD per share) | $ 47.53 | |
Granted, weighted average exercise price | 3.32 | |
Ending balance (USD per share) | $ 18.63 | $ 47.53 |
Additional disclosures | ||
Outstanding and vested - weighted average remaining contractual life | 6 years 7 months 6 days | 6 months |
Granted - weighted average remaining contractual life | 9 years 6 months | |
Outstanding and vested, aggregate intrinsic value | $ 6,700 | $ 0 |
Stock Based Compensation - Sche
Stock Based Compensation - Schedule of Exercise Price Range (Details) shares in Thousands | 6 Months Ended |
Jun. 30, 2023 $ / shares shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options outstanding, number (shares) | shares | 37 |
Stock options outstanding, weighted average remaining contractual term (in years) | 6 years 7 months 6 days |
Stock options outstanding, weighted average exercise price (USD per share) | $ / shares | $ 18.63 |
Options exercisable, vested and exercisable (shares) | shares | 37 |
Options exercisable, weighted average exercise price (USD per share) | $ / shares | $ 18.63 |
$3.32 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options outstanding, number (shares) | shares | 24 |
Stock options outstanding, weighted average remaining contractual term (in years) | 9 years 6 months |
Stock options outstanding, weighted average exercise price (USD per share) | $ / shares | $ 3.32 |
Options exercisable, vested and exercisable (shares) | shares | 24 |
Options exercisable, weighted average exercise price (USD per share) | $ / shares | $ 3.32 |
$46.80 - $48.72 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock options outstanding, number (shares) | shares | 13 |
Stock options outstanding, weighted average remaining contractual term (in years) | 4 months 24 days |
Stock options outstanding, weighted average exercise price (USD per share) | $ / shares | $ 47.42 |
Options exercisable, vested and exercisable (shares) | shares | 13 |
Options exercisable, weighted average exercise price (USD per share) | $ / shares | $ 47.42 |
Stock Based Compensation - Sc_2
Stock Based Compensation - Schedule of Exercise Price Range (Parenthetical) (Details) | 6 Months Ended |
Jun. 30, 2023 $ / shares | |
$3.32 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Exercise price, (USD per share) | $ 3.32 |
$46.80 - $48.72 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Exercise price, minimum (USD per share) | 46.8 |
Exercise price, maximum (USD per share) | $ 48.72 |
Stock Based Compensation - Sc_3
Stock Based Compensation - Schedule of Common Stock Warrant Activity (Details) - Warrants - $ / shares shares in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2023 | Dec. 31, 2022 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Outstanding and vested at the beginning of the period (in shares) | 35 | |
Expired (in shares) | (2) | |
Outstanding and vested at the ending of the period (in shares) | 33 | 35 |
Outstanding and vested at the beginning of the period (in dollars per share) | $ 53.31 | |
Expired (in dollars per share) | 70.8 | |
Outstanding and vested at the ending of the period (in dollars per share) | $ 52.38 | $ 53.31 |
Weighted average remaining contractual term (in years) | 1 year 6 months | 1 year 10 months 24 days |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 USD ($) Case | Dec. 31, 2022 USD ($) | |
Loss Contingencies [Line Items] | ||
Pending litigation | 10 | |
Self-insured reserve | $ | $ 65 | $ 80 |
Accounts Payable | ||
Loss Contingencies [Line Items] | ||
Self-insured reserve | $ | 100 | 100 |
Accrued Expenses | ||
Loss Contingencies [Line Items] | ||
Self-insured reserve | $ | $ 100 | $ 200 |
Professional and General Liability Actions | ||
Loss Contingencies [Line Items] | ||
Pending litigation | 8 | |
Professional and General Liability Actions | Patient Care that Current or Prior Tenants Provided to their Patients | ||
Loss Contingencies [Line Items] | ||
Pending litigation | 9 | |
ARKANSAS | Pending Litigation | ||
Loss Contingencies [Line Items] | ||
Loss contingency claims after disposal of facilities | 4 |
Segment Results - Additional In
Segment Results - Additional Information (Details) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 USD ($) Segment | Dec. 31, 2022 USD ($) | |
Segment Reporting Information [Line Items] | ||
Number of primary reporting segments | Segment | 2 | |
Description of primary reporting segments | (i) Real Estate Services, which consists of the leasing and subleasing of long-term care and senior living facilities to third-party tenants, including the Company's management of three facilities on behalf of third-party owners; and (ii) Healthcare Services, which consists of the operation of the Meadowood and Glenvue facilities. | |
Assets | $ 65,854 | $ 68,580 |
Real Estate Services | ||
Segment Reporting Information [Line Items] | ||
Assets | 57,500 | 63,500 |
Healthcare Services Segment | ||
Segment Reporting Information [Line Items] | ||
Assets | $ 8,400 | $ 5,600 |
Segment Results - Summary of Re
Segment Results - Summary of Results of Operations for Reporting Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Revenues: | ||||
Total revenues | $ 4,598 | $ 8,093 | $ 8,504 | $ 14,740 |
Rental revenues | 1,722 | 3,261 | 3,430 | 7,326 |
Expenses: | ||||
Patient care expense | 2,159 | 4,222 | 4,697 | 6,564 |
Facility rent expense | 149 | 1,634 | 297 | 3,274 |
Cost of management fees | 146 | 144 | 286 | 319 |
Depreciation and amortization | 702 | 606 | 1,212 | 1,219 |
General and administrative expense | 1,011 | 921 | 2,217 | 2,054 |
Doubtful accounts expense | 24 | 466 | 40 | 2,227 |
Other operating expenses | 221 | 629 | 313 | 968 |
Total expenses | 4,412 | 8,622 | 9,062 | 16,625 |
Income/(Loss) from operations | 186 | (529) | (558) | (1,885) |
Other expense (income) : | ||||
Interest expense, net | 679 | 639 | 1,359 | 1,291 |
Other expense, net | 192 | 157 | 759 | 1,076 |
Total other expense, net | 871 | 796 | 2,118 | 2,367 |
Net loss | (685) | (1,325) | (2,676) | (4,252) |
Patient Care Revenues | ||||
Revenues: | ||||
Total revenues | 2,526 | 4,570 | 4,442 | 6,881 |
Management Fees | ||||
Revenues: | ||||
Total revenues | 247 | 255 | 525 | 519 |
Other Revenues | ||||
Revenues: | ||||
Total revenues | 103 | 7 | 107 | 14 |
Real Estate Services | ||||
Revenues: | ||||
Total revenues | 2,072 | 3,523 | 4,062 | 7,859 |
Rental revenues | 1,722 | 3,261 | 3,430 | 7,326 |
Expenses: | ||||
Facility rent expense | 149 | 1,106 | 297 | 2,448 |
Cost of management fees | 146 | 144 | 286 | 319 |
Depreciation and amortization | 599 | 599 | 1,106 | 1,206 |
General and administrative expense | 978 | 679 | 2,020 | 1,685 |
Doubtful accounts expense | 466 | 2,227 | ||
Other operating expenses | 91 | 337 | 170 | 636 |
Total expenses | 1,963 | 3,331 | 3,879 | 8,521 |
Income/(Loss) from operations | 109 | 192 | 183 | (662) |
Other expense (income) : | ||||
Interest expense, net | 601 | 636 | 1,279 | 1,266 |
Other expense, net | 191 | 157 | 541 | 1,076 |
Total other expense, net | 792 | 793 | 1,820 | 2,342 |
Net loss | (683) | (601) | (1,637) | (3,004) |
Real Estate Services | Management Fees | ||||
Revenues: | ||||
Total revenues | 247 | 255 | 525 | 519 |
Real Estate Services | Other Revenues | ||||
Revenues: | ||||
Total revenues | 103 | 7 | 107 | 14 |
Healthcare Services Segment | ||||
Revenues: | ||||
Total revenues | 2,526 | 4,570 | 4,442 | 6,881 |
Expenses: | ||||
Patient care expense | 2,159 | 4,222 | 4,697 | 6,564 |
Facility rent expense | 528 | 826 | ||
Depreciation and amortization | 103 | 7 | 106 | 13 |
General and administrative expense | 33 | 242 | 197 | 369 |
Doubtful accounts expense | 24 | 40 | ||
Other operating expenses | 130 | 292 | 143 | 332 |
Total expenses | 2,449 | 5,291 | 5,183 | 8,104 |
Income/(Loss) from operations | 77 | (721) | (741) | (1,223) |
Other expense (income) : | ||||
Interest expense, net | 78 | 3 | 80 | 25 |
Other expense, net | 1 | 218 | ||
Total other expense, net | 79 | 3 | 298 | 25 |
Net loss | (2) | (724) | (1,039) | (1,248) |
Healthcare Services Segment | Patient Care Revenues | ||||
Revenues: | ||||
Total revenues | $ 2,526 | $ 4,570 | $ 4,442 | $ 6,881 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) | 6 Months Ended | ||
Aug. 11, 2023 USD ($) | Jul. 01, 2023 ft² | Jun. 30, 2023 ft² | |
Georgia | |||
Subsequent Event [Line Items] | |||
Office space subleased | ft² | 2,000 | ||
Sublease expiration date | Jul. 31, 2025 | ||
Subsequent Event | |||
Subsequent Event [Line Items] | |||
Lease amendment, decrease in monthly rent | $ 43,000 | ||
Lease amendment, included promissory note | $ 312,000 | ||
Lease expiration date | Oct. 31, 2024 | ||
Subsequent Event | Promissory Note | |||
Subsequent Event [Line Items] | |||
Interest rate principal sum plus all accrued interest | 8% | ||
Subsequent Event | Promissory Note | Minimum | |||
Subsequent Event [Line Items] | |||
Minimum monthly payments of principal and interest | $ 18,353 | ||
Subsequent Event | Georgia | |||
Subsequent Event [Line Items] | |||
Office space subleased | ft² | 2,000 | ||
Sublease expiration date | Jun. 30, 2025 |