Exhibit 99.2
GLOBAL MEDICAL REIT, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Global Medical REIT, Inc. made the following acquisition since September 1, 2012:
| | | | | |
Property Name | | Date of Acquisition | | Net Purchase Price |
The Facility in Omaha, Nebraska | | June 5, 2014 | | $ | 21.7 million |
The unaudited pro forma condensed consolidated balance sheet assumes that the 2014 acquisition occurred on February 28, 2014 and the unaudited pro forma condensed consolidated statements of operations assume that all acquisitions described above occurred on September 1, 2012.
In management’s opinion, all adjustments necessary to reflect the effects of these acquisitions have been made. The unaudited pro forma condensed consolidated statements of operations are not necessarily indicative of what actual results of operations would have been had the Company made these acquisitions on the first day of the period presented, nor does it purport to represent the results of operations for future periods.
GLOBAL MEDICAL REIT, INC.
Unaudited Pro Forma Condensed Consolidated Balance Sheet as of February 28, 2014
| | | | | | | | | |
| | February 28, 2014 | | Adjustments for the Facility Acquisition | | Pro Forma |
| | | | | | | | | |
Assets | | | | | | | | | |
Cash and cash equivalents | | $ | 3,415 | | $ | 685,917 | A, B, C, D | $ | 689,332 |
Prepaid expenses | | | 3,632 | | | - | | | 3,632 |
Building | | | | | | 21,710,000 | A | | 21,710,000 |
Deferred financing costs, net | | | | | | 273,191 | A | | 273,191 |
Total assets | | $ | 7,047 | | $ | 22,669,108 | | $ | 22,676,155 |
| | | | | | | | | |
Liabilities and Equity | | | | | | | | | |
Liabilities: | | | | | | | | | |
| | | | | | | | | |
Accounts payable and accrued expenses | | | 20,989 | | | $ 218,690 | B | | 239,679 |
Due to affiliates | | | 23,315 | | | 434,200 | C | | 457,515 |
Notes payable to affiliates | | | | | | 7,500,000 | D | | 7,500,000 |
Notes payable | | | | | | 15,060,000 | A | | 15,060,000 |
Total liabilities | | | 44,304 | | | 23,212,890 | | | 23,257,194 |
| | | | | | | | | |
Equity: | | | | | | | | | |
Stockholders' Equity | | | | | | | | | |
Common stock: Authorized: 200,000,000 shares, par value $.001, 8,000,000 shares issued and outstanding | | | 8,000 | | | | | | 8,000 |
Additional paid in capital | | | 72,000 | | | - | | | 72,000 |
Deficit accumulated during the development stage | | | (117,257) | | | (543,782) | A | | (661,039) |
Stockholders' Equity | | | (37,257) | | | (543,782) | | | (581,039) |
| | | | | | | | | |
Total Liabilities and Stockholders’ Equity: | | $ | 7,047 | | $ | 22,669,108 | | $ | 22,676,155 |
Adjustments
A
To record the acquisition of hospital facility located at 1870 S 75th Street, Omaha, Nebraska (the "Facility"). Investment property was recorded at fair value. Pro forma adjustments related to these amounts are preliminary and subject to change.
B
To record the pro forma effect of the Company’s acquisition expenses related to the acquisition of the Facility.
C
To record the pro forma effect of the Company’s acquisition fee of 2% related to the acquisition of the Facility.
D
To record the pro forma effect of shareholder loan used to fund the acquisition of the Facility.
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GLOBAL MEDICAL REIT, INC.
Unaudited Pro Forma Condensed Consolidated Statement of Operations
for the Six Months Ended February 28, 2014
| | | | | | | | | |
| | Six months ending February 28, 2014 | | Adjustments for the Acquisition | | Pro Forma |
| | | | | | | | | |
Revenues: | | | | | | | | | |
Rental revenue | | $ | - | | $ | 782,984 | B | $ | 782,984 |
| | | | | | | | | |
Expenses: | | | | | | | | | |
Property operating expenses | | | - | | | 290 | B | | 290 |
Land lease expense | | | - | | | 29,939 | B | | 29,939 |
Depreciation | | | - | | | 278,333 | B | | 278,333 |
Asset management fees | | | - | | | 3,915 | B | | 3,915 |
General and administrative expenses | | | 21,352 | | | 2,253 | B | | 23,605 |
Total expenses | | | 21,352 | | | 314,730 | | | 336,082 |
| | | | | | | | | |
Other expenses: | | | | | | | | | |
Interest expense | | | - | | | 409,862 | A, C | | 409,862 |
| | | | | | | | | |
Net income (loss) attributable to common stockholders | | $ | (21,352) | | $ | 58,392 | | $ | 37,040 |
Basic and diluted income (loss) per common share: | | $ | (0.00) | | $ | | | $ | 0.00 |
Weighted average number common shares outstanding | | | 8,000,000 | | | | | | 8,000,000 |
Adjustments
A
To record the pro forma effect of interest expense on borrowings of $15.06 million term loan with Capital One, National Association related to the acquisition of the Facility assuming that the borrowing was outstanding as of September 1, 2012. The interest rate was 4.91% as of the date of acquisition.
B
To record the pro forma effect of the Company’s acquisition of the Facility based on its historical results of operations assuming that the acquisition had occurred on September 1, 2012.
C
To record the pro forma effect of the Company’s amortization calculated based on the deferred financing costs incurred
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GLOBAL MEDICAL REIT, INC.
Unaudited Pro Forma Condensed Consolidated Statement of Operations for the Year Ended August 31, 2013
| | | | | | | | | |
| | Year Ended August 31, 2013 | | Adjustments for the Acquisition | | Pro Forma |
| | | | | | | | | |
Revenues: | | | | | | | | | |
Rental revenue | | $ | | | $ | 1,527,962 | B | $ | 1,527,962 |
| | | | | | | | | |
Expenses: | | | | | | | | | |
Property operating expenses | | | | | | 853 | B | | 853 |
Land lease expense | | | | | | 54,887 | B | | 54,887 |
Depreciation and amortization | | | | | | 556,667 | B | | 556,667 |
Asset management fees | | | | | | 7,602 | B | | 7,602 |
General and administrative expenses | | | 45,338 | | | 8,611 | B | | 53,949 |
Total expenses | | | 45,338 | | | 628,620 | | | 673,958 |
| | | | | | | | | |
Other expenses: | | | | | | | | | |
Interest expense | | | | | | 830,996 | A, C | | 830,996 |
| | | | | | | | | |
Net income (loss) attributable to common stockholders | | $ | (45,338) | | $ | 68,346 | | $ | 23,008 |
Basic and diluted income (loss) per common share: | | $ | (0.01) | | $ | - | | $ | 0.00 |
Weighted average number common shares outstanding | | | 7,828,767 | | | - | | | 7,828,767 |
Adjustments
A
To record the pro forma effect of interest expense on borrowings of $15.06 million term loan with Capital One, National Association related to the acquisition of the Facility assuming that the borrowing was outstanding as of September 1, 2012. The interest rate was 4.91% as of the date of acquisition.
B
To record the pro forma effect of the Company’s acquisition of the Facility based on its historical results of operations assuming that the acquisition had occurred on September 1, 2012.
C
To record the pro forma effect of the Company’s amortization calculated based on the deferred financing costs incurred
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GLOBAL MEDICAL REIT, INC.
Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements
(1) Investment Properties Acquired After September 1, 2012
On June 5, 2014, Global Medial REIT, Inc. (the “Company”, “we”, “us”, “our”) acquired a 56-bed long term acute care hospital located at 1870 S 75th Street, Omaha, Nebraska (the “Facility”) for a purchase price of $21.7 million (the “Purchase Price”). The Facility is operated by Select Specialty Hospital - Omaha, Inc. pursuant to a sublease which expires in 2022, with sublessee options to renew up to 60 years (the “operating lease”). Also, the real property where the Facility and other improvements are located is subject to a land lease with Catholic Health Initiatives, a Colorado nonprofit corporation (the “land lease”). The land lease expires in 2022 with sublessee options to renew up to 60 years. As part of our acquisition of the Facility, the Company acquired the operating lease and the land lease and will become bound by the terms and conditions of these leases.
The acquisition was funded using proceeds from a mortgage loan obtained on June 5, 2014, with Capital One, National Association $15,060,000 with a maturity on June 5, 2017 and from additional financings of $7,500,000 from a majority shareholder. The mortgage loan shall bear interest at a rate per annum equal to Four and Ninety-one hundredths of one percent (4.91%). The majority shareholder financing is unsecured, due on demand, and bears no interest.
The unaudited pro forma condensed consolidated balance sheet assumes that the acquisition occurred on February 28, 2014 and the unaudited pro forma condensed consolidated statements of operations assume that all acquisitions described above occurred on September 1, 2012.
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