The recommendation followed a months-long negotiation in which the price climbed to $6.25 before being cut, and the board proceeded without a formal fairness opinion.

July 14, 2026

Selectis Health Inc. has urged its shareholders to tender their shares to an affiliate of Black Pearl Equities at $5.75 a share in cash, giving the board’s unanimous backing to a takeover of the money-losing senior care operator as the tender offer formally got under way.

The recommendation follows the merger agreement the two companies announced in June. Black Pearl launched its tender offer on July 13 and set it to expire at 5:00 p.m. New York time on August 10, subject to extension. The buyer must secure at least 70 percent of outstanding shares for the deal to proceed.

Selectis, a Utah-incorporated company traded over the counter under the symbol GBCS, owns and operates skilled nursing and senior living facilities and had roughly 3.07 million shares outstanding as of June 22. Once the offer closes, a Black Pearl merger subsidiary would absorb the company through a short-form merger under Utah law, a route that requires no shareholder vote. A top-up option lets the buyer purchase enough newly issued shares to reach the 90 percent ownership that structure requires.

A Company Under Financial Strain

The board framed the sale against a deteriorating financial picture. Selectis recorded operating losses of about $2.73 million in 2024 and $1.56 million in 2025, and lost roughly $1.26 million from operations in the first quarter of 2026. Directors concluded that without a marked turnaround the company would keep losing money and eroding shareholder value, and that neither continued independence nor a liquidation was reasonably likely to deliver more than the cash on the table.

They also weighed the familiar pressures on the skilled nursing, assisted living, and independent living business, among them:

• revenue that depends heavily on facility occupancy;
• rising operating costs;
• a heavy and complex regulatory burden; and
• the difficulty of attracting and retaining qualified facility operators.

A Year of Bargaining, and a Rare Price Cut

Getting to $5.75 took the better part of a year and an unusual reversal. Black Pearl first approached Selectis in the summer of 2025 about acquiring its Georgia properties, then floated a whole-company bid at $2.50 a share that the board did not answer. Successive proposals followed at $4.00 and then $5.05, the price of an initial tender offer the buyer commenced in March. Selectis brought on outside counsel, seated a new director as its lead negotiator, and by late March the two sides had agreed in principle on $6.25 a share, subject to a 70 percent minimum tender.

That figure did not hold. The buyer terminated the March offer, and in June, citing a drop in the company’s cash position, cut its bid to $5.00. Selectis countered at $5.75 plus a $0.50-per-share deferred payment; Black Pearl rejected the deferred piece as ill-suited to a deal of this size and timing, and the parties settled on $5.75 in straight cash.

An Appraisal Instead of a Fairness Opinion

To test the price, the board leaned on an outside appraisal rather than a Wall Street fairness opinion. Houlihan Valuation Advisors, engaged to value the company as of March 31, put its fair market value at about $18.4 million, or $5.62 a share on a fully diluted basis. The $5.75 offer sits about 2.3 percent above that mark and roughly 14 percent above the earlier $5.05 tender price. The board decided a formal fairness opinion was not worth its cost given the appraisal in hand, the drawn-out arm’s-length bargaining, and the company’s weak standalone prospects, while openly cautioning shareholders that, as a result, no bank or financial adviser has independently judged whether the price is fair from a financial standpoint.

The appraisal itself rested almost entirely on a net-asset-value analysis, because Selectis had not produced positive operating income, EBITDA, or net income in any period reviewed, which took the usual earnings-based and public-comparable methods off the table. The estimate leaned on real estate appraisals of the company’s owned properties totaling $31.1 million, then subtracted items including preferred-stock redemptions, warrant repurchases, an assumed disposition commission, wind-down operating costs, and a potential impairment tied to a facility placed on a federal regulatory watch list. The appraiser stressed that the figure was an estimate of the company’s value as a whole, not a fairness judgment on the offer, and that it predated the merger agreement.

Measured against recent trading, the offer carries a steep premium. The board pegged it at roughly 80 percent above the $3.20 close the day before the June announcement, about 25 percent over its early-May high of $4.58, and well over triple the stock’s December low, all as reported on OTC Markets, a reflection of the thin, illiquid market in the shares.

Insider Support and Payouts

Insiders are aligned with the deal. Three directors who together hold about 14 percent of the stock signed a support agreement committing their shares to the offer, barring withdrawal, and waiving appraisal rights. Company officers and directors as a group own roughly 437,000 shares and would receive the same $5.75 apiece as other holders. Beyond that, the interim chief executive is due a one-time $45,000 bonus for transitioning management at closing, and two directors received $45,000 payments each for work on the transaction. One director who holds warrants exercisable at $2.25 a share would net an additional sum if he exercises and tenders.

Financing, Conditions, and Regulatory Hurdles

The offer carries no financing condition. Black Pearl’s purchasing entity holds a signed commitment for up to about $18 million in debt from two lenders, Milrose Capital and SCG Experts Corp., to fund the purchase. Either side would owe a $400,000 termination fee under specified circumstances, and Selectis retains a limited ability to consider an unsolicited superior proposal. The deal also hinges on holders exercising appraisal rights not exceeding 15 percent of outstanding shares, a threshold the buyer may waive at its discretion.

Completing the transaction will require Oklahoma health regulators to clear a transfer of the licenses behind the company’s skilled nursing operations in that state. The agreement contemplates a court-appointed receiver to keep those facilities running in the ordinary course until the buyer obtains the permits it needs to take control. Selectis, for its part, sold its two remaining Georgia facilities on May 1 for $15.7 million, a move that reshaped its balance sheet in the middle of the negotiations and factored into the buyer’s late price cut.

Selectis expects little time to pass between the close of the offer and completion of the merger. Shareholders who decline to tender would keep statutory appraisal rights under Utah law, though the value ultimately determined for their shares could come in above, at, or below the offer price.