<SEC-DOCUMENT>0000921895-23-001461.txt : 20230608
<SEC-HEADER>0000921895-23-001461.hdr.sgml : 20230608
<ACCEPTANCE-DATETIME>20230608160936
ACCESSION NUMBER:		0000921895-23-001461
CONFORMED SUBMISSION TYPE:	DFAN14A
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20230608
DATE AS OF CHANGE:		20230608

SUBJECT COMPANY:	

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			DIVERSIFIED HEALTHCARE TRUST
		CENTRAL INDEX KEY:			0001075415
		STANDARD INDUSTRIAL CLASSIFICATION:	REAL ESTATE INVESTMENT TRUSTS [6798]
		IRS NUMBER:				043445278
		STATE OF INCORPORATION:			MD
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		DFAN14A
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-15319
		FILM NUMBER:		231001976

	BUSINESS ADDRESS:	
		STREET 1:		C/O THE RMR GROUP
		STREET 2:		TWO NEWTON PL., 255 WASH. ST., STE. 300
		CITY:			NEWTON
		STATE:			MA
		ZIP:			02458
		BUSINESS PHONE:		(617) 796-8350

	MAIL ADDRESS:	
		STREET 1:		C/O THE RMR GROUP
		STREET 2:		TWO NEWTON PL., 255 WASH. ST., STE. 300
		CITY:			NEWTON
		STATE:			MA
		ZIP:			02458

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	SENIOR HOUSING PROPERTIES TRUST
		DATE OF NAME CHANGE:	19981217

FILED BY:		

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			Flat Footed LLC
		CENTRAL INDEX KEY:			0001799456
		IRS NUMBER:				813307959
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		DFAN14A

	BUSINESS ADDRESS:	
		STREET 1:		3465 N PINES WAY
		STREET 2:		SUITE 104 BOX 206
		CITY:			WILSON
		STATE:			WY
		ZIP:			83014
		BUSINESS PHONE:		9174397926

	MAIL ADDRESS:	
		STREET 1:		3465 N PINES WAY
		STREET 2:		SUITE 104 BOX 206
		CITY:			WILSON
		STATE:			WY
		ZIP:			83014
</SEC-HEADER>
<DOCUMENT>
<TYPE>DFAN14A
<SEQUENCE>1
<FILENAME>dfan14a13837002_06082023.htm
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<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>UNITED
STATES</B></FONT></P>

<P STYLE="font: 12pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>SECURITIES
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; text-align: center; margin-bottom: 0">INFORMATION REQUIRED IN PROXY STATEMENT</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; text-align: center; margin-bottom: 0">SCHEDULE 14A INFORMATION</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">(Amendment No. )</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Filed by the Registrant &#9744;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Filed by a Party other than the Registrant &#9746;</P>

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<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">&#9744;</TD><TD>Preliminary Proxy Statement</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top"><TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">&#9744;</TD><TD>Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))</TD></TR></TABLE>



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<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top"><TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">&#9744;</TD><TD>Definitive Proxy Statement</TD></TR></TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top"><TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">&#9744;</TD><TD>Definitive Additional Materials</TD></TR></TABLE>



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<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0"><TR STYLE="vertical-align: top"><TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">&#9746;</TD><TD>Soliciting Material Under &sect; 240.14a-12</TD></TR></TABLE>



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    <TD STYLE="width: 100%; text-align: center; vertical-align: top; border-bottom: Black 0.5pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">DIVERSIFIED HEALTHCARE TRUST</P>
</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="text-align: center; vertical-align: top"><P>(Name of Registrant as Specified In Its Charter)</P>

</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD></TR>
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    <TD STYLE="text-align: center; vertical-align: top; border-bottom: Black 0.5pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">FLAT FOOTED, LLC</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">MARC ANDERSEN</P>
</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="text-align: center; vertical-align: top"><P>(Name of Persons(s) Filing Proxy Statement, if other than the Registrant)</P>

</TD></TR>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 12pt; text-align: justify; text-indent: 0.5in">Flat Footed LLC, a Delaware
limited liability company (&ldquo;Flat Footed&rdquo;), together with the other participants named herein, has filed a preliminary proxy
statement and accompanying <B>GOLD</B> proxy card with the Securities and Exchange Commission (&ldquo;SEC&rdquo;) to be used to solicit
votes in connection with its opposition to proposals to be presented at the special meeting of shareholders of Diversified Healthcare
Trust, a Maryland corporation (the &ldquo;Company&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 12pt; text-align: justify; text-indent: 0.5in">On June 8, 2023, Flat Footed
issued the following press release:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Flat Footed LLC Files Preliminary Proxy Statement
Opposing Diversified Healthcare Trust&rsquo;s Proposed Merger with Office Properties Income Trust</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt/105% Times New Roman, Times, Serif; margin: 0 0 8pt; text-align: center"><B><I>Announces Intent to Solicit Proxies
<U>AGAINST</U> the Proposed Merger with OPI, Which Dramatically Undervalues DHC and Enriches the Conflicted External Manager, RMR Group,
at DHC Shareholders&rsquo; Expense</I></B></P>

<P STYLE="font: 10pt/105% Times New Roman, Times, Serif; margin: 0 0 8pt; text-align: center"><B><I>Believes There are Vastly Superior
Alternatives to Address the Company&rsquo;s Near-Term Debt Maturities and Ultimately Maximize Value for DHC Stakeholders</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">WILSON, Wyo.--(BUSINESS WIRE)--Flat Footed LLC (together
with its affiliates, &ldquo;FFL&rdquo; or &ldquo;we&rdquo;) is a top shareholder of Diversified Healthcare Trust (Nasdaq: DHC) (&ldquo;DHC&rdquo;
or the &ldquo;Company&rdquo;) and the owner of approximately 9.4% of the outstanding common shares of the Company. Today, FFL announced
that it has filed a preliminary proxy statement with the Securities and Exchange Commission (&ldquo;SEC&rdquo;) in connection with its
opposition to proposals to be presented at the special meeting of shareholders of DHC (the &ldquo;Special Meeting&rdquo;) relating to
the Company&rsquo;s proposed merger with Office Properties Income Trust (Nasdaq: OPI) (&ldquo;OPI&rdquo;). The preliminary proxy statement
is available on the SEC&rsquo;s website <FONT STYLE="color: #0563C1">here</FONT>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">DHC&rsquo;s Board of Trustees (the &ldquo;Board&rdquo;)
has not responded to FFL&rsquo;s <FONT STYLE="color: #0563C1">May 23<SUP>rd</SUP> letter</FONT>, highlighting the numerous reasons why
FFL believes DHC shareholders should reject the proposed merger with OPI. The Board has also failed to respond to any of FFL&rsquo;s <FONT STYLE="color: #0563C1">merger-related
questions</FONT> raised ahead of the Company&rsquo;s Annual Meeting of Shareholders on June 5<SUP>th</SUP>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">At the Special Meeting, which has yet to be scheduled,
FFL intends to vote its DHC shares <B><U>AGAINST</U></B> the proposed merger with OPI, as well as the adjournment proposal, to protect
the long-term value and interests of all Company stakeholders. <B><U>FFL&rsquo;s preliminary proxy statement details its serious concerns
with DHC&rsquo;s value-destructive proposed merger with OPI, including FFL&rsquo;s belief that:</U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

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<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&#183;</FONT></TD><TD STYLE="text-align: justify"><B>The proposed merger dramatically undervalues DHC.</B> DHC&#8217;s high-quality assets, including its
senior housing operating portfolio, are worth at least $5 billion and support trading prices between $9 and $10 per share. Therefore,
the proposed merger&#8217;s contemplated $1.13 per share takeover price represents nearly an 89% discount to DHC&#8217;s intrinsic value.
It is also dramatically lower than the all-cash $4 per share bid rejected by this same Board as &#8220;inadequate&#8221; in May 2022.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in; text-align: justify">&nbsp;</P>

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<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&#183;</FONT></TD><TD STYLE="text-align: justify"><B>The proposed merger&#8217;s 0.147x exchange ratio is based on an artificially inflated OPI share price.</B>
Had the companies negotiated the transaction based on (1) trading prices reflecting OPI&#8217;s dividend cut, which was announced the
same day as the proposed merger announcement, and (2) DHC&#8217;s $5 billion asset value, the exchange ratio would be substantially higher
in favor of DHC shareholders. OPI openly expects to record a $3.5 billion gain from this lopsided merger transaction.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><SUP>1</SUP></FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><SUP>1</SUP></FONT> The Form S-4/A for the proposed merger filed by OPI on June 7, 2023 supports our view, disclosing that OPI expects to receive approximately $3.79 billion of DHC assets in exchange for just $218.4 million in consideration.</P>

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<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&#183;</FONT></TD><TD STYLE="text-align: justify"><B>DHC&#8217;s own projections indicate that senior housing properties are set for a sizeable rebound.</B>
In 2024 and 2025, DHC expects to outperform its 2023 consolidated Net Operating Income by 55% and 101%, respectively, primarily driven
by a sharp recovery in its senior housing operating portfolio. Yet, the fairness opinion DHC relies upon to justify the insufficient takeover
price improperly uses <FONT STYLE="letter-spacing: -0.2pt">severely depressed 2023 EBITDA, effectively ignoring the Company&#8217;s bright
future as evidenced by its own projections.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in">&nbsp;</P>

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<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&#183;</FONT></TD><TD STYLE="text-align: justify"><P STYLE="margin-top: 0; margin-bottom: 0"><B>DHC
Managing Trustee and The RMR Group LLC (&ldquo;RMR&rdquo;) Chief Executive Officer Adam D. Portnoy&rsquo;s recent purchases of DHC stock
suggest a higher valuation than the proposed merger. </B>Mr. Portnoy recently bought DHC stock at a 48% premium <FONT STYLE="letter-spacing: -0.2pt">to
what DHC shareholders are being asked to accept in the proposed merger.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><SUP>2</SUP></FONT></FONT></P></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in"><B>&nbsp;</B></P>

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<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&#183;</FONT></TD><TD STYLE="text-align: justify"><B>DHC should not be saddled with OPI&#8217;s failing commercial office property assets and deteriorating
balance sheet.</B> Relative to other office REITs, OPI is more negatively exposed due to its focus on single-tenant buildings, which leads
to an inability to counter tenant downsizing and to tenant leverage in negotiating lease terms, tenant improvements, and owner-funded
capital expenditures. Equally troubling, OPI has bonds at coupon rates of 2% to 4% maturing in 2024-2027, with $1 billion of these bonds
coming due in the next 19 months.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><SUP>3</SUP></FONT> These
bonds currently trade at distressed levels, indicating that OPI will struggle to refinance its bonds absent the merger.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in">&nbsp;</P>

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<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&#183;</FONT></TD><TD STYLE="text-align: justify"><B>The
                                            proposed merger terms benefit OPI and RMR&ndash; at DHC&rsquo;s direct expense.</B> OPI will
                                            gain access to DHC&rsquo;s valuable assets from which it will seek to raise $1 billion in
                                            government-sponsored enterprise debt, offset its declining cash flows, and stave off an otherwise
                                            likely bankruptcy filing. At the same time, <FONT STYLE="letter-spacing: -0.15pt">RMR, which
                                            is the external manager for both REITs, </FONT>will continue to collect <I>significant fees
                                            </I>as the external manager for the post-merger entity despite disastrous results for DHC
                                            shareholders under RMR&rsquo;s stewardship over the past several years<FONT STYLE="letter-spacing: -0.1pt">.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in">&nbsp;</P>

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<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&#183;</FONT></TD><TD STYLE="text-align: justify"><B>DHC&#8217;s recent &#8220;going concern&#8221; assertions are a red herring.</B> The Company&#8217;s
 &#8220;going concern&#8221; disclosures were not made until <I>after</I> the proposed merger was announced and <I>after</I> the Company
became &#8220;aware that several law firms have indicated that they are investigating the [proposed] merger and related matters&#8230;.&#8221;
This hardly seems to be a coincidence, especially considering RMR told investors in a March 2023 presentation that its management fees
derived from DHC &#8211; projected largely on the Company&#8217;s ability to satisfy its debt &#8211; are safe.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in">&nbsp;</P>

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<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&#183;</FONT></TD><TD STYLE="text-align: justify"><B>There are no strategic, cost-saving merits or synergies to the proposed merger.</B> <FONT STYLE="letter-spacing: -0.2pt">Estimated
synergies from the proposed merger are a mere $3 million, or 0.22% of the combined company expenses.<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><SUP>4</SUP></FONT>
This cements the complete lack of financial rationale for the transaction, other than enriching RMR, OPI, and the respective company&rsquo;s
advisors. </FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 0 0.5in">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><SUP>2</SUP></FONT> <I>See</I> Form 4 filed by Adam D. Portnoy for DHC (June 6, 2023); Form 4 filed by Adam D. Portnoy for DHC (June 1, 2023). Calculated based on the weighted average daily premium for purchases made by Mr. Portnoy from May 30, 2023 &ndash; June 6, 2023.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><SUP>3</SUP></FONT> <I>See</I> OPI &amp; DHC Merger Joint Conference Call Script at page 7; Form 10-Q for the quarterly period ending March 31, 2023, Office Properties Income Trust at page 17.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><SUP>4</SUP></FONT> Form S-4/A for the proposed merger filed by OPI on June 7, 2023.</P>

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<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&#183;</FONT></TD><TD STYLE="text-align: justify"><B>DHC has vastly superior alternatives for addressing its 2024 debt maturities.</B> <FONT STYLE="letter-spacing: -0.2pt">DHC&#8217;s
$450 million revolving credit facility lenders are, per the Company&#8217;s financial statements, supported by over $1 billion in collateral,
so an extension of the revolver past January 2024 should be readily achievable &#8211; just as it has been in the past. DHC&#8217;s $250
million note maturity can be easily addressed through targeted asset sales including, but not limited to: 27 senior housing facilities
under triple net lease valued at ~$267 million, wellness centers, including six Life Time Fitness facilities valued at ~$160 million,
and equity stakes in two joint ventures that DHC carries on its balance sheet, valued at ~$153 million.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">In advance of the Special Meeting, FFL intends to
file a definitive proxy statement and send proxy materials to DHC shareholders. Shareholders are not required to take any action at this
time.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">***</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><U>About Flat Footed</U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Flat Footed LLC is a special situation, value-oriented
investment management firm focused on leveraged, asset-heavy companies with complex capital structures. The Flat Footed LLC team has cumulatively
managed $2.8 billion since founding their first fund together in 1999. For more information, visit <FONT STYLE="color: #0563C1">www.flatfootedllc.com</FONT>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B>CERTAIN INFORMATION CONCERNING THE PARTICIPANTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Flat Footed LLC, a Delaware limited liability company
(&ldquo;Flat Footed&rdquo;), together with the other participants named herein, has filed a preliminary proxy statement and accompanying
GOLD proxy card with the Securities and Exchange Commission (&ldquo;SEC&rdquo;) to be used to solicit votes in connection with its opposition
to proposals to be presented at the special meeting of shareholders of Diversified Healthcare Trust, a Maryland corporation (the &ldquo;Company&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">FLAT FOOTED STRONGLY ADVISES ALL SHAREHOLDERS OF THE
COMPANY TO READ THE PROXY STATEMENT AND OTHER PROXY MATERIALS AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION.
SUCH PROXY MATERIALS WILL BE AVAILABLE AT NO CHARGE ON THE SEC&rsquo;S WEB SITE AT HTTP://WWW.SEC.GOV. IN ADDITION, THE PARTICIPANTS IN
THIS PROXY SOLICITATION WILL PROVIDE COPIES OF THE PROXY STATEMENT WITHOUT CHARGE, WHEN AVAILABLE, UPON REQUEST. REQUESTS FOR COPIES SHOULD
BE DIRECTED TO THE PARTICIPANTS&rsquo; PROXY SOLICITOR.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">The participants in the proxy solicitation are Flat
Footed and Marc Andersen.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">As of the date hereof, the participants in the proxy
solicitation beneficially own 22,439,900 common shares of beneficial interest, $0.01 par value per share, of the Company (the &ldquo;DHC
Common Shares&rdquo;). As of the date hereof, as the investment manager of FF Hybrid LP, GP Recovery Fund LLC and Flat Footed Series LLC
(collectively, the &ldquo;Funds&rdquo;), Flat Footed may be deemed to beneficially own the 22,439,900 DHC Common Shares held by the Funds.
Mr. Andersen, as the Managing Member of Flat Footed, may be deemed to beneficially own the 22,439,900 DHC Common Shares held by the Funds.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">***</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"><B><U>Contacts</U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For Investors:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Flat Footed LLC</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; color: #0563C1">ir@flatfootedllc.com</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Okapi Partners LLC</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Mark Harnett</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">(212) 297-0720</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; color: #0563C1">mharnett@okapipartners.com</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">For Media:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Longacre Square Partners</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify">Greg Marose / Charlotte Kiaie, 646-386-0091</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: justify; color: #0563C1">FFL@longacresquare.com</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">###</P>



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