DHC Diversified Healthcare Trust

Item 1.01. Entry into a Material Definitive Agreement.

On February 14, 2023, we amended the agreement governing our credit facility, or our credit agreement, with Wells Fargo Bank, National Association, as administrative agent and a lender, and a syndicate of other lenders. Pursuant to the amendment, among other things, the waiver of the fixed charge coverage ratio covenant was extended through the maturity date of our credit facility in January 2024, the minimum liquidity requirement was decreased from $200.0 million to $100.0 million, and the facility commitments were reduced from $586.4 million to $450.0 million.

In addition, the amendment provides for certain additional financial covenants and restrictions on us, including that we are required to repay outstanding amounts under the credit facility with excess cash flow from properties that secure the credit facility and that, subject to certain exceptions, we are generally restricted from acquiring real property or incurring additional debt and our ability to pay cash distributions to our shareholders remains limited to amounts required to maintain our qualification for taxation as a REIT, to avoid the payment of income or excise taxes and to pay a dividend of $0.01 per share per quarter. The amendment also establishes the secured overnight financing rate as the replacement benchmark rate in place of LIBOR to calculate interest payable on amounts outstanding under our credit facility, increases the interest rate premium payable on borrowings under our credit facility from 250 basis points per annum to 290 basis points per annum and eliminates the feature of our credit facility permitting us to reborrow funds.

Wells Fargo Bank, National Association and the other lenders party to our credit agreement, as amended, as well as their affiliates, have engaged in, and may in the future engage in, investment banking, commercial banking, advisory and other commercial dealings in the ordinary course of business with us. They have received, and may in the future receive, customary fees and commissions for these engagements.

The foregoing description of the amendment to our credit agreement is not complete and is subject to and qualified in its entirety by reference to the copy of the fifth amendment to our amended and restated credit agreement attached as Exhibit 10.1 to this Current Report on Form 8-K, and incorporated herein by reference.

Warning Concerning Forward-Looking Statements

This Current Report on Form 8-K contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. Also, whenever we use words such as “believe”, “expect”, “anticipate”, “intend”, “plan”, “estimate”, “will”, “may” and negatives or derivatives of these or similar expressions, we are making forward-looking statements. These forward-looking statements are based upon our present intent, beliefs or expectations, but forward-looking statements are not guaranteed to occur and may not occur. Actual results may differ materially from those contained in or implied by our forward-looking statements as a result of various factors. For example:

The information contained in our filings with the SEC, including under the caption “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2021 identifies other important factors that could cause our actual results to differ materially from those stated in or implied by our forward-looking statements. Our filings with the SEC are available on the SEC’s website at www.sec.gov.

You should not place undue reliance upon forward-looking statements.

Except as required by law, we do not intend to update or change any forward-looking statements as a result of new information, future events or otherwise.