Sec Form 13D Filing - Flat Footed LLC filing for DIVERSIFIED HEALTHCARE TRUST 5 (DHCNI) - 2023-06-07

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

(Rule 13d-101)

INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT

TO § 240.13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO

§ 240.13d-2(a)

(Amendment No. 1)¹

Diversified Healthcare Trust

(Name of Issuer)

Common Shares of Beneficial Interest, $0.01 par value per share

(Title of Class of Securities)

25525P107

(CUSIP Number)

LAURA ARNOLD

FLAT FOOTED LLC

3415 North Pines Way

Suite 205

Wilson, Wyoming 83014

(917) 439-7926

 

SEAN E. O’DONNELL

CHRISTOPHER CARTY

HERRICK, FEINSTEIN LLP

Two Park Avenue

New York, New York 10016

(212) 592-1500

 

ANDREW M. FREEDMAN

OLSHAN FROME WOLOSKY LLP

1325 Avenue of the Americas

New York, New York 10019

(212) 451-2300

(Name, Address and Telephone Number of Person

Authorized to Receive Notices and Communications)

 

June 5, 2023

(Date of Event Which Requires Filing of This Statement)

 

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box ¨.

Note:  Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits.  See § 240.13d-7 for other parties to whom copies are to be sent.

 

 

1              The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

	1		NAME OF REPORTING PERSON
				FLAT FOOTED LLC
	2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP															(a) ☐
																		(b) ☐
	3		SEC USE ONLY
	4		SOURCE OF FUNDS
				AF
	5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)															☐
	6		CITIZENSHIP OR PLACE OF ORGANIZATION
				DELAWARE
NUMBER OF				7		SOLE VOTING POWER
SHARES
BENEFICIALLY							- 0 -
OWNED BY				8		SHARED VOTING POWER
EACH
REPORTING							22,439,900
PERSON WITH				9		SOLE DISPOSITIVE POWER
							- 0 -
				10		SHARED DISPOSITIVE POWER
							22,439,900
	11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
				22,439,900
	12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES															☐
	13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
				9.4%
	14		TYPE OF REPORTING PERSON
				IA, OO, HC

  

	1		NAME OF REPORTING PERSON
				MARC ANDERSEN
	2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP															(a) ☐
																		(b) ☐
	3		SEC USE ONLY
	4		SOURCE OF FUNDS
				AF
	5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)															☐
	6		CITIZENSHIP OR PLACE OF ORGANIZATION
				USA
NUMBER OF				7		SOLE VOTING POWER
SHARES
BENEFICIALLY							- 0 -
OWNED BY				8		SHARED VOTING POWER
EACH
REPORTING							22,439,900
PERSON WITH				9		SOLE DISPOSITIVE POWER
							- 0 -
				10		SHARED DISPOSITIVE POWER
							22,439,900
	11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
				22,439,900
	12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES															☐
	13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
				9.4%
	14		TYPE OF REPORTING PERSON
				IN, HC

  

The following constitutes Amendment No. 1 to the Schedule 13D filed by the undersigned (“Amendment No. 1”). This Amendment No. 1 amends the Schedule 13D as specifically set forth herein. Capitalized terms used but not otherwise defined herein have the meanings ascribed to such terms in the Schedule 13D.

Item 2.

Identity and Background.

Item 2(a) is hereby amended and restated to read as follows:

(a)

This statement is filed by:

(i)

Flat Footed LLC, a Delaware limited liability corporation (“Flat Footed”), as the investment manager to FF Hybrid LP, GP Recovery Fund LLC and Flat Footed Series LLC (collectively, the “Funds”) with respect to the Shares directly owned by the Funds; and

(ii)

Marc Andersen, as the Managing Member of Flat Footed.

Item 3.

Source and Amount of Funds or Other Consideration.

Item 3 is hereby amended to read as follows:

The Shares beneficially owned by the Funds were purchased with working capital (which may, at any given time, include margin loans made by brokerage firms in the ordinary course of business). The aggregate purchase price of the 22,439,900 Shares beneficially owned by the Funds is approximately $29,410,743, including brokerage commissions.

Item 4.

Purpose of Transaction.

Item 4 is hereby amended to add the following:

 

Flat Footed intends to file a preliminary proxy statement with the Securities and Exchange Commission in furtherance of soliciting proxies to reject the Issuer’s proposal to approve the proposed merger (the “Proposed Merger”) between the Issuer and Office Properties Income Trust (“OPI”) at the Issuer’s upcoming special meeting of stockholders.

 

The Reporting Persons believe the Proposed Merger is ill-advised and not in the best interests of the Issuer’s stockholders. In the Reporting Persons’ view, the Proposed Merger dramatically undervalues the Issuer’s assets and growth potential, would saddle the Issuer with OPI’s failing commercial office property assets and would result in a disproportionate benefit to OPI and The RMR Group LLC, the external manager for both the Issuer and OPI, to the detriment of the Issuer and its stockholders. The Reporting Persons believe that the best path forward for the Issuer is as a standalone business and that by simply selling a small portion of its assets, the Issuer would be well-positioned to maximize long-term value for all of the Issuer’s stakeholders.

 

Item 5.

Interest in Securities of the Issuer.

The aggregate percentage of Shares reported owned by each person named herein is based upon 239,682,467 Shares outstanding as of May 3, 2023, which is the total number of Shares outstanding as reported in the Issuer’s Quarterly Report on Form 10-Q, filed with the Securities and Exchange Commission on May 8, 2023.

A.

Flat Footed

(a)

As the investment manager of the Funds, Flat Footed may be deemed to beneficially own the 22,439,900 Shares held by the Funds.

Percentage: Approximately 9.4%

(b)

1. Sole power to vote or direct vote: 0 2. Shared power to vote or direct vote: 22,439,900 3. Sole power to dispose or direct the disposition: 0 4. Shared power to dispose or direct the disposition: 22,439,900

(c)

The transactions in the Shares by Flat Footed through the Funds since the filing of the Schedule 13D are set forth in Schedule A and are incorporated herein by reference.

B.

Mr. Andersen

(a)

As the Managing Member of Flat Footed, Mr. Andersen may be deemed to beneficially own the 22,439,900 Shares held by the Funds.

Percentage: Approximately 9.4%

(b)

1. Sole power to vote or direct vote: 0 2. Shared power to vote or direct vote: 22,439,900 3. Sole power to dispose or direct the disposition: 0 4. Shared power to dispose or direct the disposition: 22,439,900

(c)

Mr. Andersen has not entered into any transactions in the Shares since the filing of the Schedule 13D. The transactions in the Shares by Flat Footed through the Funds since the filing of the Schedule 13D are set forth in Schedule A and are incorporated herein by reference.

SIGNATURES

 

After reasonable inquiry and to the best of his knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.

Dated: June 7, 2023

	Flat Footed LLC
	By:	/s/ Marc Andersen
		Name:	Marc Andersen
		Title:	Managing Member

 

 

	/s/ Marc Andersen
	Marc Andersen

 

SCHEDULE A

Transactions in the Securities of the Issuer Since the Filing of the Schedule 13D

Nature of the Transaction

Amount of Securities Purchased/(Sold)

Price ($)

Date of Purchase/Sale

 

FLAT FOOTED LLC

(through the Funds)

 

Purchase of Common Shares	175,000	1.2025	05/23/2023
Purchase of Common Shares	175,000	1.0971	05/24/2023
Purchase of Common Shares	495,000	1.3749	05/31/2023
Purchase of Common Shares	445,000	1.4587	06/01/2023
Purchase of Common Shares	120,836	1.6192	06/01/2023
Purchase of Common Shares	980,000	1.6819	06/02/2023
Purchase of Common Shares	1,000,000	1.7507	06/05/2023
Purchase of Common Shares	816,012	1.8429	06/06/2023
Purchase of Common Shares	14,423	1.9831	06/06/2023
Purchase of Common Shares	548,994	2.3013	06/07/2023