REGIONAL HEALTH PROPERTIES, INC

The Company is party to various legal actions and administrative proceedings that have arisen in the ordinary course of business, including matters relating to prior direct facility operations, current operated facilities, employment matters, staffing-related matters, commercial disputes and other business matters. Litigation and administrative proceedings are inherently uncertain, and there can be no assurance that the resolution of any such matters will not have a material adverse effect on the Company’s business, financial condition or results of operations.

In addition, because the Company owns healthcare properties and in some cases operates facilities directly, and because its tenants and operators conduct business in a highly regulated industry, the Company may from time to time be affected by governmental inquiries, audits, surveys, investigations and other proceedings involving patient care, reimbursement, licensure, labor matters and regulatory compliance.

Certain legal matters, including professional and general liability claims and other contingencies, are described in Note 15 – Commitments and Contingencies to the audited consolidated financial statements included in Part II, Item 8, “Financial Statements and Supplementary Data,” of this Annual Report, and that disclosure is incorporated herein by reference. See also Part I, Item 1A, “Risk Factors,” for a discussion of risks relating to litigation, regulatory matters and other contingencies.