Company: NXDT
Filing Date: 2025-01-21
Form Type: 424B3
Source: 0001437749-25-001494
Chunk: 2028

Company: NEXPOINT DIVERSIFIED REAL ESTATE TRUST
Filing Date: 2025-01-21
Form: 424B3
Chunk 2028
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43

I-1604

ARTICLE 10.
TAX MATTERS</div>

Section 10.1.

The Manager shall arrange for the preparation and timely filing of all returns of Company income, gains, deductions, losses and other items required of the Company for federal and state income tax purposes and shall furnish by July 31 of the year immediately following each taxable year, or as soon as reasonably practicable thereafter, the tax information reasonably required by Members for federal and state income tax reporting purposes.

Section 10.2.

Except as otherwise provided herein, the Manager shall, determine whether to make any available election pursuant to the Code. Notwithstanding the foregoing, (i) in making any such tax election the Manager and the Class A Members may, but shall be under no obligation to, take into account the tax consequences to the Members resulting from any such election, and (ii) the Company shall not make any election pursuant to Regulations Section 301.7701-3(c) to be treated as other than a partnership for U.S. federal income tax purposes and shall not make any election pursuant to Code Section 761(a) to be excluded from the provisions of Subchapter K of the Code.

Subject to , the Manager can elect to use any method permitted by Code Section 704(c) and the Regulations thereunder to take into account any variation between the adjusted basis of any property contributed (or deemed contributed) to the Company and such property’s initial Carrying Value. Subject to Section 7.1(a), the Manager shall have the right to seek to revoke any tax election it makes (including, without limitation, an election under Section 754 of the Code) upon determination that such revocation is in the best interests of the Members.

To the extent provided for in Regulations, revenue rulings, revenue procedures and/or other IRS guidance issued after the date of this Agreement, the Company is hereby authorized to, and at the direction of the Manager (subject to ) shall, elect a safe harbor under which the fair market value of any Membership Interests issued in connection with the performance of services after the effective date of such Regulations or other guidance will be treated as equal to the liquidation value of such Membership Interests (i.e., a value equal to the total amount that would be distributed with respect to such Membership Interests if the Company sold all of its assets for their fair market value immediately after the issuance of such Membership Interests, satisfied its liabilities (excluding any non-recourse liabilities to the extent the balance of such liabilities exceed