Company: NXDT
Filing Date: 2025-01-21
Form Type: 424B3
Source: 0001437749-25-001494
Chunk: 99

Company: NEXPOINT DIVERSIFIED REAL ESTATE TRUST
Filing Date: 2025-01-21
Form: 424B3
Chunk 99
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 under certain circumstances, the REIT may be required to pay the Termination Fee. See “The Merger Agreement – Termination Provisions”.

Restrictions on the REIT’s ability to solicit Company Acquisition Proposals from other potential purchasers

While the terms of the Merger Agreement permit the REIT to consider other proposals, the Merger Agreement restricts the REIT from soliciting third parties to make a Company Acquisition Proposal. Further, the Merger requires that in order to constitute a Superior Proposal, among other conditions, such Company Acquisition Proposal must result in a transaction more favourable from a financial point of view to Unitholders than the Transaction. See “The Merger Agreement – Non-Solicitation Covenants”.

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The Company Termination Fee may discourage other parties from proposing a significant business transaction with the REIT

Pursuant to the Merger Agreement, the REIT is required to pay NXDT the Company Termination Fee in the event the Merger Agreement is terminated following the occurrence of certain events, including a Superior Proposal. The Company Termination Fee may discourage other parties from participating in a transaction with the REIT. See “The Merger Agreement – Termination Provisions”.

Conduct of the REIT’s business

Under the Merger Agreement, the REIT must generally conduct its business in the ordinary course, and the REIT is, prior to the completion of the Transaction or the termination of the Merger Agreement, subject to ordinary course of business covenants requiring the prior consent of NXDT to carry out certain actions, which may delay or prevent the REIT from pursuing business opportunities that may arise or preclude actions that would otherwise be advisable if the REIT were to remain a publicly traded issuer. See “The Merger Agreement – Conduct of Activities and Business of the Company”.

No continued benefit of Unit ownership for Unitholders that elect cash

The Transaction will result in the REIT no longer existing as a publicly-traded issuer and as such, Unitholders who elect to receive cash will not benefit from any appreciation in the value of, or distributions on, their Units after the completion of the Transaction.

After a Unitholder has made an election in respect of their Units, they will not be able to sell those Units unless they revoke their election prior to the election deadline.

To be effective, a form of election must be properly completed, signed and submitted to the Depositary by 10:00 a.m. (Toronto time), on February 18