Company: NXDT
Filing Date: 2025-01-21
Form Type: 424B3
Source: 0001437749-25-001494
Chunk: 54

Company: NEXPOINT DIVERSIFIED REAL ESTATE TRUST
Filing Date: 2025-01-21
Form: 424B3
Chunk 54
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 process. During the deliberations, the Special Committee discussed the fact that (i) NXDT had confirmed it was not prepared to pursue any alternative transactions that would result in the selling of its interest in the REIT or the acquisition by a third party of the Units that NXDT does not already own, and (ii) the REIT had marketed several of the properties with no portfolio or third party interest, and determined that it was highly unlikely that a competing offer for equal or greater consideration could emerge. In addition, due to the high leverage of the REIT, there were limited possibilities for a recapitalization.

On October 17, 2024, the REIT engaged BakerHostetler LLP to act as U.S. counsel in respect of the Proposed Transaction. It was also agreed that Winston would act as U.S. tax deal counsel given their familiarity and prior dealings with the REIT.

At a meeting held on October 29, 2024, the Special Committee met with Goodmans and Doane Grant Thornton to further evaluate the Proposed Transaction. The Special Committee, with the assistance of its advisors, reviewed the relative benefits and risks associated with the Proposed Transaction as compared to the status quo, including the factors set out below. Following discussion, the Special Committee determined that it would be prepared to proceed with the Proposed Transaction on the terms presented by NXDT, subject to receiving Doane Grant Thornton’s Fairness Opinion, satisfactory negotiation of definitive documentation in respect of the Proposed Transaction and approval of the Proposed Transaction by the Board. The Special Committee considered various strategic opportunities and alternatives for the REIT, including: (i) the possible transition in the strategy of the REIT; (ii) individual sales of the REIT’s hospitality assets and a liquidation of the REIT; and (iii) the Proposed Transaction, and ultimately determined that an en bloc sale under the Proposed Transaction would be most effective in maximizing Unitholder value.

On November 6, 2024, the Special Committee met with Goodmans to discuss the draft Merger Agreement and any open points. The Special Committee provided their feedback on various deal points. Between November 6, 2024 and November 20, 2024, the Special Committee and its legal and financial advisors, with the assistance of NXDT’s legal advisors, finalized the terms of the definitive documentation for the Proposed Transaction.

On November 22, 2024, the Special Committee met with Doane Grant Thornton and Goodmans. Doane Grant Thornton made a presentation to the Special Committee