Company: NXDT
Filing Date: 2025-01-30
Form Type: 424B5
Source: 0001437749-25-002263
Chunk: 19

Company: NEXPOINT DIVERSIFIED REAL ESTATE TRUST
Filing Date: 2025-01-30
Form: 424B5
Chunk 19
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 Series B Preferred Shares or our common shares. Our Board may elect to, among other things, sell additional shares in future public offerings and issue equity interests in private offerings, or issue shares to sellers of investments or properties we directly or indirectly acquire instead of, or in addition to, cash consideration. The issuance of additional Series B Preferred Shares, Series A Preferred Shares or other preferred shares on parity with or senior to the Series A Preferred Shares and the Series B Preferred Shares would dilute the interests of the holders of Series B Preferred Shares, and any issuance of preferred shares on parity with or senior to the Series B Preferred Shares or equity or debt securities convertible into preferred shares with a distribution preference over the Series B Preferred Shares or additional indebtedness, could affect our ability to pay dividends on, redeem or pay the Stated Value on the Series B Preferred Shares. Similarly, the issuance of additional common shares or convertible or exchangeable securities, warrants or options would dilute the interests of the holders of common shares, and any issuance of securities senior to the common shares or additional indebtedness, could affect our ability to pay dividends on such common shares. Further, depending upon the terms of such transactions, most notably the offering price per share, existing shareholders may also experience a dilution in the book value of their investment in us. The issuance of common shares upon conversion or redemption of Series B Preferred Shares also may have the effect of reducing our net income per share (or decreasing our net loss per share). Shareholders have no rights to buy additional shares of beneficial interests or other securities if we issue new shares of beneficial interests or other securities.

None of the provisions relating to the Series B Preferred Shares relate to or limit our indebtedness or afford the holders of Series B Preferred Shares protection in the event of a highly leveraged or other transaction, including a merger or the sale, lease or conveyance of all or substantially all our assets or business, that might adversely affect a holder of Series B Preferred Shares.

Further, holders of preferred shares are normally entitled to receive a preference payment if we liquidate, dissolve, or wind up before any payment is made to the common shareholders, likely reducing the amount common shareholders would otherwise receive upon such an occurrence. In addition, under certain circumstances, the issuance of additional preferred shares may delay, prevent, render more difficult or tend to discourage a merger, tender offer, or proxy contest, the assumption of control by a holder of a large block of our securities, or the removal of incumbent management.

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