Company: NXDT
Filing Date: 2025-01-30
Form Type: 424B5
Source: 0001437749-25-002263
Chunk: 17

Company: NEXPOINT DIVERSIFIED REAL ESTATE TRUST
Filing Date: 2025-01-30
Form: 424B5
Chunk 17
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 the Series B Preferred Shares, you may only be able to sell them at a substantial discount from the price you paid. Therefore, you should purchase the Series B Preferred Shares only as a long-term investment.

Beginning on the first day of the month following the third anniversary of the date of original issuance of any Series B Preferred Shares, upon a Minimum Market Price Trigger, the holder thereof may require us to convert such shares to our common shares. Beginning on the first day of the month following the original issuance of any Series B Preferred Shares, the holder thereof may require us to redeem such shares, and beginning on the first day of the first quarter following the second anniversary of the date of original issuance, we may redeem, any such share, in each case with the redemption price payable, in our sole discretion, in cash or in equal value of common shares, based on the closing price per share of our common shares for the single trading day prior to the date of redemption. If a holder exercises its conversion right or we opt to pay the redemption price in common shares, holders of Series B Preferred Shares will receive publicly traded shares. However, there is no guarantee that a Minimum Market Price Trigger will occur, or that we will elect to redeem any Series B Preferred Shares pursuant to our option, and in addition, there are aggregate limits per calendar month, fiscal quarter and fiscal year that apply to conversions and redemptions of shares of Series B Preferred Shares that a holder my require us to complete. See “Description of Series B Preferred Shares—Redemption at Option of Holders” and “Description of Series B Preferred Shares—Conversion at Option of Holders” in this prospectus supplement for additional information.

Because we conduct substantially all of our operations through the OP, our ability to pay dividends on our Series B Preferred Shares depends almost entirely on the distributions we receive from the OP. We may not be able to pay dividends regularly on our Series B Preferred Shares.

We may not be able to pay dividends on a regular basis in the future on our Series B Preferred Shares. We intend to contribute the entire net proceeds from this offering to our OP in exchange for Series B Preferred Units that have substantially the same economic terms as the Series B Preferred Shares. Because we conduct substantially all of our operations through our OP, our ability to pay dividends on the Series B Preferred Shares will depend almost entirely on payments and distributions we receive on our interests in the OP. If the OP fails to operate profitably and to generate sufficient cash from operations (and the operations of its subsidiaries), we