Company: NXDT
Filing Date: 2025-04-11
Form Type: S-4
Source: 0001437749-25-011826
Chunk: 162

Company: NEXPOINT DIVERSIFIED REAL ESTATE TRUST
Filing Date: 2025-04-11
Form: S-4
Chunk 162
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 75% asset test are subject to the additional asset tests described below. |

| ● | Second, of the investments not included in the 75% asset class, the value of any one issuer’s securities owned by New NXDT may not exceed 5% of the value of New NXDT’s total assets. |

| ● | Third, of the assets not included in the 75% asset class, New NXDT may not own more than 10% of the vote or value of the outstanding securities of any one issuer. |

| ● | Fourth, not more than 20% of New NXDT’s total assets may constitute securities issued by TRSs. |

| ● | Fifth, not more than 25% of the value of New NXDT’s total assets may be represented by debt instruments issued by publicly offered REITs to the extent not secured by real property or interests in real property. |

For purposes of the 5% and 10% asset tests described in the second and third bullets above, the term “securities” does not include stock in another REIT, equity or debt securities of a qualified REIT subsidiary or TRS, or equity interests in a partnership.

Additionally, solely for the purposes of the 10% value test described in the third bullet above, the determination of New NXDT’s interest in the assets of any partnership or limited liability company in which New NXDT owns an interest will be based on New NXDT’s proportionate interest in any securities issued by the partnership or limited liability company, excluding for this purpose certain securities described in the Code.

For purposes of the 10% value test, the term “securities” does not include:

| ● | “Straight debt” securities, which is defined as a written unconditional promise to pay on demand or on a specified date a sum certain in money if (i) the debt is not convertible, directly or indirectly, into stock, and (ii) the interest rate and interest payment dates are not contingent on profits, the borrower’s discretion, or similar factors. “Straight debt” securities do not include any securities issued by a partnership or a corporation in which we or any controlled TRS (i.e., a TRS in which New NXDT owns directly or indirectly more than 50% of the voting power or value of the stock) hold non-“straight debt” securities that have an aggregate value of more than 1% of the issuer’s outstanding securities. However, “straight debt” securities include debt subject to the