Company: NXDT
Filing Date: 2025-04-25
Form Type: 424B3
Source: 0001437749-25-013177
Chunk: 153

Company: NEXPOINT DIVERSIFIED REAL ESTATE TRUST
Filing Date: 2025-04-25
Form: 424B3
Chunk 153
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 as a “related party tenant.” |

| ● | Third, if rent attributable to personal property leased in connection with a lease of real property is greater than 15% of the total rent received under the lease, then the portion of rent attributable to the personal property will not qualify as rents from real property. |

| ● | Finally, for rents received to qualify as rents from real property, except as described below, New NXDT generally must not operate or manage the property or furnish or render services to the tenants of the property, other than through an independent contractor from whom New NXDT derives no revenue or through a TRS. However, New NXDT may directly perform certain services that landlords usually or customarily render when renting space for occupancy only or that are not considered rendered to the occupant of the property. |

New NXDT may directly perform services for some of its tenants. New NXDT does not believe that the provision of these services will cause its gross income attributable to these tenants to fail to be treated as rents from real property. If New NXDT were to provide services to a tenant of a property of New NXDT other than those services landlords usually or customarily provide to tenants of properties of a similar class in the same geographic market when renting space for occupancy only, amounts received or accrued by New NXDT for any of these services will not be treated as rents from real property for purposes of the REIT gross income tests. However, the amounts received or accrued for these services will not cause other amounts received with respect to the property to fail to be treated as rents from real property unless the amounts treated as received in respect of the service (valued at no less than 150% of the direct cost of providing such service), together with amounts received for certain management services, exceed 1% of all amounts received or accrued by New NXDT during the taxable year with respect to the property. If the sum of the amounts received in respect of the services to tenants and management services described in the preceding sentence exceeds the 1% threshold, then all amounts received or accrued by New NXDT with respect to the property will not qualify as rents from real property, even if New NXDT provides the impermissible service to some, but not all, of the tenants of the property.

New NXDT may directly or indirectly receive distributions from TRSs or other corporations that are not REITs or qualified REIT subsidiaries. These distributions generally are treated as dividend income to the extent of the earnings and profits of the distributing corporation. Such distributions