Company: NXDT
Filing Date: 2025-06-12
Form Type: S-4
Source: 0001437749-25-020201
Chunk: 21

Company: NEXPOINT DIVERSIFIED REAL ESTATE TRUST
Filing Date: 2025-06-12
Form: S-4
Chunk 21
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 or in number of shares, whichever is more restrictive, of the outstanding shares of New Common Stock and provisions for an automatic transfer to a charitable trust of any shares owned or acquired in excess of the 9.8% limits. See “Description of New NXDT Stock–Restrictions on Ownership and Transfer.”

Treatment of Old NXDT’s Compensation Plans and Outstanding Equity Awards in the Conversion

At the Effective Time, New NXDT will be deemed to have assumed the 2023 Plan. As of the Effective Time, all outstanding rights of participants to acquire Old Common Shares under the 2023 Plan, including pursuant to restricted share units issued by Old NXDT, will automatically convert into rights to acquire an equal number of shares of New Common Stock, on the same terms and conditions that were in effect prior to the Conversion.

Conversion of Old Shares; Conversion Procedures

Conversion of Old Shares

The Plan of Conversion provides that, at the Effective Time, by virtue of the Conversion and without further action on the part of Old NXDT, New NXDT or the shareholders of Old NXDT, each outstanding Old Common Share will be converted into one share of New Common Stock, each outstanding Old Series A Preferred Share will be converted into one share of New Series A Preferred Stock and each outstanding Old Series B Preferred Share will be converted into one share of New Series B Preferred Stock. As a result of the Conversion, the Declaration of Trust will cease to be effective, and the New NXDT Charter and the New NXDT Bylaws will be in effect.

Conversion Procedures

All shares of New Stock issued in connection with the Conversion will be uncertificated. New NXDT will register, or cause to be registered in book-entry form, the shares of New Stock into which each Old Share is converted as a result of the Conversion.

Accounting Treatment of the Conversion

The Conversion will have no effect for accounting purposes. The historical consolidated financial statements of Old NXDT previously reported to the SEC as of and for all periods through the Effective Time will remain the consolidated financial statements of New NXDT.

Federal Income Tax Treatment of the Conversion

The Conversion is intended to qualify as a tax-free reorganization under U.S. federal income tax laws. We expect that U.S. shareholders of Old NXDT will not recognize any gain or loss for U.S. federal income tax purposes upon the exchange of their Old Shares for New Stock. However, the tax consequences to you will depend on your own situation. You are urged to consult your own tax advisors concerning the specific tax consequences of the