Company: NXDT
Filing Date: 2025-01-21
Form Type: 424B3
Source: 0001437749-25-001494
Chunk: 227

Company: NEXPOINT DIVERSIFIED REAL ESTATE TRUST
Filing Date: 2025-01-21
Form: 424B3
Chunk 227
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 Advisory Fee, however, the Advisor agreed to defer payment of the Advisory Fee until NHT is cash flow positive and can sustain the payments. In August 2023, the REIT commenced repayment of a portion of the accrued Advisory Fees.

| Hotel Management Agreements |

NHT’s hotel properties are operated pursuant to hotel management agreements (the “Hotel Management Agreements”) between the Manager and the TRS Entities that lease the properties from NHT OP and its subsidiaries. The Hotel Management Agreements require the TRS Entities to pay a base fee to the Manager calculated as a percentage of hotel revenues generated by the hotel operations. In addition, the Hotel Management Agreements sometimes provide that the Manager can earn an incentive fee for meeting certain performance metrics. Neither NHT nor any of its affiliates has any ownership or economic interest in the Manager engaged by the TRS Entities.

| GOVERNANCE PRACTICES |

A summary of the responsibilities and activities and the membership of each of NHT’s Board committees is set out below. National Policy 58-201 – Corporate Governance Guidelines establishes corporate governance guidelines that apply to all public companies. NHT has reviewed its own corporate governance practices in light of these guidelines. In certain cases, NHT’s practices comply with the guidelines, however, the Board considers that some of the guidelines are not suitable for NHT at its current stage of development and, therefore, these guidelines have not been adopted. The Board is committed to sound corporate governance practices in the interest of its Unitholders. NHT will continue to review and implement corporate governance guidelines as the business of NHT progresses.

In accordance with the corporate governance guidelines set out under National Instrument 58-101 – Disclosure of Corporate Governance Practices (“NI 58-101”), the following is a summary of the governance practices of NHT.

| Composition of Board of Trustees and Independence |

The Board is comprised of four Trustees, a majority of whom are independent Canadian residents. Pursuant to NI 58-101, an independent Trustee is one who is free from any direct or indirect relationship which could, in the view of the Board, be reasonably expected to interfere with a Trustee’s independent judgment. NHT has determined that Neil Labatte (Lead Trustee), Graham Senst and Jerry Patava are independent under NI 58-101, and that James Dondero, NHT’s Chief Executive Officer, is not independent. All of the trusteeships and directorships of the Trustees with other public entities are disclosed in the biographical information for each Trustee set