NexPoint Extends Offer to Purchase Up to All Shares of United Development Funding IV (UDFI)
NexPoint Advisors, L.P. has extended its tender offer to acquire Shares of Beneficial Interest in United Development Funding IV (UDFI) at $1.10 per share. The new deadline is now August 23, 2022. The offer is contingent on several conditions, including the absence of legal challenges and government approvals. NexPoint has recently transitioned NXDT from an investment company to a real estate investment trust (REIT), impacting its investment strategies. Key changes include a reduction in shareholder ownership limits by UDFI to counter the offer.
- NXDT has successfully converted from an investment company to a REIT, enhancing its investment opportunities.
- The extension of the tender offer provides shareholders additional time to evaluate the offer at a set price of $1.10.
- UDFI has reduced the maximum percentage of shares a shareholder can own from 9.8% to 5.0%, which may limit shareholder participation in the offer.
- There are ongoing legal and regulatory conditions attached to the tender offer that may complicate the acquisition process.
DALLAS, July 24, 2022 /PRNewswire/ -- NexPoint Advisors, L.P., investment adviser to the NexPoint Diversified Real Estate Trust ("NXDT" and together with affiliated entities "NexPoint"), today announced the extension of the offering period for its previously announced offer to purchase Shares of Beneficial Interest (the "Shares") of United Development Funding IV ("UDFI" or the "Company") at a price of
As previously announced on December 14, 2020, the Offer is conditioned upon, among other things, the satisfaction or waiver of the following conditions: (i) there shall not have been threatened, instituted, or pending any action or proceeding before any court or any governmental or administrative agency (a) challenging the acquisition of shares pursuant to the Offer or otherwise relating in any manner to the Offer, or (b) in the sole judgment of NexPoint, otherwise materially adversely affecting the Company; (ii) NexPoint shall have received all required governmental approvals, if any, for the Offer; (iii) NexPoint shall have had the opportunity to conduct sufficient due diligence to determine whether the offered price per share is reasonable given the current financial condition and results of operations of UDFI; (iv) the Board of Trustees of UDFI shall have waived in writing the ownership limitations set forth in Article VII of the Declaration of Trust of UDFI as such limitations would otherwise apply to the Offer; and (v) NexPoint shall have received satisfactory evidence that UDFI has continued to qualify as a real estate investment trust ("REIT") under federal tax laws and thereby to avoid any entity-level federal income or excise tax.
NXDT has recently completed its conversion from an investment company registered under the Investment Company Act of 1940 into a real estate investment trust ("REIT"). In connection with that conversion, NXDT dropped down certain of its investments to a single-member, wholly owned limited liability company subsidiary, NexPoint Real Estate Opportunities ("NREO"), which heretofore has been reflected as a portfolio company of NXDT in its SEC filings. NexPoint Advisors, L.P., external adviser to NXDT and NREO, continues to have investment and voting power over the UDF IV Common Shares. Accordingly, NexPoint continues to beneficially own the UDF IV Common Shares it had previously reported to the SEC on its last Schedule 13D.
On January 8, 2021, UDFI announced that it had reduced the percentage of outstanding Shares that a shareholder may own from
Shareholders should read the Offer to Purchase and the related materials carefully because they contain important information. Shareholders may obtain a free copy of the Offer to Purchase and the Assignment Form from D.F. King & Co., Inc., the information agent for the Offer (the "Information Agent"), by calling toll-free at (800) 331-7543. THE OFFER WILL EXPIRE AT 12:00 MIDNIGHT, EASTERN TIME, AT THE END OF THE DAY ON AUGUST 23, 2022, UNLESS THE OFFER IS EXTENDED OR EARLIER TERMINATED.
About the NexPoint Diversified Real Estate Trust (NXDT)
The NexPoint Diversified Real Estate Trust (NYSE: NXDT), formerly the NexPoint Strategic Opportunities Fund (NYSE: NHF), is a diversified REIT that formerly operated as a closed-end fund. The name change became effective on November 8, 2021. On August 28, 2020, shareholders approved the conversion from a closed-end management investment company under the Investment Company Act of 1940 (the "1940 Act") and amended NXDT's fundamental investment policies and restrictions to permit NXDT to operate as a diversified REIT. NXDT completed the repositioning of its investment portfolio sufficient to achieve REIT tax status and operated during its 2021 taxable year, and continues to operate, so that it qualifies for taxation as a REIT. NXDT has also realigned its portfolio so that it is no longer an "investment company" under the 1940 Act. On July 1, 2022, NXDT received an order from the Securities and Exchange Commission (the "SEC") declaring that NXDT has ceased to be an investment company and that its registration under the 1940 Act is no longer in effect (the "Deregistration Order").
For more information visit www.nexpoint.com/nexpoint-strategic-opportunities-fund
About NexPoint Advisors, L.P.
NexPoint Advisors, L.P. is an SEC-registered adviser on the NexPoint alternative investment platform. It serves as the adviser to a suite of funds and investment vehicles, including a closed-end fund, interval fund, business development company, and various real estate vehicles. For more information visit www.nexpoint.com
Risks and Disclosures
This document is for informational purposes only and is neither an offer to purchase nor a solicitation of an offer to sell any common stock of UDFI or any other securities. The offer to purchase common stock of UDFI will only be made pursuant to the Offer to Purchase, the Assignment Form and related documents. THE TENDER OFFER MATERIALS (INCLUDING THE OFFER TO PURCHASE, THE ASSIGNMENT FORM AND CERTAIN OTHER TENDER OFFER DOCUMENTS) WILL CONTAIN IMPORTANT INFORMATION. STOCKHOLDERS OF UDFI ARE URGED TO READ THESE DOCUMENTS CAREFULLY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION THAT SUCH STOCKHOLDERS SHOULD CONSIDER BEFORE MAKING ANY DECISION REGARDING TENDERING THEIR SHARES. Investors and security holders may obtain a free copy of these statements (when available) by directing such requests to the Information Agent, by calling toll-free at (800) 331-7543.
Media Contact
Lucy Bannon
lbannon@nexpoint.com
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SOURCE NexPoint Advisors, L.P.
FAQ
What is the new deadline for NexPoint's tender offer for UDFI shares?
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What conditions are attached to the tender offer for UDFI shares?
How has NXDT changed its structure recently?
Why did UDFI reduce the percentage of shares a shareholder can own?
