NexPoint Extends Offer to Purchase Up to All Shares of United Development Funding IV (UDFI)
NexPoint Advisors, L.P. announced an extension of its offer to purchase all Shares of Beneficial Interest of United Development Funding IV (UDFI) at $1.10 per share. The new expiration date is May 25, 2022, unless further changed. The offer is subject to specific conditions, including necessary governmental approvals and due diligence by NexPoint. Notably, UDFI has recently reduced the maximum percentage of shares a single shareholder can own from 9.8% to 5.0%, complicating the acquisition. NXDT is in the process of converting to a real estate investment trust (REIT) and has restructured its portfolio accordingly.
- None.
- UDFI has reduced shareholder ownership limit from 9.8% to 5.0%, potentially frustrating the tender offer.
- Conditions for the offer include receiving all necessary governmental approvals, which may delay the acquisition.
DALLAS, April 25, 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 any and all 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 is in the process of converting 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 is reflected as a portfolio company of NXDT. 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 MAY 25, 2022, UNLESS THE OFFER IS EXTENDED OR EARLIER TERMINATED.
The NexPoint Diversified Real Estate Trust (NYSE: NXDT), formerly the NexPoint Strategic Opportunities Fund (NYSE:NHF), is a closed-end fund managed by NexPoint Advisors, L.P. that is in the process of converting to a diversified REIT. The name change became effective on November 8, 2021. On August 28, 2020, shareholders approved the conversion proposal and amended NXDT's fundamental investment policies and restrictions to permit NXDT to pursue its new business. NXDT has completed the repositioning of its investment portfolio sufficient to achieve REIT tax status and is operating during its 2021 taxable year so that it may qualify for taxation as a REIT.NXDT has also realigned its portfolio so that it is no longer an "investment company" under the Investment Company Act of 1940 (the "1940 Act"). On March 31, 2021, NXDT filed an application with the Securities and Exchange Commission (the "SEC") for an order under the 1940 Act declaring that NXDT no longer operates as an investment company (the "Deregistration Order"). During the SEC's review process, NXDT will continue to be structured as a closed-end investment fund.
For more information visit www.nexpoint.com/nexpoint-strategic-opportunities-fund
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
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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.
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SOURCE NexPoint Advisors, L.P.
FAQ
What is the new expiration date for NXDT's offer to purchase UDFI shares?
What is the offer price per share for UDFI from NXDT?
What recent changes has UDFI made regarding shareholder ownership limits?
What conditions must be met for NXDT's offer to proceed?
What is NXDT's current status in terms of its investment structure?
