NexPoint Diversified Real Estate Trust (NXDT)

[Enterprising Investor]

NexPoint Strategic Opportunities Fund Announces Significant Participation in Exchange Offer with $121 Million Tendered, Extends Expiration Date to January 4, 2021 (12/11/20)

DALLAS, Dec. 11, 2020 /PRNewswire/ -- NexPoint Strategic Opportunities Fund (NYSE: NHF) ("NHF" or the "Company") today announced its receipt of significant participation in its tender offer to purchase up to 15 million of its common shares ("Common Shares") in exchange for consideration consisting of approximately 20% cash and 80% newly-issued Series A Cumulative Preferred Shares ("Series A Preferred Shares") (collectively, the "Exchange Offer"). Total Common Shares tendered were equal to 81% of the Exchange Offer.

American Stock Transfer & Trust Company, LLC, the Depositary for the Exchange Offer, has informed the Company that $121 million in Common Shares have been validly tendered and not withdrawn since the commencement of the Exchange Offer. The Company believes the initial response to the Exchange Offer indicates strong shareholder interest, and therefore has decided to extend the Exchange Offer to provide additional time for shareholders to participate.

"We constructed this offer to deliver multiple benefits to shareholders, from providing an opportunity to exchange shares at a premium to the market price at the commencement, to helping narrow the trading discount," said Dustin Norris, president of NexPoint Securities. "With over $120 million tendered, the positive reception from shareholders supports our approach, and we are pleased to extend the expiration date to allow additional shareholders to participate."

As a result of the extension, the Exchange Offer will expire on January 4, 2021 at 5:00 p.m. EST (as so extended, the "Expiration Date"). All other terms of the Exchange Offer remain unchanged. The extension does not affect the Common Shares tendered to date; shareholders who have already tendered Common Shares do not need to re-tender their Common Shares or take any additional action as a result of the extension. However, as reflected in the terms of the Exchange Offer, shareholders are also permitted to withdraw Common Shares they have previously tendered at any time prior to the new Expiration Date if they so desire.

The Company announced the commencement of the Exchange Offer in a press release on October 30, 2020. Under the Exchange Offer, the Company will purchase Common Shares up to a maximum aggregate purchase price of $150 million of Common Shares; however, the Exchange Offer is conditioned on, among other things, shareholders validly tendering (and not properly withdrawing) Common Shares representing an aggregate purchase price of at least $75 million of Common Shares prior to the Expiration Date. While the participation to date surpassed the $75 million minimum aggregate purchase price required to proceed, the Company decided to extend the Expiration Date to allow additional time for shareholders to submit tenders.

The purpose of the Exchange Offer is to provide shareholders with an opportunity to exchange Common Shares at a premium to the current market price, while increasing the NAV per Common Share for shareholders who choose not to participate—or choose not to participate fully—in the Exchange Offer.

Egan-Jones Ratings Company ("Egan-Jones") assigned an investment grade corporate rating of BBB- to the Series A Preferred Shares and a rating of BBB to the Company. The Company believes the investment grade rating has the potential to allow the Series A Preferred Shares to trade competitively on the secondary market.

Dividends and distributions on the Series A Preferred Shares are cumulative from their original issue date at the annual rate of 5.50% of the $25.00 per share liquidation preference and will be payable quarterly on March 31, June 30, September 30 and December 31 of each year, beginning with the first payment on March 31, 2021.

Additional Information on Exchange Offer

Full terms of the Exchange Offer are available at www.sec.gov.

Any questions about the Exchange Offer or requests for assistance in tendering Shares can be directed to the Company's Information Agent, AST Fund Solutions, LLC. The Company's Information Agent can be reached toll-free at [phone].

The Exchange Offer is not expected to have any effect on the Company's conversion to a real estate investment trust (a "REIT", and the conversion, the "Conversion"). The Company currently intends to continue with the Conversion process regardless of the outcome of the Exchange Offer.

About the NexPoint Strategic Opportunities Fund (NHF)

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. On August 28, 2020, shareholders approved the Conversion proposal and amended the Company's fundamental investment policies and restrictions to permit the Company to pursue its new business. The Company is in the process of realigning its portfolio so that it is no longer an "investment company" under the Investment Company Act of 1940 (the "1940 Act") and continues to expect the Company to be able to transition its investment portfolio sufficient to qualify as a REIT for tax purposes by the first quarter of 2021 and to apply to the Securities and Exchange Commission (the "SEC") for an order under the 1940 Act declaring that the Company has ceased to be an investment company (the "Deregistration Order") in the first half of 2021.

For more information visit www. www.nexpointgroup.com/nexpoint-strategic-opportunities-fund/

About NexPoint Advisors, L.P.

NexPoint Advisors, L.P. (the "Investment Adviser") is an SEC-registered adviser on the NexPoint alternative investment platform. NexPoint's platform provides differentiated access to alternatives through a range of investment solutions, including public and private real estate investment trusts, tax-advantaged real estate vehicles, closed-end funds, interval funds, and a business development company. NexPoint is based in Dallas, Texas and is part of a network of affiliates with expertise across the asset management and financial services spaces.

For more information visit www.nexpointgroup.com

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