HOW IT WORKS

Four layers of legal protection.
Managed by an independent foundation.

We never finance more than 85% of project costs, and in practice considerably less. Each project has four forms of legal security — documented in the project dossier. Below you can read how that works in practice.

For Bétera Residences that is 75%: a €1,200,000 bond issue against €1,600,000 in project costs, with €400,000 of NXO's own contribution.

Every project its own entity, its own securities, its own terms and its own timeline.

01

First or second-ranking mortgage

A mortgage is placed on the property per project in favour of Stichting Obligatiehoudersbelangen, which holds it on behalf of all bondholders. Which rank applies — first or second — is set out per project in the information memorandum. With a first-ranking mortgage the foundation has first claim on the enforcement proceeds, comparable to a bank's priority. With a second-ranking mortgage the proceeds go to the bondholders after the first mortgagee has been repaid.

A mortgage may be omitted if security is otherwise sufficiently covered; always check the project dossier. For the current issue Bétera Residences this is a first-ranking mortgage.

02

Pledge on SPV shares

Shares in each project company (SPV) are pledged to Stichting Obligatiehoudersbelangen. Cross-default is structurally excluded; in case of default the Foundation can intervene directly on behalf of all bondholders.

Pledges are recorded in notarial or private deeds; the Foundation holds the pledge for investors.

03

Pledge on the intercompany receivable

The loan between NXO Issuer and the project is pledged. This gives a direct claim on project cash flows — an extra layer of security on top of the pledge on the shares.

04

Assignment of the sale proceeds

Rental income and sale proceeds are pledged to the investors. Future proceeds are in principle enforceable for the benefit of bondholders.

Beyond the legal protections

How the structure is set up further.

Stichting Obligatiehoudersbelangen as security agent

An independent foundation acts as security agent on behalf of bondholders. It manages and monitors legal protections and can act for investors in case of default.

NXO co-invests, fully subordinated

NXO contributes its own capital to every project and subordinates it entirely to the bondholders. Principal and interest are paid to the bondholders first; only after that does any result reach NXO. That contribution is therefore the first buffer to absorb a setback. For Bétera Residences this is €400,000, 25% of project costs.

Where is your limit?

A bondholder is only affected once the sale proceeds fall below the bond amount. For Bétera Residences the sales price is budgeted at €3,051 per m². The bond can be repaid in full down to a price of €2,116 per m². Prices may therefore fall by more than 30% before bondholders are affected.

This is an arithmetic comparison based on the information memorandum, not a guarantee. Delay, higher construction costs or slower sales change the picture.

Questions about security?

Do you have questions about our security structure or the protection of your investment? Feel free to get in touch. We are happy to explain it personally.

View projects

This page is intended as a general explanation. The exact securities and priority are set out per project in the information memorandum. It does not constitute legal or investment advice. Investing involves risks; you may lose (part of) your investment.