DEF 14A: Highland Opportunities and Income Fund to Hold Annual Shareholder Meeting on June 26, 2024

Highland Opportunities and Income Fund announces its annual shareholder meeting to elect a Class III Trustee and discuss fund matters.

Summary

• Highland Opportunities and Income Fund (HFRO) will hold its Annual Meeting of Shareholders on June 26, 2024, in Dallas, Texas.
• The primary purpose of the meeting is to elect John Honis as a Class III Trustee for a three-year term expiring at the 2027 Annual Meeting.
• Shareholders of record as of May 10, 2024, are entitled to vote.
• As of the record date, there were 66,894,537 common shares and 5,800,000 preferred shares outstanding.
• The Board of Trustees recommends a vote FOR the election of the nominee.
• Proxy materials are available online and can be requested by calling Morrow Sodali Fund Solutions at (833) 812-4844.
• Morrow Sodali Fund Solutions has been engaged to provide shareholder meeting services at an approximate cost of $27,800.
• The Fund is a closed-end management investment company managed by NexPoint Asset Management, L.P.

Sentiment

Score: 7

Explanation: The document is a standard proxy statement, which is generally neutral in tone. The recommendation to vote for the trustee nominee suggests a positive outlook from the Board.

Positives

• The Board of Trustees is actively engaged in overseeing the Fund's operations and risk management.
• The Fund has a process for shareholders to communicate with the Trustees.
• The Audit Committee is comprised of independent members and oversees the Fund's accounting and financial reporting processes.
• The Fund provides multiple avenues for shareholders to vote, including online, by phone, and by mail.

Risks

• The document mentions that the Board recognizes that not all risks that may affect the Fund can be identified.
• The document mentions that it may not be practical or cost-effective to eliminate or mitigate certain risks.
• The document mentions that reports received by the Trustees with respect to risk management matters are typically summaries of the relevant information.
• The document mentions that the processes, procedures and controls employed to address risks may be limited in their effectiveness.

Future Outlook

The Trustees do not intend to present any other business at the Annual Meeting nor are they aware that any shareholder intends to do so. If, however, any other matters are properly brought before the Annual Meeting, the persons named in the accompanying proxy will vote thereon in accordance with their judgment.

Management Comments

• Frank Waterhouse, Principal Executive Officer, Principal Financial Officer, Principal Accounting Officer and Treasurer, encourages shareholders to vote their shares.
• The Board of Trustees recommends a vote FOR the Proposal.

Industry Context

This is a standard proxy statement for a closed-end investment fund, outlining the agenda for the annual meeting and seeking shareholder votes on the election of a trustee. Such filings are common in the investment management industry to ensure corporate governance and shareholder participation.

Comparison to Industry Standards

• The structure of the Board, with a majority of independent trustees, aligns with industry best practices for registered investment companies.
• The fee structure for advisory and administrative services is typical for closed-end funds, although the specific percentages may vary based on the fund's size and investment strategy.
• The process for shareholder communication and proposal submission is consistent with SEC regulations and industry norms.
• The engagement of Morrow Sodali for proxy solicitation is a common practice among investment funds to ensure sufficient shareholder participation.

Related Party Transactions

• The Fund has an investment advisory agreement with NexPoint Asset Management, L.P., where the Adviser provides investment advisory services in exchange for a fee.
• The Fund has an administration agreement with the Adviser, where the Adviser receives an annual fee of 0.20% of the average weekly value of the Funds Managed Assets.
• The Adviser delegates certain administrative functions to SEI Investments Global Funds Services (SEI) under a sub-administration agreement.
• The Adviser has entered into a Services Agreement with Skyview Group (Skyview), pursuant to which the Adviser will receive administrative and operational support services.

Stakeholder Impact

• Shareholders have the opportunity to vote on the election of a trustee and influence the governance of the Fund.
• The outcome of the trustee election will impact the composition of the Board and its oversight of the Fund's operations.
• The Fund's performance and management decisions will affect shareholder returns.
• The Fund's service providers, including the Adviser and administrator, are impacted by the Fund's operations and financial performance.

Next Steps

• Shareholders should review the proxy materials and vote their shares before the Annual Meeting on June 26, 2024.
• The Fund will hold the Annual Meeting and tabulate the votes.
• The Board will consider any other business that may properly come before the meeting.

Key Dates

Keywords

Annual Meeting, Proxy Statement, Trustee Election, Shareholders, Highland Opportunities and Income Fund, HFRO, NexPoint, Investment Company