As filed with the Securities and Exchange Commission on March 6, 2025
UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE
TO
(Amendment No. 2)
Tender
Offer Statement Under Section 14(d)(1) or 13(e)(1)
of the Securities Exchange Act Of 1934
Highland Opportunities and Income Fund
(Name of Subject Company (Issuer))
Highland Opportunities
and Income Fund
(Name of Filing Person (Issuer))
Common shares of beneficial
interest, par value $0.001
(Title of Class of Securities)
43010E404
(CUSIP Number of Securities)
Frank Waterhouse
Highland Opportunities and Income Fund
300 Crescent Court, Suite 700
Dallas, Texas 75201
Telephone: (866) 351-4440
(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications on Behalf of the Person(s) Filing Statement)
With a Copy to:
Jon-Luc Dupuy
K&L Gates, LLP
1 Congress Street
Boston, MA 02114
Telephone: (617) 261-3146
| ☐ | Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer. |
Check the appropriate boxes below to designate any transactions to which the statement relates:
| ☐ | Third-party tender offer subject to Rule 14d-1. | |
| ☒ | Issuer tender offer subject to Rule 13e-4. | |
| ☐ | Going-private transaction subject to Rule 13e-3. | |
| ☐ | Amendment to Schedule 13D under Rule 13d-2. |
Check the following box if the filing is a final amendment reporting the results of the tender offer. ☐
If applicable, check the appropriate box(es) below to designate the appropriate rule provision(s) relied upon:
| ☐ | Rule 13e-4(i) (Cross-Border Issuer Tender Offer) | |
| ☐ | Rule 14d-1(d) (Cross-Border Third-Party Tender Offer) |
INTRODUCTORY STATEMENT
This amendment no. 2 (this “Amendment No. 2”) amends and supplements the Tender Offer Statement on Schedule TO (together with any subsequent amendments and supplements thereto, the “Schedule TO”), filed with the Securities and Exchange Commission (the “SEC”) by Highland Opportunities and Income Fund, a Massachusetts business trust (together with its subsidiaries, “HFRO” or the “Issuer”), on February 3, 2025, relating to the offer by HFRO to exchange up to $100,000,000 in aggregate purchase price of the Issuer’s currently outstanding common shares of beneficial interest, par value $0.001 per share, for (i) shares of Highland Opportunities and Income Fund’s 5.375% Series B Cumulative Preferred Shares, par value $0.001 and liquidation preference $25.00 per share (“Series B Preferred Shares”) upon the terms and subject to the conditions contained in the Offer to Exchange dated February 3, 2025 and the related Letter of Transmittal. Capitalized terms used but not defined herein have the meanings ascribed to them in the Schedule TO, the Offer to Exchange or the Letter of Transmittal, as applicable.
This Amendment No. 2 is an amendment to the Schedule TO and is being filed (i) to further report the preliminary results of the Exchange Offer, which expired at 5:00 p.m. New York City time on March 4, 2025, and (ii) to include a press release announcing further details regarding the preliminary results of the Exchange Offer. A copy of the press release is attached hereto as Exhibit (a)(5)(4). Only those items amended are reported in this Amendment No. 2.
Except as specifically provided herein, the information set forth in the Schedule TO, including all schedules and annexes thereto that were previously filed therewith, remains unchanged and is incorporated herein by reference, except that such information is hereby amended and supplemented to the extent specifically provided for herein and to the extent amended and supplemented by the exhibit filed herewith.
You should read this Amendment No. 2 together with the Schedule TO, the Offer to Exchange and the Letter of Transmittal.
ITEM 12. EXHIBITS.
| (1) | Incorporated by reference to the Issuer’s Tender Offer Statement on Schedule TO (File No. 005-90216), filed on February 3, 2025. |
| (2) | Incorporated by reference to Post-Effective Amendment adding exhibits to the Issuer’s Registration Statement on Form N-2 (File No. 333-219103), filed on January 2, 2025. |
| (3) | Incorporated by reference to the Issuer’s Registration Statement on Form N-2 (File No. 333-230078), filed on March 5, 2019. |
| (4) | Incorporated by reference to Post-Effective Amendment No. 2 to the Issuer’s Registration Statement on Form N-2 (File No. 333-173004), filed on August 22, 2013. |
| (5) | Incorporated by reference to Post-Effective Amendment No. 6 to the Issuer’s Registration Statement on Form N-2 (File No. 333-173004), filed on April 30, 2015. |
| (6) | Incorporated by reference to Post-Effective Amendment No. 1 to the Issuer’s Registration Statement on Form N-2 (File No. 333-230078), filed on August 27, 2019. |
| (7) | Incorporated by reference to the Issuer’s Tender Offer Statement on Schedule TO (File No. 005-83652), filed on October 30, 2020. |
| (8) | Incorporated by reference to Amendment No. 1 to the Issuer’s Tender Offer Statement on Schedule TO (File No. 005-90216), filed on March 5, 2025. |
| (9) | Filed herewith. |
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.
| Highland Opportunities and Income Fund | |||
| By: | /s/ Frank Waterhouse | ||
| Name: | Frank Waterhouse | ||
| Title: | Treasurer, Principal Accounting Officer, Principal Financial Officer, and Principal Executive Officer | ||
Dated as of: March 6, 2025
Exhibit Index
| Exhibit Number | Description | |
| (a)(5)(4) | Press Release issued on March 5, 2025 |
Highland Opportunities & Income Fund SC TO-I
Exhibit 99.(a)(5)(4)
Highland Opportunities and Income Fund (HFRO) Provides Details on Results of Oversubscribed Tender and Exchange Offer
DALLAS, March 5, 2025 - The Highland Opportunities and Income Fund (NYSE:HFRO) (“HFRO” or the “Fund”) today announced the details of its tender and exchange offer (the “Exchange Offer”) to exchange common shares (the “Common Shares”) for newly issued 5.375% Series B Preferred Shares (the “Preferred Shares”).
Based on the final count by Equiniti Trust Company, LLC, the depositary for the Exchange Offer, a total of 21,673,105 shares of HFRO Common Shares were properly tendered and not properly withdrawn. In accordance with the terms and conditions of the Exchange Offer the Fund currently expects to exchange 10,000,000 Common Shares for Preferred Shares with an aggregate liquidation preference of approximately $100 million. As the Exchange Offer was oversubscribed, the Fund intends to exchange Common Shares from all tendering shareholders on a pro rata basis as described in the Offer to Exchange.
The proration factor for the Common Shares that HFRO will accept pursuant to the Exchange Offer is approximately 46.140199 percent, and they will be allotted on pro-rata basis, as described in the Offer to Exchange. Any Common Shares that are not accepted for tender will be returned to the common shareholders that tendered them.
The number of Common Shares expected to be exchanged in the Exchange Offer and proration factor are subject to change.
About the Highland Opportunities and Income
Fund
The Highland Opportunities and Income Fund (NYSE: HFRO) is a closed-end fund managed
by NexPoint Asset Management, L.P. For more information visit nexpointassetmgmt.com/opportunities-income-fund.
About NexPoint Asset Management, L.P.
NexPoint Asset Management, L.P. is an SEC-registered investment adviser. It is the adviser to a suite of registered funds, including
open-end mutual funds and closed-end funds. For more information nexpointassetmgmt.com.
Risks and Disclosures
Additional terms and conditions of the Exchange Offer were set forth in the Fund’s offering materials, which were filed with the
U.S. Securities and Exchange Commission (the “SEC”) and distributed to the Fund’s common shareholders. As the number
of Common Shares tendered for the Fund exceeded the maximum amount of the Exchange Offer, the Fund will purchase Common Shares from tendering
shareholders on a pro-rata basis (disregarding fractional Common Shares and fractional Preferred Shares).
The Fund has concluded the exchange offer described in this press release. This press release is not a recommendation, an offer to purchase or a solicitation of an offer to sell any securities of HFRO and the above statements are not intended to constitute an offer to participate in any tender or exchange offer. The solicitation and the offer to exchange Common Shares of HFRO was made pursuant to an offer to exchange and related materials that HFRO filed with the SEC and distributed to Fund Shareholders. Investors could obtain free copies of the Exchange Offer Statement and other documents filed with the SEC at the SEC’s web site at sec.gov or on the Fund’s website at nexpointassetmgmt.com/opportunities-income-fund.
The Fund is relying on Section 3(a)(9) of the Securities Act of 1933 (the “Securities Act”) to exempt the Exchange Offer from the registration requirements of the Securities Act. Section 3(a)(9) provides that the registration requirements of the Securities Act will not apply to “any security exchanged by the issuer with its existing security holders exclusively where no commission or other remuneration is paid or given directly or indirectly for soliciting such exchange.” The Fund has no contract, arrangement or understanding relating to, and will not, directly or indirectly, pay any commission or other remuneration to any broker, dealer, salesperson, agent or any other person for soliciting tenders in the Exchange Offer.
Investors should consider the investment objectives, risks, charges, and expenses of the Highland Opportunities and Income Fund carefully before investing. This and other information can be found in the Fund’s annual report, which may be obtained by calling (800) 357-9167 or on the website at nexpointassetmgmt.com. Please read the annual report carefully before you invest. Any distribution paid by the Fund may include a return of capital. Please refer to the 19(a)-1 Source of Distribution Notice on the NexPoint Asset Management website for Section 19 notices that provide estimated amounts and sources of the Fund’s distributions, which should not be relied upon for tax reporting purposes.
CONTACTS
Investor Relations
Kristen Griffith
IR@nexpoint.com
Media Relations
Comms@nexpoint.com