Highland Opportunities & Income Fund (HFRO) investors report 7.5% stake in Schedule 13D/A

Rhea-AI Filing Summary

Highland Opportunities & Income Fund (HFRO) received an updated Schedule 13D/A (Amendment No. 2) from a group of affiliated investors led by James D. Dondero. The filing reports that since the last disclosed transaction, Highland Global Allocation Fund purchased 636,327 Common Shares in open-market transactions for an aggregate $4,055,613, funded with working capital.

As of December 10, 2025, James D. Dondero may be deemed to beneficially own 4,144,711.77 Common Shares, or about 7.5% of HFRO’s outstanding Common Shares. Drugcrafters, L.P. holds 72,082 shares (about 0.1%), Highland Global Allocation Fund and NexPoint Asset Management, L.P. each report 2,064,005 shares (about 3.7% each), and a trust for which Nancy Marie Dondero serves as trustee holds 2,006,881.1 shares (about 3.6%).

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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No. 2)

HIGHLAND OPPORTUNITIES & INCOME FUND

(Name of Issuer)

Common Shares, par value $0.001 per share

(Title of Class of Securities)

43010E404

(CUSIP Number)

Stephanie Vitiello, CCO
NexPoint Asset Management, L.P., 300 Crescent Court, Suite 700
Dallas, TX, 75201
214-453-6500

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

12/10/2025

(Date of Event Which Requires Filing of This Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box.

The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

SCHEDULE 13D

CUSIP No. 43010E404

1

Name of reporting person

DONDERO JAMES D

2

Check the appropriate box if a member of a Group (See Instructions)

(a)
(b)

3

SEC use only

4

Source of funds (See Instructions)

WC, AF

5

Check if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e)

6

Citizenship or place of organization

UNITED STATES

Number of Shares Beneficially Owned by Each Reporting Person With:

7	Sole Voting Power 1,743.67
8	Shared Voting Power 4,144,711.77
9	Sole Dispositive Power 1,743.67
10	Shared Dispositive Power 4,144,711.77

11

Aggregate amount beneficially owned by each reporting person

4,144,711.77

12

Check if the aggregate amount in Row (11) excludes certain shares (See Instructions)

13

Percent of class represented by amount in Row (11)

7.5 %

14

Type of Reporting Person (See Instructions)

HC, IN

SCHEDULE 13D

CUSIP No. 43010E404

1

Name of reporting person

HIGHLAND GLOBAL ALLOCATION FUND

2

Check the appropriate box if a member of a Group (See Instructions)

(a)
(b)

3

SEC use only

4

Source of funds (See Instructions)

WC

5

Check if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e)

6

Citizenship or place of organization

MASSACHUSETTS

Number of Shares Beneficially Owned by Each Reporting Person With:

7	Sole Voting Power 0.00
8	Shared Voting Power 2,064,005.00
9	Sole Dispositive Power 0.00
10	Shared Dispositive Power 2,064,005.00

11

Aggregate amount beneficially owned by each reporting person

2,064,005.00

12

Check if the aggregate amount in Row (11) excludes certain shares (See Instructions)

13

Percent of class represented by amount in Row (11)

3.7 %

14

Type of Reporting Person (See Instructions)

IV

SCHEDULE 13D

CUSIP No. 43010E404

1

Name of reporting person

Drugcrafters, L.P.

2

Check the appropriate box if a member of a Group (See Instructions)

(a)
(b)

3

SEC use only

4

Source of funds (See Instructions)

WC

5

Check if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e)

6

Citizenship or place of organization

DELAWARE

Number of Shares Beneficially Owned by Each Reporting Person With:

7	Sole Voting Power 0.00
8	Shared Voting Power 72,082.00
9	Sole Dispositive Power 0.00
10	Shared Dispositive Power 72,082.00

11

Aggregate amount beneficially owned by each reporting person

72,082.00

12

Check if the aggregate amount in Row (11) excludes certain shares (See Instructions)

13

Percent of class represented by amount in Row (11)

0.1 %

14

Type of Reporting Person (See Instructions)

PN

SCHEDULE 13D

CUSIP No. 43010E404

1

Name of reporting person

NEXPOINT ASSET MANAGEMENT, L.P.

2

Check the appropriate box if a member of a Group (See Instructions)

(a)
(b)

3

SEC use only

4

Source of funds (See Instructions)

WC, AF

5

Check if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e)

6

Citizenship or place of organization

DELAWARE

Number of Shares Beneficially Owned by Each Reporting Person With:

7	Sole Voting Power 0.00
8	Shared Voting Power 2,064,005.00
9	Sole Dispositive Power 0.00
10	Shared Dispositive Power 2,064,005.00

11

Aggregate amount beneficially owned by each reporting person

2,064,005.00

12

Check if the aggregate amount in Row (11) excludes certain shares (See Instructions)

13

Percent of class represented by amount in Row (11)

3.7 %

14

Type of Reporting Person (See Instructions)

IA, PN

SCHEDULE 13D

CUSIP No. 43010E404

1

Name of reporting person

DONDERO NANCY MARIE

2

Check the appropriate box if a member of a Group (See Instructions)

(a)
(b)

3

SEC use only

4

Source of funds (See Instructions)

AF

5

Check if disclosure of legal proceedings is required pursuant to Items 2(d) or 2(e)

6

Citizenship or place of organization

UNITED STATES

Number of Shares Beneficially Owned by Each Reporting Person With:

7	Sole Voting Power 0.00
8	Shared Voting Power 2,006,881.10
9	Sole Dispositive Power
10	Shared Dispositive Power 2,006,881.10

11

Aggregate amount beneficially owned by each reporting person

2,006,881.10

12

Check if the aggregate amount in Row (11) excludes certain shares (See Instructions)

13

Percent of class represented by amount in Row (11)

3.6 %

14

Type of Reporting Person (See Instructions)

IN

SCHEDULE 13D

Item 1.	Security and Issuer
(a)	Title of Class of Securities: Common Shares, par value $0.001 per share
(b)	Name of Issuer: HIGHLAND OPPORTUNITIES & INCOME FUND
(c)	Address of Issuer's Principal Executive Offices: 300 CRESCENT COURT, DALLAS, TEXAS , 75201.
Item 1 Comment: This Amendment No. 2 (this "Amendment") is being filed on behalf of James D. Dondero, Highland Global Allocation Fund, a Massachusetts business trust ("GAF"), Drugcrafters, L.P., a Delaware limited partnership ("Drugcrafters"), NexPoint Asset Management, L.P., a Delaware limited partnership ("NexPoint"), and Nancy Marie Dondero (collectively, the "Reporting Persons"), and amends the Schedule 13D filed with the United States Securities and Exchange Commission on September 22, 2025, as subsequently amended on October 7, 2025 (the "Schedule 13D"). The Schedule 13D is supplementally amended as follows.
Item 3.	Source and Amount of Funds or Other Consideration
	Since the last transaction reported in the Schedule 13D, GAF has purchased 636,327 Common Shares in open market transactions with the Reporting Person's working capital, with an aggregate purchase price of $4,055,613.
Item 5.	Interest in Securities of the Issuer
(a)	As of December 10, 2025, (i) James D. Dondero may be deemed to beneficially own 4,144,711.77 Common Shares, which represents approximately 7.5% of the outstanding Common Shares, (ii) Drugcrafters may be deemed to beneficially own 72,082 Common Shares, which represents approximately 0.1% of the outstanding Common Shares, (iii) GAF may be deemed to beneficially own 2,064,005 shares of Common Shares, which represents approximately 3.7% of the outstanding Common Shares, (iv) NexPoint may be deemed to beneficially own 2,064,005 shares of Common Shares, which represents approximately 3.7% of the outstanding Common Shares and (v) Nancy Marie Dondero, in her capacity as trustee of a trust, may be deemed to beneficially own 2,006,881.1 shares of Common Shares, which represents approximately 3.6% of the outstanding Common Shares. James D. Dondero has the right to acquire beneficial ownership of all shares of Common Shares owned by the trust referred to in the preceding sentence.
(b)	(1) Mr. Dondero has sole voting power and sole dispositive power with respect to 1,743.67 Common Shares and shared voting power and shared dispositive power with respect to 4,144,711.77 Common Shares. These shares are held by Mr. Dondero indirectly through NexPoint and their advised accounts (as described in paragraph (4) below), Drugcrafters, a proprietary account and a 401(k) account. These also include shares that Mr. Dondero has the right to acquire beneficial ownership of that are held by the trust referred to in Item 5(a), for which he does not serve as trustee. Mr. Dondero is the sole stockholder and director of NexPoint's general partner, and may be deemed to be an indirect beneficial owner of the shares held by NexPoint. Mr. Dondero disclaims beneficial ownership of such shares. (2) Drugcrafters has sole voting power and sole dispositive power with respect to 0 Common Shares and shared voting power and shared dispositive power with respect to 72,082 Common Shares. Mr. Dondero owns 75% of PCMG Trading Partners XXIII, L.P. ("PCMG") and PCMG owns 99% of Drugcrafters. These entities are ultimately controlled by Mr. Dondero. Mr. Dondero may be deemed to be an indirect beneficial owner of the shares held by Drugcrafters. Mr. Dondero disclaims beneficial ownership of such shares except to the extent of his pecuniary interest therein. (3) GAF has sole voting power and sole dispositive power with respect to 0 Common Shares and shared voting power and shared dispositive power with respect to 2,064,005 Common Shares. GAF is managed by NexPoint, which is ultimately controlled by Mr. Dondero. Mr. Dondero may be deemed to be an indirect beneficial owner of the shares held by GAF. Mr. Dondero disclaims beneficial ownership of such shares except to the extent of his pecuniary interest therein. (4) NexPoint has sole voting power and sole dispositive power with respect to 0 Common Shares and shared voting power and shared dispositive power with respect to 2,064,005 Common Shares. These shares are held by NexPoint indirectly through an advised account. Mr. Dondero is the sole stockholder and director of NexPoint's general partner, and may be deemed to be an indirect beneficial owner of the shares held by NexPoint. (5) A trust for which Ms. Dondero serves as trustee has sole voting power and sole dispositive power with respect to 0 Common Shares and shared voting power and shared dispositive power with respect to 2,006,881.1 Common Shares. Ms. Dondero is the sister of Mr. Dondero and disclaims beneficial ownership of such shares.
(c)	Annex A attached hereto lists all transactions in Common Shares since the filing of the Schedule 13D by the Reporting Persons other than 9,353.18 Common Shares received by a trust for which Ms. Dondero serves as trustee pursuant to the Issuer's dividend reinvestment program. Except as otherwise noted, the transactions in Common Shares were effected in the open market.
(d)	No person other than the Reporting Persons is known to have the right to receive, or the power to direct the receipt of dividends from, or proceeds from the sale of, the Common Shares.
(e)	Not applicable.
Item 7.	Material to be Filed as Exhibits.
	Exhibit 99.1 Annex A

SIGNATURE

After reasonable 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.

DONDERO JAMES D

Signature:	/s/ James D. Dondero
Name/Title:	James D. Dondero
Date:	12/10/2025

HIGHLAND GLOBAL ALLOCATION FUND

Signature:	/s/ Stephanie Vitiello
Name/Title:	Stephanie Vitiello, Chief Compliance Officer
Date:	12/10/2025

Drugcrafters, L.P.

Signature:	/s/ James D. Dondero
Name/Title:	James D. Dondero, Managing Member of the General Partner
Date:	12/10/2025

NEXPOINT ASSET MANAGEMENT, L.P.

Signature:	/s/ James D. Dondero
Name/Title:	James D. Dondero, President
Date:	12/10/2025

DONDERO NANCY MARIE

Signature:	/s/ Nancy Marie Dondero
Name/Title:	Nancy Marie Dondero
Date:	12/10/2025

FAQ

What does the Schedule 13D/A for HFRO disclose about James D. Donderos ownership?

The filing states that, as of December 10, 2025, James D. Dondero may be deemed to beneficially own 4,144,711.77 Common Shares of Highland Opportunities & Income Fund, representing approximately 7.5% of the outstanding Common Shares. This includes shares held indirectly through NexPoint, Drugcrafters, various accounts, and a trust from which he has the right to acquire beneficial ownership.

How many HFRO shares did Highland Global Allocation Fund recently purchase?

Since the last reported transaction, Highland Global Allocation Fund purchased 636,327 Common Shares of HFRO in open-market transactions. The aggregate purchase price for these shares was $4,055,613, funded with the reporting persons working capital.

What are the beneficial ownership percentages reported for the HFRO investor group?

As of December 10, 2025, the filing reports approximate ownership of 7.5% of HFRO Common Shares for James D. Dondero, 0.1% for Drugcrafters, L.P., 3.7% for Highland Global Allocation Fund, 3.7% for NexPoint Asset Management, L.P., and 3.6% for a trust for which Nancy Marie Dondero serves as trustee.

Who are the reporting persons in the HFRO Schedule 13D/A Amendment No. 2?

The Amendment is filed on behalf of James D. Dondero, Highland Global Allocation Fund (a Massachusetts business trust), Drugcrafters, L.P. (a Delaware limited partnership), NexPoint Asset Management, L.P. (a Delaware limited partnership), and Nancy Marie Dondero. These entities and individuals are collectively referred to as the reporting persons.

How many HFRO shares does Highland Global Allocation Fund beneficially own?

Highland Global Allocation Fund may be deemed to beneficially own 2,064,005 Common Shares of HFRO, representing approximately 3.7% of the outstanding Common Shares. The fund has shared voting and shared dispositive power over all of these shares.

What is NexPoint Asset Management, L.P.s reported interest in HFRO?

NexPoint Asset Management, L.P. may be deemed to beneficially own 2,064,005 Common Shares of HFRO, or about 3.7% of the outstanding Common Shares, with shared voting and shared dispositive power. These shares are held indirectly through an advised account that NexPoint manages.

How many HFRO shares are associated with the trust for which Nancy Marie Dondero is trustee?

The filing indicates that a trust for which Nancy Marie Dondero serves as trustee may be deemed to beneficially own 2,006,881.1 Common Shares of HFRO, representing approximately 3.6% of the outstanding Common Shares. The trust has shared voting and shared dispositive power over these shares.