SEC Form SC 13D/A filed by NexPoint Real Estate Finance, Inc. (Amendment)

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

SCHEDULE 13D

UNDER THE SECURITIES EXCHANGE ACT OF 1934

(Amendment No. 2)*

NEXPOINT REAL ESTATE FINANCE, INC.

(Name of Issuer)

Common Stock, par value $0.01 per share

(Title of Class of Securities)

65342V101

(CUSIP Number)

D.C. Sauter, General Counsel

NexPoint Advisors, L.P.

300 Crescent Court, Suite 700

Dallas, TX 75201

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

September 8, 2021

(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. ☐

SCHEDULE 13D

This Amendment No. 2 (this “Amendment”) is being filed on behalf of James D. Dondero, NexPoint Advisors, L.P., a Delaware limited partnership (“NexPoint Advisors”), Highland Capital Management Fund Advisors, L.P., a Delaware limited partnership (“HCMFA”), and Nancy Marie Dondero (collectively, the “Reporting Persons”), and amends the Schedule 13D filed on April 15, 2020 and subsequently amended on August 13, 2020. This Amendment updates the stock ownership information for the Schedule 13D. The Schedule 13D is supplementally amended as follows:

Item 3. Source and Amount of Funds or Other Consideration.

All shares of Common Stock purchased in open market or private transactions between August 12, 2020 and September 8, 2021 were purchased with the Reporting Persons’ working capital or the working capital of affiliated funds, as applicable, including cash proceeds from the redemption of common limited partnership units (“OP Units”) of NexPoint Real Estate Finance Operating Partnership, L.P., the operating partnership of the Issuer. An aggregate of $31,611,631.01 was paid in connection with these purchases. In addition, between August 12, 2020 and September 8, 2021, a trust of which Nancy Marie Dondero is trustee was issued 13,136.58 shares of Common Stock in connection with dividend reinvestments in the Issuer, and on June 24, 2021, James D. Dondero was issued 17,558 shares of Common Stock upon the vesting of 17,558 restricted stock units granted to him pursuant to a long-term incentive plan of the Issuer.

Item 4. Purpose of Transaction.

Between August 12, 2020 and September 8, 2021, the Reporting Persons purchased an aggregate of 12,795 shares of Common Stock in open market transactions for an aggregate purchase price of $194,423.47. Between August 12, 2020 and September 8, 2021, a trust of which Nancy Marie Dondero is trustee was issued 13,136.58 shares of Common Stock in connection with dividend reinvestments in the Issuer. On June 24, 2021, James D. Dondero was issued 17,558 shares of Common Stock upon the vesting of 17,558 restricted stock units granted to him pursuant to a long-term incentive plan of the Issuer. On September 8, 2021, the Reporting Persons purchased an aggregate of 1,479,132 shares of Common Stock for an aggregate purchase price of $31,417,207.54, using the cash proceeds from a redemption of approximately the same number of OP Units.

The Reporting Persons beneficially own 3,642,543.55 OP Units that are redeemable, subject to certain requirements, for cash or, at the election of the Issuer, for shares of the Issuer’s common stock on a one-for-one basis. Stockholders approved the issuance of shares of Common Stock in connection with the redemption of OP Units held by the Reporting Persons at the Company’s 2021 annual meeting. As a result, if OP Units are redeemed for cash, the cash received may be used to purchase additional shares of Common Stock in the Issuer.

Item 5. Interest in Securities of the Issuer.

(a) As of September 8, 2021, (i) James D. Dondero may be deemed to beneficially own 1,865,051.58 shares of Common Stock, which represents approximately 20.8% of the outstanding Common Stock, (ii) NexPoint Advisors may be deemed to beneficially own 486,540 shares of Common Stock, which represents approximately 5.4% of the outstanding Common Stock, (iii) HCMFA may be deemed to beneficially own 1,197,045 shares of Common Stock, which represents approximately 13.3% of the outstanding Common Stock and (iv) Nancy Marie Dondero, in her capacity as trustee of a trust, may be deemed to beneficially own 163,908.58 shares of Common Stock, which represents approximately 1.8% of the outstanding Common Stock. James D. Dondero has the right to acquire beneficial ownership of all shares of Common Stock owned by the trust referred to in the preceding sentence.

(b)

(c) Annex A attached hereto lists all transactions in Common Stock during the past 60 days by the Reporting Persons. The shares of Common Stock were purchased in private transactions.

(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 Stock.

(e) Not applicable.

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.

Dated: September 10, 2021

ANNEX A

TRANSACTIONS

The following table sets forth all transactions with respect to the Common Stock effected in the last sixty (60) days by the Reporting Persons or on behalf of the Reporting Persons in respect of the shares of Common Stock, inclusive of any transactions effected through 4:00 p.m., New York City time, on September 8, 2021.