Dr. Bob Froehlich
About Dr. Bob Froehlich
Independent Trustee of Highland Opportunities and Income Fund (HFRO) since August 2017; born April 28, 1953. He is designated as one of the Trustees elected solely by holders of the Fund’s Preferred Shares, serves as Chairperson of the Governance and Compliance Committee, and is a member of both the Audit and Qualified Legal Compliance Committee and the Administration and Operations Committee. The Board met eight times in 2024 and each Trustee met at least the 75% attendance threshold; Froehlich is classified as independent under the 1940 Act and NYSE Rule 303A.02. The proxy highlights his significant financial industry experience, managerial/executive background, and prior audit committee service as core credentials .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| KC Concessions, Inc. | Director | Jan 2013 – Mar 2025 | Director role concluded March 2025 |
| Kane County Cougars Baseball Club | Chairman & Owner | Jan 2013 – Mar 2025 | Club ownership/oversight; concluded March 2025 |
| Midwest League of Professional Baseball Clubs, Inc. | Director | Jan 2013 – Dec 2021 | Board service in professional baseball league |
| Kane County Cougars Foundation, Inc. | Director; Executive Director | Director: Jan 2013 – Mar 2025; Executive Director: Jul 2023 – Mar 2025 (remains Director thereafter) | Community/non-profit governance and operations leadership |
| Galen Robotics, Inc. | Director | Aug 2016 – Sep 2023 | Private medical robotics board experience |
External Roles
| Organization | Role | Tenure | Notes |
|---|---|---|---|
| American Sports Enterprise, Inc. | Director | Since Jan 2013 | Ongoing board role |
| Vault Data, LLC | Director & Special Advisor | Since Feb 2018 | Data/technology advisory and governance |
| American Association of Professional Baseball, Inc. | Director | Since Feb 2021 | Independent league governance |
| National Amateur Fall Baseball Federation | Director | Since Dec 2023 | Amateur baseball governance |
Board Governance
- Board composition: five Trustees (four independent; one interested). Chairman: Ethan Powell (Independent). Independent Trustees meet as needed with independent counsel without management present .
- Preferred Share representation: Froehlich is designated as one of the Trustees elected solely by Preferred Shareholders; his Class II seat is up for re-election at the 2026 annual meeting by Preferred holders only .
- Attendance and engagement: Board convened 8 times in 2024; each Trustee attended at least 75% of Board and Committee meetings served .
- Risk and valuation oversight: The Audit Committee oversees financial reporting and audits and also oversees valuations under Rule 2a-5, with the Adviser designated as valuation designee; Audit met 5 times in 2024 .
- Committee structure and 2024 activity (Froehlich’s roles in bold):
Committee Role 2024 Meetings Audit & Qualified Legal Compliance Member 5 Governance & Compliance Chairperson 5 Administration & Operations Member 5
Fixed Compensation
- Structure (2024): Annual Trustee retainer $150,000; no meeting fees; Chairperson of each Committee receives additional $10,000; Chairman of the Board receives $20,000; no pension/retirement plan .
- Structure (2023 comparator): Annual retainer $150,000; additional $10,000 for Chairman of the Board and $10,000 for Audit Committee Chair; no pension/retirement plan .
| Year | Component | Amount | Notes |
|---|---|---|---|
| 2024 | Annual Trustee Retainer | $150,000 | Paid across Fund Complex; allocated by net assets |
| 2024 | Committee Chair Fee | $10,000 | Per committee chair; Froehlich as Governance & Compliance Chair |
| 2024 | Chairman of the Board Fee | $20,000 | Applies to Board Chair (not Froehlich) |
| 2023 | Annual Trustee Retainer | $150,000 | Paid across Fund Complex |
| 2023 | Chairman of the Board Fee | $10,000 | Not applicable to Froehlich (not Chair) |
| 2023 | Audit Chair Fee | $10,000 | For Audit Chair (not Froehlich) |
| Dr. Bob Froehlich – Reported Compensation | 2023 | 2024 |
|---|---|---|
| Aggregate Compensation From the Fund | $52,269 | $68,289 |
| Aggregate Compensation From the Fund Complex | $150,000 | $160,000 |
| Pension/Retirement Benefits | $0 | $0 |
Performance Compensation
| Plan/Metric | Disclosure |
|---|---|
| Stock awards (RSUs/PSUs) | None disclosed in the proxy; Trustee pay described as cash retainers and chair fees; no equity plan referenced . |
| Option awards | None disclosed . |
| Bonus/Performance metrics (TSR, EBITDA, ESG) | None disclosed for Trustees . |
| Clawbacks/COC/Severance | Not applicable to independent Trustees; not disclosed . |
Other Directorships & Interlocks
- No current public company directorships are disclosed for Froehlich; disclosed roles are private company, league, or non-profit boards (see External Roles) .
- No beneficial ownership by Independent Trustees or their immediate family of securities issued by the Adviser, principal underwriter, or related parties, reducing interlock/conflict risk .
Expertise & Qualifications
- Significant experience in the financial industry; substantial managerial and executive experience; extensive board service, including audit committees—cited as key attributes supporting his Board role .
Equity Ownership
| As of Date | Holder | HFRO Share Ownership | Aggregate Ownership Across Fund Complex | Notes |
|---|---|---|---|---|
| Feb 28, 2025 | Dr. Bob Froehlich | $10,001–$50,000 (dollar range) | Over $100,000 | Ranges reported; no share count disclosed |
| Feb 28, 2025 | All Trustees & Officers (group) | <0.01% of outstanding shares | — | Indicates modest alignment at group level |
| Feb 28, 2025 | Independent Trustees/adjoining family | — | — | None owned securities of Adviser/underwriter/affiliates |
Governance Assessment
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Strengths:
- Independence and structure: Froehlich is independent under the 1940 Act and NYSE rules; Audit and Governance & Compliance Committees are chaired by Independent Trustees; Independent Trustees meet with independent counsel without management present .
- Engagement: Board (8 meetings) and committees (5 each) indicate regular cadence; all Trustees met at least 75% attendance .
- Conflict oversight: As Governance & Compliance Chair, Froehlich leads board oversight of legal/regulatory compliance and potential conflicts between the Fund and NexPoint related to securities/litigation—central to investor protection .
- Valuation oversight: Audit Committee oversight of valuations under Rule 2a‑5 provides a defined control framework around fair value determinations .
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Alignment and Risks:
- Low direct ownership: Froehlich’s reported HFRO ownership is $10k–$50k, and Trustees/officers as a group own <0.01% of shares—alignment exists but is modest (common in registered fund complexes) .
- Cash-only director pay: Compensation is retainer-based cash with chair adders; no equity/long-term performance components disclosed—limited direct pay-for-performance linkage for directors .
- Capital structure nuance: Froehlich’s seat is elected solely by Preferred Shareholders (Class II), which can create a different constituency focus versus common shareholders; this is permitted by HFRO’s governing documents .
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Compensation governance evolution:
- Chair fees changed YoY: 2023 structure paid $10k to Board Chair and Audit Chair; 2024 provides $20k to Board Chair and $10k to each Committee Chair—clarifies committee leadership compensation while holding base retainer flat .
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Disclosures:
- No related-party holdings by Independent Trustees or immediate family in the Adviser/underwriter entities were disclosed, mitigating direct financial interlock concerns .
- Section 16 compliance noted (prior year proxy), with no delinquencies indicated for officers/Trustees; no Form 4 trading detail provided in the HFRO proxy .
RED FLAGS to monitor: very low group ownership (<0.01%); absence of equity-based director compensation; and the preferred-shareholder election mechanism for Froehlich’s seat, which may be perceived as a structural alignment nuance relative to common shareholders .