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The following is an excerpt from a S-1 SEC Filing, filed by HIGHLAND FINANCIAL PARTNERS, L.P. on 5/1/2007.
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HIGHLAND FINANCIAL PARTNERS, L.P. - S-1 - 20070501 - MANAGEMENT
MANAGEMENT
Directors and Executive Officers
      The Board consists of seven persons, a majority of whom our board has determined are independent in accordance with the general independence standards of the New York Stock Exchange Inc. and the LP Agreement. We refer to these individuals as our independent directors. The Board will elect our officers annually, each of whom will serve at the discretion of the Board. Under the LP Agreement, directors will hold office for a one year term.
      Our directors and executive officers, their ages and titles, are as follows:
                 
Name   Age   Title   Highland Capital Title
             
James Dondero
    44     Chairman of the Board   President of General Partner
Scott F. Kavanaugh
    44     Independent Director    
John E. Urban
    43     Independent Director    
Mark Okada
    44     Director   Chief Investment Officer and Executive Vice President of General Partner
Gene C. McQuown
    51     Independent Director    
Michael P. Zarrilli
    57     Independent Director    
Todd Travers
    43     Director, Chief Executive Officer and Chief Investment Officer   Head of Structured Products
Clifford Stoops
    36     Interim Chief Financial Officer, Treasurer and Controller    
J. Kevin Ciavarra
    36     General Counsel
and Secretary
  General Counsel
Biographical Information
      Certain information regarding each of the directors and executive officers is set forth below.
  •  James Dondero, CFA, CPA, CMA has served as our Chairman since February 3, 2006. Mr. Dondero is a founding limited partner and President of the general partner of Highland Capital. Prior to Highland Capital, Mr. Dondero served as Chief Investment Officer of Protective Life’s GIC subsidiary. His portfolio management experience includes mortgage-backed securities, investment grade corporate, leveraged bank loans, emerging markets, derivatives, preferred stocks and common shares. From 1985 to 1989, he managed fixed- income funds for American Express. Prior to American Express, he completed the financial training at Morgan Guaranty Trust Company.
 
  •  Scott F. Kavanaugh has served as our director since February 3, 2006. Mr. Kavanaugh served as an Executive at Provident Funding Mortgage Corporation from February 2003 to July 2003, and an Executive Vice President, Director and Treasurer of Commercial Capital Bank from January 2000 to February 2003. He was Managing Principal and Chief Operating Officer of Financial Institutional Partners Mortgage Company and the Managing Principal and President of Financial Institutional Partners, LLC, an investment banking firm, from April 1998 to February 2003.
 
  •  John E. Urban has served as our director since February 3, 2006. Mr. Urban is the President of Urban Capital LLC, where he manages his personal assets. Until his retirement in 2001, Mr. Urban served as a Partner and Chief Operating Officer of the Fixed Income Leveraged Finance Business of Goldman Sachs in New York. He joined Goldman Sachs in Fixed Income in 1992, became a Managing Director in 1996 and was named Partner in 1998. Previously, he worked at the

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  Continental Bank as a Senior Director and NationsBank of Texas as an Assistant Vice President and Credit Analyst.
 
  •  Mark Okada, CFA has served as our director since June 16, 2006. Mr. Okada is a founding limited partner and Chief Investment Officer of the general partner of Highland Capital, where he is responsible for overseeing investment activities for various funds. Prior to Highland Capital, Mr. Okada served as Manager of Fixed Income for Protective Life’s GIC subsidiary, where he was primarily responsible for the bank loan portfolio and other risk assets from 1990 to 1993. Mr. Okada has over 19 years of experience in the leveraged finance market. From 1986 to 1990, he served as Vice President for Hibernia National Bank.
 
  •  Gene C. McQuown has served as our director since June 16, 2006. From 1989 until 2006, Mr. McQuown was employed by J.E. Robert Company as a Senior Managing Director of JER, and President of JER Investors Trust, a public mortgage REIT.
 
  •  Michael P. Zarrilli has served as our director since February 20, 2006. Mr. Zarrilli is currently Chief Executive Officer of Stanwich Capital LLC, which he founded in January 2006. Stanwich Capital LLC was formed to engage in financial and financial restructuring advisory and asset management. Previously, he was with JP Morgan and its predecessors for 32 years, most recently as Managing Director and Deputy Head of North American Credit Markets and member of its management committee.
 
  •  Todd Travers, CFA has served as our Chief Executive Officer and Chief Investment Officer since January 26, 2006. Mr. Travers has also served as our director since February 20, 2006. Mr. Travers is responsible for Highland Capital’s CDO business and is the primary portfolio manager for Highland Capital’s par debt funds. He is a member of the Credit Committee and heads a team that is responsible for structuring new transactions and implementing additional opportunities in Highland Capital’s core businesses. Formerly, Mr. Travers served as Portfolio Manager/ Portfolio Analyst from 1994 to 1998 for Highland Capital, during which time his responsibilities included managing a portion of Highland Capital’s leveraged loan and high yield debt portfolios. Prior to Highland Capital, Mr. Travers served as a Finance Manager at American Airlines.
 
  •  Cliff Stoops, CPA has served as our Interim Chief Financial Officer since March 29, 2007. Mr. Stoops has also served as our Controller since July 5, 2006. Mr. Stoops joined Highland Capital on July 5, 2006 and is responsible for the daily accounting requirements of our company and assists in the financial reporting requirements. Prior to joining Highland Capital, Mr. Stoops was a Manager at Ernst & Young LLP, where he worked for seven years and was involved in financial statement audits of various types of entities in the asset management field, including hedge funds, mutual fund advisors, and broker-dealers.
 
  •  J. Kevin Ciavarra, Esq. has served as our General Counsel and Secretary since March 29, 2007. Mr. Ciavarra has also served as Highland Capital’s General Counsel since February 2006. Mr. Ciavarra previously served as Highland Capital’s Senior Tax Counsel from March 2004 to February 2006. Prior to joining Highland Capital, Mr. Ciavarra was an attorney at the law firm of Strasburger & Price LLP from 1999 to 2004. Prior to joining Strasburger & Price LLP, Mr. Ciavarra was a Senior Associate at Coopers & Lybrand from 1997 to 1999. Mr. Ciavarra received a J.D. from the Southern Methodist University School of Law, an LL.M. in taxation from Georgetown University Law Center and a B.A. from the University of Texas at Austin.
Board Committees
      We have established the following committees of the Board: an audit committee, a compensation committee, an affiliated transaction committee and a nominating and corporate governance committee.
      Audit Committee. Our audit committee is composed of four of our independent directors, Mr. Kavanaugh, Mr. Urban, Mr. McQuown and Mr. Zarrilli. Mr. Kavanaugh chairs our audit committee and serves as our audit committee financial expert, as that term is defined by the Securities and Exchange

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Commission. The audit committee is responsible for approving our independent accountants, reviewing with our independent accountants the plans and results of the audit engagement, approving professional services provided by our independent accountants, reviewing the independence of our independent accountants and reviewing the adequacy of our internal accounting controls.
      Compensation Committee. Our compensation committee is composed of four of our independent directors, Mr. Kavanaugh, Mr. Urban, Mr. McQuown and Mr. Zarrilli. Mr. Urban chairs our compensation committee. The principal functions of the compensation committee is to (i) evaluate the performance of our officers, (ii) review the compensation payable to our officers, (iii) evaluate the performance of Highland Capital, (iv) review the compensation and fees payable to Highland Capital under our management agreement and (v) administer the issuance of any common units issued to the employees of Highland Capital who provide services to us. The LP Agreement provides that any action by the Board to change the membership of the compensation committee must be approved by the affirmative vote of a majority of the independent directors.
      Affiliated Transaction Committee. Our affiliated transaction committee is composed of four of our independent directors, Mr. Kavanaugh, Mr. Urban, Mr. McQuown and Mr. Zarrilli. Mr. Zarrilli chairs our affiliated transaction committee. The affiliated transaction committee is responsible for monitoring, reviewing and approving transactions by and between us and (i) our manager, (ii) any executive officer, (iii) director or director nominee, (iv) any 5% or more beneficial owner of any equity interest of us or our manager, (v) any member of the immediate family of any of the foregoing related persons, or (vi) any entity in which any of the foregoing persons has or will have a direct or indirect material interest.
      Nominating and Corporate Governance Committee. Our nominating and corporate governance committee is composed of four of our independent directors, Mr. Kavanaugh, Mr. Urban, Mr. McQuown and Mr. Zarrilli. Mr. McQuown chairs our nominating and corporate governance committee. The nominating and corporate governance committee is responsible for selecting, researching and nominating directors for election by our unitholders, selecting nominees to fill vacancies on the Board or a committee of the Board, developing and recommending to the Board a set of corporate governance principles and overseeing the evaluation of our the Board and our management.
Executive Compensation
Compensation Discussion and Analysis
      Because our management agreement provides that Highland Capital is responsible for managing our affairs, our executive officers, who are employees of Highland Capital, do not receive cash compensation from us for serving as our executive officers. In their capacities as officers or employees of Highland Capital, or its affiliates, they devote a portion of their time to our affairs as is required, however, for the performance of the duties of Highland Capital under the management agreement.
      Except for certain equity grants, Highland Capital compensates each of our executive officers. We pay Highland Capital a management fee, and Highland Capital uses the proceeds from the management fee in part to pay compensation to its officers and employees. Highland Capital has informed us that, because the services performed by these executive officers or employees in their capacities as such are performed primarily, but not exclusively, for us, it cannot segregate and identify that portion of the compensation awarded to, earned by or paid to our executive officers by Highland Capital that relates solely to their services to us.
      We currently maintain the Highland Financial Partners, L.P. 2006 LP Unit Incentive Plan For Non-Natural Persons, which our board of directors adopted on February 3, 2006, as amended, supplemented or restated from time to time, and the Highland Financial Partners, L.P. 2006 LP Unit Incentive Plan, which our board of directors adopted on February 3, 2006, as amended, supplemented or restated from time to time. The purpose of the plans is to provide incentives to our employees, our non-employee directors, Highland Capital and other service providers to stimulate their efforts toward our continued success, long-term growth and profitability and to attract, reward and retain key personnel.

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Summary Compensation Table
      As disclosed throughout this registration statement, Highland Capital has been responsible for our management. Our executive officers, in their capacity as our officers, do not receive any cash compensation from us. We pay a management fee to Highland Capital. In turn, in their capacity as officers of Highland Capital, our executive officers receive compensation from Highland Capital for the performance of their duties to Highland Capital on our behalf, as well as on behalf of the several other entities managed by Highland Capital. Because the services performed by the officers and employees of Highland Capital were not performed exclusively for us, Highland Capital cannot segregate and identify that portion of the compensation awarded to, earned by or paid to the executive officers by Highland Capital that relates solely to such persons’ services for us. Our executive officers are eligible to receive equity awards under our LP Unit Incentive Plan for Non-Natural Persons, as determined in the sole discretion of our compensation committee.
      The following table sets forth equity awards granted under our LP Unit Incentive Plan for Non-Natural Persons, received by our Chief Executive Officer and Chief Financial Officer for the year ended December 31, 2006. For the year ended December 31, 2006, other than the two officers listed below, we did not have any other named executive officers.
Summary Compensation Table for 2006
                                   
        Stock Awards   Option Awards   Total
Name and Principal Position   Year   ($)(1)   ($)(1)   ($)
                 
Todd Travers
    2006     $ 666,623     $ 86,247     $ 752,870  
  Chief Executive Officer; Director                                
Chad Schramek
    2006       n/a       n/a       n/a  
  Interim Chief Financial Officer(2)                                
 
(1)  The amount reported in this column reflects the dollar amount recognized for financial statement purposes for the fiscal year ended December 31, 2006, in accordance with FAS 123R.
 
(2)  Mr. Schramek’s status as Interim Chief Financial Officer was terminated on December 31, 2006.
Grants of Plan-Based Awards Table for 2006
                                         
        All Other Stock   All Other Option       Grant Date Fair
        Awards: Number   Awards: Number of   Exercise or Base   Value of Stock
        of Shares of Stock   Securities   Price of Option   and Option
        or Units   Underlying Options   Award   Award
Name and Principal Position   Grant date   (#)(1)   (#)(2)   ($)   ($)(3)
                     
Todd Travers; Chief Executive Officer; Director
    02/03/06       66,667       66,667     $ 15.00     $ 1,000,005  
Todd Travers; Chief
Executive Officer; Director
    10/26/06       50,000       50,000     $ 16.50     $ 825,000  
Chad Schramek: Interim Chief Financial Officer(4)
    n/a       n/a       n/a       n/a       n/a  
 
(1)  Restricted units vest in one-third increments on the first three anniversaries of the grant date. Holders of restricted units have the right to receive distributions pursuant to the LP Agreement.
 
(2)  Options vest in one-third increments on the first three anniversaries of the grant date.
 
(3)  The grant date fair values were computed in accordance with FAS 123R.
 
(4)  Mr. Schramek’s status as Interim Chief Financial Officer terminated on December 31, 2006.

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Outstanding Equity Awards at Fiscal Year End
                                   
    Options Awards   Stock Awards
         
    Number of Shares       Number of Shares    
    Acquired On   Value Realized   Acquired On   Value Realized
    Exercise   On Exercise   Vesting   on Vesting
Name   (#)   ($)   (#)   (S)
                 
Todd Travers
    n/a       n/a       22,222     $ 400,000 (2)
  Chief Executive Officer; Director                                
Chad Schramek
    n/a       n/a       n/a       n/a  
  Interim Chief Financial Officer                                
 
(1)  None of the Company’s named executive officers exercised any stock options during the fiscal year ended December 31, 2006.
 
(2)  Value assumed to be approximately $18.00 per share.
Outstanding Equity Awards at Fiscal Year-End Table
                                         
    Option Awards   Stock Awards
         
    Number of Securities   Option       Number of Shares or   Market Value of Shares
    Underlying Unexercised   Exercise   Option   Units of Stock That   or Units of Stock That
    Unearned Options(#)   Price   Expiration   Have Not Vested   Have Not Vested
Name   Unexercisable   ($)   Date   (#)   ($)
                     
Todd Travers
    66,667 (1)     15.00       2/3/2016       66,667 (1)     1,000,005  
Todd Travers
    50,000 (2)     16.50       10/26/2016       50,000 (2)     825,000  
Chad Schramek
    n/a       n/a       n/a       n/a       n/a  
 
(1)  Units of stock and options vest in one-third increments on the first three anniversaries of date of grant, February 3, 2006.
 
(2)  Units of stock and options vest in one-third increments on the first three anniversaries of date of grant, October 26, 2006.
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