N-CSR 1 wahiof-efp18900_ncsr.htm WESTERN ASSET HIGH INCOME OPPORTUNITY FUND INC - N-CSR

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-07920

Western Asset High Income Opportunity Fund Inc.

(Exact name of registrant as specified in charter)

One Madison Avenue, 17th Floor, New York, NY 10010

(Address of principal executive offices) (Zip code)

Marc A. De Oliveira

Franklin Templeton

100 First Stamford Place

Stamford, CT 06902

(Name and address of agent for service)

Registrant’s telephone number, including area code: 1-888-777-0102

Date of fiscal year end: September 30

Date of reporting period: September 30, 2025

ITEM 1. | REPORT TO STOCKHOLDERS

(a)

Annual Report
September 30, 2025
WESTERN ASSET
HIGH INCOME
OPPORTUNITY FUND
INC. (HIO)

Fund objectives
The Fund seeks high current income. Capital appreciation is a secondary objective.
In seeking to fulfill its investment objectives, the Fund invests, under normal market conditions, at least 80% of its net assets in high-yield securities and up to 20% in common stock equivalents, including options, warrants and rights.
What’s inside

Letter from the president | III
Fund overview | 1
Fund at a glance | 6
Fund performance | 7
Schedule of investments | 9
Statement of assets and liabilities | 29
Statement of operations | 30
Statements of changes in net assets | 31
Financial highlights | 32
Notes to financial statements | 33
Report of independent registered public accounting firm | 47
Board approval of management and subadvisory agreements | 48
Additional information | 55
Annual chief executive officer and principal financial officer certifications | 61
Other shareholder communications regarding accounting matters | 62
Summary of information regarding the Fund | 63
Dividend reinvestment plan | 75
Important tax information | 77

II
Western Asset High Income Opportunity Fund Inc.

Letter from the president
Dear Shareholder,
We are pleased to provide the annual report of Western Asset High Income Opportunity Fund Inc. for the twelve-month reporting period ended September 30, 2025. Please read on for a detailed look at prevailing economic and market conditions during the Fund’s reporting period and to learn how those conditions have affected Fund performance.
As always, we remain committed to providing you with excellent service and a full spectrum of investment choices. We also remain committed to supplementing the support you receive from your financial advisor. One way we accomplish this is through our website, www.franklintempleton.com. Here you can gain immediate access to market and investment information, including:
•
Fund prices and performance,
•
Market insights and commentaries from our portfolio managers, and
•
A host of educational resources.
We look forward to helping you meet your financial goals.
Sincerely,
Jane Trust, CFA
President and Chief Executive Officer
October 31, 2025
Western Asset High Income Opportunity Fund Inc.

III

(This page intentionally left blank.)

Fund overview
Q. What is the Fund’s investment strategy?
A. The Fund seeks high current income. Capital appreciation is a secondary objective. In seeking to fulfill its investment objectives, the Fund invests, under normal market conditions, at least 80% of its net assets in high yield securities and up to 20% in common stock equivalents, including options, warrants and rights.
We employ an actively managed approach that is risk-aware and incorporates top-down macroeconomic views with industry sector insights and bottom-up credit research to derive the general framework for the Fund’s predominantly non-investment grade credit mandate. This framework provides the foundation for how the portfolio is positioned with respect to risk (aggressive, neutral, conservative), as well as sector overweights and underweights.
Risk and weightings are reviewed on a regular basis. Our bottom-up process provides the basis for populating the targeted industry weightings through individual credit selection. Analysts work closely with investment professionals to determine which securities provide the best risk/reward relationship within their respective sectors. The research team focuses on key fundamental measures such as leverage, cash flow adequacy, liquidity, amortization schedule, underlying asset value and management integrity/track record.
At Western Asset Management Company, LLC (Western Asset), the Fund’s subadviser, we utilize a fixed income team approach, with decisions derived from interaction among various investment management sector specialists. The sector teams are comprised of Western Asset’s senior portfolio management personnel, research analysts and an in-house economist. Under this team approach, management of client fixed income portfolios will reflect a consensus of interdisciplinary views within the Western Asset organization. The individuals responsible for development of investment strategy, day-to-day portfolio management, oversight and coordination of the Fund are Walter Kilcullen, Michael C. Buchanan and Christopher F. Kilpatrick.
Q. What were the overall market conditions during the Fund’s reporting period?
A. The overall U.S. fixed income market experienced periods of volatility but generated a positive return over the twelve months ended September 30, 2025. The market was driven by several factors, including a generally resilient economy, moderating but “sticky” inflation, shifting monetary policy of U.S. Federal Reserve (Fed), a U.S. trade war, and several geopolitical issues.
The Fed lowered interest rates in September 2024 (the first reduction since 2020) and again in November and December 2024. The December reduction put the federal funds target rate at 4.25%-4.50%, the lowest level since December 2022. The Fed then remained on hold at its first five meetings in 2025, as it weighed the impact of the President’s tariffs on the economy and inflation. Then, as expected, the Fed lowered rates at a range between 4.00% and 4.25% at its September 2025 meeting, citing concerns over the labor market.
The two-year U.S. Treasury yield began the reporting period at 3.66% and ended at 3.60%, whereas the ten-year Treasury yield began the reporting period at 3.81% and ended at
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

1

Fund overview (cont’d)
4.16%. All told, the Bloomberg U.S. Aggregate Index i returned 2.88% for the twelve months ended September 30, 2025. Over the fiscal year, the Bloomberg U.S. Corporate High Yield—2% Issuer Cap Index ii and the JPMorgan Emerging Markets Bond Index Global (EMBI Global)iii returned 7.41% and 7.78%, respectively.
Q. How did we respond to these changing market conditions?
A. A number of adjustments were made to the Fund’s portfolio during the reporting period. From a sector perspective, we added to our high-yield corporate credit exposure (mainly issuers within the basic industry 1, energy and transportation sectors) and ended the period with an overweight of 5.7%. We also increased our collateralized loan obligation (CLO) exposure to a modest mid-single digit percentage of the portfolio and added slightly to bank loans, which we believe still offer attractive income opportunities and are typically secured to an issuers’ assets. We decreased our exposure to emerging markets, mainly U.S. dollar-denominated corporates.
From a quality ratings perspective, we’ve been adding mainly single B opportunities, while reducing BB rated exposure. We also reduced our overweight to investment-grade rated issuers, as it has continued to grow through upgrades over the past several years. We have experienced “rising star” activity in the natural gas space, with producer Southwestern Energy Company being upgraded from below investment-grade to investment-grade, as an example. We ended the reporting period with the portfolio at roughly 81% concentrated among investment-grade, BB and single B rated fixed income securities. In terms of duration, we ended the period with an overweight versus the benchmark.
Currency forwards, which were used to help manage the Fund’s currency exposures, added to performance. Single-name and index credit default swaps (HY.CDX), which were used to help manage the Fund’s credit exposures, also added to performance.
Performance review
For the twelve months ended September 30, 2025, Western Asset High Income Opportunity Fund Inc. returned 7.05% based on its net asset value (NAV)iv and 5.53% based on its New York Stock Exchange (NYSE) market price per share. The Fund’s unmanaged benchmark, the Bloomberg U.S. Corporate High Yield—2% Issuer Cap Index, returned 7.41% for the same period.
The Fund has a practice of seeking to maintain a relatively stable level of distributions to shareholders. This practice has no impact on the Fund’s investment strategy and may reduce the Fund’s NAV. The Fund’s manager believes the practice helps maintain the Fund’s competitiveness and may benefit the Fund’s market price and premium/discount to the Fund’s NAV.
1
Basic Industry consists of the following industries: chemicals, metals & mining and paper.

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Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

During the twelve-month period, the Fund made distributions to shareholders totaling $0.43 per share of which $0.10 will be treated as a return of capital for tax purposes.* The performance table shows the Fund’s twelve-month total return based on its NAV and market price as of September 30, 2025. Past performance is no guarantee of future results.

Performance Snapshot as of September 30, 2025
Price Per Share | 12-Month Total Return**
$4.08 (NAV) | 7.05 %†
$3.84 (Market Price) | 5.53 %‡

All figures represent past performance and are not a guarantee of future results.
** Total returns are based on changes in NAV or market price, respectively. Returns reflect the deduction of all Fund expenses, including management fees, operating expenses, and other Fund expenses. Returns do not reflect the deduction of brokerage commissions or taxes that investors may pay on distributions or the sale of shares.
† Total return assumes the reinvestment of all distributions, including returns of capital, at NAV.
‡ Total return assumes the reinvestment of all distributions, including returns of capital, in additional shares in accordance with the Fund’s Dividend Reinvestment Plan.
Q. What were the leading contributors to performance?
A. Within our developed market high-yield allocation, several positions were rewarded during the reporting period. Examples include overweight positions in EchoStar, Weight Watchers International and First Quantum Minerals, to name a few. Our positioning in a stressed company that pursued a Liability Management Exercise (LME), Weight Watchers International, was beneficial.
Within our investment-grade credit allocation, several issuers performed well fundamentally. Energy overweights to El Paso, Williams Companies and Occidental Petroleum benefited performance. Communications overweights to Charter and Sprint Capital also outperformed, as did our positioning in hospital operator HCA.
Within our emerging markets allocation, an overweight to several issuers was beneficial to performance. Examples include our overweight in global generic drug manufacturer Teva Pharmaceuticals, which was rewarded again, as well as Shelf Drilling Holdings in the United Arab Emirates and Ecopetrol in Colombia. Lastly, our sovereign bond exposure to the Republic of Angola was rewarded.
Q. What were the leading detractors from performance?
A. The Fund’s largest detractor from performance was its overweight allocation to several LME issuers. Specifically, our overweights to Ardagh Group, Spirit Airlines, and CSC Holdings, a subsidiary of Altice USA, were headwind for returns. Additionally, our position in auto parts supplier First Brands was a detractor as the company filed for Chapter 11
*
For the tax character of distributions paid during the fiscal year ended September 30, 2025, please refer to page 46 of this report.
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

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Fund overview (cont’d)
bankruptcy protection in September 2025. Within our emerging markets allocation, an overweight to Mexican local sovereign debt detracted from performance.
Looking for additional information?
The Fund is traded under the symbol “HIO” and its closing market price is available in most newspapers under the NYSE listings. The daily NAV is available online under the symbol “XHIOX” on most financial websites. Barron’s and The Wall Street Journal’s Monday edition both carry closed-end fund tables that provide additional information. In addition, the Fund issues a quarterly press release that can be found on most major financial websites as well as www.franklintempleton.com.
In a continuing effort to provide information concerning the Fund, shareholders may call 1-888-777-0102 (toll free), Monday through Friday from 8:00 a.m. to 5:30 p.m. Eastern Time, for the Fund’s current NAV, market price and other information.
Thank you for your investment in the Western Asset High Income Opportunity Fund Inc. As always, we appreciate that you have chosen us to manage your assets and we remain focused on achieving the Fund’s investment goals.
Sincerely,
Western Asset Management Company, LLC
October 24, 2025
RISKS: The Fund is a diversified closed-end management investment company designed primarily as a long-term investment and not as a trading vehicle. The Fund is not intended to be a complete investment program and, due to the uncertainty inherent in all investments, there can be no assurance that the Fund will achieve its investment objectives. The Fund’s common stock is traded on the New York Stock Exchange. Similar to stocks, the Fund’s share price will fluctuate with market conditions and, at the time of sale, may be worth more or less than the original investment. Shares of closed-end funds often trade at a discount to their net asset value. Diversification does not assure against market loss. The Fund’s investments are subject to a number of risks, such as credit risk, inflation risk and interest rate risk. The Fund may invest in lower-rated high yield bonds, commonly known as “junk bonds,” which are subject to greater credit risk (risk of default) and liquidity risk than higher-rated obligations. The Fund is also permitted purchases of equity securities. Equity securities generally have greater price volatility than fixed income securities. As interest rates rise, bond prices fall, reducing the value of the Fund’s holdings. The Fund may use derivatives, such as options and futures, which can be illiquid, may disproportionately increase losses, and have a potentially large impact on Fund performance. In addition, the Fund may invest in foreign securities, which are subject to certain risks of overseas investing, including currency fluctuations and changes in political, social and economic conditions, which could result in significant fluctuations. These risks are magnified in emerging markets. Emerging market countries tend to have economic, political and legal systems that are less developed and are less stable than those of more developed countries. The market values of securities or other assets will fluctuate, sometimes sharply and unpredictably, due to

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Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

changes in general market conditions, overall economic trends or events, governmental actions or intervention, actions taken by the U.S. Federal Reserve or foreign central banks, market disruptions caused by trade disputes or other factors, political developments, armed conflicts, economic sanctions and countermeasures in response to sanctions, major cybersecurity events, investor sentiment, the global and domestic effects of a pandemic, and other factors that may or may not be related to the issuer of the security or other asset. The Fund may also invest in money market funds, including funds affiliated with the Fund’s manager and subadvisers. For more information on Fund risks, see Summary of information regarding the Fund - Principal Risk Factors in this report.
Portfolio holdings and breakdowns are as of September 30, 2025, and are subject to change and may not be representative of the portfolio managers’ current or future investments. Please refer to pages 9 through 28 for a list and percentage breakdown of the Fund’s holdings.
The mention of sector breakdowns is for informational purposes only and should not be construed as a recommendation to purchase or sell any securities. The information provided regarding such sectors is not a sufficient basis upon which to make an investment decision. Investors seeking financial advice regarding the appropriateness of investing in any securities or investment strategies discussed should consult their financial professional. The Fund’s top five sector holdings (as a percentage of net assets) as of September 30, 2025, were: consumer discretionary (16.9%), energy (16.7%), communication services (16.3%), industrials (11.6%) and financials (9.1%). The Fund’s portfolio composition is subject to change at any time.
All investments are subject to risk including the possible loss of principal. Past performance is no guarantee of future results. All index performance reflects no deduction for fees, expenses or taxes. Please note that an investor cannot invest directly in an index.
The information provided is not intended to be a forecast of future events, a guarantee of future results or investment advice. Views expressed may differ from those of the firm as a whole.
i
The Bloomberg U.S. Aggregate Index is a broad-based bond index comprised of government, corporate, mortgage- and asset-backed issues, rated investment grade or higher, and having at least one year to maturity.
ii
The Bloomberg U.S. Corporate High Yield—2% Issuer Cap Index is an index of the 2% Issuer Cap component of the Bloomberg U.S. Corporate High Yield Index, which covers the U.S. dollar-denominated, non-investment grade, fixed-rate, taxable corporate bond market.
iii
The JPMorgan Emerging Markets Bond Index Global (EMBI Global) tracks total returns for U.S. dollar-denominated debt instruments issued by emerging market sovereign and quasi-sovereign entities: Brady bonds, loans, Eurobonds and local market instruments.
iv
Net asset value (NAV) is calculated by subtracting total liabilities, including liabilities associated with financial leverage (if any), from the closing value of all securities held by the Fund (plus all other assets) and dividing the result (total net assets) by the total number of shares of common stock outstanding. The NAV fluctuates with changes in the market prices of securities in which the Fund has invested. However, the price at which an investor may buy or sell shares of the Fund is the Fund’s market price as determined by supply of and demand for the Fund’s shares.
Important data provider notices and terms available at www.franklintempletondatasources.com.
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

5

Fund at a glance† (unaudited)
Investment breakdown (%) as a percent of total investments
†
The bar graph above represents the composition of the Fund’s investments as of September 30, 2025, and September 30, 2024, and does not include derivatives, such as swap contracts. The Fund is actively managed. As a result, the composition of the Fund’s investments is subject to change at any time.

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Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

Fund performance (unaudited)

Net Asset Value
Average annual total returns 1 |
Twelve Months Ended 9/30/25 | 7.05 %
Five Years Ended 9/30/25 | 3.63
Ten Years Ended 9/30/25 | 4.96
Cumulative total returns 1 |
9/30/15 through 9/30/25 | 62.19 %

Market Price
Average annual total returns 2 |
Twelve Months Ended 9/30/25 | 5.53 %
Five Years Ended 9/30/25 | 4.50
Ten Years Ended 9/30/25 | 6.62
Cumulative total returns 2 |
9/30/15 through 9/30/25 | 89.80 %

All figures represent past performance and are not a guarantee of future results. Returns reflect the deduction of all Fund expenses, including management fees, operating expenses, and other Fund expenses. Returns do not reflect the deduction of brokerage commissions or taxes that investors may pay on distributions or the sale of shares.

1 | Assumes the reinvestment of all distributions, including returns of capital, if any, at net asset value.
2 | Assumes the reinvestment of all distributions, including returns of capital, if any, in additional shares in accordance with the Fund’s Dividend Reinvestment Plan.

Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

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Fund performance (unaudited) (cont’d)
Historical performance
Value of $10,000 invested in
Western Asset High Income Opportunity Fund Inc. vs. Bloomberg U.S. Corporate High Yield — 2% Issuer Cap Index† — September 2015 - September 2025
All figures represent past performance and are not a guarantee of future results. Returns reflect the deduction of all Fund expenses, including management fees, operating expenses, and other Fund expenses. Returns do not reflect the deduction of brokerage commissions or taxes that investors may pay on distributions or the sale of shares.
†
Hypothetical illustration of $10,000 invested in Western Asset High Income Opportunity Fund Inc. on September 30, 2015, assuming the reinvestment of all distributions, including returns of capital, if any, at net asset value and also assuming the reinvestment of all distributions, including returns of capital, if any, in additional shares in accordance with the Fund’s Dividend Reinvestment Plan through September 30, 2025. The hypothetical illustration also assumes a $10,000 investment in the Bloomberg U.S. Corporate High Yield — 2% Issuer Cap Index. The Bloomberg U.S. Corporate High Yield — 2% Issuer Cap Index (the “Index”) is an index of the 2% Issuer Cap component of the Bloomberg U.S. Corporate High Yield Index, which covers the U.S. dollar-denominated, non-investment grade, fixed-rate, taxable corporate bond market. The Index is unmanaged. Please note that an investor cannot invest directly in an index.

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Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

Schedule of investments
September 30, 2025
Western Asset High Income Opportunity Fund Inc.
(Percentages shown based on Fund net assets)

Security |  | Rate | Maturity Date | Face Amount† | Value
Corporate Bonds & Notes — 82.3%
Communication Services — 15.1%
Diversified Telecommunication Services — 2.3%
Altice Financing SA, Senior Secured Notes | 5.000% | 1/15/28 | 1,050,000 | $817,267 (a)
Altice Financing SA, Senior Secured Notes | 5.750% | 8/15/29 | 4,690,000 | 3,533,141 (a)
Altice France Holding SA, Senior Secured Notes | 8.000% | 5/15/27 | 720,000 EUR | 306,851 *(b)(c)
Altice France Holding SA, Senior Secured Notes | 10.500% | 5/15/27 | 2,770,000 | 1,004,617 *(a)(b)
Altice France Holding SA, Senior Secured Notes | 6.000% | 2/15/28 | 1,230,000 | 445,496 *(a)(b)
Altice France SA, Senior Secured Notes | 5.125% | 7/15/29 | 750,000 | 644,288 (a)
Altice France SA, Senior Secured Notes | 5.500% | 10/15/29 | 1,890,000 | 1,644,180 (a)
Level 3 Financing Inc., Senior Secured Notes | 6.875% | 6/30/33 | 430,000 | 438,606 (a)
Total Diversified Telecommunication Services | 8,834,446
Entertainment — 1.3%
Banijay Entertainment SAS, Senior Secured Notes | 8.125% | 5/1/29 | 1,830,000 | 1,902,192 (a)
Warnermedia Holdings Inc., Senior Notes | 4.279% | 3/15/32 | 651,000 | 597,292
Warnermedia Holdings Inc., Senior Notes | 5.050% | 3/15/42 | 3,040,000 | 2,428,793
Total Entertainment | 4,928,277
Media — 7.8%
AMC Networks Inc., Senior Secured Notes | 10.250% | 1/15/29 | 700,000 | 738,238 (a)
CCO Holdings LLC/CCO Holdings Capital Corp., Senior Notes | 4.500% | 5/1/32 | 1,360,000 | 1,238,540
CCO Holdings LLC/CCO Holdings Capital Corp., Senior Notes | 4.250% | 1/15/34 | 4,810,000 | 4,161,554 (a)
Charter Communications Operating LLC/ Charter Communications Operating Capital Corp., Senior Secured Notes | 3.850% | 4/1/61 | 8,520,000 | 5,314,451
Clear Channel Outdoor Holdings Inc., Senior Secured Notes | 7.125% | 2/15/31 | 840,000 | 868,889 (a)
DirecTV Financing LLC, Senior Secured Notes | 8.875% | 2/1/30 | 450,000 | 445,037 (a)
DirecTV Financing LLC/DirecTV Financing Co-Obligor Inc., Senior Secured Notes | 10.000% | 2/15/31 | 1,260,000 | 1,259,095 (a)
DISH DBS Corp., Senior Notes | 5.125% | 6/1/29 | 2,768,000 | 2,369,449
DISH Network Corp., Senior Secured Notes | 11.750% | 11/15/27 | 1,200,000 | 1,270,892 (a)
EchoStar Corp., Senior Secured Notes | 10.750% | 11/30/29 | 3,795,850 | 4,179,041
EchoStar Corp., Senior Secured Notes (6.750% Cash or 6.750% PIK) | 6.750% | 11/30/30 | 2,111,367 | 2,178,350 (d)
EW Scripps Co., Senior Secured Notes | 9.875% | 8/15/30 | 870,000 | 817,420 (a)

See Notes to Financial Statements.
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

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Schedule of investments (cont’d)
September 30, 2025
Western Asset High Income Opportunity Fund Inc.
(Percentages shown based on Fund net assets)

Security |  | Rate | Maturity Date | Face Amount† | Value
Media — continued
Getty Images Inc., Senior Secured Notes | 11.250% | 2/21/30 | 120,000 | $114,704 (a)
Gray Media Inc., Secured Notes | 9.625% | 7/15/32 | 650,000 | 664,634 (a)
iHeartCommunications Inc., Senior Secured Notes | 9.125% | 5/1/29 | 760,000 | 686,384 (a)
Univision Communications Inc., Senior Secured Notes | 9.375% | 8/1/32 | 660,000 | 703,895 (a)
Virgin Media Vendor Financing Notes III DAC, Senior Secured Notes | 4.875% | 7/15/28 | 2,000,000 GBP | 2,630,379 (a)
VZ Secured Financing BV, Senior Secured Notes | 5.000% | 1/15/32 | 680,000 | 615,681 (a)
Total Media | 30,256,633
Wireless Telecommunication Services — 3.7%
CSC Holdings LLC, Senior Notes | 11.750% | 1/31/29 | 1,550,000 | 1,304,432 (a)
CSC Holdings LLC, Senior Notes | 4.125% | 12/1/30 | 2,080,000 | 1,363,783 (a)
CSC Holdings LLC, Senior Notes | 4.625% | 12/1/30 | 1,410,000 | 495,977 (a)
CSC Holdings LLC, Senior Notes | 4.500% | 11/15/31 | 5,670,000 | 3,691,966 (a)
Sprint Capital Corp., Senior Notes | 8.750% | 3/15/32 | 5,910,000 | 7,201,891
Vmed O2 UK Financing I PLC, Senior Secured Notes | 4.750% | 7/15/31 | 500,000 | 470,936 (a)
Total Wireless Telecommunication Services | 14,528,985
Total Communication Services | 58,548,341
Consumer Discretionary — 13.9%
Automobile Components — 2.3%
Adient Global Holdings Ltd., Senior Notes | 7.500% | 2/15/33 | 490,000 | 507,755 (a)
American Axle & Manufacturing Inc., Senior Notes | 7.750% | 10/15/33 | 1,610,000 | 1,623,557 (a)(e)
Clarios Global LP/Clarios US Finance Co., Senior Secured Notes | 6.750% | 2/15/30 | 980,000 | 1,013,129 (a)
JB Poindexter & Co. Inc., Senior Notes | 8.750% | 12/15/31 | 1,870,000 | 1,960,888 (a)
ZF North America Capital Inc., Senior Notes | 6.750% | 4/23/30 | 1,220,000 | 1,191,482 (a)
ZF North America Capital Inc., Senior Notes | 7.500% | 3/24/31 | 970,000 | 964,002 (a)
ZF North America Capital Inc., Senior Notes | 6.875% | 4/23/32 | 1,710,000 | 1,638,345 (a)
Total Automobile Components | 8,899,158
Automobiles — 1.0%
Nissan Motor Co. Ltd., Senior Notes | 4.810% | 9/17/30 | 1,040,000 | 980,392 (a)
PM General Purchaser LLC, Senior Secured Notes | 9.500% | 10/1/28 | 3,320,000 | 2,880,100 (a)
Total Automobiles | 3,860,492
Diversified Consumer Services — 0.3%
Service Corp. International, Senior Notes | 7.500% | 4/1/27 | 1,095,000 | 1,137,519

See Notes to Financial Statements.

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Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

Western Asset High Income Opportunity Fund Inc.
(Percentages shown based on Fund net assets)

Security |  | Rate | Maturity Date | Face Amount† | Value
Hotels, Restaurants & Leisure — 7.5%
Carnival Corp., Senior Notes | 6.125% | 2/15/33 | 980,000 | $1,005,153 (a)
Carnival PLC, Senior Notes | 1.000% | 10/28/29 | 5,780,000 EUR | 6,155,621
Full House Resorts Inc., Senior Secured Notes | 8.250% | 2/15/28 | 3,300,000 | 3,065,729 (a)
Melco Resorts Finance Ltd., Senior Notes | 5.375% | 12/4/29 | 1,367,000 | 1,346,752 (a)
Melco Resorts Finance Ltd., Senior Notes | 6.500% | 9/24/33 | 420,000 | 421,382 (a)
NCL Corp. Ltd., Senior Notes | 7.750% | 2/15/29 | 1,871,000 | 1,993,229 (a)
NCL Finance Ltd., Senior Notes | 6.125% | 3/15/28 | 1,810,000 | 1,850,738 (a)
Pinnacle Bidco PLC, Senior Secured Notes | 10.000% | 10/11/28 | 900,000 GBP | 1,277,317 (a)
Rivers Enterprise Lender LLC/Rivers Enterprise Lender Corp., Senior Secured Notes | 6.250% | 10/15/30 | 1,450,000 | 1,463,835 (a)(e)
Viking Cruises Ltd., Senior Notes | 7.000% | 2/15/29 | 3,000,000 | 3,017,139 (a)
Viking Ocean Cruises Ship VII Ltd., Senior Secured Notes | 5.625% | 2/15/29 | 2,550,000 | 2,549,579 (a)
VOC Escrow Ltd., Senior Secured Notes | 5.000% | 2/15/28 | 140,000 | 139,722 (a)
Wynn Macau Ltd., Senior Notes | 5.625% | 8/26/28 | 1,970,000 | 1,969,318 (a)
Wynn Macau Ltd., Senior Notes | 5.125% | 12/15/29 | 1,054,000 | 1,034,923 (a)
Wynn Resorts Finance LLC/Wynn Resorts Capital Corp., Senior Notes | 7.125% | 2/15/31 | 1,730,000 | 1,863,505 (a)
Total Hotels, Restaurants & Leisure | 29,153,942
Household Durables — 0.4%
Dream Finders Homes Inc., Senior Notes | 6.875% | 9/15/30 | 1,080,000 | 1,087,441 (a)
Newell Brands Inc., Senior Notes | 8.500% | 6/1/28 | 530,000 | 561,925 (a)
Total Household Durables | 1,649,366
Specialty Retail — 2.1%
Global Auto Holdings Ltd./AAG FH UK Ltd., Senior Notes | 11.500% | 8/15/29 | 2,000,000 | 2,111,720 (a)
Global Auto Holdings Ltd./AAG FH UK Ltd., Senior Notes | 8.750% | 1/15/32 | 780,000 | 759,151 (a)
Michaels Cos. Inc., Senior Notes | 7.875% | 5/1/29 | 720,000 | 604,800 (a)
Michaels Cos. Inc., Senior Secured Notes | 5.250% | 5/1/28 | 1,770,000 | 1,637,974 (a)
Sally Holdings LLC/Sally Capital Inc., Senior Notes | 6.750% | 3/1/32 | 1,700,000 | 1,769,589
Upbound Group Inc., Senior Notes | 6.375% | 2/15/29 | 1,380,000 | 1,363,873 (a)
Total Specialty Retail | 8,247,107
Textiles, Apparel & Luxury Goods — 0.3%
Saks Global Enterprises LLC, Second Out Senior Secured Notes | 11.000% | 12/15/29 | 1,648,000 | 856,960 (a)

See Notes to Financial Statements.
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

11

Schedule of investments (cont’d)
September 30, 2025
Western Asset High Income Opportunity Fund Inc.
(Percentages shown based on Fund net assets)

Security |  | Rate | Maturity Date | Face Amount† | Value
Textiles, Apparel & Luxury Goods — continued
Saks Global Enterprises LLC, Third Out Senior Secured Notes | 11.000% | 12/15/29 | 61,800 | $22,557 (a)
Total Textiles, Apparel & Luxury Goods | 879,517
Total Consumer Discretionary | 53,827,101
Energy — 16.7%
Energy Equipment & Services — 1.1%
Nabors Industries Inc., Senior Notes | 8.875% | 8/15/31 | 880,000 | 820,222 (a)
Noble Finance II LLC, Senior Notes | 8.000% | 4/15/30 | 850,000 | 880,433 (a)
Shelf Drilling Holdings Ltd., Senior Secured Notes | 9.625% | 4/15/29 | 1,510,000 | 1,584,985 (a)
WBI Operating LLC, Senior Notes | 6.500% | 10/15/33 | 1,010,000 | 1,010,000 (a)(e)
Total Energy Equipment & Services | 4,295,640
Oil, Gas & Consumable Fuels — 15.6%
Blue Racer Midstream LLC/Blue Racer Finance Corp., Senior Notes | 7.250% | 7/15/32 | 500,000 | 526,207 (a)
Chord Energy Corp., Senior Notes | 6.000% | 10/1/30 | 750,000 | 745,247 (a)
Chord Energy Corp., Senior Notes | 6.750% | 3/15/33 | 1,840,000 | 1,865,417 (a)
Crescent Energy Finance LLC, Senior Notes | 7.375% | 1/15/33 | 2,530,000 | 2,465,395 (a)
Crescent Energy Finance LLC, Senior Notes | 8.375% | 1/15/34 | 1,430,000 | 1,450,117 (a)
Ecopetrol SA, Senior Notes | 5.875% | 5/28/45 | 4,110,000 | 3,146,464
Energy Transfer LP, Junior Subordinated Notes (6.625% to 2/15/28 then 3 mo. USD LIBOR + 4.155%) | 6.625% | 2/15/28 | 1,910,000 | 1,908,976 (f)(g)
Howard Midstream Energy Partners LLC, Senior Notes | 6.625% | 1/15/34 | 880,000 | 897,776 (a)
Kinder Morgan Inc., Senior Notes | 7.750% | 1/15/32 | 6,920,000 | 8,051,098
New Generation Gas Gathering LLC, Senior Secured Notes (3 mo. Term SOFR + 5.750%) | 10.051% | 9/30/29 | 889,189 | 875,851 (a)(g)(h)(i)
NGPL PipeCo LLC, Senior Notes | 7.768% | 12/15/37 | 1,520,000 | 1,759,358 (a)
Northern Oil & Gas Inc., Senior Notes | 7.875% | 10/15/33 | 1,200,000 | 1,196,002 (a)(e)
Occidental Petroleum Corp., Senior Notes | 6.200% | 3/15/40 | 1,070,000 | 1,088,277
Permian Resources Operating LLC, Senior Notes | 6.250% | 2/1/33 | 1,940,000 | 1,977,578 (a)
Petrobras Global Finance BV, Senior Notes | 6.750% | 1/27/41 | 4,370,000 | 4,428,811
Petroleos del Peru SA, Senior Notes | 4.750% | 6/19/32 | 1,500,000 | 1,305,652 (a)
Petroleos Mexicanos, Senior Notes | 6.500% | 6/2/41 | 1,000,000 | 876,542
Range Resources Corp., Senior Notes | 8.250% | 1/15/29 | 620,000 | 635,017
Rockies Express Pipeline LLC, Senior Notes | 6.750% | 3/15/33 | 320,000 | 334,421 (a)
Rockies Express Pipeline LLC, Senior Notes | 6.875% | 4/15/40 | 1,140,000 | 1,174,096 (a)

See Notes to Financial Statements.

12
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

Western Asset High Income Opportunity Fund Inc.
(Percentages shown based on Fund net assets)

Security |  | Rate | Maturity Date | Face Amount† | Value
Oil, Gas & Consumable Fuels — continued
Summit Midstream Holdings LLC, Senior Secured Notes | 8.625% | 10/31/29 | 410,000 | $412,342 (a)
Sunoco LP, Junior Subordinated Notes (7.875% to 9/18/30 then 5 year Treasury Constant Maturity Rate + 4.230%) | 7.875% | 9/18/30 | 1,971,000 | 2,003,236 (a)(f)(g)
Sunoco LP, Senior Notes | 5.625% | 3/15/31 | 970,000 | 963,451 (a)
Venture Global LNG Inc., Junior Subordinated Notes (9.000% to 9/30/29 then 5 year Treasury Constant Maturity Rate + 5.440%) | 9.000% | 9/30/29 | 2,610,000 | 2,588,545 (a)(f)(g)
Venture Global LNG Inc., Senior Secured Notes | 7.000% | 1/15/30 | 390,000 | 403,841 (a)
Venture Global LNG Inc., Senior Secured Notes | 9.875% | 2/1/32 | 3,260,000 | 3,551,275 (a)
Venture Global Plaquemines LNG LLC, Senior Secured Notes | 7.750% | 5/1/35 | 640,000 | 722,773 (a)
Venture Global Plaquemines LNG LLC, Senior Secured Notes | 6.750% | 1/15/36 | 410,000 | 435,749 (a)
Vermilion Energy Inc., Senior Notes | 6.875% | 5/1/30 | 730,000 | 713,133 (a)
Vermilion Energy Inc., Senior Notes | 7.250% | 2/15/33 | 680,000 | 643,216 (a)
Western Midstream Operating LP, Senior Notes | 4.050% | 2/1/30 | 340,000 | 331,987
Western Midstream Operating LP, Senior Notes | 5.300% | 3/1/48 | 1,070,000 | 931,883
Western Midstream Operating LP, Senior Notes | 5.250% | 2/1/50 | 6,410,000 | 5,583,749
Williams Cos. Inc., Senior Notes | 7.500% | 1/15/31 | 620,000 | 702,947
Williams Cos. Inc., Senior Notes | 5.750% | 6/24/44 | 3,190,000 | 3,230,076
YPF SA, Senior Notes | 6.950% | 7/21/27 | 530,000 | 527,070 (a)
Total Oil, Gas & Consumable Fuels | 60,453,575
Total Energy | 64,749,215
Financials — 7.9%
Banks — 2.1%
BNP Paribas SA, Junior Subordinated Notes (7.750% to 8/16/29 then 5 year Treasury Constant Maturity Rate + 4.899%) | 7.750% | 8/16/29 | 1,470,000 | 1,560,775 (a)(f)(g)
HSBC Holdings PLC, Subordinated Notes (8.113% to 11/3/32 then SOFR + 4.250%) | 8.113% | 11/3/33 | 1,440,000 | 1,689,339 (g)
Intesa Sanpaolo SpA, Subordinated Notes | 5.710% | 1/15/26 | 2,800,000 | 2,806,302 (a)

See Notes to Financial Statements.
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

13

Schedule of investments (cont’d)
September 30, 2025
Western Asset High Income Opportunity Fund Inc.
(Percentages shown based on Fund net assets)

Security |  | Rate | Maturity Date | Face Amount† | Value
Banks — continued
Lloyds Banking Group PLC, Junior Subordinated Notes (8.000% to 3/27/30 then 5 year Treasury Constant Maturity Rate + 3.913%) | 8.000% | 9/27/29 | 1,840,000 | $1,992,648 (f)(g)
Total Banks | 8,049,064
Capital Markets — 1.1%
B3 SA - Brasil Bolsa Balcao, Senior Notes | 4.125% | 9/20/31 | 1,000,000 | 939,435 (c)
Credit Suisse AG AT1 Claim | — | — | 10,560,000 | 0 *(h)(i)(j)
StoneX Escrow Issuer LLC, Secured Notes | 6.875% | 7/15/32 | 660,000 | 679,877 (a)
StoneX Group Inc., Secured Notes | 7.875% | 3/1/31 | 640,000 | 673,554 (a)
UBS Group AG, Junior Subordinated Notes (9.250% to 11/13/28 then 5 year Treasury Constant Maturity Rate + 4.745%) | 9.250% | 11/13/28 | 2,010,000 | 2,222,445 (a)(f)(g)
Total Capital Markets | 4,515,311
Financial Services — 3.0%
Boost Newco Borrower LLC/GTCR W Dutch Finance Sub BV, Senior Secured Notes | 8.500% | 1/15/31 | 1,160,000 GBP | 1,681,992 (a)
Burford Capital Global Finance LLC, Senior Notes | 9.250% | 7/1/31 | 2,000,000 | 2,127,632 (a)
Capstone Borrower Inc., Senior Secured Notes | 8.000% | 6/15/30 | 410,000 | 429,266 (a)
Jane Street Group/JSG Finance Inc., Senior Secured Notes | 7.125% | 4/30/31 | 2,640,000 | 2,771,148 (a)
Rocket Cos. Inc., Senior Notes | 6.125% | 8/1/30 | 1,030,000 | 1,057,867 (a)
SGUS LLC, Senior Secured Notes | 11.000% | 12/15/29 | 706,018 | 672,606 (a)
VFH Parent LLC/Valor Co-Issuer Inc., Senior Secured Notes | 7.500% | 6/15/31 | 780,000 | 807,233 (a)
VistaJet Malta Finance PLC/Vista Management Holding Inc., Senior Notes | 7.875% | 5/1/27 | 770,000 | 782,684 (a)
VistaJet Malta Finance PLC/Vista Management Holding Inc., Senior Notes | 9.500% | 6/1/28 | 380,000 | 395,948 (a)
VistaJet Malta Finance PLC/Vista Management Holding Inc., Senior Notes | 6.375% | 2/1/30 | 880,000 | 858,470 (a)
Total Financial Services | 11,584,846
Insurance — 0.7%
Acrisure LLC/Acrisure Finance Inc., Senior Secured Notes | 6.750% | 7/1/32 | 370,000 | 381,286 (a)
APH Somerset Investor 2 LLC/APH2 Somerset Investor 2 LLC/APH3 Somerset Investor 2 LLC, Senior Notes | 7.875% | 11/1/29 | 1,150,000 | 1,201,118 (a)

See Notes to Financial Statements.

14
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

Western Asset High Income Opportunity Fund Inc.
(Percentages shown based on Fund net assets)

Security |  | Rate | Maturity Date | Face Amount† | Value
Insurance — continued
MetLife Capital Trust IV, Junior Subordinated Notes | 7.875% | 12/15/37 | 1,010,000 | $1,131,332 (a)
Total Insurance | 2,713,736
Mortgage Real Estate Investment Trusts (REITs) — 1.0%
Apollo Commercial Real Estate Finance Inc., Senior Secured Notes | 4.625% | 6/15/29 | 750,000 | 721,359 (a)
Arbor Realty SR Inc., Senior Notes | 7.875% | 7/15/30 | 1,330,000 | 1,398,990 (a)
Starwood Property Trust Inc., Senior Notes | 7.250% | 4/1/29 | 780,000 | 820,010 (a)
Starwood Property Trust Inc., Senior Notes | 6.000% | 4/15/30 | 1,060,000 | 1,076,970 (a)
Total Mortgage Real Estate Investment Trusts (REITs) | 4,017,329
Total Financials | 30,880,286
Health Care — 7.2%
Health Care Providers & Services — 4.6%
CHS/Community Health Systems Inc., Secured Notes | 6.875% | 4/15/29 | 1,790,000 | 1,424,697 (a)
CHS/Community Health Systems Inc., Senior Secured Notes | 6.000% | 1/15/29 | 250,000 | 242,893 (a)
CHS/Community Health Systems Inc., Senior Secured Notes | 4.750% | 2/15/31 | 2,440,000 | 2,111,718 (a)
CHS/Community Health Systems Inc., Senior Secured Notes | 10.875% | 1/15/32 | 2,540,000 | 2,693,281 (a)
CHS/Community Health Systems Inc., Senior Secured Notes | 9.750% | 1/15/34 | 1,460,000 | 1,497,595 (a)
HCA Inc., Senior Notes | 7.500% | 11/15/95 | 6,265,000 | 6,980,577
LifePoint Health Inc., Senior Secured Notes | 9.875% | 8/15/30 | 1,720,000 | 1,864,803 (a)
Sotera Health Holdings LLC, Senior Secured Notes | 7.375% | 6/1/31 | 990,000 | 1,040,755 (a)
Total Health Care Providers & Services | 17,856,319
Pharmaceuticals — 2.6%
1261229 BC Ltd., Senior Secured Notes | 10.000% | 4/15/32 | 1,990,000 | 2,041,426 (a)
Bausch Health Americas Inc., Senior Notes | 8.500% | 1/31/27 | 10,000 | 9,909 (a)
Bausch Health Cos. Inc., Senior Notes | 6.250% | 2/15/29 | 210,000 | 164,162 (a)
Bausch Health Cos. Inc., Senior Secured Notes | 4.875% | 6/1/28 | 2,770,000 | 2,481,574 (a)
Par Pharmaceutical Inc., Escrow | — | — | 70,000 | 0 *(h)(i)(j)
Teva Pharmaceutical Finance Netherlands III BV, Senior Notes | 5.125% | 5/9/29 | 880,000 | 885,467
Teva Pharmaceutical Finance Netherlands III BV, Senior Notes | 8.125% | 9/15/31 | 1,150,000 | 1,316,311

See Notes to Financial Statements.
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

15

Schedule of investments (cont’d)
September 30, 2025
Western Asset High Income Opportunity Fund Inc.
(Percentages shown based on Fund net assets)

Security |  | Rate | Maturity Date | Face Amount† | Value
Pharmaceuticals — continued
Teva Pharmaceutical Finance Netherlands III BV, Senior Notes | 6.000% | 12/1/32 | 1,420,000 | $1,479,940
Teva Pharmaceutical Finance Netherlands III BV, Senior Notes | 4.100% | 10/1/46 | 2,550,000 | 1,905,309
Total Pharmaceuticals | 10,284,098
Total Health Care | 28,140,417
Industrials — 10.4%
Aerospace & Defense — 1.6%
Axon Enterprise Inc., Senior Notes | 6.125% | 3/15/30 | 380,000 | 391,220 (a)
Axon Enterprise Inc., Senior Notes | 6.250% | 3/15/33 | 190,000 | 196,041 (a)
Bombardier Inc., Senior Notes | 7.500% | 2/1/29 | 2,990,000 | 3,120,496 (a)
Bombardier Inc., Senior Notes | 7.250% | 7/1/31 | 500,000 | 530,641 (a)
Bombardier Inc., Senior Notes | 7.000% | 6/1/32 | 80,000 | 83,715 (a)
TransDigm Inc., Senior Secured Notes | 7.125% | 12/1/31 | 875,000 | 913,797 (a)
TransDigm Inc., Senior Secured Notes | 6.625% | 3/1/32 | 1,020,000 | 1,051,411 (a)
Total Aerospace & Defense | 6,287,321
Building Products — 0.6%
Masterbrand Inc., Senior Notes | 7.000% | 7/15/32 | 500,000 | 517,380 (a)
Quikrete Holdings Inc., Senior Secured Notes | 6.375% | 3/1/32 | 1,700,000 | 1,762,261 (a)
Total Building Products | 2,279,641
Commercial Services & Supplies — 3.4%
CoreCivic Inc., Senior Notes | 4.750% | 10/15/27 | 280,000 | 276,661
CoreCivic Inc., Senior Notes | 8.250% | 4/15/29 | 3,330,000 | 3,520,549
GEO Group Inc., Senior Notes | 10.250% | 4/15/31 | 3,160,000 | 3,478,980
GEO Group Inc., Senior Secured Notes | 8.625% | 4/15/29 | 1,210,000 | 1,281,820
GFL Environmental Inc., Senior Notes | 6.750% | 1/15/31 | 950,000 | 995,287 (a)
RB Global Holdings Inc., Senior Notes | 7.750% | 3/15/31 | 1,250,000 | 1,308,941 (a)
RR Donnelley & Sons Co., Secured Notes | 10.875% | 8/1/29 | 630,000 | 628,927 (a)
RR Donnelley & Sons Co., Senior Secured Notes | 9.500% | 8/1/29 | 1,840,000 | 1,887,454 (a)
Total Commercial Services & Supplies | 13,378,619
Construction & Engineering — 0.8%
Arcosa Inc., Senior Notes | 6.875% | 8/15/32 | 620,000 | 648,097 (a)
Tutor Perini Corp., Senior Notes | 11.875% | 4/30/29 | 2,070,000 | 2,320,225 (a)
Total Construction & Engineering | 2,968,322
Ground Transportation — 0.8%
Carriage Purchaser Inc., Senior Notes | 7.875% | 10/15/29 | 2,020,000 | 1,889,827 (a)
XPO Inc., Senior Notes | 7.125% | 2/1/32 | 1,000,000 | 1,052,598 (a)
Total Ground Transportation | 2,942,425

See Notes to Financial Statements.

16
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

Western Asset High Income Opportunity Fund Inc.
(Percentages shown based on Fund net assets)

Security |  | Rate | Maturity Date | Face Amount† | Value
Machinery — 0.6%
Park-Ohio Industries Inc., Senior Secured Notes | 8.500% | 8/1/30 | 1,090,000 | $1,130,951 (a)
Titan International Inc., Senior Secured Notes | 7.000% | 4/30/28 | 1,420,000 | 1,422,893
Total Machinery | 2,553,844
Passenger Airlines — 2.0%
American Airlines Inc., Senior Secured Notes | 7.250% | 2/15/28 | 3,670,000 | 3,762,814 (a)
American Airlines Inc., Senior Secured Notes | 8.500% | 5/15/29 | 1,980,000 | 2,066,680 (a)
JetBlue Airways Corp./JetBlue Loyalty LP, Senior Secured Notes | 9.875% | 9/20/31 | 1,180,000 | 1,197,850 (a)
Spirit Loyalty Cayman Ltd./Spirit IP Cayman Ltd., Senior Secured Notes | 11.000% | 3/12/30 | 1,539,044 | 655,048 *(a)(b)
Total Passenger Airlines | 7,682,392
Trading Companies & Distributors — 0.6%
Herc Holdings Inc., Senior Notes | 7.000% | 6/15/30 | 560,000 | 582,143 (a)
Herc Holdings Inc., Senior Notes | 7.250% | 6/15/33 | 710,000 | 741,735 (a)
United Rentals North America Inc., Senior Notes | 5.500% | 5/15/27 | 116,000 | 116,101
United Rentals North America Inc., Senior Notes | 6.125% | 3/15/34 | 1,000,000 | 1,041,073 (a)
Total Trading Companies & Distributors | 2,481,052
Total Industrials | 40,573,616
Information Technology — 4.0%
Communications Equipment — 1.6%
CommScope LLC, Senior Notes | 7.125% | 7/1/28 | 190,000 | 190,860 (a)
CommScope LLC, Senior Secured Notes | 9.500% | 12/15/31 | 1,110,000 | 1,149,656 (a)
Connect Finco SARL/Connect US Finco LLC, Senior Secured Notes | 9.000% | 9/15/29 | 3,490,000 | 3,673,765 (a)
Viasat Inc., Senior Notes | 7.500% | 5/30/31 | 1,400,000 | 1,315,510 (a)
Total Communications Equipment | 6,329,791
Electronic Equipment, Instruments & Components — 0.5%
EquipmentShare.com Inc., Senior Secured Notes | 8.000% | 3/15/33 | 1,760,000 | 1,882,579 (a)
IT Services — 0.6%
CoreWeave Inc., Senior Notes | 9.250% | 6/1/30 | 480,000 | 496,322 (a)
CoreWeave Inc., Senior Notes | 9.000% | 2/1/31 | 880,000 | 902,993 (a)
Shift4 Payments LLC/Shift4 Payments Finance Sub Inc., Senior Notes | 6.750% | 8/15/32 | 800,000 | 827,685 (a)
Total IT Services | 2,227,000
Semiconductors & Semiconductor Equipment — 0.3%
Qnity Electronics Inc., Senior Notes | 6.250% | 8/15/33 | 1,120,000 | 1,145,128 (a)

See Notes to Financial Statements.
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

17

Schedule of investments (cont’d)
September 30, 2025
Western Asset High Income Opportunity Fund Inc.
(Percentages shown based on Fund net assets)

Security |  | Rate | Maturity Date | Face Amount† | Value
Software — 0.8%
Cloud Software Group Inc., Senior Secured Notes | 8.250% | 6/30/32 | 1,870,000 | $1,985,675 (a)
Cloud Software Group Inc., Senior Secured Notes | 6.625% | 8/15/33 | 680,000 | 692,913 (a)
Gen Digital Inc., Senior Notes | 6.250% | 4/1/33 | 560,000 | 573,092 (a)
Total Software | 3,251,680
Technology Hardware, Storage & Peripherals — 0.2%
Diebold Nixdorf Inc., Senior Secured Notes | 7.750% | 3/31/30 | 610,000 | 644,992 (a)
Total Information Technology | 15,481,170
Materials — 3.1%
Chemicals — 0.4%
Cerdia Finanz GmbH, Senior Secured Notes | 9.375% | 10/3/31 | 1,320,000 | 1,400,850 (a)
Containers & Packaging — 0.6%
ARD Finance SA, Senior Secured Notes (6.500% Cash or 7.250% PIK) | 6.500% | 6/30/27 | 1,374,482 | 41,235 (a)(d)
Ardagh Metal Packaging Finance USA LLC/ Ardagh Metal Packaging Finance PLC, Senior Notes | 4.000% | 9/1/29 | 1,170,000 | 1,083,796 (a)
Ardagh Packaging Finance PLC/Ardagh Holdings USA Inc., Euronext Dublin, Senior Notes | 5.250% | 8/15/27 | 1,578,000 | 608,540 (a)
Ardagh Packaging Finance PLC/Ardagh Holdings USA Inc., Senior Notes | 5.250% | 8/15/27 | 1,510,000 | 582,316 (a)
Total Containers & Packaging | 2,315,887
Metals & Mining — 2.1%
Capstone Copper Corp., Senior Notes | 6.750% | 3/31/33 | 650,000 | 670,078 (a)
First Quantum Minerals Ltd., Secured Notes | 9.375% | 3/1/29 | 920,000 | 976,189 (a)
First Quantum Minerals Ltd., Senior Notes | 8.625% | 6/1/31 | 2,120,000 | 2,230,268 (a)
First Quantum Minerals Ltd., Senior Notes | 8.000% | 3/1/33 | 3,410,000 | 3,604,734 (a)
First Quantum Minerals Ltd., Senior Notes | 7.250% | 2/15/34 | 790,000 | 817,348 (a)
Total Metals & Mining | 8,298,617
Total Materials | 12,015,354
Real Estate — 2.3%
Diversified REITs — 0.4%
MPT Operating Partnership LP/MPT Finance Corp., Senior Notes | 5.000% | 10/15/27 | 1,020,000 | 989,102
MPT Operating Partnership LP/MPT Finance Corp., Senior Secured Notes | 8.500% | 2/15/32 | 460,000 | 489,130 (a)
Total Diversified REITs | 1,478,232

See Notes to Financial Statements.

18
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

Western Asset High Income Opportunity Fund Inc.
(Percentages shown based on Fund net assets)

Security |  | Rate | Maturity Date | Face Amount† | Value
Health Care REITs — 0.3%
Diversified Healthcare Trust, Senior Notes | 4.375% | 3/1/31 | 240,000 | $212,223
Diversified Healthcare Trust, Senior Secured Notes | 7.250% | 10/15/30 | 800,000 | 814,064 (a)
Total Health Care REITs | 1,026,287
Hotel & Resort REITs — 0.5%
Service Properties Trust, Senior Notes | 8.875% | 6/15/32 | 2,030,000 | 2,043,183
Real Estate Management & Development — 0.4%
Add Hero Holdings Ltd., Senior Secured Notes (7.500% Cash or 8.500% PIK) | 8.500% | 9/30/29 | 306,082 | 18,365 (c)(d)
Add Hero Holdings Ltd., Senior Secured Notes (8.000% Cash or 9.000% PIK) | 9.000% | 9/30/30 | 248,681 | 4,974 (c)(d)
Add Hero Holdings Ltd., Senior Secured Notes (8.800% Cash or 9.800% PIK) | 9.800% | 9/30/31 | 327,014 | 6,540 (c)(d)
China Aoyuan Group Ltd., Senior Notes, Step bond (0.000% to 9/30/31 then 1.000%) | 0.000% | 3/30/2173 | 450,290 | 3,377 (c)(f)
China Aoyuan Group Ltd., Senior Secured Notes (5.500% PIK) | 5.500% | 9/30/31 | 122,116 | 2,137 (c)(d)
Country Garden Holdings Co. Ltd., Senior Secured Notes | — | 1/27/24 | 2,016,000 | 171,360 *(c)(k)
Cushman & Wakefield US Borrower LLC, Senior Secured Notes | 8.875% | 9/1/31 | 420,000 | 448,607 (a)
Five Point Operating Co. LP, Senior Notes | 8.000% | 10/1/30 | 1,050,000 | 1,066,166 (a)
Total Real Estate Management & Development | 1,721,526
Specialized REITs — 0.7%
Iron Mountain Inc., Senior Notes | 7.000% | 2/15/29 | 540,000 | 556,900 (a)
Millrose Properties Inc., Senior Notes | 6.375% | 8/1/30 | 1,520,000 | 1,546,995 (a)
Millrose Properties Inc., Senior Notes | 6.250% | 9/15/32 | 440,000 | 441,425 (a)
Total Specialized REITs | 2,545,320
Total Real Estate | 8,814,548
Utilities — 1.7%
Electric Utilities — 1.4%
Alpha Generation LLC, Senior Notes | 6.750% | 10/15/32 | 940,000 | 971,020 (a)
NRG Energy Inc., Senior Notes | 6.000% | 1/15/36 | 2,090,000 | 2,091,606 (a)(e)
Vistra Operations Co. LLC, Senior Notes | 7.750% | 10/15/31 | 920,000 | 974,204 (a)
Vistra Operations Co. LLC, Senior Notes | 6.875% | 4/15/32 | 1,410,000 | 1,475,716 (a)
Total Electric Utilities | 5,512,546
Independent Power and Renewable Electricity Producers — 0.3%
Lightning Power LLC, Senior Secured Notes | 7.250% | 8/15/32 | 940,000 | 995,875 (a)
Total Utilities | 6,508,421
Total Corporate Bonds & Notes (Cost — $300,871,594) | 319,538,469

See Notes to Financial Statements.
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

19

Schedule of investments (cont’d)
September 30, 2025
Western Asset High Income Opportunity Fund Inc.
(Percentages shown based on Fund net assets)

Security |  | Rate | Maturity Date | Face Amount† | Value
Senior Loans — 8.3%
Communication Services — 1.1%
Interactive Media & Services — 0.4%
X Corp., Term Loan B1 (3 mo. Term SOFR + 6.650%) | 10.958% | 10/26/29 | 228,823 | $224,787 (g)(l)(m)
X Corp., Term Loan B3 | 9.500% | 10/26/29 | 1,310,000 | 1,315,915 (l)(m)
Total Interactive Media & Services | 1,540,702
Media — 0.7%
Diamond Sports Net LLC, First Lien Exit Term Loan (15.000% PIK) | 15.000% | 1/2/28 | 1,675,829 | 1,445,402 (d)(l)(m)
iHeartCommunications Inc., Refinanced Term Loan B (1 mo. Term SOFR + 5.889%) | 10.129% | 5/1/29 | 1,357,740 | 1,189,720 (g)(l)(m)
Total Media | 2,635,122
Total Communication Services | 4,175,824
Consumer Discretionary — 2.7%
Automobile Components — 0.6%
ABC Technologies Inc., Term Loan B | — | 1/2/40 | 1,290,000 | 1,241,625 (h)(n)
Clarios Global LP, 2024 Term Loan B (1 mo. Term SOFR + 2.500%) | 6.663% | 5/6/30 | 992,500 | 994,207 (g)(l)(m)
First Brands Group LLC, 2022 Incremental Term Loan (3 mo. Term SOFR + 5.262%) | 9.570% | 3/30/27 | 740,700 | 269,893 (g)(l)(m)
Total Automobile Components | 2,505,725
Diversified Consumer Services — 0.5%
Prime Security Services Borrower LLC, Term Loan B1 (6 mo. Term SOFR + 2.000%) | 6.129% | 10/13/30 | 990,019 | 988,712 (g)(l)(m)
WW International Inc., Take-Back Term Loan (3 mo. Term SOFR + 6.800%) | 10.803% | 6/25/30 | 1,248,802 | 1,142,654 (g)(l)(m)
Total Diversified Consumer Services | 2,131,366
Hotels, Restaurants & Leisure — 1.3%
1011778 BC Unlimited Liability Co., Term Loan B6 (1 mo. Term SOFR + 1.750%) | 5.913% | 9/20/30 | 987,500 | 985,441 (g)(l)(m)
Caesars Entertainment Inc., Incremental Term Loan B1 (1 mo. Term SOFR + 2.250%) | 6.413% | 2/6/31 | 2,003,168 | 2,001,085 (g)(l)(m)
Fertitta Entertainment LLC, Initial Term Loan B (1 mo. Term SOFR + 3.250%) | 7.413% | 1/27/29 | 1,227,736 | 1,227,355 (g)(l)(m)
Station Casinos LLC, Term Loan Facility B (1 mo. Term SOFR + 2.000%) | 6.163% | 3/14/31 | 738,750 | 739,555 (g)(l)(m)
Total Hotels, Restaurants & Leisure | 4,953,436

See Notes to Financial Statements.

20
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

Western Asset High Income Opportunity Fund Inc.
(Percentages shown based on Fund net assets)

Security |  | Rate | Maturity Date | Face Amount† | Value
Specialty Retail — 0.3%
Petco Health and Wellness Co. Inc., First Lien Initial Term Loan (3 mo. Term SOFR + 3.512%) | 7.513% | 3/3/28 | 1,020,000 | $995,826 (g)(l)(m)(n)
Total Consumer Discretionary | 10,586,353
Consumer Staples — 0.3%
Beverages — 0.3%
Triton Water Holdings Inc., 2025 Refinancing Term Loan (3 mo. Term SOFR + 2.250%) | 6.252% | 3/31/28 | 1,227,902 | 1,229,081 (g)(l)(m)
Financials — 0.8%
Banks — 0.2%
Ascensus Group Holdings Inc., 2024 Term Loan B (1 mo. Term SOFR + 3.000%) | 7.163% | 8/2/28 | 589,010 | 589,255 (g)(l)(m)
Consumer Finance — 0.1%
Blackhawk Network Holdings Inc., Term Loan B (1 mo. Term SOFR + 4.000%) | 8.163% | 3/12/29 | 464,143 | 466,500 (g)(l)(m)
Financial Services — 0.5%
Boost Newco Borrower LLC, Term Loan B2 (3 mo. Term SOFR + 2.000%) | 6.002% | 1/31/31 | 992,512 | 995,098 (g)(l)(m)
Nexus Buyer LLC, Amendment No. 10 Term Loan (1 mo. Term SOFR + 4.000%) | 8.163% | 7/31/31 | 250,000 | 250,314 (g)(l)(m)
Nexus Buyer LLC, Amendment No. 9 Refinancing Term Loan (1 mo. Term SOFR + 3.500%) | 7.663% | 7/31/31 | 693,022 | 692,173 (g)(l)(m)
Total Financial Services | 1,937,585
Total Financials | 2,993,340
Health Care — 1.2%
Health Care Equipment & Supplies — 0.6%
Medline Borrower LP, 2028 Refinancing Term Loan (1 mo. Term SOFR + 2.000%) | 6.163% | 10/23/28 | 2,091,893 | 2,093,974 (g)(l)(m)
Health Care Providers & Services — 0.6%
LifePoint Health Inc., Term Loan B (3 mo. Term SOFR + 3.750%) | 8.068% | 5/16/31 | 2,475,047 | 2,473,636 (g)(l)(m)
Total Health Care | 4,567,610
Industrials — 1.2%
Aerospace & Defense — 0.2%
TransDigm Inc., Term Loan J (3 mo. Term SOFR + 2.500%) | 6.502% | 2/28/31 | 985,031 | 985,657 (g)(l)(m)
Building Products — 0.3%
ACProducts Holdings Inc., Initial Term Loan (3 mo. Term SOFR + 4.512%) | 8.513% | 5/17/28 | 392,821 | 330,103 (g)(l)(m)

See Notes to Financial Statements.
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

21

Schedule of investments (cont’d)
September 30, 2025
Western Asset High Income Opportunity Fund Inc.
(Percentages shown based on Fund net assets)

Security |  | Rate | Maturity Date | Face Amount† | Value
Building Products — continued
Quikrete Holdings Inc., Term Loan B3 (1 mo. Term SOFR + 2.250%) | 6.413% | 2/10/32 | 895,500 | $895,956 (g)(l)(m)
Total Building Products | 1,226,059
Machinery — 0.3%
TK Elevator Midco Gmbh, USD Term Loan B (3 mo. Term SOFR + 3.000%) | 7.197% | 4/30/30 | 982,631 | 986,183 (g)(l)(m)
Passenger Airlines — 0.4%
United Airlines Inc., Term Loan B (3 mo. Term SOFR + 2.000%) | 6.196% | 2/22/31 | 1,388,701 | 1,394,777 (g)(l)(m)
Total Industrials | 4,592,676
Information Technology — 1.0%
Software — 1.0%
Modena Buyer LLC, Initial Term Loan (3 mo. Term SOFR + 4.500%) | 8.808% | 7/1/31 | 794,000 | 785,211 (g)(l)(m)
Red Planet Borrower LLC, Initial Term Loan (1 mo. Term SOFR + 4.000%) | 8.163% | 9/8/32 | 900,000 | 877,500 (g)(l)(m)
X.Ai Corp., Initial Term Loan | 12.500% | 6/30/28 | 2,244,375 | 2,332,141 (l)(m)
Total Software | 3,994,852
Technology Hardware, Storage & Peripherals — 0.0%††
Vericast Corp., 2024 Extended Term Loan (3 mo. Term SOFR + 7.750%) | 11.622% | 6/16/26 | 32,308 | 31,446 (g)(l)(m)
Total Information Technology | 4,026,298
Total Senior Loans (Cost — $32,658,857) | 32,171,182
Asset-Backed Securities — 7.0%
720 East CLO Ltd., 2025-7A E (3 mo. Term SOFR + 4.750%) | 9.031% | 4/20/37 | 390,000 | 390,672 (a)(g)
AGL CLO Ltd., 2022-17A ER (3 mo. Term SOFR + 4.650%) | 8.975% | 1/21/35 | 1,240,000 | 1,192,717 (a)(g)
AGL CLO Ltd., 2025-44A E (3 mo. Term SOFR + 4.750%) | 8.703% | 10/22/37 | 745,000 | 747,606 (a)(g)
AMMC CLO Ltd., 2021-24A DR (3 mo. Term SOFR + 2.950%) | 7.275% | 1/20/35 | 480,000 | 482,990 (a)(g)
Apex Credit CLO LLC, 2021-2A CR (3 mo. Term SOFR + 3.750%) | 7.982% | 10/20/34 | 500,000 | 505,729 (a)(g)
Apex Credit CLO Ltd., 2019-2A ERR (3 mo. Term SOFR + 7.670%) | 11.988% | 1/25/38 | 820,000 | 823,884 (a)(g)
Apidos Loan Fund Ltd., 2024-1A D1R (3 mo. Term SOFR + 2.700%) | 6.827% | 10/25/38 | 610,000 | 609,966 (a)(g)
Balboa Bay Loan Funding Ltd., 2023-1A ERR (3 mo. Term SOFR + 5.400%) | 9.725% | 4/20/36 | 980,000 | 982,511 (a)(g)

See Notes to Financial Statements.

22
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

Western Asset High Income Opportunity Fund Inc.
(Percentages shown based on Fund net assets)

Security |  | Rate | Maturity Date | Face Amount† | Value
Asset-Backed Securities — continued
Bear Mountain Park CLO Ltd., 2022-1A ER (3 mo. Term SOFR + 5.950%) | 10.268% | 7/15/37 | 770,000 | $777,731 (a)(g)
Black Diamond CLO Ltd., 2021-1A CR (3 mo. Term SOFR + 3.900%) | 8.219% | 11/22/34 | 770,000 | 771,846 (a)(g)
CarVal CLO Ltd., 2024-3A E (3 mo. Term SOFR + 6.350%) | 10.675% | 10/20/37 | 1,020,000 | 1,046,041 (a)(g)
CIFC Funding Ltd., 2022-2A ER (3 mo. Term SOFR + 4.750%) | 9.075% | 4/19/35 | 300,000 | 299,257 (a)(g)
Clover CLO LLC, 2021-3A DR (3 mo. Term SOFR + 2.550%) | 6.868% | 1/25/35 | 480,000 | 481,191 (a)(g)
Fort Greene Park CLO LLC, 2025-2A ER (3 mo. Term SOFR + 4.400%) | 8.732% | 4/22/34 | 1,080,000 | 1,069,448 (a)(g)
Galaxy CLO Ltd., 2018-25A D1RR (3 mo. Term SOFR + 2.700%) | 6.960% | 4/25/36 | 510,000 | 510,601 (a)(g)
GoldenTree Loan Management US CLO Ltd., 2017-1A ER3 (3 mo. Term SOFR + 4.500%) | 8.825% | 4/20/34 | 470,000 | 468,006 (a)(g)
GoldenTree Loan Management US CLO Ltd., 2019-6A ER2 (3 mo. Term SOFR + 4.500%) | 8.825% | 4/20/35 | 280,000 | 275,839 (a)(g)
GoldenTree Loan Management US CLO Ltd., 2022-16A DRR (3 mo. Term SOFR + 2.400%) | 6.725% | 1/20/38 | 1,260,000 | 1,253,775 (a)(g)
Golub Capital Partners CLO Ltd., 2024-76A E (3 mo. Term SOFR + 5.750%) | 10.068% | 10/25/37 | 300,000 | 304,597 (a)(g)
Greywolf CLO Ltd., 2019-1A CR2 (3 mo. Term SOFR + 3.500%) | 7.780% | 4/17/34 | 390,000 | 394,052 (a)(g)
Invesco CLO Ltd., 2021-3A DR (3 mo. Term SOFR + 3.100%) | 7.253% | 10/22/34 | 530,000 | 530,000 (a)(g)
Jamestown CLO Ltd., 2016-9A CR3 (3 mo. Term SOFR + 3.250%) | 7.506% | 7/25/34 | 550,000 | 551,416 (a)(g)
Magnetite Ltd., 2019-24A ER (3 mo. Term SOFR + 6.400%) | 10.718% | 4/15/35 | 200,000 | 201,932 (a)(g)
Magnetite Ltd., 2020-26A ER2 (3 mo. Term SOFR + 4.700%) | 9.018% | 1/25/38 | 1,050,000 | 1,044,036 (a)(g)
Magnetite Ltd., 2022-32A ER (3 mo. Term SOFR + 4.600%) | 8.782% | 10/15/37 | 820,000 | 819,847 (a)(g)
MidOcean Credit CLO LLC, 2025-18A E (3 mo. Term SOFR + 5.400%) | 9.718% | 10/18/35 | 910,000 | 906,276 (a)(g)
Mountain View CLO Ltd., 2022-1A DR (3 mo. Term SOFR + 4.190%) | 8.508% | 4/15/34 | 530,000 | 534,437 (a)(g)
Mountain View CLO Ltd., 2025-1A D1 (3 mo. Term SOFR + 3.400%) | 7.228% | 10/17/38 | 540,000 | 544,631 (a)(g)

See Notes to Financial Statements.
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

23

Schedule of investments (cont’d)
September 30, 2025
Western Asset High Income Opportunity Fund Inc.
(Percentages shown based on Fund net assets)

Security |  | Rate | Maturity Date | Face Amount† | Value
Asset-Backed Securities — continued
Nassau Ltd., 2021-IA DR (3 mo. Term SOFR + 3.600%) | 7.918% | 8/26/34 | 970,000 | $967,595 (a)(g)
Ocean Trails CLO Ltd., 2020-10A ER (3 mo. Term SOFR + 7.832%) | 12.149% | 10/15/34 | 1,000,000 | 1,003,800 (a)(g)
Ocean Trails CLO Ltd., 2022-12A ER (3 mo. Term SOFR + 7.500%) | 11.825% | 7/20/35 | 600,000 | 603,794 (a)(g)
OCP CLO Ltd., 2023-26A ER (3 mo. Term SOFR + 4.450%) | 8.772% | 4/17/37 | 600,000 | 589,851 (a)(g)
OHA Credit Funding Ltd., 2022-11A D1R (3 mo. Term SOFR + 2.850%) | 7.175% | 7/19/37 | 220,000 | 221,326 (a)(g)
Palmer Square CLO Ltd., 2022-3A D1R (3 mo. Term SOFR + 2.950%) | 7.275% | 7/20/37 | 310,000 | 312,334 (a)(g)
Palmer Square Loan Funding Ltd., 2024-1A D (3 mo. Term SOFR + 4.900%) | 9.218% | 10/15/32 | 550,000 | 543,563 (a)(g)
Peace Park CLO Ltd., 2021-1A ER (3 mo. Term SOFR + 4.900%) | 9.060% | 10/20/38 | 520,000 | 520,020 (a)(g)
RAD CLO Ltd., 2023-21A D1R (3 mo. Term SOFR + 2.600%) | 6.918% | 1/25/37 | 1,140,000 | 1,145,700 (a)(g)
RR Ltd., 2021-18A DR (3 mo. Term SOFR + 4.900%) | 9.140% | 7/15/40 | 800,000 | 809,955 (a)(g)
Trestles CLO Ltd., 2025-8A E (3 mo. Term SOFR + 5.500%) | 9.797% | 6/11/35 | 390,000 | 396,006 (a)(g)
Trinitas CLO Ltd., 2024-27A D1 (3 mo. Term SOFR + 4.300%) | 8.629% | 4/18/37 | 280,000 | 285,048 (a)(g)
Voya CLO Ltd., 2020-3A D1RR (3 mo. Term SOFR + 2.700%) | 7.025% | 1/20/38 | 970,000 | 978,119 (a)(g)
Warwick Capital CLO Ltd., 2024-3A D (3 mo. Term SOFR + 4.500%) | 8.825% | 4/20/37 | 140,000 | 140,885 (a)(g)
Total Asset-Backed Securities (Cost — $27,030,676) | 27,039,030
Sovereign Bonds — 1.3%
Angola — 0.4%
Angolan Government International Bond, Senior Notes | 8.000% | 11/26/29 | 1,600,000 | 1,562,871 (a)
Argentina — 0.5%
Provincia de Buenos Aires, Senior Notes | 6.625% | 9/1/37 | 345,522 | 202,562 (a)
Provincia de Cordoba, Senior Notes | 6.990% | 6/1/27 | 1,360,000 | 1,330,845 (a)
Provincia de Cordoba, Senior Notes | 6.875% | 2/1/29 | 340,000 | 314,500 (a)
Total Argentina | 1,847,907

See Notes to Financial Statements.

24
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

Western Asset High Income Opportunity Fund Inc.
(Percentages shown based on Fund net assets)

Security |  | Rate | Maturity Date | Face Amount† | Value
Bahamas — 0.4%
Bahamas Government International Bond, Senior Notes | 6.950% | 11/20/29 | 1,630,000 | $1,650,294 (a)
Total Sovereign Bonds (Cost — $4,154,448) | 5,061,072
|  |  |  | Shares |
Preferred Stocks — 0.4%
Financials — 0.4%
Mortgage Real Estate Investment Trusts (REITs) — 0.4%
AGNC Investment Corp., Non Voting Shares (3 mo. Term SOFR + 4.959%) | 9.276% |  | 32,708 | 829,475 (g)
Chimera Investment Corp., Non Voting Shares (3 mo. Term SOFR + 5.005%) | 8.981% |  | 10,320 | 238,392 (g)
MFA Financial Inc., Non Voting Shares (3 mo. Term SOFR + 5.607%) | 9.583% |  | 18,881 | 450,689 (g)
Total Preferred Stocks (Cost — $1,521,861) | 1,518,556
|  |  | Maturity Date | Face Amount† |
Convertible Bonds & Notes — 0.2%
Communication Services — 0.1%
Media — 0.1%
EchoStar Corp., Senior Secured Notes (3.875% Cash or 3.875% PIK) | 3.875% | 11/30/30 | 160,068 | 394,166 (d)
Consumer Discretionary — 0.1%
Hotels, Restaurants & Leisure — 0.1%
NCL Corp. Ltd., Senior Notes | 1.125% | 2/15/27 | 250,000 | 256,500
Industrials — 0.0%††
Aerospace & Defense — 0.0%††
AeroVironment Inc., Senior Notes | 0.000% | 7/15/30 | 52,000 | 64,558
Real Estate — 0.0%††
Real Estate Management & Development — 0.0%††
China Aoyuan Group Ltd., Senior Notes | 0.000% | 9/30/28 | 40,243 | 1,811 (c)
Total Convertible Bonds & Notes (Cost — $486,724) | 717,035
|  |  |  | Shares |
Common Stocks — 0.2%
Consumer Discretionary — 0.2%
Diversified Consumer Services — 0.2%
WW International Inc. |  | 24,439 | 668,651 *

See Notes to Financial Statements.
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

25

Schedule of investments (cont’d)
September 30, 2025
Western Asset High Income Opportunity Fund Inc.
(Percentages shown based on Fund net assets)

Security |  |  |  | Shares | Value
Industrials — 0.0%††
Passenger Airlines — 0.0%††
Spirit Airlines LLC |  | 346 | $131 *(h)(o)
Spirit Aviation Holdings Inc. |  | 59,529 | 22,621 *
Total Industrials | 22,752
Real Estate — 0.0%††
Real Estate Management & Development — 0.0%††
China Aoyuan Group Ltd. |  | 112,573 | 1,664 *(h)
Total Common Stocks (Cost — $1,253,845) | 693,067
|  | Rate | Maturity Date | Face Amount† |
Collateralized Mortgage Obligations(p) — 0.1%
LHOME Mortgage Trust, 2025-RTL1 M1 (Cost — $529,997) | 7.023% | 1/25/40 | 530,000 | 536,635 (a)(g)
|  |  | Expiration Date | Warrants |
Warrants — 0.0%††
Industrials — 0.0%††
Passenger Airlines — 0.0%††
Spirit Airlines LLC (Cost — $514,884) |  | 3/12/30 | 42,296 | 16,073 *(h)(o)
Total Investments before Short-Term Investments (Cost — $369,022,886) | 387,291,119
|  | Rate |  | Shares |
Short-Term Investments — 1.8%
Western Asset Premier Institutional Government Reserves, Premium Shares (Cost — $6,960,217) | 4.101% |  | 6,960,217 | 6,960,217 (q)(r)
Total Investments — 101.6% (Cost — $375,983,103) | 394,251,336
Liabilities in Excess of Other Assets — (1.6)% | (6,253,185 )
Total Net Assets — 100.0% | $387,998,151

See Notes to Financial Statements.

26
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

Western Asset High Income Opportunity Fund Inc.

† | Face amount denominated in U.S. dollars, unless otherwise noted.
†† | Represents less than 0.1%.
* | Non-income producing security.
(a) | Security is exempt from registration under Rule 144A of the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. This security has been deemed liquid pursuant to guidelines approved by the Board of Directors.
(b) | The coupon payment on this security is currently in default as of September 30, 2025.
(c) | Security is exempt from registration under Regulation S of the Securities Act of 1933. Regulation S applies to securities offerings that are made outside of the United States and do not involve direct selling efforts in the United States. This security has been deemed liquid pursuant to guidelines approved by the Board of Directors.
(d) | Payment-in-kind security for which the issuer has the option at each interest payment date of making interest payments in cash or additional securities.
(e) | Securities traded on a when-issued or delayed delivery basis.
(f) | Security has no maturity date. The date shown represents the next call date.
(g) | Variable rate security. Interest rate disclosed is as of the most recent information available. Certain variable rate securities are not based on a published reference rate and spread but are determined by the issuer or agent and are based on current market conditions. These securities do not indicate a reference rate and spread in their description above.
(h) | Security is fair valued in accordance with procedures approved by the Board of Directors (Note 1).
(i) | Security is valued using significant unobservable inputs (Note 1).
(j) | Value is less than $1.
(k) | The maturity principal is currently in default as of September 30, 2025.
(l) | Interest rates disclosed represent the effective rates on senior loans. Ranges in interest rates are attributable to multiple contracts under the same loan.
(m) | Senior loans may be considered restricted in that the Fund ordinarily is contractually obligated to receive approval from the agent bank and/or borrower prior to the disposition of a senior loan.
(n) | All or a portion of this loan has not settled as of September 30, 2025. Interest rates are not effective until settlement date. Interest rates shown, if any, are for the settled portion of the loan.
(o) | Restricted security (Note 8).
(p) | Collateralized mortgage obligations are secured by an underlying pool of mortgages or mortgage pass-through certificates that are structured to direct payments on underlying collateral to different series or classes of the obligations. The interest rate may change positively or inversely in relation to one or more interest rates, financial indices or other financial indicators and may be subject to an upper and/or lower limit.
(q) | Rate shown is one-day yield as of the end of the reporting period.
(r) | In this instance, as defined in the Investment Company Act of 1940, an “Affiliated Company” represents Fund ownership of at least 5% of the outstanding voting securities of an issuer, or a company which is under common ownership or control with the Fund. At September 30, 2025, the total market value of investments in Affiliated Companies was $6,960,217 and the cost was $6,960,217 (Note 7).

See Notes to Financial Statements.
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

27

Schedule of investments (cont’d)
September 30, 2025
Western Asset High Income Opportunity Fund Inc.

Abbreviation(s) used in this schedule:
CLO | — | Collateralized Loan Obligation
DAC | — | Designated Activity Company
EUR | — | Euro
GBP | — | British Pound
LIBOR | — | London Interbank Offered Rate
PIK | — | Payment-In-Kind
SOFR | — | Secured Overnight Financing Rate
USD | — | United States Dollar

At September 30, 2025, the Fund had the following open swap contracts:

CENTRALLY CLEARED CREDIT DEFAULT SWAPS ON CREDIT INDICES — SELL PROTECTION 1
Reference Entity | Notional Amount 2 | Termination Date | Periodic Payments Received by the Fund† | Market Value 3 | Upfront Premiums Paid (Received) | Unrealized Appreciation
Markit CDX.NA.HY.45 Index | $3,774,000 | 12/20/30 | 5.000% quarterly | $291,472 | $286,871 | $4,601

1 | If the Fund is a seller of protection and a credit event occurs, as defined under the terms of that particular swap agreement, the Fund will either (i) pay to the buyer of protection an amount equal to the notional amount of the swap and take delivery of the referenced obligation or underlying securities comprising the referenced index or (ii) pay a net settlement amount in the form of cash or securities equal to the notional amount of the swap less the recovery value of the referenced obligation or underlying securities comprising the referenced index.
2 | The maximum potential amount the Fund could be required to pay as a seller of credit protection or receive as a buyer of credit protection if a credit event occurs as defined under the terms of that particular swap agreement.
3 | The quoted market prices and resulting values for credit default swap agreements on asset-backed securities and credit indices serve as an indicator of the current status of the payment/performance risk and represent the likelihood of an expected loss (or profit) for the credit derivative had the notional amount of the swap agreement been closed/sold as of the period end. Decreasing market values (sell protection) or increasing market values (buy protection), when compared to the notional amount of the swap, represent a deterioration of the referenced entity’s credit soundness and a greater likelihood or risk of default or other credit event occurring as defined under the terms of the agreement.
† | Percentage shown is an annual percentage rate.

See Notes to Financial Statements.

28
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

Statement of assets and liabilities
September 30, 2025

Assets: |
Investments in unaffiliated securities, at value (Cost — $369,022,886) | $387,291,119
Investments in affiliated securities, at value (Cost — $6,960,217) | 6,960,217
Foreign currency, at value (Cost — $248,710) | 218,605
Cash | 62,820
Interest receivable | 6,323,312
Deposits with brokers for centrally cleared swap contracts | 279,860
Receivable for securities sold | 187,340
Receivable from brokers — net variation margin on centrally cleared swap contracts | 17,137
Dividends receivable from affiliated investments | 8,486
Principal paydown receivable | 2,910
Prepaid expenses | 11,680
Total Assets | 401,363,486
Liabilities: |
Payable for securities purchased | 9,512,340
Distributions payable | 3,376,022
Investment management fee payable | 239,580
Directors’ fees payable | 3,257
Accrued expenses | 234,136
Total Liabilities | 13,365,335
Total Net Assets | $387,998,151
Net Assets: |
Par value ($0.001 par value; 95,099,215 shares issued and outstanding; 500,000,000 shares authorized) | $95,099
Paid-in capital in excess of par value | 573,868,411
Total distributable earnings (loss) | (185,965,359 )
Total Net Assets | $387,998,151
Shares Outstanding | 95,099,215
Net Asset Value | $4.08

See Notes to Financial Statements.
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

29

Statement of operations
For the Year Ended September 30, 2025

Investment Income: |
Interest | $32,906,113
Dividends from affiliated investments | 157,904
Dividends from unaffiliated investments | 117,904
Total Investment Income | 33,181,921
Expenses: |
Investment management fee (Note 2) | 3,111,057
Legal fees | 171,660
Shareholder reports | 167,293
Directors’ fees | 148,967
Transfer agent fees | 69,494
Audit and tax fees | 57,065
Stock exchange listing fees | 48,704
Fund accounting fees | 20,156
Insurance | 2,336
Custody fees | 2,115
Miscellaneous expenses | 9,868
Total Expenses | 3,808,715
Less: Fee waivers and/or expense reimbursements (Note 2) | (198,341 )
Net Expenses | 3,610,374
Net Investment Income | 29,571,547
Realized and Unrealized Gain (Loss) on Investments, Swap Contracts, Forward Foreign Currency Contracts and Foreign Currency Transactions (Notes 1, 3 and 4):
Net Realized Gain From: |
Investment transactions in unaffiliated securities | 5,406,776
Swap contracts | 105,270
Forward foreign currency contracts | 247,503
Foreign currency transactions | 10,165
Net Realized Gain | 5,769,714
Change in Net Unrealized Appreciation (Depreciation) From: |
Investments in unaffiliated securities | (9,213,737 )
Swap contracts | 4,601
Foreign currencies | 30,077
Change in Net Unrealized Appreciation (Depreciation) | (9,179,059 )
Net Loss on Investments, Swap Contracts, Forward Foreign Currency Contracts and Foreign Currency Transactions | (3,409,345 )
Increase in Net Assets From Operations | $26,162,202

See Notes to Financial Statements.

30
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

Statements of changes in net assets

For the Years Ended September 30, | 2025 | 2024
Operations: |  |
Net investment income | $29,571,547 | $32,431,857
Net realized gain (loss) | 5,769,714 | (5,069,467 )
Change in net unrealized appreciation (depreciation) | (9,179,059 ) | 20,685,749
Increase in Net Assets From Operations | 26,162,202 | 48,048,139
Distributions to Shareholders From (Note 1): |  |
Total distributable earnings | (30,601,323 ) | (32,786,512 )
Return of capital | (9,910,943 ) | (7,725,754 )
Decrease in Net Assets From Distributions to Shareholders | (40,512,266 ) | (40,512,266 )
Increase (Decrease) in Net Assets | (14,350,064 ) | 7,535,873
Net Assets: |  |
Beginning of year | 402,348,215 | 394,812,342
End of year | $387,998,151 | $402,348,215

See Notes to Financial Statements.
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31

Financial highlights

For a share of capital stock outstanding throughout each year ended September 30:
| 2025 1 | 2024 1 | 2023 1 | 2022 1 | 2021 1
Net asset value, beginning of year | $4.23 | $4.15 | $4.22 | $5.45 | $5.27
Income (loss) from operations:
Net investment income | 0.31 | 0.34 | 0.35 | 0.33 | 0.32
Net realized and unrealized gain (loss) | (0.03 ) | 0.17 | (0.05 ) | (1.20 ) | 0.22
Total income (loss) from operations | 0.28 | 0.51 | 0.30 | (0.87) | 0.54
Less distributions from: |  |  |  |  |
Net investment income | (0.33 ) | (0.35 ) | (0.32 ) | (0.33 ) | (0.30 )
Return of capital | (0.10 ) | (0.08 ) | (0.05 ) | (0.03 ) | (0.07 )
Total distributions | (0.43 ) | (0.43 ) | (0.37 ) | (0.36 ) | (0.37 )
Anti-dilutive impact of tender offer | — | — | — | — | 0.01 2
Net asset value, end of year | $4.08 | $4.23 | $4.15 | $4.22 | $5.45
Market price, end of year | $3.84 | $4.05 | $3.64 | $3.68 | $5.19
Total return, based on NAV 3,4 | 7.05 % | 12.87 % | 7.12 % | (16.60 )% | 10.73 %
Total return, based on Market Price 5 | 5.53 % | 24.11 % | 8.67 % | (23.16 )% | 13.92 %
Net assets, end of year (millions) | $388 | $402 | $395 | $401 | $518
Ratios to average net assets:
Gross expenses | 0.98 % | 0.95 % | 0.94 % | 0.93 % | 0.91 %
Net expenses 6,7 | 0.93 | 0.93 | 0.94 | 0.93 | 0.89
Net investment income | 7.60 | 8.16 | 8.19 | 6.66 | 5.82
Portfolio turnover rate | 63 % | 45 % | 39 % | 79 % | 46 %

1 | Per share amounts have been calculated using the average shares method.
2 | The tender offer was completed at a price of $5.37 for 31,699,738 shares and $170,227,593 for the year ended September 30, 2021.
3 | Performance figures may reflect compensating balance arrangements, fee waivers and/or expense reimbursements. In the absence of compensating balance arrangements, fee waivers and/or expense reimbursements, the total return would have been lower. Past performance is no guarantee of future results.
4 | The total return calculation assumes that distributions are reinvested at NAV. Past performance is no guarantee of future results.
5 | The total return calculation assumes that distributions are reinvested in accordance with the Fund’s dividend reinvestment plan. Past performance is no guarantee of future results.
6 | The manager has agreed to waive the Fund’s management fee to an extent sufficient to offset the net management fee payable in connection with any investment in an affiliated money market fund.
7 | Reflects fee waivers and/or expense reimbursements.

See Notes to Financial Statements.

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Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

Notes to financial statements
1.Organization and significant accounting policies
Western Asset High Income Opportunity Fund Inc. (the “Fund”) was incorporated in Maryland and is registered as a diversified, closed-end management investment company under the Investment Company Act of 1940, as amended (the “1940 Act”). The Fund seeks high current income. Capital appreciation is a secondary objective. In seeking to fulfill its investment objectives, the Fund invests, under normal market conditions, at least 80% of its net assets in high-yield securities and up to 20% in common stock equivalents, including options, warrants and rights.
The Fund follows the accounting and reporting guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Topic 946, Financial Services – Investment Companies (“ASC 946”). The following are significant accounting policies consistently followed by the Fund and are in conformity with U.S. generally accepted accounting principles (“GAAP”), including, but not limited to, ASC 946. Estimates and assumptions are required to be made regarding assets, liabilities and changes in net assets resulting from operations when financial statements are prepared. Changes in the economic environment, financial markets and any other parameters used in determining these estimates could cause actual results to differ. Subsequent events have been evaluated through the date the financial statements were issued.
(a)Investment valuation. The valuations for fixed income securities (which may include, but are not limited to, corporate,government, municipal, mortgage-backed, collateralized mortgage obligations and asset-backed securities) and certain derivative instruments are typically the prices supplied by independent third party pricing services, which may use market prices or broker/dealer quotations or a variety of valuation techniques and methodologies. The independent third party pricing services typically use inputs that are observable such as issuer details, interest rates, yield curves, prepayment speeds, credit risks/spreads, default rates and quoted prices for similar securities. Investments in open-end funds are valued at the closing net asset value per share of each fund on the day of valuation. Equity securities for which market quotations are available are valued at the last reported sales price or official closing price on the primary market or exchange on which they trade. When the Fund holds securities or other assets that are denominated in a foreign currency, the Fund will normally use the currency exchange rates as of 4:00 p.m. (Eastern Time). If independent third party pricing services are unable to supply prices for a portfolio investment, or if the prices supplied are deemed by the manager to be unreliable, the market price may be determined by the manager using quotations from one or more broker/dealers or at the transaction price if the security has recently been purchased and no value has yet been obtained from a pricing service or pricing broker. When reliable prices are not readily available, such as when the value of a security has been significantly affected by events after the close of the exchange or market on which the security is principally traded, but before the Fund calculates its net asset value, the Fund values these securities as determined in accordance with procedures approved by the Fund’s Board of Directors (the “Board”).
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Notes to financial statements (cont’d)
Pursuant to policies adopted by the Board, the Fund’s manager has been designated as the valuation designee and is responsible for the oversight of the daily valuation process. The Fund’s manager is assisted by the Global Fund Valuation Committee (the “Valuation Committee”). The Valuation Committee is responsible for making fair value determinations, evaluating the effectiveness of the Fund’s pricing policies, and reporting to the Fund’s manager and the Board. When determining the reliability of third party pricing information for investments owned by the Fund, the Valuation Committee, among other things, conducts due diligence reviews of pricing vendors, monitors the daily change in prices and reviews transactions among market participants.
The Valuation Committee will consider pricing methodologies it deems relevant and appropriate when making fair value determinations. Examples of possible methodologies include, but are not limited to, multiple of earnings; discount from market of a similar freely traded security; discounted cash-flow analysis; book value or a multiple thereof; risk premium/yield analysis; yield to maturity; and/or fundamental investment analysis. The Valuation Committee will also consider factors it deems relevant and appropriate in light of the facts and circumstances. Examples of possible factors include, but are not limited to, the type of security; the issuer’s financial statements; the purchase price of the security; the discount from market value of unrestricted securities of the same class at the time of purchase; analysts’ research and observations from financial institutions; information regarding any transactions or offers with respect to the security; the existence of merger proposals or tender offers affecting the security; the price and extent of public trading in similar securities of the issuer or comparable companies; and the existence of a shelf registration for restricted securities.
For each portfolio security that has been fair valued pursuant to the policies adopted by the Board, the fair value price is compared against the last available and next available market quotations. The Valuation Committee reviews the results of such back testing monthly and fair valuation occurrences are reported to the Board quarterly.
The Fund uses valuation techniques to measure fair value that are consistent with the market approach and/or income approach, depending on the type of security and the particular circumstance. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable securities. The income approach uses valuation techniques to discount estimated future cash flows to present value.

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Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

GAAP establishes a disclosure hierarchy that categorizes the inputs to valuation techniques used to value assets and liabilities at measurement date. These inputs are summarized in the three broad levels listed below:
•
Level 1 — unadjusted quoted prices in active markets for identical investments
•
Level 2 — other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)
•
Level 3 — significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)
The inputs or methodologies used to value securities are not necessarily an indication of the risk associated with investing in those securities.
The following is a summary of the inputs used in valuing the Fund’s assets carried at fair value:

ASSETS
Description | Quoted Prices (Level 1) | Other Significant Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Total
Long-Term Investments†: |  |  |  |
Corporate Bonds & Notes: |  |  |  |
Energy | — | $63,873,364 | $875,851 | $64,749,215
Financials | — | 30,880,286 | 0 * | 30,880,286
Health Care | — | 28,140,417 | 0 * | 28,140,417
Other Corporate Bonds & Notes | — | 195,768,551 | — | 195,768,551
Senior Loans | — | 32,171,182 | — | 32,171,182
Asset-Backed Securities | — | 27,039,030 | — | 27,039,030
Sovereign Bonds | — | 5,061,072 | — | 5,061,072
Preferred Stocks | $1,518,556 | — | — | 1,518,556
Convertible Bonds & Notes | — | 717,035 | — | 717,035
Common Stocks: |  |  |  |
Consumer Discretionary | 668,651 | — | — | 668,651
Industrials | 22,621 | 131 | — | 22,752
Real Estate | — | 1,664 | — | 1,664
Collateralized Mortgage Obligations | — | 536,635 | — | 536,635
Warrants | — | 16,073 | — | 16,073
Total Long-Term Investments | 2,209,828 | 384,205,440 | 875,851 | 387,291,119
Short-Term Investments† | 6,960,217 | — | — | 6,960,217
Total Investments | $9,170,045 | $384,205,440 | $875,851 | $394,251,336
Other Financial Instruments: |  |  |  |
Centrally Cleared Credit Default Swaps on Credit Indices — Sell Protection†† | — | $4,601 | — | $4,601
Total | $9,170,045 | $384,210,041 | $875,851 | $394,255,937

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Notes to financial statements (cont’d)

† | See Schedule of Investments for additional detailed categorizations.
* | Amount represents less than $1.
†† | Reflects the unrealized appreciation (depreciation) of the instruments.

(b)Forward foreign currency contracts. The Fund enters into a forward foreign currency contract to hedge against foreign currency exchange rate risk on its non-U.S. dollar denominated securities or to facilitate settlement of a foreign currency denominated portfolio transaction. A forward foreign currency contract is an agreement between two parties to buy and sell a currency at a set price with delivery and settlement at a future date. The contract is marked-to-market daily and the change in value is recorded by the Fund as an unrealized gain or loss. When a forward foreign currency contract is closed, through either delivery or offset by entering into another forward foreign currency contract, the Fund recognizes a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value of the contract at the time it is closed.
Forward foreign currency contracts involve elements of market risk in excess of the amounts reflected on the Statement of Assets and Liabilities. The Fund bears the risk of an unfavorable change in the foreign exchange rate underlying the forward foreign currency contract. Risks may also arise upon entering into these contracts from the potential inability of the counterparties to meet the terms of their contracts.
(c)Swap agreements. The Fund invests in swaps for the purpose of managing its exposure to interest rate, credit or market risk, or for other purposes. The use of swaps involves risks that are different from those associated with other portfolio transactions. Swap agreements are privately negotiated in the over-the-counter market and may be entered into as a bilateral contract (“OTC Swaps”) or centrally cleared (“Centrally Cleared Swaps”). Unlike Centrally Cleared Swaps, the Fund has credit exposure to the counterparties of OTC Swaps.
In a Centrally Cleared Swap, immediately following execution of the swap, the swap agreement is submitted to a clearinghouse or central counterparty (the “CCP”) and the CCP becomes the ultimate counterparty of the swap agreement. The Fund is required to interface with the CCP through a broker, acting in an agency capacity. All payments are settled with the CCP through the broker. Upon entering into a Centrally Cleared Swap, the Fund is required to deposit initial margin with the broker in the form of cash or securities.
Swap contracts are marked-to-market daily and changes in value are recorded as unrealized appreciation (depreciation). The daily change in valuation of Centrally Cleared Swaps, if any, is recorded as a net receivable or payable for variation margin on the Statement of Assets and Liabilities. Gains or losses are realized upon termination of the swap agreement. Collateral, in the form of restricted cash or securities, may be required to be held in segregated accounts with the Fund’s custodian in compliance with the terms of the swap contracts. Securities posted as collateral for swap contracts are identified in the Schedule of Investments and restricted cash, if any, is identified on the Statement of Assets and Liabilities. Risks may exceed amounts recorded in the Statement of Assets and Liabilities. These risks include changes in the returns of the underlying instruments, failure

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Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

of the counterparties to perform under the contracts’ terms, and the possible lack of liquidity with respect to the swap agreements.
OTC Swap payments received or made at the beginning of the measurement period are reflected as a premium or deposit, respectively, on the Statement of Assets and Liabilities. These upfront payments are amortized over the life of the swap and are recognized as realized gain or loss in the Statement of Operations. Net periodic payments received or paid by the Fund are recognized as a realized gain or loss in the Statement of Operations.
The Fund’s maximum exposure in the event of a defined credit event on a credit default swap to sell protection is the notional amount. As of September 30, 2025, the total notional value of all credit default swaps to sell protection was $3,774,000. This amount would be offset by the value of the swap’s reference entity, upfront premiums received on the swap and any amounts received from the settlement of a credit default swap where the Fund bought protection for the same referenced security/entity.
For average notional amounts of swaps held during the year ended September 30, 2025, see Note 4.
Credit default swaps
The Fund enters into credit default swap (“CDS”) contracts for investment purposes, to manage its credit risk or to add leverage. CDS agreements involve one party making a stream of payments to another party in exchange for the right to receive a specified return in the event of a default by a third party, typically corporate or sovereign issuers, on a specified obligation, or in the event of a write-down, principal shortfall, interest shortfall or default of all or part of the referenced entities comprising a credit index. The Fund may use a CDS to provide protection against defaults of the issuers (i.e., to reduce risk where the Fund has exposure to an issuer) or to take an active long or short position with respect to the likelihood of a particular issuer’s default. As a seller of protection, the Fund generally receives an upfront payment or a stream of payments throughout the term of the swap, provided that there is no credit event. If the Fund is a seller of protection and a credit event occurs, as defined under the terms of that particular swap agreement, the maximum potential amount of future payments (undiscounted) that the Fund could be required to make under a CDS agreement would be an amount equal to the notional amount of the agreement. These amounts of potential payments will be partially offset by any recovery of values from the respective referenced obligations. As a seller of protection, the Fund effectively adds leverage to its portfolio because, in addition to its total net assets, the Fund is subject to investment exposure on the notional amount of the swap. As a buyer of protection, the Fund generally receives an amount up to the notional value of the swap if a credit event occurs.
Implied spreads are the theoretical prices a lender receives for credit default protection. When spreads rise, market perceived credit risk rises and when spreads fall, market perceived credit risk falls. The implied credit spread of a particular referenced entity reflects the cost of buying/selling protection and may include upfront payments required to enter into the agreement. Wider credit spreads and decreasing market values, when compared to
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Notes to financial statements (cont’d)
the notional amount of the swap, represent a deterioration of the referenced entity’s credit soundness and a greater likelihood or risk of default or other credit event occurring as defined under the terms of the agreement. Credit spreads utilized in determining the period end market value of CDS agreements on corporate or sovereign issues are disclosed in the Schedule of Investments and serve as an indicator of the current status of the payment/performance risk and represent the likelihood or risk of default for credit derivatives. For CDS agreements on asset-backed securities and credit indices, the quoted market prices and resulting values, particularly in relation to the notional amount of the contract as well as the annual payment rate, serve as an indication of the current status of the payment/performance risk.
The Fund’s maximum risk of loss from counterparty risk, as the protection buyer, is the fair value of the contract (this risk is mitigated by the posting of collateral by the counterparty to the Fund to cover the Fund’s exposure to the counterparty). As the protection seller, the Fund’s maximum risk is the notional amount of the contract. CDS are considered to have credit risk-related contingent features since they require payment by the protection seller to the protection buyer upon the occurrence of a defined credit event.
Entering into a CDS agreement involves, to varying degrees, elements of credit, market and documentation risk in excess of the related amounts recognized on the Statement of Assets and Liabilities. Such risks involve the possibility that there will be no liquid market for these agreements, that the counterparty to the agreement may default on its obligation to perform or disagree as to the meaning of the contractual terms in the agreement, and that there will be unfavorable changes in net interest rates.
(d)Loan participations. The Fund may invest in loans arranged through private negotiation between one or more financial institutions. The Fund’s investment in any such loan may be in the form of a participation in or an assignment of the loan. In connection with purchasing participations, the Fund generally will have no right to enforce compliance by the borrower with the terms of the loan agreement related to the loan, or any rights of offset against the borrower and the Fund may not benefit directly from any collateral supporting the loan in which it has purchased the participation.
The Fund assumes the credit risk of the borrower, the lender that is selling the participation and any other persons interpositioned between the Fund and the borrower. In the event of the insolvency of the lender selling the participation, the Fund may be treated as a general creditor of the lender and may not benefit from any offset between the lender and the borrower.
(e)Securities traded on a when-issued and delayed delivery basis. The Fund may trade securities on a when-issued or delayed delivery basis. In when-issued and delayed delivery transactions, the securities are purchased or sold by the Fund with payment and delivery taking place in the future in order to secure what is considered to be an advantageous price and yield to the Fund at the time of entering into the transaction.

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Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

Purchasing such securities involves risk of loss if the value of the securities declines prior to settlement. These securities are subject to market fluctuations and their current value is determined in the same manner as for other securities.
(f)Foreign currency translation. Investment securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollar amounts based upon prevailing exchange rates on the date of valuation. Purchases and sales of investment securities and income and expense items denominated in foreign currencies are translated into U.S. dollar amounts based upon prevailing exchange rates on the respective dates of such transactions.
The Fund does not isolate that portion of the results of operations resulting from fluctuations in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments.
Net realized foreign exchange gains or losses arise from sales of foreign currencies, including gains and losses on forward foreign currency contracts, currency gains or losses realized between the trade and settlement dates on securities transactions, and the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in the values of assets and liabilities, other than investments in securities, on the date of valuation, resulting from changes in exchange rates.
Foreign security and currency transactions may involve certain considerations and risks not typically associated with those of U.S. dollar denominated transactions as a result of, among other factors, the possibility of lower levels of governmental supervision and regulation of foreign securities markets and the possibility of political or economic instability.
(g)Credit and market risk. The Fund invests in high-yield and emerging market instruments that are subject to certain credit and market risks. The yields of high-yield and emerging market debt obligations reflect, among other things, perceived credit and market risks. The Fund’s investments in securities rated below investment grade typically involve risks not associated with higher rated securities including, among others, greater risk related to timely and ultimate payment of interest and principal, greater market price volatility and less liquid secondary market trading. The consequences of political, social, economic or diplomatic changes may have disruptive effects on the market prices of investments held by the Fund. The Fund’s investments in non-U.S. dollar denominated securities may also result in foreign currency losses caused by devaluations and exchange rate fluctuations.
(h)Foreign investment risks. The Fund’s investments in foreign securities may involve risks not present in domestic investments. Since securities may be denominated in foreign currencies, may require settlement in foreign currencies or may pay interest or dividends in foreign currencies, changes in the relationship of these foreign currencies to the U.S. dollar
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Notes to financial statements (cont’d)
can significantly affect the value of the investments and earnings of the Fund. Foreign investments may also subject the Fund to foreign government exchange restrictions, expropriation, taxation or other political, social or economic developments, all of which affect the market and/or credit risk of the investments.
(i)Counterparty risk and credit-risk-related contingent features of derivative instruments. The Fund may invest in certain securities or engage in other transactions where the Fund is exposed to counterparty credit risk in addition to broader market risks. The Fund may invest in securities of issuers, which may also be considered counterparties as trading partners in other transactions. This may increase the risk of loss in the event of default or bankruptcy by the counterparty or if the counterparty otherwise fails to meet its contractual obligations. The Fund’s subadviser attempts to mitigate counterparty risk by (i) periodically assessing the creditworthiness of its trading partners, (ii) monitoring and/or limiting the amount of its net exposure to each individual counterparty based on its assessment and (iii) requiring collateral from the counterparty for certain transactions. Market events and changes in overall economic conditions may impact the assessment of such counterparty risk by the subadviser. In addition, declines in the values of underlying collateral received may expose the Fund to increased risk of loss.
With exchange traded and centrally cleared derivatives, there is less counterparty risk to the Fund since the exchange or clearinghouse, as counterparty to such instruments, guarantees against a possible default. The clearinghouse stands between the buyer and the seller of the contract; therefore, the credit risk is limited to failure of the clearinghouse. While offset rights may exist under applicable law, the Fund does not have a contractual right of offset against a clearing broker or clearinghouse in the event of a default of the clearing broker or clearinghouse.
The Fund has entered into master agreements, such as an International Swaps and Derivatives Association, Inc. Master Agreement (“ISDA Master Agreement”) or similar agreement, with certain of its derivative counterparties that govern over-the-counter (“OTC”) derivatives and provide for general obligations, representations, agreements, collateral posting terms, netting provisions in the event of default or termination and credit related contingent features. The credit related contingent features include, but are not limited to, a percentage decrease in the Fund’s net assets or net asset value per share over a specified period of time. If these credit related contingent features were triggered, the derivatives counterparty could terminate the positions and demand payment or require additional collateral.
Under an ISDA Master Agreement, the Fund may, under certain circumstances, offset with the counterparty certain derivative financial instruments’ payables and/or receivables with collateral held and/or posted and create one single net payment. However, absent an event of default by the counterparty or a termination of the agreement, the terms of the ISDA Master Agreements do not result in an offset of reported amounts of financial assets and financial liabilities in the Statement of Assets and Liabilities across transactions between the Fund and the applicable counterparty. The enforceability of the right to offset may vary by jurisdiction.

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Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

Collateral requirements differ by type of derivative. Collateral or margin requirements are set by the broker or exchange clearinghouse for exchange traded derivatives while collateral terms are contract specific for OTC traded derivatives. Cash collateral that has been pledged to cover obligations of the Fund under derivative contracts, if any, will be reported separately in the Statement of Assets and Liabilities. Securities pledged as collateral, if any, for the same purpose are noted in the Schedule of Investments.
As of September 30, 2025, the Fund did not have any open OTC derivative transactions with credit related contingent features in a net liability position.
(j)Security transactions and investment income. Security transactions are accounted for on a trade date basis. Interest income (including interest income from payment-in-kind securities) is recorded on the accrual basis. Amortization of premiums and accretion of discounts on debt securities are recorded to interest income over the lives of the respective securities, except for premiums on certain callable debt securities, which are amortized to the earliest call date. Paydown gains and losses on mortgage- and asset-backed securities are recorded as adjustments to interest income. Dividend income is recorded on the ex-dividend date for dividends received in cash and/or securities. Foreign dividend income is recorded on the ex-dividend date or as soon as practicable after the Fund determines the existence of a dividend declaration after exercising reasonable due diligence. The cost of investments sold is determined by use of the specific identification method. To the extent any issuer defaults or a credit event occurs that impacts the issuer, the Fund may halt any additional interest income accruals and consider the realizability of interest accrued up to the date of default or credit event.
(k)Distributions to shareholders. Distributions from net investment income of the Fund, if any, are declared quarterly and paid on a monthly basis. Distributions of net realized gains, if any, are declared at least annually. The actual source of the Fund’s fiscal year distributions may be from net investment income, realized capital gains, return of capital or a combination of such amounts. Distributions to shareholders of the Fund are recorded on the ex-dividend date and are determined in accordance with income tax regulations, which may differ from GAAP.
(l)Compensating balance arrangements. The Fund had an arrangement with its custodian bank whereby a portion of the custodian’s fees was paid indirectly by credits earned on the Fund’s cash on deposit with the bank. Effective April 1, 2025, credits earned, if any, are recognized as income.
(m)Federal and other taxes. It is the Fund’s policy to comply with the federal income and excise tax requirements of the Internal Revenue Code of 1986 (the “Code”), as amended, applicable to regulated investment companies. Accordingly, the Fund intends to distribute its taxable income and net realized gains, if any, to shareholders in accordance with timing requirements imposed by the Code. Therefore, no federal or state income tax provision is required in the Fund’s financial statements.
Management has analyzed the Fund’s tax positions taken on income tax returns for all open tax years and has concluded that as of September 30, 2025, no provision for income tax is
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Notes to financial statements (cont’d)
required in the Fund’s financial statements. The Fund’s federal and state income and federal excise tax returns for tax years for which the applicable statutes of limitations have not expired are subject to examination by the Internal Revenue Service and state departments of revenue.
(n)Reclassification. GAAP requires that certain components of net assets be reclassified to reflect permanent differences between financial and tax reporting. These reclassifications have no effect on net assets or net asset value per share. During the current year, the Fund had no reclassifications.
2.Investment management agreement and other transactions with affiliates
Franklin Templeton Fund Adviser, LLC (“FTFA”) is the Fund’s investment manager. Western Asset Management Company, LLC (“Western Asset”) and Western Asset Management Company Limited (“Western Asset London”) are the Fund’s subadvisers. FTFA, Western Asset and Western Asset London are indirect, wholly-owned subsidiaries of Franklin Resources, Inc. (“Franklin Resources”).
FTFA provides administrative and certain oversight services to the Fund. The Fund pays FTFA an investment management fee, calculated daily and paid monthly, at an annual rate of 0.80% of the Fund’s average daily net assets.
FTFA delegates to Western Asset the day-to-day portfolio management of the Fund. Western Asset London provides certain subadvisory services to the Fund relating to currency transactions and investments in non-U.S. dollar denominated debt securities. Western Asset London does not receive any compensation from the Fund and is paid by Western Asset for its services to the Fund. For its services, FTFA pays Western Asset a fee monthly, at an annual rate equal to 70% of the net management fee it receives from the Fund. In turn, Western Asset pays Western Asset London a monthly subadvisory fee in an amount equal to 100% of the management fee paid to Western Asset on the assets that Western Asset allocates to Western Asset London to manage.
The manager has agreed to waive the Fund’s management fee to an extent sufficient to offset the net management fee payable in connection with any investment in an affiliated money market fund (the “affiliated money market fund waiver”).
Effective June 1, 2024, FTFA implemented a voluntary investment management fee waiver of 0.05% that will continue until June 30, 2026.
During the year ended September 30, 2025, fees waived and/or expenses reimbursed amounted to $198,341, which included an affiliated money market fund waiver of $3,900.
All officers and one Director of the Fund are employees of Franklin Resources or its affiliates and do not receive compensation from the Fund.

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Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

3.Investments
During the year ended September 30, 2025, the aggregate cost of purchases and proceeds from sales of investments (excluding short-term investments) were as follows:

Purchases | $242,869,287
Sales | 246,258,373

At September 30, 2025, the aggregate cost of investments and the aggregate gross unrealized appreciation and depreciation of investments for federal income tax purposes were as follows:

| Cost/Premiums Paid (Received) | Gross Unrealized Appreciation | Gross Unrealized Depreciation | Net Unrealized Appreciation
Securities | $378,844,918 | $30,075,305 | $(14,668,887) | $15,406,418
Swap contracts | 286,871 | 4,601 | — | 4,601

4.Derivative instruments and hedging activities
Below is a table, grouped by derivative type, that provides information about the fair value and the location of derivatives within the Statement of Assets and Liabilities at September 30, 2025.

ASSET DERIVATIVES 1
| Credit Risk
Centrally cleared swap contracts 2 | $4,601

1 | Generally, the balance sheet location for asset derivatives is receivables/net unrealized appreciation and for liability derivatives is payables/net unrealized depreciation.
2 | Includes cumulative unrealized appreciation (depreciation) of centrally cleared swap contracts as reported in the Schedule of Investments. Only net variation margin is reported within the receivables and/or payables on the Statement of Assets and Liabilities.

The following tables provide information about the effect of derivatives and hedging activities on the Fund’s Statement of Operations for the year ended September 30, 2025. The first table provides additional detail about the amounts and sources of gains (losses) realized on derivatives during the period. The second table provides additional information about the change in net unrealized appreciation (depreciation) resulting from the Fund’s derivatives and hedging activities during the period.

AMOUNT OF NET REALIZED GAIN (LOSS) ON DERIVATIVES RECOGNIZED
| Foreign Exchange Risk | Credit Risk | Total
Swap contracts | — | $105,270 | $105,270
Forward foreign currency contracts | $247,503 | — | 247,503
Total | $247,503 | $105,270 | $352,773

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Notes to financial statements (cont’d)

CHANGE IN NET UNREALIZED APPRECIATION (DEPRECIATION) ON DERIVATIVES RECOGNIZED
| Credit Risk
Swap contracts | $4,601

During the year ended September 30, 2025, the volume of derivative activity for the Fund was as follows:

| Average Market Value*
Forward foreign currency contracts (to buy)† | $722,334
Forward foreign currency contracts (to sell)† | 1,090,815
| Average Notional Balance**
Credit default swap contracts (buy protection)† | $290,769
Credit default swap contracts (sell protection) | 3,366,538

* | Based on the average of the market values at each month-end during the period.
† | At September 30, 2025, there were no open positions held in this derivative.
** | Based on the average of the notional amounts at each month-end during the period.

5.Distributions subsequent to September 30, 2025
The following distributions have been declared by the Board and are payable subsequent to the period end of this report:

Record Date | Payable Date | Amount
9/23/2025 | 10/1/2025 | $0.0355
10/24/2025 | 11/3/2025 | $0.0355
11/20/2025 | 12/1/2025 | $0.0355
12/23/2025 | 12/31/2025 | $0.0355
1/23/2026 | 1/30/2026 | $0.0355
2/20/2026 | 2/27/2026 | $0.0355

6.Stock repurchase program
On November 16, 2015, the Fund announced that the Board had authorized the Fund to repurchase in the open market up to approximately 10% of the Fund’s outstanding common stock when the Fund’s shares are trading at a discount to net asset value. The Board has directed management of the Fund to repurchase shares of common stock at such times and in such amounts as management reasonably believes may enhance stockholder value. The Fund is under no obligation to purchase shares at any specific discount levels or in any specific amounts. During the years ended September 30, 2025, and September 30, 2024, the Fund did not repurchase any shares.
Since the commencement of the stock repurchase program through September 30, 2025, the Fund repurchased 2,433,258 shares or 1.88% of its common shares outstanding for a total amount of $10,070,498.

44
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

7.Transactions with affiliated company
As defined by the 1940 Act, an affiliated company is one in which the Fund owns 5% or more of the outstanding voting securities, or a company which is under common ownership or control with the Fund. The following company was considered an affiliated company for all or some portion of the year ended September 30, 2025. The following transactions were effected in such company for the year ended September 30, 2025.

| Affiliate Value at September 30, 2024 | Purchased | Sold
Cost | Shares | Proceeds | Shares
Western Asset Premier Institutional Government Reserves, Premium Shares | $2,743,704 | $120,464,506 | 120,464,506 | $116,247,993 | 116,247,993

(cont’d) | Realized Gain (Loss) | Dividend Income | Net Increase (Decrease) in Unrealized Appreciation (Depreciation) | Affiliate Value at September 30, 2025
Western Asset Premier Institutional Government Reserves, Premium Shares | — | $157,904 | — | $6,960,217

8.Restricted securities
The following Fund investments are restricted as to resale and, in the absence of readily ascertainable market values, are fair valued in accordance with procedures approved by the Board.

Security | Number of Shares/ Warrants | Acquisition Date | Cost | Fair Value at 9/30/2025 | Value Per Share/Warrant | Percent of Net Assets
Spirit Airlines LLC, Common Shares | 346 | 3/25 | $4,212 | $131 | $0.38 | 0.00 %(a)
Spirit Airlines LLC, Warrants | 42,296 | 3/25 | 514,884 | 16,073 | 0.38 | 0.00 (a)
Total |  |  | $519,096 | $16,204 |  | 0.00 %(a)

(a) | Amount represents less than 0.005%.

Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

45

Notes to financial statements (cont’d)
9.Income tax information and distributions to shareholders
The tax character of distributions paid during the fiscal years ended September 30, was as follows:

| 2025 | 2024
Distributions paid from: |  |
Ordinary income | $30,601,323 | $32,786,512
Tax return of capital | 9,910,943 | 7,725,754
Total distributions paid | $40,512,266 | $40,512,266

As of September 30, 2025, the components of distributable earnings (loss) on a tax basis were as follows:

Deferred capital losses* | $(197,973,658)
Other book/tax temporary differences(a) | (3,376,023)
Unrealized appreciation (depreciation)(b) | 15,384,322
Total distributable earnings (loss) — net | $(185,965,359)

* | These capital losses have been deferred in the current year as either short-term or long-term losses. The losses will be deemed to occur on the first day of the next taxable year in the same character as they were originally deferred and will be available to offset future taxable capital gains.
(a) | Other book/tax temporary differences are attributable due to dividends payable.
(b) | The difference between book-basis and tax-basis unrealized appreciation (depreciation) is attributable to the tax deferral of losses on wash sales, the difference between book and tax amortization methods for premium on fixed income securities; book/tax differences in the accrual of interest income on securities in default and other book/tax basis adjustments.

10.Operating segments
The Fund operates as a single operating segment, which is an investment portfolio. A management group assigned to the Fund within the Fund’s investment manager serves as the Chief Operating Decision Maker (“CODM”) and is responsible for evaluating the Fund’s operating results and allocating resources in accordance with the Fund’s investment strategy. Internal reporting provided to the CODM aligns with the accounting policies and measurement principles used in the financial statements.
For information regarding segment assets, segment profit or loss, and significant expenses, refer to the Statement of Assets and Liabilities and the Statement of Operations, along with the related Notes to Financial Statements. The Fund’s Schedule of Investments provides details of the Fund’s investments that generate returns such as interest, dividends, and realized and unrealized gains or losses. Performance metrics, including portfolio turnover and expense ratios, are disclosed in the Financial Highlights.

46
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

Report of independent registered public accounting firm
To the Board of Directors and Shareholders of Western Asset High Income Opportunity Fund Inc.
Opinion on the Financial Statements
We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Western Asset High Income Opportunity Fund Inc. (the “Fund”) as of September 30, 2025, the related statement of operations for the year ended September 30, 2025, the statement of changes in net assets for each of the two years in the period ended September 30, 2025, including the related notes, and the financial highlights for each of the five years in the period ended September 30, 2025 (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of September 30, 2025, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period ended September 30, 2025 and the financial highlights for each of the five years in the period ended September 30, 2025 in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements are the responsibility of the Fund’s management. Our responsibility is to express an opinion on the Fund’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of September 30, 2025 by correspondence with the custodian, agent banks and brokers; when replies were not received, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.
/s/PricewaterhouseCoopers LLP
Baltimore, Maryland
November 20, 2025
We have served as the auditor of one or more investment companies in the Franklin Templeton Group of Funds since 1948.
Western Asset High Income Opportunity Fund Inc. 2025 Annual Report

47

Board approval of management and
subadvisory agreements (unaudited)
Background
The Investment Company Act of 1940, as amended (the “1940 Act”), requires that the Board of Directors (the “Board”) of Western Asset High Income Opportunity Fund Inc. (the “Fund”), including a majority of its members who are not considered to be “interested persons” under the 1940 Act (the “Independent Directors”) voting separately, approve on an annual basis the continuation of the investment management agreement (the “Management Agreement”) between the Fund and the Fund’s manager, Franklin Templeton Fund Adviser, LLC (the “Manager”), and the sub-advisory agreements (individually, a “Sub-Advisory Agreement,” and collectively, the “Sub-Advisory Agreements”) with the Manager’s affiliates, Western Asset Management Company, LLC (“Western Asset”) and Western Asset Management Company Limited (“Western Asset London,” and together with Western Asset, the “Sub-Advisers”), with respect to the Fund.
At an in-person meeting (the “Contract Renewal Meeting”) held on May 8-9, 2025, the Board, including the Independent Directors, considered and approved the continuation of each of the Management Agreement and the Sub-Advisory Agreements for an additional one-year period. To assist in its consideration of the renewal of each of the Management Agreement and the Sub-Advisory Agreements, the Board received and considered extensive information (together with the information provided at the Contract Renewal Meeting, the “Contract Renewal Information”) about the Manager and the Sub-Advisers, as well as the management and sub-advisory arrangements for the Fund and the other closed-end funds in the same complex under the Board’s purview (the “Franklin Templeton Closed-end Funds”), certain portions of which are discussed below.
A presentation made by the Manager and the Sub-Advisers to the Board at the Contract Renewal Meeting in connection with the Board’s evaluation of each of the Management Agreement and the Sub-Advisory Agreements encompassed the Fund and other Franklin Templeton Closed-end Funds. In addition to the Contract Renewal Information, the Board received performance and other information throughout the year related to the respective services rendered by the Manager and the Sub-Advisers to the Fund. The Board’s evaluation took into account the information received throughout the year and also reflected the knowledge and experience gained as members of the Boards of the Fund and other Franklin Templeton Closed-end Funds with respect to the services provided to the Fund by the Manager and the Sub-Advisers. The information received and considered by the Board (including its various committees) in conjunction with both the Contract Renewal Meeting and throughout the year was both written and oral. The contractual arrangements discussed below are the product of multiple years of review and negotiation and information received and considered by the Board during each of those years.
At a meeting held on April 25, 2025, the Independent Directors, in preparation for the Contract Renewal Meeting, met in a private session with their independent legal counsel to

48
Western Asset High Income Opportunity Fund Inc.

review the Contract Renewal Information regarding the Franklin Templeton Closed-end Funds, including the Fund, received to date. No representatives of the Manager or the Sub-Advisers participated in this meeting. Following the April 25, 2025 meeting, the Independent Directors submitted certain questions and requests for additional information to Fund management. The Independent Directors also met in private sessions with their independent legal counsel to consider the Contract Renewal Information and Fund management’s responses to the Independent Directors’ questions and requests for additional information in advance of and during the Contract Renewal Meeting. The discussion below reflects all of these reviews.
The Manager provides the Fund with investment advisory and administrative services pursuant to the Management Agreement and the Sub-Advisers together provide the Fund with investment sub-advisory services pursuant to the Sub-Advisory Agreements. The discussion below covers both the advisory and administrative functions being rendered by the Manager, each such function being encompassed by the Management Agreement, and the investment sub-advisory functions being rendered by the Sub-Advisers pursuant to the Sub-Advisory Agreements.
Board Approval of Management Agreement and Sub-Advisory Agreements
The Independent Directors were advised by separate independent legal counsel throughout the process. Prior to voting, the Independent Directors received a memorandum discussing the legal standards for their consideration of the proposed continuation of the Management Agreement and the Sub-Advisory Agreements. The Independent Directors considered the Management Agreement and each Sub-Advisory Agreement separately during the course of their review. In doing so, they noted the respective roles of the Manager and the Sub-Advisers in providing services to the Fund.
In approving the continuation of the Management Agreement and Sub-Advisory Agreements, the Board, including the Independent Directors, considered a variety of factors, including those factors discussed below. No single factor reviewed by the Board was identified by the Board as the principal factor in determining whether to approve the continuation of the Management Agreement and the Sub-Advisory Agreements. Each Director may have attributed different weight to the various factors in evaluating the Management Agreement and the Sub-Advisory Agreements.
After considering all relevant factors and information, the Board, exercising its reasonable business judgment, determined that the continuation of the Management Agreement and Sub-Advisory Agreements were in the best interests of the Fund’s stockholders and approved the continuation of each such agreement for an additional one-year period.
Western Asset High Income Opportunity Fund Inc.

49

Board approval of management and
subadvisory agreements (unaudited) (cont’d)
Nature, Extent and Quality of the Services under the Management Agreement and Sub-Advisory Agreements
The Board received and considered Contract Renewal Information regarding the nature, extent, and quality of services provided to the Fund by the Manager and the Sub-Advisers under the Management Agreement and the Sub-Advisory Agreements, respectively, during the past year. The Board noted information received at regular meetings throughout the year related to the services provided by the Manager in its management of the Fund’s affairs and the Manager’s role in coordinating the activities of the Sub-Advisers and the Fund’s other service providers. The Board observed that the scope of services provided by the Manager and the Sub-Advisers, and of the undertakings required of the Manager and Sub-Advisers in connection with those services, including maintaining and monitoring their respective compliance programs as well as the Fund’s compliance programs, had expanded over time as a result of regulatory, market and other developments. The Board also noted that on a regular basis it received and reviewed information from the Manager and the Sub-Advisers regarding the Fund’s compliance policies and procedures established pursuant to Rule 38a-1 under the 1940 Act. The Board also considered the risks borne by the Manager, the Sub-Advisers and their respective affiliates on behalf of the Fund, including entrepreneurial, operational, reputational, litigation and regulatory risks, as well as the Manager’s and the Sub-Advisers’ risk management processes.
The Board reviewed the qualifications, backgrounds, and responsibilities of the Manager’s senior personnel and the Sub-Advisers’ portfolio management teams primarily responsible for the day-to-day portfolio management of the Fund. The Board also considered, based on its knowledge of the Manager and its affiliates, the financial resources of Franklin Resources, Inc., the parent organization of the Manager and the Sub-Advisers. The Board recognized the importance of having a fund manager with significant resources.
The Board considered the division of responsibilities between the Manager and the Sub-Advisers under the Management Agreement and the Sub-Advisory Agreements, respectively, including the Manager’s coordination and oversight of the services provided to the Fund by the Sub-Advisers and other fund service providers and Western Asset’s coordination and oversight of the services provided to the Fund by Western Asset London. The Management Agreement permits the Manager to delegate certain of its responsibilities, including its investment advisory duties thereunder, provided that the Manager, in each case, will supervise the activities of the delegee.
In reaching its determinations regarding continuation of the Management Agreement and the Sub-Advisory Agreements, the Board took into account that Fund stockholders, in pursuing their investment goals and objectives, may have purchased their shares of the

50
Western Asset High Income Opportunity Fund Inc.

Fund based upon the reputation and the investment style, philosophy and strategy of the Manager and the Sub-Advisers, as well as the resources available to the Manager and the Sub-Advisers.
The Board concluded that, overall, the nature, extent, and quality of the management and other services provided (and expected to be provided) to the Fund, under the Management Agreement and the Sub-Advisory Agreements were satisfactory.
Fund Performance
The Board received and considered information regarding Fund performance, including information and analyses (the “Broadridge Performance Information”) for the Fund, as well as for a group of comparable funds (the “Performance Universe”) selected by Broadridge Financial Solutions, Inc. (“Broadridge”), an independent third-party provider of investment company data. The Board was provided with a description of the methodology Broadridge used to determine the similarity of the Fund with the funds included in the Performance Universe. It was noted that while the Board found the Broadridge Performance Information generally useful, they recognized its limitations, including that the data may vary depending on the end date selected, and that the results of the performance comparisons may vary depending on the selection of the peer group and its composition over time. The Board also noted that Board members had received and discussed with the Manager and the Sub-Advisers information throughout the year at periodic intervals comparing the Fund’s performance against its benchmark and against the Fund’s peers. In addition, the Board considered the Fund’s performance in view of overall financial market conditions.
The Broadridge Performance Information comparing the Fund’s performance to that of its Performance Universe, consisting of the Fund and all closed-end non-leveraged high yield funds, regardless of asset size, showed, among other data, that based on net asset value per share, the Fund’s performance was below the median for the 1-, 3-, 5- and 10-year periods ended December 31, 2024. The Board noted the explanations from the Manager and the Sub-Advisers regarding the Fund’s relative performance versus the Performance Universe for the various periods. The Board also noted the limited size of the Performance Universe.
Based on the reviews and discussions of Fund performance and considering other relevant factors, including an agreement at the Contract Renewal Meeting by the Manager to implement a new voluntary fee waiver of 0.05% through June 30, 2026 (the “Fee Waiver”) and other factors noted above, the Board concluded, under the circumstances, that continuation of the Management Agreement and the Sub-Advisory Agreements for an additional one-year period would be consistent with the interests of the Fund and its stockholders.
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51

Board approval of management and
subadvisory agreements (unaudited) (cont’d)
Management and Sub-Advisory Fees and Expense Ratios
The Board reviewed and considered the contractual management fee (the “Contractual Management Fee”) and the actual management fee (the “Actual Management Fee”) payable by the Fund to the Manager under the Management Agreement and the sub-advisory fees (the “Sub-Advisory Fees”) payable by the Manager to the Sub-Advisers under the Sub-Advisory Agreements in view of the nature, extent and overall quality of the management, investment advisory and other services provided by the Manager and the Sub-Advisers, respectively. The Board noted that the Sub-Advisory Fee payable to Western Asset under its Sub-Advisory Agreement with the Manager is paid by the Manager, not the Fund, and, accordingly, that the retention of Western Asset does not increase the fees or expenses otherwise incurred by the Fund’s stockholders. Similarly, the Board noted that the Sub-Advisory Fee payable to Western Asset London under its Sub-Advisory Agreement with Western Asset is paid by Western Asset, not the Fund, and, accordingly, that the retention of Western Asset London does not increase the fees or expenses otherwise incurred by the Fund’s stockholders.
In addition, the Board received and considered information and analyses prepared by Broadridge (the “Broadridge Expense Information”) comparing the Contractual Management Fee and the Actual Management Fee and the Fund’s total actual expenses with those of funds in an expense universe (the “Expense Universe”) selected and provided by Broadridge. The comparison was based upon the constituent funds’ latest fiscal years. It was noted that while the Board found the Broadridge Expense Information generally useful, they recognized its limitations, including that the data may vary depending on the selection of the peer group.
The Broadridge Expense Information showed that the Fund’s Contractual Management Fee was equal to the median. The Broadridge Expense Information also showed that the Fund’s Actual Management Fee was equal to the median. The Broadridge Expense Information also showed that the Fund’s actual total expenses were below the median. The Board took into account management’s discussion of the Fund’s expenses and noted the limited size of the Expense Universe. The Board also considered the Manager’s agreement to implement the Fee Waiver for a one-year period.
The Board also reviewed Contract Renewal Information regarding fees charged by the Manager and/or the Sub-Advisers to other U.S. clients investing primarily in an asset class similar to that of the Fund, including, where applicable, institutional and separate accounts. The Manager reviewed with the Board the differences in services provided to these different types of accounts, noting that the Fund is provided with certain administrative services, office facilities, and Fund officers, and that the Fund is subject not only to heightened regulatory requirements relative to institutional clients but also to requirements for listing on the New York Stock Exchange, and that the Manager coordinates and

52
Western Asset High Income Opportunity Fund Inc.

oversees the provision of services to the Fund by other fund service providers. The Board considered the fee comparisons in view of the different services provided in managing these other types of clients and funds.
The Board considered the overall management fee, the fees of the Sub-Advisers and the amount of the management fee retained by the Manager after payment of the subadvisory fees in each case in view of the services rendered for those amounts. The Board also received an analysis of complex-wide management fees provided by the Manager, which, among other things, set out a framework of fees based on asset classes.
Taking all of the above into consideration, as well as the factors identified below, the Board determined that the management fee and the Sub-Advisory Fees were reasonable in view of the nature, extent and overall quality of the management, investment advisory and other services provided by the Manager and the Sub-Advisers to the Fund under the Management Agreement and the Sub-Advisory Agreements, respectively.
Manager Profitability
The Board, as part of the Contract Renewal Information, received an analysis of the profitability to the Manager and its affiliates in providing services to the Fund for the Manager’s fiscal years ended September 30, 2024 and September 30, 2023. The Board also received profitability information with respect to the Franklin Templeton fund complex as a whole. In addition, the Board received Contract Renewal Information with respect to the Manager’s revenue and cost allocation methodologies used in preparing such profitability data. It was noted that the allocation methodologies had been reviewed by an outside consultant. The profitability to each of the Sub-Advisers was not considered to be a material factor in the Board’s considerations since the Sub-Advisory Fee is paid by the Manager in the case of Western Asset and by Western Asset in the case of Western Asset London, not the Fund, although the Board noted the affiliation of the Manager with the Sub-Advisers. The profitability of the Manager and its affiliates was considered by the Board to be reasonable in view of the nature, extent and quality of services provided to the Fund.
Economies of Scale
The Board received and discussed Contract Renewal Information concerning whether the Manager realizes economies of scale if the Fund’s assets grow. The Board noted that because the Fund is a closed-end fund it has limited ability to increase its assets. The Board determined that the management fee structure was appropriate under the circumstances. For similar reasons as stated above with respect to the Sub-Advisers’ profitability and the costs of the Sub-Advisers’ provision of services, the Board did not consider the potential for economies of scale in the Sub-Advisers’ management of the Fund to be a material factor in the Board’s consideration of the Sub-Advisory Agreements.
Western Asset High Income Opportunity Fund Inc.

53

Board approval of management and
subadvisory agreements (unaudited) (cont’d)
Other Benefits to the Manager and the Sub-Advisers
The Board considered other benefits received by the Manager, the Sub-Advisers and their affiliates as a result of their relationship with the Fund, including the opportunity to offer additional products and services to the Fund’s stockholders. In view of the costs of providing investment management and other services to the Fund and the ongoing commitment of the Manager and the Sub-Advisers to the Fund, the Board considered that the ancillary benefits that the Manager and its affiliates, including the Sub-Advisers, were reasonable.

54
Western Asset High Income Opportunity Fund Inc.

Additional information (unaudited)
Information about Directors and Officers
The business and affairs of Western Asset High Income Opportunity Fund Inc. (the “Fund”) are conducted by management under the supervision and subject to the direction of its Board of Directors. The business address of each Director is c/o Jane Trust, Franklin Templeton, One Madison Avenue, 17th Floor, New York, NY 10010.
Information pertaining to the Directors and officers of the Fund is set forth below. The Fund’s annual proxy statement includes additional information about Directors and is
available, without charge, upon request by calling the Fund at 1-888-777-0102.

Independent Directors†
Robert D. Agdern
Year of birth | 1950
Position(s) held with Fund 1 | Director and Member of Nominating, Audit, Compensation and Pricing and Valuation Committees, and Compliance Liaison, Class I
Term of office 1 and year service began | Since 2015
Principal occupation(s) during the past five years | Member of the Advisory Committee of the Dispute Resolution Research Center at the Kellogg Graduate School of Business, Northwestern University (2002 to 2016); formerly, Deputy General Counsel responsible for western hemisphere matters for BP PLC (1999 to 2001); Associate General Counsel at Amoco Corporation responsible for corporate, chemical, and refining and marketing matters and special assignments (1993 to 1998) (Amoco merged with British Petroleum in 1998 forming BP PLC)
Number of portfolios in fund complex 2 overseen by Director (including the Fund) | 21
Other board memberships held by Director during the past five years | None
Carol L. Colman
Year of birth | 1946
Position(s) held with Fund 1 | Director and Member of Nominating, Audit and Compensation Committees, and Chair of Pricing and Valuation Committee, Class I
Term of office 1 and year service began | Since 2007
Principal occupation(s) during the past five years | President, Colman Consulting Company (consulting)
Number of portfolios in fund complex 2 overseen by Director (including the Fund) | 21
Other board memberships held by Director during the past five years | None

Western Asset High Income Opportunity Fund Inc.

55

Additional information (unaudited) (cont’d)
Information about Directors and Officers

Independent Directors†(cont’d)
Anthony Grillo
Year of birth | 1955
Position(s) held with Fund 1 | Director and Member of Nominating, Audit, Compensation and Pricing and Valuation Committees, Class I
Term of office 1 and year service began | Since 2024
Principal occupation(s) during the past five years | Retired; Founder, Managing Director and Partner of American Securities Opportunity Funds (private equity and credit firm) (2006 to 2018); formerly, Senior Managing Director of Evercore Partners Inc. (investment banking) (2001 to 2004); Senior Managing Director of Joseph Littlejohn & Levy, Inc. (private equity firm) (1999 to 2001); Senior Managing Director of The Blackstone Group L.P. (private equity and credit firm) (1991 to 1999)
Number of portfolios in fund complex 2 overseen by Director (including the Fund) | 21
Other board memberships held by Director during the past five years | Director of Littelfuse, Inc. (electronics manufacturing) (since 1991); formerly, Director of Oaktree Acquisition Corp. II (2020 to 2022); Director of Oaktree Acquisition Corp. (2019 to 2021)
Eileen A. Kamerick
Year of birth | 1958
Position(s) held with Fund 1 | Chair (since November 15, 2024) and Member of Nominating, Compensation, Pricing and Valuation and Audit Committees, Class III
Term of office 1 and year service began | Since 2013
Principal occupation(s) during the past five years | Chief Executive Officer, The Governance Partners, LLC (consulting firm) (since 2015); National Association of Corporate Directors Board Leadership Fellow (since 2016, with Directorship Certification since 2019) and NACD 2022 Directorship 100 honoree; Adjunct Professor, Georgetown University Law Center (since 2021); Adjunct Professor, The University of Chicago Law School (since 2018); Adjunct Professor, University of Iowa College of Law (since 2007); formerly, Chief Financial Officer, Press Ganey Associates (health care informatics company) (2012 to 2014); Managing Director and Chief Financial Officer, Houlihan Lokey (international investment bank) and President, Houlihan Lokey Foundation (2010 to 2012)
Number of portfolios in fund complex 2 overseen by Director (including the Fund) | 21
Other board memberships held by Director during the past five years | Director, VALIC Company I (since October 2022); Director of ACV Auctions Inc. (since 2021); Director of Associated Banc-Corp (financial services company) (since 2007); formerly, Director of Hochschild Mining plc (precious metals company) (2016 to 2023); formerly Trustee of AIG Funds and Anchor Series Trust (2018 to 2021)

56
Western Asset High Income Opportunity Fund Inc.

Independent Directors†(cont’d)
Nisha Kumar
Year of birth | 1970
Position(s) held with Fund 1 | Director and Member of Nominating, Compensation and Pricing and Valuation Committees, and Chair of Audit Committee, Class III
Term of office 1 and year service began | Since 2019
Principal occupation(s) during the past five years | Formerly, Managing Director and the Chief Financial Officer and Chief Compliance Officer of Greenbriar Equity Group, LP (2011 to 2021); formerly, Chief Financial Officer and Chief Administrative Officer of Rent the Runway, Inc. (2011); Executive Vice President and Chief Financial Officer of AOL LLC, a subsidiary of Time Warner Inc. (2007 to 2009); Member of the Council on Foreign Relations
Number of portfolios in fund complex 2 overseen by Director (including the Fund) | 21
Other board memberships held by Director during the past five years | Director of Stonepeak-Plus Infrastructure Fund LP (since 2025); Director of Birkenstock Holding plc (since 2023); Director of The India Fund, Inc. (since 2016); formerly, Director of Aberdeen Income Credit Strategies Fund (2017 to 2018); and Director of The Asia Tigers Fund, Inc. (2016 to 2018)
Peter Mason
Year of birth | 1959
Position(s) held with Fund 1 | Director and Member of Audit, Nominating and Pricing and Valuation Committees, and Chair of Compensation Committee, Class II
Term of office 1 and year service began | Since 2024
Principal occupation(s) during the past five years | Arbitrator and Mediator (self-employed) (since 2021); formerly, Global General Counsel of UNICEF (intergovernmental organization) (1998 to 2021)
Number of portfolios in fund complex 2 overseen by Director (including the Fund) | 21
Other board memberships held by Director during the past five years | Chairman of University of Sydney USA Foundation (since 2020); Director of the Radio Workshop US, Inc. (since 2023)

Western Asset High Income Opportunity Fund Inc.

57

Additional information (unaudited) (cont’d)
Information about Directors and Officers

Independent Directors†(cont’d)
Hillary A. Sale
Year of birth | 1961
Position(s) held with Fund 1 | Director and Member of Audit, Compensation and Pricing and Valuation Committees, and Chair of Nominating Committee, Class II
Term of office 1 and year service began | Since 2024
Principal occupation(s) during the past five years | Agnes Williams Sesquicentennial Professor of Leadership and Corporate Governance, Georgetown Law; and Professor of Management, McDonough School of Business (since 2018); formerly, Associate Dean for Strategy, Georgetown Law (2020 to 2023); National Association of Corporate Directors Board Faculty Member (since 2021); formerly, a Member of the Board of Governors of FINRA (2016 to 2022)
Number of portfolios in fund complex 2 overseen by Director (including the Fund) | 21
Other board memberships held by Director during the past five years | Director of CBOE U.S. Securities Exchanges, CBOE Futures Exchange, and CBOE SEF, Director (since 2022); Advisory Board Member of Foundation Press (academic book publisher) (since 2019); Chair of DirectWomen Board Institute (since 2019); formerly, Member of DirectWomen Board (nonprofit) (2007 to 2022)

Interested Director and Officer
Jane Trust, CFA 3
Year of birth | 1962
Position(s) held with Fund 1 | Director, President and Chief Executive Officer, Class II
Term of office 1 and year service began | Since 2015
Principal occupation(s) during the past five years | Senior Vice President, Fund Board Management, Franklin Templeton (since 2020); Officer and/or Trustee/Director of 118 funds associated with FTFA or its affiliates (since 2015); Trustee of Putnam Family of Funds consisting of 105 portfolios; President and Chief Executive Officer of FTFA (since 2015); formerly, Senior Managing Director (2018 to 2020) and Managing Director (2016 to 2018) of Legg Mason & Co., LLC (“Legg Mason & Co.”); and Senior Vice President of FTFA (2015)
Number of portfolios in fund complex 2 overseen by Director (including the Fund) | Trustee/Director of Franklin Templeton funds consisting of 118 portfolios; Trustee of Putnam Family of Funds consisting of 105 portfolios
Other board memberships held by Director during the past five years | None

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Additional Officers
Fred Jensen |
Franklin Templeton One Madison Avenue, 17th Floor, New York, NY 10010 |
Year of birth | 1963
Position(s) held with Fund 1 | Chief Compliance Officer
Term of office 1 and year service began | Since 2020
Principal occupation(s) during the past five years | Director - Global Compliance of Franklin Templeton (since 2020); Managing Director of Legg Mason & Co. (2006 to 2020); Director of Compliance, Legg Mason Office of the Chief Compliance Officer (2006 to 2020); formerly, Chief Compliance Officer of Legg Mason Global Asset Allocation (prior to 2014); Chief Compliance Officer of Legg Mason Private Portfolio Group (prior to 2013); formerly, Chief Compliance Officer of The Reserve Funds (investment adviser, funds and broker-dealer) (2004) and Ambac Financial Group (investment adviser, funds and broker- dealer) (2000 to 2003)
Marc A. De Oliveira |
Franklin Templeton 100 First Stamford Place, 6th Floor, Stamford, CT 06902 |
Year of birth | 1971
Position(s) held with Fund 1 | Secretary and Chief Legal Officer
Term of office 1 and year service began | Since 2023
Principal occupation(s) during the past five years | Associate General Counsel of Franklin Templeton (since 2020); Secretary and Chief Legal Officer (since 2020) and Assistant Secretary of certain funds in the Franklin Templeton fund complex (since 2006); formerly, Managing Director (2016 to 2020) and Associate General Counsel of Legg Mason & Co. (2005 to 2020)
Thomas C. Mandia |
Franklin Templeton 100 First Stamford Place, 6th Floor, Stamford, CT 06902 |
Year of birth | 1962
Position(s) held with Fund 1 | Senior Vice President
Term of office 1 and year service began | Since 2022
Principal occupation(s) during the past five years | Senior Associate General Counsel to Franklin Templeton (since 2020); Senior Vice President (since 2020) and Assistant Secretary of certain funds in the Franklin Templeton fund complex (since 2006); Secretary of FTFA (since 2006); Secretary of LMAS (since 2002) and LMFAM (formerly registered investment advisers) (since 2013); formerly, Managing Director and Deputy General Counsel of Legg Mason & Co. (2005 to 2020)

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Additional information (unaudited) (cont’d)
Information about Directors and Officers

Additional Officers (cont’d)
Christopher Berarducci |
Franklin Templeton One Madison Avenue, 17th Floor, New York, NY 10010 |
Year of birth | 1974
Position(s) held with Fund 1 | Treasurer and Principal Financial Officer
Term of office 1 and year service began | Since 2019
Principal occupation(s) during the past five years | Vice President, Fund Administration and Reporting, Franklin Templeton (since 2020); Treasurer (since 2010) and Principal Financial Officer (since 2019) of certain funds associated with Legg Mason & Co. or its affiliates; formerly, Managing Director (2020), Director (2015 to 2020), and Vice President (2011 to 2015) of Legg Mason & Co.
Jeanne M. Kelly |
Franklin Templeton One Madison Avenue, 17th Floor, New York, NY 10010 |
Year of birth | 1951
Position(s) held with Fund 1 | Senior Vice President
Term of office 1 and year service began | Since 2007
Principal occupation(s) during the past five years | U.S. Fund Board Team Manager, Franklin Templeton (since 2020); Senior Vice President of certain funds associated with Legg Mason & Co. or its affiliates (since 2007); Senior Vice President of FTFA (since 2006); President and Chief Executive Officer of LMAS and LMFAM (since 2015); formerly, Managing Director of Legg Mason & Co. (2005 to 2020); and Senior Vice President of LMFAM (2013 to 2015)

†Directors who are not “interested persons” of the Fund within the meaning of Section 2(a)(19) of the 1940 Act.
1 The Fund’s Board of Directors is divided into three classes: Class I, Class II and Class III. The terms of office of the Class I, II and III Directors expire at the Annual Meetings of Stockholders in the year 2026, year 2027 and year 2028, respectively, or thereafter in each case when their respective successors are duly elected and qualified. The Fund’s executive officers are chosen each year, to hold office until their successors are duly elected and qualified.
2 The term “fund complex” means two or more registered investment companies that:
(a) hold themselves out to investors as related companies for purposes of investment and investor services; or
(b) have a common investment adviser or that have an investment adviser that is an affiliated person of the investment adviser of any of the other registered investment companies.
3 Ms. Trust is an “interested person” of the Fund as defined in the 1940 Act because Ms. Trust is an officer of FTFA and certain of its affiliates.
Daniel P. Cronin and Paolo M. Cucchi resigned from the Board effective December 31, 2024.

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Annual chief executive officer and
principal financial officer certifications (unaudited)
The Fund’s Chief Executive Officer (“CEO”) has submitted to the NYSE the required annual certification and the Fund also has included the Certifications of the Fund’s CEO and Principal Financial Officer required by Section 302 of the Sarbanes-Oxley Act in the Fund’s Form N-CSR filed with the SEC for the period of this report.
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Other shareholder communications regarding accounting matters (unaudited)
The Fund’s Audit Committee has established guidelines and procedures regarding the receipt, retention and treatment of complaints regarding accounting, internal accounting controls or auditing matters (collectively, “Accounting Matters”). Persons with complaints or concerns regarding Accounting Matters may submit their complaints to the Chief Compliance Officer (“CCO”). Persons who are uncomfortable submitting complaints to the CCO, including complaints involving the CCO, may submit complaints directly to the Fund’s Audit Committee Chair. Complaints may be submitted on an anonymous basis.
The CCO may be contacted at:
Franklin Resources Inc.
Compliance Department
One Madison Avenue, 17th Floor
New York, NY 10010
Complaints may also be submitted by telephone at 1-800-742-5274. Complaints submitted through this number will be received by the CCO.

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Summary of information regarding the Fund (unaudited)
Investment Objectives
The Fund’s primary investment objective is high current income and its secondary investment objective is capital appreciation.
Principal Investment Policies and Strategies
Under normal market conditions, the Fund will invest at least 80% of its net assets plus any borrowings for investment purposes in high-yield corporate debt securities and preferred stocks and up to 20% in common stock equivalents, including options, warrants and rights. The Fund may invest up to 15% of its assets in corporate loans.
The Fund may invest up to 20% of its total assets in the securities of foreign issuers that are denominated in currencies other than the U.S. dollar and may invest without limitation in securities of foreign issuers that are denominated in U.S. dollars.
The Fund may use a variety of derivative instruments for investment purposes as well as for hedging or risk management purposes. These derivative instruments may include futures contracts, forward contracts, credit default swaps, credit default swap index securities, swap agreements and options on such instruments. As part of its strategies, the Fund may invest in futures contracts; purchase and sell (or write) exchange-listed and over-the-counter put and call options on securities, financial indices and futures contracts; enter into interest rate and currency transactions; and enter into other similar transactions which may be developed in the future to the extent Western Asset determines that they are consistent with the investment objectives and policies and applicable regulatory requirements.
The Fund may engage in currency exchange transactions and purchase exchange-traded put and call options on foreign currencies. The Fund will conduct its currency exchange transactions either on a spot (i.e., cash) basis at the rate prevailing in the currency exchange market or by entering into forward contracts to purchase or sell currencies.
The Fund may invest up to 15% of its assets in illiquid securities.
The Fund may make short sales of securities in order to reduce market exposure and/or to increase its income if, at all times when a short position is open, the Fund owns an equal or greater amount of such securities or owns preferred stock, debt or warrants convertible or exchangeable into an equal or greater number of the shares of the securities sold short. Short sales of this kind are referred to as short sales “against the box.” The Fund will segregate the securities against which short sales against the box have been made in a special account with its custodian. Not more than 10% of the Fund’s total assets (taken at current value) may be held as collateral for such sales at any one time.
The Fund may enter into repurchase agreement transactions with certain member banks of the Federal Reserve System or with certain dealers listed on the Federal Reserve Bank of New York’s list of reporting dealers. The Fund may purchase securities on a when-issued
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Summary of information regarding the Fund (unaudited) (cont’d)
basis or for delayed delivery in accordance with applicable law. The Fund will not accrue income with respect to a when-issued or delayed delivery security prior to its stated delivery date. The Fund may invest in dollar rolls, asset-backed securities and mortgage-backed securities.
The Fund may invest in zero coupon, pay-in-kind and delayed interest securities as well as custodial receipts or certificates underwritten by securities dealers or banks that evidence ownership of future interest payments, principal payments or both on certain U.S. government securities.
The Fund is authorized to lend securities it holds to brokers, dealers and other financial organizations in accordance with applicable law. The amount of such loans, if and when made, may not exceed 20% of the value of the Fund’s assets.
Money market instruments that the Fund may acquire will be securities rated in the two highest short-term rating categories by Moody’s Investors Service, Inc. (“Moody’s”) or Standard & Poor’s Ratings Service (“S&P”) or the equivalent of such rating categories by another major rating service, or comparable unrated securities. If, in Western Asset’s judgment, conditions in the securities markets would make pursuing the basic investment strategy inconsistent with the stockholders’ best interests, the investment manager may employ alternative strategies, including investment of all of the Fund’s assets in securities rated investment grade by any nationally recognized statistical rating organization.
Principal Risk Factors
There is no assurance that the Fund will meet its investment objectives. You may lose money on your investment in the Fund. The value of the Fund’s shares may go up or down, sometimes rapidly and unpredictably. Market conditions, financial conditions of issuers represented in the Fund’s portfolio, investment strategies, portfolio management, and other factors affect the volatility of the Fund’s shares. An investment in the Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation, the Federal Reserve Board or any other government agency.
Investment and Market Risk. An investment in the Fund is subject to investment risk, including the possible loss of the entire amount that you invest. Your investment in the common shares of beneficial interest, par value $0.001 per share (the “Common Shares”) represents an indirect investment in the fixed income securities and other investments owned by the Fund, most of which could be purchased directly. The value of the Fund’s portfolio securities may move up or down, sometimes rapidly and unpredictably. At any point in time, your Common Shares may be worth less than your original investment, even after taking into account the reinvestment of Fund dividends and distributions.

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Fixed Income Securities Risk. In addition to the risks described elsewhere in this section with respect to valuations and liquidity, fixed income securities, including high-yield securities, are also subject to certain risks, including:
• Issuer Risk. The value of fixed income securities may decline for a number of reasons that directly relate to the issuer, such as management performance, financial leverage and reduced demand for the issuer’s goods and services.
• Interest Rate Risk. The market price of the Fund’s investments will change in response to changes in interest rates and other factors. During periods of declining interest rates, the market price of fixed income securities generally rises. Conversely, during periods of rising interest rates, the market price of such securities generally declines. The magnitude of these fluctuations in the market price of fixed income securities is generally greater for securities with longer maturities. Fluctuations in the market price of the Fund’s securities will not affect interest income derived from securities already owned by the Fund, but will be reflected in the Fund’s net asset value. The Fund may utilize certain strategies, including investments in structured notes or interest rate swap or cap transactions, for the purpose of reducing the interest rate sensitivity of the portfolio and decreasing the Fund’s exposure to interest rate risk, although there is no assurance that it will do so or that such strategies will be successful.
• Prepayment Risk. During periods of declining interest rates, the issuer of a security may exercise its option to prepay principal earlier than scheduled, forcing the Fund to reinvest the proceeds from such prepayment in lower yielding securities, which may result in a decline in the Fund’s income and distributions to stockholders. This is known as prepayment or “call” risk. Debt securities frequently have call features that allow the issuer to redeem the security at dates prior to its stated maturity at a specified price (typically greater than par) only if certain prescribed conditions are met. An issuer may choose to redeem a debt security if, for example, the issuer can refinance the debt at a lower cost due to declining interest rates or an improvement in the credit standing of the issuer.
• Reinvestment Risk. Reinvestment risk is the risk that income from the Fund’s portfolio will decline if and when the Fund invests the proceeds from matured, traded or called fixed income securities at market interest rates that are below the portfolio’s current earnings rate. A decline in income could affect the Fund’s Common Shares price or its overall return.
• Credit risk. If an issuer or guarantor of a security held by the Fund or a counterparty to a financial contract with the Fund defaults or its credit is downgraded, or is perceived to be less creditworthy, or if the value of the assets underlying a security declines, the value of your investment will typically decline. Changes in actual or perceived creditworthiness may occur quickly. The Fund could be delayed or hindered in its enforcement of rights against an issuer, guarantor or counterparty. Subordinated securities are more likely to suffer a credit
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Summary of information regarding the Fund (unaudited) (cont’d)
loss than non-subordinated securities of the same issuer and will be disproportionately affected by a default, downgrade or perceived decline in creditworthiness.
Liquidity Risk. The Fund may invest in illiquid securities. Illiquid securities are securities that cannot be disposed of within seven days in the ordinary course of business at approximately the value at which the Fund has valued the securities. Liquidity risk exists when particular investments are difficult to sell. Securities may become illiquid after purchase by the Fund, particularly during periods of market turmoil. When the Fund holds illiquid investments, the portfolio may be harder to value, especially in changing markets, and if the Fund is forced to sell these investments in order to segregate assets or for other cash needs, the Fund may suffer a loss.
Below Investment Grade (High-Yield or Junk) Securities Risk. The Fund may invest in high-yield debt securities. High yield debt securities are generally subject to greater credit risks than higher-grade debt securities, including the risk of default on the payment of interest or principal. High yield debt securities are considered speculative, typically have lower liquidity and are more difficult to value than higher grade bonds. High yield debt securities tend to be volatile and more susceptible to adverse events, credit downgrades and negative sentiments and may be difficult to sell at a desired price, or at all, during periods of uncertainty or market turmoil.
Foreign Securities and Emerging Markets Risk. A fund that invests in foreign (non-U.S.) securities may experience more rapid and extreme changes in value than a fund that invests exclusively in securities of U.S. companies. The securities markets of many foreign countries are relatively small, with a limited number of companies representing a small number of industries. Investments in foreign securities (including those denominated in U.S. dollars) are subject to economic and political developments in the countries and regions where the issuers operate or are domiciled, or where the securities are traded, such as changes in economic or monetary policies. Values may also be affected by restrictions on receiving the investment proceeds from a foreign country. Less information may be publicly available about foreign companies than about U.S. companies. Foreign companies are generally not subject to the same accounting, auditing and financial reporting standards as are U.S. companies. In addition, the Fund’s investments in foreign securities may be subject to the risk of nationalization or expropriation of assets, imposition of currency exchange controls or restrictions on the repatriation of foreign currency, confiscatory taxation, political or financial instability and adverse diplomatic developments. In addition, there may be difficulty in obtaining or enforcing a court judgment abroad. Dividends or interest on, or proceeds from the sale of, foreign securities may be subject to non-U.S. withholding taxes, and special U.S. tax considerations may apply.
The risks of foreign investment are greater for investments in emerging markets. The Fund considers a country to be an emerging market country if, at the time of investment, it is

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represented in the J.P. Morgan Emerging Markets Bond Index Global or categorized by the World Bank in its annual categorization as middle or low-income. Emerging market countries typically have economic and political systems that are less fully developed, and that can be expected to be less stable, than those of more advanced countries. Low trading volumes may result in a lack of liquidity and in price volatility. Emerging market countries may have policies that restrict investment by foreigners, that require governmental approval prior to investments by foreign persons, or that prevent foreign investors from withdrawing their money at will. An investment in emerging market securities should be considered speculative.
Non-U.S. Government, or Sovereign, Debt Securities Risk. The Fund invests in non-U.S. government, or sovereign, debt securities. Non-U.S. government, or sovereign, debt securities involve many of the risks of foreign and emerging markets investments as well as the risk of debt moratorium, repudiation or renegotiation, and the Fund may be unable to enforce its rights against the issuers. Sovereign debt risk is increased for emerging market issuers.
Currency Devaluation and Fluctuations. The value of investments in securities denominated in foreign currencies increases or decreases as the rates of exchange between those currencies and the U.S. dollar change. Currency conversion costs and currency fluctuations could erase investment gains or add to investment losses. Currency exchange rates can be volatile, and are affected by factors such as general economic conditions, the actions of the U.S. and foreign governments or central banks, the imposition of currency controls and speculation. The Fund may be unable or may choose not to hedge its foreign currency exposure.
U.S. Government Debt Securities Risk. Although the U.S. government guarantees principal and interest payments on securities issued by the U.S. government and some of its agencies, such as securities issued by the Government National Mortgage Association, this guarantee does not apply to losses resulting from declines in the market value of these securities.
Derivatives Risk. The Fund may utilize a variety of derivative instruments such as options, floors, caps and collars, futures contracts, forward contracts, options on futures contracts and indexed securities. Using derivatives can increase Fund losses and reduce opportunities for gains when market prices, interest rates, currencies, or the derivatives themselves behave in a way not anticipated by the Fund. Using derivatives also can have a leveraging effect and increase Fund volatility. Certain derivatives have the potential for unlimited loss, regardless of the size of the initial investment. Derivatives may not be available at the time or price desired, may be difficult to sell, unwind or value, and the counterparty may default on its obligations to the Fund. Derivatives are generally subject to the risks applicable to the assets, rates, indices or other indicators underlying the derivative. The value of a derivative
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Summary of information regarding the Fund (unaudited) (cont’d)
may fluctuate more than the underlying assets, rates, indices or other indicators to which it relates. Use of derivatives may have different tax consequences for the Fund than an investment in the underlying security, and those differences may affect the amount, timing and character of income distributed to shareholders. The U.S. government and foreign governments are in the process of adopting and implementing regulations governing derivatives markets, including mandatory clearing of certain derivatives, margin and reporting requirements. The ultimate impact of the regulations remains unclear. Additional regulation of derivatives may make derivatives more costly, limit their availability or utility, otherwise adversely affect their performance or disrupt markets.
Credit default swap contracts involve heightened risks and may result in losses to the Fund. Credit default swaps may be illiquid and difficult to value. When the Fund sells credit protection via a credit default swap, credit risk increases since the Fund has exposure to both the issuer whose credit is the subject of the swap and the counterparty to the swap.
The Fund operates under Rule 18f-4 under the 1940 Act which, among other things, governs the use of derivative investments and certain financing transactions (e.g., reverse repurchase agreements) by registered investment companies. Among other things, Rule 18f-4 requires funds that invest in derivative instruments beyond a specified limited amount to apply a VaR based limit to their use of certain derivative instruments and financing transactions and to adopt and implement a derivatives risk management program. Compliance with Rule 18f-4 by the Fund could, among other things, make derivatives more costly, limit their availability or utility, or otherwise adversely affect their performance. Rule 18f-4 may limit the Fund’s ability to use derivatives as part of its investment strategy.
Inflation/Deflation Risk. Inflation risk is the risk that the value of certain assets or income from the Fund’s investments will be worth less in the future as inflation decreases the value of money. As inflation increases, the real value of the Fund’s Common Shares and distributions on the Fund’s Common Shares can decline. Deflation risk is the risk that prices throughout the economy decline over time—the opposite of inflation. Deflation may have an adverse effect on the creditworthiness of issuers and may make issuer defaults more likely, which may result in a decline in the value of the Fund’s portfolio.
When-Issued and Delayed-Delivery Transactions Risk. The Fund may purchase fixed income securities on a when-issued basis, and may purchase or sell those securities for delayed delivery. When-issued and delayed-delivery transactions occur when securities are purchased or sold by the Fund with payment and delivery taking place in the future to secure an advantageous yield or price. Securities purchased on a when-issued or delayed-delivery basis may expose the Fund to counterparty risk of default as well as the risk that securities may experience fluctuations in value prior to their actual delivery. The Fund will not accrue income with respect to a when-issued or delayed-delivery security prior to its stated delivery date. Purchasing securities on a when-issued or delayed-delivery basis can

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involve the additional risk that the price or yield available in the market when the delivery takes place may not be as favorable as that obtained in the transaction itself.
Market Events Risk. The market values of securities or other assets will fluctuate, sometimes sharply and unpredictably, due to factors such as economic events, governmental actions or intervention, actions taken by the U.S. Federal Reserve or foreign central banks, market disruptions caused by trade disputes, labor strikes or other factors, political developments, armed conflicts, economic sanctions and countermeasures in response to sanctions, major cybersecurity events, the global and domestic effects of widespread or local health, weather or climate events, and other factors that may or may not be related to the issuer of the security or other asset. Economies and financial markets throughout the world are increasingly interconnected. Economic, financial or political events, trading and tariff arrangements, public health events, terrorism, wars, natural disasters and other circumstances in one country or region could have profound impacts on global economies or markets. As a result, whether or not the fund invests in securities of issuers located in or with significant exposure to the countries or markets directly affected, the value and liquidity of the fund’s investments may be negatively affected. Ongoing armed conflicts between Russia and Ukraine in Europe and among Israel, Iran, Hamas and other militant groups in the Middle East have caused and could continue to cause significant market disruptions and volatility. The hostilities and sanctions resulting from those hostilities have and could continue to have a significant impact on certain fund investments as well as fund performance and liquidity. Following Russia’s invasion of Ukraine in 2022, Russian stocks lost all, or nearly all, of their market value. Other securities or markets could be similarly affected by past or future geopolitical or other events or conditions. Furthermore, events involving limited liquidity, defaults, non-performance or other adverse developments that affect one industry, such as the financial services industry, or concerns or rumors about any events of these kinds, have in the past and may in the future lead to market-wide liquidity problems, may spread to other industries, and could negatively affect the value and liquidity of the fund’s investments.
The long-term impact of the COVID-19 pandemic and its subsequent variants on economies, markets, industries and individual issuers is not known. Some sectors of the economy and individual issuers have experienced or may experience particularly large losses. Periods of extreme volatility in the financial markets, reduced liquidity of many instruments, increased government debt, inflation, and disruptions to supply chains, consumer demand and employee availability, may continue for some time. The U.S. government and the Federal Reserve, as well as certain foreign governments and central banks, took extraordinary actions to support local and global economies and the financial markets in response to the COVID-19 pandemic. This and other government intervention into the economy and financial markets may not work as intended, and have resulted in a large expansion of government deficits and debt, the long term consequences of which are not known. In addition, the
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Summary of information regarding the Fund (unaudited) (cont’d)
COVID-19 pandemic, and measures taken to mitigate its effects, could result in disruptions to the services provided to the fund by its service providers.
Raising the ceiling on U.S. government debt has become increasingly politicized. Any failure to increase the total amount that the U.S. government is authorized to borrow could lead to a default on U.S. government obligations, with unpredictable consequences for economies and markets in the U.S. and elsewhere. Recently, inflation and interest rates have increased and may rise further. These circumstances could adversely affect the value and liquidity of the fund’s investments, impair the fund’s ability to satisfy redemption requests, and negatively impact the fund’s performance.
The United States and other countries are periodically involved in disputes over trade and other matters, which may result in tariffs, investment restrictions and adverse impacts on affected companies and securities. For example, the United States has imposed tariffs and other trade barriers on Chinese exports, has restricted sales of certain categories of goods to China, and has established barriers to investments in China. Trade disputes may adversely affect the economies of the United States and its trading partners, as well as companies directly or indirectly affected and financial markets generally. The United States government has prohibited U.S. persons from investing in Chinese companies designated as related to the Chinese military. These and possible future restrictions could limit the fund’s opportunities for investment and require the sale of securities at a loss or make them illiquid. Moreover, the Chinese government is involved in a longstanding dispute with Taiwan that has included threats of invasion. If the political climate between the United States and China does not improve or continues to deteriorate, if China were to attempt unification of Taiwan by force, or if other geopolitical conflicts develop or get worse, economies, markets and individual securities may be severely affected both regionally and globally, and the value of the fund’s assets may go down.
Credit Crisis Liquidity and Volatility Risk. The markets for credit instruments, including fixed income securities, have experienced periods of extreme illiquidity and volatility. General market uncertainty and consequent repricing risk have led to market imbalances of sellers and buyers, which in turn have also resulted in significant valuation uncertainties in a variety of debt securities, including certain fixed income securities. These conditions resulted, and in many cases continue to result in greater volatility, less liquidity, widening credit spreads and a lack of price transparency, with many debt securities remaining illiquid and of uncertain value. During times of reduced market liquidity, the Fund may not be able to sell securities readily at prices reflecting the values at which the securities are carried on the Fund’s books. Sales of large blocks of securities by market participants, such as the Fund, that are seeking liquidity can further reduce security prices in an illiquid market. These market conditions may make valuation of some of the Fund’s securities uncertain and/or result in sudden and significant valuation increases or decreases in its holdings.

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Illiquidity and volatility in the credit markets may directly and adversely affect the setting of dividend rates on the Common Shares.
Portfolio Turnover Risk. Changes to the investments of the Fund may be made regardless of the length of time particular investments have been held. A high portfolio turnover rate may result in increased transaction costs for the Fund in the form of increased dealer spreads and other transactional costs, which may have an adverse impact on the Fund’s performance. In addition, high portfolio turnover may result in the realization of net short-term capital gains by the Fund which, when distributed to stockholders, will be taxable as ordinary income. A high portfolio turnover may increase the Fund’s current and accumulated earnings and profits, resulting in a greater portion of the Fund’s distributions being treated as a dividend to the Fund’s stockholders. The portfolio turnover rate of the Fund will vary from year to year, as well as within a given year.
Temporary Defensive Strategies Risk. When Western Asset anticipates unusual market or other conditions, the Fund may temporarily depart from its principal investment strategies as a defensive measure and invest all or a portion of its assets in obligations of the U.S. government, its agencies or instrumentalities; other investment grade debt securities; investment grade commercial paper; certificates of deposit and bankers’ acceptances; repurchase agreements with respect to any of the foregoing investments or any other fixed income securities that Western Asset considers consistent with this strategy. To the extent that the Fund invests defensively, it may not achieve its investment objectives.
Market Price Discount from Net Asset Value Risk. Shares of closed-end investment companies frequently trade at a discount from their net asset value. This risk is separate and distinct from the risk that the Fund’s net asset value could decrease as a result of its investment activities and may be a greater risk to investors expecting to sell their Common Shares in a relatively short period. Whether investors will realize gains or losses upon the sale of Common Shares will depend not upon the Fund’s net asset value but upon whether the market price of Common Shares at the time of sale is above or below the investor’s purchase price for Common Shares. Because the market price of Common Shares will be determined by factors such as relative supply of and demand for Common Shares in the market, general market and economic conditions and other factors beyond the control of the Fund, the Fund cannot predict whether the Common Shares will trade at, above or below net asset value. The Common Shares are designed primarily for long-term investors and you should not view the Fund as a vehicle for trading purposes.
Anti-Takeover Provisions Risk. The Fund’s Charter and Bylaws include provisions that are designed to limit the ability of other entities or persons to acquire control of the Fund for short-term objectives, including by converting the Fund to open-end status or changing the composition of the Board, that may be detrimental to the Fund’s ability to achieve its primary investment objective of seeking high current income. The Fund’s Bylaws also
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Summary of information regarding the Fund (unaudited) (cont’d)
contains a provision providing that the Fund is subject to the provisions of the Maryland Control Share Acquisition Act. There can be no assurance, however, that such provisions will be sufficient to deter professional arbitrageurs that seek to cause the Fund to take actions that may not be consistent with its investment objective or aligned with the interests of long-term shareholders, such as liquidating debt investments prior to maturity, triggering taxable events for shareholders and decreasing the size of the Fund. Such provisions may limit the ability of shareholders to sell their shares at a premium over prevailing market prices by discouraging a third party from seeking to obtain control of the Fund. In determining to opt in to the MCSAA, the Board of Directors considered its fiduciary obligations to the Fund. In particular, the Board of Directors considered whether the interests of a short-term professional investor seeking to arbitrage the Fund’s market price would be consistent with the interests of Common Stockholders that invested in the Fund due to its investment objective of total return with an emphasis on income. In order to seek to allow the Fund to achieve its investment objective for those long-term Common Stockholders, the Board of Directors determined that it would be in the best interests of the Fund to opt in to the MCSAA. In making this decision, the Board of Directors considered a decision in the U.S. District Court for the District of Maryland, which had the effect of allowing a closed-end fund organized in Maryland to remain opted in to the MCSAA notwithstanding a counterclaim alleging that the fund’s decision to opt in to the MCSAA violated Section18(i) of the 1940 Act. A recent decision by the U.S. District Court for the Southern District of New York, however, held that certain Funds that opted into the MCSAA violated Section18(i) of the 1940 Act. The decision has been affirmed by the U.S. Court of Appeals for the Second Circuit. These decisions are incompatible with the prior decision in Maryland federal court that allowed a registered closed-end fund organized as a Maryland corporation to remain opted into the MCSAA, resulting in a circuit split on the issue. There is a risk that a court could follow the reasoning of the New York federal court, as opposed to the decision of the Maryland federal court, when determining whether a closed-end fund organized in Maryland can opt in to the MCSAA.
Potential Conflicts of Interest Risk. FTFA, Western Asset, Western Asset Management Company Limited (“Western Asset Limited” and together with FTFA and Western Asset, the “Managers”) and the Fund’s investment professionals have interests which may conflict with the interests of the Fund. In particular, the Managers also manage other closed-end funds listed on the NYSE that have investment objectives and investment strategies that are substantially similar to the Fund. Further, the Managers may at some time in the future manage and/or advise other investment funds or accounts with the same investment objective and strategies as the Fund. As a result, the Managers and the Fund’s investment professionals may devote unequal time and attention to the management of the Fund and those other funds and accounts, and may not be able to formulate as complete a strategy or identify equally attractive investment opportunities as might be the case if they were to

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Western Asset High Income Opportunity Fund Inc.

devote substantially more attention to the management of the Fund. The Managers and the Fund’s investment professionals may identify a limited investment opportunity that may be suitable for multiple funds and accounts, and the opportunity may be allocated among these several funds and accounts, which may limit the Fund’s ability to take full advantage of the investment opportunity. Additionally, transaction orders may be aggregated for multiple accounts for purpose of execution, which may cause the price or brokerage costs to be less favorable to the Fund than if similar transactions were not being executed concurrently for other accounts. At times, an investment professional may determine that an investment opportunity may be appropriate for only some accounts for which he or she exercises investment responsibility, or may decide that certain accounts should take differing positions with respect to a particular security. In these cases, the investment professional may place separate transactions for one or more funds or accounts which may affect the market price of the security or the execution of the transaction, or both, to the detriment or benefit of one or more other funds and accounts. For example, an investment professional may determine that it would be in the interest of another account to sell a security that the Fund holds, potentially resulting in a decrease in the market value of the security held by the Fund.
Operational Risk. The valuation of the Fund’s investments may be negatively impacted because of the operational risks arising from factors such as processing errors and human errors, inadequate or failed internal or external processes, failures in systems and technology, changes in personnel, and errors caused by third party service providers or trading counterparties. It is not possible to identify all of the operational risks that may affect the Fund or to develop processes and controls that completely eliminate or mitigate the occurrence of such failures. The Fund and its shareholders could be negatively impacted as a result.
Cybersecurity Risk. Like other funds and business enterprises, the fund, the manager, the subadvisers, Authorized Participants, the relevant listing exchange and their service providers are subject to the risk of cyber incidents occurring from time to time. Cybersecurity incidents, whether intentionally caused by third parties or otherwise, may allow an unauthorized party to gain access to fund assets, fund or customer data (including private shareholder information) or proprietary information, cause the fund, the manager, the subadvisers, Authorized Participants, the relevant listing exchange and/or their service providers (including, but not limited to, fund accountants, custodians, sub-custodians, transfer agents and financial intermediaries) to suffer data breaches, data corruption or loss of operational functionality, or prevent fund investors from purchasing, redeeming or exchanging shares, receiving distributions or receiving timely information regarding the fund or their investment in the fund. The fund, the manager, and the subadvisers have limited ability to prevent or mitigate cybersecurity incidents affecting third party service providers, and such third party service providers may have limited indemnification
Western Asset High Income Opportunity Fund Inc.

73

Summary of information regarding the Fund (unaudited) (cont’d)
obligations to the fund, the manager, and/or the subadvisers. Cybersecurity incidents may result in financial losses to the fund and its shareholders, and substantial costs may be incurred in order to prevent or mitigate any future cybersecurity incidents. Issuers of securities in which the fund invests are also subject to cybersecurity risks, and the value of these securities could decline if the issuers experience cybersecurity incidents.
New ways to carry out cyber attacks continue to develop. There is a chance that some risks have not been identified or prepared for, or that an attack may not be detected, which puts limitations on the fund’s ability to plan for or respond to a cyber attack.
More Information
For a complete list of the Fund’s fundamental investment restrictions and more detailed descriptions of the Fund’s investment policies, strategies and risks, see the Fund’s registration statement on Form N-14 that was declared effective by the SEC on May 24, 2016. The Fund’s fundamental investment restrictions may not be changed without the approval of the holders of a majority of the outstanding voting securities, as defined in the 1940 Act.

74
Western Asset High Income Opportunity Fund Inc.

Dividend reinvestment plan (unaudited)
Unless you elect to receive distributions in cash (i.e., opt-out), all dividends, including any capital gain dividends and return of capital distributions, on your Common Stock will be automatically reinvested by Computershare Trust Company, N.A., as agent for the stock- holders (the “Plan Agent”), in additional shares of Common Stock under the Fund’s Dividend Reinvestment Plan (the “Plan”). You may elect not to participate in the Plan by contacting the Plan Agent. If you do not participate, you will receive all cash distributions paid by check mailed directly to you by Computershare Trust Company, N.A., as dividend paying agent.
If you participate in the Plan, the number of shares of Common Stock you will receive will be determined as follows:
(1) If the market price of the Common Stock (plus $0.03 per share commission) on the payment date (or, if the payment date is not a NYSE trading day, the immediately preceding trading day) is equal to or exceeds the net asset value per share of the Common Stock at the close of trading on the NYSE on the payment date, the Fund will issue new Common Stock at a price equal to the greater of (a) the net asset value per share at the close of trading on the NYSE on the payment date or (b) 95% of the market price per share of the Common Stock on the payment date.
(2) If the net asset value per share of the Common Stock exceeds the market price of the Common Stock (plus $0.03 per share commission) at the close of trading on the NYSE on the payment date, the Plan Agent will receive the dividend or distribution in cash and will buy Common Stock in the open market, on the NYSE or elsewhere, for your account as soon as practicable commencing on the trading day following the payment date and terminating no later than the earlier of (a) 30 days after the dividend or distribution payment date, or (b) the payment date for the next succeeding dividend or distribution to be made to the stockholders; except when necessary to comply with applicable provisions of the federal securities laws. If during this period: (i) the market price (plus $0.03 per share commission) rises so that it equals or exceeds the net asset value per share of the Common Stock at the close of trading on the NYSE on the payment date before the Plan Agent has completed the open market purchases or (ii) if the Plan Agent is unable to invest the full amount eligible to be reinvested in open market purchases, the Plan Agent will cease purchasing Common Stock in the open market and the Fund shall issue the remaining Common Stock at a price per share equal to the greater of (a) the net asset value per share at the close of trading on the NYSE on the day prior to the issuance of shares for reinvestment or (b) 95% of the then current market price per share.
Common Stock in your account will be held by the Plan Agent in non-certificated form. Any proxy you receive will include all shares of Common Stock you have received under the Plan. You may withdraw from the Plan (i.e., opt-out) by notifying the Plan Agent in writing at P.O. Box 43006, Providence, RI 02940-3078 or by calling the Plan Agent at 1-888-888-0151. Such withdrawal will be effective immediately if notice is received by the Plan Agent not less than ten business days prior to any dividend or distribution record date; otherwise such
Western Asset High Income Opportunity Fund Inc.

75

Dividend reinvestment plan (unaudited) (cont’d)
withdrawal will be effective as soon as practicable after the Plan Agent’s investment of the most recently declared dividend or distribution on the Common Stock.
Plan participants who sell their shares will be charged a service charge (currently $5.00 per transaction) and the Plan Agent is authorized to deduct brokerage charges actually incurred from the proceeds (currently $0.05 per share commission). There is no service charge for reinvestment of your dividends or distributions in Common Stock. However, all participants will pay a pro rata share of brokerage commissions incurred by the Plan Agent when it makes open market purchases. Because all dividends and distributions will be automatically reinvested in additional shares of Common Stock, this allows you to add to your investment through dollar cost averaging, which may lower the average cost of your Common Stock over time. Dollar cost averaging is a technique for lowering the average cost per share over time if the Fund’s net asset value declines. While dollar cost averaging has definite advantages, it cannot assure profit or protect against loss in declining markets.
Automatically reinvesting dividends and distributions does not mean that you do not have to pay income taxes due upon receiving dividends and distributions. Investors will be subject to income tax on amounts reinvested under the Plan.
The Fund reserves the right to amend or terminate the Plan if, in the judgment of the Board of Directors, the change is warranted. The Plan may be terminated, amended or supplemented by the Fund upon notice in writing mailed to stockholders at least 30 days prior to the record date for the payment of any dividend or distribution by the Fund for which the termination or amendment is to be effective. Upon any termination, you will be sent cash for any fractional share of Common Stock in your account. You may elect to notify the Plan Agent in advance of such termination to have the Plan Agent sell part or all of your Common Stock on your behalf. Additional information about the Plan and your account may be obtained from the Plan Agent at P.O. Box 43006, Providence, RI 02940-3078 or by calling the Plan Agent at 1-888-888-0151.

76
Western Asset High Income Opportunity Fund Inc.

Important tax information (unaudited)
By mid-February, tax information related to a shareholder’s proportionate share of distributions paid during the preceding calendar year will be received, if applicable. Please also refer to www.franklintempleton.com for per share tax information related to any distributions paid during the preceding calendar year. Shareholders are advised to consult with their tax advisors for further information on the treatment of these amounts on their tax returns.
The following tax information for the Fund is required to be furnished to shareholders with respect to income earned and distributions paid during its fiscal year.
The Fund hereby reports the following amounts, or if subsequently determined to be different, the maximum allowable amounts, for the fiscal year ended September 30, 2025:

| Pursuant to: | Amount Reported
Qualified Net Interest Income (QII) | §871(k)(1)(C) | $15,694,518
Qualified Business Income Dividends Earned | §199A | $89,321
Section 163(j) Interest Earned | §163(j) | $30,680,134

Western Asset High Income Opportunity Fund Inc.

77

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Western Asset
High Income Opportunity Fund Inc.
Directors
Robert D. Agdern
Carol L. Colman
Anthony Grillo
Eileen A. Kamerick
Chair
Nisha Kumar
Peter Mason
Hillary A. Sale
Jane Trust
Officers
Jane Trust
President and Chief Executive
Officer
Christopher Berarducci
Treasurer and Principal Financial
Officer
Fred Jensen
Chief Compliance Officer
Marc A. De Oliveira
Secretary and Chief Legal Officer
Thomas C. Mandia
Senior Vice President
Jeanne M. Kelly
Senior Vice President
Western Asset High Income Opportunity Fund Inc.
One Madison Avenue
17th Floor
New York, NY 10010
Investment manager
Franklin Templeton Fund Adviser, LLC
Subadvisers
Western Asset Management Company, LLC
Western Asset Management Company Limited
Custodian
The Bank of New York Mellon
Transfer agent
Computershare Inc.
P.O. Box 43006
Providence, RI 02940-3078
Independent registered
public accounting firm
PricewaterhouseCoopers LLP
Baltimore, MD
Legal counsel
Simpson Thacher & Bartlett LLP
900 G Street NW
Washington, DC 20001
New York Stock
Exchange Symbol
HIO

Franklin Templeton Funds Privacy and Security Notice
Your Privacy and the Security of Your Personal Information is Very Important to Us
This Privacy and Security Notice (the “Privacy Notice”) addresses the Funds’ privacy and data protection practices with respect to nonpublic personal information the Fund receives. The Legg Mason Funds include the Western Asset Money Market Funds (Funds) sold by the Funds’ distributor, Franklin Distributors, LLC, as well as Legg Mason-sponsored closed-end funds. The provisions of this Privacy Notice apply to your information both while you are a shareholder and after you are no longer invested with the Funds.
The Type of Nonpublic Personal Information the Funds Collect About You
The Funds collect and maintain nonpublic personal information about you in connection with your shareholder account. Such information may include, but is not limited to:
• Personal information included on applications or other forms;
• Account balances, transactions, and mutual fund holdings and positions;
• Bank account information, legal documents, and identity verification documentation; and
• Online account access user IDs, passwords, security challenge question responses.
How the Funds Use Nonpublic Personal Information About You
The Funds do not sell or share your nonpublic personal information with third parties or with affiliates for their marketing purposes, unless you have authorized the Funds to do so. The Funds do not disclose any nonpublic personal information about you except as may be required to perform transactions or services you have authorized or as permitted or required by law. The Funds may disclose information about you to:
• Employees, agents, and affiliates on a “need to know” basis to enable the Funds to conduct ordinary business or to comply with obligations to government regulators;
• Service providers, including the Funds’ affiliates, who assist the Funds as part of the ordinary course of business (such as printing, mailing services, or processing or servicing your account with us) or otherwise perform services on the Funds’ behalf, including companies that may perform statistical analysis, market research and marketing services solely for the Funds;
• Permit access to transfer, whether in the United States or countries outside of the United States to such Funds’ employees, agents and affiliates and service providers as required to enable the Funds to conduct ordinary business, or to comply with obligations to government regulators;
• The Funds’ representatives such as legal counsel, accountants and auditors to enable the Funds to conduct ordinary business, or to comply with obligations to government regulators;
• Fiduciaries or representatives acting on your behalf, such as an IRA custodian or trustee of a grantor trust.
Except as otherwise permitted by applicable law, companies acting on the Funds’ behalf, including those outside the United States, are contractually obligated to keep nonpublic
NOT PART OF THE ANNUAL REPORT

Franklin Templeton Funds Privacy and Security Notice
(cont’d)
personal information the Funds provide to them confidential and to use the information the Funds share only to provide the services the Funds ask them to perform.
The Funds may disclose nonpublic personal information about you when necessary to enforce their rights or protect against fraud, or as permitted or required by applicable law, such as in connection with a law enforcement or regulatory request, subpoena, or similar legal process. In the event of a corporate action or in the event a Fund service provider changes, the Funds may be required to disclose your nonpublic personal information to third parties. While it is the Funds’ practice to obtain protections for disclosed information in these types of transactions, the Funds cannot guarantee their privacy policy will remain unchanged.
Keeping You Informed of the Funds’ Privacy and Security Practices
The Funds will notify you annually of their privacy policy as required by federal law. While the Funds reserve the right to modify this policy at any time, they will notify you promptly if this privacy policy changes.
The Funds’ Security Practices
The Funds maintain appropriate physical, electronic and procedural safeguards designed to guard your nonpublic personal information. The Funds’ internal data security policies restrict access to your nonpublic personal information to authorized employees, who may use your nonpublic personal information for Fund business purposes only.
Although the Funds strive to protect your nonpublic personal information, they cannot ensure or warrant the security of any information you provide or transmit to them, and you do so at your own risk. In the event of a breach of the confidentiality or security of your nonpublic personal information, the Funds will attempt to notify you as necessary so you can take appropriate protective steps. If you have consented to the Funds using electronic communications or electronic delivery of statements, they may notify you under such circumstances using the most current email address you have on record with them.
In order for the Funds to provide effective service to you, keeping your account information accurate is very important. If you believe that your account information is incomplete, not accurate or not current, if you have questions about the Funds’ privacy practices, or our use of your nonpublic personal information, write the Funds using the contact information on your account statements, email the Funds by clicking on the Contact Us section of the Funds’ website at www.franklintempleton.com, or contact the Funds at 1-877-721-1926 for the Western Asset Money Market Funds or 1-888-777-0102 for the Legg Mason-sponsored closed-end funds. For additional information related to certain state privacy rights, please visit https://www.franklintempleton.com/help/privacy-policy.
Revised December 2023.
NOT PART OF THE ANNUAL REPORT

Western Asset High Income Opportunity Fund Inc.
Western Asset High Income Opportunity Fund Inc.
One Madison Avenue
17th Floor
New York, NY 10010
Notice is hereby given in accordance with Section 23(c) of the Investment Company Act of 1940, as amended, that from time to time the Fund may purchase, at market prices, shares of its stock.
The Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (“SEC”) for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Forms N-PORT are available on the SEC’s website at www.sec.gov. To obtain information on Form N-PORT, shareholders can call the Fund at 1-888-777-0102.
Information on how the Fund voted proxies relating to portfolio securities during the prior 12-month period ended June 30th of each year and a description of the policies and procedures that the Fund uses to determine how to vote proxies related to portfolio transactions are available (1) without charge, upon request, by calling 1-888-777-0102, (2) at www.franklintempleton.com and (3) on the SEC’s website at www.sec.gov.
Quarterly performance, semi-annual and annual reports, current net asset value and other information regarding the Fund may be found on Franklin Templeton’s website, which can be accessed at www.franklintempleton.com. Any reference to Franklin Templeton’s website in this report is intended to allow investors public access to information regarding the Fund and does not, and is not intended to, incorporate Franklin Templeton’s website in this report.
This report is transmitted to the shareholders of Western Asset High Income Opportunity Fund Inc. for their information. This is not a prospectus, circular or representation intended for use in the purchase of shares of the Fund or any securities mentioned in this report.
Computershare Inc.
P.O. Box 43006
Providence, RI 02940-3078
90073-A 11/25

(b) Not applicable

ITEM 2. | CODE OF ETHICS.

(a) The Registrant has adopted a code of ethics that applies to its principal executive officers and principal financial and accounting officer.

(c) N/A

(d) N/A

(f) Pursuant to Item 19(a) (1), the Registrant is attaching as an exhibit a copy of its code of ethics that applies to its principal executive officers and principal financial and accounting officer.

ITEM 3. | AUDIT COMMITTEE FINANCIAL EXPERT.

The Board of Directors of the Registrant has determined that Eileen A. Kamerick and Nisha Kumar, possess the technical attributes identified in Item 3 to Form N-CSR to qualify as an “audit committee financial experts,” and has designated Eileen A. Kamerick and Nisha Kumar, as the Audit Committee’s financial experts. Eileen A. Kamerick and Nisha Kumar are an “independent” Trustee pursuant to paragraph (a)(2) of Item 3 to Form N-CSR.

Under applicable securities laws, a person determined to be an audit committee financial expert will not be deemed an “expert” for any purpose, including without limitation for the purposes of Section 11 of the Securities Act of 1933, as a result of being designated or identified as an audit committee financial expert. The designation or identification of a person as an audit committee financial expert does not impose on such person any duties, obligations, or liabilities greater than the duties, obligations, and liabilities imposed on such person as a member of the audit committee and board of directors in the absence of such designation or identification. The designation or identification of a person as an audit committee financial expert does not affect the duties, obligations, or liability of any other member of the audit committee or board of directors.

| ITEM 4. | PRINCIPAL ACCOUNTANT FEES AND SERVICES.

(a) Audit Fees. The aggregate fees billed in the last two fiscal years ending September 30, 2024 and September 30, 2025 (the “Reporting Periods”) for professional services rendered by the Registrant’s principal accountant (the “Auditor”) for the audit of the Registrant’s annual financial statements, or services that are normally provided by the Auditor in connection with the statutory and regulatory filings or engagements for the Reporting Periods, were $52,540 in September 30, 2024 and $53,065 in September 30, 2025.

(b) Audit-Related Fees. The aggregate fees billed in the Reporting Periods for assurance and related services by the Auditor that are reasonably related to the performance of the Registrant’s financial statements were $0 in September 30, 2024 and $0 in September 30, 2025.

(c) Tax Fees. The aggregate fees billed in the Reporting Periods for professional services rendered by the Auditor for tax compliance, tax advice and tax planning (“Tax Services”) were $10,000 in September 30, 2024 and $10,000 in September 30, 2025. These services consisted of (i) review or preparation of U.S. federal, state, local and excise tax returns; (ii) U.S. federal, state and local tax planning, advice and assistance regarding statutory, regulatory or administrative developments, and (iii) tax advice regarding tax qualification matters and/or treatment of various financial instruments held or proposed to be acquired or held.

There were no fees billed for tax services by the Auditors to the Registrant’s investment manager and any entity controlling, controlled by, or under common control with the investment manager that provides ongoing services to the Registrant (“Service Affiliates”) during the Reporting Periods that required pre-approval by the Audit Committee.

d) All Other Fees. The aggregate fees billed in the Reporting Periods for products and services provided by the Auditor to the Registrant, other than the services reported in paragraphs (a) through (c) of this item, were $0 in September 30, 2024 and $0 in September 30, 2025.

There were no other non-audit services rendered by the Auditor to the Service Affiliates requiring pre-approval by the Audit Committee in the Reporting Periods.

(e) Audit Committee’s pre–approval policies and procedures described in paragraph (c) (7) of Rule 2-01 of Regulation S-X.

(1) The Charter for the Audit Committee (the “Committee”) of the Board of each registered investment company (the “Fund”) advised by the Registrant’s investment manager or one of their affiliates (each, an “Adviser”) requires that the Committee shall approve (a) all audit and permissible non-audit services to be provided to the Fund and (b) all permissible non-audit services to be provided by the Fund’s independent auditors to the Adviser and any service providers controlling, controlled by or under common control with the Adviser that provide ongoing services to the Fund (“Covered Service Providers”) if the engagement relates directly to the operations and financial reporting of the Fund. The Committee may implement policies and procedures by which such services are approved other than by the full Committee.

The Committee shall not approve non-audit services that the Committee believes may impair the independence of the auditors. As of the date of the approval of this Audit Committee Charter, permissible non-audit services include any professional services (including tax services), that are not prohibited services as described below, provided to the Fund by the independent auditors, other than those provided to the Fund in connection with an audit or a review of the financial statements of the Fund. Permissible non-audit services may not include: (i) bookkeeping or other services related to the accounting records or financial statements of the Fund; (ii) financial information systems design and implementation; (iii) appraisal or valuation services, fairness opinions or contribution-in-kind reports; (iv) actuarial services; (v) internal audit outsourcing services; (vi) management functions or human resources; (vii) broker or dealer, investment adviser or investment banking services; (viii) legal services and expert services unrelated to the audit; and (ix) any other service the Public Company Accounting Oversight Board determines, by regulation, is impermissible.

Pre-approval by the Committee of any permissible non-audit services is not required so long as: (i) the aggregate amount of all such permissible non-audit services provided to the Fund, the Adviser and the Covered Service Providers constitutes not more than 5% of the total amount of revenues paid to the independent auditors during the fiscal year in which the permissible non-audit services are provided to (a) the Fund, (b) the Adviser and (c) any entity controlling, controlled by or under common control with the Adviser that provides ongoing services to the Fund during the fiscal year in which the services are provided that would have to be approved by the Committee; (ii) the permissible non-audit services were not recognized by the Fund at the time of the engagement to be non-audit services; and (iii) such services are promptly brought to the attention of the Committee and approved by the Committee (or its delegate(s)) prior to the completion of the audit.

(2) None of the services described in paragraphs (b) through (d) of this Item were performed in reliance on paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

(f) Not applicable.

(g) Non-audit fees billed by the Auditor for services rendered to the Registrant and the Service Affiliates during the reporting period were $334,889 in September 30, 2024 and $344,935 in September 30, 2025.

(h) Yes. The Registrant’s Audit Committee has considered whether the provision of non-audit services that were rendered to Service Affiliates, which were not pre-approved (not requiring pre-approval), is compatible with maintaining the Auditor’s independence. All services provided by the Auditor to the Registrant or to the Service Affiliates, which were required to be pre-approved, were pre-approved as required.

(i) Not applicable.

(j) Not applicable.

ITEM 5. | AUDIT COMMITTEE OF LISTED REGISTRANTS.

| a) | Registrant has a separately-designated standing Audit Committee established in accordance with Section 3(a)58(A) of the Exchange Act. The Audit Committee consists of the following Board members:

Robert D. Agdern

Carol L. Colman

Anthony Grillo*

Eileen A. Kamerick

Nisha Kumar

Peter Mason*

Hillary A. Sale*

* Effective November 15, 2024, Ms. Sale and Messrs. Grillo and Mason became members of the Audit Committee.

| b) | Not applicable

ITEM 6. | SCHEDULE OF INVESTMENTS.

| (a) | Please see schedule of investments contained in the Financial Statements and Financial Highlights included under Item 1 of this Form N-CSR.

| (b) | Not applicable.

| ITEM 7. | FINANCIAL STATEMENTS AND FINANCIAL HIGHLIGHTS FOR OPEN-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

| ITEM 8. | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS FOR OPEN-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

| ITEM 9. | PROXY DISCLOSURES FOR OPEN-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

| ITEM 10. | REMUNERATION PAID TO DIRECTORS, OFFICERS, AND OTHERS OF OPEN-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

| ITEM 11. | STATEMENT REGARDING BASIS FOR APPROVAL OF INVESTMENT ADVISORY CONTRACT.

The information is disclosed as part of the Financial Statements included in Item 1 of this Form N-CSR, as applicable.

| ITEM 12. | DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Western Asset Management Company, LLC Proxy Voting Policies and Procedures

| NOTE |

The policy below relating to proxy voting and corporate actions is a global policy for Western Asset Management Company, LLC (“Western Asset” or the “Firm”) and all Western Asset affiliates, including Western Asset Management Company Limited (“Western Asset Limited”), Western Asset Management Company Ltd (“Western Asset Japan”) and Western Asset Management Company Pte. Ltd. (“Western Asset Singapore”), as applicable. As compliance with the policy is monitored by Western Asset, the policy has been adopted from the US Compliance Manual and all defined terms are those defined in the US Compliance Manual rather than the compliance manual of any other Western Asset affiliate.

| BACKGROUND |

An investment adviser is required to adopt and implement policies and procedures that we believe are reasonably designed to ensure that proxies are voted in the best interest of clients, in accordance with fiduciary duties and Rule 206(4)-6 under the Investment Advisers Act of 1940 (“Advisers Act”). The authority to vote the proxies of our clients is established through investment management agreements or comparable documents. In addition to SEC requirements governing advisers, long-standing fiduciary standards and responsibilities have been established for ERISA accounts. Unless a manager of ERISA assets has been expressly precluded from voting proxies, the Department of Labor has determined that the responsibility for these votes lies with the investment manager.

| POLICY |

As a fixed income only manager, the occasion to vote proxies is very rare, for instance, when fixed income securities are converted into equity by their terms or in connection with a bankruptcy or corporate workout. However, the Firm has adopted and implemented policies and procedures that we believe are reasonably designed to ensure that proxies are voted in the best interest of clients, in accordance with our fiduciary duties and Rule 206(4)-6 under the Advisers Act. In addition to SEC requirements governing advisers, our proxy voting policies reflect the long-standing fiduciary standards and responsibilities for ERISA accounts. Unless a manager of ERISA assets has been expressly precluded from voting proxies, the Department of Labor has determined that the responsibility for these votes lies with the investment manager.

While the guidelines included in the procedures are intended to provide a benchmark for voting standards, each vote is ultimately cast on a case-by-case basis, taking into consideration the Firm’s contractual obligations to our clients and all other relevant facts and circumstances at the time of the vote (such that these guidelines may be overridden to the extent the Firm deems appropriate).

In exercising its voting authority, Western Asset will not consult or enter into agreements with officers, directors or employees of Franklin Resources (Franklin Resources includes Franklin Resources, Inc. and organizations operating as Franklin Resources) or any of its affiliates (other than Western Asset affiliated companies) regarding the voting of any securities owned by its clients.

| PROCEDURES |

Responsibility and Oversight

The Legal & Compliance Group is responsible for administering and overseeing the proxy voting process. The gathering of proxies is coordinated through the Corporate Actions team of the Investment Operations Group (“Corporate Actions”). Research analysts and portfolio managers are responsible for determining appropriate voting positions on each proxy utilizing any applicable guidelines contained in these procedures.

Client Authority

The Investment Management Agreement for each client is reviewed at account start-up for proxy voting instructions. If an agreement is silent on proxy voting, but contains an overall delegation of discretionary authority or if the account represents assets of an ERISA plan, Western Asset will assume responsibility for proxy voting. The Portfolio Compliance Group maintains a matrix of proxy voting authority.

Proxy Gathering

Registered owners of record, client custodians, client banks and trustees (“Proxy Recipients”) that receive proxy materials on behalf of clients should forward them to Corporate Actions. Proxy Recipients for new clients (or, if Western Asset becomes aware that the applicable Proxy Recipient for an existing client has changed, the Proxy Recipient for the existing client) are notified at start-up of appropriate routing to Corporate Actions of proxy materials received and reminded of their responsibility to forward all proxy materials on a timely basis. If Western Asset personnel other than Corporate Actions receive proxy materials, they should promptly forward the materials to Corporate Actions.

Proxy Voting

Once proxy materials are received by Corporate Actions, they are forwarded to the Portfolio Compliance Group for coordination and the following actions:

Proxies are reviewed to determine accounts impacted.

Impacted accounts are checked to confirm Western Asset voting authority.

Where appropriate, the Regulatory Affairs Group reviews the issues presented to determine any material conflicts of interest. (See Conflicts of Interest section of these procedures for further information on determining material conflicts of interest.)

If a material conflict of interest exists, (i) to the extent reasonably practicable and permitted by applicable law, the client is promptly notified, the conflict is disclosed and Western Asset obtains the client’s proxy voting instructions, and (ii) to the extent that it is not reasonably practicable or permitted by applicable law to notify the client and obtain such instructions (e.g., the client is a mutual fund or other commingled vehicle or is an ERISA plan client), Western Asset seeks voting instructions from an independent third party.

The Portfolio Compliance Group provides proxy material to the appropriate research analyst or portfolio manager to obtain their recommended vote. Research analysts and portfolio managers determine votes on a case-by-case basis taking into account the voting guidelines contained in these procedures. For avoidance of doubt, depending on the best interest of each individual client, Western Asset may vote the same proxy differently for different clients. The analyst’s or portfolio manager’s basis for their decision is documented and maintained by the Portfolio Compliance Group.

Portfolio Compliance Group votes the proxy pursuant to the instructions received in (d) or (e) and returns the voted proxy as indicated in the proxy materials.

| Timing |

Western Asset’s Legal and Compliance Department personnel act in such a manner to ensure that, absent special circumstances, the proxy gathering and proxy voting steps noted above can be completed before the applicable deadline for returning proxy votes.

| Recordkeeping |

Western Asset maintains records of proxies voted pursuant to Rule 204-2 of the Advisers Act and ERISA DOL Bulletin 94-2. These records include:

| · | A copy of Western Asset’s proxy voting policies and procedures.
| · | Copies of proxy statements received with respect to securities in client accounts.
| · | A copy of any document created by Western Asset that was material to making a decision how to vote proxies.
| · | Each written client request for proxy voting records and Western Asset’s written response to both verbal and written client requests.

A proxy log including:

| 1. | Issuer name;

| 2. | Exchange ticker symbol of the issuer’s shares to be voted;

| 3. | Committee on Uniform Securities Identification Procedures (“CUSIP”) number for the shares to be voted;

| 4. | A brief identification of the matter voted on;

| 5. | Whether the matter was proposed by the issuer or by a shareholder of the issuer;

| 6. | Whether a vote was cast on the matter;

| 7. | A record of how the vote was cast;

| 8. | Whether the vote was cast for or against the recommendation of the issuer’s management team;

| 9. | Funds are required to categorize their votes so that investors can focus on the topics they find important. Categories include, for example, votes related to director elections, extraordinary transactions, say-on-pay, shareholder rights and defenses, and the environment or climate, among others; and

| 10. | Funds are required to disclose the number of shares voted or instructed to be cast, as well as the number of shares loaned but not recalled and, therefore, not voted by the fund.

Records are maintained in an easily accessible place for a period of not less than five (5) years with the first two (2) years in Western Asset’s offices.

| Disclosure |

Western Asset’s proxy policies and procedures are described in the Firm’s Form ADV Part 2A. Clients are provided with a copy of these policies and procedures upon request. In addition, clients may receive reports on how their proxies have been voted, upon request.

Conflicts of Interest

All proxies that potentially present conflicts of interest are reviewed by the Regulatory Affairs Group for a materiality assessment. Issues to be reviewed include, but are not limited to:

| 1. | Whether Western Asset (or, to the extent required to be considered by applicable law, its affiliates) manages assets for the company or an employee group of the company or otherwise has an interest in the company;

| 2. | Whether Western Asset or an officer or director of Western Asset or the applicable portfolio manager or analyst responsible for recommending the proxy vote (together, “Voting Persons”) is a close relative of or has a personal or business relationship with an executive, director or person who is a candidate for director of the company or is a participant in a proxy contest; and

| 3. | Whether there is any other business or personal relationship where a Voting Person has a personal interest in the outcome of the matter before shareholders.

Voting Guidelines

Western Asset’s substantive voting decisions are based on the particular facts and circumstances of each proxy vote and are evaluated by the designated research analyst or portfolio manager. The examples outlined below are meant as guidelines to aid in the decision making process.

Situations can arise in which more than one Western Asset client invests in instruments of the same issuer or in which a single client may invest in instruments of the same issuer but in multiple accounts or strategies. Multiple clients or the same client in multiple accounts or strategies may have different investment objectives, investment styles, or investment professionals involved in making decisions. While there may be differences, votes are always cast in the best interests of the client and the investment objectives agreed with Western Asset. As a result, there may be circumstances where Western Asset casts different votes on behalf of different clients or on behalf of the same client with multiple accounts or strategies.

Guidelines are grouped according to the types of proposals generally presented to shareholders. Part I deals with proposals which have been approved and are recommended by a company’s board of directors; Part II deals with proposals submitted by shareholders for inclusion in proxy statements; Part III addresses issues relating to voting shares of investment companies; and Part IV addresses unique considerations pertaining to foreign issuers.

| I. | Board Approved Proposals

The vast majority of matters presented to shareholders for a vote involve proposals made by a company itself that have been approved and recommended by its board of directors. In view of the enhanced corporate governance practices currently being implemented in public companies, Western Asset generally votes in support of decisions reached by independent boards of directors. More specific guidelines related to certain board-approved proposals are as follows:

| 1. | Matters relating to the Board of Directors

Western Asset votes proxies for the election of the company’s nominees for directors and for board-approved proposals on other matters relating to the board of directors with the following exceptions:

| a. | Votes are withheld for the entire board of directors if the board does not have a majority of independent directors or the board does not have nominating, audit and compensation committees composed solely of independent directors.

| b. | Votes are withheld for any nominee for director who is considered an independent director by the company and who has received compensation from the company other than for service as a director.

| c. | Votes are withheld for any nominee for director who attends less than 75% of board and committee meetings without valid reasons for absences.

| d. | Votes are cast on a case-by-case basis in contested elections of directors.

| 2. | Matters relating to Executive Compensation

Western Asset generally favors compensation programs that relate executive compensation to a company’s long-term performance. Votes are cast on a case-by-case basis on board-approved proposals relating to executive compensation, except as follows:

| a. | Except where the firm is otherwise withholding votes for the entire board of directors, Western Asset votes for stock option plans that will result in a minimal annual dilution.

| b. | Western Asset votes against stock option plans or proposals that permit replacing or repricing of underwater options.

| c. | Western Asset votes against stock option plans that permit issuance of options with an exercise price below the stock’s current market price.

| d. | Except where the firm is otherwise withholding votes for the entire board of directors, Western Asset votes for employee stock purchase plans that limit the discount for shares purchased under the plan to no more than 15% of their market value, have an offering period of 27 months or less and result in dilution of 10% or less.

| 3. | Matters relating to Capitalization

The Management of a company’s capital structure involves a number of important issues, including cash flows, financing needs and market conditions that are unique to the circumstances of each company. As a result, Western Asset votes on a case-by-case basis on board-approved proposals involving changes to a company’s capitalization except where Western Asset is otherwise withholding votes for the entire board of directors.

| a. | Western Asset votes for proposals relating to the authorization of additional common stock.

| b. | Western Asset votes for proposals to effect stock splits (excluding reverse stock splits).

| c. | Western Asset votes for proposals authorizing share repurchase programs.

| 4. | Matters relating to Acquisitions, Mergers, Reorganizations and Other Transactions

Western Asset votes these issues on a case-by-case basis on board-approved transactions.

| 5. | Matters relating to Anti-Takeover Measures

Western Asset votes against board-approved proposals to adopt anti-takeover measures except as follows:

| a. | Western Asset votes on a case-by-case basis on proposals to ratify or approve shareholder rights plans.

| b. | Western Asset votes on a case-by-case basis on proposals to adopt fair price provisions.

| 6. | Other Business Matters

Western Asset votes for board-approved proposals approving such routine business matters such as changing the company’s name, ratifying the appointment of auditors and procedural matters relating to the shareholder meeting.

| a. | Western Asset votes on a case-by-case basis on proposals to amend a company’s charter or bylaws.

| b. | Western Asset votes against authorization to transact other unidentified, substantive business at the meeting.

| 7. | Reporting of Financially Material Information

Western Asset generally believes issuers should disclose information that is material to their business. What qualifies as “material” can vary, so votes are cast on a case-by-case basis but consistent with the overarching principle.

| II. | Shareholder Proposals

SEC regulations permit shareholders to submit proposals for inclusion in a company’s proxy statement. These proposals generally seek to change some aspect of a company’s corporate governance structure or to change some aspect of its business operations. Western Asset votes in accordance with the recommendation of the company’s board of directors on all shareholder proposals, except as follows:

| 1. | Western Asset votes for shareholder proposals to require shareholder approval of shareholder rights plans.

| 2. | Western Asset votes for shareholder proposals that are consistent with Western Asset’s proxy voting guidelines for board-approved proposals.

| 3. | Western Asset votes on a case-by-case basis on other shareholder proposals where the firm is otherwise withholding votes for the entire board of directors.

Environmental or social issues that are the subject of a proxy vote will be considered on a case-by-case basis. Constructive proposals that seek to advance the health of the issuer and the prospect for risk-adjusted returns to Western Assets clients are viewed more favorably than proposals that advance a single issue or limit the ability of management to meet its operating objectives.

III. | Voting Shares of Investment Companies

Western Asset may utilize shares of open or closed-end investment companies to implement its investment strategies. Shareholder votes for investment companies that fall within the categories listed in Parts I and II above are voted in accordance with those guidelines.

| 1. | Western Asset votes on a case-by-case basis on proposals relating to changes in the investment objectives of an investment company taking into account the original intent of the fund and the role the fund plays in the clients’ portfolios.

| 2. | Western Asset votes on a case-by-case basis all proposals that would result in increases in expenses (e.g., proposals to adopt 12b-1 plans, alter investment advisory arrangements or approve fund mergers) taking into account comparable expenses for similar funds and the services to be provided.

| IV. | Voting Shares of Foreign Issuers

In the event Western Asset is required to vote on securities held in non-U.S. issuers – i.e. issuers that are incorporated under the laws of a foreign jurisdiction and that are not listed on a U.S. securities exchange or the NASDAQ stock market, the following guidelines are used, which are premised on the existence of a sound corporate governance and disclosure framework. These guidelines, however, may not be appropriate under some circumstances for foreign issuers and therefore apply only where applicable.

| 1. | Western Asset votes for shareholder proposals calling for a majority of the directors to be independent of management.

| 2. | Western Asset votes for shareholder proposals seeking to increase the independence of board nominating, audit and compensation committees.

| 3. | Western Asset votes for shareholder proposals that implement corporate governance standards similar to those established under U.S. federal law and the listing requirements of U.S. stock exchanges, and that do not otherwise violate the laws of the jurisdiction under which the company is incorporated.

| 4. | Western Asset votes on a case-by-case basis on proposals relating to (1) the issuance of common stock in excess of 20% of a company’s outstanding common stock where shareholders do not have preemptive rights, or (2) the issuance of common stock in excess of 100% of a company’s outstanding common stock where shareholders have preemptive rights.

| V. | Environmental, Social and Governance (“ESG”) Matters

Western Asset incorporates ESG considerations, among other relevant risks, as part of the overall process where appropriate. The Firm seeks to identify and consider material risks to the investment thesis, including material risks presented by ESG factors. While Western Asset is primarily a fixed income manager, opportunities to vote proxies are considered on the investment merits of the instruments and strategies involved.

As a general proposition, Western Asset votes to encourage disclosure of information material to their business. This principle extends to ESG matters. What qualifies as “material” can vary, so votes are cast on a case-by-case basis but consistent with the overarching principle. Western Asset recognizes that objective standards and criteria may not be available or universally agreed and that there may be different views and subjective analysis regarding factors and their significance.

Targeted environmental or social issues that are the subject of a proxy vote will be considered on a case-by-case basis. Constructive proposals that seek to advance the health of the issuer and the prospect for risk-adjusted returns to Western Assets clients are viewed more favorably than proposals that advance a single issue or limit the ability of management to meet its operating objectives.

Retirement Accounts

For accounts subject to ERISA, as well as other retirement accounts, Western Asset is presumed to have the responsibility to vote proxies for the client. The Department of Labor has issued a bulletin that states that investment managers have the responsibility to vote proxies on behalf of Retirement Accounts unless the authority to vote proxies has been specifically reserved to another named fiduciary. Furthermore, unless Western Asset is expressly precluded from voting the proxies, the Department of Labor has determined that the responsibility remains with the investment manager.

In order to comply with the Department of Labor’s position, Western Asset will be presumed to have the obligation to vote proxies for its retirement accounts unless Western Asset has obtained a specific written instruction indicating that: (a) the right to vote proxies has been reserved to a named fiduciary of the client, and (b) Western Asset is precluded from voting proxies on behalf of the client. If Western Asset does not receive such an instruction, Western Asset will be responsible for voting proxies in the best interests of the retirement account client and in accordance with any proxy voting guidelines provided by the client.

| ITEM 13. | PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

(a)(1): As of the date of filing this report:

NAME AND ADDRESS | LENGTH OF TIME SERVED | PRINCIPAL OCCUPATION(S) DURING PAST 5 YEARS
Michael C. Buchanan Western Asset 385 East Colorado Blvd. Pasadena, CA 91101 | Since 2006 | Responsible for the day-to-day management with other members of the Fund’s portfolio management team; Chief Investment Officer of Western Asset since September 2024; employed by Western Asset Management as an investment professional for at least the past five years; Managing Director and head of U.S. Credit Products from 2003-2005 at Credit Suisse Asset Management
Christopher F. Kilpatrick Western Asset 385 East Colorado Blvd. Pasadena, CA 91101 | Since 2012 | Responsible for the day-to-day management with other members of the Fund’s portfolio management team; employed by Western Asset Management as an investment professional for at least the past five years.
Walter Kilcullen Western Asset 385 East Colorado Blvd. Pasadena, CA 91101 | Since 2024 | Responsible for the day-to-day management with other members of the Fund’s portfolio management team; employed by Western Asset Management as an investment professional since 2002.

(a)(2): DATA TO BE PROVIDED BY FINANCIAL CONTROL

The following tables set forth certain additional information with respect to the fund’s investment professionals for the fund. Unless noted otherwise, all information is provided as of September 30, 2025.

Other Accounts Managed by Investment Professionals

The table below identifies the number of accounts (other than the fund) for which the fund’s investment professionals have day-to-day management responsibilities and the total assets in such accounts, within each of the following categories: registered investment companies, other pooled investment vehicles, and other accounts. For each category, the number of accounts and total assets in the accounts where fees are based on performance is also indicated.

Name of PM | Type of Account | Number of Accounts Managed | Total Assets Managed | Number of Accounts Managed for which Advisory Fee is Performance-Based | Assets Managed for which Advisory Fee is Performance-Based
Michael C. Buchanan ‡ | Other Registered Investment Companies | 58 | $85.01 billion | None | None
Other Pooled Vehicles | 194 | $45.31 billion | 16 | $3.01 billion
Other Accounts | 285 | $83.15 billion | 12 | $6.61 billion
Christopher Kilpatrick ‡ | Other Registered Investment Companies | 11 | $4.38 billion | None | None
Other Pooled Vehicles | 7 | $564 million | 3 | $386 million
Other Accounts | 13 | $860 million | None | None
Walter Kilcullen‡ | Other Registered Investment Companies | 8 | $2.83 billion | None | None
Other Pooled Vehicles | 14 | $6.53 billion | 3 | $386 million
Other Accounts | 11 | $1.70 billion | None | None

‡ The numbers above reflect the overall number of portfolios managed by employees of Western Asset Management Company (“Western Asset”). They are involved in the management of all the Firm’s portfolios, but they are not solely responsible for particular portfolios. Western Asset’s investment discipline emphasizes a team approach that combines the efforts of groups of specialists working in different market sectors. They are responsible for overseeing implementation of Western Asset’s overall investment ideas and coordinating the work of the various sector teams. This structure ensures that client portfolios benefit from a consensus that draws on the expertise of all team members.

(a)(3): Portfolio Manager Compensation (As of September 30, 2025):

Investment Professional Compensation

Conflicts of Interest

The Subadviser has adopted compliance policies and procedures to address a wide range of potential conflicts of interest that could directly impact client portfolios. For example, potential conflicts of interest may arise in connection with the management of multiple portfolios (including portfolios managed in a personal capacity). These could include potential conflicts of interest related to the knowledge and timing of a portfolio’s trades, investment opportunities and broker selection. Portfolio managers are privy to the size, timing, and possible market impact of a portfolio’s trades.

It is possible that an investment opportunity may be suitable for both a portfolio and other accounts managed by a portfolio manager, but may not be available in sufficient quantities for both the portfolio and the other accounts to participate fully. Similarly, there may be limited opportunity to sell an investment held by a portfolio and another account. A conflict may arise where the portfolio manager may have an incentive to treat an account preferentially as compared to a portfolio because the account pays a performance-based fee or the portfolio manager, the Subadviser or an affiliate has an interest in the account. The Subadviser has adopted procedures for allocation of portfolio transactions and investment opportunities across multiple client accounts on a fair and equitable basis over time. Eligible accounts that can participate in a trade generally share the same price on a pro-rata allocation basis, taking into account differences based on factors such as cash availability, investment restrictions and guidelines, and portfolio composition versus strategy.

With respect to securities transactions, the Subadviser determines which broker or dealer to use to execute each order, consistent with their duty to seek best execution of the transaction. However, with respect to certain other accounts (such as pooled investment vehicles that are not registered investment companies and other accounts managed for organizations and individuals), the Subadviser may be limited by the client with respect to the selection of brokers or dealers or may be instructed to direct trades through a particular broker or dealer. In these cases, trades for a portfolio in a particular security may be placed separately from, rather than aggregated with, such other accounts. Having separate transactions with respect to a security may temporarily affect the market price of the security or the execution of the transaction, or both, to the possible detriment of a portfolio or the other account(s) involved. Additionally, the management of multiple portfolios and/or other accounts may result in a portfolio manager devoting unequal time and attention to the management of each portfolio and/or other account. The Subadviser’s team approach to portfolio management and block trading approach seeks to limit this potential risk.

The Subadviser also maintains a gift and entertainment policy to address the potential for a business contact to give gifts or host entertainment events that may influence the business judgment of an employee. Employees are permitted to retain gifts of only a nominal value and are required to make reimbursement for entertainment events above a certain value. All gifts (except those of a de minimis value) and entertainment events that are given or sponsored by a business contact are required to be reported in a gift and entertainment log which is reviewed on a regular basis for possible issues.

Employees of the Subadviser have access to transactions and holdings information regarding client accounts and the Subadviser’s overall trading activities. This information represents a potential conflict of interest because employees may take advantage of this information as they trade in their personal accounts. Accordingly, the Subadviser maintains a Code of Ethics that is compliant with Rule 17j-1 under the 1940 Act and Rule 204A-1 under the Advisers Act to address personal trading. In addition, the Code of Ethics seeks to establish broader principles of good conduct and fiduciary responsibility in all aspects of the Subadviser’s business. The Code of Ethics is administered by the Legal and Compliance Department and monitored through the Subadviser’s compliance monitoring program.

The Subadviser may also face other potential conflicts of interest with respect to managing client assets, and the description above is not a complete description of every conflict of interest that could be deemed to exist. The Subadviser also maintains a compliance monitoring program and engages independent auditors to conduct a SOC1/ISAE 3402 audit on an annual basis. These steps help to ensure that potential conflicts of interest have been addressed.

Investment Professional Compensation

With respect to the compensation of the Fund’s investment professionals, the Subadviser’s compensation system assigns each employee a total compensation range, which is derived from annual market surveys that benchmark each role with its job function and peer universe. This method is designed to reward employees with total compensation reflective of the external market value of their skills, experience and ability to produce desired results. Standard compensation includes competitive base salaries, generous employee benefits and a retirement plan.

In addition, the Subadviser’s employees are eligible for bonuses. These are structured to closely align the interests of employees with those of the Subadviser, and are determined by the professional’s job function and pre-tax performance as measured by a formal review process. All bonuses are completely discretionary. The principal factor considered is an investment professional’s investment performance versus appropriate peer groups and benchmarks (e.g., a securities index and with respect to the Fund, the benchmark set forth in the Fund’s Prospectus to which the Fund’s average annual total returns are compared or, if none, the benchmark set forth in the Fund’s annual report). Performance is reviewed on a 1, 3 and 5 year basis for compensation—with 3 and 5 years having a larger emphasis. The Subadviser may also measure an investment professional’s pre-tax investment performance against other benchmarks, as it determines appropriate. Because investment professionals are generally responsible for multiple accounts (including the Fund) with similar investment strategies, they are generally compensated on the performance of the aggregate group of similar accounts, rather than a specific account. Other factors that may be considered when making bonus decisions include client service, business development, length of service to the Subadviser, management or supervisory responsibilities, contributions to developing business strategy and overall contributions to the Subadviser’s business.

Finally, in order to attract and retain top talent, all investment professionals are eligible for additional incentives in recognition of outstanding performance. These are determined based upon the factors described above and include long-term incentives that vest over a set period of time past the award date.

Investment Professional Securities Ownership

The table below identifies the dollar range of securities beneficially owned by the named investment professional as of September 30, 2025.

Investment Professional(s) |  | Dollar Range of Portfolio Securities Beneficially Owned
Michael C. Buchanan |  | A
Christopher F. Kilpatrick |  | A
Walter Kilcullen |  | A

Dollar Range ownership is as follows:
A: none
B: $1 - $10,000
C: 10,001 - $50,000
D: $50,001 - $100,000
E: $100,001 - $500,000
F: $500,001 - $1 million
G: over $1 million

| ITEM 14. | PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS.

Not applicable.

| ITEM 15. | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

There have been no changes to the procedures by which shareholders may recommend nominees to the Registrant’s Board of Trustees that would require disclosure herein.

| ITEM 16. | CONTROLS AND PROCEDURES.

| (a) | The Registrant’s principal executive officer and principal financial officer have concluded that the Registrant’s disclosure controls and procedures (as defined in Rule 30a- 3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of the disclosure controls and procedures required by Rule 30a-3(b) under the 1940 Act and 15d-15(b) under the Securities Exchange Act of 1934.

| (b) | There were no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the period covered by this report that have materially affected or are likely to materially affect the Registrant’s internal control over financial reporting.

| ITEM 17. | DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

| ITEM 18. | RECOVERY OF ERRONEOUSLY AWARDED COMPENSATION.

| (a) | Not applicable.

| (b) | Not applicable.

| ITEM 19. | EXHIBITS.

(a) (1) Code of Ethics attached hereto.

Exhibit 99.CODE ETH

(a) (3) Certifications pursuant to section 302 of the Sarbanes-Oxley Act of 2002 attached hereto.

Exhibit 99.CERT

(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 attached hereto.

Exhibit 99.906CERT

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this Report to be signed on its behalf by the undersigned, there unto duly authorized.

Western Asset High Income Opportunity Fund Inc.

By: | /s/ Jane Trust |
| Jane Trust |
| Chief Executive Officer |
Date: | November 25, 2025 |

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By: | /s/ Jane Trust |
| Jane Trust |
| Chief Executive Officer |
Date: | November 25, 2025 |

By: | /s/ Christopher Berarducci |
| Christopher Berarducci |
| Principal Financial Officer |
Date: | November 25, 2025 |