UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

o

Rule 13d-1(b)

x

Rule 13d-1(c)

o

Rule 13d-1(d)

CUSIP No. 430893107

1.

Name of Reporting Person
Keefe Ventures Fund II, L.P.
I.R.S. Identification No. of Above Person (Entities Only)
46-2785453

2.

Check the Appropriate Box if a Member of a Group

(a)

o

(b)

o

3.

SEC Use Only

4.

Citizenship or Place of Organization
Delaware

Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With

5.

Sole Voting Power
0

6.

Shared Voting Power
407,033

7.

Sole Dispositive Power
0

8.

Shared Dispositive Power
407,033

9.

Aggregate Amount Beneficially Owned by Each Reporting Person
407,033

10.

Check Box if the Aggregate Amount in Row (9) Excludes Certain Shares  o

11.

Percent of Class Represented by Amount in Row (9)
5.3%*

12.

Type of Reporting Person
PN

CUSIP No. 430893107

1.

Name of Reporting Person
Keefe Ventures II, LLC
I.R.S. Identification No. of Above Person (Entities Only)
46-2785601

2.

Check the Appropriate Box if a Member of a Group

(a)

o

(b)

o

3.

SEC Use Only

4.

Citizenship or Place of Organization
Delaware

Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With

5.

Sole Voting Power
0

6.

Shared Voting Power
407,033

7.

Sole Dispositive Power
0

8.

Shared Dispositive Power
407,033

9.

Aggregate Amount Beneficially Owned by Each Reporting Person
407,033

10.

Check Box if the Aggregate Amount in Row (9) Excludes Certain Shares  o

11.

Percent of Class Represented by Amount in Row (9)
5.3%*

12.

Type of Reporting Person
OO

CUSIP No. 430893107

1.

Name of Reporting Person
John J. Lyons

2.

Check the Appropriate Box if a Member of a Group

(a)

o

(b)

o

3.

SEC Use Only

4.

Citizenship or Place of Organization
United States

Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With

5.

Sole Voting Power
0

6.

Shared Voting Power
407,033

7.

Sole Dispositive Power
0

8.

Shared Dispositive Power
407,033

9.

Aggregate Amount Beneficially Owned by Each Reporting Person
407,033

10.

Check Box if the Aggregate Amount in Row (9) Excludes Certain Shares  o

11.

Percent of Class Represented by Amount in Row (9)
5.3%*

12.

Type of Reporting Person
IN

CUSIP No. 430893107

1.

Name of Reporting Person
William Michael Kearns, Jr.

2.

Check the Appropriate Box if a Member of a Group

(a)

o

(b)

o

3.

SEC Use Only

4.

Citizenship or Place of Organization
United States

Number of
Shares
Beneficially
Owned by
Each
Reporting
Person With

5.

Sole Voting Power
0

6.

Shared Voting Power
407,033

7.

Sole Dispositive Power
0

8.

Shared Dispositive Power
407,033

9.

Aggregate Amount Beneficially Owned by Each Reporting Person
407,033

10.

Check Box if the Aggregate Amount in Row (9) Excludes Certain Shares  o

11.

Percent of Class Represented by Amount in Row (9)
5.3%*

12.

Type of Reporting Person
IN

CUSIP No. 430893107

Item 1(a)

Name of Issuer:
The name of the issuer is Highlands Bankshares, Inc., a Virginia corporation (the “Issuer”).

Item 1(b)

Address of Issuer’s Principal Executive Offices:
The Issuer’s principal executive offices are located at P.O. Box 1128, Abingdon, Virginia 24212-1128.

Item 2(a)

Name of Person Filing:
This statement is filed by:

(i)                                     Keefe Ventures Fund II, L.P., a limited partnership organized under the laws of the State of Delaware (the “Fund”), with respect to the shares of Common Stock (as defined below) directly owned by it;

(ii)                                  Keefe Ventures II, LLC, a limited liability company organized under the laws of the State of Delaware (the “General Partner”), as general partner of the Fund, with respect to the shares of Common Stock directly owned by the Fund;

(iii)                               John J. Lyons, as President and Manager of the General Partner, with respect to the shares of Common Stock directly owned by the Fund (“Mr. Lyons”); and

(iv)                              William Michael Kearns, Jr., as Chairman and Manager of the General Partner, with respect to the shares of Common Stock directly owned by the Fund (“Mr. Kearns” and, together with Mr. Lyons, the Fund and the General Partner, the “Reporting Persons”).

Item 2(b)

Address of Principal Business Office or, if none, Residence:
The address of the business office of each of the Reporting Persons is 310 South Street, Morristown, New Jersey 07960.

Item 2(c)

Citizenship:
The Fund is a limited partnership organized under the laws of the State of Delaware.  The General Partner is a limited liability company organized under the laws of the State of Delaware.  Each of Mr. Lyons and Mr. Kearns is a citizen of the United States.

Item 2(d)

Title of Class of Securities:
Common Stock, $0.625 par value (“Common Stock”).

Item 2(e)

CUSIP No.:
430893107.

Item 3

If this statement is filed pursuant to §§ 240.13d-1(b) or 240.13d-2(b) or (c), check whether the person filing is a:

(a)

o

Broker or dealer registered under section 15 of the Act (15 U.S.C. 78o);

(b)

o

Bank as defined in section 3(a)(6) of the Act (15 U.S.C. 78c);

(c)

o

Insurance company as defined in section 3(a)(19) of the Act (15 U.S.C. 78c);

(d)

o

Investment company registered under section 8 of the Investment Company Act of 1940 (15 U.S.C 80a-8);

(e)

o

An investment adviser in accordance with § 240.13d-1(b)(1)(ii)(E);

(f)

o

An employee benefit plan or endowment fund in accordance with § 240.13d-1(b)(1)(ii)(F);

(g)

o

A parent holding company or control person in accordance with § 240.13d-1(b)(1)(ii)(G);

(h)

o

A savings associations as defined in Section 3(b) of the Federal Deposit Insurance Act (12 U.S.C. 1813);

(i)

o

A church plan that is excluded from the definition of an investment company under section 3(c)(14) of the Investment Company Act of 1940 (15 U.S.C. 80a-3);

(j)

o

A non-U.S. institution in accordance with § 240.13d–1(b)(1)(ii)(J);

(k)

o

Group, in accordance with § 240.13d–1(b)(1)(ii)(K). If filing as a non-U.S. institution in accordance with

§ 240.13d–1(b)(1)(ii)(J), please specify the type of institution:____________________________

CUSIP No. 430893107

Item 4

Ownership:

Provide the following information regarding the aggregate number and percentage of the class of securities of the issuer identified in Item 1.

(a)

Amount beneficially owned:   

The Fund is the direct owner of the 407,033 shares of Common Stock reported in this Schedule 13G.  The Fund has the power to dispose of and the power to vote the shares of Common Stock beneficially owned by it, which power may be exercised by the General Partner, as general partner of the Fund.  Mr. Lyons is the President and Manager of the General Partner and Mr. Kearns is the Chairman and Manager of the General Partner.  Each of Mr. Lyons and Mr. Kearns has the power to exercise investment discretion on behalf of the General Partner.  None of the General Partner, Mr. Lyons or Mr. Kearns directly owns any shares of Common Stock.  By reason of the provisions of Rule 13d-3 of the Act, the General Partner, Mr. Lyons and Mr. Kearns may be deemed to beneficially own the shares of Common Stock owned by the Fund.  Each of the General Partner, Mr. Lyons and Mr. Kearns disclaims beneficial ownership of the shares of Common Stock owned by the Fund for all other purposes except to the extent of their pecuniary interest therein.

(b)

Percent of class:   

See Item 11 of each cover page.

(c)

Number of shares as to which the person has:

(i)

Sole power to vote or to direct the vote:  

See Item 5 of each cover page.

(ii)

Shared power to vote or to direct the vote:    

See Item 6 of each cover page.

(iii)

Sole power to dispose or to direct the disposition of:   

See Item 7 of each cover page.

(iv)

Shared power to dispose or to direct the disposition of:   

See Item 8 of each cover page.

Item 5

Ownership of Five Percent or Less of a Class:

If this statement is being filed to report the fact that as of the date hereof the reporting person has ceased to be the beneficial owner of more than 5 percent of the class of securities, check the following   o.

Item 6

Ownership of More than Five Percent on Behalf of Another Person:

Not Applicable.

Item 7

Identification and Classification of the Subsidiary Which Acquired the Security Being Reported on By the Parent Holding Company or Control Person:

Not Applicable.

Item 8

Identification and Classification of Members of the Group:

Not Applicable.

Item 9

Notice of Dissolution of Group:

Not Applicable.

CUSIP No. 430893107

Item 10

Certification:

Each of the Reporting Persons hereby makes the following certification:

By signing below the Reporting Person certifies that, to the best of his or its knowledge and belief, the securities referred to above were not acquired and are not held for the purpose of or with the effect of changing or influencing the control of the issuer of the securities and were not acquired and are not held in connection with or as a participant in any transaction having that purpose or effect.

KEEFE VENTURES FUND II, L.P.,

by Keefe Ventures II, LLC, its General Partner

By:

/s/ John J. Lyons

Name:

John J. Lyons

Title:

President

KEEFE VENTURES II, LLC

By:

/s/ John J. Lyons

Name:

John J. Lyons

Title:

President

By:

/s/ John J. Lyons

Name:

John J. Lyons, individually

By:

/s/ William Michael Kearns, Jr.

Name:

William Michael Kearns, Jr., individually

CUSIP No. 430893107

KEEFE VENTURES FUND II, L.P.,

by Keefe Ventures II, LLC, its General Partner

By:

/s/ John J. Lyons

Name:

John J. Lyons

Title:

President

KEEFE VENTURES II, LLC

By:

/s/ John J. Lyons

Name:

John J. Lyons

Title:

President

By:

/s/ John J. Lyons

Name:

John J. Lyons, individually

By:

/s/ William Michael Kearns, Jr.

Name:

William Michael Kearns, Jr., individually