FS Energy & Power Fund (FSEP) is a business development company (BDC) designed to provide a combination of income and growth. The Fund primarily invests in the income-oriented debt and equity securities of private U.S. energy and power companies.

Investment objectives

FSEP is a publicly registered, non-traded BDC and opened to new investors in July 2011. A BDC allows individual investors, at low investment minimums, to invest in the same type of private companies as do large institutions, endowments and wealthy individuals. FSEP’s investment objectives are to generate current income and capital appreciation. 

 

Investment strategy

The Fund seeks to diversify its portfolio holdings across a diverse set of energy sub-sectors and geographic locations with a focus on investing in U.S. energy and power companies with:

  • Deeply-rooted asset value
  • Defensible market positions
  • Proven management teams
  • Commodity price management
  • Viable exit strategy
While diversification and asset allocation alone cannot guarantee a profit nor eliminate the potential loss of principal, this flexibility may help the Fund provide investors with income and growth, while maintaining a focus on capital preservation.

Note: To invest in FSEP, an investor is required to have either: (i) a net worth (not including home, furnishings and personal automobiles) of at least $70,000 and an annual gross income of at least $70,000, or (ii) a net worth (not including home, furnishings and personal automobiles) of at least $250,000. Some states, including, but not limited to, Alabama, Idaho, Iowa, Kansas, Kentucky, Maine, Massachusetts, Nebraska, North Dakota, Ohio, Oklahoma, Oregon and Tennessee, impose heightened suitability standards.

*The public offering price is subject to a sales load of up to 10.0% of the public offering price per share (consisting of selling commissions of up to 7.0% and dealer manager fees of up to 3.0% of the public offering price per share) and offering expenses of up to 1.5% of the gross proceeds raised in the public offering, after payment of selling commissions and dealer manager fees. The public offering price is subject to change.

**The annualized distribution rate is expressed as a percentage equal to the projected annualized distribution amount per share (which is calculated by annualizing the regular weekly cash distribution per share as of the date indicated above without compounding), divided by the public offering price per share as of the date indicated above. The annualized distribution rate shown may be rounded. FSEP’s previous distributions to shareholders were funded in significant part by the reimbursement of certain expenses, including through the waiver of certain investment advisory fees, that are subject to repayment to its affiliate, Franklin Square Holdings, and its future distributions may be funded from such waivers and reimbursements. Significant portions of these distributions were not based on FSEP’s investment performance and such waivers and reimbursements by Franklin Square Holdings may not continue in the future. See FSEP’s filings with the SEC for additional information.

Corporate Governance

FS2 Capital Partners, LLC | 201 Rouse Boulevard | Philadelphia, PA 19112
877-372-9880 | Member FINRA/SIPC

© 2015 FS Energy and Power Fund