FS Global Credit Opportunities Fund—ADV

FSGCO—ADV

Fund:

FSGCO—A and FSGCO—D are closed to new investors. FSGCO—T and FSGCO—ADV are available for purchase through financial advisors, however, FSGCO—ADV is only for use with advisory accounts. Consult with your financial advisor for more information.

Investment objectives

Generate an attractive total return with a secondary objective of capital preservation

Overview

FSGCO is an unlisted, closed-end fund. The fund invests primarily in global corporate credit, including loans, bonds and other credit instruments that companies use to finance their operations.

Adviser

FS Global Advisor, LLC
An affiliate of FS Investments

Sub-adviser

GSO Capital Partners LP
The credit platform of Blackstone


Pricing

Public offering price 1 (as of 5/24/2017) $8.02
Net asset value 2 (as of 5/24/2017) $8.02
Annualized distribution rate 3 (based on public offering price) 8.28%
Annualized distribution amount 3 (as of 5/24/2017) $0.66


View Pricing Disclosure For Footnotes 123
1FSGCO–ADV’s common shares are subject to offering costs of up to 1.00% of the aggregate proceeds raised in FSGCO–ADV’s continuous public offering and an annual distribution fee of 0.67% of the net asset value (NAV) of the common shares. See FSGCO–ADV’s prospectus for additional information regarding applicable fees and expenses.
2FSGCO–ADV’s NAV per common share as of the date indicated is the NAV determined by FSGCO–ADV for purposes of complying with the requirements of Section 23(b) of the Investment Company Act of 1940, as amended, and has not been approved by FSGCO–ADV’s board of trustees. FSGCO–ADV’s NAV per common share may increase or decrease in the future, and any such change may be material.
3The annualized distribution rate shown 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, without compounding), divided by FSGCO–ADV’s public offering price per share as of the date indicated. The annualized distribution rate shown may be rounded. The payment of future distributions on FSGCO–ADV’s common shares is subject to the discretion of FSGCO–ADV’s board of trustees and applicable legal restrictions and, therefore, there can be no assurance as to the amount or timing of any such future distributions.

Performance – returns


Shareholder returns 1
Compounded monthly
YTD
2.9%
1 year
––
3 years
Annualized
––
5 years
Annualized
––
Since inception
Annualized
––
Cumulative total return
Since inception
17.7%
Cumulative cash distributions per share 2
Since inception
$0.54
Inception date
7/6/2016
As of 4/30/2017, unless otherwise noted. Numbers may be rounded.
Returns shown are historical only and are based on past performance. Past performance is not a guarantee of future results.
View Returns disclosure For Footnotes 12
1Shareholder Returns are the total returns an investor received for the highlighted period taking into account all distributions paid during such period, compounded monthly. The calculation assumes that the investor purchased shares at FSGCO—ADV’s public offering price at the beginning of the applicable period and reinvested all cash distributions pursuant to FSGCO—ADV’s distribution reinvestment plan (“DRP”). Valuation as of the end of each period is the repurchase price pursuant to FSGCO— ADV’s share repurchase program on such date. Upon liquidation or repurchase, market conditions may cause the actual values to be more or less than the values shown.

FSGCO–ADV’s total operating expenses as a percentage of average net assets was 1.48% for the period from July 6, 2016 (commencement of operations) to December 31, 2016. Shareholders of FSGCO-ADV indirectly bear the expenses of the Fund, as FSGCO-ADV’s assets are invested in the Fund. The Fund’s total operating expenses as a percentage of average net assets was 4.61% for the year ended December 31, 2016. See FSGCO—ADV’s prospectus for additional information regarding applicable fees and expenses.
2Cumulative cash distributions per share reflect the total regular cash distributions paid since inception on a per share basis as of April 30, 2017. The payment of future distributions on FSGCO—ADV’s shares is subject to the discretion of FSGCO— ADV’s board of trustees and applicable legal restrictions and, therefore, there can be no assurance as to the amount or timing of any such future distributions.

Portfolio composition1

View Portfolio disclosure For Footnotes 1
1As of 12/31/2016. Calculated as a percentage of fair value. Fair value is determined by FS Global Credit Opportunities Fund’s (FSGCO) board of trustees. Investments listed are held by FSGCO. Investments in FSGCO are made indirectly through FSGCO–A, FSGCO–D, FSGCO–T and FSGCO–ADV.

Key facts*

Inception date 7/6/2016
Registered shares 1 30 million
Total AUM 2 $1.97 billion
Number of portfolio companies 91
Sponsor commitment (as of 2/21/2017) 3 $56.32 million
Floating rate assets 4 38% of portfolio
Distribution frequency 5 Monthly
Liquidity 6 Quarterly tender offers
Tax reporting Form 1099-DIV
*As of 12/31/2016 unless otherwise noted.
View key facts disclosure for Footnotes 123456
1Registered shares means the shares registered on the registration statement relating to FSGCO–ADV’s initial public offering that was initially declared effective by the SEC on April 28, 2016, as amended.
2Total AUM represents the total assets of FSGCO. Investments in FSGCO are made indirectly through FSGCO–A, FSGCO–D, FSGCO–T and FSGCO–ADV.
3Sponsor commitment means the aggregate investments in FSGCO–ADV, FSGCO–A, FSGCO–D and FSGCO–T made by investors affiliated with FS Global Advisor, LLC and GSO Capital Partners LP, including members of FSGCO–ADV’s board of trustees.
4Calculated as a percentage of fair value. Fair value is determined by FSGCO’s board of trustees.
5The payment of distributions on FSGCO–ADV’s common shares is subject to the discretion of FSGCO–ADV’s board of trustees and applicable legal restrictions and, therefore, there can be no assurance as to the amount or timing of any such distributions.
6FSGCO–ADV intends to repurchase a limited number of shares pursuant to its share repurchase program. FSGCO–ADV may amend, suspend or terminate its share repurchase program at any time. FSGCO–ADV will offer to repurchase common shares at a price equal to NAV per common share in effect on each date of repurchase. See FSGCO–ADV’s prospectus for additional information regarding the share repurchase program.
View risk factors disclosure

Investments in FSGCO are made indirectly through FSGCO–ADV, which invests substantially all of the net proceeds from its public offering in common shares of FSGCO. FSGCO is a separate non-diversified, closed-end management investment company that carries out the investment strategies generally described herein. An investment in FSGCO–ADV involves a high degree of risk and may be considered speculative. The following are some of the risks an investment in FSGCO–ADV’s common shares involves; however, investors should carefully consider all of the risks discussed in FSGCO–ADV’s prospectus, including the risk factors set forth under the heading entitled “Types of Investments and Related Risks,” before deciding to invest in FSGCO–ADV’s common shares.

  • An investment in common shares is not suitable for an investor if they need access to the money they invest.
  • Shareholders should consider that they may not have access to the money they invest for an indefinite period of time.
  • Unlike an investor in most closed-end funds, FSGCO–ADV’s shareholders should not expect to be able to sell their common shares regardless of how FSGCO–ADV performs.
  • If a shareholder is able to sell their common shares, the shareholder will likely receive less than their purchase price and the then-current NAV per common share.
  • Investors in FSGCO–ADV’s common shares are subject to an annual distribution fee of 0.67% of the NAV of the shares, which will begin to accrue on the first day of the first full calendar
    month following the final weekly closing in FSGCO–ADV’s offering.
  • Unlike most closed-end funds, FSGCO–ADV’s common shares are not listed on any securities exchange, and FSGCO–ADV will not seek to complete a liquidity event for at least seven years following December 12, 2013, the date on which FSGCO commenced investment operations. The distribution fee will terminate for all shareholders upon the occurrence of a liquidity event. As such, there may be a conflict of interest relating to the timing with which FS Global Advisor, LLC seeks to complete a liquidity event for shareholders.
  • To provide shareholders with limited liquidity, FSGCO–ADV intends to conduct quarterly repurchases of shares. Although FSGCO–ADV has implemented a share repurchase program, it may be discontinued at any time and only a limited number of shares are eligible for repurchase. FSGCO–ADV currently intends to limit the number of shares to be repurchased during any calendar year to the number of shares FSGCO–ADV can repurchase with the proceeds it receives from the issuance of shares under its distribution reinvestment plan and the sale of shares at the two weekly closings occurring immediately prior to each date of repurchase. In addition, FSGCO–ADV will limit the number of shares to be repurchased in any calendar year to 20% of the weighted average number of shares outstanding in the prior calendar year, or 5% in each quarter, though the actual number of shares that FSGCO–ADV offers to repurchase may be less in light of the limitations noted above. 
  • FSGCO–ADV’s distributions may be funded from unlimited amounts of offering proceeds or borrowings, which may constitute a return of capital and reduce the amount of capital available to FSGCO–ADV for investment. Any capital returned to shareholders through distributions will be distributed after payment of fees and expenses.
  • FSGCO–ADV’s and FSGCO’s previous distributions to shareholders were funded in significant part from the reimbursement of certain expenses, including through the waiver of certain investment advisory fees, and additional support payments that may be subject to repayment to FSGCO–ADV’s and FSGCO’s affiliate, FS Investments, and FSGCO–ADV’s and FSGCO’s future distributions may be funded from such waivers, reimbursements or payments. Significant portions of these distributions were not based on FSGCO’s investment performance and such waivers, reimbursements and payments by FS Investments may not continue in the future. If FS Investments had not agreed to reimburse certain of FSGCO–ADV’s and FSGCO’s expenses, including through the waiver of certain advisory fees payable by FSGCO, and make additional support payments, significant portions of FSGCO–ADV’s and FSGCO’s distributions would have come from offering proceeds or borrowings. The repayment of any amounts owed to FS Investments will reduce the future distributions to which shareholders would otherwise be entitled.
  • Even if FSGCO does eventually list its shares, shares of closed-end funds frequently trade at a discount to NAV, and this creates a risk of loss for investors who purchase shares at the offering price. This risk is separate and distinct from the risk that FSGCO–ADV’s NAV will decrease.
  • FSGCO’s investments in securities and other obligations of companies that are experiencing distress involve a substantial degree of risk, require a high level of analytical sophistication for successful investment and require active monitoring.
  • FSGCO’s investments in various types of debt securities and instruments may be secured, unsecured, rated or unrated, are subject to non-payment risk, and may be speculative in nature. 
  • Below investment grade instruments (commonly referred to as “high yield” securities or “junk bonds”) may be particularly susceptible to economic downturns, which could cause losses. 
  • FSGCO may invest in illiquid and restricted securities that may be difficult to dispose of at a fair price.
  • FSGCO’s use of leverage could result in special risks for FSGCO’s shareholders, including FSGCO–ADV, and can magnify the effect of any losses.
  • Investments in certain securities or other instruments of non-U.S. issuers or borrowers may involve factors not typically associated with investing in the United States or other developed
    countries.
  • Securities or other instruments of non-U.S. securities may be traded in underdeveloped, inefficient and less liquid markets and may experience greater price volatility, illiquidity and changes in value.
  • FS Global Advisor, LLC, GSO Capital Partners LP and certain of their affiliates may experience conflicts of interest in connection with the management of FSGCO.
  • FSGCO–ADV and FSGCO have limited operating histories and are subject to the business risks and uncertainties associated with any new business.

  • FSGCO seeks to achieve its investment objectives by focusing on a limited number of opportunities across the investment universe.
  • The public offering by FSGCO–ADV is being made on a “best efforts” basis. To the extent that less than the maximum number of common shares is subscribed for, the opportunity for the allocation of FSGCO’s investments among various issuers and industries may be decreased, and the returns achieved on those investments may be reduced as a result of allocating all of FSGCO’s expenses over a smaller capital base.




To invest in FSGCO–ADV, an investor must 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. Please consult the prospectus for a detailed description of the suitability standards imposed on investors.

Corporate governance


FSGCO Q1 2017 quarterly shareholder call

FS Investment Solutions, LLC | 201 Rouse Boulevard | Philadelphia, PA 19112

877-372-9880 | Member FINRA/SIPC

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