FS Energy & Power Fund - FORM 10-Q

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TABLE OF CONTENTS

Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q


ý		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
		FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2016
o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

COMMISSION FILE NUMBER: 814-00841

FS Energy and Power Fund
(Exact name of registrant as specified in its charter)


Delaware (State or other jurisdiction of incorporation or organization)		27-6822130 (I.R.S. Employer Identification No.)
201 Rouse Boulevard Philadelphia, Pennsylvania (Address of principal executive office)		19112 (Zip Code)

Registrant's telephone number, including area code: (215) 495-1150

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o.

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes o No o.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer o		Accelerated filer o		Non-accelerated filer ý (Do not check if a smaller reporting company)		Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No ý.

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

The issuer had 430,438,096 common shares of beneficial interest outstanding as of October 25, 2016.

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TABLE OF CONTENTS



PART I—FINANCIAL INFORMATION
ITEM 1.	FINANCIAL STATEMENTS
	Consolidated Balance Sheets as of September 30, 2016 (Unaudited) and December 31, 2015	1
	Unaudited Consolidated Statements of Operations for the three and nine months ended September 30, 2016 and 2015	2
	Unaudited Consolidated Statements of Changes in Net Assets for the nine months ended September 30, 2016 and 2015	3
	Unaudited Consolidated Statements of Cash Flows for the nine months ended September 30, 2016 and 2015	4
	Consolidated Schedules of Investments as of September 30, 2016 (Unaudited) and December 31, 2015	5
	Notes to Unaudited Consolidated Financial Statements	19
ITEM 2.	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	54
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	78
ITEM 4.	CONTROLS AND PROCEDURES	79
PART II—OTHER INFORMATION
ITEM 1.	LEGAL PROCEEDINGS	80
ITEM 1A.	RISK FACTORS	80
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	80
ITEM 3.	DEFAULTS UPON SENIOR SECURITIES	80
ITEM 4.	MINE SAFETY DISCLOSURES	80
ITEM 5.	OTHER INFORMATION	80
ITEM 6.	EXHIBITS	81
	SIGNATURES	87

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PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

FS Energy and Power Fund

Consolidated Balance Sheets
(in thousands, except share and per share amounts)

	September 30, 2016 (Unaudited)			December 31, 2015

Assets
Investments, at fair value
Non-controlled/unaffiliated investments (amortized cost—$3,258,182 and $3,267,830, respectively)	$	2,977,197		$	2,518,595
Non-controlled/affiliated investments (amortized cost—$702,648 and $356,188, respectively)		770,227			276,993
Controlled/affiliated investments (amortized cost—$26,539 and $270,389, respectively)		252			273,910

Total investments, at fair value (amortized cost—$3,987,369 and $3,894,407, respectively)		3,747,676			3,069,498
Cash		271,317			368,867
Receivable for investments sold and repaid		295			13,792
Interest receivable		48,981			34,921
Receivable for common shares purchased		—			6,915
Deferred financing costs		3,195			3,865
Deferred offering costs		2,222			—
Prepaid expenses and other assets		67			247

Total assets	$	4,073,753		$	3,498,105

Liabilities
Payable for investments purchased	$	8,075		$	—
Credit facilities payable (net of deferred financing costs of $1,113 and $1,094, respectively)		538,759			714,416
Repurchase agreement payable (net of deferred financing costs of $123 and $220, respectively)⁽¹⁾		324,877			324,764
Shareholder distributions payable		28			48
Management fees payable		20,086			18,338
Subordinated income incentive fees payable⁽²⁾		—			12,048
Administrative services expense payable		1,556			1,872
Interest payable		3,824			3,046
Trustees' fees payable		245			254
Other accrued expenses and liabilities		4,504			5,458

Total liabilities		901,954			1,080,244

Commitments and contingencies⁽³⁾
Shareholders' equity
Preferred shares, $0.001 par value, 50,000,000 shares authorized, none issued and outstanding		—			—
Common shares, $0.001 par value, 450,000,000 shares authorized, 431,453,607 and 372,210,264 shares issued and outstanding, respectively		431			372
Capital in excess of par value		3,830,129			3,428,672
Accumulated undistributed net realized gains (losses) on investments and gain/loss on foreign currency⁽⁴⁾		(396,184	)		(200,220	)
Accumulated undistributed (distributions in excess of) net investment income⁽⁴⁾		(22,818	)		14,024
Net unrealized appreciation (depreciation) on investments and unrealized gain/loss on foreign currency		(239,759	)		(824,987	)

Total shareholders' equity		3,171,799			2,417,861

Total liabilities and shareholders' equity	$	4,073,753		$	3,498,105

Net asset value per common share at period end	$	7.35		$	6.50

(1): See Note 8 for a discussion of the Company's repurchase transaction.
(2): See Note 2 and Note 4 for a discussion of the methodology employed by the Company in calculating the subordinated income incentive fees.
(3): See Note 9 for a discussion of the Company's commitments and contingencies.
(4): See Note 5 for a discussion of the sources of distributions paid by the Company.

See notes to unaudited consolidated financial statements.

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FS Energy and Power Fund

Unaudited Consolidated Statements of Operations
(in thousands, except share and per share amounts)

	Three Months Ended September 30,						Nine Months Ended September 30,

	2016			2015			2016			2015
Investment income
From non-controlled/unaffiliated investments:
Interest income	$	75,293		$	82,469		$	225,944		$	237,077
Fee income		2,624			10,096			5,251			23,741
From non-controlled/affiliated investments:
Interest income		11,465			5,512			37,067			15,256
Fee income		—			681			7,356			681

Total investment income		89,382			98,758			275,618			276,755

Operating expenses
Management fees		20,086			19,522			55,725			57,659
Subordinated income incentive fees⁽¹⁾		—			9,611			5,774			18,968
Administrative services expenses		1,118			892			2,885			3,153
Share transfer agent fees		750			767			2,134			2,199
Accounting and administrative fees		384			361			994			1,082
Interest expense		8,921			7,627			27,200			22,351
Trustees' fees		245			246			757			736
Offering costs		755			—			1,378			—
Other general and administrative expenses		1,370			1,020			3,523			3,348

Total operating expenses		33,629			40,046			100,370			109,496
Income taxes		22			76			101			234

Total expenses		33,651			40,122			100,471			109,730

Net investment income		55,731			58,636			175,147			167,025

Realized and unrealized gain/loss
Net realized gain (loss) on investments:
Non-controlled/unaffiliated		(118,187	)		(100,813	)		(196,536	)		(159,323	)
Non-controlled/affiliated		(1,699	)		—			572			—
Net realized gain (loss) on foreign currency		—			(63	)		—			(210	)
Net change in unrealized appreciation (depreciation) on investments:
Non-controlled/unaffiliated		194,873			(226,650	)		454,465			(165,859	)
Non-controlled/affiliated		19,447			(13,133	)		147,788			(5,534	)
Controlled/affiliated		(3,837	)		—			(17,037	)		—
Net change in unrealized gain (loss) on foreign currency		(2	)		59			12			(82	)

Total net realized and unrealized gain (loss) on investments		90,595			(340,600	)		389,264			(331,008	)

Net increase (decrease) in net assets resulting from operations	$	146,326		$	(281,964	)	$	564,411		$	(163,983	)



Per share information—basic and diluted
Net increase (decrease) in net assets resulting from operations (Earnings per Share)	$	0.35		$	(0.81	)	$	1.41		$	(0.50	)



Weighted average shares outstanding		421,515,796			348,739,636			400,151,400			329,564,799

(1): See Note 2 and Note 4 for a discussion of the methodology employed by the Company in calculating the subordinated income incentive fees.

See notes to unaudited consolidated financial statements.

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FS Energy and Power Fund

Unaudited Consolidated Statements of Changes in Net Assets
(in thousands)

	Nine Months Ended September 30,

	2016			2015
Operations
Net investment income	$	175,147		$	167,025
Net realized gain (loss) on investments and foreign currency		(195,964	)		(159,533	)
Net change in unrealized appreciation (depreciation) on investments		585,216			(171,393	)
Net change in unrealized gain (loss) on foreign currency		12			(82	)

Net increase (decrease) in net assets resulting from operations		564,411			(163,983	)

Shareholder distributions⁽¹⁾
Distributions from net investment income		(211,989	)		(161,150	)
Distributions from net realized gain on investments		—			(13,591	)

Net decrease in net assets resulting from shareholder distributions		(211,989	)		(174,741	)

Capital share transactions
Issuance of common shares⁽²⁾		313,739			410,987
Reinvestment of shareholder distributions⁽²⁾		132,928			111,606
Repurchases of common shares⁽²⁾		(45,151	)		(18,659	)
Offering costs		—			(7,150	)

Net increase in net assets resulting from capital share transactions		401,516			496,784

Total increase (decrease) in net assets		753,938			158,060
Net assets at beginning of period		2,417,861			2,565,721

Net assets at end of period	$	3,171,799		$	2,723,781



Accumulated undistributed (distributions in excess of) net investment income⁽¹⁾	$	(22,818	)	$	10,216

(1): See Note 5 for a discussion of the sources of distributions paid by the Company.
(2): See Note 3 for a discussion of the Company's common share transactions.

See notes to unaudited consolidated financial statements.

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FS Energy and Power Fund

Unaudited Consolidated Statements of Cash Flows
(in thousands)

	Nine Months Ended September 30,

	2016			2015
Cash flows from operating activities
Net increase (decrease) in net assets resulting from operations	$	564,411		$	(163,983	)
Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by (used in) operating activities:
Purchases of investments		(679,004	)		(1,113,391	)
Paid-in-kind interest		(24,314	)		(19,292	)
Proceeds from sales and repayments of investments		425,906			622,847
Net realized (gain) loss on investments		195,964			159,323
Net change in unrealized (appreciation) depreciation on investments		(585,216	)		171,393
Accretion of discount		(11,514	)		(5,990	)
Amortization of deferred financing costs		2,355			1,954
Amortization of deferred offering costs		1,378			—
(Increase) decrease in receivable for investments sold and repaid		13,497			29,381
(Increase) decrease in interest receivable		(14,060	)		61
(Increase) decrease in prepaid expenses and other assets		180			(79	)
Increase (decrease) in payable for investments purchased		8,075			4,901
Increase (decrease) in management fees payable		1,748			1,610
Increase (decrease) in subordinated income incentive fees payable		(12,048	)		(2,531	)
Increase (decrease) in administrative services expense payable		(316	)		174
Increase (decrease) in interest payable⁽¹⁾		778			(586	)
Increase (decrease) in trustees' fees payable		(9	)		37
Increase (decrease) in other accrued expenses and liabilities		(954	)		1,070

Net cash provided by (used in) operating activities		(113,143	)		(313,101	)

Cash flows from financing activities
Issuance of common shares		320,654			415,103
Reinvestment of shareholder distributions		132,928			111,606
Repurchases of common shares		(45,151	)		(18,659	)
Offering costs incurred		(3,600	)		(7,150	)
Shareholder distributions		(212,009	)		(174,741	)
Borrowings under credit facilities		—			20,000
Borrowings under repurchase agreement		16			135,871
Repayments under credit facilities		(175,638	)		(197,287	)
Deferred financing costs paid		(1,607	)		(1,190	)

Net cash provided by financing activities		15,593			283,553

Total increase (decrease) in cash		(97,550	)		(29,548	)
Cash at beginning of period		368,867			225,130

Cash at end of period	$	271,317		$	195,582



Supplemental disclosure
Excise and state taxes paid	$	109		$	315



Non-cash purchases of investment	$	(309,593	)	$	—



Non-cash sales of investment	$	309,593		$	—

(1): See Note 8 for a discussion of the Company's credit facilities and repurchase transaction. During the nine months ended September 30, 2016 and 2015, the Company paid $15,751 and $14,101, respectively, in interest expense on the credit facilities. During the nine months ended September 30, 2016 and 2015, the Company paid $8,316 and $6,882, respectively, in interest expense pursuant to the repurchase agreement.

See notes to unaudited consolidated financial statements.

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FS Energy and Power Fund

Unaudited Consolidated Schedule of Investments
As of September 30, 2016
(in thousands, except share amounts)



Portfolio Company^(a)	Footnotes	Industry	Rate^(b)	Floor			Maturity	Principal Amount^(c)		Amortized Cost			Fair Value^(d)
Senior Secured Loans—First Lien—27.8%
Abaco Energy Technologies LLC	(g)(i)(j)	Service & Equipment	L+700, 2.5% PIK (2.5% Max PIK)		1.0	%	11/20/20	$	60,471	$	57,903		$	39,306
Allied Wireline Services, LLC	(g)(i)(k)(l)	Service & Equipment	L+400, 5.5% PIK (5.5% Max PIK)		1.5	%	2/28/19		107,426		106,525			103,398
Alon USA Partners, L.P.	(g)(i)(j)(m)(bb)	Downstream	L+800		1.3	%	11/26/18		11,092		11,243			11,064
Altus Power America, Inc.	(j)	Power	L+750		1.5	%	10/10/21		84,375		84,375			86,062
AP Exhaust Acquisition, LLC	(g)(l)	Service & Equipment	L+775		1.5	%	1/16/21		15,811		15,811			13,755
BL Sand Hills Unit, L.P.	(l)	Upstream	Prime+650		3.5	%	12/17/17		40,821		35,451			37,760
BL Sand Hills Unit, L.P.	(e)	Upstream	Prime+650		3.5	%	12/17/17		15,000		13,027			13,875
Brock Holdings III, Inc.	(f)	Service & Equipment	L+450		1.5	%	3/16/17		1,978		1,935			1,960
Cactus Wellhead, LLC	(g)(i)(j)	Service & Equipment	L+600		1.0	%	7/31/20		55,536		53,868			43,423
Cimarron Energy Inc.	(g)(bb)	Service & Equipment	L+775, 3.8% PIK (3.8% Max PIK)		1.0	%	12/15/19		24,724		24,724			24,847
CITGO Holding, Inc.	(f)	Downstream	L+850		1.0	%	5/12/18		16,865		17,010			17,099
Crestwood Holdings LLC	(f)(g)	Midstream	L+800		1.0	%	6/19/19		29,788		29,887			27,679
EnergySolutions, LLC	(i)(j)	Service & Equipment	L+575		1.0	%	5/29/20		18,193		17,951			18,170
Gulf Finance, LLC	(f)(i)	Midstream	L+525		1.0	%	8/25/23		19,000		18,434			18,531
Industrial Group Intermediate Holdings, LLC	(i)	Service & Equipment	L+800		1.3	%	5/31/20		22,262		22,262			22,596
Lusk Operating LLC	(r)(z)(aa)	Upstream	Prime+500 PIK (8.3% Max PIK)		3.3	%	10/31/16		26,831		25,539			899
Lusk Operating LLC	(e)(r)(z)(aa)	Upstream	Prime+500 PIK (8.3% Max PIK)		3.3	%	10/31/16		669		669			22
MB Precision Holdings LLC	(g)	Service & Equipment	L+725, 1.5% PIK (1.5% Max PIK)		1.3	%	1/23/20		12,838		12,838			12,260
Moxie Liberty LLC	(g)(j)	Power	L+650		1.0	%	8/21/20		32,236		32,328			31,833
P2 Upstream Acquisition Co.	(f)	Service & Equipment	L+400		1.0	%	10/30/20		5,114		4,797			4,797
Panda Temple Power, LLC	(j)	Power	L+625		1.0	%	3/6/22		9,850		9,695			8,865
Panda Temple Power II, LLC	(g)(j)	Power	L+600		1.3	%	4/3/19		27,601		27,853			25,737
ProPetro Services, Inc.	(i)	Service & Equipment	L+625		1.0	%	9/30/19		11,043		11,035			9,221
Stonewall Gas Gathering LLC	(j)(bb)	Midstream	L+775		1.0	%	1/28/22		16,470		16,051			16,841
Sunnova Asset Portfolio 5 Holdings, LLC	(j)(l)(p)	Power	12.0% PIK (12.0% Max PIK)				11/14/21		149,850		147,542			151,349
Swift Worldwide Resources US Holdings Corp.	(g)(j)	Service & Equipment	L+1100		1.0	%	7/20/21		58,762		58,762			56,705
UTEX Industries, Inc.	(f)	Service & Equipment	L+400		1.0	%	5/21/21		5,446		4,239			4,064
Warren Resources, Inc.	(k)(z)	Upstream	L+850		1.0	%	5/22/20		131,175		131,175			93,423

Total Senior Secured Loans—First Lien											992,929			895,541
Unfunded Loan Commitments											(13,696	)		(13,696	)

Net Senior Secured Loans—First Lien											979,233			881,845

See notes to unaudited consolidated financial statements.

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FS Energy and Power Fund

Unaudited Consolidated Schedule of Investments (Continued)
As of September 30, 2016
(in thousands, except share amounts)



Portfolio Company^(a)	Footnotes	Industry	Rate^(b)	Floor			Maturity	Principal Amount^(c)		Amortized Cost		Fair Value^(d)
Senior Secured Loans—Second Lien—29.0%
Alison US LLC	(f)(j)(m)	Service & Equipment	L+850		1.0	%	8/29/22	$	21,722	$	20,644	$	20,111
Ameriforge Group Inc.	(g)	Service & Equipment	L+750		1.3	%	12/21/20		35,950		36,373		5,752
AP Exhaust Acquisition, LLC		Service & Equipment	12.0% PIK (12.0% Max PIK)				9/28/21		3,654		3,654		3,014
Arena Energy, LP	(i)(k)	Upstream	L+900, 4.0% PIK (4.0% Max PIK)		1.0	%	1/24/21		102,375		102,375		101,925
Ascent Resources—Marcellus, LLC		Upstream	L+750		1.0	%	8/4/21		10,000		9,874		938
Ascent Resources—Utica, LLC	(g)(j)(k)(l)	Upstream	L+950, 2.0% PIK (2.0% Max PIK)		1.5	%	9/30/18		285,037		284,167		280,761
Brock Holdings III, Inc.	(g)(j)	Service & Equipment	L+825		1.8	%	3/16/18		29,605		29,717		28,125
Chief Exploration & Development LLC	(f)(i)	Upstream	L+650		1.3	%	5/16/21		36,576		35,075		34,473
Consolidated Precision Products Corp.	(g)(j)(bb)	Service & Equipment	L+775		1.0	%	4/30/21		14,074		13,820		12,772
Emerald Performance Materials, LLC	(f)(bb)	Downstream	L+675		1.0	%	8/1/22		11,819		11,752		11,819
Fieldwood Energy LLC		Upstream	L+713		1.3	%	9/30/20		41,047		41,830		16,555
Granite Intermediate Holdings, Inc.	(f)	Power	L+725		1.0	%	12/19/22		13,150		13,057		12,471
Gruden Acquisition, Inc.	(j)	Service & Equipment	L+850		1.0	%	8/18/23		15,000		14,349		11,611
Horn Intermediate Holdings, Inc.	(g)(j)	Service & Equipment	L+775		1.3	%	10/2/18		50,250		50,250		50,501
Jonah Energy LLC	(f)(i)(bb)	Upstream	L+650		1.0	%	5/12/21		29,293		28,594		26,218
Neff Rental LLC	(f)(j)	Service & Equipment	L+625		1.0	%	6/9/21		33,789		33,059		33,113
Oxbow Carbon LLC	(g)	Midstream	L+700		1.0	%	1/17/20		15,000		14,921		14,675
P2 Upstream Acquisition Co.	(f)(g)(j)	Service & Equipment	L+800		1.0	%	4/30/21		34,099		34,147		29,751
Titan Energy Operating, LLC	(i)(k)(p)	Upstream	2.0%, L+900 PIK (L+900 Max PIK)		1.0	%	2/23/20		101,814		83,387		84,322
Total Safety U.S., Inc.	(g)(j)	Service & Equipment	L+800		1.3	%	9/13/20		14,795		14,952		6,115
UTEX Industries, Inc.	(f)(j)	Service & Equipment	L+725		1.0	%	5/20/22		36,192		36,228		17,644
Vantage Energy, LLC	(i)(j)	Upstream	L+750		1.0	%	12/20/18		32,329		31,675		31,117
Vantage Energy II, LLC	(i)(j)(l)	Upstream	L+750		1.0	%	5/8/17		85,000		85,000		85,000

Total Senior Secured Loans—Second Lien											1,028,900		918,783

See notes to unaudited consolidated financial statements.

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FS Energy and Power Fund

Unaudited Consolidated Schedule of Investments (Continued)
As of September 30, 2016
(in thousands, except share amounts)



Portfolio Company^(a)	Footnotes	Industry	Rate^(b)	Floor	Maturity	Principal Amount^(c)		Amortized Cost		Fair Value^(d)
Senior Secured Bonds—11.4%
Calpine Corp.	(f)(m)	Power	5.3%		6/1/26	$	19,800	$	19,809	$	20,060
Cheniere Corpus Christi Holdings, LLC	(f)	Midstream	7.0%		6/30/24		4,000		4,136		4,328
CITGO Holding, Inc.	(f)	Downstream	10.8%		2/15/20		9,000		9,070		9,034
FourPoint Energy, LLC	(j)(k)(l)(p)	Upstream	9.0%		12/31/21		235,125		227,523		232,774
Lightstream Resources Ltd.	(k)(m)(r)(z)	Upstream	9.9%		6/15/19		62,400		62,400		55,848
Mirant Mid-Atlantic Trust	(f)(h)(o)	Power	10.1%		12/30/28		30,651		32,970		23,946
SandRidge Energy, Inc.	(r)(z)	Upstream	8.8%		6/1/20		46,700		46,600		16,929

Total Senior Secured Bonds									402,508		362,919

Subordinated Debt—31.3%
Alta Mesa Holdings, LP	(h)	Upstream	9.6%		10/15/18		43,300		39,051		40,756
Archrock Partners, L.P.	(h)(m)	Midstream	6.0%		4/1/21		8,555		7,456		8,063
Archrock Partners, L.P.	(h)(m)	Midstream	6.0%		10/1/22		14,283		12,338		13,297
Bellatrix Exploration Ltd.	(f)(h)(m)(o)	Upstream	8.5%		5/15/20		46,590		45,680		43,465
Brand Energy & Infrastructure Services, Inc.	(f)(h)	Service & Equipment	8.5%		12/1/21		43,311		42,444		43,564
Calpine Corp.	(f)(m)	Power	5.8%		1/15/25		5,100		5,094		5,053
Canbriam Energy Inc.	(f)(h)(j)(m)	Upstream	9.8%		11/15/19		115,200		112,133		121,537
Compressco Partners, LP	(f)(h)(m)	Service & Equipment	7.3%		8/15/22		20,050		19,903		18,772
Crestwood Equity Partners L.P.	(f)(m)	Midstream	6.1%		3/1/22		5,500		5,500		5,556
Dynegy Finance I/II Inc.	(f)(m)	Power	7.6%		11/1/24		22,542		21,956		22,180
Eclipse Resources Corp.	(f)(h)(m)	Upstream	8.9%		7/15/23		59,745		53,764		58,401
EV Energy Partners, L.P.	(h)(o)	Upstream	8.0%		4/15/19		38,814		28,337		25,811
Everest Acquisition LLC	(h)(m)(o)	Upstream	9.4%		5/1/20		19,970		15,906		14,204
Extraction Oil & Gas Holdings, LLC	(h)	Upstream	7.9%		7/15/21		37,500		37,500		39,047

See notes to unaudited consolidated financial statements.

Table of Contents

FS Energy and Power Fund

Unaudited Consolidated Schedule of Investments (Continued)
As of September 30, 2016
(in thousands, except share amounts)



Portfolio Company^(a)	Footnotes	Industry	Rate^(b)	Floor			Maturity	Principal Amount^(c)		Amortized Cost		Fair Value^(d)
Genesis Energy, L.P.	(f)(m)	Midstream	6.8%				8/1/22	$	23,540	$	22,927	$	24,285
Genesis Energy, L.P.	(f)(m)	Midstream	6.0%				5/15/23		15,280		14,080		15,221
GenOn Energy, Inc.	(h)	Power	7.9%				6/15/17		5,000		4,895		4,144
GenOn Energy, Inc.	(h)(o)	Power	9.9%				10/15/20		42,698		44,417		32,077
Global Jet Capital Inc.		Service & Equipment	15.0% PIK (15.0% Max PIK)				1/30/25		705		705		705
Global Jet Capital Inc.		Service & Equipment	15.0% PIK (15.0% Max PIK)				4/30/25		4,478		4,478		4,478
Global Jet Capital Inc.		Service & Equipment	15.0% PIK (15.0% Max PIK)				9/3/25		925		925		925
Global Jet Capital Inc.		Service & Equipment	15.0% PIK (15.0% Max PIK)				9/29/25		871		871		871
Global Partners L.P.	(f)(h)(m)(o)	Midstream	6.3%				7/15/22		69,435		69,258		64,675
Global Partners L.P.	(h)(m)	Midstream	7.0%				6/15/23		2,824		2,408		2,619
Great Western Petroleum, LLC	(f)	Upstream	9.0%				9/30/21		20,830		20,623		20,921
Gulfport Energy Corporation	(f)(m)	Upstream	7.8%				11/1/20		6,229		6,345		6,475
Jupiter Resources Inc.	(h)(m)	Upstream	8.5%				10/1/22		71,125		67,682		59,967
Laredo Petroleum, Inc.	(f)(m)	Upstream	7.4%				5/1/22		25,384		25,083		26,272
Lonestar Resources America Inc.	(h)(o)	Upstream	8.8%				4/15/19		21,500		21,573		13,599
Martin Midstream Partners L.P.	(f)(h)(m)	Midstream	7.3%				2/15/21		29,660		29,076		28,140
NRG Energy, Inc.	(f)(m)	Power	7.3%				5/15/26		25,000		24,876		25,578
ONEOK, Inc.	(f)(h)(m)(o)	Midstream	7.5%				9/1/23		28,000		26,858		31,465
Synergy Resources Corp.	(j)(m)	Upstream	9.0%				6/14/21		40,000		40,000		40,800
Talos Production LLC	(h)(o)	Upstream	9.8%				2/15/18		43,250		43,251		20,219
Tenrgys, LLC	(i)(j)	Upstream	L+900		2.5	%	12/23/18		75,000		75,000		73,125
Whiting Petroleum Corp.	(h)(m)	Upstream	5.0%				3/15/19		11,685		10,439		11,349
Zachry Holdings, Inc.	(f)	Service & Equipment	7.5%				2/1/20		23,925		23,934		24,294

Total Subordinated Debt											1,026,766		991,910

See notes to unaudited consolidated financial statements.

Table of Contents

FS Energy and Power Fund

Unaudited Consolidated Schedule of Investments (Continued)
As of September 30, 2016
(in thousands, except share amounts)



Portfolio Company^(a)	Footnotes	Industry	Number of Shares		Amortized Cost		Fair Value^(d)
Equity/Other—18.7%⁽ⁿ⁾
Abaco Energy Technologies LLC, Common Equity	(r)	Service & Equipment		6,944,444	$	6,944	$	—
Abaco Energy Technologies LLC, Preferred Equity	(r)	Service & Equipment		28,942,003		1,447		1,447
Allied Downhole Technologies, LLC, Common Equity	(k)(q)(r)	Service & Equipment		7,431,113		7,223		5,573
Allied Downhole Technologies, LLC, Warrants, 2/28/2019	(k)(q)(r)	Service & Equipment		5,344,680		1,865		4,009
Altus Power America Holdings, LLC, Preferred Equity	(l)	Power		28,125,000		27,052		46,406
Altus Power America Management, LLC, Class B Units	(r)(s)	Power		2,250		—		—
AP Exhaust Holdings, LLC, Common Equity	(k)(q)(r)	Service & Equipment		811		811		—
Ascent Resources Utica Holdings, LLC, Common Equity	(r)(t)	Upstream		148,692,909		44,700		32,712
BL Sand Hills Unit, L.P., Net Profits Interest	(r)(v)	Upstream		N/A		5,180		1,599
BL Sand Hills Unit, L.P., Overriding Royalty Interest	(v)	Upstream		N/A		740		258
Cimarron Energy Holdco Inc., Common Equity	(r)	Service & Equipment		3,201,631		2,991		1,761
Extraction Oil & Gas Holdings, LLC, Common Equity	(k)(q)(r)	Upstream		4,191,800		11,250		19,408
Fortune Creek Co-Invest I L.P., LP Interest	(m)(r)(w)(z)	Midstream		N/A		16,697		566
FourPoint Energy, LLC, Common Equity, Class C-II-A Units	(k)(p)(q)(r)	Upstream		66,000		66,000		28,875
FourPoint Energy, LLC, Common Equity, Class D Units	(k)(p)(q)(r)	Upstream		12,374		8,176		5,475
FourPoint Energy, LLC, Common Equity, Class E-II Units	(p)(r)(cc)	Upstream		274,688		68,672		114,682
FourPoint Energy, LLC, Common Equity, Class E-III Units	(k)(p)(q)(r)(cc)	Upstream		222,750		55,688		97,453
Global Jet Capital Holdings, LP, Preferred Equity	(r)	Service & Equipment		2,448,883		2,449		2,449
Industrial Group Intermediate Holdings, LLC, Common Equity	(k)(q)(r)	Service & Equipment		472,755		473		875
Lusk Operating LLC, Common Equity	(r)(u)(aa)	Upstream		2,000		1,000		—
MB Precision Investment Holdings LLC, Class A-2 Units	(k)(q)(r)	Service & Equipment		490,213		490		74
Plains Offshore Operations Inc., Preferred Equity	(l)	Upstream		21,067		27,678		25,868
Plains Offshore Operations Inc., Warrants, 11/18/2019	(r)	Upstream		427,005		689		—
Summit Midstream Partners, LLC, Preferred Equity	(l)	Midstream		28,830		28,830		28,830
Sunnova Energy Corp., Common Equity	(p)(r)	Power		6,667,368		25,026		35,804
Sunnova Energy Corp., Preferred Equity	(p)(r)	Power		578,468		3,080		3,106
Swift Worldwide Resources Holdco Limited, Common Equity	(m)(r)(x)	Service & Equipment		3,750,000		6,029		1,689
Synergy Offshore LLC, Preferred Equity	(k)(y)	Upstream		57,500		73,436		81,765
TE Holdings, LLC, Common Equity	(r)(cc)	Upstream		2,225,950		18,921		16,138
TE Holdings, LLC, Preferred Equity	(r)	Upstream		1,475,531		14,734		14,386
Titan Energy Operating, LLC, Common Equity	(k)(p)(r)	Upstream		555,497		17,554		16,387
White Star Petroleum Holdings, LLC, Common Equity	(r)(cc)	Upstream		4,867,084		4,137		4,624

Total Equity/Other						549,962		592,219

TOTAL INVESTMENTS—118.2%					$	3,987,369		3,747,676



LIABILITIES IN EXCESS OF OTHER ASSETS—(18.2%)								(575,877	)

NET ASSETS—100.0%							$	3,171,799

See notes to unaudited consolidated financial statements.

Table of Contents

FS Energy and Power Fund

Unaudited Consolidated Schedule of Investments (Continued)
As of September 30, 2016
(in thousands, except share amounts)

(a): Security may be an obligation of one or more entities affiliated with the named company.
(b): Certain variable rate securities in the Company's portfolio bear interest at a rate determined by a publicly disclosed base rate plus a basis point spread. As of September 30, 2016, the three-month London Interbank Offered Rate, or LIBOR, was 0.85% and the U.S. Prime Lending Rate, or Prime, was 3.50%.
(c): Denominated in U.S. dollars, unless otherwise noted.
(d): Fair value determined by the Company's board of trustees (see Note 7).
(e): Security is an unfunded commitment. The stated rate reflects the spread disclosed at the time of commitment and may not indicate the actual rate received upon funding.
(f): Security or portion thereof held within FSEP Term Funding, LLC and is pledged as collateral supporting the amounts outstanding under the revolving credit facility with Deutsche Bank AG, New York Branch (see Note 8).
(g): Security or portion thereof held within Energy Funding LLC and is pledged as collateral supporting the amounts outstanding under the revolving credit facility with Natixis, New York Branch (see Note 8).
(h): Security or portion thereof held within Berwyn Funding LLC and is pledged as collateral supporting the amounts outstanding under the prime brokerage facility with BNP Paribas Prime Brokerage, Inc., or BNP. Securities held within Berwyn Funding LLC may be rehypothecated from time to time as permitted under Rule 15c-1(a)(1) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, subject to the terms and conditions governing the prime brokerage facility with BNP (see Note 8).
(i): Security or portion thereof held within Wayne Funding LLC and is pledged as collateral supporting the amounts outstanding under the revolving credit facility with Wells Fargo Securities, LLC (see Note 8).
(j): Security or portion thereof held within Gladwyne Funding LLC and is pledged as collateral supporting the obligations outstanding under the repurchase transaction with Goldman Sachs Bank USA (see Note 8).
(k): Security or portion thereof held within Foxfields Funding LLC and is pledged as collateral supporting the obligations outstanding under the term loan facility with Fortress Credit Co LLC (see Note 8).
(l): Security or portion thereof held within Bryn Mawr Funding LLC and is pledged as collateral supporting the amounts outstanding under the revolving credit facility with Barclays Bank PLC (see Note 8).
(m): The investment is not a qualifying asset under the Investment Company Act of 1940, as amended, or the 1940 Act. A business development company may not acquire any asset other than a qualifying asset, unless, at the time the acquisition is made, qualifying assets represent at least 70% of the business development company's total assets. As of September 30, 2016, 81.4% of the Company's total assets represented qualifying assets.
(n): Listed investments may be treated as debt for U.S. generally accepted accounting principles, or GAAP, or tax purposes.
(o): Security or portion thereof held within Berwyn Funding LLC has been rehypothecated under Rule 15c-1(a)(1) of the Exchange Act, subject to the terms and conditions governing the prime brokerage facility with BNP (see Note 8). As of September 30, 2016, the fair value of securities rehypothecated by BNP was $111,168.
(p): Under the 1940 Act, the Company generally is deemed to be an "affiliated person" of a portfolio company if it owns 5% or more of the portfolio company's voting securities and generally is deemed to "control" a portfolio company if it owns more than 25% of the portfolio company's voting securities or it has the power to exercise control over the management or policies of such portfolio company. As of September 30, 2016, the Company held investments in portfolio companies of which it is deemed to be an "affiliated person" but is not deemed to "control". The following table presents certain information with respect to such portfolio companies for the nine months ended September 30, 2016:

Portfolio Company	Fair Value at December 31, 2015		Purchases, Paid-in-Kind Interest and Other		Sales, Repayments and Other			Accretion of Discount		Net Realized Gain (Loss)		Net Change in Unrealized Appreciation (Depreciation)			Fair Value at September 30, 2016		Interest Income		Fee Income

Senior Secured Loans—First Lien
Sunnova Asset Portfolio 5 Holdings, LLC		—	$	256,897	$	(112,836	)	$	1,901	$	566	$	4,821		$	151,349	$	16,693	$	7,356
Senior Secured Loans—Second Lien
Titan Energy Operating, LLC		—	$	83,014		—		$	373		—	$	935		$	84,322	$	1,383		—
Senior Secured Bonds
FourPoint Energy, LLC	$	222,069		—	$	(55,688	)	$	1,199		—	$	65,194		$	232,774	$	18,991		—
Equity/Other
FourPoint Energy, LLC, Common Equity, Class C-II-A Units	$	46,200		—		—			—		—	$	(17,325	)	$	28,875		—		—
FourPoint Energy, LLC, Common Equity, Class D Units	$	8,724		—		—			—		—	$	(3,249	)	$	5,475		—		—
FourPoint Energy, LLC, Common Equity, Class E-II Units		—	$	68,672		—			—		—	$	46,010		$	114,682		—		—
FourPoint Energy, LLC, Common Equity, Class E-III Units		—	$	55,688		—			—		—	$	41,765		$	97,453		—		—
Sunnova Energy Corp., Common Equity		—	$	25,026		—			—		—	$	10,778		$	35,804		—		—
Sunnova Energy Corp., Preferred Equity		—	$	46,196	$	(43,122	)		—	$	6	$	26		$	3,106		—		—
Titan Energy Operating, LLC, Common Equity		—	$	17,554		—			—		—	$	(1,167	)	$	16,387		—		—

(q): Security held within FSEP Investments, Inc., a wholly-owned subsidiary of Foxfields Funding LLC.
(r): Security is non-income producing.

See notes to unaudited consolidated financial statements.

Table of Contents

FS Energy and Power Fund

Unaudited Consolidated Schedule of Investments (Continued)
As of September 30, 2016
(in thousands, except share amounts)

(s): Security is held within EP Altus Investments, LLC, a wholly-owned subsidiary of the Company.
(t): Security held within EP American Energy Investments, Inc., a wholly-owned subsidiary of the Company.
(u): Security held within FSEP-BBH, Inc., a wholly-owned subsidiary of the Company.
(v): Security held within EP Burnett Investments, Inc., a wholly-owned subsidiary of the Company.
(w): Investment denominated in Canadian dollars. Amortized cost and fair value are converted into U.S. dollars as of September 30, 2016.
(x): Investment denominated in British pounds. Amortized cost and fair value are converted into U.S. dollars as of September 30, 2016.
(y): Security held within EP Synergy Investments, Inc., a wholly-owned subsidiary of Foxfields Funding LLC.
(z): Security was on non-accrual status as of September 30, 2016.
(aa): Under the 1940 Act, the Company generally is deemed to "control" a portfolio company if it owns more than 25% of the portfolio company's voting securities or it has the power to exercise control over the management or policies of such portfolio company. As of September 30, 2016, the Company held an investment in one portfolio company of which it is deemed to be an "affiliated person" of and deemed to "control". The following table presents certain information with respect to investments in portfolio companies of which the Company was deemed to be an "affiliated person" of and deemed to "control" for the nine months ended September 30, 2016:

Portfolio Company	Fair Value at December 31, 2015		Purchases, Paid-in-Kind Interest and Other		Sales, Repayments and Other					Net Change in Unrealized Appreciation (Depreciation)			Fair Value at September 30, 2016

Senior Secured Loans—First Lien
Lusk Operating LLC		—	$	17,289		—		—	—	$	(17,037	)	$	252	—	—
Sunnova Asset Portfolio 5 Holdings, LLC	$	244,349		—	$	(244,349	)	—	—		—			—	—	—
Equity/Other
Lusk Operating LLC, Common Equity		—		—		—		—	—		—			—	—	—
Sunnova Holdings, LLC, Common Equity	$	29,561		—	$	(29,561	)	—	—		—			—	—	—

(bb): Position or portion thereof unsettled as of September 30, 2016.
(cc): Security held within FS Energy Investments, LLC, a wholly-owned subsidiary of the Company.

See notes to unaudited consolidated financial statements.

Table of Contents

FS Energy and Power Fund

Consolidated Schedule of Investments
As of December 31, 2015
(in thousands, except share amounts)



Portfolio Company^(a)	Footnotes	Industry	Rate^(b)	Floor			Maturity	Principal Amount^(c)		Amortized Cost			Fair Value^(d)
Senior Secured Loans—First Lien—38.5%
Abaco Energy Technologies LLC	(g)(i)(j)	Service & Equipment	L+700		1.0	%	11/20/20	$	60,938	$	57,911		$	31,383
Allied Wireline Services, LLC	(g)(i)(j)(k)	Service & Equipment	L+400, 5.5% PIK (5.5% Max PIK)		1.5	%	2/28/19		103,061		101,930			96,234
Alon USA Partners, L.P.	(g)(i)(l)	Downstream	L+800		1.3	%	11/26/18		7,158		7,342			7,140
Altus Power America, Inc.	(j)	Power	L+750		1.5	%	10/10/21		46,555		46,555			46,090
Altus Power America, Inc.	(e)	Power	L+750		1.5	%	10/10/21		37,820		37,820			37,441
AP Exhaust Acquisition, LLC	(g)	Service & Equipment	L+775		1.5	%	1/16/21		15,811		15,811			14,842
BBH Operating LLC		Upstream	Prime+500 PIK (8.25% Max PIK)		3.3	%	2/26/16		24,441		24,441			17,719
BBH Operating LLC	(e)	Upstream	Prime+500 PIK (8.25% Max PIK)		3.3	%	2/26/16		5,559		5,559			4,031
BL Sand Hills Unit, L.P.		Upstream	Prime+650		3.5	%	12/17/17		36,626		31,807			34,016
BL Sand Hills Unit, L.P.	(e)	Upstream	Prime+650		3.5	%	12/17/17		19,367		16,819			17,987
Cactus Wellhead, LLC	(g)(i)(j)	Service & Equipment	L+600		1.0	%	7/31/20		51,844		51,012			37,457
Cimarron Energy Inc.	(g)	Service & Equipment	L+775, 0.0% PIK (3.75% Max PIK)		1.0	%	12/15/19		24,250		24,250			24,129
Crestwood Holdings LLC	(f)(g)(j)	Midstream	L+600		1.0	%	6/19/19		30,565		30,689			19,816
EnergySolutions, LLC	(i)(j)	Service & Equipment	L+575		1.0	%	5/29/20		20,462		20,150			18,211
EP Acquisition LLC	(q)(y)	Upstream	Prime+500 PIK (8.25% Max PIK)		3.3	%	2/26/16		525		525			—
Industrial Group Intermediate Holdings, LLC	(i)	Service & Equipment	L+800		1.3	%	5/31/20		14,951		14,951			14,801
MB Precision Holdings LLC	(g)	Service & Equipment	L+725		1.3	%	1/23/20		12,855		12,855			12,726
Moxie Liberty LLC	(g)(j)	Power	L+650		1.0	%	8/21/20		32,432		32,540			30,162
Panda Sherman Power, LLC	(g)(j)	Power	L+750		1.5	%	9/14/18		22,643		22,937			20,492
Panda Temple Power, LLC	(j)	Power	L+625		1.0	%	3/6/22		9,925		9,747			8,188
Panda Temple Power II, LLC	(g)(j)	Power	L+600		1.3	%	4/3/19		27,809		28,132			24,750
ProPetro Services, Inc.	(i)	Service & Equipment	L+625		1.0	%	9/30/19		11,612		11,599			7,838
Stallion Oilfield Holdings, Inc.	(g)(i)(j)	Service & Equipment	L+675		1.3	%	6/19/18		45,025		45,045			24,404
Stonewall Gas Gathering LLC	(j)	Midstream	L+775		1.0	%	1/28/22		26,794		25,803			26,727
Sunnova Asset Portfolio 5 Holdings, LLC	(j)(z)	Power	12.0% PIK (12.0% Max PIK)				11/14/21		250,138		245,363			244,510
Sunnova Asset Portfolio 5 Holdings, LLC	(e)(z)	Power	12.0% PIK (12.0% Max PIK)				11/14/21		7,167		7,167			7,006
Swift Worldwide Resources US Holdings Corp.	(g)(j)	Service & Equipment	L+800		1.3	%	4/30/19		59,057		59,057			59,057
UTEX Industries, Inc.	(f)	Service & Equipment	L+400		1.0	%	5/21/21		4,485		3,443			3,091
Warren Resources, Inc.	(k)	Upstream	L+850		1.0	%	5/22/20		131,175		131,175			106,907

Total Senior Secured Loans—First Lien											1,122,435			997,155
Unfunded Loan Commitments											(67,365	)		(67,365	)

Net Senior Secured Loans—First Lien											1,055,070			929,790

See notes to unaudited consolidated financial statements.

Table of Contents

FS Energy and Power Fund

Consolidated Schedule of Investments (Continued)
As of December 31, 2015
(in thousands, except share amounts)



Portfolio Company^(a)	Footnotes	Industry	Rate^(b)	Floor			Maturity	Principal Amount^(c)		Amortized Cost		Fair Value^(d)
Senior Secured Loans—Second Lien—38.2%
Alison US LLC	(f)(j)(l)	Service & Equipment	L+850		1.0	%	8/29/22	$	17,222	$	16,641	$	13,993
American Energy—Marcellus, LLC		Upstream	L+750		1.0	%	8/4/21		10,000		9,874		233
Ameriforge Group Inc.	(f)(g)	Service & Equipment	L+750		1.3	%	12/21/20		35,950		36,433		2,831
AP Exhaust Acquisition, LLC		Service & Equipment	12.0%, 0.0% PIK (12.0% Max PIK)				9/28/21		3,243		3,243		2,959
Arena Energy, LP	(i)(k)	Upstream	L+1000		1.0	%	1/24/21		65,000		65,000		59,854
Ascent Resources—Utica, LLC	(g)(j)(k)	Upstream	L+950, 2.0% PIK (2.0% Max PIK)		1.5	%	9/30/18		280,735		279,572		251,258
Atlas Resource Partners, L.P.	(i)(k)	Upstream	L+900		1.0	%	2/23/20		100,000		97,489		79,986
BlackBrush Oil & Gas, L.P.	(f)(i)	Upstream	L+650		1.0	%	7/30/21		31,519		30,708		25,268
Brock Holdings III, Inc.	(f)(g)(j)	Service & Equipment	L+825		1.8	%	3/16/18		29,605		29,766		22,796
Chief Exploration & Development LLC	(f)(i)	Upstream	L+650		1.0	%	5/16/21		19,576		19,504		13,143
Consolidated Precision Products Corp.	(g)(j)	Service & Equipment	L+775		1.0	%	4/30/21		11,574		11,529		10,532
Emerald Performance Materials, LLC	(j)	Downstream	L+675		1.0	%	8/1/22		5,319		5,296		5,055
Extraction Oil & Gas Holdings, LLC	(i)(j)	Upstream	11.0%				5/29/19		74,186		74,186		74,650
Extraction Oil & Gas Holdings, LLC	(i)(j)	Upstream	10.0%				5/29/19		32,462		32,462		32,259
Fieldwood Energy LLC	(f)(i)	Upstream	L+713		1.3	%	9/30/20		41,047		41,951		6,547
Granite Intermediate Holdings, Inc.	(f)	Power	L+725		1.0	%	10/15/22		13,150		13,047		10,257
Gruden Acquisition, Inc.	(j)	Service & Equipment	L+850		1.0	%	8/18/23		15,000		14,281		14,288
Horn Intermediate Holdings, Inc.	(g)	Service & Equipment	L+775		1.3	%	10/2/18		50,250		50,250		49,496
Jonah Energy LLC	(i)(j)	Upstream	L+650		1.0	%	5/12/21		25,133		24,821		15,960
MD America Energy, LLC	(f)(g)(j)	Upstream	L+850		1.0	%	8/4/19		41,612		40,121		34,815
Neff Rental LLC	(j)	Service & Equipment	L+625		1.0	%	6/9/21		15,145		15,182		12,570
Oxbow Carbon LLC	(g)	Midstream	L+700		1.0	%	1/19/20		15,000		14,904		12,631
P2 Upstream Acquisition Co.	(g)(j)	Service & Equipment	L+800		1.0	%	4/30/21		32,599		32,862		27,302
Templar Energy LLC	(f)(g)(i)	Upstream	L+750		1.0	%	11/25/20		89,923		88,451		10,903
Total Safety U.S., Inc.	(f)(g)(j)	Service & Equipment	L+800		1.3	%	9/13/20		14,795		14,978		8,335
UTEX Industries, Inc.	(f)(j)	Service & Equipment	L+725		1.0	%	5/20/22		36,192		36,232		23,706
Vantage Energy, LLC	(i)(j)	Upstream	L+750		1.0	%	12/20/18		30,078		29,933		19,325
Vantage Energy II, LLC	(i)(j)	Upstream	L+750		1.0	%	5/8/17		85,000		85,000		82,450

Total Senior Secured Loans—Second Lien											1,213,716		923,402

See notes to unaudited consolidated financial statements.

Table of Contents

FS Energy and Power Fund

Consolidated Schedule of Investments (Continued)
As of December 31, 2015
(in thousands, except share amounts)



Portfolio Company^(a)	Footnotes	Industry	Rate^(b)	Floor	Maturity	Principal Amount^(c)		Amortized Cost			Fair Value^(d)
Senior Secured Bonds—13.4%
American Energy—Woodford, LLC	(h)(q)(y)	Upstream	12.0% PIK (12.0% Max PIK)		12/30/20	$	7,806	$	5,662		$	1,112
FourPoint Energy, LLC	(j)(k)(o)	Upstream	8.0%		12/31/20		290,813		282,012			226,107
FourPoint Energy, LLC	(e)(o)	Upstream	8.0%		12/31/20		18,563		18,470			14,432
Gastar Exploration USA, Inc.	(h)	Upstream	8.6%		5/15/18		5,690		5,393			2,902
Light Tower Rentals, Inc.	(h)(n)	Service & Equipment	8.1%		8/1/19		17,500		17,313			8,947
Lightstream Resources Ltd.	(k)(l)	Upstream	9.9%		6/15/19		62,400		62,400			52,104
Mirant Mid-Atlantic Trust	(f)(h)(n)	Power	10.1%		12/30/28		23,344		26,097			22,556
SandRidge Energy, Inc.	(h)(n)	Upstream	8.8%		6/1/20		46,700		46,598			14,258

Total Senior Secured Bonds									463,945			342,418
Unfunded Bond Commitment									(18,470	)		(18,470	)

Net Senior Secured Bonds									445,475			323,948

Subordinated Debt—24.0%
Alta Mesa Holdings, LP	(h)(n)	Upstream	9.6%		10/15/18		18,451		18,376			6,481
Archrock Partners, L.P.	(h)(l)	Midstream	6.0%		4/1/21		3,055		2,625			2,452
Archrock Partners, L.P.	(h)(l)	Midstream	6.0%		10/1/22		10,533		8,858			8,124
Atlas Energy Holdings Operating Co., LLC	(h)	Upstream	7.8%		1/15/21		28,285		25,869			5,648
Atlas Energy Holdings Operating Co., LLC	(h)	Upstream	9.3%		8/15/21		24,460		23,574			5,022
Bellatrix Exploration Ltd.	(f)(h)(l)	Upstream	8.5%		5/15/20		45,590		44,731			30,716
Brand Energy & Infrastructure Services, Inc.	(f)(h)	Service & Equipment	8.5%		12/1/21		27,500		27,261			23,684
Calpine Corp.	(f)(l)	Power	5.8%		1/15/25		5,100		5,093			4,501
Canbriam Energy Inc.	(h)(j)(l)	Upstream	9.8%		11/15/19		115,200		111,556			104,256
Chaparral Energy Inc.	(h)(n)	Upstream	7.6%		11/15/22		15,225		16,150			3,191
Compressco Partners, LP	(f)(h)(l)	Service & Equipment	7.3%		8/15/22		20,050		19,889			14,862
Crestwood Equity Partners L.P.	(f)(l)	Midstream	6.1%		3/1/22		5,500		5,500			3,827
Dynegy Finance I/II Inc.	(f)(l)	Power	7.6%		11/1/24		17,080		16,654			14,603
Eclipse Resources Corp.	(h)(l)	Upstream	8.9%		7/15/23		27,500		26,949			13,234
EV Energy Partners, L.P.	(h)(n)	Upstream	8.0%		4/15/19		25,560		21,221			12,716
Everest Acquisition LLC	(f)(l)	Upstream	9.4%		5/1/20		14,250		14,250			9,054

See notes to unaudited consolidated financial statements.

Table of Contents

FS Energy and Power Fund

Consolidated Schedule of Investments (Continued)
As of December 31, 2015
(in thousands, except share amounts)



Portfolio Company^(a)	Footnotes	Industry	Rate^(b)	Floor			Maturity	Principal Amount^(c)		Amortized Cost		Fair Value^(d)
Genesis Energy, L.P.	(f)(l)	Midstream	6.8%				8/1/22	$	12,100	$	11,688	$	10,179
GenOn Energy, Inc.	(f)(h)(n)	Power	9.9%				10/15/20		42,698		44,669		31,383
GenOn Energy, Inc.	(h)	Power	7.9%				6/15/17		5,000		4,795		4,371
Global Jet Capital Inc.		Service & Equipment	15.0% PIK (15.0% Max PIK)				1/30/25		635		635		635
Global Jet Capital Inc.		Service & Equipment	15.0% PIK (15.0% Max PIK)				4/30/25		4,030		4,030		4,030
Global Jet Capital Inc.		Service & Equipment	15.0% PIK (15.0% Max PIK)				9/3/25		828		828		828
Global Jet Capital Inc.		Service & Equipment	15.0% PIK (15.0% Max PIK)				9/29/25		779		779		779
Global Partners L.P.	(f)(h)(l)(n)	Midstream	6.3%				7/15/22		68,350		68,350		54,424
Jones Energy, Inc.	(h)(n)	Upstream	6.8%				4/1/22		8,000		8,000		4,345
Jupiter Resources Inc.	(h)(l)	Upstream	8.5%				10/1/22		71,125		67,291		28,539
Kenan Advantage Group, Inc.	(f)	Service & Equipment	7.9%				7/31/23		11,970		11,970		11,820
Legacy Reserves LP	(h)	Upstream	8.0%				12/1/20		16,750		16,499		3,371
Legacy Reserves LP	(h)	Upstream	6.6%				12/1/21		14,000		13,847		3,028
Lonestar Resources America Inc.	(h)(n)	Upstream	8.8%				4/15/19		21,500		21,591		13,231
Martin Midstream Partners L.P.	(f)(l)	Midstream	7.3%				2/15/21		15,658		16,144		13,877
Memorial Production Partners L.P.	(h)	Upstream	6.9%				8/1/22		12,250		12,059		3,690
ONEOK, Inc.	(f)(h)(l)(n)	Midstream	7.5%				9/1/23		28,000		26,771		23,363
Seven Generations Energy Ltd.	(f)(l)	Upstream	6.8%				5/1/23		6,150		5,612		5,220
Talos Production LLC	(f)(h)(n)	Upstream	9.8%				2/15/18		43,250		43,258		17,841
Tenrgys, LLC	(i)(j)	Upstream	L+900		2.5	%	12/23/18		75,000		75,000		64,875
Whiting Petroleum Corp.	(f)(l)	Upstream	5.0%				3/15/19		4,685		4,124		3,562
Zachry Holdings, Inc.	(f)	Service & Equipment	7.5%				2/1/20		14,300		14,376		13,978

Total Subordinated Debt											860,872		579,740

See notes to unaudited consolidated financial statements.

Table of Contents

FS Energy and Power Fund

Consolidated Schedule of Investments (Continued)
As of December 31, 2015
(in thousands, except share amounts)



Portfolio Company^(a)	Footnotes	Industry	Number of Shares		Amortized Cost		Fair Value^(d)
Equity/Other—12.9%^(m)
Abaco Energy Technologies LLC, Common Equity	(q)	Service & Equipment		6,944,444	$	6,944	$	1,042
Allied Downhole Technologies, LLC, Common Equity	(k)(p)(q)	Service & Equipment		6,600,000		6,600		4,950
Allied Downhole Technologies, LLC, Warrants, 2/28/2019	(k)(p)(q)	Service & Equipment		5,344,680		1,865		4,009
Altus Power America Holdings, LLC, Preferred Equity		Power		15,518,478		15,464		28,709
Altus Power America Management, LLC, Class B Units	(q)(r)	Power		2,250		—		—
AP Exhaust Holdings, LLC, Common Equity	(k)(p)(q)	Service & Equipment		811		811		405
Ascent Resources Utica Holdings, LLC, Common Equity	(q)(s)	Upstream		15,657,194		14,900		3,131
BBH Operating LLC, Common Equity	(q)(t)	Upstream		1,000		1,000		—
BL Sand Hills Unit, L.P., Net Profits Interest	(q)(u)	Upstream		N/A		4,677		5,966
BL Sand Hills Unit, L.P., Overriding Royalty Interest	(u)	Upstream		N/A		668		227
Cimarron Energy Holdco Inc., Common Equity	(q)	Service & Equipment		2,500,000		2,500		1,750
Extraction Oil & Gas Holdings, LLC, Common Equity	(k)(p)(q)	Upstream		4,191,800		11,250		15,090
Fortune Creek Co-Invest I L.P., LP Interest	(l)(q)(v)(y)	Midstream		N/A		16,697		3,281
FourPoint Energy, LLC, Common Equity, Class C Units	(k)(o)(p)(q)	Upstream		66,000		66,000		46,200
FourPoint Energy, LLC, Common Equity, Class D Units	(k)(o)(p)(q)	Upstream		12,374		8,176		8,724
Global Jet Capital Holdings, LP, Preferred Equity	(q)	Service & Equipment		2,448,883		2,449		2,449
Industrial Group Intermediate Holdings, LLC, Common Equity	(k)(p)(q)	Service & Equipment		371,901		372		614
MB Precision Investment Holdings LLC, Class A-2 Units	(q)	Service & Equipment		490,213		490		466
Plains Offshore Operations Inc., Preferred Equity	(f)	Upstream		21,067		26,321		25,869
Plains Offshore Operations Inc., Warrants, 11/18/2019	(f)(q)	Upstream		427,005		689		—
Summit Midstream Partners, LLC, Preferred Equity		Midstream		39,163		39,163		37,205
Sunnova Holdings, LLC, Common Equity	(q)(z)	Power		1,074,951		25,026		29,561
Swift Worldwide Resources Holdco Limited, Common Equity	(l)(q)(w)	Service & Equipment		3,750,000		6,029		3,870
Synergy Offshore LLC, Preferred Equity	(k)(x)	Upstream		50,000		61,183		89,100

Total Equity/Other						319,274		312,618

TOTAL INVESTMENTS—127.0%					$	3,894,407		3,069,498



LIABILITIES IN EXCESS OF OTHER ASSETS—(27.0%)								(651,637	)

NET ASSETS—100.0%							$	2,417,861

See notes to unaudited consolidated financial statements.

Table of Contents

FS Energy and Power Fund

Consolidated Schedule of Investments (Continued)
As of December 31, 2015
(in thousands, except share amounts)

(a): Security may be an obligation of one or more entities affiliated with the named company.
(b): Certain variable rate securities in the Company's portfolio bear interest at a rate determined by a publicly disclosed base rate plus a basis point spread. As of December 31, 2015, the three-month London Interbank Offered Rate was 0.61% and the U.S. Prime Lending Rate was 3.50%.
(c): Denominated in U.S. dollars, unless otherwise noted.
(d): Fair value determined by the Company's board of trustees (see Note 7).
(e): Security is an unfunded commitment.
(f): Security or portion thereof held within FSEP Term Funding, LLC and is pledged as collateral supporting the amounts outstanding under the revolving credit facility with Deutsche Bank AG, New York Branch (see Note 8).
(g): Security or portion thereof held within Energy Funding LLC and is pledged as collateral supporting the amounts outstanding under the revolving credit facility with Natixis, New York Branch (see Note 8).
(h): Security or portion thereof held within Berwyn Funding LLC and is pledged as collateral supporting the amounts outstanding under the prime brokerage facility with BNP Paribas Prime Brokerage, Inc., or BNP. Securities held within Berwyn Funding LLC may be rehypothecated from time to time as permitted under Rule 15c-1(a)(1) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, subject to the terms and conditions governing the prime brokerage facility with BNP (see Note 8).
(i): Security or portion thereof held within Wayne Funding LLC and is pledged as collateral supporting the amounts outstanding under the revolving credit facility with Wells Fargo Securities, LLC (see Note 8).
(j): Security or portion thereof held within Gladwyne Funding LLC and is pledged as collateral supporting the obligations outstanding under the repurchase transaction with Goldman Sachs Bank USA (see Note 8).
(k): Security or portion thereof held within Foxfields Funding LLC and is pledged as collateral supporting the obligations outstanding under the term loan facility with Fortress Credit Co LLC (see Note 8).
(l): The investment is not a qualifying asset under the Investment Company Act of 1940, as amended, or the 1940 Act. A business development company may not acquire any asset other than a qualifying asset, unless, at the time the acquisition is made, qualifying assets represent at least 70% of the business development company's total assets. As of December 31, 2015, 87.8% of the Company's total assets represented qualifying assets.
(m): Listed investments may be treated as debt for U.S. generally accepted accounting principles, or GAAP, or tax purposes.
(n): Security or portion thereof held within Berwyn Funding LLC has been rehypothecated under Rule 15c-1(a)(1) of the Exchange Act, subject to the terms and conditions governing the prime brokerage facility with BNP (see Note 8). As of December 31, 2015, the fair value of securities rehypothecated by BNP was $108,340.
(o): Under the 1940 Act, the Company generally is deemed to be an "affiliated person" of a portfolio company if it owns 5% or more of the portfolio company's voting securities. As of December 31, 2015, the Company held investments in a portfolio company of which it is deemed to be an "affiliated person" but is not deemed to "control." The following table presents certain information with respect to such portfolio company for the year ended December 31, 2015:

Portfolio Company	Purchases			Interest Income		Fee Income			Net Change in Unrealized Appreciation (Depreciation)

Senior Secured Bonds
FourPoint Energy, LLC	$	67,722	—	$	21,503	$	681	—	$	(32,843	)
Equity/Other

FS Energy & Power Fund - FORM 10-Q - November 9, 2016

Attached files