HMS Income Fund Fast Facts

What every potential investor should know about HMS Income Fund.

 

Public offering expected to close to new investors on or about September 30, 2017.

Exit strategy

  • Intend to explore a potential liquidity event between 4-6 years following the end of the offering period; no finite date and there is no guarantee that such a liquidity event will occur.1

  • May consider listing the company, merging or liquidating the portfolio

Quarterly repurchases2

  • Implemented a share repurchase program in September 2013; only a limited number of shares are eligible for repurchase by us.
  • The number of shares repurchased during any calendar year will be limited to the number of shares we can repurchase with the proceeds we received from the sale of shares under our DRP.
  • Quarterly repurchases will be limited to 2.5% of the weighted average number of shares of our common stock in the last four quarters
  • Repurchase price will be the net asset value as determined within 48 hours prior to the repurchase date

Tax reporting

  • 1099

Minimum investment

  • $2,500 minimum initial investment; $500 subsequent

Investor suitability

  • $70,000 gross annual income and $70,000 net worth or $250,000 net worth (in each case, excluding an investor’s home, home furnishings and autos); see prospectus for specific state requirements

Sales charges, fees and expenses

  • An investment is subject to certain transaction expenses, including sales load, dealer manager fees and offering expenses which total 11.5% and reduce the amount available for investment. An investment is also subject to management fees, incentive fees, interest on borrowed funds and other expenses which may vary based on the amount of capital raised, but could equal 6.39% annually.3

1We do not intend to list the shares on any securities exchange during the offering period, and we do not expect a secondary market in the shares to develop in the near future. Therefore, if you purchase shares you will likely have limited ability to sell your shares. We may explore a potential liquidity event.

2The board of directors has the discretion to suspend or terminate the share repurchase program to the extent that it determines that it is in our best interest to do so.

3Amount assumes the Fund sells $200.0 million worth of common stock and borrows funds equal to 50% of its net assets. Actual expenses will depend on the number of shares sold in this Offering and the amount of leverage employed. Expenses as a percentage of the offering price will increase proportionally to the extent less than $200.0 million of common stock is sold in the Offering. There can be no assurance that $200.0 million of common stock will be sold.

4There is no guarantee that the Fund will pay distributions. The amount and timing of distributions are not guaranteed. Investment income has been insufficient to fund distributions due to the incentive fee on income, which the Adviser and Sub-Adviser have agreed to waive. For the quarter ended June 30, 2017, 100% of distributions were paid from net realized income from operations (before the waiver of the incentive fee on income), 0.0% came from the waiver of the incentive fee on income, and 0.0% came from distributions in excess of net investment income, which represents adjustments made to GAAP basis net investment income to arrive at taxable income available for distributions. If the advisors had not agreed to waive their fees, these distributions would have come from investors' paid in capital. Paying distributions from sources other than net realized income lowers an investor's overall return. 

5Price effective as of the Company's January 19, 2017 weekly closing. Based upon the calculated NAV, the pricing committee reviews the offering price to ensure that shares are not being offered at a price, after deduction of selling commissions and dealer manager fees, below NAV per share. Periodic valuations will cause offering price to fluctuate.

For more information, read the prospectus for HMS Income Fund. Copies of the prospectus may be obtained from Hines Securities, Inc., 2800 Post Oak Blvd., Suite 4700, Houston, Texas 77056 or by calling 888.446.3773. You should read the prospectus carefully in order to fully understand the objectives, risks, sales charges, fees and expenses of HMS Income Fund before investing or sending money.

Annualized Distribution Rate4

7.53%

Current Per-Share Offering Price5

$9.30


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You should be aware that the Fund, the Advisers, the Dealer Manager, Main Street and Hines and their respective officers, directors, employees and affiliates do not undertake to provide impartial investment advice or to give advice in a fiduciary capacity in connection with the Fund’s public offering of, or the purchase of, the Shares. In addition, as described elsewhere in this prospectus, each of the Advisers and the Dealer Manager has a financial interest associated with this offering of the Shares, including prospective fees, expense reimbursements and other payments they anticipate receiving from the Fund in connection purchases of the Shares. This prospectus is not intended as a recommendation to make an investment in the Shares, and investors should consult their financial advisors before making an investment decision.