Oaktree Strategic Credit Fund

Fund Risks

Sub-Fund Risks

Main risks: Risks related to blind pool of portfolio investments, Distressed investments risk, Underlying default risks, Liquidity risk, Credit risk, Investments in lower-rated Loans and debt Instruments, Investments in Secured or Unsecured Loans, Interest rate volatility risk, Leveraged credit risk, Investments in highly leveraged companies. 

The Fund may only incur indebtedness of up to a maximum of: 300% of its Net Asset Value (calculated using the Gross Method of calculation) or 250% of its Net Asset Value (calculated using the commitment method of calculation). The use of leverage may increases the potential risk of loss.

This is not a guaranteed product. Investors may risk losing part or all of their initial investment (risk of capital loss). 

This is not an exhaustive list of the risks . Other risks and costs apply, differ per share class and are subject to change. All the risks are detailed in the Prospectus available at: https://osc.brookfieldoaktree.com/about/overview

The following is a summary of the principal risks of investing in Brookfield Oaktree Wealth Solutions Alternative Funds S.A. SICAV-UCI Part II ("BOWS") and is qualified in its entirety by the more detailed risk factors sections in the offering document. Capitalized terms not otherwise defined herein are as defined in the offering document.

Main Fund Risks

Prospective investors should be aware that an investment in BOWS involves a high degree of risk and is suitable only for those investors for whom an investment in BOWS does not represent a complete investment program, and who fully understand BOWS' strategy, characteristics and risks, including the use of borrowings to leverage investments. An investment should only be considered by persons who can afford a loss of their entire investment. Investors should consult with their own tax and legal advisors about the implications of investing in BOWS. BOWS' shares are offered for purchase exclusively through, and subject to the terms of, its offering document. No assurance can be given that BOWS' investment objectives will be achieved or that investors will receive a return on their capital.

Liquidity Risks. BOWS is designed primarily for long-term investors. An investor should not invest in BOWS if the investor needs a liquid investment. Although BOWS, as a fundamental policy, will make quarterly offers to redeem up to 5% of its outstanding Shares at NAV (less costs), the number of Shares in respect of which an application to redeem is made may exceed the number of Shares that BOWS has offered to redeem, in which case not all of your Shares tendered will be redeemed. There are also circumstances in which quarterly redemptions may be suspended as described in the offering document. Hence, you may not be able to redeem your Shares when and/or in the amount that you apply for from time to time.

In exceptional circumstances and not on a systematic basis, BOWS may make exceptions to modify or suspend, in whole or in part, the redemption program if in the AIFM’s reasonable judgment it deems such action to be in BOWS' best interest and the best interest of BOWS investors, such as when redemptions of Shares would place an undue burden on BOWS' liquidity, adversely affect BOWS' operations, risk having an adverse impact on BOWS that would outweigh the benefit of redemptions of Shares or as a result of legal or regulatory changes. Material modifications, including any amendment to the 5% quarterly limitations on redemptions and suspensions of the redemption program will be promptly disclosed to Shareholders. If the redemption program is suspended, the AIFM will be required to evaluate on a monthly basis whether the continued suspension of the redemption program is in BOWS best interest and the best interest of BOWS investors.

There is no current public trading market for the Shares, and it is not expected that such a market will ever develop. Therefore, redemption of Shares by BOWS will likely be the only way for you to dispose of Shares. BOWS expects to redeem Shares at a price equal to the applicable NAV as of the Redemption Day and not based on the price at which you initially purchased their Shares. Subject to limited exceptions, Shares redeemed within one year of the date of issuance will be redeemed at 98% of the applicable NAV as of the Redemption Day. As a result, you may receive less than the price you paid for the Shares when the Shares are redeemed.

The vast majority of BOWS assets are expected to consist of investments that cannot generally be readily liquidated without impacting BOWS' ability to realize full value upon their disposition. Therefore, BOWS may not always have a sufficient amount of cash to immediately satisfy redemption requests. As a result, your ability to have your Shares redeemed by BOWS maybe limited and at times they may not be able to liquidate their investment.

Potential Conflicts of Interest. There may be occasions when BOWS and its affiliates and its advisors will encounter potential conflicts of interest in connection with its activities including, without limitation, the allocation of investment opportunities and when deciding to outsource certain services required by BOWS. There can be no assurance that BOWS and its affiliates will identify or resolve all conflicts of interest in a manner that is favourable to BOWS.

Foreign Currency Risks. A significant portion of BOWS' investments (and the income and gains received by BOWS in respect of such investments) may be denominated in currencies other than the US Dollar. Accordingly, changes in foreign currency exchange rates and exchange controls may materially adversely affect the value of the investments and the other assets of BOWS.

Highly Competitive Market for Investment Opportunities. The activity of identifying, managing, monitoring, completing and realizing attractive investments is highly competitive and involves a high degree of uncertainty. The availability of investment opportunities generally will be subject to market conditions, and BOWS expects to encounter competition from other entities having similar or overlapping investment objectives and others pursuing the same or similar opportunities. There can be no assurance that BOWS will be able to locate, complete and exit investments that satisfy BOWS’ rate of return objective or realize upon their values or that it will be able to invest fully its available capital.

Reliance on Key Personnel. The success of BOWS depends in substantial part on the skill and expertise of Brookfield professionals, including the infrastructure team and those currently employed or engaged by the Investment Manager. There can be no assurance that the Brookfield professionals will continue to be employed by Brookfield throughout the duration of BOWS. The loss of Brookfield professionals could have a material adverse effect on BOWS.

No Assurance of Investment Return. The performance of the Shares depends on the performance of the investments of BOWS, which may increase or decrease in value. The past performance of the Shares is not an assurance or guarantee of future performance. The value of the Shares at any time could be significantly lower than the initial investment and investors may lose a portion or even the entire amount originally invested. Investment objectives express an intended result only. The Shares do not include any element of capital protection and BOWS gives no assurance or guarantee to any investors as to the performance of the Shares. Depending on market conditions and a variety of other factors outside the control of BOWS, investment objectives may become more difficult or even impossible to achieve.

Market Conditions. The success of BOWS' activities will be affected by general economic and market conditions. BOWS' investment strategy and the availability of opportunities satisfying BOWS' risk-adjusted return parameters relies in part on observable trends and conditions in the financial markets and in some cases the improvement of such conditions. Trends and historical events do not imply, forecast or predict future events and, in any event, past performance is not necessarily indicative of future results. There can be no assurance that the assumptions made, or the beliefs and expectations currently held by BOWS' advisor will prove correct and actual events and circumstances may vary significantly.

Absence of recourse. The articles of association, the offering document and the agreements entered into by BOWS with its service providers (including the AIFM and the Investment Manager) include indemnification and other provisions that will limit the circumstances under which the AIFM, the Investment Manager and others can be held liable to BOWS. Additionally, certain service providers to BOWS, the AIFM, the Investment Manager and their respective affiliates and other persons, including, without limitation, placement agents and finders, may be entitled to indemnification (in certain cases on terms more favourable to them than those available to indemnified parties generally). As a result, investors may have a more limited right of action in certain cases than they would in the absence of such limitations.

Use of Leverage. BOWS intends to employ leverage to achieve its investment objective and may consider other potential uses in the future. Borrowings by BOWS will further diminish returns (or increase losses on capital) to the extent overall returns are less than BOWS' cost of funds. Such debt exposes BOWS to refinancing, recourse and other risks. As a general matter, the presence of leverage can accelerate losses.

Valuation Matters. The fair value of all investments or of property received in exchange for any investments will be determined by the AIFM in accordance with the Articles of Association and the offering document. Accordingly, the carrying value of an investment may not reflect the price at which the investment could be sold in the market, and the difference between carrying value and the ultimate sales price could be material.

SFDR. It is intended that BOWS should fall within the scope of Article 8 of Regulation (EU) 2019/2088 on sustainability related disclosures in the financial services sector (“SFDR”), but BOWS does not commit to making any “sustainable investments” within the meaning of Article 2(17) of the SFDR.

Investors should carefully consider the investment objective, risks, charges and expenses of BOWS before investing. This and other important information about BOWS is in the offering document which should be read carefully before investing.

BOWS is distributed by the AIFM.

Notice to the residents of EEA Members States. The marketing communication on this website is not contractually binding. Please refer to the offering document of BOWS and do not base any final investment decision on this communication alone. In relation to each member state of the EEA (each a "Member State") which has implemented the alternative investment fund managers directive (Directive (2011/61/EU)) ("AIFMD") (and for which transitional arrangements are not available), the information on this website may only be distributed and shares in BOWS may only be offered or placed in a Member State to the extent that: (1) BOWS is permitted to be marketed to professional investors in the relevant Member State in accordance with the AIFMD (as implemented into the local law/regulation of the relevant Member State); or (2) the information on this website may otherwise be lawfully distributed and the shares may otherwise be lawfully offered or placed in that Member State (including at the exclusive initiative of the investor).

Notice to the residents of Germany. The information on this website has not been verified by the German Federal Financial Supervisory Authority (Bundesanstalt Für Finanzdienstleistungsaufsicht, ("BAFIN")). The shares may only be marketed or acquired within Germany in accordance with the German Capital Investment Act (Kapitalanlagegesetzbuch, ("KAGB")) and any laws and regulations applicable in Germany governing the issue, offering, marketing and sale of the shares.

The shares are permitted to be marketed in Germany only to “professional investors” and “semi professional investors” as defined in the KAGB and the AIFMD.  The shares must not be marketed in Germany, neither directly nor indirectly, to German private investors as defined in the KAGB.

Prospective German investors are strongly advised to consider possible tax consequences of an investment in BOWS and should consult their own tax advisors in that respect.

Notwithstanding the references to any compartment or fund vehicle other than BOWS or any interest in any such compartment or vehicle other than BOWS on this website, no interest other than the shares are being offered hereby to prospective German investors. To the extent that this website provides information on compartments or fund vehicles other than BOWS, such information is for investor disclosure purposes only. The interests in any such compartment or other fund vehicle must not be marketed in Germany within the meaning of § 293 para. 1 KAGB.

Notice to the residents of Italy. The information on this website and the offer of the shares of BOWS is addressed to professional investors as defined in the Italian Consolidated Law on Finance no. 58 of February 24, 1998, as amended from time to time (the “FCA”) and in the regulations of the commissione nazionale per le società e la borsa ("CONSOB") issued pursuant to it, in accordance with the framework of Directive 2014/65/EU of May 15, 2014 on Markets and Financial Instruments and Regulation (EU) No 600/2014 of May, 15 2014 on Markets and Financial Instruments. In addition to professional investors, the Shares of BOWS may be offered to the following categories of investors (collectively, “Italian Qualifying Investors”):

A. Investors who subscribe or purchase shares of BOWS for an initial, not fractionable amount of Euro 500,000;

B. Entities authorized to provide portfolio management services who, in execution of their investment mandate, subscribe or purchase shares of BOWS for an initial amount of not less than Euro 100,000 on behalf of a retail investors; and

C. Investors who subscribe or purchase shares of BOWS for an initial, not fractionable amount of Euro 100,000, provided that the following two conditions jointly apply: (i) the investor’s commitments in alternative investment funds reserved to professional investors do not exceed the 10% of the aggregate investor’s financial portfolio; and (ii) the investor is making the commitment on the basis of the investment advice received from an entity duly licensed to provide such services.

The addressee acknowledges and confirms the above and hereby agrees not to circulate The information on this website in Italy unless expressly permitted by, and in compliance with, applicable law.

In addition, any investor will be required to agree and represent that any on-sale or offer of any share by such investor (in accordance with BOWS' documents) shall be made in compliance with all applicable laws and regulations.

Notice to the residents of Monaco. Shares in BOWS may not be offered or sold, directly or indirectly, to the public in Monaco other than by an authorised intermediary. The information on this website, which has not been submitted to the Clearance Procedure of the Monegasque Authorities, including the Commission de Contrôle, nor any offering material relating to the placement of shares in BOWS, may be released or issued to the public in Monaco in accordance with any such offer. The information on this website does not constitute an offer to sell securities under the Securities Laws of Monaco.

Notice to the residents of Switzerland. The information on this website does not constitute a prospectus pursuant to the Collective Investment Schemes Act dated 23 June 2006 as amended (the "CISA") or the Financial Services Act dated 15 June 2018 as amended (the "FinSA") and may not comply with the information standards required thereunder. The shares in BOWS will not be listed on the SIX Swiss Exchange or another Swiss Exchange and consequently the information presented on this website does not necessarily comply with the standards set out in the relevant listing rules.

The documentation of BOWS has not been approved by the Swiss Financial Market Supervisory Authority ("FINMA") for distribution to non-qualified investors. BOWS can only be offered to Institutional and Professional Investors within the meaning of Art. 4 (3)-(5) FINSA, as well as HNWI, private investment structures created for them and collective investment schemes with opting-out as defined in Article 5 Paragraph 1 and 4 FinSA. Therefore, investors do not benefit from supervision by FINMA. The information on this website may only be used by those persons to whom it has been delivered in connection with the shares of BOWS and may neither be copied, directly/indirectly distributed, nor made available to other persons. The information on this website does not constitute investment advice.

The Representative in Switzerland is:

MONT-FORT FUNDS AG
63 CHEMIN PLAN-PRA
1936 VERBIER
SWITZERLAND

The Paying Agent in Switzerland is:

HELVETISCHE BANK AG
SEEFELDSTRASSE 215
CH-8008 ZURICH
SWITZERLAND

Switzerland – location where the relevant documents may be obtained

The offering document, the articles of association as well as the annual reports and other shareholder reports may be obtained free of charge from the Swiss representative from the representative.

Switzerland – payment of retrocessions and rebates

BOWS and its agents do not currently pay any retrocessions to third parties as remuneration for distribution activity in respect of shares in or from Switzerland.

BOWS and its agents may, upon request, pay rebates or their equivalent directly to investors. The purpose of rebates is to reduce the fees or costs incurred by the investor in question.

Rebates are permitted provided that:

1. They are paid from fees received by BOWS and therefore do not represent an additional charge on BOWS assets;
2. They are granted on the basis of objective criteria; and
3. All investors who meet these objective criteria and demand rebates are also granted these within the same timeframe and to the same extent.

The objective criteria for the granting of rebates are as follows:

1. The size of the investor's commitment to BOWS; or
2. Investing by first close.

For additional information please refer to the offering document. At the request of the investor, BOWS must disclose the amounts of such rebates free of charge.

Switzerland – place of performance and jurisdiction

In respect of the Shares offered in Switzerland, the place of performance is the registered office of the representative. The place of jurisdiction is at the registered office of the representative or at the registered office or place of residence of the investor.