fs credit real estate income trust-s

1. FS Credit REIT’s share repurchase plan is subject to a 2% monthly and 5% quarterly cap of the combined NAV of all share classes then participating and other limitations and conditions as set forth in FS Credit REIT’s prospectus.
2. Select broker-dealers may have different suitability standards, may not offer all share classes, and/or may offer FS Credit REIT at a higher minimum initial investment.
3. The payment of distributions on FS Credit REIT’s common stock is subject to the discretion of the fund’s board of directors and applicable legal restrictions and, therefore, there can be no assurance as to the amount or timing of any such distributions.
4. FS Investments and Rialto split management and performance fees.
5. Once core earnings in any quarter exceed the hurdle rate, our adviser will be entitled to a catchup fee equal to the amount of core earnings in excess of the hurdle rate, until our core earnings for such quarter equal 1.806%, or 7.222% annually, of adjusted capital. Thereafter, the adviser is entitled to receive 10.0% of our core earnings. Core earnings means the net income (loss) attributable to stockholders of Class S shares computed in accordance with GAAP, including realized gains (losses) not otherwise included in GAAP net income (loss) and excluding (i) non-cash equity compensation expense, (ii) the performance fee, (iii) deprecation and amortization, (iv) any unrealized gains or losses or other similar non-cash items that are included in net income for the applicable reporting period, regardless of whether such items are included in other comprehensive income or loss, or in net income, (v) one-time events pursuant to changes in GAAP and certain material non-cash income or expense items. Adjusted capital means cumulative net proceeds generated from sales of out common stock (including proceeds from our DRP) reduced for distributions from non-liquidating dispositions of our investments paid to stockholders and amounts paid for share purchases pursuant to our share repurchase plan.
6. NAV is determined as of the last calendar day of each month by FS Real Estate Advisor in accordance with FS Credit REIT’s valuation guidelines. There is no rule, regulation or industry practice that requires the NAV be calculated in a certain way, and FS Credit REIT’s board of directors may adopt changes to the valuation guidelines. See historical NAV and annualized distribution rate information.
7. FS Credit REIT may waive these minimum investment accounts in its sole and absolute discretion.
8. Total upfront sales load consists of upfront sales commission of 3.50% for Class S shares.

Investing in FS Credit REIT involves significant risk, including the risk of a substantial loss of investment. The following are some of the risks an investment in FS Credit REIT’s common stock involves; however, you should carefully consider all of the information found in the section of FS Credit REIT’s prospectus entitled “Risk Factors” before deciding to invest in shares of FS Credit REIT’s common stock.

• Since there is no public trading market for shares of FS Credit REIT’s common stock, repurchase of shares by FS Credit REIT will likely be the only way to dispose of your shares. FS Credit REIT’s share repurchase plan will provide stockholders with the opportunity to request that FS Credit REIT repurchase their shares on a monthly basis, subject to certain limitation. Further, FS Credit REIT’s board of directors may modify or suspend our share repurchase plan if it deems such action to be in our best interest and the best interest of stockholders. Finally, FS Credit REIT is not obligated by its charter or otherwise to effect a liquidity event at any time. As a result, shares should be considered as having only limited liquidity and at times may be illiquid.
• The purchase and repurchase price for shares of FS Credit REIT’s common stock will be based on NAV and will not be based on any public trading market. Because the valuation of FS Credit REIT’s investments is inherently subjective, the NAV of FS Credit REIT’s common stock may not accurately reflect the actual price at which assets could be liquidated on any given day.
• Valuations and appraisals of real estate-related debt and investments are estimates of fair value and may not necessarily correspond to realizable value, which could adversely affect the value of an investment.
• FS Credit REIT’s business and operations are currently dependent on the commercial real estate industry. Adverse conditions in the commercial real estate industry can have a significant negative effect on FS Credit REIT’s business and financial condition.
• FS Credit REIT cannot guarantee that it will make distributions, and if it does such distributions may be funded from sources other than cash flow from operations, including, without limitation, the sale of assets, borrowings, return of capital or offering proceeds, and there are no limits on the amounts that may be paid from such sources.
• FS Credit REIT has no employees and is dependent on its adviser and sub-adviser to conduct operations. FS Credit REIT’s adviser and sub-adviser will face conflicts of interest as a result of, among other things, the obligation to allocate investment opportunities among FS Credit REIT and other investment vehicles, the allocation of time of their investment professionals and the substantial fees and expenses that we will pay to the adviser and its affiliates.
• There are limits on the ownership and transferability of FS Credit REIT’s shares.
• FS Credit REIT’s failure to qualify or remain qualified to be taxed as a REIT would adversely affect the NAV of its shares and the amount of cash available for distribution to stockholders.