Fund Title Is FS Investment Corporation III

INVESTING IN ENERGY

A $6 trillion universe1

Why energy now?

Demand for energy has been on the rise for the past several decades, and North America has increasingly become a key supplier to the world. Meeting this growing need will require ongoing investment in U.S. energy infrastructure.

The opportunity

Investing across energy subsectors

There are five large energy subsectors, each instrumental in ensuring the uninterrupted flow of and access to energy.5

RETURNS WITHIN EACH SUBSECTOR CAN BE VOLATILE

Because each subsector can perform differently year to year, having the flexibility to move across the energy value chain as market opportunities change may improve investment returns.

TOTAL RETURNS ACROSS ENERGY SUBSECTORS

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 +56.7% -49.3% +15.9% +20.4% +10.2% +47.5% +24.6% +41.0% -50.1% +14.8% +51.7% -35.0% -12.4% +7.5% +11.3% +10.6% +13.3% +59.6% -27.0% +6.0% +34.6% -22.2% -12.9% +8.8% +14.3% +11.7% +12.9% +57.4% -25.7% +5.8% +32.9% -35.0% -12.8% +28.8% +2.1% -7.6% +13.5% +44.8% -37.3% +43.0% +46.3% -58.8% +61.5% +38.7% -10.1% +0.4% +31.5% -10.3% -21.8% +31.9% +29.9% -7.9% +4.4% +4.2% +15.1% +12.8% +16.3% +50.0% -24.0% +4.9% +28.5% -7.5% +9.2% +0.0% +12.2% +6.0% +9.1% +44.9% -28.2% +8.8%

Asset classes are represented by the following indices: Midstream equities: S&P 500 Oil & Gas Storage & Transmission Sub-Industry Index; Midstream high yield: JPMorgan Domestic High Yield Midstream Index; Pipelines high yield: JPMorgan Domestic High Yield Pipelines Index; Upstream equities: S&P 500 Oil & Gas Exploration & Production Sub-Industry Index; Upstream high yield: JPMorgan Domestic High Yield Exploration & Production Index; Energy services equities: S&P 500 Oil & Gas Equipment & Services Sub-Industry Index; Energy services high yield: JPMorgan Domestic High Yield Energy Services Index.

Investor considerations

Investing in energy and energy infrastructure companies may contain certain risks. Commodity price risk: The profitability of energy and energy infrastructure companies, particularly those involved in exploration and production, may be materially affected by the price of commodities such as crude oil and natural gas. Cyclicality risk: The operating results of energy companies tend to be cyclical. The highly cyclical nature of energy and energy infrastructure companies may adversely affect the earnings or operating cash flows of such companies. Energy demand risk: A sustained decline in demand for natural resources, including, but not limited to, crude oil, refined products, petrochemicals, natural gas, natural gas liquids, coal, metals and renewable energy sources could adversely affect the revenues and cash flows of energy and energy infrastructure companies. Regulatory risk: Energy and energy infrastructure companies are subject to stringent and complex federal, state and local environmental laws and regulations which could restrict business activity and increase compliance costs for energy companies.

Investing in energy