Exhibit 10.8

AMENDED AND RESTATED COLLATERAL ADMINISTRATION AGREEMENT

This AMENDED AND RESTATED COLLATERAL ADMINISTRATION AGREEMENT, dated as of
September 26, 2012 (as the same may be amended from time to time in accordance
with the terms hereof (this “Agreement”) is entered into by and among Locust
Street Funding LLC, a limited liability company organized under the laws of the
State of Delaware, as issuer (the “Issuer”), FS Investment Corporation, a
corporation organized under the laws of the State of Maryland, in its capacity
as collateral manager under the Collateral Management Agreement referred to
below (in such capacity, together with its successors in such capacity, the
“Collateral Manager”) and Virtus Group, LP, a limited partnership organized
under the laws of the State of Texas, as collateral administrator (the
“Collateral Administrator”). This Agreement amends and restates in its entirety
the Collateral Administration Agreement, dated as of July 21, 2011, by and among
the Issuer, the Collateral Manager and the Collateral Administrator.

W I T N E S S E T H:

WHEREAS, the Issuer and Citibank, N.A., as trustee (the “Trustee”), have entered
into an Amended and Restated Indenture (the “Indenture”) dated as of
September 26, 2012, pursuant to which the Class A Notes (as defined in the
Indenture) were issued;

WHEREAS, pursuant to the terms of the Indenture, the Issuer pledged certain
Collateral Obligations and Eligible Investments (each as defined in the
Indenture and herein, the “Assets”) as security for the Class A Notes;

WHEREAS, the Collateral Manager has entered into an amended and restated
collateral management agreement (the “Collateral Management Agreement”) with the
Issuer, dated as of September 26, 2012, in connection with which the Collateral
Manager has agreed to provide certain services to the Issuer with respect to the
Assets;

WHEREAS, the Issuer wishes to engage the Collateral Administrator to perform on
its behalf certain administrative duties of the Issuer with respect to the
Assets pursuant to the Indenture; and

WHEREAS, the Collateral Administrator, on behalf of the Issuer, is prepared to
perform certain specified obligations of the Issuer under the Indenture or of
the Collateral Manager under the Indenture, and certain other services as
specified herein.

NOW, THEREFORE, in consideration of the mutual covenants contained herein, and
other good and valuable consideration the receipt of which is hereby
acknowledged, the parties hereto agree as follows:

1. Definitions. Capitalized terms not otherwise defined in this Agreement shall
have the meanings set forth in the Indenture.

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2. Powers and Duties of the Collateral Administrator and the Collateral Manager.

(a) The Collateral Administrator shall act as agent for the Issuer until the
earlier of (i) its resignation or removal pursuant to Section 7 hereof or
(ii) the termination of this Agreement pursuant to Section 6 or Section 7
hereof. The Collateral Administrator shall assist the Collateral Manager in
connection with monitoring the Collateral Obligations and Eligible Investments
on an ongoing basis and providing to the Issuer certain reports, schedules and
other data which the Issuer is required to prepare and deliver under Article 10
of the Indenture. The Collateral Administrator’s duties and authority to act as
collateral administrator hereunder are limited to the duties and authority
specifically provided for in this Agreement and under the Indenture. The
Collateral Administrator shall not be deemed to assume the obligations of the
Issuer under the Indenture or of the Collateral Manager under the Collateral
Management Agreement or the Indenture. The Collateral Administrator shall
perform those duties and functions assigned to it in the Indenture, comply with
all obligations applicable to it under the Indenture and perform its duties
hereunder in accordance with the terms of this Agreement and the terms of the
Indenture applicable to it.

(b) Promptly following the Closing Date, the Collateral Administrator shall
create a Collateral Obligation and Eligible Investments database. Upon request
for specific information in the Collateral Obligation and Eligible Investments
database from the Collateral Manager, the Collateral Administrator shall
promptly provide such information to the Collateral Manager. The Collateral
Administrator shall update the Collateral Obligation and Eligible Investments
database promptly following (i) the sale or disposition of any Collateral
Obligation or Eligible Investment and (ii) the purchase of any Collateral
Obligation or Eligible Investment.

(c) Not later than the Business Day prior to the day on which each Monthly
Report or Valuation Report is required to be provided by the Issuer to the
Trustee pursuant to Section 10.5(a) or Section 10.5(b) of the Indenture,
respectively, the Collateral Administrator shall prepare the relevant report by
calculating, using the information contained in the Collateral Obligation and
Eligible Investments database created by the Collateral Administrator pursuant
to Section 2(b) above, and subject to the Collateral Administrator’s receipt
from the Collateral Manager of information with respect to the Collateral
Obligation or Eligible Investment that is not contained in such database and
subject further to the provisions of this Section 2, each item required to be
stated in such Monthly Report or Valuation Report (together with Payment Date
disbursement instructions) in accordance with the Indenture and provide the
results of such calculations to the Collateral Manager so that the Collateral
Manager may confirm such results. Upon approval by the Collateral Manager, the
Collateral Administrator shall deliver the Monthly Report or Valuation Report to
the Trustee, to be posted to the Trustee’s website in the manner contemplated in
the Indenture.

(d) Upon request of the Collateral Manager in connection with a proposed
purchase of a Collateral Obligation pursuant to Section 12.2 of the Indenture
(accompanied by such information concerning the Collateral Obligation to be
purchased as may be necessary to make the calculations referred to in this
Section 2(d)), the Collateral Administrator shall calculate each criterion
(including in the Reinvestment Criteria and the Coverage Tests or any other
calculations contained in Section 12.2 of the Indenture requested by the
Collateral Manager) as a condition to such purchase in accordance with the
Indenture and provide the results of such calculations to the Collateral Manager
for comparison to the Collateral Manager’s own calculations in determining
whether such purchase is permitted by the Indenture.

 

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(e) Upon notification by the Collateral Manager during each time period as set
forth in Section 12.1 of the Indenture of a proposed disposition of a Defaulted
Obligation, Equity Security, Exchanged Equity Security, Withholding Tax Security
or Collateral Obligation (accompanied by such information as may be necessary to
make the calculation referred to in this Section 2(e)), the Collateral
Administrator shall calculate each criterion set forth in the designated
subsection of Section 12.2 of the Indenture as a condition to such disposition
in accordance with the Indenture and shall provide the results of such
calculations to the Collateral Manager.

(f) The Collateral Administrator shall have no liability for any determination
to purchase or sell a Collateral Obligation made by the Collateral Manager based
on the calculations provided by the Collateral Administrator pursuant to
Section 2(d) or Section 2(e), as applicable, except to the extent due to the
gross negligence, fraud or willful misconduct of the Collateral Administrator.
The Collateral Manager hereby agrees that any determination to purchase or sell
a Collateral Obligation made by the Collateral Manager is not based solely upon
the calculations of the Collateral Administrator.

(g) The Collateral Administrator shall assist the Independent certified public
accountants in the preparation of those reports required under Section 10.7 of
the Indenture. In the event the firm or firms of Independent certified public
accountants appointed by the Issuer for purposes of reviewing and delivering the
reports or certificates of such accountants required by the Indenture requires
the Collateral Administrator to agree to the procedures performed by such firm
or requires the Collateral Administrator to execute any documents in order to
obtain a copy of such reports or certificates, the Issuer hereby directs the
Collateral Administrator to so agree; it being understood and agreed that the
Collateral Administrator will deliver such letter of agreement in conclusive
reliance on the foregoing direction of the Issuer, and the Collateral
Administrator shall make no inquiry or investigation as to, and shall have no
obligation in respect of, the sufficiency, validity or correctness of such
procedures.

(h) [Reserved].

(i) The Collateral Administrator shall assist the Collateral Manager in the
preparation of such other reports that may be required by the Indenture and that
are reasonably requested in writing by the Collateral Manager and agreed to by
the Collateral Administrator, which agreement shall not be unreasonably
withheld.

(j) [Reserved].

(k) The Collateral Administrator shall promptly forward to the Collateral
Manager copies of notices and other writings received by it, in its capacity as
Collateral Administrator hereunder, from the obligor or other Person with
respect to any Collateral Obligation or from any Clearing Agency with respect to
any Collateral Obligation advising the holders of such obligation of any rights
that the holders might have with respect thereto (including notices of calls and
redemptions thereof) as well as all periodic financial reports received from
such obligor or other Person with respect to such obligation and Clearing
Agencies with respect to such obligor.

 

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(l) The Collateral Manager reasonably shall assist and cooperate with the
Collateral Administrator in connection with the preparation by the Collateral
Administrator of all reports, instructions, the Monthly Reports, the Valuation
Reports and statements and certificates required in connection with the
acquisition and disposition of Collateral Obligations, Defaulted Obligations,
Withholding Tax Securities, Eligible Investments, Equity Securities and
Exchanged Equity Securities or as otherwise required under the Indenture.
Without limiting the generality of the foregoing, the Collateral Manager shall
advise the Collateral Administrator in a timely manner of the results of any
determinations, designations and selections made by it as required or permitted
under the Indenture and supply the Collateral Administrator with such other
information as is in the possession of the Collateral Manager that the
Collateral Administrator may from time to time reasonably request with respect
to the Assets and is reasonably needed to complete the reports and certificates
required to be prepared by the Collateral Administrator hereunder or reasonably
required to permit the Collateral Administrator to perform its obligations
hereunder, including any information that may be reasonably required under the
Indenture with respect to or as to the designation of any Collateral Obligation,
including but not limited to a Credit Risk Obligation, Credit Improved
Obligation, Current Pay Obligation, Discount Obligation, First Lien Last Out
Loan, Defaulted Obligation, Exchange Defaulted Obligation, DIP Loan, Equity
Security, Exchanged Equity Security, Withholding Tax Security, Senior Secured
Loan, Senior Secured Note, Second Lien Loan, Senior Unsecured Loan, Subordinated
Loan, Substitute Collateral Obligation, CCC Collateral Obligation, Deferrable
Obligation, Deferring Obligation, Fixed Rate Collateral Obligation, Bonds,
Partial Deferrable Obligation, Letter of Credit, LIBOR Floor Obligation,
Synthetic Security, Participation (and the related selling institution and its
rating by each Rating Agency) and Structured Finance Obligation, whether a
Specified Amendment or Specified Event has occurred and the S&P Rating and the
Market Value of any Collateral Obligation to the extent required by the
Indenture. Nothing herein shall obligate the Collateral Administrator to
determine independently the correct characterization, classification or
categorization of any Asset held under the Indenture or the Market Value of any
Asset (it being understood that any such characterization, classification,
categorization or Market Value shall be based exclusively upon the determination
and notification received by the Collateral Administrator from the Collateral
Manager or the Issuer). The Collateral Administrator shall have no obligation to
determine whether any Asset meets the definition of “Collateral Obligation”. The
Collateral Manager shall review and verify the contents of the aforesaid
reports, instructions, statements and certificates and shall send such reports,
instructions, statements and certificates to the Issuer for execution. Such
reports, instructions, statements and certificates after execution by the Issuer
or the Collateral Manager, as applicable, will be made available to Holders on
the Trustee’s website.

(m) Not later than two Business Days prior to each Payment Date, the Collateral
Administrator shall calculate the Priority of Payments and provide a written
report to the Collateral Manager and the Trustee setting forth all amounts that
the Trustee will be required to remit on such Payment Date and such other
information required for the Trustee to make such remittances.

 

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(n) If, in performing its duties under this Agreement, the Collateral
Administrator is required to decide between alternative courses of action or if
there are alternative methodologies that can be used in connection with any
calculations required to be performed by the Collateral Administrator hereunder,
the Collateral Administrator may request written instructions from the
Collateral Manager as to the course of action or methodology to be used by the
Collateral Administrator; provided, however, that except to the extent required
by the Indenture or the Collateral Management Agreement, the Collateral Manager
shall be under no obligation to provide such instructions. If the Collateral
Administrator does not receive such instructions within two Business Days after
it has requested them, it may, but shall be under no duty to, take or refrain
from taking such action provided that the Collateral Administrator as promptly
as possible notifies the Collateral Manager and the Issuer which course of
action, if any (or refrainment from taking any course of action), it has decided
to take. The Collateral Administrator shall act in accordance with instructions
received after such two-Business Day period. The Collateral Administrator shall
be entitled to rely on the advice of legal counsel selected with due care and
Independent certified public accountants in performing its duties hereunder and
shall be deemed to have acted in good faith if it acts in accordance with such
advice, unless such advice is in conflict with this Agreement. Nothing herein
shall prevent the Collateral Administrator or any of its Affiliates from
engaging in other businesses or from rendering services of any kind to any
Person.

(o) The Collateral Administrator shall provide the Collateral Manager and the
Trustee with written notice if, as of any Measurement Date, the percentage
equivalent of a fraction (i) the numerator of which is equal to (1) the
Aggregate Principal Amount of all Collateral Obligations plus (2) the aggregate
Market Value of all Defaulted Obligations as of such date and (ii) the
denominator of which is equal to the Aggregate Outstanding Amount of the Class A
Notes, shall fail to equal or exceed 130%.

3. Compensation. Subject to Section 13, the Issuer agrees to pay, and the
Collateral Administrator shall be entitled to receive, as compensation for and
reimbursement of expenses in connection with the Collateral Administrator’s
performance of the duties called for herein, the amounts set forth in a separate
fee letter among the Collateral Manager, the Trustee and the Collateral
Administrator. In accordance with Section 13, all amounts payable under this
Section 3 shall be payable only in accordance with, and subject to, the Priority
of Payments as set forth in the Indenture.

4. Limitation of Responsibility of the Collateral Administrator. (a) The
Collateral Administrator will have no responsibility under this Agreement other
than to render the services called for hereunder in good faith and without
willful misfeasance, gross negligence or reckless disregard of its duties
hereunder. The Collateral Administrator shall incur no liability to anyone in
acting upon, and may rely conclusively upon, any signature, instrument,
statement, notice, resolution, request, direction, consent, order, certificate,
report, opinion, bond or other document or paper reasonably believed by it to be
genuine and reasonably believed by it to be signed by the proper party or
parties. Subject to Section 12, the Collateral Administrator may exercise any of
its rights or powers hereunder or perform any of its duties hereunder either
directly or by or through agents or attorneys, and the Collateral Administrator
shall not be responsible for any misconduct or negligence on the part of any
agent or attorney appointed hereunder with due care by it. The Collateral
Administrator shall be entitled to the same rights, protections and

 

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immunities that are afforded to the Trustee under Article 6 of the Indenture.
Neither the Collateral Administrator nor any of its Affiliates, directors,
officers, shareholders, members, agents or employees will be liable to the
Collateral Manager, the Issuer or others, except by reason of acts or omissions
constituting bad faith, willful misfeasance, gross negligence or reckless
disregard of the Collateral Administrator’s duties hereunder. Anything in this
Agreement notwithstanding, in no event shall the Collateral Administrator be
liable for special, punitive, indirect or consequential damage of any kind
whatsoever (including but not limited to lost profits), even if the Collateral
Administrator has been advised of such loss or damage and regardless of the form
of action under or pursuant to this Agreement, its duties or obligations
hereunder or arising out of or relating to the subject matter hereof. The
Collateral Administrator shall in no event have any liability for the actions or
omissions of the Issuer, the Collateral Manager or any other Person, and shall
have no liability for any inaccuracy or error in any duty performed by it that
results from or is caused by inaccurate, untimely or incomplete information or
data received by it from the Issuer, the Collateral Manager or another Person
except to the extent that such inaccuracies or errors are caused by the
Collateral Administrator’s own bad faith, willful misfeasance, gross negligence
or reckless disregard of its duties hereunder. The Collateral Administrator
shall not be liable for failing to perform or delay in performing its specified
duties hereunder which results from or is caused by a failure or delay on the
part of the Issuer, the Collateral Manager or another Person in furnishing
necessary, timely and accurate information to the Collateral Administrator
except to the extent that any failure or delay is caused by the Collateral
Administrator’s own criminal conduct, fraud, bad faith, willful misfeasance,
gross negligence or reckless disregard of its duties hereunder. The duties and
obligations of the Collateral Administrator and its employees or agents shall be
determined solely by the express provisions of this Agreement and they shall not
be under any obligation or duty except for the performance of such duties and
obligations as are specifically set forth herein, and no implied covenants shall
be read into this Agreement against them. For purposes of monitoring changes in
ratings, the Collateral Administrator shall be entitled to use and rely (in good
faith) exclusively upon one or more reputable electronic financial information
reporting services, and shall have no liability for any inaccuracies in the
information reported by, or other errors or omissions of, any such services.

(b) To the extent of any ambiguity in the interpretation of any definition or
term contained in the Indenture, the Collateral Administrator shall request
direction from the Collateral Manager as to the interpretation used, and the
Collateral Administrator shall follow such direction, and together with the
Trustee, shall be entitled to conclusively rely thereon without any
responsibility or liability therefor.

(c) The Issuer shall reimburse, indemnify and hold harmless the Collateral
Administrator, and its Affiliates, directors, officers, shareholders, members,
agents and employees with respect to all out-of-pocket expenses, losses,
damages, liabilities, demands, charges and claims of any nature (including the
reasonable fees and expenses of counsel and other experts) in connection with or
arising out of this Agreement and the Indenture, other than any such expenses,
losses, damages, liabilities, demands, charges or claims incurred by reason of
the bad faith, willful misfeasance, gross negligence or reckless disregard by
the Collateral Administrator of its duties hereunder.

 

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(d) The Collateral Administrator shall reimburse, indemnify and hold harmless
the Collateral Manager and the Issuer and their respective Affiliates,
directors, officers, shareholders, members, agents and employees with respect to
all expenses, losses, damages, liabilities, demands, charges and claims of any
nature (including the reasonable fees and expenses of counsel and other experts)
in respect of or arising out of any acts or omissions performed or omitted, as
the case may be, by the Collateral Administrator, its Affiliates, directors,
officers, shareholders, members, agents or employees hereunder or in connection
with the Indenture made in bad faith or constituting willful misfeasance, gross
negligence or reckless disregard of its duties hereunder.

(e) The Collateral Manager will have no responsibility under this Agreement
other than to render the services called for hereunder or in connection with the
Indenture in good faith and without willful misfeasance, gross negligence or
reckless disregard of its duties hereunder. The Collateral Manager will not be
liable to the Collateral Administrator, the Issuer or others, except by reason
of acts or omissions constituting bad faith, willful misfeasance, gross
negligence or reckless disregard of the Collateral Manager’s duties hereunder.
The Collateral Manager shall reimburse, indemnify and hold harmless the
Collateral Administrator and its Affiliates, directors, officers, shareholders,
members, agents and employees with respect to all expenses, losses, damages,
liabilities, demands, charges and claims of any nature (including the reasonable
fees and expenses of counsel and other experts) in respect of or arising out of
any acts or omissions performed or omitted, as the case may be, by the
Collateral Manager, its Affiliates, directors, officers, shareholders, members,
agents or employees hereunder made in bad faith or constituting willful
misfeasance, gross negligence or reckless disregard of its duties hereunder or
under the Indenture. Anything in this Agreement notwithstanding, in no event
shall the Collateral Manager be liable for special, indirect or consequential
damage of any kind whatsoever (including but not limited to lost profits), even
if Collateral Manager has been advised of such loss or damage and regardless of
the form of action.

(f) In connection with the aforesaid indemnification provisions, upon reasonable
prior notice, any indemnified party will afford to the applicable indemnifying
party the right, in its sole discretion and at its sole expense, to assume the
defense of any claim, including, but not limited to, the right to designate
counsel and to control all negotiations, litigation, arbitration, settlements,
compromises and appeals of such claim; provided, that if the indemnifying party
assumes the defense of such claim, it shall not be liable for any fees and
expenses of counsel for any indemnified party incurred thereafter in connection
with such claim except that if such indemnified party reasonably determines that
counsel designated by the indemnifying party has a conflict of interest, such
indemnifying party shall pay the reasonable fees and disbursements of one
counsel (in addition to any local counsel) separate from its own counsel for all
indemnified parties in connection with any one action or separate but similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances; and provided, further, that prior to entering into
any final settlement or compromise, such indemnifying party shall seek the
consent of the indemnified party and use its best efforts in the light of the
then-prevailing circumstances (including, without limitation, any express or
implied time constraint on any pending settlement offer) to obtain the consent
of such indemnified party as to the terms of settlement or compromise. If an
indemnified party does not consent to the settlement or compromise within a
reasonable time under the circumstances, the indemnifying party shall not
thereafter be obligated to indemnify the indemnified party for any amount in
excess of such proposed settlement or compromise.

 

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5. No Joint Venture. Nothing contained in this Agreement (i) shall constitute
the Collateral Administrator, the Issuer and the Collateral Manager as members
of any partnership, joint venture, association, syndicate, unincorporated
business or other separate entity, (ii) shall be construed to impose any
liability as such on any of them or (iii) shall be deemed to confer on any of
them any express, implied or apparent authority to incur any obligation or
liability on behalf of the others.

6. Term. This Agreement shall continue in effect so long as the Indenture
remains in effect with respect to the Notes, unless this Agreement has been
previously terminated in accordance with Section 7 hereof. Notwithstanding the
foregoing, the indemnification obligations of all parties under Section 4 hereof
shall survive the termination of this Agreement or release of any party hereto
with respect to matters occurring prior to such termination or release.

7. Termination; Resignation and Appointment of Successor.

(a) This Agreement may be terminated without cause by any party hereto upon not
less than 90 days’ prior written notice to each other party hereto.

(b) At the option of the Collateral Manager or the Issuer, this Agreement shall
be terminated upon ten days’ written notice of termination from the Collateral
Manager or the Issuer to the Collateral Administrator if any of the following
events shall occur:

(i) The Collateral Administrator shall default in the performance of any of its
material duties under this Agreement and shall not cure such default within
thirty days (or, if such default cannot be cured in such time, shall not give
within thirty days such assurance of cure as shall be reasonably satisfactory to
the Collateral Manager or the Issuer);

(ii) The Collateral Administrator shall be dissolved (other than pursuant to a
consolidation, amalgamation or merger) or shall have a resolution passed for its
winding up, official management or liquidation (other than pursuant to a
consolidation, amalgamation or merger);

(iii) A court having jurisdiction in the premises shall enter a decree or order
for relief in respect of the Collateral Administrator in any involuntary case
under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, or appoint a receiver, liquidator, assignee, custodian,
trustee, sequestrator (or similar official) of the Collateral Administrator or
for any substantial part of its property, or order the winding-up or liquidation
of its affairs; or

(iv) The Collateral Administrator shall commence a voluntary case under
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or shall consent to the entry of an order for relief in an involuntary
case under any such

 

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law, or shall consent to the appointment of or taking possession by a receiver,
liquidator, assignee, trustee, custodian, sequestrator (or similar official) of
the Collateral Administrator or for any substantial part of its property, or
shall make any general assignment for the benefit of creditors, or shall fail
generally to pay its debts as they become due.

If any of the events specified in clauses (ii), (iii) or (iv) of this
Section 7(b) shall occur, the Collateral Administrator shall give written notice
thereof to the Collateral Manager and the Issuer within one Business Day after
the happening of such event.

(c) Upon receiving any notice of resignation of the Collateral Administrator or
removal by the Issuer, the Issuer shall promptly appoint a successor collateral
administrator by written instrument, in duplicate, executed by an Authorized
Officer of the Issuer, one copy of which shall be delivered to the Collateral
Administrator so resigning or removed and one copy to·the successor collateral
administrator. No resignation or removal of the Collateral Administrator shall
be effective until a successor collateral administrator shall have been
appointed and shall have accepted such appointment hereunder in writing. If the
Issuer shall fail to appoint a successor collateral administrator within 30 days
after such notice of resignation, then the Collateral Administrator may petition
any court of competent jurisdiction for the appointment of a successor
collateral administrator. Notwithstanding the foregoing, the Collateral
Administrator may resign its duties hereunder without any requirement that a
successor collateral administrator be obligated hereunder and without any
liability for further performance of any duties hereunder upon at least 90 days’
prior written notice to the other parties hereto upon the occurrence of any of
the following events and the failure to cure such event within such 90 day
notice period: (i) failure of the Issuer to pay any of the amounts specified in
Section 3 within 90 days after such amount is due pursuant to Section 3 hereof
or (ii) failure of the Collateral Manager or the Issuer to provide any indemnity
payment or expense reimbursement to the Collateral Administrator required under
Section 4 hereof within 90 days of the receipt by the Collateral Manager or the
Issuer of a written request for such payment or reimbursement.

8. Representations and Warranties.

(a) The Issuer hereby represents and warrants to the Collateral Administrator
and the Collateral Manager as follows:

(i) The Issuer has been duly incorporated and is validly existing and in good
standing under the laws of the State of Delaware and has the full power and
authority to execute, deliver and perform this Agreement and all obligations
required hereunder and has taken all necessary action to authorize this
Agreement on the terms and conditions hereof, the execution, delivery and
performance of this Agreement and the performance of all obligations imposed
upon it hereunder. No consent of any other person including, without limitation,
members, shareholders and creditors of the Issuer, and no license, permit,
approval or authorization of, exemption by, notice or report to, or
registration, filing or declaration with, any governmental authority is required
to be obtained or made by the Issuer in connection with this Agreement or the
execution, delivery, performance, validity or enforceability of this Agreement
and the obligations

 

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imposed upon it hereunder. This Agreement constitutes, and each instrument or
document required hereunder, when executed and delivered by the Issuer
hereunder, will constitute, the legally valid and binding obligations of the
Issuer enforceable against the Issuer in accordance with their terms subject, as
to enforcement, (a) to the effect of bankruptcy, insolvency or similar laws
affecting generally the enforcement of creditors’ rights as such laws would
apply in the event of any bankruptcy, receivership, insolvency or similar event
applicable to the Issuer and (b) to general equitable principles (whether
enforceability of such principles is considered in a proceeding at law or in
equity).

(ii) The execution, delivery and performance by the Issuer of this Agreement,
the Issuer’s obligations hereunder and the documents and instruments required
hereunder will not violate any provision of any existing law or regulation
binding on the Issuer, or any order, judgment, award or decree of any court,
arbitrator or governmental authority binding on the Issuer, or the governing
instruments of, or any securities issued by, the Issuer or of any mortgage,
indenture, lease, contract or other agreement, instrument or undertaking to
which the Issuer is a party or by which the Issuer or any of its assets may be
bound, the violation of which would have a material adverse effect on the
business, operations, assets or financial condition of the Issuer and will not
result in, or require, the creation or imposition of any lien on any of its
property, assets or revenues pursuant to the provisions of any such mortgage,
indenture, lease, contract or other agreement, instrument or undertaking.

(b) The Collateral Manager hereby represents and warrants to the Collateral
Administrator and the Issuer as follows:

(i) The Collateral Manager has been duly formed and is validly existing and in
good standing under the laws of the State of Maryland as a corporation and has
the full power and authority to execute, deliver and perform this Agreement and
all obligations required hereunder and has taken all necessary action to
authorize this Agreement on the terms and conditions hereof, the execution,
delivery and performance of this Agreement and the performance of all
obligations imposed upon it hereunder. No consent of any other person including,
without limitation, shareholders and creditors of the Collateral Manager, and no
license, permit, approval or authorization of, exemption by, notice or report
to, or registration, filing or declaration with, any governmental authority is
required by the Collateral Manager in connection with this Agreement or the
execution, delivery, performance, validity or enforceability of this Agreement
and the obligations imposed upon it hereunder. This Agreement constitutes, and
each instrument or document required hereunder, when executed and delivered by
the Collateral Manager hereunder, will constitute, the legally valid and binding
obligations of the Collateral Manager enforceable against the Collateral Manager
in accordance with their terms subject, as to enforcement, (a) to the effect of
bankruptcy, insolvency or similar laws affecting generally the enforcement of
creditors’ rights as such laws would apply in the event of any bankruptcy,
receivership, insolvency or similar event applicable to the Collateral Manager
and (b) to general equitable principles (whether enforceability of such
principles is considered in a proceeding at law or in equity).

 

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(ii) The execution, delivery and performance of this Agreement, the Collateral
Manager’s obligations hereunder and the documents and instruments required
hereunder will not violate any provision of any existing law or regulation
binding on the Collateral Manager, or any order, judgment, award or decree of
any court, arbitrator or governmental authority binding on the Collateral
Manager, or the governing instruments of, or any securities issued by, the
Collateral Manager or of any mortgage, indenture, lease, contract or other
agreement, instrument or undertaking to which the Collateral Manager is a party
or by which the Collateral Manager or any of its assets may be bound, the
violation of which would have a material adverse effect on the business,
operations, assets or financial condition of the Collateral Manager and will not
result in, or require, the creation or imposition of any lien on any of its
property, assets or revenues pursuant to the provisions of any such mortgage,
indenture, lease, contract or other agreement, instrument or undertaking.

(c) The Collateral Administrator hereby represents and warrants to the
Collateral Manager and the Issuer as follows:

(i) The Collateral Administrator is a limited partnership duly organized and
validly existing under the laws of the State of Texas and has full power and
authority to execute and deliver this Agreement and perform all obligations
required hereunder and has taken all necessary action to authorize this
Agreement on the terms and conditions hereof, the execution and delivery of this
Agreement and the performance of all obligations required hereunder. No consent
of any other person including, without limitation, partners and creditors of the
Collateral Administrator, and no license, permit, approval or authorization of,
exemption by, notice or report to, or registration, filing or declaration with,
any governmental authority is required by the Collateral Administrator in
connection with this Agreement or the execution, delivery, performance, validity
or enforceability of this Agreement and the obligations imposed upon it
hereunder. This Agreement constitutes, and each instrument and document required
hereunder, when executed and delivered by the Collateral Administrator
hereunder, will constitute, the legally valid and binding obligations of the
Collateral Administrator enforceable against the Collateral Administrator in
accordance with their terms subject, as to enforcement, (a) to the effect of
bankruptcy, insolvency or similar laws affecting generally the enforcement of
creditors’ rights as such laws would apply in the event of any bankruptcy,
receivership, insolvency or similar event applicable to the Collateral
Administrator and (b) to general equitable principles (whether enforceability of
such principles is considered in a proceeding at law or in equity).

(ii) The execution, delivery and performance of this Agreement, the Collateral
Administrator’s obligations hereunder and the documents and instruments required
hereunder will not violate any provision of any existing law or regulation
binding on the Collateral Administrator, or any order, judgment, award or decree
of any court, arbitrator or governmental authority binding on the Collateral
Administrator, or the organizational documents of the Collateral Administrator
or of any mortgage, indenture, lease, contract or other agreement, instrument or
undertaking to which the Collateral Administrator is a party or by which the
Collateral Administrator or any of its assets may be bound, the violation of
which would have a material adverse effect on the business,

 

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operations, assets or financial condition of the Collateral Administrator and
will not result in, or require, the creation or imposition of any lien on any of
its property, assets or revenues pursuant to the provisions of any such
mortgage, indenture, lease, contract or other agreement, instrument or
undertaking.

9. Amendments. This Agreement may not be amended, changed, modified or
terminated (except as otherwise expressly provided herein) except by the
Collateral Manager, the Issuer and the Collateral Administrator in writing.

10. Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH, AND
THIS AGREEMENT AND ANY MATTERS ARISING OUT OF OR RELATING IN ANY WAY WHATSOEVER
TO THIS AGREEMENT (WHETHER IN CONTRACT, TORT OR OTHERWISE) SHALL BE GOVERNED BY,
THE LAWS OF THE STATE OF NEW YORK.

11. Notices. All notices, requests, directions and other communications
permitted or required hereunder shall be in writing and shall be deemed to have
been duly given (i) when delivered personally, (ii) when transmitted by
facsimile or other electronic means of communication (it being agreed that such
notice shall be effective at the time that a transmission report confirming
transmission is generated by the sender’s facsimile machine) or (iii) when
mailed, first class postage prepaid, or sent by overnight courier service, to
the parties at their respective addresses set forth below (or to such other
address as a party may have specified by written notice given to the other
parties pursuant to this provision.

If to the Collateral Administrator, to:

Virtus Group, LP

5400 Westheimer Court

Suite 760

Houston, Texas 77056

Telecopy: (866) 816-3203

If to the Issuer, to:

c/o FS Investment Corporation

Cira Centre

2929 Arch Street, Suite 675

Philadelphia, Pennsylvania 19104

Facsimile: (215) 222-4649

Attention: Gerald F. Stahlecker

If to the Collateral Manager, to:

FS Investment Corporation

Cira Centre

2929 Arch Street, Suite 675

Philadelphia, Pennsylvania 19104

Facsimile: (215) 222-4649

Attention: Gerald F. Stahlecker

 

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12. Successors and Assigns. This Agreement shall inure to the benefit of, and be
binding upon, the successors and assigns of each of the Collateral Manager, the
Issuer and the Collateral Administrator (including by merger or consolidation);
provided, however, that the Collateral Administrator may not assign its rights
and obligations hereunder without the prior written consent of the Collateral
Manager and the Issuer, except that the Collateral Administrator may delegate
to, employ as agent, or otherwise cause any duty or obligation hereunder to be
performed by, any Affiliate of the Collateral Administrator or its successors
without the prior written consent of the Collateral Manager and the Issuer,
provided that the Collateral Administrator shall remain directly liable to the
Issuer for the performance of its duties hereunder.

13. Bankruptcy Non-Petition and Limited Recourse. Notwithstanding any other
provision of this Agreement, the Collateral Administrator and the Collateral
Manager may not, prior to the date which is one year and one day (or, if longer,
the then applicable preference period plus one day) after the payment in full of
all the Class A Notes, institute against, or join any other Person in
instituting against, the Issuer, any bankruptcy, reorganization, arrangement,
insolvency, moratorium or liquidation proceedings, or other proceedings under
United States federal or state bankruptcy laws, or any similar laws; provided,
however, that nothing in this agreement by the Collateral Manager, the
Collateral Administrator or the Issuer (i) shall preclude, or be deemed to
estop, the Collateral Manager or the Collateral Administrator (A) from taking
any action prior to the expiration of the aforementioned one year plus one day
period (or if longer, the applicable preference period plus one day) in (x) any
case or proceeding voluntarily filed or commenced by the Issuer or (y) any
involuntary insolvency proceeding filed or commenced against the Issuer by a
Person other than the Collateral Manager or the Collateral Administrator or any
of their respective Affiliates or (B) from commencing against the Issuer or any
properties of the Issuer, any legal action which is not a bankruptcy,
reorganization, arrangement, insolvency, moratorium or liquidation proceeding.
The Issuer’s obligations hereunder will be solely the corporate obligations of
the Issuer, and the Collateral Administrator and the Collateral Manager will not
have any recourse to any of the directors, officers, employees, shareholders,
members, governors or Affiliates of the Issuer with respect to any claims,
losses, damages, liabilities, indemnities or other obligations in connection
with any transactions contemplated hereby. The obligations of the Issuer
hereunder shall be limited to the net proceeds of the Assets (if any), payable
solely in accordance with the order specified in the Priority of Payments under
the Indenture, and following realization of the Assets and the application of
their proceeds in accordance with the Priority of Payments under the Indenture,
any outstanding obligations of the Issuer hereunder, and any claims in respect
thereof, shall be extinguished and shall not thereafter revive. The provisions
of this Section 13 shall survive the termination of this Agreement.

14. Counterparts. This Agreement may be executed in any number of counterparts,
including by facsimile or other electronic means of communication, each of which
shall be deemed to be an original, but all of which together shall constitute
but one and the same instrument. Delivery of an executed counterpart of this
Agreement by e-mail (PDF) or telecopy shall be as effective as delivery of a
manually executed counterpart of this Agreement.

 

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15. Conflict with the Indenture. If this Agreement shall require that any action
be taken with respect to any matter and the Indenture shall require that, a
different action be taken with respect to such matter, and such actions shall be
mutually exclusive, or if this Agreement should otherwise conflict with the
Indenture, the Indenture shall govern.

16. Assignment of Issuer’s Rights. The parties hereto hereby acknowledge the
Issuer’s Grant pursuant to the Indenture of its right, title and interest in, to
and under this Agreement.

17. Jurisdiction. The parties hereto hereby irrevocably submit to the
non-exclusive jurisdiction of any New York State or Federal court sitting in the
Borough of Manhattan in The City of New York in any action or proceeding arising
out of or relating to this Agreement, and the parties hereto hereby irrevocably
agree that all claims in respect of such action or proceeding may be heard and
determined in such New York State or Federal court. The parties hereto hereby
irrevocably waive, to the fullest extent that they may legally do so, the
defense of an inconvenient forum to the maintenance of such action or
proceeding. The parties hereto hereby agree that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.

18. Waiver of Jury Trial Right. EACH PARTY HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT THAT IT MAY HAVE
TO A TRIAL BY JURY (BUT NO OTHER JUDICIAL REMEDIES) IN RESPECT OF ANY PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED
HEREBY. Each party hereby (i) certifies that no representative, agent or
attorney of the other has represented, expressly or otherwise, that the other
would not, in the event of such proceedings, seek to enforce the foregoing
waiver and (ii) acknowledges that it has been induced to enter into this
Agreement by, among other things, the mutual waivers and certifications in this
Section 18.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amended and Restated
Collateral Administration Agreement to be executed effective as of the day first
above written.

 

LOCUST STREET FUNDING LLC the Issuer By:  

/s/ Gerald F. Stahlecker

  Name: Gerald F. Stahlecker   Title: Executive Vice President

FS INVESTMENT CORPORATION

the Collateral Manager

By:  

/s/ Gerald F. Stahlecker

  Name: Gerald F. Stahlecker   Title: Executive Vice President

VIRTUS GROUP, LP

the Collateral Administrator

By:  

/s/ Terence Botha

  Name: Terence Botha   Title: Director

Amended and Restated Collateral Administration Agreement Signature Page