Document:

EX-10.3

 Exhibit 10.3 
 EXECUTION VERSION 
 SECURITY AGREEMENT 

dated as of 

May 14, 2014 

between 
 DUNNING
CREEK LLC, 
 as Borrower 
 and 
 DEUTSCHE BANK AG, NEW YORK BRANCH, 

as Administrative Agent 

 TABLE OF CONTENTS 

 

							
	 	 	 	  	Page	 
	 SECTION 1.
	 	Definitions	  	 	1	  
	 SECTION 2.
	 	Grant of Transaction Liens	  	 	4	  
	 SECTION 3.
	 	General Representations and Warranties	  	 	5	  
	 SECTION 4.
	 	Further Assurances; General Covenants	  	 	6	  
	 SECTION 5.
	 	Investment Property	  	 	8	  
	 SECTION 6.
	 	Deposit Accounts	  	 	8	  
	 SECTION 7.
	 	Bank Loans	  	 	9	  
	 SECTION 8.
	 	Operation of Collateral Accounts	  	 	9	  
	 SECTION 9.
	 	Right to Vote	  	 	10	  
	 SECTION 10.
	 	Remedies upon Event of Default	  	 	10	  
	 SECTION 11.
	 	Application of Proceeds	  	 	11	  
	 SECTION 12.
	 	Fees and Expenses; Indemnification	  	 	12	  
	 SECTION 13.
	 	Authority to Administer Collateral	  	 	13	  
	 SECTION 14.
	 	Limitation on Duty in Respect of Collateral	  	 	13	  
	 SECTION 15.
	 	General Provisions Concerning The Administrative Agent	  	 	14	  
	 SECTION 16.
	 	Termination of Transaction Liens; Release of Collateral	  	 	15	  
	 SECTION 17.
	 	Notices	  	 	15	  
	 SECTION 18.
	 	No Implied Waivers; Remedies Not Exclusive	  	 	15	  
	 SECTION 19.
	 	Successors and Assigns	  	 	15	  
	 SECTION 20.
	 	Amendments and Waivers	  	 	16	  
	 SECTION 21.
	 	Choice of Law	  	 	16	  
	 SECTION 22.
	 	Waiver of Jury Trial	  	 	16	  
	 SECTION 23.
	 	Severability	  	 	16	  

  
 i 

 EXHIBITS: 
  

	Exhibit A	Perfection Certificate 

  
 ii 

 SECURITY AGREEMENT 

This SECURITY AGREEMENT (this “Agreement”) dated as of May 14, 2014 between DUNNING CREEK LLC, as Borrower, and
DEUTSCHE BANK AG, NEW YORK BRANCH, as Administrative Agent. 
 RECITALS: 

The Borrower is entering into the Credit Agreement described in Section 1 hereof, pursuant to which the Borrower intends to borrow
funds for the purpose of investing on a leveraged basis in Fund Investments. 
 The Borrower is willing to secure, its
obligations to the Secured Parties under the Credit Documents, by granting Liens on its assets to the Administrative Agent for the ratable benefit of the Secured Parties as provided in the Collateral Documents; 

WHEREAS, the Lenders are not willing to make loans under the Credit Agreement unless the foregoing obligations of the Borrower are
secured as described above; 
 WHEREAS, upon any foreclosure or other enforcement of the Credit Documents, the net proceeds of
the Collateral are to be received by or paid over to the Administrative Agent and applied as provided herein; 
 NOW, THEREFORE,
in consideration of the foregoing and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 
 SECTION 1. Definitions. 
 (a) Terms Defined in Credit
Agreement. Terms defined in the Credit Agreement and not otherwise defined in subsection (b) or (c) of this Section 1 have, as used herein, the respective meanings provided for therein. 

(b) Terms Defined in UCC. As used herein, each of the following terms has the meaning specified in the UCC: 

 

					
	 Term
	  	 UCC
	  	 
	 Account
	  	9-102	  	
	 Authenticate
	  	9-102	  	
	 Chattel Paper
	  	9-102	  	
	 Deposit Account
	  	9-102	  	
	 Document
	  	9-102	  	
	 Entitlement Holder
	  	8-102	  	
	 Entitlement Order
	  	8-102	  	
	 Financial Asset
	  	8-102 & 103

			
	 Term
	  	 UCC

	 General Intangibles
	  	9-102
	 Instrument
	  	9-102
	 Investment Property
	  	9-102
	 Record
	  	9-102
	 Securities Account
	  	8-501
	 Securities Intermediary
	  	8-102
	 Security
	  	8-102 & 103
	 Security Entitlement
	  	8-102
	 Supporting Obligations
	  	9-102

 (c) Additional Definitions. The following additional terms, as used herein, have the following
meanings: 
 “Agreement” has the meaning set forth in the preamble. 

“Assignment Agreement” shall mean, with respect to any Bank Loan, an “Assignment and Acceptance Agreement,”
“Assignment and Assumption Agreement” or other assignment or transfer document in the form required under the terms of such Bank Loan to assign interests and/or obligations in respect of such Bank Loan or, if there is no required form, in
such form as is reasonably acceptable to the Administrative Agent. 
 “Cash Collateral Account” has the meaning
set forth in the Custodial Agreement. 
 “Cash Distributions” means dividends, interest and other distributions
and payments (including proceeds of liquidation, sale or other disposition) made or received in cash upon or with respect to any Collateral. 
 “Collateral” means all property, whether now owned or hereafter acquired, on which a Lien is granted or purports to be granted to the Administrative Agent pursuant to the Collateral
Documents, including the items specified in Section 2(a) below. 
 “Collateral Accounts” means the
Custodial Account, the Cash Collateral Account, the Administrative Expense Sub-account and any additional accounts or sub-accounts established by the Custodian pursuant
to the Custodial Agreement. 
 “Collateral Documents” means this Agreement, the Custodial Agreement and any
other supplemental or additional security agreements, control agreements, custodial agreements or similar instruments delivered pursuant to the Credit Documents. 
 “Control” has the following meanings: 
 (a) when
used with respect to any Security or Security Entitlement, the meaning specified in UCC Section 8-106; and 
 (b) when used with respect to any Deposit Account, the meaning specified in UCC Section 9-104. 

  
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 “Credit Agreement” means the Credit Agreement dated as of May 14, 2014
between Dunning Creek LLC, as borrower, and Deutsche Bank AG, New York Branch, as administrative agent and a lender, and each other lender party thereto from time to time, as amended. 

“Custodial Account” has the meaning set forth in the Custodial Agreement. 

“Notice of Exclusive Control” means a written notice that an Event of Default has occurred and is continuing and the
Secured Parties will exercise exclusive control over the Collateral Accounts substantially in the form of Exhibit A to the Custodial Agreement. 
 “Opinion of Counsel” means a written opinion of legal counsel (who may be counsel to the Borrower or other counsel, in either case approved by the Administrative Agent) addressed and
delivered to the Administrative Agent. 
 “own” refers to the possession of sufficient rights in property to
grant a security interest therein as contemplated by UCC Section 9-203, and “acquire” refers to the acquisition of any such rights. 

“Perfection Certificate” means a certificate substantially in the form of Exhibit A, completed and supplemented
with the schedules contemplated thereby to the satisfaction of the Administrative Agent, and signed by an Authorized Representative of the Borrower and a Responsible Officer of the Manager (which could be the same person as the Authorized
Representative). 
 “Pledged”, when used in conjunction with any type of asset, means at any time an asset of
such type that is included (or that creates rights that are included) in the Collateral at such time. For example, “Pledged Fund Investment” means a Fund Investment that is included in the Collateral at such time. 

“Post-Petition Interest” means any interest that accrues after the commencement
of any case, proceeding or other action relating to the bankruptcy, insolvency or reorganization of the Borrower (or would accrue but for the operation of applicable bankruptcy or insolvency laws), whether or not such interest is allowed or
allowable as a claim in any such proceeding. 
 “Proceeds” means all proceeds of, and all other profits,
products, rents or receipts, in whatever form, arising from the collection, sale, lease, exchange, assignment, licensing or other disposition of, or other realization upon, any Collateral, including all claims of the Borrower against third parties
for loss of, damage to or destruction of, or for proceeds payable under, or unearned premiums with respect to, policies of insurance in respect of, any Collateral, and any condemnation or requisition payments with respect to any Collateral.

 “Release Conditions” means the following conditions for terminating all the Transaction Liens: 

(i) the Commitments under the Credit Agreement shall have expired or been terminated; and 

(ii) all Secured Obligations shall have been paid in full. 

  
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 “Sale and Contribution Agreement” means the Sale and Contribution Agreement
dated as of May 14, 2014 between FS Investment Corporation II, as seller, and Dunning Creek LLC, as purchaser. 

“Secured Obligations” means all principal of all Loans outstanding from time to time under the Credit Agreement, all
interest (including Post-Petition Interest) on such Loans and all other amounts now or hereafter payable by the Borrower to the Secured Parties pursuant to the Credit Documents. 

“Secured Parties” means the Administrative Agent and the Lenders. 

“Transaction Liens” means the Liens granted by the Borrower under the Collateral Documents. 

“UCC” means the Uniform Commercial Code as in effect from time to time in the State of New York; provided
that, if perfection or the effect of perfection or non-perfection or the priority of any Transaction Lien on any Collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than
New York, “UCC” means the Uniform Commercial Code as in effect from time to time in such other jurisdiction for purposes of the provisions hereof relating to such perfection, effect of perfection or
non-perfection or priority. 
 (d) Terms Generally. The definitions of terms
herein (including those incorporated by reference to the UCC or to another document) apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun includes the corresponding masculine, feminine
and neuter forms. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The word “will” shall be
construed to have the same meaning and effect as the word “shall”. Unless the context requires otherwise, (i) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (ii) any reference herein to any
Person shall be construed to include such Person’s successors and assigns, (iii) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to
this Agreement in its entirety and not to any particular provision hereof, (iv) all references herein to Sections and Exhibits shall be construed to refer to Sections of, and Exhibits to, this Agreement and (v) the word
“property” shall be construed to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights. 
 SECTION 2. Grant of Transaction Liens. 
 (a) The Borrower, in order
to secure the Secured Obligations, grants to the Administrative Agent for the ratable benefit of the Secured Parties a continuing security interest in all the following property of the Borrower whether now owned or existing or hereafter acquired or
arising and regardless of where located: 
 (i) all Accounts; 

  
 -4-

 (ii) all Chattel Paper; 

(iii) all Deposit Accounts; 
 (iv) all Documents; 
 (v) all General Intangibles (including, all
right, title and interest of the Borrower in, to and under (1) all Bank Loans, (2) the Management Agreement, (3) the Custodial Agreement, and (4) the Sale and Contribution Agreement); 

(vi) all Instruments; 
 (vii) all Investment Property; 
 (viii) all books and records
(including documentation, credit files, computer programs, printouts and other computer materials and records) of the Borrower pertaining to any of the Collateral; 

(ix) (1) the Collateral Accounts, (2) all Financial Assets credited to the Collateral Accounts from time to
time and all Security Entitlements in respect thereof and (3) all Cash held in the Collateral Accounts from time to time; and 
 (x) all Proceeds of the Collateral described in the foregoing clauses (i) through (ix). 
 (b) With respect to each right to payment or performance included in the Collateral from time to time, the Transaction Lien granted therein includes a continuing security interest in (i) any
Supporting Obligation that supports such payment or performance and (ii) any Lien that (x) secures such right to payment or performance or (y) secures any such Supporting Obligation. 

(c) The Transaction Liens are granted as security only and shall not subject the Administrative Agent or any other Secured Party to, or
transfer or in any way affect or modify, any obligation or liability of the Borrower with respect to any of the Collateral or any transaction in connection therewith. 
 SECTION 3. General Representations and Warranties. The Borrower represents and warrants that: 
 (a) It has good and marketable title to all its Collateral, free and clear of any Lien other than Permitted Liens. 
 (b) It has not performed any acts that would reasonably be likely to prevent the Administrative Agent from enforcing any of the provisions of the Credit Documents or that would limit the Administrative
Agent in any such enforcement. No financing statement, security agreement, mortgage or similar or equivalent document or instrument covering all or part of the 

  
 -5-

 
Collateral owned by the Borrower is on file or of record in any jurisdiction in which such filing or recording would be effective to perfect or record a Lien on such Collateral. After the Closing
Date, no Collateral owned by the Borrower will be in the possession or under the Control of any other Person having a claim thereto or security interest therein, other than a Permitted Lien. 

(c) The Transaction Liens on all Collateral owned by the Borrower (i) have been validly created, (ii) will attach to each item
of such Collateral on the Closing Date (or, if the Borrower first obtains rights thereto on a later date, on such later date) and (iii) when so attached, will secure all the Secured Obligations. 

(d) It has delivered a Perfection Certificate to the Administrative Agent. The information set forth therein is correct and complete in
all material respects as of the Closing Date. 
 (e) When UCC financing statements describing the Collateral as “all
personal property” or “all assets” have been filed in the offices specified in such Perfection Certificate, the Transaction Liens will constitute perfected security interests in the Collateral owned by the Borrower to the extent that
a security interest therein may be perfected by filing pursuant to the UCC, prior to all Liens and rights of others therein other than any Permitted Lien. Except for the filing of such UCC financing statements, no registration, recordation or filing
with any governmental body, agency or official is required in connection with the execution or delivery of the Collateral Documents or is necessary for the validity or enforceability thereof or for the perfection or due recordation of the
Transaction Liens or for the enforcement of the Transaction Liens. 
 SECTION 4. Further Assurances; General
Covenants. The Borrower covenants as follows: 
 (a) It will, from time to time, at its own expense, execute, deliver, file
and record any statement, assignment, instrument, document, agreement or other paper and take any other action (including any filing of financing or continuation statements under the UCC) that from time to time may be reasonably necessary or
desirable, or that the Administrative Agent may reasonably request, in order to: 
 (i) create, preserve,
perfect, confirm or validate the Transaction Liens on the Collateral; 
 (ii) in the case of any Collateral
Account, cause the Administrative Agent to have Control thereof; 
 (iii) enable the Administrative Agent and the
other Secured Parties to obtain the full benefits of the Credit Documents; 
 (iv) enable the Administrative
Agent to exercise and enforce any of its rights, powers and remedies with respect to any of the Collateral (including, from time to time, duly execute and deliver to the Administrative Agent or the relevant assignee (as directed by the
Administrative Agent) such Assignment Agreements and other documents and instruments determined by the Administrative Agent to be reasonably necessary to effect or evidence any assignment, purchase or other transfer of Bank Loans as the
Administrative Agent may request). 

  
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 To the extent permitted by applicable law, the Borrower authorizes the Administrative Agent to
(A) execute and file such financing statements or continuation statements without the Borrower’s signature appearing thereon and, (B) upon the occurrence and during the continuance of an Event of Default, execute, deliver and
complete, and seek required consents in respect of, any Assignment Agreement delivered by the Borrower with respect to any Bank Loan pursuant to Section 7. The Borrower agrees that the Administrative Agent may utilize a carbon, photographic,
photostatic or other reproduction of this Agreement or of a financing statement as a financing statement. The Borrower constitutes the Administrative Agent its
attorney-in-fact to (1) execute and file all filings required or so requested for the foregoing purposes and, (2) upon the occurrence and during the
continuance of an Event of Default, execute, deliver and complete, and seek required consents in respect of, any Assignment Agreement delivered by the Borrower with respect to any Bank Loan, all acts of such attorney being hereby ratified and
confirmed; and such power, being coupled with an interest, shall be irrevocable until all the Transaction Liens granted by the Borrower terminate pursuant to Section 15. The Borrower will pay the costs of, or incidental to, any recording or
filing of any financing or continuation statements or other documents recorded or filed pursuant hereto. 
 (b) The Borrower
will not (i) change its name or corporate structure, (ii) change its location (determined as provided in UCC Section 9-307) or (iii) become bound, as provided in UCC Section 9-203(d) or otherwise, by a security agreement entered into by another Person, unless it shall have given the Administrative Agent prior notice thereof and delivered an Opinion of Counsel with respect
thereto in accordance with Section 4(c). 
 (c) At least 30 days before it takes any action contemplated by
Section 4(b), the Borrower will, at its own expense, cause to be delivered to the Administrative Agent an Opinion of Counsel, in form and substance satisfactory to the Administrative Agent, to the effect that (i) all financing statements
and amendments or supplements thereto, continuation statements and other documents required to be filed or recorded in order to perfect and protect the Transaction Liens against all creditors of and purchasers from the Borrower after it takes such
action (except any continuation statements specified in such Opinion of Counsel that are to be filed more than six months after the date thereof) have been filed or recorded in each office necessary for such purpose, (ii) all fees and taxes, if
any, payable in connection with such filings or recordations have been paid in full and (iii) except as otherwise agreed by the Administrative Agent, such action will not adversely affect the perfection or priority of the Transaction Lien on
any Collateral after it takes such action or the accuracy of the representations and warranties herein relating to such Collateral. 
 (d) It will notify the Administrative Agent as soon as it has knowledge or reasonable belief that the value of any Collateral has been or may be materially impaired (including as a result of a default or
event of default occurring with respect to any Collateral). 
 (e) It will, promptly upon request, provide to the Administrative
Agent all information and evidence concerning the Collateral that the Administrative Agent may reasonably request from time to time to enable it to enforce the provisions of the Collateral Documents. 

  
 -7-

 (f) It agrees that any financing statement may contain an indication or description of the
Collateral that describes such property in any manner as the Administrative Agent may determine, in its sole discretion, is necessary, advisable or prudent to ensure the perfection of the security interest in the Collateral granted to the
Administrative Agent herein, including describing such property as “all assets” or “all personal property”. 

SECTION 5. Investment Property. The Borrower represents, warrants and covenants to the Secured Parties as follows:

 (a) Securities and Security Entitlements. On or prior to the Closing Date, the Borrower will deliver or cause to be
delivered to the Custodian, in the manner specified in Section 5(c), all Securities, Security Entitlements and negotiable Instruments then owned by the Borrower, for credit by the Custodian to the Custodial Account. Thereafter, whenever the
Borrower acquires any other Security, Security Entitlement or negotiable Instrument, the Borrower will, as promptly as practicable, cause such Security, Security Entitlement or negotiable Instrument to be delivered to the Custodian, in the manner
specified in Section 5(c), for credit by the Custodian to the Custodial Account. 
 (b) Perfection as to Security
Entitlements. Upon the execution and delivery of the Custodial Agreement by the parties thereto, so long as any Financial Asset owned by the Borrower is credited to the Custodial Account, (i) the Transaction Lien on the Borrower’s
Security Entitlement in respect of such Financial Asset will be perfected, subject to no Liens or rights of others (except Permitted Liens), (ii) the Administrative Agent will have Control of such Security Entitlement and (iii) no action
based on an adverse claim to such Security Entitlement or such Financial Asset, whether framed in conversion, replevin, constructive trust, equitable lien or other theory, may be asserted against any Secured Party. 

(c) Delivery. All Securities, Security Entitlements and negotiable Instruments shall be delivered to the Custodian in the manner
specified in the definition of “delivery” under the Credit Agreement. 
 SECTION 6. Deposit Accounts.
The Borrower represents, warrants and covenants to the Secured Parties as follows: 
 (a) Deposit of Cash. On or prior to
the date of the Initial Loan, the Borrower will deposit or cause to be deposited in the Cash Collateral Account (or, to the extent permitted under Section 4.01(h) of the Credit Agreement, the Administrative Expense Sub-account) all Cash then owned by the Borrower. Thereafter, the Borrower will cause all Cash owned by Borrower from time to time, including all Cash Distributions received with respect to assets held in the
Collateral Accounts and all Proceeds of Collateral, to be deposited in the Cash Collateral Account, to be held and administered as provided under the Credit Documents. 

  
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 (b) Perfection as to Deposit Accounts. Upon the execution and delivery of the
Custodial Agreement by the parties thereto, (i) the Transaction Lien on the Cash Collateral Account and the Administrative Expense Sub-account will be perfected, subject to no Liens or rights of others
(except Permitted Liens) and (ii) the Administrative Agent will have Control of such Collateral Accounts. 
 SECTION
7. Bank Loans. The Borrower represents, warrants and covenants to the Secured Parties as follows: 
 (a) Delivery
of Assignment Agreements. On or prior to the Closing Date, the Borrower will deliver to the Custodian three Assignment Agreements in respect of each Bank Loan then owned by the Borrower, each undated and duly executed in blank by the Borrower as
assignor. Thereafter, promptly upon its acquisition of any interest in a Bank Loan, the Borrower will deliver to the Administrative Agent three Assignment Agreements in respect of such Bank Loan, each undated and duly executed in blank by the
Borrower as assignor. 
 (b) Delivery of Promissory Notes. On or prior to the Closing Date, in respect of each Bank Loan
owned by the Borrower that is evidenced by a promissory note, but excluding any Participation Interests, the Borrower will deliver the original of such promissory note to the Custodian, to be held by the Custodian as agent and bailee of the
Administrative Agent pursuant to the Custodial Agreement. Thereafter, promptly upon its acquisition of any interest in a Bank Loan that is evidenced by a promissory note, but excluding any Participation Interests, the Borrower will deliver the
original of such promissory note to the Custodian, to be held by the Custodian as agent and bailee of the Administrative Agent pursuant to the Custodial Agreement. 
 (c) Delivery of Participation Agreements. On or prior to the Closing Date, in respect of each Participation Interest owned by the Borrower, the Borrower will deliver a copy of the applicable
participation agreement to the Custodian, to be held by the Custodian as agent and bailee of the Administrative Agent pursuant to the Custodial Agreement. Thereafter, promptly upon its entry into any Participation Interest, the Borrower will deliver
a copy of the applicable participation agreement to the Custodian, to be held by the Custodian as agent and bailee of the Administrative Agent pursuant to the Custodial Agreement. 

SECTION 8. Operation of Collateral Accounts. 
 (a) If an Event of Default shall have occurred and is continuing, the Administrative Agent may (i) instruct the Custodian to retain all cash and investments then held in any Collateral Account,
(ii) instruct the Custodian to liquidate any or all investments held therein and/or (iii) withdraw any amounts held therein and apply such amounts as provided in Section 10. 

(b) If immediately available cash on deposit in any Collateral Account is not sufficient to make any distribution or withdrawal to be
made pursuant hereto, the Administrative Agent will cause to be liquidated, as promptly as practicable, such investments held in or credited to such Collateral Account as shall be required to obtain sufficient cash to make such distribution or
withdrawal and, notwithstanding any other provision hereof, such distribution or withdrawal shall not be made until such liquidation has taken place. 

  
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 SECTION 9. Right to Vote. (a) Unless an Event of Default shall have
occurred and is continuing, the Borrower will have the right, from time to time, to vote and to give consents, ratifications and waivers with respect to any Pledged Fund Investment or any other Collateral. 

(b) If an Event of Default shall have occurred and is continuing, the Administrative Agent will have the right to the extent permitted by
law to vote, to give consents, ratifications and waivers and to take any other action with respect to the Pledged Fund Investments, with the same force and effect as if the Administrative Agent were the absolute and sole owner thereof, and the
Borrower will take all such action as the Administrative Agent may reasonably request from time to time to give effect to such right. 
 SECTION 10. Remedies upon Event of Default. (a) If an Event of Default shall have occurred and is continuing (for the avoidance of doubt, upon commencement by the Administrative Agent
of any of the remedies set forth herein or in any of the other Credit Documents or upon notice by the Administrative Agent to the Borrower or the Manager that it intends to promptly commence the exercise of any such remedies, such Event of Default
shall be deemed to be continuing, and may not be cured or curable by any subsequent actions or events), the Administrative Agent may exercise (or cause its sub-agents to exercise) any or all of the remedies
available to it (or to such sub-agents) under the Credit Documents. 
 (b) Without
limiting the generality of the foregoing, if an Event of Default shall have occurred and is continuing, the Administrative Agent may exercise all the rights of a secured party under the UCC (whether or not in effect in the jurisdiction where such
rights are exercised) with respect to any Collateral. In addition, the Administrative Agent may deliver a Notice of Exclusive Control to the Custodian and, thereafter, without being required to give any notice, except as herein provided or as may be
required by mandatory provisions of law, withdraw all cash held in the Collateral Accounts and apply such cash as provided in Section 11 and, if there shall be no such cash or if such cash shall be insufficient to pay all the Secured
Obligations in full, sell, lease, license or otherwise dispose of the Collateral or any part thereof at such place or places as the Administrative Agent deems best, and for cash, credit or any combination thereof or for future delivery, at public or
private sale, without demand of performance to effect any such disposition or of the time or place thereof, and the Administrative Agent or any one else may be the purchaser, lessee, assignee or recipient of any or all of the Collateral so disposed
of at any public sale (or, to the extent permitted by law, at any private sale) and thereafter hold the same absolutely, free from any claim or right of whatsoever kind, including any right or equity of redemption (statutory or otherwise) of the
Borrower, any such demand, right or equity being hereby expressly waived and released. The Borrower hereby agrees that in the case of any Collateral that is a Bank Loan, the Administrative Agent may effect any such disposition by selling such Bank
Loan in a private sale in which the Administrative Agent is the purchaser followed by a sale by the Administrative Agent of participations in such Bank Loan to one or more third parties (who may be affiliates of a Secured Party), and that such
manner of disposition shall be deemed to be commercially reasonable. The Borrower shall remain liable to the Secured Parties for any deficiency following any such sale of Collateral. In addition to the foregoing remedies, the Administrative Agent
may take any action that is necessary in Administrative Agent’s sole good faith discretion to protect, preserve or enforce its rights hereunder or to reduce any risk of loss that it may suffer. 

  
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 (c) The Administrative Agent may adjourn any public or private sale or cause the same to be
adjourned from time to time by announcement at the time and place fixed for the sale, and such sale may be made at any time or place to which the sale may be so adjourned. Notice of any such sale or other disposition shall be given to the Borrower
to the extent required by Section 13 and by applicable law. If so requested by the Administrative Agent or by any buyer of the Collateral or any part thereof, the Borrower shall further ratify and confirm any action taken pursuant to the power
of attorney granted herein by executing and delivering to the Administrative Agent or to such buyer or buyers at the expense of the Borrower all instruments of assignment, conveyance or transfer, releases, instructions and entitlement orders as may
be designated in any such request. 
 (d) Neither the Administrative Agent nor any Secured Party shall incur any liability as a
result of the sale of the Collateral, or any part thereof, at any private sale pursuant to this Section 10 conducted in a commercially reasonable manner. The Borrower hereby waives any claims against the Administrative Agent and the Secured
Parties arising by reason of the fact that the price at which the Collateral may have been sold at such a private sale was less than the price that might have been obtained at a public sale, even if the Administrative Agent accepts the first offer
received and does not offer the Collateral to more than one offeree. 
 (e) Without limiting the generality of the foregoing, if
an Event of Default shall have occurred and is continuing, the Borrower, if directed by the Administrative Agent (acting with the consent of the Lenders), shall terminate the Management Agreement and replace the Manager with an institution selected
by the Borrower and approved by the Administrative Agent and the Lenders that is legally qualified, permitted under applicable law and with the capacity to assume the responsibilities, duties and obligations of the Manager under the Credit Documents
and the Management Agreement. 
 (f) Notwithstanding anything to the contrary contained herein, none of the rights of the
Administrative Agent specifically identified herein are intended to limit the rights of the Administrative Agent or any other Secured Party under the Credit Documents. 
 SECTION 11. Application of Proceeds. If an Event of Default shall have occurred and is continuing, the Administrative Agent shall apply (i) any Cash held in the Collateral Accounts and
(ii) the Proceeds of any sale or other disposition of all or any part of the Collateral, in the following order of priority: 
 first, to pay the expenses of such sale or other disposition, including reasonable compensation to agents of and counsel for the Administrative Agent, and all expenses, liabilities and advances
incurred or made by the Administrative Agent in connection with the Credit Documents, and any other amounts then due and payable to the Administrative Agent pursuant to Section 12 of this Agreement or Section 9.01 of the Credit Agreement;

  
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 second, to pay ratably all interest (including Post-Petition Interest) on the Secured Obligations payable under the Credit Agreement, until payment in full of all such interest and fees shall have been made; 

third, to pay the unpaid principal of the Secured Obligations ratably, until payment in full of the principal of
all Secured Obligations shall have been made (or so provided for); 
 fourth, to pay all other Secured
Obligations ratably, until payment in full of all such other Secured Obligations shall have been made (or so provided for); and 
 finally, to pay to the Borrower, or as a court of competent jurisdiction may direct, any surplus then remaining from such Cash or the Proceeds of the Collateral; 

The Administrative Agent may make such distributions hereunder in cash or in kind or, on a ratable basis, in any combination thereof. 

SECTION 12. Fees and Expenses; Indemnification. (a) The Borrower will forthwith upon demand pay to the Administrative
Agent: 
 (i) the amount of any taxes that the Administrative Agent may have been required to pay by reason of
the Transaction Liens or to free any Collateral from any other Lien thereon; 
 (ii) the amount of any and all
reasonable out-of-pocket expenses, including transfer taxes and reasonable fees and expenses of counsel and other experts, that the Administrative Agent may incur in
connection with (x) the administration or enforcement of the Credit Documents, including such expenses as are incurred to preserve the value of the Collateral or the validity, perfection, rank or value of any Transaction Lien, (y) the
collection, sale or other disposition of any Collateral or (z) the exercise by the Administrative Agent of any of its rights or powers under the Credit Documents; 

(iii) the amount of any fees that the Borrower shall have agreed in writing to pay to the Administrative Agent and that
shall have become due and payable in accordance with such written agreement; and 
 (iv) the amount required to
indemnify the Administrative Agent and each Lender for, or hold it harmless and defend it against, any loss, liability or expense (including the reasonable fees and expenses of its counsel and any experts or
sub-agents appointed by it hereunder) incurred or suffered by the Administrative Agent or any Lender in connection with the Credit Documents, except to the extent that such loss, liability or expense directly
and primarily arises from Administrative Agent’s or such Lender’s gross negligence or willful misconduct or a breach of any duty that the Administrative Agent or such Lender has under this Agreement (after giving effect to
Section 14). 

  
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 Any such amount not paid to the Administrative Agent or the applicable Lender on demand will bear interest
for each day thereafter until paid at a rate per annum equal to the Weighted Average Rate in effect from time to time plus the Applicable Margin plus 2%. 
 (b) If any transfer tax, documentary stamp tax or other tax is payable in connection with any transfer or other transaction provided for in the Collateral Documents, the Borrower will pay such tax and
provide any required tax stamps to the Administrative Agent or any Lender or as otherwise required by law. 
 SECTION 13.
Authority to Administer Collateral. The Borrower irrevocably appoints the Administrative Agent its true and lawful attorney, with full power of substitution, in the name of the Borrower or otherwise, for the sole use and benefit of the
Secured Parties, but at the Borrower’s expense, to the extent permitted by law to exercise, at any time and from time to time following the occurrence and continuance of an Event of Default, all or any of the following powers with respect to
all or any of the Collateral: 
 (a) to demand, sue for, collect, receive and give acquittance for any and all monies due or to
become due upon or by virtue thereof, 
 (b) to settle, compromise, compound, prosecute or defend any action or proceeding with
respect thereto, 
 (c) to sell, lease, license or otherwise dispose of the same or the proceeds or avails thereof, as fully and
effectually as if the Administrative Agent were the absolute owner thereof, 
 (d) to extend the time of payment of any or all
thereof and to make any allowance or other adjustment with reference thereto, 
 provided that, except in the case of Collateral that
threatens to decline speedily in value or is of a type customarily sold on a recognized market, the Administrative Agent will give the Borrower prior written notice of the time and place of any public sale thereof or the time after which any private
sale or other intended disposition thereof will be made (which the parties agree may be less than ten (10) days prior thereto); provided that, if no notice of such action is required under the UCC, then the Borrower agrees that no such notice
shall be required hereunder. Any such notice shall (i) contain the information specified in UCC Section 9-613, (ii) be Authenticated and (iii) be sent to the parties required to be notified
pursuant to UCC Section 9-611(c); provided that, if the Administrative Agent fails to comply with this sentence in any respect, its liability for such failure shall be limited to the
liability (if any) imposed on it as a matter of law under the UCC. 

  
 -13-

 SECTION 14. Limitation on Duty in Respect of Collateral. Beyond the exercise
of reasonable care in the custody and preservation thereof, the Administrative Agent will have no duty as to any Collateral in its possession or control or in the possession or control of any sub-agent or
bailee or any income therefrom or as to the preservation of rights against prior parties or any other rights pertaining thereto. The Administrative Agent will be deemed to have exercised reasonable care in the custody and preservation of the
Collateral in its possession or control if such Collateral is accorded treatment substantially equal to that which it accords its own property, and will not be liable or responsible for any loss or damage to any Collateral, or for any diminution in
the value thereof, by reason of any act or omission of any sub-agent or bailee selected by the Administrative Agent in good faith, except to the extent that such liability arises directly and primarily from
the Administrative Agent’s gross negligence or willful misconduct. 
 SECTION 15. General Provisions Concerning
The Administrative Agent. 
 (a) The provisions of Article 8 of the Credit Agreement shall inure to the benefit of the
Administrative Agent, and shall be binding upon the Borrower and all Secured Parties, in connection with this Agreement and the other Collateral Documents. Without limiting the generality of the foregoing, (i) the Administrative Agent shall not
be subject to any fiduciary or other implied duties, regardless of whether an Event of Default has occurred and is continuing, (ii) the Administrative Agent shall not have any duty to take any discretionary action or exercise any discretionary
powers, except discretionary rights and powers expressly contemplated by the Credit Documents that the Administrative Agent is required in writing to exercise by the Required Lenders (or such other number or percentage of the Lenders as shall be
necessary under the circumstances as provided in Section 9.13 of the Credit Agreement), and (iii) except as expressly set forth in the Credit Documents, the Administrative Agent shall not have any duty to disclose, and shall not be liable
for any failure to disclose, any information relating to the Borrower that is communicated to or obtained by the bank serving as Administrative Agent or any of its Affiliates in any capacity. The Administrative Agent shall not be responsible for the
existence, genuineness or value of any Collateral or for the validity, perfection, priority or enforceability of any Transaction Lien, whether impaired by operation of law or by reason of any action or omission to act on its part under the
Collateral Documents. The Administrative Agent shall be deemed not to have knowledge of any Event of Default unless and until written notice thereof is given to the Administrative Agent by the Borrower or a Secured Party. 

(b) Sub-Agents and Related Parties. The Administrative Agent may perform any of its duties and exercise any of its rights and
powers through one or more sub-agents appointed by it. The Administrative Agent and any such subagent may perform any of its duties and exercise any of its rights and powers through its Related Parties. The exculpatory provisions of Section 14
and this Section shall apply to any such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent. 
 (c) Information as to Secured Obligations and Actions by Secured Parties. For all purposes of the Credit Documents, including determining the amounts of the Secured Obligations or whether any
action has been taken under any Collateral Document, the Administrative Agent will be entitled to rely on information from (i) its own records for information as to the Secured Parties, their Secured Obligations and actions taken by them,
(ii) any Secured Party for information as to its Secured Obligations and actions taken by it, to the extent that the Administrative Agent has not obtained such information from its own records, and (iii) the Borrower, to the extent that
the Administrative Agent has not obtained information from the foregoing sources. 

  
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 (d) Refusal to Act. The Administrative Agent may refuse to act on any notice,
consent, direction or instruction from any Secured Party or any agent, trustee or similar representative thereof that, in the Administrative Agent’s opinion, (i) is contrary to law or the provisions of any Collateral Document,
(ii) may expose the Administrative Agent to liability (unless the Administrative Agent shall have been indemnified, to its reasonable satisfaction, for such liability by the Secured Parties that gave such notice, consent, direction or
instruction) or (iii) is unduly prejudicial to Secured Parties not joining in such notice, consent, direction or instruction. 
 SECTION 16. Termination of Transaction Liens; Release of Collateral. 

(a) The Transaction Liens shall terminate when the Administrative Agent has determined that all the Release Conditions have been
satisfied. 
 (b) At any time before the Transaction Liens terminate, the Administrative Agent may, at the written request of
the Borrower, elect to release any Collateral in its sole and absolute discretion. 
 (c) Upon any sale of a Fund Investment or
any other Collateral in accordance with the terms of the Credit Agreement, the Transaction Lien thereon shall automatically terminate, without any action by the Borrower or the Administrative Agent. 

(d) Upon any termination of a Transaction Lien or release of Collateral, the Administrative Agent will, at the Borrower’s expense,
execute and deliver to the Borrower such documents as the Borrower shall reasonably request to evidence the termination of such Transaction Lien or the release of such Collateral, as the case may be. 

SECTION 17. Notices. Each notice, request or other communication given to any party hereunder shall be given in accordance
with Section 9.03 of the Credit Agreement. 
 SECTION 18. No Implied Waivers; Remedies Not Exclusive. No
failure by the Administrative Agent or any Secured Party to exercise, and no delay in exercising and no course of dealing with respect to, any right or remedy under any Credit Document shall operate as a waiver thereof; nor shall any single or
partial exercise by the Administrative Agent or any Secured Party of any right or remedy under any Credit Document preclude any other or further exercise thereof or the exercise of any other right or remedy. The rights and remedies specified in the
Credit Documents are cumulative and are not exclusive of any other rights or remedies provided by law. 
 SECTION 19.
Successors and Assigns. This Agreement is for the benefit of the Administrative Agent and the other Secured Parties. If all or any part of any Secured Party’s interest in any Secured Obligation is assigned or otherwise transferred in
accordance with Section 9.05 of the Credit Agreement, the transferor’s rights hereunder, to the extent applicable to the obligation so transferred, shall be automatically transferred with such obligation. This Agreement shall be binding on
the Borrower and its successors and assigns. 

  
 -15-

 SECTION 20. Amendments and Waivers. Neither this Agreement nor any provision
hereof may be waived, amended, modified or terminated except pursuant to an agreement or agreements in writing entered into by the Administrative Agent, with the consent of such Lenders as are required to consent thereto under Section 9.13 of
the Credit Agreement. No such waiver, amendment or modification shall be binding upon the Borrower, except with its written consent. 
 SECTION 21. Choice of Law. This Agreement shall be construed in accordance with and governed by the laws of the State of New York, except as otherwise required by mandatory provisions
of law and except to the extent that remedies provided by the laws of any jurisdiction other than the State of New York are governed by the laws of such jurisdiction. 
 SECTION 22. Waiver of Jury Trial. EACH PARTY HERETO WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR
INDIRECTLY ARISING OUT OF OR RELATING TO ANY COLLATERAL DOCUMENT OR ANY TRANSACTION CONTEMPLATED THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO
THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION. 
 SECTION 23.
Severability. If any provision of any Credit Document is invalid or unenforceable in any jurisdiction, then, to the fullest extent permitted by law, (i) the other provisions of the Credit Documents shall remain in full force and effect
in such jurisdiction and shall be liberally construed in favor of the Secured Parties in order to carry out the intentions of the parties thereto as nearly as may be possible and (ii) the invalidity or unenforceability of such provision in such
jurisdiction shall not affect the validity or enforceability thereof in any other jurisdiction. 
 [Signatures begin on the next
page] 

  
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 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by
their respective authorized officers as of the day and year first above written. 
  

			
	DUNNING CREEK LLC, as Borrower
		
	By:	 	/s/ Gerald F. Stahlecker
		 	Name: Gerald F. Stahlecker
		 	Title: Executive Vice President

  

			
	DEUTSCHE BANK AG, NEW YORK BRANCH, as Administrative Agent
		
	 By:
	 	/s/ Ian R. Jackson
		 	Name: Ian R. Jackson
		 	Title: Director

  

			
	 By:
	 	/s/ Satish Ramakrishna
		 	Name: Satish Ramakrishna
		 	Title: Managing Director

 [Signature page to Security Agreement]EX-10.4

 Exhibit 10.4 
 SALE AND CONTRIBUTION AGREEMENT 
 between 

FS INVESTMENT CORPORATION II, 
 as Seller 
 and 

DUNNING CREEK LLC, 
 as Purchaser 
 Dated as of May 14, 2014 

 TABLE OF CONTENTS 

 

							
	 	  	 	  	Page	 
	 ARTICLE I DEFINITIONS
	  	 	1	  
	 SECTION 1.1
	  	Definitions	  	 	1	  
	 SECTION 1.2
	  	Other Terms	  	 	5	  
	 SECTION 1.3
	  	Computation of Time Periods	  	 	5	  
		
	 ARTICLE II CONVEYANCES OF TRANSFERRED ASSETS
	  	 	5	  
	 SECTION 2.1
	  	Conveyances	  	 	5	  
	 SECTION 2.2
	  	Indemnification	  	 	7	  
		
	 ARTICLE III CONSIDERATION AND PAYMENT; REPORTING
	  	 	7	  
	 SECTION 3.1
	  	Purchase Price	  	 	7	  
	 SECTION 3.2
	  	Payment of Purchase Price	  	 	7	  
		
	 ARTICLE IV REPRESENTATIONS AND WARRANTIES
	  	 	7	  
	 SECTION 4.1
	  	Seller’s Representations and Warranties	  	 	7	  
	 SECTION 4.2
	  	Reaffirmation of Representations and Warranties by the Seller; Notice of Breach	  	 	12	  
		
	 ARTICLE V COVENANTS OF THE SELLER
	  	 	13	  
	 SECTION 5.1
	  	Covenants of the Seller	  	 	13	  
		
	 ARTICLE VI WARRANTY LOANS
	  	 	15	  
	 SECTION 6.1
	  	Warranty Collateral Obligations	  	 	15	  
	 SECTION 6.2
	  	Dilutions, Etc.	  	 	15	  
		
	 ARTICLE VII CONDITIONS PRECEDENT
	  	 	16	  
	 SECTION 7.1
	  	Conditions Precedent	  	 	16	  
		
	 ARTICLE VIII MISCELLANEOUS PROVISIONS
	  	 	16	  
	 SECTION 8.1
	  	Amendments, Etc.	  	 	16	  
	 SECTION 8.2
	  	Governing Law: Submission to Jurisdiction	  	 	16	  
	 SECTION 8.3
	  	Notices	  	 	17	  

  
 -i-

							
	 SECTION 8.4
	  	Severability of Provisions	  	 	18	  
	 SECTION 8.5
	  	Further Assurances	  	 	18	  
	 SECTION 8.6
	  	No Waiver; Cumulative Remedies	  	 	18	  
	 SECTION 8.7
	  	Counterparts	  	 	18	  
	 SECTION 8.8
	  	Binding Effect; Third-Party Beneficiaries	  	 	18	  
	 SECTION 8.9
	  	Merger and Integration	  	 	19	  
	 SECTION 8.10
	  	Headings	  	 	19	  

  
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 This SALE AND CONTRIBUTION AGREEMENT, dated as of May 14, 2014 (as amended,
supplemented or otherwise modified and in effect from time to time, this “Agreement”), between FS Investment Corporation II, a Maryland corporation, as seller (in such capacity, the “Seller”) and Dunning Creek LLC,
a Delaware limited liability company, as purchaser (in such capacity, the “Purchaser”). 

W I T N E S S E T H:

 WHEREAS, the Purchaser desires to purchase certain loans and related assets existing on the Closing Date and from time to
time thereafter; 
 WHEREAS, the Seller may also wish to contribute certain loans and related contracts to the capital of the
Purchaser on the Closing Date and from time to time on each Purchase Date; 
 WHEREAS, the Seller desires to sell, assign and
contribute such loans and related contracts to the Purchaser upon the terms and conditions hereinafter set forth; 
 NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, it is hereby agreed by and between the Purchaser and the Seller as follows: 

ARTICLE I 

DEFINITIONS 
 SECTION 1.1 Definitions. As used in this Agreement, the following terms shall have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms
defined). All capitalized terms used herein but not defined herein shall have the respective meanings specified in, or incorporated by reference into, the Credit Agreement, dated as of the date hereof (as amended, supplemented or otherwise modified
and in effect from time to time, the “Credit Agreement”), by and among the Purchaser, as borrower, Deutsche Bank AG, New York Branch, as administrative agent and lender, and other lenders party thereto from time to time. 

“Agreement” has the meaning set forth in the preamble hereto. 

“Collateral Obligations” means any commercial loan, bond or note or participation interest therein owned by the
Purchaser, excluding the Retained Interest thereon. 
 “Convey” means to sell, transfer, assign, contribute or
otherwise convey assets hereunder. 

  
 -1-

 “Conveyance” means, as the context may require, the Initial Conveyance or a
Subsequent Conveyance. 
 “Indorsement” has the meaning specified in Section 8-102(a)(11) of the UCC, and
“Indorsed” has a corresponding meaning. 
 “Initial Conveyance” has the meaning set forth in
Section 2.1(a). 
 “Obligor” means, for any Collateral Obligation, the borrower thereunder or the
issuer thereof. 
 “Payment Date” means each Subsequent Conveyance Date and the date of the Initial Conveyance.

 “Purchase Date” has the meaning set forth in Section 2.1(b). 

“Purchase Notice” has the meaning set forth in Section 2.1(b). 

“Purchase Price” has the meaning set forth in Section 3.1. 

“Purchaser” has the meaning set forth in the preamble hereto. 

“Related Security” means, with respect to each Collateral Obligation: 

(a) any property or other assets designated and pledged or mortgaged as collateral to secure repayment of a Collateral
Obligation (including, without limitation, any pledge of the stock, membership or other ownership interests in the related Obligor or its subsidiaries, all equity purchase warrants or similar rights convertible into or exchangeable or exercisable
for any equity interests received by the Purchaser as an “equity kicker” from the Obligor in connection with such Collateral Obligation and all proceeds from any sale or other disposition of such property or other assets), all payments
paid in respect thereof and all monies due, to become due and paid in respect thereof accruing after the applicable transfer date and all liquidation proceeds thereof; 

(b) all guaranties, indemnities and warranties, insurance policies, financing statements and other agreements or
arrangements of whatever character from time to time supporting or securing payment of any such indebtedness; 

(c) the sum of all interest collections and all principal collections received with respect to any Conveyance with respect
to such Collateral Obligation and any of the foregoing; 
 (d) any guarantees or similar credit enhancement for
an Obligor’s obligations under any Collateral Obligation, all UCC financing statements or other filings relating thereto, including all rights and remedies, if any, against any Related Security, including all amounts due and to become due to
the Purchaser thereunder and all rights, remedies, powers, privileges and claims of the Purchaser thereunder (whether arising pursuant to the terms of such agreement or otherwise available to the Purchaser at law or in equity); 

  
 -2-

 (e) with respect to such Collateral Obligation and any of the foregoing:
(i) if such Collateral Obligation includes a promissory note, an original, executed copy of a promissory note or a copy of an executed promissory note (in the case of a lost promissory note) accompanied by an original executed affidavit and
indemnity endorsed by the Purchaser in blank, in each case with an unbroken chain of endorsements from each prior holder of such promissory note to the Purchaser or in blank (unless such note is in bearer form, in which case delivery alone shall
suffice), or in the case of a noteless Collateral Obligation, a copy of each executed document or instrument evidencing the assignment of such Collateral Obligation to the Purchaser, (ii) copies of any related loan agreement, security
agreement, mortgage, moveable or immoveable hypothec, deed of hypothec, guarantees, note purchase agreement, intercreditor and/or subordination agreement, each to the extent in the possession of the Purchaser, (iii) copies of the file-stamped (or the electronic equivalent of) UCC financing statements and continuation statements (including amendments or modifications thereof) authorized by the Obligor thereof or by another Person on the
Obligor’s behalf in respect of such Collateral Obligation, and (iv) all other documents, books, records and other information prepared and maintained by or on behalf of the Purchaser with respect to any Collateral Obligation and the
Obligors thereunder, including all documents, books, records and other information prepared and maintained by the Purchaser or the Manager with respect to such Collateral Obligation or Obligors; and 

(f) all recoveries and proceeds of the foregoing. 

“Repurchase Amount” means, for any Warranty Collateral Obligation for which a payment or substitution is being made
pursuant to Section 6.1 as of any time of determination, the sum of (i) the greater of (a) an amount equal to the purchase price paid by the Purchaser for such Collateral Obligation (excluding purchased accrued interest and original
issue discount) less all payments of principal received in connection with such Collateral Obligation since the date it was added to the Collateral and (b) the product of (I) the Market Value (determined as described in Section 4 of
Annex II to the Credit Agreement (treating any Warranty Collateral Obligation that is not Cash or a Cash Equivalent as a Fund Investment solely for purposes of this definition, regardless of whether it would qualify as a “Fund Investment”
under the definition thereof)) of such Warranty Collateral Obligation and (II) one minus the Margin Requirement for such Collateral Obligation (or, in the case of a Warranty Collateral Obligation that is not an Eligible Investment, the Margin
Requirement that would be applicable to such Warranty Collateral Obligation if it were an Eligible Investment), and (ii) any accrued and unpaid interest thereon that has not been paid into the Custodial Account. 

  
 -3-

 “Repurchase Event” means, with respect to any Transferred Collateral
Obligation, the occurrence of any of the following: 
 (a) the related Conveyance becomes or may become voidable
or subject to avoidance under Title 11 of the Bankruptcy Code and the rules and regulations thereunder; 
 (b)
the Seller has actual knowledge or is notified of any event which, as of the date of the related Conveyance had occurred and was continuing, could reasonably have been expected to affect the collectibility of such Transferred Collateral Obligation
or cause it not to be paid in full; or 
 (c) such Transferred Collateral Obligation (or any portion thereof
after giving effect to any contribution) was sold by the Seller to the Purchaser other than pursuant to a “true sale”. 
 “Retained Economic Interest” has the meaning set forth in Section 5.1(l)(i). 
 “Retained Interest” means, with respect to any Collateral Obligation included in any Conveyance, (a) such obligations to provide additional funding with respect to such Collateral
Obligation that have been retained by the other lender(s) of such Collateral Obligation, (b) all of the rights and obligations, if any, of the agent(s) under the underlying instruments, (c) any unused commitment fees associated with the
additional funding obligations that are being retained in accordance with clause (a) above, and (d) any agency or similar fees associated with the rights and obligations of the agent(s) that are being retained in accordance with clause
(b) above. 
 “Retention Requirements” means Part 5 of the EU Capital Requirements Regulation (Regulation
(EU) 575/2013), together with any guidelines, regulatory technical standards, implementing technical standards or related documents published from time to time in relation thereto by the European Banking Authority (or any predecessor or successor
agency or authority) and the European Commission, together with each other amendment or modification thereto approved by the parties hereto for purposes of this definition, each to the extent legally binding in the Member State of a Lender and in
each case as determined or imposed by any regulatory body having supervisory authority over any Lender. 
 “Schedule of
Collateral Obligations” has the meaning set forth in Section 2.1(a). 
 “Secured Parties”
means the Administrative Agent and the Lenders. 
 “Seller” has the meaning set forth in the preamble hereto.

 “Subsequent Conveyance” has the meaning set forth in Section 2.1(b). 

“Subsequent Conveyance Date” has the meaning set forth in Section 2.1(b). 

“Transferred Assets” means, collectively, the Transferred Collateral Obligations and Related Security Conveyed by the
Seller to the Purchaser hereunder. 
 “Transferred Collateral Obligations” means each Collateral Obligation
Conveyed from the Seller to the Purchaser pursuant to the terms of this Agreement. 

  
 -4-

 “Warranty Collateral Obligations” has the meaning set forth in
Section 6.1. 
 SECTION 1.2 Other Terms. All accounting terms not specifically defined herein shall be
construed in accordance with generally accepted accounting principles. All terms used in Article 9 of the UCC, and not specifically defined herein, are used herein as defined in such Article 9. The term “including” when used in this
Agreement means “including without limitation.” 
 SECTION 1.3 Computation of Time Periods. Unless otherwise
stated in this Agreement, in the computation of a period of time from a specified date to a later specified date, the word “from” means “from and including” and the words “to” and “until” each means “to
but excluding.” 
 ARTICLE II 
 CONVEYANCES OF TRANSFERRED ASSETS 
 SECTION 2.1
Conveyances. 
 (a) On the terms and subject to the conditions set forth in this Agreement, the Seller agrees to Convey
to the Purchaser on the Closing Date, and the Purchaser agrees to purchase from the Seller on the Closing Date (the “Initial Conveyance”), all of the Seller’s right, title and interest in and to each Collateral Obligation
listed on Schedule A to this Agreement (as such schedule may be amended, supplemented, updated or otherwise modified from time to time, the “Schedule of Collateral Obligations”) (the Schedule of Collateral Obligations,
as amended, supplemented, updated or otherwise modified shall become part of the Schedule of Collateral Obligations), together with all other Related Security and all proceeds of the foregoing but excluding the Retained Interests (if any) for such
Collateral Obligation. 
 (b) In the event the Purchaser agrees, from time to time after the Effective Date, to acquire
additional Collateral Obligations (including Related Security) from the Seller, the Purchaser shall deliver written notice thereof to the Administrative Agent substantially in the form set forth in Schedule B hereto (each, a “Purchase
Notice”), designating the date of the proposed Conveyance (a “Subsequent Conveyance Date” or a “Purchase Date”) and attaching a supplement to the Schedule of Collateral Obligations identifying the
Transferred Assets proposed to be Conveyed. On the terms and subject to the conditions set forth in this Agreement and the Credit Agreement, the Seller shall Convey to the Purchaser, and the Purchaser shall purchase, on the applicable Subsequent
Conveyance Date (each such purchase and sale being herein called a “Subsequent Conveyance”), all of the Seller’s right, title and interest in and to each Collateral Obligation then reported by the Seller on the Schedule of
Collateral Obligations attached to the related Purchase Notice, together with all other Related Security and all proceeds of the foregoing but excluding the Retained Interests (if any) for such Collateral Obligation. 

(c) It is the express intent of the Seller and the Purchaser that each Conveyance of Transferred Assets by the Seller to the Purchaser
pursuant to this Agreement be construed as an absolute sale and/or contribution of such Transferred Assets by the Seller to the Purchaser. Further, it is not the intention of the Seller and the Purchaser that any purchase be

  
 -5-

 
deemed a grant of a security interest in the Transferred Assets by the Seller to the Purchaser to secure a debt or other obligation of the Seller. However, in the event that, notwithstanding the
intent of the parties, the Conveyances hereunder shall be characterized as loans and not as sales and/or contributions, then (i) this Agreement also shall be deemed to be, and hereby is, a security agreement within the meaning of the UCC and
other applicable law and (ii) the Conveyances by the Seller provided for in this Agreement shall be deemed to be, and the Seller hereby grants to the Purchaser, a security interest in, to and under all of the Seller’s right, title and
interest in, to and under, whether now owned or hereafter acquired, such Transferred Assets and all proceeds of the foregoing. The Purchaser and its assignees shall have, with respect to such Transferred Assets and other related rights, in addition
to all the other rights and remedies available to the Purchaser and its assignees and under the other Transaction Documents, all the rights and remedies of a secured party under any applicable UCC. 

The Seller and the Purchaser shall, to the extent consistent with this Agreement, take such actions as may be necessary to ensure that,
if this Agreement were deemed to create a security interest in the Transferred Assets to secure a debt or other obligation, such security interest would be deemed to be a perfected security interest in favor of the Purchaser under applicable law and
will be maintained as such throughout the term of this Agreement. The Seller represents and warrants that the Transferred Assets are being transferred with the intention of removing them from the Seller’s estate pursuant to Section 541 of
the Bankruptcy Code. 
 (d) In connection with the Initial Conveyance, the Seller agrees to file on or prior to the Closing
Date, at its own expense, a financing statement or statements with respect to the Transferred Assets Conveyed by the Seller hereunder from time to time meeting the requirements of applicable state law in the jurisdiction of the Seller’s
organization to perfect and protect the interests of the Purchaser created hereby under the UCC against all creditors of, and purchasers from, the Seller, and to deliver a file-stamped copy of such financing statements or other evidence of such
filings to the Purchaser as soon as reasonably practicable after its receipt thereof. 
 (e) The Seller agrees that from time to
time, at its expense, it will promptly execute and deliver all instruments and documents and take all actions as may be reasonably necessary or as the Purchaser may reasonably request, in order to perfect or protect the interest of the Purchaser in
the Transferred Assets purchased hereunder or to enable the Purchaser to exercise or enforce any of its rights hereunder. Without limiting the foregoing, the Seller will, in order to accurately reflect the Conveyances contemplated by this Agreement,
execute and file such financing or continuation statements or amendments thereto or assignments thereof (as permitted pursuant hereto) or other documents or instruments as may be reasonably requested by the Purchaser and mark its master computer
records (or related sub-ledger) noting the purchase by the Purchaser of the Transferred Assets and the Lien of the Administrative Agent pursuant to the Security Agreement. The Seller hereby authorizes the Purchaser to file and, to the fullest extent
permitted by applicable law the Purchaser shall be permitted to file initial financing statements, continuation statements and amendments thereto and assignments thereof without the Seller’s further action; provided that the description
of collateral contained in such financing statements shall be limited to only Transferred Assets. Carbon, photographic or other reproduction of this Agreement or any financing statement shall be sufficient as a financing statement. 

  
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 SECTION 2.2 Indemnification. Without limiting any other rights which any such Person
may have hereunder or under applicable law, the Seller agrees to indemnify on a net after-tax basis (including, for example, taking into account the deductibility of an applicable underlying damage, loss, liability or related cost and expense) the
Purchaser and its successors, transferees, and assigns (including each Secured Party) and all officers, directors, shareholders, controlling persons, employees and agents of any of the foregoing (each of the foregoing Persons being individually
called an “Indemnified Party”), forthwith on demand, from and against any and all damages, losses, claims, liabilities and related costs and expenses, including reasonable attorneys’ fees and disbursements (all of the foregoing
being collectively called “Indemnified Amounts”) awarded against or incurred by any of them arising out of any breach by the Seller of any of its obligations hereunder or arising as a result of the failure of any representation or
warranty of the Seller herein to be true and correct on the date such representation or warranty was made, excluding, however, (a) Indemnified Amounts in respect of any Transferred Asset due to such Obligor’s creditworthiness,
(b) Indemnified Amounts payable to an Indemnified Party to the extent determined by a court of competent jurisdiction to have resulted from gross negligence, bad faith or willful misconduct on the part of any Indemnified Party or its agent or
subcontractor, (c) except as otherwise specifically provided herein, non-payment by any Obligor of an amount due and payable with respect to a Transferred Asset, (d) any Excluded Taxes and any Taxes indemnifiable under the Credit Agreement
and (e) Indemnified Amounts resulting from the performance or non-performance of the Collateral Obligations. 
 ARTICLE
III 
 CONSIDERATION AND PAYMENT; REPORTING 
 SECTION 3.1 Purchase Price. The purchase price (the “Purchase Price”) for the Transferred Assets Conveyed on each Purchase Date shall be a dollar amount equal to the fair market
value (as agreed upon between the Seller and the Purchaser at the time of such Conveyance) of such Transferred Assets as of such date. 
 SECTION 3.2 Payment of Purchase Price. The Purchase Price shall be paid on the related Purchase Date at the option of the Seller (a) by the Purchaser making a payment in cash of immediately
available funds, (b) by the Seller making a capital contribution to the Purchaser, or (c) any combination of the foregoing clauses (a) and (b). 
 ARTICLE IV 
 REPRESENTATIONS AND WARRANTIES 

SECTION 4.1 Seller’s Representations and Warranties. The Seller represents and warrants to the Purchaser as of the Closing
Date and as of each Purchase Date: 
 (a) Organization and Good Standing. The Seller is a corporation duly formed, validly
existing and in good standing under the laws of its jurisdiction of organization and is duly qualified to do business, and is in good standing, in every jurisdiction in which the nature of its business and the performance of its obligations
hereunder and under the other Transaction 

  
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Documents to which it is a party requires it to be so qualified, except where the failure to be so qualified or in good standing would not reasonably be expected to have a material adverse effect
on (i) its ability to perform its obligations under this Agreement, (ii) the validity or enforceability of the Transferred Assets and the Related Security and (iii) its ability to perform its obligations under the other Transaction
Documents to which it is a party. 
 (b) Power and Authority. The Seller has the power and authority to own, pledge,
mortgage, operate and convey the Transferred Assets, to conduct its business as now, or proposed to be, conducted and to execute and deliver this Agreement and the Transaction Documents to which it is a party and to perform the transactions
contemplated hereby and thereby. 
 (c) Authorization; Contravention. The execution, delivery and performance by the
Seller of this Agreement, each other Transaction Document to which it is a party and all other agreements, instruments and documents which may be delivered by it pursuant hereto or thereto and the transactions contemplated hereby and thereby
(i) have been duly authorized by all necessary action on the part of the Seller, (ii) do not contravene or cause the Seller to be in default in any material respect under (A) its certificate of formation or limited partnership
agreement, (B) any contractual restriction with respect to any Debt of the Seller or contained in any indenture, loan or credit agreement, lease, mortgage, security agreement, bond, note or other agreement or instrument binding on or affecting
it or its property, or (C) any law, rule, regulation, order, license, requirement, writ, judgment, award, injunction or decree applicable to, binding on or affecting it or any of its property and (iii) do not result in or require the
creation of any Lien upon or with respect to any of its properties (other than Liens created pursuant to this Agreement). 
 (d)
Execution and Delivery. This Agreement and each other Transaction Document to which the Seller is a party have been duly executed and delivered by the Seller. 
 (e) Governmental Authorization. No approval, consent of, notice to, filing with or permits, licenses, qualifications or other action by any Governmental Authority having jurisdiction over it or its
properties is required or necessary (i) for the conduct of the Seller’s business as currently conducted, for the ownership, use, operation or maintenance of its properties and for the due execution, delivery and performance by the Seller
of this Agreement or any of the Transaction Documents to which it is a party, (ii) for the perfection of or the exercise by each of the Purchaser and the Administrative Agent of any of its rights or remedies under the Credit Agreement or
hereunder, or (iii) to ensure the legality, validity, or enforceability of this Agreement in any jurisdiction in which the Seller does business, in each case other than (A) consents, notices, filings and other actions which have been
obtained or made (or will be obtained or made substantially simultaneously with the Closing Date), and continuation statements and renewals in respect thereof and (B) where the lack of such consent, notice, filing or other action would not have
a material adverse effect on its ability to perform its obligations hereunder and under the Transaction Documents to which it is a party. 

  
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 (f) Legality; Validity; Enforceability. Assuming due authorization, execution and
delivery by each other party hereto and thereto, this Agreement and each other Transaction Document to which it is a party is the legal, valid and binding obligation of the Seller enforceable against the Seller in accordance with its respective
terms, except as such enforceability may be limited by (A) bankruptcy, insolvency, reorganization, or other similar laws affecting the enforcement of creditors’ rights generally, (B) equitable limitations on the availability of
specific remedies, regardless of whether such enforceability is considered in a proceeding in equity or at law and (C) implied covenants of good faith and fair dealing. 
 (g) No Litigation. There are no proceedings or investigations pending or, to its knowledge, threatened against the Seller, before any court or Governmental Authority having jurisdiction over it or
its properties (A) asserting the invalidity of this Agreement or any of the other Transaction Documents, (B) seeking to prevent the consummation of any of the transactions contemplated by this Agreement or any of the other Transaction
Documents, (C) seeking any determination or ruling that might materially and adversely affect the performance by the Purchaser of its obligations under, or the validity or enforceability of, this Agreement or any of the other Transaction
Documents, (D) seeking any determination or ruling that would reasonably be expected to have a material adverse effect on any of the Transferred Assets or (E) seeking to impose any excise, franchise, transfer or similar tax upon the
conveyance of the Transferred Assets hereunder. 
 (h) Legal Compliance. The Seller has complied and will comply in all
material respects with all Applicable Laws, judgments, agreements with governmental authorities, decrees and orders with respect to its business and properties and the Transferred Assets. 

(i) Taxes. The Seller has timely filed all federal and other material Tax returns (foreign, federal, state, local and otherwise)
required to be filed by it relating to the Transferred Assets and has paid all federal and other material Taxes due and payable by it relating to the Transferred Assets (other than any amount the validity of which is currently being contested in
good faith by appropriate proceedings and with respect to which reserves in conformity with GAAP have been provided on the books of the Seller). It is not liable for taxes with respect to the Transferred Assets payable by any other Person. No Tax
lien or similar Adverse Claim has been filed, and no claim has been filed or is being asserted, with respect to any Tax relating to the Transferred Assets. Any taxes, fees and other governmental charges payable by the Seller in connection with the
transactions contemplated by this Agreement and the execution and delivery of this Agreement have been paid or shall have been paid if and when due. 
 (j) Place of Business. The principal place of business and chief executive office of the Seller, and the offices where the Seller keeps all its records, are located at its address specified in
Section 8.3, or such other locations notified to the Purchaser in accordance with this Agreement in jurisdictions where all action required by the terms of this Agreement has been taken and completed. There are currently no, and during
the past four months (or such shorter time as the Seller has been in existence) there have not been, any other locations where the Seller is located (as that term is used in the UCC of the jurisdiction where such principal place of business is
located). 

  
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 (k) Ownership; Security Interest. 

i. In the event that, notwithstanding the intent of the parties, the Conveyances hereunder shall be characterized as loans
and not as sales and/or contributions, then this Agreement creates a valid and continuing Lien on the Transferred Assets in favor of the Purchaser and the Administrative Agent, as assignee, for the benefit of the Secured Parties, which security
interest is validly perfected under Article 9 of the UCC (to the extent such security interest may be perfected under such article), and is enforceable as such against creditors of and purchasers from the Purchaser; the Transferred Assets are
comprised of Instruments, Security Entitlements, General Intangibles, Certificated Securities, Uncertificated Securities, Securities Accounts, Investment Property and Proceeds and such other categories of collateral under the applicable UCC as to
which the Seller has complied with its obligations as set forth herein; the Seller has received all consents and approvals required by the terms of any Collateral Obligation to the sale and granting of a security interest in the Collateral
Obligations hereunder to the Purchaser and the Administrative Agent, as assignee on behalf of the Secured Parties; the Seller has taken all necessary steps to file or authorize the filing of all appropriate financing statements in the proper filing
office in the appropriate jurisdictions under Applicable Law in order to perfect the security interest in that portion of the Transferred Assets in which a security interest may be perfected by filing pursuant to Article 9 of the UCC as in effect in
Maryland; all original executed copies of each underlying promissory note constituting or evidencing any Transferred Asset have been or, subject to the delivery requirements contained in the Credit Agreement, will be delivered to the Purchaser or
its designee; none of the underlying promissory notes that constitute or evidence the Collateral Obligations has any marks or notations indicating that they have been pledged, assigned or otherwise conveyed to any Person other than the Purchaser and
the Administrative Agent, as assignee on behalf of the Secured Parties; with respect to a Transferred Asset that constitutes a Certificated Security, such certificated security has been delivered to the Purchaser or its designee and, if in
registered form, has been specially Indorsed (within the meaning of the UCC) to the Administrative Agent or in blank by an effective Indorsement or has been registered in the name of the Administrative Agent upon original issue or registration of
transfer by the Seller of such Certificated Security; and in the case of an Uncertificated Security, by causing the Purchaser or its designee to become the registered owner of such uncertificated security. 

(l) Fair Consideration; No Avoidance for Collateral Obligation Payments. With respect to each Transferred Collateral Obligation
sold hereunder, the Seller sold such Transferred Collateral Obligation to the Purchaser in exchange for payment, made in accordance with the provisions of this Agreement, in an amount which constitutes fair consideration and reasonably equivalent
value. Each such Conveyance referred to in the preceding sentence shall not have been made for or on account of an antecedent debt owed by the Seller to the Purchaser. In addition, no such Conveyance shall have been made with the intent to hinder or
delay payment to or defraud any creditor of the Seller. 
 (m) Eligibility of Transferred Collateral Obligations. Each
Transferred Collateral Obligation Conveyed hereunder is, at the time of such Conveyance, an Eligible Investment. As of each Purchase Date, Schedule A is an accurate and complete listing of all the Transferred Collateral Obligations and other
Transferred Assets hereunder as of such Purchase Date. 

  
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 (n) Adequate Capitalization; No Insolvency. The Seller is adequately capitalized and
will not become insolvent after giving effect to the transactions contemplated by this Agreement and the Transaction Documents. The Seller is adequately capitalized for its business as proposed to be conducted in the foreseeable future and does not
expect the commencement of any insolvency, bankruptcy or similar proceedings or the appointment of a receiver, liquidator or similar official in respect of its assets. The Seller executed and delivered each of the Transaction Documents to which it
is a party for fair consideration and without the intent to hinder, delay or defraud any of its creditors or any other Person. 

(o) True and Complete Information. All information heretofore or hereafter furnished by or on behalf of the Seller in writing to
any Lender or the Administrative Agent in connection with this Agreement, the other Transaction Documents, the Transferred Assets, or any transaction contemplated hereby is and will be (when taken as a whole) true, correct and complete in all
material respects. 
 (p) Financial Statements. The Seller has delivered to each Lender complete and correct copies of
(A) the audited consolidated financial statements of the Seller for the fiscal year most recently ended, and (B) the unaudited consolidated financial statements of the Seller for the fiscal quarter most recently ended, in each case when
(and to the extent) required to be delivered under Sections 6.01(b)(i) and (ii) of the Credit Agreement. Such financial statements (including the related notes) fairly present the financial condition of the Seller as of the respective dates
thereof and the results of operations for the periods covered thereby, each in accordance with GAAP. 
 (q) Payment in
Full. The Seller had no actual knowledge at the time of Conveyance of a Transferred Asset of any fact which leads it to expect that any payments on such Transferred Asset will not be paid in full when due or to expect any other material adverse
effect on (A) the performance by the Seller of its obligations under this Agreement or any of the Transaction Documents to which it is a party, (B) the validity or enforceability of this Agreement or any of the Transaction Documents to
which it is a party, or (C) the Transferred Assets or the interests of the Seller therein. 
 (r) No Brokers or
Finders. No broker or finder acting on behalf of the Seller was employed or utilized in connection with this Agreement or the other Transaction Documents or the transactions contemplated hereby or thereby and the Seller has no obligation to any
Person in respect of any finder’s or brokerage fees in connection therewith. 
 (s) Restricted Payments. The Seller
shall not cause or permit the Purchaser to make any payments or distributions which would violate Section 6.02(r) of the Credit Agreement. 

  
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 (t) Special Purpose Entity. The Purchaser is an entity with assets and liabilities
separate and distinct from those of the Seller and any Affiliates thereof, and the Seller hereby acknowledges that the Administrative Agent, the Lenders and the other Secured Parties are entering into the transactions contemplated by the Credit
Agreement in reliance upon the Purchaser’s identity as a legal entity that is separate from the Seller and from each other Affiliate of the Seller. Therefore, from and after the date of execution and delivery of this Agreement, the Seller shall
take all reasonable steps, including all steps that the Purchaser or the Administrative Agent may from time to time reasonably request, to maintain the Purchaser’s identity as a legal entity that is separate from the Seller and from each other
Affiliate of the Seller, and to make it manifest to third parties that the Purchaser is an entity with assets and liabilities distinct from those of the Seller and each other Affiliate thereof and not just a division of the Seller or any such other
Affiliate. 
 (u) Set–Off, etc. At the time of Conveyance of a Transferred Asset and to the knowledge of the Seller
after reasonable inquiry, such Transferred Asset has not been compromised, adjusted, extended, satisfied, subordinated, rescinded, set–off or modified by the Seller or by the Obligor thereof, and at such time such Transferred Asset is not
subject to compromise, adjustment, extension, satisfaction, subordination, rescission, set–off, counterclaim, defense, abatement, suspension, deferment, deduction, reduction, termination or modification, whether arising out of transactions
concerning such Transferred Asset or otherwise, by the Seller or by the Obligor with respect thereto, except, in each case, for amendments, extensions and modifications, if any, to such Transferred Asset otherwise permitted under the Transaction
Documents. 
 (v) No Fraud. Each Collateral Obligation was originated without any fraud or material misrepresentation by
the Seller or, to the Seller’s knowledge, on the part of the related Obligor. 
 SECTION 4.2 Reaffirmation of
Representations and Warranties by the Seller; Notice of Breach. On the Closing Date and on each Purchase Date, the Seller, by accepting the proceeds of such Conveyance, shall be deemed to have certified that all representations and warranties
described in Section 4.1 are true and correct on and as of such day as though made on and as of such day (or, if such representation or warranty is limited to a specific date, such specific date). The representations and warranties set
forth in Section 4.1 shall survive (i) the Conveyance of the Transferred Assets to the Purchaser, (ii) the termination of the rights and obligations of the Purchaser and the Seller under this Agreement and (iii) the
termination of the rights and obligations of the Purchaser under the Credit Agreement. Upon discovery by a Responsible Officer of the Purchaser or the Seller of a breach of any of the foregoing representations and warranties in any material respect,
the party discovering such breach shall give prompt written notice to the other and to the Administrative Agent. 

  
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 ARTICLE V 
 COVENANTS OF THE SELLER 
 SECTION 5.1 Covenants of the Seller. The
Seller hereby covenants and agrees with the Purchaser that, from the date hereof, and until all amounts owed by the Seller pursuant to this Agreement have been paid in full (other than as expressly survive the termination of this Agreement), unless
the Purchaser otherwise consents in writing: 
 (a) Compliance with Agreements and Applicable Laws. The Seller shall
perform each of its obligations under this Agreement and the other Transaction Documents to which it is a party and comply with all Applicable Laws, including those applicable to the Transferred Collateral Obligations and all proceeds thereof,
except to the extent that the failure to so comply would not reasonably be expected to have a material adverse effect on (i) its ability to perform its obligations under the Transaction Documents to which it is a party, (ii) its assets,
operations, properties, financial condition, or business or (iii) the validity or enforceability of this Agreement or any of the other Transaction Documents. 
 (b) Maintenance of Existence and Conduct of Business. The Seller shall: (i) do or cause to be done all things necessary to (A) preserve and keep in full force and effect its existence as
a corporation and maintain its rights and franchises in its jurisdiction of formation and (B) qualify and remain qualified as a foreign corporation in good standing and preserve its rights and franchises in each jurisdiction in which the
failure to so qualify and remain qualified and preserve its rights and franchises would reasonably be expected to have a material adverse effect on its assets, operations, properties, financial condition, or business; (ii) continue to conduct
its business substantially as now conducted or as otherwise permitted hereunder and under its organizational documents; and (iii) at all times maintain, preserve and protect all of its licenses, permits, charters and registrations in each case
except where the failure to maintain such liens, permits, charters and registrations would not reasonably be expected to have a material adverse effect on its assets, operations, properties, financial condition, or business. 

(c) Cash Management Systems: Deposit of Collections. The Seller shall transfer, or cause to be transferred, all interest
collections and all principal collections received with respect to any Conveyance by the Seller to the Custodial Account by the close of business on the Business Day following the date such Collections are received. 

(d) Books and Records. The Seller shall keep proper books of record and account in which full and correct entries shall be made of
all transactions with the Purchaser and the assets and business of the Seller related to its obligations under this Agreement or any Transferred Assets or assets proposed to be transferred in accordance with GAAP, maintain and implement
administrative and operating procedures necessary to fulfill its obligations hereunder; and keep and maintain all documents, books, records and other information necessary or reasonably advisable and relating to the Transferred Assets prior to their
Conveyance hereunder for the collection of all Transferred Assets. 
 (e) Taxes. The Seller will file on a timely basis
all federal and other material Tax returns required to be filed and will pay all federal and other material Taxes due and payable by it (other than any amount the validity of which is contested in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP are provided on the books of the Seller). 
 (f) ERISA. The Seller
shall not, and shall not cause or permit any of its Affiliates to, cause or permit to occur an event that results in the imposition of a Lien on its interest, if any, in any Transferred Asset under Section 412 of the IRC or Section 303(K)
or 4068 of ERISA. 

  
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 (g) Liens. The Seller shall not create, incur, assume or permit to exist any Lien on
or with respect to any of its rights under any of the Transaction Documents (other than the Lien covering this Agreement and existing on the Closing Date, which has been disclosed to the Administrative Agent) or on or with respect to any of its
rights in the Transferred Assets, in each case other than Permitted Liens. For the avoidance of doubt, this Section 5.1(g) shall not apply to any property retained by the Seller and not Conveyed or purported to be Conveyed hereunder.

 (h) Change of Name. Etc. The Seller shall not change its name, identity or corporate structure in any manner that
would make any financing statement or continuation statement filed by the Seller (or by the Administrative Agent on behalf of the Seller) in accordance with Sections 2.1(d) and (e) seriously misleading or change its jurisdiction of
organization, unless the Seller shall have given the Purchaser at least 10 days prior written notice thereof, and shall promptly file appropriate amendments to all previously filed financing statements and continuation statements. 

(i) Sale Characterization. The Seller shall not make statements or disclosures, or treat the transactions contemplated by this
Agreement (other than for Tax or accounting purposes) in any manner other than as a true sale, contribution or absolute assignment of the title to and sole record and beneficial ownership interest of the Transferred Collateral Obligations Conveyed
or purported to be Conveyed hereunder; provided that the Seller may consolidate the Purchaser and/or its properties and other assets for accounting purposes in accordance with GAAP. 

(j) Commingling. The Seller shall not, and shall not permit any of its Affiliates to, deposit or permit the deposit of any funds
that do not constitute Collections or other proceeds of any Collateral Obligations into the Custodial Account. 
 (k)
Nonconsolidation Opinion. The Seller shall not take any action contrary to the “Assumptions and Facts” section in the opinion of Dechert LLP, dated the date hereof, relating to certain nonconsolidation matters. 

(l) Risk Retention. 
 i. For so long as any Obligations are outstanding: (i) the Seller represents and undertakes to the Lender for the purposes of the Retention Requirements that: (A) as an originator for the
purposes of the Retention Requirements, it holds and will retain on an on-going basis, a net economic interest in the securitisation transaction contemplated by the Credit Agreement, which shall not be less than 5% of the aggregate nominal value of
all the Collateral Obligations (the “Retained Economic Interest”) measured at the time of origination (being the occasion of each origination or acquisition of a Collateral Obligation by the Purchaser); (B) the Retained
Economic Interest takes the form of a first loss tranche in accordance with paragraph 1(d) of Article 405 of the EU Capital Requirements Regulation (Regulation (EU) No 575/2013), as represented by the Seller’s limited company interest in the
Purchaser; (C) it holds and will retain up to 100% of the limited liability company interests of the Purchaser and the Purchaser shall have no other issued equity interests; (D) the aggregate capital contributions made by the Seller with

  
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respect to the limited liability company interests in the Purchaser shall represent at least 5.0% of the aggregate of the nominal value of all the Collateral Obligations measured at the time of
origination as described in (A) above; and (E) the Seller shall not sell or enter into any credit risk mitigation, short positions or any other hedges or otherwise seek to mitigate its credit risk with respect to its limited liability
company interests in the Purchaser (except as permitted by the EU Capital Requirements Regulation referenced in (B) above). 
 ii. Each Collateral Report shall contain or be accompanied by a certification from the Seller containing a representation that all of the conditions set forth in clause (i) above are true and have
been true up to and on each date since the prior Reporting Date (or, with respect to the first Reporting Date, since the Closing Date). The Seller shall provide to the Administrative Agent and/or any Lender that is subject to the Retention
Requirements: (A) prompt written notice of any breach of its obligations set forth in Section 5.1(l)(i); and (B) all information that any such entity requests in connection with its obligations under the Retention Requirements.

 ARTICLE VI 
 WARRANTY LOANS 
 SECTION 6.1 Warranty Collateral Obligations. The
Seller agrees that, with respect to any Transferred Collateral Obligation, in the event of (x) a Repurchase Event with respect to such Transferred Collateral Obligation or (y) a breach of any representation or warranty or covenant
applicable to a Transferred Asset set forth in Article IV or Article V (each such Transferred Collateral Obligation, an “Warranty Collateral Obligation”), no later than 30 days after the earlier of (x) knowledge
of such breach on the part of the Seller and (y) receipt by the Seller of written notice thereof given by the Purchaser, the Administrative Agent or the Required Lenders, the Seller shall either (a) pay to the Custodial Account in
immediately available funds the Repurchase Amount with respect to the Warranty Collateral Obligation(s) to which such breach relates or (b) substitute for such Warranty Collateral Obligation(s) one or more Eligible Investment(s) with an
aggregate Collateral Obligation Amount at least equal to the Repurchase Amount of the Warranty Collateral Obligation(s) being replaced; provided, that no such repayment or substitution shall be required to be made with respect to any Warranty
Collateral Obligation (and such Collateral Obligation shall cease to be a Warranty Collateral Obligation) if, on or before the expiration of such 30 day period either (x) such Repurchase Event shall no longer be continuing or (y) the
representations and warranties in Article IV and the covenants in Article V with respect to such Warranty Collateral Obligation shall be made true and correct in all material respects with respect to such Warranty Collateral Obligation
as if such Warranty Collateral Obligation had been Conveyed to the Purchaser on such day, as applicable. 
 SECTION 6.2
Dilutions, Etc. The Seller agrees that if the Principal Balance of a Transferred Collateral Obligation that has been sold by the Seller hereunder is either reduced or adjusted as a result of any valid setoff by the Obligor against the Seller,
the Seller shall be deemed to have received on such day an interest and principal collection of such Transferred Collateral Obligation in the amount of such setoff and shall, within three (3) Business Days, pay to the Custodial Account in
immediately available funds an amount equal to such setoff. 

  
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 ARTICLE VII 
 CONDITIONS PRECEDENT 
 SECTION 7.1 Conditions Precedent. The
obligations of the Purchaser to pay the Purchase Price for the Transferred Assets sold on the Closing Date and any Purchase Date shall be subject to the satisfaction of the following conditions: 

(a) All representations and warranties of the Seller contained in this Agreement shall be true and correct in all material respects on
such Purchase Date; 
 (b) All information concerning the Transferred Assets provided to the Purchaser and the Administrative
Agent shall be true and correct, when taken as a whole, in all material respects as of such Purchase Date; 
 (c) The Seller
shall have performed in all material respects all other obligations required to be performed by the provisions of this Agreement and the other Transaction Documents to which it is a party; 

(d) The Seller shall have either filed or caused to be filed the financing statement(s) required to be filed pursuant to
Sections 2.1(d) and (e); and 
 (e) All corporate and legal proceedings, and all instruments in connection with the
transactions contemplated by this Agreement and the other Transaction Documents shall be reasonably satisfactory in form and substance to the Purchaser, and the Purchaser shall have received from the Seller copies of all documents (including records
of corporate proceedings) relevant to the transactions herein contemplated as the Purchaser may reasonably have requested. 

ARTICLE VIII 
 MISCELLANEOUS PROVISIONS 
 SECTION 8.1 Amendments, Etc. This
Agreement and the rights and obligations of the parties hereunder may not be amended, supplemented, waived or otherwise modified except in an instrument in writing signed by the Purchaser and the Seller and consented to in writing by the
Administrative Agent. Any Conveyance or reconveyance executed in accordance with the provisions hereof shall not be considered an amendment or modification to this Agreement. 

SECTION 8.2 Governing Law: Submission to Jurisdiction. 

(a) THIS AGREEMENT AND THE NOTES SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK.

  
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 (b) Each party hereto hereby irrevocably submits to the non-exclusive jurisdiction of any
New York State or Federal court sitting in New York City in any action or proceeding arising out of or relating to the Transaction Documents, and each party hereto hereby irrevocably agrees that all claims in respect of such action or proceeding may
be heard and determined in such New York State court or, to the extent permitted by law, in such Federal court. The parties hereto hereby irrevocably waive, to the fullest extent they may effectively do so, the defense of an inconvenient forum to
the maintenance of such action or proceeding. The parties hereto 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. 
 SECTION 8.3 Notices. All notices and other communications provided for hereunder shall, unless otherwise stated
herein, be in writing (including facsimile communication) and shall be personally delivered or sent by certified mail, electronic mail, postage prepaid, or by facsimile, to the intended party at the address or facsimile number of such party set
forth below: 
  

	 	(a)	in the case of the Purchaser: 

  

	 	  	Dunning Creek LLC 

	 	  	c/o FS Investment Corporation II 

	 	  	2929 Arch Street, Suite 675 

	 	  	Philadelphia, PA 19104 

	 	  	Attention: Gerald F. Stahlecker, Executive Vice President 

	 	  	Telephone: (215) 495-1169 

	 	  	Facsimile: (215) 222-4649 

  

	 	(b)	in the case of the Seller: 

  

	 	  	FS Investment Corporation II 

	 	  	2929 Arch Street, Suite 675 

	 	  	Philadelphia, PA 19104 

	 	  	Attention: Gerald F. Stahlecker, Executive Vice President 

	 	  	Telephone: (215) 495-1169 

	 	  	Facsimile: (215) 222-4649 

(in each case, with a copy to the Administrative Agent at the address for notice provided under the Credit Agreement) 

All such notices and communications shall be effective, (a) if personally delivered, when received, (b) if sent by certified mail, three
Business Days after having been deposited in the mail, postage prepaid, (c) if sent by two-day mail, two Business Days after having been deposited in the mail, postage prepaid, (d) if sent by overnight courier, one Business Day after
having been given to such courier, and (e) if transmitted by facsimile, when sent, receipt confirmed by telephone or electronic means. 

  
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 SECTION 8.4 Severability of Provisions. If any one or more of the covenants,
agreements, provisions or terms of this Agreement shall for any reason whatsoever be held invalid, then such covenants, agreements, provisions, or terms shall be deemed severable from the remaining covenants, agreements, provisions, or terms of this
Agreement and shall in no way affect the validity or enforceability of the other provisions of this Agreement. 
 SECTION 8.5
Further Assurances. 
 (a) The Purchaser and the Seller each agree that at any time and from time to time, at its expense
and upon reasonable request of the Administrative Agent, it shall promptly execute and deliver all further instruments and documents, and take all reasonable further action, that is necessary or desirable to perfect and protect the Conveyances and
security interests granted or purported to be granted by this Agreement or to enable the Administrative Agent or any of the Secured Parties to exercise and enforce its rights and remedies under this Agreement with respect to any Collateral.

 (b) The Purchaser and the Seller agree to do and perform, from time to time, any and all acts and to execute any and all
further instruments reasonably requested by the other party more fully to effect the purposes of this Agreement and the other Transaction Documents, including the execution of any financing statements or continuation statements or equivalent
documents relating to the Transferred Collateral Obligations for filing under the provisions of the UCC or other laws of any applicable jurisdiction. 
 (c) The Purchaser and the Seller hereby severally authorize the Administrative Agent to file one or more financing or continuation statements, and amendments thereto, relating to all or any part of the
Transferred Assets. 
 (d) The Seller shall furnish to the Administrative Agent from time to time such statements and schedules
further identifying and describing the Related Security and such other reports in connection with the Transferred Assets as the Administrative Agent may reasonably request, all in reasonable detail. 

SECTION 8.6 No Waiver; Cumulative Remedies. No failure to exercise and no delay in exercising, on the part of the Purchaser, the
Seller or the Administrative Agent, any right, remedy, power or privilege hereunder, shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided are cumulative and not exhaustive of any rights, remedies, powers and privilege provided by law. 

SECTION 8.7 Counterparts. This Agreement may be executed in two or more counterparts including telecopy transmission thereof (and
by different parties on separate counterparts), each of which shall be an original, but all of which together shall constitute one and the same instrument. 
 SECTION 8.8 Binding Effect; Third-Party Beneficiaries. This Agreement will inure to the benefit of and be binding upon the parties hereto and their respective successors and permitted assigns.

  
 -18-

 The Seller hereby acknowledges that (a) the Administrative Agent is the beneficiary of
a collateral assignment of this Agreement pursuant to Section 2(a)(v)(4) of the Security Agreement, (b) the Administrative Agent for the benefit of the Secured Parties shall be an express third party beneficiary of the Purchaser’s
rights hereunder, including but not limited to the Purchaser’s right to indemnification set forth in Section 2.2 and (c) each Lender shall be an express third party beneficiary of the Purchaser’s rights under
Section 5.1(l) and the Seller hereby agrees that each Lender may rely on the covenants made in such Section 5.1(l), subject, in the case of clauses (a) and (b), to each of the limitations, restrictions and conditions set
forth in Section 2 of the Security Agreement with respect to the collateral assignment of this Agreement; provided that, such collateral assignment and such third party beneficiary rights shall automatically terminate upon the irrevocable
payment in full of the Obligations (other than contingent indemnity obligations as to which no claim has been made) and the termination of the Commitments in full. 
 SECTION 8.9 Merger and Integration. Except as specifically stated otherwise herein, this Agreement sets forth the entire understanding of the parties relating to the subject matter hereof, and all
prior understandings, written or oral, are superseded by this Agreement. 
 SECTION 8.10 Headings. The headings herein
are for purposes of reference only and shall not otherwise affect the meaning or interpretation of any provision hereof. 

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 IN WITNESS WHEREOF, the Purchaser and the Seller each have caused this Sale and Contribution
Agreement to be duly executed by their respective officers as of the day and year first above written. 
  

			
	FS INVESTMENT CORPORATION II, as Seller
		
	By:	 	/s/ Gerald F. Stahlecker
		 	Name: Gerald F. Stahlecker
		 	Title: Executive Vice President

  

			
	DUNNING CREEK LLC, as Purchaser
		
	By:	 	/s/ Gerald F. Stahlecker
		 	Name: Gerald F. Stahlecker
		 	Title: Executive Vice President

 Signature Page to the Sale and Contribution Agreement

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