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| T | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|--------------------------------------------------------------------------------------|

| £ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|--------|------------------------------------------------------------------------------------------|

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| Delaware                                                       | 54-1889518                                      |
|----------------------------------------------------------------|-------------------------------------------------|
| (State or Other Jurisdiction of Incorporation or Organization) | (I.R.S.  Employer Identification No.) |
|                                                           |                                            |
| 1100 Wilson Boulevard, Suite 3000, Arlington, VA               | 22209                                           |
| (Address of Principal Executive Offices)                       | (Zip Code)                                      |

|   | Title of each class                     | Name of each exchange on which registered |   |
|--------|-----------------------------------------|-------------------------------------------|--------|
|   | Common Stock, par value $0.01 per share | The NASDAQ Global Select Market           |   |

| Large accelerated filer                       | £ | Accelerated filer         | T      |
|-----------------------------------------------|--------|---------------------------|--------|
| Non-accelerated filer                         | £ | Smaller reporting company | £ |
| (Do not check if a smaller reporting company) |

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| PART I        | 1      |
|---------------|--------|
| Item 1.  |   | Business | 1 |
| Item 1A. |   | Risk Factors. | 15 |
| Item 1B. |   | Unresolved Staff Comments. | 25 |
| Item 2.  |   | Properties. | 25 |
| Item 3.  |   | Legal Proceedings. | 25 |
| Item 4.  |   | Submissions of Matters to a Vote of Security Holders. | 25 |
|          |   |   |   |
| PART II       | 26     |
| Item 5.  |   | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. | 26 |
| Item 6.  |   | Selected Consolidated Financial Data | 28 |
| Item 7.  |   | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 29 |
| Item 7A. |   | Quantitative and Qualitative Disclosures about Market Risk | 74 |
| Item 8.  |   | Financial Statements and Supplementary Data | 76 |
| Item 9.  |   | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. | 125 |
| Item 9A. |   | Controls and Procedures. | 125 |
| Item 9B. |   | Other Information | 126 |
|          |   |   |   |
| PART III      | 127    |
| Item 10. |   | Directors, Executive Officers and Corporate Governance. | 127 |
| Item 11. |   | Executive Compensation. | 127 |
| Item 12. |   | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. | 127 |
| Item 13. |   | Certain Relationships and Related Transactions, and Director Independence. | 127 |
| Item 14. |   | Principal Accountant Fees and Services. | 127 |
|          |   |   |   |
| PART IV       | 128    |
| Item 15. |   | Exhibits and Financial Statement Schedules | 128 |
| SIGNATURES    | 135    |

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| (dollars in thousands)              |                   |   | As of December 31, 2009 |    |   | Year ended December 31, 2009 |   |
|-------------------------------------|------------------------|--------|------------------------------|---------|--------|-----------------------------------|--------|
| Company                             | Industry               |   | Fair Value                   |    |   | % of Portfolio                    |   |   | Revenues |   |   | % of Total Revenues |   |
| Broadview Networks Holdings, Inc.   | Communications--CLEC   |   | $                            | 138,834 |   |                              |   | 14.1 | % |   | $ | — |   |   |   | — | % |
| JetBroadband Holdings, LLC          | Cable                  |   |                         | 50,249  |   |                              |   | 5.1 |   |   |   | 3,929 |   |   |   | 3.9 |   |
| Jet Plastica Investors, LLC         | Plastic Products       |   |                         | 42,787  |   |                              |   | 4.3 |   |   |   | 5,471 |   |   |   | 5.5 |   |
| NDSSI Holdings, LLC                 | Electronics            |   |                         | 42,082  |   |                              |   | 4.3 |   |   |   | 5,342 |   |   |   | 5.4 |   |
| MCI Holdings LLC                    | Healthcare             |   |                         | 41,363  |   |                              |   | 4.2 |   |   |   | 4,082 |   |   |   | 4.1 |   |
| Avenue Broadband LLC                | Cable                  |   |                         | 40,950  |   |                              |   | 4.2 |   |   |   | 4,025 |   |   |   | 4.0 |   |
| Restaurant Technologies, Inc.       | Food Services          |   |                         | 39,767  |   |                              |   | 4.0 |   |   |   | 6,728 |   |   |   | 6.7 |   |
| Superior Industries Investors, LLC  | Sporting Goods         |   |                         | 39,103  |   |                              |   | 4.0 |   |   |   | 3,397 |   |   |   | 3.4 |   |
| Quantum Medical Holdings, LLC       | Laboratory Instruments |   |                         | 34,790  |   |                              |   | 3.5 |   |   |   | 4,160 |   |   |   | 4.2 |   |
| LMS INTELLIBOUND, INC.              | Logistics              |   |                         | 31,694  |   |                              |   | 3.2 |   |   |   | 5,518 |   |   |   | 5.5 |   |
| Total—ten largest investments |                   |   |                         | 501,619 |   |                              |   | 50.9 |   |   |   | 42,652 |   |   |   | 42.7 |   |
| Other portfolio companies           |                   |   |                         | 484,727 |   |                              |   | 49.1 |   |   |   | 57,182 |   |   |   | 57.3 |   |
| Total investment portfolio          |                   |   | $                            | 986,346 |   |                              |   | 100.0 | % |   | $ | 99,834 |   |   |   | 100.0 | % |

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|                                                            |   | As of December 31, 2009 |    |
|-----------------------------------------------------------------|--------|------------------------------|---------|
|                                                            |   | Investments at Fair Value    |    |   | Percent of |   |
| (dollars in thousands)                                          |   | Debt                         |    |   | Equity |   |   | Total |   |   | Debt Portfolio |   |   | Equity Portfolio |   |   | Total Portfolio |   |
| Valuations/reviews prepared by independent firms(a)             |   |                         |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Fourth quarter 2009                                             |   | $                            | 160,185 |   |   | $ | 171,419 |   |   | $ | 331,604 |   |   |   | 23.4 | % |   |   | 57.0 | % |   |   | 33.6 | % |
| Third quarter 2009                                              |   |                         | 97,965  |   |   |   | 10,483 |   |   |   | 108,448 |   |   |   | 14.3 |   |   |   | 3.5 |   |   |   | 11.0 |   |
| Second quarter 2009                                             |   |                         | 135,567 |   |   |   | 13,307 |   |   |   | 148,874 |   |   |   | 19.8 |   |   |   | 4.4 |   |   |   | 15.1 |   |
| First quarter 2009                                              |   |                         | 235,551 |   |   |   | 96,758 |   |   |   | 332,309 |   |   |   | 34.3 |   |   |   | 32.1 |   |   |   | 33.7 |   |
| Total valuations/reviews prepared by independent firms          |   |                         | 629,268 |   |   |   | 291,967 |   |   |   | 921,235 |   |   |   | 91.8 |   |   |   | 97.0 |   |   |   | 93.4 |   |
| Fair value derived from sales transaction                       |   |                         |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Third quarter 2009                                              |   |                         | 51,768  |   |   |   | — |   |   |   | 51,768 |   |   |   | 7.6 |   |   |   | — |   |   |   | 5.2 |   |
| Total derived from sales transaction                            |   |                         | 51,768  |   |   |   | — |   |   |   | 51,768 |   |   |   | 7.6 |   |   |   | — |   |   |   | 5.2 |   |
| Not evaluated during the 12 months ended December 31, 2009 |   |                         | 4,437   |   |   |   | 8,906 |   |   |   | 13,343 |   |   |   | 0.6 |   |   |   | 3.0 |   |   |   | 1.4 |   |
| Total investment portfolio                                      |   | $                            | 685,473 |   |   | $ | 300,873 |   |   | $ | 986,346 |   |   |   | 100.0 | % |   |   | 100.0 | % |   |   | 100.0 | % |

|   | (a) | Valuations/reviews prepared by independent firms more than one time during the twelve months ended December 31, 2009 have that investment’s fair value reflected in the most recent quarter for which a valuation/review was prepared. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Investment Rating | Summary Description                                                                                                                                              |
|-------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 1                 | Capital gain expected or realized                                                                                                                                |
| 2                 | Full return of principal and interest or dividend expected with customer performing in accordance with plan                                                      |
| 3                 | Full return of principal and interest or dividend expected, but customer requires closer monitoring                                                              |
| 4                 | Some loss of interest or dividend expected, but still expect an overall positive internal rate of return on the investment                                       |
| 5                 | Loss of interest or dividend and some loss of principal investment expected, which would result in an overall negative internal rate of return on the investment |

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| (dollars in thousands)                                                                                               |   |   | December 31, 2009    |    |   | December 31, 2008 |   |
|----------------------------------------------------------------------------------------------------------------------|--------|--------|---------------------------|---------|--------|------------------------|--------|
|      Investment Rating                                                                           |   |   | Investments at Fair Value |    |   | % of Total Portfolio   |   |   | Investments at Fair Value |   |   | % of Total Portfolio |   |
|                     1      |   |   | $                         | 573,231 | (a)    |                   |   | 58.1 | % |   | $ | 719,765 | (a) |   |   | 59.8 | % |
|                     2      |   |   |                      | 125,222 |   |                   |   | 12.7 |   |   |   | 206,829 |   |   |   | 17.2 |   |
|                     3 |   |   |                      | 271,447 |   |                   |   | 27.5 |   |   |   | 233,172 |   |   |   | 19.4 |   |
|                     4 |   |   |                      | 3,394   |   |                   |   | 0.4 |   |   |   | 32,648 |   |   |   | 2.7 |   |
|                     5 |   |   |                      | 13,052  |   |                   |   | 1.3 |   |   |   | 10,734 |   |   |   | 0.9 |   |
|                 Total                     |   |   | $                         | 986,346 |   |                   |   | 100.0 | % |   | $ | 1,203,148 |   |   |   | 100.0 | % |

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|   | (a) | As of December 31, 2009 and 2008, Investment Rating “1” included $218.6 million and $362.9 million, respectively, of loans to companies in which we also held equity securities. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | generate favorable risk-adjusted rates of return by delivering capital and strategic insight to increase our portfolio companies’ enterprise value; |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | maintain sound credit and investment discipline and pricing practices, regardless of market conditions, to avoid adverse investment selection; and |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | manage risk by utilizing an integrated team approach to business development, underwriting and investment servicing. |
|--------|---------|----------------------------------------------------------------------------------------------------------------------|

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|   | · | Industry Risks—maturity, cyclicality and seasonality associated with the industries in which we invest; |
|--------|--------|---------------------------------------------------------------------------------------------------------------|

|   | · | Competitive Risks—strengths and weaknesses of prospective portfolio companies relative to their competitors’ pricing, product quality, customer loyalty, substitution and switching costs, brand positioning and capitalization.  We also assess the defensibility of a prospect’s market position and its opportunity for increasing market share; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Management Risks—track records, industry experience, their business plan and management’s incentive, including the level of direct investment in the portfolio companies in which we invest; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Regulatory Risks—new and evolving regulations applicable to the BDC industry and industries in which the prospective portfolio companies operate; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Customer Concentration and Market Risks—sustainability, stability and opportunities for the growth of the prospective portfolio companys’ respective customer bases, including the number and size of its customers, attrition rates and dependence on one or a limited number of customers; and |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Technology Risks—impact of technological advances in the industries and portfolio companies in which we may invest. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------|

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|   | · | a business description; |
|--------|--------|-------------------------|

|   | · | historical financial analyses, projections and scenario modeling; |
|--------|--------|-------------------------------------------------------------------|

|   | · | a risk evaluation specific to the prospective portfolio company’s business and industry, considering the anticipated use of proceeds of our investment; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | an enterprise valuation to assess the underlying value of the customer, both as an ongoing operation and its value relative to comparable public and private companies; and |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | a description of the capital structure and the investment risk and return characteristics. |
|--------|--------|--------------------------------------------------------------------------------------------|

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|   | · | Senior Debt—We provide cash flow based senior debt in the form of amortizing term loans, bullet maturity term loans, as well as revolving credit facilities. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Second Lien Debt—We provide second-lien term loans on a sole-source or participant basis where assets or enterprise-value based borrowing capacity is not readily available within typical senior debt leverage constraints. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Secured and Unsecured Subordinated Debt—We invest in secured and unsecured subordinated debt, which may be structured with a combination of current interest, deferred interest or equity linked components. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Equity—We invest in minority or control equity positions with private equity partners or on our own. |
|--------|--------|------------------------------------------------------------------------------------------------------------|

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|   | · | monitoring the portfolio company’s adherence to relevant covenants and other contract terms; |
|--------|--------|----------------------------------------------------------------------------------------------------|

|   | · | assessing and assisting the portfolio company’s ongoing financial and operating performance; |
|--------|--------|----------------------------------------------------------------------------------------------------|

|   | · | recommending adjustments to the fair value of the investment; and |
|--------|--------|-------------------------------------------------------------------|

|   | · | other administrative tasks such as legal support, billing and collections, and other accounting functions. |
|--------|--------|------------------------------------------------------------------------------------------------------------|

|   | • | act as an underwriter of securities of other issuers, except to the extent that we may be deemed an “underwriter” of securities (i) purchased by us that must be registered under the Securities Act of 1933, as amended, before they may be offered or sold to the public, or (ii) in connection with offerings of securities by our portfolio companies; |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | • | sell securities short in an uncovered position; |
|--------|---------|-------------------------------------------------|

|   | • | write or buy uncovered put or call options, except to the extent of options, warrants or conversion privileges in connection with our loans or other investments, and rights to require the issuers of such investments or their affiliates to repurchase them under certain circumstances; |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | engage in the purchase or sale of commodities or commodity contracts, including futures contracts, except for the purpose of hedging in the ordinary course of business or where necessary in working out distressed loan or investment situations; or |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | acquire more than 3% of the voting stock of, or invest more than 5% of our total assets in any securities issued by, any other investment company, except if we acquire them as part of a merger, consolidation or acquisition of assets or if they result from a sale of a portfolio company, or otherwise as permitted under the 1940 Act. |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (i) | 67% or more of such company’s shares present at a meeting if more than 50% of the outstanding shares of such company are present or represented by proxy; or |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (ii) | more than 50% of the outstanding shares of such company. |
|--------|------|----------------------------------------------------------|

|   | • | securities of an eligible portfolio company that are purchased in transactions not involving any public offering.  An eligible portfolio company is defined under the 1940 Act to include any issuer that: |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | is organized and has its principal place of business in the U.S.; |
|--------|---------|-------------------------------------------------------------------|

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|   | • | is not an investment company or a company operating pursuant to certain exemptions under the 1940 Act, other than a small business investment company wholly owned by a BDC; and |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | satisfies one of the following: |
|--------|---------|---------------------------------|

|   | • | does not have any class of publicly traded securities with respect to which a broker may extend margin credit; |
|--------|---------|----------------------------------------------------------------------------------------------------------------|

|   | • | does not have a class of securities listed on a national securities exchange or has a class of securities listed on a national securities exchange, but has an aggregate market value of outstanding voting and non-voting common equity of less than $250.0 million; |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | is controlled by the BDC and has an affiliate of a BDC on its board of directors; |
|--------|---------|-----------------------------------------------------------------------------------|

|   | • | has total assets of not more than $4.0 million and capital and surplus (stockholders’ equity less retained earnings) of not less than $2.0 million; or |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | meets such other criteria as may be established by the SEC; |
|--------|---------|-------------------------------------------------------------|

|   | • | securities received in exchange for or distributed with respect to securities described in the bullet above or pursuant to the exercise of options, warrants, or rights relating to those securities; and |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | cash, cash items, government securities, or high quality debt securities (as defined in the 1940 Act), maturing in one year or less from the time of investment. |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | • | our chief executive officer, chief financial officer and chief accounting officer must certify the accuracy of the financial statements contained in our periodic reports; |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | our periodic reports must disclose our conclusions about the effectiveness of our disclosure controls and procedures; |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------|

|   | • | our management must prepare a report regarding its assessment of our internal control over financial reporting; and |
|--------|---------|---------------------------------------------------------------------------------------------------------------------|

|   | • | our periodic reports must disclose whether there were significant changes in our internal controls or in other factors that could significantly affect these controls subsequent to the date of their evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses. |
|--------|---------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | • | qualify as a RIC, and |
|--------|---------|-----------------------|

|   | • | distribute each year to stockholders at least 90% of our investment company taxable income (which is defined in the Internal Revenue Code generally as ordinary income plus realized net short-term capital gains in excess of realized net long-term capital losses), and 90% of any ordinary pre-RIC built-in gains we recognize between January 1, 2002 and December 31, 2011, less our taxes due on those gains, which we collectively refer to as the 90% Distribution Requirement, |
|--------|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | continue to qualify as a BDC under the 1940 Act at all times during each taxable year; |
|--------|---------|----------------------------------------------------------------------------------------|

|   | • | derive in each taxable year at least 90% of our gross income from (1) dividends, interest, payments with respect to certain securities, loans, gains from the sale of stock or other securities, or other income derived with respect to our business of investing in such stock or securities and (2) net income derived from an interest in a “qualified publicly traded partnership;” and |
|--------|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | diversify our holdings so that at the end of each quarter of the taxable year: |
|--------|---------|--------------------------------------------------------------------------------|

|   | • | at least 50% of the value of our assets consists of cash, cash items, U.S. government securities, securities of other RICs, and other securities if such other securities of any one issuer do not represent more than 5% of the value of our assets or more than 10% of the outstanding voting securities of the issuer; and |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | • | no more than 25% of the value of our assets is invested in the securities, other than U.S.  government securities or securities of other RICs, of (i) one issuer, (ii) two or more issuers that are controlled, as determined under applicable Internal Revenue Code rules, by us and are engaged in the same or similar or related trades or businesses or (iii) one or more “qualified publicly traded partnerships,” known as the Diversification Tests. |
|--------|---------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | · | The annual distribution requirement for a RIC is satisfied if we distribute to our stockholders at least 90% of our ordinary income and realized net short-term capital gains in excess of realized net long-term capital losses, if any, on an annual basis.  Because we may use debt financing, we are subject to an asset coverage ratio requirement under the 1940 Act and we may be subject to certain financial covenants under our debt arrangements that could, under certain circumstances, restrict us from making distributions necessary to satisfy the distribution requirement.  If we are unable to obtain cash from other sources, we could fail to qualify for RIC tax treatment and thus become subject to corporate-level income tax. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | The income source requirement will be satisfied if we obtain at least 90% of our income for each year from dividends, interest, gains from the sale of stock or securities or similar sources. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | The asset diversification requirement will be satisfied if we meet certain asset diversification requirements at the end of each quarter of our taxable year. To satisfy this requirement, at least 50% of the value of our assets must consist of cash, cash equivalents, U.S. government securities, securities of other RICs, and other acceptable securities; and no more than 25% of the value of our assets can be invested in the securities, other than U.S. government securities or securities of other RICs, of one issuer, of two or more issuers that are controlled, as determined under applicable Code rules, by us and that are engaged in the same or similar or related trades or businesses or of certain “qualified publicly traded partnerships.” Failure to meet these requirements may result in our having to dispose of certain investments quickly in order to prevent the loss of RIC status. Because most of our investments will be in private companies, and, therefore, will be relatively illiquid, any such dispositions could be made at disadvantageous prices and could result in substantial losses. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | · | our quarterly results of operations; |
|--------|--------|--------------------------------------|

|   | · | our origination activity, including the pace of, and competition for, new investment opportunities; |
|--------|--------|-----------------------------------------------------------------------------------------------------|

|   | · | price and volume fluctuations in the overall stock market from time to time; |
|--------|--------|------------------------------------------------------------------------------|

|   | · | investors’ general perception of our company, the economy and general market conditions; |
|--------|--------|------------------------------------------------------------------------------------------------|

|   | · | actual or anticipated changes in our earnings or fluctuations in our operating results or changes in the expectations of securities analysts; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------|

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|   | · | the financial performance of the specific industries in which we invest on a recurring basis, including without limitation, our investments in the communications, cable and healthcare industries; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | significant transactions or capital commitments by us or our competitors; |
|--------|--------|---------------------------------------------------------------------------|

|   | · | significant volatility in the market price and trading volume of securities of BDCs or other financial services companies; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------|

|   | · | volatility resulting from trading in derivative securities related to our common stock including puts, calls or short trading positions; |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | changes in laws or regulatory policies or tax guidelines with respect to BDCs or RICs; |
|--------|--------|----------------------------------------------------------------------------------------|

|   | · | loss of RIC status; |
|--------|--------|---------------------|

|   | · | the loss of a major funding source, including one of our lenders; |
|--------|--------|-------------------------------------------------------------------|

|   | · | announcements of strategic developments, acquisitions and other material events by us or our competitors; or |
|--------|--------|--------------------------------------------------------------------------------------------------------------|

|   | · | departures of key personnel. |
|--------|--------|------------------------------|

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| Item 5. | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. |
|---------|---------------------------------------------------------------------------------------------------------------------|

|          |   | Years ended December 31, |   |
|---------------|--------|-------------------------------|--------|
|          |   | 2009                          |   |   | 2008 |   |
| Quarter Ended |   | High                          |   |   | Low |   |   | High |   |   | Low |   |
| March 31      |   | $                             | 1.70   |   |   | $ | 0.49 |   |   | $ | 13.61 |   |   | $ | 9.09 |   |
| June 30       |   | $                             | 2.61   |   |   | $ | 1.25 |   |   | $ | 8.46 |   |   | $ | 3.98 |   |
| September 30  |   | $                             | 4.19   |   |   | $ | 2.20 |   |   | $ | 4.90 |   |   | $ | 2.21 |   |
| December 31   |   | $                             | 4.91   |   |   | $ | 3.92 |   |   | $ | 2.38 |   |   | $ | 0.58 |   |

| Date Declared     | Record Date | Payment Date   | Amount |
|-------------------|-------------|----------------|--------|
| May 6, 2008       |        | June 30, 2008  |   | July 30, 2008 |   | $      0.27 |   |
| February 22, 2008 |        | March 12, 2008 |   | April 29, 2008 |   | 0.44 |   |

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| Measurement Date         |   | MCG Capital Corporation |   |   | NASDAQFinancial 100 |   |   | Russell 2000 |   |
|--------------------------|--------|-------------------------|--------|--------|---------------------|--------|--------|--------------|--------|
| 12/31/2004 (base period) |   | $                       | 100.00 |   |                | $      | 100.00 |         |   | $ | 100.00 |   |
| 6/30/2005                |   |                    | 105.05 |   |                |   | 96.50  |         |   |   | 98.75 |   |
| 12/31/2005               |   |                    | 94.41  |   |                |   | 99.87  |         |   |   | 104.55 |   |
| 6/30/2006                |   |                    | 108.70 |   |                |   | 101.17 |         |   |   | 113.14 |   |
| 12/31/2006               |   |                    | 145.67 |   |                |   | 110.47 |         |   |   | 123.76 |   |
| 6/30/2007                |   |                    | 120.78 |   |                |   | 109.04 |         |   |   | 131.74 |   |
| 12/31/2007               |   |                    | 93.49  |   |                |   | 99.71  |         |   |   | 121.82 |   |
| 6/30/2008                |   |                    | 35.64  |   |                |   | 78.17  |         |   |   | 110.40 |   |
| 12/31/2008               |   |                    | 6.36   |   |                |   | 68.76  |         |   |   | 80.66 |   |
| 6/30/2009                |   |                    | 21.76  |   |                |   | 62.06  |         |   |   | 82.79 |   |
| 12/31/2009               |   |                    | 38.69  |   |                |   | 69.66  |         |   |   | 102.58 |   |

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|                                                                                                                           |   | Years ended December 31, |      |
|--------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------|-----------|
| (in thousands, except per share and other period-end data)                                                                     |   | 2009                          |      |   | 2008 |   |   | 2007 |   |   | 2006 |   |   | 2005 |   |
| Income statement data                                                                                                          |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |
| Revenue                                                                                                                        |   | $                             | 99,834    |   |   | $ | 135,365 |   |   | $ | 187,119 |   |   | $ | 154,393 |   |   | $ | 119,545 |   |
| Net operating income before investment (loss) gain and income tax (benefit) provision                                          |   |                          | 38,188    |   |   |   | 56,090 |   |   |   | 101,918 |   |   |   | 83,644 |   |   |   | 60,515 |   |
| Net investment (loss) gain                                                                                                     |   |                          | (94,353   | ) |   |   | (257,601 | ) |   |   | (12,887 | ) |   |   | 20,017 |   |   |   | 7,678 |   |
| Distributable net operating income ("DNOI")(a)                                                                                 |   |                          | 45,915    |   |   |   | 66,902 |   |   |   | 110,942 |   |   |   | 87,114 |   |   |   | 64,936 |   |
| Net (loss) income                                                                                                              |   |                          | (51,059   | ) |   |   | (191,245 | ) |   |   | 86,636 |   |   |   | 100,949 |   |   |   | 68,193 |   |
| Per common share data                                                                                                          |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net operating income before investment (loss) gain and income tax (benefit) provision per common share—basic and diluted |   | $                             | 0.51      |   |   | $ | 0.78 |   |   | $ | 1.55 |   |   | $ | 1.46 |   |   | $ | 1.19 |   |
| DNOI per common share—basic and diluted(a)(b)                                                                            |   | $                             | 0.61      |   |   | $ | 0.93 |   |   | $ | 1.69 |   |   | $ | 1.52 |   |   | $ | 1.27 |   |
| (Loss) earnings per weighted-average common share—basic and diluted(b)                                                   |   | $                             | (0.68     | ) |   | $ | (2.65 | ) |   | $ | 1.32 |   |   | $ | 1.76 |   |   | $ | 1.34 |   |
| Cash dividends declared per common share                                                                                       |   | $                             | —   |   |   | $ | 0.71 |   |   | $ | 1.76 |   |   | $ | 1.68 |   |   | $ | 1.68 |   |
| Selected period-end balances                                                                                                   |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Investment portfolio balance                                                                                                   |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Fair value                                                                                                                     |   | $                             | 986,346   |   |   | $ | 1,203,148 |   |   | $ | 1,545,090 |   |   | $ | 1,248,073 |   |   | $ | 1,088,498 |   |
| Cost                                                                                                                           |   |                          | 1,154,924 |   |   |   | 1,470,123 |   |   |   | 1,564,401 |   |   |   | 1,233,166 |   |   |   | 1,108,193 |   |
| Total assets                                                                                                                   |   |                          | 1,191,149 |   |   |   | 1,312,434 |   |   |   | 1,637,581 |   |   |   | 1,319,268 |   |   |   | 1,244,487 |   |
| Borrowings                                                                                                                     |   |                          | 557,848   |   |   |   | 636,649 |   |   |   | 751,035 |   |   |   | 521,883 |   |   |   | 541,119 |   |
| Total stockholders' equity                                                                                                     |   |                          | 615,683   |   |   |   | 658,911 |   |   |   | 834,689 |   |   |   | 753,137 |   |   |   | 666,087 |   |
| Net asset value per common share outstanding(c)                                                                                |   | $                             | 8.06      |   |   | $ | 8.66 |   |   | $ | 12.73 |   |   | $ | 12.83 |   |   | $ | 12.48 |   |
| Other period-end data                                                                                                          |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Average size of investment                                                                                                     |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Fair value                                                                                                                     |   | $                             | 16,718    |   |   | $ | 17,188 |   |   | $ | 19,075 |   |   | $ | 15,037 |   |   | $ | 11,962 |   |
| Cost                                                                                                                           |   |                          | 19,575    |   |   |   | 21,002 |   |   |   | 19,314 |   |   |   | 14,857 |   |   |   | 12,178 |   |
| Number of portfolio companies                                                                                                  |   |                          | 59        |   |   |   | 70 |   |   |   | 81 |   |   |   | 83 |   |   |   | 91 |   |
| Number of employees(d)                                                                                                         |   |                          | 64        |   |   |   | 73 |   |   |   | 95 |   |   |   | 85 |   |   |   | 128 |   |
| Reconciliation of DNOI to net operating income before investment (loss) gain and income tax (benefit) provision                |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net operating income before investment (loss) gain and income tax (benefit) provision                                          |   | $                             | 38,188    |   |   | $ | 56,090 |   |   | $ | 101,918 |   |   | $ | 83,644 |   |   | $ | 60,515 |   |
| Amortization of employee restricted stock awards                                                                               |   |                          | 7,727     |   |   |   | 6,961 | (e) |   |   | 9,024 |   |   |   | 3,470 |   |   |   | 4,421 |   |
| Goodwill impairment                                                                                                            |   |                          | —   |   |   |   | 3,851 |   |   |   | — |   |   |   | — |   |   |   | — |   |
| DNOI                                                                                                                           |   | $                             | 45,915    |   |   | $ | 66,902 |   |   | $ | 110,942 |   |   | $ | 87,114 |   |   | $ | 64,936 |   |
|                                                                                                                           |   |                          |      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted-average common shares outstanding—basic and diluted                                                             |   |                          | 74,692    |   |   |   | 72,254 |   |   |   | 65,606 |   |   |   | 57,222 |   |   |   | 50,996 |   |
| Shares outstanding at end of year                                                                                              |   |                          | 76,394    |   |   |   | 76,075 |   |   |   | 65,587 |   |   |   | 58,694 |   |   |   | 53,372 |   |

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|   | (a) | DNOI is net operating income before investment gains and losses and income tax (benefit) provision, as determined in accordance with accounting principles generally accepted in the United States, or GAAP, adjusted for amortization of employee restricted stock awards and goodwill impairment.  We view DNOI and the related per share measures as useful and appropriate supplements to net operating income, net income, earnings per share and cash flows from operating activities.  These measures serve as an additional measure of MCG’s operating performance exclusive of employee restricted stock amortization and goodwill impairment charges, which represents an expense of the company but does not require settlement in cash.  DNOI does include paid-in-kind, or PIK, interest and dividend income which are generally not payable in cash on a regular basis but rather at investment maturity or when declared.  DNOI should not be considered as an alternative to net operating income, net income, earnings per share and cash flows from operating activities (each computed in accordance with GAAP).  Instead, DNOI should be reviewed in connection with net operating income, net income, earnings per share and cash flows from operating activities in MCG’s consolidated financial statements, to help analyze how MCG’s business is performing. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | In accordance with ASC 260—Earnings Per Share, we adjusted the weighted-average basic and diluted common shares outstanding for the three months ended March 31, 2008 to include participating restricted shares of common stock that received non-forfeitable dividends.  See Note 12—(Loss) Earnings Per Share for additional information.  The implementation of this standard did not change our previously reported earnings per share. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (c) | Based on common shares outstanding at period-end. |
|--------|-----|---------------------------------------------------|

|   | (d) | Includes 51 employees as of December 31, 2005 of our former subsidiary Kagan Research, LLC. |
|--------|-----|---------------------------------------------------------------------------------------------|

|   | (e) | Includes $106 of amortization of employee restricted stock awards associated with our corporate restructuring.  These expenses are reported as general and administrative expenses on our Consolidated Statements of Operations. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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It

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|   | · | in February 2009, we successfully renegotiated three credit facilities, which provide us with continuing debt financing with repayment terms that are tied to future monetizations, as well as relaxed key covenant requirements.  In October 2009, we also successfully renegotiated the maturity of our unsecured privately placed notes issued in 2005 from October 2010 to October 2011; |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the cash balance in our securitization and restricted accounts, which may be deployed for suitable new investment opportunities, has increased from $38.5 million as of December 31, 2008 to $130.4 million as of December 31, 2009.  In addition, we maintained a $54.2 million balance of unrestricted cash and cash equivalents as of December 31, 2009; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | · | since beginning our deleveraging initiatives in July 2008, we completed $285.8 million of investment monetizations, including $168.0 million during 2009; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the fair value losses on our investment portfolio have declined.  During the year ended December 31, 2009, we recorded a $94.4 million loss on the fair value of our portfolio and other assets compared to a $257.6 million loss during 2008; and |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | during the year ended December 31, 2009, we reported a loss per share of $0.68, compared with a $2.65 loss per share during 2008. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------|

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|   | · | the February 2009 sale of our equity investment in LMS Intellibound Investors, LLC, or LMS, for $40.5 million, or $16.3 million and $4.1 million above the most recently reported respective cost and fair value; as well as the $10.2 million prepayment of our subordinated debt investment in LMS at par in June 2009; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the February 2009 repayment of our $21.5 million second-lien debt investment in Dayton Parts Holding, LLC at par and $0.9 million above its most previously reported fair value; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the April 2009 monetization of our senior debt and equity investment in TNR Holdings Corp., or TNR, for $11.6 million.  Our monetization of TNR represents a distressed sale, which was completed at 23.8% and 42.3% of our most recently reported cost and fair value, respectively, which we exited after three major customers notified TNR that they did not intend to renew their contracts; |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the June 2009 repayment of our $18.7 million senior debt investment in Cervalis, LLC at par and $0.4 million above the most recently reported fair value; |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the August 2009 sale of our equity investment in Coastal Sunbelt Holdings, Inc for $15.2 million, or 98% of its most recently reported cost and fair value; and |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | the December 2009 repayment of our senior debt investment in Tegra Medical Holdings, LLC, or Tegra  for $25.5 million, or $0.2 million above the most recently reported cost and fair value, and the sale of our equity investment in Tegra for $1.5 million, or $0.5 million above the most recently reported cost and fair value. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                             |   | December 31, 2009    |    |   | December 31, 2008     |   |
|----------------------------------|--------|---------------------------|---------|--------|----------------------------|--------|
| (dollars in thousands)           |   | Investments at Fair Value |    |   | Percent of Total Portfolio |   |   | Investments at Fair Value |   |   | Percent of Total Portfolio |   |
| Debt investments                 |   |                      |    |   |                       |   |   |   |   |   |   |   |
| Senior secured debt              |   | $                         | 379,457 |   |                       |   | 38.5 | % |   | $ | 428,817 |   |   |   | 35.7 | % |
| Subordinated debt                |   |                      |    |   |                       |   |   |   |   |   |   |   |   |   |   |   |
| Secured                          |   |                      | 275,398 |   |                       |   | 27.9 |   |   |   | 351,425 |   |   |   | 29.2 |   |
| Unsecured                        |   |                      | 30,618  |   |                       |   | 3.1 |   |   |   | 28,081 |   |   |   | 2.3 |   |
| Total debt investments           |   |                      | 685,473 |   |                       |   | 69.5 |   |   |   | 808,323 |   |   |   | 67.2 |   |
| Equity investments               |   |                      |    |   |                       |   |   |   |   |   |   |   |   |   |   |   |
| Preferred equity                 |   |                      | 257,984 |   |                       |   | 26.2 |   |   |   | 339,576 |   |   |   | 28.2 |   |
| Common/common equivalents equity |   |                      | 42,889  |   |                       |   | 4.3 |   |   |   | 55,249 |   |   |   | 4.6 |   |
| Total equity investments         |   |                      | 300,873 |   |                       |   | 30.5 |   |   |   | 394,825 |   |   |   | 32.8 |   |
| Total investments                |   | $                         | 986,346 |   |                       |   | 100.0 | % |   | $ | 1,203,148 |   |   |   | 100.0 | % |

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|                                                                |   | December 31, 2009    |    |   | December 31, 2008          |   |
|---------------------------------------------------------------------|--------|---------------------------|---------|--------|---------------------------------|--------|
| (dollars in thousands)                                              |   | Investments at Fair Value |    |   | Percent of Total Portfolio |   |   | Investments at Fair Value |   |   | Percent of Total Portfolio |   |
| Telecommunications—CLEC (competitive local exchange carriers) |   | $                         | 170,129 |   |                            |   | 17.2 | % |   | $ | 173,789 |   |   |   | 14.4 | % |
| Communications—other                                          |   |                      | 18,020  |   |                            |   | 1.8 |   |   |   | 17,403 |   |   |   | 1.5 |   |
| Cable                                                               |   |                      | 128,386 |   |                            |   | 13.0 |   |   |   | 119,134 |   |   |   | 9.9 |   |
| Healthcare                                                          |   |                      | 100,278 |   |                            |   | 10.2 |   |   |   | 123,589 |   |   |   | 10.3 |   |
| Food services                                                       |   |                      | 70,035  |   |                            |   | 7.1 |   |   |   | 81,935 |   |   |   | 6.8 |   |
| Plastic products                                                    |   |                      | 57,449  |   |                            |   | 5.8 |   |   |   | 45,317 |   |   |   | 3.8 |   |
| Broadcasting                                                        |   |                      | 52,255  |   |                            |   | 5.3 |   |   |   | 66,401 |   |   |   | 5.5 |   |
| Electronics                                                         |   |                      | 42,082  |   |                            |   | 4.3 |   |   |   | 42,018 |   |   |   | 3.5 |   |
| Sporting goods                                                      |   |                      | 39,103  |   |                            |   | 4.0 |   |   |   | 36,531 |   |   |   | 3.0 |   |
| Business services                                                   |   |                      | 37,455  |   |                            |   | 3.8 |   |   |   | 77,213 |   |   |   | 6.4 |   |
| Laboratory instruments                                              |   |                      | 34,790  |   |                            |   | 3.5 |   |   |   | 35,054 |   |   |   | 2.9 |   |
| Logistics                                                           |   |                      | 31,694  |   |                            |   | 3.2 |   |   |   | 66,950 |   |   |   | 5.6 |   |
| Publishing                                                          |   |                      | 31,093  |   |                            |   | 3.2 |   |   |   | 34,743 |   |   |   | 2.9 |   |
| Technology                                                          |   |                      | 27,595  |   |                            |   | 2.8 |   |   |   | 35,980 |   |   |   | 3.0 |   |
| Education                                                           |   |                      | 24,127  |   |                            |   | 2.5 |   |   |   | 29,062 |   |   |   | 2.4 |   |
| Insurance                                                           |   |                      | 22,815  |   |                            |   | 2.3 |   |   |   | 21,258 |   |   |   | 1.8 |   |
| Home furnishings                                                    |   |                      | 21,050  |   |                            |   | 2.1 |   |   |   | 27,899 |   |   |   | 2.3 |   |
| Consumer products                                                   |   |                      | 18,665  |   |                            |   | 1.9 |   |   |   | 22,855 |   |   |   | 1.9 |   |
| Leisure activities                                                  |   |                      | 14,186  |   |                            |   | 1.4 |   |   |   | 13,816 |   |   |   | 1.2 |   |
| Other media                                                         |   |                      | 10,415  |   |                            |   | 1.1 |   |   |   | 11,940 |   |   |   | 1.0 |   |
| Drugs                                                               |   |                      | 10,213  |   |                            |   | 1.0 |   |   |   | 11,234 |   |   |   | 0.9 |   |
| Auto parts                                                          |   |                      | 8,720   |   |                            |   | 0.9 |   |   |   | 31,011 |   |   |   | 2.6 |   |
| Information services                                                |   |                      | 6,985   |   |                            |   | 0.7 |   |   |   | 13,618 |   |   |   | 1.1 |   |
| Entertainment                                                       |   |                      | 906     |   |                            |   | 0.1 |   |   |   | 28,268 |   |   |   | 2.4 |   |
| Industrial products                                                 |   |                      | — |   |                            |   | — |   |   |   | 26,246 |   |   |   | 2.2 |   |
| Other(a)                                                            |   |                      | 7,900   |   |                            |   | 0.8 |   |   |   | 9,884 |   |   |   | 0.7 |   |
| Total                                                               |   | $                         | 986,346 |   |                            |   | 100.0 | % |   | $ | 1,203,148 |   |   |   | 100.0 | % |

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|   | (a) | No individual industry within this category exceeds 1%. |
|--------|-----|---------------------------------------------------------|

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|                   |   | Investments at Fair Value |    |   | Revenue for the year ended |   |
|------------------------|--------|---------------------------|---------|--------|----------------------------|--------|
|                   |   | December 31, 2009    |    |   | December 31, 2008     |   |   | December 31, 2009 |   |   | December 31, 2008 |   |
| (dollars in thousands) |   | Amount                    |    |   | % of Total Portfolio       |   |   | Amount |   |   | % of Total Portfolio |   |   | Amount |   |   | % of Total Revenue |   |   | Amount |   |   | % of Total Revenue |   |
| Industry               |   |                      |    |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Communications         |   | $                         | 188,149 |   |                       |   | 19.0 | % |   | $ | 191,192 |   |   |   | 15.9 | % |   | $ | 4,391 |   |   |   | 4.4 | % |   | $ | 15,539 |   |   |   | 11.5 | % |
| Cable                  |   |                      | 128,386 |   |                       |   | 13.0 |   |   |   | 119,134 |   |   |   | 9.9 |   |   |   | 11,036 |   |   |   | 11.1 |   |   |   | 10,512 |   |   |   | 7.8 |   |
| Healthcare             |   |                      | 100,278 |   |                       |   | 10.2 |   |   |   | 123,589 |   |   |   | 10.3 |   |   |   | 11,593 |   |   |   | 11.6 |   |   |   | 15,230 |   |   |   | 11.3 |   |
| Food services          |   |                      | 70,035  |   |                       |   | 7.1 |   |   |   | 81,935 |   |   |   | 6.8 |   |   |   | 11,553 |   |   |   | 11.6 |   |   |   | 11,004 |   |   |   | 8.1 |   |

|                                               |   | Years ended December 31, |      |
|----------------------------------------------------|--------|-------------------------------|-----------|
| (in thousands)                                     |   | 2009                          |      |   | 2008 |   |
| Beginning investment portfolio                     |   | $                             | 1,203,148 |   |   | $ | 1,545,090 |   |
| Originations and advances                          |   |                          | 82,640    |   |   |   | 124,981 |   |
| Gross payments, reductions and sales of securities |   |                          | (207,203  | ) |   |   | (212,601 | ) |
| Net unrealized loss                                |   |                          | (96,681   | ) |   |   | (251,175 | ) |
| Net realized loss                                  |   |                          | (191,820  | )(a) |   |   | (9,173 | ) |
| Amortization of unearned income                    |   |                          | 1,184     |   |   |   | 2,515 |   |
| Reversals of unrealized depreciation               |   |                          | 195,078   | (a) |   |   | 3,511 |   |
| Ending investment portfolio                        |   | $                             | 986,346   |   |   | $ | 1,203,148 |   |

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|   | (a) | Reflects the realization of $150,135 of losses on Cleartel Communications, Inc. upon the establishment of a liquidating trust in December 2009. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------|

|                             |   | Years ended December 31, |    |
|----------------------------------|--------|-------------------------------|---------|
|                             |   | 2009                          |    |   | 2008 |   |
| (dollars in thousands)           |   | Amount                        |    |   | % of Total |   |   | Amount |   |   | % of Total |   |
| Debt investments                 |   |                          |    |   |   |   |   |   |   |   |   |   |
| Senior secured debt              |   | $                             | 51,036  |   |   |   | 61.8 | % |   | $ | 49,351 |   |   |   | 39.5 | % |
| Subordinated debt                |   |                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Secured                          |   |                          | 16,011  |   |   |   | 19.4 |   |   |   | 46,796 |   |   |   | 37.4 |   |
| Unsecured                        |   |                          | 3,900   |   |   |   | 4.7 |   |   |   | 1,823 |   |   |   | 1.5 |   |
| Total debt investments           |   |                          | 70,947  |   |   |   | 85.9 |   |   |   | 97,970 |   |   |   | 78.4 |   |
| Equity investments               |   |                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Preferred equity                 |   |                          | 11,693  |   |   |   | 14.1 |   |   |   | 26,973 |   |   |   | 21.6 |   |
| Common/common equivalents equity |   |                          | — |   |   |   | — |   |   |   | 38 |   |   |   | — |   |
| Total equity investments         |   |                          | 11,693  |   |   |   | 14.1 |   |   |   | 27,011 |   |   |   | 21.6 |   |
| Total originations and advances  |   | $                             | 82,640  |   |   |   | 100.0 | % |   | $ | 124,981 |   |   |   | 100.0 | % |

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|                                                     |   | Years ended December 31, |    |
|----------------------------------------------------------|--------|-------------------------------|---------|
|                                                     |   | 2009                          |    |   | 2008 |   |
| (dollars in thousands)                                   |   | Amount                        |    |   | % of Total |   |   | Amount |   |   | % of Total |   |
| Debt investments                                         |   |                          |    |   |   |   |   |   |   |   |   |   |
| Senior secured debt                                      |   | $                             | 89,097  |   |   |   | 43.0 | % |   | $ | 124,326 |   |   |   | 58.5 | % |
| Subordinated secured debt                                |   |                          | 46,365  |   |   |   | 22.4 |   |   |   | 58,478 |   |   |   | 27.5 |   |
| Total debt investments                                   |   |                          | 135,462 |   |   |   | 65.4 |   |   |   | 182,804 |   |   |   | 86.0 |   |
| Equity investments                                       |   |                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Preferred equity                                         |   |                          | 67,259  |   |   |   | 32.5 |   |   |   | 18,003 |   |   |   | 8.5 |   |
| Common/common equivalents equity                         |   |                          | 4,482   |   |   |   | 2.1 |   |   |   | 11,794 |   |   |   | 5.5 |   |
| Total equity investments                                 |   |                          | 71,741  |   |   |   | 34.6 |   |   |   | 29,797 |   |   |   | 14.0 |   |
| Total gross payments, reductions and sales of securities |   | $                             | 207,203 |   |   |   | 100.0 | % |   | $ | 212,601 |   |   |   | 100.0 | % |

|                                                      |   | Years ended December 31, |    |
|-----------------------------------------------------------|--------|-------------------------------|---------|
| (in thousands)                                            |   | 2009                          |    |   | 2008 |   |
| Principal repayments and loan sales                       |   | $                             | 95,535  |   |   | $ | 127,722 |   |
| Sale of equity investments                                |   |                          | 63,327  |   |   |   | 22,726 |   |
| Scheduled principal amortization                          |   |                          | 37,713  |   |   |   | 52,106 |   |
| Collection of accrued paid-in-kind interest and dividends |   |                          | 10,628  |   |   |   | 10,047 |   |
| Total gross payments, reductions and sales of securities  |   | $                             | 207,203 |   |   | $ | 212,601 |   |

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|                                                     |   | Year ended December 31, 2009 |    |
|----------------------------------------------------------|--------|-----------------------------------|---------|
| (in thousands)                                           |   | Principal Repayments              |    |   | Sale of Equity Investments |   |   | PIK Interest and Dividend Prepayments |   |   | Total |   |
| Monetizations                                            |   |                              |    |   |   |   |   |   |   |   |   |   |
| LMS Intellibound Investors, LLC                          |   | $                                 | 10,000  |   |   | $ | 35,907 |   |   | $ | 4,729 |   |   | $ | 50,636 |   |
| Tegra Medical Holdings, LLC                              |   |                              | 25,492  |   |   |   | 1,500 |   |   |   | — |   |   |   | 26,992 |   |
| Dayton Parts Holdings, LLC                               |   |                              | 21,500  |   |   |   | — |   |   |   | — |   |   |   | 21,500 |   |
| Cervalis LLC                                             |   |                              | 18,688  |   |   |   | — |   |   |   | — |   |   |   | 18,688 |   |
| Coastal Sunbelt, LLC                                     |   |                              | — |   |   |   | 12,066 |   |   |   | 3,138 |   |   |   | 15,204 |   |
| TNR Holdings Corp.                                       |   |                              | 2,000   |   |   |   | 9,622 |   |   |   | — |   |   |   | 11,622 |   |
| Cyrus Networks, LLC                                      |   |                              | 11,232  |   |   |   | — |   |   |   | — |   |   |   | 11,232 |   |
| CWP/RMK Acquisition Corp.                                |   |                              | 5,150   |   |   |   | — |   |   |   | 300 |   |   |   | 5,450 |   |
| Crystal Media Network, LLC                               |   |                              | — |   |   |   | 2,556 |   |   |   | — |   |   |   | 2,556 |   |
| Jenzabar, Inc.                                           |   |                              | — |   |   |   | 1,250 |   |   |   | 575 |   |   |   | 1,825 |   |
| CEI Holdings Inc.                                        |   |                              | 665     |   |   |   | — |   |   |   | — |   |   |   | 665 |   |
| Partminer, Inc.                                          |   |                              | 250     |   |   |   | — |   |   |   | 354 |   |   |   | 604 |   |
| XFone, Inc.                                              |   |                              | — |   |   |   | 426 |   |   |   | — |   |   |   | 426 |   |
| Flexsol Packaging Corp.                                  |   |                              | 308     |   |   |   | — |   |   |   | — |   |   |   | 308 |   |
| Marietta Intermediate Holding Corporation                |   |                              | 250     |   |   |   | — |   |   |   | — |   |   |   | 250 |   |
| Total monetizations                                      |   |                              | 95,535  |   |   |   | 63,327 |   |   |   | 9,096 |   |   |   | 167,958 |   |
| Other scheduled payments                                 |   |                              | 37,713  |   |   |   | — |   |   |   | 1,532 |   |   |   | 39,245 |   |
| Total gross payments, reductions and sales of securities |   | $                                 | 133,248 |   |   | $ | 63,327 |   |   | $ | 10,628 |   |   | $ | 207,203 |   |

| Investment Rating | Summary Description                                                                                                                                              |
|-------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 1                 | Capital gain expected or realized                                                                                                                                |
| 2                 | Full return of principal and interest or dividend expected with customer performing in accordance with plan                                                      |
| 3                 | Full return of principal and interest or dividend expected, but customer requires closer monitoring                                                              |
| 4                 | Some loss of interest or dividend expected, but still expect an overall positive internal rate of return on the investment                                       |
| 5                 | Loss of interest or dividend and some loss of principal investment expected, which would result in an overall negative internal rate of return on the investment |

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| (dollars in thousands) |   |   | December 31, 2009    |    |   | December 31, 2008 |   |
|------------------------|--------|--------|---------------------------|---------|--------|------------------------|--------|
| Investment Rating      |   |   | Investments at Fair Value |    |   | % of Total Portfolio   |   |   | Investments atFair Value |   |   | % of Total Portfolio |   |
| 1                      |   |   | $                         | 573,231 | (a)    |                   |   | 58.1 | % |   | $ | 719,765 | (a) |   |   | 59.8 | % |
| 2                      |   |   |                      | 125,222 |   |                   |   | 12.7 |   |   |   | 206,829 |   |   |   | 17.2 |   |
| 3                      |   |   |                      | 271,447 |   |                   |   | 27.5 |   |   |   | 233,172 |   |   |   | 19.4 |   |
| 4                      |   |   |                      | 3,394   |   |                   |   | 0.4 |   |   |   | 32,648 |   |   |   | 2.7 |   |
| 5                      |   |   |                      | 13,052  |   |                   |   | 1.3 |   |   |   | 10,734 |   |   |   | 0.9 |   |
| Total                  |   |   | $                         | 986,346 |   |                   |   | 100.0 | % |   | $ | 1,203,148 |   |   |   | 100.0 | % |

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|   | (a) | As of December 31, 2009 and 2008, Investment Rating “1” included $218.6 million and $362.9 million, respectively, of loans to companies in which we also held equity securities. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                      |   | December 31, 2009 |    |   | December 31, 2008 |   |
|-------------------------------------------|--------|------------------------|---------|--------|------------------------|--------|
| (dollars in thousands)                    |   | Investments at Cost    |    |   | % of Loan Portfolio    |   |   | Investments at Cost |   |   | % of Loan Portfolio |   |
| Loans greater than 90 days past due       |   |                   |    |   |                   |   |   |   |   |   |   |   |
| On non-accrual status                     |   | $                      | 22,377  |   |                   |   | 2.91 | % |   | $ | 10,060 |   |   |   | 1.10 | % |
| Not on non-accrual status                 |   |                   | — |   |                   |   | — |   |   |   | — |   |   |   | — |   |
| Total loans greater than 90 days past due |   | $                      | 22,377  |   |                   |   | 2.91 | % |   | $ | 10,060 |   |   |   | 1.10 | % |
| Loans on non-accrual status               |   |                   |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| 0 to 90 days past due                     |   | $                      | 60,629  |   |                   |   | 7.89 | % |   | $ | 109,424 |   |   |   | 11.90 | % |
| Greater than 90 days past due             |   |                   | 22,377  |   |                   |   | 2.91 |   |   |   | 10,060 |   |   |   | 1.10 |   |
| Total loans on non-accrual status         |   | $                      | 83,006  |   |                   |   | 10.80 | % |   | $ | 119,484 |   |   |   | 13.00 | % |

|                                      |   | December 31, 2009    |    |   | December 31, 2008 |   |
|-------------------------------------------|--------|---------------------------|---------|--------|------------------------|--------|
| (dollars in thousands)                    |   | Investments at Fair Value |    |   | % of Loan Portfolio    |   |   | Investments at Fair Value |   |   | % of Loan Portfolio |   |
| Loans greater than 90 days past due       |   |                      |    |   |                   |   |   |   |   |   |   |   |
| On non-accrual status                     |   | $                         | 6,049   |   |                   |   | 0.88 | % |   | $ | 695 |   |   |   | 0.09 | % |
| Not on non-accrual status                 |   |                      | — |   |                   |   | — |   |   |   | — |   |   |   | — |   |
| Total loans greater than 90 days past due |   | $                         | 6,049   |   |                   |   | 0.88 | % |   | $ | 695 |   |   |   | 0.09 | % |
| Loans on non-accrual status               |   |                      |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| 0 to 90 days past due                     |   | $                         | 19,575  |   |                   |   | 2.86 | % |   | $ | 38,619 |   |   |   | 4.77 | % |
| Greater than 90 days past due             |   |                      | 6,049   |   |                   |   | 0.88 |   |   |   | 695 |   |   |   | 0.09 |   |
| Total loans on non-accrual status         |   | $                         | 25,624  |   |                   |   | 3.74 | % |   | $ | 39,314 |   |   |   | 4.86 | % |

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|                                                     |   | Year ended             |    |
|----------------------------------------------------------|--------|------------------------|---------|
|                                                     |   | December 31, 2009 |    |
| (In thousands)                                           |   | Cost                   |    |   | Fair Value |   |
| Beginning non-accrual loan balance                       |   | $                      | 119,484 |   |   | $ | 39,314 |   |
| Additional loans on non-accrual status—by industry |   |                   |    |   |   |   |   |   |
| Broadcasting                                             |   |                   | 11,463  |   |   |   | 6,025 |   |
| Business services                                        |   |                   | 8,150   |   |   |   | 149 |   |
| Healthcare                                               |   |                   | 12,112  |   |   |   | 5,271 |   |
| Home furnishings                                         |   |                   | 11,930  |   |   |   | 10,296 |   |
| Information services                                     |   |                   | 5,996   |   |   |   | 896 |   |
| Total additional loans on non-accrual status             |   |                   | 49,651  |   |   |   | 22,637 |   |
| Loans placed back on accrual status—Broadcasting   |   |                   | (19,721 | ) |   |   | (19,557 | ) |
| Advances to companies on non-accrual status              |   |                   | 1,350   |   |   |   | 1,350 |   |
| Loans converted to equity                                |   |                   | (10,731 | ) |   |   | — |   |
| Payments received on loans on non-accrual status         |   |                   | (9,483  | ) |   |   | (9,483 | ) |
| Change in unrealized loss on non-accrual loans           |   |                   | — |   |   |   | 38,907 |   |
| Realized loss on non-accrual loans                       |   |                   | (47,544 | ) |   |   | (47,544 | ) |
| Total change in non-accrual loans                        |   |                   | (36,478 | ) |   |   | (13,690 | ) |
| Ending non-accrual loan balance                          |   | $                      | 83,006  |   |   | $ | 25,624 |   |

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|                                                                                                               |   | Years ended       |    |   |     |   |
|--------------------------------------------------------------------------------------------------------------------|--------|-------------------|---------|--------|----------|--------|
|                                                                                                               |   | December 31, |    |   | Variance |   |
| (dollars in thousands)                                                                                             |   | 2009              |    |   | 2008     |   |   | $ |   |   | Percentage |   |
| Revenue                                                                                                            |   |              |    |   |     |   |   |   |   |   |   |   |   |
| Interest and dividend income                                                                                       |   |              |    |   |     |   |   |   |   |   |   |   |   |
| Interest income                                                                                                    |   | $                 | 88,309  |   |     | $      | 108,855 |   |   | $ | (20,546 | ) |   |   | (18.9 | )% |
| Dividend income                                                                                                    |   |              | 6,149   |   |     |   | 19,973 |   |   |   | (13,824 | ) |   |   | (69.2 | ) |
| Loan fees                                                                                                          |   |              | 2,848   |   |     |   | 3,427 |   |   |   | (579 | ) |   |   | (16.9 | ) |
| Total interest and dividend income                                                                                 |   |              | 97,306  |   |     |   | 132,255 |   |   |   | (34,949 | ) |   |   | (26.4 | ) |
| Advisory fees and other income                                                                                     |   |              | 2,528   |   |     |   | 3,110 |   |   |   | (582 | ) |   |   | (18.7 | ) |
| Total revenue                                                                                                      |   |              | 99,834  |   |     |   | 135,365 |   |   |   | (35,531 | ) |   |   | (26.2 | ) |
| Operating expenses                                                                                                 |   |              |    |   |     |   |   |   |   |   |   |   |   |   |   |   |
| Interest expense                                                                                                   |   |              | 23,444  |   |     |   | 35,431 |   |   |   | (11,987 | ) |   |   | (33.8 | ) |
| Employee compensation                                                                                              |   |              |    |   |     |   |   |   |   |   |   |   |   |   |   |   |
| Salaries and benefits                                                                                              |   |              | 14,825  |   |     |   | 16,490 |   |   |   | (1,665 | ) |   |   | (10.1 | ) |
| Amortization of employee restricted stock                                                                          |   |              | 7,727   |   |     |   | 6,855 |   |   |   | 872 |   |   |   | 12.7 |   |
| Total employee compensation                                                                                        |   |              | 22,552  |   |     |   | 23,345 |   |   |   | (793 | ) |   |   | (3.4 | ) |
| General and administrative expense                                                                                 |   |              | 15,650  |   |     |   | 16,648 |   |   |   | (998 | ) |   |   | (6.0 | ) |
| Goodwill impairment                                                                                                |   |              | — |   |     |   | 3,851 |   |   |   | (3,851 | ) |   |   | (100.0 | ) |
| Total operating expenses                                                                                           |   |              | 61,646  |   |     |   | 79,275 |   |   |   | (17,629 | ) |   |   | (22.2 | ) |
| Net operating income before net investment loss, gain on extinguishment of debt and income tax (benefit) provision |   |              | 38,188  |   |     |   | 56,090 |   |   |   | (17,902 | ) |   |   | (31.9 | ) |
| Net investment loss before gain on extinguishment of debt and income tax (benefit) provision                       |   |              | (94,353 | )      |     |   | (257,601 | ) |   |   | 163,248 |   |   |   | 63.4 |   |
| Gain on extinguishment of debt                                                                                     |   |              | 5,025   |   |     |   | 11,055 |   |   |   | (6,030 | ) |   |   | (54.5 | ) |
| Income tax (benefit) provision                                                                                     |   |              | (81     | )      |     |   | 789 |   |   |   | (870 | ) |   | NM |   |
| Net loss                                                                                                           |   | $                 | (51,059 | )      |     | $      | (191,245 | ) |   | $ | 140,186 |   |   |   | 73.3 |   |

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|                                    |   | Years ended December 31, |   |
|-----------------------------------------|--------|-------------------------------|--------|
| (in thousands)                          |   | 2009                          |   |   | 2008 |   |
| Beginning PIK loan balance              |   | $                             | 26,354 |   |   | $ | 17,685 |   |
| PIK interest earned during the period   |   |                          | 15,583 |   |   |   | 14,276 |   |
| Interest receivable converted to PIK    |   |                          | 3,274  |   |   |   | 5,004 |   |
| Principal payments of cash on PIK loans |   |                          | (2,214 | ) |   |   | (6,230 | ) |
| PIK converted to other securities       |   |                          | (9,262 | ) |   |   | (4,381 | ) |
| Realized loss                           |   |                          | (299   | ) |   |   | — |   |
| Ending PIK loan balance                 |   | $                             | 33,436 |   |   | $ | 26,354 |   |

|                                            |   | Years ended December 31, |   |
|-------------------------------------------------|--------|-------------------------------|--------|
| (in thousands)                                  |   | 2009                          |   |   | 2008 |   |
| Beginning accrued dividend balance              |   | $                             | 91,770 |   |   | $ | 75,614 |   |
| Dividend income earned during the period        |   |                          | 6,149  |   |   |   | 19,973 |   |
| Payment of dividends                            |   |                          | (8,414 | ) |   |   | (3,817 | ) |
| Accrued dividends converted to other securities |   |                          | (607   | ) |   |   | — |   |
| Ending accrued dividend balance                 |   | $                             | 88,898 |   |   | $ | 91,770 |   |

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|                                                                                                                                                       |   | Years ended December 31, |    |
|------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------|---------|
| (in thousands, except per share data)                                                                                                                      |   | 2009                          |    |   | 2008 |   |
| Net operating income before net investment loss, gain on extinguishment of debt and income tax (benefit) provision                                         |   | $                             | 38,188  |   |   | $ | 56,090 |   |
| Amortization of employee restricted stock awards                                                                                                           |   |                          | 7,727   |   |   |   | 6,961 | (b) |
| Goodwill impairment                                                                                                                                        |   |                          | — |   |   |   | 3,851 |   |
| DNOI                                                                                                                                                       |   | $                             | 45,915  |   |   | $ | 66,902 |   |
| Weighted-average common shares outstanding—basic and diluted                                                                                         |   |                          | 74,692  |   |   |   | 72,254 |   |
| Loss per common share—basic and diluted                                                                                                              |   | $                             | (0.68   | ) |   | $ | (2.65 | ) |
| Net operating income before net investment loss, gain on extinguishment of debt andincome tax (benefit) provision per common share—basic and diluted |   | $                             | 0.51    |   |   | $ | 0.78 |   |
| DNOI per common share—basic and diluted(a)                                                                                                           |   | $                             | 0.61    |   |   | $ | 0.93 |   |

----

| (a) | DNOI is net operating income before net investment loss, gain on extinguishment of debt and income tax (benefit) provision, as determined in accordance with GAAP, adjusted for amortization of employee restricted stock awards and goodwill impairment.  Amortization of employee restricted stock awards and goodwill impairment represent non-cash company expense.  DNOI includes PIK, interest and dividend income that generally are not payable on a regular basis, but rather at maturity or when declared.  DNOI is not an alternative to measures computed in accordance with GAAP, such as net operating income, net income, earnings per share or cash flows.  Instead, DNOI is a non-GAAP metric that provides supplemental information about our business performance to consider together with GAAP measures. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | Includes $106 of amortization of employee restricted stock awards associated with our corporate restructuring. These expenses are reported as general and administrative expenses on our Consolidated Statements of Operations. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                    |   |                           |   |          |   | Year ended December 31, 2009 |     |
|---------------------------------------------------------|--------|--------------------------------|--------|---------------|--------|------------------------------|----------|
|   Portfolio Company                                |   |   Industry                |   |   Type   |   | Realized (Loss)/Gain         |     |   | Unrealized Appreciation (Depreciation) |   |   | Reversal of Unrealized (Appreciation)/ Depreciation |   |   | Net (Loss)/Gain |   |
| Total Sleep Holdings, Inc.                              |   | Healthcare                     |   | Control       |   | $                            | —  |   |   | $ | (24,624 | ) |   | $ | — |   |   | $ | (24,624 | ) |
| TNR Holdings Corp.                                      |   | Entertainment                  |   | Control       |   |                         | (36,716  | ) |   |   | (15,801 | ) |   |   | 36,889 |   |   |   | (15,628 | ) |
| Stratford School Holdings, Inc.                         |   | Education                      |   | Affiliate     |   |                         | —  |   |   |   | (8,219 | ) |   |   | — |   |   |   | (8,219 | ) |
| Active Brands International, Inc.                       |   | Consumer Products              |   | Non-affiliate |   |                         | —  |   |   |   | (7,828 | ) |   |   | — |   |   |   | (7,828 | ) |
| NPS Holdings Group, LLC                                 |   | Business Services              |   | Control       |   |                         | (1,580   | ) |   |   | (7,272 | ) |   |   | 1,574 |   |   |   | (7,278 | ) |
| Jenzabar, Inc.                                          |   | Technology                     |   | Non-affiliate |   |                         | —  |   |   |   | (6,929 | ) |   |   | — |   |   |   | (6,929 | ) |
| GMC Television Broadcasting, LLC                        |   | Broadcasting                   |   | Control       |   |                         | —  |   |   |   | (6,200 | ) |   |   | — |   |   |   | (6,200 | ) |
| VOX Communications Group Holdings, LLC                  |   | Broadcasting                   |   | Non-affiliate |   |                         | —  |   |   |   | (4,779 | ) |   |   | — |   |   |   | (4,779 | ) |
| RadioPharmacy Investors, LLC                            |   | Healthcare                     |   | Control       |   |                         | —  |   |   |   | (3,410 | ) |   |   | — |   |   |   | (3,410 | ) |
| Summit Business Media Intermediate Holding Company, LLC |   | Information Services           |   | Non-affiliate |   |                         | —  |   |   |   | (3,366 | ) |   |   | — |   |   |   | (3,366 | ) |
| Cruz Bay Publishing, Inc.                               |   | Publishing                     |   | Non-Affiliate |   |                         | —  |   |   |   | (3,297 | ) |   |   | — |   |   |   | (3,297 | ) |
| CWP/RMK Acquisition Corp.                               |   | Home Furnishings               |   | Non-affiliate |   |                         | (10,692  | ) |   |   | (3,621 | ) |   |   | 11,509 |   |   |   | (2,804 | ) |
| Coastal Sunbelt Real Estate, Inc.                       |   | Real Estate Investments        |   | Non-affiliate |   |                         | —  |   |   |   | (2,706 | ) |   |   | — |   |   |   | (2,706 | ) |
| Jet Plastica Investors, LLC                             |   | Plastic Products               |   | Control       |   |                         | —  |   |   |   | (2,507 | ) |   |   | — |   |   |   | (2,507 | ) |
| Intran Media, LLC                                       |   | Other Media                    |   | Control       |   |                         | —  |   |   |   | (1,563 | ) |   |   | — |   |   |   | (1,563 | ) |
| Cleartel Communications, Inc.                           |   | Communications                 |   | Control       |   |                         | (150,212 | ) |   |   | (1,352 | ) |   |   | 150,136 |   |   |   | (1,428 | ) |
| Avenue Broadband LLC                                    |   | Cable                          |   | Control       |   |                         | —  |   |   |   | (1,309 | ) |   |   | — |   |   |   | (1,309 | ) |
| Construction Trailer Specialists, Inc.                  |   | Auto Parts                     |   | Non-affiliate |   |                         | —  |   |   |   | (1,245 | ) |   |   | — |   |   |   | (1,245 | ) |
| CEI Holdings Inc.                                       |   | Cosmetics                      |   | Non-affiliate |   |                         | (3,190   | ) |   |   | (926 | ) |   |   | 3,179 |   |   |   | (937 | ) |
| Flexsol Packaging Corp.                                 |   | Plastic Products               |   | Non-affiliate |   |                         | (2,821   | ) |   |   | (847 | ) |   |   | 2,772 |   |   |   | (896 | ) |
| B&H Education, Inc.                                 |   | Education                      |   | Non-affiliate |   |                         | —  |   |   |   | 3,204 |   |   |   | — |   |   |   | 3,204 |   |
| PremierGarage Holdings, LLC                             |   | Home Furnishings               |   | Control       |   |                         | —  |   |   |   | 1,497 |   |   |   | — |   |   |   | 1,497 |   |
| Cyrus Networks, LLC                                     |   | Business Services              |   | Non-affiliate |   |                         | —  |   |   |   | 1,406 |   |   |   | 34 |   |   |   | 1,440 |   |
| Golden Knight II CLO, Ltd.                              |   | Diversified Financial Services |   | Non-affiliate |   |                         | —  |   |   |   | 1,401 |   |   |   | — |   |   |   | 1,401 |   |
| LMS INTELLIBOUND, INC.                                  |   | Logistics                      |   | Control       |   |                         | 16,257   |   |   |   | — |   |   |   | (15,065 | ) |   |   | 1,192 |   |
| GSDM Holdings LLC                                       |   | Healthcare                     |   | Non-affiliate |   |                         | —  |   |   |   | 1,052 |   |   |   | — |   |   |   | 1,052 |   |
| Teleguam Holdings, LLC                                  |   | Communications                 |   | Non-affiliate |   |                         | —  |   |   |   | 1,024 |   |   |   | — |   |   |   | 1,024 |   |
| Marietta Intermediate Holding Corporation               |   | Cosmetics                      |   | Non-affiliate |   |                         | (1,832   | ) |   |   | — |   |   |   | 2,028 |   |   |   | 196 |   |
| XFone, Inc.                                             |   | Communications                 |   | Affiliate     |   |                         | (1,969   | ) |   |   | — |   |   |   | 1,969 |   |   |   | — |   |
| Other                                                   |   |                           |   |          |   |                         | 771      |   |   |   | 618 |   |   |   | 205 |   |   |   | 1,594 |   |
| Total                                                   |   |                           |   |          |   | $                            | (191,984 | ) |   | $ | (97,599 | ) |   | $ | 195,230 |   |   | $ | (94,353 | ) |

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| (in thousands)                                          |   |                           |   |          |   | Year ended December 31, 2008 |    |
|---------------------------------------------------------|--------|--------------------------------|--------|---------------|--------|------------------------------|---------|
|                                                    |   |                           |   |          |   | Realized Gain/(Loss)         |    |   | Unrealized Appreciation/ (Depreciation) |   |   | Reversal of Unrealized (Depreciation)/ Appreciation |   |   | Net Gain/(Loss) |   |
| Portfolio Company                                       |   | Industry                       |   | Type          |
| Broadview Networks Holdings, Inc.                       |   | Communications                 |   | Control       |   | $                            | — |   |   | $ | (58,218 | ) |   | $ | — |   |   | $ | (58,218 | ) |
| Jet Plastica Investors, LLC                             |   | Plastic Products               |   | Control       |   |                         | — |   |   |   | (40,411 | ) |   |   | — |   |   |   | (40,411 | ) |
| Cleartel Communications, Inc.                           |   | Communications                 |   | Control       |   |                         | — |   |   |   | (34,743 | ) |   |   | — |   |   |   | (34,743 | ) |
| Active Brands International, Inc.                       |   | Consumer Products              |   | Non-affiliate |   |                         | — |   |   |   | (13,681 | ) |   |   | — |   |   |   | (13,681 | ) |
| Working Mother Media, Inc.                              |   | Publishing                     |   | Control       |   |                         | (21,022 | ) |   |   | (7,089 | ) |   |   | 15,404 |   |   |   | (12,707 | ) |
| TNR Holdings Corp.                                      |   | Entertainment                  |   | Control       |   |                         | — |   |   |   | (12,261 | ) |   |   | — |   |   |   | (12,261 | ) |
| Superior Industries Investors, LLC                      |   | Sporting Goods                 |   | Control       |   |                         | — |   |   |   | (11,930 | ) |   |   | — |   |   |   | (11,930 | ) |
| National Product Services, Inc.                         |   | Business Services              |   | Control       |   |                         | — |   |   |   | (11,915 | ) |   |   | — |   |   |   | (11,915 | ) |
| GMC Television Broadcasting, LLC                        |   | Broadcasting                   |   | Control       |   |                         | — |   |   |   | (11,638 | ) |   |   | — |   |   |   | (11,638 | ) |
| InTran Media, LLC                                       |   | Other Media                    |   | Control       |   |                         | — |   |   |   | (8,208 | ) |   |   | — |   |   |   | (8,208 | ) |
| CWP/RMK Acquisition Corp.                               |   | Home Furnishings               |   | Non-affiliate |   |                         | — |   |   |   | (7,582 | ) |   |   | — |   |   |   | (7,582 | ) |
| PremierGarage Holdings, LLC                             |   | Home Furnishings               |   | Control       |   |                         | — |   |   |   | (5,553 | ) |   |   | — |   |   |   | (5,553 | ) |
| JetBroadband Holdings, LLC                              |   | Cable                          |   | Control       |   |                         | — |   |   |   | (5,253 | ) |   |   | — |   |   |   | (5,253 | ) |
| Coastal Sunbelt, LLC                                    |   | Food Services                  |   | Control       |   |                         | — |   |   |   | (5,139 | ) |   |   | — |   |   |   | (5,139 | ) |
| Philadelphia Newspapers, LLC                            |   | Newspaper                      |   | Non-affiliate |   |                         | — |   |   |   | (5,070 | ) |   |   | — |   |   |   | (5,070 | ) |
| RadioPharmacy Investors, LLC                            |   | Healthcare                     |   | Control       |   |                         | — |   |   |   | (4,696 | ) |   |   | — |   |   |   | (4,696 | ) |
| Total Sleep Holdings, Inc.                              |   | Healthcare                     |   | Control       |   |                         | — |   |   |   | (3,683 | ) |   |   | — |   |   |   | (3,683 | ) |
| Teleguam Holdings, LLC                                  |   | Communications                 |   | Non-affiliate |   |                         | — |   |   |   | (2,911 | ) |   |   | — |   |   |   | (2,911 | ) |
| GSDM Holdings, LLC                                      |   | Healthcare                     |   | Non-affiliate |   |                         | — |   |   |   | (2,759 | ) |   |   | — |   |   |   | (2,759 | ) |
| Cruz Bay Publishing, Inc.                               |   | Publishing                     |   | Non-affiliate |   |                         | — |   |   |   | (2,510 | ) |   |   | — |   |   |   | (2,510 | ) |
| Golden Knight II CLO, Ltd.                              |   | Diversified Financial Services |   | Non-affiliate |   |                         | — |   |   |   | (2,321 | ) |   |   | — |   |   |   | (2,321 | ) |
| Orbitel Holdings, LLC                                   |   | Cable                          |   | Control       |   |                         | — |   |   |   | (2,184 | ) |   |   | — |   |   |   | (2,184 | ) |
| XFone, Inc.                                             |   | Communications                 |   | Affiliate     |   |                         | — |   |   |   | (2,180 | ) |   |   | — |   |   |   | (2,180 | ) |
| G&L Investment Holdings, LLC                        |   | Insurance                      |   | Non-affiliate |   |                         | — |   |   |   | (1,993 | ) |   |   | — |   |   |   | (1,993 | ) |
| CEI Holdings Inc.                                       |   | Cosmetics                      |   | Non-affiliate |   |                         | — |   |   |   | (1,761 | ) |   |   | — |   |   |   | (1,761 | ) |
| Marietta Intermediate Holding Corporation               |   | Cosmetics                      |   | Non-affiliate |   |                         | — |   |   |   | (1,760 | ) |   |   | — |   |   |   | (1,760 | ) |
| Summit Business Media Intermediate Holding Company, LLC |   | Information Services           |   | Non-affiliate |   |                         | — |   |   |   | (1,734 | ) |   |   | — |   |   |   | (1,734 | ) |
| Legacy Cabinets, Inc.                                   |   | Home Furnishings               |   | Non-affiliate |   |                         | — |   |   |   | (1,561 | ) |   |   | — |   |   |   | (1,561 | ) |
| Advanced Sleep Concepts, Inc.                           |   | Home Furnishings               |   | Affiliate     |   |                         | — |   |   |   | (1,554 | ) |   |   | — |   |   |   | (1,554 | ) |
| Home Interiors & Gifts, Inc.                        |   | Home Furnishings               |   | Non-affiliate |   |                         | — |   |   |   | (1,481 | ) |   |   | — |   |   |   | (1,481 | ) |
| Cyrus Networks, LLC                                     |   | Business Services              |   | Non-affiliate |   |                         | — |   |   |   | (1,440 | ) |   |   | — |   |   |   | (1,440 | ) |
| Wireco Worldgroup Inc.                                  |   | Industrial Equipment           |   | Non-affiliate |   |                         | — |   |   |   | (1,276 | ) |   |   | — |   |   |   | (1,276 | ) |
| Sunshine Media Delaware, LLC                            |   | Publishing                     |   | Affiliate     |   |                         | — |   |   |   | (1,202 | ) |   |   | — |   |   |   | (1,202 | ) |
| Jenzabar, Inc.                                          |   | Technology                     |   | Non-affiliate |   |                         | — |   |   |   | 1,362 |   |   |   | — |   |   |   | 1,362 |   |
| JUPR Holdings, Inc.                                     |   | Information Services           |   | Control       |   |                         | 5,994   |   |   |   | 1,714 |   |   |   | (5,958 | ) |   |   | 1,750 |   |
| Wiesner Publishing Company, LLC                         |   | Publishing                     |   | Non-affiliate |   |                         | 5,344   |   |   |   | 2,169 |   |   |   | (5,503 | ) |   |   | 2,010 |   |
| MCI Holdings LLC                                        |   | Healthcare                     |   | Non-affiliate |   |                         | — |   |   |   | 4,553 |   |   |   | — |   |   |   | 4,553 |   |
| LMS Intellibound Investors, LLC                         |   | Logistics                      |   | Control       |   |                         | — |   |   |   | 6,714 |   |   |   | — |   |   |   | 6,714 |   |
| Avenue Broadband LLC                                    |   | Cable                          |   | Control       |   |                         | — |   |   |   | 7,033 |   |   |   | — |   |   |   | 7,033 |   |
| Stratford Schools Holdings, Inc.                        |   | Education                      |   | Affiliate     |   |                         | — |   |   |   | 9,366 |   |   |   | — |   |   |   | 9,366 |   |
| Other                                                   |   |                           |   |          |   |                         | 301     |   |   |   | (7,362 | ) |   |   | (13 | ) |   |   | (7,074 | ) |
| Total                                                   |   |                           |   |          |   | $                            | (9,383  | ) |   | $ | (252,148 | ) |   | $ | 3,930 |   |   | $ | (257,601 | ) |

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Table of Contents

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Table of Contents

|                                                                                                                    |   | 2009 Quarters |      |   | 2008 Quarters |   |
|-------------------------------------------------------------------------------------------------------------------------|--------|---------------|-----------|--------|---------------|--------|
| (in thousands, except per share amounts)                                                                                |   | Fourth        |      |   | Third         |   |   | Second |   |   | First |   |   | Fourth |   |   | Third |   |   | Second |   |   | First |   |
| Income Statement Data                                                                                                   |   |          |      |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Revenue                                                                                                                 |   | $             | 23,679    |   |          | $      | 23,611 |   |   | $ | 24,738 |   |   | $ | 27,806 |   |   | $ | 29,973 |   |   | $ | 31,296 |   |   | $ | 31,100 |   |   | $ | 42,996 |   |
| Net operating income before investment loss and income tax (benefit) provision                                          |   |          | 9,419     |   |          |   | 8,658 |   |   |   | 8,173 |   |   |   | 11,938 |   |   |   | 8,860 |   |   |   | 13,014 |   |   |   | 12,950 |   |   |   | 21,266 |   |
| DNOI (a)                                                                                                                |   |          | 11,543    |   |          |   | 10,937 |   |   |   | 9,960 |   |   |   | 13,475 |   |   |   | 14,178 |   |   |   | 14,904 |   |   |   | 14,812 |   |   |   | 23,008 |   |
| Net income (loss)                                                                                                       |   |          | 1,565     |   |          |   | 4,183 |   |   |   | (5,861 | ) |   |   | (50,946 | ) |   |   | (57,297 | ) |   |   | (66,946 | ) |   |   | (69,500 | ) |   |   | 2,498 |   |
| Per common Share Data                                                                                                   |   |          |      |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net operating income before investment loss and income tax (benefit) provision per common share—basic and diluted |   | $             | 0.12      |   |          | $      | 0.11 |   |   | $ | 0.11 |   |   | $ | 0.16 |   |   | $ | 0.12 |   |   | $ | 0.18 |   |   | $ | 0.18 |   |   | $ | 0.31 |   |
| DNOI per common share—basic and diluted(a)                                                                        |   | $             | 0.15      |   |          | $      | 0.14 |   |   | $ | 0.13 |   |   | $ | 0.18 |   |   | $ | 0.19 |   |   | $ | 0.20 |   |   | $ | 0.20 |   |   | $ | 0.33 |   |
| (Loss) earnings per common share—basic and diluted                                                                |   | $             | 0.02      |   |          | $      | 0.06 |   |   | $ | (0.08 | ) |   | $ | (0.68 | ) |   | $ | (0.77 | ) |   | $ | (0.90 | ) |   | $ | (0.96 | ) |   | $ | 0.04 |   |
| Cash dividends declared per common share                                                                                |   | $             | —   |   |          | $      | — |   |   | $ | — |   |   | $ | — |   |   | $ | — |   |   | $ | — |   |   | $ | 0.27 |   |   | $ | 0.44 |   |
| Selected period-end balances                                                                                            |   |          |      |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Investment portfolio                                                                                                    |   |          |      |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Fair value                                                                                                              |   | $             | 986,346   |   |          | $      | 1,037,244 |   |   | $ | 1,061,506 |   |   | $ | 1,114,992 |   |   | $ | 1,203,148 |   |   | $ | 1,296,469 |   |   | $ | 1,431,084 |   |   | $ | 1,512,416 |   |
| Cost                                                                                                                    |   |          | 1,154,924 |   |          |   | 1,359,774 |   |   |   | 1,385,048 |   |   |   | 1,464,198 |   |   |   | 1,470,123 |   |   |   | 1,487,535 |   |   |   | 1,552,035 |   |   |   | 1,550,944 |   |
| Total assets                                                                                                            |   |          | 1,191,149 |   |          |   | 1,194,387 |   |   |   | 1,203,839 |   |   |   | 1,255,340 |   |   |   | 1,312,434 |   |   |   | 1,386,054 |   |   |   | 1,506,595 |   |   |   | 1,574,686 |   |
| Borrowings                                                                                                              |   |          | 557,848   |   |          |   | 568,507 |   |   |   | 584,349 |   |   |   | 631,245 |   |   |   | 636,649 |   |   |   | 652,968 |   |   |   | 692,975 |   |   |   | 720,336 |   |
| Total stockholders’ equity                                                                                        |   |          | 615,683   |   |          |   | 611,967 |   |   |   | 605,478 |   |   |   | 609,531 |   |   |   | 658,911 |   |   |   | 714,679 |   |   |   | 779,530 |   |   |   | 810,203 |   |
| Net asset value per common share outstanding(b)                                                                         |   | $             | 8.06      |   |          | $      | 8.06 |   |   | $ | 7.97 |   |   | $ | 8.02 |   |   | $ | 8.66 |   |   | $ | 9.39 |   |   | $ | 10.31 |   |   | $ | 12.36 |   |
| Other Period-End Data                                                                                                   |   |          |      |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Average size of investment                                                                                              |   |          |      |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Fair value                                                                                                              |   | $             | 16,718    |   |          | $      | 15,958 |   |   | $ | 15,843 |   |   | $ | 15,704 |   |   | $ | 17,188 |   |   | $ | 17,760 |   |   | $ | 18,586 |   |   | $ | 19,145 |   |
| Cost                                                                                                                    |   |          | 19,575    |   |          |   | 20,920 |   |   |   | 20,672 |   |   |   | 20,623 |   |   |   | 21,002 |   |   |   | 20,377 |   |   |   | 20,156 |   |   |   | 19,632 |   |
| Number of portfolio companies                                                                                           |   |          | 59        |   |          |   | 65 |   |   |   | 67 |   |   |   | 71 |   |   |   | 70 |   |   |   | 73 |   |   |   | 77 |   |   |   | 79 |   |
| Number of employees                                                                                                     |   |          | 64        |   |          |   | 66 |   |   |   | 68 |   |   |   | 70 |   |   |   | 73 |   |   |   | 74 |   |   |   | 99 |   |   |   | 98 |   |
| Reconciliation of DNOI to net operating income before investment loss and tax (benefit) provision                       |   |          |      |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net operating income before investment loss and income tax (benefit) provision                                          |   | $             | 9,419     |   |          | $      | 8,658 |   |   | $ | 8,173 |   |   | $ | 11,938 |   |   | $ | 8,860 |   |   | $ | 13,014 |   |   | $ | 12,950 |   |   | $ | 21,266 |   |
| Amortization of employee restricted stock awards(e)                                                                     |   |          | 2,124     |   |          |   | 2,279 |   |   |   | 1,787 |   |   |   | 1,537 |   |   |   | 1,467 |   |   |   | 1,890 |   |   |   | 1,862 |   |   |   | 1,742 |   |
| Goodwill impairment                                                                                                     |   |          | —   |   |          |   | — |   |   |   | — |   |   |   | — |   |   |   | 3,851 |   |   |   | — |   |   |   | — |   |   |   | — |   |
| DNOI                                                                                                                    |   | $             | 11,543    |   |          | $      | 10,937 |   |   | $ | 9,960 |   |   | $ | 13,475 |   |   | $ | 14,178 |   |   | $ | 14,904 |   |   | $ | 14,812 |   |   | $ | 23,008 |   |
| Weighted-average common shares outstanding—basic and diluted(c)(d)                                                |   |          | 76,267    |   |          |   | 75,876 |   |   |   | 74,592 |   |   |   | 74,498 |   |   |   | 74,424 |   |   |   | 74,296 |   |   |   | 72,310 |   |   |   | 68,847 |   |
| Number of common shares outstanding at period-end                                                                       |   |          | 76,394    |   |          |   | 75,970 |   |   |   | 75,970 |   |   |   | 76,027 |   |   |   | 76,075 |   |   |   | 76,117 |   |   |   | 75,618 |   |   |   | 65,570 |   |

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| (a) | DNOI is net operating income before investment gains and losses and income tax provision (benefit), as determined in accordance with GAAP adjusted for amortization of employee restricted stock awards and goodwill impairment.  We view DNOI and the related per share measures as useful and appropriate supplements to net operating income, net income, earnings per share and cash flows from operating activities.  These measures serve as an additional measure of our operating performance exclusive of employee restricted stock amortization and goodwill impairment charges, which represents an expense of the company but does not require settlement in cash.  DNOI does include PIK interest and dividend income which are generally not payable in cash on a regular basis but rather at investment maturity or when declared.  DNOI should not be considered as an alternative to net operating income, net income, earnings per share and cash flows from operating activities (each computed in accordance with GAAP).  Instead, DNOI should be reviewed in connection with net operating income, net income, earnings per share and cash flows from operating activities in our consolidated financial statements, to help analyze how our business is performing. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | Based on common shares outstanding at period-end. |
|-----|---------------------------------------------------|

| (c) | Results for the three months ended December 31, 2008 and September 30, 2008, include $18 and $88 of amortization of employee restricted stock awards associated with our corporate restructuring.  These expenses are reported as general and administrative expenses on our Consolidated Statements of Operations. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | In accordance with ASC 260—Earnings Per Share, we adjusted the weighted-average basic and diluted common shares outstanding for the three months ended March 31, 2008 to include participating restricted shares of common stock that received non-forfeitable dividends.  See Note 12—(Loss) Earnings Per Share for additional information.  The implementation of this standard did not change our previously reported earnings per share. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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Table of Contents

|                                                                    |   | 2009 Quarters |    |   | 2008 Quarters |   |
|-------------------------------------------------------------------------|--------|---------------|---------|--------|---------------|--------|
| (in thousands, except per share amounts)                                |   | Fourth        |    |   | Third         |   |   | Second |   |   | First |   |   | Fourth |   |   | Third |   |   | Second |   |   | First |   |
| Portfolio company data (Fair Value)                                     |   |          |    |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Portfolio by type                                                       |   |          |    |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Debt investments                                                        |   |          |    |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Senior secured debt                                                     |   | $             | 379,457 |   |          | $      | 416,302 |   |   | $ | 428,576 |   |   | $ | 456,377 |   |   | $ | 428,817 |   |   | $ | 383,493 |   |   | $ | 441,500 |   |   | $ | 452,445 |   |
| Subordinated debt                                                       |   |          |    |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Secured                                                                 |   |          | 275,398 |   |          |   | 292,144 |   |   |   | 283,471 |   |   |   | 303,490 |   |   |   | 351,425 |   |   |   | 453,336 |   |   |   | 478,107 |   |   |   | 513,467 |   |
| Unsecured                                                               |   |          | 30,618  |   |          |   | 30,476 |   |   |   | 27,961 |   |   |   | 27,823 |   |   |   | 28,081 |   |   |   | 29,967 |   |   |   | 30,613 |   |   |   | 32,722 |   |
| Total debt investments                                                  |   |          | 685,473 |   |          |   | 738,922 |   |   |   | 740,008 |   |   |   | 787,690 |   |   |   | 808,323 |   |   |   | 866,796 |   |   |   | 950,220 |   |   |   | 998,634 |   |
| Equity investments                                                      |   |          |    |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Preferred equity                                                        |   |          | 257,984 |   |          |   | 252,604 |   |   |   | 270,899 |   |   |   | 277,893 |   |   |   | 339,576 |   |   |   | 369,513 |   |   |   | 411,700 |   |   |   | 449,978 |   |
| Common equity/equivalents                                               |   |          | 42,889  |   |          |   | 45,718 |   |   |   | 50,599 |   |   |   | 49,409 |   |   |   | 55,249 |   |   |   | 60,160 |   |   |   | 69,164 |   |   |   | 63,804 |   |
| Total equity investments                                                |   |          | 300,873 |   |          |   | 298,322 |   |   |   | 321,498 |   |   |   | 327,302 |   |   |   | 394,825 |   |   |   | 429,673 |   |   |   | 480,864 |   |   |   | 513,782 |   |
| Total portfolio                                                         |   | $             | 986,346 |   |          | $      | 1,037,244 |   |   | $ | 1,061,506 |   |   | $ | 1,114,992 |   |   | $ | 1,203,148 |   |   | $ | 1,296,469 |   |   | $ | 1,431,084 |   |   | $ | 1,512,416 |   |
| % of Total portfolio                                                    |   |          |    |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Debt investments                                                        |   |          |    |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Senior secured debt                                                     |   |          | 38.5    | %      |          |   | 40.1 | % |   |   | 40.4 | % |   |   | 40.9 | % |   |   | 35.7 | % |   |   | 29.6 | % |   |   | 30.9 | % |   |   | 29.9 | % |
| Subordinated debt                                                       |   |          |    |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Secured                                                                 |   |          | 27.9    |   |          |   | 28.2 |   |   |   | 26.7 |   |   |   | 27.2 |   |   |   | 29.2 |   |   |   | 35.0 |   |   |   | 33.4 |   |   |   | 34.0 |   |
| Unsecured                                                               |   |          | 3.1     |   |          |   | 2.9 |   |   |   | 2.6 |   |   |   | 2.5 |   |   |   | 2.3 |   |   |   | 2.3 |   |   |   | 2.1 |   |   |   | 2.1 |   |
| Total debt investments                                                  |   |          | 69.5    |   |          |   | 71.2 |   |   |   | 69.7 |   |   |   | 70.6 |   |   |   | 67.2 |   |   |   | 66.9 |   |   |   | 66.4 |   |   |   | 66.0 |   |
| Equity investments                                                      |   |          |    |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Preferred equity                                                        |   |          | 26.2    |   |          |   | 24.4 |   |   |   | 25.5 |   |   |   | 24.9 |   |   |   | 28.2 |   |   |   | 28.5 |   |   |   | 28.8 |   |   |   | 29.8 |   |
| Common equity/equivalents                                               |   |          | 4.3     |   |          |   | 4.4 |   |   |   | 4.8 |   |   |   | 4.5 |   |   |   | 4.6 |   |   |   | 4.6 |   |   |   | 4.8 |   |   |   | 4.2 |   |
| Total equity investments                                                |   |          | 30.5    |   |          |   | 28.8 |   |   |   | 30.3 |   |   |   | 29.4 |   |   |   | 32.8 |   |   |   | 33.1 |   |   |   | 33.6 |   |   |   | 34.0 |   |
| Total portfolio                                                         |   |          | 100.0   | %      |          |   | 100.0 | % |   |   | 100.0 | % |   |   | 100.0 | % |   |   | 100.0 | % |   |   | 100.0 | % |   |   | 100.0 | % |   |   | 100.0 | % |
| Yield on average loan portfolio at fair value                           |   |          |    |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Average 90-Day LIBOR                                                    |   |          | 0.3     | %      |          |   | 0.4 | % |   |   | 0.9 | % |   |   | 1.2 | % |   |   | 2.7 | % |   |   | 2.9 | % |   |   | 2.7 | % |   |   | 3.3 | % |
| Spread to avg. LIBOR on average loan portfolio                          |   |          | 12.0    |   |          |   | 11.9 |   |   |   | 12.0 |   |   |   | 11.9 |   |   |   | 10.4 |   |   |   | 9.8 |   |   |   | 9.5 |   |   |   | 9.7 |   |
| Impact of fee accelerations of unearned fees on paid/restructured loans |   |          | 0.1     |   |          |   | 0.1 |   |   |   | — |   |   |   | 0.1 |   |   |   | 0.1 |   |   |   | — |   |   |   | 0.1 |   |   |   | — |   |
| Impact of previously unaccrued loans                                    |   |          | — |   |          |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Impact of non-accrual loans                                             |   |          | (0.5    | )      |          |   | (0.7 | ) |   |   | (1.3 | ) |   |   | (0.9 | ) |   |   | (0.8 | ) |   |   | (0.8 | ) |   |   | (1.4 | ) |   |   | (0.9 | ) |
| Total yield on average loan portfolio                                   |   |          | 11.9    | %      |          |   | 11.7 | % |   |   | 11.6 | % |   |   | 12.3 | % |   |   | 12.4 | % |   |   | 11.9 | % |   |   | 10.9 | % |   |   | 12.1 | % |
| Composition of loan portfolio by interest type (Fair Value)             |   |          |    |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| % of loans with fixed interest rates                                    |   |          | 44.4    | %      |          |   | 41.2 | % |   |   | 39.5 | % |   |   | 39.6 | % |   |   | 41.2 | % |   |   | 41.1 | % |   |   | 40.4 | % |   |   | 37.9 | % |
| % of loans with floating interest rates                                 |   |          | 55.6    | %      |          |   | 58.8 | % |   |   | 60.5 | % |   |   | 60.4 | % |   |   | 58.8 | % |   |   | 58.9 | % |   |   | 59.6 | % |   |   | 62.1 | % |
| Percentage of total debt investments (Fair Value)                       |   |          |    |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans on non-accrual status                                             |   |          | 3.7     | %      |          |   | 7.0 | % |   |   | 6.2 | % |   |   | 4.8 | % |   |   | 4.9 | % |   |   | 4.2 | % |   |   | 6.2 | % |   |   | 7.1 | % |
| Loans greater than 90 days past due                                     |   |          | 0.9     | %      |          |   | 1.4 | % |   |   | 1.0 | % |   |   | 0.1 | % |   |   | 0.1 | % |   |   | 0.2 | % |   |   | 1.1 | % |   |   | 1.2 | % |
| Percentage of total debt investments (Cost)                             |   |          |    |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Loans on non-accrual status                                             |   |          | 10.8    | %      |          |   | 19.6 | % |   |   | 19.59 | % |   |   | 14.53 | % |   |   | 13.0 | % |   |   | 10.9 | % |   |   | 11.7 | % |   |   | 7.5 | % |
| Loans greater than 90 days past due                                     |   |          | 2.9     | %      |          |   | 4.7 | % |   |   | 2.6 | % |   |   | 0.8 | % |   |   | 1.1 | % |   |   | 1.1 | % |   |   | 1.7 | % |   |   | 1.2 | % |
| Weighted average portfolio company operating metrics(a)                 |   |          |    |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Annual revenue(b)(c)                                                    |   | $             | 128,774 |   |          | $      | 126,860 |   |   | $ | 128,704 |   |   | $ | 124,241 |   |   | $ | 121,565 |   |   | $ | 115,069 |   |   | $ | 118,256 |   |   | $ | 120,085 |   |
| Annual EBITDA(b)(c)                                                     |   |          | 20,101  |   |          |   | 19,284 |   |   |   | 19,009 |   |   |   | 17,685 |   |   |   | 17,036 |   |   |   | 16,081 |   |   |   | 16,093 |   |   |   | 14,534 |   |
| Loan to value of non-broadly syndicated portfolio companies             |   |          | 61.8    | %      |          |   | 63.0 | % |   |   | 63.7 | % |   |   | 63.8 | % |   |   | 61.0 | % |   |   | 54.3 | % |   |   | 52.9 | % |   |   | 53.6 | % |
| Trailing twelve month equity EBITDA multiple(b)(d)(e)                   |   |          | 8.0     | x      |          |   | 8.2 | x |   |   | 8.2 | x |   |   | 8.3 | x |   |   | 8.4 | x |   |   | 9.4 | x |   |   | 10.1 | x |   |   | 10.2 | x |
| Forward twelve month equity EBITDA multiple(b)(c)(d)(e)                 |   |          | 7.0     | x      |          |   | 7.5 | x |   |   | 7.1 | x |   |   | 7.0 | x |   |   | 7.2 | x |   |   | 8.7 | x |   |   | 8.0 | x |   |   | 8.0 | x |
| Interest to EBITDA ratio(b)                                             |   |          | 2.5     | x      |          |   | 2.4 | x |   |   | 2.6 | x |   |   | 2.5 | x |   |   | 2.5 | x |   |   | 2.6 | x |   |   | 2.4 | x |   |   | 2.6 | x |
| Debt to EBITDA ratio on the debt portfolio(e)                           |   |          | 5.9     | x      |          |   | 6.3 | x |   |   | 6.2 | x |   |   | 6.0 | x |   |   | 5.7 | x |   |   | 5.3 | x |   |   | 5.7 | x |   |   | 6.0 | x |

----

| (a) | Weighted based on the portfolio company’s fair value as of the respective period end. |
|-----|---------------------------------------------------------------------------------------------|

| (b) | Excludes portfolio companies with limited or no operations. |
|-----|-------------------------------------------------------------|

| (c) | Excludes public equity portfolio companies. |
|-----|---------------------------------------------|

| (d) | Excludes portfolio companies valued on a liquidation basis |
|-----|------------------------------------------------------------|

| (e) | For portfolio companies with a nominal EBITDA amount, the EBITDA multiple is limited to 15x.  In addition, the maximum debt to EBITDA ratio is limited to 15x. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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Table of Contents

|                                                                                                 |   | Years ended       |     |   |     |   |
|------------------------------------------------------------------------------------------------------|--------|-------------------|----------|--------|----------|--------|
|                                                                                                 |   | December 31, |     |   | Variance |   |
| (dollars in thousands)                                                                               |   | 2008              |     |   | 2007     |   |   | $ |   |   | Percentage |   |
| Revenue                                                                                              |   |              |     |   |     |   |   |   |   |   |   |   |   |
| Interest and dividend income                                                                         |   |              |     |   |     |   |   |   |   |   |   |   |   |
| Interest income                                                                                      |   | $                 | 108,855  |   |     | $      | 121,917 |   |   | $ | (13,062 | ) |   |   | (10.7 | )% |
| Dividend income                                                                                      |   |              | 19,973   |   |     |   | 49,390 |   |   |   | (29,417 | ) |   |   | (59.6 | ) |
| Loan fees                                                                                            |   |              | 3,427    |   |     |   | 4,722 |   |   |   | (1,295 | ) |   |   | (27.4 | ) |
| Total interest and dividend income                                                                   |   |              | 132,255  |   |     |   | 176,029 |   |   |   | (43,774 | ) |   |   | (24.9 | ) |
| Advisory fees and other income                                                                       |   |              | 3,110    |   |     |   | 11,090 |   |   |   | (7,980 | ) |   |   | (72.0 | ) |
| Total revenue                                                                                        |   |              | 135,365  |   |     |   | 187,119 |   |   |   | (51,754 | ) |   |   | (27.7 | ) |
| Operating expenses                                                                                   |   |              |     |   |     |   |   |   |   |   |   |   |   |   |   |   |
| Interest expense                                                                                     |   |              | 35,431   |   |     |   | 43,119 |   |   |   | (7,688 | ) |   |   | (17.8 | ) |
| Employee compensation                                                                                |   |              |     |   |     |   |   |   |   |   |   |   |   |   |   |   |
| Salaries and benefits                                                                                |   |              | 16,490   |   |     |   | 21,800 |   |   |   | (5,310 | ) |   |   | (24.4 | ) |
| Amortization of employee restricted stock                                                            |   |              | 6,855    |   |     |   | 9,024 |   |   |   | (2,169 | ) |   |   | (24.0 | ) |
| Total employee compensation                                                                          |   |              | 23,345   |   |     |   | 30,824 |   |   |   | (7,479 | ) |   |   | (24.3 | ) |
| General and administrative expense                                                                   |   |              | 16,648   |   |     |   | 11,258 |   |   |   | 5,390 |   |   |   | 47.9 |   |
| Goodwill impairment                                                                                  |   |              | 3,851    |   |     |   | — |   |   |   | 3,851 |   |   | NM |   |
| Total operating expenses                                                                             |   |              | 79,275   |   |     |   | 85,201 |   |   |   | (5,926 | ) |   |   | (7.0 | ) |
| Net operating income before investment loss, gain on extinguishment of debt and income tax provision |   |              | 56,090   |   |     |   | 101,918 |   |   |   | (45,828 | ) |   |   | (45.0 | ) |
| Net investment loss before gain on extinguishment of debt and income tax provision                   |   |              | (257,601 | )      |     |   | (12,887 | ) |   |   | (244,714 | ) |   | NM |   |
| Gain on extinguishment of debt                                                                       |   |              | 11,055   |   |     |   | — |   |   |   | 11,055 |   |   | NM |   |
| Income tax provision                                                                                 |   |              | 789      |   |     |   | 2,395 |   |   |   | (1,606 | ) |   |   | (67.1 | ) |
| Net (loss) income                                                                                    |   | $                 | (191,245 | )      |     | $      | 86,636 |   |   | $ | (277,881 | ) |   | NM |   |

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Table of Contents

|                                    |   | Years ended December 31, |    |
|-----------------------------------------|--------|-------------------------------|---------|
| (in thousands)                          |   | 2008                          |    |   | 2007 |   |
| Beginning PIK loan balance              |   | $                             | 17,685  |   |   | $ | 11,104 |   |
| PIK interest earned during the period   |   |                          | 14,276  |   |   |   | 17,793 |   |
| Interest receivable converted to PIK    |   |                          | 5,004   |   |   |   | 2,964 |   |
| Principal payments of cash on PIK loans |   |                          | (6,230  | ) |   |   | (13,848 | ) |
| PIK converted to other securities       |   |                          | (4,381  | ) |   |   | (730 | ) |
| PIK loans purchased                     |   |                          | — |   |   |   | 402 |   |
| Ending PIK loan balance                 |   | $                             | 26,354  |   |   | $ | 17,685 |   |

|                                     |   | Years ended December 31, |   |
|------------------------------------------|--------|-------------------------------|--------|
| (in thousands)                           |   | 2008                          |   |   | 2007 |   |
| Beginning accrued dividend balance       |   | $                             | 75,614 |   |   | $ | 33,553 |   |
| Dividend income earned during the period |   |                          | 19,973 |   |   |   | 49,390 |   |
| Payment of dividends                     |   |                          | (3,817 | ) |   |   | (7,329 | ) |
| Ending accrued dividend balance          |   | $                             | 91,770 |   |   | $ | 75,614 |   |

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Table of Contents

|                                                                                                                                          |   | Years ended December 31, |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------|--------|
| (in thousands, except per share data)                                                                                                         |   | 2008                          |   |   | 2007 |   |
| Net operating income before investment loss, gain on extinguishment of debt and income tax provision                                          |   | $                             | 56,090 |   |   | $ | 101,918 |   |
| Amortization of employee restricted stock awards                                                                                              |   |                          | 6,961  | (a) |   |   | 9,024 |   |
| Goodwill amortization                                                                                                                         |   |                          | 3,851  |   |   |   | — |   |
| DNOI                                                                                                                                          |   | $                             | 66,902 | (a) |   | $ | 110,942 |   |
| Weighted-average common shares outstanding—basic and diluted                                                                            |   |                          | 72,254 |   |   |   | 65,606 |   |
| (Loss) earnings per common share—basic and diluted                                                                                      |   | $                             | (2.65  | ) |   | $ | 1.32 |   |
| Net operating income before investment loss, gain on extinguishment of debt and income tax provision per common share—basic and diluted |   | $                             | 0.78   |   |   | $ | 1.55 |   |
| DNOI per common share—basic and diluted                                                                                                 |   | $                             | 0.93   |   |   | $ | 1.69 |   |

----

| (a) | Includes $106 of amortization of employee restricted stock awards associated with our corporate restructuring.  These expenses are reported as general and administrative expenses on our Consolidated Statements of Operations. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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Table of Contents

| (in thousands)                                          |   |                           |   |          |   | Year ended December 31, 2008 |    |
|---------------------------------------------------------|--------|--------------------------------|--------|---------------|--------|-----------------------------------|---------|
|                                                    |   |                           |   |          |   | Realized Gain/(Loss)              |    |   | Unrealized Appreciation/(Depreciation) |   |   | Reversal of Unrealized (Depreciation)/ Appreciation |   |   | Net Gain/(Loss) |   |
| Portfolio Company                                       |   | Industry                       |   | Type          |
| Broadview Networks Holdings, Inc.                       |   | Communications                 |   | Control       |   | $                                 | — |   |   | $ | (58,218 | ) |   | $ | — |   |   | $ | (58,218 | ) |
| Jet Plastica Investors, LLC                             |   | Plastic Products               |   | Control       |   |                              | — |   |   |   | (40,411 | ) |   |   | — |   |   |   | (40,411 | ) |
| Cleartel Communications, Inc.                           |   | Communications                 |   | Control       |   |                              | — |   |   |   | (34,743 | ) |   |   | — |   |   |   | (34,743 | ) |
| Active Brands International, Inc.                       |   | Consumer Products              |   | Non-affiliate |   |                              | — |   |   |   | (13,681 | ) |   |   | — |   |   |   | (13,681 | ) |
| Working Mother Media, Inc.                              |   | Publishing                     |   | Control       |   |                              | (21,022 | ) |   |   | (7,089 | ) |   |   | 15,404 |   |   |   | (12,707 | ) |
| TNR Holdings Corp.                                      |   | Entertainment                  |   | Control       |   |                              | — |   |   |   | (12,261 | ) |   |   | — |   |   |   | (12,261 | ) |
| Superior Industries Investors, LLC                      |   | Sporting Goods                 |   | Control       |   |                              | — |   |   |   | (11,930 | ) |   |   | — |   |   |   | (11,930 | ) |
| National Product Services, Inc.                         |   | Business Services              |   | Control       |   |                              | — |   |   |   | (11,915 | ) |   |   | — |   |   |   | (11,915 | ) |
| GMC Television Broadcasting, LLC                        |   | Broadcasting                   |   | Control       |   |                              | — |   |   |   | (11,638 | ) |   |   | — |   |   |   | (11,638 | ) |
| InTran Media, LLC                                       |   | Other Media                    |   | Control       |   |                              | — |   |   |   | (8,208 | ) |   |   | — |   |   |   | (8,208 | ) |
| CWP/RMK Acquisition Corp.                               |   | Home Furnishings               |   | Non-affiliate |   |                              | — |   |   |   | (7,582 | ) |   |   | — |   |   |   | (7,582 | ) |
| PremierGarage Holdings, LLC                             |   | Home Furnishings               |   | Control       |   |                              | — |   |   |   | (5,553 | ) |   |   | — |   |   |   | (5,553 | ) |
| JetBroadband Holdings, LLC                              |   | Cable                          |   | Control       |   |                              | — |   |   |   | (5,253 | ) |   |   | — |   |   |   | (5,253 | ) |
| Coastal Sunbelt, LLC                                    |   | Food Services                  |   | Control       |   |                              | — |   |   |   | (5,139 | ) |   |   | — |   |   |   | (5,139 | ) |
| Philadelphia Newspapers, LLC                            |   | Newspaper                      |   | Non-affiliate |   |                              | — |   |   |   | (5,070 | ) |   |   | — |   |   |   | (5,070 | ) |
| RadioPharmacy Investors, LLC                            |   | Healthcare                     |   | Control       |   |                              | — |   |   |   | (4,696 | ) |   |   | — |   |   |   | (4,696 | ) |
| Total Sleep Holdings, Inc.                              |   | Healthcare                     |   | Control       |   |                              | — |   |   |   | (3,683 | ) |   |   | — |   |   |   | (3,683 | ) |
| Teleguam Holdings, LLC                                  |   | Communications                 |   | Non-affiliate |   |                              | — |   |   |   | (2,911 | ) |   |   | — |   |   |   | (2,911 | ) |
| GSDM Holdings, LLC                                      |   | Healthcare                     |   | Non-affiliate |   |                              | — |   |   |   | (2,759 | ) |   |   | — |   |   |   | (2,759 | ) |
| Cruz Bay Publishing, Inc.                               |   | Publishing                     |   | Non-affiliate |   |                              | — |   |   |   | (2,510 | ) |   |   | — |   |   |   | (2,510 | ) |
| Golden Knight II CLO, Ltd.                              |   | Diversified Financial Services |   | Non-affiliate |   |                              | — |   |   |   | (2,321 | ) |   |   | — |   |   |   | (2,321 | ) |
| Orbitel Holdings, LLC                                   |   | Cable                          |   | Control       |   |                              | — |   |   |   | (2,184 | ) |   |   | — |   |   |   | (2,184 | ) |
| XFone, Inc.                                             |   | Communications                 |   | Affiliate     |   |                              | — |   |   |   | (2,180 | ) |   |   | — |   |   |   | (2,180 | ) |
| G&L Investment Holdings, LLC                        |   | Insurance                      |   | Non-affiliate |   |                              | — |   |   |   | (1,993 | ) |   |   | — |   |   |   | (1,993 | ) |
| CEI Holdings Inc.                                       |   | Cosmetics                      |   | Non-affiliate |   |                              | — |   |   |   | (1,761 | ) |   |   | — |   |   |   | (1,761 | ) |
| Marietta Intermediate Holding Corporation               |   | Cosmetics                      |   | Non-affiliate |   |                              | — |   |   |   | (1,760 | ) |   |   | — |   |   |   | (1,760 | ) |
| Summit Business Media Intermediate Holding Company, LLC |   | Information Services           |   | Non-affiliate |   |                              | — |   |   |   | (1,734 | ) |   |   | — |   |   |   | (1,734 | ) |
| Legacy Cabinets, Inc.                                   |   | Home Furnishings               |   | Non-affiliate |   |                              | — |   |   |   | (1,561 | ) |   |   | — |   |   |   | (1,561 | ) |
| Advanced Sleep Concepts, Inc.                           |   | Home Furnishings               |   | Affiliate     |   |                              | — |   |   |   | (1,554 | ) |   |   | — |   |   |   | (1,554 | ) |
| Home Interiors & Gifts, Inc.                        |   | Home Furnishings               |   | Non-affiliate |   |                              | — |   |   |   | (1,481 | ) |   |   | — |   |   |   | (1,481 | ) |
| Cyrus Networks, LLC                                     |   | Business Services              |   | Non-affiliate |   |                              | — |   |   |   | (1,440 | ) |   |   | — |   |   |   | (1,440 | ) |
| Wireco Worldgroup Inc.                                  |   | Industrial Equipment           |   | Non-affiliate |   |                              | — |   |   |   | (1,276 | ) |   |   | — |   |   |   | (1,276 | ) |
| Sunshine Media Delaware, LLC                            |   | Publishing                     |   | Affiliate     |   |                              | — |   |   |   | (1,202 | ) |   |   | — |   |   |   | (1,202 | ) |
| Jenzabar, Inc.                                          |   | Technology                     |   | Non-affiliate |   |                              | — |   |   |   | 1,362 |   |   |   | — |   |   |   | 1,362 |   |
| JUPR Holdings, Inc.                                     |   | Information Services           |   | Control       |   |                              | 5,994   |   |   |   | 1,714 |   |   |   | (5,958 | ) |   |   | 1,750 |   |
| Wiesner Publishing Company, LLC                         |   | Publishing                     |   | Non-affiliate |   |                              | 5,344   |   |   |   | 2,169 |   |   |   | (5,503 | ) |   |   | 2,010 |   |
| MCI Holdings LLC                                        |   | Healthcare                     |   | Non-affiliate |   |                              | — |   |   |   | 4,553 |   |   |   | — |   |   |   | 4,553 |   |
| LMS Intellibound Investors, LLC                         |   | Logistics                      |   | Control       |   |                              | — |   |   |   | 6,714 |   |   |   | — |   |   |   | 6,714 |   |
| Avenue Broadband LLC                                    |   | Cable                          |   | Control       |   |                              | — |   |   |   | 7,033 |   |   |   | — |   |   |   | 7,033 |   |
| Stratford Schools Holdings, Inc.                        |   | Education                      |   | Affiliate     |   |                              | — |   |   |   | 9,366 |   |   |   | — |   |   |   | 9,366 |   |
| Other                                                   |   |                           |   |          |   |                              | 301     |   |   |   | (7,362 | ) |   |   | (13 | ) |   |   | (7,074 | ) |
| Total                                                   |   |                           |   |          |   | $                                 | (9,383  | ) |   | $ | (252,148 | ) |   | $ | 3,930 |   |   | $ | (257,601 | ) |

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Table of Contents

| (in thousands)                                  |   |                 |   |          |   | Year ended December 31, 2007 |    |
|-------------------------------------------------|--------|----------------------|--------|---------------|--------|-----------------------------------|---------|
| Portfolio Company                               |   | Industry             |   | Type          |   | Realized Gain/(Loss)              |    |   | Unrealized Appreciation/(Depreciation) |   |   | Reversal of Unrealized (Depreciation)/ Appreciation |   |   | Net Gain/(Loss) |   |
| Cleartel Communications, Inc.                   |   | Communications       |   | Control       |   | $                                 | — |   |   | $ | (63,500 | ) |   | $ | — |   |   | $ | (63,500 | ) |
| TNR Entertainment Corp.                         |   | Entertainment        |   | Control       |   |                              | — |   |   |   | (8,827 | ) |   |   | — |   |   |   | (8,827 | ) |
| RadioPharmacy Investors, LLC                    |   | Healthcare           |   | Control       |   |                              | — |   |   |   | (3,083 | ) |   |   | — |   |   |   | (3,083 | ) |
| Cornerstone Healthcare Group Holding, Inc.      |   | Healthcare           |   | Non-affiliate |   |                              | (1,451  | ) |   |   | (1,216 | ) |   |   | 1,216 |   |   |   | (1,451 | ) |
| Value Page, Inc.                                |   | Communications       |   | Non-affiliate |   |                              | — |   |   |   | (1,010 | ) |   |   | — |   |   |   | (1,010 | ) |
| Superior Industries Investors, LLC              |   | Sporting Goods       |   | Control       |   |                              | — |   |   |   | 15,563 |   |   |   | — |   |   |   | 15,563 |   |
| Jenzabar, Inc.                                  |   | Technology           |   | Non-affiliate |   |                              | — |   |   |   | 8,864 |   |   |   | — |   |   |   | 8,864 |   |
| LMS Intellibound Investors, LLC                 |   | Logistics            |   | Control       |   |                              | — |   |   |   | 8,352 |   |   |   | — |   |   |   | 8,352 |   |
| On Target Media, LLC                            |   | Other Media          |   | Affiliate     |   |                              | 8,544   |   |   |   | 6,980 |   |   |   | (8,593 | ) |   |   | 6,931 |   |
| Coastal Sunbelt, LLC                            |   | Food Services        |   | Control       |   |                              | — |   |   |   | 5,190 |   |   |   | — |   |   |   | 5,190 |   |
| JUPR Holdings, Inc.                             |   | Information Services |   | Control       |   |                              | — |   |   |   | 4,244 |   |   |   | — |   |   |   | 4,244 |   |
| Superior Publishing Corporation                 |   | Newspaper            |   | Control       |   |                              | 4,793   |   |   |   | (140 | ) |   |   | (740 | ) |   |   | 3,913 |   |
| JetBroadband Holdings, LLC                      |   | Cable                |   | Control       |   |                              | — |   |   |   | 3,346 |   |   |   | — |   |   |   | 3,346 |   |
| Stratford Schools Holdings, Inc.                |   | Education            |   | Affiliate     |   |                              | — |   |   |   | 3,297 |   |   |   | — |   |   |   | 3,297 |   |
| Jet Plastica Investors, LLC                     |   | Plastic Products     |   | Control       |   |                              | — |   |   |   | 3,171 |   |   |   | — |   |   |   | 3,171 |   |
| Crystal Media Network, LLC                      |   | Broadcasting         |   | Control       |   |                              | — |   |   |   | 1,674 |   |   |   | — |   |   |   | 1,674 |   |
| Metropolitan Telecommunications Holding Company |   | Communications       |   | Non-affiliate |   |                              | — |   |   |   | 1,543 |   |   |   | — |   |   |   | 1,543 |   |
| dick clark productions, inc.                    |   | Broadcasting         |   | Non-affiliate |   |                              | 5,978   |   |   |   | — |   |   |   | (4,491 | ) |   |   | 1,487 |   |
| Other                                           |   |                 |   |          |   |                              | 3,886   |   |   |   | (2,516 | ) |   |   | (3,961 | ) |   |   | (2,591 | ) |
| Total                                           |   |                 |   |          |   | $                                 | 21,750  |   |   | $ | (18,068 | ) |   | $ | (16,569 | ) |   | $ | (12,887 | ) |

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|   | · | Cash and cash equivalents represents unrestricted cash, including checking accounts, interest bearing deposits collateralized by marketable debt securities and highly liquid investments with original maturities of 90 days or less.  As of December 31, 2009 and 2008, we had $54.2 million and $46.1 million, respectively, in cash and cash equivalents.  By February 26, 2010, this balance rose to $56.8 million.  During 2008 and in January 2009, we invested cash-on-hand in interest-bearing deposit accounts.  However, from February 2009 through December 2009, we maintained our cash in non-interest-bearing accounts, which were fully insured by the U.S. Federal Deposit Insurance Corporation, or FDIC, under the FDIC’s Temporary Liquidity Guarantee Program.  The FDIC’s Temporary Liquidity Guarantee Program was originally scheduled to expire on December 31, 2009, but subsequently was extended through June 30, 2010.  Nonetheless, beginning in January 2010, a number of banks have opted out of this program.  As the banking industry stabilizes in 2010, we expect to deposit a portion of our excess cash in secure interest-bearing accounts. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Cash, securitization accounts include principal and interest payments received on securitized loans, which in certain cases, are held in designated bank accounts until monthly or quarterly disbursements are made from the securitization trusts.  In certain cases, we are required to use a portion of these amounts to pay interest expense, reduce borrowings or pay other amounts in accordance with the related securitization agreements.  In other cases, we are permitted to use these amounts to acquire new loans into the securitization trusts.  Cash in securitization accounts has a negative impact on our earnings since the interest we pay on borrowings typically exceeds the rate of return that we are able to earn on temporary cash investments.  Our objective is to maintain sufficient cash-on-hand and availability under our debt facilities to cover current funding requirements and operational needs.   As of December 31, 2009 and 2008, we had $109.1 million and $37.5 million, respectively, in cash, securitization accounts.  By February 26, 2010, this balance rose to $110.2 million.  During 2010, we expect the balance in our cash, securitization accounts to decrease as we originate new loans. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Cash, restricted includes cash held for regulatory purposes and cash that we have received that is earmarked for transfer into our cash securitization accounts.  The largest component of restricted cash is represented by cash held by Solutions Capital I, L.P., our SBIC, which generally is restricted to the origination of new loans from our SBIC.  As of December 31, 2009 and 2008, we had $21.2 million and $1.0 million respectively, of restricted cash.  By February 26, 2010, this balance had decreased to $9.5 million as a result of the SBIC’s origination of a $12.0 million senior debt investment in February 2010.  During 2010, we expect the balance in our cash, restricted account to decrease as we originate new loans. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | · | Investment Opportunities—Beginning in 2008, we suspended new loan and equity origination activities; however, during the third quarter of 2009, we completed a strategic review and concluded that we would begin to evaluate opportunities for new investments.  We expect to focus on new debt investment opportunities and do not expect, for the foreseeable future, to make significant investments in control companies beyond those that currently are in our investment portfolio. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Monetizations—Since the second half of 2008, we have focused on monetizing certain debt and equity investments in our portfolio to deleverage our balance sheet and build cash reserves.  During the year ended December 31, 2009, we successfully monetized $168.0 million of our portfolio investments (at close to our carrying value). These monetizations include: |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | o | the February 2009 sale of our equity investment in LMS for $40.5 million, or $16.3 million and $4.1 million above the most recently reported cost and fair value, respectively; as well as the $10.2 million prepayment of our subordinated debt investment at par in June 2009; |
|--------|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | o | the February 2009 repayment of our $21.5 million second-lien debt investment in Dayton Parts Holding, LLC at par and $0.9 million above its most previously reported fair value; |
|--------|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | o | the April 2009 monetization of our senior debt and equity investment in TNR for $11.6 million.  Our monetization of TNR represents a distressed sale, which was completed at 23.8% and 42.3% of our most recently reported cost and fair value, respectively, which we exited after three major customers notified TNR that they did not intend to renew their contracts; |
|--------|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | o | the June 2009 repayment of our $18.7 million senior debt investment in Cervalis, LLC at par and $0.4 million above the most recently reported fair value; |
|--------|---|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | o | the August 2009, sale of our equity investment in Coastal Sunbelt Holdings, Inc., for $15.2 million, or 98% of its most recently reported cost and fair value; and |
|--------|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | o | the December 2009, repayment of our senior debt investment in Tegra for $25.5 million, or $0.2 million above the most recently reported cost and fair value and the sale of our equity investment in Tegra for $1.5 million, or $0.5 million above the most recently reported cost and fair value. |
|--------|---|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Renegotiation of Agreements—We successfully amended the agreements for our revolving credit facility, our SunTrust Warehouse and our Private Placement Notes.  Most significantly, these amendments relaxed key covenant requirements under the borrowing facilities.  In exchange for these concessions, we agreed to increase the interest rates paid for borrowings under these facilities and to apply a portion of the proceeds from future monetizations to reduce the outstanding borrowings and the borrowing capacity under these facilities.  These amendments will provide us with continuing debt financing and the repayment terms that we established for these facilities, which are generally tied to future monetizations, provide a contingency-based mechanism for us to repay a portion of these obligations as liquidity becomes available.  On May 4, 2009, we decided to repay our unsecured revolving line of credit prior to the May 29, 2009 maturity of this facility. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | o | SunTrust Warehouse: In February 2009, the lender provided its annual renewal of its liquidity facility that supports our SunTrust Warehouse and further amended and restated this facility to, among other things, provide for a final legal maturity for this facility of August 2011.  In addition, this amendment and restatement reduced the minimum net worth requirement in the SunTrust Warehouse from $654.0 million to $525.0 million, plus 50% of the proceeds from equity issuances after February 26, 2009 and reduced our borrowing commitment under the SunTrust Warehouse from $250.0 million to $190.0 million. |
|--------|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | o | Private Placement Notes: In February 2009, the minimum net worth requirement for the Private Placement Notes was reduced from $654.0 million to $500.0 million.  In addition, cross-default provisions were modified so that defaults under other non-recourse credit facilities would not be an event of default for the Private Placement Notes. |
|--------|---|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | · | Corporate Restructuring—In August 2008, we announced the implementation of a corporate restructuring that resulted in lower incentive compensation for our executives, a 27% reduction in our workforce and the closure of certain facilities.  Subsequent to the August 2008 reduction in force, eleven employees have left MCG, whom we do not expect to replace.  As of February 26, 2010, including our reduction in force and voluntary terminations, we have reduced the workforce from 101 to 64, or 37%, since we began our cost reduction initiatives.  To further control our employee compensation expense, we implemented a salary freeze for virtually all personnel for 2009.  We intend to freeze executive and senior management salaries and to make modest cost of living adjustments to our staff’s base salaries during 2010.  We expect to pursue additional cost-saving measures and we plan to manage our expense base relative to our asset size as the portfolio decreases through monetizations. |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Dividend Suspension—We did not declare dividends during the year ended December 31, 2009.  We incurred certain losses for tax purposes in 2009 that we recognized for book purposes during 2008, which resulted in no statutorily required dividend payments in 2009.  We will make our decisions with respect to the actual level of 2010 dividends on a quarter-by-quarter basis, after taking into account the minimum statutorily required level of distributions, gains and losses recognized for tax purposes, portfolio transactional events, our liquidity, cash earnings and our asset coverage ratio at the time of such decision.  We expect to make the first such determination after we finalized the results for the first quarter of 2010. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Repurchases of Collateralized Loan Obligations—In January 2009, we repurchased $7.5 million of collateralized loan obligations for $2.1 million that had previously been issued by our wholly owned subsidiary, Commercial Loan Trust 2006-1.  As a result of this purchase, we recognized a $5.4 million gain on extinguishment of debt for the quarter ended March 31, 2009.  In total, since December 2008, we have repurchased a total of $22.6 million of collateralized loan obligations for approximately 27% of par. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                  |           |   | December 31, 2009      |    |   | December 31, 2008 |   |
|---------------------------------------|----------------|--------|-----------------------------|---------|--------|------------------------|--------|
| (dollars in thousands)                | Maturity Date  |   | Potential Maximum Borrowing |    |   | Amount Outstanding     |   |   | Potential Maximum Borrowing |   |   | Amount Outstanding |   |
| Private Placement Notes               |           |   |                        |    |   |                   |   |   |   |   |   |   |   |
| Series 2005-A                         | October 2011   |   | $                           | 34,307  |   |                   | $      | 34,307 |   |   | $ | 50,000 |   |   | $ | 50,000 |   |
| Series 2007-A                         | October 2012   |   |                        | 17,154  |   |                   |   | 17,154 |   |   |   | 25,000 |   |   |   | 25,000 |   |
| Commercial Loan Funding Trust         |           |   |                        |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Class A Variable Funding Certificate  | August 2011(a) |   |                        | 170,694 |   |                   |   | 158,907 |   |   |   | 218,750 |   |   |   | 162,219 |   |
| Class B Variable Funding Certificate  | August 2011(a) |   |                        | — |   |                   |   | — |   |   |   | 31,250 |   |   |   | 24,950 |   |
| Commercial Loan Trust 2006-1          |           |   |                        |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Series 2006-1 Class A-1 Notes         | April 2018     |   |                        | 106,250 |   |                   |   | 106,250 |   |   |   | 106,250 |   |   |   | 106,250 |   |
| Series 2006-1 Class A-2 Notes         | April 2018     |   |                        | 50,000  |   |                   |   | — |   |   |   | 50,000 |   |   |   | — |   |
| Series 2006-1 Class A-3 Notes         | April 2018     |   |                        | 85,000  |   |                   |   | 85,000 |   |   |   | 85,000 |   |   |   | 85,000 |   |
| Series 2006-1 Class B Notes           | April 2018     |   |                        | 58,750  |   |                   |   | 58,750 |   |   |   | 58,750 |   |   |   | 58,750 |   |
| Series 2006-1 Class C Notes(b)        | April 2018     |   |                        | 45,000  |   |                   |   | 40,000 |   |   |   | 45,000 |   |   |   | 40,000 |   |
| Series 2006-1 Class D Notes(c)        | April 2018     |   |                        | 47,500  |   |                   |   | 29,880 |   |   |   | 47,500 |   |   |   | 37,380 |   |
| Unsecured Revolving Line of Credit(d) | May 2009       |   |                        | — |   |                   |   | — |   |   |   | 70,000 |   |   |   | 44,500 |   |
| SBIC (Maximum borrowing potential)(e) | (f)            |   |                        | 130,000 |   |                   |   | 27,600 |   |   |   | 130,000 |   |   |   | 2,600 |   |
| Total borrowings                      |           |   | $                           | 744,655 |   |                   | $      | 557,848 |   |   | $ | 917,500 |   |   | $ | 636,649 |   |

| (a) | Renewable each February at the lender’s discretion.  The lender provided this renewal in February 2010.  In conjunction with this renewal, the legal final maturity date became August 2012.  In February 2009 the Class B advances were retired. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | Amount outstanding excludes $5.0 million of notes that we repurchased in December 2008 for $1.6 million.  The notes that MCG, the parent company, purchased are eliminated from this schedule as part of the consolidation process. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | Amount outstanding excludes $10.1 million of notes that we repurchased in December 2008 for $2.4 million and $7.5 million of notes that we repurchased in January 2009 for $2.1 million.  The notes that MCG, the parent company, purchased are eliminated from this schedule as part of the consolidation process. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | On May 4, 2009, we repaid the balance of this facility. |
|-----|---------------------------------------------------------|

| (e) | As of December 31, 2009, we had the potential to borrow up to $130.0 million of SBA-guaranteed debentures under the SBIC program. The SBA has approved and committed up to $130.0 million in borrowings to the SBIC.  To realize the full $130.0 million borrowing potential approved and committed by the SBIC under this program, we must fund a total of $65.0 million to the SBIC, of which we have funded $18.6 million as of December 31, 2009.  Based on our funded capital, Solutions Capital I, L.P., subject to the SBA’s approval, may borrow up to an additional $28.3 million to originate investments as of December 31, 2009.  To access the entire $130.0 million that has been approved and committed by the SBA, we would have to fund an additional $46.4 million.  In February 2009, the American Recovery and Reinvestment Act of 2009 was passed into law which, among other things, included a provision that increased the maximum amount of outstanding leverage available to single-license SBIC companies up to $150.0 million. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (f) | Currently, we may originate new borrowings through September 2012 at which time we can apply for a new commitment.  We must repay borrowings under the SBIC program within ten years after the borrowing date, which will occur between September 2018 and September 2022. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| (dollars in thousands)                                                          |   | For the year ended     |    |
|---------------------------------------------------------------------------------|--------|------------------------|---------|
|                                                                            |   | December 31, 2009 |    |   | December 31, 2008 |   |
| Weighted-average borrowings                                                     |   | $                      | 592,625 |   |   | $ | 687,216 |   |
| Average LIBOR                                                                   |   |                   | 0.69    | % |   |   | 2.92 | % |
| Average spread to LIBOR, excluding amortization of deferred debt issuance costs |   |                   | 2.54    |   |   |   | 1.83 |   |
| Impact of amortization of deferred debt issuance costs                          |   |                   | 0.67    |   |   |   | 0.34 |   |
| Total cost of funds                                                             |   |                   | 3.90    | % |   |   | 5.09 | % |

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| (in thousands)                              |   | Private Placement Note Series 2005-A |   |   | Private Placement Note Series 2007-A                  |   |
|---------------------------------------------|--------|--------------------------------------|--------|--------|-------------------------------------------------------|--------|
| Quarter Ended                               |   | Monetization Payment                 |   |   | Maximum Borrowing Capacity After Monetization Payment |   |   | Monetization Payment |   |   | Maximum Borrowing Capacity After Monetization Payment |   |
| March 31, 2009                         |   | $                                    | 5,314  |   |                                                  | $      | 44,686 |   |   |   | 2,658 |   |   | $ | 22,342 |   |
| June 30, 2009                          |   |                                 | 3,128  |   |                                                  |   | 41,558 |   |   |   | 1,564 |   |   |   | 20,778 |   |
| September 30, 2009                     |   |                                 | 3,917  |   |                                                  |   | 37,641 |   |   |   | 1,958 |   |   |   | 18,820 |   |
| December 31, 2009                      |   |                                 | 3,334  |   |                                                  |   | 34,307 |   |   |   | 1,666 |   |   |   | 17,154 |   |
| January 1—February 26, 2010 |   |                                 | 1,928  |   |                                                  |   | 32,379 |   |   |   | 965 |   |   |   | 16,189 |   |

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|                          |   | December 31, 2009 |    | December 31, 2008 |
|-------------------------------|--------|------------------------|---------|------------------------|
| (dollars in thousands)        |   | Amount                 |    |                   | % |   | Amount |   |   | % |
| Securitized assets            |   |                   |    |                   |   |   |   |   |   |   |   |   |
| Senior secured debt           |   | $                      | 140,483 |                   |   | 53.0 | % |   | $ | 164,188 |   |   | 61.9 | % |
| Subordinated secured debt     |   |                   | 102,170 |                   |   | 38.6 |   |   |   | 91,347 |   |   | 34.4 |   |
| Total securitized assets      |   |                   | 242,653 |                   |   | 91.6 |   |   |   | 255,535 |   |   | 96.3 |   |
| Cash, securitization accounts |   |                   | 22,129  |                   |   | 8.4 |   |   |   | 9,806 |   |   | 3.7 |   |
| Total collateral              |   | $                      | 264,782 |                   |   | 100.0 | % |   | $ | 265,341 |   |   | 100.0 | % |

| (in thousands)                    |   | Monetization Payment |    |   | Non cash reductions |   |    | Maximum Borrowing Capacity After Monetization Payment |   |
|-----------------------------------|--------|----------------------|---------|--------|---------------------|--------|---------|-------------------------------------------------------|--------|
| Quarter ended                     |   |                 |    |   |                |   |    |                                                  |   |
| March 31, 2009                    |   | $                    | 1,491   |   |                | $      | — |                                                  |   | $ | 188,509 |   |
| June 30, 2009                     |   |                 | 2,894   |   |                |   | — |                                                  |   |   | 185,615 |   |
| September 30, 2009                |   |                 | 9,967   |   |                |   | — |                                                  |   |   | 175,648 |   |
| December 31, 2009                 |   |                 | 4,954   |   |                |   | — |                                                  |   |   | 170,694 |   |
| January 1—February 26, 2010 |   |                 | 13,774  |   |                |   | — |                                                  |   |   | 156,950 |   |
| Reduction due to amendment        |   |                 | — |   |                |   | 6,950   |                                                  |   |   | 150,000 |   |

|                          |   | December 31, 2009 |    | December 31, 2008 |
|-------------------------------|--------|------------------------|---------|------------------------|
| (dollars in thousands)        |   | Amount                 |    |                   | % |   | Amount |   |   | % |
| Securitized assets            |   |                   |    |                   |   |   |   |   |   |   |   |   |
| Senior secured debt           |   | $                      | 196,036 |                   |   | 47.2 | % |   | $ | 224,661 |   |   | 53.0 | % |
| Subordinated secured debt     |   |                   | 132,169 |                   |   | 31.8 |   |   |   | 171,914 |   |   | 40.5 |   |
| Total securitized assets      |   |                   | 328,205 |                   |   | 79.0 |   |   |   | 396,575 |   |   | 93.5 |   |
| Cash, securitization accounts |   |                   | 87,012  |                   |   | 21.0 |   |   |   | 27,687 |   |   | 6.5 |   |
| Total collateral              |   | $                      | 415,217 |                   |   | 100.0 | % |   | $ | 424,262 |   |   | 100.0 | % |

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|                              |   |   | Amount Outstanding |   |   |              |   |    |   |
|-----------------------------------|--------|--------|--------------------|--------|--------|-------------------|--------|---------|--------|
| (dollars in thousands)            |   |   | December 31, 2009  |   |   | December 31, 2008 |   |    | Rate   |   | Treasury Rate at Pooling Date |   | Spread in basis points |
| Tranche                           |   |   |               |   |   |              |   |    |   |   |   |   |   |   |   |   |   |
|      2008-10B |   |   | $                  | 2,600  |   |              | $      | 2,600   |   |   |   | 6.44 | % | Fixed |   | 3.80 | % |   | 264 |   |
|      2009-10A |   |   |               | 12,000 |   |              |   | — |   |   |   | 5.34 | % | Fixed |   | 2.81 | % |   | 253 |   |
|      2009-10B |   |   |               | 13,000 |   |              |   | — |   |   |   | 4.95 | % | Fixed |   | 3.44 | % |   | 151 |   |
| Total                             |   |   | $                  | 27,600 |   |              | $      | 2,600   |   |   |   | 5.19 | % |   |   | 3.16 | % |   | 203 |   |

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| (in thousands)                                  |   | As of December 31, 2009 |   |
|-------------------------------------------------|--------|------------------------------|--------|
| Unused commitments to portfolio companies       |   | Non-Affiliate Investments    |   |   | Affiliate Investments |   |   | Control Investments |   |   | Total |   |
| Revolving credit facilities                     |   | $                            | 22,409 |   |   | $ | 11,000 |   |   | $ | 1,700 |   |   | $ | 35,109 |   |
| Other                                           |   |                         | 77     |   |   |   | — |   |   |   | 1,360 |   |   |   | 1,437 |   |
| Total unused commitments to portfolio companies |   | $                            | 22,486 |   |   | $ | 11,000 |   |   | $ | 3,060 |   |   | $ | 36,546 |   |

| (in thousands)                            |   | Payments Due by Period |    |
|-------------------------------------------|--------|------------------------|---------|
| Contractual Obligations(a)                |   | Total                  |    |   | Less than 1 year |   |   | 1-3 years |   |   | 4-5 years |   |   | After 5 years |   |
| Borrowings                                |   |                   |    |   |   |   |   |   |   |   |   |   |   |   |   |
| Term securitizations                      |   | $                      | 319,880 |   |   | $ | — |   |   | $ | — |   |   | $ | — |   |   | $ | 319,880 |   |
| Commercial loan funding trust facility(b) |   |                   | 158,907 |   |   |   | 13,327 |   |   |   | 145,580 |   |   |   | — |   |   |   | — |   |
| Unsecured notes                           |   |                   | 51,461  |   |   |   | — |   |   |   | 34,307 |   |   |   | 17,154 |   |   |   | — |   |
| SBIC                                      |   |                   | 27,600  |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | 27,600 |   |
| Total borrowings                          |   |                   | 557,848 |   |   |   | 13,327 |   |   |   | 179,887 |   |   |   | 17,154 |   |   |   | 347,480 |   |
| Operating Leases                          |   |                   | 7,075   |   |   |   | 2,366 |   |   |   | 4,317 |   |   |   | 392 |   |   |   | — |   |
| Total contractual obligations             |   | $                      | 564,923 |   |   | $ | 15,693 |   |   | $ | 184,204 |   |   | $ | 17,546 |   |   | $ | 347,480 |   |

| (a) | Excludes the unused commitments to extend credit to our customers of $36.5 million as discussed above. |
|-----|--------------------------------------------------------------------------------------------------------|

| (b) | Borrowings under the MCG Commercial Loan Funding Trust Facility are listed based on the contractual maturity due to the revolving nature of the facility. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

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| (in thousands)             |   | December 31, 2009 |    |   | December 31, 2008 |   |
|----------------------------|--------|-------------------|---------|--------|------------------------|--------|
| Unused loan commitments(a) |   | $                 | 36,546  |   |                   | $      | 43,393 |   |
| Guarantees                 |   |              | — |   |                   |   | 5,833 |   |
| Standby letters of credit  |   |              | — |   |                   |   | 97 |   |

| _______________ |
|-----------------|
| (a)             | Estimated fair value of unused loan commitments as of both December 31, 2009 and December 31, 2008 was $0.2 million, based on the fees that we currently charge to enter into similar arrangements, taking into account the creditworthiness of the counterparties. |

| Date Declared     | Record Date | Payment Date      | Amount |
|-------------------|-------------|-------------------|--------|
| May 6, 2008       |        | June 30, 2008     |   | July 30, 2008 |   | $0.27 |   |
| February 22, 2008 |        | March 12, 2008    |   | April 29, 2008 |   | 0.44 |   |
| October 25, 2007  |        | November 21, 2007 |   | January 30, 2008 |   | 0.44 |   |
| July 26, 2007     |        | August 23, 2007   |   | October 30, 2007 |   | 0.44 |   |
| April 17, 2007    |        | May 24, 2007      |   | July 30, 2007 |   | 0.44 |   |
| February 15, 2007 |        | March 15, 2007    |   | April 27, 2007 |   | 0.44 |   |

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|                                                                            |   | Years ended December 31, |    |
|---------------------------------------------------------------------------------|--------|-------------------------------|---------|
| (in thousands)                                                                  |   | 2009                          |    |   | 2008 |   |
| Net loss                                                                        |   | $                             | (51,059 | ) |   | $ | (191,245 | ) |
| Difference between book and tax losses on investments(a)                        |   |                          | 48,078  |   |   |   | (73,272 | ) |
| Net change in unrealized depreciation on investments not taxable until realized |   |                          | (97,631 | ) |   |   | 248,218 |   |
| Capital losses in excess of capital gains                                       |   |                          | 54,245  |   |   |   | — |   |
| Timing difference related to deductibility of long-term incentive compensation  |   |                          | 6,091   |   |   |   | 6,642 |   |
| Taxable interest income on non-accrual loans(b)                                 |   |                          | 14,949  |   |   |   | 2,051 |   |
| Dividend income accrued for GAAP purposes that is not yet taxable               |   |                          | (6,149  | ) |   |   | (19,972 | ) |
| Distributions from taxable subsidiaries                                         |   |                          | 144     |   |   |   | 483 |   |
| Federal tax (benefit) provision                                                 |   |                          | (81     | ) |   |   | 789 |   |
| Other, net                                                                      |   |                          | 323     |   |   |   | 4,181 |   |
| Taxable income (loss) before deductions for distributions                       |   | $                             | (31,090 | ) |   | $ | (22,125 | ) |

| (a) | Results for the year ended December 31, 2008, primarily reflect the write-off, for tax purposes, of the common stock of Cleartel. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------|

| (b) | Results for the years ended December 31, 2008 and 2009 reflect the reversal of interest that we previously recognized on non-accrual loans of a portfolio investment that we liquidated.  We applied the proceeds from the liquidation to the portfolio company’s outstanding principal balance on the debt obligation to us. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Interest Income—We accrue interest income if we expect that ultimately we will be able to collect it.  Generally, when a loan becomes more than 90 days past due, or if we otherwise believe the customer is unable to service its debt and other obligations, we will place the loan on non-accrual status and will cease recognizing interest income on that loan until all principal and interest is current through payment or due to a restructuring such that the interest income is deemed to be collectible.  However, we remain contractually entitled to this interest.  We may make exceptions to this policy if the loan has sufficient collateral value and is in the process of collection. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Dividend Income—We accrue dividend income on equity investments with stated income, if we expect to collect the dividends.  We record dividend income on common equity investments when the dividend has been declared and is required to be paid. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Loan Origination Fees—We capitalize loan origination fees, then amortize these fees into interest income over the term of the loan using the effective interest rate method.  In certain loan arrangements, we receive warrants or other equity interests from the borrower as additional origination fees.  Typically, borrowers granting these interests are not traded publicly.  We record the financial instruments received at fair value as determined in good faith by our board of directors.  In certain cases, when we record a warrant or other equity instrument that results in a loan discount, we accrete the discount into income over the term of the loan. |
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|   | · | Advisory Fees and Other Income—We charge our portfolio companies fees for services that we provide, including advisory and management services, equity structuring, prepayments, research, bank interest and other fees.  These fees are based on market rates, which are documented in an agreement between MCG and the respective portfolio companies.  We recognize advisory and management services fees when earned.  We also recognize equity structuring fees as earned, which generally occurs when the investment transaction closes.  Finally, we recognize prepayment fees upon receipt. |
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| ASC 820              |                                                                                                                                                                                                                                                                                                                                                                                                                  |
|----------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Fair Value Hierarchy | Inputs to Fair Value Methodology                                                                                                                                                                                                                                                                                                                                                                                      |
| Level 1              | Quoted prices in active markets for identical assets or liabilities                                                                                                                                                                                                                                                                                                                                                   |
|                 |                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Level 2              | Quoted prices for similar assets or liabilities; quoted markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the financial instrument; inputs other than quoted prices that are observable for the asset or liability; or inputs that are derived principally from, or corroborated by, observable market information |
|                 |                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Level 3              | Pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption is unobservable or when the estimation of fair value requires significant management judgment                                                                                                                                                                                                  |

| · | Majority-Owned Control Investments—Majority-owned control investments comprise 41.2% of our investment portfolio.  Market quotations are not readily available for these investments; therefore, we use a combination of market and income approaches to determine their fair value.  Typically, private companies are bought and sold based on multiples of EBITDA, cash flows, net income, revenues or, in limited cases, book value.  Generally, we apply multiples that we observe for other comparable companies to relevant financial data for the portfolio company.  Also, in a limited number of cases, we use income approaches to determine the fair value of these securities, based on our projections of the discounted future free cash flows that the portfolio company will likely generate, as well as industry derived capital costs.  Our valuation approaches for majority-owned investments estimate the value were we to sell or exit the investment.  These valuation approaches assume the highest and best use of the investment by market participants and consider the value of our ability to control the portfolio company’s capital structure and the timing of a potential exit. |
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| · | Non-Majority-Owned Control Investments—Non-majority owned investments comprise 0.4% of our investment portfolio.  For our non-majority owned equity investments, we use the same market and income valuation approaches used to value our majority-owned control investments.  For non-majority-owned control debt investments, we estimate fair value using the market yield approach based on the expected future cash flows discounted at the loans’ effective interest rates, based on our estimate of current market rates.  We may adjust discounted cash flow calculations to reflect other market conditions or the perceived credit risk of the borrower. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | Non-Control Investments—Non-control investments comprise 58.4% of our investment portfolio.  Quoted prices are not available for 99.1% of our non-control investments, which represent 57.9% of our investment portfolio.  For our non-control equity investments, we use the same market and income approaches used to value our control investments.  For non-control debt investments, we estimate fair value using a market yield approach based on the expected future cash flows discounted at the loans’ effective interest rates, based on our estimate of current market rates.  We may adjust discounted cash flow calculations to reflect other market conditions or the perceived credit risk of the borrower. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | Thinly Traded and Over-the-Counter Securities—Generally, we value securities that are traded in the over-the-counter market or on a stock exchange at the average of the prevailing bid and ask prices on the date of the relevant period end.  However, we may apply a discount to the market value of restricted or thinly traded public securities to reflect the impact that these restrictions have on the value of these securities.  We review factors including the trading volume, total securities outstanding and our percentage ownership of securities to determine whether the trading levels are active (Level 1) or inactive (Level 2).  As of December 31, 2009, these securities represented 0.5% of our investment portfolio. |
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|                                                       |   | As of December 31, 2009 |    |
|------------------------------------------------------------|--------|------------------------------|---------|
|                                                       |   | Investments at Fair Value    |    |   | Percent of |   |
| (dollars in thousands)                                     |   | Debt                         |    |   | Equity |   |   | Total |   |   | Debt Portfolio |   |   | Equity Portfolio |   |   | Total Portfolio |   |
| Valuations/reviews prepared by independent firms(a)        |   |                         |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Fourth quarter 2009                                        |   | $                            | 160,185 |   |   | $ | 171,419 |   |   | $ | 331,604 |   |   |   | 23.4 | % |   |   | 57.0 | % |   |   | 33.6 | % |
| Third quarter 2009                                         |   |                         | 97,965  |   |   |   | 10,483 |   |   |   | 108,448 |   |   |   | 14.3 |   |   |   | 3.5 |   |   |   | 11.0 |   |
| Second quarter 2009                                        |   |                         | 135,567 |   |   |   | 13,307 |   |   |   | 148,874 |   |   |   | 19.8 |   |   |   | 4.4 |   |   |   | 15.1 |   |
| First quarter 2009                                         |   |                         | 235,551 |   |   |   | 96,758 |   |   |   | 332,309 |   |   |   | 34.3 |   |   |   | 32.1 |   |   |   | 33.7 |   |
| Total valuations/reviews prepared by independent firms     |   |                         | 629,268 |   |   |   | 291,967 |   |   |   | 921,235 |   |   |   | 91.8 |   |   |   | 97.0 |   |   |   | 93.4 |   |
| Fair value derived from sales transaction                  |   |                         |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Third quarter 2009                                         |   |                         | 51,768  |   |   |   | — |   |   |   | 51,768 |   |   |   | 7.6 |   |   |   | — |   |   |   | 5.2 |   |
| Total derived from sales transaction                       |   |                         | 51,768  |   |   |   | — |   |   |   | 51,768 |   |   |   | 7.6 |   |   |   | — |   |   |   | 5.2 |   |
| Not evaluated during the 12 months ended December 31, 2009 |   |                         | 4,437   |   |   |   | 8,906 |   |   |   | 13,343 |   |   |   | 0.6 |   |   |   | 3.0 |   |   |   | 1.4 |   |
| Total investment portfolio                                 |   | $                            | 685,473 |   |   | $ | 300,873 |   |   | $ | 986,346 |   |   |   | 100.0 | % |   |   | 100.0 | % |   |   | 100.0 | % |

|   | (a) | Valuations/reviews prepared  by independent firms more than one time during the twelve months ended December 31, 2009 have that investment’s fair value reflected in the most recent quarter for which a valuation/review was prepared. |
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|   | · | In February 2008, FASB issued FASB Staff Position No. FAS 157-2—Effective Date of FASB No. 157, which deferred the date for which ASC 820 was required to be adopted for nonfinancial assets and nonfinancial liabilities to fiscal years beginning after November 15, 2008, with early adoption permitted in certain cases.  Our adoption of this standard, as of January 1, 2009, did not affect our financial position or results of operations. |
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|   | · | In October 2008, FASB issued FASB Staff Position No. FAS 157-3—Determining the Fair Value of a Financial Asset When the Market for That Asset is Not Active, which provided an illustrative example of how to determine the fair value of a financial asset in an inactive market.  This standard did not change the fair value measurement principles previously set forth by FASB.  We adopted this modification in January 2009.  Our practice for determining the fair value of our investment portfolio has been, and continues to be, consistent with the guidance provided in the example included in the October 2008 guidance.  Therefore, our adoption of this standard did not affect our practices for determining the fair value of our investment portfolio and did not have a material effect on our financial position or results of operations. |
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|   | · | In April 2009, FASB issued FASB Staff Position No. FAS 157-4—Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Indentifying Transactions That Are Not Orderly, which established standards for determining whether normal market activity exists for Level 2 assets and liabilities.  In addition, the standard expands disclosure requirements for fair value reporting and requires a categorization of investments consistent with that required for ASC 320—Investments—Debt and Equity Securities.  We adopted this standard for the period ended June 30, 2009.  Since our Level 2 investments comprise less than 0.5% of our investment portfolio, our adoption of this standard, did not have a material effect on our financial position or results of operations. |
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|                      |   | December 31, 2009 |    |   | December 31, 2008 |   |
|---------------------------|--------|------------------------|---------|--------|------------------------|--------|
| (in thousands)            |   | Commercial Loans       |    |   | Borrowings             |   |   | Interest Bearing Cash and Commercial Loans |   |   | Borrowings |   |
| Repurchase agreement rate |   | $                      | — |   |                   | $      | — |   |   | $ | 79,916 |   |   | $ | — |   |
| Money market rate         |   |                   | — |   |                   |   | — |   |   |   | 156 |   |   |   | — |   |
| Prime rate                |   |                   | 75,126  |   |                   |   | — |   |   |   | 63,346 |   |   |   | — |   |
| LIBOR                     |   |                   |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| 30-day                    |   |                   | 19,876  |   |                   |   | — |   |   |   | 16,825 |   |   |   | — |   |
| 60-day                    |   |                   | 12,441  |   |                   |   | — |   |   |   | — |   |   |   | — |   |
| 90-day                    |   |                   | 306,563 |   |                   |   | 319,880 |   |   |   | 459,012 |   |   |   | 371,880 |   |
| 180-day                   |   |                   | 3,683   |   |                   |   | — |   |   |   | 7,923 |   |   |   | — |   |
| Commercial paper          |   |                   | — |   |                   |   | 158,907 |   |   |   | — |   |   |   | 187,169 |   |
| Fixed rate                |   |                   | 350,504 |   |                   |   | 79,061 |   |   |   | 372,226 |   |   |   | 77,600 |   |
| Total                     |   | $                      | 768,193 |   |                   | $      | 557,848 |   |   | $ | 999,404 |   |   | $ | 636,649 |   |

| (dollars in thousands) |   |   |            |   |   |             |   |   |                                    |   |   |     |   |
|------------------------|--------|--------|-----------------|--------|--------|------------------|--------|--------|-----------------------------------------|--------|--------|----------|--------|
| Basis Point Change(a)  |   |   | Interest Income |   |   | Interest Expense |   |   | Unrealized (Depreciation)/ Appreciation |   |   | Net Loss |   |
| 100                    |   |   |            | 1,361  |   |             |   | 4,788  |                                    |   |   | (486     | )      |   |   | (3,913 | ) |
| 200                    |   |   |            | 2,947  |   |             |   | 9,576  |                                    |   |   | 79       |   |   |   | (6,550 | ) |
| 300                    |   |   |            | 5,760  |   |             |   | 14,364 |                                    |   |   | 639      |   |   |   | (7,965 | ) |

| (a) | As of December 31, 2009, quarterly average LIBOR was 0.27%; thus, a 100 basis point decrease could not occur. |
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It

|                                                                                                  | Page |
|-------------------------------------------------------------------------------------------------------|------|
| Reports of Independent Registered Public Accounting Firm                                              | 77   |
| Consolidated Balance Sheets as of December 31, 2009 and 2008                                          | 79   |
| Consolidated Statements of Operations for the years ended December 31, 2009, 2008 and 2007            | 80   |
| Consolidated Statements of Changes in Net Assets for the years ended December 31, 2009, 2008 and 2007 | 81   |
| Consolidated Statements of Cash Flows for the years ended December 31, 2009, 2008 and 2007            | 82   |
| Consolidated Schedule of Investments as of December 31, 2009                                          | 83   |
| Consolidated Schedule of Investments as of December 31, 2008                                          | 88   |
| Notes to Consolidated Financial Statements                                                            | 93   |

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|   | /s/ Ernst & Young LLP |
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|   | /s/ Ernst & Young LLP |
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|                                                                                                                                                                                              |   | December 31, |      |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------|-----------|
| (in thousands, except per share amounts)                                                                                                                                                          |   | 2009              |      |   | 2008 |   |
| Assets                                                                                                                                                                                            |   |              |      |   |   |   |
| Cash and cash equivalents                                                                                                                                                                         |   | $                 | 54,187    |   |   | $ | 46,149 |   |
| Cash, securitization accounts                                                                                                                                                                     |   |              | 109,141   |   |   |   | 37,493 |   |
| Cash, restricted                                                                                                                                                                                  |   |              | 21,232    |   |   |   | 979 |   |
| Investments at fair value                                                                                                                                                                         |   |              |      |   |   |   |   |   |
| Non-affiliate investments (cost of $560,347 and $605,906, respectively)                                                                                                                           |   |              | 531,974   |   |   |   | 584,336 |   |
| Affiliate investments (cost of $38,845 and $45,141, respectively)                                                                                                                                 |   |              | 44,388    |   |   |   | 56,126 |   |
| Control investments (cost of $555,732 and $819,076, respectively)                                                                                                                            |   |              | 409,984   |   |   |   | 562,686 |   |
| Total investments (cost of $1,154,924 and $1,470,123, respectively)                                                                                                                               |   |              | 986,346   |   |   |   | 1,203,148 |   |
| Interest receivable                                                                                                                                                                               |   |              | 6,025     |   |   |   | 8,472 |   |
| Other assets                                                                                                                                                                                      |   |              | 14,218    |   |   |   | 16,193 |   |
| Total assets                                                                                                                                                                                      |   | $                 | 1,191,149 |   |   | $ | 1,312,434 |   |
| Liabilities                                                                                                                                                                                       |   |              |      |   |   |   |   |   |
| Borrowings (maturing within one year of $13,327 and $44,500, respectively)                                                                                                                        |   | $                 | 557,848   |   |   | $ | 636,649 |   |
| Interest payable                                                                                                                                                                                  |   |              | 2,736     |   |   |   | 5,367 |   |
| Other liabilities                                                                                                                                                                                 |   |              | 14,882    |   |   |   | 11,507 |   |
| Total liabilities                                                                                                                                                                                 |   |              | 575,466   |   |   |   | 653,523 |   |
| Stockholders’ equity                                                                                                                                                                        |   |              |      |   |   |   |   |   |
| Preferred stock, par value $0.01, authorized 1 share, none issued and outstanding                                                                                                                 |   |              | —   |   |   |   | — |   |
| Common stock, par value $0.01, authorized 200,000 shares on December 31, 2009 and 2008, 76,394 issued and outstanding on December 31, 2009 and 76,075 issued and outstanding on December 31, 2008 |   |              | 764       |   |   |   | 761 |   |
| Paid-in capital                                                                                                                                                                                   |   |              | 1,005,085 |   |   |   | 997,318 |   |
| Undistributed (distributions in excess of) earnings                                                                                                                                               |   |              |      |   |   |   |   |   |
| Paid-in capital                                                                                                                                                                                   |   |              | (162,783  | ) |   |   | (162,783 | ) |
| Other                                                                                                                                                                                             |   |              | (57,066   | ) |   |   | 91,624 |   |
| Net unrealized depreciation on investments                                                                                                                                                        |   |              | (170,317  | ) |   |   | (267,948 | ) |
| Stockholder loans                                                                                                                                                                                 |   |              | —   |   |   |   | (61 | ) |
| Total stockholders’ equity                                                                                                                                                                  |   |              | 615,683   |   |   |   | 658,911 |   |
| Total liabilities and stockholders’ equity                                                                                                                                                  |   | $                 | 1,191,149 |   |   | $ | 1,312,434 |   |
| Net asset value per common share at end of period                                                                                                                                                 |   | $                 | 8.06      |   |   | $ | 8.66 |   |

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|                                                                                                               |   | Years ended December 31, |     |
|--------------------------------------------------------------------------------------------------------------------|--------|-------------------------------|----------|
| (in thousands, except per share amounts)                                                                           |   | 2009                          |     |   | 2008 |   |   | 2007 |   |
| Revenue                                                                                                            |   |                          |     |   |   |   |   |   |   |
| Interest and dividend income                                                                                       |   |                          |     |   |   |   |   |   |   |
| Non-affiliate investments (less than 5% owned)                                                                     |   | $                             | 64,209   |   |   | $ | 72,725 |   |   | $ | 82,229 |   |
| Affiliate investments (5% to 25% owned)                                                                            |   |                          | 4,470    |   |   |   | 6,777 |   |   |   | 13,453 |   |
| Control investments (more than 25% owned)                                                                          |   |                          | 28,627   |   |   |   | 52,753 |   |   |   | 80,347 |   |
| Total interest and dividend income                                                                                 |   |                          | 97,306   |   |   |   | 132,255 |   |   |   | 176,029 |   |
| Advisory fees and other income                                                                                     |   |                          |     |   |   |   |   |   |   |   |   |   |
| Non-affiliate investments (less than 5% owned)                                                                     |   |                          | 1,333    |   |   |   | 1,507 |   |   |   | 4,819 |   |
| Affiliate investments (5% to 25% owned)                                                                            |   |                          | —  |   |   |   | 99 |   |   |   | 107 |   |
| Control investments (more than 25% owned)                                                                          |   |                          | 1,195    |   |   |   | 1,504 |   |   |   | 6,164 |   |
| Total advisory fees and other income                                                                               |   |                          | 2,528    |   |   |   | 3,110 |   |   |   | 11,090 |   |
| Total revenue                                                                                                      |   |                          | 99,834   |   |   |   | 135,365 |   |   |   | 187,119 |   |
| Operating expenses                                                                                                 |   |                          |     |   |   |   |   |   |   |   |   |   |
| Interest expense                                                                                                   |   |                          | 23,444   |   |   |   | 35,431 |   |   |   | 43,119 |   |
| Employee compensation                                                                                              |   |                          |     |   |   |   |   |   |   |   |   |   |
| Salaries and benefits                                                                                              |   |                          | 14,825   |   |   |   | 16,490 |   |   |   | 21,800 |   |
| Amortization of employee restricted stock awards                                                                   |   |                          | 7,727    |   |   |   | 6,855 |   |   |   | 9,024 |   |
| Total employee compensation                                                                                        |   |                          | 22,552   |   |   |   | 23,345 |   |   |   | 30,824 |   |
| General and administrative expense                                                                                 |   |                          | 15,650   |   |   |   | 16,648 |   |   |   | 11,258 |   |
| Goodwill impairment                                                                                                |   |                          | —  |   |   |   | 3,851 |   |   |   | — |   |
| Total operating expenses                                                                                           |   |                          | 61,646   |   |   |   | 79,275 |   |   |   | 85,201 |   |
| Net operating income before net investment loss, gain on extinguishment of debt and income tax (benefit) provision |   |                          | 38,188   |   |   |   | 56,090 |   |   |   | 101,918 |   |
| Net realized (loss) gain on investments                                                                            |   |                          |     |   |   |   |   |   |   |   |   |   |
| Non-affiliate investments (less than 5% owned)                                                                     |   |                          | (18,015  | ) |   |   | 5,868 |   |   |   | 7,037 |   |
| Affiliate investments (5% to 25% owned)                                                                            |   |                          | (1,947   | ) |   |   | (61 | ) |   |   | 7,522 |   |
| Control investments (more than 25% owned)                                                                          |   |                          | (172,022 | ) |   |   | (15,190 | ) |   |   | 7,191 |   |
| Total net realized (loss) gain on investments                                                                      |   |                          | (191,984 | ) |   |   | (9,383 | ) |   |   | 21,750 |   |
| Net unrealized appreciation (depreciation) on investments                                                          |   |                          |     |   |   |   |   |   |   |   |   |   |
| Non-affiliate investments (less than 5% owned)                                                                     |   |                          | (6,803   | ) |   |   | (53,312 | ) |   |   | 2,202 |   |
| Affiliate investments (5% to 25% owned)                                                                            |   |                          | (5,442   | ) |   |   | 3,900 |   |   |   | 2,860 |   |
| Control investments (more than 25% owned)                                                                          |   |                          | 110,642  |   |   |   | (198,252 | ) |   |   | (39,280 | ) |
| Derivative and other fair value adjustments                                                                        |   |                          | (766     | ) |   |   | (554 | ) |   |   | (419 | ) |
| Total net unrealized appreciation (depreciation) on investments                                                    |   |                          | 97,631   |   |   |   | (248,218 | ) |   |   | (34,637 | ) |
| Net investment loss before income tax (benefit) provision                                                          |   |                          | (94,353  | ) |   |   | (257,601 | ) |   |   | (12,887 | ) |
| Gain on extinguishment of debt before income tax (benefit) provision                                               |   |                          | 5,025    |   |   |   | 11,055 |   |   |   | — |   |
| Income tax (benefit) provision                                                                                     |   |                          | (81      | ) |   |   | 789 |   |   |   | 2,395 |   |
| Net (loss) income                                                                                                  |   | $                             | (51,059  | ) |   | $ | (191,245 | ) |   | $ | 86,636 |   |
| (Loss) earnings per basic and diluted common share                                                                 |   | $                             | (0.68    | ) |   | $ | (2.65 | ) |   | $ | 1.32 |   |
| Cash distributions declared per common share                                                                       |   | $                             | —  |   |   | $ | 0.71 |   |   | $ | 1.76 |   |
| Weighted-average common shares outstanding—basic and diluted                                                 |   |                          | 74,692   |   |   |   | 72,254 |   |   |   | 65,606 |   |

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|                                                                                                                                                                                                       |   | Years ended December 31, |     |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------|----------|
| (in thousands, except per share amounts)                                                                                                                                                                   |   | 2009                          |     |   | 2008 |   |   | 2007 |   |
| (Decrease) increase in net assets from operations                                                                                                                                                          |   |                          |     |   |   |   |   |   |   |
| Net operating income before net investment loss, gain on extinguishment of debt and income tax benefit (provision)                                                                                         |   | $                             | 38,188   |   |   | $ | 56,090 |   |   | $ | 101,918 |   |
| Net realized (loss) gain on investments                                                                                                                                                                    |   |                          | (191,984 | ) |   |   | (9,383 | ) |   |   | 21,750 |   |
| Net unrealized appreciation (depreciation) on investments                                                                                                                                                  |   |                          | 97,631   |   |   |   | (248,218 | ) |   |   | (34,637 | ) |
| Gain on extinguishment of debt                                                                                                                                                                             |   |                          | 5,025    |   |   |   | 11,055 |   |   |   | — |   |
| Income tax benefit (provision)                                                                                                                                                                             |   |                          | 81       |   |   |   | (789 | ) |   |   | (2,395 | ) |
| Net (loss) income                                                                                                                                                                                          |   |                          | (51,059  | ) |   |   | (191,245 | ) |   |   | 86,636 |   |
| Distributions to stockholders                                                                                                                                                                              |   |                          |     |   |   |   |   |   |   |   |   |   |
| Distributions from net investment income                                                                                                                                                                   |   |                          | —  |   |   |   | 29,528 |   |   |   | (103,785 | ) |
| Distributions in excess of net investment income (accumulated distributions in excess of net investment income and capital gains for December 31, 2009, 2008 and 2007 were $162,783, $162,783 and $84,070) |   |                          | —  |   |   |   | (78,713 | ) |   |   | (5,998 | ) |
| Net decrease in net assets resulting from stockholder distributions                                                                                                                                        |   |                          | —  |   |   |   | (49,185 | ) |   |   | (109,783 | ) |
| Capital share transactions                                                                                                                                                                                 |   |                          |     |   |   |   |   |   |   |   |   |   |
| Issuance of common stock                                                                                                                                                                                   |   |                          | —  |   |   |   | 57,038 |   |   |   | 95,350 |   |
| Amortization of restricted stock awards                                                                                                                                                                    |   |                          |     |   |   |   |   |   |   |   |   |   |
| Employee                                                                                                                                                                                                   |   |                          | 7,727    |   |   |   | 6,855 |   |   |   | 9,024 |   |
| Restructuring expense                                                                                                                                                                                      |   |                          | —  |   |   |   | 106 |   |   |   | — |   |
| Non-employee director                                                                                                                                                                                      |   |                          | 135      |   |   |   | 255 |   |   |   | 174 |   |
| Cancellation of common stock held as collateral for stockholder loans                                                                                                                                      |   |                          | (92      | ) |   |   | (105 | ) |   |   | — |   |
| Stockholder loans                                                                                                                                                                                          |   |                          |     |   |   |   |   |   |   |   |   |   |
| Unrealized (appreciation) depreciation on stockholder loans                                                                                                                                                |   |                          | (31      | ) |   |   | 398 |   |   |   | — |   |
| Repayment of stockholder loans                                                                                                                                                                             |   |                          | 92       |   |   |   | 105 |   |   |   | 151 |   |
| Net increase in net assets resulting from capital share transactions                                                                                                                                       |   |                          | 7,831    |   |   |   | 64,652 |   |   |   | 104,699 |   |
| Total decrease in net assets                                                                                                                                                                               |   |                          | (43,228  | ) |   |   | (175,778 | ) |   |   | 81,552 |   |
| Net assets                                                                                                                                                                                                 |   |                          |     |   |   |   |   |   |   |   |   |   |
| Beginning of period                                                                                                                                                                                        |   |                          | 658,911  |   |   |   | 834,689 |   |   |   | 753,137 |   |
| End of period                                                                                                                                                                                              |   | $                             | 615,683  |   |   | $ | 658,911 |   |   | $ | 834,689 |   |
| Net asset value per common share at end of period                                                                                                                                                          |   | $                             | 8.06     |   |   | $ | 8.66 |   |   | $ | 12.73 |   |
| Common shares outstanding at end of period                                                                                                                                                                 |   |                          | 76,394   |   |   |   | 76,075 |   |   |   | 65,587 |   |

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Table of Contents

|                                                                                              |   | Years ended December 31, |     |
|---------------------------------------------------------------------------------------------------|--------|-------------------------------|----------|
| (in thousands)                                                                                    |   | 2009                          |     |   | 2008 |   |   | 2007 |   |
| Cash flows from operating activities                                                              |   |                          |     |   |   |   |   |   |   |
| Net (loss) income                                                                                 |   | $                             | (51,059  | ) |   | $ | (191,245 | ) |   | $ | 86,636 |   |
| Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities |   |                          |     |   |   |   |   |   |   |   |   |   |
| Investments in portfolio companies                                                                |   |                          | (58,673  | ) |   |   | (87,530 | ) |   |   | (603,818 | ) |
| Principal collections related to investment repayments or sales                                   |   |                          | 196,575  |   |   |   | 203,881 |   |   |   | 341,551 |   |
| Increase in interest receivable, accrued payment-in-kind interest and dividends                   |   |                          | (13,330  | ) |   |   | (26,415 | ) |   |   | (49,980 | ) |
| Amortization of restricted stock awards                                                           |   |                          |     |   |   |   |   |   |   |   |   |   |
| Employee                                                                                          |   |                          | 7,727    |   |   |   | 6,961 |   |   |   | 9,024 |   |
| Non-employee director                                                                             |   |                          | 135      |   |   |   | 255 |   |   |   | 174 |   |
| Decrease (increase) in cash—securitization accounts from interest collections               |   |                          | 1,305    |   |   |   | (566 | ) |   |   | (15,226 | ) |
| Depreciation and amortization                                                                     |   |                          | 5,395    |   |   |   | 3,763 |   |   |   | 1,903 |   |
| Impairment of goodwill                                                                            |   |                          | —  |   |   |   | 3,851 |   |   |   | — |   |
| Unrealized (appreciation) depreciation on stockholder loans                                       |   |                          | (31      | ) |   |   | 398 |   |   |   | — |   |
| Decrease (increase) in other assets                                                               |   |                          | 1,160    |   |   |   | (3,848 | ) |   |   | 3,407 |   |
| Increase (decrease) in other liabilities                                                          |   |                          | 663      |   |   |   | (5,592 | ) |   |   | 3,243 |   |
| Realized loss (gain) on investments                                                               |   |                          | 191,984  |   |   |   | 9,383 |   |   |   | (21,750 | ) |
| Change in unrealized (appreciation) depreciation on investments                                   |   |                          | (97,631  | ) |   |   | 248,218 |   |   |   | 34,637 |   |
| Gain on extinguishment of debt                                                                    |   |                          | (5,025   | ) |   |   | (11,055 | ) |   |   | — |   |
| Net cash provided by (used in) operating activities                                               |   |                          | 179,195  |   |   |   | 150,459 |   |   |   | (210,199 | ) |
|                                                                                              |   |                          |     |   |   |   |   |   |   |   |   |   |
| Cash flows from financing activities                                                              |   |                          |     |   |   |   |   |   |   |   |   |   |
| Net (payments) proceeds on borrowings                                                             |   |                          | (73,776  | ) |   |   | (103,091 | ) |   |   | 229,152 |   |
| (Increase) decrease in cash in restricted and securitization accounts                             |   |                          |     |   |   |   |   |   |   |   |   |   |
| Securitization accounts for repayment of principal on debt                                        |   |                          | (72,953  | ) |   |   | 76 |   |   |   | (5,846 | ) |
| Restricted cash                                                                                   |   |                          | (20,253  | ) |   |   | — |   |   |   | — |   |
| Payment of financing costs                                                                        |   |                          | (4,175   | ) |   |   | (3,500 | ) |   |   | (1,165 | ) |
| Issuance of common stock, net of costs                                                            |   |                          | —  |   |   |   | 57,038 |   |   |   | 95,350 |   |
| Distributions paid                                                                                |   |                          | —  |   |   |   | (78,130 | ) |   |   | (105,837 | ) |
| Cancellation of common stock held as collateral for stockholder loans                             |   |                          | (92      | ) |   |   | (105 | ) |   |   | — |   |
| Repayment of stockholder loans                                                                    |   |                          | 92       |   |   |   | 105 |   |   |   | 151 |   |
| Net cash (used in) provided by financing activities                                               |   |                          | (171,157 | ) |   |   | (127,607 | ) |   |   | 211,805 |   |
| Increase in cash and cash equivalents                                                             |   |                          | 8,038    |   |   |   | 22,852 |   |   |   | 1,606 |   |
| Cash and cash equivalents                                                                         |   |                          |     |   |   |   |   |   |   |   |   |   |
| Beginning balance                                                                                 |   |                          | 46,149   |   |   |   | 23,297 |   |   |   | 21,691 |   |
| Ending balance                                                                                    |   | $                             | 54,187   |   |   | $ | 46,149 |   |   | $ | 23,297 |   |
| Supplemental disclosure of cash flow information                                                  |   |                          |     |   |   |   |   |   |   |   |   |   |
| Interest paid                                                                                     |   | $                             | 22,056   |   |   | $ | 34,282 |   |   | $ | 40,240 |   |
| Income taxes paid                                                                                 |   |                          | 59       |   |   |   | 905 |   |   |   | 4,258 |   |
| Payment-in-kind interest collected                                                                |   |                          | 2,214    |   |   |   | 6,230 |   |   |   | 13,848 |   |
| Dividend income collected                                                                         |   |                          | 8,414    |   |   |   | 3,817 |   |   |   | 7,328 |   |

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Table of Contents

| Portfolio Company                                                               | Industry         | Investment(9)                                      |   | Principal |   |   | Cost   |    |    | Fair Value |   |
|---------------------------------------------------------------------------------|------------------|----------------------------------------------------|--------|-----------|--------|--------|--------|---------|---------|------------|--------|
| Control Investments(4):                                                         |             |                                               |   |      |   |   |   |    |    |       |
| Avenue Broadband                                                                | Cable            | Subordinated Debt (14.0%, Due 3/14)(1)             |   | $         | 14,436 |   |   | $       | 14,349  |       |   | $ | 14,349 |   |
| LLC(2)                                                                          |             | Preferred Units (10.8%, 17,100 units)(1)           |   |      |   |   |   |    | 20,878  |       |   |   | 26,601 |   |
|                                                                            |             | Warrants to purchase Class B Common Stock          |   |      |   |   |   |    | — |       |   |   | — |   |
| Broadview Networks                                                              | Communications-  | Series A Preferred Stock (12.0%, 87,254 shares)    |   |      |   |   |   |    | 81,984  |       |   |   | 70,139 |   |
| Holdings, Inc.(6)                                                               | CLEC             | Series A-1 Preferred Stock (12.0%, 100,702 shares) |   |      |   |   |   |    | 77,495  |       |   |   | 68,695 |   |
|                                                                            |             | Class A Common Stock (4,698,987 shares)            |   |      |   |   |   |    | — |       |   |   | — |   |
| GMC Television                                                                  | Broadcasting     | Senior Debt (4.3%, Due 12/16)(1)                   |   |      | 23,720 |   |   |    | 21,336  |       |   |   | 21,500 |   |
| Broadcasting, LLC(2)(6)(19)                                                     |             | Subordinated Debt (14.0%, Due 12/16)(1)(7)         |   |      | 9,086  |   |   |    | 6,975   |       |   |   | — |   |
|                                                                            |             | Subordinated Unsecured Debt (16.0%, Due 12/16)(7)  |   |      | 1,067  |   |   |    | 1,000   |       |   |   | — |   |
|                                                                            |             | Class B Voting Units (8.0%, 86,700 units)          |   |      |   |   |   |    | 9,071   |       |   |   | — |   |
| Intran Media, LLC                                                               | Other Media      | Senior Debt (9.5%, Due 12/11)(1)                   |   |      | 9,000  |   |   |    | 8,926   |       |   |   | 8,926 |   |
|                                                                            |             | Series A Preferred Units (10.0%, 86,000 units)     |   |      |   |   |   |    | 9,095   |       |   |   | 1,330 |   |
|                                                                            |             | Series B Preferred Units (10.0%, 30,000 units)     |   |      |   |   |   |    | 3,000   |       |   |   | 159 |   |
| Jet Plastica Investors,                                                         | Plastic Products | Senior Debt (9.3%, Due 12/12)(1)                   |   |      | 12,533 |   |   |    | 12,441  |       |   |   | 12,441 |   |
| LLC(2)                                                                          |             | Subordinated Debt A (15.5%, Due 3/13)(1)           |   |      | 18,713 |   |   |    | 18,520  |       |   |   | 18,520 |   |
|                                                                            |             | Subordinated Debt B (17.0%, Due 3/13)(1)(8)        |   |      | 19,563 |   |   |    | 17,560  |       |   |   | 11,826 |   |
|                                                                            |             | Preferred LLC Interest (8.0%, 301,595 units)       |   |      |   |   |   |    | 34,014  |       |   |   | — |   |
| JetBroadband Holdings, LLC(2)                                                   | Cable            | Subordinated Unsecured Debt (14.9%, Due 8/15-2/16) |   |      | 28,603 |   |   |    | 28,440  |       |   |   | 28,440 |   |
|                                                                            |             | Series A Preferred Units (10.0%, 133,204 units)    |   |      |   |   |   |    | 18,471  |       |   |   | 11,809 |   |
|                                                                            |             | Series B Preferred Units (24,441 units)            |   |      |   |   |   |    | 5,000   |       |   |   | 10,000 |   |
| MTP Holding, LLC(6)                                                             | Communications-  | Common LLC Interest (79,171 units)                 |   |      |   |   |   |    | 3       |       |   |   | 28 |   |
|                                                                            | Other            |                                               |   |      |   |   |   |    |    |       |   |   |   |   |
| NPS Holdings                                                                    | Business         | Senior Debt A1 (6.0%, Due 6/13)(1)                 |   |      | 4,702  |   |   |    | 3,382   |       |   |   | 3,382 |   |
| Group, LLC(2)(5)(17)                                                            | Services         | Senior Debt A2 and A3 (6.0%, Due 6/13)(1)(7)       |   |      | 9,942  |   |   |    | 8,150   |       |   |   | 149 |   |
|                                                                            |             | Series A Preferred Units (347 units)               |   |      |   |   |   |    | — |       |   |   | — |   |
|                                                                            |             | Series B Preferred Units (5.0%, 10,731 units)      |   |      |   |   |   |    | 10,731  |       |   |   | — |   |
|                                                                            |             | Common Stock (36,500 units)                        |   |      |   |   |   |    | — |       |   |   | — |   |
| Orbitel Holdings, LLC(2)                                                        | Cable            | Senior Debt (9.0%, Due 3/12)(1)                    |   |      | 16,300 |   |   |    | 16,225  |       |   |   | 16,225 |   |
|                                                                            |             | Preferred LLC Interest (10.0%, 120,000 units)      |   |      |   |   |   |    | 13,996  |       |   |   | 12,251 |   |
| PremierGarage                                                                   | Home Furnishings | Senior Debt (8.0%, Due 12/10-9/11)(1)(7)           |   |      | 9,953  |   |   |    | 9,149   |       |   |   | 9,887 |   |
| Holdings, LLC(2)(6)                                                             |             | Preferred LLC Units (400 units)                    |   |      |   |   |   |    | 400     |       |   |   | 289 |   |
|                                                                            |             | Common LLC Units (79,935 units)                    |   |      |   |   |   |    | 4,971   |       |   |   | — |   |
| RadioPharmacy                                                                   | Healthcare       | Senior Debt (7.0%, Due 12/10)(1)                   |   |      | 8,500  |   |   |    | 8,484   |       |   |   | 8,484 |   |
| Investors, LLC(2)                                                               |             | Subordinated Debt (15.0%, Due 12/11)(1)            |   |      | 10,140 |   |   |    | 10,111  |       |   |   | 10,111 |   |
|                                                                            |             | Preferred LLC Interest (8.0%, 70,000 units)        |   |      |   |   |   |    | 8,123   |       |   |   | 69 |   |
| Superior Industries                                                             | Sporting Goods   | Subordinated Debt (16.0%, Due 3/13)(1)             |   |      | 20,212 |   |   |    | 20,126  |       |   |   | 20,126 |   |
| Investors, LLC(2)                                                               |             | Preferred Units (8.0%, 125,400 units)              |   |      |   |   |   |    | 15,272  |       |   |   | 18,977 |   |
| Total Sleep Holdings,                                                           | Healthcare       | Subordinated Debt (8.0%, Due 9/11)(7)              |   |      | 12,037 |   |   |    | 11,780  |       |   |   | 5,271 |   |
| Inc.(2)(6)                                                                      |             | Unsecured Note (0.0%, Due 6/11)(7)                 |   |      | 375    |   |   |    | 332     |       |   |   | — |   |
|                                                                            |             | Series A Preferred Stock (10.0%, 3,700 shares)     |   |      |   |   |   |    | 3,793   |       |   |   | — |   |
|                                                                            |             | Series B Preferred Stock (10.0%, 2,752 shares)     |   |      |   |   |   |    | 21,149  |       |   |   | — |   |
|                                                                            |             | Common Stock (40,469 shares)                       |   |      |   |   |   |    | 1,000   |       |   |   | — |   |
| Total Control Investments (represents 41.6% of total investments at fair value) |             |                                               |   | 555,732   |   |   |   | 409,984 |    |

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Table of Contents

| Portfolio Company                                                                | Industry          | Investment(9)                                                              |   | Principal |   |   | Cost   |   |    | Fair Value |   |
|----------------------------------------------------------------------------------|-------------------|----------------------------------------------------------------------------|--------|-----------|--------|--------|--------|--------|---------|------------|--------|
| Affiliate Investments(3):                                                        |              |                                                                       |   |      |   |   |   |   |    |
| Advanced Sleep                                                                   | Home Furnishings  | Senior Debt (13.3%, Due 10/11)(1)                                          |   | $         | 5,985  |   |   | $      | 5,890   |       |   | $ | 5,627 |   |
| Concepts, Inc.(2)                                                                |              | Subordinated Debt (16.0%, Due 4/12)(1)                                     |   |      | 5,125  |   |   |   | 5,034   |       |   |   | 4,817 |   |
|                                                                             |              | Series A Preferred Stock (20.0%, 49 shares)                                |   |      |   |   |   |   | 297     |       |   |   | — |   |
|                                                                             |              | Common Stock (423 shares)                                                  |   |      |   |   |   |   | 524     |       |   |   | — |   |
|                                                                             |              | Warrants to purchase Common Stock (expire 10/16)                           |   |      |   |   |   |   | 348     |       |   |   | — |   |
| Cherry Hill Holdings,                                                            | Entertainment     | Series A Preferred Stock (10.0%, 750 shares)                               |   |      |   |   |   |   | 907     |       |   |   | 906 |   |
| Inc.(6)                                                                          |              |                                                                       |   |      |   |   |   |   |    |       |   |   |   |   |
| Stratford School                                                                 | Education         | Senior Debt (6.9%, Due 7/11-9/11)(1)                                       |   |      | 3,440  |   |   |   | 3,404   |       |   |   | 3,368 |   |
| Holdings, Inc.(2)                                                                |              | Subordinated Debt (14.0%, Due 12/11)(1)                                    |   |      | 6,717  |   |   |   | 6,695   |       |   |   | 6,695 |   |
|                                                                             |              | Series A Convertible Preferred Stock (12.0%, 10,000 shares)                |   |      |   |   |   |   | 240     |       |   |   | 6,835 |   |
|                                                                             |              | Warrants to purchase Common Stock (expire 5/15)(1)                         |   |      |   |   |   |   | 67      |       |   |   | 1,846 |   |
| Sunshine Media                                                                   | Publishing        | Common Stock (145 shares)                                                  |   |      |   |   |   |   | 581     |       |   |   | — |   |
| Delaware, LLC(2)(6)                                                              |              | Class A LLC Interest (8.0%, 563,808 units)                                 |   |      |   |   |   |   | 564     |       |   |   | — |   |
|                                                                             |              | Options to acquire Warrants to purchase Class B LLC Interest (expire 5/14) |   |      |   |   |   |   | — |       |   |   | — |   |
| Velocity Technology                                                              | Business Services | Senior Debt (7.8%, Due 12/12)(1)                                           |   |      | 12,859 |   |   |   | 12,794  |       |   |   | 12,794 |   |
| Enterprises, Inc.(2)(21)                                                         |              | Series A Preferred Stock (1,506,602 shares)                                |   |      |   |   |   |   | 1,500   |       |   |   | 1,500 |   |
| Total Affiliate Investments (represents 4.5% of total investments at fair value) |              |                                                                       |   |      |   |   | 38,845 |   |    |       | 44,388 |   |

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Table of Contents

| Portfolio Company                               | Industry                       | Investment(9)                                                |   | Principal |   |   | Cost   |   |    | Fair Value |   |
|-------------------------------------------------|--------------------------------|--------------------------------------------------------------|--------|-----------|--------|--------|--------|--------|---------|------------|--------|
|                                            |                           |                                                         |   |      |   |   |   |   |    |
| Non-Affiliate Investments (less than 5% owned): |                           |                                                         |   |      |   |   |   |   |    |
| Active Brands                                   | Consumer Products              | Senior Debt (10.3%, Due 6/12)(1)(8)                          |   | $         | 24,601 |   |   | $      | 24,155  |       |   | $ | 18,665 |   |
| International, lnc.(2)                          |                           | Subordinated Debt (17.0%, Due 9/12)(1)(7)                    |   |      | 15,446 |   |   |   | 12,437  |       |   |   | — |   |
|                                            |                           | Class A-1 Common Stock (3,056 shares)                        |   |      |   |   |   |   | 3,056   |       |   |   | — |   |
|                                            |                           | Warrants to purchase Class A-1 Common Stock (expire 6/17)    |   |      |   |   |   |   | 331     |       |   |   | — |   |
| Allen’s T.V. Cable                        | Cable                          | Senior Debt (7.3%, Due 12/12)(1)                             |   |      | 6,280  |   |   |   | 6,258   |       |   |   | 6,258 |   |
| Service, Inc.                                   |                           | Subordinated Debt (10.1%, Due 12/12)(1)                      |   |      | 2,488  |   |   |   | 2,442   |       |   |   | 2,358 |   |
|                                            |                           | Warrants to purchase Common Stock (expire 11/15)             |   |      |   |   |   |   | — |       |   |   | 95 |   |
| Amerifit Nutrition, Inc.(2)(20)                 | Healthcare                     | Senior Debt (12.0%, Due 3/10)(1)                             |   |      | 2,567  |   |   |   | 2,559   |       |   |   | 2,559 |   |
| B & H Education, Inc.                       | Education                      | Series A-1 Convertible Preferred Stock (12.0%, 5,384 shares) |   |      |   |   |   |   | 1,669   |       |   |   | 5,383 |   |
| BLI Holdings, Inc.(2)(22)                       | Drugs                          | Senior Debt (11.3%, Due 2/10)(1)                             |   |      | 10,393 |   |   |   | 10,216  |       |   |   | 10,213 |   |
| Coastal Sunbelt                                 | Food Services                  | Senior Debt (9.1%, Due 8/14-2/15)(1)                         |   |      | 22,061 |   |   |   | 21,838  |       |   |   | 21,838 |   |
| Holding, Inc.(2)(18)                            |                           | Subordinated Debt (16.0%, Due 8/15)(1)                       |   |      | 8,509  |   |   |   | 8,430   |       |   |   | 8,430 |   |
| Coastal Sunbelt Real                            | Real Estate                    | Subordinated Unsecured Debt (15.0%, Due 7/12)                |   |      | 2,190  |   |   |   | 2,180   |       |   |   | 2,178 |   |
| Estate, Inc.                                    | Investments                    | Series A-2 Preferred Stock (12.0%, 20,000 shares)            |   |      |   |   |   |   | 2,656   |       |   |   | 525 |   |
|                                            |                           | Warrants to purchase Class B Common Stock                    |   |      |   |   |   |   | — |       |   |   | — |   |
| Construction Trailer Specialists, Inc.(2)       | Auto Parts                     | Senior Debt (14.1%, Due 7/12-10/12)(1)(8)                    |   |      | 9,499  |   |   |   | 9,350   |       |   |   | 8,105 |   |
| Cruz Bay Publishing, Inc.                       | Publishing                     | Subordinated Debt (12.8%, Due 12/13)(1)                      |   |      | 20,000 |   |   |   | 19,805  |       |   |   | 13,998 |   |
| CWP/RMK Acquisition                             | Home Furnishings               | Senior Debt (3.0%, Due 12/16)(7)                             |   |      | 600    |   |   |   | 597     |       |   |   | 409 |   |
| Corp.(2)(6)                                     |                           |                                                         |   |      |   |   |   |   |    |       |   |   |   |   |
| Dayton Parts Holdings,                          | Auto Parts                     | Preferred LLC Interest (10.0%, 16,470 units)                 |   |      |   |   |   |   | 631     |       |   |   | 615 |   |
| LLC                                             |                           | Class A Common LLC Interest (8.0%, 10,980 units)             |   |      |   |   |   |   | 400     |       |   |   | — |   |
| Empower IT Holdings, Inc.(2)                    | Information Services           | Senior Debt (11.0%, Due 5/12)(1)                             |   |      | 6,015  |   |   |   | 5,958   |       |   |   | 5,958 |   |
| Equibrand Holding                               | Leisure Activities             | Senior Debt (9.5%, Due 6/11)(1)                              |   |      | 4,640  |   |   |   | 4,609   |       |   |   | 4,609 |   |
| Corporation(2)                                  |                           | Subordinated Debt (17.0%, Due 12/11)(1)                      |   |      | 9,643  |   |   |   | 9,577   |       |   |   | 9,577 |   |
| G&L Investment                              | Insurance                      | Subordinated Debt (7.8%, Due 5/14)(1)                        |   |      | 17,500 |   |   |   | 17,021  |       |   |   | 15,778 |   |
| Holdings, LLC(2)                                |                           | Series A Preferred Shares (14.0%, 5,000,000 shares)          |   |      |   |   |   |   | 6,667   |       |   |   | 6,667 |   |
|                                            |                           | Class C Shares (621,907 shares)                              |   |      |   |   |   |   | 529     |       |   |   | 370 |   |
| Golden Knight II CLO, Ltd.(6)                   | Diversified Financial Services | Income Notes (8.0%, Due 4/19)                                |   |      |   |   |   |   | 3,575   |       |   |   | 1,836 |   |
| GSDM Holdings, LLC(2)                           | Healthcare                     | Senior Debt (7.5%, Due 2/13)(1)                              |   |      | 7,673  |   |   |   | 7,611   |       |   |   | 7,527 |   |
|                                            |                           | Subordinated Debt (14.0%, Due 8/13)(1)                       |   |      | 7,968  |   |   |   | 7,935   |       |   |   | 7,935 |   |
|                                            |                           | Series B Preferred Units (12.5%, 4,213,333 units)            |   |      |   |   |   |   | 4,397   |       |   |   | 2,774 |   |
| Home Interiors & Gifts, Inc.(6)(10)         | Home Furnishings               | Senior Debt (8.0%, Due 3/11)(7)                              |   |      | 4,141  |   |   |   | 3,667   |       |   |   | 21 |   |
| Jenzabar, Inc.(23)                              | Technology                     | Senior Preferred Stock (11.0%, 3,750 shares)                 |   |      |   |   |   |   | 6,019   |       |   |   | 6,019 |   |
|                                            |                           | Subordinated Preferred Stock (109,800 shares)                |   |      |   |   |   |   | 1,098   |       |   |   | 1,098 |   |
|                                            |                           | Warrants to purchase Common Stock (expire 4/16)              |   |      |   |   |   |   | 422     |       |   |   | 20,478 |   |
| Lambeau Telecom Company, LLC(14)                | Communications-CLEC            | Senior Debt (12.0%, Due 2/13)(8)                             |   |      | 1,380  |   |   |   | 1,353   |       |   |   | 1,059 |   |
| Legacy Cabinets, Inc.(6)                        | Home Furnishings               | Subordinated Debt (12.5%, Due 8/13)(1)(7)                    |   |      | 2,328  |   |   |   | 2,184   |       |   |   | — |   |
| LMS INTELLIBOUND,                               | Logistics                      | Senior Debt (8.6%, Due 3/14–6/14)(1)                   |   |      | 25,193 |   |   |   | 24,848  |       |   |   | 24,848 |   |
| INC.(2)                                         |                           | Subordinated Debt (16.0%, Due 9/14)(1)                       |   |      | 7,000  |   |   |   | 6,846   |       |   |   | 6,846 |   |
| Maverick Healthcare                             | Healthcare                     | Subordinated Debt (16.0%, Due 4/14)(1)                       |   |      | 12,894 |   |   |   | 12,753  |       |   |   | 12,753 |   |
| Equity, LLC                                     |                           | Preferred Units (10.0%, 1,250,000 units)                     |   |      |   |   |   |   | 1,432   |       |   |   | 1,432 |   |
|                                            |                           | Class A Common Units (1,250,000 units)                       |   |      |   |   |   |   | — |       |   |   | — |   |
| MCI Holdings LLC(2)                             | Healthcare                     | Subordinated Debt (12.7%, Due 4/13)(1)                       |   |      | 32,307 |   |   |   | 32,186  |       |   |   | 32,186 |   |
|                                            |                           | Class A LLC Interest (4,712,042 units)                       |   |      |   |   |   |   | 3,000   |       |   |   | 9,177 |   |

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Table of Contents

| Portfolio Company                                                                     | Industry             | Investment(9)                                                      |   | Principal |   |   | Cost    |   |      | Fair Value |    |
|---------------------------------------------------------------------------------------|----------------------|--------------------------------------------------------------------|--------|-----------|--------|--------|---------|--------|-----------|------------|---------|
| Metropolitan                                                                          | Communications-      | Senior Debt (10.8%, Due 12/11)(1)                                  |   | $         | 20,327 |   |    | $      | 20,247    |       |    | $ | 20,247 |   |
| Telecommunications Holding Company(2)                                                 | CLEC                 | Warrants to purchase Common Stock (expire 9/13)                    |   |      |   |   |    |   | 1,843     |       |    |   | 9,989 |   |
| Miles Media Group, LLC(2)                                                             | Publishing           | Senior Debt (12.5%, Due 6/13)(1)                                   |   |      | 17,369 |   |    |   | 17,095    |       |    |   | 17,095 |   |
| NDSSI Holdings, LLC(2)                                                                | Electronics          | Senior Debt (9.9%, Due 9/13-3/14)(1)                               |   |      | 19,373 |   |    |   | 19,209    |       |    |   | 18,473 |   |
|                                                                                  |                 | Subordinated Debt (15.0%, Due 9/14)(1)                             |   |      | 22,384 |   |    |   | 22,323    |       |    |   | 22,323 |   |
|                                                                                  |                 | Series A Preferred Units (516,691 units)                           |   |      |   |   |    |   | 718       |       |    |   | 718 |   |
|                                                                                  |                 | Class A Common Units (1,000,000 units)                             |   |      |   |   |    |   | 333       |       |    |   | 568 |   |
| Philadelphia Newspapers, LLC(6)(12)                                                   | Newspaper            | Subordinated Unsecured Debt (16.5%, Due 6/14)(7)                   |   |      | 5,082  |   |    |   | 5,070     |       |    |   | — |   |
| Powercom Corporation(6)(14)                                                           | Communications-CLEC  | Warrants to purchase Class A Common Stock (expire 6/14)            |   |      |   |   |    |   | 286       |       |    |   | — |   |
| Quantum Medical                                                                       | Laboratory           | Senior Debt (6.3%, Due 5/11)(1)                                    |   |      | 15,500 |   |    |   | 15,481    |       |    |   | 15,481 |   |
| Holdings, LLC (2)                                                                     | Instruments          | Subordinated Debt (15.0%, Due 12/11)(1)                            |   |      | 18,032 |   |    |   | 17,952    |       |    |   | 17,952 |   |
|                                                                                  |                 | Preferred LLC Interest (1,000,000 units)                           |   |      |   |   |    |   | 640       |       |    |   | 1,357 |   |
| Restaurant Technologies,                                                              | Food Services        | Senior Debt (17.6%, Due 2/12)(1)                                   |   |      | 39,824 |   |    |   | 39,567    |       |    |   | 39,567 |   |
| Inc.                                                                                  |                 | Common Stock (47,512 shares)                                       |   |      |   |   |    |   | 352       |       |    |   | 51 |   |
|                                                                                  |                 | Warrants to purchase Common Stock (expire 6/14)                    |   |      |   |   |    |   | —   |       |    |   | 149 |   |
| Sagamore Hill Broadcasting, LLC(2)                                                    | Broadcasting         | Senior Debt (15.5%, Due 8/11)(1)(8)                                |   |      | 26,559 |   |    |   | 25,964    |       |    |   | 24,730 |   |
| Summit Business Media Intermediate Holding Company, LLC(6)                            | Information Services | Subordinated Debt (15.0%, Due 7/14)(1)(7)                          |   |      | 6,647  |   |    |   | 5,996     |       |    |   | 896 |   |
| Teleguam Holdings, LLC(2)                                                             | Communications-Other | Subordinated Debt (7.2%, Due 10/12)(1)                             |   |      | 20,000 |   |    |   | 19,876    |       |    |   | 17,989 |   |
| The e-Media Club I, LLC(6)                                                            | Investment Fund      | LLC Interest (74 units)                                            |   |      |   |   |    |   | 88        |       |    |   | 7 |   |
| The Matrixx Group, Incorporated                                                       | Plastic Products     | Subordinated Debt (17.0%, Due 11/14)(1)                            |   |      | 14,662 |   |    |   | 14,662    |       |    |   | 14,662 |   |
| ValuePage, Inc.(6)                                                                    | Communications-Other | Senior Debt (12.8%, Due 6/08)(7)                                   |   |      | 1,274  |   |    |   | 993       |       |    |   | 3 |   |
| VOX Communications                                                                    | Broadcasting         | Senior Debt (13.5%, Due 3/09)(1)(7)                                |   |      | 11,483 |   |    |   | 10,463    |       |    |   | 6,025 |   |
| Group Holdings, LLC(2)(6)                                                             |                 | Convertible Preferred Subordinated Notes (12.5%, Due 6/15-6/17)(7) |   |      | 2,170  |   |    |   | 1,414     |       |    |   | — |   |
| VS&A-PBI Holding LLC(6)                                                           | Publishing           | LLC Interest                                                       |   |      |   |   |    |   | 500       |       |    |   | — |   |
| WebMediaBrands Inc.(6)(13)                                                            | Information Services | Common Stock (148,373 shares)                                      |   |      |   |   |    |   | 2,115     |       |    |   | 131 |   |
| Wireco Worldgroup Inc.                                                                | Industrial Equipment | Senior Debt (2.5%, Due 2/14)(1)                                    |   |      | 3,890  |   |    |   | 3,908     |       |    |   | 3,354 |   |
| Xpressdocs Holdings,                                                                  | Business Services    | Senior Debt (11.5%, Due 4/12-4/13)(1)(8)                           |   |      | 20,208 |   |    |   | 20,055    |       |    |   | 19,630 |   |
| Inc.(2)                                                                               |                 | Series A Preferred Stock (161,870 shares)                          |   |      |   |   |    |   | 500       |       |    |   | — |   |
| Total Non-Affiliate Investments (represents 53.9% of total investments at fair value) |                 |                                                               |   |      |   |   | 560,347 |   |      |       | 531,974 |   |
| Total Investments                                                                     |                 |                                                               |   |      |   |   |    | $      | 1,154,924 |       |    | $ | 986,346 |   |

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Table of Contents

| Counterparty              | Instrument                                          |   | Interest Rate |   |   | Expiring |   |   | Notional |   |   | Cost   |   |   | Fair Value |    |
|---------------------------|-----------------------------------------------------|--------|---------------|--------|--------|----------|--------|--------|----------|--------|--------|--------|--------|--------|------------|---------|
| Interest Rate Swaps       |                                                |   |          |   |   |     |   |   |     |   |   |   |   |   |       |    |
| SunTrust Bank             | Interest Rate Swap—Pay Fixed/Receive Floating |   |          | 10.0   | %      |     |   | 11/10  |     |   | $      | 16,000 |   |   | $          | — |   |   | $ | (426 | ) |
|                      | Interest Rate Swap—Pay Fixed/Receive Floating |   |          | 14.0   | %      |     |   | 11/10  |     |   |   | 8,000  |   |   |       | — |   |   |   | (213 | ) |
|                      | Interest Rate Swap—Pay Fixed/Receive Floating |   |          | 13.0   | %      |     |   | 08/11  |     |   |   | 12,500 |   |   |       | — |   |   |   | (245 | ) |
|                      | Interest Rate Swap—Pay Fixed/Receive Floating |   |          | 9.0    | %      |     |   | 08/11  |     |   |   | 8,681  |   |   |       | — |   |   |   | (170 | ) |
| Total Interest Rate Swaps |                                                |   |          |   |   |     |   |   |     |   | $      | 45,181 |   |   | $          | — |   |   | $ | (1,054 | ) |

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Table of Contents

| Portfolio Company                | Industry             | Investment(9)                                      |   | Principal |   |   | Cost   |   |    | Fair Value |   |
|----------------------------------|----------------------|----------------------------------------------------|--------|-----------|--------|--------|--------|--------|---------|------------|--------|
| Control Investments(4):          |                 |                                               |   |      |   |   |   |   |    |       |
| Avenue Broadband                 | Cable                | Subordinated Debt (14.0%, Due 3/14-12/14)(1)       |   | $         | 13,727 |   |   | $      | 13,619  |       |   | $ | 13,619 |   |
| LLC(2)                           |                 | Preferred Units (10.0%, 17,100 units)(1)           |   |      |   |   |   |   | 18,960  |       |   |   | 25,992 |   |
|                             |                 | Warrants to purchase Class B Common Stock          |   |      |   |   |   |   | — |       |   |   | — |   |
| Broadview Networks               | Communications-      | Series A Preferred Stock (12.0%, 87,254 shares)    |   |      |   |   |   |   | 81,984  |       |   |   | 70,666 |   |
| Holdings, Inc.(6)                | CLEC                 | Series A-1 Preferred Stock (12.0%, 100,702 shares) |   |      |   |   |   |   | 77,495  |       |   |   | 68,659 |   |
|                             |                 | Class A Common Stock (4,698,987 shares)            |   |      |   |   |   |   | — |       |   |   | — |   |
| Cleartel Communications,         | Communications-      | Subordinated Debt (11.2%, Due 5/09-3/11)(7)        |   |      | 41,172 |   |   |   | 36,047  |       |   |   | — |   |
| Inc.(2)(6)(16)                   | CLEC                 | Series B Preferred Stock (8.0%, 57,862 shares)     |   |      |   |   |   |   | 50,612  |       |   |   | — |   |
|                             |                 | Common Stock (744,777 shares)                      |   |      |   |   |   |   | 62,125  |       |   |   | — |   |
|                             |                 | Guaranty ($5,000)                                  |   |      |   |   |   |   |    |       |   |   |   |   |
| Coastal Sunbelt,                 | Food Services        | Senior Debt (8.4%, Due 1/12-7/12)(1)               |   |      | 22,246 |   |   |   | 22,127  |       |   |   | 22,127 |   |
| LLC(2)(18)                       |                 | Subordinated Debt (14.8%, Due 1/13)(1)             |   |      | 8,223  |   |   |   | 8,115   |       |   |   | 8,115 |   |
|                             |                 | Preferred LLC Interest (12.0%, 123,250 units)      |   |      |   |   |   |   | 14,597  |       |   |   | 14,648 |   |
|                             |                 | Warrants to purchase Class B Common Stock          |   |      |   |   |   |   | — |       |   |   | — |   |
| Crystal Media Network, LLC(6)(5) | Broadcasting         | LLC Interest                                       |   |      |   |   |   |   | 2,447   |       |   |   | 2,556 |   |
| GMC Television                   | Broadcasting         | Senior Debt (9.2%, Due 4/12-6/12)(1)(7)            |   |      | 23,712 |   |   |   | 22,520  |       |   |   | 22,520 |   |
| Broadcasting, LLC(2)(6)(19)      |                 | Subordinated Debt (14.0%, Due 6/13)(1)(7)          |   |      | 8,000  |   |   |   | 7,076   |       |   |   | 5,465 |   |
|                             |                 | Class B Voting Units (8.0%, 86,700 units)          |   |      |   |   |   |   | 9,071   |       |   |   | — |   |
| Intran Media, LLC                | Other Media          | Senior Debt (10.7%, Due 12/11)(1)                  |   |      | 9,000  |   |   |   | 8,888   |       |   |   | 8,888 |   |
|                             |                 | Series A Preferred Units (10.0%, 86,000 units)     |   |      |   |   |   |   | 9,095   |       |   |   | 1,956 |   |
|                             |                 | Series B Preferred Units (10.0%, 30,000 units)     |   |      |   |   |   |   | 3,000   |       |   |   | 1,096 |   |
| Jet Plastica Investors,          | Plastic Products     | Subordinated Debt A (14.8%, Due 3/13)(1)           |   |      | 16,377 |   |   |   | 16,124  |       |   |   | 16,124 |   |
| LLC(2)                           |                 | Subordinated Debt B (15.0%, Due 3/13)(1)           |   |      | 17,050 |   |   |   | 17,050  |       |   |   | 13,823 |   |
|                             |                 | Preferred LLC Interest (8.0%, 301,595 units)       |   |      |   |   |   |   | 34,014  |       |   |   | — |   |
| JetBroadband Holdings,           | Cable                | Subordinated Unsecured Debt (14.8%, Due 8/15-2/16) |   |      | 26,911 |   |   |   | 25,577  |       |   |   | 25,577 |   |
| LLC(2)                           |                 | Preferred Units (10.0%, 133,204 units)             |   |      |   |   |   |   | 18,470  |       |   |   | 16,562 |   |
| LMS Intellibound                 | Logistics            | Senior Debt (7.5%, Due 8/12)(1)                    |   |      | 11,328 |   |   |   | 11,223  |       |   |   | 11,223 |   |
| Investors, LLC(2)                |                 | Subordinated Debt (15.0%, Due 11/12)(1)            |   |      | 17,000 |   |   |   | 16,882  |       |   |   | 16,882 |   |
|                             |                 | Preferred Units (12.0%, 19,650 units)              |   |      |   |   |   |   | 23,780  |       |   |   | 38,845 |   |
|                             |                 | Warrants to purchase Class B Common Stock          |   |      |   |   |   |   | — |       |   |   | — |   |
| MTP Holding, LLC(6)              | Communications-Other | Common LLC Interest (79,171 units)                 |   |      |   |   |   |   | 3       |       |   |   | 28 |   |
| National Product                 | Business             | Senior Debt A1 (5.5%, Due 6/09)                    |   |      | 4,528  |   |   |   | 3,693   |       |   |   | 3,693 |   |
| Services, Inc.(2)(5)(17)         | Services             | Senior Debt A2 and A3 (10.8%, Due 6/09)            |   |      | 9,358  |   |   |   | 6,528   |       |   |   | 5,799 |   |
|                             |                 | Subordinated Debt (16.0%, Due 6/09)(7)             |   |      | 16,010 |   |   |   | 12,305  |       |   |   | — |   |
|                             |                 | Common Stock (995,428 shares)                      |   |      |   |   |   |   | — |       |   |   | — |   |
| Orbitel Holdings, LLC(2)         | Cable                | Senior Debt (9.0%, Due 3/12)(1)                    |   |      | 16,300 |   |   |   | 16,192  |       |   |   | 16,192 |   |
|                             |                 | Preferred LLC Interest (10.0%, 120,000 units)      |   |      |   |   |   |   | 13,324  |       |   |   | 11,597 |   |
|                             |                 | Letter of Credit ($97)                             |   |      |   |   |   |   |    |       |   |   |   |   |
| PremierGarage                    | Home Furnishings     | Senior Debt (9.7%, Due 6/10-12/10)(1)              |   |      | 8,782  |   |   |   | 8,702   |       |   |   | 7,832 |   |
| Holdings, LLC(2)(5)              |                 | Preferred LLC Units (8.0%, 445 units)              |   |      |   |   |   |   | 4,971   |       |   |   | — |   |
|                             |                 | Common LLC Units (356 units)                       |   |      |   |   |   |   | — |       |   |   | — |   |
| RadioPharmacy                    | Healthcare           | Senior Debt (8.1%, Due 12/10)(1)                   |   |      | 8,500  |   |   |   | 8,469   |       |   |   | 8,469 |   |
| Investors, LLC(2)                |                 | Subordinated Debt (15.0%, Due 12/11)(1)            |   |      | 9,837  |   |   |   | 9,793   |       |   |   | 9,793 |   |
|                             |                 | Preferred LLC Interest (8.0%, 70,000 units)        |   |      |   |   |   |   | 8,123   |       |   |   | 3,479 |   |
| Superior Industries              | Sporting Goods       | Subordinated Debt (14.0%, Due 3/13)(1)             |   |      | 18,033 |   |   |   | 17,920  |       |   |   | 17,920 |   |
| Investors, LLC(2)                |                 | Preferred Units (8.0%, 125,400 units)              |   |      |   |   |   |   | 14,978  |       |   |   | 18,611 |   |

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Table of Contents

| Portfolio Company                                                                | Industry          | Investment(9)                                                              |   | Principal |   |   | Cost    |   |    | Fair Value |    |
|----------------------------------------------------------------------------------|-------------------|----------------------------------------------------------------------------|--------|-----------|--------|--------|---------|--------|---------|------------|---------|
| TNR Holdings                                                                     | Entertainment     | Senior Debt (12.0%, Due 7/13)(7)                                           |   | $         | 2,104  |   |    | $      | 1,708   |       |    | $ | 1,708 |   |
| Corp.(2)(6)(15)                                                                  |              | Series A Preferred Stock (8.0%, 43,264 shares)                             |   |      |   |   |    |   | 28,770  |       |    |   | 25,682 |   |
|                                                                             |              | Legacy Series A Preferred Stock (12.5%, 585,939 shares)                    |   |      |   |   |    |   | 15,000  |       |    |   | — |   |
|                                                                             |              | Legacy Common Stock (1,806 shares)                                         |   |      |   |   |    |   | 3,000   |       |    |   | — |   |
|                                                                             |              | Warrants to purchase Common Stock (expire 7/18)                            |   |      |   |   |    |   | — |       |    |   | — |   |
|                                                                             |              | Warrants to purchase Legacy Common Stock (expire 9/17)                     |   |      |   |   |    |   | — |       |    |   | — |   |
| Total Sleep Holdings,                                                            | Healthcare        | Subordinated Debt (15.0%, Due 9/11-3/12)                                   |   |      | 32,429 |   |    |   | 29,579  |       |    |   | 26,540 |   |
| Inc.(2)                                                                          |              | Unsecured Note (0.0%, Due 6/11)                                            |   |      | 375    |   |    |   | 327     |       |    |   | — |   |
|                                                                             |              | Series A Preferred Stock (10.0%, 3,700 shares)                             |   |      |   |   |    |   | 3,793   |       |    |   | — |   |
|                                                                             |              | Common Stock (4,046,875 shares)                                            |   |      |   |   |    |   | 1,000   |       |    |   | — |   |
| WMAC II, Inc.(6)                                                                 | Publishing        | Guaranty ($833)                                                            |   |      |   |   |    |   |    |       |    |   |   |   |
| Total Control Investments (represents 46.7% of total investments at fair value)  |              |                                                                       |   |      |   |   | 819,076 |   |    |       | 562,686 |   |
| Affiliate Investments(3):                                                        |              |                                                                       |   |      |   |   |    |   |    |       |    |   |
| Advanced Sleep                                                                   | Home Furnishings  | Senior Debt (13.9%, Due 10/11)(1)                                          |   |      | 6,195  |   |    |   | 6,023   |       |    |   | 5,629 |   |
| Concepts, Inc.(2)                                                                |              | Subordinated Debt (16.0%, Due 4/12)(1)                                     |   |      | 4,922  |   |    |   | 4,791   |       |    |   | 4,426 |   |
|                                                                             |              | Series A Preferred Stock (20.0%, 49 shares)                                |   |      |   |   |    |   | 298     |       |    |   | — |   |
|                                                                             |              | Common Stock (423 shares)                                                  |   |      |   |   |    |   | 525     |       |    |   | — |   |
|                                                                             |              | Warrants to purchase Common Stock (expire 10/16)                           |   |      |   |   |    |   | 348     |       |    |   | — |   |
| Cherry Hill Holdings, Inc.(2)(6)                                                 | Entertainment     | Series A Preferred Stock (10.0%, 750 shares)                               |   |      |   |   |    |   | 907     |       |    |   | 878 |   |
| Stratford School                                                                 | Education         | Senior Debt (6.8%, Due 7/11-9/11)(1)                                       |   |      | 3,700  |   |    |   | 3,634   |       |    |   | 3,634 |   |
| Holdings, Inc.(2)                                                                |              | Subordinated Debt (14.0%, Due 12/11)(1)                                    |   |      | 6,717  |   |    |   | 6,683   |       |    |   | 6,683 |   |
|                                                                             |              | Series A Convertible Preferred Stock (12.0%, 10,000 shares)                |   |      |   |   |    |   | 120     |       |    |   | 12,842 |   |
|                                                                             |              | Warrants to purchase Common Stock (expire 5/15)(1)                         |   |      |   |   |    |   | 67      |       |    |   | 3,903 |   |
| Sunshine Media                                                                   | Publishing        | Common Stock (145 shares)                                                  |   |      |   |   |    |   | 581     |       |    |   | — |   |
| Delaware, LLC(2)(6)                                                              |              | Class A LLC Interest (8.0%, 563,808 units)                                 |   |      |   |   |    |   | 564     |       |    |   | — |   |
|                                                                             |              | Options to acquire Warrants to purchase Class B LLC Interest (expire 5/14) |   |      |   |   |    |   | — |       |    |   | — |   |
| Velocity Technology                                                              | Business Services | Senior Debt (8.0%, Due 12/12)(1)                                           |   |      | 16,817 |   |    |   | 16,705  |       |    |   | 16,204 |   |
| Enterprises, Inc.(2)(21)                                                         |              | Series A Preferred Stock (1,506,602 shares)                                |   |      |   |   |    |   | 1,500   |       |    |   | 1,500 |   |
| XFone, Inc.(6)                                                                   | Communications-   | Common Stock (837,556 shares)                                              |   |      |   |   |    |   | 2,395   |       |    |   | 419 |   |
|                                                                             | Other             | Warrants to purchase Common Stock (expire 3/11)                            |   |      |   |   |    |   | — |       |    |   | 8 |   |
| Total Affiliate Investments (represents 4.7% of total investments at fair value) |              |                                                                       |   |      |   |   | 45,141  |   |    |       | 56,126  |   |

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Table of Contents

| Portfolio Company                               | Industry                       | Investment(9)                                                |   | Principal |   |   | Cost   |   |    | Fair Value |   |
|-------------------------------------------------|--------------------------------|--------------------------------------------------------------|--------|-----------|--------|--------|--------|--------|---------|------------|--------|
| Non-Affiliate Investments (less than 5% owned): |                           |                                                         |   |      |   |   |   |   |    |
| Active Brands                                   | Consumer Products              | Senior Debt (8.2%, Due 6/12)(1)                              |   | $         | 20,000 |   |   | $      | 19,882  |       |   | $ | 18,942 |   |
| International, lnc.(2)                          |                           | Subordinated Debt (15.0%, Due 9/12)(1)(7)                    |   |      | 13,822 |   |   |   | 13,071  |       |   |   | 3,913 |   |
|                                            |                           | Class A-1 Common Stock (3,056 shares)                        |   |      |   |   |   |   | 3,056   |       |   |   | — |   |
|                                            |                           | Warrants to purchase Class A-1 Common Stock (expire 6/17)    |   |      |   |   |   |   | 332     |       |   |   | — |   |
| Allen’s T.V. Cable                        | Cable                          | Senior Debt (8.2%, Due 12/12)(1)                             |   |      | 7,430  |   |   |   | 7,394   |       |   |   | 7,351 |   |
| Service, Inc.                                   |                           | Subordinated Debt (10.5%, Due 12/12)(1)                      |   |      | 2,349  |   |   |   | 2,288   |       |   |   | 2,214 |   |
|                                            |                           | Warrants to purchase Common Stock (expire 11/15)             |   |      |   |   |   |   | — |       |   |   | 30 |   |
| Amerifit Nutrition, Inc.(2)(20)                 | Healthcare                     | Senior Debt (11.4%, Due 3/10)(1)                             |   |      | 3,634  |   |   |   | 3,600   |       |   |   | 3,600 |   |
| B & H Education, Inc.                       | Education                      | Series A-1 Convertible Preferred Stock (12.0%, 5,384 shares) |   |      |   |   |   |   | 1,490   |       |   |   | 2,000 |   |
| BLI Holdings, Inc.(2)(22)                       | Drugs                          | Senior Debt (11.3%, Due 1/09)(1)                             |   |      | 11,333 |   |   |   | 11,234  |       |   |   | 11,234 |   |
| CEI Holdings Inc.                               | Cosmetics                      | Senior Debt (6.3%, Due 3/14)(1)                              |   |      | 3,918  |   |   |   | 3,927   |       |   |   | 1,674 |   |
| Cervalis LLC                                    | Business Services              | Senior Debt (7.3%, Due 3/12)(1)                              |   |      | 19,625 |   |   |   | 19,525  |       |   |   | 19,034 |   |
| Coastal Sunbelt Real                            | Real Estate                    | Subordinated Unsecured Debt (15.0%, Due 7/12)                |   |      | 2,124  |   |   |   | 2,111   |       |   |   | 2,111 |   |
| Estate, Inc.                                    | Investments                    | Series A-2 Preferred Stock (12.0%, 20,000 shares)            |   |      |   |   |   |   | 2,507   |       |   |   | 3,080 |   |
|                                            |                           | Warrants to purchase Class B Common Stock                    |   |      |   |   |   |   | — |       |   |   | — |   |
| Construction Trailer Specialists, Inc.(2)       | Auto Parts                     | Senior Debt (9.7%, Due 7/12-10/12)(1)                        |   |      | 8,776  |   |   |   | 8,704   |       |   |   | 8,704 |   |
| Cruz Bay Publishing, Inc.                       | Publishing                     | Subordinated Debt (10.5%, Due 12/13)(1)                      |   |      | 20,000 |   |   |   | 19,858  |       |   |   | 17,348 |   |
| CWP/RMK Acquisition                             | Home Furnishings               | Senior Debt (9.6%, Due 6/11)(1)                              |   |      | 6,005  |   |   |   | 5,971   |       |   |   | 5,104 |   |
| Corp.(2)                                        |                           | Subordinated Debt (14.1%, Due 12/12)(1)(7)                   |   |      | 11,929 |   |   |   | 10,198  |       |   |   | 3,489 |   |
|                                            |                           | Common Stock (500 shares)                                    |   |      |   |   |   |   | 500     |       |   |   | — |   |
| Cyrus Networks, LLC                             | Business Services              | Senior Debt (5.8%, Due 7/13)(1)                              |   |      | 5,441  |   |   |   | 5,408   |       |   |   | 4,915 |   |
|                                            |                           | Subordinated Debt (9.1%, Due 1/14)(1)                        |   |      | 6,066  |   |   |   | 6,057   |       |   |   | 5,110 |   |
| Dayton Parts Holdings,                          | Auto Parts                     | Subordinated Debt (6.5%, Due 6/11)(1)                        |   |      | 21,500 |   |   |   | 21,380  |       |   |   | 21,380 |   |
| LLC(2)                                          |                           | Preferred LLC Interest (10.0%, 16,470 units)                 |   |      |   |   |   |   | 589     |       |   |   | 589 |   |
|                                            |                           | Class A Common LLC Interest (8.0%, 10,980 units)             |   |      |   |   |   |   | 400     |       |   |   | 338 |   |
| Empower IT Holdings, Inc.(2)                    | Information Services           | Senior Debt (11.0%, Due 5/12)(1)                             |   |      | 8,534  |   |   |   | 8,455   |       |   |   | 8,455 |   |
| Equibrand Holding                               | Leisure Activities             | Senior Debt (11.1%, Due 9/10)(1)                             |   |      | 4,640  |   |   |   | 4,604   |       |   |   | 4,604 |   |
| Corporation(2)                                  |                           | Subordinated Debt (16.0%, Due 3/11)(1)                       |   |      | 9,248  |   |   |   | 9,212   |       |   |   | 9,212 |   |
| Flexsol Packaging Corp.(6)                      | Plastic Products               | Subordinated Debt (14.3%, Due 12/12)(1)(7)                   |   |      | 3,081  |   |   |   | 3,058   |       |   |   | 1,133 |   |
| G&L Investment                              | Insurance                      | Subordinated Debt (9.7%, Due 5/14)(1)                        |   |      | 17,500 |   |   |   | 16,912  |       |   |   | 15,164 |   |
| Holdings, LLC(2)                                |                           | Series A Preferred Shares (14.0%, 5,000,000 shares)          |   |      |   |   |   |   | 5,810   |       |   |   | 5,810 |   |
|                                            |                           | Class C Shares (621,907 shares)                              |   |      |   |   |   |   | 529     |       |   |   | 284 |   |
| Golden Knight II CLO, Ltd.                      | Diversified Financial Services | Income Notes (8.0%, Due 4/19)                                |   |      |   |   |   |   | 3,575   |       |   |   | 435 |   |
| GSDM Holdings, LLC(2)                           | Healthcare                     | Senior Debt (7.5%, Due 2/13)(1)                              |   |      | 8,775  |   |   |   | 8,682   |       |   |   | 8,355 |   |
|                                            |                           | Subordinated Debt (14.0%, Due 8/13)(1)                       |   |      | 7,809  |   |   |   | 7,767   |       |   |   | 7,767 |   |
|                                            |                           | Series B Preferred Units (12.5%, 4,213,333 units)            |   |      |   |   |   |   | 4,397   |       |   |   | 1,965 |   |
| Home Interiors & Gifts, Inc.(6)(10)         | Home Furnishings               | Senior Debt (8.0%, Due 3/11)(7)                              |   |      | 4,141  |   |   |   | 3,991   |       |   |   | 667 |   |
| Jenzabar, Inc.(23)                              | Technology                     | Senior Preferred Stock (11.0%, 5,000 shares)                 |   |      |   |   |   |   | 7,475   |       |   |   | 7,475 |   |
|                                            |                           | Subordinated Preferred Stock (109,800 shares)                |   |      |   |   |   |   | 1,098   |       |   |   | 1,098 |   |
|                                            |                           | Warrants to purchase Common Stock (expire 4/16)              |   |      |   |   |   |   | 422     |       |   |   | 27,407 |   |
| Jupitermedia Corporation(6)(13)                 | Information Services           | Common Stock (148,373 shares)                                |   |      |   |   |   |   | 2,114   |       |   |   | 56 |   |
| Legacy Cabinets, Inc.                           | Home Furnishings               | Subordinated Debt (9.8%, Due 8/13)(1)                        |   |      | 2,328  |   |   |   | 2,313   |       |   |   | 752 |   |
| Marietta Intermediate Holding Corporation(6)    | Cosmetics                      | Subordinated Debt (12.0%, Due 12/11)(1)(7)                   |   |      | 2,262  |   |   |   | 2,028   |       |   |   | — |   |
| Maverick Healthcare                             | Healthcare                     | Subordinated Debt (13.5%, Due 4/14)(1)                       |   |      | 12,596 |   |   |   | 12,493  |       |   |   | 12,494 |   |
| Equity, LLC                                     |                           | Preferred Units (10.0%, 1,250,000 units)                     |   |      |   |   |   |   | 1,403   |       |   |   | 1,403 |   |
|                                            |                           | Class A Common Units (1,250,000 units)                       |   |      |   |   |   |   | — |       |   |   | 138 |   |
| MCI Holdings LLC(2)                             | Healthcare                     | Subordinated Debt (12.7%, Due 4/13)(1)                       |   |      | 31,446 |   |   |   | 31,280  |       |   |   | 31,280 |   |
|                                            |                           | Class A LLC Interest (4,712,042 units)                       |   |      |   |   |   |   | 3,000   |       |   |   | 8,305 |   |

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Table of Contents

| Portfolio Company                                                                     | Industry             | Investment(9)                                                       |   | Principal |   |   | Cost    |   |      | Fair Value |    |
|---------------------------------------------------------------------------------------|----------------------|---------------------------------------------------------------------|--------|-----------|--------|--------|---------|--------|-----------|------------|---------|
| Metropolitan                                                                          | Communications-      | Senior Debt (10.8%, Due 6/10-9/10) (1)                              |   | $         | 23,769 |   |    | $      | 23,530    |       |    | $ | 23,530 |   |
| Telecommunications Holding Company(2)                                                 | CLEC                 | Warrants to purchase Common Stock (expire 9/13)                     |   |      |   |   |    |   | 1,843     |       |    |   | 9,655 |   |
| Miles Media Group, LLC(2)                                                             | Publishing           | Senior Debt (12.5%, Due 6/13) (1)                                   |   |      | 18,274 |   |    |   | 17,913    |       |    |   | 17,395 |   |
| NDSSI Holdings, LLC(2)                                                                | Electronics          | Senior Debt (9.9%, Due 9/13-3/14)(1)                                |   |      | 19,921 |   |    |   | 19,697    |       |    |   | 19,189 |   |
|                                                                                  |                 | Subordinated Debt (15.0%, Due 9/14)(1)                              |   |      | 21,284 |   |    |   | 21,211    |       |    |   | 21,211 |   |
|                                                                                  |                 | Series A Preferred Units (516,691 units)                            |   |      |   |   |    |   | 718       |       |    |   | 718 |   |
|                                                                                  |                 | Class A Common Units (1,000,000 units)                              |   |      |   |   |    |   | 333       |       |    |   | 900 |   |
| New Century Companies, Inc.(6)                                                        | Industrial Equipment | Warrants to purchase Common Stock (expire 6/10)                     |   |      |   |   |    |   | —   |       |    |   | — |   |
| New England Precision                                                                 | Industrial Products  | Senior Debt (11.1%, Due 10/13)(1)                                   |   |      | 25,685 |   |    |   | 25,464    |       |    |   | 25,033 |   |
| Grinding Holdings, LLC(11)                                                            |                 | Common Units (1,000,000 units)                                      |   |      |   |   |    |   | 1,000     |       |    |   | 1,213 |   |
| PartMiner, Inc.(2)                                                                    | Information Services | Senior Debt (8.7%, Due 6/09)(1)                                     |   |      | 854    |   |    |   | 846       |       |    |   | 846 |   |
| Philadelphia Newspapers, LLC(6)(12)                                                   | Newspaper            | Subordinated Unsecured Debt (16.5%, Due 6/14)(7)                    |   |      | 5,082  |   |    |   | 5,070     |       |    |   | — |   |
| Powercom Corporation(14)                                                              | Communications-      | Senior Debt (11.5%, Due 6/11)                                       |   |      | 1,357  |   |    |   | 1,357     |       |    |   | 1,279 |   |
|                                                                                  | CLEC                 | Warrants to purchase Class A Common Stock (expire 6/14)             |   |      |   |   |    |   | 286       |       |    |   | — |   |
| Quantum Medical                                                                       | Laboratory           | Senior Debt (7.5%, Due 5/11)(1)                                     |   |      | 15,500 |   |    |   | 15,438    |       |    |   | 15,438 |   |
| Holdings, LLC (2)                                                                     | Instruments          | Subordinated Debt (15.0%, Due 12/11)(1)                             |   |      | 18,032 |   |    |   | 17,911    |       |    |   | 17,911 |   |
|                                                                                  |                 | Preferred LLC Interest (1,000,000 units)                            |   |      |   |   |    |   | 557       |       |    |   | 1,704 |   |
| Restaurant Technologies,                                                              | Food Services        | Senior Debt (16.6%, Due 2/12)(1)                                    |   |      | 37,197 |   |    |   | 36,929    |       |    |   | 36,929 |   |
| Inc.                                                                                  |                 | Series B Preferred Stock (499 shares)                               |   |      |   |   |    |   | 15        |       |    |   | 19 |   |
|                                                                                  |                 | Series A-4 Convertible Preferred Stock (7,813 shares)               |   |      |   |   |    |   | 336       |       |    |   | 97 |   |
| Sagamore Hill Broadcasting, LLC(2)                                                    | Broadcasting         | Senior Debt (11.5%, Due 8/12)(1)                                    |   |      | 25,800 |   |    |   | 25,664    |       |    |   | 24,793 |   |
| Summit Business Media Intermediate Holding Company, LLC                               | Information Services | Subordinated Debt (7.5%, Due 7/14)(1)                               |   |      | 6,000  |   |    |   | 5,995     |       |    |   | 4,261 |   |
| Teleguam Holdings, LLC(2)                                                             | Communications-Other | Subordinated Debt (9.2%, Due 10/12)(1)                              |   |      | 20,000 |   |    |   | 19,831    |       |    |   | 16,920 |   |
| The e-Media Club I, LLC(6)                                                            | Investment Fund      | LLC Interest (74 units)                                             |   |      |   |   |    |   | 88        |       |    |   | 9 |   |
| The Matrixx Group, Incorporated                                                       | Plastic Products     | Subordinated Debt (15.5%, Due 11/14)(1)                             |   |      | 14,238 |   |    |   | 14,238    |       |    |   | 14,238 |   |
| ValuePage, Inc.(6)                                                                    | Communications-Other | Senior Debt (12.8%, Due 6/08) (7)                                   |   |      | 1,230  |   |    |   | 998       |       |    |   | 28 |   |
| VOX Communications                                                                    | Broadcasting         | Senior Debt (13.5%, Due 3/09)(1)                                    |   |      | 11,312 |   |    |   | 10,725    |       |    |   | 10,674 |   |
| Group Holdings, LLC(2)                                                                |                 | Convertible Preferred Subordinated Notes (12.5%, Due 6/15-6/17) (7) |   |      | 1,856  |   |    |   | 1,415     |       |    |   | 393 |   |
| VS&A-PBI Holding LLC(6)                                                           | Publishing           | LLC Interest                                                        |   |      |   |   |    |   | 500       |       |    |   | — |   |
| Wireco Worldgroup Inc.                                                                | Industrial Equipment | Senior Debt (3.7%, Due 2/14)(1)                                     |   |      | 3,930  |   |    |   | 3,951     |       |    |   | 2,576 |   |
| Xpressdocs Holdings,                                                                  | Business Services    | Senior Debt (8.9%, Due 7/11-12/11)(1)                               |   |      | 15,168 |   |    |   | 15,091    |       |    |   | 14,550 |   |
| Inc.(2)                                                                               |                 | Subordinated Debt (16.0%, Due 7/12)(1)                              |   |      | 6,390  |   |    |   | 6,355     |       |    |   | 6,238 |   |
|                                                                                  |                 | Series A Preferred Stock (161,870 shares)                           |   |      |   |   |    |   | 501       |       |    |   | 170 |   |
| Total Non-Affiliate Investments (represents 48.6% of total investments at fair value) |                 |                                                                |   |      |   |   | 605,906 |   |      |       | 584,336 |   |
| Total Investments                                                                     |                 |                                                                |   |      |   |   |    | $      | 1,470,123 |       |    | $ | 1,203,148 |   |

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Table of Contents

| Counterparty              | Instrument                                          |   | Interest Rate |   |   | Expiring |   |   | Notional |   |   | Cost   |   |   | Fair Value |   |
|---------------------------|-----------------------------------------------------|--------|---------------|--------|--------|----------|--------|--------|----------|--------|--------|--------|--------|--------|------------|--------|
| Interest Rate Swaps       |                                                |   |          |   |   |     |   |   |     |   |   |   |   |   |       |   |
| SunTrust Bank             | Interest Rate Swap—Pay Fixed/Receive Floating |   |          | 10.0   | %      |     | 11/10  |   |     | $      | 16,000 |   |   | $      | —    |   |   | $ | (649 | ) |
|                      | Interest Rate Swap—Pay Fixed/Receive Floating |   |          | 14.0   | %      |     | 11/10  |   |     |   | 8,000  |   |   |   | —    |   |   |   | (324 | ) |
| Total Interest Rate Swaps |                                                |   |          |   |   |     |   |   |     | $      | 24,000 |   |   | $      | —    |   |   | $ | (973 | ) |

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| (1) | Some or all of this security is funded through our SBIC subsidiary or one of our other financing subsidiaries and may have been pledged as collateral in connection therewith.  See Note 6—Borrowings to the Consolidated Financial Statements. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | Includes securities issued by one or more of the portfolio company’s affiliates. |
|-----|----------------------------------------------------------------------------------------|

| (3) | Affiliate investments represent companies in which we own at least 5%, but not more than 25% of the portfolio company’s voting securities. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------|

| (4) | Control investments represent companies in which we own more than 25% of the portfolio company’s voting securities. |
|-----|---------------------------------------------------------------------------------------------------------------------------|

| (5) | Represents a non-majority-owned control portfolio company of which we own at least 25%, but not more than 50% of the portfolio company’s voting securities. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (6) | Portfolio company is non-income producing at period-end. |
|-----|----------------------------------------------------------|

| (7) | Loan or debt security is on non-accrual status. |
|-----|-------------------------------------------------|

| (8) | During the quarter ended December 31, 2009, we did not recognize paid-in-kind interest or accretion income because the fair value of our investment was below its cost basis.  However, we continue to accrue interest that is receivable in cash from the portfolio company. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (9) | Interest rates represent the weighted-average annual stated interest rate on loans and debt securities, presented by nature of indebtedness for a single issuer.  The maturity dates represent the earliest and the latest maturity dates.  Rates on preferred stock and preferred LLC interests, where applicable, represent the contractual rate. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (10) | On April 29, 2008, Home Interiors & Gifts, Inc. filed for Chapter 11 bankruptcy protection. |
|------|-------------------------------------------------------------------------------------------------|

| (11) | On January 14, 2009, New England Precision Grinding Holdings, LLC changed its name to Tegra Medical Holdings, LLC. |
|------|--------------------------------------------------------------------------------------------------------------------|

| (12) | On February 22, 2009, Philadelphia Newspapers, LLC filed for Chapter 11 bankruptcy protection. |
|------|------------------------------------------------------------------------------------------------|

| (13) | On February 24, 2009, Jupitermedia Corporation changed its name to WebMediaBrands Inc. |
|------|----------------------------------------------------------------------------------------|

| (14) | On February 28, 2009, this obligation and all of the assets of Powercom Corporation (other than its accounts receivable), were transferred to Lambeau Telecom Company, LLC, an affiliate of BCN Telecom, Inc., or BCN, in satisfaction of certain subordinated liabilities of Powercom Corporation owed to BCN. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (15) | On July 28, 2008, we converted our debt securities in TNR Entertainment Corp. into preferred stock of TNR Holdings Corp. and invested $2.0 million in debt in TNR Holdings Corp.  The amounts reported herein for December 31, 2008 as Legacy Series A Preferred Stock, Legacy Common Stock and Warrants to purchase Legacy Common Stock, relate to our equity investment in TNR Entertainment Corp.  On April 20, 2009, TNR Holdings Corp. repaid in full its debt together with all accrued interest and we concurrently sold our equity in TNR Holdings Corp. for an aggregate between the two transactions of $11.6 million in cash.  On August 17, 2009, we dissolved TNR Entertainment Corp. |
|------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (16) | On August 25, 2009, Birch Communications, Inc. acquired substantially all of the operating assets of Cleartel Communications, Inc., or Cleartel, an MCG control investment.  The cash portion of the purchase price was used primarily to pay off third-party senior debt under Cleartel’s senior credit facility with Textron Financial Corporation and its equipment leasing facility with Relational, LLC.  On the closing date of the sale, Cleartel entered into a Transition Services Agreement, or TSA with Birch to provide certain services necessary to effect an orderly transition of the business from Cleartel to Birch.  On December 15, 2009, we transferred all of the remaining assets of Cleartel to a liquidating trust and realized a loss on our investment and reversed an offsetting unrealized loss that we had recognized in previous periods. |
|------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (17) | On July 22, 2009, we recapitalized our investment in National Product Services, Inc. through a series of related debt and equity transactions.  MCG’s new investment is in NPS Holdings Group, LLC. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (18) | On August 13, 2009, we sold our equity investment in Coastal Sunbelt Holdings, Inc., or Coastal, a subsidiary of Coastal Sunbelt, LLC, for $15.2 million to Coastal’s management team and MSouth Equity Partners, LP, which resulted in the reclassification of our investment in Coastal from a control investment to a non-affiliate investment beginning in the quarter ended September 30, 2009. |
|------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (19) | On October 26, 2009, we completed an asset exchange transaction between HITV Operating Co., Inc., a subsidiary of GMC Television Broadcasting, LLC, and KHNL/KFVE, LLC, a wholly owned subsidiary of Raycom Media Inc.  Pursuant to an asset exchange agreement, dated October 16, 2009, HITV exchanged with KHNL/KFVE, LLC certain assets that were used in the operation of HITV’s Television Station KGMB in Honolulu, Hawaii in return for a $22.0 million note, with current pay interest, and certain of the programming assets that were used in the operation of KHNL/KFVE, LLC’s Television Station KFVE-TV in Honolulu. |
|------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (20) | On February 12, 2010, Amerifit Nutrition, Inc. senior debt was repaid in full. |
|------|--------------------------------------------------------------------------------|

| (21) | On February 19, 2010, Velocity Technology Enterprises, Inc. senior debt was repaid in full. |
|------|---------------------------------------------------------------------------------------------|

| (22) | On February 24, 2010, BLI Holdings, Inc. senior debt was repaid in full. |
|------|--------------------------------------------------------------------------|

| (23) | On February 24, 2010, we exercised 100,000 of our Warrants in Jenzabar, Inc. for an aggregate exercise price of $1,000. |
|------|-------------------------------------------------------------------------------------------------------------------------|

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Table of Contents

|   | · | Interest Income—We accrue interest income if we expect that ultimately we will be able to collect it.  Generally, when a loan becomes more than 90 days past due, or if we otherwise believe the customer is unable to service its debt and other obligations, we will place the loan on non-accrual status and will cease recognizing interest income on that loan until all principal and interest is current through payment or due to a restructuring such that the interest income is deemed to be collectible.  However, we remain contractually entitled to this interest.  We may make exceptions to this policy if the loan has sufficient collateral value and is in the process of collection. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Dividend Income—We accrue dividend income on equity investments with stated income, if we expect to collect the dividends.  We record dividend income on common equity investments when the dividend has been declared and is required to be paid. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Loan Origination Fees—We capitalize loan origination fees, then amortize these fees into interest income over the term of the loan using the effective interest rate method.  In certain loan arrangements, we receive warrants or other equity interests from the borrower as additional origination fees.  Typically, borrowers granting these interests are not traded publicly.  We record the financial instruments received at fair value as determined in good faith by our board of directors.  In certain cases, when we record a warrant or other equity instrument that results in a loan discount, we accrete the discount into income over the term of the loan. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Advisory Fees and Other Income—We charge our portfolio companies fees for services that we provide, including advisory and management services, equity structuring, prepayments, research, bank interest and other fees.  These fees are based on market rates, which are documented in an agreement between MCG and the respective portfolio companies.  We recognize advisory and management services fees when earned.  We also recognize equity structuring fees as earned, which generally occurs when the investment transaction closes.  Finally, we recognize prepayment fees upon receipt. |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Control Investments—Investments in which we control more than 25% of the voting securities or have greater than 50% representation on the board of directors; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Affiliate Investments—Investments in which we own between 5% and 25% of the voting securities and have less than 50% representation on the board of directors; and |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Non-Affiliate Investments—Investments in which we own less than 5% of the voting securities. |
|--------|--------|----------------------------------------------------------------------------------------------------|

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|   | · | Cash and cash equivalents—Represents unrestricted cash, including checking accounts, interest bearing deposits collateralized by marketable debt securities and highly liquid investments with original maturities of 90 days or less; |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Cash, securitization accounts—Represents principal and interest held in designated bank accounts that we received on securitized loans or other reserved amounts associated with our securitization facilities.  We must use the funds deposited in these accounts to pay interest, reduce borrowings or pay other specified obligations in accordance with associated securitization agreements.  Interest collections in excess of the interest payments and other specified obligations are distributed back to us; and |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | Cash, restricted—Includes cash held in escrow that we received as part of an asset sale, cash held for regulatory purposes and cash that we have received that is earmarked for transfer into our cash, securitization accounts. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | · | In February 2008, FASB issued FASB Staff Position No. FAS 157-2—Effective Date of FASB No. 157, which deferred the date for which ASC 820 was required to be adopted for nonfinancial assets and nonfinancial liabilities to fiscal years beginning after November 15, 2008, with early adoption permitted in certain cases.  Our adoption of this standard as of January 1, 2009 did not affect our financial position or results of operations. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | In October 2008, FASB issued FASB Staff Position No. FAS 157-3—Determining the Fair Value of a Financial Asset When the Market for That Asset is Not Active, which provided an illustrative example of how to determine the fair value of a financial asset in an inactive market.  This standard did not change the fair value measurement principles previously set forth by FASB.  We adopted this modification in January 2009.  Our practice for determining the fair value of our investment portfolio has been, and continues to be, consistent with the guidance provided in the example included in the October 2008 guidance.  Therefore, our adoption of this standard did not affect our practices for determining the fair value of our investment portfolio and did not have a material effect on our financial position or results of operations. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | In April 2009, FASB issued FASB Staff Position No. FAS 157-4—Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Indentifying Transactions That Are Not Orderly, which established standards for determining whether normal market activity exists for Level 2 assets and liabilities.  In addition, the standard expands disclosure requirements for fair value reporting and requires a categorization of investments consistent with that required for ASC 320—Investments—Debt and Equity Securities.  We adopted this standard for the period ended June 30, 2009.  Since our Level 2 investments comprise less than 0.5% of our investment portfolio, our adoption of this standard, did not have a material effect on our financial position or results of operations. |
|--------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                             |   | December 31, 2009 |      |   | December 31, 2008     |   |
|----------------------------------|--------|------------------------|-----------|--------|----------------------------|--------|
| (dollars in thousands)           |   | Investments at Cost    |      |   | Percent of Total Portfolio |   |   | Investments at Cost |   |   | Percent of Total Portfolio |   |
| Debt investments                 |   |                   |      |   |                       |   |   |   |   |   |   |   |
| Senior secured debt              |   | $                      | 406,182   |   |                       |   | 35.2 | % |   | $ | 445,392 |   |   |   | 30.3 | % |
| Subordinated debt                |   |                   |      |   |                       |   |   |   |   |   |   |   |   |   |   |   |
| Secured                          |   |                   | 323,575   |   |                       |   | 28.0 |   |   |   | 439,440 |   |   |   | 29.9 |   |
| Unsecured                        |   |                   | 38,436    |   |                       |   | 3.3 |   |   |   | 34,500 |   |   |   | 2.3 |   |
| Total debt investments           |   |                   | 768,193   |   |                       |   | 66.5 |   |   |   | 919,332 |   |   |   | 62.5 |   |
| Equity investments               |   |                   |      |   |                       |   |   |   |   |   |   |   |   |   |   |   |
| Preferred equity                 |   |                   | 365,418   |   |                       |   | 31.6 |   |   |   | 463,333 |   |   |   | 31.5 |   |
| Common/common equivalents equity |   |                   | 21,313    |   |                       |   | 1.9 |   |   |   | 87,458 |   |   |   | 6.0 |   |
| Total equity investments         |   |                   | 386,731   |   |                       |   | 33.5 |   |   |   | 550,791 |   |   |   | 37.5 |   |
| Total investments                |   | $                      | 1,154,924 |   |                       |   | 100.0 | % |   | $ | 1,470,123 |   |   |   | 100.0 | % |

|                             |   | December 31, 2009    |    |   | December 31, 2008     |   |
|----------------------------------|--------|---------------------------|---------|--------|----------------------------|--------|
| (dollars in thousands)           |   | Investments at Fair Value |    |   | Percent of Total Portfolio |   |   | Investments at Fair Value |   |   | Percent of Total Portfolio |   |
| Debt investments                 |   |                      |    |   |                       |   |   |   |   |   |   |   |
| Senior secured debt              |   | $                         | 379,457 |   |                       |   | 38.5 | % |   | $ | 428,817 |   |   |   | 35.7 | % |
| Subordinated debt                |   |                      |    |   |                       |   |   |   |   |   |   |   |   |   |   |   |
| Secured                          |   |                      | 275,398 |   |                       |   | 27.9 |   |   |   | 351,425 |   |   |   | 29.2 |   |
| Unsecured                        |   |                      | 30,618  |   |                       |   | 3.1 |   |   |   | 28,081 |   |   |   | 2.3 |   |
| Total debt investments           |   |                      | 685,473 |   |                       |   | 69.5 |   |   |   | 808,323 |   |   |   | 67.2 |   |
| Equity investments               |   |                      |    |   |                       |   |   |   |   |   |   |   |   |   |   |   |
| Preferred equity                 |   |                      | 257,984 |   |                       |   | 26.2 |   |   |   | 339,576 |   |   |   | 28.2 |   |
| Common/common equivalents equity |   |                      | 42,889  |   |                       |   | 4.3 |   |   |   | 55,249 |   |   |   | 4.6 |   |
| Total equity investments         |   |                      | 300,873 |   |                       |   | 30.5 |   |   |   | 394,825 |   |   |   | 32.8 |   |
| Total investments                |   | $                         | 986,346 |   |                       |   | 100.0 | % |   | $ | 1,203,148 |   |   |   | 100.0 | % |

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|                                      |   | December 31, 2009 |    |   | December 31, 2008 |   |
|-------------------------------------------|--------|------------------------|---------|--------|------------------------|--------|
| (dollars in thousands)                    |   | Investments at Cost    |    |   | % of Loan Portfolio    |   |   | Investments at Cost |   |   | % of Loan Portfolio |   |
| Loans greater than 90 days past due       |   |                   |    |   |                   |   |   |   |   |   |   |   |
| On non-accrual status                     |   | $                      | 22,377  |   |                   |   | 2.91 | % |   | $ | 10,060 |   |   |   | 1.10 | % |
| Not on non-accrual status                 |   |                   | — |   |                   |   | — |   |   |   | — |   |   |   | — |   |
| Total loans greater than 90 days past due |   | $                      | 22,377  |   |                   |   | 2.91 | % |   | $ | 10,060 |   |   |   | 1.10 | % |
| Loans on non-accrual status               |   |                   |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| 0 to 90 days past due                     |   | $                      | 60,629  |   |                   |   | 7.89 | % |   | $ | 109,424 |   |   |   | 11.90 | % |
| Greater than 90 days past due             |   |                   | 22,377  |   |                   |   | 2.91 |   |   |   | 10,060 |   |   |   | 1.10 |   |
| Total loans on non-accrual status         |   | $                      | 83,006  |   |                   |   | 10.80 | % |   | $ | 119,484 |   |   |   | 13.00 | % |

|                                      |   | December 31, 2009    |    |   | December 31, 2008 |   |
|-------------------------------------------|--------|---------------------------|---------|--------|------------------------|--------|
| (dollars in thousands)                    |   | Investments at Fair Value |    |   | % of Loan Portfolio    |   |   | Investments at Fair Value |   |   | % of Loan Portfolio |   |
| Loans greater than 90 days past due       |   |                      |    |   |                   |   |   |   |   |   |   |   |
| On non-accrual status                     |   | $                         | 6,049   |   |                   |   | 0.88 | % |   | $ | 695 |   |   |   | 0.09 | % |
| Not on non-accrual status                 |   |                      | — |   |                   |   | — |   |   |   | — |   |   |   | — |   |
| Total loans greater than 90 days past due |   | $                         | 6,049   |   |                   |   | 0.88 | % |   | $ | 695 |   |   |   | 0.09 | % |
| Loans on non-accrual status               |   |                      |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| 0 to 90 days past due                     |   | $                         | 19,575  |   |                   |   | 2.86 | % |   | $ | 38,619 |   |   |   | 4.77 | % |
| Greater than 90 days past due             |   |                      | 6,049   |   |                   |   | 0.88 |   |   |   | 695 |   |   |   | 0.09 |   |
| Total loans on non-accrual status         |   | $                         | 25,624  |   |                   |   | 3.74 | % |   | $ | 39,314 |   |   |   | 4.86 | % |

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|                                                                |   | December 31, 2009 |      |   | December 31, 2008     |   |
|---------------------------------------------------------------------|--------|------------------------|-----------|--------|----------------------------|--------|
| (dollars in thousands)                                              |   | Investments at Cost    |      |   | Percent of Total Portfolio |   |   | Investments at Cost |   |   | Percent of Total Portfolio |   |
| Telecommunications—CLEC (competitive local exchange carriers) |   | $                      | 183,208   |   |                       |   | 15.9 | % |   | $ | 335,279 |   |   |   | 22.8 | % |
| Communications—other                                          |   |                   | 20,872    |   |                       |   | 1.8 |   |   |   | 23,227 |   |   |   | 1.6 |   |
| Cable                                                               |   |                   | 126,059   |   |                       |   | 10.9 |   |   |   | 115,824 |   |   |   | 7.9 |   |
| Healthcare                                                          |   |                   | 136,645   |   |                       |   | 11.8 |   |   |   | 133,706 |   |   |   | 9.1 |   |
| Food services                                                       |   |                   | 70,187    |   |                       |   | 6.1 |   |   |   | 82,119 |   |   |   | 5.6 |   |
| Plastic products                                                    |   |                   | 97,197    |   |                       |   | 8.4 |   |   |   | 84,484 |   |   |   | 5.7 |   |
| Broadcasting                                                        |   |                   | 76,223    |   |                       |   | 6.6 |   |   |   | 78,918 |   |   |   | 5.4 |   |
| Electronics                                                         |   |                   | 42,583    |   |                       |   | 3.7 |   |   |   | 41,959 |   |   |   | 2.9 |   |
| Sporting goods                                                      |   |                   | 35,398    |   |                       |   | 3.1 |   |   |   | 32,898 |   |   |   | 2.2 |   |
| Business services                                                   |   |                   | 57,112    |   |                       |   | 4.9 |   |   |   | 93,668 |   |   |   | 6.4 |   |
| Laboratory instruments                                              |   |                   | 34,073    |   |                       |   | 3.0 |   |   |   | 33,906 |   |   |   | 2.3 |   |
| Logistics                                                           |   |                   | 31,694    |   |                       |   | 2.7 |   |   |   | 51,885 |   |   |   | 3.5 |   |
| Publishing                                                          |   |                   | 38,545    |   |                       |   | 3.3 |   |   |   | 39,416 |   |   |   | 2.7 |   |
| Technology                                                          |   |                   | 7,539     |   |                       |   | 0.7 |   |   |   | 8,995 |   |   |   | 0.6 |   |
| Education                                                           |   |                   | 12,075    |   |                       |   | 1.0 |   |   |   | 11,994 |   |   |   | 0.8 |   |
| Insurance                                                           |   |                   | 24,217    |   |                       |   | 2.1 |   |   |   | 23,251 |   |   |   | 1.6 |   |
| Home furnishings                                                    |   |                   | 33,061    |   |                       |   | 2.9 |   |   |   | 48,631 |   |   |   | 3.3 |   |
| Consumer products                                                   |   |                   | 39,979    |   |                       |   | 3.5 |   |   |   | 36,341 |   |   |   | 2.5 |   |
| Leisure activities                                                  |   |                   | 14,186    |   |                       |   | 1.2 |   |   |   | 13,816 |   |   |   | 0.9 |   |
| Other media                                                         |   |                   | 21,021    |   |                       |   | 1.8 |   |   |   | 20,983 |   |   |   | 1.4 |   |
| Drugs                                                               |   |                   | 10,216    |   |                       |   | 0.9 |   |   |   | 11,234 |   |   |   | 0.8 |   |
| Auto parts                                                          |   |                   | 10,381    |   |                       |   | 0.9 |   |   |   | 31,073 |   |   |   | 2.1 |   |
| Information services                                                |   |                   | 14,069    |   |                       |   | 1.2 |   |   |   | 17,410 |   |   |   | 1.2 |   |
| Entertainment                                                       |   |                   | 907       |   |                       |   | 0.1 |   |   |   | 49,385 |   |   |   | 3.4 |   |
| Industrial products                                                 |   |                   | —   |   |                       |   | — |   |   |   | 26,464 |   |   |   | 1.8 |   |
| Other(a)                                                            |   |                   | 17,477    |   |                       |   | 1.5 |   |   |   | 23,257 |   |   |   | 1.5 |   |
| Total                                                               |   | $                      | 1,154,924 |   |                       |   | 100.0 | % |   | $ | 1,470,123 |   |   |   | 100.0 | % |

----

| (a) | No individual industry within this category exceeds 1%. |
|-----|---------------------------------------------------------|

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|                          |   | December 31, 2009    |    |   | December 31, 2008          |   |
|-------------------------------|--------|---------------------------|---------|--------|---------------------------------|--------|
| (dollars in thousands)        |   | Investments at Fair Value |    |   | Percent of Total Portfolio |   |   | Investments at Fair Value |   |   | Percent of Total Portfolio |   |
| Telecommunications—CLEC |   | $                         | 170,129 |   |                            |   | 17.2 | % |   | $ | 173,789 |   |   |   | 14.4 | % |
| Communications—other    |   |                      | 18,020  |   |                            |   | 1.8 |   |   |   | 17,403 |   |   |   | 1.5 |   |
| Cable                         |   |                      | 128,386 |   |                            |   | 13.0 |   |   |   | 119,134 |   |   |   | 9.9 |   |
| Healthcare                    |   |                      | 100,278 |   |                            |   | 10.2 |   |   |   | 123,589 |   |   |   | 10.3 |   |
| Food services                 |   |                      | 70,035  |   |                            |   | 7.1 |   |   |   | 81,935 |   |   |   | 6.8 |   |
| Plastic products              |   |                      | 57,449  |   |                            |   | 5.8 |   |   |   | 45,317 |   |   |   | 3.8 |   |
| Broadcasting                  |   |                      | 52,255  |   |                            |   | 5.3 |   |   |   | 66,401 |   |   |   | 5.5 |   |
| Electronics                   |   |                      | 42,082  |   |                            |   | 4.3 |   |   |   | 42,018 |   |   |   | 3.5 |   |
| Sporting goods                |   |                      | 39,103  |   |                            |   | 4.0 |   |   |   | 36,531 |   |   |   | 3.0 |   |
| Business services             |   |                      | 37,455  |   |                            |   | 3.8 |   |   |   | 77,213 |   |   |   | 6.4 |   |
| Laboratory instruments        |   |                      | 34,790  |   |                            |   | 3.5 |   |   |   | 35,054 |   |   |   | 2.9 |   |
| Logistics                     |   |                      | 31,694  |   |                            |   | 3.2 |   |   |   | 66,950 |   |   |   | 5.6 |   |
| Publishing                    |   |                      | 31,093  |   |                            |   | 3.2 |   |   |   | 34,743 |   |   |   | 2.9 |   |
| Technology                    |   |                      | 27,595  |   |                            |   | 2.8 |   |   |   | 35,980 |   |   |   | 3.0 |   |
| Education                     |   |                      | 24,127  |   |                            |   | 2.5 |   |   |   | 29,062 |   |   |   | 2.4 |   |
| Insurance                     |   |                      | 22,815  |   |                            |   | 2.3 |   |   |   | 21,258 |   |   |   | 1.8 |   |
| Home furnishings              |   |                      | 21,050  |   |                            |   | 2.1 |   |   |   | 27,899 |   |   |   | 2.3 |   |
| Consumer products             |   |                      | 18,665  |   |                            |   | 1.9 |   |   |   | 22,855 |   |   |   | 1.9 |   |
| Leisure activities            |   |                      | 14,186  |   |                            |   | 1.4 |   |   |   | 13,816 |   |   |   | 1.2 |   |
| Other media                   |   |                      | 10,415  |   |                            |   | 1.1 |   |   |   | 11,940 |   |   |   | 1.0 |   |
| Drugs                         |   |                      | 10,213  |   |                            |   | 1.0 |   |   |   | 11,234 |   |   |   | 0.9 |   |
| Auto parts                    |   |                      | 8,720   |   |                            |   | 0.9 |   |   |   | 31,011 |   |   |   | 2.6 |   |
| Information services          |   |                      | 6,985   |   |                            |   | 0.7 |   |   |   | 13,618 |   |   |   | 1.1 |   |
| Entertainment                 |   |                      | 906     |   |                            |   | 0.1 |   |   |   | 28,268 |   |   |   | 2.4 |   |
| Industrial products           |   |                      | — |   |                            |   | — |   |   |   | 26,246 |   |   |   | 2.2 |   |
| Other(a)                      |   |                      | 7,900   |   |                            |   | 0.8 |   |   |   | 9,884 |   |   |   | 0.7 |   |
| Total                         |   | $                         | 986,346 |   |                            |   | 100.0 | % |   | $ | 1,203,148 |   |   |   | 100.0 | % |

----

| (a) | No individual industry within this category exceeds 1%. |
|-----|---------------------------------------------------------|

| (dollars in thousands) |   |     |     |   |   | As of December 31, 2009 |   |     | Year ended December 31, 2009 |   |
|------------------------|--------|----------|----------|--------|--------|-------------------------|--------|----------|-----------------------------------|--------|
| Date                   |   |     | Interest |   |   |                    |   |     |                              |   |   | Fair |   |   | Unrealized Appreciation |   |
| Entered                |   | Expiring |     |   | Rate   |                    |   | Notional |                              |   | Cost |   |   | Value |   |   | (Depreciation) |   |
| 07/08                  |   | 11/10    |     |   |   | 10.0                    | %      |     | $                                 | 16,000 |   |   | $ | — |   |   | $ | (426 | ) |   | $ | 223 |   |
| 07/08                  |   | 11/10    |     |   |   | 14.0                    | %      |     |                              | 8,000  |   |   |   | — |   |   |   | (213 | ) |   |   | 111 |   |
| 03/09                  |   | 08/11    |     |   |   | 13.0                    | %      |     |                              | 12,500 |   |   |   | — |   |   |   | (245 | ) |   |   | (245 | ) |
| 03/09                  |   | 08/11    |     |   |   | 9.0                     | %      |     |                              | 8,681  |   |   |   | — |   |   |   | (170 | ) |   |   | (170 | ) |
| Total                  |   |     |     |   |   |                    |   |     | $                                 | 45,181 |   |   | $ | — |   |   | $ | (1,054 | ) |   | $ | (81 | ) |

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| ASC 820              |                                                                                                                                                                                                                                                                                                                                                                                                                  |
|----------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Fair Value Hierarchy | Inputs to Fair Value Methodology                                                                                                                                                                                                                                                                                                                                                                                      |
| Level 1              | Quoted prices in active markets for identical assets or liabilities                                                                                                                                                                                                                                                                                                                                                   |
|                 |                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Level 2              | Quoted prices for similar assets or liabilities; quoted markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the financial instrument; inputs other than quoted prices that are observable for the asset or liability; or inputs that are derived principally from, or corroborated by, observable market information |
|                 |                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Level 3              | Pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption is unobservable or when the estimation of fair value requires significant management judgment                                                                                                                                                                                                  |

|                            |   | As of December 31, 2009           |    |
|---------------------------------|--------|----------------------------------------|---------|
|                            |   | Quoted Market Prices in Active Markets |    |   | Internal Models with Significant Observable Market Parameters |   |   | Internal Models with Significant Unobservable Market Parameters |   |   | Total Fair Value Reported in Consolidated |   |
| (in thousands)                  |   | (Level 1)                              |    |   | (Level 2) |   |   | (Level 3) |   |   | Balance Sheet |   |
| Assets                          |   |                                   |    |   |   |   |   |   |   |   |   |   |
| Non-affiliate investments       |   |                                   |    |   |   |   |   |   |   |   |   |   |
| Senior secured debt             |   | $                                      | — |   |   | $ | 3,353 |   |   | $ | 273,319 |   |   | $ | 276,672 |   |
| Subordinated secured debt       |   |                                   | — |   |   |   | — |   |   |   | 183,684 |   |   |   | 183,684 |   |
| Unsecured subordinated debt     |   |                                   | — |   |   |   | — |   |   |   | 2,179 |   |   |   | 2,179 |   |
| Preferred equity                |   |                                   | — |   |   |   | 1,836 |   |   |   | 26,587 |   |   |   | 28,423 |   |
| Common/common equivalents       |   |                                   | 131     |   |   |   | — |   |   |   | 40,885 |   |   |   | 41,016 |   |
| Total non-affiliate investments |   |                                   | 131     |   |   |   | 5,189 |   |   |   | 526,654 |   |   |   | 531,974 |   |
| Affiliate investments           |   |                                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Senior secured debt             |   |                                   | — |   |   |   | — |   |   |   | 21,789 |   |   |   | 21,789 |   |
| Subordinated secured debt       |   |                                   | — |   |   |   | — |   |   |   | 11,511 |   |   |   | 11,511 |   |
| Preferred equity                |   |                                   | — |   |   |   | — |   |   |   | 9,242 |   |   |   | 9,242 |   |
| Common/common equivalents       |   |                                   | — |   |   |   | — |   |   |   | 1,846 |   |   |   | 1,846 |   |
| Total affiliate investments     |   |                                   | — |   |   |   | — |   |   |   | 44,388 |   |   |   | 44,388 |   |
| Control investments             |   |                                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Senior secured debt             |   |                                   | — |   |   |   | — |   |   |   | 80,995 |   |   |   | 80,995 |   |
| Subordinated secured debt       |   |                                   | — |   |   |   | — |   |   |   | 80,202 |   |   |   | 80,202 |   |
| Unsecured subordinated debt     |   |                                   | — |   |   |   | — |   |   |   | 28,439 |   |   |   | 28,439 |   |
| Preferred equity                |   |                                   | — |   |   |   | — |   |   |   | 220,320 |   |   |   | 220,320 |   |
| Common/common equivalents       |   |                                   | — |   |   |   | — |   |   |   | 28 |   |   |   | 28 |   |
| Total control investments       |   |                                   | — |   |   |   | — |   |   |   | 409,984 |   |   |   | 409,984 |   |
| Total assets at fair value      |   | $                                      | 131     |   |   | $ | 5,189 |   |   | $ | 981,026 |   |   | $ | 986,346 |   |
|                            |   |                                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Liabilities                     |   |                                   |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest rate swaps(a)          |   |                                   | — |   |   |   | (1,054 | ) |   |   | — |   |   |   | (1,054 | ) |
| Total liabilities at fair value |   | $                                      | — |   |   | $ | (1,054 | ) |   | $ | — |   |   | $ | (1,054 | ) |

| (a) | Represents interest rate swaps on loans used as collateral on a securitized borrowing facility.  The fair values of the interest rate swaps are included in other liabilities on our Consolidated Balance Sheets.  See Note 3—Investment Portfolio for additional information about these interest rate swaps. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| · | Majority-Owned Control Investments—Majority-owned control investments comprise 41.2% of our investment portfolio.  Market quotations are not readily available for these investments; therefore, we use a combination of market and income approaches to determine their fair value.  Typically, private companies are bought and sold based on multiples of EBITDA, cash flows, net income, revenues or, in limited cases, book value.  Generally, we apply multiples that we observe for other comparable companies to relevant financial data for the portfolio company.  Also, in a limited number of cases, we use income approaches to determine the fair value of these securities, based on our projections of the discounted future free cash flows that the portfolio company will likely generate, as well as industry derived capital costs.  Our valuation approaches for majority-owned investments estimate the value were we to sell or exit the investment.  These valuation approaches assume the highest and best use of the investment by market participants and consider the value of our ability to control the portfolio company’s capital structure and the timing of a potential exit. |
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| · | Non-Majority-Owned Control Investments—Non-majority owned investments comprise 0.4% of our investment portfolio.  For our non-majority owned equity investments, we use the same market and income valuation approaches used to value our majority-owned control investments.  For non-majority-owned control debt investments, we estimate fair value using the market yield approach based on the expected future cash flows discounted at the loans’ effective interest rates, based on our estimate of current market rates.  We may adjust discounted cash flow calculations to reflect other market conditions or the perceived credit risk of the borrower. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| · | Non-Control Investments—Non-control investments comprise 58.4% of our investment portfolio.  Quoted prices are not available for 99.1% of our non-control investments, which represent 57.9% of our investment portfolio.  For our non-control equity investments, we use the same market and income approaches used to value our control investments.  For non-control debt investments, we estimate fair value using a market yield approach based on the expected future cash flows discounted at the loans’ effective interest rates, based on our estimate of current market rates.  We may adjust discounted cash flow calculations to reflect other market conditions or the perceived credit risk of the borrower. |
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| · | Thinly Traded and Over-the-Counter Securities—Generally, we value securities that are traded in the over-the-counter market or on a stock exchange at the average of the prevailing bid and ask prices on the date of the relevant period end.  However, we may apply a discount to the market value of restricted or thinly traded public securities to reflect the impact that these restrictions have on the value of these securities.  We review factors including the trading volume, total securities outstanding and our percentage ownership of securities to determine whether the trading levels are active (Level 1) or inactive (Level 2).  As of December 31, 2009, these securities represented 0.5% of our investment portfolio. |
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|                                                        |   | As of December 31, 2009 |    |
|-------------------------------------------------------------|--------|------------------------------|---------|
|                                                        |   | Investments at Fair Value    |    |   | Percent of |   |
| (dollars in thousands)                                      |   | Debt                         |    |   | Equity |   |   | Total |   |   | Debt Portfolio |   |   | Equity Portfolio |   |   | Total Portfolio |   |
| Valuations/reviews prepared by independent firms(a)         |   |                         |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Fourth quarter 2009                                         |   | $                            | 160,185 |   |   | $ | 171,419 |   |   | $ | 331,604 |   |   |   | 23.4 | % |   |   | 57.0 | % |   |   | 33.6 | % |
| Third quarter 2009                                          |   |                         | 97,965  |   |   |   | 10,483 |   |   |   | 108,448 |   |   |   | 14.3 |   |   |   | 3.5 |   |   |   | 11.0 |   |
| Second quarter 2009                                         |   |                         | 135,567 |   |   |   | 13,307 |   |   |   | 148,874 |   |   |   | 19.8 |   |   |   | 4.4 |   |   |   | 15.1 |   |
| First quarter 2009                                          |   |                         | 235,551 |   |   |   | 96,758 |   |   |   | 332,309 |   |   |   | 34.3 |   |   |   | 32.1 |   |   |   | 33.7 |   |
| Total valuations/reviews prepared by independent firms |   |                         | 629,268 |   |   |   | 291,967 |   |   |   | 921,235 |   |   |   | 91.8 |   |   |   | 97.0 |   |   |   | 93.4 |   |
| Fair value derived from sales transaction                   |   |                         |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Third quarter 2009                                          |   |                         | 51,768  |   |   |   | — |   |   |   | 51,768 |   |   |   | 7.6 |   |   |   | — |   |   |   | 5.2 |   |
| Total derived from sales transaction                        |   |                         | 51,768  |   |   |   | — |   |   |   | 51,768 |   |   |   | 7.6 |   |   |   | — |   |   |   | 5.2 |   |
| Not evaluated during the 12 months ended December 31, 2009  |   |                         | 4,437   |   |   |   | 8,906 |   |   |   | 13,343 |   |   |   | 0.6 |   |   |   | 3.0 |   |   |   | 1.4 |   |
| Total investment portfolio                                  |   | $                            | 685,473 |   |   | $ | 300,873 |   |   | $ | 986,346 |   |   |   | 100.0 | % |   |   | 100.0 | % |   |   | 100.0 | % |

| (a) | Valuations/reviews prepared by independent firms more than one time during the year ended December 31, 2009 have that investment’s fair value reflected in the most recent quarter for which a valuation/review was prepared. |
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|                                              |   | Fair value measurements using unobservable inputs (Level 3) |    |
|---------------------------------------------------|--------|-------------------------------------------------------------|---------|
| (in thousands)                                    |   | Non-affiliate Investments                                   |    |   | Affiliate Investments |   |   | Control Investments |   |   | Total |   |
| Fair value December 31, 2008                      |   |                                                        |    |   |   |   |   |   |   |   |   |   |
| Senior secured debt                               |   | $                                                           | 289,982 |   |   | $ | 25,467 |   |   | $ | 108,451 |   |   | $ | 423,900 |   |
| Subordinated secured debt                         |   |                                                        | 210,902 |   |   |   | 11,109 |   |   |   | 128,281 |   |   |   | 350,292 |   |
| Unsecured subordinated debt                       |   |                                                        | 2,504   |   |   |   | — |   |   |   | 25,577 |   |   |   | 28,081 |   |
| Preferred equity                                  |   |                                                        | 26,128  |   |   |   | 15,220 |   |   |   | 297,793 |   |   |   | 339,141 |   |
| Common/common equivalents equity                  |   |                                                        | 48,279  |   |   |   | 3,903 |   |   |   | 2,584 |   |   |   | 54,766 |   |
| Total fair value December 31, 2008                |   |                                                        | 577,795 |   |   |   | 55,699 |   |   |   | 562,686 |   |   |   | 1,196,180 |   |
| Realized/unrealized (loss) gain                   |   |                                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Senior secured debt                               |   |                                                        | (10,057 | ) |   |   | 569 |   |   |   | (5,217 | ) |   |   | (14,705 | ) |
| Subordinated secured debt                         |   |                                                        | (8,499  | ) |   |   | 176 |   |   |   | (33,835 | ) |   |   | (42,158 | ) |
| Unsecured subordinated debt                       |   |                                                        | (394    | ) |   |   | — |   |   |   | (1,001 | ) |   |   | (1,395 | ) |
| Preferred equity                                  |   |                                                        | 791     |   |   |   | (6,098 | ) |   |   | (16,792 | ) |   |   | (22,099 | ) |
| Common/common equivalents equity                  |   |                                                        | (6,108  | ) |   |   | (2,057 | ) |   |   | (4,972 | ) |   |   | (13,137 | ) |
| Total realized/unrealized loss                    |   |                                                        | (24,267 | ) |   |   | (7,410 | ) |   |   | (61,817 | ) |   |   | (93,494 | ) |
| Purchases, issuances and (settlements), net       |   |                                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Senior secured debt                               |   |                                                        | (43,109 | ) |   |   | (4,247 | ) |   |   | 10,412 |   |   |   | (36,944 | ) |
| Subordinated secured debt                         |   |                                                        | (40,291 | ) |   |   | 226 |   |   |   | 10,746 |   |   |   | (29,319 | ) |
| Unsecured subordinated debt                       |   |                                                        | 69      |   |   |   | — |   |   |   | 3,863 |   |   |   | 3,932 |   |
| Preferred equity                                  |   |                                                        | (332    | ) |   |   | 120 |   |   |   | (60,536 | ) |   |   | (60,748 | ) |
| Common/common equivalents equity                  |   |                                                        | (1,286  | ) |   |   | — |   |   |   | 2,416 |   |   |   | 1,130 |   |
| Total purchases, issuances and (settlements), net |   |                                                        | (84,949 | ) |   |   | (3,901 | ) |   |   | (33,099 | ) |   |   | (121,949 | ) |
| Transfers into (out of) Level 3                   |   |                                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Senior secured debt                               |   |                                                        | 36,503  |   |   |   | — |   |   |   | (32,651 | ) |   |   | 3,852 |   |
| Subordinated secured debt                         |   |                                                        | 21,572  |   |   |   | — |   |   |   | (24,990 | ) |   |   | (3,418 | ) |
| Preferred equity                                  |   |                                                        | — |   |   |   | — |   |   |   | (145 | ) |   |   | (145 | ) |
| Total transfers into (out of) Level 3             |   |                                                        | 58,075  |   |   |   | — |   |   |   | (57,786 | ) |   |   | 289 |   |
| Fair value as of December 31, 2009                |   |                                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Senior secured debt                               |   |                                                        | 273,319 |   |   |   | 21,789 |   |   |   | 80,995 |   |   |   | 376,103 |   |
| Subordinated secured debt                         |   |                                                        | 183,684 |   |   |   | 11,511 |   |   |   | 80,202 |   |   |   | 275,397 |   |
| Unsecured subordinated debt                       |   |                                                        | 2,179   |   |   |   | — |   |   |   | 28,439 |   |   |   | 30,618 |   |
| Preferred equity                                  |   |                                                        | 26,587  |   |   |   | 9,242 |   |   |   | 220,320 |   |   |   | 256,149 |   |
| Common/common equivalents equity                  |   |                                                        | 40,885  |   |   |   | 1,846 |   |   |   | 28 |   |   |   | 42,759 |   |
| Total fair value as of December 31, 2009          |   | $                                                           | 526,654 |   |   | $ | 44,388 |   |   | $ | 409,984 |   |   | $ | 981,026 |   |

|                                                                          |   | Fair value measurements using unobservable inputs (Level 3) |    |
|-------------------------------------------------------------------------------|--------|-------------------------------------------------------------|---------|
| (in thousands)                                                                |   | Non-affiliate Investments                                   |    |   | Affiliate Investments |   |   | Control Investments |   |   | Total |   |
| Change in unrealized (depreciation) appreciation                              |   |                                                        |    |   |   |   |   |   |   |   |   |   |
| Senior secured debt                                                           |   | $                                                           | (4,717  | ) |   | $ | 569 |   |   | $ | (5,500 | ) |   | $ | (9,648 | ) |
| Subordinated secured debt                                                     |   |                                                        | 365     |   |   |   | 176 |   |   |   | 5,127 |   |   |   | 5,668 |   |
| Unsecured subordinated debt                                                   |   |                                                        | (394    | ) |   |   | — |   |   |   | (1,001 | ) |   |   | (1,395 | ) |
| Preferred equity                                                              |   |                                                        | 791     |   |   |   | (6,098 | ) |   |   | 51,971 |   |   |   | 46,664 |   |
| Common/common equivalents equity                                              |   |                                                        | (6,108  | ) |   |   | (2,057 | ) |   |   | 60,044 |   |   |   | 51,879 |   |
| Total change in unrealized (depreciation) appreciation on Level 3 investments |   | $                                                           | (10,063 | ) |   | $ | (7,410 | ) |   | $ | 110,641 |   |   | $ | 93,168 |   |

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|                                              |   | Fair value measurements using unobservable inputs (Level 3) |    |
|---------------------------------------------------|--------|-------------------------------------------------------------|---------|
| (in thousands)                                    |   | Non-affiliate Investments                                   |    |   | Affiliate Investments |   |   | Control Investments |   |   | Total |   |
| Fair value December 31, 2007                      |   |                                                        |    |   |   |   |   |   |   |   |   |   |
| Senior secured debt                               |   | $                                                           | 271,639 |   |   | $ | 52,293 |   |   | $ | 145,054 |   |   | $ | 468,986 |   |
| Subordinated secured debt                         |   |                                                        | 333,351 |   |   |   | 11,302 |   |   |   | 174,004 |   |   |   | 518,657 |   |
| Unsecured subordinated debt                       |   |                                                        | 7,955   |   |   |   | — |   |   |   | 24,232 |   |   |   | 32,187 |   |
| Preferred equity                                  |   |                                                        | 26,063  |   |   |   | 7,760 |   |   |   | 410,651 |   |   |   | 444,474 |   |
| Common/common equivalents equity                  |   |                                                        | 50,174  |   |   |   | 3,549 |   |   |   | 6,729 |   |   |   | 60,452 |   |
| Total fair value December 31, 2007                |   |                                                        | 689,182 |   |   |   | 74,904 |   |   |   | 760,670 |   |   |   | 1,524,756 |   |
| Realized/unrealized (loss) gain                   |   |                                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Senior secured debt                               |   |                                                        | (4,922  | ) |   |   | (696 | ) |   |   | (15,192 | ) |   |   | (20,810 | ) |
| Subordinated secured debt                         |   |                                                        | (22,780 | ) |   |   | (365 | ) |   |   | (49,603 | ) |   |   | (72,748 | ) |
| Unsecured subordinated debt                       |   |                                                        | (5,633  | ) |   |   | — |   |   |   | (328 | ) |   |   | (5,961 | ) |
| Preferred equity                                  |   |                                                        | (13,130 | ) |   |   | 6,620 |   |   |   | (139,521 | ) |   |   | (146,031 | ) |
| Common/common equivalents equity                  |   |                                                        | 4,088   |   |   |   | 487 |   |   |   | 1,420 |   |   |   | 5,995 |   |
| Total realized/unrealized loss                    |   |                                                        | (42,377 | ) |   |   | 6,046 |   |   |   | (203,224 | ) |   |   | (239,555 | ) |
| Purchases, issuances and (settlements), net       |   |                                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Senior secured debt                               |   |                                                        | 23,265  |   |   |   | (26,130 | ) |   |   | (2,087 | ) |   |   | (4,952 | ) |
| Subordinated secured debt                         |   |                                                        | (99,669 | ) |   |   | 172 |   |   |   | 16,317 |   |   |   | (83,180 | ) |
| Unsecured subordinated debt                       |   |                                                        | 182     |   |   |   | — |   |   |   | 1,673 |   |   |   | 1,855 |   |
| Preferred equity                                  |   |                                                        | 13,190  |   |   |   | 840 |   |   |   | (5,098 | ) |   |   | 8,932 |   |
| Common/common equivalents equity                  |   |                                                        | (5,978  | ) |   |   | (133 | ) |   |   | (5,565 | ) |   |   | (11,676 | ) |
| Total purchases, issuances and (settlements), net |   |                                                        | (69,010 | ) |   |   | (25,251 | ) |   |   | 5,240 |   |   |   | (89,021 | ) |
| Transfers into (out of) Level 3                   |   |                                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Senior secured debt                               |   |                                                        | — |   |   |   | — |   |   |   | (19,324 | ) |   |   | (19,324 | ) |
| Subordinated secured debt                         |   |                                                        | — |   |   |   | — |   |   |   | (12,437 | ) |   |   | (12,437 | ) |
| Preferred equity                                  |   |                                                        | 5       |   |   |   | — |   |   |   | 31,761 |   |   |   | 31,766 |   |
| Common/common equivalents equity                  |   |                                                        | (5      | ) |   |   | — |   |   |   | — |   |   |   | (5 | ) |
| Total transfers into (out of) Level 3             |   |                                                        | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Fair value as of December 31, 2008                |   |                                                        |    |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Senior secured debt                               |   |                                                        | 289,982 |   |   |   | 25,467 |   |   |   | 108,451 |   |   |   | 423,900 |   |
| Subordinated secured debt                         |   |                                                        | 210,902 |   |   |   | 11,109 |   |   |   | 128,281 |   |   |   | 350,292 |   |
| Unsecured subordinated debt                       |   |                                                        | 2,504   |   |   |   | — |   |   |   | 25,577 |   |   |   | 28,081 |   |
| Preferred equity                                  |   |                                                        | 26,128  |   |   |   | 15,220 |   |   |   | 297,793 |   |   |   | 339,141 |   |
| Common/common equivalents equity                  |   |                                                        | 48,279  |   |   |   | 3,903 |   |   |   | 2,584 |   |   |   | 54,766 |   |
| Total fair value as of December 31, 2008          |   | $                                                           | 577,795 |   |   | $ | 55,699 |   |   | $ | 562,686 |   |   | $ | 1,196,180 |   |

|                                                                          |   | Fair value measurements using unobservable inputs (Level 3) |    |
|-------------------------------------------------------------------------------|--------|-------------------------------------------------------------|---------|
| (in thousands)                                                                |   | Non-affiliate Investments                                   |    |   | Affiliate Investments |   |   | Control Investments |   |   | Total |   |
| Change in unrealized (depreciation) appreciation                              |   |                                                        |    |   |   |   |   |   |   |   |   |   |
| Senior secured debt                                                           |   | $                                                           | (4,922  | ) |   | $ | (696 | ) |   | $ | (6,931 | ) |   | $ | (12,549 | ) |
| Subordinated secured debt                                                     |   |                                                        | (22,780 | ) |   |   | (365 | ) |   |   | (49,603 | ) |   |   | (72,748 | ) |
| Unsecured subordinated debt                                                   |   |                                                        | (5,633  | ) |   |   | — |   |   |   | (328 | ) |   |   | (5,961 | ) |
| Preferred equity                                                              |   |                                                        | (13,245 | ) |   |   | 6,620 |   |   |   | (140,521 | ) |   |   | (147,146 | ) |
| Common/common equivalents equity                                              |   |                                                        | (1,256  | ) |   |   | 487 |   |   |   | 8,748 |   |   |   | 7,979 |   |
| Total change in unrealized (depreciation) appreciation on Level 3 investments |   | $                                                           | (47,836 | ) |   | $ | 6,046 |   |   | $ | (188,635 | ) |   | $ | (230,425 | ) |

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|                   |   | Investments at Fair Value |    |   | Revenue for the year ended |   |
|------------------------|--------|---------------------------|---------|--------|----------------------------|--------|
|                   |   | December 31, 2009    |    |   | December 31, 2008     |   |   | December 31, 2009 |   |   | December 31, 2008 |   |
| (dollars in thousands) |   | Amount                    |    |   | % of Total Portfolio       |   |   | Amount |   |   | % of Total Portfolio |   |   | Amount |   |   | % of Total Revenue |   |   | Amount |   |   | % of Total Revenue |   |
| Industry               |   |                      |    |   |                       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Communications         |   | $                         | 188,149 |   |                       |   | 19.0 | % |   | $ | 191,192 |   |   |   | 15.9 | % |   | $ | 4,391 |   |   |   | 4.4 | % |   | $ | 15,539 |   |   |   | 11.5 | % |
| Cable                  |   |                      | 128,386 |   |                       |   | 13.0 |   |   |   | 119,134 |   |   |   | 9.9 |   |   |   | 11,036 |   |   |   | 11.1 |   |   |   | 10,512 |   |   |   | 7.8 |   |
| Healthcare             |   |                      | 100,278 |   |                       |   | 10.2 |   |   |   | 123,589 |   |   |   | 10.3 |   |   |   | 11,593 |   |   |   | 11.6 |   |   |   | 15,230 |   |   |   | 11.3 |   |
| Food services          |   |                      | 70,035  |   |                       |   | 7.1 |   |   |   | 81,935 |   |   |   | 6.8 |   |   |   | 11,553 |   |   |   | 11.6 |   |   |   | 11,004 |   |   |   | 8.1 |   |

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|                                  |           |   | December 31, 2009      |    |   | December 31, 2008 |   |
|---------------------------------------|----------------|--------|-----------------------------|---------|--------|------------------------|--------|
| (dollars in thousands)                | Maturity Date  |   | Potential Maximum Borrowing |    |   | Amount Outstanding     |   |   | Potential Maximum Borrowing |   |   | Amount Outstanding |   |
| Private Placement Notes               |           |   |                        |    |   |                   |   |   |   |   |   |   |   |
| Series 2005-A                         | October 2011   |   | $                           | 34,307  |   |                   | $      | 34,307 |   |   | $ | 50,000 |   |   | $ | 50,000 |   |
| Series 2007-A                         | October 2012   |   |                        | 17,154  |   |                   |   | 17,154 |   |   |   | 25,000 |   |   |   | 25,000 |   |
| Commercial Loan Funding Trust         |           |   |                        |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Class A Variable Funding Certificate  | August 2011(a) |   |                        | 170,694 |   |                   |   | 158,907 |   |   |   | 218,750 |   |   |   | 162,219 |   |
| Class B Variable Funding Certificate  | August 2011(a) |   |                        | — |   |                   |   | — |   |   |   | 31,250 |   |   |   | 24,950 |   |
| Commercial Loan Trust 2006-1          |           |   |                        |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Series 2006-1 Class A-1 Notes         | April 2018     |   |                        | 106,250 |   |                   |   | 106,250 |   |   |   | 106,250 |   |   |   | 106,250 |   |
| Series 2006-1 Class A-2 Notes         | April 2018     |   |                        | 50,000  |   |                   |   | — |   |   |   | 50,000 |   |   |   | — |   |
| Series 2006-1 Class A-3 Notes         | April 2018     |   |                        | 85,000  |   |                   |   | 85,000 |   |   |   | 85,000 |   |   |   | 85,000 |   |
| Series 2006-1 Class B Notes           | April 2018     |   |                        | 58,750  |   |                   |   | 58,750 |   |   |   | 58,750 |   |   |   | 58,750 |   |
| Series 2006-1 Class C Notes(b)        | April 2018     |   |                        | 45,000  |   |                   |   | 40,000 |   |   |   | 45,000 |   |   |   | 40,000 |   |
| Series 2006-1 Class D Notes(c)        | April 2018     |   |                        | 47,500  |   |                   |   | 29,880 |   |   |   | 47,500 |   |   |   | 37,380 |   |
| Unsecured Revolving Line of Credit(d) | May 2009       |   |                        | — |   |                   |   | — |   |   |   | 70,000 |   |   |   | 44,500 |   |
| SBIC (Maximum borrowing potential)(e) | (f)            |   |                        | 130,000 |   |                   |   | 27,600 |   |   |   | 130,000 |   |   |   | 2,600 |   |
| Total borrowings                      |           |   | $                           | 744,655 |   |                   | $      | 557,848 |   |   | $ | 917,500 |   |   | $ | 636,649 |   |

| (a) | Renewable each February at the lender’s discretion.  The lender provided this renewal in February 2010.  In conjunction with this renewal, the legal final maturity date became August 2012.  See Note 16—Subsequent Events for additional information about this renewal.  In February 2009 the Class B advances were retired. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | Amount outstanding excludes $5.0 million of notes that we repurchased in December 2008 for $1.6 million.  The notes that MCG, the parent company, purchased are eliminated from this schedule as part of the consolidation process. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | Amount outstanding excludes $10.1 million of notes that we repurchased in December 2008 for $2.4 million and $7.5 million of notes that we repurchased in January 2009 for $2.1 million.  The notes that MCG, the parent company, purchased are eliminated from this schedule as part of the consolidation process. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | On May 4, 2009, we repaid the balance of this facility. |
|-----|---------------------------------------------------------|

| (e) | As of December 31, 2009, we had the potential to borrow up to $130.0 million of SBA-guaranteed debentures under the SBIC program. The SBA has approved and committed up to $130.0 million in borrowings to the SBIC.  To realize the full $130.0 million borrowing potential approved and committed by the SBIC under this program, we must fund a total of $65.0 million to the SBIC, of which we have funded $18.6 million as of December 31, 2009.  Based on our funded capital, Solutions Capital I, L.P., subject to the SBA’s approval, may borrow up to an additional $28.3 million to originate investments as of December 31, 2009.  To access the entire $130.0 million that has been approved and committed by the SBA, we would have to fund an additional $46.4 million.  In February 2009, the American Recovery and Reinvestment Act of 2009 was passed into law which, among other things, included a provision that increased the maximum amount of outstanding leverage available to single-license SBIC companies up to $150.0 million. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (f) | Currently, we may originate new borrowings through September 2012 at which time we can apply for a new commitment.  We must repay borrowings under the SBIC program within ten years after the borrowing date, which will occur between September 2018 and September 2022. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|           |   | December 31, 2009 |    |
|----------------|--------|------------------------|---------|
| (in thousands) |   | Debt withRecourse      |    |   | Debt without Recourse |   |   | Total |   |
| 2010(a)        |   | $                      | — |   |   | $ | 13,327 |   |   | $ | 13,327 |   |
| 2011           |   |                   | 34,307  |   |   |   | 145,580 |   |   |   | 179,887 |   |
| 2012           |   |                   | — |   |   |   | — |   |   |   | — |   |
| 2013           |   |                   | 17,154  |   |   |   | — |   |   |   | 17,154 |   |
| 2014           |   |                   | — |   |   |   | — |   |   |   | — |   |
| Thereafter(b)  |   |                   | 27,600  |   |   |   | 319,880 |   |   |   | 347,480 |   |
| Total          |   | $                      | 79,061  |   |   | $ | 478,787 |   |   | $ | 557,848 |   |

| (a) | Certain of our borrowing facilities contain provisions that require that we apply a portion of the proceeds we receive from certain monetizations to paydown a portion of the outstanding balances.  The amounts payable in 2010 reflect the paydowns we were required to make in connection with monetizations that occurred through December 31, 2009. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (b) | Recourse on Solutions Capital I, L.P.’s outstanding debt is limited to MCG’s commitment of $65.0 million.  As of December 31, 2009, we had $27.6 million of debt outstanding.                                                                                                                                                                |

|                    |   | December 31, |    |
|-------------------------|--------|-------------------|---------|
| (in thousands)          |   | 2009              |    |   | 2008 |   |
| Interest rate benchmark |   |              |    |   |   |   |
| LIBOR                   |   | $                 | 319,880 |   |   | $ | 371,880 |   |
| Commercial paper rate   |   |              | 158,907 |   |   |   | 187,169 |   |
| Fixed rate              |   |              | 79,061  |   |   |   | 77,600 |   |
| Total borrowings        |   | $                 | 557,848 |   |   | $ | 636,649 |   |

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| (in thousands)     |   | Private Placement Note Series 2005-A |   |   | Private Placement Note Series 2007-A                  |   |
|--------------------|--------|--------------------------------------|--------|--------|-------------------------------------------------------|--------|
| Quarter Ended      |   | Monetization Payment                 |   |   | Maximum Borrowing Capacity After Monetization Payment |   |   | Monetization Payment |   |   | Maximum Borrowing Capacity After Monetization Payment |   |
| March 31, 2009     |   | $                                    | 5,314  |   |                                                  | $      | 44,686 |   |   |   | 2,658 |   |   | $ | 22,342 |   |
| June 30, 2009      |   |                                 | 3,128  |   |                                                  |   | 41,558 |   |   |   | 1,564 |   |   |   | 20,778 |   |
| September 30, 2009 |   |                                 | 3,917  |   |                                                  |   | 37,641 |   |   |   | 1,958 |   |   |   | 18,820 |   |
| December 31, 2009  |   |                                 | 3,334  |   |                                                  |   | 34,307 |   |   |   | 1,666 |   |   |   | 17,154 |   |

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|                          |   | December 31, 2009 |    |   | December 31, 2008 |   |
|-------------------------------|--------|------------------------|---------|--------|------------------------|--------|
| (dollars in thousands)        |   | Amount                 |    |   | %                      |   |   | Amount |   |   | % |   |
| Securitized assets            |   |                   |    |   |                   |   |   |   |   |   |   |   |
| Senior secured debt           |   | $                      | 140,483 |   |                   |   | 53.0 | % |   | $ | 164,188 |   |   |   | 61.9 | % |
| Subordinated secured debt     |   |                   | 102,170 |   |                   |   | 38.6 |   |   |   | 91,347 |   |   |   | 34.4 |   |
| Total securitized assets      |   |                   | 242,653 |   |                   |   | 91.6 |   |   |   | 255,535 |   |   |   | 96.3 |   |
| Cash, securitization accounts |   |                   | 22,129  |   |                   |   | 8.4 |   |   |   | 9,806 |   |   |   | 3.7 |   |
| Total collateral              |   | $                      | 264,782 |   |                   |   | 100.0 | % |   | $ | 265,341 |   |   |   | 100.0 | % |

| (in thousands)     |   | Monetization Payment |   |   | Maximum Borrowing Capacity After Monetization Payment |   |
|--------------------|--------|----------------------|--------|--------|-------------------------------------------------------|--------|
| Quarter ended      |   |                 |   |   |                                                  |   |
| March 31, 2009     |   | $                    | 1,491  |   |                                                  | $      | 188,509 |   |
| June 30, 2009      |   |                 | 2,894  |   |                                                  |   | 185,615 |   |
| September 30, 2009 |   |                 | 9,967  |   |                                                  |   | 175,648 |   |
| December 31, 2009  |   |                 | 4,954  |   |                                                  |   | 170,694 |   |

|                          |   | December 31, 2009 |    |   | December 31, 2008 |   |
|-------------------------------|--------|------------------------|---------|--------|------------------------|--------|
| (dollars in thousands)        |   | Amount                 |    |   | %                      |   |   | Amount |   |   | % |   |
| Securitized assets            |   |                   |    |   |                   |   |   |   |   |   |   |   |
| Senior secured debt           |   | $                      | 196,036 |   |                   |   | 47.2 | % |   | $ | 224,661 |   |   |   | 53.0 | % |
| Subordinated secured debt     |   |                   | 132,169 |   |                   |   | 31.8 |   |   |   | 171,914 |   |   |   | 40.5 |   |
| Total securitized assets      |   |                   | 328,205 |   |                   |   | 79.0 |   |   |   | 396,575 |   |   |   | 93.5 |   |
| Cash, securitization accounts |   |                   | 87,012  |   |                   |   | 21.0 |   |   |   | 27,687 |   |   |   | 6.5 |   |
| Total collateral              |   | $                      | 415,217 |   |                   |   | 100.0 | % |   | $ | 424,262 |   |   |   | 100.0 | % |

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|                                   |   |   | Amount Outstanding     |   |   |                   |   |    |   |
|----------------------------------------|--------|--------|------------------------|--------|--------|------------------------|--------|---------|--------|
| (dollars in thousands)                 |   |   | December 31, 2009 |   |   | December 31, 2008 |   |    | Rate   |   | Treasury Rate at Pooling Date |   |   | Spread in basis points |   |
| Tranche                                |   |   |                   |   |   |                   |   |    |   |   |   |   |   |   |   |   |   |
|      2008-10B |   |   | $                      | 2,600  |   |                   | $      | 2,600   |   |   |   | 6.44 | % | Fixed |   |   | 3.80 | % |   |   | 264 |   |
|      2009-10A      |   |   |                   | 12,000 |   |                   |   | — |   |   |   | 5.34 | % | Fixed |   |   | 2.81 | % |   |   | 253 |   |
|      2009-10B      |   |   |                   | 13,000 |   |                   |   | — |   |   |   | 4.95 | % | Fixed |   |   | 3.44 | % |   |   | 151 |   |
| Total                                  |   |   | $                      | 27,600 |   |                   | $      | 2,600   |   |   |   | 5.19 | % |   |   |   | 3.16 | % |   |   | 203 |   |

| Date Declared     |   | Record Date         |   | Payment Date         |   |   | Amount |   |
|-------------------|--------|---------------------|--------|----------------------|--------|--------|--------|--------|
| May 6, 2008       |   |  June 30, 2008 |   |  July 30, 2008  |   |   | $      | 0.27   |   |
| February 22, 2008 |   | March 12, 2008      |   |  April 29, 2008 |   |   |   | 0.44   |   |
| October 25, 2007  |   | November 21, 2007   |   | January 30, 2008     |   |   |   | 0.44   |   |
| July 26, 2007     |   | August 23, 2007     |   | October 30, 2007     |   |   |   | 0.44   |   |
| April 17, 2007    |   |  May 24, 2007  |   |  July 30, 2007  |   |   |   | 0.44   |   |
| February 15, 2007 |   | March 15, 2007      |   |  April 27, 2007 |   |   |   | 0.44   |   |

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| Year         |                        |                                       | Number of Shares |      |
|--------------|-----------------------------|--------------------------------------------|------------------|-----------|
| Awarded      | Forfeiture Provision Expire | Basis for  Forfeiture Provisions |             | Awarded   |   |   | Forfeiture Provisions Lapsed |   |   | Forfeited |   |   | Outstanding as of December 31, 2009 |   |
| 2009         | 2009                        | Service                                    |             |      | 288,300 |   |   |   | (288,300 | ) |   |   | — |   |   |   | — |   |
| 2009         | 2010                        | Service                                    |             |      | 144,200 |   |   |   | — |   |   |   | — |   |   |   | 144,200 |   |
| 2009         | 2010                        | Service and Performance                    |             |      | 42,500 |   |   |   | — |   |   |   | — |   |   |   | 42,500 |   |
| 2008         | 2011                        | Service                                    |             |      | 897,500 |   |   |   | (41,700 | ) |   |   | (174,000 | ) |   |   | 681,800 | (b) |
| 2008         | 2012                        | Service                                    |             |      | 438,100 |   |   |   | (167,300 | ) |   |   | (91,400 | ) |   |   | 179,400 |   |
| 2007         | 2011                        | Service                                    |             |      | 836,100 |   |   |   | (606,200 | ) |   |   | (113,300 | ) |   |   | 116,600 |   |
| 2007         | 2008                        | Service and Performance                    |             |      | 100,000 |   |   |   | (88,400 | ) |   |   | (2,400 | ) |   |   | 9,200 | (a) |
| 2006         | 2006                        | Service                                    |             |      | 83,000 |   |   |   | (83,000 | ) |   |   | — |   |   |   | — |   |
| 2006         | 2008                        | Service                                    |             |      | 100,000 |   |   |   | (100,000 | ) |   |   | — |   |   |   | — |   |
| 2006         | 2009                        | Service                                    |             |      | 300,000 |   |   |   | (300,000 | ) |   |   | — |   |   |   | — |   |
| Total shares |                        |                                       |             | 3,229,700 |   |   |   | (1,674,900 | ) |   |   | (381,100 | ) |   |   | 1,173,700 |   |

| (a) | Represents performance shares in trust. |
|-----|-----------------------------------------|

| (b) | Includes 647,500 shares of restricted common stock awarded as part of the Retention Program. |
|-----|----------------------------------------------------------------------------------------------|

|        |   |   | Potential Stock Awards |    |   |             |   |
|-------------|--------|--------|------------------------|---------|--------|------------------|--------|
| Share Price |   |   | % of Award             |    |   | Number of Shares |   |   | Aggregate Dollar Amount for Each Share Price threshold Achieved |   |
| $3.00       |   |   |                   | 25      | %      |             |   | 216,250 |   |   | $ | — |   |
| $4.00       |   |   |                   | 25      | %      |             |   | 216,250 |   |   |   | — |   |
| $5.00       |   |   |                   | 25      | %      |             |   | 216,250 |   |   |   | 1,000,000 |   |
| $6.00       |   |   |                   | 15      | %      |             |   | 129,750 |   |   |   | 996,000 |   |
| $7.00       |   |   |                   | 10      | %      |             |   | 86,500 |   |   |   | 1,006,000 |   |
| $8.00       |   |   |                   | — | %      |             |   | — |   |   |   | 2,209,000 |   |
|        |   |   |                   | 100     | %      |             |   | 865,000 |   |   | $ | 5,211,000 |   |

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|                                                        |   | Shares |      |   | Weighted-Average Grant Date Fair Value per Share |   |
|-------------------------------------------------------------|--------|--------|-----------|--------|--------------------------------------------------|--------|
| Subject to forfeiture provisions as of December 31, 2008(a) |   |   | 1,451,000 |   |                                             | $      | 8.49 |   |
| Awarded                                                     |   |   | 497,500   | (d)    |                                             |   | 2.50 |   |
| Forfeiture period lapsed                                    |   |   | (703,700  | )      |                                             |   | 6.58 |   |
| Forfeited(b)                                                |   |   | (36,000   | )      |                                             |   | 6.74 |   |
| Subject to forfeiture provisions as of December 31, 2009(c) |   |   | 1,208,800 |   |                                             | $      | 5.42 |   |

| (a) | Includes 11,600 performance shares held in trust with a weighted-average award date fair value of $19.37 per share.          |
|-----|------------------------------------------------------------------------------------------------------------------------------|
| (b) | Includes 2,400 performance shares that were held in trust with a weighted-average award date fair value of $19.37 per share. |
| (c) | Includes 9,200 performance shares held in trust with a weighted-average award date fair value of $19.37 per share.           |
| (d) | Includes 42,500 performance shares held in trust with a weighted-average award date fair value of $2.93 per share.           |

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| (in thousands)                  |   | SeveranceBenefits(a) |    |   | FacilityClosure(b) |   |    | Total  |   |
|---------------------------------|--------|----------------------|---------|--------|--------------------|--------|---------|--------|--------|
| Balance as of January 1, 2008   |   | $                    | — |   |               | $      | — |   |   | $ | — |   |
| Additions                       |   |                 | 859     |   |               |   | 228     |   |   |   | 1,087 |   |
| Cash payments                   |   |                 | (592    | )      |               |   | (35     | )      |   |   | (627 | ) |
| Accretion                       |   |                 | 5       |   |               |   | 1       |   |   |   | 6 |   |
| Balance as of December 31, 2008 |   | $                    | 272     |   |               | $      | 194     |   |   | $ | 466 |   |
| Additions                       |   |                 | 4       |   |               |   | 55      |   |   |   | 59 |   |
| Cash payments                   |   |                 | (99     | )      |               |   | (140    | )      |   |   | (239 | ) |
| Accretion                       |   |                 | 1       |   |               |   | 2       |   |   |   | 3 |   |
| Balance as of December 31, 2009 |   | $                    | 178     |   |               | $      | 111     |   |   | $ | 289 |   |

| (a) |  Includes the cost of severance and continuation of benefits.  In addition, includes share-based compensation expenses associated with the lapsing of forfeiture restrictions associated with restricted stock awards for affected employees.  In total, the forfeiture provisions on 22,100 shares of restricted stock lapsed over the employees’ respective three- to six-month vesting periods. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (b) |  Includes $0.3 million and $0.4 million of lease payments, partially offset by $0.2 million and $0.2 million of sublease payments, as of December 31, 2009 and 2008, respectively, which represents the present value of the future cash flows from facilities vacated as part of the corporate restructuring. In addition, $0.1 million of fees incurred to sublet these facilities were included as of December 31, 2008.  |

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|                     |   | Dividends per share |    |
|--------------------------|--------|---------------------|---------|
|                     |   | Declared            |    |   | Paid |   |
| Years ended December 31, |   |                |    |   |   |   |
| 2009                     |   | $                   | — |   |   | $ | — |   |
| 2008                     |   |                | 0.71    |   |   |   | 1.15 |   |
| 2007                     |   |                | 1.76    |   |   |   | 1.74 |   |

|                                                                                               |   | Years ended December 31, |    |
|----------------------------------------------------------------------------------------------------|--------|-------------------------------|---------|
|                                                                                               |   | 2008                          |    |   | 2007 |   |
|                                                                                               |   | $/Share                       |    |   | % of Total |   |   | $/Share |   |   | % of Total |   |
| Dividends declared during the year                                                                 |   | $                             | 0.71    |   |   |   |   |   | $ | 1.76 |   |   |   |   |
| Dividends declared in 2007 but treated as taxable in 2008 as required by the Internal Revenue Code |   |                          | 0.44    |   |   |   |   |   |   | (0.44 | ) |   |   |   |
| Dividends declared in 2006 but treated as taxable in 2007 as required by the Internal Revenue Code |   |                          | — |   |   |   |   |   |   | 0.42 |   |   |   |   |
| Dividends paid for tax purposes                                                                    |   | $                             | 1.15    |   |   |   |   |   | $ | 1.74 |   |   |   |   |
| Dividends declared on tax Form 1099-DIV                                                            |   |                          |    |   |   |   |   |   |   |   |   |   |   |   |
| Ordinary income(a)                                                                                 |   | $                             | — |   |   |   | — | % |   | $ | 1.52 |   |   |   | 87.4 | % |
| Long-term capital gains(a)                                                                         |   |                          | 0.02    |   |   |   | 1.7 |   |   |   | 0.22 |   |   |   | 12.6 |   |
| Return of capital(b)                                                                               |   |                          | 1.13    |   |   |   | 98.3 |   |   |   | — |   |   |   | — |   |
| Total reported on tax Form 1099-DIV                                                                |   | $                             | 1.15    |   |   |   | 100.0 | % |   | $ | 1.74 |   |   |   | 100.0 | % |

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|                                                                  |   | December 31, |      |
|-----------------------------------------------------------------------|--------|-------------------|-----------|
| (in thousands)                                                        |   | 2009              |      |   | 2008 |   |
| Cost for federal income tax purposes                                  |   | $                 | 1,091,650 |   |   | $ | 1,413,241 |   |
| Gross unrealized appreciation                                         |   |              |      |   |   |   |   |   |
| Unrealized appreciation of fair value of portfolio investments (GAAP) |   |              | 62,705    |   |   |   | 85,754 |   |
| Book to tax differences                                               |   |              | 88,898    |   |   |   | 91,770 |   |
| Gross unrealized appreciation—tax basis                         |   |              | 151,603   |   |   |   | 177,524 |   |
| Gross unrealized depreciation                                         |   |              |      |   |   |   |   |   |
| Unrealized depreciation of fair value of portfolio investments (GAAP) |   |              | (233,022  | ) |   |   | (353,702 | ) |
| Book to tax differences                                               |   |              | (25,624   | ) |   |   | (34,888 | ) |
| Gross unrealized depreciation—tax basis                         |   |              | (258,646  | ) |   |   | (388,590 | ) |
| Net unrealized depreciation—tax basis                           |   |              | (107,043  | ) |   |   | (211,066 | ) |
| Less: Unrealized depreciation of fair value of other assets (GAAP)    |   |              | 1,739     |   |   |   | 973 |   |
| Total investments at fair value (GAAP)                                |   | $                 | 986,346   |   |   | $ | 1,203,148 |   |

|                                                                                           |   | Years ended December 31, |    |
|------------------------------------------------------------------------------------------------|--------|-------------------------------|---------|
| (in thousands)                                                                                 |   | 2009                          |    |   | 2008 |   |
| Net loss                                                                                       |   | $                             | (51,059 | ) |   | $ | (191,245 | ) |
| Difference between book and tax loss on investments(a)                                         |   |                          | 48,078  |   |   |   | (73,272 | ) |
| Net change in unrealized (appreciation) depreciation on investments not taxable until realized |   |                          | (97,631 | ) |   |   | 248,218 |   |
| Capital losses in excess of capital gains                                                      |   |                          | 54,245  |   |   |   | — |   |
| Timing difference related to deductibility of long-term incentive compensation                 |   |                          | 6,091   |   |   |   | 6,642 |   |
| Taxable interest income on non-accrual loans(b)                                                |   |                          | 14,949  |   |   |   | 2,051 |   |
| Dividend income accrued for GAAP purposes that is not yet taxable                              |   |                          | (6,149  | ) |   |   | (19,972 | ) |
| Distributions from taxable subsidiaries                                                        |   |                          | 144     |   |   |   | 483 |   |
| Federal tax (benefit) provision                                                                |   |                          | (81     | ) |   |   | 789 |   |
| Other, net                                                                                     |   |                          | 323     |   |   |   | 4,181 |   |
| Taxable loss before deductions for distributions                                               |   | $                             | (31,090 | ) |   | $ | (22,125 | ) |

| (a) | Results for the year ended December 31, 2008, primarily reflect the write-off, for tax purposes, of the common stock of Cleartel. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------|

| (b) | Results for the years ended December 31, 2008 and 2009, reflect the reversal of interest that we previously recognized on non-accrual loans of a portfolio investment that we liquidated.  We applied the proceeds from the liquidation to the portfolio company’s outstanding principal balance on the debt obligation to us. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                                        |   | Years ended December 31, |    |
|-----------------------------------------------------------------------------|--------|-------------------------------|---------|
| (dollars in thousands, except per share amounts)                            |   | 2009                          |    |   | 2008 |   |   | 2007 |   |
| Numerator for basic and diluted (loss) earnings per share                   |   |                          |    |   |   |   |   |   |   |
| Net (loss) income                                                           |   | $                             | (51,059 | ) |   | $ | (191,245 | ) |   | $ | 86,636 |   |
| Less: Dividends declared—common and restricted shares                 |   |                          | — |   |   |   | (49,272 | ) |   |   | (110,045 | ) |
| Undistributed earnings                                                      |   |                          | (51,059 | ) |   |   | (240,517 | ) |   |   | (23,409 | ) |
| Percentage allocated to common shares(a)                                    |   |                          | 100.0   | % |   |   | 100.0 | % |   |   | 98.3 | % |
| Undistributed earnings—common shares                                  |   |                          | (51,059 | ) |   |   | (240,517 | ) |   |   | (23,011 | ) |
| Add: Dividends declared—common shares                                 |   |                          | — |   |   |   | 48,559 |   |   |   | 108,091 |   |
| Common shares                                                               |   |                          | (51,059 | ) |   |   | (191,958 | ) |   |   | 85,080 |   |
| Add: Participating unvested shares                                          |   |                          | — |   |   |   | 713 |   |   |   | 1,556 |   |
| Numerator for basic and diluted (loss) earnings per share—total       |   | $                             | (51,059 | ) |   | $ | (191,245 | ) |   | $ | 86,636 |   |
| Denominator for basic and diluted weighted-average shares outstanding       |   |                          |    |   |   |   |   |   |   |   |   |   |
| Common shares outstanding                                                   |   |                          | 74,692  |   |   |   | 72,254 |   |   |   | 64,498 |   |
| Participating unvested shares(b)                                            |   |                          | — |   |   |   | — |   |   |   | 1,108 |   |
| Basic and diluted weighted-average common shares outstanding—total(b) |   |                          | 74,692  |   |   |   | 72,254 |   |   |   | 65,606 |   |
| (Loss) Earnings per share—basic and diluted                           |   | $                             | (0.68   | ) |   | $ | (2.65 | ) |   | $ | 1.32 |   |
|                                                                        |   |                          |    |   |   |   |   |   |   |   |   |   |   |
| (a)Weighted-average shares                                                  |   |                          |    |   |   |   |   |   |   |   |   |   |
| Weighted-average common shares                                              |   |                          |    |   |   |   |   |   |   |   |   |   |
| Weighted-average common shares outstanding                                  |   |                          | 74,692  |   |   |   | 71,162 |   |   |   | 61,310 |   |
| Adjustment for bonus element of rights offering(b)                          |   |                          | — |   |   |   | 1,092 |   |   |   | 3,188 |   |
| Basic weighted-average common shares                                        |   |                          | 74,692  |   |   |   | 72,254 |   |   |   | 64,498 |   |
| Weighted-average restricted shares                                          |   |                          |    |   |   |   |   |   |   |   |   |   |
| Weighted-average restricted shares                                          |   |                          | — |   |   |   | — |   |   |   | 1,053 |   |
| Bonus element of rights offering                                            |   |                          | — |   |   |   | — |   |   |   | 55 |   |
| Total weighted-average restricted shares(b)                                 |   |                          | — |   |   |   | — |   |   |   | 1,108 |   |
| Total(b)                                                                    |   |                          | 74,692  |   |   |   | 72,254 |   |   |   | 65,606 |   |
| Percentage allocated to common shares                                       |   |                          | 100.0   | % |   |   | 100.0 | % |   |   | 98.3 | % |

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|                       |   | As of December 31, |    |
|----------------------------|--------|-------------------------|---------|
| (in thousands)             |   | 2009                    |    |   | 2008 |   |
| Unused loan commitments(a) |   | $                       | 36,546  |   |   | $ | 43,393 |   |
| Guarantees                 |   |                    | — |   |   |   | 5,833 |   |
| Standby letters of credit  |   |                    | — |   |   |   | 97 |   |

| (a) | Estimated fair value of unused loan commitments as of both December 31, 2009 and 2008 was $0.2 million, based on the fees that we currently charge to enter into similar arrangements, taking into account the creditworthiness of the counterparties. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| \(in thousands)          |   | Lease Commitments(a) |   |   | Sublease |   |    | Lease Commitments Less Sublease |   |
|--------------------------|--------|----------------------|--------|--------|----------|--------|---------|---------------------------------|--------|
| Year ending December 31, |   |                 |   |   |     |   |    |                            |   |
| 2010                     |   | $                    | 2,366  |   |     | $      | (261    | )                               |   | $ | 2,105 |   |
| 2011                     |   |                 | 2,252  |   |     |   | (232    | )                               |   |   | 2,020 |   |
| 2012                     |   |                 | 2,065  |   |     |   | (60     | )                               |   |   | 2,005 |   |
| 2013                     |   |                 | 392    |   |     |   | — |                            |   |   | 392 |   |
| Total                    |   | $                    | 7,075  |   |     | $      | (553    | )                               |   | $ | 6,522 |   |

| (a) | Effective January 1, 2010, we negotiated a reduction of unused space that previously had been included in our California lease.  As a result, our minimum lease payments for both 2010 and 2011 have been reduced by $0.1 million resulting in total future minimum net lease payments of $6.3 million. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                                                                                  |   | Years Ended December 31, |    |
|-----------------------------------------------------------------------------------------------------------------------|--------|-------------------------------|---------|
| (in thousands, except per share amounts)                                                                              |   | 2009                          |    |   | 2008 |   |   | 2007 |   |   | 2006 |   |   | 2005 |   |
| Per Share Data                                                                                                        |   |                          |    |   |   |   |   |   |   |   |   |   |   |   |   |
| Net asset value at beginning of year(a)                                                                               |   | $                             | 8.66    |   |   | $ | 12.73 |   |   | $ | 12.83 |   |   | $ | 12.48 |   |   | $ | 12.22 |   |
| Net (loss) income(b)                                                                                                  |   |                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net operating income before investment (loss) gain, gain on extinguishment of debt and income tax (benefit) provision |   |                          | 0.51    |   |   |   | 0.78 |   |   |   | 1.55 |   |   |   | 1.46 |   |   |   | 1.19 |   |
| Net change in unrealized depreciation on investments                                                                  |   |                          | 1.31    |   |   |   | (3.44 | ) |   |   | (0.53 | ) |   |   | 0.60 |   |   |   | (0.03 | ) |
| Net realized (losses) gains on investments                                                                            |   |                          | (2.57   | ) |   |   | (0.13 | ) |   |   | 0.34 |   |   |   | (0.25 | ) |   |   | 0.18 |   |
| Gain on extinguishment of debt                                                                                        |   |                          | 0.07    |   |   |   | 0.15 |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Income tax provision                                                                                                  |   |                          | — |   |   |   | (0.01 | ) |   |   | (0.04 | ) |   |   | (0.05 | ) |   |   | — |   |
| Net (loss) income                                                                                                     |   |                          | (0.68   | ) |   |   | (2.65 | ) |   |   | 1.32 |   |   |   | 1.76 |   |   |   | 1.34 |   |
| Net decrease in net assets resulting from distributions                                                               |   |                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| From net investment income                                                                                            |   |                          | — |   |   |   | — |   |   |   | (1.41 | ) |   |   | (1.01 | ) |   |   | (1.27 | ) |
| From capital gains                                                                                                    |   |                          | — |   |   |   | — |   |   |   | (0.35 | ) |   |   | — |   |   |   | (0.19 | ) |
| From return of capital                                                                                                |   |                          | — |   |   |   | (0.71 | ) |   |   | — |   |   |   | (0.67 | ) |   |   | (0.22 | ) |
| Effect of stock offerings after record dates(d)                                                                       |   |                          | — |   |   |   | — |   |   |   | 0.02 |   |   |   | 0.12 |   |   |   | 0.16 |   |
| Effect of distributions recorded as compensation expense(b)                                                           |   |                          | — |   |   |   | — |   |   |   | — |   |   |   | 0.02 |   |   |   | 0.04 |   |
| Net decrease in net assets resulting from distributions                                                               |   |                          | — |   |   |   | (0.71 | ) |   |   | (1.74 | ) |   |   | (1.54 | ) |   |   | (1.48 | ) |
| Net increase (decrease) in net assets relating to stock-based transactions                                            |   |                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Issuance of shares of common stock                                                                                    |   |                          | — |   |   |   | (0.50 | ) |   |   | 2.91 |   |   |   | 2.45 |   |   |   | 2.35 |   |
| Issuance of shares of restricted common stock(e)                                                                      |   |                          | — |   |   |   | (0.35 | ) |   |   | (2.83 | ) |   |   | (2.54 | ) |   |   | (2.14 | ) |
| Net increase in stockholders’ equity from restricted stock amortization                                         |   |                          | 0.11    |   |   |   | 0.10 |   |   |   | 0.14 |   |   |   | 0.06 |   |   |   | 0.09 |   |
| Net (decrease) increase in stockholders’ equity from other stock transactions(b)                                |   |                          | (0.03   | ) |   |   | 0.04 |   |   |   | 0.10 |   |   |   | 0.16 |   |   |   | 0.10 |   |
| Net increase (decrease) in net assets relating to share issuances                                                     |   |                          | 0.08    |   |   |   | (0.71 | ) |   |   | 0.32 |   |   |   | 0.13 |   |   |   | 0.40 |   |
| Net asset value at end of year(a)                                                                                     |   | $                             | 8.06    |   |   | $ | 8.66 |   |   | $ | 12.73 |   |   | $ | 12.83 |   |   | $ | 12.48 |   |
| Market price per share at end of year                                                                                 |   | $                             | 4.32    |   |   | $ | 0.71 |   |   | $ | 11.59 |   |   | $ | 20.32 |   |   | $ | 14.59 |   |
| Total return(f)                                                                                                       |   |                          | 508.45  | % |   |   | (87.75 | )% |   |   | (34.30 | )% |   |   | 50.79 | % |   |   | (5.02 | )% |
| Shares of common stock outstanding                                                                                    |   |                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted-average (diluted)(c)                                                                                         |   |                          | 74,692  |   |   |   | 72,254 |   |   |   | 65,606 |   |   |   | 57,222 |   |   |   | 50,996 |   |
| End of year                                                                                                           |   |                          | 76,394  |   |   |   | 76,075 |   |   |   | 65,587 |   |   |   | 58,694 |   |   |   | 53,372 |   |
| Net Assets                                                                                                            |   |                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Average                                                                                                               |   | $                             | 620,243 |   |   | $ | 788,036 |   |   | $ | 800,127 |   |   | $ | 680,282 |   |   | $ | 593,892 |   |
| End of year                                                                                                           |   | $                             | 615,683 |   |   | $ | 658,911 |   |   | $ | 834,689 |   |   | $ | 753,137 |   |   | $ | 666,087 |   |
| Ratio                                                                                                                 |   |                          |    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Operating expenses to average net assets                                                                              |   |                          | 9.94    | % |   |   | 10.06 | % |   |   | 10.65 | % |   |   | 10.40 | % |   |   | 9.94 | % |
| Net operating income to average net assets                                                                            |   |                          | 6.16    | % |   |   | 7.12 | % |   |   | 12.74 | % |   |   | 12.30 | % |   |   | 10.19 | % |

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| (a) | Based on total shares outstanding. |
|-----|------------------------------------|

| (b) | Based on weighted-average shares outstanding. |
|-----|-----------------------------------------------|

| (c) | In accordance with ASC 260, we adjusted the weighted-average basic and diluted common shares outstanding for the three months ended March 31, 2008 to include participating restricted shares of common stock that received non-forfeitable dividends.  See Note 12—(Loss) Earnings Per Share for additional information.  The implementation of this standard did not change our previously reported earnings per share. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | The effect on distributions of stock offerings after record dates represents the effect on net asset value of issuing additional shares after the record date of a distribution. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (e) | Represents the effects of shares issued during the period and the lapsing of forfeiture provisions on restricted stock on earnings per share. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------|

| (f) | Total return = [(ending market price per share – beginning market price per share + dividends paid per share) / beginning market price]. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                                                                           |   | 2009 Quarters |   |   | 2008 Quarters |   |
|----------------------------------------------------------------------------------------------------------------|--------|---------------|--------|--------|---------------|--------|
| (in thousands, except per share amounts)                                                                       |   | Fourth        |   |   | Third         |   |   | Second |   |   | First |   |   | Fourth |   |   | Third |   |   | Second |   |   | First |   |
| Income Statement Data                                                                                          |   |          |   |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Revenue                                                                                                        |   | $             | 23,679 |   |          | $      | 23,611 |   |   | $ | 24,738 |   |   | $ | 27,806 |   |   | $ | 29,973 |   |   | $ | 31,296 |   |   | $ | 31,100 |   |   | $ | 42,996 |   |
| Net operating income before investment loss, gain on extinguishment of debt and income tax (benefit) provision |   |          | 9,419  |   |          |   | 8,658 |   |   |   | 8,173 |   |   |   | 11,938 |   |   |   | 8,860 |   |   |   | 13,014 |   |   |   | 12,950 |   |   |   | 21,266 |   |
| Net income (loss)                                                                                              |   | $             | 1,565  |   |          | $      | 4,183 |   |   | $ | (5,861 | ) |   | $ | (50,946 | ) |   | $ | (57,297 | ) |   | $ | (66,946 | ) |   | $ | (69,500 | ) |   | $ | 2,498 |   |
| Earnings (loss) per common share—basic and diluted(a)                                                    |   | $             | 0.02   |   |          | $      | 0.06 |   |   | $ | (0.08 | ) |   | $ | (0.68 | ) |   | $ | (0.77 | ) |   | $ | (0.90 | ) |   | $ | (0.96 | ) |   | $ | 0.04 |   |
| Weighted-average common shares outstanding—basic and diluted(a)                                          |   |          | 76,267 |   |          |   | 75,876 |   |   |   | 74,592 |   |   |   | 74,498 |   |   |   | 74,424 |   |   |   | 74,296 |   |   |   | 72,310 |   |   |   | 68,847 |   |

| (a) | In accordance with ASC 260, we adjusted the weighted-average basic and diluted common shares outstanding for the three months ended March 31, 2008 to include participating restricted shares of common stock that received non-forfeitable dividends.  See Note 12—(Loss) Earnings Per Share for additional information.  The implementation of this standard did not change our previously reported earnings (loss) per share. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 1. | Disclosure Controls and Procedures. |
|----|-------------------------------------|

| 2. | Internal Control Over Financial Reporting. |
|----|--------------------------------------------|

|   | · | pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company; |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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PA

It

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| Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. |
|----------|-------------------------------------------------------------------------------------------------|

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|   |                                                                                                  |      |
|--------|-------------------------------------------------------------------------------------------------------|-----------|
|   |                                                                                                  | Page      |
| 1.     | The following financial statements are filed herewith:                                                |      |
|   | Reports of Independent Registered Public Accounting Firm                                              | 77        |
|   | Consolidated Balance Sheets as of December 31, 2009 and 2008                                          | 79        |
|   | Consolidated Statements of Operations for the years ended December 31, 2009, 2008 and 2007            | 81        |
|   | Consolidated Statements of Changes in Net Assets for the years ended December 31, 2009, 2008 and 2007 | 81        |
|   | Consolidated Statements of Cash Flows for the years ended December 31, 2009, 2008 and 2007            | 82        |
|   | Consolidated Schedule of Investments as of December 31, 2009                                          | 83        |
|   | Consolidated Schedule of Investments as of December 31, 2008                                          | 88        |
|   | Notes to Consolidated Financial Statements                                                            | 93        |
| 2.     | The following financial statement schedules are filed herewith:                                       |      |
|   |         Schedule 12-14 Investments in and Advances to Affiliates   |  130 |
| 3.     | Exhibits required to be filed by Item 601 of Regulation S-K                                           | 132       |

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| MCG Capital Corporation                               |                                      |
|-------------------------------------------------------|-------------------------------------------|
| Schedule of Investments in and Advances to Affiliates |                                      |
|                                                  |                                      |
|                                                  |                                      |   | Year Ended |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (in thousands)                                        |                                      |   | December 31, 2009 |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Portfolio Company                                     | Investment(a)                             |   | Amount of Interest or Dividends Credited to Income(f) |   |   | As of December 31, 2008 Fair Value |   |   | Gross Additions(b) |   |   | Gross Reductions(c) |   |   | As of December 31, 2009 Fair Value |   |
| Control Investments: Majority-owned                   |                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Avenue Broadband LLC                                  | Subordinated Debt                         |   | $ | 2,007 |   |   | $ | 13,619 |   |   | $ | 730 |   |   | $ | — |   |   | $ | 14,349 |   |
|                                                  | Preferred Units                           |   |   | 1,919 |   |   |   | 25,992 |   |   |   | 609 |   |   |   | — |   |   |   | 26,601 |   |
|                                                  | Warrants to purchase Class B Common Stock |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Broadview Networks Holdings, Inc.                     | Series A Preferred Stock                  |   |   | — |   |   |   | 70,666 |   |   |   | — |   |   |   | (527 | ) |   |   | 70,139 |   |
|                                                  | Series A-1 Preferred Stock                |   |   | — |   |   |   | 68,659 |   |   |   | 36 |   |   |   | — |   |   |   | 68,695 |   |
|                                                  | Class A Common Stock                      |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Cleartel Communications, Inc.                         | Subordinated Debt                         |   |   | — |   |   |   | — |   |   |   | 2,351 |   |   |   | (2,351 | ) |   |   | — |   |
|                                                  | Series B Preferred Stock                  |   |   | — |   |   |   | — |   |   |   | 50,613 |   |   |   | (50,613 | ) |   |   | — |   |
|                                                  | Common Stock                              |   |   | — |   |   |   | — |   |   |   | 62,125 |   |   |   | (62,125 | ) |   |   | — |   |
| Coastal Sunbelt, LLC                                  | Senior Debt                               |   |   | 1,717 |   |   |   | 22,127 |   |   |   | 124 |   |   |   | (22,251 | ) |   |   | — |   |
|                                                  | Subordinated Debt                         |   |   | 310 |   |   |   | 8,115 |   |   |   | 235 |   |   |   | (8,350 | ) |   |   | — |   |
|                                                  | Preferred LLC Interest                    |   |   | 865 | (f) |   |   | 14,648 |   |   |   | 865 |   |   |   | (15,513 | ) |   |   | — |   |
|                                                  | Warrants to purchase Class B Common Stock |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| GMC Television Broadcasting, LLC                      | Senior Debt                               |   |   | 252 |   |   |   | 22,520 |   |   |   | 219 |   |   |   | (1,239 | ) |   |   | 21,500 |   |
|                                                  | Subordinated Debt(d)                      |   |   | — |   |   |   | 5,465 |   |   |   | — |   |   |   | (5,465 | ) |   |   | — |   |
|                                                  | Subordinated Unsecured Debt(d)            |   |   | — |   |   |   | — |   |   |   | 1,000 |   |   |   | (1,000 | ) |   |   | — |   |
|                                                  | Class B Voting Units                      |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Intran Media, LLC                                     | Senior Debt                               |   |   | 929 |   |   |   | 8,888 |   |   |   | 338 |   |   |   | (300 | ) |   |   | 8,926 |   |
|                                                  | Preferred A Units                         |   |   | — |   |   |   | 1,956 |   |   |   | — |   |   |   | (626 | ) |   |   | 1,330 |   |
|                                                  | Preferred B Units                         |   |   | — |   |   |   | 1,096 |   |   |   | — |   |   |   | (937 | ) |   |   | 159 |   |
| Jet Plastica Investors, LLC                           | Senior Debt                               |   |   | 1,116 |   |   |   | — |   |   |   | 12,561 |   |   |   | (120 | ) |   |   | 12,441 |   |
|                                                  | Subordinated Debt(e)                      |   |   | 3,834 |   |   |   | 29,947 |   |   |   | 2,417 |   |   |   | (2,018 | ) |   |   | 30,346 |   |
|                                                  | Preferred LLC Interest                    |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| JetBroadband Holdings, LLC                            | Subordinated Debt                         |   |   | 3,929 |   |   |   | 25,577 |   |   |   | 2,863 |   |   |   | — |   |   |   | 28,440 |   |
|                                                  | Series A Preferred Stock                  |   |   | — |   |   |   | — |   |   |   | 11,809 |   |   |   | — |   |   |   | 11,809 |   |
|                                                  | Series B Preferred Stock                  |   |   | — |   |   |   | — |   |   |   | 10,000 |   |   |   | — |   |   |   | 10,000 |   |
|                                                  | Preferred LLC                             |   |   | — |   |   |   | 16,562 |   |   |   | — |   |   |   | (16,562 | ) |   |   | — |   |
| LMS INTELLIBOUND, INC.                                | Senior Debt                               |   |   | 386 |   |   |   | 11,223 |   |   |   | 20,912 |   |   |   | (32,135 | ) |   |   | — |   |
|                                                  | Subordinated Debt                         |   |   | 427 | (f) |   |   | 16,882 |   |   |   | 81 |   |   |   | (16,963 | ) |   |   | — |   |
|                                                  | Preferred Units                           |   |   | 175 |   |   |   | 38,845 |   |   |   | 16,684 |   |   |   | (55,529 | ) |   |   | — |   |
|                                                  | Warrants to purchase Class B Common Stock |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| MTP Holding, LLC                                      | Common LLC Interest                       |   |   | — |   |   |   | 28 |   |   |   | — |   |   |   | — |   |   |   | 28 |   |
| Orbitel Holdings, LLC                                 | Senior Debt                               |   |   | 1,524 |   |   |   | 16,192 |   |   |   | 33 |   |   |   | — |   |   |   | 16,225 |   |
|                                                  | Preferred LLC Interest                    |   |   | 672 |   |   |   | 11,597 |   |   |   | 672 |   |   |   | (18 | ) |   |   | 12,251 |   |
| PremierGarage Holdings, LLC                           | Senior Debt(d)                            |   |   | 232 |   |   |   | 7,832 |   |   |   | 2,774 |   |   |   | (719 | ) |   |   | 9,887 |   |
|                                                  | Preferred LLC Units                       |   |   | — |   |   |   | — |   |   |   | 810 |   |   |   | (521 | ) |   |   | 289 |   |
|                                                  | Common LLC Units                          |   |   | — |   |   |   | — |   |   |   | 521 |   |   |   | (521 | ) |   |   | — |   |
| RadioPharmacy Investors, LLC                          | Senior Debt                               |   |   | 1,782 |   |   |   | 8,469 |   |   |   | 15 |   |   |   | — |   |   |   | 8,484 |   |
|                                                  | Subordinated Debt                         |   |   | 373 |   |   |   | 9,793 |   |   |   | 318 |   |   |   | — |   |   |   | 10,111 |   |
|                                                  | Preferred LLC Interest                    |   |   | — |   |   |   | 3,479 |   |   |   | — |   |   |   | (3,410 | ) |   |   | 69 |   |
| Superior Industries Investors, LLC                    | Subordinated Debt                         |   |   | 2,903 |   |   |   | 17,920 |   |   |   | 2,206 |   |   |   | — |   |   |   | 20,126 |   |
|                                                  | Preferred Units                           |   |   | 294 |   |   |   | 18,611 |   |   |   | 366 |   |   |   | — |   |   |   | 18,977 |   |
| TNR Holdings Corp.                                    | Senior Debt                               |   |   | — |   |   |   | 1,708 |   |   |   | 292 |   |   |   | (2,000 | ) |   |   | — |   |
|                                                  | Series A Preferred Stock                  |   |   | — |   |   |   | 25,682 |   |   |   | 18,088 |   |   |   | (43,770 | ) |   |   | — |   |
|                                                  | Common Stock                              |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
|                                                  | Legacy Series A Preferred Stock           |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
|                                                  | Legacy Common Stock                       |   |   | — |   |   |   | — |   |   |   | 3,000 |   |   |   | (3,000 | ) |   |   | — |   |
|                                                  | Warrants to purchase Common Stock         |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
|                                                  | Warrants to purchase Legacy Common Stock  |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Total Sleep Holdings, Inc.                            | Subordinated Debt(d)                      |   |   | 1,231 |   |   |   | 26,540 |   |   |   | 3,346 |   |   |   | (24,615 | ) |   |   | 5,271 |   |
|                                                  | Series A Preferred Stock                  |   |   | — |   |   |   | — |   |   |   | 21,149 |   |   |   | (21,149 | ) |   |   | — |   |
|                                                  | Common Stock                              |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | — |   |
| Total Control Investments: Majority-owned             |                                      |   | 26,877 |   |   |   | 550,638 |   |   |   | 250,162 |   |   |   | (394,347 | ) |   |   | 406,453 |   |

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|                                          |                                 |   | Year Ended                                            |    |   |                                    |   |    |               |   |   |                |   |   |                                    |     |
|-----------------------------------------------|--------------------------------------|--------|-------------------------------------------------------|---------|--------|-----------------------------------------|--------|---------|--------------------|--------|--------|---------------------|--------|--------|-----------------------------------------|----------|
| (in thousands)                                |                                 |   | December 31, 2009                                |    |   |                                    |   |    |               |   |   |                |   |   |                                    |     |
| Portfolio Company                             | Investment(a)                        |   | Amount of Interest or Dividends Credited to Income(f) |    |   | As of December 31, 2008 Fair Value |   |    | Gross Additions(b) |   |   | Gross Reductions(c) |   |   | As of December 31, 2009 Fair Value |     |
| Control Investments: Non-majority owned       |                                 |   |                                                  |    |   |                                    |   |    |               |   |   |                |   |   |                                    |
| Crystal Media Network, LLC                    | LLC Interest                         |   | $                                                     | — |   |                                    | $      | 2,556   |               |   | $      | 109                 |   |   | $                                       | (2,665   | ) |   | $ | — |   |
| National Product Services, Inc.               | Senior Debt                          |   |                                                  | 1,750   |   |                                    |   | 9,492   |               |   |   | 6,594               |   |   |                                    | (12,555  | ) |   |   | 3,531 |   |
|                                          | Subordinated Debt                    |   |                                                  | — |   |                                    |   | — |               |   |   | 35                  |   |   |                                    | (35      | ) |   |   | — |   |
|                                          | Series A Preferred Stock             |   |                                                  | — |   |                                    |   | — |               |   |   | 10,731              |   |   |                                    | (10,731  | ) |   |   | — |   |
|                                          | Series B Preferred Stock             |   |                                                  | — |   |                                    |   | — |               |   |   | —             |   |   |                                    | —  |   |   |   | — |   |
|                                          | Common Stock                         |   |                                                  | — |   |                                    |   | — |               |   |   | —             |   |   |                                    | —  |   |   |   | — |   |
| Total Control Investments: Non-majority owned |                                 |   | 1,750                                                 |    |   |                                    | 12,048 |    |               |   | 17,469 |                |   |   | (25,986                                 | )        |   |   | 3,531 |   |
| Total Control Investments                     |                                 |   | $                                                     | 28,627  |   |                                    | $      | 562,686 |               |   | $      | 267,631             |   |   | $                                       | (420,333 | ) |   | $ | 409,984 |   |
| Affiliate Investments                         |                                 |   |                                                  |    |   |                                    |   |    |               |   |   |                |   |   |                                    |     |   |   |   |   |   |
| Advanced Sleep Concepts, Inc.                 | Senior Debt                          |   | $                                                     | 924     |   |                                    | $      | 5,629   |               |   | $      | 208                 |   |   | $                                       | (210     | ) |   | $ | 5,627 |   |
|                                          | Subordinated Debt                    |   |                                                  | 850     |   |                                    |   | 4,426   |               |   |   | 391                 |   |   |                                    | —  |   |   |   | 4,817 |   |
|                                          | Series A Preferred Stock             |   |                                                  | — |   |                                    |   | — |               |   |   | —             |   |   |                                    | —  |   |   |   | — |   |
|                                          | Common Stock                         |   |                                                  | — |   |                                    |   | — |               |   |   | —             |   |   |                                    | —  |   |   |   | — |   |
|                                          | Warrants to purchase Common Stock    |   |                                                  | — |   |                                    |   | — |               |   |   | —             |   |   |                                    | —  |   |   |   | — |   |
|  Cherry Hill Holdings Inc.               | Series A Preferred Stock             |   |                                                  | — |   |                                    |   | 878     |               |   |   | 28                  |   |   |                                    | —  |   |   |   | 906 |   |
| Stratford School Holdings, Inc.               | Senior Debt                          |   |                                                  | 327     |   |                                    |   | 3,634   |               |   |   | 29                  |   |   |                                    | (295     | ) |   |   | 3,368 |   |
|                                          | Subordinated Debt                    |   |                                                  | 965     |   |                                    |   | 6,683   |               |   |   | 285                 |   |   |                                    | (273     | ) |   |   | 6,695 |   |
|                                          | Series A Convertible Preferred Stock |   |                                                  | 120     |   |                                    |   | 12,842  |               |   |   | 90                  |   |   |                                    | (6,097   | ) |   |   | 6,835 |   |
|                                          | Warrants to purchase Common Stock    |   |                                                  | — |   |                                    |   | 3,903   |               |   |   | —             |   |   |                                    | (2,057   | ) |   |   | 1,846 |   |
| Sunshine Media Delaware, LLC                  | Common Stock                         |   |                                                  | — |   |                                    |   | — |               |   |   | —             |   |   |                                    | —  |   |   |   | — |   |
|                                          | Class A LLC Interest                 |   |                                                  | — |   |                                    |   | — |               |   |   | —             |   |   |                                    | —  |   |   |   | — |   |
| Velocity Technology Enterprises, Inc.         | Senior Debt                          |   |                                                  | 1,284   |   |                                    |   | 16,204  |               |   |   | 547                 |   |   |                                    | (3,957   | ) |   |   | 12,794 |   |
|                                          | Series A Preferred Stock             |   |                                                  | — |   |                                    |   | 1,500   |               |   |   | —             |   |   |                                    | —  |   |   |   | 1,500 |   |
| XFone, Inc.                                   | Common Stock                         |   |                                                  | — |   |                                    |   | 419     |               |   |   | 1,976               |   |   |                                    | (2,395   | ) |   |   | — |   |
|                                          | Warrants to purchase Common Stock    |   |                                                  | — |   |                                    |   | 8       |               |   |   | —             |   |   |                                    | (8       | ) |   |   | — |   |
| Total Affiliate Investments                   |                                 | $      | 4,470                                                 |    |   | $                                       | 56,126 |    |               | $      | 3,554  |                |   | $      | (15,292                                 | )        |   | $ | 44,388 |   |

| (a) | Common stock, warrants, options and equity interests are generally non-income producing and restricted.  In some cases, preferred stock may also be non-income producing.  The principal amount for debt and the number of shares of common stock and preferred stock is shown in the Consolidated Schedule of Investments as of December 31, 2009. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (b) | Gross additions include increases in investments resulting from new portfolio company investments, paid-in-kind interest or dividends, the amortization of discounts and fees, and the exchange of one or more existing securities for one or more new securities.  Gross additions also include net increases in unrealized appreciation or net decreases in unrealized depreciation. |
|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (c) | Gross reductions include decreases in investments resulting from principal collections related to investment repayments or sales and the exchange of one or more existing securities for one or more new securities.  Gross reductions also include net increases in unrealized depreciation or net decreases in unrealized appreciation. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (d) | All or part of this debt is on non-accrual status as of December 31, 2009, and, therefore; is considered non-income producing. |
|-----|--------------------------------------------------------------------------------------------------------------------------------|

| (e) | We did not recognize paid-in-kind interest or accretion income during one or more quarters in 2009, including the quarter ended December 31, 2009, because the fair value of our investment was below its cost basis.  However, we continue to accrue interest that is receivable in cash from the portfolio company. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (f) | Represents the total amount of interest or dividends credited to income for the portion of the year an investment was a control investment (more than 25% owned) or an affiliate investment (5% to 25% owned), respectively.  All dividend income is non-cash unless otherwise noted. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (g) |  Cash dividend. |
|-----|----------------------|

| ** | Information related to the amount of equity in the net profit and loss for the period for the investments listed has not been included in this schedule.  This information is not considered to be meaningful due to the complex capital structures of the portfolio companies, with different classes of equity securities outstanding with different preferences in liquidation.  These investments are neither consolidated nor accounted for under the equity method of accounting. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Table of Contents

|        |                                                                                                                                                                                                                                                             | Incorporated by Reference |                 |
|-------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------|----------------------|
| Exhibit No. | Description                                                                                                                                                                                                                                                      | Form and SEC File No.     | Filing Date with SEC | Exhibit No. | Filed with this 10-K |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
|        | Certificate of Incorporation and Bylaws                                                                                                                                                                                                                          |                      |                 |   |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
| 3.1         | Restated Certificate of Incorporation of MCG Capital Corporation                                                                                                                                                                                                 | 8-K(0-33377)              | May 31, 2005         | 3.1 |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
| 3.2         | Amended and Restated Bylaws of MCG Capital Corporation                                                                                                                                                                                                           | 8-K(0-33377)              | October 30, 2009     | 3.1 |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
|        | Instruments Defining the Rights of Security Holders                                                                                                                                                                                                              |                      |                 |   |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
| 4.1         | Specimen Common Stock Certificate                                                                                                                                                                                                                                | N-2(333-64596)            | November 1, 2001     | 99.d.1 |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
| 4.2         | Third Amended and Restated Registration Rights Agreement by and among MCG Capital Corporation and certain stockholders                                                                                                                                           | 10-K (0-33377)            | April 1, 2002        | 10.1 |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
|        | Material Contracts—Purchase, Financing and Credit Agreements                                                                                                                                                                                               |                      |                 |   |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
| 10.1        | Corporate Custodial Agreement between MCG Capital Corporation and Riggs Bank, N.A.                                                                                                                                                                               | 10-K(0-33377)             | April 1, 2002        | 10.45 |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
| 10.2        | Amended and Restated Custody Agreement by and between MCG Capital Corporation and Wells Fargo Bank, National Association, dated December 11, 2008                                                                                                                | 10-K(0-33377)             | March 9, 2009        | 10.2 |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
| 10.3        | Amended and Restated Sale and Servicing Agreement by and among MCG Capital Corporation, MCG Commercial Loan Funding Trust, Three Pillars Funding LLC, SunTrust Robinson Humphrey, Inc. and Wells Fargo Bank, National Association, dated as of February 26, 2009 | 8-K(0-33377)              | February 27, 2009    | 10.2 |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
| 10.4        | Indenture by and between MCG Commercial Loan Trust 2006-1 and Wells Fargo Bank, National Association, dated as of April 18, 2006                                                                                                                                 | N-2(333-133669)           | May 1, 2006          | 99.f.24 |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
| 10.5        | Collateral Management Agreement, by and between MCG Commercial Loan Trust 2006-1 and MCG Capital Corporation, dated as of April 18, 2006                                                                                                                         | N-2(333-133669)           | May 1, 2006          | 99.f.25 |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
| 10.6        | Class A-2 Note Purchase Agreement by and among MCG Commercial Loan Trust 2006-1 and Wells Fargo Bank, National Association, dated as of April 18, 2006                                                                                                           | N-2(333-133669)           | May 1, 2006          | 99.f.26 |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
| 10.7        | Class A-3 Note Purchase Agreement, by and among MCG Commercial Loan Trust 2006-1, North Sea Funding Europe Asset Purchasing Company No. 1 B.V. and Wells Fargo Bank, National Association, dated as of April 18, 2006                                            | N-2(333-133669)           | May 1, 2006          | 99.f.27 |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
| 10.8        | Class A-3 Note Purchase Agreement by and among MCG Commercial Loan Trust 2006-1, Barclays Bank PLC and Wells Fargo Bank, National Association, dated as of April 18, 2006                                                                                        | N-2(333-133669)           | May 1, 2006          | 99.f.28 |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
| 10.9        | Note Purchase Agreement by and among MCG Capital Corporation and the Purchasers of 6.73% Senior Notes listed therein, dated as of October 11, 2005                                                                                                               | 8-K(0-33377)              | October 12, 2005     | 99.1 |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
| 10.10       | First Amendment to the Note Purchase Agreement by and among MCG Capital Corporation and the Holders of 6.73% Senior Notes under the October 11, 2005 Note Purchase Agreement, dated as of February 26, 2009                                                      | 8-K(0-33377)              | February 27, 2009    | 10.3 |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
| 10.11       | Second Amendment Agreement by and among MCG Capital Corporation and the Holders of 6.73% Senior Notes under the October 11, 2005 Note Purchase Agreement, dated as of October 28, 2009                                                                           | 8-K(0-33377)              | October 29, 2009     | 10.1 |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
| 10.12       | Note Purchase Agreement by and among MCG Capital Corporation and the Purchasers of 6.71% Senior Notes listed therein, dated as of October 3, 2007                                                                                                                | 8-K(0-33377)              | October 9, 2007      | 99.1 |   |
|        |                                                                                                                                                                                                                                                             |                      |                 |   |   |
| 10.13       | First Amendment to the Note Purchase Agreement by and among MCG Capital Corporation and the Holders of 6.71% Senior Notes under the October 3, 2007 Note Purchase Agreement, dated as of February 26, 2009                                                       | 8-K(0-33377)              | February 27, 2009    | 10.4 |   |

----

Table of Contents

|        |                                                                                                                                                                                  | Incorporated by Reference |                 |
|-------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------|----------------------|
| Exhibit No. | Description                                                                                                                                                                           | Form and SEC File No.     | Filing Date with SEC | Exhibit No. | Filed with this 10-K |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.14       | Second Amendment Agreement by and among MCG Capital Corporation and the Holders of 6.71% Senior Notes under the October 3, 2007 Note Purchase Agreement, dated as of October 28, 2009 | 8-K(0-33377)              | October 29, 2009     | 10.2 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
|        | Material Contracts—Leases                                                                                                                                                       |                      |                 |   |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.15       | Deed of Lease by and between Twin Towers II Associates Limited Partnership, as landlord, and MCG Capital Corporation, as tenant, dated as of September 24, 2002                       | 10-Q(0-33377)             | November 14, 2002    | 10.50 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.16       | First Amendment to Deed of Lease by and between Twin Towers II Property Associates, LLC, as landlord and MCG Capital Corporation, as tenant, dated as of November 30, 2006            | 10-K(0-33377)             | March 1, 2007        | 10.73 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.17       | Partial Termination of Deed of Lease by and between 1000-1100 Wilson Owner, LLC, as landlord and MCG Capital Corporation, as tenant, dated as of November 15, 2008                    | 10-K(0-33377)             | March 9, 2009        | 10.24 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
|        | Material Contracts—Management Contracts and Compensation Plans                                                                                                                  |                      |                 |   |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.18#      | MCG Capital Corporation Supplemental Non-Qualified Retirement Plan Amended and Restated as of January 1, 2005                                                                         | 10-Q(0-33377)             | November 7, 2006     | 10.70 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.19#      | Amendment to the MCG Capital Corporation Supplemental Non-Qualified Retirement Plan, Amended and Restated as of January 1, 2005, dated as of December 30, 2008                        | 10-K(0-33377)             | March 9, 2009        | 10.26 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.20#      | MCG Capital Corporation 401(k) Plan                                                                                                                                                   | N-2(333-64596)            | July 5, 2001         | 99.i.1 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.21#      | MCG Capital Corporation Dividend Reinvestment Plan                                                                                                                                    | N-2(333-64596)            | November 1, 2001     | 99.e |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.22#      | MCG Capital Corporation Amended and Restated 2006 Non-Employee Director Restricted Stock Plan                                                                                         | 8-K(0-33377)              | May 7, 2008          | 99.2 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.23#      | MCG Capital Corporation Amended and Restated 2006 Employee Restricted Stock Plan                                                                                                      | 8-K(0-33377)              | May 7, 2008          | 99.1 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.24#      | Form of Restricted Stock Agreement for Non-Employee Members of the Board of Directors (pursuant to the Amended and Restated 2006 Non-Employee Director Restricted Stock Plan)         | 10-K(0-33377)             | March 1, 2007        | 10.75 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.25#      | Form of Restricted Stock Agreement for Employees (pursuant to the Amended and Restated 2006 Employee Restricted Stock Plan)                                                           | 10-K(0-33377)             | March 9, 2009        | 10.34 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.26#      | Restricted Stock Agreement by and between MCG Capital Corporation and Robert J. Merrick, dated November 21, 2006                                                                      | 10-K(0-33377)             | March 9, 2009        | 10.35 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.27#      | Restricted Stock Agreement by and between MCG Capital Corporation and Steven F. Tunney, dated November 21, 2006                                                                       | 10-K(0-33377)             | March 9, 2009        | 10.36 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.28#      | Restricted Stock Agreement by and between MCG Capital Corporation and B. Hagen Saville, dated November 21, 2006                                                                       | 10-K(0-33377)             | March 9, 2009        | 10.37 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.29#      | MCG Capital Corporation 2008 Retention Program                                                                                                                                        | 10-Q(0-33377)             | August 8, 2008       | 10.3 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.30#      | Form of Restricted Stock Agreement for MCG Employees under 2008 Retention Program                                                                                                     | 10-Q(0-33377)             | October 31, 2008     | 10.3 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.31#      | Employment Agreement by and between MCG Capital Corporation and Steven F. Tunney, dated as of September 18, 2006                                                                      | 8-K(0-33377)              | September 19, 2006   | 10.1 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.32#      | Amendment to Employment Agreement by and between MCG Capital Corporation and Steven F. Tunney, dated as of December 23, 2008                                                          | 10-K(0-33377)             | March 9, 2009        | 10.41 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.33#      | Employment Agreement by and between MCG Capital Corporation and B. Hagen Saville, dated as of September 18, 2006                                                                      | 8-K(0-33377)              | September 19, 2006   | 10.2 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.34#      | Amendment to Employment Agreement by and between MCG Capital Corporation and B. Hagen Saville, dated as of December 31, 2008                                                          | 10-K(0-33377)             | March 9, 2009        | 10.43 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.35#      | Employment Agreement by and between MCG Capital Corporation and Robert J. Merrick, dated as of September 18, 2006                                                                     | 8-K(0-33377)              | September 19, 2006   | 10.3 |   |
|        |                                                                                                                                                                                  |                      |                 |   |   |
| 10.36#      | Amendment to Employment Agreement by and between MCG Capital Corporation and Robert J. Merrick, dated as of December 23, 2008                                                         | 10-K(0-33377)             | March 9, 2009        | 10.45 |   |

----

Table of Contents

|        |                                                                                                                                                                                                                                                                                       | Incorporated by Reference |                 |
|-------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------|----------------------|
| Exhibit No. | Description                                                                                                                                                                                                                                                                                | Form and SEC File No.     | Filing Date with SEC | Exhibit No. | Filed with this 10-K |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| 10.37#      | Employment Agreement by and between MCG Capital Corporation and Samuel G. Rubenstein, dated as of March 1, 2007                                                                                                                                                                            | 10-K(0-33377)             | March 1, 2007        | 10.74 |   |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| 10.38#      | Amendment to Employment Agreement by and between MCG Capital Corporation and Samuel G. Rubenstein, dated as of December 23, 2008                                                                                                                                                           | 10-K(0-33377)             | March 9, 2009        | 10.47 |   |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| 10.39#      | Employment Agreement by and between MCG Capital Corporation and Stephen J. Bacica, dated as of October 28, 2008                                                                                                                                                                            | 10-Q(0-33377)             | October 31, 2008     | 10.2 |   |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| 10.40#      | Amendment to Employment Agreement by and between MCG Capital Corporation and Stephen J. Bacica, dated as of December 23, 2008                                                                                                                                                              | 10-K(0-33377)             | March 9, 2009        | 10.50 |   |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| 10.41#      | MCG Capital Corporation 2009 Annual Incentive Cash Bonus Plan                                                                                                                                                                                                                              | 8-K(0-33377)              | July 24, 2009        | 10.1 |   |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| 10.42#      | MCG Capital Corporation 2009 Long-Term Incentive Program                                                                                                                                                                                                                                   | 8-K(0-33377)              | July 24, 2009        | 10.2 |   |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| 10.43#      | Non-Employee Director Compensation Summary                                                                                                                                                                                                                                                 |                      |                 |   | * |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
|        | Material Contracts—Other                                                                                                                                                                                                                                                             |                      |                 |   |   |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| 10.44       | Settlement Agreement by and among Springbok Capital Management, LLC, Springbok Capital Onshore, LLC, Gavin Saitowitz, Soundpost Partners, LP, Jaime Lester, Lyrical Partners, L.P., Jeffrey Keswin, Edward Gage, Robert S. Everett and MCG Capital Corporation, dated as of April 24, 2009 | 8-K(0-33377)              | April 28, 2009       | 10.1 |   |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
|        | Subsidiaries of the Registrant                                                                                                                                                                                                                                                             |                      |                 |   |   |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| 21          | Subsidiaries of MCG Capital Corporation and Jurisdiction of Incorporation/Organization                                                                                                                                                                                                     |                      |                 |   | * |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
|        | Consents of Experts                                                                                                                                                                                                                                                                        |                      |                 |   |   |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| 23.1        | Consent of Ernst & Young LLP, independent registered public accounting firm                                                                                                                                                                                                            |                      |                 |   | * |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
|        | Certifications                                                                                                                                                                                                                                                                             |                      |                 |   |   |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| 31.1        | Certification of Chief Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of Sarbanes-Oxley Act of 2002                                                                                 |                      |                 |   | * |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| 31.2        | Certification of Chief Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of Sarbanes-Oxley Act of 2002                                                                                 |                      |                 |   | * |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| 31.3        | Certification of Chief Accounting Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of Sarbanes-Oxley Act of 2002                                                                                |                      |                 |   | * |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| 32.1        | Certification of Chief Executive Officer pursuant to 18 U.S.C.  Section 1350, as adopted pursuant to Section 906 of Sarbanes-Oxley Act of 2002                                                                                                                                   |                      |                 |   | † |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| 32.2        | Certification of Chief Financial Officer pursuant to 18 U.S.C.  Section 1350, as adopted pursuant to Section 906 of Sarbanes-Oxley Act of 2002                                                                                                                                   |                      |                 |   | † |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| 32.3        | Certification of Chief Accounting Officer pursuant to 18 U.S.C.  Section 1350, as adopted pursuant to Section 906 of Sarbanes-Oxley Act of 2002                                                                                                                                  |                      |                 |   | † |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| *           | Filed herewith.                                                                                                                                                                                                                                                                            |                      |                 |   |   |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| †     | Furnished herewith.                                                                                                                                                                                                                                                                        |                      |                 |   |   |
|        |                                                                                                                                                                                                                                                                                       |                      |                 |   |   |
| #           | Management contracts or compensatory plans or arrangements required to be filed as an exhibit herein pursuant to Item 15(a) of Form 10-K.                                                                                                                                                  |                      |                 |   |   |

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Table of Contents

SI

|   | MCG CAPITAL CORPORATION |
|--------|-------------------------|
|   |                    |   |
|   | By:                     | /S/    STEVEN F. TUNNEY |
|   |                    |   |
|   |                    | Steven F. Tunney |
|   |                    | Chief Executive Officer |

| Signature                               |   | Title                                                |   | Date          |
|-----------------------------------------|--------|------------------------------------------------------|--------|---------------|
|                                    |   |                                                 |   |          |
| /s/  Steven F. Tunney         |   | President and Chief Executive Officer, Director      |   |          |
| Steven F. Tunney                        |   | (Principal Executive Officer)                        |   | March 4, 2010 |
|                                    |   |                                                 |   |          |
| /s/  Stephen J. Bacica        |   | Executive Vice President and Chief Financial Officer |   |          |
| Stephen J. Bacica                       |   | (Principal Financial Officer)                        |   | March 4, 2010 |
|                                    |   |                                                 |   |          |
| /s/  Linda A. Nimmons         |   | Senior Vice President and Chief Accounting Officer   |   |          |
| Linda A.  Nimmons             |   | (Principal Accounting Officer)                       |   | March 4, 2010 |
|                                    |   |                                                 |   |          |
| /s/  B. Hagen Saville              |   |                                                 |   |          |
| B. Hagen Saville                        |   | Director and Executive Vice President                |   | March 4, 2010 |
|                                    |   |                                                 |   |          |
| /s/  Richard W. Neu                |   |                                                 |   |          |
| Richard W. Neu                          |   | Chairman of the Board and Director                   |   | March 4, 2010 |
|                                    |   |                                                 |   |          |
| /s/  A. Hugh Ewing, III       |   |                                                 |   |          |
| A. Hugh Ewing, III                      |   | Director                                             |   | March 4, 2010 |
|                                    |   |                                                 |   |          |
| /s/  Kim D. Kelly             |   |                                                 |   |          |
| Kim D. Kelly                            |   | Director                                             |   | March 4, 2010 |
|                                    |   |                                                 |   |          |
| /s/  Wallace B. Millner, III  |   |                                                 |   |          |
| Wallace B. Millner, III                 |   | Director                                             |   | March 4, 2010 |
|                                    |   |                                                 |   |          |
| /s/  Kenneth J. O’Keefe |   |                                                 |   |          |
| Kenneth J. O’Keefe                |   | Director                                             |   | March 4, 2010 |
|                                    |   |                                                 |   |          |
| /s/  Gavin Saitowitz          |   |                                                 |   |          |
| Gavin Saitowitz                         |   | Director                                             |   | March 4, 2010 |

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