##### Table of Contents





UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549





FORM 10-Q





(Mark One)



|þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.
|- | ----------------------------------------------------------------------------------------

For the quarterly period ended March 31, 2015

OR



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

For the transition period from                  to

Commission file number 814-00712

BLACKROCK CAPITAL INVESTMENT CORPORATION

(Exact Name of Registrant as Specified in Its Charter)







|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Delaware                                                       |  | 20-2725151                          
|(State or Other Jurisdiction of
Incorporation or Organization) |  | (I.R.S. Employer
Identification No.)
|                                                               | 
|40 East 52nd Street, New York, NY                              |  | 10022                               
|(Address of Principal Executive Offices)                       |  | (Zip Code)                          

Registrants Telephone Number, Including Area Code: 212-810-5800











Formerly known as BlackRock Kelso
Capital Corporation

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the
past 90 days.    Yes  þ    No   ̈

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such
files).    Yes   ̈    No   ̈

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.



Large accelerated filer
 ̈    Accelerated filer þ    Non-Accelerated filer
 ̈    (Do not check if a smaller reporting company)

Smaller reporting
company  ̈

Indicate by check mark whether the Registrant is a shell company (as defined in
Rule 12b-2 of the Securities Exchange Act of 1934).    Yes   ̈    No  þ

The number of shares of the Registrants common stock, $.001 par value per share, outstanding at April 29, 2015 was 74,775,966









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##### Table of Contents

BLACKROCK CAPITAL INVESTMENT CORPORATION

FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2015

Table of Contents



|           |  |                                                                                                                 |    |          |    | 
|---------- |  | --------------------------------------------------------------------------------------------------------------- | -- | -------- | -- | 
|           |  |                                                                                                                
|           |  | INDEX                                                                                                           |    | PAGE NO. |   
|           |  |                                                                                                                
|PART I.    |  | FINANCIAL INFORMATION                                                                                           |    |          |    | 
|           |  |                                                                                                                
|Item 1.    |  | CONSOLIDATED FINANCIAL INFORMATION                                                                              |    |          |    | 
|           |  |                                                                                                                
|           |  | Consolidated Statements of Assets and Liabilities as of March 31, 2015 and December 31, 2014
(unaudited)        |    |          | 3  | 
|           |  |                                                                                                                
|           |  | Consolidated Statements of Operations for the three months ended March 31, 2015 and 2014
(unaudited)            |    |          | 4  | 
|           |  |                                                                                                                
|           |  | Consolidated Statements of Changes in Net Assets for the three months ended March 31, 2015 and 2014 (unaudited) |    |          | 5  | 
|           |  |                                                                                                                
|           |  | Consolidated Statements of Cash Flows for the three months ended March 31, 2015 and 2014
(unaudited)            |    |          | 6  | 
|           |  |                                                                                                                
|           |  | Consolidated Schedules of Investments as of March 31, 2015 and December 31, 2014 (unaudited)                    |    |          | 7  | 
|           |  |                                                                                                                
|           |  | Notes to Consolidated Financial Statements (unaudited)                                                          |    |          | 21 | 
|           |  |                                                                                                                
|Item 2.    |  | Managements Discussion and Analysis of Financial Condition and Results of Operations                           |    |          | 41 | 
|           |  |                                                                                                                
|Item 3.    |  | Quantitative and Qualitative Disclosures About Market Risk                                                      |    |          | 49 | 
|           |  |                                                                                                                
|Item 4.    |  | Controls and Procedures                                                                                         |    |          | 50 | 
|           |  |                                                                                                                
|PART II.   |  | OTHER INFORMATION                                                                                               |    |          |    | 
|           |  |                                                                                                                
|Item 1.    |  | Legal Proceedings                                                                                               |    |          | 51 | 
|           |  |                                                                                                                
|Item 1A.   |  | Risk Factors                                                                                                    |    |          | 51 | 
|           |  |                                                                                                                
|Item 2.    |  | Unregistered Sales of Equity Securities and Use of Proceeds                                                     |    |          | 51 | 
|           |  |                                                                                                                
|Item 3.    |  | Defaults Upon Senior Securities                                                                                 |    |          | 51 | 
|           |  |                                                                                                                
|Item 4.    |  | Mine Safety Disclosures                                                                                         |    |          | 51 | 
|           |  |                                                                                                                
|Item 5.    |  | Other Information                                                                                               |    |          | 51 | 
|           |  |                                                                                                                
|Item 6.    |  | Exhibits                                                                                                        |    |          | 51 | 
|           | 
|SIGNATURES |  |                                                                                                                 | 52 |         



2



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##### Table of Contents

PART 1. CONSOLIDATED FINANCIAL INFORMATION

In this Quarterly Report, Company, we, us and our refer to BlackRock Capital Investment Corporation unless the
context states otherwise.

Item 1. Consolidated Financial Statements

BlackRock Capital Investment Corporation

Consolidated Statements of Assets and Liabilities

(Unaudited)



|                                                                                                                                                          |  |               |               |   |                  |   |               |  
|--------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------- | ------------- | - | ---------------- | - | ------------- | -
|                                                                                                                                                          |  | March 31,2015 |               |   | December 31,2014 |  
|Assets                                                                                                                                                    |  |               |               |   |                  |   |               |  
|Investments at fair value:                                                                                                                                |  |               |               |   |                  |   |               |  
|Non-controlled, non-affiliated investments (cost of $803,415,960 and $813,962,545)                                                                        |  | $             | 820,890,650   |   |                  | $ | 832,237,704   |  
|Non-controlled, affiliated investments (cost of $85,567,927 and $91,936,084)                                                                              |  |               | 200,593,376   |   |                  |   | 211,155,607   |  
|Controlled investments (cost of $225,233,723 and $228,402,329)                                                                                            |  |               | 214,152,290   |   |                  |   | 214,323,427   |  
|                                                                                                                                                          |  |               |               |   |                  |   |               |  
|Total investments at fair value (cost of $1,114,217,610 and $1,134,300,958)                                                                               |  |               | 1,235,636,316 |   |                  |   | 1,257,716,738 |  
|Cash and cash equivalents                                                                                                                                 |  |               | 45,335,615    |   |                  |   | 10,326,174    |  
|Receivable for investments sold                                                                                                                           |  |               | 11,606,438    |   |                  |   | 10,360,202    |  
|Interest receivable                                                                                                                                       |  |               | 17,798,411    |   |                  |   | 13,419,032    |  
|Prepaid expenses and other assets                                                                                                                         |  |               | 8,532,500     |   |                  |   | 10,233,677    |  
|                                                                                                                                                          |  |               |               |   |                  |   |               |  
|Total Assets                                                                                                                                              |  | $             | 1,318,909,280 |   |                  | $ | 1,302,055,823 |  
|                                                                                                                                                          |  |               |               |   |                  |   |               |  
|Liabilities                                                                                                                                               |  |               |               |   |                  |   |               |  
|Debt                                                                                                                                                      |  | $             | 472,288,395   |   |                  | $ | 448,227,689   |  
|Interest payable                                                                                                                                          |  |               | 3,432,834     |   |                  |   | 7,918,429     |  
|Distributions payable                                                                                                                                     |  |               | 15,681,195    |   |                  |   | 15,655,007    |  
|Base management fees payable                                                                                                                              |  |               | 6,370,630     |   |                  |   | 5,749,219     |  
|Incentive management fees payable                                                                                                                         |  |               | 28,912,677    |   |                  |   | 37,507,592    |  
|Accrued administrative services                                                                                                                           |  |               | 157,595       |   |                  |   | 241,500       |  
|Other accrued expenses and payables                                                                                                                       |  |               | 2,160,963     |   |                  |   | 4,797,219     |  
|                                                                                                                                                          |  |               |               |   |                  |   |               |  
|Total Liabilities                                                                                                                                         |  |               | 529,004,289   |   |                  |   | 520,096,655   |  
|                                                                                                                                                          |  |               |               |   |                  |   |               |  
|Net Assets                                                                                                                                                |  |               |               |   |                  |   |               |  
|Common stock, par value $.001 per share, 200,000,000 common shares authorized, 76,430,935 and 76,306,237 issued and 74,672,320 and
74,547,622 outstanding |  |               | 76,431        |   |                  |   | 76,306        |  
|Paid-in capital in excess of par                                                                                                                          |  |               | 880,931,189   |   |                  |   | 879,959,915   |  
|Distributions in excess of taxable net investment income                                                                                                  |  |               | (16,733,543   | ) |                  |   | (15,675,925   | )
|Accumulated net realized loss                                                                                                                             |  |               | (182,080,574  | ) |                  |   | (190,427,433  | )
|Net unrealized appreciation (depreciation)                                                                                                                |  |               | 119,995,473   |   |                  |   | 120,310,290   |  
|Treasury stock at cost, 1,758,615 and 1,758,615 shares held                                                                                               |  |               | (12,283,985   | ) |                  |   | (12,283,985   | )
|                                                                                                                                                          |  |               |               |   |                  |   |               |  
|Total Net Assets                                                                                                                                          |  |               | 789,904,991   |   |                  |   | 781,959,168   |  
|                                                                                                                                                          |  |               |               |   |                  |   |               |  
|Total Liabilities and Net Assets                                                                                                                          |  | $             | 1,318,909,280 |   |                  | $ | 1,302,055,823 |  
|                                                                                                                                                          |  |               |               |   |                  |   |               |  
|Net Asset Value Per Share                                                                                                                                 |  | $             | 10.58         |   |                  | $ | 10.49         |  



3

The accompanying notes are an integral part of these consolidated financial statements.



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##### Table of Contents

BlackRock Capital Investment Corporation

Consolidated Statements of Operations

(Unaudited)



|                                                          |  |                    |            |   |               |   |             |  
|--------------------------------------------------------- |  | ------------------ | ---------- | - | ------------- | - | ----------- | -
|                                                          |  | Three months ended |           
|                                                          |  | March 31,2015      |            |   | March 31,2014 |  
|Investment Income:                                        |  |                    |            |   |               |   |             |  
|Interest income:                                          |  |                    |            |   |               |   |             |  
|Non-controlled, non-affiliated investments                |  | $                  | 23,325,856 |   |               | $ | 24,088,064  |  
|Non-controlled, affiliated investments                    |  |                    | 1,578,568  |   |               |   | 1,102,012   |  
|Controlled investments                                    |  |                    | 4,688,530  |   |               |   | 2,907,216   |  
|                                                          |  |                    |            |   |               |   |             |  
|Total interest income                                     |  |                    | 29,592,954 |   |               |   | 28,097,292  |  
|Fee income:                                               |  |                    |            |   |               |   |             |  
|Non-controlled, non-affiliated investments                |  |                    | 73,727     |   |               |   | 807,500     |  
|Non-controlled, affiliated investments                    |  |                    |           |   |               |   |            |  
|Controlled investments                                    |  |                    | 150,683    |   |               |   | 100,000     |  
|                                                          |  |                    |            |   |               |   |             |  
|Total fee income                                          |  |                    | 224,410    |   |               |   | 907,500     |  
|                                                          |  |                    |            |   |               |   |             |  
|Dividend income:                                          |  |                    |            |   |               |   |             |  
|Non-controlled, non-affiliated investments                |  |                    | 201,612    |   |               |   | 34,675      |  
|Non-controlled, affiliated investments                    |  |                    | 402,679    |   |               |   | 527,411     |  
|Controlled investments                                    |  |                    | 497,757    |   |               |   |            |  
|                                                          |  |                    |            |   |               |   |             |  
|Total dividend income                                     |  |                    | 1,102,048  |   |               |   | 562,086     |  
|                                                          |  |                    |            |   |               |   |             |  
|Total investment income                                   |  |                    | 30,919,412 |   |               |   | 29,566,878  |  
|                                                          |  |                    |            |   |               |   |             |  
|Expenses:                                                 |  |                    |            |   |               |   |             |  
|Base management fees                                      |  |                    | 6,370,630  |   |               |   | 6,160,619   |  
|Interest and credit facility fees                         |  |                    | 5,857,620  |   |               |   | 6,001,208   |  
|Incentive management fees                                 |  |                    | 1,377,907  |   |               |   | 3,459,865   |  
|Administrative services                                   |  |                    | 731,697    |   |               |   | 155,460     |  
|Amortization of debt issuance costs                       |  |                    | 513,357    |   |               |   | 544,599     |  
|Professional fees                                         |  |                    | 438,641    |   |               |   | 727,601     |  
|Investment advisor expenses                               |  |                    | 202,307    |   |               |   | 532,806     |  
|Director fees                                             |  |                    | 173,500    |   |               |   | 173,500     |  
|Other                                                     |  |                    | 630,176    |   |               |   | 717,025     |  
|                                                          |  |                    |            |   |               |   |             |  
|Total expenses                                            |  |                    | 16,295,835 |   |               |   | 18,472,683  |  
|                                                          |  |                    |            |   |               |   |             |  
|Net Investment Income                                     |  |                    | 14,623,577 |   |               |   | 11,094,195  |  
|                                                          |  |                    |            |   |               |   |             |  
|Realized and Unrealized Gain (Loss):                      |  |                    |            |   |               |   |             |  
|Net realized gain (loss):                                 |  |                    |            |   |               |   |             |  
|Non-controlled, non-affiliated investments                |  |                    | 5,437,850  |   |               |   | 33,827,245  |  
|Non-controlled, affiliated investments                    |  |                    | 9,286,910  |   |               |   |            |  
|Controlled investments                                    |  |                    | (6,377,901 | ) |               |   |            |  
|                                                          |  |                    |            |   |               |   |             |  
|Net realized gain (loss)                                  |  |                    | 8,346,859  |   |               |   | 33,827,245  |  
|                                                          |  |                    |            |   |               |   |             |  
|Net change in unrealized appreciation or depreciation on: |  |                    |            |   |               |   |             |  
|Non-controlled, non-affiliated investments                |  |                    | 1,547,571  |   |               |   | (25,340,019 | )
|Non-controlled, affiliated investments                    |  |                    | (4,194,074 | ) |               |   | 2,675,149   |  
|Controlled investments                                    |  |                    | 2,997,469  |   |               |   | 965,651     |  
|Foreign currency translation                              |  |                    | (665,783   | ) |               |   | (305,702    | )
|                                                          |  |                    |            |   |               |   |             |  
|Net change in unrealized appreciation or depreciation     |  |                    | (314,817   | ) |               |   | (22,004,921 | )
|                                                          |  |                    |            |   |               |   |             |  
|Net realized and unrealized gain (loss)                   |  |                    | 8,032,042  |   |               |   | 11,822,324  |  
|                                                          |  |                    |            |   |               |   |             |  
|Net Increase in Net Assets Resulting from Operations      |  | $                  | 22,655,619 |   |               | $ | 22,916,519  |  
|                                                          |  |                    |            |   |               |   |             |  
|Net Investment Income Per Share - basic                   |  | $                  | 0.20       |   |               | $ | 0.15        |  
|                                                          |  |                    |            |   |               |   |             |  
|Earnings Per Share - basic                                |  | $                  | 0.30       |   |               | $ | 0.31        |  
|                                                          |  |                    |            |   |               |   |             |  
|Average Shares Outstanding - basic                        |  |                    | 74,664,007 |   |               |   | 74,517,547  |  
|                                                          |  |                    |            |   |               |   |             |  
|Net Investment Income Per Share - diluted                 |  | $                  | 0.19       |   |               | $ | 0.15        |  
|                                                          |  |                    |            |   |               |   |             |  
|Earnings Per Share - diluted                              |  | $                  | 0.29       |   |               | $ | 0.29        |  
|                                                          |  |                    |            |   |               |   |             |  
|Average Shares Outstanding - diluted                      |  |                    | 84,560,734 |   |               |   | 84,414,275  |  
|                                                          |  |                    |            |   |               |   |             |  
|Distributions Declared Per Share                          |  | $                  | 0.21       |   |               | $ | 0.26        |  



4

The accompanying notes are an integral part of these consolidated financial statements.



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##### Table of Contents

BlackRock Capital Investment Corporation

Consolidated Statements of Changes in Net Assets

(Unaudited)



|                                                                     |  |                    |             |   |                |   |             |  
|-------------------------------------------------------------------- |  | ------------------ | ----------- | - | -------------- | - | ----------- | -
|                                                                     |  | Three months ended |            
|                                                                     |  | March 31, 2015     |             |   | March 31, 2014 |  
|Net Increase in Net Assets Resulting from Operations:                |  |                    |             |   |                |   |             |  
|Net investment income                                                |  | $                  | 14,623,577  |   |                | $ | 11,094,195  |  
|Net realized gain (loss)                                             |  |                    | 8,346,859   |   |                |   | 33,827,245  |  
|Net change in unrealized appreciation or depreciation                |  |                    | (314,817    | ) |                |   | (22,004,921 | )
|                                                                     |  |                    |             |   |                |   |             |  
|Net increase in net assets resulting from operations                 |  |                    | 22,655,619  |   |                |   | 22,916,519  |  
|                                                                     |  |                    |             |   |                |   |             |  
|Distributions to Stockholders from:                                  |  |                    |             |   |                |   |             |  
|Net investment income                                                |  |                    | (15,681,195 | ) |                |   | (19,375,252 | )
|                                                                     |  |                    |             |   |                |   |             |  
|Capital Share Transactions:                                          |  |                    |             |   |                |   |             |  
|Reinvestment of distributions                                        |  |                    | 971,399     |   |                |   | 1,044,638   |  
|                                                                     |  |                    |             |   |                |   |             |  
|Net increase in net assets resulting from capital share transactions |  |                    | 971,399     |   |                |   | 1,044,638   |  
|                                                                     |  |                    |             |   |                |   |             |  
|Total Increase in Net Assets                                         |  |                    | 7,945,823   |   |                |   | 4,585,905   |  
|Net assets at beginning of period                                    |  |                    | 781,959,168 |   |                |   | 709,704,341 |  
|                                                                     |  |                    |             |   |                |   |             |  
|Net assets at end of period                                          |  | $                  | 789,904,991 |   |                | $ | 714,290,246 |  
|                                                                     |  |                    |             |   |                |   |             |  
|Capital Share Activity:                                              |  |                    |             |   |                |   |             |  
|Shares issued from reinvestment of distributions                     |  |                    | 124,698     |   |                |   | 117,984     |  
|                                                                     |  |                    |             |   |                |   |             |  
|Net increase in shares outstanding                                   |  |                    | 124,698     |   |                |   | 117,984     |  
|                                                                     |  |                    |             |   |                |   |             |  



5

The accompanying notes are an integral part of these consolidated financial statements.



---

##### Table of Contents

BlackRock Capital Investment Corporation

Consolidated Statements of Cash Flows

(Unaudited)



|                                                                                      |  |                    |             |   |                |   |              |  
|------------------------------------------------------------------------------------- |  | ------------------ | ----------- | - | -------------- | - | ------------ | -
|                                                                                      |  | Three months ended |            
|                                                                                      |  | March 31, 2015     |             |   | March 31, 2014 |  
|Operating Activities:                                                                 |  |                    |             |   |                |   |              |  
|Net increase in net assets resulting from operations                                  |  | $                  | 22,655,619  |   |                | $ | 22,916,519   |  
|Adjustments to reconcile net increase in net assets resulting from operations:        |  |                    |             |   |                |   |              |  
|PIK interest and dividends                                                            |  |                    | (2,459,804  | ) |                |   | (1,227,416   | )
|Net amortization on investments                                                       |  |                    | (809,738    | ) |                |   | (872,206     | )
|Amortization of debt issuance costs                                                   |  |                    | 513,357     |   |                |   | 544,600      |  
|Net change in unrealized appreciation or depreciation on investments                  |  |                    | (350,966    | ) |                |   | 21,699,219   |  
|Net change in unrealized appreciation or depreciation on foreign currency translation |  |                    | 665,783     |   |                |   | 305,702      |  
|Net realized (gain) loss on investments                                               |  |                    | (8,346,859  | ) |                |   | (33,827,245  | )
|Changes in operating assets:                                                          |  |                    |             |   |                |   |              |  
|Purchase of investments                                                               |  |                    | (43,840,188 | ) |                |   | (61,727,731  | )
|Proceeds from disposition of investments                                              |  |                    | 74,874,153  |   |                |   | 188,032,090  |  
|Change in receivable for investments sold                                             |  |                    | (1,246,236  | ) |                |   | (45,103,578  | )
|Change in interest receivable                                                         |  |                    | (4,379,379  | ) |                |   | (6,286,319   | )
|Change in prepaid expenses and other assets                                           |  |                    | 1,187,820   |   |                |   | (501,400     | )
|Changes in operating liabilities:                                                     |  |                    |             |   |                |   |              |  
|Change in payable for investments purchased                                           |  |                    |            |   |                |   | (21,000,000  | )
|Change in interest payable                                                            |  |                    | (4,485,595  | ) |                |   | (4,736,440   | )
|Change in management fees payable                                                     |  |                    | 621,411     |   |                |   | 357,122      |  
|Change in incentive management fees payable                                           |  |                    | (8,594,915  | ) |                |   | (5,511,255   | )
|Change in accrued administrative services                                             |  |                    | (83,905     | ) |                |   | (82,974      | )
|Change in other accrued expenses and payables                                         |  |                    | (288,216    | ) |                |   | (147,446     | )
|                                                                                      |  |                    |             |   |                |   |              |  
|Net cash provided by (used in) operating activities                                   |  |                    | 25,632,342  |   |                |   | 52,831,242   |  
|                                                                                      |  |                    |             |   |                |   |              |  
|Financing Activities:                                                                 |  |                    |             |   |                |   |              |  
|Distributions paid in cash                                                            |  |                    | (14,683,607 | ) |                |   | (18,300,044  | )
|Proceeds from debt                                                                    |  |                    | 56,060,706  |   |                |   | 217,060,705  |  
|Repayments of debt                                                                    |  |                    | (32,000,000 | ) |                |   | (236,000,000 | )
|                                                                                      |  |                    |             |   |                |   |              |  
|Net cash provided by (used in) financing activities                                   |  |                    | 9,377,099   |   |                |   | (37,239,339  | )
|                                                                                      |  |                    |             |   |                |   |              |  
|Net increase (decrease) in cash                                                       |  |                    | 35,009,441  |   |                |   | 15,591,903   |  
|Cash and cash equivalents, beginning of period                                        |  |                    | 10,326,174  |   |                |   | 18,474,784   |  
|                                                                                      |  |                    |             |   |                |   |              |  
|Cash and cash equivalents, end of period                                              |  | $                  | 45,335,615  |   |                | $ | 34,066,687   |  
|                                                                                      |  |                    |             |   |                |   |              |  
|Supplemental disclosure of cash flow information and non-cash financing activities:   |  |                    |             |   |                |   |              |  
|Cash paid during period for:                                                          |  |                    |             |   |                |   |              |  
|Interest                                                                              |  | $                  | 10,040,353  |   |                | $ | 10,504,775   |  
|Taxes                                                                                 |  | $                  | 34,914      |   |                | $ | 81,868       |  
|Distributions reinvested                                                              |  | $                  | 971,399     |   |                | $ | 1,044,638    |  



The accompanying notes are an integral
part of these consolidated financial statements.



6



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##### Table of Contents

BlackRock Capital Investment Corporation

Consolidated Schedules of Investments

March 31, 2015

(Unaudited)



|                                                    |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|--------------------------------------------------- |  | ------------------ |  | ------------- |  | -------- |  | ------------------------------------------ | ---------- |  | ------- | - | ----------- | ------------- |  | - | ----------- | 
|Portfolio Company                                   |  | Industry           |  | Interest Rate |  | Maturity |  | Principal
Amount or
Number of
Shares/Units |            |  | Cost(a) |   |             | Fair
Value(b) | 
|Senior Secured Notes13.0%                          |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Advanced Lighting Technologies, Inc., First Lien(i) |  | Lighting           |  | 10.50%        |  | 6/1/19   |  | $                                          | 20,000,000 |  |         | $ | 19,680,369  |               |  | $ | 16,200,000  | 
|AGY Holding Corp., Second Lien(d)(i)                |  | GlassYarns/Fibers  |  | 11.00%        |  | 12/15/16 |  |                                            | 21,762,500 |  |         |   | 20,459,519  |               |  |   | 20,892,000  | 
|American Piping Products, Inc., Second Lien(i)      |  | Distribution       |  | 12.88%        |  | 11/15/17 |  |                                            | 10,000,000 |  |         |   | 9,889,184   |               |  |   | 10,200,000  | 
|BPA Laboratories Inc., First Lien(i)                |  | HealthcareServices |  | 12.25%        |  | 4/1/17   |  |                                            | 35,078,000 |  |         |   | 34,571,844  |               |  |   | 35,078,000  | 
|New Gulf Resources, LLC, First Lien(i)              |  | Energy             |  | 11.75%        |  | 5/15/19  |  |                                            | 21,000,000 |  |         |   | 20,840,634  |               |  |   | 20,160,000  | 
|                                                    |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Total Senior Secured Notes                          |  |                    |  |               |  |          |  |                                            |            |  |         |   | 105,441,550 |               |  |   | 102,530,000 | 
|                                                    |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Unsecured Debt21.5%                                |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Gordon Brothers Finance Company(f)(n)(p)            |  | SpecialtyFinance   |  | 12.00%        |  | 10/31/21 |  |                                            | 70,310,979 |  |         |   | 70,310,979  |               |  |   | 70,310,979  | 
|Higginbotham Insurance Holdings, Inc.(n)            |  | Insurance          |  | 9.76%         |  | 6/11/19  |  |                                            | 36,750,000 |  |         |   | 36,750,000  |               |  |   | 36,750,000  | 
|QHB Holdings LLC(o)                                 |  | Materials          |  | 16.00%        |  | 12/17/19 |  |                                            | 20,000,000 |  |         |   | 20,000,000  |               |  |   | 20,000,000  | 
|SVP Worldwide Ltd.(g)(j)(o)                         |  | ConsumerProducts   |  | 16.00%        |  | 6/27/18  |  |                                            | 44,954,239 |  |         |   | 44,954,239  |               |  |   | 43,156,070  | 
|                                                    |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Total Unsecured Debt                                |  |                    |  |               |  |          |  |                                            |            |  |         |   | 172,015,218 |               |  |   | 170,217,049 | 
|                                                    |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Subordinated Debt3.6%                              |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Advantage Insurance Holdings Ltd.(d)(g)(i)(j)       |  | Insurance          |  | 12.00%        |  | 9/30/15  |  |                                            | 1,000,000  |  |         |   | 1,000,000   |               |  |   | 1,000,000   | 
|Automobile Protection CorporationAPCO(n)           |  | Insurance          |  | 9.78%         |  | 6/17/19  |  |                                            | 25,000,000 |  |         |   | 25,000,000  |               |  |   | 25,000,000  | 
|New Gulf Resources, LLC(i)(o)                       |  | Energy             |  | 12.00%        |  | 11/15/19 |  |                                            | 4,248,000  |  |         |   | 3,791,550   |               |  |   | 2,548,800   | 
|                                                    |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Total Subordinated Debt                             |  |                    |  |               |  |          |  |                                            |            |  |         |   | 29,791,550  |               |  |   | 28,548,800  | 
|                                                    |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 



The accompanying
notes are an integral part of these consolidated financial statements.



7



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##### Table of Contents

BlackRock Capital Investment Corporation

Consolidated Schedules of Investments(Continued)

March 31, 2015

(Unaudited)



|                                                                     |  |                        |  |               |  |          |  |                                            |            |  |         |   |            |               |  |   |            | 
|-------------------------------------------------------------------- |  | ---------------------- |  | ------------- |  | -------- |  | ------------------------------------------ | ---------- |  | ------- | - | ---------- | ------------- |  | - | ---------- | 
|Portfolio Company                                                    |  | Industry               |  | Interest Rate |  | Maturity |  | Principal
Amount or
Number of
Shares/Units |            |  | Cost(a) |   |            | Fair
Value(b) | 
|Senior Secured Loans85.9%(e)                                        |  |                        |  |               |  |          |  |                                            |            |  |         |   |            |               |  |   |            | 
|Accriva Diagnostics, Inc., First Lien                                |  | Healthcare             |  | 12.25%        |  | 1/17/19  |  | $                                          | 21,000,000 |  |         | $ | 21,000,000 |               |  | $ | 21,000,000 | 
|AGY Holding Corp., Second Lien(d)                                    |  | GlassYarns/Fibers      |  | 12.00%        |  | 9/15/16  |  |                                            | 19,763,384 |  |         |   | 19,763,384 |               |  |   | 19,763,384 | 
|AL Solutions, Inc., Term Loan B, Second Lien(o)                      |  | Metals                 |  | 5.00%         |  | 12/31/19 |  |                                            | 75,636     |  |         |   |           |               |  |   |           | 
|Bankruptcy Management Solutions, Inc., Term Loan A, First Lien(f)(n) |  | FinancialServices      |  | 4.50%         |  | 6/27/17  |  |                                            | 1,921,612  |  |         |   | 1,860,028  |               |  |   | 1,863,966  | 
|Bankruptcy Management Solutions, Inc., Term Loan B, First Lien(f)(n) |  | FinancialServices      |  | 7.00%         |  | 6/27/18  |  |                                            | 11,782,149 |  |         |   | 10,344,915 |               |  |   | 10,132,648 | 
|Foundation Building Materials, LLC, Second Lien(n)                   |  | WholesaleTrade         |  | 12.00%        |  | 4/30/19  |  |                                            | 25,000,000 |  |         |   | 24,753,186 |               |  |   | 24,753,186 | 
|GSE Environmental, Inc., First Lien(n)                               |  | Manufacturing          |  | 11.00%        |  | 8/11/21  |  |                                            | 42,352,941 |  |         |   | 42,352,941 |               |  |   | 42,352,941 | 
|Hunter Defense Technologies, Inc., Second Lien(n)                    |  | Defense                |  | 11.00%        |  | 2/5/20   |  |                                            | 45,000,000 |  |         |   | 45,000,000 |               |  |   | 45,000,000 | 
|JLL Pioneer Inc., Second Lien                                        |  | BuildingProducts       |  | 9.50%         |  | 12/31/20 |  |                                            | 20,000,000 |  |         |   | 20,000,000 |               |  |   | 20,000,000 | 
|K2 Pure Solutions Nocal, L.P. First Lien(n)                          |  | Chemicals              |  | 11.00%        |  | 8/19/19  |  |                                            | 19,625,000 |  |         |   | 19,339,477 |               |  |   | 19,625,000 | 
|Learfield Communications, Inc., Second Lien(n)                       |  | Media andEntertainment |  | 8.75%         |  | 10/9/21  |  |                                            | 3,000,000  |  |         |   | 2,978,704  |               |  |   | 3,000,000  | 
|MD America Energy, LLC, First Lien(n)                                |  | Energy                 |  | 9.50%         |  | 8/4/19   |  |                                            | 10,000,000 |  |         |   | 9,564,335  |               |  |   | 9,800,000  | 
|MediMedia USA, Inc., First Lien(n)                                   |  | InformationServices    |  | 8.00%         |  | 11/20/18 |  |                                            | 8,780,983  |  |         |   | 8,667,232  |               |  |   | 8,780,983  | 
|MediMedia USA, Inc., Second Lien(n)                                  |  | InformationServices    |  | 12.25%        |  | 11/20/19 |  |                                            | 60,000,000 |  |         |   | 58,712,775 |               |  |   | 57,600,000 | 
|Novolex Holdings, Inc., Second Lien(n)                               |  | Manufacturing          |  | 9.75%         |  | 6/5/22   |  |                                            | 5,000,000  |  |         |   | 4,879,551  |               |  |   | 4,950,000  | 
|Oxford Mining Company, LLC, First Lien(n)(o)                         |  | Energy                 |  | 12.25%        |  | 12/31/18 |  |                                            | 14,941,737 |  |         |   | 14,941,737 |               |  |   | 14,941,737 | 
|Pre-Paid Legal Services, Inc., Second Lien(n)                        |  | LegalServices          |  | 9.75%         |  | 7/1/20   |  |                                            | 25,000,000 |  |         |   | 24,717,785 |               |  |   | 25,000,000 | 
|Quality Home Brands Holdings LLC, Second Lien(n)                     |  | Materials              |  | 11.75%        |  | 6/17/19  |  |                                            | 40,000,000 |  |         |   | 40,000,000 |               |  |   | 40,000,000 | 
|Red Apple Stores Inc., Second Lien(f)(g)(j)                          |  | DiscountStores         |  | 10.00%        |  | 1/11/17  |  |                                            | 23,050,000 |  |         |   | 23,050,000 |               |  |   | 23,050,000 | 
|Road Infrastructure Investment, LLC, Second Lien(n)                  |  | Manufacturing          |  | 7.75%         |  | 9/30/21  |  |                                            | 9,000,000  |  |         |   | 8,293,369  |               |  |   | 8,280,000  | 



The accompanying notes are an integral part of these consolidated financial statements.



8



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##### Table of Contents

BlackRock Capital Investment Corporation

Consolidated Schedules of Investments(Continued)

March 31, 2015

(Unaudited)



|                                                                              |  |                          |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|----------------------------------------------------------------------------- |  | ------------------------ |  | ------------- |  | -------- |  | ------------------------------------------ | ---------- |  | ------- | - | ----------- | ------------- |  | - | ----------- | 
|Portfolio Company                                                             |  | Industry                 |  | Interest Rate |  | Maturity |  | Principal
Amount or
Number of
Shares/Units |            |  | Cost(a) |   |             | Fair
Value(b) | 
|Royal Adhesives and Sealants, LLC, Second Lien(n)                             |  | Chemicals                |  | 9.75%         |  | 1/31/19  |  | $                                          | 6,000,000  |  |         | $ | 5,916,546   |               |  | $ | 6,057,498   | 
|Shoreline Energy LLC, Second Lien(n)                                          |  | Energy                   |  | 10.25%        |  | 3/30/19  |  |                                            | 28,333,333 |  |         |   | 27,714,227  |               |  |   | 27,129,166  | 
|SOURCEHOV, LLC, First Lien(n)                                                 |  | BusinessServices         |  | 7.75%         |  | 10/31/19 |  |                                            | 4,968,750  |  |         |   | 4,831,454   |               |  |   | 4,819,688   | 
|SOURCEHOV, LLC, Second Lien(n)                                                |  | BusinessServices         |  | 11.50%        |  | 4/30/20  |  |                                            | 5,000,000  |  |         |   | 4,811,654   |               |  |   | 4,800,000   | 
|Sur La Table, Inc., First Lien                                                |  | ConsumerProducts         |  | 12.00%        |  | 7/28/17  |  |                                            | 50,000,000 |  |         |   | 50,000,000  |               |  |   | 50,500,000  | 
|U.S. Well Services, LLC, First Lien(n)                                        |  | Energy                   |  | 12.00%        |  | 5/2/19   |  |                                            | 48,574,232 |  |         |   | 48,574,232  |               |  |   | 48,574,232  | 
|United Subcontractors, Inc., First Lien(d)(n)(o)                              |  | Building andConstruction |  | 4.28%         |  | 6/30/15  |  |                                            | 6,349,274  |  |         |   | 6,327,632   |               |  |   | 6,349,274   | 
|Vertellus Specialties Inc., First Lien(n)                                     |  | SpecialtyChemicals       |  | 10.50%        |  | 10/31/19 |  |                                            | 54,725,000 |  |         |   | 54,725,000  |               |  |   | 53,630,500  | 
|Water Pik, Inc., Second Lien(n)                                               |  | ConsumerProducts         |  | 9.75%         |  | 1/8/21   |  |                                            | 22,868,421 |  |         |   | 22,223,585  |               |  |   | 22,868,421  | 
|WBS Group LLC, First Lien(f)(n)                                               |  | Software                 |  | 9.50%         |  | 6/30/15  |  |                                            | 27,284,255 |  |         |   | 27,284,255  |               |  |   | 27,284,255  | 
|WBS Group LLC, Second Lien(f)(n)                                              |  | Software                 |  | 10.50%        |  | 12/31/15 |  |                                            | 24,999,000 |  |         |   | 24,877,756  |               |  |   | 19,749,210  | 
|Westward Dough Operating Company, LLC, First Lien(f)                          |  | Restaurants              |  | 9.00%         |  | 3/2/17   |  |                                            | 6,590,896  |  |         |   | 6,590,896   |               |  |   | 6,590,896   | 
|                                                                              |  |                          |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Total Senior Secured Loans                                                    |  |                          |  |               |  |          |  |                                            |            |  |         |   | 684,096,656 |               |  |   | 678,246,985 | 
|                                                                              |  |                          |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Preferred Stock5.6%                                                          |  |                          |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Advantage Insurance Holdings Ltd.(d)(g)(i)(j)                                 |  | Insurance                |  | 8.00%         |  |          |  |                                            | 750,000    |  |         |   | 8,377,619   |               |  |   | 8,377,619   | 
|KAGY Holding Company, Inc. (AGY Holding Corp.)(d)                             |  | GlassYarns/Fibers        |  | 20.00%        |  |          |  |                                            | 22,960     |  |         |   | 6,195,568   |               |  |   | 3,282,426   | 
|Gordon Brothers Finance Company(f)(p)                                         |  | SpecialtyFinance         |  | 13.50%        |  |          |  |                                            | 16,085     |  |         |   | 16,085,098  |               |  |   | 16,085,098  | 
|Oportun Financial Corporation (Progress Financial Corporation), Series F-1(c) |  | FinancialServices        |  |               |  |          |  |                                            | 963,710    |  |         |   | 740,313     |               |  |   | 3,074,235   | 
|Oportun Financial Corporation (Progress Financial Corporation), Series G(c)   |  | FinancialServices        |  |               |  |          |  |                                            | 1,758,256  |  |         |   | 2,013,112   |               |  |   | 5,608,837   | 
|Red Apple Stores Inc.(f)(g)(j)                                                |  | DiscountStores           |  | 12.00%        |  |          |  |                                            | 6,806,383  |  |         |   | 233,686     |               |  |   | 205,077     | 
|USI Senior Holdings, Inc. (United Subcontractors)(c)(d)                       |  | Building andConstruction |  |               |  |          |  |                                            | 260,798    |  |         |   | 5,374,317   |               |  |   | 7,823,940   | 
|                                                                              |  |                          |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Total Preferred Stock                                                         |  |                          |  |               |  |          |  |                                            |            |  |         |   | 39,019,713  |               |  |   | 44,457,232  | 
|                                                                              |  |                          |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 



The accompanying notes are an integral part of these consolidated financial statements.



9



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##### Table of Contents

BlackRock Capital Investment Corporation

Consolidated Schedules of Investments(Continued)

March 31, 2015

(Unaudited)



|                                                              |  |                                    |  |               |  |          |  |                                            |           |  |         |   |            |               |  |   |            | 
|------------------------------------------------------------- |  | ---------------------------------- |  | ------------- |  | -------- |  | ------------------------------------------ | --------- |  | ------- | - | ---------- | ------------- |  | - | ---------- | 
|Portfolio Company                                             |  | Industry                           |  | Interest Rate |  | Maturity |  | Principal
Amount or
Number of
Shares/Units |           |  | Cost(a) |   |            | Fair
Value(b) | 
|Common Stock12.3%(d)                                         |  |                                    |  |               |  |          |  |                                            |           |  |         |   |            |               |  |   |            | 
|Bankruptcy Management Solutions, Inc.(f)                      |  | FinancialServices                  |  |               |  |          |  |                                            | 368,790   |  |         | $ | 16,654,505 |               |  | $ | 23,919,719 | 
|DynaVox Inc.                                                  |  | AugmentativeCommunication
Products |  |               |  |          |  |                                            | 272,369   |  |         |   | 758,069    |               |  |   | 10,895     | 
|Gordon Brothers Finance Company(f)(p)                         |  | SpecialtyFinance                   |  |               |  |          |  |                                            | 10,598    |  |         |   | 10,598,300 |               |  |   | 10,510,670 | 
|Red Apple Stores Inc.(f)(g)(h)(j)                             |  | DiscountStores                     |  |               |  |          |  |                                            | 8,756,859 |  |         |   | 6,895,843  |               |  |   |           | 
|Tygem Holdings, Inc., Class A                                 |  | Metals                             |  |               |  |          |  |                                            | 30,000    |  |         |   |           |               |  |   |           | 
|USI Senior Holdings, Inc. (United Subcontractors)(d)          |  | Building andConstruction           |  |               |  |          |  |                                            | 260,798   |  |         |   | 9,019,888  |               |  |   | 62,922,733 | 
|                                                              |  |                                    |  |               |  |          |  |                                            |           |  |         |   |            |               |  |   |            | 
|Total Common Stock                                            |  |                                    |  |               |  |          |  |                                            |           |  |         |   | 43,926,605 |               |  |   | 97,364,017 | 
|                                                              |  |                                    |  |               |  |          |  |                                            |           |  |         |   |            |               |  |   |            | 
|Limited Partnership/Limited Liability Company Interests11.8% | 
|ECI Cayman Holdings, LP(c)(g)(i)(j)                           |  | Electronics                        |  |               |  |          |  |                                            | 3,184     |  |         |   | 3,183,840  |               |  |   | 3,956,629  | 
|Higginbotham Investment Holdings, LLC(c)                      |  | Insurance                          |  |               |  |          |  |                                            | 1,163     |  |         |   | 726,745    |               |  |   | 2,088,001  | 
|Marsico Holdings, LLC(c)(i)                                   |  | FinancialServices                  |  |               |  |          |  |                                            | 91,445    |  |         |   | 1,848,077  |               |  |   | 5,487      | 
|Penton Business Media Holdings, LLC(c)(d)                     |  | InformationServices                |  |               |  |          |  |                                            | 226       |  |         |   | 9,050,000  |               |  |   | 70,182,000 | 
|PG Holdco, LLC                                                |  | HealthcareServices                 |  | 15.00%        |  |          |  |                                            | 333       |  |         |   | 512,254    |               |  |   | 512,254    | 
|PG Holdco, LLC, Class A(c)                                    |  | HealthcareServices                 |  |               |  |          |  |                                            | 16,667    |  |         |   | 166,667    |               |  |   | 626,629    | 
|Sentry Security Systems Holdings, LLC(c)                      |  | SecurityServices                   |  |               |  |          |  |                                            | 147,271   |  |         |   | 147,271    |               |  |   | 24,449     | 
|Sentry Security Systems Holdings, LLC                         |  | SecurityServices                   |  | 8.00%         |  |          |  |                                            | 602,729   |  |         |   | 1,128,270  |               |  |   | 1,128,270  | 
|U.S. Well Services, LLC(i)(k)                                 |  | Energy                             |  | 8.00%         |  |          |  |                                            | 8,085     |  |         |   | 8,326,671  |               |  |   | 12,038,128 | 
|WBS Group LLC(c)(f)(l)                                        |  | Software                           |  |               |  |          |  |                                            | 100       |  |         |   | 1,000      |               |  |   |           | 
|Westward Dough Holdings, LLC, Class A(c)(f)(m)                |  | Restaurants                        |  |               |  |          |  |                                            | 350,000   |  |         |   | 9,260,324  |               |  |   | 2,331,000  | 
|                                                              |  |                                    |  |               |  |          |  |                                            |           |  |         |   |            |               |  |   |            | 
|Total Limited Partnership/Limited Liability Company Interests |  |                                    |  | 34,351,119    |  |          |  | 92,892,847                                 |          
|                                                              |  |                                    |  |               |  |          |  |                                            |           |  |         |   |            |               |  |   |            | 



The accompanying notes are an integral part of these consolidated financial statements.



10



---

##### Table of Contents

BlackRock Capital Investment Corporation

Consolidated Schedules of Investments(Continued)

March 31, 2015

(Unaudited)



|                                                               |  |                   |  |               |  |                 |               |                                            |           |  |               |  |           |               |  |   |             | 
|-------------------------------------------------------------- |  | ----------------- |  | ------------- |  | --------------- | ------------- | ------------------------------------------ | --------- |  | ------------- |  | --------- | ------------- |  | - | ----------- | 
|Portfolio Company                                              |  | Industry          |  | Interest Rate |  | Maturity        |               | Principal
Amount or
Number of
Shares/Units |           |  | Cost(a)       |  |           | Fair
Value(b) | 
|Equity Warrants/Options2.7%(c)                                |  |                   |  |               |  |                 |               |                                            |           |  |               |  |           |               |  |  
|Bankruptcy Management Solutions, Inc., Tranche A(f)            |  | FinancialServices |  |               |  | expire 6/27/18  |               |                                            | 28,464    |  |               |  | $375,040  |               |  |   | $687,690    | 
|Bankruptcy Management Solutions, Inc., Tranche B(f)            |  | FinancialServices |  |               |  | expire 6/27/19  |               |                                            | 30,654    |  |               |  | 342,295   |               |  |   | 612,160     | 
|Bankruptcy Management Solutions, Inc., Tranche C(f)            |  | FinancialServices |  |               |  | expire 6/27/20  |               |                                            | 45,981    |  |               |  | 468,803   |               |  |   | 818,922     | 
|Facet Investment, Inc.                                         |  | MedicalDevices    |  |               |  | expire 1/18/21  |               |                                            | 1,978     |  |               |  | 250,000   |               |  |   |            | 
|Marsico Parent Superholdco, LLC(i)                             |  | FinancialServices |  |               |  | expire 12/14/19 |               |                                            | 455       |  |               |  | 444,450   |               |  |   |            | 
|New Gulf Resources, LLC(i)                                     |  | Energy            |  |               |  | expire 5/9/24   |               |                                            | 4,000     |  |               |  | 506,505   |               |  |   |            | 
|Oportun Financial Corporation (Progress Financial Corporation) |  | FinancialServices |  |               |  | expire various  |               |                                            | 6,959,220 |  |               |  | 3,183,106 |               |  |   | 18,750,614  | 
|Twin River Worldwide Holdings, Inc., Contingent Value Rights   |  | Gaming            |  |               |  | expire 11/5/17  |               |                                            | 1,000     |  |               |  | 5,000     |               |  |   | 510,000     | 
|                                                               |  |                   |  |               |  |                 |               |                                            |           |  |               |  |           |               |  |   |             | 
|Total Equity Warrants/Options                                  |  |                   |  |               |  |                 |               |                                            |           |  |               |  | 5,575,199 |               |  |   | 21,379,386  | 
|                                                               |  |                   |  |               |  |                 |               |                                            |           |  |               |  |           |               |  |   |             | 
|TOTAL INVESTMENTS156.4%                                       |  |                   |  |               |  | $               | 1,114,217,610 |                                            |           |  | 1,235,636,316 | 
|                                                               |  |                   |  |               |  |                 |               |                                            |           |  |               |  |           |               |  |   |             | 
|OTHER ASSETS & LIABILITIES (NET)(56.4)%                       |  |                   |  |               |  |                 |               | (445,731,325                               | )        
|                                                               |  |                   |  |               |  |                 |               |                                            |           |  |               |  |           |               |  |   |             | 
|NET ASSETS100.0%                                              |  |                   |  |               |  |                 |               |                                            |           |  |               |  |           |               |  | $ | 789,904,991 | 
|                                                               |  |                   |  |               |  |                 |               |                                            |           |  |               |  |           |               |  |   |             | 





| | (a) | Represents amortized cost for fixed income securities and cost for preferred and common stock, limited partnership/limited liability company interests and equity warrants/options.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | Fair value is determined by or under the direction of the Companys Board of Directors. See Note 2 for further details.
| | --- | -----------------------------------------------------------------------------------------------------------------------

| | (c) | Non-income producing securities at March 31, 2015.
| | --- | --------------------------------------------------

| | (d) | Transaction and other information for non-controlled, affiliated investments under the Investment Company Act of 1940, whereby the Company owns 5% or more (but not more than 25%) of the portfolio
companys outstanding voting securities.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (e) | Approximately 82% of the senior secured loans of the Companys portfolio companies bear interest at a floating rate that may be determined by reference to the London Interbank Offered Rate (LIBOR) or other base
rate (commonly the Federal Funds Rate or the Prime Rate), at the borrowers option. In addition, approximately 81% of such senior secured loans have floors of 0.50% to 1.50%. The borrower under a senior secured loan generally has the option to
select from interest reset periods of one, two, three or six months and may alter that selection at the end of any reset period. The stated interest rate represents the weighted average interest rate at March 31, 2015 of all contracts within
the specified loan facility.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The accompanying notes are an integral part of these consolidated financial statements.



11



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##### Table of Contents

|                                               |  |                               |             |  |                       |   |         |                         |  |   |                          |   |  |                             |            |   |                                   |   |             |                |  |   |           |  |  |                |           |  |  |   |   |  |  |   |         | 
|---------------------------------------------- |  | ----------------------------- | ----------- |  | --------------------- | - | ------- | ----------------------- |  | - | ------------------------ | - |  | --------------------------- | ---------- | - | --------------------------------- | - | ----------- | -------------- |  | - | --------- |  |  | -------------- | --------- |  |  | - | - |  |  | - | ------- | 
|                                               |  |                               |             |  |                       |   |         |                         |  |   |                          |   |  |                             |            |   | Three Months Ended March 31, 2015 |  
|Non-controlled, Affiliated Investments         |  | Fair
Value atDecember 31,2014 |             |  | GrossAdditions(Cost)* |   |         | GrossReductions(Cost)** |  |   | NetUnrealizedGain (Loss) |   |  | Fair Value at
March 31,2015 |            |   | NetRealizedGain (Loss)            |   |             | InterestIncome |  |   | FeeIncome |  |  | DividendIncome |          
|Advantage Insurance Holdings Ltd.:             |  |                               |             |  |                       |   |         |                         |  |   |                          |   |  |                             |            |   |                                   |   |             |                |  |   |           |  |  |                |           |  |  |   |   |  |  |   |         | 
|Subordinated Debt                              |  | $                             | 3,000,000   |  |                       | $ |        |                         |  | $ | (2,000,000               | ) |  | $                           |           |   |                                   | $ | 1,000,000   |                |  | $ |          |  |  | $              | 90,411    |  |  | $ |  |  |  | $ |        | 
|Preferred Stock                                |  |                               | 8,379,450   |  |                       |   | 162,031 |                         |  |   |                         |   |  |                             | (163,862   | ) |                                   |   | 8,377,619   |                |  |   |          |  |  |                |          |  |  |   |  |  |  |   | 162,030 | 
|AGY Holding Corp.:                             |  |                               |             |  |                       |   |         |                         |  |   |                          |   |  |                             |            |   |                                   |   |             |                |  |   |           |  |  |                |           |  |  |   |   |  |  |   |         | 
|Senior Secured Note                            |  |                               | 20,021,500  |  |                       |   | 197,115 |                         |  |   |                         |   |  |                             | 673,385    |   |                                   |   | 20,892,000  |                |  |   |          |  |  |                | 795,583   |  |  |   |  |  |  |   |        | 
|Senior Secured Loan                            |  |                               | 19,763,384  |  |                       |   |        |                         |  |   |                         |   |  |                             |           |   |                                   |   | 19,763,384  |                |  |   |          |  |  |                | 592,902   |  |  |   |  |  |  |   |        | 
|KAGY Holding Company, Inc. (AGY Holding Corp.) |  |                               |             |  |                       |   |         |                         |  |   |                          |   |  |                             |            |   |                                   |   |             |                |  |   |           |  |  |                |           |  |  |   |   |  |  |   |         | 
|Preferred Stock                                |  |                               | 3,266,124   |  |                       |   | 240,651 |                         |  |   |                         |   |  |                             | (224,349   | ) |                                   |   | 3,282,426   |                |  |   |          |  |  |                |          |  |  |   |  |  |  |   | 240,649 | 
|M&M Tradition Holdings Corp.                   |  |                               |             |  |                       |   |         |                         |  |   |                          |   |  |                             |            |   |                                   |   |             |                |  |   |           |  |  |                |           |  |  |   |   |  |  |   |         | 
|Common Stock                                   |  |                               | 13,500,000  |  |                       |   |        |                         |  |   | (5,000,000               | ) |  |                             | (8,500,000 | ) |                                   |   |            |               |  |   | 9,286,910 |  |  |                |          |  |  |   |  |  |  |   |        | 
|Penton Business Media Holdings, LLC            |  |                               |             |  |                       |   |         |                         |  |   |                          |   |  |                             |            |   |                                   |   |             |                |  |   |           |  |  |                |           |  |  |   |   |  |  |   |         | 
|Limited Liability Co. Interest                 |  |                               | 70,182,000  |  |                       |   |        |                         |  |   |                         |   |  |                             |           |   |                                   |   | 70,182,000  |                |  |   |          |  |  |                |          |  |  |   |  |  |  |   |        | 
|United Subcontractors, Inc.                    |  |                               |             |  |                       |   |         |                         |  |   |                          |   |  |                             |            |   |                                   |   |             |                |  |   |           |  |  |                |           |  |  |   |   |  |  |   |         | 
|Senior Secured Loan                            |  |                               | 6,349,276   |  |                       |   | 32,046  |                         |  |   |                         |   |  |                             | (32,048    | ) |                                   |   | 6,349,274   |                |  |   |          |  |  |                | 99,672    |  |  |   |  |  |  |   |        | 
|USI Senior Holdings, Inc.:                     |  |                               |             |  |                       |   |         |                         |  |   |                          |   |  |                             |            |   |                                   |   |             |                |  |   |           |  |  |                |           |  |  |   |   |  |  |   |         | 
|Common Stock                                   |  |                               | 58,869,933  |  |                       |   |        |                         |  |   |                         |   |  |                             | 4,052,800  |   |                                   |   | 62,922,733  |                |  |   |          |  |  |                |          |  |  |   |  |  |  |   |        | 
|Preferred Stock                                |  |                               | 7,823,940   |  |                       |   |        |                         |  |   |                         |   |  |                             |           |   |                                   |   | 7,823,940   |                |  |   |          |  |  |                |          |  |  |   |  |  |  |   |        | 
|                                               |  |                               |             | 
|Totals                                         |  | $                             | 211,155,607 |  |                       | $ | 631,843 |                         |  | $ | (7,000,000               | ) |  | $                           | (4,194,074 | ) |                                   | $ | 200,593,376 |                |  | $ | 9,286,910 |  |  | $              | 1,578,568 |  |  | $ |  |  |  | $ | 402,679 | 
|                                               |  |                               |             | 



| | * | Gross additions include increases in the cost basis of investments resulting from new portfolio investments, payment-in-kind (PIK) interest or dividends, the amortization of unearned income, the exchange of
one or more existing securities for one or more new securities and the movement of an existing portfolio company into this category from a different category.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | ** | Gross reductions include decreases in the cost basis of investments resulting from principal collections related to investment repayments or sales, the exchange of one or more existing securities for one or more new
securities and the movement of an existing portfolio company out of this category into a different category.
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Investment no longer held as of March 31, 2015.
| | - | -----------------------------------------------

The aggregate fair value of
non-controlled, affiliated investments at March 31, 2015 represents 25.4% of the Companys net assets.







| | (f) | Transaction and other information for controlled investments under the Investment Company Act of 1940, whereby the Company owns more than 25% of the portfolio companys outstanding voting securities.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (g) | Non-U.S. company or principal place of business outside the U.S.
| | --- | ----------------------------------------------------------------

| | (h) | Original purchase denominated in Canadian dollars.
| | --- | --------------------------------------------------

| | (i) | Security is exempt from registration under Rule 144A of the Securities Act of 1933. Such securities may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. In the
aggregate, these securities represent 16.5% of the Companys net assets at March 31, 2015.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (j) | BDCs are required to invest at least 70% of their total assets primarily in securities of private or thinly traded U.S. public companies, cash, cash equivalents, U.S. Government securities and other high quality debt
investments that mature in one year or less. The securities referenced represent either fully or partially non-qualified assets for purposes of this requirement.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (k) | The Company is the sole stockholder of BKC ASW Blocker, Inc., a consolidated subsidiary, which is the beneficiary of less than 5% of the voting securities of U.S. Well Services, LLC and thus a non-controlled,
non-affiliated investment.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (l) | The Company is the sole stockholder of BKC ASW Blocker, Inc., a consolidated subsidiary, which is the beneficiary of more than 25% of the voting securities of Westward Dough Holdings, LLC and thus a controlled
investment.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (m) | The Company is the sole stockholder of BKC-WBS, LLC, a consolidated subsidiary, which is the beneficiary of more than 25% of the voting securities of WBS Group LLC and thus a controlled investment.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The accompanying notes are an integral part of these consolidated
financial statements.



12



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##### Table of Contents

|                                       |  |                                 |             |  |                         |   |            |                           |  |   |                            |   |  |                             |           |   |                                   |   |             |                |  |   |            |   |  |                |           |  |  |   |         |  |  |   |         | 
|-------------------------------------- |  | ------------------------------- | ----------- |  | ----------------------- | - | ---------- | ------------------------- |  | - | -------------------------- | - |  | --------------------------- | --------- | - | --------------------------------- | - | ----------- | -------------- |  | - | ---------- | - |  | -------------- | --------- |  |  | - | ------- |  |  | - | ------- | 
|                                       |  |                                 |             |  |                         |   |            |                           |  |   |                            |   |  |                             |           |   | Three Months Ended March 31, 2015 |  
|Controlled Investments                 |  | Fair Value at
December 31,
2014 |             |  | Gross
Additions
(Cost)* |   |            | Gross
Reductions
(Cost)** |  |   | Net
Unrealized
Gain (Loss) |   |  | Fair Value at
March 31,2015 |           |   | Net
Realized
Gain (Loss)          |   |             | InterestIncome |  |   | FeeIncome  |   |  | DividendIncome |          
|Bankruptcy Management Solutions, Inc.: |  |                                 |             |  |                         |   |            |                           |  |   |                            |   |  |                             |           |   |                                   |   |             |                |  |   |            |   |  |                |           |  |  |   |         |  |  |   |         | 
|Senior Secured Loan, First Lien, A     |  | $                               | 1,875,837   |  |                         | $ | 7,480      |                           |  | $ | (12,240                    | ) |  | $                           | (7,111    | ) |                                   | $ | 1,863,966   |                |  | $ |           |   |  | $              | 29,236    |  |  | $ | 25,000  |  |  | $ |        | 
|Senior Secured Loan, First Lien, B     |  |                                 | 10,197,193  |  |                         |   | 122,231    |                           |  |   | (75,046                    | ) |  |                             | (111,730  | ) |                                   |   | 10,132,648  |                |  |   |           |   |  |                | 329,732   |  |  |   |        |  |  |   |        | 
|Common Stock                           |  |                                 | 23,997,165  |  |                         |   |           |                           |  |   |                           |   |  |                             | (77,446   | ) |                                   |   | 23,919,719  |                |  |   |           |   |  |                |          |  |  |   |        |  |  |   |        | 
|Warrants                               |  |                                 | 2,206,924   |  |                         |   |           |                           |  |   |                           |   |  |                             | (88,152   | ) |                                   |   | 2,118,772   |                |  |   |           |   |  |                |          |  |  |   |        |  |  |   |        | 
|Gordon Brothers Finance Company:       |  |                                 |             |  |                         |   |            |                           |  |   |                            |   |  |                             |           |   |                                   |   |             |                |  |   |            |   |  |                |           |  |  |   |         |  |  |   |         | 
|Unsecured Debt                         |  |                                 | 71,032,057  |  |                         |   | 9,867,810  |                           |  |   | (10,588,888                | ) |  |                             |          |   |                                   |   | 70,310,979  |                |  |   |           |   |  |                | 2,103,750 |  |  |   |        |  |  |   |        | 
|Preferred Stock                        |  |                                 | 12,985,556  |  |                         |   | 3,099,542  |                           |  |   |                           |   |  |                             |          |   |                                   |   | 16,085,098  |                |  |   |           |   |  |                |          |  |  |   | 125,683 |  |  |   | 468,263 | 
|Common Stock                           |  |                                 | 10,598,300  |  |                         |   |           |                           |  |   |                           |   |  |                             | (87,630   | ) |                                   |   | 10,510,670  |                |  |   |           |   |  |                |          |  |  |   |        |  |  |   |        | 
|Red Apple Stores Inc.:                 |  |                                 |             |  |                         |   |            |                           |  |   |                            |   |  |                             |           |   |                                   |   |             |                |  |   |            |   |  |                |           |  |  |   |         |  |  |   |         | 
|Unsecured Debt                         |  |                                 | 3,273,054   |  |                         |   | 130,138    |                           |  |   | (6,582,092                 | ) |  |                             | 3,178,900 |   |                                   |   |            |               |  |   | (6,377,901 | ) |  |                | 130,138   |  |  |   |        |  |  |   |        | 
|Senior Secured Loan                    |  |                                 | 21,800,000  |  |                         |   | 1,250,000  |                           |  |   |                           |   |  |                             |          |   |                                   |   | 23,050,000  |                |  |   |           |   |  |                | 598,598   |  |  |   |        |  |  |   |        | 
|Preferred Stock                        |  |                                 |            |  |                         |   | 233,686    |                           |  |   |                           |   |  |                             | (28,609   | ) |                                   |   | 205,077     |                |  |   |           |   |  |                |          |  |  |   |        |  |  |   | 29,494  | 
|Common Stock                           |  |                                 |            |  |                         |   |           |                           |  |   | (665,783                   | ) |  |                             | 665,783   |   |                                   |   |            |                |  |   |           |   |  |                |          |  |  |   |        |  |  |   |        | 
|WBS Group LLC:                         |  |                                 |             |  |                         |   |            |                           |  |   |                            |   |  |                             |           |   |                                   |   |             |                |  |   |            |   |  |                |           |  |  |   |         |  |  |   |         | 
|Senior Secured Loan, First Lien        |  |                                 | 27,284,255  |  |                         |   |           |                           |  |   |                           |   |  |                             |          |   |                                   |   | 27,284,255  |                |  |   |           |   |  |                | 648,001   |  |  |   |        |  |  |   |        | 
|Senior Secured Loan, Second Lien       |  |                                 | 20,249,190  |  |                         |   | 44,556     |                           |  |   |                           |   |  |                             | (544,536  | ) |                                   |   | 19,749,210  |                |  |   |           |   |  |                | 700,780   |  |  |   |        |  |  |   |        | 
|Limited Liability Co. Interest         |  |                                 |            |  |                         |   |           |                           |  |   |                           |   |  |                             |          |   |                                   |   |            |                |  |   |           |   |  |                |          |  |  |   |        |  |  |   |        | 
|Westward Dough Operating Company, LLC  |  |                                 |             |  |                         |   |            |                           |  |   |                            |   |  |                             |           |   |                                   |   |             |                |  |   |            |   |  |                |           |  |  |   |         |  |  |   |         | 
|Senior Secured Loan                    |  |                                 | 6,590,896   |  |                         |   |           |                           |  |   |                           |   |  |                             |          |   |                                   |   | 6,590,896   |                |  |   |           |   |  |                | 148,295   |  |  |   |        |  |  |   |        | 
|Westward Dough Holdings, LLC           |  |                                 |             |  |                         |   |            |                           |  |   |                            |   |  |                             |           |   |                                   |   |             |                |  |   |            |   |  |                |           |  |  |   |         |  |  |   |         | 
|Limited Liability Co. Interest         |  |                                 | 2,233,000   |  |                         |   |           |                           |  |   |                           |   |  |                             | 98,000    |   |                                   |   | 2,331,000   |                |  |   |           |   |  |                |          |  |  |   |        |  |  |   |        | 
|                                       |  |                                 |             | 
|Totals                                 |  | $                               | 214,323,427 |  |                         | $ | 14,755,443 |                           |  | $ | (17,924,049                | ) |  | $                           | 2,997,469 |   |                                   | $ | 214,152,290 |                |  | $ | (6,377,901 | ) |  | $              | 4,688,530 |  |  | $ | 150,683 |  |  | $ | 497,757 | 
|                                       |  |                                 |             | 



| | * | Gross additions include increases in the cost basis of investments resulting from new portfolio investments, PIK interest or dividends, the amortization of unearned income, the exchange of one or more existing
securities for one or more new securities and the movement of an existing portfolio company into this category from a different category.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | ** | Gross reductions include decreases in the cost basis of investments resulting from principal collections related to investment repayments or sales, the exchange of one or more existing securities for one or more new
securities and the movement of an existing portfolio company out of this category into a different category.
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Investment no longer held at March 31, 2015.
| | - | --------------------------------------------

The aggregate fair value of controlled
investments at March 31, 2015 represents 27.1% of the Companys net assets.







| | (n) | Security bears interest at a floating rate that may or may not include an interest rate floor.
| | --- | ----------------------------------------------------------------------------------------------

| | (o) | Interest may be paid in cash or PIK, or a combination thereof which is generally at the option of the borrower. PIK earned is included in the cost basis of the security. PIK represented approximately 2.2% of interest
income earned for the three months ended March 31, 2015. In accordance with the Companys policy, PIK may be recorded on an effective yield basis.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (p) | This investment is deemed significant under the SEC Rule 4-08(g). At March 31, 2015 total assets of Gordon Brothers Finance Company were $253.2 million and net loss for the three months ended March 31, 2015
was $1.2 million. Gordon Brothers Finance Company commenced operations on October 31, 2014.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The accompanying notes are
an integral part of these consolidated financial statements.



13



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##### Table of Contents

BlackRock Capital Investment Corporation

Consolidated Schedules of Investments

December 31, 2014



|                                                    |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|--------------------------------------------------- |  | ------------------ |  | ------------- |  | -------- |  | ------------------------------------------ | ---------- |  | ------- | - | ----------- | ------------- |  | - | ----------- | 
|Portfolio Company                                   |  | Industry(a)        |  | Interest Rate |  | Maturity |  | Principal
Amount or
Number of
Shares/Units |            |  | Cost(b) |   |             | Fair
Value(c) | 
|Senior Secured Notes13.0%                          |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Advanced Lighting Technologies, Inc., First Lien(j) |  | Lighting           |  | 10.50%        |  | 6/1/19   |  | $                                          | 20,000,000 |  |         | $ | 19,661,100  |               |  | $ | 16,000,000  | 
|AGY Holding Corp., Second Lien(e)(j)                |  | GlassYarns/Fibers  |  | 11.00%        |  | 12/15/16 |  |                                            | 21,762,500 |  |         |   | 20,262,404  |               |  |   | 20,021,500  | 
|American Piping Products, Inc., Second Lien(j)      |  | Distribution       |  | 12.88%        |  | 11/15/17 |  |                                            | 10,000,000 |  |         |   | 9,878,458   |               |  |   | 10,200,000  | 
|BPA Laboratories Inc., First Lien(j)                |  | HealthcareServices |  | 12.25%        |  | 4/1/17   |  |                                            | 35,078,000 |  |         |   | 34,506,945  |               |  |   | 35,078,000  | 
|New Gulf Resources, LLC, First Lien(j)              |  | Energy             |  | 11.75%        |  | 5/15/19  |  |                                            | 21,000,000 |  |         |   | 20,830,917  |               |  |   | 20,160,000  | 
|                                                    |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Total Senior Secured Notes                          |  |                    |  |               |  |          |  |                                            |            |  |         |   | 105,139,824 |               |  |   | 101,459,500 | 
|                                                    |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Unsecured Debt22.3%                                |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Gordon Brothers Finance Company(g)(o)(q)            |  | SpecialtyFinance   |  | 12.00%        |  | 10/31/21 |  |                                            | 71,032,057 |  |         |   | 71,032,057  |               |  |   | 71,032,057  | 
|Higginbotham Insurance Holdings, Inc.(o)            |  | Insurance          |  | 9.75%         |  | 6/11/19  |  |                                            | 36,750,000 |  |         |   | 36,750,000  |               |  |   | 36,750,000  | 
|QHB Holdings LLC(p)                                 |  | Materials          |  | 16.00%        |  | 12/17/19 |  |                                            | 20,000,000 |  |         |   | 20,000,000  |               |  |   | 20,000,000  | 
|Red Apple Stores Inc.(g)(h)(k)(p)                   |  | DiscountStores     |  | 18.00%        |  | 7/11/17  |  |                                            | 6,546,107  |  |         |   | 6,451,954   |               |  |   | 3,273,054   | 
|SVP Worldwide Ltd.(h)(k)(p)                         |  | ConsumerProducts   |  | 14.00%        |  | 6/27/18  |  |                                            | 44,619,592 |  |         |   | 44,619,592  |               |  |   | 43,504,102  | 
|                                                    |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Total Unsecured Debt                                |  |                    |  |               |  |          |  |                                            |            |  |         |   | 178,853,603 |               |  |   | 174,559,213 | 
|                                                    |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Subordinated Debt6.4%                              |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Advantage Insurance Holdings Ltd.(e)(h)(j)(k)       |  | Insurance          |  | 12.00%        |  | 9/30/15  |  |                                            | 3,000,000  |  |         |   | 3,000,000   |               |  |   | 3,000,000   | 
|Automobile Protection CorporationAPCO(o)           |  | Insurance          |  | 9.76%         |  | 6/17/19  |  |                                            | 25,000,000 |  |         |   | 25,000,000  |               |  |   | 25,000,000  | 
|New Gulf Resources, LLC(j)(p)                       |  | Energy             |  | 12.00%        |  | 11/15/19 |  |                                            | 4,248,000  |  |         |   | 3,766,802   |               |  |   | 2,124,000   | 
|The Pay-O-Matic Corp.(p)                            |  | FinancialServices  |  | 14.00%        |  | 9/30/16  |  |                                            | 20,400,000 |  |         |   | 20,400,000  |               |  |   | 20,400,000  | 
|                                                    |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Total Subordinated Debt                             |  |                    |  |               |  |          |  |                                            |            |  |         |   | 52,166,802  |               |  |   | 50,524,000  | 
|                                                    |  |                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 



The accompanying
notes are an integral part of these consolidated financial statements.



14



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##### Table of Contents

BlackRock Capital Investment Corporation

Consolidated Schedules of Investments(Continued)

December 31, 2014



|                                                                     |  |                        |  |               |  |          |  |                                            |            |  |         |   |            |               |  |   |            | 
|-------------------------------------------------------------------- |  | ---------------------- |  | ------------- |  | -------- |  | ------------------------------------------ | ---------- |  | ------- | - | ---------- | ------------- |  | - | ---------- | 
|Portfolio Company                                                    |  | Industry(a)            |  | Interest Rate |  | Maturity |  | Principal
Amount or
Number of
Shares/Units |            |  | Cost(b) |   |            | Fair
Value(c) | 
|Senior Secured Loans85.1%(f)                                        |  |                        |  |               |  |          |  |                                            |            |  |         |   |            |               |  |   |            | 
|Accriva Diagnostics, Inc., First Lien                                |  | Healthcare             |  | 12.25%        |  | 1/17/19  |  | $                                          | 21,000,000 |  |         | $ | 21,000,000 |               |  | $ | 21,000,000 | 
|AGY Holding Corp., Second Lien(e)                                    |  | GlassYarns/Fibers      |  | 12.00%        |  | 9/15/16  |  |                                            | 19,763,384 |  |         |   | 19,763,384 |               |  |   | 19,763,384 | 
|AL Solutions, Inc., Term Loan B, Second Lien(p)                      |  | Metals                 |  | 5.00%         |  | 12/31/19 |  |                                            | 74,702     |  |         |   |           |               |  |   |           | 
|Bankruptcy Management Solutions, Inc., Term Loan A, First Lien(g)(o) |  | FinancialServices      |  | 4.50%         |  | 6/27/17  |  |                                            | 1,933,852  |  |         |   | 1,864,788  |               |  |   | 1,875,837  | 
|Bankruptcy Management Solutions, Inc., Term Loan B, First Lien(g)(o) |  | FinancialServices      |  | 7.00%         |  | 6/27/18  |  |                                            | 11,857,195 |  |         |   | 10,297,730 |               |  |   | 10,197,193 | 
|GSE Environmental, Inc., First Lien(o)                               |  | Manufacturing          |  | 11.00%        |  | 8/11/21  |  |                                            | 42,352,941 |  |         |   | 42,352,941 |               |  |   | 42,352,941 | 
|Hunter Defense Technologies, Inc., Second Lien(o)                    |  | Defense                |  | 11.00%        |  | 2/5/20   |  |                                            | 45,000,000 |  |         |   | 45,000,000 |               |  |   | 45,000,000 | 
|JLL Pioneer Inc., Second Lien(o)                                     |  | BuildingProducts       |  | 9.50%         |  | 12/31/20 |  |                                            | 20,000,000 |  |         |   | 20,000,000 |               |  |   | 20,000,000 | 
|K2 Pure Solutions Nocal, L.P. First Lien(o)                          |  | Chemicals              |  | 10.00%        |  | 8/19/19  |  |                                            | 19,750,000 |  |         |   | 19,446,168 |               |  |   | 19,750,000 | 
|Learfield Communications, Inc., Second Lien(o)                       |  | Media andEntertainment |  | 8.75%         |  | 10/9/21  |  |                                            | 3,000,000  |  |         |   | 2,977,889  |               |  |   | 2,977,889  | 
|MD America Energy, LLC, First Lien(o)                                |  | Energy                 |  | 9.50%         |  | 8/4/19   |  |                                            | 20,000,000 |  |         |   | 19,078,302 |               |  |   | 19,600,000 | 
|MediMedia USA, Inc., First Lien(o)                                   |  | InformationServices    |  | 8.00%         |  | 11/20/18 |  |                                            | 14,825,358 |  |         |   | 14,616,580 |               |  |   | 14,825,358 | 
|MediMedia USA, Inc., Second Lien(o)                                  |  | InformationServices    |  | 12.25%        |  | 11/20/19 |  |                                            | 60,000,000 |  |         |   | 58,643,192 |               |  |   | 58,200,000 | 
|Novolex Holdings, Inc., Second Lien(o)                               |  | Manufacturing          |  | 9.75%         |  | 6/5/22   |  |                                            | 5,000,000  |  |         |   | 4,875,369  |               |  |   | 4,875,369  | 
|Oxford Mining Company, LLC, First Lien(o)(p)                         |  | Energy                 |  | 12.25%        |  | 12/31/18 |  |                                            | 14,830,508 |  |         |   | 14,830,508 |               |  |   | 14,830,508 | 
|Pre-Paid Legal Services, Inc., Second Lien(o)                        |  | LegalServices          |  | 9.75%         |  | 7/1/20   |  |                                            | 25,000,000 |  |         |   | 24,704,338 |               |  |   | 25,000,000 | 
|Quality Home Brands Holdings LLC, Second Lien(o)                     |  | Materials              |  | 11.75%        |  | 6/17/19  |  |                                            | 40,000,000 |  |         |   | 40,000,000 |               |  |   | 40,000,000 | 
|Red Apple Stores Inc., Second Lien(g)(h)(k)                          |  | DiscountStores         |  | 16.00%        |  | 1/11/17  |  |                                            | 21,800,000 |  |         |   | 21,800,000 |               |  |   | 21,800,000 | 
|Road Infrastructure Investment, LLC, Second Lien(o)                  |  | Manufacturing          |  | 7.75%         |  | 9/30/21  |  |                                            | 9,000,000  |  |         |   | 8,266,249  |               |  |   | 8,266,249  | 
|Royal Adhesives and Sealants, LLC, Second Lien(o)                    |  | Chemicals              |  | 9.75%         |  | 1/31/19  |  |                                            | 6,000,000  |  |         |   | 5,911,071  |               |  |   | 6,047,498  | 
|Shoreline Energy LLC, Second Lien(o)                                 |  | Energy                 |  | 10.25%        |  | 3/30/19  |  |                                            | 28,750,000 |  |         |   | 28,082,037 |               |  |   | 27,168,749 | 



The accompanying
notes are an integral part of these consolidated financial statements.



15



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##### Table of Contents

BlackRock Capital Investment Corporation

Consolidated Schedules of Investments(Continued)

December 31, 2014



|                                                        |  |                                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|------------------------------------------------------- |  | ---------------------------------- |  | ------------- |  | -------- |  | ------------------------------------------ | ---------- |  | ------- | - | ----------- | ------------- |  | - | ----------- | 
|Portfolio Company                                       |  | Industry(a)                        |  | Interest Rate |  | Maturity |  | Principal
Amount or
Number of
Shares/Units |            |  | Cost(b) |   |             | Fair
Value(c) | 
|SOURCEHOV, LLC, First Lien(o)                           |  | BusinessServices                   |  | 7.75%         |  | 10/31/19 |  | $                                          | 5,000,000  |  |         | $ | 4,854,264   |               |  | $ | 4,854,264   | 
|SOURCEHOV, LLC, Second Lien(o)                          |  | BusinessServices                   |  | 11.50%        |  | 4/30/20  |  |                                            | 5,000,000  |  |         |   | 4,802,376   |               |  |   | 4,802,376   | 
|Sur La Table, Inc., First Lien                          |  | ConsumerProducts                   |  | 12.00%        |  | 7/28/17  |  |                                            | 50,000,000 |  |         |   | 50,000,000  |               |  |   | 50,500,000  | 
|U.S. Well Services, LLC, First Lien(o)                  |  | Energy                             |  | 12.00%        |  | 5/2/19   |  |                                            | 43,395,839 |  |         |   | 43,395,839  |               |  |   | 43,395,839  | 
|United Subcontractors, Inc., First Lien(e)(o)(p)        |  | Building andConstruction           |  | 4.26%         |  | 6/30/15  |  |                                            | 6,349,276  |  |         |   | 6,295,586   |               |  |   | 6,349,276   | 
|Vertellus Specialties Inc., First Lien(o)               |  | SpecialtyChemicals                 |  | 10.50%        |  | 10/31/19 |  |                                            | 54,862,500 |  |         |   | 54,862,500  |               |  |   | 54,862,500  | 
|Water Pik, Inc., Second Lien(o)                         |  | ConsumerProducts                   |  | 9.75%         |  | 1/8/21   |  |                                            | 22,868,421 |  |         |   | 22,195,683  |               |  |   | 22,868,421  | 
|WBS Group LLC, First Lien(g)(o)                         |  | Software                           |  | 9.50%         |  | 6/30/15  |  |                                            | 27,284,255 |  |         |   | 27,284,255  |               |  |   | 27,284,255  | 
|WBS Group LLC, Second Lien(g)(o)                        |  | Software                           |  | 10.50%        |  | 12/31/15 |  |                                            | 24,999,000 |  |         |   | 24,833,200  |               |  |   | 20,249,190  | 
|Westward Dough Operating Company, LLC, First Lien(g)    |  | Restaurants                        |  | 9.00%         |  | 3/2/17   |  |                                            | 6,590,896  |  |         |   | 6,590,896   |               |  |   | 6,590,896   | 
|                                                        |  |                                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Total Senior Secured Loans                              |  |                                    |  |               |  |          |  |                                            |            |  |         |   | 668,625,145 |               |  |   | 665,287,992 | 
|                                                        |  |                                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Preferred Stock5.2%                                    |  |                                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Advantage Insurance Holdings Ltd.(e)(h)(j)(k)           |  | Insurance                          |  | 8.00%         |  |          |  |                                            | 750,000    |  |         |   | 8,215,588   |               |  |   | 8,379,450   | 
|KAGY Holding Company, Inc. (AGY Holding Corp.)(e)       |  | GlassYarns/Fibers                  |  | 20.00%        |  |          |  |                                            | 22,960     |  |         |   | 5,954,917   |               |  |   | 3,266,124   | 
|Gordon Brothers Finance Company(g)(q)                   |  | SpecialtyFinance                   |  | 13.50%        |  |          |  |                                            | 12,986     |  |         |   | 12,985,556  |               |  |   | 12,985,556  | 
|Progress Financial Corporation,Series F-1(d)            |  | FinancialServices                  |  |               |  |          |  |                                            | 963,710    |  |         |   | 740,313     |               |  |   | 2,842,945   | 
|Progress Financial Corporation,Series G(d)              |  | FinancialServices                  |  |               |  |          |  |                                            | 1,758,256  |  |         |   | 2,013,112   |               |  |   | 5,186,855   | 
|USI Senior Holdings, Inc. (United Subcontractors)(d)(e) |  | Building andConstruction           |  |               |  |          |  |                                            | 260,798    |  |         |   | 5,374,317   |               |  |   | 7,823,940   | 
|                                                        |  |                                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Total Preferred Stock                                   |  |                                    |  |               |  |          |  |                                            |            |  |         |   | 35,283,803  |               |  |   | 40,484,870  | 
|                                                        |  |                                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Common Stock13.7%(d)                                   |  |                                    |  |               |  |          |  |                                            |            |  |         |   |             |               |  |   |             | 
|Bankruptcy Management Solutions, Inc.(g)                |  | FinancialServices                  |  |               |  |          |  |                                            | 368,790    |  |         |   | 16,654,505  |               |  |   | 23,997,165  | 
|DynaVox Inc.(l)                                         |  | AugmentativeCommunication
Products |  |               |  |          |  |                                            | 272,369    |  |         |   | 758,069     |               |  |   | 13,618      | 



The accompanying
notes are an integral part of these consolidated financial statements.



16



---

##### Table of Contents

BlackRock Capital Investment Corporation

Consolidated Schedules of Investments(Continued)

December 31, 2014



|                                                              |  |                          |  |               |  |          |            |                                            |           |  |            |   |            |               |  |   |             | 
|------------------------------------------------------------- |  | ------------------------ |  | ------------- |  | -------- | ---------- | ------------------------------------------ | --------- |  | ---------- | - | ---------- | ------------- |  | - | ----------- | 
|Portfolio Company                                             |  | Industry(a)              |  | Interest Rate |  | Maturity |            | Principal
Amount or
Number of
Shares/Units |           |  | Cost(b)    |   |            | Fair
Value(c) | 
|Gordon Brothers Finance Company(g)(q)                         |  | SpecialtyFinance         |  |               |  |          |            |                                            | 10,598    |  |            | $ | 10,598,300 |               |  | $ | 10,598,300  | 
|M & M Tradition Holdings Corp.(e)                             |  | Sheet MetalFabrication   |  |               |  |          |            |                                            | 500,000   |  |            |   | 5,000,000  |               |  |   | 13,500,000  | 
|Red Apple Stores Inc.(g)(h)(i)(k)                             |  | DiscountStores           |  |               |  |          |            |                                            | 8,756,859 |  |            |   | 7,561,626  |               |  |   |            | 
|Tygem Holdings, Inc., Class A                                 |  | Metals                   |  |               |  |          |            |                                            | 30,000    |  |            |   |           |               |  |   |            | 
|USI Senior Holdings, Inc. (United Subcontractors)(e)          |  | Building andConstruction |  |               |  |          |            |                                            | 260,798   |  |            |   | 9,019,888  |               |  |   | 58,869,933  | 
|                                                              |  |                          |  |               |  |          |            |                                            |           |  |            |   |            |               |  |   |             | 
|Total Common Stock                                            |  |                          |  |               |  |          |            |                                            |           |  |            |   | 49,592,388 |               |  |   | 106,979,016 | 
|                                                              |  |                          |  |               |  |          |            |                                            |           |  |            |   |            |               |  |   |             | 
|Limited Partnership/Limited Liability Company Interests12.6% |  |                          |  |               |  |          |            |                                            |           |  |            |   |            |               |  |   |             | 
|ECI Cayman Holdings, LP(d)(h)(j)(k)                           |  | Electronics              |  |               |  |          |            |                                            | 3,184     |  |            |   | 3,183,840  |               |  |   | 3,916,766   | 
|Higginbotham Investment Holdings, LLC(d)                      |  | Insurance                |  |               |  |          |            |                                            | 1,163     |  |            |   | 726,745    |               |  |   | 1,932,559   | 
|Marquette Transportation Company Holdings, LLC(d)(m)          |  | Transportation           |  |               |  |          |            |                                            | 25,000    |  |            |   | 5,000,000  |               |  |   | 8,841,000   | 
|Marsico Holdings, LLC(d)(j)                                   |  | FinancialServices        |  |               |  |          |            |                                            | 91,445    |  |            |   | 1,848,077  |               |  |   | 5,487       | 
|Penton Business Media Holdings, LLC(d)(e)                     |  | InformationServices      |  |               |  |          |            |                                            | 226       |  |            |   | 9,050,000  |               |  |   | 70,182,000  | 
|PG Holdco, LLC                                                |  | HealthcareServices       |  | 15.00%        |  |          |            |                                            | 333       |  |            |   | 495,388    |               |  |   | 495,388     | 
|PG Holdco, LLC, Class A(d)                                    |  | HealthcareServices       |  |               |  |          |            |                                            | 16,667    |  |            |   | 166,667    |               |  |   | 613,806     | 
|Sentry Security Systems Holdings, LLC(d)                      |  | SecurityServices         |  |               |  |          |            |                                            | 147,271   |  |            |   | 147,271    |               |  |   | 20,618      | 
|Sentry Security Systems Holdings, LLC                         |  | SecurityServices         |  | 8.00%         |  |          |            |                                            | 602,729   |  |            |   | 1,106,660  |               |  |   | 1,106,660   | 
|U.S. Well Services, LLC(j)(r)                                 |  | Energy                   |  | 8.00%         |  |          |            |                                            | 8,000     |  |            |   | 8,078,222  |               |  |   | 9,244,444   | 
|WBS Group LLC(d)(g)(n)                                        |  | Software                 |  |               |  |          |            |                                            | 100       |  |            |   | 1,000      |               |  |   |            | 
|Westward Dough Holdings, LLC, Class A(d)(g)                   |  | Restaurants              |  |               |  |          |            |                                            | 350,000   |  |            |   | 9,260,324  |               |  |   | 2,233,000   | 
|                                                              |  |                          |  |               |  |          |            |                                            |           |  |            |   |            |               |  |   |             | 
|Total Limited Partnership/Limited Liability Company Interests |  |                          |  |               |  |          | 39,064,194 |                                            |           |  | 98,591,728 |  
|                                                              |  |                          |  |               |  |          |            |                                            |           |  |            |   |            |               |  |   |             | 



The accompanying
notes are an integral part of these consolidated financial statements.



17



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##### Table of Contents

BlackRock Capital Investment Corporation

Consolidated Schedules of Investments(Continued)

December 31, 2014



|                                                             |  |                   |  |               |  |                 |  |                                            |           |  |              |   |               |               |  |   |               | 
|------------------------------------------------------------ |  | ----------------- |  | ------------- |  | --------------- |  | ------------------------------------------ | --------- |  | ------------ | - | ------------- | ------------- |  | - | ------------- | 
|Portfolio Company                                            |  | Industry(a)       |  | Interest Rate |  | Maturity        |  | Principal
Amount or
Number of
Shares/Units |           |  | Cost(b)      |   |               | Fair
Value(c) | 
|Equity Warrants/Options2.5%(d)                              |  |                   |  |               |  |                 |  |                                            |           |  |              |   |               |               |  |   |               | 
|Bankruptcy Management Solutions, Inc., Tranche A(g)          |  | FinancialServices |  |               |  | expire 6/27/18  |  |                                            | 28,464    |  |              | $ | 375,040       |               |  | $ | 711,315       | 
|Bankruptcy Management Solutions, Inc., Tranche B(g)          |  | FinancialServices |  |               |  | expire 6/27/19  |  |                                            | 30,654    |  |              |   | 342,295       |               |  |   | 638,523       | 
|Bankruptcy Management Solutions, Inc., Tranche C(g)          |  | FinancialServices |  |               |  | expire 6/27/20  |  |                                            | 45,981    |  |              |   | 468,803       |               |  |   | 857,086       | 
|Facet Investment, Inc.                                       |  | MedicalDevices    |  |               |  | expire 1/18/21  |  |                                            | 1,978     |  |              |   | 250,000       |               |  |   |              | 
|Marsico Parent Superholdco, LLC(j)                           |  | FinancialServices |  |               |  | expire 12/14/19 |  |                                            | 455       |  |              |   | 444,450       |               |  |   |              | 
|New Gulf Resources, LLC(j)                                   |  | Energy            |  |               |  | expire 5/9/24   |  |                                            | 4,000     |  |              |   | 506,505       |               |  |   |              | 
|Progress Financial Corporation                               |  | FinancialServices |  |               |  | expire various  |  |                                            | 6,959,220 |  |              |   | 3,183,106     |               |  |   | 17,054,745    | 
|Twin River Worldwide Holdings, Inc., Contingent Value Rights |  | Gaming            |  |               |  | expire 11/5/17  |  |                                            | 1,000     |  |              |   | 5,000         |               |  |   | 568,750       | 
|                                                             |  |                   |  |               |  |                 |  |                                            |           |  |              |   |               |               |  |   |               | 
|Total Equity Warrants/Options                                |  |                   |  |               |  |                 |  |                                            |           |  |              |   | 5,575,199     |               |  |   | 19,830,419    | 
|                                                             |  |                   |  |               |  |                 |  |                                            |           |  |              |   |               |               |  |   |               | 
|TOTAL INVESTMENTS160.8%                                     |  |                   |  |               |  |                 |  |                                            |           |  |              | $ | 1,134,300,958 |               |  |   | 1,257,716,738 | 
|                                                             |  |                   |  |               |  |                 |  |                                            |           |  |              |   |               |               |  |   |               | 
|OTHER ASSETS & LIABILITIES (NET)(60.8)%                     |  |                   |  |               |  |                 |  |                                            |           |  | (475,757,570 | )
|                                                             |  |                   |  |               |  |                 |  |                                            |           |  |              |   |               |               |  |   |               | 
|NET ASSETS100.0%                                            |  |                   |  |               |  |                 |  |                                            |           |  |              |   |               |               |  | $ | 781,959,168   | 
|                                                             |  |                   |  |               |  |                 |  |                                            |           |  |              |   |               |               |  |   |               | 



| | (a) | Unaudited
| | --- | ---------

| | (b) | Represents amortized cost for fixed income securities and cost for preferred and common stock, limited partnership/limited liability company interests and equity warrants/options.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (c) | Fair value is determined by or under the direction of the Companys Board of Directors. See Note 2 for further details.
| | --- | -----------------------------------------------------------------------------------------------------------------------

| | (d) | Non-income producing securities at December 31, 2014.
| | --- | -----------------------------------------------------

| | (e) | Transaction and other information for non-controlled, affiliated investments under the Investment Company Act of 1940, whereby the Company owns 5% or more (but not more than 25%) of the portfolio
companys outstanding voting securities.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (f) | Approximately 82% of the senior secured loans of the Companys portfolio companies bear interest at a floating rate that may be determined by reference to the London Interbank Offered Rate (LIBOR) or other base
rate (commonly the Federal Funds Rate or the Prime Rate), at the borrowers option. In addition, approximately 81% of such senior secured loans have floors of 0.50% to 1.50%. The borrower under a senior secured loan generally has the option to
select from interest reset periods of one, two, three or six months and may alter that selection at the end of any reset period. The stated interest rate represents the weighted average interest rate at December 31, 2014 of all contracts within
the specified loan facility.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The accompanying notes are an integral part of these consolidated financial statements.



18



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##### Table of Contents

|                                                           |  |                               |             |  |                       |   |            |                         |  |   |                          |   |  |                               |            |   |                                      |   |             |                |  |   |            |  |  |                |           |  |  |   |   |  |  |   |           | 
|---------------------------------------------------------- |  | ----------------------------- | ----------- |  | --------------------- | - | ---------- | ----------------------- |  | - | ------------------------ | - |  | ----------------------------- | ---------- | - | ------------------------------------ | - | ----------- | -------------- |  | - | ---------- |  |  | -------------- | --------- |  |  | - | - |  |  | - | --------- | 
|                                                           |  |                               |             |  |                       |   |            |                         |  |   |                          |   |  |                               |            |   | For the Year Ended December 31, 2014 |  
|Non-controlled, Affiliated Investments                     |  | Fair Value atDecember 31,2013 |             |  | GrossAdditions(Cost)* |   |            | GrossReductions(Cost)** |  |   | NetUnrealizedGain
(Loss) |   |  | FairValue atDecember 31,
2014 |            |   | NetRealizedGain(Loss)                |   |             | InterestIncome |  |   | FeeIncome  |  |  | DividendIncome |          
|Advantage Insurance Holdings Ltd.:                         |  |                               |             |  |                       |   |            |                         |  |   |                          |   |  |                               |            |   |                                      |   |             |                |  |   |            |  |  |                |           |  |  |   |   |  |  |   |           | 
|Subordinated Debt                                          |  | $                             |            |  |                       | $ | 7,395,373  |                         |  | $ | (4,395,373               | ) |  | $                             |           |   |                                      | $ | 3,000,000   |                |  | $ |           |  |  | $              | 264,518   |  |  | $ |  |  |  | $ |          | 
|Preferred Stock                                            |  |                               | 5,100,822   |  |                       |   | 3,114,766  |                         |  |   |                         |   |  |                               | 163,862    |   |                                      |   | 8,379,450   |                |  |   |           |  |  |                |          |  |  |   |  |  |  |   | 489,764   | 
|AGY Holding Corp.:                                         |  |                               |             |  |                       |   |            |                         |  |   |                          |   |  |                               |            |   |                                      |   |             |                |  |   |            |  |  |                |           |  |  |   |   |  |  |   |           | 
|Senior Secured Note                                        |  |                               | 19,151,000  |  |                       |   | 799,894    |                         |  |   |                         |   |  |                               | 70,606     |   |                                      |   | 20,021,500  |                |  |   |           |  |  |                | 3,193,769 |  |  |   |  |  |  |   |          | 
|Senior Secured Loan                                        |  |                               | 7,964,650   |  |                       |   | 11,798,734 |                         |  |   |                         |   |  |                               |           |   |                                      |   | 19,763,384  |                |  |   |           |  |  |                | 1,287,111 |  |  |   |  |  |  |   |          | 
|BKC CLO 2014-1, Ltd.                                       |  |                               |             |  |                       |   |            |                         |  |   |                          |   |  |                               |            |   |                                      |   |             |                |  |   |            |  |  |                |           |  |  |   |   |  |  |   |           | 
|Preferred Stock                                            |  |                               |            |  |                       |   | 6,972,000  |                         |  |   | (6,972,000               | ) |  |                               |           |   |                                      |   |            |               |  |   | 423,373    |  |  |                |          |  |  |   |  |  |  |   |          | 
|KAGY Holding Company, Inc. (AGY Holding Corp.)             |  |                               |             |  |                       |   |            |                         |  |   |                          |   |  |                               |            |   |                                      |   |             |                |  |   |            |  |  |                |           |  |  |   |   |  |  |   |           | 
|Preferred Stock                                            |  |                               | 4,732,950   |  |                       |   | 938,398    |                         |  |   |                         |   |  |                               | (2,405,224 | ) |                                      |   | 3,226,124   |                |  |   |           |  |  |                |          |  |  |   |  |  |  |   | 938,396   | 
|M&M Tradition Holdings Corp.                               |  |                               |             |  |                       |   |            |                         |  |   |                          |   |  |                               |            |   |                                      |   |             |                |  |   |            |  |  |                |           |  |  |   |   |  |  |   |           | 
|Common Stock                                               |  |                               | 9,250,000   |  |                       |   |           |                         |  |   |                         |   |  |                               | 4,250,000  |   |                                      |   | 13,500,000  |                |  |   |           |  |  |                |          |  |  |   |  |  |  |   |          | 
|Penton Business Media Holdings, LLC                        |  |                               |             |  |                       |   |            |                         |  |   |                          |   |  |                               |            |   |                                      |   |             |                |  |   |            |  |  |                |           |  |  |   |   |  |  |   |           | 
|Limited Liability Co. Interest                             |  |                               | 36,441,130  |  |                       |   |           |                         |  |   |                         |   |  |                               | 33,740,870 |   |                                      |   | 70,182,000  |                |  |   |           |  |  |                |          |  |  |   |  |  |  |   |          | 
|United Subcontractors, Inc.                                |  |                               |             |  |                       |   |            |                         |  |   |                          |   |  |                               |            |   |                                      |   |             |                |  |   |            |  |  |                |           |  |  |   |   |  |  |   |           | 
|Senior Secured Loan                                        |  |                               | 5,015,119   |  |                       |   | 1,361,655  |                         |  |   |                         |   |  |                               | (27,498    | ) |                                      |   | 6,349,276   |                |  |   |           |  |  |                | 343,999   |  |  |   |  |  |  |   |          | 
|USI Senior Holdings, Inc.:                                 |  |                               |             |  |                       |   |            |                         |  |   |                          |   |  |                               |            |   |                                      |   |             |                |  |   |            |  |  |                |           |  |  |   |   |  |  |   |           | 
|Common Stock                                               |  |                               | 21,575,553  |  |                       |   | 5,205,607  |                         |  |   |                         |   |  |                               | 32,088,773 |   |                                      |   | 58,869,933  |                |  |   |           |  |  |                |          |  |  |   |  |  |  |   |          | 
|Preferred Stock                                            |  |                               | 6,262,254   |  |                       |   | 1,561,682  |                         |  |   |                         |   |  |                               | 4          |   |                                      |   | 7,823,940   |                |  |   |           |  |  |                |          |  |  |   |  |  |  |   |          | 
|VSS-AHC Consolidated Holdings Corp. (Advanstar Global LLC) |  |                               |             |  |                       |   |            |                         |  |   |                          |   |  |                               |            |   |                                      |   |             |                |  |   |            |  |  |                |           |  |  |   |   |  |  |   |           | 
|Preferred Stock                                            |  |                               | 5,208,213   |  |                       |   | 801,577    |                         |  |   | (6,009,790               | ) |  |                               |           |   |                                      |   |            |               |  |   |           |  |  |                |          |  |  |   |  |  |  |   | 801,578   | 
|VSS-AHC Holdings LLC. (Advanstar Global LLC)               |  |                               |             |  |                       |   |            |                         |  |   |                          |   |  |                               |            |   |                                      |   |             |                |  |   |            |  |  |                |           |  |  |   |   |  |  |   |           | 
|Limited Liability Co. Interest                             |  |                               | 13,394,600  |  |                       |   |           |                         |  |   | (6,150,647               | ) |  |                               | (7,243,953 | ) |                                      |   |            |               |  |   | 14,086,551 |  |  |                |          |  |  |   |  |  |  |   |          | 
|                                                           |  |                               |             | 
|Totals                                                     |  | $                             | 134,096,291 |  |                       | $ | 39,949,686 |                         |  | $ | (23,527,810              | ) |  | $                             | 60,637,440 |   |                                      | $ | 211,155,607 |                |  | $ | 14,509,924 |  |  | $              | 5,089,397 |  |  | $ |  |  |  | $ | 2,229,738 | 
|                                                           |  |                               |             | 



| | * | Gross additions include increases in the cost basis of investments resulting from new portfolio investments, payment-in-kind (PIK) interest or dividends, the amortization of unearned income, the exchange of
one or more existing securities for one or more new securities and the movement of an existing portfolio company into this category from a different category.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | ** | Gross reductions include decreases in the cost basis of investments resulting from principal collections related to investment repayments or sales, the exchange of one or more existing securities for one or more new
securities and the movement of an existing portfolio company out of this category into a different category.
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Investment no longer held as of December 31, 2014.
| | - | --------------------------------------------------

The aggregate fair value of
non-controlled, affiliated investments at December 31, 2014 represents 27.0% of the Companys net assets.







| | (g) | Transaction and other information for controlled investments under the Investment Company Act of 1940, whereby the Company owns more than 25% of the portfolio companys outstanding voting securities.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (h) | Non-U.S. company or principal place of business outside the U.S.
| | --- | ----------------------------------------------------------------

| | (i) | Original purchase denominated in Canadian dollars.
| | --- | --------------------------------------------------

| | (j) | Security is exempt from registration under Rule 144A of the Securities Act of 1933. Such securities may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. In the
aggregate, these securities represent 16.4% of the Companys net assets at December 31, 2014.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (k) | BDCs are required to invest at least 70% of their total assets primarily in securities of private or thinly traded U.S. public companies, cash, cash equivalents, U.S. Government securities and other high quality debt
investments that mature in one year or less. The securities referenced represent either fully or partially non-qualified assets for purposes of this requirement.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (l) | During the period DynaVox completed an exchange of the outstanding L.L.C. units into an equivalent number of common shares.
| | --- | ---------------------------------------------------------------------------------------------------------------------------

| | (m) | The Company is the sole stockholder of BKC MTCH Blocker, Inc., a consolidated subsidiary, which is the beneficiary of less than 5% of the voting securities of Marquette Transportation Company Holdings, LLC and thus a
non-controlled, non-affiliated investment.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (n) | The Company is the sole stockholder of BKC-WBS, LLC, a consolidated subsidiary, which is the beneficiary of more than 25% of the voting securities of WBS Group LLC and thus a controlled investment.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The accompanying notes are an integral part of these consolidated
financial statements.



19



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##### Table of Contents

|                                       |  |                               |             |  |                        |   |            |                         |  |   |                           |   |  |                                |             |   |                                      |   |             |                |  |   |            |  |  |                 |            |  |  |   |           |  |  |   |         | 
|-------------------------------------- |  | ----------------------------- | ----------- |  | ---------------------- | - | ---------- | ----------------------- |  | - | ------------------------- | - |  | ------------------------------ | ----------- | - | ------------------------------------ | - | ----------- | -------------- |  | - | ---------- |  |  | --------------- | ---------- |  |  | - | --------- |  |  | - | ------- | 
|                                       |  |                               |             |  |                        |   |            |                         |  |   |                           |   |  |                                |             |   | For the Year Ended December 31, 2014 |  
|Controlled Investments                 |  | Fair Value atDecember 31,2013 |             |  | Gross
Additions(Cost)* |   |            | GrossReductions(Cost)** |  |   | Net
UnrealizedGain (Loss) |   |  | Fair Value atDecember 31,
2014 |             |   | Net
Realized Gain
(Loss)             |   |             | InterestIncome |  |   | Fee
Income |  |  | Dividend
Income |           
|Bankruptcy Management Solutions, Inc.: |  |                               |             |  |                        |   |            |                         |  |   |                           |   |  |                                |             |   |                                      |   |             |                |  |   |            |  |  |                 |            |  |  |   |           |  |  |   |         | 
|Senior Secured Loan, First Lien, A     |  | $                             | 1,596,458   |  |                        | $ | 364,652    |                         |  | $ | (45,314                   | ) |  | $                              | (39,959     | ) |                                      | $ | 1,875,837   |                |  | $ |           |  |  | $               | 113,543    |  |  | $ | 250,000   |  |  | $ |        | 
|Senior Secured Loan, First Lien, B     |  |                               | 10,458,655  |  |                        |   | 513,273    |                         |  |   | (304,033                  | ) |  |                                | (470,702    | ) |                                      |   | 10,197,193  |                |  |   |           |  |  |                 | 1,368,109  |  |  |   |          |  |  |   |        | 
|Common Stock                           |  |                               | 17,242,928  |  |                        |   |           |                         |  |   |                          |   |  |                                | 6,754,237   |   |                                      |   | 23,997,165  |                |  |   |           |  |  |                 |           |  |  |   |          |  |  |   |        | 
|Warrants                               |  |                               | 1,193,880   |  |                        |   |           |                         |  |   |                          |   |  |                                | 1,013,044   |   |                                      |   | 2,206,924   |                |  |   |           |  |  |                 |           |  |  |   |          |  |  |   |        | 
|ECI Holdco, Inc.                       |  |                               |             |  |                        |   |            |                         |  |   |                           |   |  |                                |             |   |                                      |   |             |                |  |   |            |  |  |                 |            |  |  |   |           |  |  |   |         | 
|Common Stock                           |  |                               | 68,604,042  |  |                        |   | 302,973    |                         |  |   | (23,380,670               | ) |  |                                | (45,526,345 | ) |                                      |   |            |               |  |   | 48,129,867 |  |  |                 |           |  |  |   |          |  |  |   |        | 
|Gordon Brothers Finance Company:       |  |                               |             |  |                        |   |            |                         |  |   |                           |   |  |                                |             |   |                                      |   |             |                |  |   |            |  |  |                 |            |  |  |   |           |  |  |   |         | 
|Unsecured Debt                         |  |                               |            |  |                        |   | 71,032,057 |                         |  |   |                          |   |  |                                |            |   |                                      |   | 71,032,057  |                |  |   |           |  |  |                 | 1,467,996  |  |  |   | 2,968,701 |  |  |   |        | 
|Preferred Stock                        |  |                               |            |  |                        |   | 12,985,556 |                         |  |   |                          |   |  |                                |            |   |                                      |   | 12,985,556  |                |  |   |           |  |  |                 |           |  |  |   |          |  |  |   | 301,914 | 
|Common Stock                           |  |                               |            |  |                        |   | 10,598,300 |                         |  |   |                          |   |  |                                |            |   |                                      |   | 10,598,300  |                |  |   |           |  |  |                 |           |  |  |   |          |  |  |   |        | 
|Red Apple Stores Inc.:                 |  |                               |             |  |                        |   |            |                         |  |   |                           |   |  |                                |             |   |                                      |   |             |                |  |   |            |  |  |                 |            |  |  |   |           |  |  |   |         | 
|Unsecured Debt                         |  |                               | 5,454,365   |  |                        |   | 997,589    |                         |  |   |                          |   |  |                                | (3,178,900  | ) |                                      |   | 3,273,054   |                |  |   |           |  |  |                 | 997,589    |  |  |   |          |  |  |   |        | 
|Senior Secured Loan                    |  |                               | 20,000,000  |  |                        |   | 1,800,000  |                         |  |   |                          |   |  |                                |            |   |                                      |   | 21,800,000  |                |  |   |           |  |  |                 | 3,285,850  |  |  |   |          |  |  |   |        | 
|Common Stock                           |  |                               | 8,242,821   |  |                        |   | 273,127    |                         |  |   | (954,322                  | ) |  |                                | (7,561,626  | ) |                                      |   |            |                |  |   |           |  |  |                 |           |  |  |   |          |  |  |   |        | 
|WBS Group LLC:                         |  |                               |             |  |                        |   |            |                         |  |   |                           |   |  |                                |             |   |                                      |   |             |                |  |   |            |  |  |                 |            |  |  |   |           |  |  |   |         | 
|Senior Secured Loan, First Lien        |  |                               | 27,284,255  |  |                        |   |           |                         |  |   |                          |   |  |                                |            |   |                                      |   | 27,284,255  |                |  |   |           |  |  |                 | 1,965,603  |  |  |   |          |  |  |   |        | 
|Senior Secured Loan, Second Lien       |  |                               | 24,999,000  |  |                        |   | 180,930    |                         |  |   |                          |   |  |                                | (4,930,740  | ) |                                      |   | 20,249,190  |                |  |   |           |  |  |                 | 2,788,250  |  |  |   |          |  |  |   |        | 
|Limited Liability Co. Interest         |  |                               | 6,056,783   |  |                        |   |           |                         |  |   |                          |   |  |                                | (6,056,783  | ) |                                      |   |            |                |  |   |           |  |  |                 | 868,021    |  |  |   |          |  |  |   |        | 
|Westward Dough Operating Company, LLC  |  |                               |             |  |                        |   |            |                         |  |   |                           |   |  |                                |             |   |                                      |   |             |                |  |   |            |  |  |                 |            |  |  |   |           |  |  |   |         | 
|Senior Secured Loan                    |  |                               | 6,656,805   |  |                        |   |           |                         |  |   |                          |   |  |                                | (65,909     | ) |                                      |   | 6,590,896   |                |  |   |           |  |  |                 | 438,661    |  |  |   |          |  |  |   |        | 
|Westward Dough Holdings, LLC           |  |                               |             |  |                        |   |            |                         |  |   |                           |   |  |                                |             |   |                                      |   |             |                |  |   |            |  |  |                 |            |  |  |   |           |  |  |   |         | 
|Limited Liability Co. Interest         |  |                               | 4,781,000   |  |                        |   |           |                         |  |   |                          |   |  |                                | (2,548,000  | ) |                                      |   | 2,233,000   |                |  |   |           |  |  |                 |           |  |  |   |          |  |  |   |        | 
|                                       |  |                               |             | 
|Totals                                 |  | $                             | 202,570,992 |  |                        | $ | 99,048,457 |                         |  | $ | (24,684,339               | ) |  | $                              | (62,611,683 | ) |                                      | $ | 214,323,427 |                |  | $ | 48,129,867 |  |  | $               | 13,293,622 |  |  | $ | 3,218,701 |  |  | $ | 301,914 | 
|                                       |  |                               |             | 



| | * | Gross additions include increases in the cost basis of investments resulting from new portfolio investments, PIK interest or dividends, the amortization of unearned income, the exchange of one or more existing
securities for one or more new securities and the movement of an existing portfolio company into this category from a different category.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | ** | Gross reductions include decreases in the cost basis of investments resulting from principal collections related to investment repayments or sales, the exchange of one or more existing securities for one or more new
securities and the movement of an existing portfolio company out of this category into a different category.
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Investment no longer held at December 31, 2014.
| | - | -----------------------------------------------

The aggregate fair value of controlled
investments at December 31, 2014 represents 27.4% of the Companys net assets.







| | (o) | Security bears interest at a floating rate that may or may not include an interest rate floor.
| | --- | ----------------------------------------------------------------------------------------------

| | (p) | Interest may be paid in cash or PIK, or a combination thereof which is generally at the option of the borrower. PIK earned is included in the cost basis of the security. PIK represented approximately 2.4% of interest
income earned for the year ended December 31, 2014. In accordance with the Companys policy, PIK may be recorded on an effective yield basis.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (q) | This investment is deemed significant under the SEC Rule 4-08(g). At December 31, 2014 total assets of Gordon Brothers Finance Company were $265.2 million and net income for the period ended December 31, 2014
was $48.0 thousand. Gordon Brothers Finance Company commenced operations on October 31, 2014.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (r) | The Company is the sole stockholder of BKC ASW Blocker, Inc., a consolidated subsidiary, which is the beneficiary of less than 5% of the voting securities of U.S. Well Services, LLC and thus a non-controlled,
non-affiliated investment.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The accompanying notes are
an integral part of these consolidated financial statements.



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##### Table of Contents

BlackRock Capital Investment Corporation

Notes to Consolidated Financial Statements (Unaudited)

1. Organization

BlackRock Capital
Investment Corporation (the Company), formerly known as BlackRock Kelso Capital Corporation and subsidiaries was organized as a Delaware corporation on April 13, 2005 and was initially funded on July 25, 2005. The Company has
elected to be regulated as a business development company (BDC) under the Investment Company Act of 1940 (the 1940 Act). In addition, for tax purposes the Company has qualified and has elected to be treated as a regulated
investment company (RIC) under the Internal Revenue Code of 1986 (the Code).

The Companys investment
objective is to generate both current income and capital appreciation through debt and equity investments. The Company invests primarily in middle-market companies in the form of senior and junior secured and unsecured debt securities and loans,
each of which may include an equity component, and by making direct preferred, common and other equity investments in such companies.

2. Significant
accounting policies

Unaudited Interim Consolidated Financial Statements

The accompanying consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United
States of America (GAAP). The Company is an investment company following the accounting and reporting guidance in Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 946, Financial
Services-Investment Company (ASC 946).

Certain financial information that is normally included in annual financial statements,
including certain financial statement footnotes, prepared in accordance with GAAP, is not required for interim reporting purposes and has been condensed or omitted herein. These consolidated financial statements should be read in conjunction with
the Companys consolidated financial statements and notes related thereto included in the Companys Annual Report on Form 10-K for the year ended December 31, 2014, which was filed with the Securities and Exchange Commission
(SEC) on March 5, 2015.

Basis of Presentation

The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities as of the date of the consolidated financial statements and the reported amounts of income and expenses during the reported period. Changes in the economic environment, financial markets and any other
parameters used in determining these estimates could cause actual results to differ and such differences could be material.

The
accompanying consolidated financial statements include the accounts of the Company and its subsidiaries, which were established to hold certain investments of the Company. The Company owns 100% of each subsidiary and, as such, the subsidiaries
are consolidated into the Companys consolidated financial statements. The subsidiaries hold investments which are treated as pass through entities for tax purposes. By investing through these 100% owned subsidiaries, the Company is able to
benefit from corporate tax treatment for these entities and thereby create a tax structure that is more advantageous with respect to the RIC status of the Company. Transactions between the Company and subsidiaries, to the extent they occur, are
eliminated in consolidation.

Investments

Security transactions are accounted for on the trade date unless there are substantial conditions to the purchase. Realized gains or losses
are measured by the difference between the net proceeds from the sale and the amortized cost basis of the investment. Unrealized gains or losses primarily reflect the change in investment values, including the reversal of previously recorded
unrealized gains or losses when gains or losses are realized. Realized gains or losses on the disposition of investments are calculated using the specific identification method.



21



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##### Table of Contents

Investments for which market quotations are readily available are valued at such market
quotations unless they are deemed not to represent fair value. The Company obtains market quotations, when available, from an independent pricing service or one or more broker-dealers or market makers and utilizes the average of the range of bid and
ask quotations. Debt and equity securities for which market quotations are not readily available or for which market quotations are deemed not to represent fair value are valued at fair value as determined in good faith by or under the direction of
the Companys Board of Directors.

Because the Company expects that there will not be a readily available market for substantially all
of the investments in its portfolio, the Company expects to value substantially all of its portfolio investments at fair value as determined in good faith by or under the direction of the Board of Directors using a consistently applied valuation
process in accordance with a documented valuation policy that has been reviewed and approved by the Board of Directors. Due to the inherent uncertainty and subjectivity of determining the fair value of investments that do not have a readily
available market value, the fair value of the Companys investments may differ significantly from the values that would have been used had a readily available market value existed for such investments and may differ materially from the values
that the Company may ultimately realize.

In addition, changes in the market environment and other events may have differing impacts on the
market quotations used to value some of the Companys investments than on the fair values of the Companys investments for which market quotations are not readily available. Market quotations may be deemed not to represent fair value in
certain circumstances where BlackRock Advisors LLC, the Companys investment advisor (the Advisor), believes that facts and circumstances applicable to an issuer, a seller or purchaser or the market for a particular security cause
current market quotations to not reflect the fair value of the security. Examples of these events could include cases where a security trades infrequently causing a quoted purchase or sale price to become stale, where there is a forced
sale by a distressed seller, where market quotations vary substantially among market makers, or where there is a wide bid-ask spread or significant increase in the bid-ask spread.

With respect to the Companys investments for which market quotations are not readily available or for which market quotations are deemed
not to represent fair value, the Board of Directors has approved a multi-step valuation process applied each quarter, as described below:

(i) The quarterly valuation process begins with each portfolio company or investment being initially evaluated and rated by the investment
professionals of the Advisor responsible for the portfolio investment;

(ii) The investment professionals provide recent portfolio company
financial statements and other reporting materials to independent valuation firms engaged by the Board of Directors, such firms conduct independent appraisals each quarter and their preliminary valuation conclusions are documented and discussed with
senior management of the Advisor;

(iii) The audit committee of the Board of Directors reviews the preliminary valuations prepared by the
independent valuation firms; and

(iv) The Board of Directors discusses valuations and determines the fair value of each investment in the
portfolio in good faith based on the input of the Advisor, the respective independent valuation firms and the audit committee.

Those
investments for which market quotations are not readily available or for which market quotations are deemed not to represent fair value are valued utilizing a market approach, an income approach, or both approaches, as appropriate. The market
approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities (including a business). The income approach uses valuation techniques to convert future amounts (for
example, cash flows or earnings) to a single present amount (discounted). The measurement is based on the value indicated by current market expectations about those future amounts. In following these approaches, the types of factors that the Company
may take into account in determining the fair value of its investments include, as relevant and among other factors: available current market data, including relevant and applicable market trading and transaction comparables, applicable market
yields and multiples, security covenants, call protection provisions, information rights, the nature and realizable



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value of any collateral, the portfolio companys ability to make payments, (e.g. non-performance risk), its earnings and discounted cash flows, the markets in which the portfolio company
does business, comparisons of financial ratios of peer companies that are public, M&A comparables, the Companys principal market (as the reporting entity) and enterprise values.

Until the end of the second calendar quarter following its acquisition, each unquoted investment in a new portfolio company generally is held
at amortized cost, which the Advisor believes approximates fair value under the circumstances. As of that date, an independent valuation firm conducts an initial independent appraisal of the investment.

Accounting Standards Codification (ASC) 820-10, Fair Value Measurements and Disclosures (ASC 820-10),
issued by the Financial Accounting Standards Board (FASB), defines fair value, establishes a framework for measuring fair value and requires disclosures about fair value measurements. See Note 10 for further details.

Cash and Cash Equivalents

Cash equivalents include short-term liquid overnight investments.

Revenue recognition

Interest income is recorded on an accrual basis and includes amortization of premiums and accretion of discounts. Discounts and premiums to
par value on securities purchased are accreted/amortized into interest income over the life of the respective security. Premiums and discounts are determined based on the cash flows expected to be received for a particular investment upon maturity.

Dividend income is recorded on the ex-dividend date and is adjusted to the extent that the Company expects to collect such amounts. For
loans and securities with payment-in-kind (PIK) income, which represents contractual interest or dividends accrued and added to the principal balance and generally due at maturity, such income is accrued only to the extent that the
Advisor believes that the PIK income is likely to be collected. To maintain the Companys status as a RIC, this non-cash source of income must be paid out to stockholders in the form of dividends, even though the Company has not yet collected
the cash.

Fee income, such as structuring fees, origination, closing, commitment and other upfront fees are generally non-recurring and
are recognized as revenue when earned. In instances where the Company does not perform significant services in connection with the related investment, fees paid to the Company may be deferred and amortized over the estimated life of the investment.
Upon the prepayment of a loan or debt security, any prepayment penalties and unamortized loan origination, structuring, closing, commitment and other upfront fees are recorded as income.

U.S. Federal income taxes

The Company has elected to be treated as a RIC under Subchapter M of the Code and operates in a manner so as to qualify for the tax treatment
applicable to RICs.

In order to qualify for favorable tax treatment as a RIC, the Company is required to distribute annually to its
stockholders at least 90% of its investment company taxable income, as defined by the Code. To avoid federal excise taxes, we must distribute annually at least 98% of our ordinary income and 98.2% of net capital gains from the current year and any
undistributed ordinary income and net capital gains from the preceding years. The Company, at its discretion, may carry forward taxable income in excess of calendar year distributions and pay a 4% excise tax on this income. If the Company chooses to
do so, all other things being equal, this would increase expenses and reduce the amount available to be distributed to stockholders. The Company will accrue excise tax on estimated undistributed taxable income as required.



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Distributions from net investment income and distributions from net realized capital gains are
determined in accordance with U.S. federal income tax regulations, which may differ from those amounts determined in accordance with GAAP. These book/tax differences are either temporary or permanent in nature. To the extent these differences are
permanent, they are charged or credited to paid-in-capital or accumulated net realized gain (loss), as appropriate, in the period that the differences arise. Temporary and permanent differences are primarily attributable to differences in the tax
treatment of certain loans and the tax characterization of income and non-deductible expenses. These differences are generally determined in conjunction with the preparation of the Companys annual RIC tax return.

Book and tax basis differences relating to stockholder distributions and other permanent book and tax differences are reclassified among the
Companys capital accounts. In addition, the character of income and gains to be distributed is determined in accordance with income tax regulations that may differ from GAAP.

The Company may pay distributions in excess of its taxable net investment income. This excess would be a tax-free return of capital in the
period and reduce the shareholders tax basis in its shares. The cumulative amount is disclosed on the Consolidated Statements of Assets and Liabilities as distributions in excess of taxable net investment income. Cumulative distributions in
excess of taxable net investment income are $16,733,543 and $15,675,925 as of March 31, 2015 and December 31, 2014, respectively.

Distributions to Common Stockholders

Distributions to common stockholders are recorded on the ex-dividend date. The amount to be paid out as a distribution is determined by the
Board of Directors. Net realized capital gains, if any, generally are distributed at least annually, although the Company may decide to retain such capital gains for investment.

The Company has adopted a dividend reinvestment plan that provides for reinvestment of distributions on behalf of stockholders, unless a
stockholder elects to receive cash. As a result, if the Board of Directors authorizes, and the Company declares, a cash distribution, then stockholders who have not opted out of the dividend reinvestment plan will have their cash
dividends automatically reinvested in additional shares of Common Stock, rather than receiving the cash distributions.

Foreign
Currency

Foreign currency amounts are translated into United States dollars on the following basis:



| | (i) | market value of investment securities, other assets and liabilitiesat the spot exchange rate on the last business day of the period; and
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------



| | (ii) | purchases and sales of investment securities, income and expensesat the rates of exchange prevailing on the respective dates of such transactions, income or expenses.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------

Although net assets and fair values are presented based on the applicable foreign exchange rates described above, the Company does not isolate
that portion of the results of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in fair values of investments held. Such fluctuations are included with the net realized and
unrealized gain or loss from investments.

Investments denominated in foreign currencies and foreign currency transactions may involve
certain considerations and risks not typically associated with those of domestic origin, including unanticipated movements in the value of the foreign currency relative to the U.S. dollar.

Debt Issuance Costs

Debt issuance costs are amortized over the term of the related debt using the straight line method, which approximates the effective interest
rate method.



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Equity Offering Expenses

The Company records registration expenses related to its shelf registration statement and related SEC filings as prepaid assets. These
expenses are charged as a reduction of capital upon utilization, in accordance with ASC 946, Financial ServicesInvestment Companies.

Non-Accrual Loans

Loans or debt securities are placed on non-accrual status, as a general matter, when principal or interest payments are past due 30 days or
more or when there is reasonable doubt that principal or interest will be collected. Accrued interest generally is reversed when a loan or debt security is placed on non-accrual status. Interest payments received on non-accrual loans or debt
securities may be recognized as income or applied to principal depending upon managements judgment. Non-accrual loans and debt securities are restored to accrual status when past due principal and interest is paid and, in managements
judgment, are likely to remain current. The Company may make exceptions to this treatment if the loan has sufficient collateral value and is in the process of collection.

Recently Issued Accounting Pronouncements

In June 2013, the FASB issued ASU No. 2013-08, Financial Services-Investment Companies (Topic 946): Amendments to the Scope,
Measurement, and Disclosure Requirements (ASU 2013-08). ASU 2013-08 changes the approach to the assessment of whether a company is an investment company, clarifies the characteristics of an investment company, provides comprehensive
guidance for the investment company assessment and contains certain disclosure requirements. ASU 2013-08 is effective for interim and annual reporting periods in fiscal years that begin after December 15, 2013. Earlier application is
prohibited. This update was effective for the Company for the year ended December 31, 2013, and did not have a material effect on the Companys consolidated financial statements.

In February 2015, the FASB issued ASU 2015-02, Amendments to the Consolidation Analysis (ASU 2015-02), which significantly
amends the consolidation analysis required under current consolidation guidance. The amendments include changes to: (i) the VIE analysis for limited partnerships; (ii) the criteria for evaluating whether fees paid to a decision maker or a
service provider are a variable interest; (iii) the effect of fee arrangements on the PB determination; (iv) the effect of related parties on the primary beneficiary determination; and (v) the consolidation evaluation for certain
investment funds. This includes a scope exception for reporting entities with interests in legal entities that are required to comply with or operate in accordance with requirements similar to those in Rule 2a-7 of the Investment Company Act of 1940
for registered money market funds.

In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs
(ASU 2015-03), which changes the presentation of debt issuance costs in financial statements. Under ASU 2015-03, an entity presents such costs in the balance sheet as a direct deduction from the related debt liability rather than as an
asset. Amortization of the costs is reported as interest expense.

ASU 2015-02 and ASU 2015-03 are effective for fiscal years, and interim
periods within those fiscal years, beginning after December 15, 2015. ASU 2015-02 and ASU 2015-03 permits early adoption in an interim period with any adjustments reflected as of the beginning of the fiscal year that includes that interim
period. The Company is currently evaluating the impact to the consolidated financial statements of adopting the provisions of ASU 2015-02 and ASU 2015-03.

3. Agreements and related party transactions

Investment management agreement

At a Special Meeting of the Companys Stockholders, held on February 18, 2015, the Companys stockholders approved a new investment management
agreement between the Company and BlackRock Advisors, LLC to



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permit the Advisor to serve as the Companys investment adviser following the completion of the sale of certain assets related to managing the Company from the Companys prior
investment adviser, BlackRock Kelso Capital Advisors LLC, to the Advisor (the Transaction). The Transaction was completed on March 6, 2015 and, pursuant to the new investment management agreement, dated as of March 6, 2015, the
Companys investment activities are currently managed by the Advisor. Prior to the consummation of the Transaction, the Company had entered into an investment management agreement with BlackRock Kelso Capital Advisors LLC, the
Companys previous adviser, which is referred to as the previous agreement. The Companys current investment management agreement has the same management and incentive fees as the previous agreement until March 6, 2017 and
thereafter will have different management and incentive fees.

Base Management Fee

Under the current investment management agreement, the Advisor, subject to the overall supervision of the Board of Directors, manages the
day-to-day operations and provides the Company with investment advisory services. For providing these services, the Advisor receives, until March 6, 2017, a base management fee at an annual rate of 2.0% of total assets, including any assets
acquired with the proceeds of leverage, payable quarterly in arrears. After March 6, 2017, the Advisor will receive a base management fee at an annual rate of 1.75% of total assets (excluding cash), including any assets acquired with the
proceeds of leverage, payable quarterly in arrears based on total asset valuation at the end of the prior quarter.

The investment
management agreement became effective on March 6, 2015. Unless earlier terminated, the investment management agreement will remain in effect for a period of two years from the date it first becomes effective and will remain in effect from
year-to-year thereafter if approved annually by the Board of Directors or by the affirmative vote of the holders of a majority of outstanding voting securities, including, in either case, approval by a majority of the directors who are not
interested persons.

For the three months ended March 31, 2015 and 2014, the Advisor earned $6,370,630 and $6,160,619, respectively,
in in base management fees under the investment management agreement.

Incentive Management Fee Until March 6, 2017

The current investment management agreement provides that the Advisor or its affiliates may be entitled to an incentive
management fee (the Incentive Fee) as described below under certain circumstances until March 6, 2017. The Incentive Fee is calculated in the same manner as the incentive fee in the previous investment management agreement. The
determination of the Incentive Fee, as described in more detail below, will result in the Advisor or its affiliates receiving no Incentive Fee payments if returns to stockholders do not meet an 8.0% annualized rate of return during the applicable
fee measurement period, and will result in the Advisor or its affiliates receiving less than the full amount of the Incentive Fee percentage until returns to stockholders exceed an approximate 13.3% annualized rate of return during such period.
Annualized rate of return in this context is computed by reference to net asset value and does not take into account changes in the market price of the common stock.

The Advisor will be entitled to receive the Incentive Fee if the performance exceeds a hurdle rate during different measurement
periods: trailing four quarters periods (which apply only to the portion of the Incentive Fee based on income) and annual periods (which apply only to the portion of the Incentive Fee based on capital gains). The trailing four
quarters periods for purposes of determining the income portion of the Incentive Fee payable for the three months ended March 31, 2015 and 2014 was determined by reference to the four quarter periods ended on March 31, 2015 and
2014, respectively. The term annual period means the period beginning on July 1 of each calendar year and ending on June 30 of the next calendar year.

The hurdle rate for each measurement period is 2.0% multiplied by net asset values at the beginning of each calendar quarter during the
measurement period, calculated after giving effect to any distributions that occurred during the measurement period. A portion of the Incentive Fee is based on income and a portion is based on capital gains. Each portion of the Incentive Fee is
described below.



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Quarterly Incentive Fee Based on Income Until March 6, 2017

For each trailing four quarters period, the Company will pay the Advisor an Incentive Fee based on the amount by which
(A) aggregate distributions and amounts distributable out of taxable net income (excluding any capital gain and loss), during the period less the amount, if any, by which net unrealized capital depreciation exceeds net realized capital gains /
losses during the period, is in excess of (B) the hurdle rate for the period. The amount of the excess of (A) over (B) described in this paragraph for each period is referred to as the excess income amount.

It should be noted that net realized capital gains / losses during the period are calculated as the proceeds received upon disposition less the
fair market value as of the beginning of the measurement period. Since this calculation is not cumulative, but rather performed on a trailing four quarters period, fluctuations in fair market values are captured in net unrealized appreciation and
depreciation of prior measurement periods.

The portion of the Incentive Fee based on income for each period will equal 50% of the
periods excess income amount, until the cumulative Incentive Fee payments for the period equal 20% of the periods income amount distributed or distributable to stockholders as described in clause (A) of the preceding paragraph.
Thereafter, the portion of the Incentive Fee based on income for the period will equal 20% of the periods remaining excess income amount.

For the three months ended March 31, 2015 and 2014, the Advisor earned $11,061 and zero respectively, in Incentive Fees based on income
from the Company.

Annual Incentive Fee Based on Capital Gains Until March 6, 2017

The portion of the Incentive Fee based on capital gains is calculated and paid on an annual basis beginning on July 1 of each annual
period and ending on June 30 of the next calendar year. The portion of Incentive Fee based on capital gains is calculated in the same manner as such portion of the incentive fee in the prior investment management agreement. For each annual
period, the Company pays the Advisor an Incentive Fee on capital gains based on the amount by which (A) net realized capital gains, if any, are in excess of gross unrealized capital depreciation, if any, occurring during the period exceeds
(B) the amount, if any, by which the periods hurdle rate exceeds the amount of income used in the determination of the Incentive Fee based on income for the period. The amount of the excess of (A) over (B) described in this
paragraph is referred to as the excess gain amount.

It should be noted that net realized capital gains during the period are calculated as
the proceeds received upon disposition in excess of the lower of each securitys amortized cost or fair market value as of the beginning of the measurement period. Since this calculation is not cumulative, but rather performed on an annual
period commencing each July 1, any unrealized depreciation on a security, if any, will be captured in the gross unrealized depreciation of a prior period.

The portion of the Incentive Fee based on capital gains for each period will equal 50% of the periods excess gain amount, until such
payments equal 20% of the periods capital gain amount distributed or distributable to stockholders. Thereafter, the portion of the Incentive Fee based on capital gains for the period equals an amount such that the portion of the Incentive Fee
payments to the Advisor based on capital gains for the period equals 20% of the periods remaining excess gain amount. The result of this formula is that, if the portion of the Incentive Fee based on income for the period exceeds the
periods hurdle, then the portion of the Incentive Fee based on capital gains will be capped at 20% of the capital gain amount.

In
calculating whether the portion of the Incentive Fee based on capital gains is payable with respect to any period, we account for assets on a security-by-security basis. In addition the Company uses the period-to-period method pursuant
to which the portion of the Incentive Fee based on capital gains for any period is based on realized capital gains for the period reduced by realized capital losses and gross unrealized capital depreciation for the period. Based on current
interpretations of Section 205(b)(3) of the Investment Advisers Act of 1940 by the SEC and its staff, the calculation of unrealized depreciation for each portfolio security over a



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period is based on the fair value of the security at the end of the period compared to the fair value at the beginning of the period. Incentive Fees earned in any of the periods described above
are not subject to modification or repayment based upon performance in a subsequent period.

The Company is required under GAAP to accrue a
hypothetical capital gains Incentive Fee based upon net realized capital gains and unrealized capital appreciation and depreciation on investments held at the end of each period. The accrual of this hypothetical capital gains incentive fee assumes
all unrealized capital appreciation and depreciation is realized in order to reflect a hypothetical capital gains incentive fee that would be payable at each measurement date. If such amount is positive at the end of the period, then record a
capital gains incentive fee equal to 20% of such amount, less the amount of capital gains related incentive fees already accrued in prior periods. If the resulting amount is negative, the accrual for GAAP in a given period may result in an
additional expense. There can be no assurance that such unrealized capital appreciation will be realized in the future. However, it should be noted that a fee so calculated and accrued would not be payable under the Advisers Act or the investment
management agreement. Amounts actually paid will be consistent with the Advisers Act which specifically excludes consideration of unrealized capital appreciation.

The capital gains fees due to the Advisor as calculated under the investment management agreement as described above, for the three months
ended March 31, 2015 and 2014 were zero. In accordance with GAAP, the hypothetical liquidation for the three months ended March 31, 2015 and 2014, resulted in a capital gains incentive fee accrual of $1,366,846 and $3,459,865,
respectively. The cumulative balances at March 31, 2015 and 2014 was $28,901,616 and $29,213,949, respectively.

Incentive
Management Fee After March 6, 2017. After March 6, 2017, the investment management agreement provides that the Advisor or its affiliates may be entitled to an incentive management fee (the Incentive Fee) under certain
circumstances. The Incentive Fee has two parts. The first portion of the Incentive Fee is based on income other than capital gains and is calculated separately for each calendar quarter and will be paid on a quarterly basis. The Company will pay the
Advisor the portion of the Incentive Fee based on income for each period as follows:



| |  |  | (i) No Incentive Fee based on income other than capital gains for any calendar quarter in which the Pre-Incentive Fee Net Investment Income does not exceed 1.75% (7.00% annualized) of net assets attributable to common
stock at the beginning of such quarter.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | (ii) 100% of the Pre-Incentive Fee Net Investment Income in any calendar quarter with respect to that portion of such Pre-Incentive Fee Net Investment Income, if any, for such calendar quarter, that exceeds 1.75% (7.00%
annualized) of net assets attributable to common stock at the beginning of such quarter but is less than 2.1875% (8.75% annualized).
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | (iii) 20% of the Pre-Incentive Fee Net Investment Income, if any, for any calendar quarter, that exceeds 2.1875% (8.75% annualized) of net assets attributable to common stock at the beginning of such quarter.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The payment of any such Incentive Fee based on income otherwise earned by the Advisor will be deferred if, for the most
recent four full calendar quarter period ending on or prior to the date such payment is to be made, the Annualized Rate of Return is less than 7.0% of net assets attributable to common stock at the beginning of such four quarter period as adjusted
for the net proceeds from any common stock issuances and the cost of any common stock repurchases during such four full calendar quarter period, with any deferred Incentive Fees to be carried over for payment in subsequent quarterly calculation
periods to the extent such payment can then be made in accordance with the investment management agreement.

Annual Incentive Fee
Based on Capital Gains After March 6, 2017

The second portion of the Incentive Fee is based on capital gains and is
calculated separately for each Annual Period. The Advisor will be entitled to receive an Incentive Fee based on capital gains for each Annual



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Period in an amount equal to 20% of the amount by which (1) net realized capital gains occurring during the period, if any, exceeds (2) its unrealized capital depreciation, if any,
occurring during the period. In calculating the portion of the Incentive Fee based on capital gains payable for any period, investments are accounted for on a security-by-security basis. In addition, the portion of the Incentive Fee based on capital
gains is determined using the period-to-period method pursuant to which the portion of the Incentive Fee based on capital gains for any period will be based on realized capital gains for the period reduced by realized capital losses for
the period and unrealized capital depreciation for the period.

For purposes of calculating the Incentive Fee, (i) Annual
Period means the period beginning on July 1 of each calendar year, including the calendar year prior to the year in which the investment management agreement became effective, and ending on June 30 of the next calendar year;
(ii) Annualized Rate of Return is computed by reference to the sum of (i) the aggregate distributions to common stockholders for the period in question and (ii) the change in net assets attributable to common stock (before
taking into account any Incentive Fees otherwise payable during such period); (iii) net assets attributable to common stock means total assets less indebtedness and preferred stock; and (iv) Pre-Incentive Fee Net
Investment Income means net investment income (as determined in accordance with United States generally accepted accounting principles) accrued by the Company during the calendar quarter excluding any accruals for or payments in respect of the
Incentive Fee.

Advisor Reimbursements

The investment management agreement provides that the Company will reimburse the Advisor for costs and expenses incurred by the Advisor for
administrative or operating services, office space rental, office equipment and utilities allocable to the Advisor under the investment management agreement and provided to the Company. For the three months ended March 31, 2015 and 2014, the
Company incurred $202,307 and $532,806, respectively, for such investment advisor expenses under the investment management agreement.

From
time to time, the Advisor may pay amounts owed by the Company to third party providers of goods or services. The Company will subsequently reimburse the Advisor for such amounts paid on its behalf. Reimbursements to the Advisor for the three months
ended March 31, 2015 and 2014 were $925,711 and $786,457, respectively.

No person who is an officer, director or employee of the
Advisor and who serves as a director of the Company receives any compensation from the Company for services as a director of the Company. Directors who are not affiliated with the Advisor receive compensation for their services and reimbursement of
expenses incurred to attend meetings.

Administration

The Company also has entered into an administration agreement with BlackRock Financial Management, Inc. (the Administrator) under
which the Administrator provides certain administrative services to the Company. For providing these services, facilities and personnel, the Company reimburses the Administrator for the Companys allocable portion of overhead and other expenses
incurred by the Administrator in performing its obligations under the administration agreement, including rent and the Companys allocable portion of the cost of certain of the Companys officers and their respective staffs. For the three
months ended March 31, 2015 and 2014, the Company incurred $731,697 and $154,421, respectively, for administrative services expenses payable to the Administrator under the administration agreement.

Advisor Stock Transactions

Effective upon completion of the Transaction, BlackRock Advisors, LLC assumed the role as investment adviser to the Company. BlackRock
Advisors, LLC does not own any shares of the Company at March 31, 2015.

At December 31, 2014, previous adviser, BlackRock Kelso
Capital Advisors, owned and had the right to vote approximately 244,000 shares of the Companys common stock, representing less than 1.0% of the total shares outstanding. At December 31, 2014, under compensation arrangements for its
officers and employees the



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previous Advisor owned of record but did not have the right to vote an additional 61,000 shares of the Companys common stock.

At March 31, 2015 and December 31, 2014, other entities affiliated with the Administrator and Advisor beneficially owned
approximately 3,383,000 and 3,383,000 shares, respectively, of the Companys common stock, representing approximately 4.5% and 4.5%, respectively, of the total shares outstanding. An entity affiliated with the Administrator has ownership and
financial interests in the Advisor.

4. Earnings per share

The following information sets forth the computation of basic and diluted net increase in net assets from operations per share (earnings per
share) for the three months ended March 31, 2015 and 2014.



|                                                                         |  |                                 |            |  |                                 |   |            | 
|------------------------------------------------------------------------ |  | ------------------------------- | ---------- |  | ------------------------------- | - | ---------- | 
|                                                                         |  | Three monthsendedMarch 31, 2015 |            |  | Three monthsendedMarch 31, 2014 |  
|Earnings per share  basic:                                              |  |                                 |            |  |                                 |   |            | 
|Net increase in net assets resulting from operations                     |  | $                               | 22,655,619 |  |                                 | $ | 22,916,519 | 
|Weighted average shares outstanding  basic                              |  |                                 | 74,664,007 |  |                                 |   | 74,517,547 | 
|Earnings per share  basic:                                              |  | $                               | 0.30       |  |                                 | $ | 0.31       | 
|Earnings per share  diluted:                                            |  |                                 |            |  |                                 |   |            | 
|Net increase in net assets resulting from operations, before adjustments |  | $                               | 22,655,619 |  |                                 | $ | 22,916,519 | 
|Adjustments for interest on unsecured convertible senior notes           |  |                                 | 1,641,955  |  |                                 |   | 1,641,956  | 
|                                                                         |  |                                 |            |  |                                 |   |            | 
|Net increase in net assets resulting from operations, as adjusted        |  | $                               | 24,297,574 |  |                                 | $ | 24,558,475 | 
|Weighted average shares outstanding  diluted                            |  |                                 | 84,560,734 |  |                                 |   | 84,414,275 | 
|Earnings per share  diluted:                                            |  | $                               | 0.29       |  |                                 | $ | 0.29       | 

5. Investments

Purchases of investments, including PIK, for the three months ended March 31, 2015 and 2014 totaled $46,299,992 and $62,955,147,
respectively. Sales, repayments and other exits of investments for the three months ended March 31, 2015 and 2014 totaled $74,874,153 and $188,032,090, respectively.

At March 31, 2015, investments consisted of the following:



|                                                        |  |      |               |  |            |   |               | 
|------------------------------------------------------- |  | ---- | ------------- |  | ---------- | - | ------------- | 
|                                                        |  | Cost |               |  | Fair Value |  
|                                                        |  |      |               | 
|Senior secured notes                                    |  | $    | 105,441,550   |  |            | $ | 102,530,000   | 
|Unsecured debt                                          |  |      | 172,015,218   |  |            |   | 170,217,049   | 
|Subordinated debt                                       |  |      | 29,791,550    |  |            |   | 28,548,800    | 
|Senior secured loans:                                   |  |      |               |  |            |   |               | 
|First lien                                              |  |      | 326,404,134   |  |            |   | 326,246,120   | 
|Second/other priority lien                              |  |      | 357,692,522   |  |            |   | 352,000,865   | 
|                                                        |  |      |               | 
|Total senior secured loans                              |  |      | 684,096,656   |  |            |   | 678,246,985   | 
|                                                        |  |      |               | 
|Preferred stock                                         |  |      | 39,019,713    |  |            |   | 44,457,232    | 
|Common stock                                            |  |      | 43,926,605    |  |            |   | 97,364,017    | 
|Limited partnership/limited liability company interests |  |      | 34,351,119    |  |            |   | 92,892,847    | 
|Equity warrants/options                                 |  |      | 5,575,199     |  |            |   | 21,379,386    | 
|                                                        |  |      |               | 
|Total investments                                       |  | $    | 1,114,217,610 |  |            | $ | 1,235,636,316 | 
|                                                        |  |      |               | 



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At December 31, 2014, investments consisted of the following:



|                                                        |  |      |               |  |            |   |               | 
|------------------------------------------------------- |  | ---- | ------------- |  | ---------- | - | ------------- | 
|                                                        |  | Cost |               |  | Fair Value |  
|                                                        |  |      |               | 
|Senior secured notes                                    |  | $    | 105,139,824   |  |            | $ | 101,459,500   | 
|Unsecured debt                                          |  |      | 178,853,603   |  |            |   | 174,559,213   | 
|Subordinated debt                                       |  |      | 52,166,802    |  |            |   | 50,524,000    | 
|Senior secured loans:                                   |  |      |               |  |            |   |               | 
|First lien                                              |  |      | 336,770,357   |  |            |   | 338,268,867   | 
|Second/other priority lien                              |  |      | 331,854,788   |  |            |   | 327,019,125   | 
|                                                        |  |      |               | 
|Total senior secured loans                              |  |      | 668,625,145   |  |            |   | 665,287,992   | 
|                                                        |  |      |               | 
|Preferred stock                                         |  |      | 35,283,803    |  |            |   | 40,484,870    | 
|Common stock                                            |  |      | 49,592,388    |  |            |   | 106,979,016   | 
|Limited partnership/limited liability company interests |  |      | 39,064,194    |  |            |   | 98,591,728    | 
|Equity warrants/options                                 |  |      | 5,575,199     |  |            |   | 19,830,419    | 
|                                                        |  |      |               | 
|Total investments                                       |  | $    | 1,134,300,958 |  |            | $ | 1,257,716,738 | 
|                                                        |  |      |               | 

Industry Composition

The industry composition of the portfolio at fair value at March 31, 2015 and December 31, 2014 was as follows:



|                               |  |                |       |   |                   |  |       |  
|------------------------------ |  | -------------- | ----- | - | ----------------- |  | ----- | -
|Industry                       |  | March 31, 2015 |       |   | December 31, 2014 | 
|Consumer Products              |  |                | 14.3  | % |                   |  | 14.1  | %
|Financial Services             |  |                | 13.2  |   |                   |  | 14.2  |  
|Energy                         |  |                | 10.9  |   |                   |  | 10.9  |  
|Healthcare                     |  |                | 10.0  |   |                   |  | 10.3  |  
|Chemicals                      |  |                | 10.0  |   |                   |  | 9.8   |  
|Personal and Other Services    |  |                | 8.0   |   |                   |  | 8.0   |  
|Building and Real Estate       |  |                | 7.9   |   |                   |  | 7.4   |  
|Printing, Publishing and Media |  |                | 5.9   |   |                   |  | 5.8   |  
|Manufacturing                  |  |                | 5.8   |   |                   |  | 6.8   |  
|Business Services              |  |                | 4.7   |   |                   |  | 4.6   |  
|Defense                        |  |                | 3.6   |   |                   |  | 3.6   |  
|Distribution                   |  |                | 2.8   |   |                   |  | 0.8   |  
|Retail                         |  |                | 1.9   |   |                   |  | 2.0   |  
|Beverage, Food and Tobacco     |  |                | 0.7   |   |                   |  | 0.7   |  
|Electronics                    |  |                | 0.3   |   |                   |  | 0.3   |  
|Containers and Packaging       |  |                |      |   |                   |  | 0.7   |  
|                               |  |                |       |   |                   |  |       |  
|Total                          |  |                | 100.0 | % |                   |  | 100.0 | %
|                               |  |                |       |   |                   |  |       |  

The geographic composition of the portfolio at fair value at March 31, 2015 was United States 97.0%,
Canada 1.9% and the Cayman Islands 1.1%, and at December 31, 2014 was United States 96.8%, Canada 2.0% and the Cayman Islands 1.2%. The geographic composition is determined by several factors including the location of the corporate headquarters
of the portfolio company.



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Market and Credit Risk

In the normal course of business, the Company invests in securities and enters into transactions where risks exist due to fluctuations in the
market (market risk) or failure of the issuer of a security to meet all its obligations (issuer credit risk). The value of securities held by the Company may decline in response to certain events, including those directly involving the issuers whose
securities are owned by the Company; conditions affecting the general economy; overall market changes; local, regional or global political, social or economic instability; and currency and interest rate and price fluctuations. Similar to issuer
credit risk, the Company may be exposed to counterparty credit risk, or the risk that an entity with which the Company has unsettled or open transactions may fail to or be unable to perform on its commitments. The Company manages counterparty risk
by entering into transactions only with counterparties that they believe have the financial resources to honor their obligations and by monitoring the financial stability of those counterparties. Financial assets, which potentially expose the
Company to market, issuer and counterparty credit risks, consist principally of investments in portfolio companies. The extent of the Companys exposure to market, issuer and counterparty credit risks with respect to these financial assets is
generally approximated by their value recorded in the consolidated statements of assets and liabilities. The Company is also exposed to credit risk related to maintaining all of its cash at a major financial institution.

The Company has investments in lower rated and comparable quality unrated senior and junior secured, unsecured and subordinated debt securities
and loans, which are subject to a greater degree of credit risk than more highly rated investments. The risk of loss due to default by the issuer is significantly greater for holders of such securities and loans, particularly in cases where the
investment is unsecured or subordinated to other creditors of the issuer.

6. Derivatives

Foreign Currency

The Company may enter into forward foreign currency contracts from time to time to facilitate settlement of purchases and sales of investments
denominated in foreign currencies or to help mitigate the impact that an adverse change in foreign exchange rates would have on the value of the Companys investments denominated in foreign currencies. A forward foreign currency contract is a
commitment to purchase or sell a foreign currency at a future date (usually the security transaction settlement date) at a negotiated forward rate. These contracts are marked-to-market by recognizing the difference between the contract exchange rate
and the current market rate as unrealized appreciation or depreciation. Realized gains or losses are recognized when contracts are settled. The Companys forward foreign currency contracts generally have terms of approximately three months. The
volume of open contracts at the end of each reporting period is reflective of the typical volume of transactions during each calendar quarter. Risks may arise as a result of the potential inability of the counterparties to meet the terms of their
contracts. The Company attempts to limit this risk by dealing with only creditworthy counterparties. There were no open forward foreign currency contracts at March 31, 2015 or December 31, 2014.

Warrants and Options

The Company holds warrants and options in certain portfolio companies in an effort to achieve additional investment return. In purchasing
warrants and options, the Company bears the risk of an unfavorable change in the value of the underlying equity interest. The aggregate fair value of warrants and options as of March 31, 2015 and December 31, 2014 represents 2.7% and 2.5%,
respectively, of the Companys net assets.

The Company may enter into other derivative instruments and incur other exposures with
other counterparties in the future. The derivative instruments held as of March 31, 2015 and December 31, 2014 reflect the volume of derivative activity throughout the periods presented.



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7. Debt

In accordance with the 1940 Act, with certain limited exceptions, the Company is only allowed to borrow amounts such that
its asset coverage, calculated pursuant to the 1940 Act, is at least 200% after such borrowing. As of March 31, 2015, the Companys asset coverage was 266%.

On March 27, 2014, the Company entered into an Amended and Restated Senior Secured Revolving Credit Facility (the Credit
Facility) which has an initial aggregate principal amount of up to $405,000,000. The Credit Facility has a stated maturity date of March 27, 2019. The interest rate applicable to borrowings thereunder is generally LIBOR plus an applicable
margin of 2.25%. The Credit Facilitys commitment may increase in size, under certain circumstances, up to a total of $750,000,000.

On March 27, 2014, the Company entered into an Amended and Restated Senior Secured Term Loan Credit Agreement (the Term Loan)
which has a principal amount of $15,000,000. The Term Loan has a stated maturity date of March 27, 2019. The interest rate applicable to borrowings thereunder is generally LIBOR plus an applicable margin of 3.25%.

On February 19, 2013, the Company closed a private offering of $100,000,000 in aggregate principal amount of 5.50% unsecured convertible
senior notes due 2018 (the Convertible Notes). The initial purchasers of the Convertible Notes fully exercised their overallotment option and purchased an additional $15,000,000 in aggregate principal amount of the Convertible Notes. The
closing of the overallotment option took place on March 4, 2013. With the exercise of the overallotment option, a total of $115,000,000 in aggregate principal amount of the Convertible Notes was sold. Net proceeds to the Company from the
offering, including the exercise of the overallotment option, were approximately $111,300,000. The Convertible Notes were only offered to qualified institutional buyers as defined in the Securities Act of 1933, as amended (the Securities
Act) pursuant to Rule 144A under the Securities Act.

The Convertible Notes are unsecured and bear interest at a rate of
5.50% per year, payable semi-annually in arrears. In certain circumstances and during certain periods, the Convertible Notes are convertible into cash, shares of BlackRock Capital Investment Corporationss common stock or a combination of
cash and shares of the Companys common stock, at the Companys election, at an initial conversion rate of 86.0585 shares of common stock per $1,000 principal amount of the Convertible Notes, which is equivalent to an initial conversion
price of approximately $11.62 per share of the Companys common stock, subject to defined anti-dilution adjustments. The Company does not have the right to redeem the Convertible Notes prior to maturity. The Convertible Notes mature on
February 15, 2018, unless repurchased or converted in accordance with their terms prior to such date.

On January 18, 2011, the
Company closed a private placement issuance of $158,000,000 in aggregate principal amount of five-year, senior secured notes with a fixed interest rate of 6.50% and a maturity date of January 18, 2016 and $17,000,000 million in aggregate
principal amount of seven-year, senior secured notes with a fixed interest rate of 6.60% and a maturity date of January 18, 2018 (collectively, the Senior Secured Notes).

The Senior Secured Notes were sold to certain institutional accredited investors pursuant to an exemption from registration under the
Securities Act of 1933, as amended. Interest on the Senior Secured Notes is due semi-annually on January 18 and July 18, commencing on July 18, 2011.



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The Companys outstanding debt as of March 31, 2015 and December 31, 2014 was as
follows:



|                     |                                           |       |             |                            |  |   |                |  |  |                                           |             |     |                            |   |             |                |  |   |             |  |  |   |             |    
|-------------------- | ----------------------------------------- | ----- | ----------- | -------------------------- |  | - | -------------- |  |  | ----------------------------------------- | ----------- | --- | -------------------------- | - | ----------- | -------------- |  | - | ----------- |  |  | - | ----------- | ---
|                     |                                           | As of |            
|                     | March 31, 2015                            |       |             | December 31, 2014          | 
|                     | TotalAggregatePrincipalAmountAvailable(1) |       |             | PrincipalAmountOutstanding |  |   | Carrying Value |  |  | TotalAggregatePrincipalAmountAvailable(1) |             |     | PrincipalAmountOutstanding |   |             | Carrying Value | 
|Credit Facility      |                                           | $     | 405,000,000 | (2)                        |  | $ | 168,000,000    |  |  | $                                         | 168,000,000 |     |                            | $ | 405,000,000 | (2)            |  | $ | 144,000,000 |  |  | $ | 144,000,000 |    
|Senior Secured Notes |                                           |       | 175,000,000 |                            |  |   | 175,000,000    |  |  |                                           | 175,000,000 |     |                            |   | 175,000,000 |                |  |   | 175,000,000 |  |  |   | 175,000,000 |    
|Convertible Notes    |                                           |       | 115,000,000 |                            |  |   | 115,000,000    |  |  |                                           | 114,288,395 | (3) |                            |   | 115,000,000 |                |  |   | 115,000,000 |  |  |   | 114,227,689 | (4)
|Term Loan            |                                           |       | 15,000,000  |                            |  |   | 15,000,000     |  |  |                                           | 15,000,000  |     |                            |   | 15,000,000  |                |  |   | 15,000,000  |  |  |   | 15,000,000  |    
|                     |                                           |       |             |                            |  |   |                |  |  |                                           |             |     |                            |   |             |                |  |   |             |  |  |   |             |    
|                     |                                           | $     | 710,000,000 |                            |  | $ | 473,000,000    |  |  | $                                         | 472,288,395 |     |                            | $ | 710,000,000 |                |  | $ | 449,000,000 |  |  | $ | 448,227,689 |    
|                     |                                           |       |             |                            |  |   |                |  |  |                                           |             |     |                            |   |             |                |  |   |             |  |  |   |             |    



|(1) | Subject to borrowing base and leverage restrictions.
|--- | ----------------------------------------------------

|(2) | Provides for a feature that allows the Company, under certain circumstances, up to a total of $750,000,000.
|--- | -----------------------------------------------------------------------------------------------------------

|(3) | Represents the aggregate principal amount outstanding of the Convertible Notes less the unaccreted discount initially recorded upon issuance of the Convertible Notes. The total unaccreted discount for the 2018
Convertible Notes, was $711,605 as of March 31, 2015.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Represents the aggregate principal amount outstanding of the Convertible Notes less the unaccreted discount initially recorded upon issuance of the Convertible Notes. The total unaccreted discount for the 2018
Convertible Notes was $772,311 as of December 31, 2014.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

At March 31, 2015, the Company had $168,000,000 drawn on
the Credit Facility versus $144,000,000 at December 31, 2014. Subject to compliance with applicable covenants and borrowing base limitations, the remaining amount available under the Credit Facility was $231,750,000 at March 31, 2015,
incorporating the standby letter of credit as described in Note 9 and $261,000,000 at December 31, 2014.

The Companys average
outstanding debt balance during the three months ended March 31, 2015 and 2014 was $460,536,157 and $482,367,741, respectively. The maximum amounts borrowed during the three months ended March 31, 2015 and 2014 were $478,288,395 and
$517,042,201, respectively.

The weighted average annual interest cost for the three months ended March 31, 2015 and 2014 was 4.95%
and 4.91%, respectively, exclusive of commitment fees and of other prepaid expenses related to establishing the Credit Facility, the Senior Secured Notes, the Convertible Notes and the Term Loan. With respect to any unused portion of the commitments
under the Credit Facility, the Company incurs an annual commitment fee of 0.375%. Commitment fees incurred for the three months ended March 31, 2015 and 2014 were $242,157 and $162,321, respectively.

At March 31, 2015, the Company was in compliance with all covenants required under the Credit Facility, the Senior Secured Notes and the
Term Loan.

8. Capital stock

In
2008, the Companys Board of Directors approved a share repurchase plan under which the Company may repurchase up to 2.5 percent of its outstanding shares of common stock from time to time in open market or privately negotiated transactions. In
2009, the Board of Directors approved an extension and increase to the plan which authorized the Company to repurchase up to an additional 2.5 percent of its outstanding shares of common stock.

In April 2014, the repurchase plan was further extended through the earlier of June 30, 2015 or until the approved number of shares has
been repurchased. During the three months ended March 31, 2015 and 2014 the Company did not purchase common stock on the open market. Since inception of the repurchase plan through



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March 31, 2015, the Company has purchased 1,758,615 shares of its common stock on the open market for $12,283,985, including brokerage commissions. At March 31, 2015, the total number
of remaining shares authorized for repurchase was 998,035. The Company currently holds the shares it repurchased in treasury.

9. Guarantees and
commitments

In the normal course of business, the Company may enter into guarantees on behalf of portfolio companies. Under these
arrangements, the Company would be required to make payments to third parties if the portfolio companies were to default on their related payment obligations. On March 24, 2015 the Company entered into a standby letter of credit on behalf of
Red Apple Stores Inc in the amount of $5,250,000. No amounts were drawn at March 31, 2015. There were no such guarantees outstanding at March 31, 2014.

In the normal course of business, the Company enters into contractual agreements that provide general indemnifications against losses, costs,
claims and liabilities arising from the performance of individual obligations under such agreements. The Company has had no prior claims or payments pursuant to such agreements. The Companys individual maximum exposure under these arrangements
is unknown, as this would involve future claims that may be made against the Company that have not yet occurred. However, based on managements experience, the Company expects the risk of loss to be remote.

From time to time, the Company may be a party to certain legal proceedings incidental to the normal course of its business, including the
enforcement of the Companys rights under contracts with its portfolio companies. While the Company cannot predict the outcome of these legal proceedings with certainty, it does not expect that these proceedings will have a material effect on
its consolidated financial statements.

10. Fair value of financial instruments

Fair Value Measurements and Disclosure

ASC 820-10 defines fair value, establishes a framework for measuring fair value and requires disclosures about fair value measurements. ASC
820-10 defines fair value as the price that the Company would receive upon selling an investment or pay to transfer a liability in an orderly transaction to a market participant in the principal or most advantageous market for the investment. ASC
820-10 emphasizes that valuation techniques maximize the use of observable market inputs and minimize the use of unobservable inputs. Inputs refer broadly to the assumptions that market participants would use in pricing an asset or liability,
including assumptions about risk. Inputs may be observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use in pricing an asset or liability developed based on market data obtained from sources
independent of the Company. Unobservable inputs are inputs that reflect the Companys assumptions about the assumptions market participants would use in pricing an asset or liability developed based on the best information available in the
circumstances.

Level 1  Valuations based on unadjusted quoted prices in active markets for identical assets or
liabilities that the Company has the ability to access.

Level 2  Valuations based on unadjusted quoted prices in
markets that are not active or for which all significant inputs are observable, either directly or indirectly.

Level 3
 Valuations based on inputs that are unobservable and significant to the overall fair value measurement. The inputs into the determination of fair value may require significant management judgment or estimation.

Transfers between levels, if any, represent the value as of the beginning of the period of any investment where a change in the pricing level
occurred from the beginning to the end of the period.

The Companys valuation policy and fair value disclosures are consistent with
ASC 820-10. The Company evaluates the source of inputs, including any markets in which its investments are trading, in determining fair value and categorizes each investment within the fair value hierarchy pursuant to ASC 820-10.



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Under the 1940 Act, the Company is required to separately identify non-controlled investments
where it owns 5% or more of a portfolio companys outstanding voting securities as investments in affiliated companies. In addition, under the 1940 Act, the Company is required to separately identify investments where it owns more
than 25% of a portfolio companys outstanding voting securities as investments in controlled companies. Detailed information with respect to the Companys non-controlled non-affiliated, non-controlled affiliated and controlled
investments is contained in the accompanying consolidated schedules of investments and other consolidated financial statements. The information in the tables below is presented on an aggregate portfolio basis, without segregating the non-controlled
non-affiliated, non-controlled affiliated and controlled investment categories.

The carrying values of the Companys financial
instruments approximate fair value. The carrying values of receivables, other assets, accounts payable and accrued expenses approximate fair value due to their short maturities. The fair value of the Companys Credit Facility, Senior Secured
Notes, Convertible Notes and Term Loan is derived by taking the average of the high and low quotes as obtained from a broker. The fair value of the Credit Facility Senior Secured Notes, Convertible Notes and Term Loan would be classified as Level 2
with respect to the fair value hierarchy.

The carrying and fair values of the Companys outstanding debt as of March 31, 2015
and December 31, 2014 were as follows:



|                     |  |                |             |  |                   |   |             |                |  |   |             |  |  |   |             | 
|-------------------- |  | -------------- | ----------- |  | ----------------- | - | ----------- | -------------- |  | - | ----------- |  |  | - | ----------- | 
|                     |  | March 31, 2015 |             |  | December 31, 2014 |  
|                     |  | Carrying Value |             |  | Fair Value        |   |             | Carrying Value |  |   | Fair Value  | 
|Credit Facility      |  | $              | 168,000,000 |  |                   | $ | 166,320,000 |                |  | $ | 144,000,000 |  |  | $ | 142,560,000 | 
|Senior Secured Notes |  |                | 175,000,000 |  |                   |   | 182,558,030 |                |  |   | 175,000,000 |  |  |   | 183,890,750 | 
|Convertible Notes    |  |                | 114,288,395 |  |                   |   | 118,574,210 |                |  |   | 114,227,689 |  |  |   | 115,655,535 | 
|Term Loan            |  |                | 15,000,000  |  |                   |   | 14,925,000  |                |  |   | 15,000,000  |  |  |   | 14,925,000  | 
|                     |  |                |             |  |                   |   |             |                |  |   |             |  |  |   |             | 
|Total                |  | $              | 472,288,395 |  |                   | $ | 482,377,240 |                |  | $ | 448,227,689 |  |  | $ | 457,031,285 | 
|                     |  |                |             |  |                   |   |             |                |  |   |             |  |  |   |             | 

The following tables summarize the fair values of the Companys investments, forward foreign currency
contracts and cash and cash equivalents based on the inputs used at March 31, 2015 and December 31, 2014 in determining such fair values:



|                                                        |  |                            |               |  |                                     |   |            |                                             |  |   |                                         |  |  |   |               | 
|------------------------------------------------------- |  | -------------------------- | ------------- |  | ----------------------------------- | - | ---------- | ------------------------------------------- |  | - | --------------------------------------- |  |  | - | ------------- | 
|                                                        |  |                            |               |  | Fair Value Inputs at March 31, 2015 |  
|                                                        |  | Fair Valueat March 31,2015 |               |  | PriceQuotations(Level 1)            |   |            | Significant OtherObservable Inputs(Level 2) |  |   | SignificantUnobservable Inputs(Level 3) | 
|Senior secured notes                                    |  | $                          | 102,530,000   |  |                                     | $ |           |                                             |  | $ |                                        |  |  | $ | 102,530,000   | 
|Unsecured debt                                          |  |                            | 170,217,049   |  |                                     |   |           |                                             |  |   |                                        |  |  |   | 170,217,049   | 
|Subordinated debt                                       |  |                            | 28,548,800    |  |                                     |   |           |                                             |  |   |                                        |  |  |   | 28,548,800    | 
|Senior secured loans                                    |  |                            | 678,246,985   |  |                                     |   |           |                                             |  |   |                                        |  |  |   | 678,246,985   | 
|Preferred stock                                         |  |                            | 44,457,232    |  |                                     |   |           |                                             |  |   |                                        |  |  |   | 44,457,232    | 
|Common stock                                            |  |                            | 97,364,017    |  |                                     |   |           |                                             |  |   |                                        |  |  |   | 97,364,017    | 
|Limited partnership/limited liability company interests |  |                            | 92,892,847    |  |                                     |   |           |                                             |  |   |                                        |  |  |   | 92,892,847    | 
|Equity warrants/options                                 |  |                            | 21,379,386    |  |                                     |   |           |                                             |  |   |                                        |  |  |   | 21,379,386    | 
|                                                        |  |                            |               |  |                                     |   |            |                                             |  |   |                                         |  |  |   |               | 
|Total investments                                       |  |                            | 1,235,636,316 |  |                                     |   |           |                                             |  |   |                                        |  |  |   | 1,235,636,316 | 
|Cash and cash equivalents                               |  |                            | 45,335,615    |  |                                     |   | 45,335,615 |                                             |  |   |                                        |  |  |   |              | 
|                                                        |  |                            |               |  |                                     |   |            |                                             |  |   |                                         |  |  |   |               | 
|Total                                                   |  | $                          | 1,280,971,931 |  |                                     | $ | 45,335,615 |                                             |  | $ |                                        |  |  | $ | 1,235,636,316 | 
|                                                        |  |                            |               |  |                                     |   |            |                                             |  |   |                                         |  |  |   |               | 



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|                                                        |  |                               |                                        |  |                          |   |            |                                             |  |   |                                         |  |  |   |               | 
|------------------------------------------------------- |  | ----------------------------- | -------------------------------------- |  | ------------------------ | - | ---------- | ------------------------------------------- |  | - | --------------------------------------- |  |  | - | ------------- | 
|                                                        |  |                               | Fair Value Inputs at December 31, 2014 | 
|                                                        |  | Fair Valueat December 31,2014 |                                        |  | PriceQuotations(Level 1) |   |            | Significant OtherObservable Inputs(Level 2) |  |   | SignificantUnobservable Inputs(Level 3) | 
|Senior secured notes                                    |  | $                             | 101,459,500                            |  |                          | $ |           |                                             |  | $ |                                        |  |  | $ | 101,459,500   | 
|Unsecured debt                                          |  |                               | 174,559,213                            |  |                          |   |           |                                             |  |   |                                        |  |  |   | 174,559,213   | 
|Subordinated debt                                       |  |                               | 50,524,000                             |  |                          |   |           |                                             |  |   |                                        |  |  |   | 50,524,000    | 
|Senior secured loans                                    |  |                               | 665,287,992                            |  |                          |   |           |                                             |  |   |                                        |  |  |   | 665,287,992   | 
|Preferred stock                                         |  |                               | 40,484,870                             |  |                          |   |           |                                             |  |   |                                        |  |  |   | 40,484,870    | 
|Common stock                                            |  |                               | 106,979,016                            |  |                          |   |           |                                             |  |   |                                        |  |  |   | 106,979,016   | 
|Limited partnership/limited liability company interests |  |                               | 98,591,728                             |  |                          |   |           |                                             |  |   |                                        |  |  |   | 98,591,728    | 
|Equity warrants/options                                 |  |                               | 19,830,419                             |  |                          |   |           |                                             |  |   |                                        |  |  |   | 19,830,419    | 
|                                                        |  |                               |                                        |  |                          |   |            |                                             |  |   |                                         |  |  |   |               | 
|Total investments                                       |  |                               | 1,257,716,738                          |  |                          |   |           |                                             |  |   |                                        |  |  |   | 1,257,716,738 | 
|Cash and cash equivalents                               |  |                               | 10,326,174                             |  |                          |   | 10,326,174 |                                             |  |   |                                        |  |  |   |              | 
|                                                        |  |                               |                                        |  |                          |   |            |                                             |  |   |                                         |  |  |   |               | 
|Total                                                   |  | $                             | 1,268,042,912                          |  |                          | $ | 10,326,174 |                                             |  | $ |                                        |  |  | $ | 1,257,716,738 | 
|                                                        |  |                               |                                        |  |                          |   |            |                                             |  |   |                                         |  |  |   |               | 

The valuation techniques used at March 31, 2015 and December 31, 2014 in determining the fair values
of the Companys investments for which significant unobservable inputs were used were the market approach, income approach or both using third party valuation firms or broker quotes for identical or similar assets. The total fair market value
using the market or income approach or using third party valuation firms was $1,229,057,923 and $1,251,086,872 as of March 31, 2015 and December 31, 2014, respectively. The remaining balance was determined using broker quotes for identical
or similar assets.

The following is a reconciliation for the three months ended March 31, 2015 of investments for which Level 3
inputs were used in determining fair value:



|                                  |  |                               |               |  |                                       |   |         |                        |  |   |                                                    |   |  |           |            |   |                    |   |            |                                     |  |   |                            |   |  |   |   |  |  |   |               | 
|--------------------------------- |  | ----------------------------- | ------------- |  | ------------------------------------- | - | ------- | ---------------------- |  | - | -------------------------------------------------- | - |  | --------- | ---------- | - | ------------------ | - | ---------- | ----------------------------------- |  | - | -------------------------- | - |  | - | - |  |  | - | ------------- | 
|                                  |  | Fair Value atDecember 31,2014 |               |  | Amortizationof Premium/Discount - Net |   |         | NetRealizedGain (Loss) |  |   | Net Change inUnrealizedAppreciation orDepreciation |   |  | Purchases |            |   | Sales orRepayments |   |            | Net Transfersin and/orout ofLevel 3 |  |   | Fair Value atMarch 31,2015 |  
|Senior secured notes              |  | $                             | 101,459,500   |  |                                       | $ | 301,726 |                        |  | $ |                                                   |   |  | $         | 768,774    |   |                    | $ |           |                                     |  | $ |                           |   |  | $ |  |  |  | $ | 102,530,000   | 
|Unsecured debt                    |  |                               | 174,559,213   |  |                                       |   |        |                        |  |   | (6,377,901                                         | ) |  |           | 2,496,221  |   |                    |   | 10,332,595 |                                     |  |   | (10,793,079                | ) |  |   |  |  |  |   | 170,217,049   | 
|Subordinated debt                 |  |                               | 50,524,000    |  |                                       |   | 24,748  |                        |  |   |                                                   |   |  |           | 400,052    |   |                    |   |           |                                     |  |   | (22,400,000                | ) |  |   |  |  |  |   | 28,548,800    | 
|Senior secured loans              |  |                               | 665,287,992   |  |                                       |   | 483,264 |                        |  |   | 237,345                                            |   |  |           | (2,512,518 | ) |                    |   | 31,944,562 |                                     |  |   | (17,193,660                | ) |  |   |  |  |  |   | 678,246,985   | 
|Preferred stock                   |  |                               | 40,484,870    |  |                                       |   |        |                        |  |   |                                                   |   |  |           | 236,452    |   |                    |   | 3,735,910  |                                     |  |   |                           |   |  |   |  |  |  |   | 44,457,232    | 
|Common stock                      |  |                               | 106,979,016   |  |                                       |   |        |                        |  |   | 9,215,196                                          |   |  |           | (3,949,216 | ) |                    |   |           |                                     |  |   | (14,880,979                | ) |  |   |  |  |  |   | 97,364,017    | 
|Limited partnership/ LLC Interest |  |                               | 98,591,728    |  |                                       |   |        |                        |  |   | 5,272,219                                          |   |  |           | (985,806   | ) |                    |   | 286,925    |                                     |  |   | (10,272,219                | ) |  |   |  |  |  |   | 92,892,847    | 
|Equity warrants/options           |  |                               | 19,830,419    |  |                                       |   |        |                        |  |   |                                                   |   |  |           | 1,548,967  |   |                    |   |           |                                     |  |   |                           |   |  |   |  |  |  |   | 21,379,386    | 
|                                  |  |                               |               |  |                                       |   |         |                        |  |   |                                                    |   |  |           |            |   |                    |   |            |                                     |  |   |                            |   |  |   |   |  |  |   |               | 
|Total investments                 |  | $                             | 1,257,716,738 |  |                                       | $ | 809,738 |                        |  | $ | 8,346,859                                          |   |  | $         | (1,997,074 | ) |                    | $ | 46,299,992 |                                     |  | $ | (75,539,937                | ) |  | $ |  |  |  | $ | 1,235,636,316 | 
|                                  |  |                               |               |  |                                       |   |         |                        |  |   |                                                    |   |  |           |            |   |                    |   |            |                                     |  |   |                            |   |  |   |   |  |  |   |               | 



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The following is a reconciliation for the three months ended March 31, 2014 of investments
for which Level 3 inputs were used in determining fair value:



|                                  |  |                               |               |  |                                       |   |         |                        |  |   |                                                    |   |  |           |             |   |                    |   |            |                                     |  |   |                            |   |  |   |   |  |  |   |               | 
|--------------------------------- |  | ----------------------------- | ------------- |  | ------------------------------------- | - | ------- | ---------------------- |  | - | -------------------------------------------------- | - |  | --------- | ----------- | - | ------------------ | - | ---------- | ----------------------------------- |  | - | -------------------------- | - |  | - | - |  |  | - | ------------- | 
|                                  |  | Fair Value atDecember 31,2013 |               |  | Amortizationof Premium/Discount - Net |   |         | NetRealizedGain (Loss) |  |   | Net Change inUnrealizedAppreciation orDepreciation |   |  | Purchases |             |   | Sales orRepayments |   |            | Net Transfersin and/orout ofLevel 3 |  |   | Fair Value atMarch 31,2014 |  
|Senior secured notes              |  | $                             | 226,685,176   |  |                                       | $ | 402,286 |                        |  | $ | 354,905                                            |   |  | $         | (1,132,104  | ) |                    | $ |           |                                     |  | $ | (57,413,638                | ) |  | $ |  |  |  | $ | 168,896,625   | 
|Unsecured debt                    |  |                               | 118,531,084   |  |                                       |   |        |                        |  |   |                                                   |   |  |           |            |   |                    |   | 665,331    |                                     |  |   |                           |   |  |   |  |  |  |   | 119,196,415   | 
|Subordinated debt                 |  |                               | 78,395,314    |  |                                       |   |        |                        |  |   |                                                   |   |  |           | (408,000    | ) |                    |   |           |                                     |  |   |                           |   |  |   |  |  |  |   | 77,987,314    | 
|Senior secured loans              |  |                               | 527,203,698   |  |                                       |   | 469,920 |                        |  |   | (3,531,997                                         | ) |  |           | 4,763,008   |   |                    |   | 48,492,500 |                                     |  |   | (74,021,421                | ) |  |   |  |  |  |   | 503,375,708   | 
|Preferred stock                   |  |                               | 24,872,259    |  |                                       |   |        |                        |  |   |                                                   |   |  |           | (338,054    | ) |                    |   | 5,507,412  |                                     |  |   |                           |   |  |   |  |  |  |   | 30,041,617    | 
|Common stock                      |  |                               | 143,355,344   |  |                                       |   |        |                        |  |   | 23,923,415                                         |   |  |           | (5,006,518  | ) |                    |   | 8,253,481  |                                     |  |   | (41,446,732                | ) |  |   |  |  |  |   | 129,078,990   | 
|Limited partnership/ LLC Interest |  |                               | 68,364,016    |  |                                       |   |        |                        |  |   | (1,750                                             | ) |  |           | 1,996,365   |   |                    |   | 36,423     |                                     |  |   | (758,069                   | ) |  |   |  |  |  |   | 69,636,985    | 
|Equity warrants/options           |  |                               | 30,565,573    |  |                                       |   |        |                        |  |   | 13,082,672                                         |   |  |           | (21,062,916 | ) |                    |   |           |                                     |  |   | (14,697,932                | ) |  |   |  |  |  |   | 7,887,397     | 
|                                  |  |                               |               |  |                                       |   |         |                        |  |   |                                                    |   |  |           |             |   |                    |   |            |                                     |  |   |                            |   |  |   |   |  |  |   |               | 
|Total investments                 |  | $                             | 1,217,972,464 |  |                                       | $ | 872,206 |                        |  | $ | 33,827,245                                         |   |  | $         | (21,188,219 | ) |                    | $ | 62,955,147 |                                     |  | $ | (188,337,792               | ) |  | $ |  |  |  | $ | 1,106,101,051 | 
|                                  |  |                               |               |  |                                       |   |         |                        |  |   |                                                    |   |  |           |             |   |                    |   |            |                                     |  |   |                            |   |  |   |   |  |  |   |               | 

There were no transfers between Levels during the three months ended March 31, 2015 and 2014. All realized
and unrealized gains and losses are included in earnings (changes in net assets) and are reported as separate line items within the Companys consolidated statements of operations.

Net change in unrealized appreciation (depreciation) of Level 3 assets that were still held by the Company at March 31, 2015 and March 31, 2014
were $7,565,078 and $5,292,194, respectively.

The significant unobservable inputs used in the market approach of fair value measurement of
the Companys investments are the market multiples of earnings before income tax, depreciation and amortization (EBITDA) of the comparable guideline public companies. The independent valuation firms select a population of public
companies for each investment with similar operations and attributes of the subject company. Using these guideline public companies data, a range of multiples of enterprise value to EBITDA is calculated. The independent valuation firms select
percentages from the range of multiples for purposes of determining the subject companys estimated enterprise value based on said multiple and generally the latest twelve months EBITDA of the subject company (or other meaningful measure).
Significant increases or decreases in the multiple will result in an increase or decrease in enterprise value, resulting in an increase or decrease in the fair value estimate of the investment.

The significant unobservable input used in the income approach of fair value measurement of the Companys investments is the discount rate
or market yield used to discount the estimated future cash flows expected to be received from the underlying investment, which include both future principal and interest payments. Significant increases or decreases in the discount rate or market
yield would result in an decrease or increase in the fair value measurement. Included in the consideration and selection of discount rates or market yields are the following factors: risk of default, rating of the investment and comparable company
investments, and call provisions.



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The ranges of significant unobservable inputs used in the fair value measurement of the
Companys Level 3 investments as of March 31, 2015 were as follows:

EBITDA Multiples:



|                  |  |                                   |  |        |  |        |  |                  |  | 
|----------------- |  | --------------------------------- |  | ------ |  | ------ |  | ---------------- |  | 
|                  |  |                                   |  | Low    |  | High   |  | Weighted Average |  | 
|EBITDA Multiples: |  |                                   |  |        |  |        |  |                 
|                  |  | Senior secured notes              |  | n/a    |  | n/a    |  | n/a              |  | 
|                  |  | Unsecured debt                    |  | 5.10x  |  | 5.93x  |  | 5.52x            |  | 
|                  |  | Subordinated debt                 |  | 0.80x  |  | 0.90x  |  | 0.85x            |  | 
|                  |  | Senior secured loans              |  | 5.70x  |  | 6.64x  |  | 6.17x            |  | 
|                  |  | Preferred stock                   |  | 5.38x  |  | 6.06x  |  | 5.72x            |  | 
|                  |  | Common stock                      |  | 6.28x  |  | 7.01x  |  | 6.64x            |  | 
|                  |  | Limited partnerships/LLC interest |  | 8.66x  |  | 9.46x  |  | 9.06x            |  | 
|                  |  | Equity warrants/options           |  | 6.62x  |  | 7.34x  |  | 6.98x            |  | 
|                  |  |                                   |  |       
|Market Yields:    |  |                                   |  |        |  |        |  |                 
|                  |  | Senior secured notes              |  | 14.10% |  | 15.70% |  | 14.90%           |  | 
|                  |  | Unsecured debt                    |  | 13.81% |  | 14.31% |  | 14.06%           |  | 
|                  |  | Subordinated debt                 |  | 10.63% |  | 11.38% |  | 11.00%           |  | 
|                  |  | Senior secured loans              |  | 10.59% |  | 11.51% |  | 11.05%           |  | 
|                  |  | Preferred stock                   |  | 13.50% |  | 13.50% |  | 13.50%           |  | 
|                  |  | Common stock                      |  | n/a    |  | n/a    |  | n/a              |  | 
|                  |  | Limited partnerships/LLC interest |  | n/a    |  | n/a    |  | n/a              |  | 
|                  |  | Equity warrants/options           |  | n/a    |  | n/a    |  | n/a              |  | 

The ranges of significant unobservable inputs used in the fair value measurement of the Companys Level 3
investments as of December 31, 2014 were as follows:



|                  |  |                                   |  |        |  |        |  |                  |  | 
|----------------- |  | --------------------------------- |  | ------ |  | ------ |  | ---------------- |  | 
|                  |  |                                   |  | Low    |  | High   |  | Weighted Average |  | 
|EBITDA Multiples: |  |                                   |  |        |  |        |  |                 
|                  |  | Senior secured notes              |  | n/a    |  | n/a    |  | n/a              |  | 
|                  |  | Unsecured debt                    |  | 5.03x  |  | 5.86x  |  | 5.45x            |  | 
|                  |  | Subordinated debt                 |  | 4.50x  |  | 5.50x  |  | 5.00x            |  | 
|                  |  | Senior secured loans              |  | 5.68x  |  | 6.62x  |  | 6.15x            |  | 
|                  |  | Preferred stock                   |  | 5.42x  |  | 6.06x  |  | 5.74x            |  | 
|                  |  | Common stock                      |  | 7.84x  |  | 8.79x  |  | 8.32x            |  | 
|                  |  | Limited partnerships/LLC interest |  | 8.04x  |  | 8.80x  |  | 8.42x            |  | 
|                  |  | Equity warrants/options           |  | 6.35x  |  | 7.12x  |  | 6.73x            |  | 
|                  |  |                                   |  |       
|Market Yields:    |  |                                   |  |        |  |        |  |                 
|                  |  | Senior secured notes              |  | 14.40% |  | 16.00% |  | 15.20%           |  | 
|                  |  | Unsecured debt                    |  | 13.92% |  | 14.75% |  | 14.33%           |  | 
|                  |  | Subordinated debt                 |  | 11.42% |  | 12.58% |  | 12.00%           |  | 
|                  |  | Senior secured loans              |  | 10.57% |  | 11.54% |  | 11.06%           |  | 
|                  |  | Preferred stock                   |  | n/a    |  | n/a    |  | n/a              |  | 
|                  |  | Common stock                      |  | n/a    |  | n/a    |  | n/a              |  | 
|                  |  | Limited partnerships/LLC interest |  | n/a    |  | n/a    |  | n/a              |  | 
|                  |  | Equity warrants/options           |  | n/a    |  | n/a    |  | n/a              |  | 



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11. Financial highlights

The following per share data and ratios have been derived from information provided in the consolidated financial statements. The following is
a schedule of financial highlights for a common share outstanding during the three months ended March 31, 2015 and 2014.



|                                                                           |  |                                 |             |   |                                 |   |             |  
|-------------------------------------------------------------------------- |  | ------------------------------- | ----------- | - | ------------------------------- | - | ----------- | -
|                                                                           |  | Three monthsendedMarch 31, 2015 |             |   | Three monthsendedMarch 31, 2014 |  
|Per Share Data:                                                            |  |                                 |             |   |                                 |   |             |  
|Net asset value, beginning of period                                       |  | $                               | 10.49       |   |                                 | $ | 9.54        |  
|                                                                           |  |                                 |             |   |                                 |   |             |  
|Net investment income                                                      |  |                                 | 0.20        |   |                                 |   | 0.15        |  
|Net realized and unrealized gain                                           |  |                                 | 0.10        |   |                                 |   | 0.16        |  
|                                                                           |  |                                 |             |   |                                 |   |             |  
|Total from investment operations                                           |  |                                 | 0.30        |   |                                 |   | 0.31        |  
|Distributions to stockholders from net investment income                   |  |                                 | (0.21       | ) |                                 |   | (0.26       | )
|                                                                           |  |                                 |             |   |                                 |   |             |  
|Net increase (decrease) in net assets                                      |  |                                 | 0.09        |   |                                 |   | 0.05        |  
|                                                                           |  |                                 |             |   |                                 |   |             |  
|Net asset value, end of period                                             |  | $                               | 10.58       |   |                                 | $ | 9.59        |  
|                                                                           |  |                                 |             |   |                                 |   |             |  
|Market price, end of period                                                |  | $                               | 9.06        |   |                                 | $ | 9.17        |  
|                                                                           |  |                                 |             |   |                                 |   |             |  
|Total return(1)(2)                                                         |  |                                 | 13.47%      |   |                                 |   | 1.17%       |  
|Ratios / Supplemental Data:                                                |  |                                 |             |   |                                 |   |             |  
|Ratio of operating expenses to average net assets(3)(4)                    |  |                                 | 5.13%       |   |                                 |   | 6.89%       |  
|Ratio of interest and other debt related expenses to average net assets(3) |  |                                 | 3.29%       |   |                                 |   | 3.78%       |  
|                                                                           |  |                                 |             |   |                                 |   |             |  
|Ratio of total expenses to average net assets(3)(5)                        |  |                                 | 8.42%       |   |                                 |   | 10.67%      |  
|Ratio of net investment income to average net assets(3)                    |  |                                 | 7.56%       |   |                                 |   | 6.41%       |  
|Net assets, end of period                                                  |  | $                               | 789,904,991 |   |                                 | $ | 714,290,246 |  
|Average debt outstanding                                                   |  | $                               | 460,536,157 |   |                                 | $ | 482,367,741 |  
|Weighted average shares outstanding                                        |  |                                 | 74,664,007  |   |                                 |   | 74,517,547  |  
|Average debt per share(6)                                                  |  | $                               | 6.17        |   |                                 | $ | 6.47        |  
|Portfolio turnover                                                         |  |                                 | 4%          |   |                                 |   | 16%         |  





|(1) | Total return is based on the change in market price per share during the respective periods. Total return calculations take into account distributions, if any, reinvested in accordance with the Companys
dividend reinvestment plan and do not reflect brokerage commissions.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Not annualized.
|--- | ---------------

|(3) | Annualized.
|--- | -----------

|(4) | Ratio excluding capital gains incentive fee for the three months ended March 31, 2015 and 2014 is 4.43% and 4.89%, respectively.
|--- | --------------------------------------------------------------------------------------------------------------------------------

|(5) | Ratio excluding capital gains incentive fee for the three months ended March 31, 2015 and 2014 is 7.72% and 8.67%, respectively.
|--- | --------------------------------------------------------------------------------------------------------------------------------

|(6) | Average debt per share is calculated as average debt outstanding divided by the weighted average shares outstanding during the applicable period.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------

12. Subsequent events

On April 30,
2015, the Companys Board of Directors declared a distribution of $0.21 per share, payable on July 2, 2015 to stockholders of record at the close of business on June 18, 2015.

In addition to the subsequent events included in these notes to the consolidated financial statements, the Company conducted a review for
additional subsequent events and determined that no additional subsequent events had occurred that would require accrual or additional disclosures.



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##### Table of Contents

Item 2. Managements Discussion and Analysis of Financial Condition
and Results of Operations

The information contained in this section should be read in conjunction with the consolidated financial statements
and notes thereto appearing elsewhere in this report.

This report, and other statements that we may make, may contain forward-looking
statements with respect to future financial or business performance, strategies or expectations. Forward-looking statements are typically identified by words or phrases such as trend, opportunity, pipeline,
believe, comfortable, expect, anticipate, current, intention, estimate, position, assume, potential, outlook,
continue, remain, maintain, sustain, seek, achieve and similar expressions, or future or conditional verbs such as will, would, should,
could, may or similar expressions.

Forward-looking statements are subject to numerous assumptions, risks and
uncertainties, which change over time. Forward-looking statements speak only as of the date they are made, and we assume no duty to and do not undertake to update forward-looking statements. Actual results could differ materially from those
anticipated in forward-looking statements and future results could differ materially from historical performance.

In addition to factors
previously identified elsewhere in the reports BlackRock Capital Investment Corporation has filed with the Securities and Exchange Commission (the SEC), the following factors, among others, could cause actual results to differ materially
from forward-looking statements or historical performance:



| |  |  | our future operating results;
| | - |  | -----------------------------



| |  |  | our business prospects and the prospects of our portfolio companies;
| | - |  | --------------------------------------------------------------------



| |  |  | the impact of investments that we expect to make;
| | - |  | -------------------------------------------------



| |  |  | our contractual arrangements and relationships with third parties;
| | - |  | ------------------------------------------------------------------



| |  |  | the dependence of our future success on the general economy and its impact on the industries in which we invest;
| | - |  | ----------------------------------------------------------------------------------------------------------------



| |  |  | the ability of our portfolio companies to achieve their objectives;
| | - |  | -------------------------------------------------------------------



| |  |  | our expected financings and investments;
| | - |  | ----------------------------------------



| |  |  | the adequacy of our cash resources and working capital, including our ability to obtain continued financing on favorable terms;
| | - |  | -------------------------------------------------------------------------------------------------------------------------------



| |  |  | the timing of cash flows, if any, from the operations of our portfolio companies;
| | - |  | ---------------------------------------------------------------------------------



| |  |  | the impact of increased competition;
| | - |  | ------------------------------------



| |  |  | the ability of the Advisor to locate suitable investments for us and to monitor and administer our investments;
| | - |  | ---------------------------------------------------------------------------------------------------------------



| |  |  | potential conflicts of interest in the allocation of opportunities between us and other investment funds managed by the Advisor or its affiliates;
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | the ability of the Advisor to attract and retain highly talented professionals;
| | - |  | -------------------------------------------------------------------------------



| |  |  | fluctuations in foreign currency exchange rates; and
| | - |  | ----------------------------------------------------



| |  |  | the impact of changes to tax legislation and, generally, our tax position.
| | - |  | --------------------------------------------------------------------------

Overview

We were incorporated in Delaware on April 13, 2005 and were initially funded on July 25, 2005. Our investment objective is to
provide a combination of current income and capital appreciation. We intend to invest primarily in debt and equity securities of private and certain public U.S. middle-market companies.



41



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##### Table of Contents

We are externally managed and have elected to be regulated as a BDC under the 1940 Act. As a BDC,
we are required to comply with certain regulatory requirements. For instance, we generally have to invest at least 70% of our total assets in qualifying assets, including securities of private or thinly traded public U.S. companies,
cash, cash equivalents, U.S. Government securities and high-quality debt investments that mature in one year or less.

Investments

Our level of investment activity can and does vary substantially from period to period depending on many factors, including the
amount of debt and equity capital available to middle-market companies, the level of merger and acquisition activity, the general economic environment and the competitive environment for the types of investments we make.

As a BDC, we must not acquire any assets other than qualifying assets specified in the 1940 Act unless, at the time the acquisition
is made, at least 70% of our total assets are qualifying assets (with certain limited exceptions). Qualifying assets include investments in eligible portfolio companies. Under the relevant SEC rules, the term eligible portfolio
company includes all private companies, companies whose securities are not listed on a national securities exchange, and certain public companies that have listed their securities on a national securities exchange and have a market
capitalization of less than $250 million. These rules also permit us to include as qualifying assets certain follow-on investments in companies that were eligible portfolio companies at the time of initial investment but that no longer meet the
definition.

Revenues

We generate revenues primarily in the form of interest on the debt we hold, dividends on our equity interests and capital gains on the sale of
warrants and other debt or equity interests that we acquire in portfolio companies. Our investments in fixed income instruments generally have an expected maturity of three to ten years, although we have no lower or upper constraint on maturity, and
typically bear interest at a fixed or floating rate. Interest on our debt securities is generally payable quarterly or semi-annually. In some cases, our debt instruments and preferred stock investments may defer payments of cash interest or
dividends or pay interest or dividends in-kind. Any outstanding principal amount of our debt securities and any accrued but unpaid interest will generally become due at the maturity date. In addition, we may generate revenue in the form of
prepayment fees, commitment, origination, capital structuring or due diligence fees, fees for providing significant managerial assistance and consulting fees.

Expenses

Our
primary operating expenses include the payment of a base management fee and, depending on our operating results, an incentive management fee, expenses reimbursable under the management agreement, administration fees and the allocable portion of
overhead under the administration agreement. The base management fee and incentive management fee compensate the Advisor for work in identifying, evaluating, negotiating, closing and monitoring our investments. Our management agreement with the
Advisor provides that we will reimburse the Advisor for costs and expenses incurred by the Advisor for office space rental, office equipment and utilities allocable to the Advisor under the management agreement, as well as any costs and expenses
incurred by the Advisor relating to any non-investment advisory, administrative or operating services provided by the Advisor to us. We bear all other costs and expenses of our operations and transactions.

Critical accounting policies

Our
discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these consolidated financial statements requires
management to make estimates and assumptions that affect the



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reported amounts of assets, liabilities, revenues and expenses. Changes in the economic environment, financial markets and any other parameters used in determining such estimates could cause
actual results to differ.

Management considers the critical accounting policies important to understanding the consolidated financial
statements. In addition to the discussion below, our critical accounting policies are further described in the notes to the consolidated financial statements. See Note 2 to the consolidated financial statements for a description of significant
accounting policies and of recently issued accounting pronouncements.

Financial and operating highlights

At March 31, 2015:

Investment Portfolio:
$1,281.0 million

Net Assets: $789.9 million

Indebtedness (borrowings under Credit Facility, Convertible Notes, Term Loan and

Senior Secured Notes): $472.3 million

Net Asset Value per share: $10.58

Portfolio
Activity for the Three Months Ended March 31, 2015:

Cost of investments during period, including PIK: $46.3 million

Sales, repayments and other exits during period: $74.9 million

Number of portfolio companies at end of period: 45

Operating Results for the Three Months Ended March 31, 2015:

Net investment income per share: $0.20

Distributions declared per share: $0.21

Basic earnings per share: $0.30

Net investment income: $14.6 million

Net realized and unrealized gains: $8.0 million

Net increase in net assets from operations: $22.7 million

Net investment income per share, as adjusted1: $0.21

Basic earnings per share, as adjusted1: $0.32

Net investment income, as adjusted1: $15.7 million

As Adjusted1: Amounts are adjusted to remove the incentive management fee expense
based on Gains, as required by GAAP, and to include only the incremental incentive management fee expense based on Income. The incremental incentive management fee is based on each trailing four-fiscal quarter period, applied to the current
quarters incremental earnings, and without any reduction for incentive management fees paid during the prior three quarters. Amounts reflect the Companys ongoing operating results and reflect the Companys financial performance over
time.

Portfolio and investment activity

We invested $46.3 million during the three months ended March 31, 2015. The investments consisted primarily of senior secured loans
secured by first liens ($5.9 million, or 12.8%), or second liens ($26.0 million, or 56.2%), unsecured or subordinated debt securities and equity securities ($14.4 million, or 31.0%). Additionally, we received proceeds from sales/repayments and other
exits of approximately $74.9 million during the three months ended March 31, 2015.

At March 31, 2015, our portfolio of $1,281.0
million (at fair value) consisted of 45 portfolio companies and was invested 53% in senior secured loans, 20% in equity investments, 15% in unsecured or subordinated debt securities, 8% in senior secured notes, and 4% in cash and cash equivalents.
Our average investment by



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portfolio company at amortized cost, excluding investments below $5.0 million, was approximately $30.5 million at March 31, 2015. Our largest portfolio company investment by value was
approximately $70.3 million and our five largest portfolio company investments by value comprised approximately 25% of our portfolio at March 31, 2015. At December 31, 2014, our portfolio of $1,268.0 million (at fair value) consisted 47
portfolio companies was invested 52% in senior secured loans, 21% in equity investments, 18% in unsecured or subordinated debt securities, 8% in senior secured notes, and 1% in cash and cash equivalents. Our average investment by portfolio company
at amortized cost, excluding investments below $5.0 million, was approximately $29.4 million at December 31, 2014. Our largest portfolio company investment by value was approximately $71.0 million and our five largest portfolio company
investments by value comprised approximately 25% of our portfolio at December 31, 2014.

The weighted average yield of the debt and
income producing equity securities in our portfolio at fair value was 11.7% at March 31, 2015 and 11.7% at December 31, 2014. The weighted average yields on our senior secured loans and other debt securities at fair value were 11.2% and
13.0%, respectively, at March 31, 2015, versus 11.3% and 12.9%, respectively, at December 31, 2014. The weighted average yield of the debt and income producing equity securities in our portfolio at their current cost basis was 11.5% at
March 31, 2015 and 11.6% at December 31, 2014. The weighted average yields on our senior secured loans and other debt securities at their current cost basis were 11.1% and 12.7%, respectively, at March 31, 2015, versus 11.2% and
12.5%, respectively, at December 31, 2014. Yields exclude common equity investments, preferred equity investments with no stated dividend rate, short-term investments, and cash and cash equivalents.

The Advisor employs a grading system for our entire portfolio. The Advisor grades all loans on a scale of 1 to 4. This system is intended
to reflect the performance of the borrowers business, the collateral coverage of the loans and other factors considered relevant. Generally, the Advisor assigns only one loan grade to each portfolio company for all loan investments in that
portfolio company; however, the Advisor will assign multiple ratings when appropriate for different investments in one portfolio company. The following is a description of the conditions associated with each investment rating:

Grade 1: Investments in portfolio companies whose performance is substantially within the Advisors expectations and whose risk
factors are neutral to favorable to those at the time of the original investment.

Grade 2: Investments in portfolio companies
whose performance is below the Advisors expectations and that require closer monitoring; however, no loss of investment return (interest and/or dividends) or principal is expected.

Grade 3: Investments in portfolio companies whose performance is below the Advisors expectations and for which risk has increased
materially since origination. Some loss of investment return is expected, but no loss of principal is expected. Companies graded 3 generally will be out of compliance with debt covenants and will be unlikely to make debt repayments on their original
schedule.

Grade 4: Investments in portfolio companies whose performance is materially below the Advisors expectations where
business trends have deteriorated and risk factors have increased substantially since the original investment. Investments graded 4 are those for which some loss of principal is expected.



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The Advisor monitors and, when appropriate, changes the investment ratings assigned to each
investment in our portfolio. In connection with our valuation process, the Advisor and Board of Directors review these investment ratings on a quarterly basis. Our average investment rating was 1.32 at March 31, 2015 and 1.27 at
December 31, 2014. The following is a distribution of the investment ratings of our portfolio companies at March 31, 2015 and December 31, 2014:



|                  |  |                |               |  |                   |   |               | 
|----------------- |  | -------------- | ------------- |  | ----------------- | - | ------------- | 
|                  |  | March 31, 2015 |               |  | December 31, 2014 |  
|Grade 1           |  | $              | 924,151,307   |  |                   | $ | 980,351,780   | 
|Grade 2           |  |                | 245,503,717   |  |                   |   | 242,173,859   | 
|Grade 3           |  |                | 43,156,070    |  |                   |   | 11,074,000    | 
|Grade 4           |  |                | 22,315,222    |  |                   |   | 23,548,349    | 
|Not Rated         |  |                | 510,000       |  |                   |   | 568,750       | 
|                  |  |                |               |  |                   |   |               | 
|Total investments |  | $              | 1,235,636,316 |  |                   | $ | 1,257,716,738 | 
|                  |  |                |               |  |                   |   |               | 

Results of operations

Results comparisons for the three months ended March 31, 2015 and 2014.

Investment income

Investment income totaled $30,919,412 and $29,566,878, respectively, for the three months ended March 31, 2015 and 2014, of which
$18,921,192 and $16,084,881 were attributable to interest and fees on senior secured loans, $10,848,861 and $12,919,049 to interest and fees earned on other debt securities, $1,102,048 and $562,086 to dividends from preferred equity securities, $818
and $862 to interest earned on cash equivalents and $46,493 and zero to other income, respectively. For the three months ended March 31, 2015 and 2014 investment income included fees of $224,410 and $907,500, respectively. Interest income
earned was comprised of cash interest of approximately 98% as well as PIK interest of approximately 2% for the three months ended March 31, 2015. The increase in investment income for the three months ended March 31, 2015 was primarily due to
an increase in interest income.

Expenses

Expenses for the three months ended March 31, 2015 and 2014 were $16,295,835 and $18,472,683, respectively, which consisted of $6,370,630
and $6,160,619 in base management fees, $5,857,620 and $6,001,208 in interest and credit facility fees related to our debt, $1,377,907 and $3,459,865 in incentive management fees, $731,697 and $155,460 in administrative services, $513,357 and
$544,599 in amortization of debt issuance costs, $438,641 and $727,601 in professional fees, $202,307 and $532,806 in investment advisor expenses, $173,500 and $173,500 in director fees, and $630,176 and $717,025 in other expenses, respectively. The
decrease in expenses for the three months ended March 31, 2015 was primarily due to a decrease in incentive management fees.

Net investment income

Net investment income was $14,623,577 and $11,094,195 for the three months ended March 31, 2015 and 2014, respectively. The increase was
primarily a result of an increase in interest income and a decrease in incentive management fees.

Net realized gain or loss

Net realized gain of $8,346,859 for the three months ended March 31, 2015 was mainly the result of realized gains on the
sales of M&M Tradition Holdings Corp. and Marquette Transportation Company Holdings, LLC, offset by a realized loss on the restructuring of Red Apple Stores Inc. Net realized gain of $33,827,245 for the three months ended March 31, 2014 was
mainly the result of realized gains on the sale of Arclin Cayman Holdings, Ltd. (Arclin).



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Net unrealized appreciation or depreciation

For the three months ended March 31, 2015 and 2014, the change in net unrealized appreciation or depreciation was a decrease in net
unrealized appreciation of $314,817 and a decrease in net unrealized appreciation of $22,004,921, respectively. The decrease in net unrealized appreciation for the three months ended March 31, 2015 was primarily due to the reversal of
unrealized appreciation previously reported on M&M Tradition Holdings Corp. and Marquette Transportation Company Holdings LLC offset by an increase in portfolio company fair market value. The decrease in net unrealized appreciation for the three
months ended March 31, 2014 was due to the reversal of unrealized appreciation previously reported on Arclin.

Net increase in
net assets resulting from operations

The net increase in net assets resulting from operations for the three months ended
March 31, 2015 and 2014 was $22,655,619 and $22,916,519, respectively. The decrease in the current period is primarily attributed to the decrease in realized gains, offset by an increase in net investment income.

Supplemental Non-GAAP information

We report our financial results on a GAAP basis; however, management believes that evaluating our ongoing operating results may be enhanced if
investors have additional non-GAAP basis financial measures. Management reviews non-GAAP financial measures to assess ongoing operations and, for the reasons described below, considers them to be effective indicators, for both management and
investors, of our financial performance over time. Management does not advocate that investors consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.

We record our liability for Incentive Fees as we become legally obligated to pay them, based on a hypothetical liquidation at the end of each
reporting period. Our obligation to pay Incentive Fees with respect to any fiscal quarter is based on a formula that reflects our results over a trailing four-fiscal quarter period ending with the current fiscal quarter. We are legally obligated to
pay the amount resulting from the formula less any cash payments of Incentive Fees during the prior three quarters. The formulas requirement to reduce the Incentive Fees by amounts paid with respect to Incentive Fees in the prior three
quarters has caused our Incentive Fees expense to become, generally concentrated in the fourth quarter of each year. Management believes that reflecting Incentive Fees throughout the year, as the related investment income is earned on a quarterly
basis, is an effective measure of our profitability and financial performance that facilitates comparison of current results with historical results and with those of our peers. Our as adjusted results reflect Incentive Fees based on the
formula we utilize for each trailing four-fiscal quarter period, with the formula applied to the current quarters incremental earnings and without any reduction for Incentive Fees paid during the prior three quarters. The resulting amount
represents an upper limit of each quarters incremental Incentive Fees that we may become legally obligated to pay at the end of the year. Prior year amounts are estimated in the same manner. These estimates represent upper limits because, in
any calendar year, subsequent quarters investment underperformance could reduce the Incentive Fees payable with respect to prior quarters operating results. Changes in the economic environment, financial markets and other parameters used
in determining such estimates could cause actual results to differ and such differences could be material. See Note 3 to the consolidated financial statements in this Quarterly Report for a more detailed description of the Companys incentive
management fee.



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Computations for all periods are derived from our consolidated financial statements as follows:



|                                                                   |  |                                 |            |  |                                 |   |            | 
|------------------------------------------------------------------ |  | ------------------------------- | ---------- |  | ------------------------------- | - | ---------- | 
|                                                                   |  | Three monthsendedMarch 31, 2015 |            |  | Three monthsendedMarch 31, 2014 |  
|GAAP Basis:                                                        |  |                                 |            |  |                                 |   |            | 
|Net Investment Income                                              |  | $                               | 14,623,577 |  |                                 | $ | 11,094,195 | 
|Net Investment Income per share                                    |  |                                 | 0.20       |  |                                 |   | 0.15       | 
|Addback: GAAP incentive management fee expense based on Gains      |  |                                 | 1,366,846  |  |                                 |   | 3,459,865  | 
|Addback: GAAP incentive management fee expense based on Income     |  |                                 | 11,061     |  |                                 |   |           | 
|Pre-Incentive Fee1:                                                |  |                                 |            |  |                                 |   |            | 
|Net Investment Income                                              |  | $                               | 16,001,484 |  |                                 | $ | 14,554,060 | 
|Net Investment Income per share                                    |  |                                 | 0.21       |  |                                 |   | 0.20       | 
|Less: Incremental incentive management fee expense based on Income |  |                                 | 288,268    |  |                                 |   | 277,207    | 
|As Adjusted2:                                                      |  |                                 |            |  |                                 |   |            | 
|Net Investment Income                                              |  | $                               | 15,713,216 |  |                                 | $ | 14,276,853 | 
|Net Investment Income per share                                    |  |                                 | 0.21       |  |                                 |   | 0.19       | 

Pre-Incentive Fee1:Amounts are adjusted to remove all incentive
management fees. Such fees are calculated but not necessarily due and payable at this time.

As
Adjusted2: Amounts are adjusted to remove the incentive management fee expense based on Gains, as required by GAAP, and to include only the incremental incentive management fee expense based
on Income. The incremental incentive management fee is based on each trailing four-fiscal quarter period, applied to the current quarters incremental earnings, and without any reduction for incentive management fees paid during the prior three
quarters. Amounts reflect the Companys ongoing operating results and reflect the Companys financial performance over time.

Financial
condition, liquidity and capital resources

During the three months ended March 31, 2015, we generated operating cash flows
primarily from loan repayments, interest earned and fees received on senior secured loans and other debt securities

Net cash provided by
operating activities during the three months ended March 31, 2015 was $25,632,342. Our primary sources of cash from operating activities during the period consisted of a net increase in net assets from operations of $22,655,619, and net
proceeds from repayments, net of purchases, including PIK of $28,574,161.

Net cash provided by financing activities during the three
months ended March 31, 2015 was $9,377,099. Our primary source of cash from financing activities was $24,060,706 in proceeds from debt repayments, net of borrowings under the Credit Facility. An additional use of cash for financing activities
was $14,683,607 of distributions.



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Contractual obligations

A summary of our significant contractual payment obligations for the repayment of outstanding borrowings at March 31, 2015 is as follows:



|                                          |  |                                              |       |  |                  |   |       |           |  |   |           |  |  |               |       |  |  |   |   | 
|----------------------------------------- |  | -------------------------------------------- | ----- |  | ---------------- | - | ----- | --------- |  | - | --------- |  |  | ------------- | ----- |  |  | - | - | 
|                                          |  | Payments Due By Period (dollars in millions) |      
|                                          |  | Total                                        |       |  | Less than 1 year |   |       | 1-3 years |  |   | 3-5 years |  |  | After 5 years |      
|Credit Facility(1)                        |  | $                                            | 168.0 |  |                  | $ |      |           |  | $ |          |  |  | $             | 168.0 |  |  | $ |  | 
|Term Loan                                 |  |                                              | 15.0  |  |                  |   |      |           |  |   |          |  |  |               | 15.0  |  |  |   |  | 
|Senior Secured Notes                      |  |                                              | 175.0 |  |                  |   | 158.0 |           |  |   | 17.0      |  |  |               |      |  |  |   |  | 
|Convertible Notes                         |  |                                              | 114.3 |  |                  |   |      |           |  |   | 114.3     |  |  |               |      |  |  |   |  | 
|Interest and Credit Facility Fees Payable |  |                                              | 3.6   |  |                  |   | 3.6   |           |  |   |          |  |  |               |      |  |  |   |  | 



|(1) | At March 31, 2015, $231.8 million remained unused under our Credit Facility.
|--- | ----------------------------------------------------------------------------

Off-balance sheet arrangements

In the normal course of business, the Company may enter into guarantees on behalf of portfolio companies. Under these arrangements, the
Company would be required to make payments to third parties if the portfolio companies were to default on their related payment obligations. On March 24, 2015 the Company entered into a standby letter of credit on behalf of Red Apple Stores,
Inc in the amount of $5,250,000. No amounts were drawn at March 31, 2015. There were no such guarantees outstanding at March 31, 2014.

Distributions

Our quarterly
distributions, if any, are determined by our Board of Directors. Distributions are declared considering our estimate of annual taxable income available for distribution to stockholders and the amount of taxable income carried over from the prior
year for distribution in the current year. We cannot assure stockholders that they will receive any distributions at all or distributions at a particular level. The following table lists the quarterly distributions per share from our common stock
since March 2013.



|                                           |  |                    |  |                
|------------------------------------------ |  | ------------------ |  | ---------------
|Distributions Amount
Per Share
Outstanding |  | Record Date        |  | Payment Date   
|$0.26                                      |  | March 19, 2013     |  | April 2, 2013  
|$0.26                                      |  | June 18, 2013      |  | July 2, 2013   
|$0.26                                      |  | September 19, 2013 |  | October 3, 2013
|$0.26                                      |  | December 20, 2013  |  | January 3, 2014
|$0.26                                      |  | March 20, 2014     |  | April 3, 2014  
|$0.21                                      |  | June 18, 2014      |  | July 2, 2014   
|$0.21                                      |  | September 19, 2014 |  | October 3, 2014
|$0.21                                      |  | December 24, 2014  |  | January 7, 2015
|$0.21                                      |  | March 20, 2015     |  | April 3, 2015  
|$0.21                                      |  | June 18, 2015      |  | July 2, 2015   

Tax characteristics of all distributions are reported to stockholders on Form 1099 after the end of the calendar year.

We have elected to be taxed as a RIC under Subchapter M of the Code. In order to maintain favorable RIC tax treatment, we must distribute
annually 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, out of the assets legally available for distribution. Under the Regulated
Investment Company Modernization Act of 2010, capital losses



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incurred by the Company after December 31, 2010 will not be subject to expiration. In addition, such losses must be utilized prior to the losses incurred in the years preceding enactment. In
order to avoid certain excise taxes imposed on RICs, we must distribute during each calendar year an amount at least equal to the sum of:



| |  |  | 98% of our ordinary income for the calendar year;
| | - |  | -------------------------------------------------



| |  |  | 98.2% of our capital gains in excess of capital losses for the one-year period ending on October 31st; and
| | - |  | ----------------------------------------------------------------------------------------------------------



| |  |  | any ordinary income and net capital gains for preceding years that were not distributed during such years.
| | - |  | ----------------------------------------------------------------------------------------------------------

We maintain an opt out dividend reinvestment plan for our common stockholders. As a result, except as discussed below, if we
declare a distribution, stockholders cash distributions will be automatically reinvested in additional shares of our common stock, unless they specifically opt out of the dividend reinvestment plan so as to receive cash
distributions. With respect to our distributions paid to stockholders during the three months ended March 31, 2015 and 2014, distributions reinvested pursuant to our dividend reinvestment plan totaled $971,399 and $1,044,638, respectively.

Under the terms of an amendment to our dividend reinvestment plan adopted on March 4, 2009, distributions may be paid in newly issued or
treasury shares of our common stock at a price equal to 95% of the market price on the payment date. This feature of the plan means that, under certain circumstances, we may issue shares of our common stock at a price below net asset value per
share, which could cause our stockholders to experience dilution. We may not be able to achieve operating results that will allow us to make distributions at a specific level or to increase the amount of these distributions from time to time. Also,
we may be limited in our ability to make distributions due to the asset coverage test applicable to us as a BDC under the 1940 Act and due to provisions in our existing and future debt arrangements.

If we do not distribute a certain percentage of our income annually, we will suffer adverse tax consequences, including possible loss of
favorable RIC tax treatment. In addition, in accordance with U.S. generally accepted accounting principles and tax regulations, we include in income certain amounts that we have not yet received in cash, such as payment-in-kind interest, which
represents contractual interest added to the loan balance that becomes due at the end of the loan term, or the accrual of original issue or market discount. Since we may recognize income before or without receiving cash representing such income, we
may have difficulty meeting the requirement to distribute at least 90% of our investment company taxable income to obtain tax benefits as a RIC and may be subject to an excise tax. In order to satisfy the annual distribution requirement applicable
to RICs, we have the ability to declare a large portion of a dividend in shares of our common stock instead of in cash. As long as a portion of such dividend is paid in cash (which portion can be as low as 10% for our taxable years ending prior to
2012) and certain requirements are met, the entire distribution would be treated as a dividend for U.S. federal income tax purposes.

Recent
developments

On April 30, 2015, the Companys Board of Directors declared a distribution of $0.21 per share, payable on
July 2, 2015 to stockholders of record at the close of business on June 18, 2015.

Notice is hereby given in accordance with
Section 23(c) of the 1940 Act that from time to time the Company may purchase shares of its common stock in the open market at prevailing market prices.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are subject to financial market risks, including changes in interest rates. At March 31, 2015, 70% of our debt investments bore
interest based on floating rates, such as LIBOR, the Federal Funds Rate or the Prime Rate. The interest rates on such investments generally reset by reference to the current market index after one



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to six months. At March 31, 2015, the percentage of our total debt investments that bore floating rate interest based on an interest rate floor was 63%. Floating rate investments subject to
a floor generally reset by reference to the current market index after one to six months only if the index exceeds the floor.

While
hedging activities may help to insulate us against adverse changes in interest rates, they also may limit our ability to participate in the benefits of lower interest rates with respect to our portfolio of investments. During the three months ended
March 31, 2015 and 2014, we did not engage in any interest rate hedging activity.

Item 4. Controls and
Procedures

As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the
participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15 under the Securities Exchange
Act of 1934). Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our current disclosure controls and procedures are effective in timely alerting them to material information relating to us that is
required to be disclosed by us in the reports we file or submit under the Securities Exchange Act of 1934.

There have been no changes in
our internal control over financial reporting that occurred during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.



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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, we and the Advisor may be a party to certain legal proceedings incidental to the normal course of our business, including
the enforcement of our rights under contracts with our portfolio companies. While we cannot predict the outcome of these legal proceedings with certainty, we do not expect that these proceedings will have a material effect on our consolidated
financial statements.

Item 1A. Risk Factors

There have been no material changes from the risk factors previously disclosed in our most recent Form 10-K filing.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Sales of unregistered securities

None.

Issuer purchases of equity securities

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine
Safety Disclosures

Not Applicable

Item 5. 
Other Information

None.

Item 6. Exhibits.



|(a) | Exhibits.
|--- | ---------



31.1

Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2

Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32

Certification of CEO and CFO Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.




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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.



BLACKROCK CAPITAL INVESTMENT CORPORATIONDate: April 30, 2015

By:

/s/ Steven SterlingSteven SterlingChief Executive OfficerDate: April 30, 2015

By:

/s/ Corinne PankovcinCorinne PankovcinChief Financial Officer and Treasurer




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