Exhibit 10.2



FORM OF

INVESTMENT ADVISORY AGREEMENT

BETWEEN

ALCENTRA CAPITAL CORPORATION

AND

ALCENTRA NY, LLC



This Investment Advisory Agreement (this “Agreement”)
made this 5th day of May, 2014, by and between ALCENTRA CAPITAL CORPORATION, a Maryland corporation (the “Company”),
and ALCENTRA NY, LLC, a Delaware limited liability company (the “Adviser”).



WHEREAS, the Company is a newly organized closed-end
management investment fund that intends to elect to be treated as a business development company (“BDC”)
under the Investment Company Act of 1940, as amended (the “Investment Company Act”); and



WHEREAS, the Adviser is registered under the
Investment Advisers Act of 1940, as amended (the “Advisers Act”); and



WHEREAS, the Company desires to retain the Adviser
to furnish investment advisory and certain administrative services to the Company on the terms and conditions hereinafter set forth,
and the Adviser wishes to be retained to provide such services;



NOW, THEREFORE, in consideration of the premises
and for other good and valuable consideration, the parties hereby agree as follows:



1. Duties of the Adviser.



(a) The Company hereby employs the Adviser to
act as the investment adviser to the Company and to manage the investment and reinvestment of the assets of the Company, subject
to the supervision of the Board of Directors of the Company, (the “Board”), and provide certain administrative
services to the Company as set forth herein for the period and upon the terms herein set forth, (i) in accordance with the investment
objective, policies and restrictions that are set forth in the reports and/or registration statements that the Company files with
the Securities and Exchange Commission (the “SEC”) from time to time; (ii) in accordance with all other
applicable federal and state laws, rules and regulations, and the Company’s charter and by-laws; and (iii) in accordance
with the Investment Company Act. Without limiting the generality of the foregoing, the Adviser shall, during the term and subject
to the provisions of this Agreement (A) determine the composition of the portfolio of the Company, the nature and timing of the
changes therein and the manner of implementing such changes; (B) identify, evaluate and negotiate the structure of the investments
made by the Company; (C) execute, close, monitor and service the Company’s investments; (D) determine the securities and
other assets that the Company shall purchase, retain, or sell; (E) perform due diligence on prospective portfolio companies; (F)
provide the Company with such other investment advisory, research and related services as the Company may, from time to time, reasonably
require for the investment of its funds; (G) provide on the Company’s behalf significant managerial assistance to those portfolio
companies that have requested such assistance; and (H) provide the Company with office facilities, equipment, clerical, bookkeeping
and record keeping services at such office facilities and such other services as the Adviser, subject to review by the Board, shall
from time to time determine to be necessary or useful to the Company’s operations. The Adviser shall have the power and authority
on behalf of the Company to effectuate its investment decisions for the Company, including the execution and delivery of all documents
relating to the Company’s investments and the placing of orders for other purchase or sale transactions on behalf of the
Company. In the event that the Company determines to obtain debt financing, the Adviser shall arrange for such financing on the
Company’s behalf, subject to the oversight and approval of the Board.



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(b) The Adviser hereby accepts such employment
and agrees during the term hereof to render the services described herein for the compensation provided herein.



(c) The Adviser is hereby authorized to enter
into one or more sub-advisory agreements with other investment advisers (each, a “Sub-Adviser”) pursuant
to which the Adviser may obtain the services of the Sub-Adviser(s) to assist the Adviser in fulfilling its responsibilities hereunder.
Specifically, the Adviser may retain a Sub-Adviser to recommend specific securities or other investments based upon the Company’s
investment objective and policies, and work, along with the Adviser, in structuring, negotiating, arranging or effecting the acquisition
or disposition of such investments and monitoring investments on behalf of the Company, subject to the oversight of the Adviser
and the Company. The Adviser and not the Company shall be responsible for any compensation payable to any Sub-Adviser. Any sub-advisory
agreement entered into by the Adviser shall be in accordance with the requirements of the Investment Company Act and other applicable
federal and state law.



(d) The Adviser shall, for all purposes herein
provided, be deemed to be an independent contractor and, except as expressly provided or authorized herein, shall have no authority
to act for or represent the Company in any way or otherwise be deemed an agent of the Company.



(e) Subject to review by and the overall control
of the Board, the Adviser shall keep and preserve for the period required by the Investment Company Act any books and records relevant
to the provision of its investment advisory services to the Company and shall specifically maintain all books and records with
respect to the Company’s portfolio transactions and shall render to the Board such periodic and special reports as the Board
may reasonably request. The Adviser agrees that all records that it maintains for the Company are the property of the Company and
shall surrender promptly to the Company any such records upon the Company’s request, provided that the Adviser may retain
a copy of such records.



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2. Company’s Responsibilities and Expenses Payable by
the Company.



All personnel of the Adviser, except for the
Company’s Chief Compliance Officer and principal financial officer, when and to the extent engaged in providing investment
advisory and management services hereunder, and the compensation and routine overhead expenses of such personnel allocable to such
services, shall be provided and paid for by the Adviser and not by the Company. The Company’s Chief Compliance Officer and
principal financial officer and their respective staffs shall be employed by the Adviser; however the Company will reimburse the
Adviser for the compensation to such employees. The Company shall bear all other out-of-pocket costs and expenses of its operations
and transactions, including (without limitation) fees and expenses relating to: future offering expenses; the cost of calculating
the Company’s net asset value; the cost of effecting sales and repurchases of shares of the Company’s common stock
and other securities; management and incentive fees payable pursuant to this Agreement; fees payable to third parties relating
to, or associated with, making investments and valuing investments (including third-party valuation firms); interest payments and
other costs related to borrowings; transfer agent and custodial fees; fees and expenses associated with marketing efforts (including
attendance at investment conferences and similar events); federal and state registration fees; any exchange listing fees; federal,
state and local taxes; independent directors’ fees and expenses; brokerage commissions; costs of proxy statements, stockholders’
reports and notices; costs of preparing government filings, including periodic and current reports with the SEC; fidelity bond,
liability insurance and other insurance premiums; and printing, mailing, independent accountants and outside legal costs and all
other direct expenses incurred by either the Adviser or the Company in connection with administering the Company’s business.



3. Compensation of the Adviser.



The Company agrees to pay, and the Adviser agrees
to accept, as compensation for the services provided by the Adviser hereunder, a base management fee (“Base Management
Fee”) and an incentive fee (“Incentive Fee”) as hereinafter set forth. The Adviser may
agree to temporarily or permanently waive, in whole or in part, the Base Management Fee and/or the Incentive Fee. See Appendix
A for examples of how these fees are calculated.



(a) The Base Management Fee shall be calculated
at an annual rate of 1.75% of the Company’s gross assets, including assets purchased with borrowed funds or other forms of
leverage, but excluding any cash and cash equivalents so long as the Company’s gross assets are less than or equal to $625,000,000.
If the Company’s gross assets are greater than or equal to $625,000,001 but less than or equal to $750,000,000, the Base
Management Fee shall be calculated at an annual rate of 1.65% of the Company’s gross assets, including assets purchased with
borrowed funds or other forms of leverage, but excluding any cash and cash equivalents. If the Company’s gross assets are
greater than or equal to $750,000,001, the Base Management Fee shall be calculated at an annual rate of 1.50% of the Company’s
gross assets, including assets purchased with borrowed funds or other forms of leverage, but excluding any cash and cash equivalents.
For purposes of this Agreement, the term “cash and cash equivalents” will have the meaning ascribed to
it from time to time in the notes to the financial statements that the Company files with the SEC prepared in accordance with generally
accepted accounting principles. The Base Management Fee shall be payable quarterly in arrears, and shall be calculated based on
the average value of the Company’s gross assets, excluding cash and cash equivalents, at the end of the two most recently
completed calendar quarters. The Base Management Fee for any partial month or quarter shall be appropriately prorated.



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(b) The Incentive Fee shall consist of two parts,
as follows:



| | (i) | The first part, the ordinary income component, shall be calculated and payable quarterly in arrears based on the Company’s
“Pre-Incentive Fee Net Investment Income’’ for the immediately preceding quarter. For this purpose,
‘‘Pre-Incentive Fee Net Investment Income’’ means interest income, dividend income and any
other income (including any other fees, such as commitment, origination, structuring, diligence, managerial assistance and consulting
fees or other fees that the Company receives from portfolio companies) accrued during the quarter, minus the Company’s operating
expenses for the quarter (including the Base Management Fee, administrative expenses payable to the Adviser pursuant to this Agreement,
and any interest expense and any distributions paid on any issued and outstanding preferred stock, but excluding the Incentive
Fee and any offering expenses and other expenses not charged to operations but excluding certain reversals to the extent such reversals
have the effect of reducing previously accrued incentive fees based on the deferral of non-cash interest). Pre-Incentive Fee Net
Investment Income excludes, in the case of investments with a deferred interest feature (such as original issue discount, debt
instruments with payment-in-kind interest and zero coupon securities), accrued income that the Company has not yet received in
cash. Pre-Incentive Fee Net Investment Income does not include any realized capital gains, realized capital losses or unrealized
capital appreciation or depreciation. Pre-Incentive Fee Net Investment Income, expressed as a rate of return on the value of the
Company’s net assets at the end of the immediately preceding quarter, shall be compared to a ‘‘hurdle rate’’
of 2.0% per quarter (8.0% annualized), subject to a ‘‘catch-up’’ provision measured as of
the end of each quarter as set forth in more detail below. The Company will pay the Adviser the Incentive Fee with respect to the
Company’s Pre-Incentive Fee Net Investment Income for each quarter is as follows:
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| | · | No incentive fee is payable to the Adviser in any quarter in which the Company’s Pre-Incentive Fee Net Investment Income
does not exceed the hurdle rate of 2.0% (the “hurdle’’).
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | 50.0% of the Company’s Pre-Incentive Fee Net Investment Income with respect to that portion of such Pre-Incentive Fee
Net Investment Income, if any, that exceeds the hurdle rate but is less than or equal to 2.5% in any quarter (10.0% annualized)
is payable to the Adviser. This portion of the Pre-Incentive Fee Net Investment Income (which exceeds the hurdle rate but is less
than or equal to 2.5%) is referred to as the “catch-up.”
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | 20.0% of the amount of the Company’s Pre-Incentive Fee Net Investment Income, if any, that exceeds 2.5% in any quarter
(10.0% annualized) is payable to the Adviser once the hurdle is reached and the catch-up is achieved (20.0% of all Pre-Incentive
Fee Net Investment Income thereafter is allocated to the Adviser).
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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| | · | Notwithstanding anything herein to the contrary, the ordinary income component of the Incentive Fee shall be subject to a total
return requirement, and no Incentive Fee in respect of the Company’s Pre-Incentive Fee Net Investment Income will be payable
except to the extent 20.0% of the cumulative net increase in net assets resulting from operations over the then current and 11
preceding quarters exceeds the cumulative Incentive Fees accrued and/or paid for the 11 preceding quarters. In other words, any
ordinary income incentive fee that is payable in a calendar quarter will be limited to the lesser of (a) 20.0% of the amount by
which the Company’s Pre-Incentive Fee Net Investment Income for such calendar quarter exceeds the 2.0% hurdle, subject to
the catch-up provision, and (b) (x) 20.0% of the cumulative net increase in net assets resulting from operations for the then current
and 11 preceding calendar quarters minus (y) the cumulative incentive fees accrued and/or paid for the 11 preceding calendar
quarters. For the foregoing purpose, the “cumulative net increase in net assets resulting from operations”
is the amount, if positive, of the sum of Pre-Incentive Fee Net Investment Income, realized gains and losses and unrealized appreciation
and depreciation of the Company for the then current and 11 preceding calendar quarters. In addition, the portion of such incentive
fee that is attributable to deferred interest (such as payment-in-kind interest or original issue discount) will be paid to the
Adviser, together with interest thereon from the date of deferral to the date of payment, only if and to the extent the Company
actually receives such interest in cash, and any accrual thereof will be reversed if and to the extent such interest is reversed
in connection with any write-off or similar treatment of the investment giving rise to any deferred interest accrual. Any reversal
of such accounts would reduce net income for the quarter by the net amount of the reversal (after taking into account the reversal
of incentive fees payable) and would result in a reduction and possible elimination of the incentive fees for such quarter. There
is no accumulation of amounts on the hurdle rate from quarter to quarter, and accordingly there is no clawback of amounts previously
paid if subsequent quarters are below the quarterly hurdle, and there is no delay of payment if prior quarters are below the quarterly
hurdle. The Adviser has agreed to permanently waive any interest accrued on the portion of the incentive fee attributable to deferred
interest (such as payment-in-kind interest or original issue discount).
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| | (ii) | The second part of the incentive fee, the capital gains component, shall be determined and payable in arrears as of the end
of each fiscal year (or upon termination of the Agreement, as of the termination date), commencing with the fiscal year ended December
31, 2014 and shall equal 20.0% of the Company’s aggregate realized capital gains, if any, on a cumulative basis from inception
through the end of each fiscal year, computed net of all aggregate realized capital losses and unrealized aggregate capital depreciation
on a cumulative basis through the end of such year, less the aggregate amount of any previously paid capital gains incentive fees,
in each case calculated from the date of pricing of the initial public offering. If such amount is negative, then no capital gains
incentive fee will be payable for such year. Additionally, if the Agreement is terminated as of a date that is not a calendar year
end, the termination date will be treated as though it were a calendar year end for purposes of calculating and paying the capital
gains incentive fee.
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4. Covenants of the Adviser.



The Adviser covenants that it will maintain
its registration as an investment adviser under the Advisers Act. The Adviser agrees that its activities will at all times be in
compliance in all material respects with all applicable federal and state laws governing its operations and investments.



5. Brokerage Commissions.



The Adviser is hereby authorized, to the fullest
extent now or hereafter permitted by law, to cause the Company to pay a member of a national securities exchange, broker or dealer
an amount of commission for effecting a securities transaction in excess of the amount of commission another member of such exchange,
broker or dealer would have charged for effecting that transaction, if the Adviser determines in good faith, taking into account
such factors as price (including the applicable brokerage commission or dealer spread), size of order, difficulty of execution,
and operational facilities of the firm and the firm’s risk and skill in positioning blocks of securities, that such amount
of commission is reasonable in relation to the value of the brokerage and/or research services provided by such member, broker
or dealer, viewed in terms of either that particular transaction or its overall responsibilities with respect to the Company’s
portfolio, and constitutes the best net results for the Company.



6. Other Activities of the Adviser.



The services of the Adviser to the Company are
not exclusive, and the Adviser may engage in any other business or render similar or different services to others including, without
limitation, the direct or indirect sponsorship or management of other investment based accounts or commingled pools of capital,
however structured, having investment objectives similar to those of the Company, so long as its services to the Company hereunder
are not materially impaired thereby, and nothing in this Agreement shall limit or restrict the right of any manager, partner, member
(including its members and the owners of its members), officer or employee of the Adviser to engage in any other business or to
devote his or her time and attention in part to any other business, whether of a similar or dissimilar nature, or to receive any
fees or compensation in connection therewith (including fees for serving as a director of, or providing consulting services to,
one or more of the Company’s portfolio companies, subject to applicable law). So long as this Agreement or any extension,
renewal or amendment remains in effect, the Adviser shall be the only investment adviser for the Company, subject to the Adviser’s
right to enter into sub-advisory agreements. The Adviser assumes no responsibility under this Agreement other than to render the
services called for hereunder. It is understood that directors, officers, employees and stockholders of the Company are or may
become interested in the Adviser and its affiliates, as directors, officers, employees, partners, stockholders, members, managers
or otherwise, and that the Adviser and directors, officers, employees, partners, stockholders, members and managers of the Adviser
and its affiliates are or may become similarly interested in the Company as stockholders or otherwise.



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7. Responsibility of Dual Directors, Officers and/or Employees.



If any person who is a manager, partner, member,
officer or employee of the Adviser is or becomes a director, officer and/or employee of the Company and acts as such in any business
of the Company, then such manager, partner, member, officer and/or employee of the Adviser shall be deemed to be acting in such
capacity solely for the Company, and not as a manager, partner, member, officer or employee of the Adviser or under the control
or direction of the Adviser, even if paid by the Adviser.



8. Limitation of Liability of the Adviser; Indemnification.



The Adviser (and its officers, managers, partners,
agents, employees, controlling persons and members, and any other person or entity affiliated with the Adviser) shall not be liable
to the Company for any action taken or omitted to be taken by the Adviser in connection with the performance of any of its duties
or obligations under this Agreement or otherwise as an investment adviser of the Company (except to the extent specified in Section
36(b) of the Investment Company Act concerning loss resulting from a breach of fiduciary duty (as the same is finally determined
by judicial proceedings) with respect to the receipt of compensation for services, and the Company shall indemnify, defend and
protect the Adviser (and its officers, managers, partners, agents, employees, controlling persons and members, and any other person
or entity affiliated with the Adviser, each of whom shall be deemed a third party beneficiary hereof) (collectively, the “Indemnified
Parties”) and hold them harmless from and against all damages, liabilities, costs and expenses (including reasonable
attorneys’ fees and amounts reasonably paid in settlement) incurred by the Indemnified Parties in or by reason of any pending,
threatened or completed action, suit, investigation or other proceeding (including an action or suit by or in the right of the
Company or its security holders) arising out of or otherwise based upon the performance of any of the Adviser’s duties or
obligations under this Agreement or otherwise as an investment adviser of the Company. Notwithstanding the preceding sentence of
this Section 8 to the contrary, nothing contained herein shall protect or be deemed to protect the Indemnified Parties against
or entitle or be deemed to entitle the Indemnified Parties to indemnification in respect of, any liability to the Company or its
security holders to which the Indemnified Parties would otherwise be subject by reason of willful misfeasance, bad faith or gross
negligence in the performance of the Adviser’s duties or by reason of the reckless disregard of the Adviser’s duties
and obligations under this Agreement.



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9. Effectiveness, Duration and Termination of Agreement.



This Agreement shall become effective as of
the date above written. This Agreement shall remain in effect for two years from the date hereof,and thereafter shall continue
automatically for successive annual periods, provided that such continuance is specifically approved at least annually by (a) the
vote of the Board, or by the vote of a majority of the outstanding voting securities of the Company and (b) the vote of a majority
of the Company’s directors who are not parties to this Agreement or “interested persons” (as such term is defined
in Section 2(a)(19) of the Investment Company Act) of any such party, in accordance with the requirements of the Investment Company
Act and each of whom is an “independent director” under applicable NASDAQ Global Select Market listing standards. This
Agreement may be terminated at any time, without the payment of any penalty, upon 60 days’ written notice, by the vote of
persons holding a majority of the outstanding voting securities of the Company, or by the vote of the Board or by the Adviser.
This Agreement shall automatically terminate in the event of its “assignment” (as such term is defined for purposes
of Section 15(a)(4) of the Investment Company Act). The provisions of Paragraph 8 of this Agreement shall remain in full force
and effect, and the Adviser shall remain entitled to the benefits thereof as well as any amounts under Section 3 hereof through
the date of termination, notwithstanding any termination of this Agreement.



10. Notices.



Any notice under this Agreement shall be given
in writing, addressed and delivered or mailed, postage prepaid, to the other party at its principal office.



11. Amendments.



This Agreement may be amended by mutual consent.



12. Entire Agreement; Governing Law.



This Agreement contains the entire agreement
of the parties and supersedes all prior agreements, understandings and arrangements with respect to the subject matter hereof.
Notwithstanding the place where this Agreement may be executed by any of the parties hereto, this Agreement shall be construed
in accordance with the laws of the State of New York. For so long as the Company is regulated as a BDC under the Investment Company
Act, this Agreement shall also be construed in accordance with the applicable provisions of the Investment Company Act. In such
case, to the extent the applicable laws of the State of New York, or any of the provisions herein, conflict with the provisions
of the Investment Company Act, the latter shall control. To the fullest extent permitted by law, in the event of any dispute arising
out of the terms and conditions of this Agreement, the parties hereto consent and submit to the jurisdiction of the courts of the
State of New York in the county of New York and of the U.S. District Court for the Southern District of New York.



13. Counterparts. This Agreement may be executed in
counterparts by the parties hereto, each of which shall constitute an original counterpart, and all of which, together, shall constitute
one Agreement



14. Severability.If any term or other provision of
this Agreement is invalid, illegal or incapable of being enforced by any law or public policy, all other terms and provisions of
this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions
contemplated hereby is not affected in any manner materially adverse to any party.

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IN WITNESS WHEREOF, the parties hereto have
caused this Agreement to be duly executed on the date above written.



| | ALCENTRA CAPITAL CORPORATION
| | ----------------------------
| |                             
| | By:                         
| |                             
| |                             
| |                             
| | ALCENTRA NY, LLC            
| |                             
| | By:                         
| |                             
| |                             



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Appendix A



Examples of Quarterly Incentive Fee Calculation



Example 1: Income Related
Portion of Incentive Fee:



Alternative 1



Assumptions



Investment income (including interest, dividends, fees,
etc.) = 1.25%

Hurdle rate(1) = 2.0%

Management fee(2) = 0.4375%

Other expenses (legal, accounting, custodian, transfer agent,
etc.)(3) = 0.20%

Pre-incentive fee net investment income

(investment income – (management fee + other
expenses) = 0.6125%



Pre-incentive fee net investment income does
not exceed hurdle rate, therefore there is no income-related incentive fee.



Alternative 2



Assumptions



Investment income (including interest, dividends, fees,
etc.) = 2.9%

Hurdle rate(1) = 2.0%

Management fee(2) = 0.4375%

Other expenses (legal, accounting, custodian, transfer agent,
etc.)(3) = 0.20%

Pre-incentive fee net investment income

(investment income – (management fee + other
expenses) = 2.2625%



Incentive fee = 50% × Pre-incentive fee net investment
income (subject to “catch-up”)(4)

= 50% × (2.2625% – 2.0%)

= 0.13125%



Pre-incentive fee net investment income exceeds
the hurdle rate, but does not fully satisfy the “catch-up” provision, therefore the income related portion of the incentive
fee is 0.13125%.



Alternative 3



Assumptions



Investment income (including interest, dividends, fees,
etc.) = 3.5%

Hurdle rate(1) = 2.0%

Management fee(2) = 0.4375%

Other expenses (legal, accounting, custodian, transfer agent,
etc.)(3) = 0.20%

Pre-incentive fee net investment income

(investment income – (management fee + other
expenses) = 2.8625%



Incentive fee = 50% × Pre-incentive fee net investment
income

(subject to “catch-up”)(4)



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Incentive fee = 50% × “catch-up” + (20%
× (Pre-Incentive Fee Net Investment

Income – 2.5%))



“Catch-up” = 2.5% – 2.0%

= 0. 5%



Incentive fee = (50% × 0.5%) + (20% ×
(2.8625% – 2.5%))

= 0.25% + (20% × 0.3625%)

= 0.25% + 0.0725%

= 0.3225%



Pre-incentive fee net investment income exceeds
the hurdle rate, and fully satisfies the “catch-up” provision, therefore the income related portion of the incentive
fee is 0.3225%.






(1)	Represents 8.0% annualized hurdle rate.

(2)	Represents 1.75% annualized base management fee. For purposes
of these examples, we have assumed the maximum amount of Base Management Fee, or 1.75% of the Company’s gross assets.

(3)	Excludes organizational and offering expenses.

| | (4) | The “catch-up” provision is intended to provide our Adviser with an incentive fee of 20% on 50% of pre-incentive
fee net investment income as if a hurdle rate did not apply when our net investment income exceeds 2.5% in any fiscal quarter.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Example 2: Capital Gains
Portion of Incentive Fee(*):



Alternative 1:



Assumptions



Year 1: $2.0 million investment made in Company A (“Investment
A”), and $3.0 million investment made in Company B (“Investment B”)



Year 2: Investment A sold for $5.0 million and fair
market value (“FMV”) of Investment B determined to be $3.5 million



Year 3: FMV of Investment B determined to be $2.0 million



Year 4: Investment B sold for $3.25 million



The capital gains portion of the incentive fee would be:



Year 1: None



Year 2: Capital gains incentive fee of $0.6 million—($3.0 million
realized capital gains on sale of Investment A multiplied by 20%)



Year 3: None—$0.4 million (20% multiplied by
($3.0 million cumulative capital gains less $1.0 million cumulative capital depreciation)) less $0.6 million (previous
capital gains fee paid in Year 2)



Year 4: Capital gains incentive fee of $50,000—$0.65 million
($3.25 million cumulative realized capital gains multiplied by 20%) less $0.6 million (capital gains incentive fee taken
in Year 2)



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Alternative 2



Assumptions



Year 1: $2.0 million investment made in Company A (“Investment
A”), $5.25 million investment made in Company B (“Investment B”) and $4.5 million investment made in
Company C (“Investment C”)



Year 2: Investment A sold for $4.5 million, FMV of
Investment B determined to be $4.75 million and FMV of Investment C determined to be $4.5 million



Year 3: FMV of Investment B determined to be $5.0 million
and Investment C sold for $5.5 million



Year 4: FMV of Investment B determined to be $6.0 million



Year 5: Investment B sold for $4.0 million



The capital gains incentive fee, if any, would be:



Year 1: None



Year 2: $0.4 million capital gains incentive fee—20%
multiplied by $2.0 million ($2.5 million realized capital gains on Investment A less $0.5 million unrealized capital
depreciation on Investment B)



Year 3: $0.25 million capital gains incentive fee(1)—$0.65 million
(20% multiplied by $3.25 million ($3.5 million cumulative realized capital gains less $0.25 million unrealized capital
depreciation)) less $0.4 million capital gains incentive fee received in Year 2



Year 4: $0.05 million capital gains incentive fee—$0.7 million
($3.50 million cumulative realized capital gains multiplied by 20%) less $0.65 million cumulative capital gains incentive
fee paid in Year 2 and Year 3



Year 5: None—$0.45 million (20% multiplied by
$2.25 million (cumulative realized capital gains of $3.5 million less realized capital losses of $1.25 million))
less $0.7 million cumulative capital gains incentive fee paid in Year 2, Year 3 and Year 4(2)








| | * | The hypothetical amounts of returns shown are based on a percentage of our total net assets and assume no leverage. There
is no guarantee that positive returns will be realized and actual returns may vary from those shown in this example.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (1) | As illustrated in Year 3 of Alternative 1 above, if a portfolio company were to be wound up on a date other than its fiscal
year end of any year, it may have paid aggregate capital gains incentive fees that are more than the amount of such fees that would
be payable if such portfolio company had been wound up on its fiscal year end of such year.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (2) | As noted above, it is possible that the cumulative aggregate capital gains fee received by our Adviser ($0.70 million)
is effectively greater than $0.45 million (20% of cumulative aggregate realized capital gains less net realized capital losses
or net unrealized depreciation ($2.25 million)).
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