BLACKROCK CAPITAL INVESTMENT CORP Management’s Discussion and Analysis of Financial Condition and Results of Operations (Form 10-Q/A)

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

Forward-looking statements

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 the investments we plan 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 financial condition and ability of our current and potential portfolio companies to achieve their objectives;

our planned financing and investments;

the adequacy of our cash resources and working capital, including our ability to obtain ongoing financing on favorable terms;

the cash flow timing, if any, of our portfolio companies’ operations;

the impact of increased competition;

the impact of COVID-19 on our portfolio companies and the markets in which they operate, interest rates and the economy generally;

the ability of the adviser to find suitable investments for us and to monitor and administer our investments;

changes in laws and policies accompanying the new administration and the uncertainty pending such changes;

worsening geopolitical unrest, terrorist attacks or acts of war, which may adversely affect the general economy, national and local financial and capital markets, or specific sectors of our portfolio companies;

changes and volatility in political, economic or industry conditions, the interest rate environment, currency exchange rates or financial and capital markets;

adverse resolution of legal proceedings; and

the impact of changes in tax legislation and, generally, our tax position.

Insight

We were incorporated in Delaware on April 13, 2005 and commenced operations with
private funding on July 25, 2005, and completed our initial public offering on
July 2, 2007. Our investment objective is to generate both current income and
capital appreciation through debt and equity investments. We invest primarily in
middle-market companies in the form of senior debt securities and loans, and our
investment portfolio may include junior secured and unsecured debt securities
and loans, each of which may include an equity component.

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.

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Certain previously reported items may have been reclassified to conform to the current year’s presentation.

Investments

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

As a BDC, we generally do 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 most
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. As of June 30, 2022, approximately 13.8% of the total assets of the
Company were not qualifying assets under Section 55(a) of the 1940 Act.

Revenue

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 monthly, 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 fees, end-of-term or exit fees, for providing significant
managerial assistance, and other investment related income.

Expenses

Our primary operating expenses include the payment of a Management Fee and,
depending on our operating results, Incentive Fees, interest and credit facility
fees, expenses reimbursable under the Current Management Agreement, professional
fees, administration fees and the allocable portion of overhead under the
administration agreement. The Management Fee and Incentive Fee compensate the
Advisor for work in identifying, evaluating, negotiating, closing and monitoring
our investments. Our Current 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 Current 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.

Significant Accounting Policies and Estimates

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 in conformity with GAAP requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the consolidated
financial statements, as well as the reported amounts of revenues and expenses
during the reporting periods presented. Although management believes these
estimates and assumptions to be reasonable, actual results could differ from
those estimates and such differences could be material.

Management considers the significant accounting policies important to
understanding the consolidated financial statements. In addition to the
discussion below, our significant 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. Management considers
Investments to be an area deemed a critical accounting policy as a result of the
judgments necessary for management to select valuation methodologies and to
select significant unobservable inputs to estimate fair value. Additionally, the
SEC has adopted Rule 2a-5 (the "Rule") under the 1940 Act. Pursuant to the Rule,
the Company's Board of Directors may designate a valuation designee to perform
certain fair value functions, including performing fair value determinations. It
is anticipated that the Company will be in compliance with the Rule on or before
the formal SEC compliance date on September 8, 2022 (see Note 2 to the
consolidated financial statements).

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Financial and operational highlights

At June 30, 2022:
Investment portfolio, at fair value: $557.4 million
Net assets: $335.4 million
Indebtedness, excluding deferred issuance costs: $238.0 million
Net asset value per share: $4.57

Portfolio activity for the three months ended June 30, 2022: Cost of investments over the period, including PIK: $73.5 million
Sales, refunds and other outflows during the period: $25.1 million
Number of companies in portfolio at the end of the period: 100

Operating Results for the Three Months Ended June 30, 2022:
Net investment income per share: $0.10
Distributions declared per share: $0.10
Basic earnings (loss) per share: $(0.03)
Net investment income: $7.1 million
Net realized and unrealized gain (loss): $(9.7) million
Net increase (decrease) in net assets from operations: $(2.5) million
Net investment income per share, as adjusted1: $0.08
Basic earnings (loss) per share, as adjusted1: $(0.05)
Net investment income, as adjusted1: $6.0 million
Net increase (decrease) in net assets from operations, as adjusted1: $(3.6)
million

As Adjusted1: The Company reports its financial results in accordance with GAAP;
however, management believes evaluating the Company's ongoing operating results
may be enhanced if investors have additional non-GAAP financial measures. See
"Supplemental Non-GAAP information" for further information on non-GAAP
financial measures and for as adjusted items, which are adjusted to remove the
impact of the accrued hypothetical liquidation basis incentive fee expense
reversal based on capital gains that was recorded, as required by GAAP, and to
include only the incremental incentive fee based on income. Under the Current
Management Agreement, incentive fee expense based on income is calculated for
each calendar quarter and may be paid on a quarterly basis if certain thresholds
are met. Adjusted amounts reflect the fact that no Incentive Fee on capital
gains was realized and payable to the Advisor during the three months ended June
30, 2022.

Portfolio and investment activity

We invested approximately $73.5 million, including PIK, during the three months
ended June 30, 2022. The new investments consisted of senior secured loans
secured by first lien ($62.7 million, or 85.4%) or second lien ($10.7 million,
or 14.5%) and equity securities ($0.1 million, or 0.1%). Additionally, we
received proceeds from sales, repayments and other exits of approximately $25.1
million during the three months ended June 30, 2022.

Concentration of our assets in an issuer, industry or sector may present certain
risks. To the extent that we assume large positions in the securities of a small
number of issuers, our net asset value may fluctuate to a greater extent than
that of a diversified investment company as a result of changes in the financial
condition or the market's assessment of the issuer. At June 30, 2022, our
portfolio of $557.4 million (at fair value) consisted of 100 portfolio companies
and was invested approximately 93% in senior secured loans, 4% in unsecured or
subordinated debt securities, 2% in equity investments, and less than 1% in
senior secured notes. Our average investment by portfolio company at amortized
cost was approximately $6.3 million at June 30, 2022. Our largest portfolio
company investment at fair value was approximately $24.9 million and our five
largest portfolio company investments at fair value comprised approximately 15%
of our portfolio at June 30, 2022. At December 31, 2021, our portfolio of $552.6
million (at fair value) consisted of 86 portfolio companies and was invested 93%
in senior secured loans, 5% in unsecured or subordinated debt securities, 2% in
equity investments and less than 1% in senior secured notes. Our average
investment by portfolio company at amortized cost was approximately $7.1 million
at December 31, 2021. Our largest portfolio company investment at fair value was
approximately $37.3 million and our five largest portfolio company investments
by value comprised approximately 21% of our portfolio at December 31, 2021.

In addition, we may, from time to time, invest a substantial portion of our
assets in the securities of issuers in any single industry or sector of the
economy or in only a few issuers. A downturn in an industry or sector in which
we are concentrated could have a larger impact on us than on a company that does
not concentrate in that particular industry or sector. Our Advisor monitors
industry and sector uncertainties on an ongoing basis, including substantial
regulatory challenges in the healthcare sector, volatility and extensive
government regulation in the financial services sector, cyclical risks
associated with the overall economy and events outside of our control, including
public health crises such as COVID-19, or other geopolitical or macroeconomic
events (see Item 1A. Risk Factors for further details), which may have resulted
in a negative impact to certain industries, including significant reductions in
demand for certain goods and services, reductions in business activity and
financial transactions, supply chain interruptions and overall economic and
financial market instability both globally and in the United States (see Note 5
to the consolidated financial statements), among various other industry and
sector uncertainties due to certain exposures. At June 30, 2022, our top three
industry concentrations at fair value consisted of Diversified Financial
Services (12.8%), Internet Software & Services (11.6%), and Software (10.8%). At
December 31, 2021, our top three industry concentrations at fair value consisted
of Diversified Financial Services (13.6%), Internet Software & Services (11.2%)
and Road & Rail (10.5%) (see Note 5 to the consolidated financial statements).

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The weighted average returns of the portfolio at fair value and at cost June 30, 2022
and December 31, 2021 were the following:

                                           June 30, 2022                    

December 31, 2021

                                    Fair Value           Cost          Fair Value             Cost
Weighted Average Yield(1)
Total portfolio                              9.1 %            8.2 %             8.5 %              7.6 %
Senior secured loans                         9.6 %            9.6 %             9.0 %              9.0 %
Other debt securities                        2.4 %            1.4 %             1.9 %              1.1 %
Debt and income producing
equity securities                            9.3 %            9.0 %             8.7 %              8.4 %



(1)
Computed as (a) the annual stated interest rate or yield earned plus the net
annual amortization of original issue discount, divided by (b) the amortized
cost or at fair value of each category, as applicable. The calculation excludes
exit fees that are receivable upon repayment of certain loan investments.



For the three and six months ended June 30, 2022, the total return based on net
asset value was (0.2)% and 1.4%, respectively. For the three and six months
ended June 30, 2022, the total return based on market price was (10.6)% and
(3.7)%, respectively. For the three and six months ended June 30, 2021, the
total return based on net asset value was 10.3% and 16.4%, respectively. For the
three and six months ended June 30, 2021, the total return based on market price
was 20.3% and 53.8%, respectively. Total returns are historical and are
calculated by determining the percentage change in the net asset value or market
price with all distributions reinvested, if any. Distributions are assumed to be
reinvested in accordance with the Company's dividend reinvestment plan and do
not reflect brokerage commissions.

The Advisor generally 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 or above the Advisor's original base case expectations and whose risk
factors are neutral to favorable to those at the time of the original investment
or subsequent restructuring.

Class 2: Investments in portfolio companies that perform significantly below the advisor’s initial baseline scenario expectations or risk factors have increased since the time of the initial investment or subsequent restructuring. No loss of return on investment or principal (or invested capital) is expected.

Class 3: Investments in portfolio companies that perform significantly below the advisor’s initial baseline scenario expectations or risk factors have increased significantly since the time of the initial investment or subsequent restructuring. Some loss of investment return is expected, but no loss of capital (or invested capital) is expected.

Class 4: Investments in portfolio companies that perform significantly below the advisor’s initial base case expectations or risk factors have increased significantly since the time of the initial investment or subsequent restructuring. Some loss of principal (or invested capital) is expected.

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 weighted average investment rating was 1.27 at June 30,
2022 and 1.21 at December 31, 2021. The following is a distribution of the
investment ratings of our portfolio companies, at fair value, at June 30, 2022
and December 31, 2021:

                      June 30,        December 31,
                        2022              2021
Grade 1             $ 443,045,874     $ 474,466,652
Grade 2                89,984,385        49,356,296
Grade 3                         -                 -
Grade 4                19,340,520        22,579,310
Not Rated(1)            5,023,500         6,161,736

Total investments $557,394,279 $552,563,994

(1)

Not Rated category at June 30, 2022 consists primarily of the Company's residual
equity investments in Stitch Holdings, L.P. Not Rated category as of December
31, 2021 consists primarily of the Company's residual equity investments in
Stitch Holdings, L.P. and AGY Equity, LLC. For purposes of calculating our
weighted average investment rating, the Not Rated category is excluded.

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Operating results

Comparisons of results for the three months ended June 30, 2022 and 2021.

Investment income
                                                            Three Months Ended
                                                    June 30, 2022       June 30, 2021
Investment income
Interest and fees on senior secured loans          $    12,004,839     $    

10,184,389

Interest and fees on other debt securities                 149,298          

136 106

Interest earned on short-term investments, cash
equivalents                                                 36,089          

356

Dividends and fees on equity securities                     78,729              536,908
Total investment income                            $    12,268,955     $     10,857,759


Total investment income for the three months ended June 30, 2022 increased $1.4
million, or 13.0%, as compared to the three months ended June 30, 2021. The
increase was primarily due to a 16.8% higher average balance in senior secured
loans, at amortized cost, during the three months ended June 30, 2022, and an
increase in fee and other one-time income of $0.4 million period over period as
a result of certain exited investments during the quarter. The increase in
portfolio size is primarily due to net deployments during 2021 and the first
half of 2022, which were substantially all in senior secured debt. These
increases are partially offset by a decrease in dividend income of $0.5 million
period over period, which is attributable to the exit of BCIC Senior Loan
Partners, LLC ("Senior Loan Partners") during December 2021.

Expenses
                                                      Three Months Ended
                                               June 30, 2022       June 30, 2021
Operating expenses
Interest and other debt expenses              $     2,860,691     $     2,969,177
Management fees                                     1,947,167           1,775,684
Incentive fees on income                               69,343                   -
Incentive fees on capital gains                    (1,073,068 )                 -
Administrative expenses                               299,262             314,886
Professional fees                                     207,489             254,834
Insurance expense                                     196,114             201,597
Director fees                                         153,125             153,125
Investment advisor expenses                            25,819              87,500
Other operating expenses                              462,797             258,232

Total expenses, before waiver of profit-sharing bonus 5,148,739 6,015,035 Waiver of profit-sharing bonus

                                        -               

Total expenses, net of incentive bonus waiver $5,148,739 $6,015,035


Total expenses, net of incentive fee waiver, decreased $0.9 million, or 14.4%,
for the three months ended June 30, 2022 from the comparable period in 2021,
primarily due to the reversal of previously accrued incentive fees on capital
gains, as required by GAAP during the three months ended June 30, 2022.

The Company is required under GAAP to accrue a hypothetical liquidation basis
incentive fee on capital gains, based upon net realized capital gains and
unrealized capital appreciation and depreciation on investments held at the end
of each period. If the resulting calculation amount is negative, the accrual for
GAAP in a given period may result in the reduction or reversal of Incentive Fees
on capital gains accrued in a prior period (see Note 3 to the consolidated
financial statements). The accrual (reversal) of Incentive Fees on capital gains
was approximately $(1.1) million and zero during the three months ended June 30,
2022 and 2021, respectively. As of June 30, 2022 and December 31, 2021, the
balance of accrued Incentive Fees on capital gains was zero and $1.5 million,
respectively. However, as of December 31, 2021 no Incentive Fees on capital
gains were realized and payable to the Advisor as of such date.

For the three months ended June 30, 2022and 2021, the Company has committed $0.1 million and zero, respectively, revenue-based incentive commissions.

Net investment income

Net investment income was $7.1 million and $4.8 million for the three months
ended June 30, 2022 and 2021, respectively. The increase of approximately $2.3
million, or 47.0%, was due to a $1.4 million increase in total investment
income, coupled with a $0.9 million decrease in expenses described above.

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Net realized gain or loss

There was no net realized gain (loss) recorded for the three months ended June
30, 2022. Net realized gain (loss) for the three months ended June 30, 2021 was
approximately $(8.7) million, primarily due to the full exit of our debt and
equity positions in Red Apple Stores Inc. Substantially all of the net realized
losses were reflected in unrealized depreciation in prior periods.

Net unrealized gain or loss

For the three months ended June 30, 2022 and 2021, the change in net unrealized
appreciation or depreciation on our investments, Interest Rate Swap, and foreign
currency translation was an increase in net unrealized depreciation of $(9.7)
million and a decrease in net unrealized depreciation of $35.9 million,
respectively. The increase in net unrealized depreciation for the three months
ended June 30, 2022 was primarily due to i) an overall increase in valuation
depreciation across our portfolio due to spread widening and general market
declines during the quarter (see Item 1A. Risk Factors), out of which our
investments in Zest Acquisition Corp., Thras.io, LLC, Razor Group GmbH and
Magenta Buyer, LLC contributed to $(2.8) million of that decrease; ii) a $(1.5)
million increase in valuation depreciation in our investment in Juul Labs Inc;
partially offset by iii) a $0.8 million decrease in unrealized depreciation in
Gordon Brothers Finance Company, including the reversal of $2.0 million of
previously recognized depreciation as a result of a paydown during the quarter
and $(1.2) million of valuation depreciation during the quarter. The decrease in
net unrealized depreciation for the three months ended June 30, 2021 was
primarily due to a $23.2 million increase in the fair value of SVP-Singer
Holdings, LP, based on expected proceeds on the sale of the portfolio company
which successfully closed in July 2021, and an $8.4 million reversal of
previously recognized depreciation, including foreign currency translation,
related to the full exit of our debt and equity investments in Red Apple Stores
Inc.

Net increase or decrease in net assets resulting from operations

The net increase or (decrease) in net assets resulting from operations for the
three months ended June 30, 2022 and 2021 was $(2.5) million and $32.0 million,
respectively. As compared to the prior period, the decrease is reflective of net
realized and unrealized gain (loss) of $(9.7) million for the current period, as
compared to $27.2 million of net realized and unrealized gain (loss) for the
three months ended June 30, 2021, the impact of which was partially offset by an
increase in net investment income of approximately $2.3 million
period-over-period.

Comparisons of results for the six months ended June 30, 2022 and 2021.

Investment income
                                                             Six Months Ended
                                                    June 30, 2022        June 30, 2021
Investment income
Interest and fees on senior secured loans          $     23,973,523     $   

19,575,574

Interest and fees on other debt securities                  285,205         

433 903

Interest earned on short-term investments, cash
equivalents                                                  37,903         

1,431

Dividends and fees on equity securities                     154,611            1,119,475
Total investment income                            $     24,451,242     $     21,130,383


Total investment income for the six months ended June 30, 2022 increased $3.3
million, or 15.7%, as compared to the six months ended June 30, 2021. The
increase was primarily due to a 22.8% higher average balance in senior secured
loans, at amortized cost, during the six months ended June 30, 2022, and an
increase in fee and other one-time income of $1.0 million period over period as
a result of certain exited investments during the period. The increase in
portfolio size is primarily due to net deployments during 2021 and the first
half of 2022, which were substantially all in senior secured debt. These
increases are partially offset by a decrease in dividend income of $1.0 million
period over period, which is attributable to the exit of Senior Loan Partners
during December 2021.

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Expenses
                                                       Six Months Ended
                                               June 30, 2022       June 30, 2021
Operating expenses
Interest and other debt expenses              $     5,589,642     $     5,722,273
Management fees                                     4,007,031           3,575,450
Incentive fees on income                               88,356                   -
Incentive fees on capital gains                    (1,544,569 )                 -
Administrative expenses                               664,769             637,001
Professional fees                                     510,346             666,993
Insurance expense                                     395,872             400,961
Director fees                                         306,250             306,250
Investment advisor expenses                            51,638             175,000
Other operating expenses                              766,596             613,514

Total expenses, before waiver of profit-sharing bonus 10,835,931 12,097,442 Waiver of profit-sharing bonus

                                        -               

Total expenses, net of incentive bonus waiver $10,835,931 $12,097,442


Total expenses, net of incentive fee waiver, decreased $1.3 million, or 10.4%,
for the six months ended June 30, 2022 from the comparable period in 2021,
primarily due to the reversal of previously accrued incentive fees on capital
gains, as required by GAAP during the six months ended June 30, 2022, which was
partially offset by an increase in management fees period over period.

The Company is required under GAAP to accrue a hypothetical liquidation basis
incentive fee on capital gains, based upon net realized capital gains and
unrealized capital appreciation and depreciation on investments held at the end
of each period. If the resulting calculation amount is negative, the accrual for
GAAP in a given period may result in the reduction or reversal of Incentive Fees
on capital gains accrued in a prior period (see Note 3 to the consolidated
financial statements). The accrual (reversal) of Incentive Fees on capital gains
was approximately $(1.5) million and zero during the six months ended June 30,
2022 and 2021, respectively. As of June 30, 2022 and December 31, 2021, the
balance of accrued Incentive Fees on capital gains was zero and $1.5 million,
respectively. However, as of December 31, 2021 no Incentive Fees on capital
gains were realized and payable to the Advisor as of such date.

For the six months ended June 30, 2022and 2021, the Company has committed $0.1 million and zero, respectively, revenue-based incentive commissions.

Management fees increased approximately $0.4 million, or 12.1%, for the six
months ended June 30, 2022 from the comparable period in 2021 due to an increase
in the total assets on which management fees are calculated (in arrears). The
increase in total assets was primarily due to net deployments during 2021.

Net investment income

Net investment income was $13.6 million and $9.0 million for the six months ended June 30, 2022 and 2021, respectively. The increase of about $4.6 millioni.e. 50.7%, was due to a $3.3 million increase in total investment income, combined with a $1.3 million decrease in expenses described above.

Net realized gain or loss

Net realized gain (loss) for the six months ended June 30, 2022 was
approximately $0.8 million, primarily due to escrow proceeds received from SVP -
Singer Holdings, LP, which was exited during 2021. Net realized gain (loss) for
the six months ended June 30, 2021 was $(19.7) million, primarily due to the
restructure of Advanced Lighting Technologies, LLC, and exits of our investments
in Red Apple Stores Inc., First Boston Construction Holdings, LLC, and Advantage
Insurance Inc. Substantially all of the net realized losses were reflected in
unrealized depreciation in prior periods.

Net unrealized gain or loss

For the six months ended June 30, 2022 and 2021, the change in net unrealized
appreciation or depreciation on our investments, Interest Rate Swap, and foreign
currency translation was an increase in net unrealized depreciation of $(11.5)
million and a decrease in net unrealized depreciation of $58.9 million,
respectively. The increase in net unrealized depreciation for the six months
ended June 30, 2022 was primarily due to i) an overall increase in valuation
depreciation across our portfolio due to spread widening and general market
declines during the period (see Item 1A. Risk Factors), out of which our
investments in Zest Acquisition Corp., Stitch Holdings L.P., Thras.io, LLC, and
Magenta Buyer, LLC contributed to $(3.3) million of that decrease; ii) a $(1.6)
million increase in valuation depreciation in our investment in Juul Labs Inc.;
partially offset by iii) a $0.9 million decrease in unrealized depreciation in
Gordon Brothers Finance Company, including the reversal of $2.0 million of
previously recognized depreciation as a result of a paydown during the period
and $(1.1) million of valuation depreciation during the period. The decrease in
net unrealized depreciation for the six months ended June 30, 2021 was primarily
due to i) a $27.4 million decrease in net unrealized depreciation on SVP-Singer
Holdings, LP, including the reversal of previously recognized depreciation of
$1.5 million

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associated with a distribution from the portfolio company and $25.9 million of
valuation appreciation, based on expected proceeds on the sale of the portfolio
company which successfully closed in July 2021; ii) the reversal of previously
recognized depreciation of $19.3 million, including foreign currency
translation, related to the exits of our investments in Red Apple Stores Inc.,
First Boston Construction Holdings, LLC and Advantage Insurance Inc., and the
restructure of Advanced Lighting Technologies, LLC; and iii) overall increase in
valuation appreciation across our portfolio.

Net increase or decrease in net assets resulting from operations

The net increase or (decrease) in net assets resulting from operations for the
six months ended June 30, 2022 and 2021 was $3.0 million and $48.2 million,
respectively. As compared to the prior period, the decrease is reflective of net
realized and unrealized gain (loss) of $(10.6) million for the current period,
as compared to $39.2 million of net realized and unrealized gain (loss) for the
six months ended June 30, 2021, the impact of which was partially offset by an
increase in net investment income of approximately $4.6 million
period-over-period.

Additional 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.

After March 6, 2017, Incentive Fees based on income are calculated for each
calendar quarter and may be paid on a quarterly basis if certain thresholds are
met. In addition, as previously disclosed, the Advisor, in consultation with the
Company's Board of Directors, had agreed to waive Incentive Fees based on income
from March 7, 2017 to June 30, 2019. BCIA had agreed to honor such waiver. The
Advisor had voluntarily waived a portion of its Incentive Fees based on income
from July 1, 2019 through September 30, 2021.

We record our liability for Incentive Fee based on capital gains by performing a
hypothetical liquidation basis calculation at the end of each reporting period,
as required by GAAP, which assumes that all unrealized capital appreciation and
depreciation is realized as of the reporting date. It should be noted that
Incentive Fees based on capital gains (if any) are not due and payable until the
end of the annual measurement period, or every June 30. The incremental
Incentive Fee disclosed for a given period is not necessarily indicative of
actual full year 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. There can be no
assurance that unrealized capital appreciation and depreciation will be realized
in the future, or that any accrued capital gains Incentive Fee will become
payable. Incentive Fee amounts on capital gains actually paid by the Company
will specifically exclude consideration of unrealized capital appreciation,
consistent with requirements under the Advisers Act and the Current Management
Agreement. See Note 3 to the consolidated financial statements for a more
detailed description of the Company's Incentive Fee.

Calculations for all periods are taken from our consolidated financial statements as follows:

                                             Three Months Ended                       Six Months Ended
                                      June 30, 2022       June 30, 2021       June 30, 2022       June 30, 2021
GAAP Basis:
Net Investment Income                $     7,120,216     $     4,842,724     $    13,615,311     $     9,032,941
Net Investment Income per share                 0.10                0.07                0.18                0.12
Addback: GAAP incentive fee
(reversal) based on capital gains         (1,073,068 )                 -          (1,544,569 )                 -
Addback: GAAP incentive fee based
on Income net of incentive fee
waiver (if any)                               69,343                   -              88,356                   -
Pre-Incentive Fee1:
Net Investment Income                $     6,116,491     $     4,842,724     $    12,159,098     $     9,032,941
Net Investment Income per share                 0.08                0.07                0.16                0.12
Less: Incremental incentive fee              (69,343 )                 -             (88,356 )                 -
based on Income net of incentive
fee waiver (if any)
As Adjusted2:
Net Investment Income                $     6,047,148     $     4,842,724     $    12,070,742     $     9,032,941
Net Investment Income per share                 0.08                0.07                0.16                0.12



Pre-incentive fee1: Amounts are adjusted to remove all inducement fees. These costs have been recorded (cancelled) but are not due and payable at the closing date.

As Adjusted2: Amounts are adjusted to remove the GAAP accrual (reversal) for
incentive fee based on capital gains, and to include only the incremental
incentive fee based on income. Adjusted amounts reflect the fact that no
Incentive Fee on capital gains was realized and payable to the Advisor during
the three and six month periods ended June 30, 2022 and 2021, respectively (see
Note 3). Under the Current Management Agreement, incentive fee based on income
is calculated for each calendar quarter and may be paid on a quarterly basis if
certain thresholds are met. Amounts reflected the Company's ongoing operating
results and reflect the Company's financial performance over time.

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Financial position, liquidity and capital resources

During the six months ended June 30, 2022, we generated operating cash flows
primarily from interest and fees received on senior secured loans and other debt
securities, as well as from sales of selected portfolio company investments or
repayments of principal. Net cash used in operating activities for the six
months ended June 30, 2022 was $(13.1) million. Our use of cash from operating
activities during the period primarily consisted of $(13.1) million in net
purchases of investments, excluding PIK capitalization.

Net cash provided by financing activities during the six months ended June 30,
2022 was $22.7 million. Our sources of cash from financing activities consisted
of $92.0 million from the issuance of our 2025 Private Placement Notes, and
$92.0 million in net debt borrowings under the Credit Facility. Our uses of cash
consisted of the $(143.7) million repayment of our 2022 Convertible Notes, cash
distributions paid to stockholders of $(14.8) million, purchases of treasury
stock of $(2.0) million, and payments of debt issuance costs of $(0.8) million.

In the normal course of business, we may enter into guarantees on behalf of
portfolio companies. Under these arrangements, we would be required to make
payments to third parties if the portfolio companies were to default on their
related payment obligations. There were no such guarantees outstanding at June
30, 2022 and December 31, 2021. In addition, from time to time, the Company may
provide for a commitment to a portfolio company for investment in an existing or
new security. At June 30, 2022 and December 31, 2021, we were obligated to
existing portfolio companies for unfunded commitments of $69.5 million across 38
portfolio companies and $49.4 million across 35 portfolio companies,
respectively.

As of June 30, 2022, we have analyzed cash and cash equivalents and availability
under our Credit Facility and believe that there is sufficient liquidity to meet
all of our obligations, fund unfunded commitments should the need arise, and
deploy capital into new and existing portfolio companies.

Contractual obligations

A summary of our principal contractual payment obligations for the repayment of outstanding borrowings to June 30, 2022 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)

                    $     146.0       $                -       $     146.0     $         -     $             -
2025 Private Placement Notes                 92.0                        -                 -            92.0                   -
Interest and Debt Related Payables            0.7                      0.7                 -               -                   -




(1)

To June 30, 2022, $119.0 million have not been drawn under our credit facility.

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 June 2020:

 Distribution Amount
      Per Share
     Outstanding             Record Date          Payment Date
$                0.10        June 1, 2020         July 7, 2020
$                0.10      August 18, 2020     September 29, 2020
$                0.10     November 18, 2020    December 30, 2020
$                0.10       March 17, 2021       April 7, 2021
$                0.10       June 16, 2021         July 7, 2021
$                0.10     September 15, 2021    October 6, 2021
$                0.10     December 16, 2021     January 6, 2022
$                0.10       March 17, 2022       April 7, 2022
$                0.10       June 16, 2022         July 7, 2022
$                0.10     September 15, 2022    October 6, 2022

The tax characteristics of all distributions are disclosed to shareholders on Form 1099-DIV or Form 1042-S after the end of the calendar year.

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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. 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 (excluding capital gains or losses) for the calendar year;

98.2% of the amount by which our capital gains exceed our capital losses (adjusted for certain ordinary losses) for the one-year period generally ending on October 31 of the calendar year; and

certain undistributed amounts from prior years on which we have not paid any WE
federal income tax.

We may, at our discretion, carry forward taxable income in excess of calendar
year distributions and pay a 4% excise tax on this income. If we choose to do
so, all other things being equal, this would increase expenses and reduce the
amounts available to be distributed to our stockholders. We will accrue excise
tax on estimated taxable income as required. In addition, although we currently
intend to distribute realized net capital gains (i.e., net long-term capital
gains in excess of short-term capital losses), if any, at least annually, out of
the assets legally available for such distributions, we may in the future decide
to retain such capital gains for investment. There was no provision for federal
excise taxes recorded for the year ended December 31, 2021.

The final tax characterization of distributions is determined after the fiscal
year and is reported on Form 1099 and in the Company's annual report to
stockholders. Distributions can be characterized as ordinary income, capital
gains and/or return of capital. To the extent that distributions exceed the
Company's current and accumulated earnings and profits, the excess may be
treated as a non-taxable return of capital. Distributions that exceed a
Company's taxable income but do not exceed the Company's current and accumulated
earnings and profits, may be classified as ordinary income which is taxable to
stockholders.

The Company estimates the source of its distributions as required by Section
19(a) of the 1940 Act. On a quarterly basis, for any payment of dividends
estimated to be paid from any other source other than net investment income
accrued for current period or certain cumulative periods based on the Section
19(a) requirement, the Company posts a Section 19(a) notice through the
Depository Trust Company's Legal Notice System and its website, as well as sends
its registered stockholders a printed copy of such notice along with the
dividend payment. The estimates of the source of the distribution are interim
estimates based on GAAP that are subject to revision, and the exact character of
the distributions for tax purposes cannot be determined until the final books
and records are finalized for the calendar year. Therefore, these estimates are
made solely in order to comply with the requirements of Section 19(a) of the
1940 Act and should not be relied upon for tax reporting or any other purposes
and could differ significantly from the actual character of distributions for
tax purposes. For the $0.10 dividend per share paid on July 7, 2022, the Company
estimates that approximately $0.097 was from net investment income and
approximately $0.003 was estimated to be a return of capital. For Consolidated
Statements of Changes in Net Assets, sources of distribution to stockholders
will be adjusted on an annual basis, if necessary, and calculated in accordance
with federal income tax regulations.

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 as to receive cash distributions. Additionally, if the Company
makes a distribution to be paid in cash or in stock at the election of
stockholders as of the applicable dividend record date (a "Cash/Stock
Distribution"), the terms are subject to the amended Plan dated May 13, 2020
described below (see Note 7 to the consolidated financial statements).

On March 6, 2018, the Board of Directors of the Company adopted amendments to
the Company's dividend reinvestment plan (the "Plan"). Under the terms of the
amended Plan, if the Company declares a dividend or determines to make a capital
gain or other distribution, the reinvestment plan agent will acquire shares for
the participants' accounts, depending upon the following circumstances, (i)
through receipt of additional unissued but authorized shares from the Company
("newly issued shares") and/or (ii) by purchase of outstanding shares on the
open market ("open-market purchases"). If, on the distribution payment date, the
last quarterly net asset value per share ("NAV") is equal to or less than the
closing market price per share on such distribution payment date (such condition
often referred to as a "market premium"), the reinvestment plan agent will
invest the distribution amount in newly issued shares on behalf of the
participants. The number of newly issued shares to be credited to each
participant's account will be determined by dividing the dollar amount of the
distribution by the greater of (i) the NAV or (ii) 95% of the closing market
price on the distribution payment date. If, on the distribution payment date,
the NAV is greater than the closing market price per share on such distribution
payment date (such condition often referred to as a "market discount"), the
reinvestment plan agent may, upon notice from the Company, either (a) invest the
distribution amount in newly issued shares on behalf of the participants or (b)
invest the distribution amount in shares acquired on behalf of the participants
in open-market purchases.

On May 13, 2020, the Board of Directors of the Company adopted further
amendments to the Plan. Under the terms of the amended Plan, if the Company
makes a Cash/Stock Distribution, each stockholder will be required to elect
whether to receive the distribution in cash or in shares of the Company's common
stock ("Common Shares"), pursuant to such notices, forms or other documentation
as may be provided to the stockholder by the Company (the "Election Forms"). If
the stockholder is a Plan participant and elects to receive the Cash/Stock
Distribution in cash, the stockholder will be deemed to have elected not to
participate in the Plan solely with respect to such Cash/Stock Distribution and
will receive the distribution in cash subject to any rules applicable to the
distribution that may limit the portion of the distribution the Company is
required to pay in cash. If the stockholder is a Plan participant and elects to
receive the Cash/Stock Distribution in stock, the stockholder will receive the
distribution in newly issued Common Shares. The number of newly issued Common
Shares credited to the stockholders' account in either case will be determined
by dividing the dollar amount of the distribution (or portion of the
distribution to be paid in Common Shares) by

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the price per Common Share determined in accordance with the Election Forms
rather than pursuant to the formula(s) otherwise applicable under the Plan. This
feature of the Plan means that, under certain circumstances, we may issue shares
of our common stock at a price below NAV 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. GAAP 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 accretion 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 income or excise
taxes. In order to satisfy the annual distribution requirement applicable to
RICs, we may 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 sufficient portion of such
dividend is paid in cash and certain requirements are met, the entire
distribution would generally be treated as a dividend for U.S. federal income
tax purposes.

Recent developments

On August 2, 2022, the Company's Board of Directors declared a distribution of
$0.10 per share, payable on October 6, 2022 to stockholders of record at the
close of business on September 15, 2022.

On August 2, 2022, pursuant to Rule 2a-5 under the 1940 Act, the Board of
Directors designated the Advisor as the Valuation Designee to perform certain
fair value functions, including performing fair value determinations for the
Company.

The Company has reviewed subsequent events occurring through the date that these
consolidated financial statements were available to be issued, and determined
that no subsequent events occurred requiring accrual or disclosure, except as
disclosed above and elsewhere in these notes to consolidated financial
statements.

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.

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