Nik Singhal

212.810.5427

GAAP net investment income of $0.24 per share, or $0.22 per share excluding an insurance reimbursement payment related to a previously announced legal settlement, providing fourth quarter distribution coverage of 112% and 105%, respectively.

NAV declined 2.0% to $8.21 per share during the quarter, primarily resulting from net unrealized depreciation on legacy assets

Net leverage and total liquidity relatively unchanged quarter-over-quarter, at 0.55x and $261 million, respectively

Non-accrual rate declined from 11.1% to 5.4% of our debt investments at amortized cost or from 4.0% to 0.7% at fair market value

($’s in millions, except per share data)

Net Investment Income/(loss)

Net realized and unrealized gains/(losses)

Basic earnings/(loss) per share

Distributions declared

Net Investment Income/(loss), as adjusted¹

Basic earnings/(loss) per share, as adjusted¹

($’s in millions, except per share data)

Net Investment Income/(loss)

Net realized and unrealized gains/(losses)

Basic earnings/(loss) per share

Distributions declared

Net Investment Income/(loss), as adjusted¹

Basic earnings/(loss) per share, as adjusted¹

($’s in millions, except per share data)

Total assets

Investment portfolio, at fair market value

Debt outstanding

Total net assets

Net asset value per share

Net leverage ratio²

Vertellus, which filed its U.S. operations for Chapter 11 bankruptcy protection on May 31, 2016, emerged from bankruptcy on October 31, 2016. Post-emergence, we own 12.1% of the common equity in addition to cash paying restructured 1^st and 2^nd lien debt securities.

Senior Loan Partners, our joint venture with Windward Investments LLC, made investments into three new portfolio companies during the quarter, bringing committed and outstanding amounts to $55.2 million and $53.7 million, respectively. The three new investments at par are (i) a $9.0 million first lien term loan to Dunn Paper, Inc., a manufacturer and provider of high-performance paper materials in the lightweight food packaging segment, (ii) a $10.0 million first lien term loan to O2 Partners, LLC, a producer of open-cell foam insoles for leading shoe brands and (iii) a $10.0 million first lien term loan to Digital Room LLC, an e-commerce focused B2B printer of a variety of marketing related products.

Non-GAAP basis financial measure. See Supplemental Information on page 8.

Calculated less available cash and receivable for investments sold, plus payable for investments purchased, unamortized debt issuance costs and legal settlement payable, if any.

During the quarter, we received a $1.1 million, or $0.02 per share, insurance reimbursement payment connected to our previously disclosed legal settlement relating to the AL Solutions matter.

For the year ended December 31, 2016, we repurchased a total of 1.9 million shares of our common stock on the open market for $16.1 million, including brokerage commissions, at an average price of $8.45 per share. There were no share repurchases during the fourth quarter. Since the inception of our share repurchase program through December 31, 2016, we have purchased 4.6 million shares at an average price of $7.98 per share, including brokerage commissions, for a total of $36.3 million. The cumulative repurchases since BlackRock entered into the investment management agreement with the Company totaled approximately 2.8 million shares for $24.0 million, representing 66% of total share repurchase activity, on a dollar basis, since inception. As of December 31, 2016, the Company had approximately 1.2 million additional shares authorized for repurchase.

Commitments

Investment exits

Number of portfolio company investments at the end of period

Weighted average yield of debt and income producing equity securities, at fair market value

% of Portfolio invested in Secured debt, at fair market value

% of Portfolio invested in Unsecured debt, at fair market value

% of Portfolio invested in Equity, at fair market value

Average investment by portfolio company, at amortized cost (excluding investments below $5.0 million)

We invested $107.8 million during the quarter, while sales, repayments and other exits of investments totaled $109.2 million, resulting in a $1.4 million net decrease in our portfolio due to investment activity. Excluding the impact of the Vertellus restructuring, commitments and exits were $58.3 million and $59.7 million, respectively. Nearly 70% of our deployments during the quarter were represented by two portfolio companies: (i) $20.0 million of L + 1,000 second lien debt to Paragon Films, Inc. and (ii) $20.2 million of incremental equity to Senior Loan Partners. Approximately 90% of our proceeds from exits during the quarter were also represented by two transactions: (i) a repayment at par of our $35.1 million investment in BPA Laboratories Inc. and (ii) a $20.0 million reduction in our position in Sur La Table, Inc.

Our non-accrual rate further improved compared to the prior three quarters as a result of the aforementioned Vertellus restructuring. As of December 31, 2016, our non-accruals were 0.7% of our total debt investments at fair market value, and 5.4% at amortized cost, compared with 4.0% and 11.1%, respectively, as of the prior quarter-end. Our average internal investment rating at fair market value at year-end was 1.35 as compared to 1.40 as of the prior quarter end.

The portion of our portfolio invested in equity securities increased during the quarter to 17% at year end, primarily due to the deployment of $20.2 million of equity capital into Senior Loan Partners. Our portfolio composition of secured debt, at fair market value, decreased to 66% at year end, primarily resulting from the repayment of BPA Laboratories, Inc. during the quarter. Unsecured debt increased to 17% due to net depreciation in our total portfolio resulting in a smaller overall portfolio at fair market value. Total portfolio yield increased 30 basis points sequentially from 11.4% as of last quarter-end to 11.7%, largely a result of the Vertellus restructuring removing the investment from non-accrual status.

Net unrealized depreciation decreased $12.5 million during the current quarter, bringing total balance sheet unrealized depreciation to $92.3 million. During the period, gross unrealized depreciation of $17.2 million primarily from legacy assets was partially offset by $3.2 million of gross unrealized appreciation. Further, there was $26.4 million of unrealized appreciation during the quarter due primarily to the reversal of previously recognized unrealized depreciation on the Vertellus restructuring.

Fee income earned on capital structuring, prepayments, commitment, administration and amendments during the current quarter totaled $2.6 million, as compared to $0.5 million earned during the preceding quarter, and $1.5 million earned during the prior year quarter. Current quarter investment income also includes a $1.1 million insurance reimbursement received in connection with the previously disclosed AL Solutions legal settlement during the quarter. Excluding fee income and the insurance reimbursement, investment income decreased approximately 5% compared to the prior quarter, and 20% as compared to this quarter one year ago. The decreases were a result of a net reduction in overall income producing assets over the year, as well as certain investments on non-accrual status through the course of 2016.

Both GAAP net investment income (“NII”), and NII, as adjusted, were $17.1 million, or $0.24 per share, and $54.0 million, or $0.74 per share, respectively, for the three months and year ended December 31, 2016. Relative to 2016 distributions declared of $0.84 per share, our GAAP NII distribution coverage was 89% for the year, and 115% excluding the $16.4 million net expense resulting from the previously disclosed legal settlement, net of the current quarter insurance reimbursement.

During the quarter, there was no accrual for incentive management fees based on gains due largely to the net unrealized depreciation in the portfolio as of December 31, 2016. A hypothetical liquidation is performed each quarter end resulting in an additional accrual if the amount is positive or a reversal to the existing accrual if the amount is negative. However, the resulting fee accrual is not due and payable until June 30, if at all. There is currently no balance accrued for incentive management fees based on gains as of the measurement period ending December 31, 2016. Furthermore, no incentive management fees based on income were earned and payable for the quarter, as the distributable income amount was reduced below the hurdle by the net realized and unrealized losses in the portfolio for the trailing four quarter period. As a result, there were no pro-forma incentive management fees based on income for the quarter causing our NII, as adjusted, to equal our GAAP NII of $0.24 per share. We estimate that the waiver of the incentive management fees based on income will add approximately $0.03-$0.04 per share per quarter to NII based on the current earnings run-rate of the Company.

Our 2016 weighted average cost of debt decreased 141 basis points to 4.37%, as compared to 2015. This was primarily driven by (i) refinancing our $158 million 6.5% senior secured notes with proceeds from our revolving credit facility and (ii) the subsequent lowering of the interest rate margin on the credit facility pursuant to the amendment and restatement earlier in the year. Our 2016 borrowing costs, on a dollar basis, are more than 30% lower than the prior year, and we realized an annual savings in financing costs of $0.10 per share.

Tax characteristics of all 2016 distributions were reported to stockholders on Form 1099 after the end of the calendar year. Our 2016 tax distributions of $0.73 per share were comprised of ordinary income. Our return of capital distributions since inception totaled $1.96 per share. At our discretion, we may carry forward taxable income in excess of calendar year distributions and pay a 4% excise tax on this income. We will accrue excise tax on estimated undistributed taxable income as required. There was no undistributed taxable income carried forward from 2016. For more information on our GAAP distributions, please refer to the Section 19 Notice that may be posted within the Distribution History section of our website.

At December 31, 2016, we had total liquidity of $260.7 million, consisting of $10.7 million in cash and cash equivalents and $250.0 million of availability under our credit facility, subject to leverage and borrowing base restrictions. The credit facility was amended and extended during the first quarter of 2016 to a February 2021 maturity.

Our net leverage, adjusted for available cash, receivables for investments sold, payables for investments purchased and unamortized debt issuance, stood at 0.55x at year-end, and our 275% asset coverage ratio provided the Company with available debt capacity under its asset coverage requirements of $256.3 million. Further, as of quarter-end, 86% of our portfolio was invested in qualifying assets, exceeding the 70% regulatory requirement of a business development company.

BlackRock Capital Investment Corporation will host a webcast/teleconference at 10:00 a.m. (Eastern Time) on Thursday, March 9, 2017, to discuss its fourth quarter 2016 financial results. All interested parties are welcome to participate. You can access the teleconference by dialing, from the United States, (888) 710-3981, or from outside the United States, (913) 312-0934, shortly before 10:00 a.m. and referencing the BlackRock Capital Investment Corporation Conference Call (ID Number 3210745). A live, listen-only webcast will also be available via the investor relations section of www.blackrockbkcc.com. Both the teleconference and webcast will be available for replay by 1:00 p.m. on Thursday, March 9, 2017 and ending at 1:00 p.m. on Thursday, March 23, 2017. To access the replay of the teleconference, callers from the United States should dial (888) 203-1112 and callers from outside the United States should dial (719) 457-0820 and enter the Conference ID Number 3210745.

Prior to the webcast/teleconference, an investor presentation that complements the earnings conference call will be posted to BlackRock Capital Investment Corporation’s website within the presentations section of the investor relations page (http://www.blackrockbkcc.com/InvestorRelations/Presentations/index.htm).

Assets

Investments at fair value:

Non-controlled, non-affiliated investments (cost of $586,176,755 and $876,732,386)

Non-controlled, affiliated investments (cost of $112,640,458 and $62,003,676)

Controlled investments (cost of $322,768,014 and $214,393,103)

Total investments at fair value (cost of $1,021,585,227 and $1,153,129,165)

Cash and cash equivalents

Receivable for investments sold

Interest and fees receivable

Prepaid expenses and other assets

Total Assets

Liabilities

Debt

Interest payable

Distributions payable

Base management fees payable

Accrued administrative services

Other accrued expenses and payables

Total Liabilities

Net Assets

Common stock, par value $.001 per share, 200,000,000 common shares authorized, 77,228,207 and 76,747,083 issued and 72,676,242 and 74,099,182 outstanding

Paid-in capital in excess of par

Undistributed / (Distributions in excess of) net investment income

Accumulated net realized loss

Net unrealized (depreciation)

Treasury stock at cost, 4,551,965 and 2,647,901 shares held

Total Net Assets

Total Liabilities and Net Assets

Net Asset Value Per Share

BlackRock Capital Investment Corporation

Consolidated Statements of Operations (Unaudited)

Investment Income:

Interest income:

Non-controlled, non-affiliated investments

Non-controlled, affiliated investments

Controlled investments

Total interest income

Fee income:

Non-controlled, non-affiliated investments: prepayment fees

Non-controlled, non-affiliated investments: capital structuring fees

Non-controlled, non-affiliated investments: other

Controlled investments

Total fee income

Dividend income:

Non-controlled, non-affiliated investments

Non-controlled, affiliated investments

Controlled investments

Total dividend income

Other income

Total investment income

Expenses:

Base management fees

Legal settlement

Incentive management fees

Interest and credit facility fees

Professional fees

Administrative services

Director fees

Investment advisor expenses

Other

Total expenses

Net Investment Income

Realized and Unrealized Gain (Loss):

Net realized gain (loss):

Non-controlled, non-affiliated investments

Non-controlled, affiliated investments

Controlled investments

Net realized gain (loss)

Net change in unrealized appreciation (depreciation) on:

Non-controlled, non-affiliated investments

Non-controlled, affiliated investments

Controlled investments

Foreign currency translation

Net change in unrealized appreciation (depreciation)

Net realized and unrealized gain (loss)

Net Increase (Decrease) in Net Assets Resulting from Operations

Net Investment Income (Loss) Per Share

Basic

Diluted

Earnings (Loss) Per Share

Basic

Diluted

Average Shares Outstanding

Basic

Diluted

Distributions Declared Per Share

GAAP Basis:

Net Investment Income/(Loss)

Net Investment Income/(Loss) per share

Addback: GAAP incentive management fee expense based on Gains

Addback: GAAP incentive management fee expense based on Income

Pre-Incentive Fee¹:

Net Investment Income/(Loss)

Net Investment Income/(Loss) per share

Less: Incremental incentive management fee expense based on Income

As Adjusted²:

Net Investment Income/(Loss)

Net Investment Income/(Loss) per share

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

As Adjusted: 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 calculated based on the current quarter’s incremental earnings, and without any reduction for incentive management fees paid during the prior calendar quarters. Amounts reflect the Company’s ongoing operating results and reflect the Company’s financial performance over time.