September 6, 2011

Investment Company Weekly

Over this past week, BDCs as a group dropped 1.85% in price versus a 0.3% gain in the SNL REIT Index and a 0.24% decline in the S&P 500. Over the last twelve months, BDCs as a group have had a total return of 6.7% in comparison to a return of 9.9% and 8.8% in the S&P 500 and the SNL REIT Index respectively. Stocks of the SNL Investment Company group were down 1.81% in the past week; the dividend yield stands at 13.1% from the previous weekly reading of 12.9% The MK BDC Index mean dividend yield is currently 9.6% (10.6% for dividend paying BDCs), vs. 9.4% (10.4% for dividend paying BDCs) from last week and the 8.3% yield of a year ago; The spread between mean BDC dividend yields and 5-yr treasuries is now 7.84%; The current yield spread is 64% higher than the long-term median of 4.79% (vs. 5-yr treasury); Relative to the comparable corporate bond, the Baa 5-yr Industrial spread is currently 183 bps (versus 166 bps last week) compared to the historical median spread of 153 bps since 2001; Baa Bank spread multiple is currently higher (about 1.9 times the historical median) due to higher perceived risk in the banking sector Headlines from last week in the Morgan Keegan BDC coverage universe: Prospect Capital (PSEC M/S) reported earnings, increased total commitments to the credit facility by $25 million to $400 million, and filed a $750 million shelf registration; and Triangle Capital (TCAP O/S) declared a quarterly cash dividend of $0.44/share. Specialty Finance
Robert Dodd, PhD
901.579.4560 robert.dodd @morgankeegan.com

Robert Ladyman
901.531.3331 bo.ladyman @morgankeegan.com

Dixon Braden
901.579.4511 dixon.braden @morgankeegan.com

Morgan Keegan & Co., Inc. does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.

Please see Disclosure and Certification Statement beginning on page 14 of this report.
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Morgan Keegan & Co., Inc.

Specialty Finance

Investment Company Weekly Update Robert J. Dodd, Ph.D. Robert.Dodd@MorganKeegan.com 901-579-4560 Bo Ladyman Bo.Ladyman@MorganKeegan.com 901-531-3331 Dixon Braden Dixon.Braden@MorganKeegan.com 901-579-4511

Tuesday, September 06, 2011

Compass Diversified Holdings Fifth Street Finance Corp. Fidus Investment Corporation Horizon Technology Finance Corp. Main Street Capital Prospect Capital Corporation Triangle Capital Corporation Morgan Keegan Rated Companies: CODI PT = $19.00 Outperform FSC PT = $10.50 Outperform FDUS PT = $16.00 Outperform HRZN PT = $18.50 Outperform MAIN PT = $19.50 Outperform PSEC PT = $8.25 Marketperfom TCAP PT = $20.00 Outperform Speculative Speculative Speculative Speculative Speculative Speculative Market Risk

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Morgan Keegan & Co., Inc.

Specialty Finance

Summary Tables For All BDC's / Investment Companies

Dividend Yield American Capital Strategies, Limited Apollo Investment Corporation Ares Capital Corporation Blackrock Kelso Capital Corp. Compass Diversified Holdings Fifth Street Finance Corp. Gladstone Capital Corporation Gladstone Investment Corporation Harris & Harris Group, Inc. Hercules Technology Growth Capital, Inc. Horizon Technology Finance Corp. Kayne Anderson Energy Development Company Kohlberg Capital Corporation Main Street Capital Corporation MCG Capital Corporation MVC Capital, Inc. NGP Capital Resources Co. PennantPark Investment Corporation Prospect Capital Corporation TICC Capital Corp. Tortoise Capital Resources Corp. Triangle Capital Corporation Mean Median High Low 0.0% 13.1% 9.7% 12.6% 11.3% 13.7% 11.1% 9.3% 0.0% 9.9% 10.4% 7.6% 11.1% 9.0% 15.7% 4.5% 10.8% 11.2% 14.7% 11.2% 4.9% 10.3% 9.6% 10.6% 15.7% 0.0% Tax- Adjusted Dividend Yield American Capital Strategies, Limited Apollo Investment Corporation Ares Capital Corporation Blackrock Kelso Capital Corp. Compass Diversified Holdings Fifth Street Finance Corp. Gladstone Capital Corporation Gladstone Investment Corporation Harris & Harris Group, Inc. Hercules Technology Growth Capital, Inc. Horizon Technology Finance Corp. Kayne Anderson Energy Development Company Kohlberg Capital Corporation Main Street Capital Corporation MCG Capital Corporation MVC Capital, Inc. NGP Capital Resources Co. PennantPark Investment Corporation Prospect Capital Corporation TICC Capital Corp. Tortoise Capital Resources Corp. Triangle Capital Corporation Mean Median High Low 0.0% 8.7% 6.3% 8.2% 9.6% 8.9% 7.2% 6.1% 0.0% 6.5% 6.7% 6.5% 7.2% 6.2% 10.7% 3.1% 7.0% 7.3% 10.6% 7.3% 4.1% 7.4% 6.6% 7.1% 10.7% 0.0% Dividend Payout Ratio American Capital Strategies, Limited Apollo Investment Corporation Ares Capital Corporation Blackrock Kelso Capital Corp. Compass Diversified Holdings Fifth Street Finance Corp. Gladstone Capital Corporation Gladstone Investment Corporation Harris & Harris Group, Inc. Hercules Technology Growth Capital, Inc. Horizon Technology Finance Corp. Kayne Anderson Energy Development Company Kohlberg Capital Corporation Main Street Capital Corporation MCG Capital Corporation MVC Capital, Inc. NGP Capital Resources Co. PennantPark Investment Corporation Prospect Capital Corporation TICC Capital Corp. Tortoise Capital Resources Corp. Triangle Capital Corporation Mean Median High Low NMF 113% 103% 114% 84% 124% 97% 78% NMF 95% 107% 94% 100% 105% 119% 800% 94% 89% 107% 103% 49% 91% 133% 101% 800% 49% Price / NAV American Capital Strategies, Limited Apollo Investment Corporation Ares Capital Corporation Blackrock Kelso Capital Corp. Compass Diversified Holdings Fifth Street Finance Corp. Gladstone Capital Corporation Gladstone Investment Corporation Harris & Harris Group, Inc. Hercules Technology Growth Capital, Inc. Horizon Technology Finance Corp. Kayne Anderson Energy Development Company Kohlberg Capital Corporation Main Street Capital Corporation MCG Capital Corporation MVC Capital, Inc. NGP Capital Resources Co. PennantPark Investment Corporation Prospect Capital Corporation TICC Capital Corp. Tortoise Capital Resources Corp. Triangle Capital Corporation Mean Median High Low 0.61 0.87 0.94 0.84 0.00 0.87 0.74 0.71 0.73 0.92 0.89 0.87 0.71 1.26 0.63 0.62 0.69 0.87 0.80 0.91 0.77 1.24 0.79 0.82 1.26 0.00

Debt/Equity (Most Recent Quarter) American Capital Strategies, Limited Apollo Investment Corporation Ares Capital Corporation Blackrock Kelso Capital Corp. Compass Diversified Holdings Fifth Street Finance Corp. Gladstone Capital Corporation Gladstone Investment Corporation Harris & Harris Group, Inc. Hercules Technology Growth Capital, Inc. Horizon Technology Finance Corp. Kayne Anderson Energy Development Company Kohlberg Capital Corporation Main Street Capital Corporation (3) MCG Capital Corporation MVC Capital, Inc. NGP Capital Resources Co. PennantPark Investment Corporation Prospect Capital Corporation TICC Capital Corp. Tortoise Capital Resources Corp. Triangle Capital Corporation (3) Mean Median High Low

36% 65% 52% 38% 19% 39% 43% 20% 2% 61% 56% 28% 31% 78% 96% 12% 34% 46% 36% 0% 0% 87% 40% 37% 96% 0%

Market Capitalization ($MM) American Capital Strategies, Limited Apollo Investment Corporation Ares Capital Corporation Blackrock Kelso Capital Corp. Compass Diversified Holdings Fifth Street Finance Corp. Gladstone Capital Corporation Gladstone Investment Corporation Harris & Harris Group, Inc. Hercules Technology Growth Capital, Inc. Horizon Technology Finance Corp. Kayne Anderson Energy Development Company Kohlberg Capital Corporation Main Street Capital Corporation MCG Capital Corporation MVC Capital, Inc. NGP Capital Resources Co. PennantPark Investment Corporation Prospect Capital Corporation TICC Capital Corp. Tortoise Capital Resources Corp. Triangle Capital Corporation Mean Median High Low

2,838 1,673 2,954 606 593 675 160 142 122 388 118 206 138 417 334 257 144 441 902 292 75 386 630 360 2,954 75

% Change From Previous Week American Capital Strategies, Limited Apollo Investment Corporation Ares Capital Corporation Blackrock Kelso Capital Corp. Compass Diversified Holdings Fifth Street Finance Corp. Gladstone Capital Corporation Gladstone Investment Corporation Harris & Harris Group, Inc. Hercules Technology Growth Capital, Inc. Horizon Technology Finance Corp. Kayne Anderson Energy Development Company Kohlberg Capital Corporation Main Street Capital Corporation MCG Capital Corporation MVC Capital, Inc. NGP Capital Resources Co. PennantPark Investment Corporation Prospect Capital Corporation TICC Capital Corp. Tortoise Capital Resources Corp. Triangle Capital Corporation Mean Median High Low

-1.6% 0.6% -1.0% -1.2% -2.0% -2.7% -4.2% -3.2% -4.4% -1.0% -1.0% -0.4% -4.2% -1.5% -4.4% -4.5% -7.1% -1.1% -6.2% -0.4% 1.4% -0.5% -2.3% -1.6% 1.4% -7.1%

52 Week Return American Capital Strategies, Limited Apollo Investment Corporation Ares Capital Corporation Blackrock Kelso Capital Corp. Compass Diversified Holdings Fifth Street Finance Corp. Gladstone Capital Corporation Gladstone Investment Corporation Harris & Harris Group, Inc. Hercules Technology Growth Capital, Inc. Horizon Technology Finance Corp. Kayne Anderson Energy Development Company Kohlberg Capital Corporation Main Street Capital Corporation MCG Capital Corporation MVC Capital, Inc. NGP Capital Resources Co. PennantPark Investment Corporation Prospect Capital Corporation TICC Capital Corp. Tortoise Capital Resources Corp. Triangle Capital Corporation Mean Median High Low

49% -6% 2% -16% -14% 1% -24% 11% -1% 2% NA 43% 27% 30% -17% -14% -12% 4% -2% 3% 55% 15% 6% 2% 55% -24%

(1) Dividend Payout Ratio is calculated by dividing the annualized dividend of the current dividend payment by the First Call mean EPS estimate (2) YTD Return calculates the total return with the addition of paid dividends to the current closing stock price (3) TCAP, MAIN, & FSC debt is total. Both have zero debt for BDC regulatory purposes - debt in this table is SBA and subject to separate regulatory caps Source: SNL Financial (quarterly data) and company tax reports

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Specialty Finance

Balance Sheet Charts For All BDCs / Investment Companies

Price / NAV
1.4 1.30 1.26 1.24 14%

Recurring Return on Equity - NII / NAV

16% 14.1%

1.2

1.0 0.87 0.8 0.61 0.6

0.94 0.84 0.87 0.74 0.71 0.73

12% 0.92 0.89 0.87 0.71 0.63 0.62 0.87 0.80 0.69 8% 6.3% 6% 0.91 0.77 10% 10.1% 8.9% 9.3% 9.6% 8.4% 8.5% 9.6% 8.6% 7.9% 7.1%

10.9%

10.9%11.0% 9.8% 8.2% 8.0%

7.6%

0.4

4%

0.2

2% 0.3%

0.0

0%

Market Capitalization ($MM)

$3,500 2,954

Debt / Equity
100% 90% 80% 78% 96% 87%

$3,000

2,838

$2,500

70% 60%

65% 61% 56% 52% 46% 34% 36%

$2,000 1,673 $1,500

50% 40% 902 606 593 675 388 160 142 122 118 206 138 417 334 441 257 292 144 75 20% 386 10% 30% 19% 38% 39%

43% 31%

28% 20%

$1,000

$500

12% 2% 0% 0%

$0

0%

36%

Source: SNL Financial and SEC filings

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Specialty Finance

Income & Expense Charts For All BDCs

Gross Investment Income as a % of Total Assets
18% 16% 14% 12% 10% 8% 6% 4% 2% 0.4% 0% NA 0.0% 3.6% 3.9% 1.9% 1.0% 0.8% 0.7% 11.7% 16.7% 15.7% 14.9% 13.8% 12.9% 11.8% 12.8% 12.3% 2.5% 2.0% 9.4% 8.9% 7.7% 7.9% 1.5% 1.3% 1.1% 0.7% 1.4% 9.2% 2.0% 1.8% 1.9% 1.7% 1.7% 2.0% 14.6% 14.6% 3.0% 2.7%

Interest Expense as a % of Total Assets

3.5% 2.9% 2.6%

0.6%

0.5% 0.2% 0.0% 0.0% 0.0%

Management Fees as a % of Total Assets

7% 6.2% 6% 4.9% 4.6% 6.0% 5.9%

Net Investment Income as a % of Total Assets

12%

10% 4.7% 3.8% 3.6% 3.1% 3.0% 2.6% 2.3% 2.9% 2.4% 2.2% 1.9% 4% 3.5% 6% 4.5% 4.7% 4.6% 8% 6.9% 6.2% 5.9%

9.5% 9.1% 7.8% 7.1% 6.5% 5.7% 6.1% 5.6% 4.3% 7.0% 8.7%

5%

4%

3%

4.0%

2%

1% NA 0%

2%

1.1% NA

0%

(1) Gross Investment Income, Interest Expense, Management Fees, & Net Investment Income values are calculated on a TTM basis; Total Assets are calculated by averaging the quarter ending asset values over the same period (2) BDC's with a negative Net Invetsment Income are not included in chart 4 (3) Income & Expense charts do not include Compass Diversified Source: SNL Financial and SEC filings

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Specialty Finance

Yield / Dividend Charts For All BDC's / Investment Companies

Current Dividend Yield
18% 16% 14% 12% 10% 8% 6% 4.5% 4% 2% 2% 0.0% 0% 0.0% 0% 0.0% 0.0% 9.7% 13.1% 13.7% 12.6% 11.3% 11.1% 9.3% 10.4% 9.9% 9.0% 7.6% 6% 4.1% 4.9% 4% 3.1% 11.1% 11.2% 10.8% 11.2% 10.3% 6.3% 8% 15.7% 14.7% 10% 8.7% 8.2% 7.2% 6.1% 6.5% 6.7% 6.5% 7.2% 6.2% 7.0% 7.3% 7.3% 7.4% 9.6% 8.9%

Tax-Adjusted Dividend Yield

12% 10.7% 10.6%

Dividend Payout Ratio

900% 800% 800% 700% 600% 500% 400% 300% 200% 113%103%114% 100% 0% 0% 124% 84% 97% 78% 0% 119% 95% 107% 94% 100%105% 94% 89% 107%103% 49% 91%

52-Week Total Return

60% 50% 40% 30% 20% 11% 10% 2% 0% -1% -10% -20% -30% -6% -14% -24% -17% -14% -12% -2% 1% 2% 0% 4% 3% 27% 49% 43% 55%

15%

Source: SNL Financial and SEC filings

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30

35

10

15

20

25

10

15

20

25

30

35

0 Jan-01 May-01 Sep-01 Jan-02 May-02 Sep-02 Jan-03 May-03 Sep-03 Jan-04 May-04 Sep-04 BDCs Jan-05 May-05 Sep-05 Jan-06 5 Year May-06 Sep-06 Jan-07 May-07 Sep-07 10 Year Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 BDCs Sep-06 May-06 Jan-06 Sep-05 REITs May-05 Jan-05 Sep-04 May-04 Jan-04 Sep-03 May-03 Jan-03 Sep-02 May-02 Jan-02 Sep-01 May-01 Jan-01

Morgan Keegan & Co., Inc.

Source: SNL Financial and SEC filings

2001-2010 BDC Dividend Yield vs. U.S. REIT Yield (%)

2001-2010 BDC Dividend Yield vs. 10 Year & 5 Year Note (%)

Competitive Yield Charts For BDC Industry

10

10

Page 7 of 15
Sep-10 Sep-10 Sep-10 Oct-10 Oct-10 Nov-10 Nov-10 Dec-10 Dec-10 Jan-11 Jan-11 Feb-11 REITs BDCs Feb-11 Mar-11 Mar-11 Mar-11 Apr-11 Apr-11 May-11 May-11 Jun-11 Jun-11 Jul-11 Jul-11 Aug-11 Aug-11 Sep-11

9/2/2010 9/16/2010 9/30/2010 10/14/2010 10/28/2010 11/11/2010 11/25/2010 12/9/2010 12/23/2010 1/6/2011 BDCs 5 Year 1/20/2011 2/3/2011 2/17/2011 3/3/2011 3/17/2011 3/31/2011 4/14/2011 10 Year 4/28/2011 5/12/2011 5/26/2011 6/9/2011 6/23/2011 7/7/2011 7/21/2011 8/4/2011 8/18/2011 9/1/2011

1 Year BDC Dividend Yield vs. U.S. REIT Yield (%)

1 Year BDC Dividend Yield vs. 10 Year & 5 Year Note (%)
Specialty Finance

25

10

15

20

10

15

20

25

30

35

-5 0 5 0 5 Jan-01 May-01 Sep-01 Jan-02 May-02 Sep-02 Jan-03 May-03 Sep-03 Jan-04 May-04 Sep-04 Jan-05 May-05 Sep-05 Jan-06 May-06 Sep-06 Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 vs. 10 Year Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Sep-06 May-06 Jan-06 Sep-05 vs. 5 year May-05 Jan-05 Sep-04 May-04 Jan-04 Sep-03 May-03 Jan-03 Sep-02 May-02 Jan-02 Sep-01 May-01 Jan-01

Morgan Keegan & Co., Inc.

-5

Source: SNL Financial and SEC filings

2001-2010 BDC Dividend Yield Spread over U.S. REIT Yield (%)

Yield Spread Charts For BDC Industry

2001-2010 BDC Dividend Yield Spread over 10 Year & 5 Year Note (%)

Page 8 of 15
9/2/10 9/16/10 9/30/10 10/14/10 10/28/10 11/11/10 11/25/10 12/9/10 12/23/10 1/6/11 1/20/11 2/3/11 2/17/11 3/3/11 3/17/11 3/31/11 4/14/11 4/28/11 5/12/11 5/26/11 6/9/11 6/23/11 7/7/11 7/21/11 8/4/11 8/18/11 9/1/11

9/2/10 9/15/10 9/28/10 10/11/10 10/24/10 11/6/10 11/19/10 12/2/10 12/15/10 12/28/10 1/10/11 1/23/11 vs. 5 year vs. 10 Year 2/5/11 2/18/11 3/3/11 3/16/11 3/29/11 4/11/11 4/24/11 5/7/11 5/20/11 6/2/11 6/15/11 6/28/11 7/11/11 7/24/11 8/6/11 8/19/11 9/1/11

1 Year BDC Dividend Yield Spread over U.S. REIT Yield (%)

1 Year BDC Dividend Yield Spread over 10 Year & 5 Year Note (%)
Specialty Finance

-100 100 250 300 150 200 100 150 200 -50 50 50 -50 Jan-01 May-01 Sep-01 Jan-02 May-02 Sep-02 Jan-03 May-03 Sep-03 Jan-04 May-04 Sep-04 REITs Jan-05 May-05 Sep-05 Jan-06 May-06 Sep-06 Jan-07 May-07 Sep-07 BDCs BDCs Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-07 May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Sep-06 S&P 500 May-06 Jan-06 S&P 500 Sep-05 May-05 Jan-05 Sep-04 REITs May-04 Jan-04 Sep-03 May-03 Jan-03 Sep-02 May-02 Jan-02 Sep-01 May-01 Jan-01

Morgan Keegan & Co., Inc.

-100

Source: SNL Financial and SEC filings

2001-2010 BDC Index Total Return vs. S&P 500 & REIT Index (%)

2001-2010 BDC Index Performance vs. S&P 500 & REIT Index (%)

Stock Performance Charts For BDC Industry

-5

-5

-10

-15

-10

10

15

20

25

30

35

40

10

15

20

25

30

35

Page 9 of 15
9/2/10 9/16/10 9/30/10 10/14/10 10/28/10 11/11/10 11/25/10 12/9/10 12/23/10 1/6/11 REITs S&P 500 BDCs 1/20/11 2/3/11 2/17/11 3/3/11 3/17/11 3/31/11 4/14/11 4/28/11 5/12/11 5/26/11 6/9/11 6/23/11 7/7/11 7/21/11 8/4/11 8/18/11 9/1/11

9/2/10 9/16/10 9/30/10 10/14/10 10/28/10 11/11/10 11/25/10 12/9/10 12/23/10 1/6/11 REITs S&P 500 BDCs 1/20/11 2/3/11 2/17/11 3/3/11 3/17/11 3/31/11 4/14/11 4/28/11 5/12/11 5/26/11 6/9/11 6/23/11 7/7/11 7/21/11 8/4/11 8/18/11 9/1/11

1 Year BDC Index Total Return vs. S&P 500 & REIT Index (%)

1 Year BDC Index Performance vs. S&P 500 & REIT Index (%)
Specialty Finance

1,000

1,500

2,000

2,500

3,000

1,000

1,500

2,000

2,500

3,000

-500 500 500 Jan-01 May-01 Sep-01 Jan-02 May-02 Sep-02 Jan-03 May-03 Sep-03 Jan-04 May-04 Sep-04 Jan-05 May-05 Sep-05 Jan-06 May-06 Sep-06 Jan-07 May-07 BDCs Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 May-06 Sep-06 Jan-07 May-07 BDCs Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Jan-06 5yr Industrial 10yr Industrial Sep-05 May-05 Jan-05 Sep-04 May-04 5yr Bank Jan-04 Sep-03 10yr Bank May-03 Jan-03 Sep-02 May-02 Jan-02 Sep-01 May-01 Jan-01

Morgan Keegan & Co., Inc.

Source: SNL Financial and SEC filings

2001-2010 Yield Spread over 5 Year Note - BDC's, Industrials, Banks

2001-2010 Yield Spread over 10 Year Note - BDC's, Industrials, Banks

100

200

300

400

500

600

700

800

100

200

300

400

500

600

700

800

900

Yield Spread Comparison Charts for BDC, Banking, & Industrial Industry

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9/3/10 9/17/10 10/1/10 10/15/10 10/29/10 11/12/10 11/26/10 12/10/10 12/24/10 1/7/11 1/21/11 2/4/11 2/18/11 3/4/11 3/18/11 4/1/11 4/15/11 4/29/11 5/13/11 BDCs 5/27/11 6/10/11 6/24/11 7/8/11 7/22/11 8/5/11 8/19/11 9/2/11 10yr Bank 10yr Industrial

9/3/10 9/17/10 10/1/10 10/15/10 10/29/10 11/12/10 11/26/10 12/10/10 12/24/10 5yr Bank 5yr Industrial BDCs 1/7/11 1/21/11 2/4/11 2/18/11 3/4/11 3/18/11 4/1/11 4/15/11 4/29/11 5/13/11 5/27/11 6/10/11 6/24/11 7/8/11 7/22/11 8/5/11 8/19/11 9/2/11

1 Year Yield Spread over 5 Year Note - BDC's, Industrials, Banks

1 Year Yield Spread over 10 Year Note - BDC's, Industrials, Banks

Specialty Finance

Morgan Keegan & Co., Inc.

Specialty Finance

Select Financial Data

Company American Capital Strategies, Limited Apollo Investment Corporation Ares Capital Corporation Blackrock Kelso Capital Corp. Compass Diversified Holdings Fifth Street Finance Corp. Gladstone Capital Corporation Gladstone Investment Corporation Harris & Harris Group, Inc. Hercules Technology Growth Capital, Inc. Kayne Anderson Energy Development Company Kohlberg Capital Corporation Main Street Capital Corporation MCG Capital Corporation MVC Capital, Inc. NGP Capital Resources Co. PennantPark Investment Corporation Prospect Capital Corporation TICC Capital Corp. Tortoise Capital Resources Corp. Triangle Capital Corporation Ticker ACAS AINV ARCC BKCC CODI FSC GLAD GAIN TINY HTGC KED KCAP MAIN MCGC MVC NGPC PNNT PSEC TICC TTO TCAP Management Structure Internal External External External External External External External Internal Internal External External Internal Internal External External External External External External Internal IPO 9/4/1997 4/6/2004 10/5/2004 6/26/2007 5/10/2006 6/18/2008 8/27/2001 6/22/2005 8/23/1988 6/10/2005 9/20/06 12/12/2006 10/4/2007 11/29/2001 3/28/2000 11/10/2004 4/19/2007 7/28/2004 11/24/2003 2/2/2007 2/14/2007 Balance Sheet Information ($000) Assets Inv. Debt 6,333,000 3,259,302 4,911,531 1,032,523 976,368 1,093,768 314,130 242,132 173,384 691,253 331,719 260,779 617,253 1,066,056 488,659 289,906 817,593 1,549,317 329,552 99,512 486,732 5,917,000 3,123,260 4,643,163 947,656 976,368 1,053,479 299,279 165,295 164,086 475,193 322,290 254,266 592,028 849,101 414,590 230,298 778,944 1,463,010 308,773 97,619 409,400 1,642,000 1,249,203 1,620,142 275,000 88,000 302,000 92,700 40,000 2,550 258,562 67,000 60,000 260,637 511,210 50,000 70,000 230,650 406,700 0 0 224,150 Equity 4,541,000 1,911,232 3,134,281 717,617 454,905 775,649 217,536 200,035 168,426 423,901 235,443 194,592 334,627 534,033 414,337 208,287 504,939 1,114,357 321,776 97,633 256,800 Debt to Capital 27% 40% 34% 28% 16% 28% 30% 17% 1% 38% 22% 24% 44% 49% 11% 25% 31% 27% 0% 0% 47% Shares Out 353,824,055 196,392,758 205,129,966 73,215,936 134,449 72,375,832 21,039,242 22,080,133 31,000,601 43,856,062 10,302,464 22,599,304 23,197,465 77,035,877 23,916,982 21,628,202 45,689,781 109,316,449 32,671,485 9,164,865 22,650,238 Market Value ($mm) 2837.67 1673.27 2953.87 606.23 1.71 674.54 159.90 141.98 122.14 388.13 205.84 137.86 416.86 334.34 257.11 143.83 440.91 901.86 291.76 75.15 385.96

Low Mean Median High

Source: SNL Financial and SEC filings

0.0% 25.6% 26.7% 48.9%

$1.7 $614.1 $346.6 $2,953.9

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Specialty Finance

Expense Data
Gross Inv. Company American Capital Strategies, Limited Apollo Investment Corporation Ares Capital Corporation Blackrock Kelso Capital Corp. Compass Diversified Holdings
Fifth Street Finance Corp.

Interest Expense (IE) 113,000 54,082 102,636 11,106 11,060 10,724 2,144 559 14 9,868 3,405 1,777 3,715 11,119 15,853 3,053 1,409 4,604 17,598 0 0 8,303

Management Fees (ME) 193,000 123,034 237,680 40,941 13,979 38,213 13,164 8,054 7,679 25,494 7,879 6,485 8,003 10,761 28,196 10,951 10,871 30,975 57,657 15,763 1,694 10,993

Net Inv. Income (NII) 280,000 198,007 226,334 59,783 34,536 57,899 18,480 15,502 -7,088 37,062 10,291 -41,387 14,952 29,568 45,883 5,465 17,105 46,508 NA 23,351 -4,921 30,040

Values As a Percentage of Total Assets GII 9.36% 11.68% 14.90% 12.87% 31.41% 16.74% 11.84% 8.94% 0.43% 13.84% 12.85% 3.55% 7.66% 14.61% 7.92% 3.88% 9.18% 12.33% NA 14.62% 1.87% 15.71% IE 1.81% 1.68% 2.66% 1.28% 1.13% 1.68% 0.75% 0.21% 0.01% 1.89% 2.03% 0.71% 1.07% 2.95% 1.37% 0.61% NA 0.69% 1.99% 0.00% 0.00% 2.64% ME 3.08% 3.83% 6.15% 4.70% 1.43% 5.99% 4.61% 2.98% 5.38% 4.87% 4.69% 2.59% 2.30% 2.85% 2.44% 2.18% 3.57% 4.64% NA 5.89% 1.90% 3.49% NII 4.47% 6.17% 5.86% 6.86% 3.54% 9.07% 6.48% 5.75% -4.96% 7.08% 6.13% -16.55% 4.29% 7.84% 3.97% 1.09% 5.61% 6.97% NA 8.73% -5.53% 9.54%

Ticker ACAS AINV ARCC BKCC CODI FSC GLAD GAIN TINY HTGC HRZN KCAP MAIN MCGC MVC NGPC PNNT PSEC TICC TTO TCAP

Assets 6,258,500 3,211,195 3,861,944 871,002 976,368 638,188 285,310 269,830 142,784 523,482 167,917 250,061 348,131 377,357 1,155,948 501,698 304,760 667,060 882,479 267,512 88,926 314,746

Income (GII) 586,000 375,123 575,472 112,128 306,692 106,836 33,788 24,115 609 72,424 21,575 8,878 26,670 55,130 91,566 19,455 27,976 82,281 169,492 39,114 1,666 49,437

Gladstone Capital Corporation Gladstone Investment Corporation Harris & Harris Group, Inc. Hercules Technology Growth Capital, Inc. Horizon Technology Finance Corp. Kohlberg Capital Corporation Main Street Capital Corporation MCG Capital Corporation MVC Capital, Inc. NGP Capital Resources Co. PennantPark Investment Corporation Prospect Capital Corporation TICC Capital Corp. Tortoise Capital Resources Corp. Triangle Capital Corporation

Kayne Anderson Energy Development Company KED

Low Mean Median High

0.43% 11.25% 11.84% 31.41%

0.00% 1.29% 1.28% 2.95%

1.43% 3.79% 3.57% 6.15%

-16.55% 3.92% 5.86% 9.54%

(1) Gross Investment Income, Interest Expense, Management Fees, & Net Investment Income values are calculated on a TTM basis; Total Assets are calculated by averaging the quarter ending asset values over the same period Source: SNL Financial and SEC filings

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Current Pricing Summary

52 week Company American Capital Strategies, Limited Apollo Investment Corporation Ares Capital Corporation Blackrock Kelso Capital Corp. Compass Diversified Holdings Fifth Street Finance Corp. Gladstone Capital Corporation Gladstone Investment Corporation Harris & Harris Group, Inc. Hercules Technology Growth Capital, Inc. Horizon Technology Finance Corp. Kohlberg Capital Corporation Main Street Capital Corporation MCG Capital Corporation MVC Capital, Inc. NGP Capital Resources Co. PennantPark Investment Corporation Prospect Capital Corporation TICC Capital Corp. Tortoise Capital Resources Corp. Triangle Capital Corporation Ticker ACAS AINV ARCC BKCC CODI FSC GLAD GAIN TINY HTGC HRZN KCAP MAIN MCGC MVC NGPC PNNT PSEC TICC TTO TCAP 9/6/2011 $8.02 $8.52 $14.40 $8.28 $12.70 $9.32 $7.60 $6.43 $3.94 $8.85 $15.44 $19.98 $6.10 $17.97 $4.34 $10.75 $6.65 $9.65 $8.25 $8.93 $8.20 $17.04 High 10.85 12.46 17.97 12.97 18.50 13.95 12.17 8.55 6.30 11.55 16.45 21.42 8.71 19.98 7.62 15.18 10.89 13.19 12.38 13.11 9.27 20.97 Low 7.10 7.32 12.75 7.05 11.46 8.38 7.23 6.22 3.85 8.12 12.24 17.25 3.42 15.98 3.50 10.60 6.21 8.79 7.41 7.71 7.25 15.01 Dividend Yield 0.00% 13.15% 9.72% 12.56% 11.34% 13.73% 11.05% 9.33% 0.00% 9.94% 10.36% 7.61% 11.15% 9.02% 15.67% 4.47% 10.83% 11.19% 14.74% 11.20% 4.88% 10.33% Effective Tax Rate 33.3% 34.2% 34.8% 34.9% 15.0% 35.0% 34.9% 35.0% 15.0% 35.0% 35.0% 15.0% 35.0% 31.3% 31.5% 30.1% 35.0% 34.9% 27.9% 35.0% 15.0% 27.9% Tax-Adjusted Div. Yield 0.00% 8.65% 6.34% 8.17% 9.64% 8.92% 7.20% 6.07% 0.00% 6.46% 6.74% 6.47% 7.25% 6.20% 10.74% 3.12% 7.04% 7.28% 10.62% 7.28% 4.15% 7.44% Avg. Div. Payout Ratio 0.0% 113.1% 102.9% 114.3% 84.3% 124.2% 96.6% 77.9% 0.0% 94.6% 107.4% 93.8% 100.0% 104.5% 119.3% 800.0% 93.5% 89.3% 106.7% 103.1% 49.4% 90.7% 52 Week Actual Div. ($) 0.00 1.12 1.40 1.04 1.40 1.28 0.84 0.60 0.00 0.88 1.60 1.52 0.68 1.62 0.68 0.48 0.72 1.08 1.22 1.00 0.40 1.76 52-Week Return 48.52% -6.32% 1.64% -16.09% -13.84% 0.60% -24.16% 10.86% -1.01% 1.99% NA 42.81% 26.55% 29.96% -16.81% -14.32% -11.51% 3.61% -1.93% 3.15% 55.09% 14.89% Week Return -1.60% 0.59% -0.96% -1.19% -2.01% -2.68% -4.16% -3.16% -4.37% -1.01% -0.96% -0.40% -4.24% -1.53% -4.41% -4.53% -7.12% -1.13% -6.17% -0.45% 1.36% -0.53% NAV/ Share ($) 13.16 9.76 15.28 9.83 9.74 10.72 10.34 9.06 5.43 9.67 17.40 22.85 8.61 14.24 6.93 17.32 9.63 11.08 10.36 9.85 10.66 13.79 Price/ NAV 0.61 0.87 0.94 0.84 1.30 0.87 0.74 0.71 0.73 0.92 0.89 0.87 0.71 1.26 0.63 0.62 0.69 0.87 0.80 0.91 0.77 1.24

Kayne Anderson Energy Development CompanyKED

Low Mean Median High

Source: SNL Financial and SEC filings

0.00% 9.65% 10.59% 15.67%

15.00% 30.03% 34.47% 35.00%

0.00% 6.63% 7.12% 10.74%

0.00% 121.17% 98.28% 800.00%

$0.00 $0.97 $1.02 $1.76

-24.2% 6.4% 1.6% 55.1%

-7.12% -2.30% -1.56% 1.36%

0.61 0.85 0.86 1.30

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ADDITIONAL INFORMATION AVAILABLE UPON REQUEST IMPORTANT DISCLOSURES

The research analyst responsible for the preparation of this report does not hold investment positions of any nature in the securities of this issuer. The research analyst responsible for the preparation of this report is compensated in part on the firm's investment banking revenue but is not compensated based upon specific investment banking services transactions. As of the date of this report, Morgan Keegan & Co., Inc. makes a market in CODI, FDUS, HRZN, MAIN, PSEC and TCAP . Morgan Keegan & Co., Inc. has received compensation for investment banking services from CODI, FDUS, HRZN, MAIN and TCAP in the past 12 months. Morgan Keegan & Co., Inc. expects to receive or intends to seek compensation for investment banking services from CODI, HRZN, MAIN, PSEC and TCAP in the next 3 months. Morgan Keegan & Co., Inc. managed or co-managed a public offering for CODI, FDUS, HRZN, MAIN and TCAP in the past 12 months. MK Performance Ratings: O = Outperform (Expected to outperform the S & P 500* over the next 12 months) M = Market Perform (Expected to perform in line with the S & P 500* over the next 12 months) U= Underperform (Expected to underperform the S & P 500* over the next 12 months) *REITs' performance benchmark is total return relative to the NAREIT Equity Index. For regulatory purposes, our ratings of Outperform, Market Perform and Underperform most closely correspond to Buy, Hold and Sell, respectively. MK Suitability Ratings: S = Speculative (Business or balance sheet risk materially above that of the average U.S. public company) M = Market Risk (Business or balance sheet risk not materially different from the average U.S. public company) C = Conservative (Business or balance sheet risk materially below that of the average U.S. public company)
Morgan Keegan Companies Rated: Outperform / Buy Market Perform / Hold Underperform / Sell Not Rated 55% 33% 1% 11% Investment Banking Clients within last 12 months: Outperform / Buy 16% Market Perform / Hold 9% Underperform / Sell 50% Not Rated 2%

For purposes of the NYSE and NASDAQ, rating distribution disclosure requirements, our rating of Outperform, Market Perform and Underperform closely correspond to Buy, Hold and Sell, respectively.

ANALYST CERTIFICATION
The research analyst responsible for the preparation of this research report certifies that; (a) the views expressed in this research report accurately reflect the research analyst's personal views about any and all of the subject security(ies) and issuer(s), and (b) no part of the research analyst's compensation was, is, or will be directly or indirectly related to the specific recommendations or views contained in this research report. Twelve-month price targets for securities under coverage may be based upon various valuation metrics including without limitation: price/earnings ratios, price/sales ratios, discounted cash flow (DCF), relative multiples, sum of the parts, etc. Price targets are, as of the date of the report in which they appear, subject to change, and imply no guarantee of performance. Research reports may contain a short-term trading idea which highlights near-term catalysts or events affecting the company, its competitors or the market that should have a short-term price effect on the company's shares. Short-term trading ideas are not related to a stock's performance rating, which focuses both on a longer-term return and attractiveness for investment relative to the relevant benchmark. Short-term trading ideas are different from performance ratings and, by their very nature, will be more positive or more negative than the performance rating. Research reports are not intended to provide personal investment advice and do not take into account the specific investment objectives, financial situation, or particular needs of any specific person. No security or investment strategy can suit all investors. Investors should seek financial advice regarding the appropriateness of their investing in any security or implementing any investment strategy discussed in a report and should understand that any statement in a report regarding future prospects may not be realized. This research report is not intended to provide personal investment objectives, financial situation, or particular needs of any specific person. No security or investment strategy can suit all investors. Investors should seek financial advice

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regarding the appropriateness of their investing in any security or implementing any investment strategy discussed in this report and should understand that any statement in this report regarding future prospects may not be realized. ADDITIONAL DISCLOSURES: The information contained in this report is based on sources considered to be reliable but is not represented to be complete and its accuracy is not guaranteed.The opinions expressed reflect the judgment of the author as of the date of publication and are subject to change without notice. This report does not constitute an offer to sell or a solicitation of an offer to buy any securities. Morgan Keegan & Co., Inc., a subsidiary of Regions Financial Corporation, and its officers, directors, shareholders and employees, and affiliates and members of their families may have positions in these securities and may, as principal or agent, buy and sell such securities before, after or concurrently with the publication of this report. Morgan Keegan & Co., Inc., member FINRA, SIPC, is a registered broker-dealer subsidiary of Regions Financial Corporation. Investments are NOT FDIC INSURED, NOT BANK GUARANTEED and MAY LOSE VALUE. For more information about Morgan Keegan disclosures, please go to https://mk.bluematrix.com/sellside/Disclosures.action To obtain a copy of the most recent disclosure information regarding the individual securities mentioned in this compendium report, please write to us at the following address: Equity Research Department Attn: Director of Research Morgan Keegan & Co., Inc. 50 N. Front Street - 13th floor Memphis, TN 38103

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