From August 2007 to January 2010, Mr. Watson, age 34, served as Director of Portfolio Accounting for MCG Capital Corporation. From July 2001 to July 2007, Mr. Watson was employed by Capital Advisory Services, LLC, which subsequently joined Navigant Consulting, Inc., where he held various positions providing finance and accounting consulting services.

The Company does not pay cash compensation or provide other benefits directly to Mr. Watson or to any of its other executive officers. Mr. Watson is an employee of Gladstone Administration, LLC (the "Administrator"), is compensated for his services to the Company by the Administrator pursuant to the terms of an administration agreement between the Company and the Administrator (the "Administration Agreement"). Pursuant to the Administration Agreement, the Company makes payments equal to its allocable portion of the Administrator's overhead expenses in performing its obligations under the Administration Agreement including, but not limited to, the Company's allocable portion of the salary and bonus ("Salary Expenses") of Mr. Watson. Based on the December 31, 2009 proportion of expense reimbursement due to the Administrator under the Administration Agreement, the Company expects that its allocable portion of Mr. Watson's annualized Salary Expenses will be approximately $51,000.