Allied Capital Commits $210.5 Million to Management-led Buyout Of Leading Full-Service Commercial Printer.

WASHINGTON -- Allied Capital Corporation (NYSE:ALD) announced today that it has committed $210.5 million to support the management-led buyout of EarthColor, Inc., a leading one-stop commercial printer serving blue-chip customers in the pharmaceutical, telecommunications and financial services industry. Based in New York City, EarthColor is the largest promotional printer in the New York metropolitan market, while also serving customers nationwide with facilities in New Jersey, Florida, Texas and Arizona.

Allied Capital's investment took the form of a senior revolving credit facility, senior subordinated debt and non-voting common equity. At closing, Allied Capital funded $197.5 million of its commitment. The senior management of EarthColor also made a significant equity investment in the company, acquiring a majority of the voting common stock.

Founded in 1982, EarthColor has developed organically and through acquisitions into a diversified, full-service provider of commercial printing solutions. The company serves a highly diversified customer base of blue-chip companies, focusing primarily on short-run, high-end promotional products such as direct mail pieces, brochures, product information and free standing inserts. The company's integrated solutions are custom-designed for each customer and include every step of the workflow process including digital prepress services, printing, finishing, digital archiving, print-on-demand and fulfillment services.

"Allied Capital's decision to invest in EarthColor reflects our high degree of confidence in the company's skilled and experienced management team, led by founder and CEO Robert Kashan," said John Fruehwirth, Managing Director of Allied Capital. "Robert and his team have created a market-leading business, positioning EarthColor as a mid-size printer with a low-cost operating platform, but with the capacity and flexibility to handle large print jobs with short lead times for their customers. This unique combination will allow the company to continue building on its success as it pursues growth opportunities in its markets."

"We have known the Allied Capital team for sometime now and are pleased to have them as our new financial partner as we position our company for the next phase of growth by building out our national platform to enhance our service offerings to our customers," said Robert Kashan, CEO of EarthColor. "Allied Capital's financial strength and understanding of our business will make them a value-added partner for us going forward."

About Allied Capital

Allied Capital Corporation, a leading business development company with total assets of more than $4 billion, has paid regular, quarterly cash dividends to shareholders since 1963. Allied Capital invests in the American entrepreneurial economy by providing capital to companies seeking a long-term financial partner and access to managerial resources often unavailable to smaller companies. Since its IPO in 1960, Allied Capital has provided long-term debt and equity financing to thousands of middle market companies. In serving its shareholders, Allied Capital helps build middle market businesses and support American jobs. The Company's private finance portfolio includes investments in over 100 companies that generate aggregate revenues of more than $12 billion and employ more than 85,000 people.

Allied Capital provides flexible, competitive debt and equity capital for management and sponsor-led buyouts, recapitalizations, acquisitions and growth of middle market companies. Allied Capital's seamless, one-stop financing capabilities include first and second lien senior loans, unitranche debt, junior or mezzanine debt and equity.

Headquartered in Washington, DC, Allied Capital offers shareholders the opportunity to participate in the private equity industry through an investment in the Company's New York Stock Exchange-listed stock, which is traded under the symbol ALD. For more information, please visit www.alliedcapital.com, call Allied Capital investor relations toll-free at [phone], or e-mail us at [e-mail]. All media inquiries should be directed to Stan Collender of Qorvis Communications at 202-448-3131.

About EarthColor, Inc.

Founded in 1982 by Robert Kashan, CEO, EarthColor is a privately-held commercial printer focused on providing a one-stop printing solution of electronic prepress, printing and finishing primarily of promotional products. EarthColor is the largest competitor in the New York metropolitan market and one of the largest competitors in its other markets. The company operates a low-cost distributed print platform with production facilities in New York, New Jersey, Florida, and Texas, with additional prepress operations in Arizona. EarthColor's customers are blue-chip companies with an emphasis on industries with less advertising cyclicality such as telecommunications, pharmaceuticals and financial services. The Company specializes in short-run, high quality printed products that require quick turnaround times and significant customer service. For more information, please visit www.earthcolor.com.

Forward-Looking Statements

The information contained in this press release contains forward-looking statements. These forward-looking statements are subject to the inherent uncertainties in predicting future results and conditions. Certain factors could cause actual results and conditions to differ materially from those projected in these forward-looking statements, and some of these factors are enumerated in Allied Capital's periodic filings with the Securities and Exchange Commission.