exhibit42






Exhibit
4.[2]







DESCRIPTION OF THE
REGISTRANT’S SECURITIES



REGISTERED PURSUANT TO SECTION 12 OF THE SECURITIES EXCHANGE ACT OF
1934



 


The
following is a brief description of the common stock, $0.001 par
value per share (the “Common Stock”), of AeroCentury
Corp. (the “Company”), which is the only security of
the Company registered pursuant to Section 12 of the Securities
Exchange Act of 1934, as amended.


 



Description of Common Stock


 



General


 


The
following summary of the material features of our Common Stock and
certain provisions of Delaware law do not purport to be complete
and is subject to, and qualified in its entirety by, the provisions
of our Amended and Restated Certificate of Incorporation, our
Amended and Restated Bylaws, the Delaware General Corporation Law
(“DGCL”) and other applicable law. Copies of our
Amended and Restated Certificate of Incorporation and our Amended
and Restated Bylaws have been filed with the Securities and
Exchange Commission (the “SEC”) as Exhibit 3.1 and
Exhibit 3.2, respectively, to our Annual Report on Form 10-K. All
of our outstanding Common Stock are validly issued, fully paid and
non-assessable. Our Common Stock is listed on the NYSE American and
trades under the symbol “ACY.”

 



Common Stock

 



Dividend rights

 


Subject
to preferences that may apply to any shares of preferred stock
outstanding at the time, the holders of Common Stock will be
entitled to share equally, identically and ratably in any dividends
that the board of directors may determine to issue from time to
time out of legally available funds. We have never paid cash
dividends on our Common Stock and do not anticipate paying periodic
cash dividends on our Common Stock for the foreseeable
future.

 



Voting rights

 


Each
holder of our Common Stock is entitled to one vote for each share
on all matters submitted to a vote of the stockholders. Subject to
any rights that may be applicable to any then outstanding preferred
stock, our Common Stock votes as a single class on all matters
relating to the election and removal of directors on our board of
directors and as provided by law. Holders of our Common Stock do
not have cumulative voting rights. Except in respect of matters
relating to the election and removal of directors on our board of
directors and as otherwise provided in our Amended and Restated
Certificate of Incorporation or required by law, all matters to be
voted on by our stockholders must be approved by a majority of the
shares present in person or by proxy at the meeting and entitled to
vote on the subject matter. In the case of election of directors,
all matters to be voted on by our stockholders must be approved by
a plurality of the votes entitled to be cast by all shares of our
Common Stock.

 



Liquidation Rights

 


In the
event of any voluntary or involuntary liquidation, dissolution or
winding up of our affairs, holders of our Common Stock would be
entitled to share ratably in our assets that are legally available
for distribution to stockholders after payment of our debts and
other liabilities. If we have any preferred stock outstanding at
such time, holders of the preferred stock may be entitled to
distribution and/or liquidation preferences. In either such case,
we must pay the applicable distribution to the holders of our
preferred stock before we may pay distributions to the holders of
our Common Stock.

 



No Preemptive or Similar Rights

 


Our
stockholders have no preemptive, conversion or other rights to
subscribe for additional shares of our Common Stock. All
outstanding shares of our Common Stock are, and all shares of our
Common Stock offered by this prospectus will be, when sold, validly
issued, fully paid and nonassessable.

 



Limitation on Rights of Holders of Common Stock – Preferred
Stock

 


The
rights, preferences and privileges of the holders of Common Stock
are subject to, and may be adversely affected by, the rights of the
holders of shares of any series of preferred stock that we may
designate in the future.

 


Our
Amended and Restated Certificate of Incorporation authorizes our
Board of Directors, without further stockholder action, to provide
for the issuance of up to 2,000,000 shares of preferred stock. Our
board of directors may, without further action by our stockholders,
fix the rights, preferences, privileges and restrictions of up to
an aggregate of shares of preferred stock in one or more series and
authorize their issuance. These rights, preferences and privileges
could include dividend rights, conversion rights, voting rights,
terms of redemption, liquidation preferences, sinking fund terms
and the number of shares constituting any series or the designation
of such series, any or all of which may be greater than the rights
of our Common Stock. The issuance of our preferred stock could
adversely affect the voting power of holders of our Common Stock
and the likelihood that such holders will receive dividend payments
and payments upon liquidation. In addition, the issuance of
preferred stock could have the effect of delaying, deferring or
preventing a change of control or other corporate
action.

 



Certain Anti-Takeover Matters

 



Amended and Restated Certificate of Incorporation and Amended and
Restated Bylaw Provisions

 


Our
Amended and Restated Certificate of Incorporation and Amended and
Restated Bylaws contain certain provisions that are intended to
enhance the likelihood of continuity and stability in the
composition of our board of directors and in the policies
formulated by our board of directors and to discourage an
unsolicited takeover of our company if our board of directors
determines that such a takeover is not in the best interests of our
company and stockholders. However, these provisions could have the
effect of discouraging certain attempts to acquire us or remove
incumbent management even if some or a majority of our stockholders
deemed such an attempt to be in their best interests, including
those attempts that might result in a premium over the market price
for the shares of our Common Stock held by
stockholders.

 


Our
Amended and Restated Certificate of Incorporation and Amended and
Restated Bylaws provide that our board of directors is classified
into three classes of directors. A third party may be discouraged
from making a tender offer or otherwise attempting to obtain
control of us as it is more difficult and time consuming for
stockholders to replace a majority of the directors on a classified
board of directors.

 


Our
Amended and Restated Bylaws establish advance notice procedures
with regard to stockholder proposals and the nomination, other than
by or at the direction of the board of directors or a committee
thereof, of candidates for election as directors. We may reject a
stockholder proposal or nomination that is not made in accordance
with such procedures. In addition, our Amended and Restated Bylaws
provide that:




●

special meetings of
the stockholders of the Company may be called, for any purpose as
is a proper matter for stockholder action under Delaware law, by
only the directors or by any officers instructed by the directors
to call the meeting;








●

a director may not
be removed from office without cause unless by the vote of the
holders of 66 2/3% or more of the outstanding shares of our Common
Stock entitled to vote at a special meeting of stockholders;
and








●

our Amended and
Restated Bylaws may be altered, amended or repealed at any regular
meeting of the stockholders (or at any special meeting thereof duly
called for such purpose) by the affirmative vote of holders of at
least 66 2/3% of our entire capital stock that is issued,
outstanding and entitled to vote.





 



Section 203 of the Delaware General Corporation Law

 


We are
subject to the provisions of Section 203 of the DGCL. Under Section
203, we would generally be prohibited from engaging in any business
combination with any interested stockholder for a period of three
years following the time that this stockholder became an interested
stockholder unless:




●

prior to this time,
the board of directors of the corporation approved either the
business combination or the transaction that resulted in the
stockholder becoming an interested stockholder;








●

upon consummation
of the transaction that resulted in the stockholder’s
becoming an interested stockholder, the interested stockholder
owned at least 85% of the voting stock of the corporation
outstanding at the time the transaction commenced, excluding shares
owned by persons who are directors and also officers, and by
employee stock plans in which employee participants do not have the
right to determine confidentially whether shares held subject to
the plan will be tendered in a tender or exchange offer;
or








●

at or subsequent to
such time, the business combination is approved by the board of
directors and authorized at an annual or special meeting of
stockholders, and not by written consent, by the affirmative vote
of at least 66 2⁄3% of the outstanding voting stock that is
not owned by the interested stockholder.





 


Under
Section 203, a “business combination”
includes:




●

any merger or
consolidation involving the corporation and the interested
stockholder;








●

any sale, transfer,
pledge or other disposition of 10% or more of the assets of the
corporation involving the interested stockholder;








●

any transaction
that results in the issuance or transfer by the corporation of any
stock of the corporation to the interested stockholder, subject to
limited exceptions;








●

any transaction
involving the corporation that has the effect of increasing the
proportionate share of the stock of any class or series of the
corporation beneficially owned by the interested stockholder;
or








●

the receipt by the
interested stockholder of the benefit of any loans, advances,
guarantees, pledges or other financial benefits provided by or
through the corporation





 



            

In general, Section
203 defines an interested stockholder as an entity or person
beneficially owning 15% or more of the outstanding voting stock of
the corporation and any entity or person affiliated with or
controlling or controlled by such entity or person.





 



Limitation of Liability and Indemnification Matters

 


Our
Amended and Restated Certificate of Incorporation and our Amended
and Restated Bylaws provide for indemnification of our directors,
officers, employees and other agents to the maximum extent
permitted by applicable law. We also have entered into
indemnification agreements with our executive officers and
directors and provide indemnity insurance pursuant to which
directors and officers are indemnified or insured against liability
or loss under certain circumstances which may include liability or
related loss under the Securities Act and the Exchange
Act.