Document:

Exhibit 4.3

 

DESCRIPTION OF SHARES

 

Our charter authorizes the issuance of 200.0
million Common Shares and 50.0 million shares of preferred stock, $0.01 par value per share. In addition, our board of directors
may amend our charter from time to time without stockholder approval to increase or decrease the aggregate number of shares of
stock or the number of shares of stock of any class or series that we have authority to issue.

 

Common Shares

 

Subject to the restrictions on ownership
and transfer of stock contained in our charter and except as may otherwise be specified in our charter, the holders of our Common
Shares are entitled to one vote per Common Share on all matters submitted to a stockholder vote, including the election of our
directors. There is no cumulative voting in the election of our directors. Therefore, the holders of a majority of our outstanding
Common Shares can elect our entire board of directors. Except as our charter may provide with respect to any series of preferred
stock that we may issue in the future, the holders of our Common Shares will possess exclusive voting power.

 

Holders of our Common Shares will be entitled
to receive such distributions as authorized from time to time by our board of directors and declared by us out of legally available
funds, subject to any preferential rights of any preferred stock that we issue in the future. In any liquidation, each outstanding
Common Share entitles its holder to share (based on the percentage of Common Shares held) in the assets that remain after we pay
our liabilities and any preferential distributions owed to preferred stockholders. Holders of Common Shares do not have preemptive
rights, which means that you will not have an automatic option to purchase any new Common Shares that we issue, nor do holders
of our Common Shares have any preference, conversion, exchange, sinking fund or redemption rights. Holders of Common Shares will
not have appraisal rights unless our board of directors determines that appraisal rights apply, with respect to all or any classes
or series of stock, to a particular transaction or all transactions occurring after the date of such determination in connection
with which holders of such Common Shares would otherwise be entitled to exercise appraisal rights. Our Common Shares will be nonassessable
by us upon our receipt of the consideration for which our board of directors authorized its issuance.

 

Our charter authorizes our board of directors
to classify and reclassify any unissued Common Shares into other classes or series of stock. Prior to issuance of shares of each
class or series, the board is required by Maryland law and by our charter to set, subject to our charter restrictions on ownership
and transfer of our stock, the preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends
or other distributions, qualifications and terms and conditions of redemption for each class or series. Our board of directors
has authorized the issuance of shares of our capital stock without certificates. We expect that, until our shares are listed on
a national securities exchange, we will not issue Common Shares in certificated form. Information regarding restrictions on the
ownership and transfer of our Common Shares that, under Maryland law, would otherwise have been required to appear on our stock
certificates will instead be furnished to stockholders upon request and without charge.

 

We maintain a stock ledger that contains
the name and address of each stockholder and the number of shares that the stockholder holds. With respect to uncertificated stock,
we will continue to treat the stockholder registered on our stock ledger as the owner of the shares noted therein until the new
owner delivers a properly executed form to us, which form we will provide to any registered holder upon request.

 

 

Preferred Stock

 

Our charter authorizes our board of directors
to designate and issue one or more classes or series of preferred stock without approval of our holders of Common Shares. Prior
to issuance of shares of each class or series, the board is required by Maryland law and by our charter to set, subject to our
charter restrictions on ownership and transfer of our stock, the terms, preferences, conversion or other rights, voting powers,
restrictions, limitations as to dividends or other distributions, qualifications and terms and conditions of redemption of each
class or series of preferred stock so issued, which may be more beneficial than the rights, preferences and privileges attributable
to our Common Shares. The issuance of preferred stock could have the effect of delaying, deferring or preventing a change in control.
Our board of directors has no present plans to issue preferred stock, but may do so at any time in the future without stockholder
approval. However, the issuance of any additional shares of preferred stock must be approved by a majority of independent directors
not otherwise interested in the transaction, who will have access at our expense to our legal counsel or to independent legal counsel.

 

     

     

    

 

Meetings and Special Voting Requirements

 

An annual meeting of our stockholders will
be held each year, at least 30 days after delivery of our annual report on the date and at the time and place set by our board
of directors. Special meetings of stockholders may be called upon the request of a majority of our directors, a majority of our
independent directors, our chief executive officer, our chairman or our president and must be called by our secretary to act on
any matter that may properly be considered at a meeting of stockholders upon the written request of stockholders entitled to cast
at least 10% of the votes entitled to be cast on such matter at the special meeting. Upon receipt of a written request of stockholders
entitled to cast at least 10% of the votes entitled to be cast stating the purpose of the special meeting, our secretary will provide
all our holders of Common Shares written notice of the meeting and the purpose of such meeting. The written notice shall specify
the time and place of the special meeting specified in the stockholders’ request; provided, however,
that if none is so specified, such meeting shall be held at a time and place convenient to stockholders. The meeting must be held
not less than 15 days or more than 60 days after the distribution of the notice of the meeting. The presence in person or by proxy
of stockholders entitled to cast at least 50% of all the votes entitled to be cast on any matter that may properly be considered
at any stockholder meeting constitutes a quorum. Unless otherwise provided by the Maryland General Corporation Law or our charter,
the affirmative vote of a majority of all the votes cast is necessary to take stockholder action. With respect to the election
of directors, each candidate nominated for election to the board of directors must receive the affirmative vote of a majority of
the shares present, in person or by proxy, in order to be elected. Therefore, if a nominee receives fewer “for” votes
than “withhold” votes in an election, then the nominee will not be elected.

 

Under the Maryland General Corporation Law
and our charter, stockholders are generally entitled to vote at a duly held meeting at which a quorum is present on (1) amendments
to our charter, (2) our liquidation or dissolution, (3) a merger, consolidation or sale or other disposition of all or substantially
all of our assets, (4) a statutory share exchange and (5) election or removal of our directors. The affirmative vote of stockholders
entitled to cast a majority of all the votes entitled to be cast is required to approve any such action (except that the affirmative
vote of a majority of the shares represented in person or by proxy at a meeting at which a quorum is present is sufficient to elect
a director). Without the approval of a majority of the stockholders entitled to vote, our board of directors may not (i) amend
our charter to materially and adversely affect the rights, preferences and privileges of the stockholders; (ii) amend provisions
of our charter relating to director qualifications, fiduciary duties, liability and indemnification, conflicts of interest, investment
policies or investment restrictions; (iii) liquidate or dissolve our company other than before the initial investment in a property,
mortgage or other investment owned by our company, directly or indirectly through one or more of our affiliates; (iv) sell all
or substantially all of a property, mortgage or other investment owned by our company, directly or indirectly through one or more
of our affiliates other than in the ordinary course of business or as otherwise permitted by law; or (v) cause the merger or similar
reorganization of our company except as permitted by law.

 

Our advisory agreement with our advisor has
a one-year term but may be renewed for an unlimited number of successive one-year periods upon the mutual consent of our advisor
and us. Our independent directors will annually review our advisory agreement with our advisor. Although the stockholders do not
have the ability to vote to replace our advisor or to select a new advisor, stockholders do have the ability, by the affirmative
vote of stockholders entitled to cast a majority of the votes entitled to be cast generally in the election of directors, to remove
a director from our board with or without cause. With respect to shares of our stock owned by our advisor, any director or any
of their affiliates, neither our advisor, nor any such director nor any of their affiliates may vote on matters submitted to the
stockholders regarding the removal of our advisor, any such director or any affiliates or any transaction between us and any of
the aforementioned parties.

 

Advance Notice for Stockholder Nominations for Directors
and Proposals of New Business

 

In order for a stockholder to nominate a
director or propose new business at the annual stockholders meeting, our bylaws generally require that the stockholder give notice
of the nomination or proposal not earlier than the 150th day nor later than 5:00 p.m., Eastern Time, on the 120th day
prior to the first anniversary of the date of the proxy statement for the preceding year’s annual stockholders meeting and
be a stockholder of record both at the time of giving advance notice and at the time of the meeting and be entitled to vote in
the election of each individual so nominated or on such other business, unless such nomination or proposal is made pursuant to
the company’s notice of the meeting or by or at the direction of our board of directors. Our bylaws contain a similar notice
requirement in connection with nominations for directors at a special meeting of stockholders called for the purpose of electing
one or more directors. With respect to special meetings of stockholders, only the business specified in our notice of the meeting
may be brought before the meeting. Nominations of individuals for election to the board of directors at a special meeting may be
made only (i) pursuant to our notice of the meeting, (ii) by or at the direction of the board of directors, or (iii) provided that
the board of directors has determined that directors will be elected at the meeting, by a stockholder who is a stockholder of record
both at the time of giving advance notice of such nomination and at the time of the meeting, who is entitled to vote at the meeting
in the election of each individual so nominated and who has complied with the advance notice provisions of the bylaws. Failure
to comply with the notice provisions will make stockholders unable to nominate directors or propose new business.

 

     

     

    

 

Restrictions on Ownership of Shares

 

Ownership Limits

 

To maintain our REIT qualification following
the taxable year ending December 31, 2015, not more than 50% in value of our outstanding shares may be owned, directly or indirectly,
by five or fewer individuals (including certain entities treated as individuals under the Code) during the last half of each taxable
year. In addition, at least 100 persons who are independent of us and each other must beneficially own our outstanding shares for
at least 335 days per 12-month taxable year or during a proportionate part of a shorter taxable year. Each of the requirements
specified in the two preceding sentences need not be met during a corporation’s initial tax year as a REIT. We intend to
elect to be taxed as a REIT commencing with our taxable year ended December 31, 2015. We may prohibit certain acquisitions and
transfers of Common Shares so as to ensure our continued qualification as a REIT under the Code. However, we cannot assure you
that this prohibition will be effective.

 

To help ensure that we meet these tests,
among other purposes, our charter prohibits any person or group of persons from acquiring, directly or indirectly, beneficial ownership
of more than 9.8% in value of the aggregate of our outstanding shares of stock and more than 9.8% (in value or number of shares,
whichever is more restrictive), of any class or series of our shares of stock, unless exempted by our board of directors. Our board
of directors may waive these ownership limits with respect to a particular person (prospectively or retroactively) if the board
receives evidence that ownership in excess of the limits will not jeopardize our REIT status and certain other representations
and undertakings required by our charter. For purposes of this provision, we treat corporations, partnerships and other entities
as single persons. However, the board may not exempt any person whose ownership of our outstanding stock would result in our being
 “closely held” within the meaning of Section 856(h) of the Code or otherwise would result in our being “closely
held” within the meaning of Section 856(h) of the Code or otherwise would result in our failing to qualify as a REIT. In
order to be considered by the board for exemption, a person also must not own, directly or indirectly, an interest in one of our
tenants (or a tenant of any entity which we own or control) that would cause us to own, directly or indirectly, more than a 9.8%
interest in such tenant. The person seeking an exemption must represent to the satisfaction of the board that it will not violate
these restrictions. The person also must agree that any violation or attempted violation of these restrictions will result in the
automatic transfer of the shares of stock causing the violation to the charitable trust.

 

Any attempted transfer of our Common Shares
that, if effective, would result in a violation of our ownership limits described above, our being “closely held” under
Section 856(h) of the Code or otherwise failing to qualify as a REIT, or in our Common Shares being beneficially owned by fewer
than 100 persons, will be null and void or will cause the number of Common Shares causing the violation to be automatically transferred
to a trust for the exclusive benefit of one or more charitable beneficiaries. The prohibited transferee will not acquire any rights
in the Common Shares. The automatic transfer will be deemed to be effective as of the close of business on the business day prior
to the date of the attempted transfer. We will designate a trustee of the trust that will not be affiliated with us or the prohibited
transferee. We also will name one or more charitable organizations as a beneficiary of the trust.

 

Common Shares held in trust will remain issued
and outstanding Common Shares and will be entitled to the same rights and privileges as all other Common Shares. The prohibited
transferee will not benefit economically from any of the Common Shares held in trust, will not have any rights to dividends or
other distributions and will not have the right to vote or any other rights attributable to the Common Shares held in the trust.
The trustee will receive all dividends and other distributions on the Common Shares held in trust and will hold such dividends
or other distributions in trust for the benefit of the charitable beneficiary. The trustee may vote any Common Shares held in the
trust. Subject to Maryland law, the trustee also will have the authority: (a) to rescind as void any vote cast by the prohibited
transferee prior to our discovery that the Common Shares have been transferred to the trust and, (b) to recast the vote in accordance
with the desires of the trustee acting for the benefit of the charitable beneficiary. However, if we have already taken irreversible
corporate action, then the trustee will not have the authority to rescind and recast the vote.

 

     

     

    

 

Within 20 days of receiving notice from us
that any of our Common Shares have been transferred to the trust for the charitable beneficiary, the trustee will sell those Common
Shares to a person designated by the trustee whose ownership of the Common Shares will not violate the above ownership limitations.
Upon the sale, the interest of the charitable beneficiary in the Common Shares sold will terminate and the trustee will distribute
the net proceeds of the sale to the prohibited transferee and to the charitable beneficiary as follows. The prohibited transferee
will receive an amount equal to the lesser of: (a) the price paid by the prohibited transferee for the Common Shares or, if the
prohibited transferee did not give value for the Common Shares in connection with the event causing the Common Shares to be held
in the trust (e.g., a gift, devise or other similar transaction), the market price (as defined in our charter) of the Common
Shares on the day of the event causing the Common Shares to be held in the trust and, (b) the price received by the trustee from
the sale or other disposition of the Common Shares. The trustee may reduce the amount payable to the prohibited transferee by the
amount of dividends and other distributions which have been paid to the prohibited transferee and are owed by the prohibited transferee
to the trustee. Any net sale proceeds in excess of the amount payable to the prohibited transferee will be paid immediately to
the charitable beneficiary. If, prior to our discovery that Common Shares have been transferred to the trust, the Common Shares
are sold by the prohibited transferee, then: (a) the Common Shares shall be deemed to have been sold on behalf of the trust; and
(b) to the extent that the prohibited transferee received an amount for the Common Shares that exceeds the amount he was entitled
to receive, the excess shall be paid to the trustee upon demand.

 

In addition, Common Shares held in the trust
for the charitable beneficiary will be deemed to have been offered for sale to us, or our designee, at a price per Common Share
equal to the lesser of: (a) the price per Common Share in the transaction that resulted in the transfer to the trust (or, in the
case of a devise or gift, the market price at the time of the devise or gift); and (b) the market price on the date we, or our
designee, accept the offer. We will have the right to accept the offer until the trustee has sold the Common Shares. Upon a sale
to us, the interest of the charitable beneficiary in the Common Shares sold will terminate and the trustee will distribute the
net proceeds of the sale to the prohibited transferee. We may reduce the amount payable to the prohibited transferee by the amount
of dividends and other distributions which have been paid to the prohibited transferee and are owed by the prohibited transferee
to the trustee. We may pay the amount of such reduction to the trustee for the benefit of the charitable beneficiary.

 

Any person who acquires Common Shares in
violation of the foregoing restrictions or who would have owned the Common Shares that were transferred to any such trust must
give us immediate written notice of such event, and any person who proposes or attempts to acquire or receive Common Shares in
violation of the foregoing restrictions must give us at least 15 days’ written notice prior to such transaction. In both
cases, such persons shall provide to us such other information as we may request in order to determine the effect, if any, of such
transfer on our status as a REIT.

 

The foregoing restrictions will continue
to apply until our board of directors determines it is no longer in our best interest to continue to qualify as a REIT or that
compliance is no longer required for REIT qualification. The ownership limits do not apply to any underwriter in an offering of
our shares or to a person or persons exempted from the ownership limits by our board of directors based upon appropriate assurances
that our qualification as a REIT would not be jeopardized and certain other representations and undertakings required by our charter.

 

Within 30 days after the end of each taxable
year, every owner of 5% or more of our outstanding capital stock will be asked to deliver to us a statement setting forth the number
of shares owned directly or indirectly by such person and a description of how such person holds the shares. Each such owner shall
also provide us with such additional information as we may request in order to determine the effect, if any, of his or her beneficial
ownership on our status as a REIT and to ensure compliance with our ownership limits.

 

These restrictions could delay, defer or
prevent a transaction or change in control of our company that might involve a premium price for our Common Shares or otherwise
be in the best interests of our stockholders.

 

Suitability Standards and Minimum Purchase Requirements

 

State securities laws and our charter require
that purchasers of our Common Shares meet standards regarding (a) net worth or income, and (b) minimum purchase amounts. Subsequent purchasers, i.e., potential
purchasers of your Common Shares, must also meet the net worth or income standards, and unless you are transferring all of your
Common Shares, you may not transfer your Common Shares in a manner that causes you or your transferee to own fewer than the number
of Common Shares required to meet the minimum purchase requirements, except for the following transfers without consideration:
transfers by gift; transfers by inheritance; intrafamily transfers; family dissolutions; transfers to affiliates; and transfers
by operation of law. These suitability and minimum purchase requirements are applicable until our Common Shares are listed on a
national securities exchange, and these requirements may make it more difficult for you to sell your Common Shares. We cannot assure
you that our Common Shares will ever be listed on a national securities exchange.

 

     

     

    

 

Distributions

 

We currently pay, and intend to continue
paying, regular monthly cash distributions to our stockholders. The actual amount and timing of distributions is be determined
by our board of directors, in its discretion, based on its analysis of our actual and expected earnings, cash flow, capital expenditures
and investments, as well as general financial conditions. The distributions that we currently pay are equal to a daily amount equal
to $0.00164383 based on a purchase price of $10.00 per share. We intend to continue paying distributions for future periods in
the amounts and at times as determined by our board.

 

Our board of directors does not intend to
fund our distributions with shares of our common stock. However, our board may have to consider such distributions if there is
a discrepancy between our taxable income and cash flow. It may be necessary to pay dividends in the form of stock dividends in
order to comply with the annual distribution requirements relating to our qualification as a REIT. These discrepancies may arise
in investments that result in taxable income without producing a corresponding amount of cash. Examples of this may include:

 

	 	•	“residual interest” in REMICs or taxable mortgage pools;

 

	 	•	loans or mortgage-backed securities held as assets that are issued at a discount and require the accrual of taxable economic interest in advance of receipt in cash;

 

	 	•	loans on which the borrower is permitted to defer cash payments of interest, distressed loans on which the issuer may be required to accrue taxable interest income even though the borrower is unable to make current servicing payments in cash, and debt securities purchased at a discount; and

 

	 	•	a market downturn, such as the one that occurred in 2008–2009, where a number of publicly traded REITs paid dividends consisting primarily of stock because their boards of directors had determined, in the exercise of their fiduciary duties, that preserving cash would best serve the interests of stockholders (this is consistent with private letter rulings issued by the IRS).

 

We expect to continue paying distributions
monthly unless our results of operations, our general financial condition, general economic conditions or other factors make it
imprudent to do so. The timing and amount of distributions will be determined by our board, in its sole discretion, may vary from
time to time, and will be influenced in part by its intention to comply with REIT requirements of the Code.

 

 Although stock dividends are permissible, distributions
in kind will not be permitted, except for distributions of readily marketable securities, distributions of beneficial interests
in a liquidating trust established for our dissolution and the liquidation of our assets in accordance with the terms of our charter
or distributions that meet all of the following conditions: (a) our board of directors advises each stockholder of the risks associated
with direct ownership of property; (b) our board of directors offers each stockholder the option of receiving such in-kind distribution;
and (c) in-kind distributions are only made to those stockholders who accept such an offer.

 

     

     

    

 

To maintain our qualification as a REIT,
we must make aggregate annual distributions to our stockholders of at least 90% of our REIT taxable income (which does not equal
net income, as calculated in accordance with GAAP), determined without regard to the deduction for dividends paid and excluding
net capital gain. If we meet the REIT qualification requirements, we generally will not be subject to U.S. federal income tax on
that portion of our taxable income or capital gain which is distributed to our stockholders. We expect
that our board of directors will authorize distributions in excess of those required for us to maintain REIT status depending on
our financial condition and such other factors as our board of directors deems relevant.

 

Each distribution will be accompanied by
a notice which sets forth: (a) the record date; (b) the amount per Common Share that will be distributed; and (c) the equivalent
annualized yield. Maryland investors also will receive notices showing (x) the amount and percentage of each distribution paid
from operations, offering proceeds and other sources; and (y) the aggregate amount of such distribution.

 

We have not established a minimum distribution
level, and our charter does not require that we make distributions to our stockholders.

 

Inspection of Books and Records

 

As a part of our books and corporate
records, we will maintain at our principal office an alphabetical list of the names of our holders of Common Shares, along
with their addresses and telephone numbers and the number of Common Shares held by each of them. The copy of the list of
holders of our Common Shares shall be printed in alphabetical order, on white paper, and in a readily readable type size (in
no event smaller than 10-point type). We will update this stockholder list at least quarterly. Except as noted below, we will
make the list available for inspection at our principal office by a holder of Common Shares or his or her designated agent
upon request of the stockholder and also will mail this list to any holder of Common Shares within 10 days of receipt of his
or her request. We may impose a reasonable charge for expenses incurred in reproducing such list. Stockholders, however, may
not sell or use this list for commercial purposes. The purposes for which stockholders may request this list include matters
relating to their voting rights and the exercise of stockholder rights under the federal proxy laws.

 

If our advisor or our board of directors
neglects or refuses to exhibit, produce or mail a copy of the list of holders of Common Shares as requested, our advisor or our
board of directors, as the case may be, shall be liable to the stockholder requesting the list for the costs, including attorneys’
fees, incurred by any holder of Common Shares for compelling the production of the stockholder list and any actual damages suffered
by the stockholder for the neglect or refusal to produce the list. It shall be a defense that the actual purpose and reason for
the requests for inspection or for a copy of the stockholder list is not for a proper purpose but is instead for the purpose of
securing such list of stockholders or other information for the purpose of selling such list or copies thereof, or of using the
same for a commercial purpose other than in the interest of the applicant as a stockholder relative to the affairs of our company.
We may require that the stockholder requesting the stockholder list represent that the request is not for a commercial purpose
unrelated to the stockholder’s interest in our company. The remedies provided by our charter to stockholders requesting copies
of the stockholder list are in addition to, and do not in any way limit, other remedies available to stockholders under federal
law, or the law of any state.

 

Business Combinations

 

Under the Maryland General Corporation Law,
business combinations between a Maryland corporation and an interested stockholder or the interested stockholder’s affiliate
are prohibited for five years after the most recent date on which the stockholder becomes an interested stockholder. For this purpose,
the term “business combination” includes mergers, consolidations, share exchanges, and, in circumstances specified
in the statute, asset transfers and issuances or reclassifications of equity securities. An “interested stockholder”
is defined for this purpose as: (a) any person who beneficially owns, directly or indirectly, ten percent or more of the voting
power of the corporation’s outstanding voting stock; or (b) an affiliate or associate of the corporation who, at any time
within the two-year period prior to the date in question, was the beneficial owner, directly or indirectly, of ten percent or more
of the voting power of the then outstanding stock of the corporation. A person is not an interested stockholder under the statute
if the board of directors approved in advance the transaction by which he otherwise would have become an interested stockholder.
However, in approving a transaction, the board of directors may provide that its approval is subject to compliance, at or after
the time of approval, with any terms and conditions determined by the board.

 

     

     

    

 

After the five-year prohibition, any business
combination between the corporation and an interested stockholder generally must be recommended by the board of directors of the
corporation and approved by the affirmative vote of at least: (a) 80% of the votes entitled to be cast by holders of outstanding
voting stock of the corporation, voting together as a single voting group; and (b) two-thirds of the votes entitled to be cast
by holders of voting stock of the corporation other than shares held by the interested stockholder or its affiliate with whom the
business combination is to be effected, or held by an affiliate or associate of the interested stockholder, voting together as
a single voting group.

 

These supermajority vote requirements do
not apply if the holders of Common Shares receive a minimum price, as defined under the Maryland General Corporation Law, for their
shares in the form of cash or other consideration in the same form as previously paid by the interested stockholder for its shares.

 

None of these provisions of the Maryland
General Corporation Law will apply, however, to business combinations that are approved or exempted by our board of directors prior
to the time that the interested stockholder becomes an interested stockholder. Our board, by resolution, has exempted any business
combinations involving us and The Lightstone Group or any of its affiliates from these provisions. As a result, the five-year prohibition
and the supermajority vote requirement will not apply to any business combinations between any affiliate of The Lightstone Group
and us. As a result, any affiliate of The Lightstone Group may be able to enter into business combinations with us, which may or
may not be in the best interests of our stockholders.

 

Control Share Acquisitions

 

The Maryland General Corporation Law provides
that control shares of a Maryland corporation acquired in a control share acquisition have no voting rights except to the extent
approved by the affirmative vote of stockholders entitled to cast two-thirds of the votes entitled to be cast on the matter. Shares
owned by the acquirer, an officer of the corporation or an employee of the corporation who is also a director of the corporation
are excluded from the vote on whether to accord voting rights to the control shares. “Control shares” are voting shares
that, if aggregated with all other shares owned by the acquirer or with respect to which the acquirer has the right to vote or
to direct the voting of, other than solely by virtue of revocable proxy, would entitle the acquirer to exercise voting power in
electing directors within one of the following ranges of voting power:

 

	 	•	one-tenth or more but less than one-third;

 

	 	•	one-third or more but less than a majority; or

 

	 	•	a majority or more of all voting power.

 

Control shares do not include shares the
acquiring person is then entitled to vote as a result of having previously obtained stockholder approval or shares acquired directly
from the corporation. Except as otherwise specified in the statute, a “control share acquisition” means the acquisition
of issued and outstanding control shares.

 

Once a person who has made or proposes to
make a control share acquisition has undertaken to pay expenses and has satisfied other required conditions, the person may compel
the board of directors to call a special meeting of stockholders to be held within 50 days of the demand to consider the voting
rights of the shares. If no request for a meeting is made, the corporation may itself present the question at any stockholders
meeting.

 

If voting rights are not approved for the
control shares at the meeting or if the acquiring person does not deliver an “acquiring person statement” for the control
shares as required by the statute, the corporation may redeem any or all the control shares for their fair value, except for control
shares for which voting rights have previously been approved. Fair value is to be determined for this purpose without regard to
the absence of voting rights for the control shares, and is to be determined as of the date of the last control share acquisition
or of any meeting of stockholders at which the voting rights for control shares are considered and not approved.

 

     

     

    

 

If voting rights for control shares are approved
at a stockholders meeting and the acquirer becomes entitled to vote a majority of the shares entitled to vote, all other stockholders
may exercise appraisal rights. The fair value of the shares as determined for purposes of these appraisal rights may not be less
than the highest price per Common Share paid in the control share acquisition. Some of the limitations and restrictions otherwise
applicable to the exercise of dissenters’ rights do not apply in the context of a control share acquisition.

 

The control share acquisition statute does
not apply to shares acquired in a merger, consolidation or share exchange if the corporation is a party to the transaction or to
acquisitions approved or exempted by the charter or bylaws of the corporation.

 

Our bylaws contain a provision exempting
from the control share acquisition statute any and all acquisitions by any person of shares of our stock. There can be no assurance
that this provision will not be amended or eliminated at any time in the future.

 

Subtitle 8

 

Subtitle 8 of Title 3 of the Maryland General
Corporation Law, or Subtitle 8, permits a Maryland corporation with a class of equity securities registered under the Exchange
Act and at least three independent directors to elect to be subject, by provision in its charter or bylaws or a resolution of its
board of directors and notwithstanding any contrary provision in the charter or bylaws, to any or all of five provisions:

 

	 	•	a classified board;

 

	 	•	a two-thirds vote requirement for removing a director;

 

	 	•	a requirement that the number of directors be fixed only by vote of the directors;

 

	 	•	a requirement that a vacancy on the board be filled only by the remaining directors and (if the board is classified) for the remainder of the full term of the directorship in which the vacancy occurred; and

 

	 	•	a majority requirement for the calling of a stockholder-requested special meeting of stockholders.

 

Pursuant to Subtitle 8, except as may be
provided by our board of directors in setting the terms of any class or series of our preferred stock, we have elected to provide
that vacancies on our board of directors be filled only by the remaining directors and for the remainder of the full term of the
directorship in which the vacancy occurred. Although our board has no current intention to opt in to any of the other above provisions
permitted under Maryland law, our charter does not prohibit our board from doing so. Becoming governed by any of these provisions
could discourage an extraordinary transaction (such as a merger, tender offer or sale of all or substantially all of our assets)
that might provide a premium price for holders of our securities. Note that through provisions in our charter and bylaws unrelated
to Subtitle 8, we already vest in our board of directors the exclusive power to fix the number of directors, provided that the
number is at least three.

 

Tender Offers

 

Our charter provides that any tender offer
made by any person, including any “mini-tender” offer, must comply with certain notice and disclosure requirements.
These procedural requirements with respect to tender offers apply to any widespread solicitation for shares of our stock at firm
prices for a limited time period.

 

In order for any person to conduct a tender
offer for shares of our stock, our charter requires that the person comply with all the provisions of Regulation 14D of the Exchange
Act (other than filing requirements) and provide the company notice of such tender offer at least 10 business days before initiating
the tender offer. Regulation 14D requires any person initiating a tender offer to provide:

 

	 	•	specific disclosure to stockholders focusing on the terms of the offer and information about the bidder;

 

	 	•	the ability to allow stockholders to withdraw tendered shares while the offer remains open;

 

	 	•	the right to have tendered shares accepted on a pro rata basis throughout the term of the offer if the offer is for less than all of our shares; and

 

	 	•	for the equal treatment of all stockholders of the subject class of shares.

 

In addition to the foregoing, there are certain
ramifications to any person who attempts to conduct a noncompliant tender offer. A stockholder may not transfer any shares to any
person who initiates a tender offer without complying with the provisions set forth above unless such stockholder first offers
such shares to us at a price equal to the greater of the price in the non-complaint tender offer or the repurchase price under
our share repurchase program as it is in effect at such time. The noncomplying person shall also be responsible for all our expenses
in connection with that person’s noncompliance.

 

     

     

    

 

Registrar and Transfer Agent

 

We will engage a third party to serve as
the registrar and transfer agent for our Common Shares. The name and address of our transfer agent is as follows:

 

DST Systems, Inc.

430 West 7th St.

Kansas City, Missouri 64105

Phone: (877) 304-4733

Fax: (855) 368-2326

 

To ensure that any account changes are made
promptly and accurately, all changes (including your address, ownership type and distribution mailing address) should be directed
to the transfer agent.

 

     

     

    

Restrictions on Roll-Up Transactions

 

A Roll-up Transaction is a transaction involving
the acquisition, merger, conversion or consolidation, directly or indirectly, of us and the issuance of securities of an entity
that is created or would survive after the successful completion of a Roll-up Transaction, which we refer to as a Roll-up Entity.
This term does not include:

 

	 	•	a transaction involving securities of a company that have been listed on a national securities exchange for at least 12 months; or

 

	 	•	a transaction involving our conversion to corporate, trust or association form if, as a consequence of the transaction, there will be no significant adverse change in stockholder voting rights, the term of our existence, compensation to our sponsor or advisor or our investment objectives.

 

In connection with any proposed Roll-up Transaction,
an appraisal of all our assets will be obtained from a competent independent appraiser. Our assets will be appraised on a consistent
basis, and the appraisal will be based on an evaluation of all relevant information and will indicate the value of our assets as
of a date immediately preceding the announcement of the proposed Roll-up Transaction. If the appraisal will be included in a prospectus
used to offer the securities of a Roll-Up Entity, the appraisal will be filed with the SEC and, if applicable, the states in which
registration of such securities is sought, as an exhibit to the registration statement for the offering. Accordingly, an issuer
using the appraisal shall be subject to liability for violation of Section 11 of the Securities Act and comparable provisions under
state laws for any material misrepresentations or material omissions in the appraisal. The appraisal will assume an orderly liquidation
of assets over a 12-month period. The terms of the engagement of the independent appraiser will clearly state that the engagement
is for our benefit and the benefit of our stockholders. A summary of the appraisal, indicating all material assumptions underlying
the appraisal, will be included in a report to our stockholders in connection with any proposed Roll-up Transaction.

 

In connection with a proposed Roll-up Transaction,
the person sponsoring the Roll-up Transaction must offer to our holders of Common Shares who vote “no” on the proposal
the choice of:

 

	 	(a)	accepting the securities of the Roll-up Entity offered in the proposed Roll-up Transaction; or

 

	 	(b)	one of the following:

 

	 	(i)	remaining as stockholders of us and preserving their interests in us on the same terms and conditions as existed previously; or

 

	 	(ii)	receiving cash in an amount equal to the stockholders’ pro rata share of the appraised value of our net assets.

 

We are prohibited from participating in any
proposed Roll-up Transaction:

 

	 	•	that would result in our holders of Common Shares having voting rights in a Roll-up Entity that are less than those provided in our charter and bylaws, including rights with respect to the election and removal of directors, annual reports, annual and special meetings of stockholders, the amendment of our charter and our dissolution;

 

	 	•	that includes provisions that would operate to materially impede or frustrate the accumulation of shares by any purchaser of the securities of the Roll-up Entity, except to the minimum extent necessary to preserve the tax status of the Roll-up Entity, or that would limit the ability of an investor to exercise the voting rights of its securities of the Roll-up Entity on the basis of the number of shares held by that investor;

 

	 	•	in which investors’ rights of access to the records of the Roll-up Entity would be less than those provided in our charter; or

 

	 	•	in which any of the costs of the Roll-up Transaction would be borne by us if the Roll-up Transaction is rejected by holders of our Common Shares.Exhibit

Exhibit 4.1

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

As of December 31, 2019, Morgan Stanley Direct Lending Fund (“we,” “our,” or the “Company”) had one class of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”): our common stock, par value $0.001 per share (the “Common Stock”). Capitalized terms used but not defined herein shall have the meaning ascribed to them in the Annual Report on Form 10-K to which this Description of Securities is attached as an exhibit (the “Form 10-K”). 

The following description is based on relevant portions of the Delaware General Corporation Law (the “DGCL”), our certificate of incorporation and our bylaws. This summary is a description of the material terms of, and is qualified in its entirety by, our certificate of incorporation and bylaws, each of which is incorporated by reference as an exhibit to the Form 10-K, and may not contain all of the information that is important to you. We refer you to the DGCL and our certificate of incorporation and bylaws for a more detailed description of the provisions summarized below.
Our authorized stock consists of 100,000,000 shares of Common Stock, par value $0.001 per share, and 1,000,000 shares of preferred stock, par value $0.001 per share. There is currently no market for shares of our Common Stock, and we can offer no assurance that a market for shares of our Common Stock will develop in the future. There are no outstanding options or warrants to purchase shares of our Common Stock. No stock has been authorized for issuance under any equity compensation plan. Under Delaware law, our stockholders generally are not personally liable for our debts or obligations.
Under our certificate of incorporation, our Board of Directors is authorized to classify and reclassify any unissued shares of stock into other classes or series of stock and authorize the issuance of shares of stock without obtaining stockholder approval. As permitted by the DGCL, our certificate of incorporation provides that the Board of Directors, without any action by our stockholders, may amend the certificate of incorporation from time to time to increase or decrease the aggregate number of shares of stock or the number of shares of stock of any class or series that we have authority to issue.
     All shares of our Common Stock have equal rights as to earnings, assets, dividends and other distributions and voting and, when they are issued, will be duly authorized, validly issued, fully paid and nonassessable. Distributions may be paid to the holders of our Common Stock if, as and when authorized by our Board of Directors and declared by us out of assets legally available therefor. Shares of our Common Stock have no preemptive, exchange, conversion or redemption rights and are freely transferable, except when their transfer is restricted by federal and state securities laws or by contract. In the event of our liquidation, dissolution or winding up, each share of our Common Stock would be entitled to share ratably in all of our assets that are legally available for distribution after we pay all debts and other liabilities and subject to any preferential rights of holders of our preferred stock, if any preferred stock is outstanding at such time. Each share of our Common Stock is entitled to one vote on all matters submitted to a vote of stockholders, including the election of directors. Except as provided with respect to any other class or series of stock, the holders of our Common Stock possess exclusive voting power. There is no cumulative voting in the election of 

directors, which means that holders of a majority of the outstanding shares of Common Stock can elect all of our directors, and holders of less than a majority of such shares are not be able to elect any directors.
Transfer and Resale Restrictions
            We intend to sell shares of our Common Stock in private offerings in the United States under the exemption provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”) and Regulation D promulgated thereunder, Regulation S under the Securities Act and other exemptions from the registration requirements of the Securities Act. Investors who acquire shares of Common Stock in such private offerings are required to complete, execute and deliver a subscription agreement (“Subscription Agreement”) and related documentation, which includes customary representations and warranties, certain covenants and restrictions and indemnification provisions. Additionally, such investors may be required to provide due diligence information to us for compliance with certain legal requirements. We may, from time to time, engage offering or distribution agents and incur offering or distribution fees or sales commissions in connection with any private offerings of shares of our Common Stock in certain jurisdictions outside the United States. The cost of any such offering or distribution fees may be borne by an affiliate of MS Capital Partners Adviser Inc., our investment adviser (the “Adviser”). We will not incur any such fees or commissions if our net proceeds received upon a sale of shares of our Common Stock after such costs would be less than the net asset value per share.
            Prior to any quotation or listing of our securities on a national securities exchange, including through an initial public offering (an “Exchange Listing”), or other liquidity event, no transfer of our investors’ Capital Commitments or all or any portion of our investors’ shares of Common Stock may be made without (a) registration of the transfer on our books and (b) our prior written consent, which may be given or withheld in our sole discretion for any or no reason. In any event, our consent may be withheld including, without limitation (1) if the creditworthiness of the proposed transferee, as determined by us in our sole discretion, is not sufficient to satisfy all obligations under the Subscription Agreement or (2) unless, in the opinion of counsel (who may be counsel for the Company) satisfactory in form and substance to us:
		
	•
	such transfer would not violate the Securities Act or any state (or other jurisdiction) securities or “blue sky” laws applicable to us or the shares to be transferred; and

		
	•
	in the case of a transfer to: 

		
	o
	an “employee benefit plan” as defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), that is subject to the fiduciary responsibility provisions of Title I of ERISA;

		
	o
	a “plan” described in Section 4975(e)(1) of the Internal Revenue Code of 1986, as amended (the “Code”), that is subject to Section 4975 of the Code;

		
	o
	an entity that is, or is deemed to be, using (for purposes of ERISA or Section 4975 of the Code) “plan assets” to purchase or hold its investments; or

		
	o
	a person (including an entity) that has discretionary authority or control with respect to our assets or a person who provides investment advice with respect to our assets or an “affiliate” of such person, such transfer would not be a non-exempt “prohibited transaction” under ERISA or Section 4975 of the Code or cause all or any portion of our assets to constitute “plan assets” under ERISA or Section 4975 of the Code.

Any person that acquires all or any portion of the shares of our Common Stock of an investor in a transfer permitted under the Subscription Agreement is obligated to pay to us the appropriate portion of any amounts thereafter becoming due in respect of the Capital Commitment committed to be made by its predecessor in interest. Notwithstanding the transfer of all or any fraction of its shares of Common Stock, as between an investor and us, the investor will remain liable for their Capital Commitments prior to the time, if any, when the purchaser, assignee or transferee of such shares, or fraction thereof, becomes a holder of such shares.
Furthermore, should there be an Exchange Listing, our stockholders will be subject to a lock-up restriction pursuant to which they will be prohibited from selling or otherwise transferring shares of our Common Stock for a certain period after the date of such event. The specific terms of such restriction and any other limitations on the sale of shares of our Common Stock in connection with or following an Exchange Listing will be agreed in advance between our Board of Directors and the Adviser, acting on behalf of our stockholders, and the institutions acting as the underwriters or market makers, acting on our behalf, in connection with such Exchange Listing. There can be no assurance that shares of our Common Stock will be listed on a national securities exchange or offered in an initial public offering.
Provisions of the DGCL and Our Certificate of Incorporation and Bylaws
Limitation on Liability of Directors and Officers; Indemnification and Advance of Expenses
            The indemnification of our officers and directors is governed by Section 145 of the DGCL, our certificate of incorporation and bylaws. Subsection (a) of DGCL Section 145 empowers a corporation to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such action, suit or proceeding if (1) such person acted in good faith, (2) in a manner such person reasonably believed to be in or not opposed to the best interests of the corporation and (3) with respect to any criminal action or proceeding, such person had no reasonable cause to believe the person’s conduct was unlawful.
           Subsection (b) of DGCL Section 145 empowers a corporation to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with the defense or settlement of such action or suit if such person acted in good faith and in a manner the person reasonably believed to be in, or not opposed to, the best interests of the corporation, and except that no indemnification may be made in respect of any claim, issue or matter as to which such person has been adjudged to be liable to the corporation unless and only to the extent that the Delaware Court of Chancery or the court in which such action or suit was brought determines upon application that, despite the 

adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court deems proper.
            DGCL Section 145 further provides that to the extent that a present or former director or officer is successful, on the merits or otherwise, in the defense of any action, suit or proceeding referred to in subsections (a) and (b) of Section 145, or in defense of any claim, issue or matter therein, such person will be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with such action, suit or proceeding. In all cases in which indemnification is permitted under subsections (a) and (b) of Section 145 (unless ordered by a court), it will be made by the corporation only as authorized in the specific case upon a determination that indemnification of the present or former director, officer, employee or agent is proper in the circumstances because the applicable standard of conduct has been met by the party to be indemnified. Such determination must be made, with respect to a person who is a director or officer at the time of such determination, (1) by a majority vote of the directors who are not parties to such action, suit or proceeding, even though less than a quorum, (2) by a committee of such directors designated by majority vote of such directors, even though less than a quorum, (3) if there are no such directors, or if such directors so direct, by independent legal counsel in a written opinion or (4) by the stockholders. The statute authorizes the corporation to pay expenses incurred by an officer or director in advance of the final disposition of a proceeding upon receipt of an undertaking by or on behalf of the person to whom the advance will be made, to repay the advances if it is ultimately determined that he or she was not entitled to indemnification. DGCL Section 145 also provides that indemnification and advancement of expenses permitted under such Section are not to be exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under any bylaw, agreement, vote of stockholders or disinterested directors, or otherwise. DGCL Section 145 also authorizes the corporation to purchase and maintain liability insurance on behalf of its directors, officers, employees and agents regardless of whether the corporation would have the statutory power to indemnify such persons against the liabilities insured.
            Our certificate of incorporation provides that our directors will not be liable to us or our stockholders for monetary damages for breach of fiduciary duty as a director to the fullest extent permitted by the current DGCL or as the DGCL may be amended. DGCL Section 102(b)(7) provides that the personal liability of a director to a corporation or its stockholders for breach of fiduciary duty as a director may be eliminated except for liability (1) for any breach of the director’s duty of loyalty to the registrant or its stockholders, (2) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (3) under Section 174 of the DGCL, relating to unlawful payment of dividends or unlawful stock purchases or redemption of stock or (4) for any transaction from which the director derives an improper personal benefit.
            Our bylaws provide for the indemnification of any person to the full extent permitted, and in the manner provided, by the current DGCL or as the DGCL may be amended. In addition, we have entered into indemnification agreements with each of our directors in order to effect the foregoing except to the extent that such indemnification would exceed the limitations on indemnification under section 17(h) of the 1940 Act.
            As a business development company, we are not permitted to and will not indemnify the Adviser, any of our executive officers and directors, or any other person against liability arising 

from willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of such person’s office, or by reason of reckless disregard of obligations and duties of such person arising under contract or agreement.
Election of Directors
            Our bylaws provide that the affirmative vote of a majority of the total votes cast “for” or “against” a nominee for director at a duly called meeting of stockholders at which a quorum is present is required to elect a director in an uncontested election. In a contested election, directors are elected by a plurality of the votes cast at a meeting of stockholders duly called and at which is a quorum is present. Under our bylaws, our Board of Directors may amend the bylaws to alter the vote required to elect directors.
Classified Board of Directors
            Our Board of Directors is divided into three classes of directors serving staggered three-year terms, with the term of office of only one of the three classes expiring each year. At each annual meeting of stockholders, directors of the class of directors whose term expires at such meeting will be elected to hold office for a term expiring at the third succeeding annual meeting of stockholders following the meeting at which they were elected and until their successors are duly elected and qualified. A classified Board of Directors may render a change in control of us or removal of our incumbent management more difficult. We believe, however, that the longer time required to elect a majority of a classified Board of Directors helps to ensure the continuity and stability of our management and policies.
Number of Directors; Removal; Vacancies
            Our certificate of incorporation and bylaws provide that the number of directors will be set only by the Board of Directors. Our bylaws provide that a majority of our entire Board of Directors may at any time increase or decrease the number of directors. However, unless our bylaws are amended, the number of directors may never be less than the minimum number required by the DGCL. Under the DGCL, unless the certificate of incorporation provides otherwise (which our certificate of incorporation does not), directors on a classified board such as our Board of Directors may be removed only for cause. Under our certificate of incorporation and bylaws, any vacancy on the Board of Directors, including a vacancy resulting from an enlargement of the Board of Directors, may be filled only by vote of a majority of the directors then in office. The limitations on the ability of our stockholders to remove directors and fill vacancies could make it more difficult for a third-party to acquire, or discourage a third-party from seeking to acquire, control of us.
Action by Stockholders
            Our certificate of incorporation provides that stockholder action can be taken only at an annual or special meeting of stockholders or by unanimous written consent in lieu of a meeting. This may have the effect of delaying consideration of a stockholder proposal until the next annual meeting.
Advance Notice Provisions for Stockholder Nominations and Stockholder Proposals
            Our bylaws provide that with respect to an annual meeting of stockholders, nominations of persons for election to the Board of Directors and the proposal of business to be considered by stockholders may be made only (1) by or at the direction of the Board of Directors, (2) pursuant to 

our notice of meeting or (3) by a stockholder who was a stockholder of record at the time of provision of notice, at the record date and at the time of the meeting, who is entitled to vote at the meeting and who has complied with the advance notice procedures of the bylaws. With respect to special meetings of stockholders, only the business specified in our notice of the meeting may be brought before the meeting. Nominations of persons for election to the Board of Directors at a special meeting may be made only (1) by or at the direction of the Board of Directors or (2) provided that the special meeting has been called in accordance with our bylaws for the purposes of electing directors, by a stockholder who was a stockholder of record at the time of provision of notice, at the record date and at the time of the meeting, who is entitled to vote at the meeting and who has complied with the advance notice provisions of the bylaws.
            The purpose of requiring stockholders to give us advance notice of nominations and other business is to afford our Board of Directors a meaningful opportunity to consider the qualifications of the proposed nominees and the advisability of any other proposed business and, to the extent deemed necessary or desirable by our Board of Directors, to inform stockholders and make recommendations about such qualifications or business, as well as to provide a more orderly procedure for conducting meetings of stockholders. Although our bylaws do not give our Board of Directors any power to disapprove stockholder nominations for the election of directors or proposals recommending certain action, they may have the effect of precluding a contest for the election of directors or the consideration of stockholder proposals if proper procedures are not followed and of discouraging or deterring a third party from conducting a solicitation of proxies to elect its own slate of directors or to approve its own proposal without regard to whether consideration of such nominees or proposals might be harmful or beneficial to us and our stockholders.
Calling of Special Meetings of Stockholders
            Our bylaws provide that special meetings of stockholders may be called by our Board of Directors and certain of our officers. Additionally, our bylaws provide that, subject to the satisfaction of certain procedural and informational requirements by the stockholders requesting the meeting, a special meeting of stockholders will be called by the secretary of the corporation upon the written request of stockholders entitled to cast not less than a majority of all the votes entitled to be cast at such meeting.
Delaware Anti-Takeover Law
            The DGCL contains provisions that could make it more difficult for a potential acquirer to acquire us by means of a tender offer, proxy contest or otherwise. These provisions are expected to discourage certain coercive takeover practices and inadequate takeover bids and to encourage persons seeking to acquire control of us to negotiate first with our Board of Directors. These measures may delay, defer or prevent a transaction or a change in control that might otherwise be in the best interests of our stockholders. We believe, however, that the benefits of these provisions outweigh the potential disadvantages of discouraging any such acquisition proposals because the negotiation of such proposals may improve their terms.
            We are subject to the provisions of Section 203 of the DGCL regulating corporate takeovers. In general, these provisions prohibit a Delaware corporation from engaging in any business combination with any interested stockholder for a period of three years following the date that the stockholder became an interested stockholder, unless:

		
	•
	prior to such time, the board of directors approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;

		
	•
	upon consummation of the transaction that resulted in the stockholder 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; or

		
	•
	at or subsequent to such time, the business combination is approved by the board of directors and authorized at a meeting of stockholders, by at least two-thirds of the outstanding voting stock that is not owned by the interested stockholder.

            Section 203 of the DGCL defines “business combination” to include the following:
		
	•
	any merger or consolidation involving the corporation and the interested stockholder;

		
	•
	any sale, transfer, pledge or other disposition (in one transaction or a series of transactions) of 10% or more of either the aggregate market value of all the assets of the corporation or the aggregate market value of all the outstanding stock of the corporation involving the interested stockholder;

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

		
	•
	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 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 of the DGCL defines an interested stockholder as any 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 any of these entities or persons.
            The statute could prohibit or delay mergers or other takeover or change in control attempts and, accordingly, may discourage attempts to acquire us.
            Our Board of Directors will adopt a resolution exempting from Section 203 of the DGCL any business combination between us and any other person, subject to prior approval of such business combination by our Board of Directors, including approval by a majority of our independent directors.
Conflict with 1940 Act
            Our bylaws provide that, if and to the extent that any provision of the DGCL or any provision of our certificate of incorporation or bylaws conflicts with any provision of the 1940 Act, the applicable provision of the 1940 Act will control.
Exclusive Forum
            Our certificate of incorporation and bylaws provide that, to the fullest extent permitted by law, unless we consent in writing to the selection of an alternative forum, the sole and exclusive forum for (1) any derivative action or proceeding brought on behalf of the Company, (2) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of the Company to the Company or the Company’s stockholders, (3) any action asserting a claim arising pursuant to any provision of the DGCL, our certificate of incorporation or bylaws or the securities, antifraud, unfair trade practices or similar laws of any international, national, state, 

provincial, territorial, local or other governmental or regulatory authority, including, in each case, the applicable rules and regulations promulgated thereunder, or (4) any action asserting a claim governed by the internal affairs doctrine will be a federal or state court located in the state of Delaware. Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock will be deemed, to the fullest extent permitted by law, to have notice of and consented to these exclusive forum provisions and to have irrevocably submitted to, and waived any objection to, the exclusive jurisdiction of such courts in connection with any such action or proceeding and consented to process being served in any such action or proceeding, without limitation, by U.S. mail addressed to the stockholder at the stockholder’s address as it appears on the records of the Company, with postage thereon prepaid.

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