Document:

bcpl-ex41_283.htm

 

Exhibit 4.1

Form of Subscription Documents for

BC PARTNERS LENDING CORPORATION

(FOR U.S. ENTITY INVESTORS)

(INCLUDING TRUSTS, FIDUCIARIES, IRAS, etc.)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BC Partners Lending Corporation

DIRECTIONS FOR THE COMPLETION 
OF THE SUBSCRIPTION DOCUMENTS

Prospective investors must complete the Subscription Agreement (the “Subscription Agreement”), the Investor Questionnaire (the “Investor Questionnaire”) and any necessary attachments (the Subscription Agreement, the Investor Questionnaire and all such attachments collectively, the “Subscription Documents”) contained in this package in the manner described below.  Capitalized terms not defined herein are used as defined in the Confidential Private Placement Memorandum of BC Partners Lending Corporation. For purposes of these Subscription Documents, the “Investor” is the person or entity for whose account the shares of common stock of the Company (the “Shares”) are being purchased and that can make the representations and warranties set forth in the Subscription Documents.  Another person or entity with investment authority may execute the Subscription Documents on behalf of the Investor, but should indicate the capacity in which it is doing so and the name of the Investor.

In addition to the information requested in the Investor Questionnaire, each Investor should submit: 

	
 
	
1.
	
Tax Forms:

	
 
	
a.
	
Each Investor should fill in, sign and date a Form W-9 in accordance with the instructions to the Form. See Exhibit [  ]  to the Subscription Documents. 

	
 
	
2.
	
Customer Identification Program – Documentation Requirements:

	
 
	
a.
	
Formation:

Organized entities, including corporations, partnerships, limited liability companies, and trusts:  provide a certificate of formation and formation agreement.

	
 
	
b.
	
Identification:

Corporations, partnerships, limited liability companies, and trusts:  provide a list of natural persons who ultimately, directly or indirectly, benefit from 10% or more of the proceeds of the entity or hold 10% or more of the control rights.

	
 
	
3.
	
Evidence of Authorization:

Each Investor must provide satisfactory evidence of authorization, such as a list of authorized agents.

	
 
	
(a)
	
For Corporations:

Generally, Investors which are corporations must submit certified corporate resolutions authorizing the subscription and identifying the corporate officer empowered to sign the Subscription Documents.  Corporations must also provide a copy of the certificate of incorporation, or other information identifying the place of incorporation.

	
 
	
(b)
	
For Partnerships: 

Partnerships must submit a certified copy of the partnership certificate (in the case of limited partnerships) or partnership agreement identifying the general partners (empowered to sign the Subscription Documents and resolutions authorizing the subscriptions).

 

BC Partners Lending Corporation

	
 
	
(c)
	
For Limited Liability Companies:

Limited liability companies must submit a copy of their operating agreement identifying the manager or managing member, as applicable, empowered to sign the Subscription Documents and resolutions authorizing the subscription.  Limited liability companies must also provide a copy of the certificate of formation, or other information identifying the place of formation or incorporation.

	
 
	
(d)
	
For Trusts:

Trusts must submit a copy of the trust agreement and resolutions authorizing the subscription.  

	
 
	
(e)
	
For Employee Benefit Plans:

Employee benefit plans must submit a certificate of an appropriate officer certifying that the subscription has been authorized and identifying the individual empowered to sign the Subscription Documents.

	
 
	
(f)
	
For Governmental Plans:

Governmental plans must submit a certificate or similar documentation of an appropriate officer certifying that the subscription has been authorized and identifying the individual empowered to sign the Subscription Documents.

Investors may be requested to furnish other or additional documentation evidencing the authority to invest in the Company. The Company may waive any of the foregoing in its sole discretion. 

	
 
	
2.
	
Source of Funds

Each Investor must submit a record of the source of the funds with which the Investor is purchasing Shares of the Company.  Examples of an acceptable record of source of funds may include: (i) the first page of the Investor’s bank statement or (ii) an email certification from the Investor indicating (x) the nature of an Investor’s business and (y) the source of the Investor’s funds. 

Investors may be requested to furnish other or additional documentation evidencing the source of funds used to invest in the Company. 

	
 
	
3.
	
Financial Advisor Information

If a financial advisor is authorized to act on behalf of an Investor’s account, please sign and complete Exhibit [  ]  to the Subscription Documents.

	
 
	
4.
	
Delivery of Subscription Documents:

Please send a PDF copy of the completed and signed agreements and documentation noted above by electronic mail to [  ] as soon as possible.

 

BC Partners Lending Corporation

Inquiries regarding subscription procedures should be directed to [  ], of Simpson Thacher & Bartlett LLP or [  ]  of BC Partners Advisors, L.P. If the Investor Questionnaire indicates that any Investor’s response to a question requires further information, such Investor should contact [  ] at Simpson Thacher & Bartlett LLP as soon as possible.

If the Investor’s subscription is accepted by the Company (in whole or in part), a fully executed set of the Subscription Documents will be returned to the Investor.

***

 

 

BC Partners Lending Corporation

 

 

SUBSCRIPTION AGREEMENT

BC Partners Lending Corporation 

c/o [  ]

650 Madison Avenue 
New York, New York 10022

 

Ladies and Gentlemen:

 

1.   Subscription.

(a)The undersigned (the “Investor”) hereby subscribes for and agrees to acquire shares of common stock, par value $0.001 per share (“Shares”) of  BC Partners Lending Corporation, a Maryland corporation (“BCPL,” the “Company,” “we,” “our” or “us”) with an aggregate capital commitment (“Capital Commitment”) as set forth on the signature page to this Subscription Agreement (the “Subscription Agreement”). The Investor acknowledges that this application to subscribe for Shares is irrevocable on behalf of the Investor, is conditioned upon acceptance by or on behalf of the Company and  may be accepted or rejected (in whole or in part) by the Company in its sole discretion.  The Investor has read, acknowledges and is aware of all the terms and provisions of the Company’s Confidential Private Placement Memorandum, as amended, restated and/or supplemented from time to time (the “Memorandum”), the Company’s Articles of Amendment and Restatement attached hereto as Appendix [  ], as amended from time to time (the “Charter”), the Company’s Bylaws attached hereto as Appendix [  ], as amended from time to time (the “Bylaws”), the Investment Advisory Agreement between the Company and BC Partners Advisors L.P., our investment adviser (the “Adviser”) attached hereto as Appendix [  ], as amended from time to time (the “Advisory Agreement”), the Administration Agreement between the Company and BC Partners Management LLC, our administrator (the “Administrator”) attached hereto as Appendix [  ], as amended from time to time (the “Administration Agreement,” and together with the Memorandum, the Charter, the Bylaws and the Advisory Agreement, the “Operative Documents”). U.S. Bancorp Fund Services, LLC (in such capacity, the “Transfer Agent”) will act as transfer agent for the Shares unless and until, the Company or the Transfer Agent decides to terminate the agreement between the parties. The Administrator has entered into a Sub-Administration Agreement with U.S. BanCorp Fund Services, LLC (in such capacity, the “Sub-Administrator”), pursuant to which the Sub-Administrator will provide certain sub-administration services. The Company expects to enter into separate Subscription Agreements (the “Other Subscription Agreements”) with other investors (the “Other Investors”), providing for the sale of Shares to the Other Investors. This Subscription Agreement and the Other Subscription Agreements are separate agreements, and the sale of Shares to the undersigned and the Other Investors are separate sales. Capitalized terms not defined herein are used as defined in the Memorandum. 

(b)The Investor agrees to purchase Shares for an aggregate purchase price equal to its Capital Commitment, payable at such times and in such amounts as required by the Company, under the terms and subject to the conditions set forth herein. All purchases of the Company’s Shares will generally be made pro rata in accordance with remaining Capital Commitments of all investors, at a per-share price equal to the net asset value per share of the Company’s common stock as of the close of the last quarter preceding the drawdown date, subject to adjustment in certain circumstances. 

 

 

 

 

BC Partners Lending Corporation

2.   Drawdowns. 

(a)Subject to Section 2(e), the Investor agrees to purchase Shares for an aggregate purchase price equal to its Capital Commitment, payable at such times and in such amounts as requested by the Company under the terms and subject to the conditions set forth herein. Investor shall be required to fund a capital contribution to purchase Shares (a “Drawdown Purchase”) each time the Company delivers a drawdown request (the “Drawdown Request”) to the Investor. The initial closing (the “Initial Closing”) of the Private Offering will occur as soon as practicable but the Adviser may set the date of the Initial Closing in its sole discretion. The Company will hold additional closings subsequent to the Initial Closing (each date on which a subsequent closing is held, a “Subsequent Closing Date”). 

(b)Drawdown Requests shall be delivered at least ten (10) calendar days prior to the date on which payment will be due (each, a “Drawdown Date”) and shall set forth the amount, in U.S. dollars, of the aggregate purchase price (the “Drawdown Purchase Price”) to be paid by the Investor to purchase Shares on such Drawdown Date. Each purchase of Shares pursuant to a Drawdown Request will be made at a per Share price equal to the net asset value per share of the Shares as of the close of the last quarter preceding the Drawdown Date, subject to adjustment in certain circumstances. Any adjustments to the per Share purchase price would take into account a determination of changes to net asset value within 48 hours of the sale to assure compliance with Section 23(b) of the U.S. Investment Company Act of 1940, as amended (the “1940 Act”). Investor acknowledges and agrees that the Company intends to request contributions from all Investors pro rata in accordance with the remaining Capital Commitments of all investors; provided that in the event that an investor fails to pay all or any portion of the purchase price due from such investor on any Drawdown Date (such amount, together with the full amount of such investor’s remaining Capital Commitment, a “Defaulted Commitment”), the Company shall retain the right to require Investor to fund a Drawdown Purchase Price that is more than its pro rata share in order to fulfill obligations with respect to any Defaulted Commitment. In no event shall Investor be required to invest more than the total amount of its Capital Commitment.

(c)Each Drawdown Purchase Price shall be payable, in U.S. dollars and in immediately available funds per the wire transfer instructions set forth in the related Drawdown Request. In addition to the wire transfer instructions, each Drawdown Request shall set forth (i) the Drawdown Date, (ii) the aggregate amount of capital that is being drawn down from all Investors and (iii) the Investor’s share of capital drawn. The delivery of a Drawdown Request to the Investor shall be the sole and exclusive condition to the Investor’s irrevocable and unconditional obligation to pay such Drawdown Purchase Price in the amount set forth therein, without any right of offset, reduction, counterclaim or defense. 

(d)The commitment period (the “Commitment Period”) will continue until the five year anniversary of the Initial Closing of the Private Offering; provided, however, that the Commitment Period for any Investor that makes its initial Capital Commitment after the two year anniversary of the Initial Closing will extend until the three year anniversary of such stockholder’s initial Capital Commitment.

(e)At the earlier of (i) an Exchange Listing (defined below) and (ii) the end of the Commitment Period, Investors will be released from any further obligation to fund drawdowns and purchase additional Shares (other than any Defaulted Commitment), except to the extent necessary to pay amounts due under Drawdown Requests that the Company may thereafter issue: (i) to pay, and/or establish reserves for, actual or anticipated Company expenses, including management and incentive fees, any amounts that may become due under any borrowings or other 

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BC Partners Lending Corporation

 

financings or similar obligations and any other liabilities, contingent or otherwise, whether incurred before or after the end of the Investment Period, (ii) to fulfill investment commitments made or approved by the Adviser prior to the expiration of the Investment Period, (iii) to engage in hedging transactions, (iv) to fund follow-on investments made in existing portfolio companies (including transactions to hedge interest rate risks relating to such additional investment), (v) to fund obligations under any Company guarantee or indemnity made during the Investment Period, (vi) fulfill obligations with respect to any Defaulted Commitment or  (vii) as necessary for the Company to comply with applicable laws and regulations, including the Investment Company Act and the U.S. Internal Revenue Code of 1986, as amended (the “Code”).  An “Exchange Listing” shall mean the listing of the Shares on a national securities exchange. 

(f)Notwithstanding anything to the contrary contained in this Subscription Agreement, under the Charter, the Company will have the power to take certain actions to avoid having (i) the assets of the Company characterized as “plan assets,” for purposes of the fiduciary responsibility or prohibited transaction provisions of the U.S. Employee Retirement Income Security Act of 1974, as amended (“ERISA”), Section  4975 of the U.S. Internal Revenue Code of 1986, as amended (the “Code”) or Other Plan Laws (as defined below) including, without limitation, the right to cause an Investor that is a “benefit plan investor” (within the meaning of Section 3(42) of ERISA) to withdraw from the Company in whole or in part and (ii) the Company, the Adviser and BC Partners being considered a fiduciary of any Investor for purposes of Title I of ERISA, Section 4975 of the Code or any applicable Other Plan Law. While the Company does not expect that it will need to exercise such power, the Company cannot give any assurance that such power will not be exercised.

(g)(a) The Company may enter into Subscription Agreements with Other Investors on a Subsequent Closing Date (any Other Investor whose subscription has been accepted at such Subsequent Closing Date is referred to as a “Subsequent Investor”). Notwithstanding the provisions of Sections 1(b) and 3, on one or more dates to be determined by the Company that occur on or following the Subsequent Closing Date but no later than the next succeeding Drawdown Date (each, a “Catch-Up Date”), each Subsequent Investor shall be required to purchase from the Company, on no less than ten (10) calendar days prior notice, a number of Shares with an aggregate purchase price necessary to ensure that, upon payment of the aggregate purchase price for such Shares by the Subsequent Investor in the aggregate for all Catch-Up Dates, such Subsequent Investor’s Net Contributed Capital Percentage (as defined below) shall be equal to the Net Contributed Capital Percentage of all prior Investors (other than any Defaulting Investors or any Other Investor who has subscribed on prior Subsequent Closing Dates and have not yet funded the Catch-Up Purchase Price) (the “Catch-Up Purchase Price”). Upon payment of the Catch-Up Purchase Price by the Investor on a Catch-Up Date and payment by Other Investors of the requisite amount, the Company shall issue to each such Subsequent Investor a number of Shares determined by dividing (x) the Catch-Up Purchase Price for such Subsequent Investor minus the Organizational Expense Allocation (as defined below) by (y) the Per Share Price for such Subsequent Investor as of a Catch-Up Date. For the avoidance of doubt, in the event that the Catch-Up Date and a Capital Drawdown Date occur on the same calendar day, such Catch-Up Date and the application of the provisions of this Section 2(g) shall be deemed to have occurred immediately prior to the relevant Capital Drawdown Date. 

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BC Partners Lending Corporation

 

(b) For the purposes of this Subscription Agreement:  

(1) “Net Contributed Capital Percentage” means, with respect to an Investor, the quotient determined by dividing (x) such Investor’s Net Contributed Capital (as defined below) by (y) such Investor’s Capital Commitment.

(2) “Net Contributed Capital” means (x) the aggregate amount of capital contributions that have been made by all Investors pursuant to Sections 1(b) and 2, less (y) the aggregate amount of distributions categorized as returned capital made by the Company to all Investors in respect of their Shares.  For the avoidance of doubt, Net Contributed Capital shall not take into account distributions of the Company’s investment income (i.e., proceeds received in respect of interest payments, dividends or fees, net of expenses) to the Investors.  Net Contributed Capital with respect to an Investor shall be calculated on the basis of such Investor’s capital contributions and distributions made to such Investor categorized as returned capital.

(3) “Organizational Expense Allocation” means, with respect to an Investor, the product obtained by multiplying (x) a fraction, the numerator of which is such Investor’s Capital Commitment and the denominator of which is the total Capital Commitments received by the Company to date by (y) the total amount of organizational expenses spent by the Company in connection with the Company’s formation.

3.   Remedies Upon Investor Capital Drawdown Default. In the event of a Defaulted Commitment that remains uncured for a period of ten (10) business days, the Company shall be permitted to declare such Investor to be in default of its obligations under this Subscription Agreement (any such Investor, a “Defaulting Investor”) and shall be permitted to pursue one or any combination of the following remedies:

(a)The Company may prohibit the Defaulting Investor from purchasing additional Shares on any future Drawdown Date or otherwise participating in any future investments in the Company;

(b)Fifty percent (50%) of the Shares then held by the Defaulting Investor shall be automatically transferred on the books of the Company, without any further action being required on the part of the Company or the Defaulting Investor, to the Other Investors (other than any defaulting Other Investor), pro rata in accordance with their respective Capital Commitments; provided, however, that notwithstanding anything to the contrary contained in this Subscription Agreement, no Shares shall be transferred to any Other Investor pursuant to this Section 3(b) in the event that such Transfer (as defined in Section 4(g)) would (x) violate the Securities Act of 1933, as amended (the “Securities Act”), Investment Company Act or any state (or other jurisdiction) securities or “Blue Sky” laws applicable to the Company or such Transfer (as defined in Section 8(d)), (y) constitute a non-exempt “prohibited transaction” under Section 406 of ERISA or Section 4975 of the Code or (z) cause all or any portion of the assets of the Company to constitute “plan assets” for purposes of the fiduciary responsibility or prohibited transaction provisions of Title I of  ERISA or Section 4975 of the Code (it being understood that this proviso shall operate only to extent necessary to avoid the occurrence of the consequences contemplated herein and shall not prevent the Investor from receiving a partial allocation of its pro rata portion of Shares); provided, 

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BC Partners Lending Corporation

 

further, that any Shares that have not been transferred to one or more Other Investors pursuant to the previous proviso shall be allocated among the participating Other Investors pro rata in accordance with their respective Capital Commitments. The mechanism described in this Section 3(b) is intended to operate as a liquidated damage provision, since the damage to the Company and Other Investors resulting from a default by the Defaulting Investor is both significant and not easily susceptible to precise quantification. By entry into this Subscription Agreement, the Investor agrees to this Transfer (as defined in Section 4(g)) and acknowledges that it constitutes a reasonable liquidated damage remedy for any default in the Investor’s obligation of the type described; and

(c)The Company may pursue any other remedies against the Defaulting Investor available to the Company, subject to applicable law. The Investor agrees that this Section 3 is solely for the benefit of the Company and shall be interpreted by the Company against a Defaulting Investor in the discretion of the Company. The Investor further agrees that the Investor cannot and will not seek to enforce this Section 3 against the Company or any other investor in the Company.

4.   Representations and Warranties of the Investor.  To induce the Company to accept this subscription, the Investor represents and warrants as follows:

(a)The Investor, prior to its admission, has been furnished and has carefully read this Subscription Agreement and each Operative Document, in each case as amended, restated and/or supplemented through the date of the Investor’s subscription for Shares. The Investor has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of an investment in the Shares, is able to bear the risks of an investment in the Shares and understands the risks of, and other considerations relating to, a purchase of a Share, including the matters set forth under the caption “Risk Factors and Potential Conflicts of Interest” in the Memorandum.

(b)If the Investor is a natural person, the Investor has carefully read, and acknowledges and consents to, the data protection notice, attached as Annex [  ]  hereto.

(c)The Shares to be acquired hereunder are being acquired by the Investor for the Investor’s own account for investment purposes only and not with a view to resale or distribution.

(d)If the Investor is a natural person, the Investor has carefully read the Adviser’s privacy notice attached hereto as Appendix [  ]. 

(e)If the Investor is not a U.S. Person (a “Non-U.S. Investor”), except for offers and sales to discretionary or similar accounts held for the benefit or account of a non-U.S. Person by a U.S. dealer or other professional fiduciary, all offers to sell and offers to buy the Shares were made to or by the Non-U.S. Investor while the Non-U.S. Investor was outside the United States, and at the time that the Non-U.S. Investor’s order to buy the Shares was originated the Non-U.S. Investor was outside the United States.

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BC Partners Lending Corporation

 

(f)The Investor understands that the Company (i) intends to file an election to be treated as a business development company under the Investment Company Act and (ii) intends to file an election to be treated as a regulated investment company within the meaning of Section 851 of the Code, for U.S. federal income tax purposes; pursuant to those elections, the Investor will be required to furnish certain information to the Company as required under Treasury Regulations § 1.852-6(a) and other regulations. If the Investor is unable or refuses to provide such information directly to the Company, the Investor understands that it will be required to include additional information on its income tax return as provided in Treasury Regulation § 1.852-7. The Company has filed a registration statement on Form 10 (the “Form 10 Registration Statement”) for its common stock with the U.S. Securities and Exchange Commission (the “SEC”) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Form 10 Registration Statement is not the offering document pursuant to which the Company is conducting this offering and may not include all information regarding the Company contained in the Memorandum; accordingly, Investors should rely exclusively on information contained in the Operative Documents in making their investment decisions.

(g) The Investor understands that the offering and sale of the Shares are intended to be exempt from registration under the United States Securities Act of 1933, as amended (the “Securities Act”), applicable U.S. state securities laws and the laws of any non-U.S. jurisdictions by virtue of the private placement exemption from registration provided in Section 4(a)(2) of the Securities Act, Regulation D and Regulation S promulgated thereunder, exemptions under applicable U.S. state securities laws and exemptions under the laws of any non-U.S. jurisdictions, and it agrees that any Shares acquired by the Investor may not be sold, offered for sale, exchanged, transferred, assigned, pledged, hypothecated or otherwise disposed of (each, a “Transfer”) in any manner that would require the Company to register the Shares under the Securities Act, under any U.S. state securities laws or under the laws of any non-U.S. jurisdictions. The Investor understands that the Company requires each investor in the Company to be an “accredited investor” as defined in Rule 501(a) of Regulation D of the Securities Act (“Accredited Investor”) and the Investor represents and warrants that it is an Accredited Investor.  

(h)The Investor understands that the offering and sale of the Shares in non-U.S. jurisdictions may be subject to additional restrictions and limitations, and represents and warrants that it is acquiring its Shares in compliance with all applicable laws, rules, regulations and other legal requirements applicable to the Investor including, without limitation, the legal requirements of jurisdictions in which the Investor is resident and in which such acquisition is being consummated. Furthermore, the Investor understands that all offerings and sales made outside of the United States will be made pursuant to Regulation S under the Securities Act. 

(i)The Investor understands that the Shares have not been registered under the Securities Act, the securities laws of any state of the United States or the securities laws of any other jurisdiction, nor is such registration contemplated.  The Investor understands and agrees further that the Shares must be held indefinitely unless they are subsequently registered under the Securities Act and any other applicable securities laws or an exemption from registration under the Securities Act and these laws covering the sale of the Shares is available.  Even if such an exemption is available, the assignability and transferability of the Shares will be governed by this Subscription Agreement and the Operative Documents which impose substantial restrictions on transfer.  The Investor understands that legends stating that the Shares have not been registered under the Securities Act and any other applicable securities laws and setting out or referring to the restrictions on the transferability and resale of the Shares will be placed on all documents evidencing the Shares. Further, the Investor represents and warrants that there are no governmental orders, permissions, consents, approvals or authorizations that are required to be obtained and/or 

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BC Partners Lending Corporation

 

observed, and no registrations or other filings (other than a notice of exempt offering on Form D under the Securities Act or other similar filings under any applicable U.S. state “blue sky” law) are required to be made (in each case whether regarding registration as a lobbyist, investment advisor and/or other status or category, or otherwise (including restrictions on gifts, political contributions or other activities) for the Company, the Adviser or their respective affiliates or employees) in connection with the purchase of the Shares by the Investor. 

(j)The Investor acknowledges that (i) there is no established market for the Shares and it is likely that no public market for the Shares will develop, (ii) the Shares are not currently, and the Investor has no rights to require the Shares be, registered under the Securities Act or the securities laws of the various states or any non-U.S. jurisdiction and therefore cannot be transferred unless subsequently registered or unless an exemption from such registration is available, and (iii) the Investor may have to hold the Shares herein subscribed for and bear the economic risk of this investment indefinitely, and it may not be possible for the Investor to liquidate its investment in the Company. The Investor’s overall investment in the Company and other investments that are not readily marketable is not disproportionate to the Investor’s net worth and the Investor has no need for immediate liquidity in the Investor’s investment in the Shares.

(k)To the full satisfaction of the Investor, the Investor has been furnished any materials the Investor has requested relating to the Company, the offering of Shares or any statement made in the Memorandum, and the Investor has been afforded the opportunity to ask questions of representatives of the Company concerning the terms and conditions of the offering and to obtain any additional information necessary to verify the accuracy of any representations or information set forth in the Memorandum.

(l)Other than as set forth herein, in the Memorandum or in the Operative Documents, the Investor is not relying upon any other information (including, without limitation, any advertisement, article, notice or other communication published in any newspaper, magazine, website or similar media or broadcast over television or radio, and any seminars or meetings whose attendees have been invited by any general solicitation or advertising), representation or warranty by the Company, the Adviser or any agent of either of them in determining to invest in the Company and the Investor understands the Memorandum is not intended to convey financial, tax, legal or accounting advice.  The Investor has consulted to the extent deemed appropriate by the Investor with the Investor’s own advisors as to the financial, tax, legal, accounting, regulatory and related matters concerning an investment in the Shares and on that basis understands the financial, tax, legal, accounting, regulatory and related consequences of an investment in the Shares, and believes that an investment in the Shares is suitable and appropriate for the Investor.

(m)If the Investor is not a natural person, (i) the Investor was not formed or recapitalized for the specific purpose of acquiring any Shares in the Company, (ii) the Investor has the power and authority to enter into this Subscription Agreement and each other document required to be executed and delivered by the Investor in connection with this subscription for Shares, and to perform its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby, and (iii) the person signing this Subscription Agreement on behalf of the Investor has been duly authorized to execute and deliver this Subscription Agreement and each other document required to be executed and delivered by the Investor in connection with this subscription for Shares.  If the Investor is a natural person, the Investor has all requisite legal capacity to acquire and hold the Shares and to execute, deliver and comply with the terms of each of the documents required to be executed and delivered by the Investor in connection with this subscription for Shares.  The execution and delivery by the Investor of, and compliance by the Investor with, this Subscription Agreement and each other document required to be executed and 

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delivered by the Investor in connection with this subscription for Shares does not violate or represent a breach of, or constitute a default under, any instrument governing the Investor, any law, regulation, order or policy, or any agreement to which the Investor is a party or by which the Investor is bound.  This Subscription Agreement has been duly executed by the Investor and constitutes a valid and legally binding agreement of the Investor, enforceable against it in accordance with the terms thereof (subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws relating to or affecting creditors’ rights generally, by equitable principles (whether considered in a proceeding in equity or at law) and by an implied covenant of good faith and fair dealing).

(n)If the Investor is, or is acting (directly or indirectly) on behalf of, a “Plan1” which is subject to Title I of ERISA, Section 4975 of the Code, or any provisions of any other federal, state, local, non-U.S. or other laws or regulations that are similar to those provisions contained in such portions of ERISA or the Code (collectively, “Other Plan Laws”): 

(1)(i) neither the Company, BC Partners LLP (“BC Partners”), the Adviser nor any of their respective affiliates (the “Relevant Parties”) has acted as the Plan’s fiduciary, or has been relied upon for any advice, with respect to the Plan’s decision to purchase or hold any Shares and none of the Relevant Parties shall at any time be relied upon as the Plan’s fiduciary with respect to any decision to purchase, continue to hold, transfer, withdraw, vote or provide any consent with respect to any Shares and

(ii) the decision to invest in the Company has been made, and the performance of the Plan’s obligations under (and the exercise of the Plan’s rights in connection with) the Shares, including under this Subscription Agreement, will continue to be made, at the recommendation or direction of an independent fiduciary (a “Fiduciary”) who is:

(a) independent of the Relevant Parties; 

(b) capable of evaluating investment risks independently, both in general and with respect to particular transactions and investment strategies contemplated in the Operative Documents; 

(c) a fiduciary (under ERISA, Section 4975 of the Code or applicable Other Plan Laws, as applicable) with respect to the Plan’s investment in the Company and is responsible for exercising independent judgment in evaluating the Plan’s investment in the Company; and

	
	 

	
1
	
     The term “Plan” is defined to include (i) an employee benefit plan (within the meaning of Section 3(3) of ERISA),
whether or not such plan is subject to Title I of ERISA, (ii) a plan, individual retirement account or other
arrangement that is described in Section 4975 of the Code, whether or not such plan, individual retirement account
or other arrangement is subject to Section 4975 of the Code, (iii) a plan, fund or other similar program that is
established or maintained outside the United States which provides for retirement income, a deferral of income
in contemplation of retirement or payments to be made upon termination of employment, (iv) an insurance
company using general account assets if such general account assets are deemed to include the assets of any of
the foregoing types of plans, accounts or arrangements for purposes of Title I of ERISA or Section 4975 of the
Code under Section 401(c)(1)(A) of ERISA or the regulations promulgated thereunder, and (v) an entity that is
deemed to hold the assets of any of the foregoing described in clauses (i), (ii), (iii) or (iv) pursuant to ERISA or
otherwise.

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(d) aware of and acknowledges that (I) none of the Relevant Parties are undertaking to provide impartial investment advice, or to give advice in a fiduciary capacity, in connection with the Plan’s investment in the Company, (II) the Relevant Parties have a financial interest in the Plan’s investment in the Company on account of the fees and other compensation they expect to receive from the Company and their other relationships with the Company, as contemplated in the Operative Documents and (III) any such fees and other compensation received by a Relevant Party in connection with the transactions contemplated in the Operative Documents, do not constitute fees or other compensation rendered for the provision of investment advice to the Plan. 

(2)the Fiduciary has taken into consideration its fiduciary duties under ERISA, the Code or any applicable Other Plan Law, as applicable, including the diversification requirements of Section 404(a)(1)(C) of ERISA (if applicable), in authorizing the Plan’s investment in the Company, and has concluded that such investment is prudent; 

(3)the Plan’s decision to invest in the Company and the acquisition of Shares of the Company contemplated thereby is in accordance with the terms of the Plan’s governing instruments and complies with all applicable requirements of ERISA, the Code and Other Plan Laws and does not constitute a non-exempt prohibited transaction under ERISA or Section 4975 of the Code or a similar violation under any applicable Other Plan Laws;

(4)if the Investor is (directly or indirectly) investing the assets of a Plan which is not subject to Title I of ERISA or Section 4975 of the Code but is subject to other federal, state, local, non-U.S. or other laws or regulations that could cause the underlying assets of the Company to be treated as assets of the Plan by virtue of its investment in the Company and thereby subject the Company and the Adviser (or other Persons responsible for  the operation of the Company and/or investment of the Company’s assets) to laws or regulations that are similar to the fiduciary responsibility or prohibited transaction provisions contained in Title I of ERISA or Section 4975 of the Code (“Similar Law”), the Company’s assets will not constitute the assets of such Plan under the provisions of any applicable Similar Law.

The representations and warranties set forth in this paragraph 4(n) shall be deemed repeated and reaffirmed on each day the Investor holds any Shares.  If at any time prior to the winding up and dissolution of the Company the representations and warranties set forth in this paragraph shall cease to be true, the Investor shall promptly notify the Company in writing.

 

(o)The Investor was offered the Shares through private negotiations, not through any general solicitation or general advertising.  If the Investor is a U.S. person, the Investor was offered the Shares in the jurisdiction listed in the Investor’s permanent address set forth in the Investor Questionnaire attached hereto or previously provided to the Company (the “Investor Questionnaire”) and, to the extent any state securities laws govern the Investor’s subscription  (in addition to applicable U.S. federal securities laws), the securities laws of such jurisdiction shall govern.  If the Investor is a non-U.S. person, the Investor (i) intends that the U.S. federal securities laws govern the Investor’s subscription and (ii) represents that it has obtained professional advice and/or otherwise satisfied itself that there are no non-U.S. governmental orders, permissions, consents, approvals or authorizations that are required to be obtained, and no registrations or other filings thereunder that are required to be made, in connection with or relating to the purchase of a Share by the Investor.

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(p)The Investor will promptly provide, at any times requested by the Company, the Adviser, the Administrator, the Sub-Administrator and/or the Transfer Agent, any information (or verification thereof) necessary for the Company to comply with any intergovernmental agreement entered into in connection with Sections 1471 through 1474 of the Code and any U.S. Department of Treasury Regulations (“Treasury Regulations”), forms, instructions or other guidance issued pursuant thereto or (y) any laws or other requirements enacted by any jurisdiction to implement any such intergovernmental agreement or other such regime (such agreements, regimes, laws or other requirements in clauses (i) and (ii) individually an “International Tax Reporting Regime” and, collectively, “International Tax Reporting Regimes”). The Investor agrees to waive any provision of foreign law that would, absent a waiver, prevent compliance with such requests and acknowledges that, if the Investor fails to provide such waiver, the Company may prohibit additional investments, decline or delay any repurchase requests by the Investor and retain amounts sufficient to indemnify and hold harmless the Company from any and all withholding taxes, interest, penalties and other losses and liabilities suffered by the Company on account of the Investor’s not providing all requested information and documentation.  In addition, the Investor acknowledges that if it fails to supply such information on a timely basis, it may be subject to a 30% U.S. withholding tax imposed on (i) dividends and certain other income; and (ii) gross proceeds from the sale or other disposition of its Shares.

(q)The Investor will promptly notify the Company and the Sub-Administrator in writing if (i) the Internal Revenue Service terminates any agreement entered into with the Investor under Section 1471(b) of the Code, or (ii) any information provided to the Company and/or the Sub-Administrator pursuant to paragraph 2(n) above changes.

(r)(i) Neither the Investor, nor any of its affiliates or beneficial owners, (A) appears on the Specially Designated Nationals and Blocked Persons List of the Office of Foreign Assets Control of the United States Department of the Treasury (“OFAC”), nor are they otherwise a party with which the Company is prohibited to deal under the laws of the United States, or (B) is a Person identified as a terrorist organization on any other relevant lists maintained by governmental authorities.  The Investor further represents and warrants that: (i) if the Investor is a natural person, the Investor is not a person who is or has been entrusted with prominent public functions, such as a Head of State or of government, a senior politician, a senior government, judicial or military official, a senior executive of a state-owned corporation or an important political party official, or a close family member or close associate of any such person; (ii) the monies used to fund the investment in the Shares are not derived from, invested for the benefit of, or related in any way to, the governments of, or persons within, any country that (A) is under a U.S. embargo enforced by OFAC, (B) has been designated a “Non-Cooperative Country or Territory” by the Financial Action Task Force on Money Laundering, or (C) has been designated by the U.S. Secretary of the Treasury as a “primary money laundering concern”; (iii) the Investor (A) has conducted thorough due diligence with respect to all of its beneficial owners, (B) has established the identities of all beneficial owners and the source of each of the beneficial owner’s funds and (C) will retain evidence of any such identities, any such source of funds and any such due diligence. Pursuant to anti-money laundering laws and regulations, the Company may be required to collect documentation verifying the Investor’s identity and the source of funds used to acquire the Shares before, and from time to time after, acceptance by the Company of this Subscription Agreement. The Investor further represents and warrants that the Investor does not know or have any reason to suspect that (A) the monies used to fund the Investor’s investment in the Shares have been or will be derived from or related to any illegal activities, including but not limited to, money laundering activities, (other than the lawfully confiscated proceeds of criminal activity) and (B) the proceeds from the Investor’s investment in the Shares will be used to finance any illegal activities.  The Investor agrees and acknowledges that, among other remedial measures, (i) the Company may be 

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obligated to “freeze the account” of such Investor, either by prohibiting additional investments by the Investor and/or segregating assets of the Investor in compliance with governmental regulations and/or if the Company determines in its good faith that such action is in the best interests of the Company; and (ii) the Company may be required to report such action or confidential information relating to the Investor (including, without limitation, disclosing the Investor’s identity) to the regulatory authorities.  The Investor represents that in the event that it is, receives deposits from, makes payments to or conducts transactions relating to a non-U.S. banking institution (a “Non-U.S. Bank”) in connection with the Investor’s investment in the Shares, such Non-U.S. Bank: (i) has a fixed address, other than an electronic address or a post office box, in a country in which it is authorized to conduct banking activities; (ii) employs one or more individuals on a full-time basis; (iii) maintains operating records related to its banking activities; (iv) is subject to inspection by the banking authority that licensed it to conduct banking activities; and (v) does not provide banking services to any other Non-U.S. Bank that does not have a physical presence in any country and that is not a registered affiliate.

(ii)  The Investor will provide to the Company, the Adviser and the Sub-Administrator at any time such information as the Company, the Adviser and/or the Sub-Administrator determines to be necessary or appropriate (A) to comply with the anti-money laundering laws, rules and regulations of any applicable jurisdiction and (B) to respond to requests for information concerning the identity of the Investor from any governmental authority, self-regulatory organization or financial institution in connection with its anti-money laundering compliance procedures, or to update such information. The Investor acknowledges and agrees that Shares of the Company may not be issued until such time as the Company and, if applicable, certain service providers of the Company have received and are satisfied with all of the information and documentation requested to verify the Investor’s identity for purposes of complying with anti-money laundering laws, rules and regulations of any applicable jurisdiction. The Investor further acknowledges and agrees that it may be prohibited from receiving any payment or distribution, and the Adviser (on behalf of certain service providers of the Company) reserves the right to refuse to make any payment or distribution to the Investor until such time as the Adviser and, if applicable, certain service providers of the Company have received and are satisfied with all of the information and documentation requested to verify the Investor’s identity for purposes of complying with anti-money laundering laws, rules and regulations of any applicable jurisdiction.

(iii)  To comply with applicable U.S. anti-money laundering laws and regulations, all payments and contributions by the Investor to the Company and all payments and distributions to the Investor from the Company will only be made in the Investor’s name and to and from a bank account or a bank based or incorporated in or formed under the laws of the United States or that is regulated in and either based or incorporated in or formed under the laws of the United States and that is not a “foreign shell bank” within the meaning of the U.S. Bank Secrecy Act (31 U.S.C. § 5311 et seq.), as amended, and the regulations promulgated thereunder by the U.S. Department of the Treasury, as such regulations may be amended from time to time

(iv)  The representations and warranties set forth in this paragraph 2(r) shall be deemed repeated and reaffirmed by the Investor to the Company as of each date that the Investor is required to make a Drawdown Purchase, or receives a distribution from the Company. If at any time during the term of the Company, the representations and warranties set forth in this paragraph 2(q) cease to be true, the Investor shall promptly so notify the Company in writing.

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(v)  The Investor has conducted appropriate due diligence of any beneficial owner who is (i) a Senior Foreign Political Figure (“SFPF”), (ii) an immediate family member of a SFPF, (iii) a person who is widely known (or is actually knowns by the Investor) to maintain a close personal relationship with any such individual or (iv) a corporation, business or other entity that has been formed by or for the benefit of such individual. 

(s)The Investor acknowledges that the Company (x) has the right, at its option, to borrow money from any Person, to make guarantees or provide other credit support to any Person to or incur any other obligation, including on a joint, several, joint and several or cross-collateralized basis, for any proper purpose relating to the activities of the Company, and to pledge the assets of the Company (including investments and the right to issue Drawdown Requests and the Company’s other related rights, titles, interests, remedies, powers, and privileges with respect to the Capital Commitments and Drawdown Purchases to secure any such obligations, and (y) intends to enter into one or more revolving credit facilities with one or more lenders or to incur indebtedness in lieu of or in advance of the Initial Closing. Investor hereby (A) acknowledges and confirms, for the benefit of one or more lenders or other persons extending credit as contemplated by this Section 4(s) (i) that Investor’s Subscription Agreement constitutes Investor’s legal, valid and binding obligation, enforceable against Investor in accordance with its terms, (ii) that any Lender may be relying (in whole or in part) on the funding by Investor of its Drawdown Purchases as its primary source of repayment, and (iii) Investor’s obligations pursuant to this Subscription Agreement to make Drawdown Purchases to an account of the Company, which amounts shall not satisfy such Investor’s obligation to fund Capital Commitments until paid into such account and which are called by the Company or by such lenders (in accordance with the agreements between such Lenders and the Company), to pay the outstanding obligations of the Company and/or such other entities to such lenders without defense, counterclaim or offset of any kind, including Section 365 of Title 11 of the U.S. Code; provided, (1) any such agreement to make Drawdown Purchases without defense, counterclaim or offset of any kind shall not be effective with respect to any Plan unless such agreement shall not constitute a non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code, (2) in no event shall Investor be obligated to make Drawdown Purchases in excess of its total Capital Commitment, and (3) such pledge and/or acknowledgement and agreement to make Drawdown Purchases shall not result in the loss of Investor’s limited liability status under this Subscription Agreement or act as a waiver by Investor of its right to assert independently any claim that it may have against the Company under this Subscription Agreement and (B)  shall provide the Company with such financial and other information and documentation as the Company deems reasonably necessary in connection with financing for the Company. The provisions of this Subscription Agreement relating to contributions of capital to the Company and all related rights, titles, interests, remedies, powers and privileges of the Company with respect thereto  are for the benefit of the Company and each lender that provides financing in accordance herewith.  All rights granted to any such lender pursuant to Section 4(s) shall apply to such lender’s agents, successors and permitted assigns.

(t)The Investor will not transfer or deliver any interest in the Shares except in accordance with the restrictions set forth in this Subscription Agreement and the Operative Documents.

(u)By signing this Subscription Agreement each grantor of a subscribing revocable trust (the “Subscribing Trust”) hereby acknowledges that as of the date of this Subscription Agreement, such grantor has reviewed all information pertaining to such grantor provided by such grantor of the Subscribing Trust to the Company in connection with the Subscribing Trust’s subscription for the Shares hereunder, and such grantor hereby certifies that such information, including without limitation, information contained herein and information 

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BC Partners Lending Corporation

 

incorporated herein by reference, is true, correct and complete as of the date hereof and may be relied upon by the Company and the Adviser in determining the Subscribing Trust’s and such grantor’s suitability as an investor in the Company.  Each grantor of the Subscribing Trust hereby agrees that each covenant and agreement of the Subscribing Trust contained herein, is binding upon such grantor and enforceable against such grantor as if made directly by such grantor to the Company and the Adviser.

(v)The Investor understands and agrees that the Company, the Adviser, the Administrator, the Sub-Administrator and the Transfer Agent may present this Subscription Agreement and the information provided in answers to it to such parties (e.g., affiliates, attorneys, auditors, banks, lenders, broker and regulators) as it deems necessary or advisable to facilitate the acceptance and management of the Investor’s Drawdown Purchases and the operation of the Company, including, but not limited to, in connection with anti-money laundering and similar laws, if called upon to establish the availability under any applicable law of an exemption from registration of the Shares, the compliance with applicable law and any relevant exemptions thereto by the Company, the Adviser or their affiliates, or if the contents thereof are relevant to any issue in any action, suit or proceeding to which the Company, the Adviser or their affiliates are a party or by which they are or may be bound or if the information is required to facilitate the Company’s investments.  The Company, the Adviser and the Administrator may also release information about the Investor if directed to do so by the Investor, if compelled to do so by law or in connection with any government or self-regulatory organization request or investigation.

(w)The Investor further acknowledges and agrees that as more fully described in the Memorandum, the Company may from time to time participate in Investments in or relating to portfolio entities of certain other investment vehicles, funds and/or accounts affiliated with BC Partners (including, for the avoidance of doubt, with respect to Investments representing follow-on investments relating to such portfolio entities and/or Investments in portfolio entities in which Other BC Partners Vehicles have other interests).  The Investor also acknowledges that, subject to receipt of exemptive relief from the SEC and applicable law, the Company may from time to time seek to initiate one or more transactions intended to provide Stockholders with liquidity options with respect to their investment in the Company (each, a “Reorganization”), pursuant to which an Investor will have the option to exchange their Shares and any remaining Commitment, or a portion of their Shares and any remaining Commitment, in the Company to an interest in an entity (a “Liquidating Company”) that would generally seek to liquidate and distribute the proceeds of its investments, as they are received, to its equity holders over time, such that it would likely substantially complete its liquidation within a reasonable period of time following the date of the Reorganization.  The Investor, by executing and delivering this Subscription Agreement, hereby  (i) acknowledges and consents to any such transactions and the Company’s participation therein for all purposes as described in the Memorandum and under applicable law and/or regulation (including, without limitation, the Advisers Act) and (ii) authorizes and empowers the Adviser, on behalf of the Company, to take such further actions and prepare, execute and deliver such other instruments, documents and/or agreements as the Adviser determines in good faith are necessary or appropriate in connection with the foregoing.  It is anticipated that, if initiated, the first Reorganization would occur as soon as reasonably practicable following the end of the fiscal year during which the third anniversary of the Initial Closing occurs (the “Initial Reorganization”). The Investor acknowledges and consents that this Subscription Agreement sets forth the Investor’s election regarding whether the Investor intends to participate in the Initial Reorganization, if initiated (which election may be changed prior to the Initial Reorganization as described herein). If the first Reorganization occurs, the Company will seek each investor’s written election for the second Reorganization, and would follow a similar process for any subsequent Reorganizations. The Investor further acknowledges that the Company is not obligated to pursue any Reorganization even if exemptive relief is received. SEC exemptive relief, if granted, may impact the process by which investors elect to participate in any Reorganization.

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(x)The Investor represents and warrants that neither the Investor nor any person who through the Investor’s Shares (including anyone who has investment discretion on the Investor’s behalf) beneficially owns the Shares has been subject to any “disqualifying event” (as defined in Rule 506(d)(1) under the Securities Act) at any time on or prior to the Investor’s investment in the Company. The representations and warranties set forth in this paragraph 2(t) shall be deemed repeated and reaffirmed by the Investor to the Company as of each subsequent closing of the Company. Furthermore, the Investor agrees to provide the Company with (1) prompt written notice of the occurrence of any event specified above with respect to the Investor or any such beneficial owner and (2) any information, documentation or certifications (including, if requested, a “bad actor” disqualification questionnaire) required by the Company, in its sole discretion, to permit the Company to comply with its obligations pursuant to Rule 506(d) under the Securities Act.

5.   Representations and Warranties of the Company. To induce the Investor to accept this subscription, the Company represents as follows: 

(a)The Company is empowered, authorized and qualified to enter into this Subscription Agreement, the Advisory Agreement and the Administration Agreement, and each of the persons signing this Subscription Agreement, the Advisory Agreement and the Administration Agreement on behalf of the Company has been duly authorized by the Company to do so. 

(b)The execution and delivery of this Subscription Agreement, the Advisory Agreement and the Administration Agreement by the Company and the performance of its duties and obligations hereunder and thereunder do not and will not result in a breach of any of the terms, conditions or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, credit agreement, note or other evidence of indebtedness, or any lease or other agreement, or any license, permit, franchise or certificate, to which the Company is a party or by which it is bound or to which any of its properties are subject, or require any authorization or approval under or pursuant to any of the foregoing, violate the organizational documents of the Company, or violate in any material respect any statute, regulation, law, order, writ, injunction or decree to which the Company is subject.

(c)The Company is not in default (nor has any event occurred which with notice, lapse of time, or both, would constitute a default) in the performance of any obligation, agreement or condition contained in this Subscription Agreement, the Advisory Agreement and the Administration Agreement, any indenture, mortgage, deed of trust, credit agreement, note or other evidence of indebtedness or any lease or other agreement or understanding, or any license, permit, franchise or certificate, to which it is a party or by which it is bound or to which its properties are subject, nor is it in violation of any statute, regulation, law, order, writ, injunction, judgment or decree to which it is subject, which default or violation would materially adversely affect the business or financial condition of the Company or impair the Company’s ability to carry out its obligations under this Subscription Agreement or the Advisory Agreement.

(d)There is no litigation, investigation or other proceeding pending or, to the knowledge of the Company, threatened against the Company that, if adversely determined, would materially adversely affect the business or financial condition of the Company or the ability of the Company to perform its obligations under this Subscription Agreement, the Advisory Agreement and the Administration Agreement.

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(e)The Shares to be issued and sold by the Company to the Investor hereunder have been duly authorized and, when issued and delivered to the Investor against payment therefore as provided in this Subscription Agreement, will be validly issued, fully paid and non-assessable.

6.   Further Advice and Assurances.  All information that the Investor has provided to the Company, the Adviser, the Sub-Administrator and the Transfer Agent, including the information in this Subscription Agreement and in the Investor Questionnaire, is true, correct and complete as of the date hereof, and the Investor agrees to notify the Company, the Adviser, the Sub-Administrator and the Transfer Agent promptly if any representation, warranty or information contained in this Subscription Agreement, including the Investor Questionnaire, becomes untrue or incomplete at any time.  The Investor agrees to provide such information and execute and deliver such documents regarding itself and its beneficial owners as the Company, the Adviser, the Sub-Administrator and/or the Transfer Agent may reasonably request from time to time to verify the accuracy of the Investor’s representations and warranties herein, establish the identity of the Investor and the direct and indirect participants in its investment in the Shares, or to comply with any law, rule or regulation to which the Company, the Adviser, or the Administrator may be subject, including compliance with anti-money laundering laws and regulations. With respect to the obligations of any Investor that is a corporate pension plan or governmental entity (including pension plans or systems) to provide any financial or other information to the Company, the Adviser, the Sub-Administrator and/or the Transfer Agent or any third parties (including any lender or other source of financing to the Company) in connection with the Investor’s investment in the Company pursuant this Subscription Agreement (including the Investor Questionnaire) or any other document in connection with the Investor’s investment in the Company, the Company shall not require the Investor to deliver such information in respect of its pensioners or other ultimate beneficial owners.

7.   Power of Attorney.  The Investor by executing this Subscription Agreement as security for its obligations hereunder hereby irrevocably appoints the Company, with full power of substitution, as the Investor’s true and lawful representative and attorney in fact, and agent of the Investor, to execute, acknowledge, verify, swear to, deliver, record and file, in the Investor’s name, place and stead:

(a)any and all filings required to be made by the Investor under the Exchange Act with respect to the Company’s securities which may be deemed to be beneficially owned by the Investor under the Exchange Act; 

(b)all certificates and other instruments deemed advisable by the Company in order for the Company to enter into any borrowing or pledging arrangement;

(c)all certificates and other instruments deemed advisable by the Company to comply with the provisions of this Subscription Agreement and applicable law or to permit the Company to become or to continue as a business development corporation; 

(d)all other instruments or papers not inconsistent with the terms of this Subscription Agreement which may be required by law to be filed on behalf of the Company; and 

(e)any amendment or modification to any of the foregoing and all other certificates, instruments and documents which said attorney-in-fact determines in its discretion are necessary or desirable to effectuate the provisions of this Subscription Agreement or any other Subscription Agreements and the purposes of the Company. 

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With respect to the Investor and the Company, the foregoing power of attorney, (i) is coupled with an interest and shall be irrevocable, (ii) may be exercised by the Company either by signing separately as attorney-in-fact for the Investor or, after listing all of the Investors executing an instrument, by a single signature of the Company acting as attorney-in-fact for all of them, (iii) shall survive the assignment by the Investor of the whole or any fraction of its Shares, (iv) shall terminate concurrently with the termination of the Capital Commitment, in accordance with Section 2(e), and (v) may not be used by the Company in any manner that is inconsistent with the terms of this Subscription Agreement and any other written agreement between the Company and the Investor.

8.   Indemnity.  The Investor understands that the information provided herein (including in the Investor Questionnaire) will be relied upon by the Company and the Adviser for the purpose of determining the eligibility of the Investor to purchase Shares of the Company.  The Investor agrees to provide, if requested, any additional information that may reasonably be required to determine the eligibility of the Investor to purchase Shares of the Company.  To the fullest extent permitted under applicable law, the Investor agrees to indemnify and hold harmless the Company, the Adviser, the Administrator, and their respective affiliates (each an “Indemnified Person” and together, the “Indemnified Persons”) thereof from and against any loss, damage or liability due to or arising out of a breach of any representation, warranty or agreement of the Investor contained in this Subscription Agreement (including the Investor Questionnaire attached hereto) or in any other document provided by the Investor in connection with the Investor’s investment in the Shares. Notwithstanding any provision of this Subscription Agreement (including the Investor Questionnaire), the Investor does not waive any rights granted to it under applicable securities laws.

9.   Miscellaneous.  This Subscription Agreement is not transferable or assignable by the Investor without the consent of the Company. The cover page, the table of contents and headings of the sections of this Subscription Agreement are inserted for convenience only. When the words or phrases “include” or “including” and words or phrases of similar import are followed by a list of one or more items, such list shall deemed to be illustrative only and shall not be deemed to be an exclusive listing. The word “shall” shall be construed to have the same meaning and effect as the word “will.”  The representations and warranties made by the Investor in this Subscription Agreement, including the Investor Questionnaire attached hereto, shall survive the closing of the transactions contemplated hereby and any investigation made by the Company.  The Investor Questionnaire, including without limitation the representations and warranties contained therein, is an integral part of this Subscription Agreement and shall be deemed incorporated by reference herein.  This Subscription Agreement may be executed in one or more counterparts, all of which together shall constitute one instrument, and shall be governed by and construed in accordance with the laws of New York. The Investor irrevocably agrees that the courts of the State of Maryland (or, if the Company determines and the Investor agrees as of such Investor’s admission date, in the courts of the State of New York located in New York County or the United States District Court for the Southern District of New York), to the extent subject matter jurisdiction exists therefor, are to have non-exclusive jurisdiction to settle any dispute (including claims for set-off and counterclaims) which may arise in connection with the validity, effect, interpretation or performance of, all the legal relationships established by this Subscription Agreement or otherwise arising in connection with this Subscription Agreement, and the Investor irrevocably waives, to the fullest extent permitted by law, any objection that it may now or hereafter have to the laying of venue in such courts or any claim that any action or proceeding brought in any such court has been brought in an inconvenient forum. UNLESS OTHERWISE AGREED BY THE COMPANY IN WRITING, THE INVESTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT THAT THE INVESTOR MAY HAVE TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION DIRECTLY OR INDIRECTLY BASED UPON OR ARISING OUT OF THIS SUBSCRIPTION AGREEMENT. 

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10.   Other BC Partners Vehicles.  Additional vehicles sponsored by BC Partners LLP or its affiliates, including one or more business development companies, (referred to herein as “Other BC Partners Vehicles”), may be formed to invest alongside the Company to accommodate the special legal, tax, accounting, regulatory or other needs of certain investors. 

11.   Distributions.  The Company has adopted a dividend reinvestment plan, pursuant to which the Company will reinvest all cash dividends declared by the Board of Directors on behalf of Investors who do no elect to receive their dividends in cash.  Distributions to the Investor in respect of its Shares shall be made as specified in Section A of the Investor Questionnaire. A registered stockholder is able to elect to receive an entire cash dividend or other distribution in cash by notifying the Adviser in writing so that such notice is received by the Adviser no later than ten (10) days prior to the record date for distributions to stockholders. 

12.   Certain Definitions.  For purposes hereof, unless otherwise indicated, “United States” and “U.S. Person” shall have the meanings set forth in Regulation S of the Securities Act and Section 7701(a)(30) of the Code as the context requires. 

13.   Confidentiality. The Investor acknowledges that the Memorandum and other information relating to the Company is to be used by the Investor solely in connection with the consideration of the purchase of the Shares and contains confidential, proprietary, trade secret and other commercially sensitive information and is strictly confidential. Your acceptance of the Memorandum from the Company constitutes your agreement to (i) keep confidential all the information contained in this Memorandum, as well as all information derived by you from the information contained herein and in the documents referred to herein  (collectively, “Confidential Information”) and not disclose any such Confidential Information to any other person, (ii) not use any of the Confidential Information for any purpose other than to evaluate an investment in the Company (including not trading in any security on the basis of such Confidential Information) and (iii) promptly return this document and any copies hereof to the Company upon the Company’s request. The Investor acknowledges and agrees that monetary damages would not be sufficient remedy for any breach of this section by it, and that in addition to any other remedies available to the Company in respect of any such breach, the Company shall be entitled to specific performance and injunctive or other equitable relief as a remedy for any such breach.

14.   Notices.  All notices, consents, requests, demands, offers, reports, and other communications (collectively, “Notices”) required or permitted to be given pursuant to this Subscription Agreement shall be in writing and shall be given, made or delivered by personal hand-delivery, by facsimile transmission, by electronic mail, or by air courier guaranteeing overnight delivery, addressed as set forth below. Notice shall be deemed given on the date of service or transmission if personally served or transmitted by facsimile transmission or by electronic mail; provided, that if such service or transmission is not on a business day or is after normal business hours, then such notice shall be deemed given on the next business day.  Notice otherwise sent as provided herein shall be deemed given on the next business day following timely delivery of such Notice to an air courier guaranteeing overnight delivery. 

If to the Company, to: 

BC Partners Lending Corporation 

650 Madison Avenue

New York, NY 10022

 

		
	
Attention:
	
[  ]

	
Email:
	
[  ]

 

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BC Partners Lending Corporation

 

and, if to the Investor, to the address set forth in the Investor Questionnaire.  The Company or the Investor may change its address by giving notices to the other in the manner described herein. 

15.   No Joint Liability Among the Company, the Adviser, the Administrator and the Sub-Administrator. The Company shall not be liable for the fulfillment of any obligation of the Adviser, the Administrator or the Sub-Administrator under or in connection with this Subscription Agreement. The Adviser shall not be liable for the fulfillment of any obligation or for the accuracy of any representation of the Company, the Administrator or the Sub-Administrator under or in connection with this Subscription Agreement. The Administrator shall not be liable for the fulfillment of any obligation or for the accuracy of any representation of the Company, the Adviser or the Sub-Administrator under or in connection with this Subscription Agreement. The Sub-Administrator shall not be liable for the fulfillment of any obligation or for the accuracy of any representation of the Company, the Adviser or the Administrator under or in connection with this Subscription Agreement. There shall be no joint and several liability of the Company, the Adviser, the Administrator or the Sub-Administrator for any obligation under or in connection with this Subscription Agreement.

16.   Independent Nature of Investors’ Obligations and Rights. The obligations of the Investor hereunder are several and not joint with the obligations of any Other Investor. Nothing contained herein or in any other agreement or document delivered at any closing, and no action taken by the Investor pursuant hereto or thereto, shall be deemed to constitute the Investors as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Investors are in any way acting in concert with respect to such obligations or the transactions contemplated by this Subscription Agreement.

 

 

**

 

 

18

 

IN WITNESS WHEREOF, the undersigned has executed this Subscription Agreement on the date set forth below.

 

							
	
Date:
	
 
	
 
	
Amount of Capital Commitment:

	
 
	
 
	
 
	
$
	
 

	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
PARTNERSHIP, CORPORATION, LIMITED LIABILITY COMPANY, TRUST, EMPLOYEE BENEFIT PLAN, OTHER INVESTOR:

	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
(Name of Entity)

	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
By:
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
(Signature)

	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
(Print Name and Title)

 

 

 

 

 

 

 

ACCEPTANCE OF SUBSCRIPTION

The Company hereby accepts the above application for subscription for Shares.

Amount of Capital Commitment:

 

	
$
	
 
	
 
	
 
	
 
	
 
	
	
 
	
 
	
Accepted:
		
	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
BC PARTNERS LENDING CORPORATION
		
	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
By:
	
 
	
 

	
 
	
 
	
 
	
Name:
	
 

	
 
	
 
	
 
	
Title:
	
 

 

Date:  _________________________________

 

 

 

 

 

 

[Acceptance of Subscription BC Partners Lending Corporation]

 

BC Partners Lending Corporation

INVESTOR QUESTIONNAIRE

A.General Information

	
1.        Print Full Name of Investor:
	
 
	
Partnership, Corporation, Trust, Limited Liability Company, Employee Benefit Plan, Other Investor:

	
 
	
 
	
 

	
 
	
 
	
Name of Entity

	
 
	
 
	
Legal form of entity (trust, corporation, partnership, limited liability company, benefit plan, etc.)

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
Jurisdiction of organization:                                    

 

2.    Please indicate Investor type (All Investors must select only one of the options below):

 

	
☐
	
 
	
(A)
	
 
	
Individual that is a “United States Person” as defined in Rule 203(m)-1 under the U.S. Investment Advisers Act of 1940, as amended (the “Advisers Act”) (including a trust of any such individual).

	
☐
	
 
	
(B)
	
 
	
Individual that is not a “United States Person” as defined in Rule 203(m)-1 under the Advisers Act (including a trust of any such individual).

	
☐
	
 
	
(C)
	
 
	
Broker-dealer.

	
☐
	
 
	
(D)
	
 
	
Insurance company.

	
☐
	
 
	
(E)
	
 
	
Investment company registered with the U.S. Securities and Exchange Commission under the U.S. Investment Company Act of 1940, as amended (the “1940 Act”).

	
☐
	
 
	
(F)
	
 
	
An issuer that would be an investment company as defined in Section 3 of the 1940 Act but for Section 3(c)(1) or 3(c)(7) thereof.

	
☐
	
 
	
(G)
	
 
	
Non-profit organization.

	
☐
	
 
	
(H)
	
 
	
Pension plan (excluding governmental pension plans).

	
☐
	
 
	
(I)
	
 
	
Banking or thrift institution (proprietary).

	
☐
	
 
	
(J)
	
 
	
Any state or political subdivision of a state, including (i) any agency, authority, or instrumentality of the state or political subdivision; (ii) a plan or pool of assets controlled by the state or political subdivision or any agency, authority, or instrumentality thereof; and (iii) any officer, agent, or employee of the state or political subdivision or any agency, authority, or instrumentality thereof, acting in its official capacity (excluding governmental pension plans).

	
☐
	
 
	
(K)
	
 
	
State or municipal governmental pension plan.

	
☐
	
 
	
(L)
	
 
	
Sovereign wealth fund or foreign official institution.

	
☐
	
 
	
(M)
	
 
	
Other.

 

BC Partners Lending Corporation

 

 

				
	
3.     Address for Notices:
	
 

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
 

	
4.     Telephone Number:
	
 

	
 
	
 

	
5.     Facsimile Number:
	
 

	
 
	
 

	
6.     Permanent Address:
	
 

	
(if different from address in A3 above)
	
 

	
 
	
 

	
 
	
 

	
7.     U.S. Taxpayer Identification
	
 

	
Number or Social Security
	
 

	
Number (if a U.S. Person):
	
 

	
 
	
 

	
8.     E-mail Address:
	
 

	
 
	
 

	
If the Investor does not wish to receive notices by electronic mail, the Investor should provide a written notice which represents as to the legal or established policy prohibitions which preclude receipt of such notices, reports and other information by electronic mail or web-based reporting.

	
9.     Primary Contact Person for this Account:
	
 

	
 
	
Name:
	
 
	
 

	
 
	
Address:
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
Telephone:
	
 
	
 

	
 
	
Fax:
	
 
	
 

 

	
10.
	
Authorized Representative:

The following individual or individuals are authorized to act on behalf of the Investor to give and receive instructions between the Company (or its representatives) and the Investor.  Such individuals are the only persons so authorized until further written notice, signed by one or more of such individuals.  Please print name and contact information exactly as it should be printed on all financial/official documents/correspondence.  Include all spaces and capitalization.

 

	
Print Full Name of Authorized Representative:
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
First
	
Middle
	
Last

– 2 –

BC Partners Lending Corporation

 

 

			
	
Relation of Authorized Representative to Investor:
	
 

	
 
	
 
	
 

	
 
	
Director, Managing Member, General Partner, Trustee 

	
 
	
Other
	
 

	
 
	
 
	
 

	
 
	
(provide document evidencing authority to act on behalf of Investor):

	
 
	
 

 

	
 
	
 
	
Signature

	
Address for Notices:
	
 
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 

	
Telephone Number:
	
 
	
 
	
 

	
 
	
 
	
 
	
 

	
Facsimile Number:
	
 
	
 
	
 

	
 
	
 
	
 
	
 

	
E-mail Address:
	
 
	
 
	
 

 

	
11.
	
If you do not wish to be enrolled in the Dividend Reinvestment Plan, check the box below and complete wiring instructions below. Check this box ONLY if you do NOT wish to enroll in the Dividend Reinvestment Plan and you instead elect to receive cash distributions.

 

☐

If you have checked the box above, please complete the following wiring instructions for distributions of cash. Do not complete this section if you wish to be enrolled in the Dividend Reinvestment Plan: 

 

For distributions of cash to bank accounts in the United States or Canada, please wire funds to the following bank account:

 

Bank Name:____________________________________________________________________

Bank Address:__________________________________________________________________

Bank Routing Number and Account Number:__________________________________________

International BIC or Swift Code: ___________________________________________________

Transit Number (Canada only):_____________________________________________________

Telephone Number of Bank:_________________ Fax Number of Bank:____________________

Name of Banking Officer:_________________________________________________________

 

If the wire is routed through a financial institution other than a bank (e.g., brokerage house):

Financial Institution Name:________________________________________________________

Financial Institution Address:______________________________________________________

– 3 –

BC Partners Lending Corporation

 

Account Numbers:_______________________________________________________________

 

For Further Credit to: (if any)

Account Name:_________________________________________________________________

Account Number:________________________________________________________________

International Bank Account Number (IBAN): _________________________________________

Reference:

 

	
	
 

 

If payment is to an account outside the United States or Canada, please include the following:

Bank Name:____________________________________________________________________

Bank Address:__________________________________________________________________

International BIC or Swift Code:_________________________________________________and

IBAN Number:*_________________________________________________________________

Telephone Number of Bank:___________________ Fax Number of Bank:__________________

Name of Banking Officer:_________________________________________________________

Reference:_____________________________________________________________________

* IBAN= International Bank Account Number

 

Please be advised that any disbursements will automatically be sent as indicated above unless the Company is notified otherwise in writing.

 

	
12(a).
	
Is the bank located in an Administrator Approved Country2?

☐ Yes☐ No

If yes, please answer question 12(b) below.

	
12(b).
	
Is the Investor a customer of the bank?

☐ Yes☐ No

If either question above was answered “No,” please contact Simpson Thacher & Bartlett LLP for additional information that will be required.  

 

	
13.
	
(a)  Please provide a brief statement describing the source of funds used to make this investment:_____________________________________________________________________

(b)  Please submit a record of the source of funds used to make this investment, as discussed in the instructions. 

	
	 

	
2     As of the date hereof, countries that are approved members of the Financial Action Task Force on Money Laundering
(each, an “Approved FATF Country”) are:  Australia, Austria, Bahamas, Belgium, Bermuda, Canada, Cayman Islands,
Channel Islands, Denmark, Finland, France, Germany, Hong Kong, Iceland, Ireland, Isle of Man, Italy, Japan, Luxembourg,
Kingdom of the Netherlands, Malta, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, United
Kingdom and the United States.
	

– 4 –

BC Partners Lending Corporation

 

B.U.S. / Non-U.S. and Related Tax Information  

The Investor represents and warrants that:

	
☐
	
it (a) is a U.S. Person (as defined herein); (b) is not a non-resident alien individual, foreign corporation, foreign partnership, foreign trust or foreign estate (each as defined in the Code); and (c) will notify the Company immediately of any change in the status referenced in the foregoing clause (a) of this Section B.  The Investor agrees to execute properly and provide to the Company in a timely manner any tax documentation that may be reasonably required in connection with the Company (including any information required to comply with any International Tax Reporting Regime), and will inform the Company in writing of any change in the information contained in such documentation within 30 days of such change and provide the Company with any updated forms whenever those expire or the information provided has changed.  The Investor will complete and return with this Subscription Agreement a completed and executed Form W-9. 

The Investor certifies under penalties of perjury that the Investor’s name, taxpayer identification number, if any, and address provided in the Investor Questionnaire are correct. 

C.Accredited Investor Status

The Investor represents and warrants that the Investor is an “accredited investor” within the meaning of Rule 501 of Regulation D under the U.S. Securities Act, of 1933, as amended (the “Securities Act”) and has checked the box or boxes below that are next to the category or categories under which the Investor qualifies as an accredited investor:

	
☐
	
A natural person with individual net worth (or joint net worth with spouse) in excess of $1 million. For purposes of this item, “net worth” means the excess of total assets at fair market value, including automobiles and other personal property but excluding the value of the primary residence of such natural person (and including property owned by a spouse other than the primary residence of the spouse), over total liabilities. (For this purpose, the amount of any mortgage or other indebtedness secured by an investor’s primary residence should not be included as a “liability”, except to the extent (i) the fair market value of the residence is less than the amount of such mortgage or other indebtedness, or (ii) such indebtedness existing on the date of the acceptance of the Investor’s subscription for Shares exceeds the indebtedness that existed 60 days preceding such date and such indebtedness was not as a result of the acquisition of the Investor’s primary residence).

	
☐
	
A natural person with individual income (without including any income of the Investor’s spouse) in excess of $200,000, or joint income with spouse of $300,000, in each of the two most recent years and who reasonably expects to reach the same income level in the current year.

	
☐
	
An entity, including a grantor trust, in which all of the equity owners are accredited investors (for this purpose, a beneficiary of a trust is not an equity owner, but the grantor of a grantor trust is an equity owner).

	
☐
	
A bank as defined in Section 3(a)(2) of the Securities Act, or any savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Securities Act, whether acting in its individual or fiduciary capacity.

	
☐
	
An insurance company as defined in Section 2(a)(13) of the U.S. Securities Act.

– 5 –

BC Partners Lending Corporation

 

	
☐
	
A broker-dealer registered pursuant to Section 15 of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”).

	
☐
	
An investment company registered under the 1940 Act.

	
☐
	
A business development company as defined in Section 2(a)(48) of the 1940 Act.

	
☐
	
A small business investment company licensed by the Small Business Administration under Section 301(c) or (d) of the U.S. Small Business Investment Act of 1958, as amended.

	
☐
	
A private business development company as defined in Section 202(a)(22) of the Advisers Act.

	
☐
	
An organization described in Section 501(c)(3) of the Code, a corporation, Massachusetts or similar business trust, limited liability company or partnership, not formed for the specific purpose of acquiring Shares, with total assets in excess of $5 million.

	
☐
	
A trust with total assets in excess of $5 million not formed for the specific purpose of acquiring Shares, whose purchase is directed by a person with such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of an investment in the Shares. 

	
☐
	
An employee benefit plan within the meaning of the U.S. Employee Retirement Income Security Act of 1974, as amended (“ERISA”) if the decision to invest in the Shares is made by a plan fiduciary, as defined in Section 3(21) of ERISA, that is either a bank, savings and loan association, insurance company, or registered investment adviser, or if the employee benefit plan has total assets in excess of $5 million or, if a self-directed plan, with investment decisions made solely by persons that are accredited investors.

	
☐
	
A plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions for the benefit of its employees, if the plan has total assets in excess of $5 million.

– 6 –

BC Partners Lending Corporation

 

D.Supplemental Data

 

	
1(a).
	
Is the Investor (a) a trust any portion of which is treated (under subpart E of part I of subchapter J of chapter 1 of subtitle A of the Code) as owned by a natural person (e.g., a grantor trust) or (b) an entity disregarded for U.S. federal income tax purposes and owned (or treated as owned) by a natural person or a trust described in clause (a) of this sentence (e.g., a limited liability company with a single member)?

☐ Yes☐ No

If the answer to the above question is “Yes,” please contact Simpson Thacher & Bartlett LLP for additional information that will be required.

	
1(b).
	
Is the Investor (a) an organization described in Section 401(a), Section 501(c)(17) or Section 509(a) of the Code, or (b) a trust permanently set aside or to be used for a charitable purpose?

☐ Yes☐ No

	
2.
	
Is the Investor a private investment company that is exempt from registration under the 1940 Act in reliance on:

Section 3(c)(1) thereof?              ☐ Yes☐ No

Section 3(c)(7) thereof?              ☐ Yes☐ No

	
3.
	
Is the Investor (i) an “investment company” registered under the Investment Company Act; or (ii) a “business development company,” as defined in Section 202(a)(22) of the Advisers Act; or has the Investor elected to be regulated as “business development company” pursuant to Section 54 of the 1940 Act?

☐ Yes☐ No

	
4. 
	
Does the amount of the Investor’s subscription for Shares of the Company exceed 40% of the total assets (on a consolidated basis with its subsidiaries) of the Investor or, if the Investor is a private investment fund with binding, unconditional commitments from the Investor’s shareholders, partners, members or other beneficial owners, more than 40% of such commitments?

☐ Yes☐ No

If the answer to the above question is “Yes,” please contact Simpson Thacher & Bartlett LLP for additional information that will be required.

	
5.
	
Are shareholders, partners or other holders of equity or beneficial interests in the Investor able to decide individually whether to participate, or the extent of their participation, in the Investor’s investment in the Company (i.e., can shareholders, partners or other holders of equity or beneficial interests in the Investor determine whether their capital will form part of the capital invested by the Investor in the Company)?

☐ Yes☐ No

If the answer to the above question is “Yes,” please contact Simpson Thacher & Bartlett LLP for additional information that will be required.

– 7 –

BC Partners Lending Corporation

 

	
6(a)
	
Please indicate whether or not the Investor is, or is acting (directly or indirectly) on behalf of, (i) an employee benefit plan (within the meaning of Section 3(3) of ERISA), whether or not such plan is subject to Title I of ERISA, (ii) a plan, individual retirement account or other arrangement that is described in Section 4975 of the Code, whether or not such plan, account or arrangement is subject to Section 4975 of the Code, (iii) a plan, fund or other similar program that is established or maintained outside the United States which provides for retirement income, a deferral of income in contemplation of retirement or payments to be made upon termination of employment, (iv) an insurance company using general account assets, if such general account assets are deemed to include the assets of any of the foregoing types of plans, accounts or arrangements for purposes of Title I of ERISA or Section 4975 of the Code under Section 401(c)(1)(A) of ERISA or the regulations promulgated thereunder, or (v) an entity which is deemed to hold the assets of any of the foregoing described in clauses (i), (ii), (iii) or (iv) (each of the foregoing described in clauses (i), (ii), (iii), (iv) and (v) being referred to as a “Plan”).

☐ Yes☐ No

	
6(b)
	
Please indicate whether or not the Plan is subject to Title I of ERISA or Section 4975 of the Code.

☐ Yes☐ No

	
6(c)
	
If the answer to the question above is “Yes”, please indicate what percentage of the Plan’s assets invested in the Company are the assets of “benefit plan investors” within the meaning of Section 3(42) of ERISA:

____________%

	
6(d)
	
If the Investor is investing the assets of an insurance company general account, please indicate what percentage of the insurance company general account’s assets invested in the Company constitute “plan assets” within the meaning of Section 401(c)(1)(A) of ERISA and the regulations promulgated thereunder:

____________%

	
6(e)
	
Please indicate whether the Investor is, or is acting (directly or indirectly) on behalf of:

	
 
	
☐
	
A qualified pension or profit sharing trust (i.e., one that is exempt from taxation under Section 501(a) of the Code by qualifying under Section 401(a) of the Code).

	
 
	
☐
	
A governmental plan (i.e., a plan (1) that is established and maintained for its employees by the government of the United States, by the government of any State or political subdivision thereof, or by any agency or instrumentality of any of the foregoing, (2) to which the U.S. Railroad Retirement Act of 1935 or 1937, as amended, applies and that is financed by contributions required under such Act, or (3) of an international organization that is exempt from taxation by reason of the U.S. International Organizations Immunities Act).

	
 
	
☐
	
An eligible deferred compensation plan under Section 457(b) of the Code.

	
 
	
☐
	
The government of the United States, the government of any State or political subdivision thereof, any agency or instrumentality of any of the foregoing, or any other exempt organization described in Section 818(a)(6)(B) of the Code, but only to the extent such entity is investing in the Company in order to satisfy its obligations under a governmental plan or an eligible deferred compensation plan.

	
 
	
☐
	
An individual retirement account that is exempt from taxation under Section 408(e) of the Code.

– 8 –

BC Partners Lending Corporation

 

	
7.
	
If the Investor is not a “benefit plan investor” within the meaning of Section 3(42) of ERISA, please indicate whether the Investor is (i) a Person (including an entity) who has discretionary authority or control with respect to any assets of the Company, or (ii) a Person (including an entity) who provides investment advice for a fee (direct or indirect) with respect to any assets of the Company, or any “affiliate” of any such Person. For purposes of this representation, an “affiliate” is any Person controlling, controlled by or under common control with the Company or any of its investment advisers (including the Adviser), including by reason of having the power to exercise a controlling influence over the management or policies of the Company or its investment adviser(s).

☐ Yes☐ No

	
8.
	
Is the Investor a “BHC Investor” as such term is defined in Section 2(a) of the Bank Holding Company Act of 1956, as amended?

☐ Yes☐ No

	
9.
	
Is the Investor subject to the U.S. Freedom of Information Act, 5 U.S.C. § 552, (“FOIA”), any state public records access law, a law of any state or other jurisdiction similar in intent or effect to FOIA, or any other similar statutory or legal right or obligation that might result in the disclosure of confidential information relating to the Company?

☐  Yes☐ No

If the question above was answered “Yes,” please indicate the relevant law(s) to which the Investor is subject and provide any additional explanatory information in the space below:

 

	
	
 

	
 

 

	
 

 

 

	
10(a).
	
Is the Investor a governmental entity or any political subdivision thereof, whether state or local, or any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government?

☐ Yes☐ No

	
10(b).
	
If question 14(a) was answered “Yes,” is the Investor entitled to any sovereign or other immunity in respect of itself, its property, or any litigation in any jurisdiction, court, or venue? 

 

☐ Yes☐ No

If question 14(b) was answered “Yes,” please contact Simpson Thacher & Bartlett LLP for additional information that will be required. Notwithstanding any response to this question 14(b), the Investor hereby confirms that nothing herein shall relieve the Investor of or modify any obligations that the Investor may have under the Subscription Agreement to contribute capital to the Company in accordance with the terms and conditions of the Memorandum and the Subscription Agreement. A lender which provides financing to the Company may rely on this paragraph. 

– 9 –

BC Partners Lending Corporation

 

	
11.
	
Please indicate whether the Investor is a single legal entity or “legal person” with “legal personality” in its jurisdiction of organization?

☐ Yes☐ No

If the question above was answered “No,” then please list the names of all beneficial owners of the Investor until each such beneficial owner is a single legal entity or “legal person” with “legal personality” in its jurisdiction of organization.

 

	
	
 

	
 

 

	
 

 

	
 

 

	
 

 

 

If the Investor has further questions with respect to the foregoing question, please contact Simpson Thacher & Bartlett LLP.

	
12.
	
If the Investor is (i) a government entity, (ii) acting as trustee, custodian or nominee for a beneficial owner that is a government entity, or (iii) an entity substantially owned by a government entity (e.g., a single investor vehicle) and the investment decisions of such entity are made or directed by such government entity, the Investor hereby certifies that other than the Pay to Play Rule, no “pay to play” or other similar compliance obligations would be imposed on the Company, the Adviser or their affiliates in connection with the Investor’s subscription.

If the Investor cannot make such certification, indicate in the space below all other “pay to play” laws, rules or guidelines, or lobbyist disclosure laws or rules, the Company, the Adviser or their affiliates, employees or third-party placement agents would be subject to in connection with the Investor’s subscription:

 

	
	
 

– 10 –

BC Partners Lending Corporation

 

E.Related Parties and Third Party Referrals

	
1.
	
To the best of the Investor’s knowledge, does the Investor control, or is the Investor controlled by or under common control with, any other investor in the Company?

☐ Yes☐ No

If question 1 was answered “Yes,” please identify such related investor(s) below.

Names of related investor(s): __________________________________________

	
2.
	
Will any other person or entity have a beneficial interest in the Shares to be acquired hereunder (other than as a shareholder, partner, policy owner or other beneficial owner of equity interests in the Investor)?  (By way of example, and not limitation, “nominee” Investors or Investors who have entered into swap or other synthetic or derivative instruments or arrangements with regard to the Shares to be acquired herein would be required to check “Yes” below.)

☐ Yes☐ No

If either question above was answered “Yes,” please contact Simpson Thacher & Bartlett LLP for additional information that will be required.

	
3.
	
Has the Investor been referred to the Company by an external third-party (not an employee of BC Partners)?

☐ Yes☐ No

 If yes, please provide the name of the third-party:

_________________________________________________________

	
4.
	
If question 3 was answered “Yes,” in connection with the third-party referral, did the Investor receive a disclosure statement acknowledging any fees that such third-party may receive in connection with such referral and certain other matters related thereto?

☐ Yes☐ No

If either question 3 or 4 above was answered “Yes,” please contact Simpson Thacher & Bartlett LLP for additional information that will be required.

– 11 –

BC Partners Lending Corporation

 

F. Liquidity Option

	
1.
	
Does the Investor elect to Participate in the Initial Reorganization, pursuant to which the Investor will have the option to exchange its Shares and any remaining commitment, or a portion of their Shares and any remaining commitment, in a Liquidating Company? The Liquidating Company generally would seek to liquidate and would generally distribute the proceeds of its investments, as they are received, to its equity holders over time, such that it would likely substantially complete its liquidation within a reasonable period of time following the date of the Initial Reorganization.

☐ Yes (100% of Shares and remaining Commitment) 

☐ Yes (_______% of Shares and remaining Commitment)

☐ No

It is anticipated that the Initial Reorganization, if initiated, would occur as soon as reasonably practicable following the end of the fiscal year during which the third anniversary of the Initial Closing occurs. The Investor may change the election indicated above by notifying the Company at any time in writing at least 90 days prior to the end of the fiscal year during which the third anniversary of the Initial Closing date occurs after which such election will be deemed irrevocable. SEC exemptive relief, if granted, may impact the process by which investors elect to participate in any Reorganization.

– 12 –

BC Partners Lending Corporation

 

G.Anti-Money Laundering

Please fill out the following table including the name and country of citizenship for:

	
(i)
	
each individual that is a director and significant3 shareholder if the Investor is a corporation;

	
(ii)
	
the ultimate owner(s) of the Investor’s general partner(s) and significant1 limited partners if the Investor is a partnership;

	
(iii)
	
the ultimate owner(s) of the Investor’s managing members and significant1 members if the Investor is a limited liability company; or

	
(iv)
	
the Investor’s settlor and/or grantor, trustees and beneficiaries if the Investor is a trust.  

 

		
	
Name
	
Country of Citizenship

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
 

	
 
	
 

 

	
	 

	
3     “Significant” means a holder of more than 10% of the equity interests of the Investor.
	

– 13 –

BC Partners Lending Corporation

 

H.Benefit Plan Questionnaire 

	
 
	
I.
	
The Investor represents that it is (please check all applicable boxes):

	
 
	
A.
	
☐not a Benefit Plan Investor* (Code: NBPI); or 

* A “Benefit Plan Investor” is (i) any plan subject to Title 1 or ERISA (e.g., U.S. corporate plans), (ii) any plan subject to Section 4975 of the Code (e.g., IRAs) and (iii) any passive investment fund whose underlying assets include “plan assets” (generally because plans (described in (i) or (ii)) own 25% or more of a class of the investment fund’s equity interests).  Any entity that is a Benefit Plan Investor by virtue of (iii) above should check I-B.3 below.

 

If the box above is not checked, please complete the remainder of this Benefit Plan Questionnaire. 

 

	
 
	
B.
	
☐a Benefit Plan Investor that is:

	
 
	
1.
	
☐An employee benefit plan or trust that is subject to the fiduciary provisions of ERISA – this includes U.S. pension plans and U.S. profit-sharing and 401(k) plans, “Multiemployer Plans” and “Taft-Hartley Plans” but does not include U.S. governmental plans, certain church plans and non-U.S. employee pension and welfare benefit plans (Code:  ERISA);

	
 
	
2.
	
☐A U.S. individual retirement account, Keogh Plan and/or other plan subject to Section 4975 of the Code (Code:  E-IRC);

	
 
	
3.
	
☐An entity (e.g. a fund of funds) whose underlying assets include “plan assets” by reason of a plan’s investment in the entity and such plan investors include  (1)  one or more U.S. pension benefit plans, welfare benefit plans or similar plans subject to ERISA and/or  (2)  one or more individual retirement accounts, Keogh plans or other individual arrangement subject to Section 4975(e)(1) of the IRC (including by reason of 25% or more of any class of equity interests in the entity being held by Benefit Plan Investors that include any plan described above)  (Code:  E-25%+).

If the Investor is an entity whose underlying assets include “plan assets,” indicate that the percentage of such assets that constitute “plan assets” within the meaning of ERISA or the IRC is not more than (please check an applicable box):

 

	
☐
	
10%**
	
☐
	
20%**
	
☐
	
30%
	
☐
	
40%
	
☐
	
50%

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
☐
	
60%
	
☐
	
70%
	
☐
	
80%
	
☐
	
90%
	
☐
	
100%

 

**Applicable to entities with multiple classes, one of which exceeds the 25% threshold for Benefit Plan Investors.

The Investor agrees to promptly notify the Sub-Administrator in writing if there is a change in the percentage as set forth above and at such time or times as the Company, the Adviser and/or the Sub-Administrator may request.

 

– 14 –

BC Partners Lending Corporation

 

	
 
	
II.
	
Insurance Company

If the Investor is an insurance company, please certify to either 1 or 2 below:

	
 
	
1.
	
☐ The Investor is an insurance company investing the assets of its general account (or the assets of a wholly owned subsidiary of its general account) in the Fund but none of the underlying assets of the Investor’s general account constitute “plan assets” within the meaning of Section 401(c) of ERISA.

	
 
	
2.
	
☐ The Investor is an insurance company investing the assets of its general account (or the assets of a wholly owned subsidiary of its general account) in the Fund and the percentage of the underlying assets of the Investor’s general account deemed to be “plan assets” within the meaning of Section 401(c) of ERISA is not more than (please check an applicable box) (Code:  E-ICGA):

 

	
☐
	
10%
	
☐
	
20%
	
☐
	
30%
	
☐
	
40%
	
☐
	
50%

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
☐
	
60%
	
☐
	
70%
	
☐
	
80%
	
☐
	
90%
	
☐
	
100%

 

The Investor agrees to promptly notify the Sub-Administrator in writing if there is a change in the percentage as set forth above and at such time or times as the Company, the Adviser and/or the Sub-Administrator may request.

Person(s) or affiliate(s) with control over assets/providing investment advice 

(TO BE COMPLETED BY ALL INVESTORS THAT ARE NOT BENEFIT PLAN INVESTORS)

If the Investor is not a Benefit Plan Investor, please indicate whether you are (i) a person (including an entity) who has discretionary authority or control with respect to the assets of the Company or (ii) a person (including an entity) who provides investment advice for a fee (direct or indirect) with respect to such assets or an “affiliate” of any such person described in (i) and/or (ii).  For purposes of this representation, an “affiliate” is any person controlling, controlled by or under common control with the Company or any of its investment advisers (including the Adviser), including by reason of having the power to exercise a controlling influence over the management or policies of the Company or its investment adviser(s).

Yes:  _______  (Code: IM&A);No:  _______

 

 

– 15 –

BC Partners Lending Corporation

 

The Investor understands that the foregoing information will be relied upon by the Company, the Adviser, and their affiliates for the purpose of determining the eligibility of the Investor to purchase and own Shares of the Company. The representation and warranties set forth in this Subscription Agreement and the information provided in the Investor Questionnaire shall be deemed repeated and reaffirmed by the Investor to the Company as of each date that the Investor is required to make a Capital Contribution to the Company and the Investor agrees to notify the Company promptly if any representation, warranty or information contained in this Subscription Agreement, including this Investor Questionnaire, becomes untrue or incomplete at any time.  The Investor agrees to provide such information and execute and deliver such documents regarding itself and all of its beneficial owners as the Company may reasonably request from time to time to substantiate the Investor’s status as an accredited investor, a qualified purchaser or to otherwise determine the eligibility of the Investor to purchase Shares of the Company, to verify the accuracy of the Investor’s representations and warranties herein or to comply with any law, rule or regulation to which the Company and/or the Adviser may be subject, including compliance with anti-money laundering laws and regulations. To the fullest extent permitted by law, the Investor agrees to indemnify and hold harmless the Company and/or the Adviser and other Indemnified Persons from and against any loss, damage or liability due to or arising out of a breach of any representation, warranty or agreement of the Investor contained in this Subscription Agreement (including the Investor Questionnaire) or in any other document provided by the Investor to the Company or in any agreement executed by the Investor with the Company in connection with the Investor’s investment in a Share.

Signatures:

 

		
	
PARTNERSHIP, CORPORATION, LIMITED LIABILITY COMPANY, TRUST, EMPLOYEE BENEFIT PLAN, OTHER INVESTOR:

	
 

	
(Name of Entity)

	
By:
	
 

	
(Signature)

	
 

	
(Print Name and Title)bcpl-ex42_279.htm

Exhibit 4.2

Description of Capital Stock

As of December 31, 2019, BC Partners Lending Corporation had one class of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”): its common stock, par value 0.001 per share. References herein to “we,” “us,” “our” and “Company” refers to BC Partners Lending Corporation.

The following description of our common stock is a summary and does not purport to be complete. It is subject to and qualified in its entirety by reference to our Articles of Amendment and Restatement (the “charter”), and our Amended and Restated Bylaws (the “bylaws”), each of which is incorporated by reference as an exhibit to the Annual Report on Form 10-K of which this Exhibit is a part. We encourage you to read the Articles, Bylaws and the applicable provisions of Maryland General Corporation Law (the “MGCL”) for additional information.

General

Under the terms of our charter, our authorized stock consists of 1 billion shares of common stock, par value $0.001 per share, all of which are initially designated as common stock. There are no outstanding options or warrants to purchase our stock. No stock has been authorized for issuance under any equity compensation plans.

As permitted by the MGCL, our charter provides that a majority of the entire board of directors of the Company (the “Board of Directors”), without any action by our stockholders, may amend our charter 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. Our charter also provides that the Board of Directors may classify or reclassify any unissued shares of our common stock into one or more classes or series of our common stock or preferred stock by setting or changing the preferences, conversion or other rights, voting powers, restrictions, or limitations as to dividends, qualifications, or terms or conditions of redemption of the shares. There is currently no market for our stock, and we can offer no assurances that a market for our stock will develop in the future. We do not currently intend for our shares to be listed on any national securities exchange, although it is possible that they would be listed in the future. Under Maryland law, our stockholders generally are not personally liable for our debts, except as they may be liable by reason of their own conduct or acts. Unless the Board of Directors determines otherwise, we will issue all shares of its stock in uncertificated form.

None of our shares of common stock are subject to further calls or to assessments, sinking fund provisions, obligations of the Company or potential liabilities associated with ownership of the security (not including investment risks).

Common Stock

Under the terms of our charter, all shares of our common stock have equal rights as to dividends, distributions and voting and, when they are issued, will be duly authorized, validly issued, fully paid and nonassessable. Dividends and distributions may be paid to our stockholders if, as and when authorized by the Board of Directors and declared by the Company out of funds legally available therefor. Shares of our common stock have no preemptive, 

 

Exhibit 4.2

exchange, conversion or redemption rights and our stockholders generally have no appraisal rights. Shares of our common stock are freely transferable, except where their transfer is restricted by federal and state securities laws or by contract and except that, in order to avoid the possibility that our assets could be treated as “plan assets,” we may require any person proposing to acquire shares of our common stock to furnish such information as may be necessary to determine whether such person is a Benefit Plan Investor (within the meaning of Section 3(42) of the U.S. Employee Retirement Income Security Act of 1974, as amended and certain Department of Labor regulations) or a controlling person, restrict or prohibit transfers of shares of such stock or redeem any outstanding shares of stock for such price and on such other terms and conditions as may be determined by or at the direction of the Board of Directors. 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 or otherwise provide for 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. Subject to the rights of holders of any other class or series of stock, each share of our common stock is entitled to one vote on all matters submitted to a vote of our stockholders, including the election of directors, and our stockholders will possess the exclusive voting power. There will be no cumulative voting in the election of directors. Cumulative voting entitles a stockholder to as many votes as equals the number of votes which such holder would be entitled to cast for the election of directors multiplied by the number of directors to be elected and allows a stockholder to cast a portion or all of the stockholder’s votes for one or more candidates for seats on the Board of Directors. Without cumulative voting, a minority stockholder may not be able to elect as many directors as the stockholder would be able to elect if cumulative voting were permitted. Subject to the special rights of the holders of any class or series of preferred stock to elect directors, each director will be elected by a majority of the votes cast with respect to such director’s election, except in the case of a “contested election” (as defined in our bylaws), in which directors will be elected by a plurality of the votes cast in the contested election of directors.

Preferred Stock

Under the terms of our charter, the Board of Directors may authorize us to issue shares of preferred stock in one or more classes or series, without stockholder approval, to the extent permitted by the Investment Company Act of 1940, as amended (the “1940 Act”). The Board of Directors has the power to fix the preferences, conversion and other rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications and terms and conditions of redemption of each class or series of preferred stock. We do not currently anticipate issuing preferred stock in the near future. In the event we issue preferred stock, we will make any required disclosure to our stockholders. We will not offer preferred stock to the Adviser or our affiliates except on the same terms as offered to all other stockholders.

Preferred stock could be issued with terms that would adversely affect our stockholders. Preferred stock could also be used as an anti-takeover device through the issuance of shares of a class or series of preferred stock with terms and conditions which could have the effect of 

 

Exhibit 4.2

delaying, deferring or preventing a transaction or a change in control. Every issuance of preferred stock will be required to comply with the requirements of the 1940 Act. The 1940 Act requires, among other things, that: (1) immediately after issuance and before any dividend or other distribution is made with respect to our common stock and before any purchase of our common stock is made, such preferred stock together with all other senior securities must not exceed an amount equal to 50% of our total assets after deducting the amount of such dividend, distribution or purchase price, as the case may be, and (2) the holders of shares of preferred stock, if any are issued, must be entitled as a class voting separately to elect two directors at all times and to elect a majority of the directors if distributions on such preferred stock are in arrears by two full years or more. Certain matters under the 1940 Act require the affirmative vote of the holders of at least a majority of the outstanding shares of preferred stock (as determined in accordance with the 1940 Act) voting together as a separate class. For example, the vote of such holders of preferred stock would be required to approve a proposal involving a plan of reorganization adversely affecting such securities.

The issuance of any preferred stock must be approved by a majority of the independent directors not otherwise interested in the transaction, who will have access, at our expense, to our legal counsel or to independent legal counsel.

Limitation on Liability of Directors; Indemnification and Advance of Expenses

Maryland law permits a Maryland corporation to include in its charter a provision eliminating the liability of its directors and officers to the corporation and its stockholders for money damages except for liability resulting from (a) actual receipt of an improper benefit or profit in money, property or services or (b) active and deliberate dishonesty that is established by a final judgment and is material to the cause of action. Our charter contains a provision that eliminates directors’ and officers’ liability, subject to the limitations of Maryland law and the requirements of the 1940 Act.

Maryland law requires a corporation (unless its charter provides otherwise, which our charter does not) to indemnify a director or officer who has been successful in the defense of any proceeding to which he or she is made or threatened to be made a party by reason of his or her service in that capacity against reasonable expenses actually incurred in the proceeding in which the director or officer was successful. Maryland law permits a corporation to indemnify its present and former directors and officers, among others, against judgments, penalties, fines, settlements and reasonable expenses actually incurred by them in connection with any proceeding to which they may be made or threatened to be made a party by reason of their service in those or other capacities unless it is established that (1) the act or omission of the director or officer was material to the matter giving rise to the proceeding and (a) was committed in bad faith or (b) was the result of active and deliberate dishonesty; (2) the director or officer actually received an improper personal benefit in money, property or services; or (3) in the case of any criminal proceeding, the director or officer had reasonable cause to believe that the act or omission was unlawful. Under Maryland law, a Maryland corporation also may not indemnify for an adverse judgment in a suit by or on behalf of the corporation or for a judgment of liability on the basis that a personal benefit was improperly received, unless in either case a court orders 

 

Exhibit 4.2

indemnification, and then only for expenses. In addition, Maryland law permits a corporation to advance reasonable expenses to a director or officer upon the corporation’s receipt of (a) a written affirmation by the director or officer of his or her good faith belief that he or she has met the standard of conduct necessary for indemnification by the corporation and (b) a written undertaking by him or her or on his or her behalf to repay the amount paid or reimbursed by the corporation if it is ultimately determined that the standard of conduct was not met.

Our charter obligates us, subject to the limitations of Maryland law and the requirements of the 1940 Act, to indemnify (1) any present or former director or officer; (2) any individual who, while a director or officer and at our request, serves or has served another corporation, real estate investment trust, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise as a director, officer, partner, member, manager or trustee; or (3) the Adviser or any of its affiliates acting as an agent for us, from and against any claim or liability to which the person or entity may become subject or may incur by reason of such person’s service in that capacity, and to pay or reimburse such person’s reasonable expenses as incurred in advance of final disposition of a proceeding. These indemnification rights vest immediately upon an individual’s election as a director or officer. In accordance with the 1940 Act, we will not indemnify any person for any liability to the extent that such person would be subject by reason of such person’s willful misconduct, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of his, her or its office.

Maryland Law and Certain Charter and Bylaw Provisions; Anti-Takeover Measures

Maryland law contains, and our charter and bylaws also contain, 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 the Company to negotiate first with the 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, among other things, the Board of Director’s ability to negotiate such proposals may improve their terms.

Under the MGCL, a Maryland corporation generally cannot dissolve, amend its charter, merge, consolidate, convert into another form of business entity, sell all or substantially all of its assets or engage in a statutory share exchange unless declared advisable by the corporation’s board of directors and approved by the affirmative vote of our stockholders entitled to cast at least two-thirds of the votes entitled to be cast on the matter. A Maryland corporation may provide in its charter for approval of these matters by a lesser or greater percentage, but not less than a majority of all of the votes entitled to be cast on the matter. Subject to certain exceptions discussed below, our charter provides for approval of these actions by the affirmative vote of our stockholders entitled to cast a majority of the votes entitled to be cast on the matter.

Subject to certain exceptions provided in our charter, the affirmative vote of at least 75% of the votes entitled to be cast thereon, with the holders of each class or series of our stock voting 

 

Exhibit 4.2

as a separate class, in addition to the affirmative vote of at least 75% of the members of the Board of Directors, shall be necessary to effect any of the following actions:

 • any amendment to our charter to make our common stock a “redeemable security” or to convert the Company from a “closed-end company” to an “open-end company” (as such terms are defined in the 1940 Act);

 •any stockholder proposal as to specific investment decisions made or to be made with respect to our assets;

•any proposal as to the voluntary liquidation or dissolution of the Company or any amendment to our charter to terminate our existence;

 •any merger, consolidation or statutory share exchange of the Company with or into any other person; or

 • the sale of all or substantially all of our assets, as further described in our charter, when such sale is to be made other than in the ordinary course of our business.

However, if the proposal, transaction or business combination is approved by at least 75% of our continuing directors, the proposal, transaction or business combination may be approved only by the Board of Directors and, if necessary, our stockholders as otherwise would be required by applicable law, our charter and bylaws without regard to the supermajority approval requirements discussed above. A “continuing director” is defined in our charter as a director who (i) is not an interested party (meaning a person who has or proposes to enter into a business combination with us or owns more than 5% of any class of our stock) or an affiliate or an associate of an interested party and who has been a member of the Board of Directors for a period of at least 24 months (or since we commenced operations, if that period is less than 24 months); or (ii) is a successor of a continuing director who is not an interested party or an affiliate or an associate of an interested party and is recommended to succeed a continuing director by a majority of the continuing directors then in office or is nominated for election by our stockholders by a majority of the continuing directors then in office; or (iii) is elected to the Board of Directors to be a continuing director by a majority of the continuing directors then in office and who is not an interested party or an affiliate or associate of an interested party.

Our charter also provides that the Board of Directors is divided into three classes, as nearly equal in size as practicable, with each class of directors serving for a staggered three-year term. Additionally, subject to the rights of holders of one or more classes or series of preferred stock to elect or remove one or more directors, directors may be removed at any time, but only for cause (as such term is defined in our charter) and only by the affirmative vote of our stockholders entitled to cast at least 75% of the votes entitled to be cast generally in the election of directors, voting as a single class. Our charter and bylaws also provide that, except as provided otherwise by applicable law, including the 1940 Act and subject to any rights of holders of one or more classes or series of preferred stock to elect or remove one or more directors, any vacancy on the Board of Directors, except, until such time as we have three independent directors, for vacancies resulting from the removal of a director by our stockholders, and any 

 

Exhibit 4.2

newly created directorship resulting from an increase in the size of the Board of Directors, may only be filled by vote of the directors then in office, even if less than a quorum, or by a sole remaining director; provided that, under Maryland law, when the holders of any class, classes or series of stock have the exclusive power under our charter to elect certain directors, vacancies in directorships elected by such class, classes or series may be filled by a majority of the remaining directors so elected by such class, classes or series of our stock. In addition, our charter provides that, subject to any rights of holders of one or more classes or series of stock to elect or remove one or more directors, the total number of directors will be fixed from time to time exclusively pursuant to resolutions adopted by the Board of Directors.

The classification of the Board of Directors and the limitations on removal of directors described above as well as the limitations on our stockholders’ right to fill vacancies and newly created directorships and to fix the size of the Board of Directors could have the effect of making it more difficult for a third party to acquire the Company, or of discouraging a third party from acquiring or attempting to acquire the Company.

Maryland law and our charter and bylaws also provide that:

• any action required or permitted to be taken by our stockholders at an annual meeting or special meeting of our stockholders may only be taken if it is properly brought before such meeting or by unanimous consent in lieu of a meeting;

  • special meetings of our stockholders may only be called by the Board of Directors, the chairman of the Board of Directors or the chief executive officer, and must be called by the secretary upon the written request of our stockholders who are entitled to cast at least a majority of all the votes entitled to be cast on such matter at such meeting; and

 • from and after the Initial Closing, any stockholder nomination or business proposal to be properly brought before a meeting of our stockholders must have been made in compliance with certain advance notice and informational requirements.

Our charter also provides that any tender offer made by any person, including any “mini-tender” offer, must comply with the provisions of Regulation 14D of the Exchange Act, as amended, including the notice and disclosure requirements. Among other things, the offeror must provide us with notice of such tender offer at least ten business days before initiating the tender offer. Our charter prohibits any stockholder from transferring shares of stock to a person who makes a tender offer which does not comply with such provisions unless such stockholder has first offered such shares of stock to us at the tender offer price in the non-compliant tender offer. In addition, the non-complying offeror will be responsible for all of our expenses in connection with that offeror’s noncompliance.

These provisions could delay or hinder stockholder actions which are favored by the holders of a majority of our outstanding voting securities. These provisions may also discourage another person or entity from making a tender offer for our common stock, because such person or entity, even if it acquired a majority of our outstanding voting securities, would be able to take action as a stockholder (such as electing new directors or approving a merger) only at a duly 

 

Exhibit 4.2

called stockholders meeting, and not by written consent. The provisions of our charter requiring that the directors may be removed only for cause and only by the affirmative vote of at least three-quarters of the votes entitled to be cast generally in the election of directors will also prevent our stockholders from removing incumbent directors except for cause and upon a substantial affirmative vote. In addition, although the advance notice and information requirements in our bylaws do not give the Board of Directors any power to disapprove stockholder nominations for the election of directors or business proposals that are made in compliance with applicable advance notice procedures, 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.

Under the MGCL, a Maryland corporation generally cannot amend its charter unless the amendment is declared advisable by the corporation’s board of directors and approved by the affirmative vote of stockholders entitled to cast at least two-thirds of the votes entitled to be cast on the matter. A Maryland corporation may provide in its charter for approval of these matters by a lesser or greater percentage, but not less than a majority of all of the votes entitled to be cast on the matter. Subject to certain exceptions discussed below, our charter provides for approval of charter amendments by the affirmative vote of our stockholders entitled to cast a majority of the votes entitled to be cast on the matter. The Board of Directors, by vote of a majority of the members of the Board of Directors, has the exclusive power to adopt, alter, amend or repeal our bylaws. Our charter provides that any amendment to the following provisions of our charter, among others, shall require, in addition to any other vote required by applicable law or our charter, the affirmative vote of our stockholders entitled to cast at least three-quarters of the votes entitled to be cast thereon, with the holders of each class or series of our stock voting as a separate class, in addition to the affirmative vote of at least 75% of the members of the Board of Directors, unless three-quarters of the continuing directors approve the amendment, in which case such amendment must be approved as would otherwise be required by applicable law, our charter:

• the provisions regarding the classification of the Board of Directors;

 • the provisions governing the removal of directors;

 • the provisions limiting stockholder action by written consent;

 • the provisions regarding the number of directors on the Board of Directors;

 • the provisions specifying the vote required to approve extraordinary actions and amend our charter and the Board of Directors’ exclusive power to amend our bylaws;

• the limitations of directors’ and officers’ liability for money damages and the requirement that we indemnify its directors and officers as described above; and

 

 

Exhibit 4.2

 

 • the provisions imposing additional voting requirements on certain business combinations and other actions.

Advance Notice Provisions for Stockholder Nominations and Stockholder Proposals

Our bylaws provide that, with respect to an annual meeting of our stockholders, nominations of individuals for election as directors and the proposal of business to be considered by our stockholders may be made only (a) pursuant to our notice of the meeting, (b) by or at the direction of the Board of Directors or (c) by a stockholder who is a stockholder of record both at the time of giving the advance notice required by tour bylaws and at the time of the meeting, who is entitled to vote at the meeting in the election of each individual so nominated or on any such other business and who has complied with the advance notice procedures of our bylaws. With respect to special meetings of our stockholders, only the business specified in our notice of the meeting may be brought before the meeting. Nominations of individuals for election as directors at a special meeting at which directors are to be elected may be made only (a) by or at the direction of the Board of Directors or (b) provided that the special meeting has been called in accordance with our bylaws for the purpose of electing directors, by a stockholder who is a stockholder of record both at the time of giving the advance notice required by our bylaws 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 our bylaws.

The purpose of requiring our stockholders to give us advance notice of nominations and other business is to afford the 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 the Board of Directors, to inform our stockholders and make recommendations about such qualifications or business, as well as to provide a more orderly procedure for conducting meetings of our stockholders. Although our bylaws do not give the Board of Directors any power to disapprove stockholder nominations for the election of directors or proposals recommending certain action, the advance notice and information requirements may have the effect of precluding election contests 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 the Company and our stockholders.

No Appraisal Rights

For certain extraordinary transactions and charter amendments, the MGCL provides the right to dissenting stockholders to demand and receive the fair value of their shares, subject to certain procedures and requirements set forth in the statute. Those rights are commonly referred to as appraisal rights. As permitted by the MGCL, our charter provides that our stockholders will not be entitled to exercise appraisal rights unless the Board of Directors determines that appraisal rights apply, with respect to all or any classes or series of stock, to one or more transactions 

 

Exhibit 4.2

occurring after the date of such determination in connection with which our stockholders would otherwise be entitled to exercise appraisal rights.

Control Share Acquisitions

Certain provisions of the MGCL provide that a holder of control shares of a Maryland corporation acquired in a control share acquisition has no voting rights with respect to the control shares except to the extent approved by the affirmative vote of two-thirds of the votes entitled to be cast on the matter, which is referred to as the Control Share Acquisition Act. Shares owned by the acquiror, by officers or by employees who are directors of the corporation are excluded from shares entitled to vote on the matter. Control shares are voting shares of stock which, if aggregated with all other shares of stock owned by the acquirer or in respect of which the acquirer is able to exercise or direct the exercise of voting power (except solely by virtue of a 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.

The requisite stockholder approval must be obtained each time an acquirer crosses one of the thresholds of voting power set forth above. 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. A control share acquisition means the acquisition of issued and outstanding control shares, subject to certain exceptions.

A person who has made or proposes to make a control share acquisition may compel the board of directors of the corporation to call a special meeting of stockholders to be held within 50 days of demand to consider the voting rights of the shares. The right to compel the calling of a special meeting is subject to the satisfaction of certain conditions, including an undertaking to pay the expenses of the meeting. 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 at the meeting or if the acquiring person does not deliver an acquiring person statement as required by the statute, then the corporation may redeem for fair value any or all of the control shares, except those for which voting rights have previously been approved. The right of the corporation to redeem control shares is subject to certain conditions and limitations. Fair value is determined, without regard to the absence of voting rights for the control shares, as of the date of the last control share acquisition by the acquirer or if a meeting of stockholders is held at which the voting rights of the shares are considered and not approved, as of the date of such meeting. If voting rights for control shares are approved at a stockholder 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 appraisal rights may not be less than the highest price per share paid by the acquirer in the control share acquisition.

 

Exhibit 4.2

 

The Control Share Acquisition Act does not apply (a) to shares acquired in a merger, consolidation or share exchange if the corporation is a party to the transaction or (b) to acquisitions approved or exempted by the charter or bylaws of the corporation. Our bylaws contain a provision exempting from the Control Share Acquisition Act any and all acquisitions by any person of shares of stock. There can be no assurance that such provision will not be amended or eliminated at time in the future. However, the SEC staff has taken that position that, if a BDC fails to opt-out of the Control Share Acquisition Act, its actions are inconsistent with Section 18(i) of the 1940 Act and we will amend our bylaws to be subject to the Control Share Acquisition Act only if the Board of Directors determines that it would be in our best interests and if the SEC staff does not object to our determination that being subject to the Control Share Acquisition Act does not conflict with the 1940 Act.

Business Combinations

Under Maryland law, “business combinations” between a Maryland corporation and an interested stockholder or an affiliate of an interested stockholder are prohibited for five years after the most recent date on which the interested stockholder becomes an interested stockholder. These business combinations include a merger, consolidation, statutory share exchange or, in circumstances specified in the statute, an asset transfer or issuance or reclassification of equity securities. An interested stockholder is defined as:

•any person who beneficially owns 10% or more of the voting power of the corporation’s stock; or

 •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 of 10% or more of the voting power of the then outstanding voting stock of the corporation.

A person is not an interested stockholder under this statute if the corporation’s board of directors approves in advance the transaction by which he or she otherwise would have become an interested stockholder. However, in approving a transaction, the board 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 such business combination generally must be recommended by the corporation’s board of directors and approved by the affirmative vote of at least:

 •80% of the votes entitled to be cast by holders of outstanding shares of voting stock of the corporation; and

  •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 with whom or with whose affiliate the business combination is to be effected or held by an affiliate or associate of the interested stockholder.

 

Exhibit 4.2

These super-majority vote requirements do not apply if holders of the corporation’s common stock receive a minimum price, as defined under Maryland 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. The statute provides various exemptions from its provisions, including for business combinations that are exempted by the corporation’s board of directors before the time that the interested stockholder becomes an interested stockholder. The Board of Directors has adopted a resolution exempting from the requirements of the statute any business combination between the Company and any other person, provided that such business combination is first approved by the Board of Directors (including a majority of the directors who are not “interested persons” within the meaning of the 1940 Act). This resolution, however, may be altered or repealed in whole or in part at any time. If this resolution is repealed, or the Board of Directors does not otherwise approve a business combination, the statute may discourage others from trying to acquire control of the Company and increase the difficulty of consummating any offer.

Reports to Stockholders

We will furnish our stockholders with annual reports containing audited financial statements, quarterly reports, and such other periodic reports as we determine to be appropriate or as may be required by law. Upon the effectiveness of our Form 10 under the Exchange Act, we will be required to comply with all periodic reporting, proxy solicitation and other applicable requirements under the Exchange Act.

Conflict with the 1940 Act

Our bylaws provide that, if and to the extent that any provision of the MGCL, including the Control Share Acquisition Act (if we amend our bylaws to be subject to such act) and the Business Combination Act or any provision of our charter or bylaws conflicts with any provision of the 1940 Act, the applicable provision of the 1940 Act will control.

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