Exhibit 4.2


DESCRIPTION OF COMMON STOCK


The following
summary describes the material terms of the common stock, par value $0.001 per share, of Red Cat Holdings, Inc. (the “Company”).
The description of common stock is qualified by reference to our amended and restated certificate of incorporation and our amended
bylaws, which are incorporated by reference as exhibits to the Annual Report on Form 10-K of which this exhibit is a part.


General


Our amended and
restated certificate of incorporation authorizes us to issue up to 500,000,000 shares of common stock. In addition, under our amended
and restated certificate of incorporation, our board of directors has the authority, without further action by stockholders, to
designate up to 10,000,000 shares of preferred stock, par value $0.001 per share, in one or more series and to fix the rights,
preferences, privileges, qualifications and restrictions granted to or imposed upon the preferred stock, including dividend rights,
conversion rights, voting rights, rights and terms of redemption, liquidation preference and sinking fund terms, any or all of
which may be greater than the rights of our common stock. The issuance of preferred stock could adversely affect the voting power
of holders of common stock and reduce the likelihood that common stockholders will receive dividend payments and payments upon
liquidation.  The issuance could also have the effect of decreasing the market price of the common stock. The issuance
of preferred stock also could have the effect of delaying, deterring or prevent a change in control of us.


Voting 


Our common stock
is entitled to one vote for each share held of record on all matters submitted to a vote of the stockholders, including the election
of directors, and does not have cumulative voting rights.


Dividends 


Subject to preferences
that may be applicable to any then outstanding preferred stock, the holders of common stock are entitled to receive dividends,
if any, as may be declared from time to time by our board of directors out of legally available funds.


Liquidation 


In the event of
our liquidation, dissolution or winding up, holders of our common stock will be entitled to share ratably in the net assets legally
available for distribution to stockholders after the payment of all of our debts and other liabilities, subject to the satisfaction
of any liquidation preference granted to the holders of any outstanding shares of preferred stock.


Rights and Preferences 


Holders of our
common stock have no preemptive, conversion or subscription rights, and there are no redemption or sinking fund provisions applicable
to our common stock. The rights, preferences and privileges of the holders of our common stock are subject to, and may be adversely
affected by, the rights of the holders of shares of any series of our preferred stock that we may designate and issue in the future.


 


 


Anti-Takeover Effects of Provisions of Our Amended and Restated
Certificate of Incorporation, Our Bylaws and Nevada Law 


Nevada Anti-Takeover Law



 


The Nevada Revised Statutes (“NRS”)
contain several provisions which may make a hostile take-over or change of control of our Company more difficult to accomplish.
They include the following:


 


Under Nevada law, any one or all of the directors
of a corporation may be removed by the holders of not less than two-thirds of the voting power of a corporation’s issued
and outstanding stock. All vacancies on the board of directors of a Nevada corporation may be filled by a majority of the remaining
directors, though less than a quorum, unless the articles of incorporation provide otherwise. In addition, unless otherwise provided
in the articles of incorporation, the board may fill the vacancies for the entire remainder of the term of office of the resigning
director or directors. Our Articles of Incorporation do not provide otherwise.


 


In addition, Nevada law provides that unless
otherwise provided in a corporation’s articles of incorporation or bylaws, shareholders do not have the right to call special
meetings. Our articles of incorporation and our bylaws do not give shareholders this right. In accordance with Nevada law, we also
require advance notice of any shareholder proposals.


 


Nevada law provides that, unless otherwise
prohibited by any bylaws adopted by the shareholders, the board of directors may amend any bylaw, including any bylaw adopted by
the shareholders. Pursuant to Nevada law, our articles of incorporation grant the authority to adopt, amend or repeal bylaws exclusively
to our directors.


 


Nevada's “combinations with interested
stockholders” statutes prohibit certain business “combinations” between certain Nevada corporations and any person
deemed to be an “interested stockholder” for two years after the such person first becomes an “interested stockholder”
unless (i) the corporation's board of directors approves the combination (or the transaction by which such person becomes an “interested
stockholder”) in advance, or (ii) the combination is approved by the board of directors and sixty percent of the corporation's
voting power not beneficially owned by the interested stockholder, its affiliates and associates. Furthermore, in the absence of
prior approval, certain restrictions may apply even after such two-year period. For purposes of these statutes, an “interested
stockholder” is any person who is (x) the beneficial owner, directly or indirectly, of ten percent or more of the voting
power of the outstanding voting shares of the corporation, or (y) an affiliate or associate of the corporation and at any time
within the two previous years was the beneficial owner, directly or indirectly, of ten percent or more of the voting power of the
then outstanding shares of the corporation. Subject to certain timing requirements set forth in the statutes, a corporation may
elect not to be governed by these statutes. However, we have not included any such provision in our Certificate of Incorporation
or Bylaws, which means these provisions apply to us.


 


Nevada's “acquisition of controlling
interest” statutes contain provisions governing the acquisition of a controlling interest in certain Nevada corporations.
These “control share” laws provide generally that any person who acquires a “controlling interest” in certain
Nevada corporations may be denied certain voting rights, unless a majority of the disinterested stockholders of the corporation
elects to restore such voting rights. These statutes provide that a person acquires a “controlling interest” whenever
a person acquires shares of a subject corporation that, but for the application of these provisions of the NRS, would enable that
person to exercise (1) one-fifth or more, but less than one-third, (2) one-third or more, but less than a majority or (3) a majority
or more, of all of the voting power of the corporation in the election of directors. Once an acquirer crosses one of these thresholds,
shares which it acquired in the transaction taking it over the threshold and within the 90 days immediately preceding the date
when the acquiring person acquired or offered to acquire a controlling interest become “control shares” to which the
voting restrictions described above apply. Our Articles of Incorporation and Bylaws currently contain no provisions relating to
these statutes, and unless our Articles of Incorporation or Bylaws in effect on the tenth day after the acquisition of a controlling
interest were to provide otherwise, these laws would apply to us if we were to (i) have 200 or more stockholders of record (at
least 100 of which have addresses in the State of Nevada appearing on our stock ledger) and (ii) do business in the State of Nevada
directly or through an affiliated corporation. As of the date of this prospectus, we have less than 100 record stockholders with
Nevada addresses. However, if these laws were to apply to us, they might discourage companies or persons interested in acquiring
a significant interest in or control of the company, regardless of whether such acquisition may be in the interest of our stockholders.


 


Transfer Agent and Registrar  


The transfer agent and
registrar for our common stock is Equity Stock Transfer. The transfer agent’s address is 237 West 37th Street. Suite 602,
New York, NY 10018and its telephone number is (212) 575-5757.