EXHIBIT
4.2


 


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


 


The
following summary describes our common stock, par value $0.001 per share (the “Common Stock”), of CBAK Energy Technology,
Inc. (the “Company,” “we,” “us,” and “our”), which are the only securities of
the Company registered pursuant to Section 12 of the Exchange Act.


 


DESCRIPTION
OF COMMON STOCK


 


The
following summary describes the material terms of our Common Stock. This summary does not purport to be complete and is qualified
in its entirety by reference to our Articles of Incorporation, Certificate of Change Pursuant to NRS 78.209, Certificate of Amendment
to Articles of Incorporation, Articles of Merger and By-laws incorporated by reference as Exhibits 3.1, 3.3, 3.4, 2.1 and 3.2,
respectively, to the Annual Report on Form 10-K of which this Exhibit 4.2 is a part. We encourage you to read the foregoing exhibits
and the applicable provisions of the Nevada Revised Statutes, Chapter 78, for a complete description of our Common Stock.


 


Authorized
Capital Stock


 


The
Company is authorized to issue up to 500,000,000 shares of Common Stock. The Common Stock may be issued from time to time for
such consideration as may be fixed by the Board of Directors, provided that the consideration fixed is not less than par value.


 


Voting
Rights


 


Each
outstanding share of Common Stock entitles the holder thereof to one vote per share on all matters coming before the stockholders
for a vote. Our articles of incorporation do not permit cumulative voting for the election of directors. Likewise, our articles
of incorporation do not vary the size of the vote necessary for the stockholders to act on various matters from the size of the
vote required by Nevada law, which means, unless a different vote is required by express provisions of Nevada law, an action by
the stockholders on a matter other than the election of directors shall be approved if the number of votes cast in favor of the
action exceeds the number of votes cast in opposition to the action. The directors of a Nevada corporation are elected at the
annual meeting of the stockholders by a plurality of the votes cast at the election.


 


Dividends


 


The
holders of shares of our Common Stock are entitled to dividends out of funds legally available when and as declared by our board
of directors. Our board of directors has never declared a dividend or otherwise authorized any cash or other distribution with
respect to the shares of our Common Stock and does not anticipate declaring a dividend in the foreseeable future. Should we decide
in the future to pay dividends, as a holding company, our ability to do so and meet other obligations depends upon the receipt
of dividends or other payments from our operating subsidiaries and other holdings and investments. In addition, our operating
subsidiaries, from time to time, may be subject to restrictions on their ability to make distributions to us, including as a result
of restrictive covenants in loan agreements, restrictions on the conversion of local currency into dollars or other hard currency
and other regulatory restrictions.


 


Liquidation


 


In
the event of our liquidation, dissolution or winding up, holders of our Common Stock are entitled to receive, ratably, the net
assets available to stockholders after payment of all creditors.


 


Other
Rights and Preferences


 


Our
Common Stock has no preemptive or subscription rights, and no redemption, sinking fund, or conversion provisions.


 






     


     


    

 


 Fully
Paid and Nonassessable


 


All
of the issued and outstanding shares of our Common Stock are duly authorized, validly issued, fully paid and non-assessable. To
the extent that additional shares of our Common Stock are issued, the relative interests of existing stockholders will be diluted.


 


Anti-takeover
Effects of Our Articles of Incorporation and Bylaws


 


Our
articles of incorporation and bylaws contain certain provisions that may have the effect of entrenching our existing board members,
delaying, deferring or preventing a future takeover or change in control of the company unless such takeover or change in control
is approved by the board of directors. These provisions include:


 


	 	●	Special Meetings
    of Stockholders — Our articles of incorporation provide that special meetings of the stockholders can only
    be called by our president or any other executive officer, or the board of directors, or any member thereof, the record holder
    or holders of at least 10% of all shares entitled to vote at the meeting, and our bylaws provide that a special meeting will
    be called by the president or secretary at the written request of our stockholders holding not less than 30% of all the shares
    issued, outstanding and entitled to vote.


 


	 	●	Advance Notice
    Procedures — At an annual meeting, our stockholders elect a board of directors and transact such other business
    as may properly be brought before the meeting. By contrast, at a special meeting, our stockholders may transact only the business
    for the purposes specified in the notice of the meeting unless all of our stockholders entitled to vote are present at the
    special meeting and consent.


 


	 	●	Contracts and
    Transactions with Interested Directors — We may enter into a contract or a transaction with an entity in which
    our directors or officers have a financial or other interest as long as such relationship has been disclosed to, or is known
    by, our board of directors, or is otherwise fair to the Company at the time it is authorized or approved.


 


	 	●	Amendment of
    Bylaws — Our Bylaws may be amended by our board of directors alone.


 


	 	●	Authorized but
    Unissued Shares — Our board of directors may cause us to issue our authorized but unissued shares of Common
    Stock in the future without stockholders’ approval. These additional shares may be utilized for a variety of corporate
    purposes, including future public offerings to raise additional capital, corporate acquisitions and employee benefit plans.
    The existence of authorized but unissued shares of Common Stock could render more difficult or discourage an attempt to obtain
    control of a majority of our Common Stock by means of a proxy contest, tender offer, merger or otherwise.


 


Anti-Takeover
Effects of Nevada Law


 


Nevada
Business Combination Statute


 


We
are subject to the “business combination” provisions of Sections 78.411 to 78.444 of the Nevada Revised Statutes.
In general, such provisions prohibit a Nevada corporation with at least 200 stockholders from engaging in various “combination”
transactions with any interested stockholder for a period of two years after the date of the transaction in which the person became
an interested stockholder, unless the transaction is approved by the board of directors prior to the date the interested stockholder
obtained such status or the combination is approved by the board of directors and thereafter is approved at a meeting of stockholders
by the affirmative vote of stockholders representing at least 60% of the outstanding voting power held by disinterested stockholders,
and extends beyond the expiration of the two-year period, unless (a) the combination was approved by the board of directors prior
to the person becoming an interested stockholder; (b) the transaction by which the person first became an interested stockholder
was approved by the board of directors before the person became an interested stockholder; (c) the combination is later approved
by a majority of the voting power held by disinterested stockholders; or (d) if the consideration to be paid by the interested
stockholder is at least equal to the highest of: (i) the highest price per share paid by the interested stockholder within the
two years immediately preceding the date of the announcement of the combination or in the transaction in which it became an interested
stockholder, whichever is higher, or (ii) the market value per share of common stock on the date of announcement of the combination
and the date the interested stockholder acquired the shares, whichever is higher.


 






    2


     


    

 


A
“combination” is generally defined to include mergers or consolidations or any sale, lease, exchange, mortgage, pledge,
transfer, or other disposition, in one transaction or a series of transactions, with an “interested stockholder” or
any affiliate or associate of an interested stockholder having: (a) an aggregate market value equal to more than 5% of the aggregate
market value of the assets of the corporation, (b) an aggregate market value equal to more than 5% of the aggregate market value
of all outstanding voting shares of the corporation, and (c) more than 10% of the earning power or net income of the corporation.


  


An
“interested stockholder” is generally defined to mean a beneficial owner of at least 10% of the outstanding voting
power or an affiliate or associate of the corporation that has been a 10% beneficial owner within the preceding 2 years. The statutes
could prohibit or delay mergers or other takeover or change in control attempts and, accordingly, may discourage attempts to acquire
our company even though such a transaction may offer our stockholders the opportunity to sell their stock at a price above the
prevailing market price.


 


Nevada
Acquisition of Controlling Interest Statute


 


Nevada’s
Acquisition of Controlling Interest Statute (NRS Sections 78.378-78.3793) applies only to Nevada corporations with at least 200
stockholders, including at least 100 stockholders of record who are Nevada residents, which conduct business directly or indirectly
in Nevada and whose articles of incorporation or bylaws in effect 10 days following the acquisition of a controlling interest
by an acquiror do not prohibit its application. As of the date of this prospectus, we do not believe we have 100 stockholders
of record who are residents of Nevada, although there can be no assurance that in the future the acquisition of controlling interest
statutes will not apply to us.


 


Nevada’s
Acquisition of Controlling Interest Statute, prohibits an acquiror, under certain circumstances, from voting shares of a target
corporation’s stock after crossing certain threshold ownership percentages, unless the acquiror obtains the approval of
the target corporation’s stockholders. The statute specifies three thresholds that constitute a controlling interest: (a)
at least one-fifth but less than one-third; (b) at least one-third but less than a majority; and (c) a majority or more, of the
outstanding voting power. Once an acquiror crosses one of these thresholds, shares which it acquired in the transaction exceeding
the threshold (or within ninety days preceding the date thereof) become “control shares” which could be deprived of
the right to vote until a majority of the disinterested stockholders restore that right.


 


A
special stockholders meeting may be called at the request of the acquiror to consider the voting rights of the acquiror’s
shares. If the acquiror requests a special meeting and gives an undertaking to pay the expenses of said meeting, then the meeting
must take place no earlier than 30 days (unless the acquiror requests that the meeting be held sooner) and no more than 50 days
(unless the acquiror agrees to a later date) after the delivery by the acquiror to the corporation of an information statement
which sets forth the range of voting power that the acquiror has acquired or proposes to acquire and certain other information
concerning the acquiror and the proposed control share acquisition.


 


If
no such request for a stockholders meeting is made, consideration of the voting rights of the acquiror’s shares must be
taken at the next special or annual stockholders meeting. If the stockholders fail to restore voting rights to the acquiror, or
if the acquiror fails to timely deliver an information statement to the corporation, then the corporation may, if so provided
in its articles of incorporation or bylaws, call certain of the acquiror’s shares for redemption at the average price paid
for the control shares by the acquiror.


 


In
the event the stockholders restore full voting rights to a holder of control shares that owns a majority of the voting stock,
then all other stockholders who do not vote in favor of restoring voting rights to the control shares may demand payment for the
“fair value” of their shares as determined by a court in dissenters rights proceeding pursuant to Chapter 92A of the
Nevada Revised Statutes.


 


Listing


 


Our
Common Stock is listed on Nasdaq Capital Market under the symbol “CBAT.”


 


Transfer
Agent and Registrar


 


Our
transfer agent and registrar is Securities Transfer Corporation, 2901 N Dallas Parkway, Suite 380, Plano, Texas 75093.


 


 


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