Document:

Exhibit 10.9 

 

REGISTRATION RIGHTS AGREEMENT

 

THIS REGISTRATION RIGHTS
AGREEMENT (this “Agreement”) is entered into as of [ ], 2020, by and among East Stone Acquisition Corporation,
a British Virgin Islands company (the “Company”), the undersigned parties listed under Investors on the
signature page hereto (each, an “Investor” and collectively, the “Investors”),
and any other holder of Registrable Securities (as defined below) which becomes a party to this Agreement pursuant to Section 6.2.

 

WHEREAS, certain of
the Investors currently hold all of the outstanding Ordinary Shares of the Company issued prior to the consummation of the Company’s
initial public offering (the “Initial Shares”);

 

WHEREAS, certain of the Investors
are privately purchasing 323,750 Units simultaneously with the consummation of the Company’s initial public offering (the
“Initial Private Units”), and such Investors will purchase up to an aggregate of 26,250
additional Units (together with the Initial Private Units, the “Private Units”) in the event the underwriters
of the Company’s initial public offering exercise the over-allotment option in full or in part; and

 

WHEREAS, the Investors
and the Company desire to enter into this Agreement to provide the Investors with certain rights relating to the registration of
certain securities of the Company.

 

NOW, THEREFORE, in
consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 

 

1. DEFINITIONS.
The following capitalized terms used herein have the following meanings:

 

“AAA”
is defined in Section 6.11.

 

“Agreement”
means this Agreement, as amended, restated, supplemented, or otherwise modified from time to time.

 

“Business
Combination” means an acquisition, share exchange, share reconstruction and amalgamation, contractual control arrangement
or other similar business combination with the Company and one or more businesses or entities.

 

“Commission”
means the Securities and Exchange Commission, or any other Federal agency then administering the Securities Act or the Exchange
Act.

 

“Company”
is defined in the preamble to this Agreement. 

 

“Demand
Registration” is defined in Section 2.1.1.

 

“Demanding
Holder” is defined in Section 2.1.1.

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission promulgated
thereunder, all as the same shall be in effect at the time.

 

“Form S-3” is
defined in Section 2.2.4.

 

“Indemnified Party”
is defined in Section 4.3.

 

“Indemnifying Party”
is defined in Section 4.3.

 

     

     

    

 

“Initial Shares”
is defined in the preamble to this Agreement.

 

“Initial Private
Units” is defined in the preamble to this Agreement. 

 

“Investor” is
defined in the preamble to this Agreement.

 

“Maximum Number of Securities”
is defined in Section 2.1.4.

 

“Notices” is defined
in Section 6.3.

 

“Ordinary Shares”
means the Ordinary Shares of the Company, no par value.

 

“Piggy-Back Registration”
is defined in Section 2.2.1.

 

“Private Units”
is defined in the preamble to this Agreement.

 

“Register,”
“Registered” and “Registration” mean a registration effected by preparing and
filing a registration statement or similar document in compliance with the requirements of the Securities Act, and the applicable
rules and regulations promulgated thereunder, and such registration statement becoming effective.

 

“Registrable
Securities” means (i) all of the Initial Shares, (ii) all of the Private Units, (iii) all of the Working Capital
Units, (iii) all Ordinary Shares underlying the Private Units or issued or issuable upon the exercise or conversion of any
Warrants or Rights included in the Private Units or Working Capital Units, (iv) all Warrants and Rights included in the Private
Units or Working Capital Units and (v) any warrants, share capital or other securities of the Company issued as a dividend
or other distribution with respect to or in exchange for or in replacement of such Initial Shares, Private Units (and underlying
Ordinary Shares, Warrants and Rights) and Working Capital Units (and underlying Ordinary Shares, Warrants and Rights). As to any
particular Registrable Securities, such securities shall cease to be Registrable Securities when: (a) a Registration Statement
with respect to the sale of such securities shall have become effective under the Securities Act and such securities shall have
been sold, transferred, disposed of or exchanged in accordance with such Registration Statement; (b) such securities shall have
been otherwise transferred, new certificates for them not bearing a legend restricting further transfer shall have been delivered
by the Company and subsequent public distribution of them shall not require registration under the Securities Act; (c) such securities
shall have ceased to be outstanding, or (d) the Registrable Securities are freely saleable under Rule 144 without volume or other
restrictions or limitations. 

 

“Registration
Statement” means a registration statement filed by the Company with the Commission in compliance with the Securities
Act and the rules and regulations promulgated thereunder for a public offering and sale of equity securities, or securities or
other obligations exercisable or exchangeable for, or convertible into, equity securities (other than a registration statement
on Form S-4 or Form S-8, or their successors, or any registration statement covering only securities proposed to be issued in exchange
for securities or assets of another entity).

 

“Rights” means
the rights of the Company underlying the Units, each entitling the holder thereof to receive one-tenth of one ordinary share on
the consummation of an initial Business Combination.

 

“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations of the Commission promulgated thereunder,
all as the same shall be in effect at the time.

 

“Sponsor” means
Double Ventures Holdings Limited, a British Virgin Islands company.

 

“Investor Indemnified Party”
is defined in Section 4.1.

 

“Underwriter”
means a securities dealer who purchases any Registrable Securities as principal in an underwritten offering and not as part of
such dealer’s market-making activities.

 

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“Units”
means the units of the Company, each comprised of one ordinary share, one Right and one Warrant.

 

“Warrants” means
the warrants of the Company underlying the Units, each to purchase one half of one Ordinary Share.

 

“Working
Capital Units” means any Units held by the Sponsor, officers or directors of the Company or their affiliates which
may be issued in payment of working capital loans made to the Company.

 

2. REGISTRATION
RIGHTS.

 

2.1 Demand Registration.

 

2.1.1 Request
for Registration. At any time and from time to time on or after the date that the Company consummates a Business Combination,
the holders of a majority-in-interest of such Private Units (or underlying Ordinary Shares), Working Capital Units (or underlying
Ordinary Shares) or other Registrable Securities, as the case may be, held by the Investors, officers or directors of the Company
or their affiliates, or the transferees of the Investors, may make a written demand for registration under the Securities Act of
all or part of their Private Units (or underlying Ordinary Shares), Working Capital Units (or underlying Ordinary Shares) or other
Registrable Securities, as the case may be (a “Demand Registration”). Any demand for a Demand Registration
shall specify the number of Registrable Securities proposed to be sold and the intended method(s) of distribution thereof. The
Company will notify, in writing, all holders of Registrable Securities of the demand within ten (10) days of the Company’s
receipt of such demand, and each holder of Registrable Securities who wishes to include all or a portion of his, her or its Registrable
Securities in the Demand Registration (each such holder including Registrable Securities in such registration, including the holder(s)
making the initial demand, a “Demanding Holder”) shall so notify the Company, in writing, within fifteen
(15) days after the receipt by the holder of the notice from the Company. Upon any such request, the Demanding Holders shall be
entitled to have their Registrable Securities included in the Demand Registration, subject to Sections 2.1.4 and 3.5 and the provisos
set forth in Section 3.1.1. The Company shall not be obligated to effect more than an aggregate of three (3) Demand Registrations
under this Section 2.1.1 in respect of all Registrable Securities. 

 

2.1.2 Effective
Registration. A registration will not count as a Demand Registration unless and until the Registration Statement filed with
the Commission with respect to such Demand Registration has been declared effective by the Commission and the Company has complied
with all of its obligations under this Agreement with respect thereto; provided, however, that if, after such Registration Statement
has been declared effective, the offering of Registrable Securities pursuant to a Demand Registration is interfered with by any
stop order or injunction of the Commission or any other governmental agency or court, the Registration Statement with respect to
such Demand Registration will be deemed not to have been declared effective, unless and until, (i) such stop order or injunction
is removed, rescinded or otherwise terminated, and (ii) a majority-in-interest of the Demanding Holders thereafter elect to continue
the offering; provided, further, that the Company shall not be obligated to file another Registration Statement until a Registration
Statement that has been filed is counted as a Demand Registration or is terminated, which termination may be effected, following
a stop order or injunction, by notice to the Company from at least a majority-in-interest of the Demanding Holders.

 

2.1.3 Underwritten
Offering. If a majority-in-interest of the Demanding Holders so elect and such holders so advise the Company as part of their
written demand for a Demand Registration, the offering of such Registrable Securities pursuant to such Demand Registration shall
be in the form of an underwritten public offering. In such event, the right of any holder to include its Registrable Securities
in such registration shall be conditioned upon such holder’s participation in such underwritten offering and the inclusion
of such holder’s Registrable Securities in such underwritten offering to the extent provided herein. All Demanding Holders
proposing to distribute their Registrable Securities through such underwritten offering shall enter into an underwriting agreement
in customary form with the Underwriter or Underwriters selected for such underwriting by a majority-in-interest of the holders
initiating the Demand Registration. 

 

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2.1.4 Reduction
of Offering. If the managing Underwriter or Underwriters for a Demand Registration that is to be an underwritten public offering
advises the Company and the Demanding Holders in writing that the dollar amount or number of Registrable Securities that the Demanding
Holders desire to sell, taken together with all other Ordinary Shares or other equity securities that the Company desires to sell
and the Ordinary Shares, if any, as to which registration has been requested pursuant to written contractual piggy-back registration
rights held by other shareholders of the Company who desire to sell, exceeds the maximum dollar amount or maximum number of securities
that can be sold in such offering without adversely affecting the proposed offering price, the timing, the distribution method,
or the probability of success of such offering (such maximum dollar amount or maximum number of securities, as applicable, the
“Maximum Number of Securities”), then the Company shall include in such registration: (i) first, the
Registrable Securities as to which Demand Registration has been requested by the Demanding Holders (pro rata in accordance with
the number of Registrable Securities that each such holder has requested be included in such registration, regardless of the number
of Registrable Securities held by each such holder (such proportion is referred to herein as “Pro Rata”))
that can be sold without exceeding the Maximum Number of Securities; (ii) second, to the extent that the Maximum Number of Securities
has not been reached under the foregoing clause (i), the Ordinary Shares or other equity securities that the Company desires to
sell that can be sold without exceeding the Maximum Number of Securities; (iii) third, to the extent that the Maximum Number of
Securities has not been reached under the foregoing clauses (i) and (ii), the other securities registrable pursuant to the terms
of the Unit Purchase Option issued to the representative of the underwriters of the Company’s initial public offering, or
its designees, in connection with the Company’s initial public offering (the “Unit Purchase Option”
and such registrable securities, the “Option Securities”) as to which “piggy-back” registration
has been requested by the holders thereof, Pro Rata, that can be sold without exceeding the Maximum Number of Securities; and (iv)
fourth, to the extent that the Maximum Number of Securities have not been reached under the foregoing clauses (i) and (ii), the
Ordinary Shares or other equity securities for the account of other persons that the Company is obligated to register pursuant
to written contractual arrangements with such persons and that can be sold without exceeding the Maximum Number of Securities. 

 

2.1.5 Withdrawal.
If a majority-in-interest of the Demanding Holders disapprove of the terms of any underwritten offering or are not entitled to
include all of their Registrable Securities in any offering, such majority-in-interest of the Demanding Holders may elect to withdraw
from such offering by giving written notice to the Company and the Underwriter or Underwriters of their request to withdraw prior
to the effectiveness of the Registration Statement filed with the Commission with respect to such Demand Registration. If the majority-in-interest
of the Demanding Holders withdraws from a proposed offering relating to a Demand Registration, then such registration shall not
count as a Demand Registration provided for in Section 2.1.  Notwithstanding any such withdrawal, the Company shall pay all
expenses incurred by the holders of Registrable Securities in connection with such Demand Registration as provided in Section 3.3. 

 

2.2 Piggy-Back Registration.

 

2.2.1 Piggy-Back
Rights. If at any time on or after the date the Company consummates a Business Combination the Company proposes to file a Registration
Statement under the Securities Act with respect to an offering of equity securities, or securities or other obligations exercisable
or exchangeable for, or convertible into, equity securities, by the Company for its own account or for shareholders of the Company
for their account (or by the Company and by shareholders of the Company including, without limitation, pursuant to Section 2.1),
other than a Registration Statement (i) filed in connection with any employee share option or other benefit plan, (ii) for an exchange
offer or offering of securities solely to the Company’s existing shareholders, (iii) for an offering of debt that is convertible
into equity securities of the Company or (iv) for a dividend reinvestment plan, then the Company shall (x) give written notice
of such proposed filing to the holders of Registrable Securities as soon as practicable but in no event less than ten (10) days
before the anticipated filing date of such Registration Statement, which notice shall describe the amount and type of securities
to be included in such offering, the intended method(s) of distribution, and the name of the proposed managing Underwriter or Underwriters,
if any, of the offering, and (y) offer to the holders of Registrable Securities in such notice the opportunity to register the
sale of such number of Registrable Securities as such holders may request in writing within five (5) days following receipt of
such notice (a “Piggy-Back Registration”). The Company shall cause such Registrable Securities to be
included in such registration and shall use its best efforts to cause the managing Underwriter or Underwriters of a proposed underwritten
offering to permit the Registrable Securities requested by holders pursuant to this Section 2.2.1 to be included in a Piggy-Back
Registration on the same terms and conditions as any similar securities of the Company included in such registration and to permit
the sale or other disposition of such Registrable Securities in accordance with the intended method(s) of distribution thereof.
All holders of Registrable Securities proposing to distribute their securities through a Piggy-Back Registration that involves
an Underwriter or Underwriters shall enter into an underwriting agreement in customary form with the Underwriter or Underwriters
selected for such Piggy-Back Registration. 

 

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2.2.2 Reduction
of Offering. If the managing Underwriter or Underwriters for a Piggy-Back Registration that is to be an underwritten offering
advises the Company and the holders of Registrable Securities participating in such Piggy-Back registration in writing that the
dollar amount or number of Ordinary Shares that the Company desires to sell, taken together with Ordinary Shares, if any, as to
which registration has been demanded pursuant to written contractual arrangements with persons other than the holders of Registrable
Securities hereunder, the Registrable Securities as to which registration has been requested under this Section 2.2, and the Ordinary
Shares, if any, as to which registration has been requested pursuant to the written contractual piggy-back registration rights
of other shareholders of the Company, exceeds the Maximum Number of Securities, then the Company shall include in any such registration: 

 

a) If
the registration is undertaken for the Company’s account: (A) first, the Ordinary Shares or other equity securities that
the Company desires to sell that can be sold without exceeding the Maximum Number of Securities; (B) second, to the extent that
the Maximum Number of Securities has not been reached under the foregoing clause (A), the Ordinary Shares or other equity securities,
if any, comprised of Registrable Securities, as to which registration has been requested pursuant to the applicable written contractual
piggy-back registration rights of such security holders, Pro Rata, that can be sold without exceeding the Maximum Number of Securities;
and (C) third, to the extent that the Maximum Number of Securities has not been reached under the foregoing clauses (A) and (B),
the Ordinary Shares or other equity securities for the account of other persons that the Company is obligated to register pursuant
to written contractual piggy-back registration rights with such persons and that can be sold without exceeding the Maximum Number
of Securities;

 

b) If
the registration is a “demand” registration undertaken at the demand of holders of Option Securities, (A) first, the
Ordinary Shares or other securities for the account of the demanding persons, Pro Rata, that can be sold without exceeding the
Maximum Number of Securities; (B) second, to the extent that the Maximum Number of Securities has not been reached under the foregoing
clause (A), the Ordinary Shares or other securities that the Company desires to sell that can be sold without exceeding the Maximum
Number of Securities; (C) third, to the extent that the Maximum Number of Securities has not been reached under the foregoing clauses
(A) and (B), the shares of Registrable Securities, Pro Rata, as to which registration has been requested pursuant to the terms
hereof, that can be sold without exceeding the Maximum Number of Securities; and (D) fourth, to the extent that the Maximum Number
of Securities has not been reached under the foregoing clauses (A), (B) and (C), the Ordinary Shares or other securities for the
account of other persons that the Company is obligated to register pursuant to written contractual arrangements with such persons,
that can be sold without exceeding the Maximum Number of Securities; and

 

c) If
the registration is a “demand” registration undertaken at the demand of persons other than either the holders of Registrable
Securities or of Option Securities, (A) first, the Ordinary Shares or other equity securities for the account of the demanding
persons that can be sold without exceeding the Maximum Number of Securities; (B) second, to the extent that the Maximum Number
of Securities has not been reached under the foregoing clause (A), the Ordinary Shares or other equity securities that the Company
desires to sell that can be sold without exceeding the Maximum Number of Securities; (C) third, to the extent that the Maximum
Number of Securities has not been reached under the foregoing clauses (A) and (B), collectively the Ordinary Shares or other securities
comprised of Registrable Securities and Option Securities, Pro Rata, as to which registration has been requested pursuant to the
terms hereof and of the Unit Purchase Option, as applicable, that can be sold without exceeding the Maximum Number of Securities;
and (D) fourth, to the extent that the Maximum Number of Securities has not been reached under the foregoing clauses (A), (B) and
(C), the Ordinary Shares or other equity securities for the account of other persons that the Company is obligated to register
pursuant to written contractual arrangements with such persons, that can be sold without exceeding the Maximum Number of Securities. 

 

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2.2.3 Withdrawal.
Any holder of Registrable Securities may elect to withdraw such holder’s request for inclusion of Registrable Securities
in any Piggy-Back Registration by giving written notice to the Company of such request to withdraw prior to the effectiveness of
the Registration Statement. The Company (whether on its own determination or as the result of a withdrawal by persons making a
demand pursuant to written contractual obligations) may withdraw a Registration Statement at any time prior to the effectiveness
of such Registration Statement. Notwithstanding any such withdrawal, the Company shall pay all expenses incurred by the holders
of Registrable Securities in connection with such Piggy-Back Registration as provided in Section 3.3. 

 

2.2.4 Registrations
on Form S-3. The holders of Registrable Securities may at any time and from time to time, request in writing that the Company
register the resale of any or all of such Registrable Securities on Form S-3 or any similar short-form registration which may be
available at such time (“Form S-3”); provided, however, that the Company shall not be obligated to effect
such request through an underwritten offering. Upon receipt of such written request, the Company will promptly give written notice
of the proposed registration to all other holders of Registrable Securities, and, as soon as practicable thereafter, effect the
registration of all or such portion of such holder’s or holders’ Registrable Securities as are specified in such request,
together with all or such portion of the Registrable Securities or other securities of the Company, if any, of any other holder
or holders joining in such request as are specified in a written request given within fifteen (15) days after receipt of such written
notice from the Company; provided, however, that the Company shall not be obligated to effect any such registration pursuant to
this Section 2.2.4: (i) if Form S-3 is not available for such offering; or (ii) if the holders of the Registrable Securities, together
with the holders of any other securities of the Company entitled to inclusion in such registration, propose to sell Registrable
Securities and such other securities (if any) at any aggregate price to the public of less than $500,000. Registrations effected
pursuant to this Section 2.2.4 shall not be counted as Demand Registrations effected pursuant to Section 2.1. 

 

2.3 Limitations
on Registration Rights. Notwithstanding anything herein to the contrary, I-Bankers Securities, Inc. (i) may not exercise its
rights under Sections 2.1 and 2.2 hereunder after five (5) and seven (7) years after the effective date of the registration statement
relating to the Company’s initial public offering, respectively, and (ii) may not exercise its rights under Section 2.1 more
than one time.

 

3. REGISTRATION PROCEDURES.

 

3.1 Filings;
Information. Whenever the Company is required to effect the registration of any Registrable Securities pursuant to Section
2, the Company shall use its best efforts to effect the registration and sale of such Registrable Securities in accordance with
the intended method(s) of distribution thereof as expeditiously as practicable, and in connection with any such request: 

 

3.1.1 Filing
Registration Statement. The Company shall use its best efforts to, as expeditiously as possible after receipt of a request
for a Demand Registration pursuant to Section 2.1, prepare and file with the Commission a Registration Statement on any form for
which the Company then qualifies or which counsel for the Company shall deem appropriate and which form shall be available for
the sale of all Registrable Securities to be registered thereunder in accordance with the intended method(s) of distribution thereof,
and shall use its best efforts to cause such Registration Statement to become effective and use its best efforts to keep it effective
for the period required by Section 3.1.3; provided, however, that the Company shall have the right to defer any Demand Registration
for up to thirty (30) days, and any Piggy-Back Registration for such period as may be applicable to deferment of any demand registration
to which such Piggy-Back Registration relates, in each case if the Company shall furnish to the holders of Registrable Securities
included in such Registration Statement a certificate signed by the President or Chairman of the Company stating that, in the good
faith judgment of the Board of Directors of the Company, it would be materially detrimental to the Company and its shareholders
for such Registration Statement to be effected at such time; provided further, however, that the Company shall not have the right
to exercise the right set forth in the immediately preceding proviso more than once in any 365-day period in respect of a Demand
Registration hereunder. 

 

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3.1.2 Copies.
The Company shall, prior to filing a Registration Statement or prospectus, or any amendment or supplement thereto, furnish without
charge to the holders of Registrable Securities included in such registration, and such holders’ legal counsel, copies of
such Registration Statement as proposed to be filed, each amendment and supplement to such Registration Statement (in each case
including all exhibits thereto and documents incorporated by reference therein), the prospectus included in such Registration Statement
(including each preliminary prospectus), and such other documents as the holders of Registrable Securities included in such registration
or legal counsel for any such holders may request in order to facilitate the disposition of the Registrable Securities owned by
such holders. 

 

3.1.3 Amendments
and Supplements. The Company shall prepare and file with the Commission such amendments, including post-effective amendments,
and supplements to such Registration Statement and the prospectus used in connection therewith as may be reasonably requested by
the majority-in-interest of the holders with Registrable Securities registered on such Registration Statement, and as necessary
to keep such Registration Statement effective and in compliance with the provisions of the Securities Act until all Registrable
Securities and other securities covered by such Registration Statement have been disposed of in accordance with the intended method(s)
of distribution set forth in such Registration Statement or such securities have been withdrawn or until such time as the Registrable
Securities cease to be Registrable Securities as defined by the Agreement. 

 

3.1.4 Notification.
After the filing of any Registration Statement pursuant to this Agreement, any prospectus related thereto or any amendment or supplement
to such Registration Statement or prospectus, the Company shall promptly, and in no event more than two (2) business days after
such filing, notify the holders of Registrable Securities included in such Registration Statement of such filing, and shall further
notify such holders promptly and confirm such advice in writing in all events within two (2) business days of the occurrence of
any of the following: (i) when such Registration Statement becomes effective; (ii) when any post-effective amendment to such Registration
Statement becomes effective; (iii) the issuance or threatened issuance by the Commission of any stop order (and the Company shall
take all actions required to prevent the entry of such stop order or to remove it if entered); (iv) any request by the Commission
for any amendment or supplement to such Registration Statement or any prospectus relating thereto or for additional information;
and (v) the occurrence of an event requiring the preparation of a supplement or amendment to such Registration Statement or
prospectus so that, after such amendment is filed or prospectus delivered to the purchasers of the securities covered by such Registration
Statement, such Registration Statement or prospectus will not contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in order to make the statements therein (in the case of the prospectus,
in the light of the circumstances under which they were made), not misleading, and the Company shall promptly make available to
the holders of Registrable Securities included in such Registration Statement any such supplement or amendment; except that before
filing with the Commission a Registration Statement or prospectus or any amendment or supplement thereto, including documents incorporated
by reference, the Company shall furnish to the holders of Registrable Securities included in such Registration Statement and to
the legal counsel for any such holders, copies of all such documents proposed to be filed sufficiently in advance of filing to
provide such holders and legal counsel with a reasonable opportunity to review such documents and comment thereon, and the Company
shall not file any Registration Statement or prospectus or amendment or supplement thereto, including documents incorporated by
reference, to which such holders or their legal counsel shall reasonably object. 

 

3.1.5 State Securities
Laws Compliance. The Company shall use its best efforts to (i) register or qualify the Registrable Securities covered by the
Registration Statement under such securities or “blue sky” laws of such jurisdictions in the United States as the holders
of Registrable Securities included in such Registration Statement (in light of their intended plan of distribution) may request
and (ii) take such action necessary to cause such Registrable Securities covered by the Registration Statement to be registered
with or approved by such other governmental authorities as may be necessary by virtue of the business and operations of the Company
and do any and all other acts and things that may be necessary or advisable to enable the holders of Registrable Securities included
in such Registration Statement to consummate the disposition of such Registrable Securities in such jurisdictions; provided, however,
that the Company shall not be required to qualify generally to do business in any jurisdiction where it would not otherwise be
required to qualify but for this paragraph or subject itself to taxation in any such jurisdiction. 

 

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3.1.6 Agreements
for Disposition. The Company shall enter into customary agreements (including, if applicable, an underwriting agreement in
customary form) and take such other actions as are reasonably required in order to expedite or facilitate the disposition of such
Registrable Securities. The representations, warranties and covenants of the Company in any underwriting agreement which are made
to or for the benefit of any Underwriters, to the extent applicable, shall also be made to and for the benefit of the holders of
Registrable Securities included in such registration statement. No holder of Registrable Securities included in such registration
statement shall be required to make any representations or warranties in the underwriting agreement except, if applicable, with
respect to such holder’s organization, good standing, authority, title to Registrable Securities, lack of conflict of such
sale with such holder’s material agreements and organizational documents, and with respect to written information relating
to such holder that such holder has furnished in writing expressly for inclusion in such Registration Statement.

 

3.1.7 Cooperation.
The principal executive officer of the Company, the principal financial officer of the Company, the principal accounting officer
of the Company and all other officers and members of the management of the Company shall cooperate fully in any offering of Registrable
Securities hereunder, which cooperation shall include, without limitation, the preparation of the Registration Statement with respect
to such offering and all other offering materials and related documents, and participation in meetings with Underwriters, attorneys,
accountants and potential investors. 

 

3.1.8 Records.
The Company shall make available for inspection by the holders of Registrable Securities included in such Registration Statement,
any Underwriter participating in any disposition pursuant to such Registration Statement and any attorney, accountant or other
professional retained by any holder of Registrable Securities included in such Registration Statement or any Underwriter, all financial
and other records, pertinent corporate documents and properties of the Company, as shall be necessary to enable them to exercise
their due diligence responsibility, and cause the Company’s officers, directors and employees to supply all information requested
by any of them in connection with such Registration Statement. 

 

3.1.9 Opinions
and Comfort Letters. In the case of any underwritten offering or if reasonably requested by any participant in any other offering
pursuant to a Registration Statement filed pursuant to this Agreement, the Company shall obtain opinions of counsel representing
the Company for the purposes of a registration pursuant to this Agreement, addressed to the holders participating in such registration,
the placement agent or sales agent, if any, and the Underwriters, if any, covering such legal matters with respect to such registration
in respect of which such opinion is being given as such holders, placement agent, sales agent, or Underwriter may reasonably request
and as are customarily included in such opinions and negative assurance letters, and reasonably satisfactory to a holders of a
majority-in-interest of the Registrable Securities included in such registration. In the case of any underwritten offering or if
reasonably requested by any participant in any other offering pursuant to a Registration Statement filed pursuant to this Agreement,
the Company shall obtain a “cold comfort” letters from the Company’s independent registered public accountants
in the event of an underwritten public offering pursuant to this Agreement, in customary form and covering such matters of the
type customarily covered by “cold comfort” letters as the managing Underwriter may reasonably request, and reasonably
satisfactory to a holders of a majority-in-interest of the Registrable Securities included in such registration. The Company shall
furnish to each holder of Registrable Securities included in any Registration Statement a signed counterpart, addressed to such
holder, of (i) any opinion of counsel to the Company delivered to any Underwriter and (ii) any comfort letter from the
Company’s independent public accountants delivered to any Underwriter.

 

3.1.10 Earnings
Statement. The Company shall comply with all applicable rules and regulations of the Commission and the Securities Act, and
make available to its shareholders, as soon as practicable, an earnings statement covering a period of twelve (12) months, which
earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder. 

 

3.1.11 Listing.
The Company shall use its best efforts to cause all Registrable Securities included in any registration to be listed on such exchanges
or otherwise designated for trading in the same manner as similar securities issued by the Company are then listed or designated
or, if no such similar securities are then listed or designated, in a manner satisfactory to the holders of a majority-in-interest
of the Registrable Securities included in such registration. 

 

3.1.12 Road
Show. If the registration involves the registration of Registrable Securities involving gross proceeds in excess of $25,000,000,
the Company shall use its reasonable efforts to make available senior executives of the Company to participate in customary “road
show” presentations that may be reasonably requested by the Underwriter in any underwritten offering. 

 

    8

     

    

 

3.2 Obligation
to Suspend Distribution. Upon receipt of any notice from the Company of the happening of any event of the kind described in
Section 3.1.4(iv) or (v), or, in the case of a resale registration on Form S-3 pursuant to Section 2.2.4 hereof, upon any suspension
by the Company, pursuant to a written insider trading compliance program adopted by the Company’s Board of Directors, of
the ability of all “insiders” covered by such program to transact in the Company’s securities because of the
existence of material non-public information, each holder of Registrable Securities included in any registration shall immediately
discontinue disposition of such Registrable Securities pursuant to the Registration Statement covering such Registrable Securities
until such holder receives the supplemented or amended prospectus contemplated by Section 3.1.4 or the restriction on the ability
of “insiders” to transact in the Company’s securities is removed, as applicable, and, if so directed by the Company,
each such holder will deliver to the Company all copies, other than permanent file copies then in such holder’s possession,
of the most recent prospectus covering such Registrable Securities at the time of receipt of such notice.

 

3.3 Registration
Expenses. The Company shall bear all costs and expenses incurred in connection with any Demand Registration pursuant to Section
2.1, any Piggy-Back Registration pursuant to Section 2.2, and any registration on Form S-3 effected pursuant to Section 2.2.4,
and all expenses incurred in performing or complying with its other obligations under this Agreement, whether or not the Registration
Statement becomes effective, including, without limitation: (i) all registration and filing fees; (ii) fees and expenses of compliance
with securities or “blue sky” laws (including fees and disbursements of counsel in connection with blue sky qualifications
of the Registrable Securities); (iii) printing, messenger, telephone and delivery expenses; (iv) the Company’s internal expenses
(including, without limitation, all salaries and expenses of its officers and employees); (v) the fees and expenses incurred in
connection with the listing of the Registrable Securities (including as required by Section 3.1.11); (vi) Financial Industry Regulatory
Authority fees; (vii) fees and disbursements of counsel for the Company and fees and expenses for independent certified public
accountants retained by the Company (including the expenses or costs associated with the delivery of any opinions or comfort letters
requested pursuant to Section 3.1.9); (viii) the fees and expenses of any special experts retained by the Company in connection
with such registration; and (ix) the fees and expenses of one legal counsel selected by the holders of a majority-in-interest of
the Registrable Securities included in such registration. The Company shall have no obligation to pay any underwriting discounts
or selling commissions attributable to the Registrable Securities being sold by the holders thereof, which underwriting discounts
or selling commissions shall be borne by such holders in proportion to the number of Registrable Securities included in such offering
for each such holder.

 

3.4 Information.
The holders of Registrable Securities shall provide such information as may reasonably be requested by the Company, or the managing
Underwriter, if any, in connection with the preparation of any Registration Statement, including amendments and supplements thereto,
in order to effect the registration of any Registrable Securities under the Securities Act pursuant to Section 2 and in connection
with the Company’s obligation to comply with Federal and applicable state securities laws. 

 

4. INDEMNIFICATION AND CONTRIBUTION.

 

4.1 Indemnification
by the Company. The Company agrees to indemnify and hold harmless each Investor and each other holder of Registrable Securities,
and each of their respective officers, employees, affiliates, directors, partners, members, attorneys and agents, and each person,
if any, who controls an Investor and each other holder of Registrable Securities (within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act) (each, an “Investor Indemnified Party”), from and against any
expenses, losses, judgments, claims, damages or liabilities, whether joint or several, arising out of or based upon any untrue
statement (or allegedly untrue statement) of a material fact contained in any Registration Statement under which the sale of such
Registrable Securities was registered under the Securities Act, any preliminary prospectus, final prospectus or summary prospectus
contained in the Registration Statement, or any amendment or supplement to such Registration Statement, or arising out of or based
upon any omission (or alleged omission) to state a material fact required to be stated therein or necessary to make the statements
therein not misleading, or any violation by the Company of the Securities Act or any rule or regulation promulgated thereunder
applicable to the Company and relating to action or inaction required of the Company in connection with any such registration;
and the Company shall promptly reimburse the Investor Indemnified Party for any legal and any other expenses reasonably incurred
by such Investor Indemnified Party in connection with investigating and defending any such expense, loss, judgment, claim, damage,
liability or action; provided, however, that the Company will not be liable in any such case to the extent that any such expense,
loss, claim, damage or liability arises out of or is based upon any untrue statement or allegedly untrue statement or omission
or alleged omission made in such Registration Statement, preliminary prospectus, final prospectus, or summary prospectus, or any
such amendment or supplement, in reliance upon and in conformity with information furnished to the Company, in writing, by such
selling holder expressly for use therein. The Company also shall indemnify any Underwriter of the Registrable Securities, their
officers, affiliates, directors, partners, members and agents and each person who controls such Underwriter on substantially the
same basis as that of the indemnification provided above in this Section 4.1.

 

    9

     

    

 

4.2 Indemnification
by Holders of Registrable Securities. Each selling holder of Registrable Securities will, in the event that any registration
is being effected under the Securities Act pursuant to this Agreement of any Registrable Securities held by such selling holder,
indemnify and hold harmless the Company, each of its directors and officers and each Underwriter (if any), and each other selling
holder and each other person, if any, who controls another selling holder or such Underwriter within the meaning of the Securities
Act, against any losses, claims, judgments, damages or liabilities, whether joint or several, insofar as such losses, claims, judgments,
damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or allegedly untrue
statement of a material fact contained in any Registration Statement under which the sale of such Registrable Securities was registered
under the Securities Act, any preliminary prospectus, final prospectus or summary prospectus contained in the Registration Statement,
or any amendment or supplement to the Registration Statement, or arise out of or are based upon any omission or the alleged omission
to state a material fact required to be stated therein or necessary to make the statement therein not misleading, but only if the
statement or omission was made in reliance upon and in conformity with information furnished in writing to the Company by such
selling holder expressly for use therein, and shall reimburse the Company, its directors and officers, and each other selling holder
or controlling person for any legal or other expenses reasonably incurred by any of them in connection with investigation or defending
any such loss, claim, damage, liability or action. Each selling holder’s indemnification obligations hereunder shall be several
and not joint and shall be limited to the amount of any net proceeds actually received by such selling holder in such offering
giving rise to such liability.

 

4.3 Conduct
of Indemnification Proceedings. Promptly after receipt by any person of any notice of any loss, claim, damage or liability
or any action in respect of which indemnity may be sought pursuant to Section 4.1 or 4.2, such person (the “Indemnified
Party”) shall, if a claim in respect thereof is to be made against any other person for indemnification hereunder, notify
such other person (the “Indemnifying Party”) in writing of the loss, claim, judgment, damage, liability
or action; provided, however, that the failure by the Indemnified Party to notify the Indemnifying Party shall not relieve the
Indemnifying Party from any liability which the Indemnifying Party may have to such Indemnified Party hereunder, except and solely
to the extent the Indemnifying Party is actually, materially prejudiced by such failure. If the Indemnified Party is seeking indemnification
with respect to any claim or action brought against the Indemnified Party, then the Indemnifying Party shall be entitled to participate
in such claim or action, and, to the extent that it wishes, jointly with all other Indemnifying Parties, to assume control of the
defense thereof with counsel satisfactory to the Indemnified Party. After notice from the Indemnifying Party to the Indemnified
Party of its election to assume control of the defense of such claim or action, the Indemnifying Party shall not be liable to the
Indemnified Party for any legal or other expenses subsequently incurred by the Indemnified Party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that in any action in which both the Indemnified Party
and the Indemnifying Party are named as defendants, the Indemnified Party shall have the right to employ separate counsel (but
no more than one such separate counsel) to represent the Indemnified Party and its controlling persons who may be subject to liability
arising out of any claim in respect of which indemnity may be sought by the Indemnified Party against the Indemnifying Party, with
the fees and expenses of such counsel to be paid by such Indemnifying Party if, based upon advice of counsel of such Indemnified
Party, representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests
between them. No Indemnifying Party shall, without the prior written consent of the Indemnified Party, consent to entry of judgment
or effect any settlement of any claim or pending or threatened proceeding in respect of which the Indemnified Party is or could
have been a party and indemnity could have been sought hereunder by such Indemnified Party, unless such judgment or settlement
includes an unconditional release of such Indemnified Party from all liability arising out of such claim or proceeding. 

 

    10

     

    

 

4.4 Contribution. 

 

4.4.1 If the indemnification
provided for in the foregoing Sections 4.1, 4.2 and 4.3 is unavailable or insufficient to any Indemnified Party in respect of any
loss, claim, damage, liability or action referred to herein, then each such Indemnifying Party, in lieu of indemnifying such Indemnified
Party, shall contribute to the amount paid or payable by such Indemnified Party as a result of such loss, claim, damage, liability
or action in such proportion as is appropriate to reflect the relative fault of the Indemnified Parties and the Indemnifying Parties
in connection with the actions or omissions which resulted in such loss, claim, damage, liability or action, as well as any other
relevant equitable considerations. The relative fault of any Indemnified Party and any Indemnifying Party shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by such Indemnified Party or such Indemnifying Party and the
parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

 

4.4.2 The parties
hereto agree that it would not be just and equitable if contribution pursuant to this Section 4.4 were determined by pro rata allocation
or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately
preceding Section 4.4.1. 

 

4.4.3 The amount
paid or payable by an Indemnified Party as a result of any loss, claim, damage, liability or action referred to in Section 4.4.1
shall be deemed to include, subject to the limitations set forth above, any legal or other expenses incurred by such Indemnified
Party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 4.4,
no holder of Registrable Securities shall be required to contribute any amount in excess of the dollar amount of the net proceeds
(after payment of any underwriting fees, discounts, commissions or taxes) actually received by such selling holder from the sale
of Registrable Securities which gave rise to such contribution obligation. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.

 

5. UNDERWRITING AND DISTRIBUTION.

 

5.1 Rule
144. The Company covenants that it shall file any reports required to be filed by it under the Securities Act and the Exchange
Act and shall take such further action as the holders of Registrable Securities may reasonably request, all to the extent required
from time to time to enable such holders to sell Registrable Securities without registration under the Securities Act within the
limitation of the exemptions provided by Rule 144 under the Securities Act, as such Rules may be amended from time to time, or
any similar rule or regulation hereafter adopted by the Commission. Upon the request of any holder of Registrable Securities, the
Company shall deliver to such Holder a written certification of a duly authorized officer as to (A) whether the Company has
filed (i) all reports and other materials required to be filed pursuant to Sections 13(a) or 15(d) of the Exchange Act, as
applicable, during the preceding 12 months (or for such shorter period that the Company was required to file such reports
and materials), other than Current Reports on Form 8-K and (ii) current “Form 10 information” (within the meaning
of Rule 144 under the Securities Act) with the Commission reflecting the Company’s status as an entity that is no longer
an issuer described in paragraph (i)(1)(i) of Rule 144 under the Securities Act and (B) the first date that the Company filed “Form
10 information” (within the meaning of Rule 144 under the Securities Act) with the Commission. 

 

6. MISCELLANEOUS. 

 

6.1 Other
Registration Rights. The Company represents and warrants that no person, other than the holders of the Registrable Securities,
has any right to require the Company to register any of the Company’s share capital for sale or to include the Company’s
share capital in any registration filed by the Company for the sale of share capital for its own account or for the account of
any other person. 

 

6.2 Assignment;
No Third Party Beneficiaries. This Agreement and the rights, duties and obligations of the Company hereunder may not be assigned
or delegated by the Company in whole or in part. This Agreement and the rights, duties and obligations of the holders of Registrable
Securities hereunder may be freely assigned or delegated by such holder of Registrable Securities in conjunction with and to the
extent of any transfer of Registrable Securities by any such holder. This Agreement and the provisions hereof shall be binding
upon and shall inure to the benefit of each of the parties, to the permitted assigns of the Investors or holder of Registrable
Securities or of any assignee of the Investors or holder of Registrable Securities. This Agreement is not intended to confer any
rights or benefits on any persons that are not party hereto other than as expressly set forth in Article 4 and this Section 6.2. 
Any additional holder of Registrable Securities may become party to this Agreement by executing and delivering a joinder to the
Company and the Investors in form and substance reasonably satisfactory to the Company.

 

    11

     

    

 

6.3 Notices.
All notices, demands, requests, consents, approvals or other communications (collectively, “Notices”)
required or permitted to be given hereunder or which are given with respect to this Agreement shall be in writing and shall be
personally served, delivered by reputable air courier service with charges prepaid, or transmitted by hand delivery, telegram,
telex or facsimile, addressed as set forth below, or to such other address as such party shall have specified most recently by
written notice. Notice shall be deemed given on the date of service or transmission if personally served or transmitted by telegram,
telex or facsimile; 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 a reputable air courier service with an order for next-day
delivery. 

 

To the Company:

 

East Stone Acquisition Corporation

25 Mall Road, Suite 330

Burlington, MA 01803

Attn: Xiaoma (Sherman) Lu, Chief Executive Officer

 

with a copy to:

 

Ellenoff Grossman & Schole LLP

1345 Avenue of the Americas

New York, NY 10105

Attn: Barry Grossman, Esq.

 

To the Investors, to the addresses set forth below the Investors’
names on Exhibit A hereto.

 

6.4 Severability.
This Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect
the validity or enforceability of this Agreement or of any other term or provision hereof. Furthermore, in lieu of any such invalid
or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Agreement a provision
as similar in terms to such invalid or unenforceable provision as may be possible that is valid and enforceable.

 

6.5 Counterparts.
This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, and all of which taken together
shall constitute one and the same instrument. 

 

6.6 Entire
Agreement. This Agreement (including all agreements entered into pursuant hereto and all certificates and instruments delivered
pursuant hereto and thereto) constitute the entire agreement of the parties with respect to the subject matter hereof and supersede
all prior and contemporaneous agreements, representations, understandings, negotiations and discussions between the parties, whether
oral or written. 

 

6.7 Modifications
and Amendments. No amendment, modification or termination of this Agreement shall be binding upon any party unless executed
in writing by such party. 

 

6.8 Titles
and Headings. Titles and headings of sections of this Agreement are for convenience only and shall not affect the construction
of any provision of this Agreement. 

 

6.9 Waivers
and Extensions. Any party to this Agreement may waive any right, breach or default which such party has the right to waive,
provided that such waiver will not be effective against the waiving party unless it is in writing, is signed by such party, and
specifically refers to this Agreement. Waivers may be made in advance or after the right waived has arisen or the breach or default
waived has occurred. Any waiver may be conditional. No waiver of any breach of any agreement or provision herein contained shall
be deemed a waiver of any preceding or succeeding breach thereof nor of any other agreement or provision herein contained. No waiver
or extension of time for performance of any obligations or acts shall be deemed a waiver or extension of the time for performance
of any other obligations or acts.

 

    12

     

    

 

6.10 Remedies
Cumulative. In the event that the Company fails to observe or perform any covenant or agreement to be observed or performed
under this Agreement, the Investors or any other holder of Registrable Securities may proceed to protect and enforce its rights
by suit in equity or action at law, whether for specific performance of any term contained in this Agreement or for an injunction
against the breach of any such term or in aid of the exercise of any power granted in this Agreement or to enforce any other legal
or equitable right, or to take any one or more of such actions, without being required to post a bond. None of the rights, powers
or remedies conferred under this Agreement shall be mutually exclusive, and each such right, power or remedy shall be cumulative
and in addition to any other right, power or remedy, whether conferred by this Agreement or now or hereafter available at law,
in equity, by statute or otherwise. 

 

6.11 Governing
Law. In connection with Section 5-1401 of the General Obligations Law of the State of New York, this Agreement shall be governed
by, and construed in accordance with, the laws of the State of New York without regard to principles of conflicts of law that would
result in the application of the substantive law of another jurisdiction. The parties hereto agree that any action, proceeding
or claim arising out of or relating in any way to this Agreement shall be resolved through final and biding arbitration in accordance
with the International Arbitration Rules of the American Arbitration Association (“AAA”). The arbitration shall
be brought before the AAA International Center for Dispute Resolution’s offices in New York City, New York, will be conducted
in English and will be decided by a panel of three arbitrators selected from the AAA Commercial Disputes Panel and that the arbitrator
panel’s decision shall be final and enforceable by any court having jurisdiction over the party from whom enforcement is
sought. The cost of such arbitrators and arbitration services, together with the prevailing party’s legal fees and expenses,
shall be borne by the non-prevailing party or as otherwise directed by the arbitrators. The Company hereby appoints, without power
of revocation, Ellenoff Grossman & Schole LLP, 1345 Avenue of the Americas, New York, NY 10105, Fax No.: (212) 370-7889, Attn:
Barry Grossman, Esq., as their respective agent to accept and acknowledge on its behalf service of any and all process which may
be served in any arbitration, action, proceeding or counterclaim in any way relating to or arising out of this Agreement. The Company
further agrees to take any and all action as may be necessary to maintain such designation and appointment of such agent in full
force and effect for a period of seven years from the date of this Agreement.

 

6.12 WAIVER
OF TRIAL BY JURY. EACH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES THE RIGHT TO A TRIAL BY JURY IN ANY ACTION, SUIT,
COUNTERCLAIM OR OTHER PROCEEDING (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF, CONNECTED WITH OR RELATING TO THIS
AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREBY, OR THE ACTIONS OF THE INVESTORS IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE
OR ENFORCEMENT HEREOF.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

    13

     

    

 

IN WITNESS WHEREOF, the parties have caused
this Registration Rights Agreement to be executed and delivered by their duly authorized representatives as of the date first written
above. 

 

	 	COMPANY:
	 	 
	 	EAST STONE ACQUISITION CORPORATION

 

	 	By:	      
	 	 	Name: 	Xiaoma (Sherman) Lu
	 	 	Title:	Chief Executive Officer

 

	 	INVESTORS:
	 	 
	 	DOUBLE VENTURES HOLDINGS LIMITED

 

	 	By:	        
	 	 	Name: 	Chunyi (Charlie) Hao
	 	 	Title:	Director

 

	 	NAVY SAIL INTERNATIONAL LIMITED
	 	 
	 	By:	 
	 	 	Name:  	Chunyi (Charlie) Hao
	 	 	Title:	Director

 

	 	HUA MAO

 

	 	By:	      
	 	 	Name: 	Hua Mao

 

	 	CHENG ZHAO

 

	 	By:	      
	 	 	Name: 	Cheng Zhao

 

	 	I-BANKERS SECURITIES, INC.

 

	 	By:	      
	 	 	Name: 	 
	 	 	Title:	 

 

[Signature Page to Registration Rights
Agreement] 

 

    14

     

    

 

EXHIBIT A

 

	Name	 	Address
	Double Ventures Holdings Limited	 	[ ]
	Navy Sail International Limited	 	[ ]
	Hua Mao	 	[ ]
	Cheng Zhao	 	[ ]
	I-Bankers Securities, Inc.	 	[ ]

 

 

15Document

Description of the Registrant’s Securities Registered Pursuant
to Section 12 of the Securities Exchange Act of 1934, as amended
The summary of the general terms and provisions of the registered securities of Terreno Realty Corporation (“Terreno,” “us,” “we,” or “our”) set forth below does not purport to be complete and is subject to, and qualified in its entirety by, and should be read in conjunction with, the applicable provisions of our Articles of Amendment and Restatement, as further amended (our “Articles”), and our Amended and Restated Bylaws, as amended (our “Bylaws”), each of which are incorporated herein by reference and are filed as an exhibit to our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission, as well as the applicable provisions of Maryland law.
General
Our Articles provide that we may issue up to 400,000,000 shares of common stock, $.01 par value per share (“Common Stock”), and 100,000,000 shares of preferred stock, $.01 par value per share (“Preferred Stock”).
Common Stock 
Only our Common Stock is registered under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and all shares of our Common Stock have equal rights as to earnings, assets, dividends and voting. 
Dividend Rights
Dividends may be paid to the holders of our Common Stock if, as and when authorized by our board of directors and declared by us out of funds legally available therefor, subject to the restrictions on the transfer and ownership of our stock contained in our Articles and the preferential rights of holders of any other class or series of our stock.
Voting Rights
Subject to the restrictions on the transfer and ownership of our stock contained in our Articles and except as may otherwise be specified in the terms of any class or series of Common Stock, each share of our Common Stock entitles the holder to one vote on all matters submitted to a vote of stockholders, including the election of directors. Except as may be provided with respect to any other class or series of stock, the holders of our Common Stock will possess exclusive voting power.
See “Certain Provisions of Maryland Law and our Articles and Bylaws- Board of Directors; Vacancies; Removals” below for more information.
Distributions on Liquidation
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 payment of, or adequate provision for, all of our known 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, and to the restrictions on the transfer and ownership of our stock contained in our Articles.
Other Rights
Shares of our Common Stock generally have no preemptive, appraisal, preferential exchange, conversion, sinking fund or redemption rights and are freely transferable, except where their transfer is restricted by federal and state securities laws, by contract or by the restrictions in our Articles. 
Restrictions on Transfer 
To assist us in complying with certain U.S. federal income tax requirements applicable to real estate investment trusts (“REITs”), among other purposes, we have adopted certain restrictions relating to the transfer and ownership of our stock. See "Restrictions on Transfer" below for more information. 
Stock Exchange Listing 

Our Common Stock is listed on the New York Stock Exchange under the symbol “TRNO.” 
Transfer Agent and Registrar 
Our transfer agent and registrar for our Common Stock is Computershare Trust Company, N.A. 
Preferred Stock 
Our board of directors may authorize the issuance of shares of our Preferred Stock in one or more series and may determine, with respect to any such series, the rights, preferences, privileges and restrictions of the shares of Preferred Stock of that series, including distribution rights, conversion rights, voting rights, redemption rights and terms of redemptions and liquidation preferences. 
The issuance of shares of our Preferred Stock could have the effect of delaying, deferring or preventing a change in control or other transaction that might involve a premium price for shares of our Common Stock or otherwise be in the best interests of our shareholders. In addition, any shares of our Preferred Stock that we issue could rank senior to shares of our Common Stock with respect to the payment of distributions, in which case we could not pay any distributions on shares of our Common Stock until full distributions have been paid with respect to such shares of our Preferred Stock. 
Restrictions on Transfer 
In order for us to qualify as a REIT under the Internal Revenue Code of 1986, as amended (the “Code”), our stock must be beneficially owned by 100 or more persons during at least 335 days of a taxable year of 12 months or during a proportionate part of a shorter taxable year (other than the first year for which an election to be a REIT has been made). Also, not more than 50% of the value of the outstanding shares of stock may be owned, directly or indirectly, by five or fewer “individuals” (as defined in the Code to include certain entities) during the last half of a taxable year (other than the first year for which an election to be a REIT has been made). 
Our Articles contain restrictions on the ownership and transfer of our stock. The relevant sections of our Articles provide that, commencing with the last day of the first half of the second taxable year for which we have elected to be classified as REIT, no individual (as defined under the Code to include certain entities) may actually or constructively own more than 9.8% in value of the aggregate of our outstanding shares of stock or more than 9.8% in value or number of shares, whichever is more restrictive, of the outstanding shares of our Common Stock. In addition, the applicable articles supplementary for any series of Preferred Stock will generally prohibit any individual (as defined in the Code to include certain entities) from actually or constructively owning more than 9.8% in value or number of shares, whichever is more restrictive, of the outstanding shares of the applicable series of preferred stock. Subject to the exceptions described below, our Articles further prohibit any person or entity from beneficially or constructively owning shares in excess of these limits. We refer to these restrictions as the “ownership limits” and we sometimes refer to the restrictions on ownership by a person or entity separately as the “related party tenant limit.” We refer to a person or entity that would, but for the restrictions in our Articles, have beneficially or constructively owned shares of our stock in violation of the applicable ownership limit or the other restrictions on ownership and transfer of our stock described below and, if appropriate in the context, any person or entity that would have been the record owner of such shares as a “prohibited owner.” 
The beneficial and constructive ownership rules under the Code are complex and may cause stock owned actually or constructively by a group of related individuals and/or entities to be owned constructively by one individual or entity. As a result, the acquisition of less than 9.8% in value of our outstanding stock or less than 9.8% in value or number of our shares of our Common Stock or Preferred Stock (or the acquisition of an interest in an entity that owns, actually or constructively, our stock) by an individual or entity could, nevertheless, cause that individual or entity, or another individual or entity, to own constructively in excess of 9.8% in value of our outstanding stock or 9.8% in value or number of our outstanding shares of Common Stock or Preferred Stock and thereby violate the applicable ownership limit. 
Our Articles provide that, subject to our directors’ duties under applicable law, upon request, our board of directors will, prospectively or retroactively, waive the related party tenant limit with respect to a particular stockholder, and establish a different ownership limitation for the stockholder, unless such stockholder’s increased ownership of our stock would result in us failing to qualify as a REIT or our board of directors determines in its sole judgment that such stockholder’s increased ownership could result in any of our rental income failing to qualify as such for REIT testing purposes as a result of the “related party tenant” rules that apply to REITs. As a condition of such waiver, our board of directors may require certain representations and undertakings from the stockholder and/or an opinion of counsel or IRS ruling satisfactory to our board of directors with respect to preserving our REIT status. 

Our board of directors may from time to time increase the ownership limits for one or more persons or entities and decrease the ownership limits for all other persons and entities unless, after giving effect to such modification of the ownership limits, five or fewer individuals could beneficially own more than 49.9% in value of our outstanding stock or we would otherwise fail to qualify as a REIT. Any such decrease in the ownership limits will not apply to any person or entity whose ownership of our stock exceeds the decreased ownership limits until the person’s or entity’s ownership of our stock equals or falls below the decreased ownership limits, but any further acquisition of our stock by such a person or entity will violate the decreased ownership limits. 
Our Articles further prohibit: 
•any person from transferring shares of our stock if such transfer would result in shares of our stock being beneficially owned by fewer than 100 persons (determined without reference to any rules of attribution); and 
•any person from owning shares of our stock if such ownership would result in our failing to qualify as a REIT for federal income tax purposes. 
Any person who acquires or attempts or intends to acquire beneficial or constructive ownership of shares of our stock that will or may violate the ownership limits or any of the other foregoing limitations on transferability and ownership will be required to give notice immediately to us and provide us with such other information as we may request in order to determine the effect of such transfer on our status as a REIT. The foregoing provisions on transferability and ownership will not apply if our board of directors determines that it is no longer in our best interests to attempt to qualify, or to continue to qualify, as a REIT or that compliance with any or all of the restrictions on ownership and transfer of our stock is no longer required in order for us to qualify as a REIT, but only to the extent thereof. 
If any purported transfer of our stock or any other event would otherwise result in any person violating the ownership limit or such other limit as established by our board of directors or would result in our failing to qualify as a REIT, then that number of shares in excess of the ownership limit or causing us to fail to qualify as a REIT (rounded up to the nearest whole share) will be automatically transferred to, and held by, a trust for the exclusive benefit of one or more charitable organizations selected by us. The automatic transfer will be effective as of the close of business on the business day prior to the date of the violative transfer or other event that results in a transfer to the trust. Any dividend or other distribution paid to the prohibited owner, prior to our discovery that the shares had been automatically transferred to a trust as described above must be repaid to the trustee upon demand for distribution to the beneficiary of the trust. If the transfer to the trust as described above is not automatically effective, for any reason, to prevent violation of the applicable ownership limit or our failing to qualify as a REIT, then our Articles provide that the transfer of the shares resulting in such violation will be void. If any transfer would result in shares of our stock being beneficially owned by fewer than 100 persons, then any such purported transfer will be void and of no force or effect. 
Shares of our stock transferred to the trustee are deemed to be offered for sale to us or our designee at a price per share equal to the lesser of (i) the price per share in the transaction that resulted in such transfer to the trust (or, in the case of a devise or gift, the market price at the time of such devise or gift) and (ii) the market price on the date we accept, or our designee accepts, such offer. We may reduce the amount so payable to the trustee by the amount of any dividends or other distributions paid to the prohibited owner and owed by the prohibited owner to the trustee as described above and pay such amount to the trustee for distribution to the beneficiary of the trust. We have the right to accept such offer until the trustee has sold the shares of our stock held in the trust as discussed below. Upon a sale to us, the interest of the charitable beneficiary in the shares sold terminates and the trustee must distribute the net proceeds of the sale to the prohibited owner and any dividends or other distributions held by the trustee with respect to such stock to the charitable beneficiary. 
If we do not buy the shares, the trustee must, within 20 days of receiving notice from us of the transfer of shares to the trust, sell the shares to a person or entity designated by the trustee who could own the shares without violating the ownership limits or other restrictions on ownership and transfer of our stock. After that, the trustee must distribute to the prohibited owner an amount equal to the lesser of (i) the price paid by the prohibited owner for the shares or, if the prohibited owner did not give value for the shares in connection with the event causing the shares to be held in trust (e.g., in the cause of a gift, devise or other such transaction), the market price of the shares on the day of the event causing the shares to be held in the trust, and (ii) the sales proceeds (net of commissions and other expenses of sale) received by the trustee for the shares. The trustee may reduce the amount payable to the prohibited owner by the amount of any dividends or other distributions paid to the prohibited owner and owed by the prohibited owner to the trustee as described above. Any net sales proceeds in excess of the amount payable to the prohibited owner will be immediately paid to the charitable beneficiary, together with any dividends or other distributions thereon. In addition, if prior to discovery by us that shares of our stock have been transferred to a trust, such shares of stock are sold by a prohibited owner, then such shares shall be deemed to have been sold on behalf of the trust and to the extent that the prohibited owner received an amount for, or in respect of, such shares that exceeds the amount that such prohibited owner was 

entitled to receive, such excess amount shall be paid to the trustee upon demand. The prohibited owner has no rights in the shares held by the trustee. 
The trustee shall be designated by us and shall be unaffiliated with us and with any prohibited owner. Prior to the sale of any shares by the trust, the trustee will receive, in trust for the beneficiary, all dividends and other distributions paid by us with respect to the shares, and may also exercise all voting rights with respect to the shares. 
Subject to Maryland law, effective as of the date that the shares have been transferred to the trust, the trustee shall have the authority, at the trustee’s sole discretion: 
•to rescind as void any vote cast by a prohibited owner prior to our discovery that the shares have been transferred to the trust; and 
•to recast the vote in accordance with the desires of the trustee acting for the benefit of the beneficiary of the trust. 
However, if we have already taken irreversible corporate action, then the trustee may not rescind and recast the vote. 
In addition, if our board of directors determines in good faith that a proposed transfer or other event has occurred that would result in a violation of the restrictions on ownership and transfer of our stock set forth in our Articles, our board of directors will take such action as it deems advisable to refuse to give effect to or to prevent such transfer or other event, including, but not limited to, causing the company to redeem shares of Common Stock or Preferred Stock, refusing to give effect to the transfer on our books or instituting proceedings to enjoin the transfer. 
Every owner of 5% or more (or such lower percentage as required by the Code or the regulations promulgated thereunder) of the outstanding shares of our stock, upon request following the end of each of our taxable years, must give us written notice stating the person’s name and address, the number of shares of each class and series of our stock that the person beneficially owns and a description of the manner in which the shares are held. Each such owner must also provide us with any additional information that we request in order to determine the effect, if any, of such beneficial ownership on our qualification as a REIT and to ensure compliance with the ownership limits. In addition, any person or entity that is a beneficial owner or constructive owner of shares of our stock and any person or entity (including the stockholder of record) who is holding shares of our stock for a beneficial owner or constructive owner shall, on request, disclose to us in writing such information as we may request in order to determine our status as a REIT and to comply with requirements of any taxing authority or governmental authority or to determine such compliance. 
All certificates representing shares of our Common Stock and Preferred Stock bear a legend referring to the restrictions described above. 
Certain Provisions of Maryland Law and our Articles and Bylaws
The Maryland General Corporation Law (the “MGCL”) and our Articles and Bylaws 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 us to negotiate first with our board of directors. We believe that the benefits of these provisions outweigh the potential disadvantages of discouraging any such acquisition proposals because, among other things, the negotiation of such proposals may improve their terms. 
Power to Reclassify Shares of Our Stock 
Our Articles authorize our board of directors to classify and reclassify any unissued shares of stock into other classes or series of stock, including Preferred Stock. Prior to the issuance of shares of each class or series, the board of directors is required by Maryland law and by our Articles to set, subject to the restrictions on the transfer and ownership of our stock contained in our Articles and the terms of any outstanding class or series of our stock, the preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications and terms or conditions of redemption for each class or series. Thus, the board of directors could authorize the issuance of shares of Common Stock or Preferred Stock with terms and conditions which could have the effect of delaying, deferring or preventing a transaction or a change in control that might involve a premium price for holders of our Common Stock or that stockholders may believe is in their best interests. 
Power to Increase Authorized Stock and Issue Additional Shares of Our Common Stock and Preferred Stock 
Our Articles authorize our board of directors to increase the number of authorized shares of stock, issue additional authorized but unissued shares of our Common Stock or Preferred Stock and to classify or reclassify unissued shares of our Common 

Stock or Preferred Stock and thereafter to cause us to issue such classified or reclassified shares of stock without further action by our stockholders, unless stockholder consent is required by applicable law or the rules of any stock exchange or automated quotation system on which our securities may be listed or traded. We believe these provisions provide us with increased flexibility in structuring possible future financings and acquisitions and in meeting other needs which might arise. Although our board of directors does not intend to do so, it could authorize us to issue a class or series of stock that could, depending upon the terms of the particular class or series, delay, defer or prevent a transaction or a change of control that might involve a premium price for holders of our Common Stock or that stockholders may believe is in their best interest.
Board of Directors; Vacancies; Removals 
Our Articles provide that the number of directors will be set only by a majority of our entire board of directors within specified limits set forth in our Bylaws. Our Bylaws provide that a majority of our entire board of directors may at any time increase or decrease the number of directors. However, the number of directors may never be less than the minimum number required by the MGCL, which is one, nor, unless our Bylaws are amended, more than 11. Because our board of directors and our stockholders have the power to amend this provision of our Bylaws, either our board of directors or our stockholders, by a vote of a majority of the votes entitled to be cast by holders of outstanding shares of our Common Stock, could modify this provision of our Bylaws to change that range.
Our Bylaws also provide that, in an uncontested election, a director is elected if he or she receives more “for” votes than “against” or “withheld” votes to serve until our next annual meeting of stockholders and until his or her successor is duly elected and qualifies. Under our corporate governance guidelines, any director who fails to be elected by a majority vote is required to tender his or her resignation to our board of directors, subject to acceptance. Our nominating and corporate governance committee will make a recommendation to our board of directors on whether to accept or reject the resignation, or whether other action should be taken. Our board of directors will then act on our nominating and corporate governance committee’s recommendation and publicly disclose its decision and the rationale behind it within 90 days from the date of the certification of election results. If the resignation is not accepted, the director will continue to serve until the next annual meeting and until the director’s successor is duly elected and qualifies. The director who tenders his or her resignation will not participate in our board’s decision. 
Our Articles provide that, subject to the rights, if any, of holders of any class or series of our Preferred Stock to elect or remove one or more directors, a director may be removed only for cause, as defined in our Articles, and then only by the affirmative vote of at least a majority of the votes entitled to be cast generally in the election of directors. This provision precludes stockholders from removing incumbent directors without cause and filling the vacancies created by such removal with their own nominees. 
Our Bylaws empower our stockholders to fill vacancies on our board of directors that are caused by the removal of a director. Our board of directors may also fill vacancies that are caused by an increase in the number of directors, the death, resignation or removal of a director. Any director appointed by our board of directors to fill a vacancy on the board will hold office until the next annual meeting of our stockholders and until his or her successor is duly elected and qualifies. However, our corporate governance guidelines will require an individual elected by our board of directors to fill a vacancy created by the removal of a director by our stockholders to tender his or her resignation if a special meeting to approve such election is requested by our stockholders and held in accordance with the provisions of our Bylaws prior to the next annual meeting of stockholders and the director’s election is not approved by our stockholders at the special meeting. 
Action by Stockholders 
Under the MGCL, stockholder action can be taken only at an annual or special meeting of stockholders or by unanimous written consent in lieu of a meeting unless the charter provides for a lesser percentage (which our Articles currently do not). These provisions, combined with the requirements in our Bylaws regarding advance notice of nominations and other business to be considered at a meeting of stockholders and the calling of a stockholder-requested special meeting of stockholders discussed below, may have the effect of delaying consideration of a stockholder proposal. 
Advance Notice Provisions for Stockholder Nominations and Stockholder Proposals 
Our Bylaws provide that, with respect to an annual meeting of stockholders, nominations of individuals for election to the board of directors and the proposal of business to be considered by stockholders may be made only (i) pursuant to our notice of the meeting, (ii) by or at the direction of the board of directors or (iii) by a stockholder who was a stockholder of record both at the time of giving of notice by such stockholder as provided for in our Bylaws and at the time of the annual meeting and 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 and provided the information required by our Bylaws. With respect to special meetings of stockholders, only the business specified in the notice of the meeting may be brought before the meeting. Nominations of individuals for election to the board of directors at a special meeting may be made only (i) by or at the direction of the board of directors, (ii) by the stockholder that has requested that the special meeting be called for the purpose of electing directors and has complied with the procedures and provided the information required by our Bylaws in connection with such request or (iii) provided that the special meeting has been called for the purpose of electing directors, by a stockholder who was a stockholder of record both at the time of giving of notice by such stockholder as provided for in our Bylaws and at the time of the special meeting, and 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 and provided the information required by our Bylaws. 
The purpose of requiring stockholders to give us advance notice of nominations and other business is to afford our board of directors a meaningful opportunity to consider the qualifications of the proposed nominees and the advisability of any other proposed business and, to the extent deemed necessary or desirable by our board of directors, to inform stockholders and make recommendations about such qualifications or business, as well as to provide a more orderly procedure for conducting meetings of stockholders. Although our Bylaws do not give our board of directors any power to disapprove stockholder nominations for the election of directors or proposals recommending certain action, they may have the effect of precluding a contest for the election of directors or the consideration of stockholder proposals if proper procedures are not followed and of discouraging or deterring a third party from conducting a solicitation of proxies to elect its own slate of directors or to approve its own proposal without regard to whether consideration of such nominees or proposals might be harmful or beneficial to us and our stockholders. 
Calling of Special Meetings of Stockholders 
Our Bylaws provide that special meetings of stockholders may be called by our board of directors and certain of our officers. Additionally, our Bylaws provide that, subject to the satisfaction of certain procedural and informational requirements by the stockholders requesting the meeting, a special meeting of stockholders to act on any matter that may properly be considered at a meeting of stockholders shall be called by the secretary of the corporation upon the written request of stockholders entitled to cast a majority of all the votes entitled to be cast on such matter at such meeting. 
Approval of Extraordinary Corporate Action; Amendment of our Articles and Bylaws 
Under Maryland law, a Maryland corporation generally cannot dissolve, amend its charter, merge, consolidate, sell all or substantially all of its assets or engage in a share exchange, unless recommended by the 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. However, a Maryland corporation may provide in its charter for approval of these matters by a lesser percentage, but not less than a majority of all of the votes entitled to be cast on the matter. Our Articles provide, as permitted by Maryland law, that any of these actions may be approved by the affirmative vote of the stockholders entitled to cast at least a majority of the votes entitled to be cast on the matter. 
Our Bylaws may be amended by our board of directors or by the affirmative vote of a majority of the votes cast on the matter by holders of outstanding shares of our Common Stock, except the following bylaw provisions, each of which may be amended only with the affirmative vote of a majority of the votes cast on such an amendment by holders of outstanding shares of our Common Stock: 
•provisions relating to the amendment of our Bylaws;
•provisions opting out of the control share acquisition statute; and
•provisions prohibiting our board of directors without the approval of a majority of the votes entitled to be the cast by holders of outstanding shares of our Common Stock, from revoking, altering or amending any resolution, or adopting any resolution inconsistent with any previously-adopted resolution of our board of directors, that exempts any business combination between us and any other person or entity from the business combination provisions of the MGCL.
No Stockholder Rights Plan 
We have no stockholder rights plan. In the future, we do not intend to adopt a stockholder rights plan unless our stockholders approve in advance the adoption of a plan or, if adopted by our board of directors, we submit the stockholder rights plan to our stockholders for a ratification vote within 12 months of adoption or the plan will terminate. 
No Appraisal Rights 

As permitted by the MGCL, our Articles provide that stockholders will not be entitled to exercise appraisal rights unless a majority of our board of directors determines that appraisal rights will apply, with respect to all or any classes and series of stock, to one or more transactions occurring after the date of such determination in connection with which holders of such shares would otherwise be entitled to exercise appraisal rights. This is in addition to Maryland law provisions that generally eliminate appraisal rights for exchange-listed securities. 
Business Combinations 
Under the MGCL, certain “business combinations” (including a merger, consolidation, share exchange or, in certain circumstances, an asset transfer or issuance or reclassification of equity securities) between a Maryland corporation and an interested stockholder (defined as any person who beneficially owns 10% or more of the voting power of the corporation’s shares or an affiliate 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), 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. A person is not an interested stockholder under the statute if the board of directors approved in advance the transaction by which the person otherwise would have become an interested stockholder. Our board of directors may provide that its approval is subject to compliance with any terms and conditions determined by it. 
Any such business combination entered into after the five-year prohibition must be recommended by the board of directors of such corporation and approved by the affirmative vote of at least (i) 80% of the votes entitled to be cast by holders of outstanding shares of voting stock of the corporation and (ii) 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, unless, among other conditions, the corporation’s common stockholders receive a minimum price (as defined in the MGCL) for their shares and the consideration is received in cash or in the same form as previously paid by the interested stockholder for its shares. 
These provisions of the MGCL do not apply, however, to business combinations that are approved or exempted by a board of directors prior to the time that the interested stockholder becomes an interested stockholder. Our board of directors has adopted a resolution exempting any business combination between us and any other person or entity from the business combination provisions of the MGCL. Our Bylaws provide that this resolution or any other resolution of our board of directors exempting any business combination from the business combination provisions of the MGCL may only be revoked, altered or amended, and our board of directors may only adopt any resolution inconsistent with any such resolution, with the affirmative vote of a majority of the votes cast on the matter by holders of outstanding shares of our Common Stock. 
Control Share Acquisitions 
The MGCL provides that “control shares” of a Maryland corporation acquired in a “control share acquisition” have no voting rights except to the extent approved at a special meeting by the affirmative vote of two-thirds of the votes entitled to be cast on the matter, excluding shares of stock of a corporation in respect of which any of the following persons is entitled to exercise or direct the exercise of the voting power of shares of stock of the corporation in the election of directors: (i) a person who makes or proposes to make a control share acquisition, (ii) an officer of the corporation or (iii) an employee of the corporation who is also a director of the corporation. “Control shares” are voting shares of stock which, if aggregated with all other such shares of stock previously acquired by the acquiror or in respect of which the acquiror is able to exercise or direct the exercise of voting power (except solely by virtue of a revocable proxy), would entitle the acquiror to exercise voting power in electing directors within one of the following ranges of voting power: (i) one-tenth or more but less than one-third, (ii) one-third or more but less than a majority, or (iii) a majority or more of all voting power. Control shares do not include shares the acquiring person is then entitled to vote as a result of having previously obtained stockholder approval. A “control share acquisition” means the acquisition of control shares, subject to certain exceptions. 
A person who has made or proposes to make a control share acquisition, upon satisfaction of certain conditions (including an undertaking to pay expenses), may compel our board of directors to call a special meeting of stockholders to be held within 50 days of demand to consider the voting rights of the shares. If no request for a meeting is made, the corporation may itself present the question at any stockholders meeting. 
If voting rights are not approved at the meeting or if the acquiring person does not deliver an acquiring person statement as required by the statute, then, subject to certain conditions and limitations, the corporation may redeem any or all of the control shares (except those for which voting rights have previously been approved) for fair value 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 acquiror or of any meeting of stockholders at which the voting rights of such shares are considered and not approved. If voting rights for control 

shares are approved at a stockholders meeting and the acquiror 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 such appraisal rights may not be less than the highest price per share paid by the acquiror in the control share acquisition. 
The control share acquisition statute does not apply (i) to shares acquired in a merger, consolidation or share exchange if the corporation is a party to the transaction or (ii) to acquisitions approved or exempted by the charter or bylaws of the corporation. 
Our Bylaws exempt any and all acquisitions of shares of our stock from the control share acquisition statute, and this provision of our Bylaws may not be amended without the affirmative vote of a majority of the votes cast on the matter by holders of outstanding shares of our Common Stock. 
Certain Elective Provisions of Maryland Law 
Title 3, Subtitle 8 of the MGCL permits a Maryland corporation with a class of equity securities registered under the Exchange Act and at least three independent directors to elect to be subject, by provision in its charter or bylaws or a resolution of its board of directors and notwithstanding any contrary provision in the charter or bylaws, to any of (i) a classified board, (ii) a two-thirds vote requirement for removing a director, (iii) a requirement that the number of directors be fixed only by vote of the directors, (iv) a requirement that a vacancy on the board be filled only by the remaining directors and for the remainder of the full term of the class of directors in which the vacancy occurred, or (v) a majority requirement for the calling of a special meeting of stockholders.
We have not elected to be governed by the specific provisions set forth above but, subject to certain conditions and the exception described below, we could elect to provide for any of the foregoing provisions in the future. Our board of directors adopted a resolution prohibiting us from electing to be subject to the provisions of Title 3, Subtitle 8 of the MGCL that would permit us to classify our board of directors without stockholder approval. By adopting this resolution, we will be prohibited from classifying our board of directors without first obtaining stockholder approval. 
Indemnification and Limitation of Directors’ and Officers’ Liability 
The MGCL permits a Maryland corporation to include in its charter a provision limiting the liability of its directors and officers to the corporation and its stockholders for money damages except for liability resulting from actual receipt of an improper benefit or profit in money, property or services or active and deliberate dishonesty that is established by a final judgment and is material to the cause of action. Our Articles contains a provision that eliminates such liability to the maximum extent permitted by Maryland law. 
Our Articles authorize us, to the maximum extent that Maryland law in effect from time to time permits, to indemnify any present or former director or officer or any individual who, while a director or officer of Terreno 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, from and against any claim or liability to which that individual may become subject or which that individual may incur by reason of his or her service in any such capacity and to pay or reimburse his or her reasonable expenses in advance of final disposition of a proceeding. Our Bylaws obligate us, to the fullest extent permitted by Maryland law in effect from time to time, to indemnify and, without requiring a preliminary determination of the ultimate entitlement to indemnification, pay or reimburse reasonable expenses in advance of final disposition of a proceeding to: 
•any present or former director or officer who is made or threatened to be made a party to the proceeding by reason of his or her service in that capacity; or 
•any individual who, while a director or officer of Terreno 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 any other enterprise as a director, officer, partner, member, manager or trustee of such corporation, real estate investment trust, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise and who is made or threatened to be made a party to the proceeding by reason of his or her service in that capacity. 
Our Articles and Bylaws also permit us to indemnify and advance expenses to any person who served a predecessor of ours in any of the capacities described above and to any employee or agent of Terreno or a predecessor of Terreno. 
The MGCL requires a corporation (unless its charter provides otherwise, which our Articles do not) to indemnify a director or officer who has been successful, on the merits or otherwise, 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. The MGCL 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 are threatened to be made a party by reason of their service in those or other capacities unless it is established that: 
•the act or omission of the director or officer was material to the matter giving rise to the proceeding; and 
•was committed in bad faith; or 
•was the result of active and deliberate dishonesty; or 
•the director or officer actually received an improper personal benefit in money, property or services; or 
•in the case of any criminal proceeding, the director or officer had reasonable cause to believe that the act or omission was unlawful. 
However, under the MGCL, a Maryland corporation may not indemnify for an adverse judgment in a suit by or in the right of the corporation or for a judgment of liability on the basis that personal benefit was improperly received. A court may order indemnification if it determines that the director or officer is fairly and reasonably entitled to indemnification, even though the director or officer did not meet the prescribed standard of conduct, was adjudged liable to the corporation or was adjudged liable on the basis that personal benefit was improperly received. However, indemnification for an adverse judgment in a suit by or in the right of the corporation, or for a judgment of liability on the basis that personal benefit was improperly received, is limited to expenses. 
In addition, the MGCL permits a corporation to advance reasonable expenses to a director or officer upon the corporation’s receipt of: 
•a written affirmation by the director or officer of his good faith belief that he has met the standard of conduct necessary for indemnification by the corporation; and 
•a written undertaking by the director or officer or on the director’s or officer’s behalf to repay the amount paid or reimbursed by the corporation if it is ultimately determined that the director or officer did not meet the standard of conduct. 
Insofar as the foregoing provisions permit indemnification of directors, officers or persons controlling us for liability arising under the Securities Act of 1933, as amended (the “Securities Act”), we have been informed that in the opinion of the Securities and Exchange Commission, this indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable. 
We have entered into an indemnification agreement with each of our executive officers and directors whereby we indemnify such executive officers and directors to the fullest extent permitted by Maryland law against all expenses and liabilities, subject to limited exceptions. These indemnification agreements also provide that upon an application for indemnity by an executive officer or director to a court of appropriate jurisdiction, such court may order us to indemnify such executive officer or director.

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