Document:

Exhibit 4.6

CLEANTECH ACQUISITION CORP.

 

DESCRIPTION OF SECURITIES

 

The following summary of the
material terms of the securities of CleanTech Acquisition Corp., a Delaware corporation (“we,” “us,” “our”
or the “Company”), is not intended to be a complete summary of the rights and preferences of such securities and is subject
to and qualified by reference to our amended and restated certificate of incorporation, our amended and restated bylaws and the warrant
agreement, dated July 14, 2021, between the Company and Continental Stock Transfer & Trust Company (the “warrant agreement”),
in each case incorporated by reference as exhibits to the Company’s Annual Report on Form 10-K for the year ended December 31, 2021
(the “Report”), and applicable Delaware law, including the Delaware General Corporation Law, or DGCL. We urge you to read
our amended and restated certificate of incorporation, our amended and restated bylaws and the warrant agreement in their entirety for
a complete description of the rights and preferences of our securities.

 

Pursuant to our amended certificate
of incorporation, our authorized capital stock consists of 200,000,000 shares of common stock, par value $0.0001, and 1,000,000 shares
of preferred stock, par value $0.0001. As of the date of this Report, 21,562,500 shares of common stock are issued and outstanding.
No preferred shares are issued or outstanding.

 

Units

 

Each unit consists of one share
of common stock, one right and one-half of one warrant. Each right entitles the holder to receive one-twentieth (1/20) of a
share of common stock. Each whole warrant entitles the holder thereof to purchase one share of common stock at a price of $11.50 per whole
share, subject to adjustment as described in the warrant agreement. We will not issue fractional securities. As a result, you must have
20 rights to receive a share of common stock at the closing of the initial business combination and 2 units to receive a share of common
stock when exercising your warrants. Each private warrant entitles the holder thereof to purchase one share of common stock. Each warrant
will become exercisable on the later of one year after the closing of our initial public offering or the consummation of an initial business
combination, and will expire five years after the completion of an initial business combination, or earlier upon redemption. The private
warrants purchased by CleanTech Investments will not be exercisable more than five years from the effective date of the registration statement
for our initial public offering, in accordance with FINRA Rule 5110(g)(8), as long as Chardan Capital Markets, LLC or any of its
related persons beneficially own these private warrants.

 

Common Stock

 

Our holders of record of our
common stock are entitled to one vote for each share held on all matters to be voted on by stockholders. In connection with any vote held
to approve our initial business combination, our insiders, officers and directors, have agreed to vote their respective shares of common
stock owned by them immediately prior to our initial public offering, including both the insider shares and any shares acquired in our
initial public offering or following our initial public offering in the open market, in favor of the proposed business combination.

 

We will consummate our initial
business combination only if public stockholders do not exercise conversion rights in an amount that would cause our net tangible assets
to be less than $5,000,001 and a majority of the outstanding shares of common stock voted are voted in favor of the business combination.

 

    1

     

    

 

Pursuant to our certificate
of incorporation, if we do not consummate our initial business combination within 12 months (or up to 18 months, as applicable)
from the closing of our initial public offering, we will (i) cease all operations except for the purpose of winding up, (ii) as
promptly as reasonably possible but not more than ten business days thereafter, redeem 100% of the outstanding public shares, which redemption
will completely extinguish public stockholders’ rights as stockholders (including the right to receive further liquidation distributions,
if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval
of our remaining stockholders and our board of directors, dissolve and liquidate, subject (in the case of (ii) and (iii) above)
to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. Our insiders
have agreed to waive their rights to share in any distribution with respect to their insider shares. However, if we anticipate that we
may not be able to consummate our initial business combination within 12 months, our initial stockholders or their affiliates may,
but are not obligated to, extend the period of time to consummate an initial business combination 2 times by an additional three months
each time (for a total of up to 18 months to complete an initial business combination) without the need for a separate stockholder
vote. Pursuant to the terms of our amended and restated certificate of incorporation and the trust agreement entered into between us and
Continental Stock Transfer & Trust Company, the only way to extend the time available for us to consummate our initial business combination
without the need for a separate stockholder vote is for our initial stockholders or their affiliates or designees, upon five days’
advance notice prior to the applicable deadline, to deposit into the trust account $1,500,000, or $1,725,000 if the underwriters’
over-allotment option is exercised in full ($0.10 per public share, or an aggregate of $3,000,000 (or $3,450,000 if the over-allotment option
is exercised in full) if extended for each of the full three months), on or prior to the date of the applicable deadline. Pursuant to
our amended and restated certificate of incorporation and the trust agreement, if such funds are not deposited, the time to complete an
initial business combination cannot be extended unless our stockholders otherwise approve an extension on different terms. In the event
that they elected to extend the time to complete our initial business combination and deposited the applicable amount of money into trust,
the initial stockholders would receive a non-interest bearing, unsecured promissory note equal to the amount of any such deposit
that will not be repaid in the event that we are unable to close a business combination unless there are funds available outside the trust
account to do so. Such note would be paid upon consummation of our initial business combination. In the event that we receive notice from
our insiders five days prior to the applicable deadline of their intent to effect an extension, we intend to issue a press release announcing
such intention at least three days prior to the applicable deadline.

 

Our stockholders have no conversion,
preemptive or other subscription rights and there are no sinking fund or redemption provisions applicable to the shares of common stock,
except that public stockholders have the right to sell their shares to us in any tender offer or have their shares of common stock converted
to cash equal to their pro rata share of the trust account if they vote on the proposed business combination and the business combination
is completed. In order for a public stockholder to have his, her or its shares redeemed for cash in connection with any proposed business
combination, we may require that the public stockholders vote either in favor of or against a proposed business combination. If required
to vote pursuant to the procedures specified in our proxy statement to stockholders relating to the business combination, and a public
stockholder fails to vote in favor of or against the proposed business combination, whether that stockholder abstains from the vote or
simply does not vote, that stockholder would not be able to have his, her or its shares of common stock redeemed to cash in connection
with such business combination.

 

If we hold a stockholder vote
to amend any provisions of our certificate of incorporation relating to stockholder’s rights or pre-business combination activity
(including the substance or timing within which we have to complete a business combination), we will provide our public stockholders with
the opportunity to redeem their shares of common stock upon approval of any such amendment at a per-share price, payable in cash,
equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and
not previously released to us to pay our taxes or for working capital purposes, divided by the number of then outstanding public shares,
in connection with any such vote. In either of such events, converting stockholders would be paid their pro rata portion of the trust
account promptly following consummation of the business combination or the approval of the amendment to the certificate of incorporation.
If the business combination is not consummated or the amendment is not approved, stockholders will not be paid such amounts.

 

    2

     

    

 

Preferred Stock

 

There are no shares of preferred
stock outstanding. No shares of preferred stock are being issued or registered in our initial public offering. Accordingly, our board
of directors is empowered, without stockholder approval, to issue preferred stock with dividend, liquidation, conversion, voting or other
rights which could adversely affect the voting power or other rights of the holders of common stock. However, the underwriting agreement
prohibits us, prior to a business combination, from issuing preferred stock which participates in any manner in the proceeds of the trust
account, or which votes as a class with the common stock on our initial business combination. We may issue some or all of the preferred
stock to effect our initial business combination. In addition, the preferred stock could be utilized as a method of discouraging, delaying
or preventing a change in control of us. Although we do not currently intend to issue any shares of preferred stock, we reserve the right
to do so in the future.

 

Warrants

 

No warrants are currently outstanding.
Each whole public warrant entitles the registered holder to purchase one share of common stock at a price of $11.50 per whole share, subject
to adjustment as described below, at any time commencing on the later of one year after the closing of our initial public offering or
the consummation of an initial business combination. However, no public warrants will be exercisable for cash unless we have an effective
and current registration statement covering the shares of common stock issuable upon exercise of the warrants and a current prospectus
relating to such shares of common stock. Notwithstanding the foregoing, if a registration statement covering the shares of common stock
issuable upon exercise of the public warrants is not effective within 120 days from the closing of our initial business combination,
warrant holders may, until such time as there is an effective registration statement and during any period when we shall have failed to
maintain an effective registration statement, exercise warrants on a cashless basis pursuant to an available exemption from registration
under the Securities Act. The warrants will expire five years from the closing of our initial business combination at 5:00 p.m.,
New York City time.

 

The private warrants are identical
to the public warrants underlying the units offered in our initial public offering except that (i) each private warrant is exercisable
for one share of common stock at an exercise price of $11.50 per share, and (ii) such private warrants will be exercisable for cash
(even if a registration statement covering the shares of common stock issuable upon exercise of such warrants is not effective) or on
a cashless basis, at the holder’s option, and will not be redeemable by us, in each case so long as they are still held by the initial
purchasers or their affiliates. The private warrants purchased by CleanTech Investments will not be exercisable more than five years from
the effective date of the registration statement for our initial public offering, in accordance with FINRA Rule 5110(g)(8), as long
as Chardan Capital Markets, LLC or any of its related persons beneficially own these private warrants.

 

We may call the outstanding
warrants for redemption (excluding the private warrants but including any warrants already issued upon exercise of the unit purchase option),
in whole and not in part, at a price of $0.01 per warrant:

 

		•	at any time while the warrants are exercisable,

 

		•	upon not less than 30 days’ prior written notice
of redemption to each warrant holder,

 

		•	if, and only if, the reported last sale price of the shares
of common stock equals or exceeds $16.50 per share, for any 20 trading days within a 30-day trading period ending on the third business
day prior to the notice of redemption to warrant holders, and

 

		•	if, and only if, there is a current registration statement in
effect with respect to the shares of common stock underlying such warrants at the time of redemption and for the entire 30-day trading
period referred to above and continuing each day thereafter until the date of redemption.

 

The right to exercise will
be forfeited unless the warrants are exercised prior to the date specified in the notice of redemption. On and after the redemption date,
a record holder of a warrant will have no further rights except to receive the redemption price for such holder’s warrant upon surrender
of such warrant.

 

The redemption criteria for
our warrants have been established at a price which is intended to provide warrant holders a reasonable premium to the initial exercise
price and provide a sufficient differential between the then-prevailing share price and the warrant exercise price so that if the
share price declines as a result of our redemption call, the redemption will not cause the share price to drop below the exercise price
of the warrants.

 

    3

     

    

 

If we call the warrants for
redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a
“cashless basis.” In such event, each holder would pay the exercise price by surrendering the warrants for that number of
shares of common stock equal to the quotient obtained by dividing (x) the product of the number of shares of common stock underlying
the warrants, multiplied by the difference between the exercise price of the warrants and the “fair market value” by (y) the
fair market value. The “fair market value” shall mean the average reported last sale price of our common stock for the 10
trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Whether
we will exercise our option to require all holders to exercise their warrants on a “cashless basis” will depend on a variety
of factors including the price of our common shares at the time the warrants are called for redemption, our cash needs at such time and
concerns regarding dilutive share issuances.

 

The warrants will be issued
in registered form under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us. The
warrant agreement provides that the terms of the warrants may be amended without the consent of any holder to cure any ambiguity or correct
any defective provision, but requires the approval, by written consent or vote, of the holders of a majority of the then outstanding warrants
in order to make any change that adversely affects the interests of the registered holders.

 

The exercise price and number
of shares of common stock issuable on exercise of the warrants may be adjusted in certain circumstances including in the event of a share
dividend, extraordinary dividend or our recapitalization, reorganization, merger or consolidation. In addition, if we issue additional
shares of common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business
combination at a newly issued price of less than $9.20 per share of common stock (with such issue price or effective issue price to be
determined in good faith by our board of directors and, in the case of any such issuance to our initial stockholders or their affiliates,
without taking into account any founder shares or private warrants held by them, as applicable, prior to such issuance), the exercise
price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the newly issued price and the $16.50 per share redemption
trigger price described below under will be adjusted (to the nearest cent) to be equal to 165% of the market value (the volume weighted
average trading price of the common stock during the 20 trading day period starting on the trading day prior to the consummation
of an initial business combination).

 

The warrants may be exercised
upon surrender of the warrant certificate on or prior to the expiration date at the offices of the warrant agent, with the exercise form
on the reverse side of the warrant certificate completed and executed as indicated, accompanied by full payment of the exercise price,
by certified or official bank check payable to us, for the number of warrants being exercised. The warrant holders do not have the rights
or privileges of holders of shares of common stock and any voting rights until they exercise their warrants and receive shares of common
stock. After the issuance of shares of common stock upon exercise of the warrants, each holder will be entitled to one vote for each share
held of record on all matters to be voted on by stockholders.

 

Except as described above,
no public warrants will be exercisable for cash, and we will not be obligated to issue shares of common stock unless at the time a holder
seeks to exercise such warrant, a prospectus relating to the shares of common stock issuable upon exercise of the warrants is current
and the shares of common stock have been registered or qualified or deemed to be exempt under the securities laws of the state of residence
of the holder of the warrants. Under the terms of the warrant agreement, we have agreed to use our best efforts to meet these conditions
and to maintain a current prospectus relating to the shares of common stock issuable upon exercise of the warrants until the expiration
of the warrants. However, we cannot assure you that we will be able to do so and, if we do not maintain a current prospectus relating
to the shares of common stock issuable upon exercise of the warrants, holders will be unable to exercise their warrants, and we will not
be required to settle any such warrant exercise. If the prospectus relating to the shares of common stock issuable upon the exercise of
the warrants is not current or if the common stock is not qualified or exempt from qualification in the jurisdictions in which the holders
of the warrants reside, we will not be required to net cash settle or cash settle the warrant exercise, the warrants may have no value,
the market for the warrants may be limited, and the warrants may expire worthless.

 

A holder of a warrant may notify
us in writing in the event it elects to be subject to a requirement that such holder will not have the right to exercise such warrant,
to the extent that after giving effect to such exercise, such person (together with such person’s affiliates), to the warrant agent’s
actual knowledge, would beneficially own in excess of 4.99% or 9.99% (or such other amount as a holder may specify) of common stock outstanding.

 

No fractional shares will be
issued upon exercise of the warrants. If, upon exercise of the warrants, a holder would be entitled to receive a fractional interest in
a share, we will, upon exercise, round down to the nearest whole number the number of shares of common stock to be issued to the warrant
holder.

 

    4

     

    

 

We have agreed that, subject
to applicable law, any action, proceeding or claim against us arising out of or relating in any way to the warrant agreement will be brought
and enforced in the courts of the State of New York or the United States District Court for the Southern District of New York,
and we irrevocably submit to such jurisdiction, which jurisdiction will be the exclusive forum for any such action, proceeding or claim.
See “Risk Factors — Our warrant agreement will designate the courts of the State of New York or the United States
District Court for the Southern District of New York as the sole and exclusive forum for certain types of actions and proceedings
that may be initiated by holders of our warrants, which could limit the ability of warrant holders to obtain a favorable judicial forum
for disputes with our company.” This provision applies to claims under the Securities Act but does not apply to claims
under the Exchange Act or any claim for which the federal district courts of the United States of America are the sole
and exclusive forum.

 

Contractual Arrangements with respect to the Certain Warrants

 

We have agreed that so long
as the private warrants are still held by the initial purchasers or their affiliates, we will not redeem such warrants, and we will allow
the holders to exercise such warrants on a cashless basis (even if a registration statement covering the shares of common stock issuable
upon exercise of such warrants is not effective). However, once any of the foregoing warrants are transferred from the initial purchasers
or their affiliates, these arrangements will no longer apply. Furthermore, because the private warrants will be issued in a private transaction,
the holders and their transferees will be allowed to exercise the private warrants for cash even if a registration statement covering
the shares of common stock issuable upon exercise of such warrants is not effective and receive unregistered shares of common stock.

 

Rights

 

Each right represents the right
to receive one-twentieth (1/20) of one share of common stock upon the consummation of our initial business combination, so each holder
of 20 rights will receive one share of common stock upon consummation of our initial business combination, whether or not we will be the
surviving entity and even if the holder of such right redeemed all common stock held by him, her or it in connection with the initial
business combination or an amendment to our amended and restated certificate of incorporation with respect to our pre-business combination
activities. No fractional shares will be issued upon conversion of any rights, so holders must hold rights in denominations of 20 in order
to receive a share of our common stock at the closing of our initial business combination. No additional consideration will be required
to be paid by a holder of rights in order to receive his, her or its additional common stock upon consummation of an initial business
combination as the consideration related thereto has been included in the unit purchase price paid for by investors in our initial public
offering. The shares issuable upon exchange of the rights will be freely tradable (except to the extent held by affiliates of ours).

 

As soon as practicable upon
the occurrence of our initial business combination, we will direct holders of the rights to return their rights certificates to Continental
Stock Transfer & Trust Company, in its capacity as rights agent. Upon receipt of the rights certificate, in a business combination
in which we will be the surviving entity, we will issue to the registered holder of such rights the number of full shares of our common
stock to which the holder is entitled.

 

If we enter into a definitive
agreement for a business combination in which we will not be the surviving entity, the definitive agreement will provide for the holders
of rights to receive the same per share consideration the holders of the common stock will receive in the transaction on an as-converted into
common stock basis, and each holder of a right will be required to affirmatively convert his, her or its rights in order to receive the
one-twentieth (1/20) share underlying each right (without paying any additional consideration) upon consummation of the business
combination. More specifically, the right holder will be required to indicate his, her or its election to convert the rights into underlying
shares as well as to return the original rights certificates to us.

 

If we are unable to complete
an initial business combination within the required time period and we liquidate the funds held in the trust account, holders of rights
will not receive any of such funds with respect to their rights, nor will they receive any distribution from our assets held outside of
the trust account with respect to such rights, and the rights will expire worthless.

 

Promptly upon the consummation
of our initial business combination, we will direct registered holders of the rights to return their rights to our rights agent. Upon
receipt of the rights, the rights agent will issue to the registered holder of such right(s) the number of full shares of common stock
to which he, she or it is entitled. We will notify registered holders of the rights to deliver their rights to the rights agent promptly
upon consummation of such business combination and have been informed by the rights agent that the process of exchanging their rights
for common stock should take no more than a matter of days. The foregoing exchange of rights is solely ministerial in nature and is not
intended to provide us with any means of avoiding our obligation to issue the shares underlying the rights upon consummation of our initial
business combination. Other than confirming that the rights delivered by a registered holder are valid, we will have no ability to avoid
delivery of the shares underlying the rights. Nevertheless, there are no contractual penalties for failure to deliver securities to the
holders of the rights upon consummation of an initial business combination. Additionally, in no event will we be required to net cash
settle the rights. Accordingly, the rights may expire worthless.

 

    5

     

    

 

We will not issue any fractional
shares upon conversions of the rights once the units separate, and no cash will be payable in lieu thereof. As a result, a holder must
have 20 rights to receive one share of common stock at the closing of the initial business combination. In the event that any holder would
otherwise be entitled to any fractional share upon exchange of his, her or its rights, we will reserve the option, to the fullest extent
permitted by applicable law, to deal with any such fractional entitlement at the relevant time as we see fit, which would include the
rounding down of any entitlement to receive common stock to the nearest whole share (and in effect extinguishing any fractional entitlement),
or the holder being entitled to hold any remaining fractional entitlement (without any share being issued) and to aggregate the same with
any future fractional entitlement to receive shares in the company until the holder is entitled to receive a whole number. Any rounding
down and extinguishment may be done with or without any in lieu cash payment or other compensation being made to the holder of the relevant
rights, such that value received on exchange of the rights may be considered less than the value that the holder would otherwise expect
to receive. All holders of rights shall be treated in the same manner with respect to the issuance of shares upon conversions of the rights.

 

We have agreed that, subject
to applicable law, any action, proceeding or claim against us arising out of or relating in any way to the rights agreement will be brought
and enforced in the courts of the State of New York or the United States District Court for the Southern District of New York, and we
irrevocably submit to such jurisdiction, which jurisdiction will be the exclusive forum for any such action, proceeding or claim. See
“Risk Factors — Each of our warrant agreement and rights agreement will designate the courts of the State of New York or the
United States District Court for the Southern District of New York as the sole and exclusive forum for certain types of actions and proceedings
that may be initiated by holders of our warrants and holders of our rights, which could limit the ability of warrant holders and rights
holders to obtain a favorable judicial forum for disputes with our company.” This provision applies to claims under the Securities
Act but does not apply to claims under the Exchange Act or any claim for which the federal district courts of the United
States of America are the sole and exclusive forum.

 

Dividends

 

We have not paid any cash dividends
on our shares of common stock to date, and do not intend to pay cash dividends prior to the completion of a business combination. The
payment of cash dividends in the future will be dependent upon our revenues and earnings, if any, capital requirements and general financial
condition subsequent to completion of a business combination. The payment of any dividends subsequent to a business combination will be
within the discretion of our then board of directors. It is the present intention of our board of directors to retain all earnings, if
any, for use in our business operations and, accordingly, our board does not anticipate declaring any dividends in the foreseeable future.

 

Our Transfer Agent, Rights and Warrant Agent

 

The transfer agent for our
shares of common stock, rights agent for our rights and warrant agent for our warrants is Continental Stock Transfer & Trust
Company, 1 State Street, 30th Floor, New York, New York 10004.

 

Certain Anti-Takeover Provisions of Delaware
Law and our Certificate of Incorporation and Bylaws

 

We have opted out of Section 203
of the Delaware General Corporate Law, or the DGCL. However, our amended and restated certificate of incorporation contains similar provisions
providing that we may not engage in certain “business combinations” with any “interested stockholder” for a three-year period
following the time that the stockholder became an interested stockholder, unless:

 

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

 

		•	upon consummation of the transaction that resulted in the stockholder
becoming an interested stockholder, the interested stockholder owned at least 85% of our voting stock outstanding at the time the transaction
commenced, excluding certain shares; or

 

		•	at or subsequent to that time, the business combination is approved
by our board of directors and by the affirmative vote of holders of at least 662/3% of the outstanding voting stock that is not owned
by the interested stockholder.

 

    6

     

    

 

Generally, a “business
combination” includes a merger, asset or stock sale or certain other transactions resulting in a financial benefit to the interested
stockholder. Subject to certain exceptions, an “interested stockholder” is a person who, together with that person’s
affiliates and associates, owns, or within the previous three years owned, 20% or more of our voting stock.

 

Under certain circumstances,
this provision will make it more difficult for a person who would be an “interested stockholder” to effect various business
combinations with a corporation for a three-year period. This provision may encourage companies interested in acquiring our company
to negotiate in advance with our board of directors because the stockholder approval requirement would be avoided if our board of directors
approves either the business combination or the transaction which results in the stockholder becoming an interested stockholder. These
provisions also may have the effect of preventing changes in our board of directors and may make it more difficult to accomplish transactions
which stockholders may otherwise deem to be in their best interests.

 

Our amended and restated certificate
of incorporation provides that our co-sponsors and their respective affiliates, any of their respective direct or indirect transferees
of at least 20% of our outstanding common stock and any group as to which such persons are party to, do not constitute “interested
stockholders” for purposes of this provision.

 

Special meeting of stockholders

 

Our bylaws provide that special
meetings of our stockholders may be called only by a majority vote of our board of directors, by our chief executive officer or by our
chairman.

 

Advance notice requirements for stockholder
proposals and director nominations

 

Our bylaws provide that stockholders
seeking to bring business before our annual meeting of stockholders, or to nominate candidates for election as directors at our annual
meeting of stockholders must provide timely notice of their intent in writing. To be timely, a stockholder’s notice will need to
be delivered to our principal executive offices not later than the close of business on the 90th day nor earlier than
the opening of business on the 120th day prior to the scheduled date of the annual meeting of stockholders. Our bylaws
also specify certain requirements as to the form and content of a stockholders’ meeting. These provisions may preclude our stockholders
from bringing matters before our annual meeting of stockholders or from making nominations for directors at our annual meeting of stockholders.

 

Authorized but unissued shares

 

Our authorized but unissued
common stock and preferred stock are available for future issuances without stockholder approval, and could be utilized for a variety
of corporate purposes, including future offerings to raise additional capital, acquisitions and employee benefit plans. The existence
of authorized but unissued and unreserved common stock and preferred stock could render more difficult or discourage an attempt to obtain
control of us by means of a proxy contest, tender offer, merger or otherwise.

 

Exclusive forum for certain lawsuits

 

Our amended and restated certificate
of incorporation provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State
of Delaware shall be the sole and exclusive forum for any (1) derivative action or proceeding brought on behalf of our company, (2) action
asserting a claim of breach of a fiduciary duty owed by any director, officer, employee or agent of our company to our company or our
stockholders, (3) action asserting a claim arising pursuant to any provision of the DGCL or our amended and restated certificate
of incorporation or our bylaws, or (4) action asserting a claim governed by the internal affairs doctrine, in each case subject to
the Court of Chancery having personal jurisdiction over the indispensable parties named as defendants therein. Notwithstanding the foregoing,
the inclusion of such provision in our amended and restated certificate of incorporation will not be deemed to be a waiver of our obligation
to comply with federal securities laws, rules and regulations, and the provisions of this paragraph will not apply to suits brought to
enforce any liability or duty created by the Exchange Act or any other claim for which the federal district courts of the United States
of America shall be the sole and exclusive forum. Although we believe this provision benefits us by providing increased consistency in
the application of Delaware law in the types of lawsuits to which it applies, the provision may have the effect of discouraging lawsuits
against our directors and officers. Furthermore, the enforceability of choice of forum provisions in other companies’ certificates
of incorporation has been challenged in legal proceedings, and it is possible that a court could find these types of provisions to be
inapplicable or unenforceable.

 

    7tomz_ex42.htm

EXHIBIT 4.2
  
 DESCRIPTION OF CAPITAL STOCK
  
 The following description of the material terms of the common stock and preferred stock of TOMI Environmental Solutions, Inc. (the “Company”) is not complete and is qualified in its entirety by reference to the Company’s amended and restated articles of incorporation and amended bylaws, which are attached as Exhibits 3.2, 3.3, 3.4 and 3.5, respectively, to this Annual Report on Form 10-K of which this exhibit is a part and are incorporated herein by reference.
  
 Authorized Capital Stock
  
 We are currently authorized to issue 250,000,000 shares of common stock, par value $0.01 per share, 1,000,000 shares of convertible $0.01 preferred A stock, par value $0.01 per share, and 4,000 shares of Series B preferred stock, with a stated value of $1,000 per share. As of February 25, 2022, we had approximately 16,811,513 shares of common stock outstanding, held by approximately 194 shareholders of record, although we believe there were approximately 5,350 beneficial owners of our common stock, and 63,750 shares of series A preferred stock outstanding held by one shareholder, and no shares of the series B preferred stock outstanding.
  
 Common Stock
  
 The holders of our common stock are entitled to one vote per share on all matters submitted to a vote of our shareholders. We have not provided for cumulative voting for the election of directors in our amended and restated articles of incorporation or amended bylaws. The holders of our common stock are entitled to receive ratably the dividends out of funds legally available if our board of directors, or Board, in its discretion, determines to issue dividends and then only at the times and in the amounts that our Board may determine. The common stock is not entitled to redemption rights, preemptive rights, conversion rights, and it is not subject to any sinking fund provisions. The outstanding shares of common stock are fully paid and non-assessable. The outstanding shares of common stock are not liable to further call or to assessment by us. If we become subject to a liquidation event, dissolution or winding-up, the assets legally available for distribution to our shareholders would be distributable ratably among the holders of the common stock and any participating preferred stock outstanding at that time, subject to prior satisfaction of all outstanding debt and liabilities and the preferential rights of and the payment of liquidation preferences, if any, on any outstanding shares of preferred stock. The rights, powers, preferences and privileges of holders of common stock are subordinate to, and may be adversely affected by, the rights of the holders of shares of the preferred stock and any series of preferred stock which may be designated and issued in the future. No shareholders hold any registration rights.
  
 	 
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 Preferred Stock
  
 The rights, preferences and privileges of preferred stock could include dividend rights, conversion rights, voting rights, redemption rights, liquidation preferences, the number of shares constituting any class or series and the designation of the class or series. Terms selected by our Board of Directors in the future could decrease the amount of earnings and assets available for distribution to holders of shares of common stock or adversely affect the rights and powers, including voting rights, of the holders of shares of common stock without any further vote or action by the stockholders. As a result, the rights of holders of our common stock will be subject to, and may be adversely affected by, the rights of the holders of the convertible $0.1 preferred A stock and Series B Preferred Stock or any other preferred stock that may be issued by us in the future, which could have the effect of decreasing the market price of our common stock.
  
 Series A Preferred Stock
  
 We are authorized to issue 1,000,000 shares of convertible $0.01 preferred A stock, par value $0.01 per share, of which 63,750 shares were outstanding as of February 25, 2022. Holders of Series A Preferred Stock are not entitled to receive dividends. Each share of Series A Preferred Stock is convertible into one share of common stock. 
  
 Series B Preferred Stock
  
 We are authorized to issue 4,000 shares of Series B Preferred Stock. Each share of Series B Preferred Stock is convertible into 200 shares of common stock and have a stated value per share of $1,000. The Series B Preferred Stock shall carry a cumulative dividend of 7.5% per annum and shall be senior in liquidation preference to the common stock and equal in liquidation preference to all other authorized class of preferred stock. The dividend is payable in-kind, at the election of the Company.
  
 Dividend Policy
  
 Our Board has never declared or paid any cash dividends, and our Board does not currently intend to pay any cash dividends for the foreseeable future. Our Board expects to retain future earnings, if any, to fund the development and growth of the Company’s business. Any future determination to pay dividends will be at the discretion of our Board and will depend upon, among other factors, the Company’s financial condition, operating results, current and anticipated cash needs, plans for expansion and other factors that our Board may deem relevant.
  
 Anti-Takeover Provisions of the Company’s Organizing Documents
  
 Our amended and restated articles of incorporation and our amended bylaws include a number of provisions that could deter takeovers or delay or prevent changes in control, as well as changes in our Board or management team, including the following:
  
 Authorized but Unissued Shares. The authorized but unissued shares of the common stock and preferred stock will be available for future issuance without shareholder approval, subject to applicable law and the rules of The Nasdaq Stock Market LLC. These additional shares may be used for a variety of corporate purposes, including future public offerings to raise additional capital, acquisitions, and employee benefit plans. The existence of authorized but unissued shares of common stock or preferred stock may enable our Board to render more difficult or to discourage an attempt to obtain control of us by means of a merger, tender offer, proxy contest or otherwise.
  
 	 
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 No Cumulative Voting. Our shareholders do not have the right to cumulate votes in the election of directors of our Board, therefore allowing the holders of a majority of the shares of common stock entitled to vote in any election of directors of our Board to elect all of the directors standing for election, if they should so choose.
  
 Shareholder Action; Special Meeting of Shareholders. Special meetings of our shareholders may be called only by a majority of our Board, thus prohibiting a shareholder from calling a special meeting, except that, pursuant to the Florida Business Corporation Act, or FBCA, § 607.072, shareholders holding 10% or more of the votes entitled to be cast may call a special meeting. These limitation might delay the ability of the Company’s shareholders to force consideration of a proposal.
  
 Each of the foregoing provisions may make it more difficult for our existing shareholders to replace our Board as well as for another party to obtain control of us by replacing our Board. Since our Board has the power to retain and discharge our officers, these provisions could also make it more difficult for existing shareholders or another party to effect a change in management.
  
 Anti-Takeover Provisions under Florida Law
  
 We are governed by two provisions of the FBCA, which may deter or frustrate takeovers of Florida corporations.
  
 The Florida Control Share Act (FBCA § 607.0902) generally provides that shares acquired in excess of certain specified thresholds, without first obtaining the approval of our Board, will not possess any voting rights unless such voting rights are approved by a majority of our disinterested shareholders.
  
 The Florida Affiliated Transactions Act (FBCA § 607.0901) requires that, subject to certain exceptions, any affiliated transaction with a shareholder that owns more than 15% of the voting shares of the corporation, referred to as an “interested shareholder,” receive the approval of either the corporation’s disinterested directors or a supermajority vote of disinterested shareholders, or, absent either such approval, that a statutory “fair price” be paid to the shareholders in the transaction. The shareholder vote requirement is in addition to any shareholder vote required under any other section of the FBCA or our amended and restated articles of incorporation.
  
 	 
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 Limitation of Liability and Indemnification
  
 Florida law also authorizes us to indemnify directors, officers, employees and agents under certain circumstances and to limit the personal liability of corporate directors for monetary damages, except that we may not indemnify a director or officer or advance expenses to a director or officer if a judgment or other final adjudication establishes that his or her actions were material to the cause of action so adjudicated and constitute: (a) willful or intentional misconduct or a conscious disregard for the best interests of the corporation in a proceeding by or in right of the corporation to procure a judgment in its favor or in a proceeding by or in the right of a shareholder, (b) a transaction in which the director or officer derived an improper personal benefit, (c) a violation of the criminal law, unless the director or officer had reasonable cause to believe his or her conduct was lawful or had no reasonable cause to believe his or her conduct was unlawful, or (d) in the case of a director, a circumstance under which the director would be liable under the FBCA for an unlawful distribution. Our amended bylaws do not provide for the indemnification of our current and former directors and officers, thus the only right of indemnification that our current and former directors and officers have is a right of indemnification should such director or officer succeed against a claim brought against them because they were a director or officer as set out under FBCA § 607.0852. We have obtained a directors’ and officers’ liability insurance policy covering its current and former directors and officers.
  
 Listing
  
 Our common stock is listed on The Nasdaq Capital Market under the symbol “TOMZ.”
  
 Transfer Agent and Registrar
  
 The transfer agent and registrar for our common stock is Continental Stock Transfer & Trust Company.
  
 	 
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