Exhibit 10.2


 


REGISTRATION RIGHTS AGREEMENT


 


REGISTRATION RIGHTS AGREEMENT
(this "Agreement"), dated as of May 1, 2015, by and among Ener-Core, Inc., a Nevada corporation, with headquarters
located at 9400 Toledo Way, Irvine, California 92618 (the "Company"), and the investors identified in their respective
“Buyer Signature Page” attached hereto (each, a "Buyer" and collectively, the "Buyers").


 


WHEREAS:


 


A.         In connection with
the Securities Purchase Agreement by and among the parties hereto of even date herewith (the "Securities Purchase Agreement"),
the Company has agreed, upon the terms and subject to the conditions of the Securities Purchase Agreement, to issue and sell to
each Buyer shares of the Company's common stock, par value $0.0001 per share (the "Common Stock") (the shares
of Common Stock issuable pursuant to the terms of the Securities Purchase Agreement, collectively, the "Common Shares").


 


B.         In accordance with
the terms of the Securities Purchase Agreement, the Company has agreed to provide certain registration rights under the Securities
Act of 1933, as amended, and the rules and regulations thereunder, or any similar successor statute (collectively, the "1933
Act"), and applicable state securities laws.


 


NOW, THEREFORE, in
consideration of the premises and the mutual covenants contained herein and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Company and each of the Buyers hereby agree as follows:


 


1.          Definitions.


 


Capitalized terms used herein
and not otherwise defined herein shall have the respective meanings set forth in the Securities Purchase Agreement. As used in
this Agreement, the following terms shall have the following meanings:


 


(a)          "Business
Day" means any day other than Saturday, Sunday or any other day on which commercial banks in the City of New York are
authorized or required by law to remain closed.


 


(b)          "Closing
Date" shall have the meaning set forth in the Securities Purchase Agreement.


 


(c)          "Effective
Date" means the date on which a Registration Statement, through which Registrable Securities shall be registered, has
been declared effective by the SEC.


 



    	 



    	 



    

 


(d)          "Eligible
Market" means the Principal Market, The New York Stock Exchange, Inc., the NYSE MKT LLC, The NASDAQ Capital Market, The
NASDAQ Global Select Market or The Nasdaq Global Market.


 


(e)          "Investor"
means a Buyer or any transferee or assignee thereof to whom a Buyer assigns its rights under this Agreement and who agrees to become
bound by the provisions of this Agreement in accordance with Section 9 and any transferee or assignee thereof to whom a
transferee or assignee assigns its rights under this Agreement and who agrees to become bound by the provisions of this Agreement
in accordance with Section 9.


 


(f)          "Permitted
Registrable Shares" means with respect to Registration Statements for resales pursuant to Rule 415 a number of Registrable
Securities equal to the least of (i) the number of Registrable Securities not then covered by an effective Registration Statement
that is available for resales pursuant to Rule 415, (ii) the number of Registrable Securities requested to be included in the Registration
Statement for a Proposed Registration, and (iii) the maximum number of Registrable Securities the Company is permitted to include
in such Registration Statement by the SEC, provided that the Company shall have used diligent efforts to advocate with the SEC
for the registration of all of the Registrable Securities required or requested to be included in the Registration Statement (considering
in good faith the input of the Investors and Legal Counsel (as defined below)), in accordance with applicable SEC guidance.


 


(g)          "Person"
means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization
and a government or any department or agency thereof.


 


(h)          "Principal
Market" means The OTC QB.


 


(i)          "register,"
"registered," and "registration" refer to a registration effected by preparing and filing one
or more Registration Statements (as defined below) in compliance with the 1933 Act and pursuant to Rule 415, and the declaration
or ordering of effectiveness of such Registration Statement(s) by the SEC.


 


(j)          "Registrable
Securities" means (i) the Common Shares issued pursuant to the terms of the Securities Purchase Agreement, and (ii) any
capital stock of the Company issued or issuable with respect to the Common Shares as a result of any stock split, stock dividend,
recapitalization, exchange or similar event or otherwise.


 


(k)          "Registration
Statement" means a registration statement or registration statements of the Company filed under the 1933 Act covering
Registrable Securities.


 


(l)          "Required
Holders" means holders of at least a majority of the Registrable Securities.


 


(m)        "Rule
415" means Rule 415 promulgated under the 1933 Act or any successor rule providing for offering
securities on a continuous or delayed basis.


 



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(n)          "SEC"
means the United States Securities and Exchange Commission.


 


(o)          "Trading
Day" means any day on which the Common Stock is traded on the Principal Market, or, if the Principal Market is not the
principal trading market for the Common Stock, then on the principal securities exchange or securities market on which the Common
Stock is then traded; provided that "Trading Day" shall not include any day on which the Common Stock is scheduled to
trade on such exchange or market for less than 4.5 hours or any day that the Common Stock is suspended from trading during the
final hour of trading on such exchange or market (or if such exchange or market does not designate in advance the closing time
of trading on such exchange or market, then during the hour ending at 4:00:00 p.m., New York time).


 


2.          Piggyback Registration
Rights.


 


(a)          If
at any time after the Closing Date, the Company proposes to register any of its Common Stock under the 1933 Act (a “Proposed
Registration”) (other than (i) in connection with registrations on Form S-4 or Form S-8
promulgated by the SEC or similar or successor forms, or (ii) a registration on any form that does not include substantially the
same information as would be required to be included in a registration statement covering the sale of Registrable Securities) and
the registration form to be used may be used for the registration of Registrable Securities, the Company shall promptly give written
notice (the “Piggyback Notice”) of such Proposed Registration to each of the
Investors (which notice shall be given not less than thirty (30) days prior to the expected effective date of the Company’s
registration statement, and in any event within five (5) Business Days after its receipt of notice of any exercise of demand registration
rights) and shall offer each Investor the right to include any of their Registrable Securities in the Proposed Registration; provided,
however, that if the Proposed Registration is for an offering pursuant to Rule 415, the Company shall only be required to include
the Permitted Registrable Shares.


 


(b)          Each Investor shall
have twenty (20) days from the date of receipt of the Piggyback Notice to deliver to the Company a written request specifying the
number of Registrable Securities such Investor intends to sell and such Investor’s intended method of disposition. Any Investor
shall have the right to withdraw such Investor’s request for inclusion of such Investor’s Registrable Securities in
any registration statement pursuant to this Section 2 by giving written notice to the Company of such withdrawal.  Subject
to Section 2(c) and Section 2(d) below, the Company shall include in such registration statement all such Registrable
Securities so requested to be included therein.


 



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(c)           If the Proposed
Registration includes an underwritten primary public offering on behalf of the Company and the managing underwriter or underwriters
of the Proposed Registration advises the Company that the total number of shares of Common Stock (including Registrable Securities)
that the Investors and any other Persons intend to include in the offering exceeds the number that can be sold in such offering
without being likely to have a material adverse effect on the price, timing or distribution of the Common Stock offered or the
market for the Common Stock, then the Common Stock to be included in such underwritten primary public offering shall include the
number of securities of the Company that such managing underwriter or underwriters advises the Company in writing can be sold without
having such material adverse effect, with such number to be allocated (i) first, to the securities that the Company proposes
to sell, (ii) second, to the Registrable Securities requested to be included in such registration by the Investors, pro
rata among the Investors on the basis of the number of shares of Registrable Securities owned by the Investors, with further
successive pro rata allocations among the Investors, if any such Investor has requested the registration of less than all of the
Registrable Securities that such Investor is entitled to register, and (iii) third, to any other securities requested to
be included in such registration.


 


(d)          If the Proposed
Registration is an underwritten public offering on behalf of holders of the Company’s securities and the managing underwriter
or underwriters of the Proposed Registration advises the Company that the total number of shares of Common Stock (including Registrable
Securities) that the Investors and any other Persons intend to include in the offering exceeds the number that can be sold in such
offering without being likely to have a material adverse effect on the price, timing or distribution of the Common Stock offered
or the market for the Common Stock, then the Common Stock to be included in such underwritten public offering shall include the
number of securities of the Company that such managing underwriter or underwriters advises the Company in writing can be sold without
having such material adverse effect, with such number to be allocated (i) first, to the securities requested to be included
therein by the holders requesting such registration and to the Registrable Securities requested to be included in such registration
by the Investors, pro rata among the holders of such securities and the Investors, on the basis of the number of shares
of Common Stock owned by such holders and the number of Registrable Securities owned by the Investors, with further successive
pro rata allocations among such holders and the Investors, if any such holder or Investor has requested the registration of less
than all of the shares of Common Stock or Registrable Securities that such holder or Investor, as applicable, is entitled to register,
and (ii) second, to any other securities requested to be included in such registration.


 


(e)          If the Proposed
Registration is for an offering pursuant to Rule 415 and the number of Registrable Securities requested by the Investors to be
included therein exceeds the number of Permitted Registrable Shares, the initial number of Registrable Securities included in
any Registration Statement in respect of such Proposed Registration and each increase in the number of Registrable Securities
included therein shall be allocated pro rata among the Investors holding Registrable Securities on the basis of the number
of Registrable Securities owned by such Investors, with further successive pro rata allocations among the Investors if
any such Investor has requested the registration of less than all of the Registrable Securities such Investor is entitled to register.
In the event that an Investor sells or otherwise transfers any of such Investor’s Registrable Securities, each transferee
shall be allocated a pro rata portion of the then remaining number of Registrable Securities included in such Registration
Statement for such transferor. Any shares of Common Stock included in such Registration Statement that remain allocated to any
Person that ceases to hold any Registrable Securities covered by such Registration Statement shall be allocated to the remaining
Investors, pro rata based on the number of Registrable Securities then held by such Buyers that are covered by such Registration
Statement.


 



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(f)          Subject to Section
5 hereof, the Required Holders shall have the right to select one legal counsel to review and oversee any registration pursuant
to this Section 2 ("Legal Counsel"), which shall be designated by the Required Holders. The Company and
Legal Counsel shall reasonably cooperate with each other in performing the Company's obligations under this Agreement.


 


(g)          Notwithstanding
anything to the contrary contained herein, if for any reason the SEC asserts or proposes a limitation on the securities to be included
in any Registration Statement filed pursuant to this Section 2 in which the Registrable Securities are to be included, the
Company shall use diligent efforts to advocate with the SEC for the registration of all of the securities required or requested
to be included in such Registration Statement (considering in good faith the input of the Investors and Legal Counsel), in accordance
with applicable SEC guidance.


 


3.          Related
Obligations.


 


At such time as the Company
is obligated to file a Registration Statement with the SEC pursuant to Section 2, the Company will use its best efforts
to effect the registration of the Registrable Securities in accordance with the intended method of disposition thereof and, pursuant
thereto, the Company shall have the following obligations:


 


(a)          The Company shall
promptly prepare and file with the SEC a Registration Statement with respect to the Registrable Securities and use its best efforts
to cause such Registration Statement relating to the Registrable Securities to become effective as soon as practicable after such
filing. The Company shall keep each Registration Statement effective pursuant to Rule 415 at all times until the earlier of (i)
the date as of which the Investors may sell all of the Registrable Securities covered by such Registration Statement without restriction
or limitation pursuant to Rule 144 and without the requirement to be in compliance with Rule 144(c)(1) (or any successor thereto)
promulgated under the 1933 Act, or (ii) the date on which the Investors shall have sold all of the Registrable Securities covered
by such Registration Statement (the "Registration Period"). Each Investor shall provide written notice to the
Company of the occurrence of either of the events described in clauses (i) and (ii) of the immediately preceding sentence with
respect to such Investor’s Registrable Securities promptly after the occurrence of such event.  The Company shall ensure
that each Registration Statement (including any amendments or supplements thereto and prospectuses contained therein) shall not
contain any untrue statement of a material fact or omit to state a material fact required to be stated therein, or necessary to
make the statements therein (in the case of prospectuses, in the light of the circumstances in which they were made) not misleading..


 


(b)          The Company shall
prepare and file with the SEC such amendments (including post-effective amendments) and supplements to a Registration Statement
and the prospectus used in connection with such Registration Statement, which prospectus is to be filed pursuant to Rule 424 promulgated
under the 1933 Act, as may be necessary to keep such Registration Statement effective at all times during the Registration Period,
and, during such period, comply with the provisions of the 1933 Act with respect to the disposition of all Registrable Securities
of the Company covered by such Registration Statement until such time as all of such Registrable Securities shall have been disposed
of in accordance with the intended methods of disposition by the seller or sellers thereof as set forth in such Registration Statement.
In the case of amendments and supplements to a Registration Statement which are required to be filed pursuant to this Agreement
(including pursuant to this Section 3(b)) by reason of the Company filing a report on Form 10-K, Form 10-Q, Form 8-K or
any analogous report under the Securities Exchange Act of 1934, as amended (the "1934 Act"), the Company shall
have incorporated such report by reference into such Registration Statement, if applicable, or shall file such amendments or supplements
with the SEC as expeditiously as practicable on or following the date on which the 1934 Act report is filed which created the requirement
for the Company to amend or supplement such Registration Statement.


 



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(c)          The Company shall
(A) permit Legal Counsel to review and comment upon (i) a Registration Statement at least five (5) Business Days prior to its filing
with the SEC and (ii) all amendments and supplements to all Registration Statements (except for Annual Reports on Form 10-K, Quarterly
Reports on Form 10-Q, Current Reports on Form 8-K, and any similar or successor reports) within a reasonable number of days prior
to their filing with the SEC, and (B) not file any Registration Statement or amendment or supplement thereto in a form to which
Legal Counsel reasonably objects. The Company shall not submit a request for acceleration of the effectiveness of a Registration
Statement or any amendment or supplement thereto without the prior approval of Legal Counsel, which consent shall not be unreasonably
withheld. The Company shall furnish to Legal Counsel, without charge, (i) copies of any correspondence from the SEC or the staff
of the SEC to the Company or its representatives relating to any Registration Statement, (ii) promptly after the same is prepared
and filed with the SEC, one copy of any Registration Statement and any amendment(s) thereto, including financial statements and
schedules, all documents incorporated therein by reference, if requested by an Investor, and all exhibits and (iii) upon the effectiveness
of any Registration Statement, one copy of the prospectus included in such Registration Statement and all amendments and supplements
thereto. The Company shall reasonably cooperate with Legal Counsel in performing the Company's obligations pursuant to this Section
3.


 


(d)          The Company shall
furnish to each Investor whose Registrable Securities are included in any Registration Statement, without charge, (i) promptly
after the same is prepared and filed with the SEC, if requested by an Investor and not otherwise available on EDGAR (or any successor)
system, at least one copy of such Registration Statement and any amendment(s) thereto, including financial statements and schedules,
all documents incorporated therein by reference, all exhibits and each preliminary prospectus, (ii) upon the effectiveness of any
Registration Statement, ten (10) copies of the prospectus included in such Registration Statement and all amendments and supplements
thereto (or such other number of copies as such Investor may reasonably request) and (iii) such other documents, including copies
of any preliminary or final prospectus, as such Investor may reasonably request from time to time in order to facilitate the disposition
of the Registrable Securities owned by such Investor.


 



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(e)          The Company shall
use its best efforts to (i) register and qualify, unless an exemption from registration and qualification applies, the resale by
Investors of the Registrable Securities covered by a Registration Statement under such other securities or "blue sky"
laws of all applicable jurisdictions in the United States, (ii) prepare and file in those jurisdictions such amendments (including
post-effective amendments) and supplements to such registrations and qualifications as may be necessary to maintain the effectiveness
thereof during the Registration Period, (iii) take such other actions as may be necessary to maintain such registrations and qualifications
in effect at all times during the Registration Period, and (iv) take all other actions reasonably necessary or advisable to qualify
the Registrable Securities for sale in such jurisdictions; provided, however, that the Company shall not be required
in connection therewith or as a condition thereto to (x) qualify to do business in any jurisdiction where it would not otherwise
be required to qualify but for this Section 3(e), (y) subject itself to general taxation in any such jurisdiction, or (z)
file a general consent to service of process in any such jurisdiction. The Company shall promptly notify Legal Counsel and each
Investor who holds Registrable Securities of the receipt by the Company of any notification with respect to the suspension of the
registration or qualification of any of the Registrable Securities for sale under the securities or "blue sky" laws of
any jurisdiction in the United States or its receipt of actual notice of the initiation or threatening of any proceeding for such
purpose.


 


(f)          The Company shall
notify Legal Counsel and each Investor in writing of the happening of any event, as promptly as practicable after becoming aware
of such event, as a result of which the prospectus included in a Registration Statement, as then in effect, includes an untrue
statement of a material fact or omission to state a material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not misleading (provided that in no event shall such notice
contain any material, nonpublic information), and, subject to Section 3(r), promptly prepare a supplement or amendment to
such Registration Statement to correct such untrue statement or omission, and deliver ten (10) copies of such supplement or amendment
to Legal Counsel and each Investor (or such other number of copies as Legal Counsel or such Investor may reasonably request). The
Company shall also promptly notify Legal Counsel and each Investor in writing (i) when a prospectus or any prospectus supplement
or post-effective amendment has been filed, and when a Registration Statement or any post-effective amendment has become effective
(notification of such effectiveness shall be delivered to Legal Counsel and each Investor by facsimile or email on the same day
of such effectiveness and by overnight mail), (ii) of any request by the SEC for amendments or supplements to a Registration Statement
or related prospectus or related information, and (iii) of the Company's reasonable determination that a post-effective amendment
to a Registration Statement would be appropriate. By 9:30 a.m. New York City time on the date following the date any post-effective
amendment has become effective, the Company shall file with the SEC in accordance with Rule 424 under the 1933 Act the final prospectus
to be used in connection with sales pursuant to such Registration Statement.


 


(g)          The Company shall
use its best efforts to prevent the issuance of any stop order or other suspension of effectiveness of a Registration Statement,
or the suspension of the qualification of any of the Registrable Securities for sale in any jurisdiction and, if such an order
or suspension is issued, to obtain the withdrawal of such order or suspension at the earliest possible moment and to notify Legal
Counsel and each Investor who holds Registrable Securities being sold of the issuance of such order and the resolution thereof
or its receipt of actual notice of the initiation or threat of any proceeding for such purpose.


 


(h)          If any Investor
is required under applicable securities laws to be described in the Registration Statement as an underwriter or an Investor believes
that it could reasonably be deemed to be an underwriter of Registrable Securities, at the reasonable request of such Investor,
the Company shall furnish to such Investor, on the date of the effectiveness of the Registration Statement and thereafter from
time to time on such dates as an Investor may reasonably request (i) a letter, dated such date, from the Company's independent
certified public accountants in form and substance as is customarily given by independent certified public accountants to underwriters
in an underwritten public offering, addressed to the Investors, and (ii) an opinion, dated as of such date, of counsel representing
the Company for purposes of such Registration Statement, in form, scope and substance as is customarily given in an underwritten
public offering, addressed to the Investors.


 



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(i)          If any Investor
is required under applicable securities laws to be described in the Registration Statement as an underwriter or an Investor believes
that it could reasonably be deemed to be an underwriter of Registrable Securities, the Company shall make available for inspection
by (i) such Investor, (ii) Legal Counsel and (iii) one firm of accountants or other agents retained by the Investors (collectively,
the "Inspectors"), all pertinent financial and other records, and pertinent corporate documents and properties
of the Company (collectively, the "Records"), as shall be reasonably deemed necessary by each Inspector, and cause
the Company's officers, directors and employees to supply all information which any Inspector may reasonably request; provided,
however, that each Inspector shall agree in writing to hold in strict confidence and shall not make any disclosure (except
to an Investor) or use of any Record or other information which the Company determines in good faith to be confidential, and of
which determination the Inspectors are so notified, unless (a) the disclosure of such Records is necessary to avoid or correct
a misstatement or omission in any Registration Statement or is otherwise required under the 1933 Act, (b) the release of such Records
is ordered pursuant to a final, non-appealable subpoena or order from a court or government body of competent jurisdiction, or
(c) the information in such Records has been made generally available to the public other than by disclosure in violation of this
Agreement. Each Investor agrees that it shall, upon learning that disclosure of such Records is sought in or by a court or governmental
body of competent jurisdiction or through other means, give prompt written notice to the Company and allow the Company, at its
expense, to undertake appropriate action to prevent disclosure of, or to obtain a protective order for, the Records deemed confidential.
Nothing herein (or in any other confidentiality agreement between the Company and any Investor) shall be deemed to limit the Investors'
ability to sell Registrable Securities in a manner which is otherwise consistent with applicable laws and regulations.


 


(j)          The Company shall
hold in confidence and not make any disclosure of information concerning an Investor provided to the Company unless (i) disclosure
of such information is necessary to comply with federal or state securities laws, (ii) the disclosure of such information is necessary
to avoid or correct a misstatement or omission in any Registration Statement, (iii) the release of such information is ordered
pursuant to a subpoena or other final, non-appealable order from a court or governmental body of competent jurisdiction, or (iv)
such information has been made generally available to the public other than by disclosure in violation of this Agreement or any
other Transaction Document. The Company agrees that it shall, upon learning that disclosure of such information concerning an Investor
is sought in or by a court or governmental body of competent jurisdiction or through other means, give prompt written notice to
such Investor and allow such Investor, at the Investor's expense, to undertake appropriate action to prevent disclosure of, or
to obtain a protective order for, such information.


 



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(k)          The Company shall
use its best efforts either to (i) cause all of the Registrable Securities covered by a Registration Statement to be listed on
each securities exchange on which securities of the same class or series issued by the Company are then listed, if any, if the
listing of such Registrable Securities is then permitted under the rules of such exchange or (ii) secure the inclusion for quotation
of all of the Registrable Securities on The Principal Market or (iii) if, despite the Company's best efforts, the Company is unsuccessful
in satisfying the preceding clauses (i) and (ii), to secure the inclusion for quotation on another Eligible Market for such Registrable
Securities and, without limiting the generality of the foregoing, to use its best efforts to arrange for at least two market makers
to register with the Financial Industry Regulatory Authority, Inc. ("FINRA") as such with respect to such Registrable
Securities. The Company shall pay all fees and expenses in connection with satisfying its obligation under this Section 3(k).


 


(l)          The Company shall
cooperate with the Investors who hold Registrable Securities being offered and, to the extent applicable, facilitate the timely
preparation and delivery of certificates (not bearing any restrictive legend) representing the Registrable Securities to be offered
pursuant to a Registration Statement and enable such certificates to be in such denominations or amounts, as the case may be, as
the Investors may reasonably request and registered in such names as the Investors may request.


 


(m)        If requested by
an Investor, and if Company’s counsel reasonably deems such inclusion not inconsistent with the 1933 Act or the 1934 Act
or other applicable law, the Company shall as soon as practicable (i) incorporate in a prospectus supplement or post-effective
amendment such information as an Investor reasonably requests to be included therein relating to the sale and distribution of Registrable
Securities, including, without limitation, information with respect to the number of Registrable Securities being offered or sold,
the purchase price being paid therefor and any other terms of the offering of the Registrable Securities to be sold in such offering;
(ii) make all required filings of such prospectus supplement or post-effective amendment after being notified of the matters to
be incorporated in such prospectus supplement or post-effective amendment; and (iii) supplement or make amendments to any Registration
Statement if reasonably requested by an Investor holding any Registrable Securities.


 


(n)         The Company shall
use its best efforts to cause the Registrable Securities covered by a Registration Statement to be registered with or approved
by such other governmental agencies or authorities as may be necessary to consummate the disposition of such Registrable Securities.


 


(o)         The Company shall
make generally available to its security holders as soon as practical, but not later than ninety (90) days after the close of the
period covered thereby, an earnings statement (in form complying with, and in the manner provided by, the provisions of Rule 158
under the 1933 Act) covering a twelve-month period beginning not later than the first day of the Company's fiscal quarter next
following the applicable Effective Date of a Registration Statement.


 


(p)         The Company shall
otherwise use its best efforts to comply with all applicable rules and regulations of the SEC in connection with any registration
hereunder.


 



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(q)        Within two (2) Business
Days after a Registration Statement which covers Registrable Securities is ordered effective by the SEC, the Company shall deliver,
and shall cause legal counsel for the Company to deliver, to the transfer agent for such Registrable Securities (with copies to
the Investors whose Registrable Securities are included in such Registration Statement) confirmation that such Registration Statement
has been declared effective by the SEC in the form attached hereto as Exhibit A.


 


(r)          Notwithstanding
anything to the contrary herein, at any time after the Effective Date, the Company may delay the disclosure of material, non-public
information concerning the Company the disclosure of which at the time is not, in the good faith opinion of the Board of Directors
of the Company and its counsel, in the best interest of the Company and, in the opinion of counsel to the Company, otherwise required
(a "Grace Period"); provided, that the Company shall promptly (i) notify the Investors in writing of the existence
of material, non-public information giving rise to a Grace Period (provided that in each notice the Company will not disclose the
content of such material, non-public information to the Investors) and the date on which the Grace Period will begin, and (ii)
notify the Investors in writing of the date on which the Grace Period ends; and, provided further, that no Grace Period shall exceed
ten (10) consecutive Trading Days and during any three hundred sixty five (365) day period such Grace Periods shall not exceed
an aggregate of twenty (20) Trading Days and the first day of any Grace Period must be at least five (5) Trading Days after the
last day of any prior Grace Period (each, an "Allowable Grace Period"). For purposes of determining the length
of a Grace Period above, the Grace Period shall begin on and include the date the Investors receive the notice referred to in clause
(i) and shall end on and include the later of the date the Investors receive the notice referred to in clause (ii) and the date
referred to in such notice. The last sentence of Section 3(a), first sentence of Section 3(b), the first
sentence of Section 3(f) and the provisions of Sections 3(g) and 3(m) hereof shall not be applicable
during the period of any Allowable Grace Period. Upon expiration of the Grace Period, the Company shall again be bound by the last
sentence of Section 3(a), first sentence of Section 3(b), the first sentence of Section 3(f) and
the provisions of Sections 3(g) and 3(m) with respect to the information giving rise thereto unless such material,
non-public information is no longer applicable. Notwithstanding anything to the contrary, the Company shall cause its transfer
agent to deliver unlegended shares of Common Stock to a transferee of an Investor in accordance with the terms of the Securities
Purchase Agreement in connection with any sale of Registrable Securities with respect to which an Investor has entered into a contract
for sale, prior to the Investor's receipt of the notice of a Grace Period and for which the Investor has not yet settled.


 


(s)          Neither the Company
nor any Subsidiary or affiliate thereof shall identify any Investor as an underwriter in any public disclosure or filing with the
SEC, the Principal Market or any Eligible Market and any Buyer being deemed an underwriter by the SEC shall not relieve the Company
of any obligations it has under this Agreement or any other Transaction Document (as defined in the Securities Purchase Agreement);
provided, however, that the foregoing shall not prohibit the Company from including customary language in a "Plan
of Distribution" section attached to any Registration Statement through which the Registrable Securities shall be registered,
that such Investors may be deemed to be "underwriters" within the meaning of the 1933 Act.


 






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(t)          Neither the Company
nor any of its Subsidiaries has entered, as of the date hereof, nor shall the Company or any of its Subsidiaries, on or after the
date of this Agreement, enter into any agreement with respect to its securities, that would have the effect of impairing the rights
granted to the Buyers in this Agreement or otherwise conflicts with the provisions hereof.


 


4.          Obligations of the
Investors.


 


(a)          At least five (5)
Business Days prior to the first anticipated Filing Date of a Registration Statement, the Company shall notify each Investor in
writing of the information the Company requires from each such Investor if such Investor elects to have any of such Investor's
Registrable Securities included in such Registration Statement. It shall be a condition precedent to the obligations of the Company
to complete any registration pursuant to this Agreement with respect to the Registrable Securities of a particular Investor that
such Investor shall furnish to the Company such information regarding itself, the Registrable Securities held by it and the intended
method of disposition of the Registrable Securities held by it as shall be reasonably required to effect and maintain the effectiveness
of the registration of such Registrable Securities and shall execute such documents in connection with such registration as the
Company may reasonably request.


 


(b)          Each Investor, by
such Investor's acceptance of the Registrable Securities, agrees to cooperate with the Company as reasonably requested by the Company
in connection with the preparation and filing of any Registration Statement hereunder, unless such Investor has notified the Company
in writing of such Investor's election to exclude all of such Investor's Registrable Securities from such Registration Statement.


 


(c)          Each Investor agrees
that, upon receipt of any notice from the Company of the happening of any event of the kind described in Section 3(g) or
the first sentence of Section 3(f), such Investor will immediately discontinue disposition of Registrable Securities pursuant
to any Registration Statement(s) covering such Registrable Securities until such Investor's receipt of copies of the supplemented
or amended prospectus as contemplated by Section 3(g) or the first sentence of Section 3(f) or receipt of notice
that no supplement or amendment is required. Notwithstanding anything to the contrary, the Company shall cause its transfer agent
to deliver unlegended shares of Common Stock to a transferee of an Investor in accordance with the terms of the Securities Purchase
Agreement in connection with any sale of Registrable Securities with respect to which an Investor has entered into a contract for
sale prior to the Investor's receipt of a notice from the Company of the happening of any event of the kind described in Section
3(g) or the first sentence of Section 3(f) and for which the Investor has not yet settled.


 


(d)          Each Investor covenants
and agrees that it will comply with the prospectus delivery requirements of the 1933 Act as applicable to it or an exemption therefrom
in connection with sales of Registrable Securities pursuant to the Registration Statement.


 


(e)          Upon a request by
the Company, each Investor will, as soon as practicable, but in no event later than two (2) Business Days after such request, notify
the Company whether such Investor continues to hold Registrable Securities.


 



    	 11



    	 



    

 


(f)          No Investor may
participate in any registration hereunder which is underwritten unless such Investor (i) agrees to sell such Investor’s Registrable
Securities on the basis provided in any underwriting arrangements and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents required under the terms of such underwriting arrangements;
provided, that no holder of Registrable Securities included in any underwritten registration shall be required to make any representations
or warranties to the Company or the underwriters (other than representations and warranties regarding such holder, such holder's
ownership of its shares of Common Stock to be sold in the offering and such holder's intended method of distribution) or to undertake
any indemnification obligations to the Company or the underwriters with respect thereto, except as otherwise provided in Section
6.


 


5.          Expenses of Registration.


 


All reasonable expenses,
other than underwriting discounts and commissions or other charges of any broker-dealer acting on behalf of the Investors, incurred
in connection with registrations, filings or qualifications pursuant to Sections 2 and 3, including, without limitation,
all registration, listing and qualifications fees, printers and accounting fees, and fees and disbursements of counsel for the
Company shall be paid by the Company. The Company shall also reimburse the Investors for the reasonable fees and disbursements
of Legal Counsel in connection with registration, filing or qualification pursuant to Sections 2 and 3 of this Agreement
which amount shall be limited to $5,000 for each such registration, filing or qualification.


 


6.          Indemnification.


 


In the event any Registrable
Securities are included in a Registration Statement under this Agreement:


 


(a)          To the fullest extent
permitted by law, the Company will, and hereby does agree to indemnify, hold harmless and defend each Investor, the directors,
officers, partners, members, employees, agents, representatives of, and each Person, if any, who controls any Investor within the
meaning of the 1933 Act or the 1934 Act (each, an "Indemnified Person"), against any losses, claims, damages,
liabilities, judgments, fines, penalties, charges, costs, reasonable attorneys' fees, amounts paid in settlement or expenses, joint
or several (collectively, "Claims"), incurred in investigating, preparing or defending any action, claim, suit,
inquiry, proceeding, investigation or appeal taken from the foregoing by or before any court or governmental, administrative or
other regulatory agency, body or the SEC, whether pending or threatened, whether or not an indemnified party is or may be a party
thereto ("Indemnified Damages"), to which any of them may become subject insofar as such Claims (or actions or
proceedings, whether commenced or threatened, in respect thereof) or Indemnified Damages arise out of or are based upon: (i) any
untrue statement or alleged untrue statement of a material fact in a Registration Statement or any post-effective amendment thereto
or in any filing made in connection with the qualification of the offering under the securities or other "blue sky" laws
of any jurisdiction in which Registrable Securities are offered ("Blue Sky Filing"), or the omission or alleged
omission to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii)
any untrue statement or alleged untrue statement of a material fact contained in any preliminary prospectus if used prior to the
effective date of such Registration Statement, or contained in the final prospectus (as amended or supplemented, if the Company
files any amendment thereof or supplement thereto with the SEC) or the omission or alleged omission to state therein any material
fact necessary to make the statements made therein, in light of the circumstances under which the statements therein were made,
not misleading, (iii) any violation or alleged violation by the Company of the 1933 Act, the 1934 Act, any other law, including,
without limitation, any state securities law, or any rule or regulation thereunder relating to the offer or sale of the Registrable
Securities pursuant to a Registration Statement or (iv) any violation of this Agreement (the matters in the foregoing clauses (i)
through (iv) being, collectively, "Violations"). Subject to Section 6(c), the Company shall reimburse the
Indemnified Persons, promptly as such expenses are incurred and are due and payable, for any legal fees or other reasonable expenses
incurred by them in connection with investigating or defending any such Claim. Notwithstanding anything to the contrary contained
herein, the indemnification agreement contained in this Section 6(a): (x) shall not apply to a Claim or Indemnified Damages
sought by an Indemnified Person arising out of or based upon a Violation which occurs in reliance upon and in conformity with information
furnished in writing to the Company by such Indemnified Person for such Indemnified Person expressly for use in connection with
the preparation of the Registration Statement or any such amendment thereof or supplement thereto, if such prospectus was timely
made available by the Company pursuant to Section 3(d); and (y) shall not apply to amounts paid in settlement of any Claim
if such settlement is effected without the prior written consent of the Company, which consent shall not be unreasonably withheld
or delayed. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of the Indemnified
Person and shall survive the transfer of the Registrable Securities by the Investors pursuant to Section 9.


 






    	 12



    	 



    

 


(b)          In connection with
any Registration Statement in which an Investor is participating, each such Investor agrees to severally and not jointly indemnify,
hold harmless and defend, to the same extent and in the same manner as is set forth in Section 6(a), the Company, each of
its directors, each of its officers who signs the Registration Statement and each Person, if any, who controls the Company within
the meaning of the 1933 Act or the 1934 Act (each, an "Indemnified Party"), against any Claim or Indemnified Damages
to which any of them may become subject, under the 1933 Act, the 1934 Act or otherwise, insofar as such Claim or Indemnified Damages
arise out of or are based upon any Violation, in each case to the extent, and only to the extent, that such Violation occurs in
reliance upon and in conformity with written information furnished to the Company by such Investor expressly for use in connection
with such Registration Statement (or any amendment thereof or supplement thereto); and, subject to Section 6(c), such Investor
shall reimburse the Indemnified Party for any legal or other expenses reasonably incurred by an Indemnified Party in connection
with investigating or defending any such Claim; provided, however, that the indemnity agreement contained in this Section 6(b)
and the agreement with respect to contribution contained in Section 7 shall not apply to amounts paid in settlement of any
Claim or Indemnified Damages if such settlement is effected without the prior written consent of such Investor, which consent shall
not be unreasonably withheld or delayed; provided, further, however, that the Investor shall be liable under this Section 6(b)
for only that amount of a Claim or Indemnified Damages as does not exceed the net proceeds to such Investor as a result of the
sale of Registrable Securities pursuant to such Registration Statement giving rise to such indemnification obligation. Such indemnity
shall remain in full force and effect regardless of any investigation made by or on behalf of such Indemnified Party and shall
survive the transfer of the Registrable Securities by the Investors pursuant to Section 9.


 



    	 13



    	 



    

 


(c)          Promptly after receipt
by an Indemnified Person or Indemnified Party under this Section 6 of notice of the commencement of any action or proceeding
(including any governmental action or proceeding) involving a Claim or Indemnified Damages, such Indemnified Person or Indemnified
Party shall, if a Claim in respect thereof is to be made against any indemnifying party under this Section 6, deliver to
the indemnifying party a written notice of the commencement thereof, and the indemnifying party shall have the right to participate
in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume
control of the defense thereof with counsel mutually satisfactory to the indemnifying party and the Indemnified Person or the Indemnified
Party, as the case may be; provided, however, that an Indemnified Person or Indemnified Party shall have the right to retain its
own counsel with the fees and expenses of not more than one counsel for all such Indemnified Person or Indemnified Party to be
paid by the indemnifying party, if, in the reasonable opinion of counsel retained by the Indemnified Person or Indemnified Party,
as applicable, the representation by such counsel of the Indemnified Person or Indemnified Party and the indemnifying party would
be inappropriate due to actual or potential differing interests between such Indemnified Person or Indemnified Party and any other
party represented by such counsel in such proceeding. In the case of an Indemnified Person, legal counsel referred to in the immediately
preceding sentence shall be selected by the Investors holding at least a majority in interest of the Registrable Securities included
in the Registration Statement to which the Claim or Indemnified Damages relate. The Indemnified Party or Indemnified Person shall
reasonably cooperate with the indemnifying party in connection with any negotiation or defense of any such action or proceeding
or Claim or Indemnified Damages by the indemnifying party and shall furnish to the indemnifying party all information reasonably
available to the Indemnified Party or Indemnified Person which relates to such action or proceeding or Claim or Indemnified Damages.
The indemnifying party shall keep the Indemnified Party or Indemnified Person fully apprised at all times as to the status of the
defense or any settlement negotiations with respect thereto. No indemnifying party shall be liable for any settlement of any action,
claim or proceeding effected without its prior written consent, provided, however, that the indemnifying party shall not unreasonably
withhold, delay or condition its consent. No indemnifying party shall, without the prior written consent of the Indemnified Party
or Indemnified Person, consent to entry of any judgment or enter into any settlement or other compromise which does not include
as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party or Indemnified Person of a release
from all liability in respect to such Claim or litigation and such settlement shall not include any admission as to fault on the
part of the Indemnified Party. Following indemnification as provided for hereunder, the indemnifying party shall be subrogated
to all rights of the Indemnified Party or Indemnified Person with respect to all third parties, firms or corporations relating
to the matter for which indemnification has been made. The failure to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action or proceeding shall not relieve such indemnifying party of any liability
to the Indemnified Person or Indemnified Party under this Section 6, except to the extent that the indemnifying party is
prejudiced in its ability to defend such action or proceeding as a result of such failure.


 


(d)          The
indemnification required by this Section 6 shall be made by periodic payments of the amount thereof during the course of
the investigation or defense, as and when bills are received or Indemnified Damages are incurred.


 



    	 14



    	 



    

 


(e)          The indemnity agreements
contained herein shall be in addition to (i) any cause of action or similar right of the Indemnified Party or Indemnified Person
against the indemnifying party or others, and (ii) any liabilities the indemnifying party may be subject to pursuant to the law.


 


7.          Contribution.


 


To the extent any indemnification
by an indemnifying party is prohibited or limited by law, the indemnifying party agrees to make the maximum contribution with respect
to any amounts for which it would otherwise be liable under Section 6 to the fullest extent permitted by law; provided,
however, that: (i) no Person involved in the sale of Registrable Securities which Person is guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 1933 Act) in connection with such sale shall be entitled to contribution from any Person
involved in such sale of Registrable Securities who was not guilty of fraudulent misrepresentation; and (ii) contribution by any
seller of Registrable Securities shall be limited in amount to the amount of net proceeds received by such seller from the sale
of such Registrable Securities pursuant to such Registration Statement.


 


8.          Reports Under the
1934 Act.


 


With a view to making available
to the Investors the benefits of Rule 144 promulgated under the 1933 Act or any other similar rule or regulation of the SEC that
may at any time permit the Investors to sell securities of the Company to the public without registration ("Rule 144"),
the Company agrees to:


 


(a)          make and keep public
information available, as those terms are understood and defined in Rule 144;


 


(b)          file with the SEC
in a timely manner all reports and other documents required of the Company under the 1933 Act and the 1934 Act so long as the Company
remains subject to such requirements and the filing of such reports and other documents is required for the applicable provisions
of Rule 144;


 


(c)          furnish to each
Investor so long as such Investor owns Registrable Securities, promptly upon request, (i) a written statement by the Company, if
true, that it has complied with the reporting requirements of Rule 144, the 1933 Act and the 1934 Act, (ii) a copy of the most
recent annual or quarterly report of the Company and such other reports and documents so filed by the Company, and (iii) such other
information as may be reasonably requested to permit the Investors to sell such securities pursuant to Rule 144 without registration;
and


 



    	 15



    	 



    

 


(d)          promptly at the
request of each Investor, give the Company’s transfer agent instructions to the effect that, upon the transfer agent’s
receipt from any Investor of a certificate (a “Rule 144 Certificate”) certifying that such Investor’s
holding period (as determined in accordance with the provisions of Rule 144) for any portion of the Registrable Securities which
such Investor proposes to sell (the “Securities Being Sold”) is not less than six (6) months, and receipt by
the transfer agent of a “Rule 144 Opinion” (as hereinafter defined) from the Company or its counsel, the transfer agent
is to effect the transfer of the Securities Being Sold and issue to such transferee(s) thereof one or more stock certificates representing
the transferred Securities Being Sold without any restrictive legend and without recording any restrictions on the transferability
of such shares on the transfer agent’s books and records. In this regard, upon each Investor’s request, the Company
shall have an affirmative obligation to cause its counsel to promptly issue to the transfer agent a legal opinion providing that,
based on the Rule 144 Certificate, the Securities Being Sold were or may be sold, as applicable, pursuant to the provisions of
Rule 144, even in the absence of an effective registration statement (the “Rule 144 Opinion”). If the transfer
agent requires any additional documentation in connection with any proposed transfer by any Investor of any Securities Being Sold,
the Company shall promptly deliver or cause to be delivered to the transfer agent or to any other Person, all such additional documentation
as may be necessary to effectuate the transfer of the Securities Being Sold and the issuance of an unlegended certificate to any
transferee thereof, all at the Company’s expense.


 


9.          Assignment of Registration
Rights.


 


The rights under this Agreement
shall be automatically assignable by the Investors to any transferee of all or any portion of such Investor's Registrable Securities
if: (i) the Investor agrees in writing with the transferee or assignee to assign such rights, and a copy of such agreement is furnished
to the Company within a reasonable time after such assignment; (ii) the Company is, within a reasonable time after such transfer
or assignment, furnished with written notice of (a) the name and address of such transferee or assignee, and (b) the securities
with respect to which such registration rights are being transferred or assigned; (iii) immediately following such transfer or
assignment the further disposition of such securities by the transferee or assignee is restricted under the 1933 Act or applicable
state securities laws; (iv) at or before the time the Company receives the written notice contemplated by clause (ii) of this sentence
the transferee or assignee agrees in writing with the Company to be bound by all of the provisions contained herein; and (v) such
transfer shall have been made in accordance with the applicable requirements of the Securities Purchase Agreement.


 


10.         Amendment of Registration
Rights.


 


Provisions of this Agreement
may be amended and the observance thereof may be waived (either generally or in a particular instance and either retroactively
or prospectively), only with the written consent of the Company and the Required Holders; provided that any such amendment or waiver
that complies with the foregoing but that disproportionately, materially and adversely affects the rights and obligations of any
Investor relative to the comparable rights and obligations of the other Investors shall require the prior written consent of such
adversely affected Investor. Any amendment or waiver effected in accordance with this Section 10 shall be binding upon each
Investor and the Company. No such amendment shall be effective to the extent that it applies to less than all of the holders of
the Registrable Securities. No consideration shall be offered or paid to any Person to amend or consent to a waiver or modification
of any provision of this Agreement unless the same consideration (other than the reimbursement of legal fees) also is offered to
all of the parties to this Agreement.


 



    	 16



    	 



    

 


11.          Miscellaneous.


 


  (a)          A Person is deemed
to be a holder of Registrable Securities whenever such Person owns or is deemed to own of record such Registrable Securities. If
the Company receives conflicting instructions, notices or elections from two or more Persons with respect to the same Registrable
Securities, the Company shall act upon the basis of instructions, notice or election received from such record owner of such Registrable
Securities.


 


  (b)          Any notices, consents,
waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing and will
be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by facsimile (provided
confirmation of transmission is mechanically or electronically generated and kept on file by the sending party); (iii) when sent,
if sent by electronic mail; or (iv) one Business Day after deposit with a nationally recognized overnight delivery service, in
each case properly addressed to the party to receive the same. The addresses, facsimile numbers and email addresses for such communications
shall be:


 


If to the Company:


 








	 	Ener-Core, Inc.
	 	9400 Toledo Way
	 	Irvine, California 92618
	 	Telephone:	(949) 616-3322
	 	Facsimile:	(949) 616-3399
	 	Attention:	Domonic J. Carney
	 	Email:	DJ.Carney@ener-core.com









 


With a copy (for informational
purposes only) to:


 





	 	LKP Global Law, LLP
	 	1901 Avenue of the Stars, Suite 480
	 	Los Angeles, CA 90067
	 	Telephone:	(424) 239-1890
	 	Facsimile:	(424) 239-1882
	 	Attention:	Kevin Leung
	 	Email:	Kleung@lkpgl.com	 





 











 If to the Transfer Agent:




 


	 	VStock Transfer, LLC
	 	18 Lafayette Place
	 	Woodmere, New York 11598
	 	Telephone:	(212) 828-8436
	 	Facsimile: 	(646) 536-3179
	 	Attention: 	Yoel Goldfeder
	 	E-mail:	yoel@vstocktransfer.com












    	 17



    	 



    

 


If to a Buyer, to its address, facsimile number
and/or email address set forth on such Buyer’s “Buyer Signature Page,” or to such other address, facsimile number
and/or email address to the attention of such other Person as the recipient party has specified by written notice given to each
other party five (5) days prior to the effectiveness of such change. Written confirmation of receipt (A) given by the recipient
of such notice, consent, waiver or other communication, (B) mechanically or electronically generated by the sender's facsimile
machine or email containing the time, date, recipient facsimile number and an image of the first page of such transmission or (C)
provided by a courier or overnight courier service, shall be rebuttable evidence of personal service, receipt by facsimile, receipt
by email or receipt from a nationally recognized overnight delivery service in accordance with clause (i), (ii), (iii) or (iv)
above, respectively.


 


(c)          Failure of any party
to exercise any right or remedy under this Agreement or otherwise, or delay by a party in exercising such right or remedy, shall
not operate as a waiver thereof.


 


(d)          All questions concerning
the construction, validity, enforcement and interpretation of this Agreement shall be governed by the internal laws of the State
of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York
or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York.
Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City of New
York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated
hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an
inconvenient forum or that the venue of such suit, action or proceeding is improper. Each party hereby irrevocably waives personal
service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address for such notices to it under this Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process
in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY
TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION
CONTEMPLATED HEREBY.


 


(e)          If any provision
of this Agreement is prohibited by law or otherwise determined to be invalid or unenforceable by a court of competent jurisdiction,
the provision that would otherwise be prohibited, invalid or unenforceable shall be deemed amended to apply to the broadest extent
that it would be valid and enforceable, and the invalidity or unenforceability of such provision shall not affect the validity
of the remaining provisions of this Agreement so long as this Agreement as so modified continues to express, without material change,
the original intentions of the parties as to the subject matter hereof and the prohibited nature, invalidity or unenforceability
of the provision(s) in question does not substantially impair the respective expectations or reciprocal obligations of the parties
or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties will endeavor in good
faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s), the effect of which
comes as close as possible to that of the prohibited, invalid or unenforceable provision(s).


 



    	 18



    	 



    

 


(f)         This Agreement,
the other Transaction Documents (as defined in the Securities Purchase Agreement) and the instruments referenced herein and therein
constitute the entire agreement among the parties hereto with respect to the subject matter hereof and thereof. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to herein and therein. This Agreement, the other Transaction
Documents and the instruments referenced herein and therein supersede all prior agreements and understandings among the parties
hereto with respect to the subject matter hereof and thereof.


 


(g)         Subject to the requirements
of Section 9, this Agreement shall inure to the benefit of and be binding upon the permitted successors and assigns of each
of the parties hereto.


 


(h)         The headings in
this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.


 


(i)         This Agreement and
any amendments hereto may be executed and delivered in two or more counterparts, and by the different parties hereto in separate
counterparts, each of which when executed shall be deemed to be an original, but all of which taken together shall constitute one
and the same agreement, and shall become effective when counterparts have been signed by each party hereto and delivered to the
other parties hereto, it being understood that all parties need not sign the same counterpart.  In the event that any signature
to this Agreement or any amendment hereto is delivered by facsimile transmission or by e-mail delivery of a “.pdf”
format data file, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature
is executed) with the same force and effect as if such facsimile or “.pdf” signature page were an original thereof.
 No party hereto shall raise the use of a facsimile machine or e-mail delivery of a “.pdf” format data file to
deliver a signature to this Agreement or any amendment hereto or the fact that such signature was transmitted or communicated through
the use of a facsimile machine or e-mail delivery of a “.pdf” format data file as a defense to the formation or enforceability
of a contract and each party hereto forever waives any such defense.


 


(j)          Each party shall
do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other
agreements, certificates, instruments and documents, as any other party may reasonably request in order to carry out the intent
and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.


 


(k)        All consents and
other determinations required to be made by the Investors pursuant to this Agreement shall be made, unless otherwise specified
in this Agreement, by the Required Holders.


 






    	 19



    	 



    

  


(l)          The language used
in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent and no rules of strict
construction will be applied against any party.


 


(m)         This Agreement is
intended for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for the benefit
of, nor may any provision hereof be enforced by, any other Person.


 


(n)          The obligations
of each Investor hereunder are several and not joint with the obligations of any other Investor, and no provision of this Agreement
is intended to confer any obligations on any Investor vis-à-vis any other Investor. Nothing contained herein, and no action
taken by any Investor pursuant hereto, shall be deemed to constitute the Investors as a partnership, an association, a joint venture
or any other kind of entity, or create a presumption that the Investors are in any way acting in concert or as a group with respect
to such obligations or the transactions contemplated herein.


 


* * * * * *


[Signature Page Follows]


 



    	 20



    	 



    

  


IN WITNESS WHEREOF,
each Buyer and the Company have caused their respective signature page to this Registration Rights Agreement to be duly executed
as of the date first written above.


 


	 	COMPANY:



	 	 
	 	ENER-CORE, INC. 




	 	 	 
	 	By:	
	 	 	Name: Alain J. Castro
	 	 	Title: Chief Executive Officer


 


[Company Signature
Page To Registration Rights Agreement]


 



    	 21



    	 



    

 





IN WITNESS WHEREOF,
each Buyer and the Company have caused their respective signature page to this Registration Rights Agreement to be duly executed
as of the date first written above.


 


BUYER:


 


	INDIVIDUAL INVESTOR:	 	PARTNERSHIP, CORPORATION, TRUST, LIMITED LIABILITY
COMPANY, CUSTODIAL ACCOUNT, OR OTHER INVESTOR:





	 	 	 
	_______________________________________________	 	_______________________________________________
	(print name)	 	(print name of entity)



 


	_______________________________________________	 	By:	____________________________________________
	(signature)	 	 	(signature of person signing on

behalf of entity)




	 	 	 	 
	 	 	Name:_______________________________________
	 	 	 	 
	 	 	Title: _______________________________________

                                                        




 


	
         

        Address for Notice:

        ______________________________________

        ______________________________________

        ______________________________________

         

        Tel: _________________________________

         

        Fax:__________________________________

         

        Email:________________________________
	 	
         

        Address for Notice:

        ______________________________________

        ______________________________________

        _______________________________________

         

        Tel: ___________________________________

         

        Fax:___________________________________

         

        Email: ________________________________




 


[Buyer Signature Page To Registration Rights
Agreement]




 






    	 22



    	 



    

 


EXHIBIT A


 


FORM OF NOTICE OF EFFECTIVENESS

OF REGISTRATION STATEMENT


 


VStock Transfer, LLC


18 Lafayette Place


Woodmere, New York 11598


Attention:           Yoel Goldfeder


 


Re:        Ener-Core, Inc.


 


Ladies and Gentlemen:


 


[We are][I am] counsel
to Ener-Core, Inc., a Nevada corporation (the "Company"), and have represented the Company in connection with
that certain Securities Purchase Agreement, dated as of May 1, 2015 (the "Securities Purchase Agreement"),
entered into by and among the Company and the buyers named therein (collectively, the "Holders") pursuant to which
the Company issued to the Holders shares of the Company's common stock, par value $0.0001 per share (the "Common Stock")
(the shares of Common Stock issuable pursuant to the terms of the Securities Purchase Agreement, collectively, the "Common
Shares"). Pursuant to the Securities Purchase Agreement, the Company also has entered into a Registration Rights Agreement
with the Holders (the "Registration Rights Agreement") pursuant to which the Company agreed, among other things,
to register the resale of the Registrable Securities (as defined in the Registration Rights Agreement), including the Common Shares
issuable pursuant to the Securities Purchase Agreement under the Securities Act of 1933, as amended (the "1933 Act").
In connection with the Company's obligations under the Registration Rights Agreement, on ____________ ___, 201__, the Company filed
a Registration Statement on Form S-__ (File No. 333-_____________) (the "Registration Statement") with the Securities
and Exchange Commission (the "SEC") relating to the Registrable Securities which names each of the Holders as
a selling shareholder thereunder.


 


In connection with the
foregoing, [we][I] advise you that a member of the SEC's staff has advised [us][me] by telephone that the SEC has entered an order
declaring the Registration Statement effective under the 1933 Act at [ENTER TIME OF EFFECTIVENESS] on [ENTER
DATE OF EFFECTIVENESS] and [we][I] have no knowledge, after telephonic inquiry of a member of the SEC's staff, that any
stop order suspending its effectiveness has been issued or that any proceedings for that purpose are pending before, or threatened
by, the SEC and the Registrable Securities are available for resale under the 1933 Act pursuant to the Registration Statement.


 


This letter shall serve
as our standing instruction to you that the Common Shares are freely transferable by the Holders pursuant to the Registration Statement.
You need not require further letters from us to effect any future legend-free issuance or reissuance of Common Shares to the Holders
as contemplated by the Company's Irrevocable Transfer Agent Instructions dated May 1, 2015.


  


	 	Very truly yours,
	 	 	 
	 	[ISSUER'S COUNSEL]
	 	 	 
	 	By:	









 


CC:   [LIST NAMES OF HOLDERS]


 


 


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