Document:

EX-10.6

 Exhibit 10.6 

BRYN MAWR BANK CORPORATION 

RESTRICTED STOCK UNITS AGREEMENT 

(INDUCEMENT GRANT FOR NEW EMPLOYEES) 
  

			
	Grantee:	  	                                    
                                         
                                         
                                         
                     
		
	Date of Grant:	  	                                    
                                         
                                         
                                         
                     
		
	Number of RSUs:	  	                                    
                                         
                                         
                                         
                     
		
	End of Vesting Period:	  	
                          
       for                      of the RSUs

                          
       for                      of the RSUs

                          
       for                      of the RSUs

 RESTRICTED STOCK UNITS AGREEMENT (“Agreement”), dated as of the Date of Grant set forth
above, by and between BRYN MAWR BANK CORPORATION (the “Corporation”) and the Grantee named above (the “Grantee”). 

1. Inducement Award. The grant of Restricted Stock Units (“RSUs”) pursuant to this Agreement is intended to qualify as an
“inducement award” within the meaning of Nasdaq Listing Rule 5635(c) (4), and shall be interpreted to conform thereto, and is not made under the Bryn Mawr Bank Corporation 2010 Long Term Incentive Plan (the “Plan”) as approved by
the Board of Directors of the Corporation on February 26, 2010 and by the Corporation’s shareholders on April 28, 2010. However, with the exception of the restriction period provisions of Section 6.1 of the Plan, this Agreement
and the RSUs granted hereunder shall be subject to the terms of the Plan as if they had been awarded under the Plan. Except as otherwise specified herein, all capitalized terms used in this Agreement shall have the meanings given to them in the
Plan. The term “Corporation” as used in this Agreement with reference to employment shall include employment with any Subsidiary of the Corporation. 

2. Grant of Restricted Stock Units. 

a. Subject to the terms and conditions of the Plan and this Agreement, and the Grantee’s acceptance of same by execution of this
Agreement, the Corporation’s Compensation Committee (“Compensation Committee”) hereby grants to the Grantee the number of Restricted Stock Units set forth above (the “RSUs”). 

b. Upon vesting of the RSUs and satisfaction of all of the other terms and conditions in this Agreement, the Corporation will issue stock
representing the shares underlying the vested RSUs to be issued to Grantee as soon as practicable. 
 3. Terms and Conditions. The
Grant is subject to the following terms and conditions: 
 a. Restricted (Vesting) Period. Vesting of the RSUs is subject to the
completion of continued service by Grantee (i) with respect to                     of the RSUs, from the date of this Agreement through
                    , (ii) with respect to another
                    of the RSUs, from the date of this Agreement through
                    , and (iii) with respect to the last
                    of the RSUs, from the date of this Agreement through
                    (“Vesting Dates”) (each of the periods set forth in clauses (i), (ii) and (iii) is, as to the corresponding
portion of the RSUs, a “Vesting Period,” and all Vesting Periods collectively are the “Restricted Period”). 
 RSUs will vest upon
expiration of the applicable Vesting Period if but only if the Grantee remains continuously employed by the Corporation through the end of that Vesting Period or as otherwise provided herein. 

 b. No Rights as a Shareholder. Prior to the Vesting Dates, Grantee will have none of the
rights and privileges of a shareholder with respect to the shares underlying the RSUs, including but not limited to, the right to vote the shares. 

c. Dividend-Equivalents. At the time of issuance of shares underlying RSUs pursuant to subsection 2(b) above, the Corporation shall
also pay to Grantee an amount equal to the aggregate amount of all dividends declared and paid by the Corporation based on dividend record dates falling between
                and the date of issuance in accordance with the number of shares issued. The dividend-equivalents will be reported to the employee as W-2 wages and, as
such, will be subject to statutory withholding requirements for federal, state and local taxes. 
 4. Forfeiture. 

a. Forfeiture. All RSUs that have not vested at the respective Vesting Dates in accordance with subsections 2(a) and 2(b) shall be
forfeited in their entirety. 
 b. Forfeiture of Unvested RSUs and Payment to the Corporation for Issued Shares Resulting from Vested
RSUs If Grantee Engages in Certain Activities. The provisions of this subsection 4(b) will apply to all RSUs granted to Grantee hereunder and to any shares issued to the Grantee upon vesting of RSUs. If, at any time during the Restricted Period,
or (ii) two (2) years after termination of, or leaving Grantee’s employment with the Corporation, Grantee engages in any activity inimical, contrary or harmful to the interests of the Corporation including, but not limited to
(A) conduct related to Grantee’s employment for which either criminal or civil penalties against Grantee may be brought, (B) violation of the Corporation’s policies including, without limitation, the Corporation’s insider
trading policy, (C) soliciting of any customer of the Corporation for business which would result in such customer terminating their relationship with the Corporation; soliciting or inducing any individual who is an employee or director of the
Corporation to leave the Corporation or otherwise terminate their relationship with the Corporation, (D) disclosing or using any confidential information or material concerning the Corporation, or (E) participating in a hostile takeover
attempt, then (x) all RSUs that have not vested effective as of the date on which Grantee engages in such activity, unless forfeited sooner by operation of another term or condition of this Agreement or the Plan, shall be forfeited in their
entirety, and (y) for any shares underlying vested RSUs which have been issued to Grantee, the Grantee shall pay to the Corporation the market value of the shares on the date of issuance or the date Grantee engages in such activity, whichever
is greater. The term “confidential information” as used in this Agreement includes, but is not limited to, records, lists, and knowledge of the Corporation’s clients, methods of operation, processes, trade secrets, methods of
determination of prices, prices or fees, financial condition, profits, sales, net income, and indebtedness, as the same may exist from time to time. 

c. Right of Setoff. By accepting this Agreement, Grantee consents to the deduction, to the extent permitted by law, from any amounts
that the Corporation owes Grantee from time to time (including amounts owed to Grantee as wages or other compensation, fringe benefits, or paid time-off pay, as well as any other amounts owed to Grantee by the Corporation), the amounts Grantee owes
the Corporation under subsection 4(b) above. Whether or not the Corporation elects to make any setoff in whole or in part, if the Corporation does not recover by means of setoff the full amount Grantee owes it, calculated as set forth above, Grantee
agrees to immediately pay the unpaid balance to the Corporation. 
 d. Compensation Committee Discretion. Grantee may be released
from Grantee’s obligations under subsections 4(b) and 4(c) only if the Compensation Committee, or its duly appointed agent, determines in its sole discretion that such action is in the best interest of the Corporation. 

5. Death, Disability or Retirement. In the event the Grantee shall cease to provide service to the Corporation by reason of:
(a) normal or late retirement; (b) with the consent of the Compensation Committee, early retirement or a transfer of the Grantee in a spinoff; (c) death; or (d) total and permanent disability as determined by the Compensation
Committee, a fraction of Grantee’s RSUs, to the extent not already vested, will be deemed to have vested. The numerator of such fraction with respect to the RSUs shall be the number of full calendar months that have elapsed in the Restricted
Period prior to the death, disability or retirement of the Grantee and the denominator shall be the total number of months in the Restricted Period. Any remaining RSUs which have not vested as provided in this section 5 shall be forfeited. The terms
of subsection 2(b) shall apply to the RSUs which vest as provided in this section 5. 

 6. Termination. If the Grantee terminates the Grantee’s employment with the
Corporation or if the Corporation terminates the Grantee’s employment with or without Cause, other than as described in section 5 above, any RSUs that have not yet vested at the date of termination shall automatically be forfeited. 

7. Change of Control. In the event of a Change of Control, a fraction of Grantee’s outstanding RSUs, to the extent not already
vested, will be deemed to have vested and any shares underlying such RSUs not previously issued shall be issued within ten days after the Change of Control. The numerator of such fraction shall be the number of months that have elapsed in the
Restricted Period prior to the Change in Control and the denominator shall be the total number of months in the Restricted Period. Any remaining RSUs which have not vested as provided in this section 7 shall be forfeited. 

8. Change Adjustments. The Compensation Committee shall make appropriate adjustments to give effect to adjustments made in the number
of shares of the Corporation’s common stock through a merger, consolidation, recapitalization, reclassification, combination, spinoff, common stock dividend, stock split or other relevant change as the Compensation Committee deems appropriate
to prevent dilution or enlargement of the rights of the Grantee. Any adjustments or substitutions pursuant to this section shall meet the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and
shall be final and binding upon the Grantee. 
 9. Compliance with Law and Regulations. The grant of RSUs and the issuance of shares
underlying vested RSUs shall be subject to all applicable federal and state laws, the rules and regulations and to such approvals by any government or regulatory agency as may be required. The Corporation shall not be required to register any
securities pursuant to the Securities Act of 1933, as amended, or to list such shares under the stock market or exchange on which the common stock of the Corporation may then be listed, or to take any other affirmative action in order to cause the
issuance or delivery of shares underlying vested RSUs to comply with any law or regulation of any governmental authority. 
 10.
Notice. Any notice which either party hereto may be required or permitted to give to the other shall be in writing, and may be delivered personally or by mail, postage prepaid, addressed as follows: to the Corporation, Attention: Corporate
Secretary, at its office at 801 Lancaster Avenue, Bryn Mawr, PA 19010 or to the Grantee at her/his address on the records of the Corporation, or at such other addresses as the Corporation, or Grantee, may designate in writing from time to time to
the other party hereto. 
 11. Employment. Neither the action of the Corporation or the shareholders, nor any action taken by the
Compensation Committee under the Plan nor any provisions of this Agreement shall be construed as giving to the Grantee the right to be retained as an employee of the Corporation. 

12. Payment of Taxes. Upon issuance of shares underlying the vested RSUs, the fair value of the shares issued, calculated based on the
closing price of the Corporation’s common stock on the day preceding the issuance, will constitute W-2 wages to the Grantee and, as such, will be subject to statutory federal, state and local tax withholding taxes. The Corporation will withhold
a sufficient number of whole shares in order to satisfy this tax obligation. The remaining shares will be made available to the Grantee as soon as practicable. The value of any fractional shares will be paid to the Grantee through a separate
disbursement. 
 13. Incorporation by Reference. Except as set forth in section 1 hereof, the RSUs granted hereunder are subject to
the terms and conditions of the Plan, the provisions of which are incorporated herein by reference. With the exception of the restriction period provisions of Section 6.1 of the Plan, if any provision of this Agreement conflicts with any
provision of the Plan in effect on the Date of Grant, the terms of the Plan shall control. This Agreement shall not be modified after the Date of Grant except by written agreement between the Corporation and the Grantee; provided, however, that such
modification shall (a) not be inconsistent with the Plan, and (b) be approved by the Committee. 
 14. Severability. If any
one or more of the provisions contained in this Agreement are invalid, illegal or unenforceable, the other provisions of this Agreement will be construed and enforced as if the invalid, illegal or unenforceable provision had never been included.

 15. Compliance with Internal Revenue Code Section 409A. It is the intention of the parties that the RSUs and the Agreement
comply with the provisions of Section 409A of the Code to the extent, if any, that such 

 
provisions are applicable to the Agreement and the Agreement will be administered by the Compensation Committee in a manner consistent with this intent. If any payments or benefits may be subject
to taxation under Section 409A of the Code, Grantee agrees that the Compensation Committee may, without the consent of Grantee, modify this Agreement to the extent and in the manner that the Compensation Committee deems necessary or advisable
or take any other action or actions, including an amendment or action with retroactive effect that the Compensation Committee determines is necessary or appropriate to exempt any payments or benefits from the application of Section 409A or to
provide such payments or benefits in the manner that complies with the provisions of Section 409A such that they will not be taxable thereunder. 

16. Choice of Law. The provisions of this Agreement shall be construed in accordance with the laws of the Commonwealth of Pennsylvania,
without regard to any conflict of law provision that would apply the law of another jurisdiction. 
 17. Interpretation. The
interpretation and construction or any terms or conditions of the Plan or this Agreement by the Compensation Committee shall be final and conclusive. 

IN WITNESS WHEREOF, the Corporation has caused this Agreement to be executed by a duly authorized officer, and the Grantee has hereunto set
his/her hand and seal, effective as of the Date of Grant set forth above. 
  

			
	BRYN MAWR BANK CORPORATION
		
	By:	 	  

	Name: Geoffrey L. Halberstadt
	Title: Corporate Secretary
	
	  

	(Signature of Grantee)
	
	 Harry Madeira, Jr.

	(Print Name of Grantee)
	
	  

	(Address of Grantee)VAPOR
CORP.

 

BINDING
TERM SHEET FOR PROPOSED MERGER AND FINANCING TRANSACTIONS

 

This
binding term sheet (this “Term Sheet”) summarizes the principal terms of (a) a proposed merger transaction
(the “Merger”) between Vapor Corp., a Delaware corporation (“Vapor”), and Vaporin, Inc.,
a Delaware corporation (“Vaporin”), and (b) three related Financings (as defined herein) for Vapor. The Merger
and these Financings are sometimes collectively referred to herein as the “Transactions”. Vapor and Vaporin
are each sometimes referred to as a “Party” and collectively as the “Parties”.

 

	Structure
    of the Merger; Surviving Corporation	 	Vapor
    and Vaporin would consummate a statutory merger in accordance with the laws of the state of incorporation of each corporation.
    Vapor would be the surviving corporation in the Merger. 
	 	 	 
	Merger
    Consideration	 	Upon
    the consummation of the Merger, the shareholders of Vaporin will receive shares of the common stock of Vapor sufficient to
    give Vaporin shareholders ownership of a percentage of the total outstanding capital stock of Vapor equal to 45.0% of the
    combined company, subject to adjustment based on the Fairness Opinions (as defined herein). 
	 	 	 
	Fairness
    Opinions	 	The
    consummation of the Merger shall be conditioned on, among other things, the receipt by each of Vapor and Vaporin of an independent
    fairness opinion (each, a “Fairness Opinion”) issued by a separate independent investment bank which provides
    a favorable opinion regarding the financial terms and conditions of the Merger. These investment bankers shall be chosen by
    Vapor and Vaporin, respectively, and the interpretation of the results of each Fairness Opinion shall be determined by the
    Party that engaged the respective investment banker in that Party’s sole discretion. Each Party shall be responsible
    for all of the fees and expenses incurred in connection with the preparation of a Fairness Opinion.

 

    	 

    	 

    

  

	Registration
    Statement	 	The
    Parties anticipate that a Registration Statement (the “Registration Statement”) on Form S-4 will be required
    in connection with the Merger. Each Party shall cooperate with and shall promptly perform all actions and provide all information
    and documents to the other Party as required or desired by such other Party in connection with the preparation, filing, and
    effectiveness of this Registration Statement. The consummation of the Merger would be conditioned on this Registration Statement
    being declared effective by the Securities and Exchange Commission and no stop orders from any regulatory authority being
    in place. 
	 	 	 
	Financing
    Transactions	 	Subject
    to the limitations contained in this Section, the following amounts of financing will be made available to Vapor:

 

	 	 	●	A
    bridge financing (the “Bridge Financing”) of $1,000,000 to be funded by Michael Brauser and Barry Honig
    (or their affiliates) within five (5) days after the execution of this Term Sheet on the terms described on the Financing
    Term Sheet included as Exhibit A.
	 	 	 	 
	 	 	●	A
    total of $3,500,000 (the “Closing Financing”) to be funded contemporaneously with the consummation of the
    Merger. This Closing Financing will consist of common stock (with 100% warrant coverage) at a share price (“Per Share
    Price”) equal to the lesser of: (i) 80% of Vapor’s Volume Weighted Average Price (“VWAP”) on the five
    trading days after the announcement of Vapor’s preliminary third quarter results or (ii) 80% of Vapor’s VWAP on
    the five trading days prior to the closing of the Merger (beginning with the day prior to the Merger closing). The warrants
    will be exercisable at 125% of the Per Share Price, have cashless exercise rights and will be exercisable for a five year
    period. The holders of the common stock and warrants will have full-ratchet rights. Messrs. Brauser and Honig (or their affiliates)
    will lead the Closing Financing. The funds for the Closing Financing will be placed into an escrow account with an escrow
    agent satisfactory to all parties at least ten (10) days prior to the closing date of the Merger, and such funds will be released
    to Vapor at the same time as the consummation of the Merger.

 

    	 

    	 

    

  

	 	 	● 	A
    total of $20,000,000 to $25,000,000 (the “Subsequent Financing”) to be funded after the consummation of
    the Merger. This investment shall be made pursuant to a disbursement schedule and shall be subject to Vapor’s compliance
    with certain financial covenants and restrictions and Vapor’s achievement of certain performance-based metrics. This
    disbursement schedule, these financial covenants and restrictions, and these performance-based metrics will be negotiated
    and finalized prior to the consummation of the Merger and will be reflected in an agreement (“Financing Agreement”)
    which will be executed contemporaneously with the signing of the definitive Merger Agreement. The Financing Agreement for
    the Subsequent Financing will provide that certain Vaporin stockholders will be subject to certain penalties if the Subsequent
    Financing is not consistent with the terms of the Financing Agreement. These penalties could include the return of some of
    the shares of Vapor common stock received in the Merger.
	 	 	 	 
	 	 	●	The
    terms and conditions of the Subsequent Financing, including the share purchase price and any other economic terms, shall be
    no less favorable to Vapor than the equivalent terms and conditions of the Bridge Financing and/or the Closing Financing (whichever
    is more favorable to investors). 
	 	 	 	 
	 	 	●	In
    partial consideration of the role of Messrs. Brauser and Honig in the successful consummation of the Bridge and Closing Financings,
    one or more of them shall have the right to collectively appoint a total of two members of Vapor’s Board of Directors;
    provided, however, that all such appointees shall be reasonably acceptable to Vapor. Vapor’s Board of Directors shall
    consist of a total of five members. If in the future the Board of directors is increased, such party or parties shall have
    the right to appoint one less than a majority of the number of directors. Vapor agrees to nominate the designees at its next
    annual meeting of stockholders and recommend to its stockholders the election of such designees at any subsequent stockholders’
    meetings at which directors are elected through December 31, 2015. If any aspect of the Subsequent Financing does not occur
    for any reason other than Vapor’s failure to comply with the financial covenants or restrictions or the performance-based
    metrics or Vapor choosing not to proceed with a Subsequent Financing for any reason, this right to appoint Vapor Board of
    Directors members shall immediately terminate in all respects.
	 	 	 	 
	 	 	●	The
    Bridge Financing, the Closing Financing, and the Subsequent Financing are collectively referred to herein as the “Financings”.
	 	 	 	 
	 	 	●	Any
    shares of Vapor stock issued in connection with any Financing shall be unregistered but shall be subject to standard “piggyback”
    registration rights.
	 	 	 	 
	 	 	●	As
    a condition to the purchase of any Vapor stock purchased or received in any of the Financings, the recipient of such stock
    shall enter into standard stockholder or voting agreements which shall be agreed to in form and substance by both Vaporin
    and Vapor at the time of executing the Merger Agreement. 
	 	 	 	 
	 	 	●	The
    decision to accept the terms and conditions of and to proceed with the Subsequent Financing shall be in Vapor’s sole
    discretion.

 

    	 

    	 

    

 

	Transaction
    Documents	 	The
        proposed Merger will be completed in accordance with terms and conditions to be set forth in a definitive merger agreement
        (the “Merger Agreement”) which shall be mutually satisfactory in form and substance and all of which
        shall include closing conditions, representations and warranties, and covenants of the parties customary in transactions
        of this type. The definitive Merger Agreement shall be signed within forty-five (45) days after the execution of this
        Term Sheet by both parties. If this definitive Merger Agreement is not signed by all parties by the end of this forty-five
        (45) day period, then either party may terminate this Term Sheet by written notice to the other party and not be obligated
        to proceed with the Merger. Without limiting the generality of the foregoing, the Merger Agreement would provide for the
        following:

         

        (i)
        Representations and Warranties. The Merger Agreement shall contain standard parallel representations and warranties
        of the Parties, including, without limitation, due authorization, capitalization, corporate power, ownership of intellectual
        property, no brokers, and taxation.

         

        (ii)
        Conditions to Closing. The Merger Agreement shall contain standard conditions to closing, including, without limitation,
        the execution of a Financing Agreement for the Subsequent Financing, the receipt of all required stockholder votes (including
        any “majority of the minority” vote if applicable), the effectiveness of the Registration Statement, the presence
        of no stop orders, the consummation of the Closing Financing contemporaneously with the consummation of the Merger, the
        completion of due diligence investigations satisfactory to each party, and the receipt by both parties of all required
        regulatory approvals, including any required approvals from NASDAQ.

 

    	 

    	 

    

 

	Due
    Diligence Reviews	 	Each
    Party to the Merger shall promptly conduct a full due diligence review of the other Party, including, without limitation,
    business, legal, accounting, tax, and technology due diligence items. Any due diligence review conducted by Vaporin shall
    be coordinated through one designated representative. All due diligence reviews shall be completed within thirty (30) days
    after the execution of this Term Sheet by both Parties. 
	 	 	 
	Miscellaneous:	 	Confidentiality:
        Each of the Parties covenants and agrees that for a term beginning on the date of signing of this Term Sheet and ending
        on the second anniversary of such signing not to disclose the terms of this Term Sheet to any person other than the respective
        parties’ representatives and advisors who have a need to know, without the written consent of all of the other Parties.
        The Parties will enter into separate Confidentiality Agreements promptly after the execution of this Term Sheet.

         

        No
        Announcements: No Party shall make any public announcement of any kind (oral or written and including any press releases)
        regarding this Term Sheet or any of the components or provisions of the proposed Transactions discussed herein without
        the prior written consent of all Parties; provided, however, that any Party can take any actions required to comply with
        applicable laws and regulations.

         

        No
        Shop Provision: Until March 31, 2015, neither Vapor nor Vaporin shall enter into any discussions or negotiations of
        any kind (written or oral) with any entity or person other than the other Party, perform any actions of any kind that
        are inconsistent in any way with the matters discussed in this Term Sheet, or entertain, solicit, or consider any offers,
        terms, conditions, or provisions from any entity or person other than the Parties hereto regarding any transaction involving
        a sale of all or substantially all of the assets of the Parties, a merger, consolidation, or recapitalization of the Parties,
        or any similar transaction; provided, however, that if Vapor or Vaporin receives any communications from
        a third party about a merger, consolidation or sale of all or substantially all of its assets (any, an “Acquisition
        Proposal”) and it is advised by its counsel that its Board of Directors is required under the Delaware General
        Corporation Law to consider such Acquisition Proposal, it may consider such Acquisition Proposal and take actions in furtherance
        of it without breaching this No Shop provision. Vapor or Vaporin, as the case may be, shall promptly notify the other
        Party orally and in writing in the event that it receives any Acquisition Proposal or inquiry related thereto.
        Nothing contained herein shall preclude a party from complying with Rule
        14e-2 promulgated under the Securities Exchange Act of 1934.

         

        Expenses:
        Each Party to the Transactions will pay its own fees and expenses associated with the Transactions, including all legal
        and accounting fees and any fees and costs associated with its respective Fairness Opinion.

         

        Due
        Authorization for Execution. The execution of this Term Sheet on behalf of both Vapor and Vaporin has been duly authorized
        by all required corporate actions and procedures.

         

        No
        Hiring or Solicitation of Employees or Consultants. If the Transactions are not consummated for any reason, neither
        Vaporin nor Vapor shall, for a period ending on March 31, 2016 (the “Termination Date”), hire, engage as a
        consultant (directly or indirectly), or solicit for employment or engagement as a consultant (directly or indirectly)
        any employee or consultant of the other Party who is employed or engaged as a consultant by such other Party or who was
        employed or engaged as a consultant by such other Party at any time within the six months immediately preceding the date
        of the proposed hiring or engagement of such employee or consultant.

         

        Governing
        Law: This Term Sheet shall be interpreted and enforced under the laws of the State of Florida without giving effect
        to its conflicts of law principles.

         

        Counterparts:
        This Term Sheet may be executed in separate counterparts, and all such executed counterparts together shall be deemed
        to be fully effective and to be one and the same document.

 

[Signature
Page Follows]

 

    	 

    	 

    

 

IN
WITNESS WHEREOF, The undersigned parties have caused this Term Sheet for Proposed Merger and Financing Transactions to be
executed on November 6, 2014.

 

	 	VAPOR
    CORP.
	 	 	 
	 	By:	 /s/
    Jeffrey Holman
	 	Name:	Jeffrey Holman
	 	Title:	Chief Executive
    Officer
	 	 	 
	 	VAPORIN,
    INC.
	 	 	 
	 	By:	/s/
Greg Brauser
	 	Name:	Greg Brauser
	 	Title:	Chief Operating
    Officer

 

    	 

    	 

    

 

 

 

SUMMARY
OF TERMS

 

CONVERTIBLE
BRIDGE NOTE 

 

 

 

The
terms and conditions presented below do not constitute any form of binding contract but rather are solely for the purpose of outlining
those terms pursuant to which a definitive agreement may ultimately be entered into. This Term Sheet does not purport to summarize
all the terms, conditions, covenants, representations, warranties and other provisions which would be contained in the definitive
legal documentation for the financing contemplated herein. Closing is contingent upon completion of due diligence and final negotiation
and execution of satisfactory documentation containing customary closing conditions, representations, warranties, etc.

 

Dated:
November 5, 2014

 

 

	Company	Vapor
    Corp., a Delaware corporation (the “Company”)
	 	 
	Securities:	$1,000,000
    senior secured convertible notes (the “Notes”) and warrants (the “Warrants”) to
    purchase shares of the Company’s common stock (the “Common Stock”)
	 	 
	Investors:	Michael
    Brauser or his affiliates and Barry Honig or his affiliates (together, the “Investors”)
	 	 
	Closing
    Date:	Within
    5 Days of the execution of this Term Sheet 
	 	 
	Maturity
    Date	Unless
    earlier converted or redeemed, the Notes will mature on the one (1) year anniversary of the Closing Date (“Maturity
    Date”).
	 	 
	Interest	The
    Notes bear interest at a rate of 7% per annum, subject to increase to 15% per annum upon the occurrence and continuance
    of an event of default (as described below). Interest on the Notes is payable monthly in shares of Common Stock or cash, at
    the Company’s option. Interest on the Notes is computed on the basis of a 360-day year and twelve 30-day months and
    is payable in arrears monthly and is compounded monthly.
	 	 
	Conversion	The
    Notes shall be convertible into shares of Common Stock at a per share price of equal to the lesser of (i) $2.00, or (ii) 80%
    of the average VWAP over the three trading day period immediately prior to the Closing Date (the “Conversion Price”).
    
	 	 
	Warrants:	100%
    Warrant coverage. The Warrants will be exercisable on the issuance date through the fifth anniversary of the issuance date.
	 	 
	 	The
    Warrants will be exercisable at an initial exercise price equal to $2.75 per share. The exercise price of the Warrants
    is subject to adjustment for stock splits, stock dividends, combinations or similar events. .

 

    	 

    	 

    

 

	Placement
    Agent:	Palladium
    Capital Advisors LLC (“Palladium”) on a best efforts basis. Palladium shall be paid 5% of the gross proceeds from
    the sale of the Note payable on the Closing Date. In addition, Palladium shall receive a warrant on equivalent terms to the
    Warrants in an amount equal to 5% of the shares sold or issuable upon conversion of the Notes. 
	 	 
	Legal
    Fees:	The
    Company shall be responsible for all legal fees of outside counsel and disbursements up to $25,000. 
	 	 
	Binding
    Effect:	This
    Term Sheet is intended to be binding on the parties, including the Investors, of their mutual intent on proceeding with a
    financing transaction pursuant to a definitive agreement and related transaction documents prior to the Closing Date. The
    financing shall be completed in accordance with terms and conditions set forth in the Note transaction documents, all of which
    shall be mutually satisfactory in form and substance and all of which shall include representations and warranties and covenants
    of the parties customary in transactions of this this type. 
	 	 
	Effect
    of Termination	In
    the event that, following the execution and delivery of the final transaction documents, the Company or the Investors (the
    “Defaulting Party”) terminates the transaction not in accordance with the terms set forth herein, the Defaulting
    Party shall be obliged to pay all of the non-terminating party’s actual deal related expenses. 
	 	 
	Counterparts	This
    term sheet may be executed in any number of counterparts and by facsimile or email transmission, each of which shall be deemed
    to be an original instrument, but all of which taken together shall constitute one and the same agreement. Facsimile or email
    signatures shall be deemed to be original signatures for all purposes.

 

    	 

    	 

    

 

	Accepted
    and Acknowledged 	 
	 	 
	VAPOR
    CORP. 	 
	 	 
	By:	/s/
    Jeffrey Holman	 
	Name: 	Jeffrey Holman 	 
	Title:	CEO	 
	 	 	 
	PALLADIUM
    CAPITAL ADVISORS LLC	 
	 	 	 
	By:	/s/
    Joel Padowitz	 
	Name: 	Joel Padowitz	 
	Title: 	CEO 	 

 

BY
THE INVESTORS:

 

	MICHAEL
    BRAUSER	 
	 	 	 
	By:	/s/
    Michael Brauser	 
	 	 	 
	BARRY
    HONIG	 
	 	 	 
	By:	/s/
    Barry Honig	 

 

	This
    Term Sheet is intended to be a binding obligation of the Investors and the Company only. The failure of any party to consummate
    a transaction shall not represent a breach of any obligation by the Placement Agent or its representatives.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00237-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00237-of-00352.parquet"}]]