Document:

FORM OF FORWARD PURCHASE CONTRACT

 

Terrapin 3 Acquisition Corporation

590 Madison
Avenue

New York, NY 10022

 

May [●], 2014

MIHI LLC

125 West 55th Street

New York, NY 10019

 

		Re:	Forward Purchase Contract

 

Ladies and Gentlemen:

 

We are pleased to accept
the offer MIHI, LLC (the “Subscriber” or “you”) has made to purchase an aggregate of 4,000,000
units (the “Units”) of Terrapin 3 Acquisition Corporation, a Delaware corporation (the “Company”),
each Unit comprising one share of Class A Common Stock of the Company, par value $0.0001 per share (“Class A Common
Stock” or “Class A Share”) and one warrant to purchase one-half of one Class A Share (“Warrant”)
and 1,000,000 shares of Class F Common Stock of the Company, par value $0.0001 per share (“Class F Common Stock”
or "Class F Share" and together with the Class A Common Stock and any common stock of the Company without
designation, “Common Stock” or “Share”) for a purchase price of $40,004,700.35. The Units,
Shares and Warrants, collectively, are hereinafter referred to as the “Securities”. Each Warrant is exercisable
to purchase one-half of one Class A Share at an exercise price of $5.75 per half Class A Share during the period commencing on
the later of (i) twelve (12) months from the date of the closing of the Company’s initial public offering of units each comprising
one share of Class A Common Stock and one Warrant (the “IPO”) and (ii) thirty (30) days following the consummation
of the Company’s initial business combination (the “Business Combination”) and expiring on the fifth anniversary
of the consummation of the Business Combination. Warrants must be exercised for one whole share of Class A Common Stock. For example,
if Subscriber holds two Warrants, such Warrants will be exercisable for one share of Class A Common Stock at a price of $11.50
per share. No fractional shares of Class A Common Stock will be issued upon exercise of the Warrants. If, upon exercise of
the Warrants, a holder would be entitled to receive a fractional interest in a Share, we will, upon exercise, round down to the
nearest whole number the number of shares of Class A Common Stock to be issued to the warrant holder. The terms (this “Agreement”)
on which the Company is willing to sell the Securities to the Subscriber, and the Company and the Subscriber’s agreements
regarding such Securities, are as follows:

 

1.           Purchase
of the Securities. For the sum of $40,004,700.35 (the “Purchase Price”), the Company agrees to sell the
Securities to the Subscriber, and the Subscriber hereby agrees to purchase the Securities from the Company, subject to the terms
and subject to the conditions set forth in this Agreement.

 

    	 

    	 

    

 

2.           Representations,
Warranties and Agreements.

 

2.1          Subscriber’s
Representations, Warranties and Agreements. To induce the Company to issue the Securities to the Subscriber, the Subscriber
hereby represents and warrants to the Company and agrees with the Company as follows:

 

2.1.1           No
Government Recommendation or Approval. The Subscriber understands that no federal or state agency has passed upon or made any
recommendation or endorsement of the offering of the Securities.

 

2.1.2           No
Conflicts. The execution, delivery and performance of this Agreement and the consummation by the Subscriber of the transactions
contemplated hereby do not violate, conflict with or constitute a default under (i) the formation and governing documents of the
Subscriber, (ii) any agreement, indenture or instrument to which the Subscriber is a party or (iii) any law, statute, rule or regulation
to which the Subscriber is subject, or any agreement, order, judgment or decree to which the Subscriber is subject.

 

2.1.3           Organization
and Authority. The Subscriber is a Delaware limited liability company, validly existing and in good standing under the laws
of Delaware and possesses all requisite power and authority necessary to carry out the transactions contemplated by this Agreement.
Upon execution and delivery by you, this Agreement is a legal, valid and binding agreement of Subscriber, enforceable against Subscriber
in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, fraudulent conveyance
or similar laws affecting the enforcement of creditors’ rights generally and subject to general principles of equity (regardless
of whether enforcement is sought in a proceeding at law or in equity).

 

2.1.4           Experience,
Financial Capability and Suitability. Subscriber is: (i) sophisticated in financial matters and is able to evaluate the risks
and benefits of the investment in the Securities and (ii) able to bear the economic risk of its investment in the Securities for
an indefinite period of time because the Securities have not been registered under the Securities Act (as defined below) and therefore
cannot be sold unless subsequently registered under the Securities Act or an exemption from such registration is available. Subscriber
is capable of evaluating the merits and risks of its investment in the Company and has the capacity to protect its own interests.
Subscriber must bear the economic risk of this investment until the Securities are sold pursuant to: (i) an effective registration
statement under the Securities Act or (ii) an exemption from registration available with respect to such sale. Subscriber is able
to bear the economic risks of an investment in the Securities and to afford a complete loss of Subscriber’s investment in
the Securities.

 

2.1.5           Access
to Information; Independent Investigation. Prior to the execution of this Agreement, the Subscriber has had the opportunity
to ask questions of and receive answers from representatives of the Company concerning an investment in the Company, as well as
the finances, operations, business and prospects of the Company, and the opportunity to obtain additional information to verify
the accuracy of all information so obtained. In determining whether to make this investment, Subscriber has relied solely on Subscriber’s
own knowledge and understanding of the Company and its business based upon Subscriber’s own due diligence investigation and
the information furnished pursuant to this paragraph. Subscriber understands that no person has been authorized to give any information
or to make any representations which were not furnished pursuant to this Section 2 and Subscriber has not relied on any other representations
or information in making its investment decision, whether written or oral, relating to the Company, its operations and/or its prospects.

 

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2.1.6           Regulation
D Offering. Subscriber represents that it is an “accredited investor” as such term is defined in Rule 501(a) of
Regulation D under the Securities Act of 1933, as amended (the “Securities Act”) and acknowledges the sale contemplated
hereby is being made in reliance on a private placement exemption to “accredited investors” within the meaning of Section
501(a) of Regulation D under the Securities Act or similar exemptions under state law.

 

2.1.7           Investment
Purposes. The Subscriber is purchasing the Securities solely for investment purposes, for the Subscriber’s own account
and not for the account or benefit of any other person, and not with a view towards the distribution or dissemination thereof.
The Subscriber did not decide to enter into this Agreement as a result of any general solicitation or general advertising within
the meaning of Rule 502 under the Securities Act.

 

2.1.8           Restrictions
on Transfer; Shell Company. Subscriber understands the Securities are being offered in a transaction not involving a public
offering within the meaning of the Securities Act. Subscriber understands the Securities will be “restricted securities”
within the meaning of Rule 144(a)(3) under the Securities Act and Subscriber understands that any certificates representing the
Securities will contain a legend in respect of such restrictions. If in the future the Subscriber decides to offer, resell, pledge
or otherwise transfer the Securities, such Securities may be offered, resold, pledged or otherwise transferred only pursuant to:
(i) registration under the Securities Act, or (ii) an available exemption from registration. Subscriber agrees that if any transfer
of its Securities or any interest therein is proposed to be made, as a condition precedent to any such transfer, Subscriber may
be required to deliver to the Company an opinion of counsel satisfactory to the Company. Absent registration or an exemption, the
Subscriber agrees not to resell the Securities. Subscriber further acknowledges that because the Company is a shell company, Rule
144 may not be available to the Subscriber for the resale of the Securities until one (1) year following consummation of the Business
Combination, despite technical compliance with the requirements of Rule 144 and the release or waiver of any contractual transfer
restrictions.

 

2.1.9           No
Governmental Consents. No governmental, administrative or other third party consents or approvals are required, necessary or
appropriate on the part of Subscriber in connection with the transactions contemplated by this Agreement, other than the filing
of a Form D with the Securities and Exchange Commission and such state Blue Sky, FINRA and NASDAQ consents and approvals as
may be required.

 

2.2         Company’s
Representations, Warranties and Agreements. To induce the Subscriber to purchase the Securities, the Company hereby represents
and warrants to the Subscriber and agrees with the Subscriber as follows:

 

2.2.1           Organization
and Corporate Power. The Company is a Delaware corporation and is qualified to do business in every jurisdiction in which the
failure to so qualify would reasonably be expected to have a material adverse effect on the financial condition, operating results
or assets of the Company. The Company possesses all requisite corporate power and authority necessary to carry out the transactions
contemplated by this Agreement.

 

2.2.2           No
Conflicts. The execution, delivery and performance of this Agreement and the consummation by the Company of the transactions
contemplated hereby do not violate, conflict with or constitute a default under (i) the Certificate of Incorporation or Bylaws
of the Company, (ii) any agreement, indenture or instrument to which the Company is a party or (iii) any law, statute, rule or
regulation to which the Company is subject, or any agreement, order, judgment or decree to which the Company is subject.

 

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2.2.3           Title
to Securities. Upon issuance in accordance with, and payment pursuant to, the terms hereof, the Securities will be duly and
validly issued, fully paid and non-assessable. Upon issuance in accordance with, and payment pursuant to, the terms hereof the
Subscriber will have or receive good title to the Securities, free and clear of all liens, claims and encumbrances of any kind,
other than (a) transfer restrictions under federal and state securities laws, and (b) liens, claims or encumbrances imposed due
to the actions of the Subscriber. The Company will reserve sufficient Shares to permit full exercise of the Warrants and conversions
of the Class F Common Stock.

 

2.2.4           No
Adverse Actions. There are no actions, suits, investigations or proceedings pending, threatened against or affecting the Company
which: (i) seek to restrain, enjoin, prevent the consummation of or otherwise affect the transactions contemplated by this Agreement
or (ii) question the validity or legality of any transactions or seeks to recover damages or to obtain other relief in connection
with any transactions.

 

2.2.5           Authorization.
All corporate action on the part of the Company, its officers, directors and stockholders necessary for the authorization, execution
and delivery of this Agreement, the Securities, the performance of all obligations of the Company thereof, and the authorization,
issuance (or reservation for issuance) of the Securities, has been taken. This Agreement constitutes and, when issued, the Units
and the Warrants will constitute, valid and legally binding obligations of the Company, enforceable in accordance with their respective
terms, subject to: (i) judicial principles limiting the availability of specific performance, injunctive relief, and other equitable
remedies and (ii) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect generally
relating to or affecting creditors’ rights.

 

2.2.6           Capitalization.
The authorized capital stock of the Company on the date hereof, consists of 10,000,000 shares of Class F Common Stock, 5,318,750
shares of which are issued and outstanding, 90,000,000 shares of Class A Common Stock, no shares of which are issued and outstanding,
10,000,000 shares of Common Stock without designation, par value, $0.0001, no shares of which are issued and outstanding, and 10,000,000
shares of preferred stock, no shares of which are issued and outstanding. All issued and outstanding shares of the Company’s
Common Stock (a) have been duly authorized and validly issued, and (b) are fully paid and non-assessable. The rights, preferences,
privileges and restrictions of the Common Stock are as stated in the Certificate of Incorporation currently on file with the Delaware
Secretary of State. There are no outstanding rights, options, warrants, preemptive rights, rights of first refusal or similar rights
for the purchase or acquisition from the Company of any securities of the Company.

 

3.             Settlement
Date and Delivery.

 

3.1         Closing.
The settlement of the forward purchase contract for the purchase and sale of the Securities hereunder (the “Closing”)
shall be held at the same date and time as the closing of the Business Combination (the date of the Closing being referred to as
the “Closing Date”). At the Closing, the Company will issue to the Subscriber the Units and the shares of Class
F Common Stock, registered in the name of the Subscriber, against delivery of the purchase price of $40,004,700.35 in cash via
a wire to an account specified in writing by the Company no later than five (5) business days prior to the Closing.

 

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3.2         Conditions
to Closing of the Company.

 

The Company’s obligations to sell
and issue the Securities at the Closing are subject to the fulfillment of the following conditions:

 

3.2.1           Representations.
The representations made by the Subscriber in Section 2 of this Agreement shall be true and correct in all material respects when
made, and shall be true and correct in all material respects on the applicable Closing Date.

 

3.2.2           Blue
Sky. The Company shall have obtained all necessary Blue Sky law permits and qualifications, or secured an exemption therefrom,
required by any state for the offer and sale of the Securities.

 

3.3         Conditions
to Closing of the Subscriber.

 

The Subscriber’s obligation to purchase
the Securities at the Closing is subject to the fulfillment on or prior to the Closing Date of each of the following conditions:

 

3.3.1           Representations
and Warranties Correct. The representations and warranties made by the Company in Section 2 hereof shall be true and correct
in all material respects when made and shall be true and correct in all material respects on and as of the Closing Date (unless
they specifically speak as of another date in which case they shall be true and correct in all material respects as of such date)
with the same force and effect as if they had been made on and as of said date.

 

3.3.2           Covenants.
All covenants, agreements and conditions contained in this Agreement to be performed by the Company on or prior to the Closing
Date shall have been performed or complied with in all material respects.

 

3.3.3           Blue
Sky. The Company shall have obtained all necessary Blue Sky law permits and qualifications, or secured an exemption therefrom,
required by any state for the offer and sale of the Securities.

 

3.3.4           Subscriber
Consent. The Subscriber shall have given written consent (in its capacity as a party to this agreement and not as a director
or existing stockholder), which may be given by e-mail, to the Business Combination (which it may withhold at its sole discretion)
which shall be withheld or granted no later than 48 hours after receipt of notification that the Board of the Company has met and
agreed to enter into a definitive acquisition agreement for the Business Combination. The Business Combination shall be consummated
concurrently with the Closing but only on substantially the terms approved by the Subscriber without any waiver of any failure
to satisfy a condition to close the Business Combination, except for waivers of satisfying conditions to close the Business Combination
the failure of which, in the aggregate, are immaterial.

 

3.3.5           Ancillary
Documents. The Company and Subscriber shall have entered into a registration rights agreement as described in Section 5.5,
an agreement among sponsors, and an insider letter each in the last form previously provided to the Subscriber. The Company and
Macquarie Capital (USA) Inc. shall have entered into a right of first refusal for the provision of investment banking services.

 

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3.3.6           IPO
Closing. The Company shall have consummated an IPO raising at least $150 million in gross proceeds.

 

4.           Terms of
the Units and Warrants.

 

4.1         The
Warrants will be substantially identical to the Warrants to be included in the units offered in the IPO as set forth in the Warrant
Agreement to be entered into with Continental Stock Transfer and Trust Company at or prior to the IPO (the “Warrant Agreement”),
except that the Warrants: (i) will be non-redeemable so long as they are held by the initial holder thereof (or any of its permitted
transferees), and (ii) are exercisable on a “cashless” basis if held by Subscriber or its permitted transferees.

 

4.2         The
Units and their component parts will be substantially identical to the units to be offered in the IPO except that the Units and
component parts are being purchased pursuant to an exemption from the registration requirements of the Securities Act and will
become freely tradable only after they are registered pursuant to the Registration Rights Agreement to be signed on or before the
date of the Company’s registration statement to be filed in connection with the IPO, as amended at the time it becomes effective
(the “Registration Statement”).

 

5.           Restrictions
on Transfer.

 

5.1         Securities
Law Restrictions. In addition to any restrictions to be contained in that certain letter agreement (commonly known as an “Insider
Letter”) dated as of the closing of the IPO by and between Subscriber and the Company and subject to the exceptions contained
in Section 9(a) thereof, Subscriber agrees not to sell, transfer, pledge, hypothecate or otherwise dispose of all or any part of
the Securities unless, prior thereto (a) a registration statement on the appropriate form under the Securities Act and applicable
state securities laws with respect to the Securities proposed to be transferred shall then be effective or (b) the Company has
received an opinion from counsel reasonably satisfactory to the Company, that such registration is not required because such transaction
is exempt from registration under the Securities Act and the rules promulgated by the Securities and Exchange Commission thereunder
and with all applicable state securities laws.

 

5.2         Lock
up. Subscriber acknowledges that the Class F Common Stock will be subject to lock up provisions (the “Lock up”)
contained in the Insider Letter. Pursuant to the Insider Letter and subject to the exceptions contained therein, Subscriber will
agree not to sell, transfer, pledge, hypothecate or otherwise dispose of all or any part of the Class F Common Stock until the
earlier to occur of: (a) one year after the completion of the Business Combination or (b) the date on which the Company completes
a liquidation, merger, stock exchange or other similar transaction after its Business Combination that results in all of its stockholders
having the right to exchange their Shares for cash, shares or other property. Notwithstanding the foregoing, if the last sale price
of the Common Stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations
and the like) for any 20 trading days within any 30 trading day period commencing at least 150 days after the Business Combination
or (c) if the Company consummates a transaction after its Business Combination which results in its stockholders having the right
to exchange their Shares for cash or property worth at least $12.00 per share, the Shares will be released from the Lock up.

 

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5.3         Restrictive
Legends. All certificates representing the Securities shall have endorsed thereon legends substantially as follows:

 

“THE SECURITIES REPRESENTED
HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND NEITHER THE SECURITIES
NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER SUCH ACT OR SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND SUCH LAWS WHICH, IN THE OPINION OF COUNSEL,
IS AVAILABLE.”

 

All certificates representing the Class F Common Stock shall
have endorsed thereon legends substantially as follows:

 

“THE SECURITIES REPRESENTED
BY THIS CERTIFICATE ARE SUBJECT TO A LOCKUP AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED DURING THE
TERM OF THE LOCKUP EXCEPT PURSUANT TO ITS TERMS.”

 

5.4         Additional
Units or Substituted Securities. In the event of the declaration of a share dividend, the declaration of an extraordinary dividend
payable in a form other than Common Stock, a spin-off, a share split, an adjustment in conversion ratio, a recapitalization or
a similar transaction affecting the Company’s outstanding Common Stock without receipt of consideration (other than those
occurring at the time of the IPO in connection with a change in the size of the offering), any new, substituted or additional securities
or other property which are by reason of such transaction distributed with respect to any Securities subject to this Section 5.3
or into which such Securities thereby become convertible shall immediately be subject to this Section 5.3 and Section 3. Appropriate
adjustments to reflect the distribution of such securities or property shall be made to the number and/or class of Securities subject
to this Section 5.3 and Section 3. The Securities shall not be subject to forfeiture upon failure of the underwriters to exercise
their over-allotment option in the IPO.

 

5.5         Registration
Rights. Subscriber acknowledges that the Securities are being purchased pursuant to an exemption from the registration requirements
of the Securities Act and will become freely tradable only after certain conditions are met or they are registered pursuant to
a Registration Rights Agreement to be entered into with the Company prior to the closing of the IPO which shall be on the same
terms as such registration rights granted to Apple Orange LLC, Noyac Path LLC, Periscope LLC, and Terrapin Partners Employee Partnership
3 LLC.

 

6.           Other Agreements.

 

6.1         Further
Assurances. Each of the Company and Subscriber agrees to execute such further instruments and to take such further action as
may reasonably be necessary to carry out the intent of this Agreement.

 

6.2         Notices.
All notices, statements or other documents which are required or contemplated by this Agreement shall be: (i) in writing and delivered
personally or sent by first class registered or certified mail, overnight courier service or facsimile or electronic transmission
to the address designated in writing, (ii) by facsimile to the number most recently provided to such party or such other address
or fax number as may be designated in writing by such party and (iii) by electronic mail, to the electronic mail address most recently
provided to such party or such other electronic mail address as may be designated in writing by such party. Any notice or other
communication so transmitted shall be deemed to have been given on the day of delivery, if delivered personally, on the business
day following receipt of written confirmation, if sent by facsimile or electronic transmission, one (1) business day after delivery
to an overnight courier service or five (5) days after mailing if sent by mail.

 

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6.3         Entire
Agreement. This Agreement, together with that certain Insider Letter to be entered into between Subscriber and the Company,
substantially in the form to be filed as an exhibit to the Registration Statement, embodies the entire agreement and understanding
between the Subscriber and the Company with respect to the subject matter hereof and supersedes all prior oral or written agreements
and understandings relating to the subject matter hereof. No statement, representation, warranty, covenant or agreement of any
kind not expressly set forth in this Agreement shall affect, or be used to interpret, change or restrict, the express terms and
provisions of this Agreement.

 

6.4         Modifications
and Amendments. The terms and provisions of this Agreement may be modified or amended only by written agreement executed by
all parties hereto.

 

6.5         Waivers
and Consents. The terms and provisions of this Agreement may be waived, or consent for the departure therefrom granted, only
by written document executed by the party entitled to the benefits of such terms or provisions. No such waiver or consent shall
be deemed to be or shall constitute a waiver or consent with respect to any other terms or provisions of this Agreement, whether
or not similar. Each such waiver or consent shall be effective only in the specific instance and for the purpose for which it was
given, and shall not constitute a continuing waiver or consent.

 

6.6         Assignment.
The rights and obligations under this Agreement may not be assigned by either party hereto without the prior written consent of
the other party, except to an affiliate of the Subscriber.

 

6.7         Benefit.
All statements, representations, warranties, covenants and agreements in this Agreement shall be binding on the parties hereto
and shall inure to the benefit of the respective successors and permitted assigns of each party hereto. Nothing in this Agreement
shall be construed to create any rights or obligations except among the parties hereto, and no person or entity shall be regarded
as a third-party beneficiary of this Agreement.

 

6.8         Governing
Law. This Agreement and the rights and obligations of the parties hereunder shall be construed in accordance with and governed
by the laws of New York applicable to contracts wholly performed within the borders of such state, without giving effect to the
conflict of law principles thereof.

 

6.9         Severability.
In the event that any court of competent jurisdiction shall determine that any provision, or any portion thereof, contained in
this Agreement shall be unreasonable or unenforceable in any respect, then such provision shall be deemed limited to the extent
that such court deems it reasonable and enforceable, and as so limited shall remain in full force and effect. In the event that
such court shall deem any such provision, or portion thereof, wholly unenforceable, the remaining provisions of this Agreement
shall nevertheless remain in full force and effect.

 

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6.10       No
Waiver of Rights, Powers and Remedies. No failure or delay by a party hereto in exercising any right, power or remedy under
this Agreement, and no course of dealing between the parties hereto, shall operate as a waiver of any such right, power or remedy
of such party. No single or partial exercise of any right, power or remedy under this Agreement by a party hereto, nor any abandonment
or discontinuance of steps to enforce any such right, power or remedy, shall preclude such party from any other or further exercise
thereof or the exercise of any other right, power or remedy hereunder. The election of any remedy by a party hereto shall not constitute
a waiver of the right of such party to pursue other available remedies. No notice to or demand on a party not expressly required
under this Agreement shall entitle the party receiving such notice or demand to any other or further notice or demand in similar
or other circumstances or constitute a waiver of the rights of the party giving such notice or demand to any other or further action
in any circumstances without such notice or demand.

 

6.11       Survival
of Representations and Warranties. All representations and warranties made by the parties hereto in this Agreement or in any
other agreement, certificate or instrument provided for or contemplated hereby, shall survive the execution and delivery hereof
and any investigations made by or on behalf of the parties.

 

6.12       No
Broker or Finder. Each of the parties hereto represents and warrants to the other that no broker, finder or other financial
consultant has acted on its behalf in connection with this Agreement or the transactions contemplated hereby in such a way as to
create any liability on the other. Each of the parties hereto agrees to indemnify and save the other harmless from any claim or
demand for commission or other compensation by any broker, finder, financial consultant or similar agent claiming to have been
employed by or on behalf of such party and to bear the cost of legal expenses incurred in defending against any such claim.

 

6.13       Headings
and Captions. The headings and captions of the various subdivisions of this Agreement are for convenience of reference only
and shall in no way modify or affect the meaning or construction of any of the terms or provisions hereof.

 

6.14       Counterparts.
This Agreement may be executed in one or more counterparts, all of which when taken together shall be considered one and the same
agreement and shall become effective when counterparts have been signed by each party and delivered to the other party, it being
understood that both parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission
or any other form of electronic delivery, 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 signature page were an original thereof.

 

6.15       Construction.
The parties hereto have participated jointly in the negotiation and drafting of this Agreement. If an ambiguity or question of
intent or interpretation arises, this Agreement will be construed as if drafted jointly by the parties hereto and no presumption
or burden of proof will arise favoring or disfavoring any party hereto because of the authorship of any provision of this Agreement.
The words “include,” “includes,” and “including” will be deemed to be
followed by “without limitation.” Pronouns in masculine, feminine, and neuter genders will be construed to include
any other gender, and words in the singular form will be construed to include the plural and vice versa, unless the context otherwise
requires. The words “this Agreement,” “herein,” “hereof,” “hereby,”
“hereunder,” and words of similar import refer to this Agreement as a whole and not to any particular subdivision
unless expressly so limited. The parties hereto intend that each representation, warranty, and covenant contained herein will have
independent significance. If any party hereto has breached any representation, warranty, or covenant contained herein in any respect,
the fact that there exists another representation, warranty or covenant relating to the same subject matter (regardless of the
relative levels of specificity) which such party hereto has not breached will not detract from or mitigate the fact that such party
hereto is in breach of the first representation, warranty, or covenant.

 

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6.16       Mutual
Drafting. This Agreement is the joint product of the Subscriber and the Company and each provision hereof has been subject
to the mutual consultation, negotiation and agreement of such parties and shall not be construed for or against any party hereto.

 

7.           Tender or
Redemption of Shares. The Subscriber agrees not to tender any Shares in connection with a tender or redemption offer presented
to the Company’s stockholders in connection with the Business Combination.

 

8.           Indemnification.
Each party shall indemnify the other against any loss, cost or damages (including reasonable attorney’s fees and expenses)
incurred as a result of such party’s breach of any representation, warranty, covenant or agreement in this Agreement.

 

[Signature Page Follows]

 

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If the foregoing accurately sets forth our
understanding and agreement, please sign the enclosed copy of this Agreement and return it to us.

 

	 	Very truly yours,  
	 	 	 	 
	 	Terrapin 3 Acquisition Corporation
	 	 
	 	By:	 
	 	Name:	Sanjay Arora  
	 	Title:	Chief Executive Officer  

 

Accepted and agreed this __________ day of _____________________,
2014.

 

	MIHI LLC, 	 
	a Delaware limited liability company	 
	 	 	 
	By: 	 	 
	Name: 	 	 
	Title: 	 	 

 

	By: 	 	 
	Name: 		 
	Title: 	 	 

 

    	11EXHIBIT 10.1

 

A Delaware Limited Liability
Company

4500 SW Kruse Way, Suite 170
w Lake Oswego, OR 97035

(503) 303-5100 w
(855)-696-6887 w Fax (855) 696-8888

 

LOAN AND SECURITY AGREEMENT NUMBER
1020

 

		DEBTOR:	QUANTUMSPHERE, INC., a Nevada corporation (“Debtor”)

 

		LENDER:	NOVUS CAPITAL GROUP, LLC, a Delaware limited liability
company (“Lender”)

 

THIS LOAN AND SECURITY
AGREEMENT is made by and between Debtor and Lender in consideration of the mutual agreements contained herein, the parties
hereto agree as follows:

 

SECTION 1.            
definitions.

 

1.1               
Defined Terms. As used in this Agreement the following terms have the following defined
meanings, unless the context otherwise requires (such terms to be equally applicable to both singular and plural forms of the terms
defined):

 

“Agreement”
means this Loan and Security Agreement, as the same may from time to time be amended, modified, replaced or supplemented.

 

“Business Day”
means a day other than a Saturday, Sunday or legal holiday under the laws of the State of Oregon.

 

“Closing Date”
means each date on which a Loan is made pursuant hereto.

 

“Code” means
the Uniform Commercial Code as from time to time in effect in the State of Oregon.

 

“Collateral”
means Debtor’s assets which are pledged to secure this Agreement and include all of Debtor’s assets currently owned
or hereafter acquired, including, but not limited to, Debtor’s production and manufacturing equipment and Intellectual Property
and as identified on one or more Schedules that are attached to or incorporated in this Agreement.

 

“Commencement Date”
means the beginning of the contracted term under each Loan. The Commencement Date of each Loan will be the 10th day
of the month. If the Disbursement Date occurs on or before the 10th of the month, the commencement Date shall be the
10th day of the month in which the Disbursement Date occurred. If the Disbursement Date occurs after the 10th
of the month, the Commencement Date shall be the 10th day of the month immediately following the Disbursement Date.

 

“Commitment”
means the obligation of Lender to make the Loans in the aggregate principal amount specified in Section 2.1.

 

“Default”
shall mean any event which with notice, lapse of time, or any further condition, event or act would constitute an Event of Default.

 

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“Disbursement Date”
means the date on which the Note for each Loan is signed by both Debtor and Lender and funds are disbursed under the terms of such
Note.

 

“Disbursed Principal”
means the original principal amount borrowed on each Loan.

 

“Draw Period”
means the period of time from the date of this Agreement through the earlier to occur of (i) January 15, 2015, or (ii) the occurrence
of an Event of Default.

 

“Event of Default”
has the meaning set forth in Section 7.

 

“Financial Statements”
means Debtor’s financial statements as filed with the Securities and Exchange Commission, including, but not limited to,
balance sheets, profit and loss, and cash flow statements.

 

“Insolvency Proceeding”
means any proceeding commenced by or against any Person under any provision of the Bankruptcy Code or under any other state or
federal bankruptcy or insolvency law (including any receivership or like proceeding), assignments for the benefit of creditors,
formal or informal moratoria, compositions, extensions generally with creditors, or proceedings seeking reorganization, arrangement,
or other similar relief.

 

“Interim Interest”
means interest that is paid on the Disbursed Principal for that period of time between the Disbursement Date and the Commencement
Date. Interim Interest shall be paid at a daily rate equal to the Interest Rate divided by 365.

 

“Interest Rate”
is a fixed per annum rate per each Loan equal to 15.50%.

 

“Liens” means
liens, mortgages, security interests, pledges, title retentions, charges, or other encumbrances of any kind whether voluntarily
incurred or arising by operation of law or otherwise on the Collateral.

 

“Loan” means
each loan or credit extension made by Lender to Debtor pursuant to each Note and this Agreement.

 

“Loan Documents”
means this Agreement, the Notes, Supplements, Schedules, any other security agreement or loan documents executed by Debtor in connection
with this Agreement, and any other agreement entered into, now or in the future, by Debtor and Lender in connection herewith.

 

“Note” means
each Promissory Note of Debtor evidencing a Loan, as described in Section 2.2, substantially in the form of Exhibit A hereto,
as the same may from time to time be amended, modified, replaced or supplemented.

 

“Obligations”
means (i) the aggregate unpaid principal amount of, and accrued interest on, the Notes; (ii) all other obligations and liabilities
of Debtor, now existing or hereafter incurred, under, arising out of or in connection with this Agreement, any Note, or any other
Loan Document; and (iii) any and all other present and future indebtedness, obligations and liabilities of any kind whatsoever
of Debtor to Lender, whether direct or indirect, joint or several, absolute or contingent, liquidated or unliquidated, secured
or unsecured, matured or unmatured and whether originally contracted with Lender or otherwise acquired by Lender or from time to
time reduced and thereafter increased.

 

“Payment Due Date”
shall be the 10th day of each month and the first scheduled payment shall be due on the 10th day of the month
immediately following the Commencement Date.

 

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“Person” means
natural persons, corporations, limited liability companies, limited partnerships, general partnerships, limited liability partnerships,
joint ventures, trusts, land trusts, business trusts, estates, other organizations and entities, and governmental agencies and
political subdivisions.

 

“Prepayment”
means payment in full of the Loans prior to their maturities by paying Lender an amount equal to the sum of i) all accrued interest,
charges and fees; ii) unpaid principal; and iii) any applicable Prepayment Premium.

 

“Prepayment Premium”
means a charge paid by Debtor to Lender to terminate Debtor’s Loan(s) within the first six months after the Commencement
Date of any Loan. The Prepayment Premium shall equal 1.50% of the Disbursed Principal.

 

“Supplement”
means each Supplement executed and delivered by Debtor in substantially the form of Exhibit B attached hereto.

 

1.2               
Accounting Terms. All accounting terms not specifically defined herein shall be construed
in accordance with generally accepted accounting principles.

 

SECTION 2.            
AMOUNT AND TERMS OF LOAN.

 

2.1               
Commitment. Subject to the terms and conditions of this Agreement, Lender agrees to
make up to two Loans (“Tranche 1” and “Tranche 2”), from time to time during the Draw Period, to Debtor
in an aggregate principal amount not to exceed One Million Dollars and 00/100 ($1,000,000.00). Each Loan shall be for a principal
amount of Five Hundred Thousand Dollars and 00/100 ($500,000.00) and the conditions precedent for the granting of each Loan are
detailed in Exhibit A-1 (“Tranche 1”) and Exhibit A-2 (“Tranche 2”). The obligation of Lender to make Loans
hereunder shall terminate on the expiration of the Draw Period. Debtor shall give Lender at least five (5) Business Days prior
written notice of the date and amount of each proposed Loan. No Loan which is repaid may be reborrowed. 

 

2.2               
The Notes. Each Loan shall be evidenced by a Note of Debtor substantially in the form
of Exhibit A-1 and Exhibit A-2 hereto, with appropriate insertions therein as to amounts, dates and interest rate, in each case,
as determined by Lender and as detailed hereunder. Debtor’s obligation to repay the Notes and all other amounts payable hereunder
is absolute and unconditional under any and all circumstances and shall not be affected by any circumstances of any character whatsoever.
Each Note shall (i) be dated the date on which the Loan evidenced thereby is made; (ii) be for the term specified in such Note;
and (iii) be stated to be paid in consecutive monthly installments of principal plus interest, on the dates and in the amounts
set forth in such Note. The Notes (and the related Loans) may be prepaid in whole but not in part. 

 

2.3               
Use of Proceeds. Debtor shall use the proceeds of each Loan solely as working capital
and not for personal, family, or household purposes. 

 

SECTION 3.            
CONDITIONS OF BORROWING.

 

3.1               
Conditions of Each Loan. Lender shall not be required to make any Loan hereunder (including
the initial Loan) unless on the Closing Date of such Loan:

 

(a)                
Note. The Note evidencing such Loan and all related Loan Documents shall have been
duly executed and delivered to Lender.

 

(b)                
Insurance. Lender shall have received evidence satisfactory to it that the Collateral
used to secure such Loan is insured against loss, theft, damage or destruction in an amount not less than the full replacement
value of the Collateral, with loss payable to Lender. At Lender’s request, Debtor also shall provide and maintain primary
comprehensive general all risk liability insurance.

 

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(c)                
Security Interest. All filings deemed necessary or desirable by Lender to establish,
protect, preserve and perfect its security interest in the Collateral that is pledged as security for such Loan as a valid first
priority perfected security interest shall have been duly effected, and all fees, taxes and other charges relating to such filings
and recordings shall have been paid by Debtor.

 

(d)                
Representations. (i) The representations and warranties contained in this Agreement
shall be true and correct in all respects on and as of the date of the making of such Loan with the same effect as if made on and
as of such date; (ii) no Default or Event of Default shall be in existence on the date of the making of such Loan or shall occur
as a result of such Loan; and (iii) the acceptance by Debtor of each Loan shall constitute a representation by Debtor that the
statements contained in clauses (i) and (ii) above are true and correct on the date of such Loan.

 

(e)                
Other Documents and Information. Lender shall have received from Debtor, in form and
substance satisfactory to Lender, such other documents and information as Lender shall reasonably request.

 

(f)                 
Legal Matters. All legal matters with respect to and all legal documents executed in
connection with the transactions contemplated by this Agreement shall be satisfactory to counsel for Lender.

 

(g)                
Default. No Default shall have occurred or will exist after making such Loan.

 

3.2               
Conditions of Tranche 1 Loan. Lender shall not be required to make the Tranche 1 Loan
hereunder unless Lender is in receipt of:

 

(a)                
Fully executed Loan Documents; and

 

(b)                
Perfected Security Interest (to occur upon the filing of a financing statement on Form UCC-1
with the Nevada Secretary of State and the California Secretary of State immediately prior to the wiring of the initial Loan evidenced
by the Note represented by Exhibit A-1 hereto).

 

3.3               
Conditions of Tranche 2 Loan. Lender shall not be required to make the Tranche 2 Loan
hereunder unless:

 

		(a)	Debtor shall have raised additional equity of no less than Three
Million Dollars and 00/100 ($3,000,000.00)* on or before December 31, 2014 (the “Additional Round”);

 

		(i)	* In the event Debtor raises a minimum of $2.5 million, but less than $3 million, in the Additional
Round, Lender will review the circumstances of the Additional Round and Debtor’s financial condition at the time of the Additional
Round and use its best efforts to amend the $3 million requirement;

 

		(b)	The payments on Tranche 1 shall have been paid as agreed; and

 

		(c)	Debtor may not be in default on any of its obligations with any of
its creditors.

 

SECTION 4.            
REPRESENTATIONS AND WARRANTIES.

 

To induce Lender to enter into this Agreement
and to make each Loan, Debtor represents and warrants to Lender that:

 

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4.1                     
Organization. Debtor is a corporation duly organized or formed, validly existing and
in good standing under the laws of Nevada and is qualified and licensed to do business and is in good standing in any jurisdiction
in which the conduct of its business or its ownership of property requires that it be qualified.

 

4.2                     
Power and Authority. Debtor has full power, authority and legal right to execute and
deliver this Agreement and the Notes, to perform its obligations hereunder and thereunder, to borrow hereunder and to grant the
security interest created by this Agreement.

 

4.3                     
Consents and Permits. No consent of any other party, and no consent, license, approval
or authorization of, exemption by, or registration or declaration with, any governmental body, authority, bureau or agency is required
in connection with (i) the execution, delivery or performance by Debtor of this Agreement or the Notes; or (ii) the validity or
enforceability of this Agreement or the Notes.

 

4.4                     
No Legal Bar. The execution, delivery and performance by Debtor of this Agreement,
the Notes and other Loan Documents do not and will not violate any provision of any applicable law or regulation or of any judgment,
award, order, writ or decree of any court or governmental instrumentality, will not violate any provision of the organizational
documents of Debtor and will not violate any provision of or cause a default under any mortgage, indenture, contract, agreement
or other undertaking to which Debtor is a party or which purports to be binding upon Debtor or upon any of its assets, and will
not result in the creation or imposition of any lien on any of the assets of Debtor other than the security interest intended to
be created hereby.

 

4.5                     
No Defaults. Debtor is not in default, and no event or condition exists which, after
the giving of notice or lapse of time or both, would constitute an event of default, under any mortgage, indenture, contract, agreement,
judgment or other undertaking to which Debtor is a party or which purports to be binding upon Debtor or upon any of its assets.

 

4.6                     
Enforceability. This Agreement, and each Note or other Loan Document Debtor is required
to execute hereunder, when delivered, have been duly authorized, executed and delivered by Debtor and constitute legal, valid and
binding obligations of Debtor enforceable in accordance with their terms. 

 

4.7                     
No Litigation. There is no action, suit, investigation or proceeding pending or, to
Debtor’s knowledge, threatened against or affecting Debtor or any of its assets which could have an adverse effect upon the
Collateral or repayment of the Loans or a material adverse effect on the business, operations or financial condition of Debtor.

 

4.8                     
Taxes. Debtor has filed all Federal, state and local income tax returns that are required
to be filed, and has paid (or provided for the payment of) all taxes as shown on said returns and all assessments received by it
to the extent that such taxes and assessments have become due, and Debtor does not have any knowledge or any actual or proposed
deficiency or additional assessment in connection therewith. The charges, accruals and reserves on the books of Debtor in respect
of Federal, state and local taxes for all open years, and for the current fiscal year, make adequate provision for all unpaid tax
liabilities for such periods.

 

4.9                    
Financial Statements. All financial statements for Debtor delivered to Lender are true
and accurate as of the dates thereof, and there has not been any adverse change in Debtor’s financial condition since the
date of the most recent financial statements submitted to Lender.

 

4.10                 
Full Disclosure. No written representation, warranty or other statement of Debtor in
any certificate, agreement or other document given to Lender, as of the date such representations, warranties, or other statements
were made, taken together with all such written certificates, agreements and other document statements given to Lender, contains
any untrue statement of a material fact or omits to state a material fact necessary to make the statements contained in the certificates
or statements not misleading.

 

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SECTION 5.            
COVENANTS.

 

Debtor covenants and
agrees that from and after the date hereof and so long as the Commitment or any Obligation is outstanding:

 

5.1               
Notices. Debtor will give timely written notice to Lender of (i) the occurrence of
any Default or Event of Default; (ii) the commencement or threat of any material litigation or proceedings affecting Debtor; and
(iii) any dispute between Debtor and any governmental authority or other Person that might materially interfere with the normal
business operations of Debtor.

 

5.2               
Laws; Obligations; Operations. Debtor will (i) comply with all laws in all material
respects and duly observe and conform to all requirements of any governmental authorities relating to the conduct of its business
or to its properties or assets, except for any such requirements for which the results of non-compliance, individually or in the
aggregate, would not affect Debtor’s ability to perform its obligations under the Agreement or result in a Lien upon any
of the Collateral; (ii) maintain its existence as a legal entity and obtain and keep in full force and effect all rights, franchises,
licenses and permits which are necessary to the proper conduct of its business; and (iii) obtain or cause to be obtained as promptly
as possible any governmental, administrative or agency approval and make any filing or registration therewith which at the time
shall be required with respect to the performance of its obligations under this Agreement or the operation of its business.

 

5.3               
Inspection. Lender or its authorized representative may during normal business hours,
subject to Debtor’s prior written consent based on not less than ten (10) days advance notice, inspect the Collateral and
the books and records of Debtor related thereto.

 

5.4               
Further Assurances. Debtor will promptly, at any time and from time to time, at its
sole expense, execute and deliver to Lender such further instruments and other documents, and take such further action, as Lender
may from time to time reasonably request to further carry out the intent and purpose of this Agreement and to establish and protect
the rights, interests and remedies created, or intended to be created, in favor of Lender hereby, including, without limitation,
any and all security agreements, assignments, endorsements of certificates of title, and
all other documents that Lender may reasonably request, in form and substance satisfactory to Lender, to create, perfect and continue
to perfect or to better perfect the Lender’s Liens in the Collateral. To the maximum extent permitted by applicable law,
Debtor authorizes Lender to execute any such Additional Documents in Debtor’s name and authorizes Lender to file such
executed Additional Documents in any appropriate filing office. Debtor will pay or reimburse Lender for any and all reasonable
fees, costs and expenses of whatever kind or nature incurred in connection with the creation, preservation and, upon the occurrence
of an Event of Default which is continuing, protection of Lender’s security interest in the Collateral. 

 

5.5               
No Disposition of Collateral. Without the prior written consent of Lender, Debtor will
not sell, convey, transfer, exchange, lease or otherwise relinquish possession or dispose of any of the Collateral, except for
the sale of inventory in the normal course of Debtor’s business.

 

5.6               
No Liens. Debtor will not create, assume or suffer to exist any Lien of any kind upon
the Collateral, even if junior in priority to Lender, except for the security interest created hereby.

 

5.7               
Insurance. Debtor shall maintain fire and other risk insurance, public liability insurance,
and such other insurance as Lender may require with respect to Debtor’s properties and operations, in form, amounts, coverages
and with insurance companies acceptable to Lender. Debtor, upon request of Lender, will deliver to Lender from time to time the
policies or certificates of insurance in form satisfactory to Lender, including stipulations that coverages will not be cancelled
or diminished without at least ten (10) days prior written notice to Lender. Each insurance policy also shall include an endorsement
providing that coverage in favor of Lender will not be impaired in any way by any act, omission or default of Debtor or any other
person. In connection with all policies covering assets in which Lender holds or is offered a security interest for the Loans,
Debtor will provide Lender with such lender's loss payable or other endorsements as Lender may require.

 

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WARNING

 

Unless you (Debtor) provide us
(Lender) with evidence of insurance coverage as required by our agreements, we may purchase insurance at your expense to protect
our interest. This insurance may, but need not, also protect your interest. If the collateral becomes damaged, the coverage we
purchase may not pay any claim you make or any claim made against you. You may later cancel this coverage by providing evidence
that you have obtained property coverage elsewhere.

 

You are responsible for the cost
of any insurance purchased by us. The cost of this insurance may be added to your loan balance. If the cost is added to your loan
balance, the interest rate on the underlying loan will apply to this added amount. The effective date of coverage may be the date
your prior coverage lapsed or the date you failed to provide proof of coverage.

 

The coverage we purchase may be
considerably more expensive than insurance you can obtain on your own and may not satisfy any need for property damage coverage
or any mandatory liability insurance requirements imposed by applicable law.

 

5.8               
No Changes in Debtor. Without the prior written consent of Lender, which consent shall
not be unreasonably withheld with respect to a merger or asset sale, Debtor will not (i) enter into any merger or consolidation;
(ii) liquidate or dissolve; (iii) sell, transfer or otherwise dispose of all or substantially all of its assets; (iv) change the
form of organization of its business or state of organization or formation; or (v) without thirty (30) days prior written notice
to Lender, change its name or its chief place of business.

 

5.9               
Financial Statements. Debtor will provide to Lender its Financial Statements included
in its 10-Q, 10-K and 8-K filings with the Securities and Exchange Commission, consistent with SEC guidelines and within ten (10)
days after each filing.

 

SECTION 6.            
SECURITY INTEREST.

 

6.1               
Grant of Security Interest. As collateral security for the prompt and complete payment
and performance when due of all the Obligations and to induce Lender to enter into this Agreement and make the Loans in accordance
with the terms hereof, Debtor hereby grants to Lender a senior security interest in, all Debtor’s right, title and interest
in and to the Collateral.

 

6.2               
Filing
of Financing Statements. Debtor authorizes Lender to prepare and file any financing statement necessary or desirable to
perfect Lender’s security interest in the Collateral, and any continuation statement or amendment with respect thereto,
in any appropriate filing office. Debtor hereby ratifies the filing of any financing statement filed without the signature of
Debtor prior to the date hereof.

 

6.3               
Lender Appointed as Attorney-in-Fact. For so long as Debtor has any financial obligations
to Lender, Debtor hereby irrevocably makes, constitutes, and appoints Lender (and any of
Lender’s officers, employees, or agents designated by Lender) as Debtor’s true and lawful attorney, with power to (i)
if Debtor refuses to, or fails timely to execute and deliver any of the documents requested by Lender pursuant to Section 5.4,
sign Debtor’s name on any such document; and (ii) endorse Debtor’s name on any of its payment items that may come into
Lender’s possession. The appointment of Lender as Debtor’s attorney, and each and every one of its rights and powers,
being coupled with an interest, is irrevocable.

 

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SECTION 7.            
EVENTS OF DEFAULT.

 

Each of the following
shall constitute an event of default (“Event of Default”) under this Agreement:

 

(a)                
Debtor shall fail to (i) make any payment of principal or interest on any Loan when due or
(ii) pay any other Obligation after the same becomes due;

 

(b)                
Any representation or warranty made by Debtor in this Agreement or in connection with any
Loan, or by Debtor in any document, certificate or financial or other statement now or hereafter furnished by Debtor to Lender
in connection with this Agreement, shall at any time prove to be untrue or misleading in any material respect as of the time when
made;

 

(c)                
Debtor shall fail to observe any covenant, condition or agreement contained in Section 5;

 

(d)                
Debtor shall fail to observe or perform any other covenant, condition or agreement contained
in this Agreement or any other Loan Documents, and such failure shall continue unremedied for a period of ten (10) days or more;

 

(e)                
There is, under any agreement to which Debtor is a party, a default in the payment or performance
of any obligation to a Person resulting in a right by such Person to accelerate the maturity of any indebtedness, realize on any
collateral, or terminate any agreement material to Debtor’s business;

 

(f)                 
Debtor is unable to pay its debts (including trade debts) as they become due or otherwise
becomes insolvent, or Debtor or any subsidiary of Debtor commences an Insolvency Proceeding;

 

(g)                
An Insolvency Proceeding shall have been commenced against Debtor or any subsidiary of Debtor
and is not dismissed or stayed within forty-five (45) days after the commencement of such proceeding; 

 

(h)                
Any material adverse change in the business, operations or financial condition of Debtor occurs;
or

 

(i)                  
A change in ownership of forty-nine percent (49%) or more of the stock or other equity interests
in Debtor.

 

SECTION 8.            
REMEDIES.

 

8.1               
Termination: Acceleration. If an Event of Default specified in Section 7(f) (only with
respect to commencement of an Insolvency Proceeding) or (g) shall occur, then the Commitment shall immediately terminate and the
Loans and all other Obligations shall become immediately due and payable without any notice or other action by Lender. If
any other Event of Default shall occur and be continuing, then, and in any such event, Lender may, without any notice or
demand, (i) suspend or terminate forthwith the Commitment and (ii) declare the Loans and all other Obligations to be immediately
due and payable.

 

8.2               
Additional Remedies. If an Event of Default shall occur and be continuing, Lender may
exercise, in addition to all other rights and remedies granted to it in this Agreement and in any other instrument or agreement
securing, evidencing or relating to the Obligations, all rights and remedies of a creditor, whether secured or unsecured, under
the Code or under any other applicable law. Without limiting the generality of the foregoing, Debtor agrees that in any such event,
Lender, without notice or demand of any kind (except the notice specified below of the time and place of public or private sale)
to or upon Debtor or any other Person (all and each of which demands and notices are hereby expressly waived), may forthwith collect,
receive, appropriate and realize upon the Collateral, or any part thereof, and may forthwith sell, lease, assign, transfer, give
option or options to purchase or otherwise dispose of and deliver the Collateral (or contract to do so), or any part thereof, in
one or more parcels at public or private sale or sales, at any exchange or broker’s board or at any of Lender’s offices
or elsewhere at such prices as it may deem best, for cash or on credit or for future delivery without assumption of any credit
risk. Lender shall have the right upon any such public sale or sales, to the extent permitted by law, to purchase the whole or
any part of the Collateral so sold, free of any right or equity of redemption in Debtor, which right or equity is hereby expressly
released. Lender shall apply the net proceeds of any such collection, recovery, receipt, appropriation, realization, disposition
or sale (after deducting all reasonable costs and expenses of every kind incurred by Lender or incidental to the sale, disposition,
care, safekeeping, preparation for sale or otherwise of any or all of the Collateral or in any way relating to the rights of Lender
hereunder, including reasonable attorneys’ fees and legal expenses) to the payment in whole or to part of the Obligations,
in such order as Lender may elect and only after so applying such net proceeds and after the payment by Lender of any other amount
required by any provision of law, shall Lender account for the surplus, if any, to Debtor. To the extent permitted by applicable
law, Debtor waives all claims, damages, and demands against Lender arising out of the repossession, retention or sale of the Collateral.
Debtor agrees that Lender need not give more than ten (10) days notice (which notification shall be deemed given when mailed in
accordance with Section 9.2) of the time and place of any public sale or of the time after which a private sale may take place
and that such notice is reasonable notification of such matters. Debtor shall be liable for any deficiency if the proceeds of any
sale or disposition of the Collateral are insufficient to pay the Obligations and all other amounts to which Lender is entitled.

 

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8.3               
Cumulative Remedies. Lender’s rights and remedies under this Agreement and the
other Loan Documents are cumulative and may be exercised singularly or concurrently. Lender has all rights and remedies provided
under this Agreement, the Code, by law, or in equity. Lender’s exercise of any right or remedy is not an election, and no
failure or delay on the part of Lender in exercising any right, remedy, power or privilege hereunder or under any Note shall operate
as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege hereunder or thereunder
preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.

 

8.4               
Waiver by Debtor. Debtor hereby waives presentment, demand, protest or any notice,
except as expressly provided in Section 8 (to the extent permitted by applicable law) of any kind in connection with this Agreement
or any Collateral. To the extent permitted by the Code or other applicable law, Debtor waives any rights now or hereafter conferred
by statute or otherwise which limit or modify any of Lender’s rights or remedies under this Agreement.

 

SECTION 9.            
MISCELLANEOUS.

 

9.1               
Joint and Several Obligations. If Debtor consists of more than one person or entity,
all Obligations of Debtor under this Agreement shall be joint and several, and all references to Debtor shall mean each and every
Debtor.

 

9.2               
Notices. All notices, requests and demands to or upon any party hereto shall be deemed
to have been duly given (i) three (3) Business Days after being deposited in the United States mail, proper postage prepaid when
sent by registered or certified mail, addressed to such party as follows, or to such other address as may be hereafter designated
in writing by such party to the other party hereto; (ii) as of the Business Day after the day delivered to a nationally recognized
overnight courier when delivered to such courier by sender in timely fashion so as to permit next-day delivery; (iii) upon delivery,
when personally delivered; and (iv) upon dispatch when sent by facsimile machine with confirmation of transmittal completion received
by sender:

 

	 	Debtor:	QUANTUMSPHERE, INC., a Nevada corporation
	 	 	2905 Tech Center Drive
	 	 	Santa Ana, CA 92705
	 	 	Attention: Gregory L. Hrncir
	 	 	Fax: (714) 545-6265

 

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		Lender:	NOVUS CAPITAL GROUP, LLC, a Delaware Limited Liability Company

4500 SW Kruse Way, Suite 170

Lake Oswego, OR 98035

Attention: Jim Johnson

Fax: (855) 696-8888

 

9.3               
Indemnity.

 

(a)                
Debtor agrees to pay, and to indemnify and save Lender harmless from any and all taxes, including,
without limitation, sales, use, stamp and personal property taxes (other than any corporate income, capital, franchise or similar
taxes payable by Lender with respect to the payments made to Lender hereunder) and all license, filing, and registration fees and
assessments and other charges, if any, which may be payable or determined to be payable in connection with the execution, delivery
and performance of this Agreement or the Notes or any modification thereof.

 

(b)                
Debtor hereby further agrees to pay, indemnify, and hold Lender harmless from and against
any and all other liabilities, obligations, losses, damages, penalties, claims, actions, judgments, suits, out-of-pocket costs,
expenses (including legal expenses) or disbursements of any kind or nature whatsoever arising out of or relating to the Loan Documents
or transactions described therein, provided, that Debtor shall have no obligation hereunder with respect to indemnified liabilities
arising from the gross negligence or willful misconduct of Lender, as finally determined by a court of competent jurisdiction.

 

9.4               
Payment of Lender’s Costs. Debtor agrees to pay upon demand all of Lender’s
out-of-pocket expenses, including attorneys’ fees, incurred in connection with the negotiation and preparation of the Loan
Documents, including any amendments or modifications thereto. If an Event of Default shall occur and be continuing, Debtor agrees
to reimburse Lender for its reasonable attorney’s fees, court costs and collection costs, whether or not any litigation is
commenced by Lender, which are incurred by Lender to enforce or interpret any of the Loan Documents or collect any Obligations
due to Lender, including, without limitation, (i) the reasonable costs and fees of a collection agency; and (ii) attorney’s
fees and costs incurred at trial, on appeal and in any mediation, arbitration or bankruptcy proceeding. All such amounts shall,
until paid by Debtor to Lender, constitute Obligations of Debtor secured by the Collateral and shall be payable on demand.

 

9.5               
Expenditures by Lender. If not discharged or paid when due, Lender may (but shall not
be obligated to) discharge or pay any amounts required to be discharged or paid by Debtor under this Agreement, including without
limitation all taxes, liens, encumbrances, and other claims, at any time levied or placed on the Collateral. Lender also may (but
shall not be obligated to) pay all costs for insuring, maintaining and preserving the Collateral. All such expenditures incurred
or paid by Lender for such purposes will then bear interest at the highest rate applicable to the Obligations from the date incurred
or paid by Lender to the date of repayment and shall be payable on demand. Any action by Lender hereunder shall not be construed
as curing any default so as to bar Lender from any remedy that it would otherwise have.

 

9.6               
Survival of Representations and Warranties. All representations and warranties made
in this Agreement and any certificates delivered pursuant hereto or thereto shall survive the execution and delivery of this Agreement
and the making of the Loans hereunder, and the agreements contained in Section 9.3 shall survive payment of the Notes.

 

9.7               
Amendment; Waivers. No provision of this Agreement, the Notes, or any related agreements,
may be amended or modified in any way, nor may noncompliance therewith be waived, except pursuant to a written instrument executed
by Lender and Debtor.

 

	Executable QSI Loan and Security Agreement	 	Page 10 of 18
	 	 	 
	Confidential	K.M.	  (signer’s initials)

 

    	 

    	 

    

 

9.8               
Counterparts. This Agreement may be executed by the parties hereto on any number of
separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument. Executed counterparts may be transmitted between Debtor and Lender as i) documents
bearing original signatures sent via mail or overnight express, ii) facsimile, or iii) PDF copies sent electronically and all executed
counterparts, no matter how transmitted shall be legally binding on both Debtor and Lender.

 

9.9               
Headings. The headings of the Sections and paragraphs are for convenience only, are
not part of this Agreement and shall not be deemed to affect the meaning or construction of any of the provisions hereof.

 

9.10           
Successors or Assigns. This Agreement shall be binding upon and inure to the benefit
of Debtor and Lender and their respective successors and assigns, except that Debtor may not assign or transfer its rights or any
interest hereunder.

 

9.11           
Entire Agreement. This Agreement, including all Notes, Supplements, Schedules and Loan
Documents related hereto, contain the complete, final and exclusive statement of the terms of the agreement between Lender and
Debtor relating to the transactions hereby contemplated.

 

9.12           
Choice of Law and Venue; Jury Trial Waiver.

 

(a)                   
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF OREGON, WITHOUT REGARD TO ITS CONFLICT OF LAW PROVISIONS.

 

(b)                   
DEBTOR IRREVOCABLY SUBMITS TO THE PERSONAL JURISDICTION OF ANY
STATE OR FEDERAL COURT IN THE STATE OF OREGON) WITH VENUE IN CLACKAMAS COUNTY, OREGON; PROVIDED THAT NOTHING IN THIS AGREEMENT
SHALL BE DEEMED OR OPERATE TO PRECLUDE LENDER FROM BRINGING SUIT OR TAKING OTHER LEGAL ACTION AGAINST DEBTOR OR THE COLLATERAL
IN CALIFORNIA. EACH OF THE PARTIES HERETO EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR SUIT
COMMENCED IN ANY SUCH COURT, AND EACH OF THE PARTIES HERETO HEREBY WAIVES ANY OBJECTION WHICH IT MAY HAVE BASED UPON LACK OF PERSONAL
JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS. EACH OF THE PARTIES HERETO HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS,
COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINT AND OTHER PROCESS
MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO IT AT THE ADDRESS SET FORTH HEREIN, AND THAT SERVICE SO MADE SHALL BE
DEEMED COMPLETED UPON THE EARLIER OF SUCH PARTY’S ACTUAL RECEIPT THEREOF OR THREE (3) DAYS AFTER DEPOSIT IN THE U.S. MAIL,
PROPER POSTAGE PREPAID.

 

(c)                   
DEBTOR AND LENDER HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR
CAUSE OF ACTION BASED UPON OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING
CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. DEBTOR AND LENDER REPRESENT
THAT EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS. IN THE EVENT OF LITIGATION,
A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

 

9.13           
Correction of Loan Documents. Lender may correct patent errors and fill in any blanks
in the Loan Documents consistent with the agreement of the parties.

 

	Executable QSI Loan and Security Agreement	 	Page 11 of 18
	 	 	 
	Confidential	K.M.	  (signer’s initials)

 

    	 

    	 

    

 

9.14           
Severability; Intent to Limit Charges to Maximum Lawful Rate. If a court of competent
jurisdiction finds any provision of this Agreement or other Loan Documents to be invalid or unenforceable as to any person or circumstance,
such finding shall not render that provision invalid or unenforceable as to any other persons or circumstances. If feasible, any
such offending provision shall be deemed to be modified to be within the limits of enforceability or validity; however, if the
offending provision cannot be so modified, it shall be stricken and all other provisions of this Agreement in all other respects
shall remain valid and enforceable. In no event shall the interest rate or rates payable under the Notes, plus any other amounts
paid in connection herewith or therewith, exceed the highest rate permissible under any law that a court of competent jurisdiction
shall, in a final determination, deem applicable. 

 

9.15           
Time is of the Essence. Time is of the essence in the performance of this Agreement.

 

UNDER OREGON LAW,
MOST AGREEMENTS, PROMISES AND COMMITMENTS MADE BY US (LENDER) CONCERNING LOANS AND OTHER CREDIT EXTENSIONS WHICH ARE NOT FOR PERSONAL,
FAMILY OR HOUSEHOLD PURPOSES OR SECURED SOLELY BY THE BORROWER'S RESIDENCE MUST BE IN WRITING, EXPRESS CONSIDERATION AND BE SIGNED
BY US TO BE ENFORCEABLE.

 

IN WITNESS WHEREOF,
the parties hereto have caused this Agreement to be executed and delivered as of the ____ day of June, 2014.

 

 

Agreed and consented to by

 

LENDER:DEBTOR:

 

NOVUS CAPITAL GROUP, LLC,QUANTUMSPHERE,
INC.,

a Delaware limited liability companya
Nevada corporation

 

	LENDER:	 	DEBTOR:
	 	 	 	 	 
	NOVUS CAPITAL GROUP, LLC,	 	QUANTUMSPHERE, INC.,
	a Delaware limited liability company	 	a Nevada corporation
	 	 	 	 	 
	By: 	 	 	By: 	/s/ Kevin D. Maloney
	Name:   	 	 	Name:   	Kevin D. Maloney
	Title: 	 	 	Title: 	President and CEO

  

	Executable QSI Loan and Security Agreement	 	Page 12 of 18
	 	 	 
	Confidential	K.M.	  (signer’s initials)

 

    	 

    	 

    

 

EXHIBIT A- 1

 

 - SAMPLE -

 

Promissory Note Number 01

 

Hereby made a part of Loan and Security
Agreement Number 1020

 

	AMOUNT: 	$ 500,000.00
	 	 
	DEBTOR: 	QUANTUMSPHERE, INC., a Nevada corporation (“Debtor”)
	LENDER: 	NOVUS CAPITAL GROUP, LLC, a Delaware limited liability company (“Lender”)

 

FOR VALUE RECEIVED,
Debtor promises to pay to the order of Lender, at such address as Lender may designate by notice to Debtor, in lawful money of
the United States, the principal sum of Five Hundred Thousand Dollars and 00/100 ($500,000.00) together with interest, calculated
at 15.50% per annum, in thirty-six (36) consecutive monthly installments (principal and interest) of not less than Seventeen Thousand
Four Hundred Fifty-five Dollars and 34/100 ($17,455.34) each, beginning on August 10, 2014 and continuing on the same day of each
month thereafter through and including July 10, 2017.

 

A documentation fee
of Five Thousand Dollars and 00/100 ($5,000.00) will be deducted from the proceeds of the Loan.

 

This Note is one of
the Notes referred to in the Loan and Security Agreement Number 1020 between Debtor and Lender (as the same may from time to time
be amended, supplemented or otherwise modified, the “Agreement”), is secured as provided in the Agreement, and is subject
to the terms and provisions thereof. Capitalized terms used herein shall have the respective meanings given them in the Agreement
unless otherwise defined herein or unless the context otherwise requires.

 

If a payment is more
than ten (10) days late, Debtor will be assessed a late fee and charged five percent (5%) of such payment.

 

Upon the occurrence
and continuance of any one or more of the Events of Default specified in the Agreement, the amounts then remaining unpaid on this
Note, together with any interest accrued, may be declared to be (or, with respect to certain Events of Default, automatically shall
become) immediately due and payable in the sum of all existing delinquent and accrued interest, late fees and charges plus the
remaining unpaid principal due under the Note. Interest shall accrue on the accelerated balance at the lesser of eighteen percent
(18%) per annum or the highest rate allowed under applicable law.

 

In the event that Lender
or any holder of this Note shall institute any action for the enforcement or the collection of this Note, there shall be immediately
due and payable, in addition to the unpaid balance hereof, all costs and expenses of such action, including reasonable attorneys’
fees and costs, whether incurred at trial, on appeal or in any bankruptcy proceeding.

  

- SAMPLE -

 

	Executable QSI Loan and Security Agreement	 	Page 13 of 18
	 	 	 
	Confidential	K.M.	  (signer’s initials)

 

    	 

    	 

    

 

- SAMPLE -

 

Debtor and any other
person who signs or endorses this Note, to the extent allowed by law, waive presentment, demand for payment, protest and notice
of dishonor. Upon any change in the terms of this Note, and unless otherwise expressly stated in writing, no party who signs this
Note, whether as maker, accommodation maker or endorser, shall be released from liability. All such parties agree that Lender may
renew, or extend (repeatedly and for any length of time) this loan, or release any party or collateral; fail to realize upon or
perfect Lender’s security interest in the collateral; or take any other action deemed reasonably necessary by Lender without
the consent of or notice to anyone. If Debtor consists of more than one person or entity, all obligations of Debtor herein shall
be joint and several.

 

This Promissory Note
is dated this ____ day of June, 2014.

 

	LENDER:	 	DEBTOR:
	 	 	 	 	 
	NOVUS CAPITAL GROUP, LLC,	 	QUANTUMSPHERE, INC., 
	a Delaware limited liability company	 	a Nevada corporation
	 	 	 	 	 
	By: 	- SAMPLE -	 	By: 	- SAMPLE -
	Name:   	 	 	Name:   	Kevin D. Maloney
	Title: 	 	 	Title: 	President and CEO

 

- SAMPLE -

 

	Executable QSI Loan and Security Agreement	 	Page 14 of 18
	 	 	 
	Confidential	K.M.	  (signer’s initials)

 

    	 

    	 

    

 

EXHIBIT A- 2

 

 - SAMPLE -

 

Promissory Note Number 02

 

Hereby made a part of Loan and Security
Agreement Number 1020

  

Conditions
precedent to funding. Lender shall be under no obligation to enter into this Promissory Note Number 02 unless:

 

		(a)	Debtor shall have raised additional equity of no less than Three Million Dollars and 00/100 ($3,000,000.00)*
on or before December 31, 2014 (the “Additional Round”);

 

		(i)	* In the event Debtor raises a minimum of $2.5 million, but less than $3 million, in the Additional
Round, Lender will review the circumstances of the Additional Round and Debtor’s financial condition at the time of the Additional
Round and use its best efforts to amend the $3 million requirement.

 

		(b)	The payments on Tranche 1 shall have been paid as agreed; and

 

		(c)	Debtor may not be in default on any of its obligations with any of its creditors.

 

 

  

	AMOUNT: 	$ 500,000.00
	 	 
	DEBTOR: 	QUANTUMSPHERE, INC., a Nevada corporation (“Debtor”)
	LENDER: 	NOVUS CAPITAL GROUP, LLC, a Delaware limited liability company (“Lender”)

 

FOR VALUE RECEIVED,
Debtor promises to pay to the order of Lender, at such address as Lender may designate by notice to Debtor, in lawful money of
the United States, the principal sum of Five Hundred Thousand Dollars and 00/100 ($500,000.00) together with interest, calculated
at 15.50% per annum, in thirty-six (36) consecutive monthly installments (principal and interest) of not less than Seventeen Thousand
Four Hundred Fifty-five Dollars and 34/100 ($17,455.34) each, beginning on March 10, 2015 and continuing on the same day of each
month thereafter through and including February 10, 2018.

 

A documentation fee
of Five Thousand Dollars and 00/100 ($5,000.00) will be deducted from the proceeds of the Loan.

 

This Note is one of
the Notes referred to in the Loan and Security Agreement Number 1020 between Debtor and Lender (as the same may from time to time
be amended, supplemented or otherwise modified, the “Agreement”), is secured as provided in the Agreement, and is subject
to the terms and provisions thereof. Capitalized terms used herein shall have the respective meanings given them in the Agreement
unless otherwise defined herein or unless the context otherwise requires.

 

	Executable QSI Loan and Security Agreement	 	Page 15 of 18
	 	 	 
	Confidential	K.M.	  (signer’s initials)

 

    	 

    	 

    

 

- SAMPLE -

 

- SAMPLE -

 

If a payment is more
than ten (10) days late, Debtor will be assessed a late fee and charged five percent (5%) of such payment.

 

Upon the occurrence
and continuance of any one or more of the Events of Default specified in the Agreement, the amounts then remaining unpaid on this
Note, together with any interest accrued, may be declared to be (or, with respect to certain Events of Default, automatically shall
become) immediately due and payable in the sum of all existing delinquent and accrued interest, late fees and charges plus the
remaining unpaid principal due under the Note. Interest shall accrue on the accelerated balance at the lesser of eighteen percent
(18%) per annum or the highest rate allowed under applicable law.

 

In the event that Lender
or any holder of this Note shall institute any action for the enforcement or the collection of this Note, there shall be immediately
due and payable, in addition to the unpaid balance hereof, all costs and expenses of such action, including reasonable attorneys’
fees and costs, whether incurred at trial, on appeal or in any bankruptcy proceeding.

 

Debtor and any other
person who signs or endorses this Note, to the extent allowed by law, waive presentment, demand for payment, protest and notice
of dishonor. Upon any change in the terms of this Note, and unless otherwise expressly stated in writing, no party who signs this
Note, whether as maker, accommodation maker or endorser, shall be released from liability. All such parties agree that Lender may
renew, or extend (repeatedly and for any length of time) this loan, or release any party or collateral; fail to realize upon or
perfect Lender’s security interest in the collateral; or take any other action deemed reasonably necessary by Lender without
the consent of or notice to anyone. If Debtor consists of more than one person or entity, all obligations of Debtor herein shall
be joint and several.

 

This Promissory Note
is dated this ____ day of ________, 201_.

 

	LENDER:	 	DEBTOR:
	 	 	 	 	 
	NOVUS CAPITAL GROUP, LLC,	 	QUANTUMSPHERE, INC., 
	a Delaware limited liability company	 	a Nevada corporation
	 	 	 	 	 
	By: 	- SAMPLE -	 	By: 	- SAMPLE -
	Name:   	 	 	Name:   	Kevin D. Maloney
	Title: 	 	 	Title: 	President and CEO

 

- SAMPLE -

 

	Executable QSI Loan and Security Agreement	 	Page 16 of 18
	 	 	 
	Confidential	K.M.	  (signer’s initials)

 

    	 

    	 

    

 

EXHIBIT B

 

Supplement Number 1

 

Hereby made a part of Loan and Security
Agreement Number 1020

 

and Promissory Note Number 01

 

	DEBTOR:	QUANTUMSPHERE, INC., a Nevada corporation (“Debtor”)
	 	 
	LENDER:	NOVUS CAPITAL GROUP, LLC, a Delaware Limited Liability Company

 

This Supplement is
executed and delivered by Debtor pursuant to the terms of a Loan and Security Agreement Number 1020 between Debtor and Lender,
as the same may from time to time be amended, supplemented or otherwise modified (the “Agreement”). Capitalized terms
used herein shall have the respective meanings given them in the Agreement unless otherwise defined herein or unless the context
otherwise requires.

 

		1.	Debtor hereby affirms that (i) the representations and warranties set forth in Section 4 of the
Agreement are true and correct in all material respects as of the date hereof; and (ii) no Default or Event of Default has occurred
and is continuing.

 

		2.	Upon the funding thereof, Debtor hereby affirms that Lender will have made a Loan to it, which
Loan is evidenced by a Note, in the principal amount of Five Hundred Thousand Dollars and 00/100 ($500,000.00).

 

	LENDER:	 	DEBTOR:
	 	 	 	 	 
	NOVUS CAPITAL GROUP, LLC,	 	QUANTUMSPHERE, INC., 
	a Delaware limited liability company	 	a Nevada corporation
	 	 	 	 	 
	By: 	 	 	By: 	/s/ Kevin D. Maloney
	Name:   	 	 	Name:   	Kevin D. Maloney
	Title: 	 	 	Title: 	President and CEO
	Date: 	 	 	Date:	June 19, 2014

 

 

 

	Executable QSI Loan and Security Agreement	 	Page 17 of 18
	 	 	 
	Confidential	K.M.	  (signer’s initials)

 

    	 

    	 

    

 

SCHEDULE
TO LOAN AND SECURITY AGREEMENT NUMBER 1020

 

DESCRIPTION OF COLLATERAL:

 

All personal property of Debtor of every
kind, whether presently existing or hereafter created or acquired, and wherever located, including, but not limited to: accounts
receivable, notes receivable, contract rights, drafts, instruments and chattel paper, whether tangible or electronic, equipment,
machinery, furniture, fixtures, tools and supplies, inventory, general intangibles, deposit accounts, investment property, securities,
financial assets, customer lists, and the proceeds thereof. Collateral shall include copyrights, patents, trademarks, or goodwill
associated with trademarks of Debtor, and includes any proceeds arising from the disposition of any interest in the foregoing.

 

	LENDER:	 	DEBTOR:
	 	 	 	 	 
	NOVUS CAPITAL GROUP, LLC,	 	QUANTUMSPHERE, INC., 
	a Delaware limited liability company	 	a Nevada corporation
	 	 	 	 	 
	By: 	 	 	By: 	/s/ Kevin D. Maloney
	Name:   	 	 	Name:   	Kevin D. Maloney
	Title: 	 	 	Title: 	President and CEO
	Date: 	 	 	Date:	June 19, 2014

  

	Executable QSI Loan and Security Agreement	 	Page 18 of 18
	 	 	 
	Confidential	K.M.	  (signer’s initials)

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