NaturalNano,Inc. NaturalNanoResearch, Inc. 15 SchoenPlace Pittsford,New York ###-###-####

NaturalNano, Inc.

NaturalNano Research, Inc.

15 Schoen Place

Pittsford, New York ###-###-####

 

Platinum Long Term Growth IV, LLC

152 West 57th Street, 54th Floor

New York, New York 10019

Platinum Advisors LLC

152 West 57th Street, 54th Floor

New York, New York 10019

Longview Special Finance Inc.

Trident Chambers

P.O.Box 146

Road Town, Tortola,

British Virgin Islands

Ladies and Gentlemen:

NaturalNano, Inc. (the “Company”) is requesting the Senior Creditors’ consent to the issuance by the Company of a subordinate convertible promissory note in the aggregate principal amount of $225,000 (the “Junior Note”), convertible (subject to adjustment) at a conversion price of $.005 per share of Common Stock of the Company.  The Junior Note, and any agreements entered into in connection with the Note, shall provide that the Note shall be expressly subordinate, in right of payment and security, to all indebtedness of the Company (the “Senior Debt”) to Platinum Long Term Growth IV, LLC, Longview Special Finance Inc. and Platinum Advisors LLC (collectively, the “Senior Creditors”).  In connection with the issuance of the Junior Note, the Company is also issuing a Common Stock Purchase Warrant (the “Warrant”) to purchase 45,000,000 shares of the Company’s Common Stock at an initial exercise price of $.025 per share (subject to adjustment).

The Company covenants and agrees with the Senior Creditors that (i) it will not make, and will not permit any subsidiary to make, directly or indirectly, any payment in respect of the Junior Note or the Warrant (other than conversion or exercise of the same into Common Stock of the Company), whether in respect of principal, interest, redemption price or otherwise, until payment in full of the Senior Debt, whether or not the Senior Debt is then due and payable, or whether or not the Senior Creditors have agreed to forbear their remedies in respect thereof, (ii) the Junior Note shall provide that it is subordinate to the Senior Debt with respect to payment and security and (iii) any agreement purporting to grant to the holders of the Junior Note any lien on assets of the Company shall provide that the exercise of remedies with respect to such assets shall provide for the prior payment in full of all Senior Debt.  It is further agreed to by the Company that any default or event of default pursuant to the Junior Note shall be deemed to