VAPORCORP. BINDINGTERM SHEET FOR PROPOSED MERGER AND FINANCING TRANSACTIONS

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.

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.