QS Energy, Inc.

Item 3.02 Unregistered Sales of Equity Securities. From January 7, 2025, through June 16, 2025, Registrant (the “Company”), in a private offering (“Private Offering”), issued and sold to accredited US investors and non-U.S. investors an aggregate of $2,514,000 in principal amount Convertible Promissory Notes (the “Notes”) and warrants to purchase an aggregate of 31,423,615 shares of the Company’s common stock (the “Warrants”). The Company received proceeds from the closing of the Private Offering of $2,285,000, which funds were used, and are being used, for general corporate purposes and working capital including without limitation, the payment of salaries and professional fees, overhead and general administrative expenses, including payment of compensation to Cecil Bond Kyte in his roles as CEO and CFO of the Company, including payment to him of a retention bonus, as more fully described in our Form 8-K filed with the SEC on February 21, 2025. The Company has also paid and will pay, at its discretion, fees to finders for introductions which result in the purchase of our Notes and other of our securities. Fees for such introductions have been paid and will be paid by us from proceeds of the purchase price paid for such Notes in this Private Offering in an amount no greater than ten percent (10%) of the purchase price. The Notes are due twelve (12) months from their respective issuance dates (the “Maturity Date”). The Notes do not bear interest and were issued in the face amount equal to 110% of the purchasers’ commitments. The Notes are convertible into shares of the Company’s common stock at a rate of $0.08 per share. If the Notes are not paid in full by the Maturity Date, the balance remaining on the Maturity Date shall be increased by 10% and the Company shall be required to pay interest at a rate of 10% per annum thereon until all sums thereunder are paid in full or converted into the Company’s common stock. The Warrants are exercisable into shares of the Company’s common stock for a term of one (1) year from their respective issuance dates at an exercise price of $0.10 per share. The Warrants also contain provisions that protect the holders against dilution by adjustment of the conversion price in certain events involving a reduction or increase in the Company’s outstanding shares. The Private Offering was made to non-U.S. investors and to U.S. “accredited investors,” as the term is defined in Regulation D under the Securities Act of 1933, as amended (the “Securities Act”), and was made without general advertising or solicitation. The Notes sold in the Private Offering were not registered under the Securities Act, or the securities laws of any state, and were offered and sold in reliance on exemptions from registration including the exemption from registration afforded by Section 4(a)(2) of the Securities Act and Regulation S promulgated under the Securities Act, and corresponding provisions of state securities law, which, respectively, exempt transactions by an issuer not involving any public offering or transactions with non-U.S. Investors.