Document:

Exhibit 10.31

 

DISTRIBUTION AGREEMENT

 

 

This Distribution Agreement (the “Agreement”), is
made between XG Sciences, a corporation organized under the laws of the State of Michigan, United States of America (the “Company”)
and                         
                        
                             
(the “Distributor”).

 

WHEREAS the Company wishes to market the Products described
in Schedule A (the “Products”) through the Distributor, it is agreed as follows.

 

		1.	DEFINITIONS

 

When used in this Agreement the following terms shall have the
respective meanings indicated, such meanings to be applicable to both the singular and plural forms of the terms defined:

 

			“Affiliate” means any company controlled by, controlling, or under common control with Company. Affiliate
means any person, corporation or other entity: (i) which owns, now or hereafter, directly or indirectly 50% or more of any class
of the voting stock of Company or is, now or hereafter, directly or indirectly, in effective control of Company or (ii) 50% or
more of any class of the voting stock of which Company, or a party described in paragraph (i), owns, now or hereafter, directly
or indirectly, or of which Company, or a party described in paragraph (i) is now or hereafter, directly or indirectly, in control.

 

“Agreement” means this agreement,
the Schedules attached hereto and any documents included by reference as each may be amended from time to time in accordance with
the terms of the Agreement.

 

“Customer” means any person who
purchases Products from Distributor.

 

“Delivery Point” means the Company’s
facilities at Lansing, Michigan.

 

			“Products” means the products listed in Schedule A together with such other products and services as the
Company may, from time to time, designate in writing. Products may be deleted from or added to Schedule A and their specifications
and design may be changed by Company at its sole discretion at any time by notice to Distributor. Each change shall become effective
ninety (90) days following the date notice thereof is sent to Distributor.

 

“Schedule” means an exhibit attached
to this Agreement.

 

“Specifications” means those specifications,
if any, set forth in Schedule A.

 

“Territory” means the following
geographic area or areas: China.

 

		2.	APPOINTMENT OF DISTRIBUTOR

 

Company hereby appoints Distributor as Company’s nonexclusive
distributor of Products in the Territory, and Distributor accepts that position. It is understood that Company cannot lawfully
prevent its distributors located elsewhere from supplying Products for sale or use within the Territory and that it has no obligation
to do so.

 

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Distributor shall not solicit sales of Product or promote the
sale of Products outside the Territory. Distributor shall not establish an office or warehouse out the Territory for the sale of
Products.

 

		3.	DISTRIBUTOR’S DUTIES

 

		a.	The Distributor shall fully and adequately develop and promote the sale of the Products to Customers and prospective Customers
within the Territory.

 

		b.	The Parties acknowledge that there has been established and maintained over a period of many years the goodwill of the public
toward the Company. In order to maintain and further this goodwill, it is essential that the Distributor give prompt, effective
and courteous service to Customers. In all dealings with Customers and others, the Distributor shall conduct itself with the highest
standards of honesty, integrity and fair dealing.

 

		c.	The Company appoints the Distributor as the Company's authorized representative in the Territory for the Products, manufactured
by the Company or by any of its Affiliates, and the Distributor agrees to devote its best efforts and activities toward sale of
the Products in the Territory. The Distributor shall consider and treat the Company as the Distributor’s primary and preferred
vendor. The Distributor shall not during the term of the Agreement, sell products and services that directly compete with the Products.

 

		d.	The Distributor serves as the Distributor of the Company for the limited purposes of this Agreement, and owes the Company the
fiduciary and other obligations of an agent to its principle with respect to all actions taken on behalf of the Company. The Distributor
shall be authorized to act on behalf of the Company only as specified in this Agreement, and shall have no other authority, express,
apparent or implied. The Company and the Distributor acknowledge that their agency relationship arising from this Agreement does
not constitute or create a general agency, joint venture, partnership, employment relationship or franchise relationship between
them. In all advertising and dealings with customers and others, the Distributor shall conspicuously identify itself as an independent
business.

 

		e.	The mode, manner, method and means employed by the Distributor and the performance of the terms and conditions of this Agreement
shall be of the Distributor’s selection and under the sole control of the Distributor. The Distributor shall be responsible
for all risk incurred in the operation of the Distributor’s business and shall enjoy all the benefits thereof. Any person
employed by or contracting with the Distributor to perform any part of the Distributor’s obligations hereunder shall be under
the sole control and direction of the Distributor and the Distributor shall be solely responsible for all liabilities and expenses
thereof.

 

		f.	The parties acknowledge that personnel employed by the Distributor to perform services under this Agreement are not the employees
of the Company and the Distributor assumes full responsibility for their acts. The Distributor shall inform personnel employed
by the Distributor in writing that they are not entitled to the provisions of any of the Company's employee benefits. With respect
to the Distributor’ personnel, the Distributor shall have sole responsibility for supervision, daily direction and control.
The Distributor will pay all fees, compensation and bonuses to its employees and shall pay and process all checks, and payroll
records relating to same. The Company shall have no right or authority with respect to the control, direction, compensation, or
tenure of any employees of the Distributor. The Distributor shall have no authority whatsoever to engage or contract with any person
to be an employee or the representative of the Company. The Company will not be responsible for workers' compensation insurance,
disability benefits, unemployment insurance, withholding income taxes, Social Security or any other employee benefits for the Distributor’s
personnel.

 

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		4.	REFERRALS

 

If Company or any Affiliate is contacted by any party inquiring
about the purchase of Products in the Territory (other than Distributor or a party designated by Distributor), Company may at its
sole discretion, or may cause that Affiliate to, refer such party to Distributor for handling.

 

		5.	RELATIONSHIP OF PARTIES

 

		a.	Distributor is an independent contractor and is not the legal representative or agent of Company for any purpose and shall
have no right or authority (except as expressly provided in this Agreement) to incur, assume or create in writing or otherwise,
any warranty over any of Company’s employees, all of whom are entirely under the control of Company, who shall be responsible
for their acts and omissions.

 

		b.	Distributor shall, at its own expense, during the term of this Agreement and any extension thereof, maintain full insurance
under any Workmen’s Compensation Laws effective in the state or other applicable jurisdiction covering all persons employed
by and working for it in connection with the performance of this Agreement, and upon request shall furnish Company with satisfactory
evidence of the maintenance of such insurance.

 

		c.	Distributor accepts exclusive liability for all contributions and payroll taxes required under applicable law or other payments
under any laws or similar character in any applicable jurisdiction as to all persons employed by and working for it.

 

		d.	This is a nonexclusive Distribution Agreement during the period agreed among both the Company and the Distributor within the
Territory. The Company reserves the right to sell, bid upon, or quote the sale of Products, either directly or through its designated
agent to:

 

		i.	Any State, Local, National or Foreign Government, including their departments and agencies, inside or outside the Territory;

 

		ii.	Customers, for use of the Products in the Territory, where the Customer has its purchasing offices outside the Territory;

 

		iii.	In any territory other than that designated as the Territory of the Representative under this Agreement;

 

		iv.	To national accounts not doing business entirely within the Territory; and

 

		v.	To any Customer where the Company has been contacted by the Customer independently of the Representative.

 

		e.	Nothing contained in this Agreement shall be deemed to create any partnership or joint venture relationship between the parties.

 

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		6.	SALES

 

		a.	The Representative agrees to:

 

		i.	Maintain in the Territory such necessary facilities as the Company identifies from time to time to properly demonstrate, sell
and provide service to the market in the Territory;

 

		ii.	In a timely fashion, make such written reports relating to sales as the Company may from time to time reasonably require;

 

		iii.	Maintain in current condition all technical publications furnished by the Company in the recommended quantities;

 

		iv.	Provide each Customer with appropriate service and support for the Products sold by the Distributor;

 

		v.	Perform follow-up visits in accordance with sound business practices and submit such reports as may be prescribed by the Company
for a particular Product sold by the Distributor;

 

		vi.	Cooperate with the Company to promote the sale and service of Products, and perform at the Company's request delivery services
on Products sold by the Company for delivery to others in the Territory;

 

		vii.	Establish with the Company on an annual basis an acceptable development plan designed to accomplish an Annual Minimum Sales
Objectives that the Company shall identify on Schedule B, which the Company may amend annually in its sole discretion, and in fact
comply with the Annual Minimum Sales Objectives set forth on Schedule B.

 

		b.	The Distributor shall acquire and maintain, and assist the Company in acquiring and maintaining, all licenses, permits, certificates
of good standing, and other authorizations necessary and desirable to conduct the business contemplated by this Agreement. The
Distributor shall assist the Company in the proper handling of all documents and legal instruments related to the business contemplated
by this Agreement, as the Company may specify at times or as the circumstances may require, including without limitation the preparation,
procurement, execution of, delivery, and recording, where applicable, of all title documents, certificates of origin, manufacturers
statements of origin, certificates of title, bills of lading, receipts, security agreements, loan documents, financing statements,
consignment agreements, negotiable instruments, and commercial paper.

 

		c.	The Distributor agrees to support all Products sold by the Distributor by providing the appropriate technical support to all
Customers.

 

		d.	The Distributor shall deliver the Company's "limited warranty," as identified or revised by the Company from time
to time in its sole discretion, to the Customer at such time and in such a manner as the Company shall direct. The limited warranty
shall be in lieu of all other warranties of the Company, express or implied, and neither the Distributor nor any other person is
authorized to assume for the Company any additional obligations nor give any other warranty, express or implied, in connection
with the sale, lease, or use of Products hereunder.

 

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		7.	COMPENSATION AND EXPENSES

 

		a.	The Distributor shall bear all expenses of performing the obligations assumed by the Distributor under this Agreement, including
without limitation, those specified in Section 6.

 

		b.	The general compensation plan for the Distributor is detailed in Schedule A as it may be modified from time to time. The parties
agree that the Distributors commissions arising out of the sales activity contemplated by Agreement are intended to fully compensate
the Distributor for all activities performed hereunder, and the Distributor shall have no right of reimbursement from the Company
for costs incurred in performing under this Agreement.

 

		8.	TERMS OF PURCHASE AND SALE OF PRODUCTS

 

		a.	Distributor shall purchase its requirements for the Products from Company. Such requirements shall include (i) purchasing and
maintaining an inventory of Products that is sufficient to enable Distributor to perform its obligations hereunder, and (ii) at
least one (1) demonstration model of the Products.

 

		b.	Each order for Products submitted by Distributor to Company shall be subject to the written acceptance of Company, and Company
may, in its own discretion, accept or reject any order for Products without obligation or liability to Distributor by reason of
its rejection of any such request.

 

		c.	Company shall supply to Distributor sufficient Products to enable Distributor to meet the full demands for Products in the
Territory.

 

		d.	All orders for Products transmitted by Distributor to Company shall be deemed to be accepted by Company at the time such orders
are received by Company to the extent that they are in compliance with the terms of this Agreement and Company shall perform in
accordance with all accepted orders. Company shall confirm its receipt and acceptance of each order within 3 business days of receipt
of the order.

 

		e.	All Products purchased by Distributor shall be purchased solely for commercial resale or lease, excepting those Products reasonably
required by Distributor for advertising and demonstration purposes.

 

		9.	ORDER PROCEDURE

 

		a.	Each order for Products issued by Distributor to Company under this Agreement shall identify that it is an order and shall
further set forth the delivery date or dates and the description and quantity of Products which are to be delivered on each of
such dates. An order for Products shall not provide a delivery date less than thirty (30) days after the date that order is delivered
to Company.

 

		b.	The individual contracts for the sale of Products formed by Distributor’s submission of orders to the Company pursuant
to the terms and conditions hereof shall automatically incorporate, to the extent applicable, the terms and conditions hereof,
shall be subject only to those terms and conditions and shall not be subject to any conflicting or additional terms included in
any documents exchanged in connection therewith.

 

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		10.	CANCELLATION OF ORDERS

 

		a.	All cancellation of orders by Distributor shall be in writing, or if not initially in writing, shall be confirmed in writing.

 

		b.	If Distributor cancels an order, which has been accepted by Company, Distributor shall reimburse Company for any cost incident
to such order incurred by Company prior to the time it was informed of the cancellation.

 

		11.	PURCHASE PRICE

 

		a.	The prices for Products, and any discounts applicable thereto, are set forth in Schedule A. All prices are F.O.B. the Delivery
Point.

 

		b.	If the price for any Product is not set forth in Schedule A and Distributor nevertheless orders such Product from Company,
the Parties hereby evidence their intention thereby to conclude a contract for the sale of that Product at a reasonable price to
be determined by the Parties mutually negotiating in good faith.

 

		12.	PRICE CHANGES

 

		a.	Company reserves the right, in its sole discretion, to change prices or discounts applicable to the Products. Company shall
give written notice to Distributor of any price change at least thirty (30) days prior to the effective date thereof.

 

		b.	The price in effect as of the date of Distributor’s receipt of notice of such price shall remain applicable to all orders
received by Company prior to that effective date.

 

		13.	PACKING

 

		a.	Company shall, at its expense, pack all Products in accordance with Company’s standard packing procedure, which shall
be suitable to permit shipment of the Products to the Territory; provided, however, that if Distributor requests a modification
of these procedures, Company shall make the requested modification and Distributor shall bear any reasonable expenses incurred
by Company in complying with such modified procedures which are in excess of the expenses which Company would have incurred in
following its standard procedures.

 

		14.	DELIVERY: TITLE AND RISK OF LOSS

 

		a.	All deliveries of Products sold by Company to Distributor pursuant to this Agreement shall be made F.O.B. the Delivery Point,
and title to and risk of loss of Products shall pass from Company to Distributor at the Delivery Point. Distributor shall be responsible
for arranging all transportation of Products, but if requested by Distributor, Company shall, at Distributor’s expense, assist
Distributor in making such arrangements.

 

		b.	Distributor shall also procure insurance for the transportation of the Products, and such insurance shall be of a kind and
on terms current at the port of shipment. In the event that Company is requested to assist Distributor in arranging for transportation,
Distributor shall reimburse Company for all costs applicable to the Products following their delivery to Distributor, including,
without limitation, insurance, transportation, loading and unloading, handling and storage.

 

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		c.	Distributor shall pay all charges, including customs duty and sales tax, incurred with respect to the Products following their
Delivery to the carrier or forwarder.

 

		15.	INSPECTION AND ACCEPTANCE

 

		a.	Promptly upon the receipt of a shipment of Products, Distributor shall examine the shipment to determine whether any item or
items in the shipment are in short supply, defective or damaged.

 

		b.	Within fifteen (15) days of receipt of the shipment, Distributor shall notify Company in writing of any shortages, defects
or damage which Distributor claims existed at the time of delivery.

 

		c.	Within thirty (30) days of after the receipt of such notice, Company will investigate the claim of shortages, defects or damage,
inform Distributor of its findings, and deliver to Distributor Products to replace any which Company determines, in its sole discretion,
were in short supply, defective or damaged at the time of delivery.

 

		16.	PAYMENT

 

		a.	Upon deliverance and acceptance of Products, Company must submit to Distributor Company’s invoice for those products.
Distributor shall pay each such proper invoice within thirty (30) days after Distributor’s receipt of that invoice.

 

		b.	Payment shall be made in US Dollars to a bank account to be notified in writing by Company to Distributor.

 

		17.	ADVERTISING

 

The Distributor agrees to:

 

		a.	Advertise the Products in a manner acceptable to the Company and consistent with the manner in which the Company advertises
for its own sales;

 

		b.	Maintain and provide to the Company upon request current records of the names and addresses of, and mail advertising literature
frequently sent to prospective purchasers and others who may influence purchases of Products in the Territory;

 

		c.	Maintain records of such mailings; and

 

		d.	Adhere to advertising guidelines provided by the Company regarding proper promotion of the Company and Product image and, at
the request of the Company, cease any practice or advertising or promotional activity deemed by the Company to be detrimental to
such image.

 

		18.	RECORDS AND REPORTS

 

The Distributor shall provide the Company, on a quarterly basis,
with a regular forecast of the sales expected to be made in the Territory during the next two (2) succeeding quarters. The Distributor
shall further provide the Company with periodic updates on the progress of customers, competitive information, and other reasonable
information on a regular basis.

 

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		19.	USE OF NAME, TRADEMARKS, TRADE NAMES and PATENTS

 

		a.	"Marks" are defined as trademarks, service marks, trade names, service names, insignia, symbols, logos, decorative
designs and other intellectual property and identifying indicia, and accompanying good will, that the Company owns or is licensed
or sub-licensed to use which the Company, in its sole discretion, determines the Representative is licensed to use.

 

		b.	Subject to the terms and conditions of this Agreement, the Company hereby grants to the Distributor a non-exclusive, non-transferable
license to use, promote and market within the Territory, only, during the term of this Agreement, those Marks specified by the
Company in writing, from time to time. The Distributor acknowledges the Company's exclusive right, title, and interest, as between
them, in and to the Marks and accompanying good will, and agrees that it will not at any time do or cause to be done any act or
thing contesting or in any way impairing or intended to impair any part of the Company's right, title, and interest in or to the
Marks. The Distributor shall not in any manner represent that it has any ownership in the Marks, and the Distributor acknowledges
that use of the Marks shall not create in the Distributor’s favor any right, title, or interest in or to the Marks but all
uses of the Marks by the Distributor shall inure to the benefit of the Company.

 

		c.	While it is not the intent of this subsection to expressly or impliedly grant control to the Company over the general operations
of the Distributor’s business, the Company retains the right to revoke the authority of the Distributor to use the Marks,
in whole or in part, in the event that the quality or nature of the services or products offered by the Distributor pursuant to
this Agreement shall be unsatisfactory to the Company. The Distributor will permit duly authorized representatives of the Company
to inspect and review, on the premises of the Distributor, at all reasonable times, the services and products with which the Marks
are used.

 

		d.	The rights granted in this Section 19 are personal to the Distributor and shall not be transferable by the Distributor in any
way without the Company's prior written consent.

 

		e.	The license granted by this Section 19 will terminate upon expiration or termination of this Agreement, or if, in the Company's
sole discretion, the Distributor’ continued use of any or all of the Marks will be harmful to the Company. Upon the termination
of this license, the Distributor shall immediately cease and desist all use of the Marks, and shall tender or return all materials
bearing the Marks to the Company.

 

		f.	The Company assumes no liability to the Distributor or to third parties with respect to the services and products provided
by the Distributor in connection with the Marks and the Distributor hereby indemnifies and holds harmless the Company against all
losses, damages and expenses, including attorney's fees, as the result of or related to claims of third persons involving services
and products provided by the Distributor. By way of example, and without limiting the generality of the foregoing, this indemnity
shall apply to claims by third persons against the Company arising from misrepresentations by the Distributor, it's agents or employees,
concerning the Company's or the Distributor’s business whether such misrepresentations are intentional or unintentional.

 

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		20.	CONFIDENTIAL INFORMATION

 

		a.	Any specifications, drawings, sketches, models, samples, data, computer programs or documentation, price lists, parts catalogs,
operator's manuals, directories, sales and service bulletins, parts and service manuals or technical or business information ("Confidential
Information") furnished or disclosed by either Party to the other Party hereunder shall be deemed the exclusive property of
the providing Party, including the right to copyright all copyrightable material, and, when in tangible form, shall be returned
to the providing Party upon expiration or termination of this Agreement. Unless Confidential Information was previously known to
the receiving Party free of any obligation to keep it confidential, or has been or is subsequently made public by the providing
Party, it shall be used only for the purposes hereunder, and may not be used for other purposes. Customer lists, Customer sales
histories and related information and data ("Customer Information") are the exclusive property of the Company and are
to be used by the Representative solely in the performance of its obligations and duties as described herein, kept confidential,
and returned to the Company, at the Company's expense, upon the expiration or termination of this Agreement.

 

		b.	If the Distributor is served with process to obtain access to Confidential or Customer Information, the Representative shall
immediately notify the Company, which shall, in addition to the Distributor’s efforts, if any, have the right to seek to
quash such process. If the Company is precluded by a court or administrative body from appearing with respect to such process,
the Distributor shall take all steps possible and follow the Company's reasonable instructions to attempt to quash such process,
all at the Company's expense.

 

		21.	AGREEMENT CONFIDENTIAL

 

The Company and the Representative shall keep confidential the
terms and conditions of this Agreement.

 

		22.	DURATION OF AGREEMENT

 

The term of this Agreement shall begin on the Effective Date,
and shall automatically extend for one year unless not less than sixty (60) days prior to the expiration date, one party notifies
the other in writing of its intention not to renew this Agreement. Either party may decline to renew this Agreement in its sole
discretion. The right of non-renewal is separate, distinct and in addition to the right of termination set forth in Section 22.
All obligations and remedies which survive this Agreement shall apply regardless of whether the Agreement is not renewed, or terminated
for any reason.

 

		23.	TERMINATION

 

		a.	The Company shall have the right to terminate this Agreement at any time and for any reason given ninety (90) days notice to
the Distributor.

 

		b.	If one of the Parties materially breaches this Agreement and fails to cure such breach within sixty (60) days after
written notice thereof is delivered to the Party in default, the Party not in default may terminate this Agreement by delivering
to the Party in default written notice of intent to terminate this Agreement. Such termination shall be effective thirty (30) days
after delivery to the Party in default of written notice of intent to terminate.

 

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		c.	In addition to the rights of termination as set forth in Subsection 22.a, the Company shall have the right to terminate this
Agreement effective upon sixty (60) days written notice to the Representative if:

 

		i.	Regulatory approval empowering the Company or the Distributor to sell Products in the Territory is not granted to the Company
or the Distributor, is granted subject to terms and conditions unacceptable to the Company, or is granted under such terms and
conditions which, in the Company's opinion, materially affect the intended purpose of this Agreement.

 

		ii.	Regulatory restrictions or limitations on this Agreement are unacceptable to the Company; or

 

		iii.	In the opinion of the Company, the Distributor is failing to meet the Annual Minimum Sales Objectives for the current year
as set forth in Schedule B. Prior to terminating the Agreement under this Subsection 22.b.iii, the Company shall place the Distributor
in a probationary status for up to three (3) months, and shall work with the Distributor to identify the reasons for non-compliance
with Schedule B, and the necessary measures to obtain and maintain compliance therewith. Although the Company will act in good
faith to work with the Distributor to obtain and maintain compliance with Schedule B during the probationary period, where circumstances
warrant, the Company may determine in its sole discretion that the probation efforts set forth herein are not achieving the desired
and necessary effect, and the Company may thereafter at any time terminate this Agreement upon sixty (60) days notice.

 

		d.	Further, in addition to the rights of the Parties to terminate this Agreement as set forth above, a Party shall have the right
to terminate this Agreement, effective immediately upon written notice, if:

 

		i.	The other Party makes an assignment for the benefit of creditors.

 

		ii.	An Order For Relief under Title 11 of the United States Code is entered by any United States Court by or against the other
Party.

 

		iii.	A trustee or receiver over all or any substantial part of the other Party's assets is appointed by any Court.

 

		iv.	The other Party (i) has made any material misrepresentation or omission to the non-offending Party in establishing this limited
agency relationship or in the conduct of business pursuant to this Agreement or is convicted of or pleads no contest to a felony
or other crime or offense that is likely to adversely affect the reputation of the other Party, the non-offending Party, or their
affiliated companies or the goodwill of the Marks (the determination of which shall be solely in the discretion of the Company);
(ii) misrepresents the terms, rates, capabilities or features of the Products to any person; (iii) attempts to make an unauthorized
assignment of this Agreement; or (iv) receives a notice of violation of the terms or conditions of any license or permit required
by the other Party or its employees in the conduct of the business contemplated by this Agreement and fails to correct such violation
within the time period specified in such notice.

 

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		e.	No waiver by the non-offending Party of any breaches or deficiencies in one or more instances shall constitute a waiver of
that Party's right to terminate this Agreement in subsequent instances.

 

		24.	TERMINATION OR EXPIRATION OBLIGATIONS

 

		a.	Upon termination or expiration of this Agreement:

 

		i.	The Distributor shall: (i) not thereafter use any Mark or any actual or similar trade name, copyright, service mark, trademark,
service name, logo, insignia, symbol, decorative design or other identifying indicia theretofore used by the Distributor specifically
in the conduct of its business, in any manner or for any purpose; and will not utilize for any purpose any mark or other trademark,
trade name, service mark, service name, or other intellectual property or commercial symbol or logo that suggests or indicates
a connection or association with the Company or any affiliate of the Company; or directly or indirectly, at any time or in any
manner, identify itself or any business as associated with the Company or an affiliate of the Company in the Territory; (ii) return
to the Company, at the Company's expense, all advertising and marketing materials, forms, and other materials containing any Mark
or otherwise identifying or relating to the Company's business. The Distributor shall retain no copy of any such information.

 

		ii.	The Company shall have the right to take full responsibility for any or all unfilled orders submitted by the Distributor and
to charge against any amounts due from the Company to the Distributor all such reasonable costs as are necessary to complete the
order, including, but not limited to, preparation and delivery of the Products, training of the customer personnel, and purchasing
and delivery of supplied equipment.

 

		b.	The consummation of any transaction of a type covered by this Agreement by mutual consent after the expiration or termination
thereof shall, unless otherwise agreed in writing, be governed by the applicable provision of this Agreement but shall not be construed
as reviving this Agreement or as in any way modifying the effectiveness of such expiration or prior termination.

 

		c.	The expiration or termination of this Agreement shall not affect the liability of one party to the other on account of business
previously consummated, and settlement therefor shall be upon the same basis as if this Agreement had not expired or been terminated.

 

		25.	AGREEMENT CHANGES

 

		a.	This Agreement and the attached Schedules (which are an integral part of this Agreement) represent the entire understanding
between the Parties with respect to the matters contained herein and therein, and there are no other agreements, written or oral,
that may in any manner alter, enlarge, abridge or conflict with the terms hereof or thereof. Except as specifically provided herein,
this Agreement may not be amended, enlarged or abridged except by a writing specifying that it is a supplement or amendment hereof,
executed with the same formality as this Agreement.

 

		b.	This Agreement supersedes any previous contracts, if any, whether written or oral, between the Company and the Representative
with respect to the matters contained herein.

 

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		26.	ASSIGNMENT

 

The Company is relying on the financial stability, integrity
and management resources of the Distributor in performance of this Agreement. This Agreement cannot be assigned, sold, bartered,
traded or otherwise transferred, either in part or in whole by the Distributor without the prior written consent of the Company.
Further, the Distributor may not delegate any part of its obligations hereunder (including any delegation to a branch or subsidiary)
without the prior written consent of the Company.

 

		27.	SEVERABILITY

 

Any provision of this Agreement which is judged invalid or unenforceable
shall be deemed inoperative without invalidating such provision elsewhere or any of the other provision(s) of this Agreement, unless
omission of such provisions substantially alters the economic relationship between the parties. In such latter case, the Company,
at its option, may terminate this Agreement as soon thereafter as the Company may determine.

 

		28.	ARBITRATION AND CHOICE OF LAW

 

		a.	In the case of any claim or dispute between the parties related to this Agreement that cannot be settled by mutual agreement,
the claim or dispute shall be submitted to final, non-appealable arbitration in accord with the commercial rules of the American
Arbitration Association, at such place or places as the parties hereto may agree and if they fail to agree, then the arbitration
shall be held at the principal place of business of the Company.

 

		b.	This entire Agreement shall be governed by the laws of the State of Michigan, and the decision of the Arbitrators shall be
rendered in accord therewith. The costs of the arbitration shall be borne by the parties in such proportion and manner as may be
provided in the arbitration award.

 

		29.	TAXES, LEVIES AND OTHER CHARGES

 

All levies, taxes, excises or other similar charges, current
or future, that may be levied, assessed or imposed by any governmental authority upon Products purchased hereunder, or imposed
thereof, or assessed at any time on account of this Agreement; or any note, or other documents arising out of performance of this
Agreement, shall be borne by the Representative. In the event the Distributor fails to pay any such charges, the Company may pay
the same, and such amounts shall be deemed conclusive as to the amounts legally due, and may be billed separately to the Distributor,
payable on demand, or added to the invoice price of Products, at the Company's option.

 

		30.	NOTICES

 

All notices which are required or which may be given hereunder
shall be in writing and shall be deemed to be given:

 

		a.	On the date delivered if delivered in person or by messenger,

 

		b.	On the date sent if sent by telex, electronic mail or by registered or certified mail, postage prepaid, or

 

    	Distribution Agreement	Page 12

     

    

 

		c.	Seven (7) days after mailing if sent by 1st class mail, postage prepaid.

 

Notice must be delivered or sent to the address of
the Party set forth below or to such other address as the Party has specified by notice:

 

		d.	If to Distributor:

 

		e.	If to Company:

 

Any changes in address shall be sent in writing to
the other Party.

 

		31.	SIGNATURE

 

IN WITNESS WHEREOF, the Parties affix their signatures by their
duly authorized representatives.

 

The Distributor:

 

	 	By	 	 
	 	 	 	 
	 	Title	 	 
	 	 	 	 
	 	Date	 	 

 

The Company:

 

	 	By	 	 
	 	 	 	 
	 	Title	 	 
	 	 	 	 
	 	Date	 	 

 

    	Distribution Agreement	Page 13

     

    

 

SCHEDULE A

 

The following provisions regarding Products
and territory are supplementary to the Distribution Agreement between XG Sciences, Inc. (the "Company") and _____________________
("the Distributor").

 

		1.	PRODUCTS

 

		·	Bulk graphene nanoplatelets

 

		·	Mixtures of graphene nanoplatelets and other materials

 

		·	Graphene nanoplatelet-based paper products that are typically embodied by the XG Leaf product line

 

		2.	SPECIFICATIONS

 

Details specified for the Products concerning weight,
dimensions, speed, performance, consumption, etc., are intended as approximate and are not binding upon the Company.

 

		a.	The Company reserves the right at any time, and without notice, to effect modifications in construction of the Products.

 

		b.	The Company reserves the right to discontinue the manufacture of any model or to make changes at any time in the design of,
and to add any improvement to the Products covered under this Agreement without incurring any obligation whatsoever to the Distributor,
whether or not orders therefor have been previously accepted or approved.

 

		c.	The Parties, recognizing the importance of Product performance and safety, agree that no modification or alteration of any
Product shall be made by the Distributor that affects such performance or safety without the prior written consent of the Company.

 

		3.	DAMAGES OR INJURIES

 

		a.	The Distributor will indemnify and save the Company harmless from all loss, damage, costs and expenses, including attorney’s
fees and warranty, arising from or in any way connected with an injury to person or damage to property, to the extent that such
loss, costs or expenses, directly or indirectly, from a violation of Article 2.c of this Schedule or the possession, use or operation
of Products, including demonstration or display, either by the Distributor or a Customer.

 

		b.	In order to enable the Company to service properly all claims involving the Products the Distributor agrees to promptly:

			

    	Distribution Agreement	Page 14

     

    

 

		i.	report to the Company all accidents that come to its attention involving the Products, particularly in cases of personal injury
or death;

 

		ii.	use best efforts to keep the equipment allegedly involved in an accident in the same condition as when the accident occurred
for a reasonable time, to allow the Company an opportunity to test and inspect it;

 

		iii.	allow the Company to test and inspect the equipment involved in any accident, at the Company’s expense; and

 

		iv.	use best efforts to prevent destructive testing of the equipment by others until the Company has had an opportunity to test
it.

 

		4.	PRICES

 

		a.	The prices for Products purchased by the Distributor for resale will be the Company’s published list prices in effect
at the date of sale, discounted by 20%, except in the case the Distributor and the Company have agreed in writing on price modifications.

 

		b.	The prices for Products sold by the Distributor to the customer in the Territory and billed directly to customers must be at
least equal to the Company’s published list prices, except in case the Distributor and the Company have agreed in wiring
on price modifications.

 

		c.	The Company reserves its right at any time to change its prices, F.O.B. points designated in price lists, or discounts applicable
to any or all of the Products within the scope of this Agreement, without prior notice.

 

		5.	COMMISSION SCHEDULE

 

The following commissions will be paid on orders
received from customers that are developed by Distributor in the Territory, as outlined in Section 7 of this Agreement.

 

	Revenue	 	<$50K	 	 	$50K - $99K	 	 	$100K -

$249K	 	 	$250K -

$499K	 	 	$500K -
 $1 million	 	 	>$1 million	 
	New Account – First Year	 	 	8	%	 	 	8	%	 	 	6	%	 	 	5	%	 	 	5	%	 	 	4	%
	Follow-up Years	 	 	4	%	 	 	4	%	 	 	4	%	 	 	3	%	 	 	3	%	 	 	3	%

 

    	Distribution Agreement	Page 15

     

    

 

For purposes of Commission determination, the following
definitions apply:

 

“Customer” means any entity in the Territory
that purchases product directly from the Company, for delivery within the Territory, and for which the Distributor has been assigned
in writing by the Company as the local Distributor.

 

“New Account – First Year” means
the 12 month period following the receipt of the first order from a Customer that has not previously ordered product from the Company.

 

“Follow-up Years” means the time period
after expiration of the New Account – First Year.

 

“Order” means the sum total of a customer’s
purchase commitments as communicated to the Company. If a customer places a blanket order for a large amount, with delivery releases
for lesser amounts on a scheduled or unscheduled basis, the Order for purposes of this calculation will be the amount of the total
blanket order.

 

Commissions on sales orders will be calculated based
on the size of the individual order. For example, if a customer orders $100K per month for 10 months in a row, the commission amount
of 6% would be earned on each of the individual orders. If a customer places an order for $1 million, to be shipped at the rate
of $100K per month, the commission would be calculated on the total $1 million order.

 

Commissions on any order will be due to the Distributor
at the time of collection from the Customer, and Company will forward such commissions to the Distributor within 30 days of receipt
of customer payment.

 

    	Distribution Agreement	Page 16

     

    

 

SCHEDULE B

 

The following provisions regarding Products
and territory are supplementary to the Distribution Agreement between XG Sciences, Inc. (the "Company") and _____________________
("the Distributor").

 

Annual Minimum Sales Objectives

 

    	Distribution Agreement	Page 17Exhibit 10.32

 

 

XG SCIENCES, INC.

 

SUBSCRIPTION AGREEMENT

 

FOR ACCREDITED INVESTORS UNDER REGULATION
D

 

THE SECURITIES HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF ANY U.S. STATE OR ANY OTHER JURISDICTION. THERE ARE FURTHER RESTRICTIONS
ON THE TRANSFERABILITY OF THE SECURITIES DESCRIBED HEREIN.

 

THE PURCHASE OF THE SECURITIES INVOLVES
A HIGH DEGREE OF RISK AND SHOULD BE CONSIDERED ONLY BY ACCREDITED INVESTORS WHO CAN BEAR THE RISK OF THE LOSS OF THEIR ENTIRE INVESTMENT.

 

Ladies/Gentlemen:

 

Pursuant to a Confidential
Private Placement Memorandum dated April 18, 2015 (the “PPM”), XG Sciences, Inc., a Michigan corporation (the
“Company”) is selling in this offering (this “Offering”) up to $18,000,000 in units (“Units”).
Each Unit shall consist of (i) one share of the Company’s Series B convertible preferred stock, no par value per share (the
“Series B Preferred Stock”) which shall be convertible into shares of the Company’s common stock, no par
value per share (“Common Stock”), and (ii) subject to the terms herein and in the PPM, corresponding warrants
in the form of Exhibit D hereto (“Warrants” and together with the Series B Preferred Stock, the “Securities”)
to purchase Common Stock, and is being offered at a price of $16 per Unit, to persons who are “accredited investors”
as such term is defined in Regulation D promulgated under the Securities Act of 1933, as amended (the “Securities Act”).
The Company reserves the right to increase or decrease the amount of the Offering at its sole discretion. The Series B Preferred
Stock have the rights and preferences which are set forth in the Certificate of Designations of Series B Convertible Preferred
Stock, a copy of which is attached hereto as Exhibit A (the “Certificate of Designations”).

 

		1.	Subscription.

 

1.1           The
undersigned hereby subscribes for the number of Securities set forth on the signature page below at a purchase price of $16.00
per Unit. The undersigned acknowledges and agrees that the Company will only issue Warrants to purchase Common Stock, at a strike
price of $16/share, in amounts as listed below to those investors who meet the criteria below, provided that investors may only
qualify for one criteria at the time of funding of their investment (i.e., not two or three of such criteria):

 

		·	85% Warrant coverage will be granted to those investors who consummate an investment in Series
B Preferred Stock prior to 5:00 PM ET on Thursday, April 30, 2015;

 

		·	50% Warrant coverage will be granted to those investors who consummate an investment in Series
B Preferred Stock prior to 5:00 PM ET on Tuesday, June 30, 2015; and

 

		·	15% Warrant coverage will be granted to those investors who consummate an investment in Series
B Preferred Stock prior to 5:00 PM ET on Monday, August 31, 2015.

 

Thus, the number of
shares of Common Stock issuable in any Warrant will be determined by multiplying the applicable Warrant coverage percentage by
the number of shares of Series B Preferred Stock purchased by an investor. Such Warrants will have a seven (7) year term and will
contain a provision that allows for a net exercise of the Warrants by the holder and that to the extent any of such warrants are
“in the money” at expiration, the Company will automatically effect a “net exercise” of such Warrants on
behalf of the holder. The Company reserves the right to alter this Warrant coverage at any time in its discretion. 

 

    	 	Page 1	 

     

    

 

1.2           If
the undersigned is paying with a check or money order, enclosed is a check or money order payable to the order of XG Sciences,
Inc., in the amount set forth on the signature page below as payment in full of the total purchase price of the Securities
subscribed for.

 

1.3           If
the undersigned in paying by wire transfer, the understand shall effect a wire transfer in the amount set forth on the signature
page below as payment in full of the total purchase price of the Securities subscribed for to the bank account set forth in and
in accordance with the wire instructions detailed in Exhibit B.

 

1.4           The
subscription amount tendered by the undersigned will be deposited by the Company into a non-interest bearing account when received.

 

1.5           The
Company expects to utilize the subscription funds received from this Offering to expand capacity and invest in capital equipment.
The remaining funds will be used to fund general Company operations and may be spent for salaries and wages, sales and marketing,
research and development, or general corporate purposes as determined by management.

 

		2.	Subscriber’s Acknowledgments and Agreements.

 

The undersigned understands,
acknowledges and agrees that:

 

2.1           This
subscription may be accepted or rejected in whole or in part by the Company, in its sole discretion. The Company may also terminate
the Offering at any time, and may increase or decrease the size of the Offering at its sole discretion.

 

2.2           Except
as provided under applicable securities laws, this subscription is and shall be irrevocable except that (a) the undersigned’s
execution and delivery of this Subscription Agreement will not constitute an agreement between the Company and the undersigned
until this Subscription Agreement is accepted on behalf of the Company and, if not so accepted, the undersigned’s subscription
and obligations hereunder will terminate and (b) the undersigned can, at any time prior to acceptance of this Subscription Agreement,
request in writing that the undersigned be released from the obligations hereunder (and the Company may, but need not, in its discretion,
elect to release the undersigned from the subscription and from such obligations).

 

2.3           No
U.S. federal or state agency has made any finding or determination as to the fairness of the terms of this Offering. These Securities
have not been recommended or endorsed by any U.S. federal or state securities commission or regulatory agency.

 

2.4           (a)
the Securities have not been registered under the Securities Act, or applicable U.S. state securities laws, (b) the Securities
are deemed to be “restricted securities” under the Securities Act and applicable U.S. state securities laws and (c)
the purchase of the Securities is taking place in a transaction not involving a public offering or persons that are not accredited
investors. Furthermore, the undersigned is aware that any resale inconsistent with the Securities Act may create liability on the
undersigned’s part and/or the part of the Company, and agrees not to assign, sell, pledge, transfer or otherwise dispose
of or transfer any such Securities unless registered under the Securities Act and applicable U.S. state securities laws, or an
opinion is given by counsel satisfactory to the Company that such registration is not required.

 

2.5           The
undersigned acknowledges and agrees that there can be no assurance that there will be any market for the Securities in the foreseeable
future, and that, as a result, the undersigned must be prepared to bear the economic risk of his investment for an indefinite period
of time.

 

    	 	Page 2	 

     

    

 

2.6           The
Company has made available to the undersigned (a) the Company’s Articles of Incorporation and Bylaws, each as amended to
date (collectively, the “Company Organizational Documents”), (b) the Shareholder Agreement dated March 18, 2013
(the “Shareholder Agreement”), (c) the Voting Agreement dated January 15, 2014 (the “Voting Agreement”),
(d) the Certificate of Designations, (e) the Warrant and (f) the PPM. The undersigned also acknowledges that the undersigned has
had a reasonable opportunity to examine the Company Organizational Documents, the Shareholder Agreement, the Voting Agreement,
the Certificate of Designations, the Warrant and the PPM. The undersigned further acknowledges and agrees that the undersigned
will be bound by the Company Organizational Documents, the Shareholder Agreement, the Voting Agreement, the Certificate of Designations,
the terms of the Warrant (if one is issued) and the PPM. 

 

		3.	Subscriber’s Representations and Warranties.

 

The undersigned hereby
represents and warrants as follows:

 

3.1           The
undersigned is acquiring the Securities for the undersigned’s own account for investment, not for the interest of any other
person, not for resale to any other person and not with a view to or in connection with a sale or distribution.

 

3.2           All
information furnished in the Investor Questionnaire, in the form of Exhibit C attached hereto, completed by the undersigned
is true and correct in all respects.

 

3.3           The
undersigned’s overall commitment to investments that are not readily marketable is not disproportionate to the undersigned’s
net worth and the undersigned’s investment in the Company will not cause such overall commitment to become excessive. The
undersigned has adequate net worth and means of providing for current needs and personal contingencies to sustain a complete loss
of the undersigned’s investment in the Company, and the undersigned has no need for liquidity in this investment.

 

3.4           The
undersigned has sufficient knowledge and experience in financial and business matters so that he/she is capable of evaluating the
merits and risks of an investment in the Securities and of protecting his or her interests in connection with such investment,
or he/she has obtained the advice of an attorney, a certified public accountant, or an investment advisor registered under the
Investment Advisors Act of 1940 or under the Michigan Uniform Securities Act of 2002, with respect to the merits and risks of an
investment in the Securities and the protection of his interests.

 

3.5           The
undersigned has had an opportunity to ask questions of and receive answers from representatives of the Company with respect to
this Offering. The Company has provided the undersigned with all documents requested and has provided answers to all of the undersigned’s
questions relating to an investment in the Company. In addition, the undersigned has had an opportunity to discuss this investment
with representatives of the Company and to ask questions of them.

 

3.6           The
undersigned is acquiring the Securities and has been furnished with the Company Organizational Documents (as amended to date),
the Shareholder Agreement, the Voting Agreement, the Certificate of Designations, the Warrant and the PPM. The undersigned has
not been furnished with any prospectus or other offering literature.

 

3.7           The
undersigned understands that an investment in the Company is speculative and involves a high degree of risk, and the undersigned
has carefully reviewed and is aware of all of the risk factors related to the purchase of the Securities.

 

3.8           The
undersigned understands that there is no market for the Securities, and it is not anticipated that such a market will develop.

 

3.9           If
this Subscription Agreement is executed and delivered on behalf of a partnership, trust, corporation or other entity: the undersigned
has been duly authorized to execute and deliver this Subscription Agreement, the Investor Questionnaire, and all other documents
and instruments (if any) executed and delivered on behalf of such entity in connection with its purchase of Securities subscribed
for.

 

    	 	Page 3	 

     

    

 

3.10         The
Company and the other purchasers are relying on the truth and accuracy of the declarations, representations and warranties herein
made by the undersigned. Accordingly, the foregoing representations and warranties and undertakings are made by the undersigned
with the intent that they may be relied upon in determining his/her suitability as a purchaser. The undersigned agrees that such
representations and warranties shall survive the acceptance of the undersigned as a purchaser, and the undersigned indemnifies
and agrees to hold harmless, the Company and each other purchaser from and against all damages, claims, expenses, losses or actions
resulting from the untruth of any of the warranties and representations contained in this Subscription Agreement.

 

3.11         The
foregoing representations and warranties are true as of the date of this Subscription Agreement and shall be true as of the date
the Company issues and sells Securities to the undersigned. If such representations and warranties shall not be true in any respect
prior to such date, the undersigned will give prompt written notice of such fact to the Company.

 

4         Certificates.
The undersigned agrees that each certificate representing the Securities shall be stamped or otherwise imprinted with a legend
substantially in the following form (in addition to any legend required by applicable state securities or “blue sky”
laws):

 

“THESE
SECURITIES REPRESENTED BY THIS CERTIFICATE (THE “SECURITIES”) HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”) OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE
DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER APPLICABLE STATE SECURITIES LAWS OR THE ISSUER SHALL HAVE RECEIVED
AN OPINION OF COUNSEL THAT REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE
SECURITIES LAWS IS NOT REQUIRED.”

 

		5	Registration Rights; Exchange Right.

 

5.1           The
Company will use its best efforts to (a) file a registration statement on Form S-1 with the U.S. Securities and Exchange Commission
(“SEC”) to register shares of Common Stock (a “Registration Statement”) within (6) months
of the last closing (“Closing”) of this offering (the “Registration Timeframe”), provided,
however, such Registration Timeframe may be extended to (a) twelve (12) months in the event the Company raises at least $5,000,000
and up to $9,999,999 from Strategic Corporate Partners (as defined below) in this Offering, and (b) eighteen (18) months in the
event the Company raises at least $10,000,000 from Strategic Corporate Partners in this Offering, and (b) list its Common Stock
on a Qualified National Exchange (as defined in the Certificate of Designations) within ninety (90) days following the Registration
Statement being declared effective by the SEC. A “Strategic Corporate Partner” is an investor in this Offering
that has at least $100 million of annual revenue and has evidenced a desire to enter into a commercial relationship with the Company.

 

5.2           Commencing
six (6) months following the listing of the Common Stock on a Qualified National Exchange, the Company shall be obligated to notify
the holder of Registrable Securities (as defined below) in writing at least ten (10) days prior to the filing of any registration
statement under the Securities Act for purposes of a public offering of securities of the Company (including, but not limited to,
registration statements relating to secondary offerings of securities of the Company, but excluding any registration statement
relating to any employee benefit plan or with respect to any corporate reorganization or other transaction under Rule 145 of the
Securities Act) and will afford each such holder an opportunity to include in such registration statement all or part of such Registrable
Securities held by such holder. Each holder of Registrable Securities desiring to include in any such registration statement, all
of part of the Registrable Securities held by it shall, within ten (10) days after the above-described notice from the Company,
so notify the Company in writing. Such notice shall state the intended method of disposition of the Registrable Securities held
by such holder. If a holder decides not to include all of its Registrable Securities in the registration statement thereafter filed
by the Company, such holder shall nevertheless continue to have the right to include any Registrable Securities in any subsequent
registration statement or registration statements as may be filed by the Company with respect to offerings of its securities, all
upon the terms and conditions set forth herein. “Registrable Securities” means the shares of Common Stock underlying
the Series B Preferred Stock issued and sold pursuant to this Offering.

 

    	 	Page 4	 

     

    

 

5.3           The
undersigned will receive an Exchange Right (as such term is defined in the Certificate of Designations) as set forth in the Certificate
of Designations and as summarized in the PPM.

 

		6	Governing Law; Arbitration; Venue.

 

6.1           This
Subscription Agreement and all rights and obligations hereunder shall be deemed to be made under and governed by the laws of the
State of Michigan applicable to agreements made and to be performed entirely within such State, without reference to such State’s
laws regarding the conflict of laws.

 

6.2           Any
dispute or difference with respect to any matter arising out of or in connection with this Subscription Agreement and the Offering
shall first be submitted for arbitration to the American Arbitration Association.

 

6.3           Any
litigation arising hereunder shall be instituted only in Ingham County or the state courts of the State of Michigan sitting in
Ingham County. All parties agree that venue shall be proper in Ingham County for all such legal or equitable proceedings.

 

6.4           Failure
of any party to exercise any right or remedy under this Subscription Agreement or otherwise, or delay by a party in exercising
such right or remedy, shall not operate as a waiver thereof.

 

6.5           All
pronouns and any variations thereof refer to the masculine, feminine or neuter, singular or plural, as the context may require.

 

6.6           The
headings of this Subscription Agreement are for convenience of reference and shall not form part of, or affect the interpretation
of, this Subscription Agreement.

 

6.7           If
any provision of this herein shall be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall not
affect the validity or enforceability of the remainder of this Subscription Agreement or the validity or enforceability of this
Subscription Agreement in any other jurisdiction. 

 

[Remainder of page
intentionally left blank. Signatures to follow]

 

    	 	Page 5	 

     

    

 

	Date: 	 	 

 

	Name of Subscriber:   	 

 

Type of Subscriber (check one): Individual _____ Tenants in
Common _____ Existing Partnership _____ Joint Tenants _____ Corporation _____ Trust _____ Minor with Adult Custodian under
UGMA _____

 

	Number of Shares of Series B Preferred Stock Subscribed For:	 

 

	Number of Warrants issuable (with a strike price of $16/share): 	 

 

	Purchase Price Per Unit: $16.00 	Aggregate Purchase Price for Units: $  	 

 

	By:	 	 	 
	 	Signature of Subscriber	 	Taxpayer I.D. Number of Subscriber
	Name: 	 	 	 
	Title:	 	 	 
	 	 	 
	Subscriber’s business address, including email, and 	 	Subscriber’s mailing address
	telephone number (please type or print)	 	(if different than business address)
	 	 	 
	 	 	 
	 	 	 
	Email:	 	 
	Phone:	 	 
	 	 	 
	By:	 	 	 
	 	Signature of Co-Subscriber	 	Taxpayer I.D. Number of Co-Subscriber
	Name:	 	 	 
	 	 	 
	Co-Subscriber’s business address including email and 	 	Co-Subscriber’s mailing address
	telephone number (please type or print)	 	(if different than business address)
	 	 	 
	 	 	 
	 	 	 
	Email:	 	 
	Phone:	 	 

 

Accepted: 

 

XG SCIENCES, INC.

 

	By: 	 	 	Date Accepted: 	 
	Name:  	 	 	 	 
	Title:	 	 	 	 

 

    	 	Page 6	 

     

    

 

EXHIBIT A

 

CERTIFICATE OF DESIGNATIONS OF SERIES
B CONVERTIBLE PREFERRED STOCK

 

     

     

    

 

EXHIBIT B

 

COMPANY WIRE INSTRUCTIONS

 

     

     

    

 

EXHIBIT C

 

CONFIDENTIAL ACCREDITED INVESTOR QUESTIONNAIRE

 

XG
SCIENCES, INC.

 

		To:	XG Sciences, Inc.

 

XG
Sciences, Inc., a Michigan corporation (the “Company”), is offering, pursuant to a Confidential Private Placement
Memorandum dated April 18, 2015 (the “Offering”) and pursuant to an accompanying Subscription Agreement (the
“Subscription Agreement”), up to $18,000,000 in Units. Each Unit shall consist of (i) shares of the Company’s
Series B Convertible preferred stock, no par value per share (the “Series B Preferred Stock”), which are convertible,
in accordance with the terms of the Certificate of Designations of Series B Convertible Preferred Stock attached to the Subscription
Agreement as Exhibit A, into shares of the Company’s common stock, no par value per share (“Common Stock”),
and (ii) subject to the terms of the Subscription Agreement, a warrant to purchase that number of shares of the Common Stock as
described in the Subscription Agreement and therein (the “Warrant” and together with the Series B Preferred
Stock, the “Securities”). 

 

I.           The
undersigned subscriber (the “Subscriber”) represents and warrants that he, she or it comes within one category
marked below, and that for any category marked, he, she or it has truthfully set forth, where applicable, the factual basis
or reason the Subscriber comes within that category. ALL INFORMATION IN RESPONSE TO THIS SECTION WILL BE KEPT STRICTLY CONFIDENTIAL
EXCEPT AS NECESSARY FOR THE COMPANY TO COMPLY WITH LAW AND/OR ANY RULES PROMULGATED BY ANY REGULATORY AGENCY. The undersigned shall
furnish any additional information which the Company deems necessary in order to verify the answers set forth below.

 

	Category A_____	 	The undersigned is an individual (not a partnership, corporation, etc.) whose individual net worth, or joint net worth with his or her spouse, presently exceeds $1,000,000.
	 	 	 
	 	 	Explanation. In calculating net worth you may include equity in personal property and real estate (other than the value, after deducting mortgage obligations, of Subscriber’s principal residence which may not be included in such net worth calculation), cash, short-term investments, stock and securities. Equity in personal property and real estate should be based on the fair market value of such property less debt secured by such property.
	 	 	 
	Category B_____	 	The undersigned is an individual (not a partnership, corporation, etc.) who had an individual income in excess of $200,000 in each of the two most recent years, or joint income with his or her spouse in excess of $300,000 in each of those years (in each case including foreign income, tax exempt income and full amount of capital gains and losses but excluding any income of other family members and any unrealized capital appreciation) and has a reasonable expectation of reaching the same income level in the current year.
	 	 	 
	Category C_____	 	The undersigned is a director or executive officer of the Company, which is issuing and selling the Securities.

 

    	 	1	 

     

    

 

	Category D_____	 	The undersigned is a bank; a savings and loan association; insurance company; registered investment company; registered business development company; licensed small business investment company (“SBIC”); or employee benefit plan within the meaning of Title 1 of ERISA and (a) the investment decision is made by a plan fiduciary which is either a bank, savings and loan association, insurance company or registered investment advisor, or (b) the plan has total assets in excess of $5,000,000 or is a self directed plan with investment decisions  made solely by persons that are accredited investors.

 

	 	 
	 	 
	 	 
	 	(describe entity)

 

	Category E____	 	The undersigned is a private business development company as defined in section 202(a)(22) of the Investment Advisors Act of 1940.

 

	 	 
	 	 
	 	 
	 	(describe entity)

 

	Category F_____	 	The undersigned is either a corporation, partnership, Massachusetts business trust, or non-profit organization within the meaning of Section 501(c)(3) of the Internal Revenue Code, in each case not formed for the specific purpose of acquiring the Securities and with total assets in excess of $5,000,000.

 

	 	 
	 	 
	 	 
	 	(describe entity)

 

	Category G_____	 	The undersigned is a trust with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the Securities, where the purchase is directed by a “sophisticated person” as defined in Regulation 506(b)(2)(ii) under the Securities Act of 1933.

 

	 	 
	 	 
	 	 
	 	(describe entity)

 

	Category H_____	 	The undersigned is an entity (other than a trust) all the equity owners of which are “accredited investors” within one or more of the above categories. If relying upon this Category alone, each equity owner must complete a separate copy of this Questionnaire.

 

	 	 
	 	 
	 	 
	 	(describe entity)

 

	Category I_____	 	The undersigned is not within any of the categories above and is therefore not an accredited investor.

 

    	 	2	 

     

    

 

For purposes hereof, “individual
income” means adjusted gross income less any income attributable to a spouse or to property owned by a spouse, increased
by the following amounts (but not including any amounts attributable to a spouse or to property owned by a spouse): (i) the amount
of any interest income received which is tax-exempt under Section 103 of the Internal Revenue Code of 1986, as amended (the “Code”),
(ii) the amount of losses claimed as a limited partner in a limited partnership (as reported on Schedule E of Form 1040), (iii)
any deduction claimed for depletion under Section 611 et seq. of the Code, and (iv) any amount by which income from long-term
capital gains has been reduced in arriving at adjusted gross income pursuant to the provisions of Section 12.02 of the Code.

 

The undersigned agrees that the undersigned
will notify the Company at any time on or prior to the execution of the Subscription Agreement or this Questionnaire in the event
that the representations and warranties in the Subscription Agreement or in this Questionnaire shall cease to be true, accurate
and complete.

 

		II.	SUITABILITY (please answer each question)

 

(a)          For
an individual Subscriber, please describe your current employment, including the company by which you are employed and its principal
business:

 

 

 

 

 

 

(b)          For
an individual Subscriber, please describe any college or graduate degrees held by you:

 

 

 

 

(c)          For
all Subscribers, please list types of prior investments:

 

 

 

 

 

(d)          For
all Subscribers, please state whether you have you participated in other private placements before:

 

YES________      NO________

 

(e)          If
your answer to question (d) above was “YES”, please indicate frequency of such prior participation in private placements
of:

 

	 	 	Public	 	Private
	 	 	Companies	 	Companies
	 	 	 	 	 
	Frequently	 	 	 	 
	Occasionally	 	 	 	 
	Never	 	 	 	 

 

    	 	3	 

     

    

 

(f)          For
individual Subscribers, do you expect your current level of income to significantly decrease in the foreseeable future:

 

YES________      NO________

 

(g)          For
trust, corporate, partnership and other institutional Subscribers, do you expect your total assets to significantly decrease in
the foreseeable future:

 

YES________      NO________

 

(h)          For
all Subscribers, do you have any other investments or contingent liabilities which you reasonably anticipate could cause you to
need sudden cash requirements in excess of cash readily available to you:

 

YES________      NO________

 

(i)          For
all Subscribers, are you familiar with the risk aspects and the non-liquidity of investments such as the Securities for which you
seek to subscribe?

 

YES________      NO________

 

(j)          For
all Subscribers, do you understand that there is no guarantee of financial return on this investment and that you run the risk
of losing your entire investment?

 

YES________      NO________

 

III.         MANNER
IN WHICH TITLE IS TO BE HELD. (circle one)

 

		(a)	Individual Ownership

		(b)	Community Property

		(c)	Joint Tenant with Right of Survivorship (both parties must
sign)

		(d)	Partnership*

		(e)	Tenants in Common

		(f)	Corporation*

		(g)	Trust*

		(h)	Limited Liability Company*

		(i)	Other

 

*If Securities are being subscribed for
by an entity, the attached Certificate of Signatory must also be completed.

 

		IV.	FINRA AFFILIATION.

 

Are you affiliated or associated with a FINRA member firm (please
check one):

 

YES________      NO________

 

If Yes, please describe:

 

 

 

 

    	 	4	 

     

    

 

 

*If Subscriber is a Registered Representative
with an FINRA member firm, have the following acknowledgment signed by the appropriate party:

 

The undersigned FINRA member firm acknowledges
receipt of the notice required by Rule 3050 of the NASD Conduct Rules.

 

	 	 
	Name of FINRA Member Firm	 
	 	 	 
	By:	 	 
	Authorized Officer	 
	 	 
	Date:	 	 

 

		V.	Disqualification Events.

 

		1.	Certain Criminal Convictions.

Have you been convicted, within
the past ten (10) years (or five (5) years, in the case of the Company, its predecessors and affiliated issuers), of any felony
or misdemeanor involving:

 

		·	in connection with the purchase or sale of any security;

		·	involving the making of any false filing with the U.S. Securities and Exchange Commission (the
“SEC”); or

		·	arising out of the conduct of the business of an underwriter, broker, dealer, municipal securities
dealer, investment advisor or paid solicitor of purchasers of securities?

 

 ̈
Yes. If yes, please explain: ____________________________________________________

 

 

 

 

 ̈
No.

 

		2.	Certain Court Injunctions and Restraining Orders.

Are you subject to any order,
judgment or decree of any court of competent jurisdiction that was entered within the past five (5) years and currently restrains
or enjoins you from engaging in any conduct or practice:

 

		·	in connection with the purchase or sale of any security;

		·	involving the making of any false filing with the SEC; or

		·	arising out of the conduct of the business of an underwriter, broker, dealer, municipal securities
dealer, investment adviser or paid solicitor of purchasers of securities?

 

 ̈
Yes. If yes, please explain: ____________________________________________________

 

 

    	 	5	 

     

    

 

 

 ̈

No.

 

		3.	Final Orders of Certain State and Federal Regulators.

Are you
subject to a Final Order (as defined below) of state regulators of securities, insurance, banking, savings associations or credit
unions; federal banking agencies; the Commodity Futures Trading Commission; or the National Credit Union Administration that:

 

		·	bars you from:

		·	associating with an entity regulated by any of the aforementioned regulators;

		·	engaging in the business of securities, insurance or banking; or

		·	engaging in savings association or credit union activities; or

 

		·	constitutes a Final Order based on a violation of any law or regulation that prohibits fraudulent,
manipulative, or deceptive conduct entered within the past ten (10) years?

 

 ̈
Yes. If yes, please explain: ____________________________________________________

 

 

 

 

 ̈
No.

 

The term “Final Order”
means a written directive or declaratory statement issued by a federal or state agency described in Rule 506(d)(1)(iii) under the
Securities Act of 1933 under applicable statutory authority that provides for notice and an opportunity for a hearing, which constitutes
a final disposition or action by that federal or state agency.

 

		4.	SEC Disciplinary Orders.

Are you subject to any order
of the SEC that currently:

 

		·	suspends or revokes your registration as a broker, dealer, municipal securities dealer or investment
adviser;

		·	places limitations on the activities, functions or operations of, or imposes civil money penalties
on, such person; or

		·	bars you from being associated with any entity or from participating in the offering of any penny
stock?1

 

 ̈
Yes. If yes, please explain: ____________________________________________________

 

 

 

 

 ̈
No.

 

 

1
A disqualification based on a suspension or limitation of activities expires when the suspension or limitation expires.

 

    	 	6	 

     

    

 

		5.	SEC Cease-and-Desist Orders.

Are you subject to any order
of the SEC that was entered within the past five (5) years and currently orders you to cease and desist from committing or causing
a future violation of:

 

		·	any scienter-based (intent-based) anti-fraud provision of the federal securities laws (including,
for example, but not limited to):

		·	Section 17(a)(1) of the Securities Act of 1933,

		·	Section 10(b) of the Exchange Act and Rule 10b-5, and

		·	Section 15 (c) (1) of the Securities Exchange Act); or

 

		·	Section 5 of the Securities Act of 1933, which generally requires that securities be registered
and prohibits the sale of unregistered securities.

 

 ̈
Yes. If yes, please explain: ____________________________________________________

 

 

 

 

 ̈
No.

 

		6.	SRO Suspension/Expulsion.

Have you been suspended or expelled
from membership in, or suspended or barred from association with a member of, a securities self-regulatory organization (“SRO”,
such as a registered national securities exchange or a registered national or affiliated securities association, including FINRA)
for any act or omission to act constituting conduct inconsistent with just and equitable principles of trade?

 

 ̈
Yes. If yes, please explain: ____________________________________________________

 

 

 

 

 ̈
No.

 

		7.	SEC Stop Orders.

Have you filed (as a registrant
or issuer), or were you named as an underwriter in any registration statement or Regulation A offering statement filed with the
SEC that, within the past five (5) years, was the subject of a refusal order, stop order, or order suspending the Regulation A
exemption, or is currently the subject of an investigation or proceeding to determine whether a stop order or suspension order
should be issued?

 

 ̈
Yes. If yes, please explain: ____________________________________________________

 

 

 

 

 ̈
No.

 

		8.	USPS False Representations Order.

Are you subject to a United States
Postal Service (“USPS”) false representation order entered within the past five (5) years, or are you currently
subject to a temporary restraining order or preliminary injunction with respect to conduct alleged by the USPS to constitute a
scheme or device for obtaining money or property through the mail by means of false representations?

 

    	 	7	 

     

    

 

 ̈
Yes. If yes, please explain: ____________________________________________________

 

 

 

 

 ̈
No.

 

VI.          The
undersigned is informed of the significance to the Company of the foregoing representations and answers contained in this Questionnaire
contained herein and such answers have been provided under the assumption that the Company will rely on them.

 

VII.         In
furnishing the above information, the undersigned acknowledges that the Company will be relying thereon in determining, among other
things, whether there are reasonable grounds to believe that the undersigned qualifies as a Purchaser under Section 4(2) and/or
Regulation D of the Securities Act of 1933 and applicable state securities laws for the purposes of the proposed investment.

 

VIII.         The
undersigned understands and agrees that the Company may request further information of the undersigned in verification or amplification
of the undersigned’s knowledge of business affairs, the undersigned’s assets and the undersigned’s ability to
bear the economic risk involved in an investment in the securities of the Company.

 

IX.          The
undersigned represents to you that (a) the information contained herein is complete and accurate on the date hereof and may be
relied upon by you, (b) the undersigned will notify you immediately of any change in any such information occurring prior to the
acceptance of the subscription and will promptly send you written confirmation of such change. The undersigned hereby certifies
that he, she or it has read and understands the Subscription Agreement related hereto and (c) the undersigned acknowledges that
you may be required to publicly disclose the information provided in this Questionnaire and that he, she or it consents to such
public disclosure.

 

X.           In
order for the Company to comply with applicable anti-money laundering/U.S. Treasury Department Office of Foreign Assets Control
(“OFAC”) rules and regulations, Subscriber is required to provide the following information:

 

    	 	8	 

     

    

 

		1.	Payment Information

 

(a)          Name
and address (including country) of the bank from which Subscriber’s payment to the Company is being wired (the “Wiring
Bank”):

 

	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 

 

(b)          Subscriber’s
wiring instructions at the Wiring Bank:

 

	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 

 

(c)          Is
the Wiring Bank located in the U.S. or another “FATF Country”*?

 

 ̈
Yes               ̈
No

 

(d)          Is
Subscriber a customer of the Wiring Bank?

 

 ̈
Yes               ̈
No

 

		2.	Additional Information

 

For Individual
Subscribers:

 

_____ A government issued
form of picture identification (e.g., passport or drivers license).

 

_____ Proof of the individual’s
current address (e.g., current utility bill), if not included in the form of picture identification.

 

  

 

*
As of the date hereof, countries that are members of the Financial Action Task Force on Money Laundering (“FATF Country”)
are: Argentina, Australia, Austria, Belgium, Brazil, Canada, Denmark, Finland, France, Germany, Greece, Hong Kong, Iceland, Ireland,
Italy, Japan, Luxembourg, Mexico, Kingdom of the Netherlands, New Zealand, Norway, Portugal, Russian Federation, Singapore, South
Africa, Spain, Sweden, Switzerland, Turkey, United Kingdom and the United States of America.

    	 	9	 

     

    

 

For Funds of Funds
or Entities that Invest on Behalf of Third Parties:

 

	_____	A certificate of due formation and organization and continued authorization to conduct business in the jurisdiction of its organization (e.g., certificate of good standing).
	 	 
	_____	An “incumbency certificate” attesting to the title of the individual executing these subscription materials on behalf of the prospective investor.
	 	 
	_____	A completed copy of a certification that the entity has adequate anti-money laundering policies and procedures (“AML Policies and Procedures”) in place that are consistent with the USA PATRIOT Act, OFAC and other relevant federal, state or non-U.S. anti-money laundering laws and regulations (with a copy of the entity’s current AML Policies and Procedures to which such certification relates).
	 	 
	_____	A letter of reference any entity not located in the U.S. or other FATF Country, from the entity’s local office of a reputable bank or brokerage firm that is incorporated, or has its principal place of business located, in the U.S. or other FATF Country certifying that the prospective investor maintains an account at such bank/brokerage firm for a length of time and containing a statement affirming the prospective investor’s integrity.

 

For all other Entity
Subscribers:

 

	_____	A certificate of due formation and organization and continued authorization to conduct business in the jurisdiction of its organization (e.g., certificate of good standing).
	 	 
	_____	An “incumbency certificate” attesting to the title of the individual executing these subscription materials on behalf of the prospective investor.
	 	 
	_____	A letter of reference from the entity’s local office of a reputable bank or brokerage firm that is incorporated, or has its principal place of business located, in the U.S. or other FATF Country certifying that the prospective investor maintains an account at such bank/brokerage firm for a length of time and containing a statement affirming the prospective investor’s integrity.
	 	 
	_____	If the prospective investor is a privately-held entity, a certified list of the names of every person or entity who is directly or indirectly the beneficial owner of 25% or more of any voting or non-voting class of equity interests of the Subscriber, including (i) country of citizenship (for individuals) or principal place of business (for entities) and, (ii) for individuals, such individual’s principal employer and position.
	 	 
	_____	If the prospective investor is a trust, a certified list of (i) the names of the current beneficiaries of the trust that have, directly or indirectly, 25% or more of any interest in the trust, (ii) the name of the settlor of the trust, (iii) the name(s) of the trustee(s) of the trust, and (iv) the country of citizenship (for individuals) or principal place of business (for entities).

 

    	 	10	 

     

    

 

		XI.	ADDITIONAL INFORMATION.

 

A TRUST MUST ATTACH
A COPY OF ITS DECLARATION OF TRUST OR OTHER GOVERNING INSTRUMENT, AS AMENDED, AS WELL AS ALL OTHER DOCUMENTS THAT AUTHORIZE THE
TRUST TO INVEST IN THE SECURITIES. ALL RESOLUTIONS AND DOCUMENTATION MUST BE COMPLETE AND CORRECT AS OF THE DATE HEREOF.

 

		XII.	INFORMATION VERIFICATION CONSENT.

 

BY SIGNING THIS QUESTIONNAIRE,
SUBSCRIBER HEREBY GRANTS THE COMPANY PERMISSION TO REVIEW ALL PUBLICLY AVAILABLE INFORMATION REGARDING SUBSCRIBER, INCLUDING, BUT
NOT LIMITED TO INFORMATION PROVIDED BY OFAC FOR THE PURPOSE OF VERIFYING INFORMATION PROVIDED BY SUBSCRIBER HEREIN.

 

[SIGNATURE PAGE FOLLOWS]

 

    	 	11	 

     

    

  

INVESTOR QUESTIONNAIRE EXECUTION PAGE

 

	 	 	 
	Subscriber’s Name	 	Co-Subscriber’s Name
	 	 	 
	 	 	 
	Signature	 	Signature (if purchasing jointly)
	 	 	 
	 	 	 
	Name Typed or Printed	 	Name Typed or Printed
	 	 	 
	 	 	 
	Title	 	Title
	 	 	 
	 	 	 
	Address	 	Address
	 	 	 
	 	 	 
	City, State and Zip Code	 	City, State and Zip Code
	 	 	 
	 	 	 
	Telephone Number	 	Telephone Number
	 	 	 
	 	 	 
	Email Address	 	Email Address

 

 

    	 	12	 

     

    

 

EXHIBIT D

FORM OF WARRANT

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