Document:

Exhibit 10.2

 

NEITHER THIS NOTE NOR THE SECURITIES INTO
WHICH THIS NOTE IS CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF
ANY STATE, IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.

 

	No. ____________-	$_____]

 

XG SCIENCES, INC.

 

Form of 

Convertible Secured Note

 

Due December 31, 2024

 

This Convertible Secured
Note (this “Note”) is issued this __th day of _____2020, jointly and severally by XG Sciences,
Inc. (“XGS”), a Michigan corporation, and XG Sciences IP, LLC, a Michigan limited liability company and
wholly owned subsidiary of XGS (“XGS Subsidiary” and together with XGS, the “Borrower”
or the “Company”), to the subscriber made a party hereto (together with Subscriber’s permitted
successors and assigns, the “Holder”). This Note has been issued in connection with that certain Employment
Agreement, dated August 26, 2020, between the Holder and XGS and Subscription Agreement, dated August 26, 2020, between Holder
and XGS (the “Subscription Agreement”). Capitalized terms not otherwise defined herein shall have the
meanings set forth in the Subscription Agreement.

 

FOR VALUE RECEIVED,
the Borrower hereby promises to pay to the Holder or his, her or its permitted successors and assigns the principal sum of ______________________
DOLLARS ($___________) plus all accrued interest (in accordance with Section 1 herein) on or before (subject to the terms and conditions
herein) December 31, 2024 (the “Maturity Date”).

 

This Note is subject
to the following additional provisions:

 

		Section 1.	Interest; Prepayments.

 

(a)       Interest.
Interest shall accrue from the Original Issue Date at the rate of 7.5% per annum, compounded on, and added to the balance hereunder
on, a fiscal quarterly basis at the end of each such fiscal quarter. Principal and accrued interest shall be payable on the Maturity
Date; provided, however, in the event that (i) the First Lien Lender (as defined in the Intercreditor Agreement) has received all
unpaid interest accrued on the First Lien Credit Agreement (as defined in the Intercreditor Agreement) and (ii) the Borrower has
recorded GAAP revenue of at least $4.0 million for two consecutive quarters (together, the “Financial Hurdle”),
then Holder may elect to receive all accrued interest in cash on a fiscal quarterly basis on the last day of each fiscal quarter
(each, a “Quarterly Interest Payment Date”) commencing on the last day of the next fiscal quarter after
satisfaction of the Financial Hurdle (the “Initial Quarterly Interest Payment Date”). Such election may
be made at any time to the Borrower in writing (which may be email) on or prior to each Quarterly Interest Payment Date. Borrower
shall promptly within ten (10) Business Days provide notice (which may be by filing or furnishing a Form 10-Q, Form 10-K, or Form
8-K with the SEC on EDGAR within four business days of the event) to the Holder of its satisfaction of the Financial Hurdle. Interest
payable in cash hereunder shall be paid in US Dollars to the Holder at the address last appearing on the Note register of the Borrower
or as designated in writing by the Holder from time to time.

 

    	 

     

    

 

Notwithstanding the
above, (i) all rights to payment hereunder shall be subject to subordination pursuant to the Intercreditor Agreement, (ii) in the
event that the entire principal amount of this Note is converted into Conversion Securities pursuant to Section 3 below, all accrued
interest due and owing under this Note on the date of conversion shall be due immediately and shall be added to the principal amount
hereof to determine the total amount of indebtedness hereunder being converted into Conversion Securities and (iii) upon a Change
of Control all principal and accrued interest hereon as of such date shall become immediately due and owing in cash; provided that
the Holder may, at its option, elect to convert the principal amount and all accrued interest thereon into Conversion Securities.
In the event that less than all of the principal amount of this Note is converted into Conversion Securities, a pro rata potion
of the accrued interest (based on the percentage of this Note converted) shall be due immediately and shall be added to the portion
of the principal amount of this Note being converted into Conversion Securities on the date of conversion.

 

(b)       Prepayments.
The Borrower may not prepay the principal or accrued interest under this Note for cash at any time prior to the Maturity Date (or,
with respect to accrued interest payable in cash each fiscal quarter in accordance with Section 1(a) above, prior to any Quarterly
Interest Payment Date) without the prior written consent of the Holder.

 

		Section 2.	Events of Default.

 

(a)          An
“Event of Default”, wherever used herein, means any one of the following events (whatever the
reason and whether it shall be voluntary or involuntary or effected by operation of law or pursuant to any judgment, decree or
order of any court, or any order, rule or regulation of any administrative or governmental body):

 

(i)       Any
default in the payment of the principal of, interest on, or other charges in respect of this Note, free of any claim of subordination,
as and when the same shall become due and payable;

 

(ii)       The
Borrower shall fail to observe or perform any other covenant, term, condition, agreement or obligation contained in, or otherwise
commit any breach or default of any provision of this Note (except as may be covered by Section 2(a)(i) hereof), any Transaction
Document (as defined in Section 6 below) and such failure is not cured (A) by the time prescribed or (B) if no time is prescribed,
such failure is not cured within thirty (30) days after the Borrower’s receipt of written notice from the Holder of such
failure; or

 

(iii)       Any
of the representations or warranties made by the Borrower herein or in any of the other Transaction Documents shall be false or
misleading in any material respect at the time made; or

 

(iv)       The
Borrower (A) fails to authorize and issue or to cause its Transfer Agent to issue Conversion Securities upon the exercise by the
Holder of the conversion rights of the Holder in accordance with the terms of this Note (provided, however, that for purposes of
this provision, such failure to issue or cause the Transfer Agent to issue such shares shall not be deemed to occur until Five
(5) Business Days after the Conversion Date), (B) fails to transfer or to cause its Transfer Agent to transfer any certificate
for Conversion Securities issued upon conversion of this Note and when required by this Note, and such transfer is otherwise lawful,
or (C) fails to remove a restrictive legend or cause its Transfer Agent to remove a restrictive legend on any share certificate,
in each case where such removal is lawful, and any such failure of A, B or C above shall continue uncured for ten (10) days; or

 

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(v)       The
Borrower shall default on any other indebtedness or material obligation to which it is a party and any other party to any such
indebtedness or material agreement with the Company in default exercises any material remedies which it may be entitled; or

 

(vi)       an
Event of Default shall have occurred under the First Lien Obligations (as defined in the Intercreditor Agreement); or

 

(vii)      The
Borrower or any Subsidiary of the Borrower shall commence, or there shall be commenced against the Borrower or any Subsidiary of
the Borrower, a proceeding under any applicable bankruptcy or insolvency laws as now or hereafter in effect or any successor thereto,
or the Borrower or any Subsidiary of the Borrower shall commence any other proceeding under any reorganization, arrangement, adjustment
of debt, relief of debtors, dissolution, insolvency or liquidation or similar law of any jurisdiction, whether now or hereafter
in effect, relating to the Borrower or any Subsidiary of the Borrower; or there is commenced against the Borrower or any Subsidiary
of the Borrower any such bankruptcy, insolvency or other proceeding which remains un-dismissed for a period of sixty-one (61) days;
or the Borrower or any Subsidiary of the Borrower is adjudicated insolvent or bankrupt; or any order of relief or other order approving
any such case or proceeding is entered; or the Borrower or any Subsidiary of the Borrower suffers any appointment of any custodian,
private or court appointed receiver or the like for it or any substantial part of its property, which continues un-discharged or
un-stayed for a period of sixty one (61) days; or the Borrower or any Subsidiary of the Borrower makes a general assignment for
the benefit of creditors; or the Borrower or any Subsidiary of the Borrower shall fail to pay, or shall state that it is unable
to pay, or shall be unable to pay, its debts generally as they become due; or the Borrower or any Subsidiary of the Borrower shall
by any act or failure to act expressly indicate its consent to, approval of or acquiescence in any of the foregoing; or any corporate
or other action is taken by the Borrower or any Subsidiary of the Borrower for the purpose of effecting any of the foregoing.

 

(b)       If
an Event of Default shall have occurred and is continuing, then, unless and until such Event of Default shall have been cured or
waived in writing by the Holder (which waiver shall not be deemed to be a waiver of any subsequent default), at the option of the
Holder and in the Holder’s sole discretion, but without further notice from the Holder, the unpaid amount of this Note, computed
as of the date on which the Event of Default was first deemed to have occurred, will bear interest at the rate (the “Default
Rate”) equal to eighteen percent (18%) per annum or the highest rate allowed by law, whichever is lower, from the
date of the Event of Default until and including the date actually paid; and any partial payments shall be applied in the order
provided in Section 14 hereof.

 

(c)       During
the time that any portion of this Note is outstanding, if any Event of Default has occurred and any applicable cure period has
expired, the Holder, at its option, may declare that the full principal amount of this Note, together with any accrued interest
and other amounts owed pursuant to any other provision of this Note or any other Transaction Document are immediately due and payable
in cash (an “Acceleration”), subject to any restrictions imposed by the Intercreditor Agreement. In addition
to any other remedies, the Holder shall have the right (but not the obligation) to convert this Note at any time after an Event
of Default in accordance with Section 3(b). The Holder need not provide and the Borrower hereby waives any presentment, demand,
protest or other notice of any kind; and immediately and without expiration of any grace period, the Holder may enforce any and
all rights and remedies hereunder and all other remedies available under the Security Instruments or under applicable law, subject
to the Intercreditor Agreement. Furthermore, a declaration of an Event of Default may be rescinded and annulled by the Holder at
any time prior to payment hereunder. No such rescission or annulment shall affect or impair any of the Holder’s rights with
respect to any subsequent Event of Default.

 

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		Section 3.	Conversion.

 

(a)          Conversion
at Option of Holder. Any principal, currently due interest, accrued interest, or other amounts due and payable under
this Note at any time (collectively, the “Outstanding Amount” as of such time) shall be convertible into
either (i) shares of Series B Preferred Stock or (ii) any other form of preferred or Common Stock issued after the Initial Funding
(“Subsequent Equity” and together with the Series B Preferred Stock generally referred to as the “Conversion
Securities”) at the option of the Holder, in whole or in part at any time and from time to time, after the Original
Issue Date so long as this Note is outstanding. The number of shares of Conversion Securities that may be issued upon a conversion
hereunder shall equal the quotient obtained by dividing (x) the Outstanding Amount of this Note, or any portion thereof,
to be converted as of the Conversion Date (as defined in Section 3(c)) by (y) the applicable Note Conversion Price (as defined
in Section 3(d) below).

 

(b)          Conversion
at Option of Borrower. If and when the Company raises at least $15 million of equity capital, excluding equity raised in
the Offering, after the Initial Funding (a “Qualified Capital Event”), the Outstanding Amount due and
payable under this Note as of the Conversion Date may, at the option of the Borrower, be converted into whichever form of Conversion
Securities that would result in the greatest number of shares of Common Stock being issued to the Holder on an “as-if-converted”
into Common Stock basis at such time at the Note Conversion Price then in effect for the applicable Conversion Security (the “Borrower
Option”) upon written notice delivered to the Holder fifteen (15) Business Days prior to the date on which such Borrower
Option will become effective. In addition, in the event any Notes are still outstanding on the date the Company lists its shares
of Common Stock on a Qualified National Exchange (as defined in the Certificate of Designations), then upon the consummation of
any such listing, this Note will be deemed to have automatically converted first into Series B Preferred Stock at a Note Conversion
Price of $8.00 per share and then into shares of Common Stock at the Series B Conversion Rate (as defined in the Certificate of
Designations) in effect at such time pursuant to the Certificate of Designations.

 

(c)          Exercise
of Conversion Options. The: (i) Holder shall effect conversions in Section 3(a) by delivering to the Borrower a completed
notice in the form attached hereto as EXHIBIT A (a “Holder Notice of Conversion”), and
(ii) Borrower shall effect the conversion in Section 3(b) by delivering written notice to the Holder (a “Borrower Notice
of Conversion”). The “Conversion Date” shall be (A) if the Holder delivers a Holder Notice
of Conversion, the date on which a Holder Notice of Conversion is delivered, or (B) if the Borrower delivers a Borrower Notice
of Conversion, the date which is fifteen (15) Business Days from the date such is deemed to have been delivered pursuant to Section
17 hereof. The Borrower shall deliver the applicable stock certificate to the Holder prior to the close of the fifth (5th)
Business Day after a Conversion Date. The Holder shall physically surrender this Note to the Borrower in connection with a conversion,
whether a partial conversion or a total conversion. In the event of a partial conversion, in order to reflect the reduction in
the outstanding principal amount of this Note and the reduction in the accrued and unpaid interest, the Borrower shall prepare
and deliver to the Holder a new Note, identical in all respects to the surrendered Note except for the principal amount outstanding
reflected on the first page hereof. Such replacement Note (resulting from the partial conversion) shall be delivered to the Holder
prior to the close of the fifth (5th) Business Day after the applicable Conversion Date. The Holder and the Borrower
shall maintain records showing the principal amount converted and the date of such conversions. In the event of any dispute or
discrepancy, the records of the Borrower shall be controlling and determinative in the absence of manifest error; provided, however,
that if the Borrower has not kept records or there is manifest error in the Borrower’s records, then the records of the Holder
shall be controlling and determinative.

 

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(d)          Note
Conversion Price and Adjustments to Note Conversion Price.

 

(i)       The
conversion price in effect on any Conversion Date shall (i) if the conversion is into Series B Preferred Stock, then the conversion
price shall be $8.00; or (ii) if the conversion is into Subsequent Equity, then the conversion price shall be equal to 80% of the
purchase price per share at which such Subsequent Equity is sold or, if the value per share is fixed, 120% of the number of shares
that might otherwise be issuable; provided, however, that if a Qualified Capital Event occurs within one hundred twenty (120) days
after the Initial Funding, then, the note conversion price shall be equal to 90% of the purchase price per share at which such
Subsequent Equity is sold, or if the value per share is fixed, 110% of the number of shares that might otherwise be issuable (such
note conversion price as may be in effect on a Conversion Date for any Conversion Security, herein generally referred to as the
“Note Conversion Price”).

 

(ii)       The
Borrower agrees to provide notice to the Holders of any event or issuance of Subsequent Equity that would result in any adjustment
to the Note Conversion Price pursuant to this Section 3(d) and such notice shall specify the new Note Conversion Price in effect.

 

(e)          No
Taxes on Certificates. The issuance of certificates for any Conversion Securities shall be made without charge to the
Holder thereof for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such certificate.

 

Section
4.             Exchange into New Securities
Issued to Third Parties. After the Original Issue Date but prior to any date that the Borrower raises $15,000,000
of cumulative equity capital since the Initial Funding excluding equity raised in the Offering, in the event that the Borrower
consummates any financing transaction with any other third party using any other form of convertible debt security (any such security
used in such new financing hereinafter referred to as a “New Security”), then the Holder shall have
the option, in its sole discretion, to exchange all or any portion of the obligations outstanding under this Note into such New
Security on the same terms as such New Security was offered to third parties (an “Exchange”). Upon
an Exchange, the Holder also shall be assigned all rights (and assume all obligations other than obligations to provide any incremental
amounts of financing to the Company) provided in the definitive agreements pursuant to which the New Security was sold. The Borrower
covenants and agrees that so long as all or any portion of this Note is outstanding, it will notify in writing any Holder of this
Note promptly within ten (10) Business Days of the issuance of any New Security and such notice will contain the aggregate dollar
amount or principal amount of such New Securities being issued to each new holder of such securities, and (c) a copy of all transaction
documentation for such New Security. (a)

 

		Section 5.	Security Instruments; Subordination.

 

(a)         Security
Instruments. This Note is secured by (a) a Convertible Notes Subordinated Security Agreement dated April 23, 2020 (the
“Commencement Date”) by and between the Borrower and the Collateral Agent for itself and as agent for
the benefit of the Holder and the other subscribers in the Offering (the “Security Agreement”), (b) a
Convertible Notes Intellectual Property Subordinated Security Agreement dated the Commencement Date by and among XGS, XGS Subsidiary
and the Collateral Agent for itself and as agent for the benefit of the Holder and the other subscribers in the Offering (the “IP
Security Agreement”), (c) the Convertible Notes Subsidiary Subordinated Security Agreement dated the Commencement
Date, by and between XGS Subsidiary and the Collateral Agent for itself and as agent for the benefit of the Holder and the other
subscribers in the Offering (the “Subsidiary Security Agreement”) and (d) the Convertible Notes Pledge
Agreement dated the Commencement Date, by and among XGS, XGS Subsidiary and Collateral Agent for itself and as agent for the benefit
of the Holder and the other subscribers in the Offering (the “Pledge Agreement”, and together with the
Security Agreement, the IP Security Agreement, the Subsidiary Security Agreement, the “Security Instruments”).

 

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(b)          Subordination.
The Holder acknowledges and agrees the following:

(i)       the
Borrower entered into a First Lien Credit Agreement (as defined in the Intercreditor Agreement) with the First Lien Lender (as
defined in the Intercreditor Agreement) on the Commencement Date and that all of Borrower’s obligations under the First Lien
Credit Agreement and the other First Lien Loan Documents (as defined in the Intercreditor Agreement) are secured
by liens on and security interests in substantially all of the now existing and hereafter acquired personal property assets of
XGS and XGS Subsidiary (as defined in the preamble),

 

(ii)       the
security interest created by the Security Instruments shall be subordinated pursuant to the Intercreditor Agreement to the interests
of the First Lien Lender under the First Lien Loan Documents (as defined in the Intercreditor Agreement),

 

(iii)       notwithstanding
any provision in this Note to the contrary, this Note will be subordinate in right of payment to the First Lien Obligations under
the terms of the Intercreditor Agreement and no payment shall be made on this Note until the First Lien Lender under the First
Lien Loan Documents is Paid in Full (as defined in the Intercreditor Agreement) and 

 

(iv)       Subscriber
will not be a party to the Intercreditor Agreement or the Security Instruments, however the Collateral Agent shall execute such
instruments for itself and as agent for the benefit of the Holder and the other subscribers in the Offering.

 

(c)          Ranking;
Seniority. This Note is a direct obligation of the Borrower. This Note is subordinate in right of payment and in security
pursuant to the Intercreditor Agreement, ranks pari passu to the other notes issued in the Offering and ranks senior to all other
indebtedness of the Borrower issued after the termination of the Offering. Except as stated above, no indebtedness of the Borrower,
either now or hereafter while this Note is outstanding, is or will be senior to this Note in right of payment, whether with respect
to interest, damages or upon liquidation or dissolution or otherwise, with respect to the assets of the Borrower. Without the Collateral
Agent’s consent, the Borrower shall not and shall not permit any of its Subsidiaries to, directly or indirectly, enter into,
create, incur, assume or suffer to exist any indebtedness of any kind, on or with respect to any of its property or assets now
owned or hereafter acquired or any interest therein or any income or profits therefrom that, in any such case, is senior in any
respect to the obligations of the Borrower under this Note.

 

		Section 6.	Definitions. For the purposes hereof,
the following terms shall have the following meanings:

 

“Business
Day” means any day except Saturday, Sunday and any day which shall be a federal legal holiday in the United States
or a day on which banking institutions are authorized or required by law or other government action to close.

 

“Change
of Control” means the occurrence of any of the following events after the Original Issue Date: (i) any “person”
or “group” (as defined in Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”) together with their affiliates become the ultimate “beneficial owner” (as defined in Rule 13d-3
of the Exchange Act) of voting stock of the Borrower representing more than 50% of the voting power of the total voting stock of
the Borrower; (ii) the stockholders of the Borrower approve a merger or consolidation of the Borrower with any other Person regardless
of which entity is the survivor, other than a merger or a consolidation which would result in the voting stock of the Borrower
outstanding immediately prior thereto continuing to represent (either by remaining outstanding or being converted into voting securities
of the surviving entity or the parent thereof) at least 50% of the combined voting power of the voting securities of the Borrower
or such surviving entity or the parent thereof, outstanding immediately after such merger or consolidation; or (iii) the stockholders
of the Borrower approve a plan of complete liquidation or winding up of the Borrower or an agreement for the sale or disposition
by the Borrower of all or substantially all of the Borrower’s assets.

 

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“GAAP”
shall mean generally accepted accounting principles in the United States.

 

“Initial
Funding” shall mean the first date on which any Notes are sold to investors pursuant to the Offering.

 

“Intercreditor
Agreement” shall mean that certain Intercreditor Agreement, dated [ ], by and among Dow, Inc., a Michigan corporation
as First Lien Lender, the Collateral Agent in its capacity as agent for the Holder and the other subscribers in the Offering and
the Borrower.

 

“Original
Issue Date” shall mean the date of the first issuance of this Note regardless of the number of transfers and regardless
of the number of instruments, which may be issued to evidence such Note. For the purposes of this Note, the Original Issue Date
shall be deemed to be the date first set forth herein.

 

“Person” means
a corporation, an association, a partnership, organization, a business, an individual, a government or political subdivision thereof
or a governmental agency.

 

“Subsidiary”
shall mean, (i) as to Borrower, any Person in which more than fifty percent (50%) of all equity, membership, partnership
or other ownership interests is owned directly or indirectly by such Borrower or one or more of its Subsidiaries, and (ii) as to
any other Person, any Person in which more than fifty percent (50%) of all equity, membership, partnership or other ownership interests
is owned directly or indirectly by such Person or by one or more of such Person’s Subsidiaries.

   

“Transaction
Documents” means the Subscription Agreement and any other agreement delivered in connection with the Subscription
Agreement, including, without limitation, this Note, the Intercreditor Agreement and each Security Instrument.

 

“Transfer
Agent” means any stock transfer agent that the Borrower may appoint from time to time or if no such transfer agent
has been appointed, then the Borrower.

 

Section
7.             No Stockholder Rights. Except to the extent provided in the Transaction Documents,
this Note shall not entitle the Holder to any of the rights of a stockholder of the Borrower, including without limitation, the
right to vote, to receive dividends and other distributions, or to receive any notice of, or to attend, meetings of stockholders
or any other proceedings of the Borrower, unless and to the extent converted into Conversion Securities in accordance with the
terms hereof.

 

Section
8.             Spin-offs. If, at any time while any portion of this Note remains outstanding, the
Borrower spins off or otherwise divests itself of a part of its business or operations or disposes of all or of a part of its assets
in a transaction (the “Spin Off”) in which the Borrower, in addition to or in lieu of any other compensation
received and retained by the Borrower for such business, operations or assets, causes securities of another entity (the “Spin
Off Securities”) to be issued to security holders of the Borrower, the Borrower shall cause (i) to be reserved Spin
Off Securities equal to the number thereof which would have been issued to the Holder had all, of the Holder’s Notes outstanding
on the record date (the “Record Date”) for determining the amount and number of Spin Off Securities to
be issued to security holders of the Borrower (the “Outstanding Notes”) been converted as of the close
of business on the Business Day immediately before the Record Date (the “Reserved Spin Off Shares”),
and (ii) to be issued to the Holder on the conversion of all or any of the Outstanding Notes, such amount of the Reserved Spin
Off Shares equal to (x) the Reserved Spin Off Shares multiplied by (y) a fraction, of which (I) the numerator is the principal
amount of the Outstanding Notes then being converted, and (II) the denominator is the principal amount of the Outstanding Notes.

 

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Section
9.             Transferability. This Note has been issued subject to investment representations
of the original Holder hereof and may be transferred to (a) any entity controlled by the Holder, (b) any investors in the Holder
or their direct assignees or (c) any other accredited investors or exchanged only in compliance with the Securities Act of 1933,
as amended (the “Act”), and other applicable state and foreign securities laws. In the event of any proposed
transfer of this Note, the Borrower may require, prior to issuance of a new Note in the name of such other person, that it receive
reasonable transfer documentation that is sufficient to evidence that such proposed transfer complies with the Act and other applicable
state and foreign securities laws. Prior to due presentment for transfer of this Note, the Borrower and any agent of the Borrower
may treat the person in whose name this Note is duly registered on the Borrower’s Note register as the owner hereof for the
purpose of receiving payment as herein provided and for all other purposes, whether or not this Note be overdue, and neither the
Borrower nor any such agent shall be affected by notice to the contrary. Subject to the foregoing, this Note may be transferred
or assigned, in whole or in part, by the Holder at any time. The Notes will initially be issued in denominations determined by
the Borrower, but are exchangeable for an equal aggregate principal amount of Notes of different denominations, as requested by
the Holder surrendering the same. No service charge will be made for such registration or transfer or exchange.

 

Section
10.            Replacement.
If this Note is mutilated, lost, stolen or destroyed, the Borrower shall execute and deliver, in exchange and substitution
for and upon cancellation of the mutilated Note, or in lieu of or in substitution for a lost, stolen or destroyed Note, new Note
for the principal amount of this Note so mutilated, lost, stolen or destroyed but only upon receipt of evidence of such loss,
theft or destruction of such Note, a and of the ownership hereof, and an agreement to indemnify Borrower for any resulting claims,
all reasonably satisfactory to the Borrower.

 

Section
11.            Enforcement Expenses. If the Borrower fails to strictly comply with the terms of
this Note, then the Borrower shall reimburse the Holder promptly for all reasonable fees, costs and expenses, including, without
limitation, reasonable attorneys’ fees and expenses of the Holder in any action in connection with this Note that are incurred:
(a) during any workout, attempted workout, and in connection with the rendering of legal advice as to the Holder’s
rights, remedies and obligations; (b) collecting any sums which become due to the Holder, (c) defending or prosecuting
any proceeding or any counterclaim to any proceeding or appeal; or (d) the protection, preservation or enforcement of any
rights or remedies of the Holder under this Note or any of the other Transaction Documents.

 

Section
12.            Waiver. Any waiver by the Holder of a breach of any provision of this Note shall
not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of
this Note. The failure of the Holder to insist upon strict adherence to any term of this Note on one or more occasions shall not
be considered a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other
term of this Note. Any waiver must be in writing.

 

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Section
13.            Severability.
If any provision of this Note is invalid, illegal or unenforceable, the balance of this Note shall remain in effect, and
if any provision is inapplicable to any person or circumstance, it shall nevertheless remain applicable to all other persons and
circumstances. If it shall be found that any interest or other amount deemed interest due hereunder shall violate applicable laws
governing usury, the applicable rate of interest due hereunder shall automatically be lowered to equal the maximum permitted rate
of interest. The Borrower covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead,
or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law or other law which would
prohibit or forgive the Borrower from paying all or any portion of the principal of or interest on this Note as contemplated herein,
wherever enacted, now or at any time hereafter in force, or which may affect the covenants or the performance of this Note.

 

Section
14.            Payment Dates; Payment Order of Priority. Whenever any payment or other obligation
hereunder shall be due on a day other than a Business Day, such payment shall be made on the next succeeding Business Day. All
payments received shall be applied in the following order of priority: (i) first to any amounts due to the Holder for the reimbursement
of any expenses or fees under any provision of this Note or the Transaction Documents, all of which shall be provided to the Borrower
in writing in sufficient detail prior the application of any payments for this purpose; and (ii) then amounts due to the Holder
for accrued but unpaid interest on this Note; and (iii) then, to principal of this Note.

 

Section
15.            WAIVER OF TRIAL BY JURY. THE PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVE THE RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON OR ARISING OUT OF, UNDER OR IN
CONNECTION WITH THIS AGREEMENT OR ANY TRANSACTION DOCUMENT OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL
OR WRITTEN) OR ACTIONS OF ANY PARTY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES’ ACCEPTANCE OF THIS AGREEMENT.

 

Section
16.            Governing Law. This Note shall be governed by and construed in accordance with the
laws of the State of Michigan, without giving effect to conflicts of laws thereof. Each of the parties consents to the jurisdiction
of the state courts of the State of Michigan sitting in Ingham County, Michigan and the U.S. District Court for the Western District
of Michigan in connection with any dispute arising under this Note and hereby waives, to the maximum extend permitted by law, any
objection, including any objection based on forum non conveniens to the bringing of any such proceeding in such jurisdictions.

 

Section
17.            Notices. Any notices, consents, waivers or other communications required
or permitted to be given under the terms hereof must be in writing and will be deemed to have been delivered: (a) upon receipt,
when delivered personally; (b) on the next Business Day following deposit of such notice with a nationally recognized overnight
delivery service; and (c) on the third Business Day following deposit of such notice with the U.S. Postal Service in an
envelope mailed Certified Mail. The addresses for such communications shall be:

 

	If to the Borrower, to:	XG Sciences, Inc.
	 	3101 Grand Oak Drive 
	 	Lansing, MI 48911
	 	Attention: Chief Financial Officer
	 	Telephone: 	 
	 	 
	With a copy to:	K&L Gates LLP
	 	200 South Biscayne Boulevard
	 	Miami, Florida 33131-2399
	 	Attention: Clayton E. Parker, Esq.
	 	Telephone: (305) 539-3306

 

    	9 

     

    

 

	If to the Holder:	Name:
	 	
        Address:

        Address:

	 	Attention: 
	 	Telephone: 

 

Such address and facsimile number and persons
to receive notice may be changed from time to time by either party providing written notice to the other party three (3) Business
Days prior to the effectiveness of such change. Written confirmation of receipt (i) given by the recipient of such notice,
consent, waiver or other communication, (ii) mechanically or electronically generated by the sender’s facsimile machine
containing the time, date, recipient facsimile number and an image of the first page of such transmission, (iii) provided
by a nationally recognized overnight delivery service, and (iv) the Certified Mail records of the U.S. Postal Service shall
constitute rebuttable evidence of personal receipt in accordance with this Section 17.

 

Section
18.           Entire Agreement. This Note, together with the other Transaction Documents, constitutes
and contains the entire agreement of the Borrower and the Holder with respect to the matters addressed herein and supersedes any
and all prior negotiations, correspondence, understandings and agreements between the Borrower and Holder respecting the subject
matter hereof.

 

[The Remainder of this Page Intentionally
Left Blank.]

 

    	10 

     

    

 

IN WITNESS WHEREOF,
the Borrower has caused this Note to be duly executed by a duly authorized officer as of the date set forth above.

 

	 	XG SCIENCES, INC.
	 	 	 
	 	By:	    
	 	Name:	 
	 	Title:	 
	 	 	 
	 	XG SCIENCES IP, LLC
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:     	Manager

 

    	11 

     

    

 

EXHIBIT A

 

NOTICE OF CONVERSION

 

(To be executed by the Holder in order
to convert this Note)

 

To: XG Sciences, Inc., 3101 Grand Oak Drive, Lansing, MI
48911, Attn: Chief Executive Officer

 

The undersigned hereby
irrevocably elects to convert $                            of
the outstanding principal and/or accrued interest of the above Note into the following Conversion Securities according to the conditions
stated therein, as of the Conversation Date written below.

 

	Conversion Date:	 	 
	 	 	 
	Applicable Note Conversion Price:	 	 
	 	 	 
	Signature:	 	 
	 	 	 
	Name:	 	 
	 	 	 
	Address:	 	 
	 	 	 
	Amount to be converted:	 	$____________________
	 	 	 
	Amount of Note unconverted:	 	$____________________
	 	 	 
	Note Conversion Price per share:	 	$____________________
	 	 	 
	Type and Number of Conversion Securities to be issued:	 	 
	 	 	 
	TYPE:___________________________________________	 	 
	 	 	 
	NUMBER:________________________________________	 	 
	 	 	 
	Please issue the Conversion Securities in the following name and to the following address:	 	 
	 	 	 
	Issue to:	 	 
	 	 	 
	Authorized Signature:_____________________________________________	 	 
	 	 	 
	Name:	 	 
	 	 	 
	Title:	 	 
	 	 	 
	Phone Number:	 	 

 

    	12Exhibit 10.3

 

CONFIDENTIALITY, NON-SOLICITATION AND
NON-COMPETE AGREEMENT

 

This Confidentiality,
Non-Solicitation and Non-Compete Agreement (the “Agreement”) dated this 26th day of August,
2020 is entered into by and between Robert Blinstrub, (“Employee”) and XG Sciences, Inc., a Michigan
corporation (“Employer” and collectively with any entity that is wholly or partially owned by the Employer
or otherwise affiliated with the Employer, the “Company”). Hereinafter, each of the Employee or the Company
may be referred to as a “Party” and together be referred to as the “Parties”.

 

RECITALS:

 

WHEREAS, the
Parties have entered into that certain Employment Agreement, of even date herewith, that creates an employment relationship between
the Employer and Employee (the “Employment Agreement”); and

 

WHEREAS, pursuant
to the Employment Agreement, the Employee agreed to enter into the Company’s Confidentiality, Non-Solicitation and Non-Compete
Agreement; and

 

WHEREAS, the
Company desires to protect and preserve its Confidential Information and its legitimate business interests by having the Employee
enter into this Agreement as part of the Employment Agreement; and

 

WHEREAS, the
Employee desires to establish and maintain an employment relationship with the Company and as part of such employment relationship
desires to enter into this Agreement with the Company; and

 

WHEREAS, the
Employee acknowledges that the terms of the Employment Agreement including, but not limited to the Company’s commitments
to the Employee with respect to base salary, fringe benefits and stock options are sufficient consideration to the Employee for
the entry into this Agreement.

 

WHEREAS, the
Employee acknowledges that substantial cost and expense has been or will be incurred by the Company in connection with the Employee’s
employment by the Company, and Employee’s employment will require the disclosure of certain Company confidential and proprietary
information, trade secrets and customer and supplier relationships.

 

WHEREAS, the
Employee has significant experience as a Chief Executive Officer, which the Company believes will be of benefit in the continuing
development of the Company’s business.

 

WHEREAS, the
Company has been involved in research, development, manufacture and sale of graphene nanoplatelets as evidenced, in part, by its
website and numerous published scientific papers and patents relating to graphene nanoplatelets and the production thereof.

 

NOW, THEREFORE,
in consideration of the mutual promises set forth herein and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Parties agree as follows:

 

1.            Term.
Employee agree(s) that the term of this Agreement is effective upon the Employee’s first day of employment with the Company
and, except as otherwise set forth in Paragraph 8, shall survive and continue to be in force and effect for four (4) years
following the termination of any employment relationship between the Parties (“Term”), whether termination
is by the Company with or without cause, or for any or no reason whatsoever, or by the Employee unless an exception is specifically
provided in certain situations in any such Restrictive Covenants.

 

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2.           Definitions.

 

a.       The
term “Confidential Information” as used herein shall include information, including a formula, pattern,
compilation, program, device, method, technique or process, or business practices that: (i) derives independent economic value,
actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who
can obtain economic value from its disclosure or use; and (ii) is the subject of efforts that are reasonable under the circumstances
to maintain its secrecy. Confidential Information also includes, but is not limited to, files, letters, memoranda, reports, records,
computer disks or other computer storage medium, data, models or any photographic or other tangible materials containing such information,
Customer lists and names and other information, Customer contracts, other corporate contracts, computer programs, proprietary manufacturing
practices and technical information, strategies, sales, promotional or marketing plans or strategies, programs, techniques, practices,
any expansion plans (including existing and entry into new geographic and/or product markets), pricing information, product or
service offering specifications or plans thereof, business plans, financial information and other financial plans, data pertaining
to the Company’s operating performance, employee lists, salary information, all information the Company receives from customers
or other third parties that is not generally known to the public or is subject to a confidentiality agreement, training manuals,
and other materials and business information of a similar nature, including information about the Company itself or any affiliated
entity, which Employee acknowledges and agrees has been compiled by the Company's expenditure of a great amount of time, money
and effort, and that contains detailed information that could not be created independently from public sources. Further, all data,
spreadsheets, reports, records, know-how, verbal communication, proprietary and technical information and/or other confidential
materials of similar kind transmitted by the Company to Employee or developed by the Employee on behalf of the Company as Work
Product (as defined in Paragraph 7) are expressly included within the definition of “Confidential Information.” The
Parties further agree that the fact the Company may be seeking to complete a business transaction is “Confidential Information”
within the meaning of this Agreement, as well as all notes, analysis, Work Product or other material derived from Confidential
Information. Nevertheless, Confidential Information shall not include any information of any kind which (1) is in the possession
of the Employee prior to the date of this Agreement, as shown by the Employee’s files and records, or (2) prior or after
the time of disclosure becomes part of the public knowledge or literature, not as a result of any violation of this Agreement,
any violation of any similar agreement with any other party or inaction or action of the receiving party, or (3) is rightfully
received from a third party without any obligation of confidentiality; or (4) independently developed after termination without
reference to the Confidential Information or materials based thereon; or (5) is disclosed pursuant to the order or requirement
of a court, administrative agency, or other government body; or (6) is approved for release by the non-disclosing party. It is
the intent of the definition to include confidential information related to the research, development, manufacture and sale of
graphene nanoplatelets which is not generally known to the public and to exclude information with Employee otherwise has developed
or obtained through his or her education, experience, and work in the field of Finance and Business Management.

 

b.       The
term “Customer” shall mean any person or entity which has purchased or ordered goods, products or services
from the Company and/or entered into any contract for products or services with the Company within the two (2) years immediately
preceding the termination of the Employee’s employment with the Company.

 

c.       
The term “Prospective Customer” shall mean any person or entity which has evidenced an intention to order
products or services with the Company within one year immediately preceding the termination of the Employee’s employment
with the Company.

 

d.       The
term “Restricted Area” shall include any geographical location anywhere in the United States as well
as those countries listed on Exhibit A attached hereto. If the Restricted Area specified in this Agreement should be judged unreasonable
in any proceeding, then the Restricted Area shall be reduced so that the restrictions may be enforced as is judged to be reasonable.

 

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e.       The
phrase “directly or indirectly” shall include the Employee either on his or her own account, or as a
partner, owner, promoter, joint venturer, employee, agent, consultant, advisor, manager, executive, independent contractor, officer,
director, or a stockholder of 5% or more of the voting shares of an entity in the Business of Company.

 

f.       The
term “Business” shall mean the business of researching, developing, manufacturing, or selling graphene
nanoplatelets and value-added products developed, manufactured or sold by the Company which contain graphene nanoplatelets.

 

		3.	Duty of Confidentiality.

 

a.       All
Confidential Information is considered highly sensitive and strictly confidential. The Employee agrees that at all times during
the Term of this Agreement and after the termination of employment with the Company for as long as such information remains non-public
information, the Employee shall (i) hold in confidence and refrain from disclosing to any other party all Confidential Information,
whether written or oral, tangible or intangible, concerning the Company and its business and operations unless such disclosure
is accompanied by a non-disclosure agreement executed by the Company with the party to whom such Confidential Information is provided,
(ii) use the Confidential Information solely in connection with his or her employment with the Company and for no other purpose,
(iii) take all reasonable precautions necessary to ensure that the Confidential Information shall not be, or be permitted to be,
shown, copied or disclosed to third parties, without the prior written consent of the Company, (iv) observe all security policies
implemented by the Company from time to time with respect to the Confidential Information, and (v) not use or disclose, directly
or indirectly, as an individual or as a partner, joint venturer, employee, agent, salesman, contractor, officer, director or otherwise,
for the benefit of himself or herself or any other person, partnership, firm, corporation, association or other legal entity, any
Confidential Information, unless expressly permitted by this Agreement. Employee agrees that protection of the Company’s
Confidential Information constitutes a legitimate business interest justifying the restrictive covenants contained herein. Employee
further agrees that the restrictive covenants contained herein are reasonably necessary to protect the Company’s legitimate
business interest in preserving its Confidential Information

 

b.       In
the event that the Employee is ordered to disclose any Confidential Information, whether in a legal or regulatory proceeding or
otherwise, such disclosure shall be limited to the narrowest disclosure, as practically as possible, so required and, except to
the extent prohibited by law, Employee shall give the Company at least two (2) weeks’ notice, if practicable, of the basis
for any such compelled disclosure of Confidential Information and shall reasonably cooperate with the Company in limiting disclosure
and obtaining suitable confidentiality protections.

 

c.       Employee
acknowledge(s) that this "Confidential Information" is of value to the Company by providing it with a competitive advantage
over their competitors, is not generally known to competitors of the Company, and is not intended by the Company for general dissemination.
Employee acknowledges that this "Confidential Information" derives independent economic value, actual or potential, from
not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value
from its disclosure or use, and is the subject of reasonable efforts to maintain its secrecy. Therefore, the Parties agree that
all "Confidential Information" under this Agreement constitutes “Trade Secrets” under Section
445.1902 of the Michigan Statutes.

 

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d.       Notice
of Immunity under the Economic Espionage Act of 1996, as amended by the Defend Trade Secrets Act of 2016 (“DTSA”).
Notwithstanding any other provision of this Agreement, Employee shall not be held criminally or civilly liable under any federal
or state trade secret law for any disclosure of a trade secret that: (a) is made: (1) in confidence to a federal, state, or local
government official, either directly or indirectly, or to an attorney; and (2) solely for the purpose of reporting or investigating
a suspected violation of law; or (b) is made in a complaint or other document that is filed under seal in a lawsuit or other proceeding.
Notwithstanding any other provision of this Agreement, if Employee files a lawsuit for retaliation by the Company for reporting
a suspected violation of law, Employee may disclose the Company’s trade secrets to Employee’s attorney and use the
trade secret information in the court proceeding if Employee: (x) files any document containing the trade secret under seal; and
(y) does not disclose the trade secret, except pursuant to court order.

 

4.            Limited
Right of Disclosure. Except as otherwise permitted by this Agreement, Employee shall limit disclosure of pertinent Confidential
Information to Employee’s attorney, if any (“Representative(s)”), for the sole purpose of evaluating
Employee’s relationship with the Company. Paragraph 3 of this Agreement shall bind all such Representative(s).

 

5.            Return
of Company Property and Confidential Materials. All tangible property, including cell phones, laptop computers and other
Company purchased property, as well as all Confidential Information, Customer and Prospective Customer information and property,
provided to Employee is the exclusive property of the Company and must be returned to the Company in accordance with the instructions
of the Company either upon termination of the Employee’s employment or at such other time as is requested by the Company.
Employee agree(s) that upon termination of employment for any or no reason whatsoever Employee shall return all copies, in whatever
form or media, including hard copies and electronic copies, of Confidential Information to the Company, and Employee shall delete
any copy of the Confidential Information on any computer file or database maintained by Employee and shall certify in writing that
he/she has done so. In addition to returning all Confidential Information to the Company as described above, Employee will destroy
any analysis, notes, work product or other materials relating to or derived from the Confidential Information.

 

6.            Agreement
Not to Circumvent. Employee agrees not to pursue any transaction or business relationship that is directly competitive
to the Business of the Company that makes use of any Confidential Information during the Term of this Agreement, other than through
the Company or on behalf of the Company. It is further understood and agreed that, after the Employee’s employment with the
Company has been terminated, the Employee will direct all communications and requests from any third parties regarding Confidential
Information or Business opportunities which use Confidential Information through the Company’s then chief executive officer
or president. Employee acknowledges that any violation of this covenant may subject Employee to the remedies identified in Paragraph
9 in addition to any other available remedies.

 

7.            Title
to Work Product. Employee agrees that all work products (including strategies, manufacturing processes, products and planned
products for competing in the graphene industry, technical materials and diagrams, computer programs, financial plans and other
written materials, websites, presentation materials, course materials, advertising campaigns, slogans, videos, pictures and other
materials) created or developed by the Employee for the Company during the term of the Employee’s employment with the Company
or any successor to the Company until the date of termination of the Employee (collectively, the “Work Product”),
shall be considered a work made for hire and that the Company shall be the sole owner of all rights, including copyright, in and
to the Work Product.

 

If the Work Product,
or any part thereof, does not qualify as a work made for hire, the Employee agrees to assign, and hereby assigns, to the Company
for the full term of the copyright and all extensions thereof all of its right, title and interest in and to the Work Product.
All discoveries, inventions, innovations, works of authorship, computer programs, improvements and ideas, whether or not patentable
or copyrightable or otherwise protectable, conceived, completed, reduced to practice or otherwise produced by the Employee in the
course of his or her services to the Company in connection with or in any way relating to the Business of the Company or capable
of being used or adapted for use therein or in connection therewith shall forthwith be disclosed to the Company and shall belong
to and be the absolute property of the Company unless assigned by the Company to another entity.

 

    	 	 	EMPLOYEE’S INITIALS
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Employee hereby
assigns to the Company all right, title and interest in all of the discoveries, inventions, innovations, works of authorship, computer
programs, improvements, ideas and other work product; all copyrights, trade secrets, and trademarks in the same; and all patent
applications filed and patents granted worldwide on any of the same for any work previously completed on behalf of the Company
or work performed under the terms of this Agreement or the Employment Agreement. Employee, if and whenever required to do so (whether
during or after the termination of his or her employment), shall at the expense of the Company apply or join in applying for copyrights,
patents or trademarks or other equivalent protection in the United States or in other parts of the world for any such discovery,
invention, innovation, work of authorship, computer program, improvement, and idea as aforesaid and execute, deliver and perform
all instruments and things necessary for vesting such patents, trademarks, copyrights or equivalent protections when obtained and
all right, title and interest to and in the same in the Company absolutely and as sole beneficial owner, unless assigned by the
Company to another entity. Notwithstanding the foregoing, work product conceived by the Employee, which is not related to the Business
of the Company, will remain the property of the Employee.

 

8.            Restrictive
Covenant. The Company and its affiliated entities are engaged in the Business of researching, developing, manufacturing,
and selling graphene nanoplatelets and value-added products which contain graphene nanoplatelets. The covenants contained in this
Paragraph 8 (the “Restrictive Covenants”) are given and made by Employee to induce the Company to employ
Employee under the terms of the Employment Agreement, and Employee acknowledges sufficiency of consideration for these Restrictive
Covenants. Employee expressly covenants and agrees that, during the Restrictive Period (as defined below), he/she will abide by
the following restrictive covenants unless an exception is specifically provided, in writing signed by Company, in certain situations
in such Restrictive Covenants.

 

		a.	Non-Solicitation. Employee agrees and acknowledges that, during the Restrictive Period,
he/she will not, directly or indirectly, in one or a series of transactions, as an individual or as a partner, joint venturer,
employee, agent, salesperson, contractor, officer, director or otherwise, for the benefit of himself or herself or any other person,
partnership, firm, corporation, association or other legal entity:

 

		(i)	solicit or induce, or attempt to solicit or induce, any Customer or Prospective Customer of the
Company to patronize or do business with any other company (or business) that is in the Business conducted by the Company in the
Restricted Area; or

 

		(ii)	request or advise any Customer, supplier or vendor, or any Prospective Customer, prospective supplier
or prospective vendor, of the Company, who was a Customer, Prospective Customer, supplier, prospective supplier, vendor or prospective
vendor within one (1) year immediately preceding the termination of the Employee’s employment with the Company, to withdraw,
curtail, cancel or refrain from doing business with the Company in any capacity related to the Business; or

 

		(iii)	manage, operate, be connected with, employed by, or on behalf of, in any manner, any Customer,
or Prospective Customer, of the Company in any capacity related to the Business, either myself or on behalf of any other entity
that may employ, engage or associate with me in any fashion.

 

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		(iv)	sell goods related to the Business to, or perform services related to the Business for, or on behalf
of, in any manner, any Customer, or Prospective Customer, of the Company either myself or on behalf of any other entity that may
employ, engage or associate with me in any fashion.

 

		(v)	recruit, solicit or otherwise induce any proprietor, partner, stockholder, lender, director, officer,
sales agent, joint venturer, investor, lessor, supplier, Customer, agent, representative, or any other person which has an agency
or business relationship with the Company or any affiliated entity to discontinue, reduce or detrimentally modify such agency or
business relationship with the Company.

 

		(vi)	employ, recruit or solicit, or attempt to employ, recruit or solicit, for employment any person
or agent who is then (or was at any time within twelve (12) months prior to the date Employee or any entity related to Employee
seeks to employ such person) employed or retained by the Company. Notwithstanding the forgoing, (A) to the extent the Employee
works for a firm or corporation after his or her termination from the Company and he or she does not have any personal knowledge
and/or control over the solicitation of or the employment of a Company employee or agent, then this provision shall not be enforceable
as it relates to that employee or agent, and (B) nothing contained herein shall prevent Employee or his affiliates from employing
any person who, without any encouragement, direction, or communication by Employee or his affiliates, responds to a general media
advertisement or non-directed search inquiry (including the use of employment agencies provided no direction was given to target
an employee of the Company).

 

		b.	Non-Competition. Employee agrees and acknowledges that, during the Restrictive Period,
he or she will not, directly or indirectly, for himself , or on behalf of others, as an individual on Employee's own account, or
as a partner, joint venturer, employee, agent, salesman, contractor, officer, director or otherwise, for him/herself or any other
person, partnership, firm, corporation, association or other legal entity, enter into, engage in, accept employment from,
or provide any services to, or for, any business that is in the Business of the Company, or engage in any activity that is
competitive with the Company in the Business and in the Restricted Area. The parties agree that this non-competition provision
is intended to cover situations where a future business opportunity in which the Employee is engaged or a future employer of the
Employee is selling the same or similar products and services in a Business which may compete with the Company’s products
and services to Customers and Prospective Customers of the Company in the Restricted Area. This provision shall not cover future
business opportunities or employers of the Employee that sell different types of products or services in the Restricted Area so
long as such future business opportunities or employers are not in the Business of the Company or if the Employee is not involved
in the activities of the future employer or related to the Business of the Company. This provision is not intended to prohibit
Employee from returning to employment in the field of marketing and general management, especially in thermosets and composites.
It is intended to prohibit Employee from accepting employment in a business that directly competes with Business of the Company.

 

		c.	Restrictive Period. As used in this Agreement, “Restrictive Period”
means the period of Employee’s employment and for a period of two (2) years following termination of such employment for
any reason, provided that any such Restrictive Period shall automatically and immediately terminate upon any dissolution, liquidation
or voluntary or involuntary case seeking the dissolution, liquidation or reorganization of the Company under the bankruptcy or
other similar laws are any similar proceeding seeking the appointment of a receiver or similar official for the Company or to take
possession of all or a substantial portion of its property or to operate all or a substantial portion of its business.

 

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		9.	Acknowledgements of Employee.

 

		a.	The Employee understands and acknowledges that any violation of this Agreement shall constitute
a material breach of this Agreement and the Employment Agreement, and it may cause irreparable harm and possible loss to the Company
for which monetary damages may be an insufficient remedy. Therefore, the Parties agree that in addition to any other remedies available,
the Company will be entitled to the relief identified in Paragraph 10 below.

 

		b.	The Restrictive Covenants shall be construed as agreements independent of any other provision in
this Agreement and the existence of any claim or cause of action of Employee against the Company shall not constitute a defense
to the enforcement of these Restrictive Covenants.

 

		c.	Employee agrees that the Restrictive Covenants are reasonably necessary to protect the legitimate
business interests of the Company.

 

		d.	Employee agrees that this Agreement may be enforced by the Company’s successor in interest
by way of merger, business combination or consolidation where a majority of the surviving entity is not owned by Company’s
shareholders who owned a majority of the Company’s voting shares prior to such transaction and Employee acknowledges and
agrees that successors are intended beneficiaries of this Agreement.

 

		e.	Employee agrees that if any portion of the Restrictive Covenants is held by a court of competent
jurisdiction to be unreasonable, arbitrary or against public policy for any reason, such shall be modified accordingly as to time,
geographic area and line of business so as to be enforceable to the fullest extent possible as to time, area and line of business.

 

		f.	Employee acknowledges that any violations of the Agreement will be a material breach of this Agreement
and may subject the Employee, and/or any individual(s), partnership, corporation, joint venture or other type of business with
whom the Employee is then affiliated or employed, to monetary and other damages.

 

		g.	Employee agrees that any failure of the Company to enforce the Restrictive Covenants against any
other employee, for any reason, shall not constitute a defense to enforcement of the Restrictive Covenants against the Employee.

 

10.         Specific
Performance; Injunction. The Parties agree and acknowledge that the restrictions contained in Paragraphs 1-8 are
reasonable in scope and duration and are necessary to protect the Company. If any provision of Paragraphs 1-8 as applied
to any party or to any circumstance is judged by a court to be invalid or unenforceable, the same shall in no way affect any other
circumstance or the validity or enforceability of any other provision of this Agreement. If any such provision, or any part thereof,
is held to be unenforceable because of the duration of such provision or the area covered thereby, the court making such determination
shall have the power to reduce the duration and/or area of such provision, and/or to delete specific words or phrases, and in its
reduced form, such provision shall then be enforceable and shall be enforced.

 

Any unauthorized use
or disclosure of Confidential Information in violation of Paragraphs 2-7 above or violation of the Restrictive Covenant
in Paragraph 8 shall constitute a material breach of this Agreement and may cause irreparable harm and potential loss to
the Company for which monetary damages may be an insufficient remedy. Therefore, in addition to any other remedy available, the
Company will be entitled to all available civil remedies, including:

 

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		a.	Temporary and permanent injunctive relief, without the necessity of posting a bond, restraining
Employee or Representatives and any other person, partnership, firm, corporation, association or other legal entity acting in concert
with Employee from any actual or threatened unauthorized disclosure or use of Confidential Information, in whole or in part, or
from rendering any service to any other person, partnership, firm, corporation, association or other legal entity to whom such
Confidential Information in whole or in part, has been disclosed or used or is threatened to be disclosed or used; and

 

		b.	Temporary and permanent injunctive relief, without the necessity of posting a bond, restraining
the Employee from violating, directly or indirectly, the restrictions of the Restrictive Covenant in any capacity identified in
Paragraph 8, supra, and restricting third parties from aiding and abetting any violations of the Restrictive Covenant; and

 

		c.	Compensatory damages, including actual loss from misappropriation and unjust enrichment, and any
and all legal fees, including without limitation, all attorneys’ fees, court costs, and any other related fees and/or costs
incurred by the Company in enforcing this Agreement.

 

Notwithstanding the
forgoing, the Company acknowledges and agrees that the Employee will not be liable for the payment of any damages or fees owed
to the Company through the operation of Paragraph 10c above, unless and until a court of competent jurisdiction has determined
that the Company or any successor is entitled to such recovery.

 

Nothing in this Agreement
shall be construed as prohibiting the Company from pursuing any other legal or equitable remedies available to it for actual or
threatened breach of the provisions of Paragraphs 1 – 8 of this Agreement, and the existence of any claim or cause
of action by Employee against the Company shall not constitute a defense to the enforcement by the Company of any of the provisions
of this Agreement. The Company and its affiliates have fully performed all obligations entitling it to the covenants of Paragraphs
1 – 8 of this Agreement and therefore such prohibitions are not executory or otherwise subject to rejection under the bankruptcy
code.

 

11.          Duty
to Disclose Agreement and to Report New Employer. Employee acknowledges that the Company has a legitimate business purpose
in the protection of its Confidential Information. Employee also recognizes and agrees that the Company has the right to such information
as is reasonably necessary to inform the Company whether the terms of this Agreement are being complied with. Accordingly, Employee
agrees that Employee will promptly notify any new employer of his or her obligations contained here. Employee also will provide
the Company with the identity of his or her new employer(s) and a description of the services being provided by him/her in sufficient
detail to allow the Company to reasonably determine whether such activities fall within the scope of activities prohibited by the
provisions of this Agreement

 

12.          Representations
as to Prior or Other Agreements. Employee represents and warrants that he/she is able to perform the contemplated duties
of employment without being in breach of confidentiality agreements or disclosing proprietary information of any third party, and
that no proprietary information of any third party shall be disclosed to the Company. Employee further represents and warrants
that he/she is not prohibited from entering into this Agreement or performing services under it by any non-competition, non-solicitation,
anti-piracy agreement, relationship agreement, or any other restrictions. Employee agrees to indemnify and hold the Company harmless
from all claims or causes of action by any person or entity against the Company arising out of any alleged breach by Employee of
any such agreement or any other restrictions inconsistent with the foregoing representations.

 

13.          Company
Use of Employee Name, Image and Voice. The Company may use and publish Employee’s name and picture, including audio
or video tape recordings, for purposes relating to its business without a specific release from Employee.

 

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14.          Termination.
Employee agrees to bring any claims that he/she may have against the Company within one hundred eighty (180) days of the day that
Employee knew, or should have known, of the facts giving rise to the cause of action and waives any longer, but not shorter, statutory
or other limitations periods. This includes, but is not limited to, the initial filing of a charge with the Equal Employment Opportunity
Commission and/or state equivalent civil rights agency. However, Employee understands that he/she will thereafter have the right
to pursue any claim in the manner prescribed in any right to sue letter that is issued by an agency.

 

15.           Nondisparagement.
Employee shall not make any disparaging or defamatory comments about the Company, whether true or not, except to comply with any
summons, court order or subpoena. Company shall not make any disparaging or defamatory comments about the Company, whether true
or not, except to comply with any summons, court order or subpoena. However, nothing in this Paragraph 15 shall prohibit
any party from testifying truthfully in any proceeding or providing truthful information as legally required to provide such information
in connection with this Agreement or otherwise.

 

16.           Waiver
of Jury Trial. THE COMPANY AND EMPLOYEE EACH WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND
ANY RIGHTS UNDER THIS AGREEMENT OR UNDER ANY INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED IN CONNECTION HEREWITH OR HEREAFTER OR
RELATED IN ANY FASHION TO EMPLOYEE’S EMPLOYMENT WITH COMPANY.

 

17.          Governing
Law, Venue and Personal Jurisdiction. This Agreement shall be governed by, construed and enforced in accordance with the
laws of state of Michigan without regard to any statutory or common-law provision pertaining to conflicts of laws. The parties
agree that courts of competent jurisdiction in Ingham County, Michigan and the United States District Court for the Western District
of Michigan shall have concurrent jurisdiction for purposes of entering temporary, preliminary and permanent injunctive relief
and with regard to any action arising out of any breach or alleged breach of this Agreement. Employee waives personal service of
any and all process upon Employee and consents that all such service of process may be made by certified or registered mail directed
to Employee at the address stated in the signature section of this Agreement, with service so made deemed to be completed upon
actual receipt thereof. Employee waives any objection to jurisdiction and venue of any action instituted against Employee as provided
herein and agrees not to assert any defense based on lack of jurisdiction or venue. Employee further agrees that any action arising
out of this Agreement or the relationship between the parties established herein shall be brought only in courts of competent jurisdiction
in Ingham County, Michigan or the United States District Court for the Western District of Michigan.

 

18.          Successors
and Assigns. This Agreement will be binding upon and inure to the benefit of the Parties and their respective successors,
permitted assigns and, in the case of Employee, heirs, executors, and/or personal representatives. The Company may freely assign
or transfer this Agreement to an affiliated company or to a successor following a merger, consolidation, sale of assets, or other
business transaction. Executive may not assign, delegate or otherwise transfer any of Executive’s rights, interests
or obligations in this Agreement without the prior written approval of the Company.

 

19.          Entire
Agreement. This Agreement is the entire agreement of the Parties with regard to the matters addressed herein, and supersedes
all prior negotiations, preliminary agreements, and all prior and contemporaneous discussions and understandings of the signatories
in connection with the subject matter of this Agreement, except however, that this Agreement shall be read in pari materia
with the Employment Agreement executed by Employee. This Agreement may be modified only by written instrument which is signed by
the Company and Employee and which describes such modification.

 

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20.           Severability.
In case any one or more provisions contained in this Agreement shall, for any reason, be held invalid, illegal or unenforceable
in any respect, such invalidity, illegality or unenforceability shall not affect any other provision hereof and this Agreement
shall be construed as if such invalid, illegal or unenforceable provision had not been contained herein.

 

21.           Waiver.
The waiver by the Company of a breach or threatened breach of this Agreement by Employee cannot be construed as a waiver of any
subsequent breach by Employee unless such waiver so provides by its terms. The refusal or failure of the Company to enforce any
specific restrictive covenant in this Agreement against Employee, or any other person for any reason, shall not constitute a defense
to the enforcement by the Company of any other restrictive covenant provision set forth in this Agreement.

 

22.          Consideration.
Employee acknowledges and agrees that the execution by the Company of the Employment Agreement with the Employee constitutes
full, adequate and sufficient consideration to Employee for the covenants of Employee under this Agreement.

 

23.           Notices.
All notices required by this Agreement shall be in writing, shall be personally delivered or sent by U.S. Registered or Certified
Mail, return receipt requested, and shall be addressed to the signatories at the addresses shown on the signature page of this
Agreement.

 

24.           Acknowledgements.
Employee acknowledge(s) that he or she has reviewed this Agreement prior to signing it, that he or she knows and understands
the contents, purposes and effect of this Agreement, and that he or she has been given a signed copy of this Agreement for his
or her records. Employee further acknowledges and agrees that he or she has entered into this Agreement freely, without any duress
or coercion.

 

25.          Captions.
Captions to paragraphs and sections of this Agreement have been included solely for the sake of convenient reference and are
entirely without substantive effect.

 

26.         Counterparts.
This Agreement may be executed in counterparts, by facsimile or Adobe Acrobat pdf file each of which shall be deemed an original
for all intents and purposes.

 

[Signatures Appear
on the Following Page]

 

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IN WITNESS WHEREOF,
THE UNDERSIGNED STATE THAT THEY HAVE CAREFULLY READ THIS AGREEMENT AND KNOW AND UNDERSTAND THE CONTENTS THEREOF AND THAT THEY AGREE
TO BE BOUND AND ABIDE BY THE REPRESENTATIONS, COVENANTS, PROMISES AND WARRANTIES CONTAINED HEREIN.

 

	By:	/s/ Robert Blinstrub	8/26/20	 	 
	 	Employee Signature	Date	 	 

 

	Employee Name:	Robert Blinstrub	 
	 	 	 
	Employee Address:	 	 

 

XG Sciences,
Inc.

3101 Grand
Oak Drive

Lansing, MI
48911

 

	By:	/s/Steven C. Jones	8/26/20	 
	 	 	Date	 
	 	 	 	 
	Name:	Steven C. Jones	 	 
	 	 	 	 
	Title:	Authorized
Representative	 	 

 

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EXHIBIT A

Countries Covered Under Definition of Restricted
Area in Section 2(d)

 

The following list of countries is deemed to include any dependent
territories or other areas recognized as a constituent country or municipality of each of the countries listed

 

	
        Asia

        Bahrain

        Brunei

        China (including Hong Kong & Taiwan)

        Cyprus

        Georgia

        India

        Indonesia

        Israel

        Japan

        Kuwait

        Malaysia
	
         

        Oman

        Philippines

        Qatar

        Russia

        Saudi Arabia

        Singapore

        South Korea

        Thailand

        Turkey

        United Arab Emirates

        Vietnam

	 	 
	
        Europe

        Austria

        Belgium

        Bulgaria

        Croatia

        Cyprus

        Czech Republic

        Denmark

        Estonia

        Finland

        France

        Germany

        Greece

        Hungary

        Iceland

        Ireland

        Italy
	
         

        Latvia

        Lithuania

        Luxembourg

        Malta

        Monaco

        Montenegro

        Netherlands

        Poland

        Portugal

        Romania

        Slovakia

        Slovenia

        Spain

        Sweden

        United Kingdom

         

	
         
	 
	
        South America

        Argentina

        Brazil

        Chile

        Columbia

        Ecuador
	
         

        Paraguay

        Peru

        Uruguay

        Venezuela

 

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        North America, Central America & Caribbean

        Antigua & Barbuda

        Bahamas

        Barbados

        Belize

        Canada

        Costa Rica

        Dominica

        Dominican Republic

        El Salvador

        Grenada

        Guatemala
	
         

        Honduras

        Jamaica

        Mexico

        Nicaragua

        Panama

        Saint Kitts & Nevis

        Saint Lucia

        Saint Vincent and the Grenadines

        Trinidad and Tobago

        United States of America

         

	 	 
	
        Africa

        Canary Islands

        Egypt

        Morocco

        South Africa
	 
	 	 
	
        Oceania

        Australia

        New Zealand
	 

 

    	 	 	EMPLOYEE’S INITIALS
	 	 13

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00313-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00313-of-00352.parquet"}]]