Document:

Exhibit

EXHIBIT 10.1

SEVERANCE AGREEMENT
AND GENERAL RELEASE OF CLAIMS

This Severance Agreement and General Release of Claims (“Severance Agreement” or “Agreement”) is made and entered into by and between DAVID MARTENS (hereinafter, "MR. MARTENS") and the FEDERAL HOME LOAN BANK OF SAN FRANCISCO (hereinafter, "THE BANK").
W I T N E S S E T H:
WHEREAS, MR. MARTENS, is presently an employee of THE BANK and he will retire on March 31, 2017; 
WHEREAS, MR. MARTENS and THE BANK desire to ensure that MR. MARTENS’ employment relationship ends in an amicable way, settling fully and finally any and all differences between them that have been, or could have been, raised in connection with any aspect of MR. MARTENS’ employment with THE BANK;
WHEREAS, MR. MARTENS has been offered severance benefits by THE BANK, as outlined on Exhibit I, and understands that any severance benefits provided to him are not benefits to which he is entitled as an employee of THE BANK but consideration being offered in exchange for his release of claims;
NOW, THEREFORE, in consideration of the mutual covenants and promises herein contained and other good and valuable consideration, receipt of which is hereby acknowledged, and to avoid any cause for dispute, it is hereby agreed by and between the parties as follows:

	
		
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FIRST:    Nothing in this Agreement prohibits MR. MARTENS from filing a charge or complaint with, or participating in any investigation or proceeding by any federal, state, or local governmental agency or commission (“Government Agencies”).  Nor does this Agreement prohibit MR. MARTENS  from exercising any rights he may have under Section 7 of the National Labor Relations Act.  MR. MARTENS further understands that this Agreement does not limit his ability to communicate with any Government Agencies or otherwise participate in any investigation or proceeding that may be conducted by any Government Agency, including providing documents or other information without notice to THE BANK.  This Agreement does not limit MR. MARTENS’ right to receive an award for information provided to any Government Agencies.
SECOND:    This Agreement and compliance with this Agreement shall not be construed as an admission by THE BANK of any wrongdoing or liability whatsoever, or as an admission by THE BANK of any violation of the rights of MR. MARTENS or any other person, or the violation of any order, law, statute, duty, or contract whatsoever relating to MR. MARTENS or any other person, or any entitlement by MR. MARTENS to severance benefits.  THE BANK specifically disclaims any wrongdoing or liability to MR. MARTENS or any other person for any alleged violation of the rights of MR. MARTENS or any other person, or for any alleged violation of any order, law, statute, duty, or contract on the part of THE BANK.
THIRD:    (a) Within ten (10) days after the Effective Date, as defined in the NINETEENTH Paragraph of this Agreement, and following (i) THE BANK’s receipt of  MR. MARTENS’ signature on this Agreement; (ii) the expiration of the seven (7) day revocation period (as referenced below); (iii) MR. MARTENS’ return to THE BANK of 

	
		
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all documents, information and data, and copies of documents, information and data (whether in electronic or hard copy form), relating in any way to THE BANK in the possession, custody or control of MR. MARTENS; and, (iv) MR. MARTENS’ return to THE BANK of all equipment, tools, software, computers, cell phones, PDA’s or any similar equipment belonging to THE BANK, THE BANK shall provide a severance payment to MR. MARTENS in the gross amount of $394,100, less all applicable federal and state deductions.  The calculation of severance is attached as Exhibit I.  
(b) The parties agree that payment of the foregoing severance amount constitutes a full and complete settlement of any current or potential claims by MR. MARTENS against THE BANK, except as otherwise provided in the FIRST Paragraph above or the SIXTH Paragraph below.
(c) MR. MARTENS agrees that the foregoing severance payment shall constitute the entire amount of monetary consideration provided to him under this Agreement and that he will not seek any further compensation for any other claimed damages, costs, or attorneys’ fees in connection with the matters encompassed by this Agreement.  
(d) MR. MARTENS understands and agrees that he shall be solely responsible for the payment of all federal, state or local taxes due as a result of the payment made pursuant to this Agreement with the exception of the applicable payroll taxes THE BANK will withhold from the severance amount.  MR. MARTENS further agrees to indemnify and to hold THE BANK harmless for any and all liability for taxes, interest or penalties owed by MR. MARTENS that might be assessed by any federal, state or local taxing authority relating to the severance amount.

	
		
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FOURTH:    MR. MARTENS represents that he has not filed any complaints, claims, or actions against THE BANK, with any state, federal, or local agency or court and that, except as otherwise provided in the FIRST Paragraph above, he will not do so at any time hereafter.  
FIFTH:    In consideration for the promises contained herein, and after the opportunity to consult with counsel, MR. MARTENS, on behalf of himself, his family, and his heirs and executors/administrators, completely releases and forever discharges any and all actual or potential claims, liabilities, demands, or causes of action, known or unknown, fixed or contingent, that he may have or claim to have, against THE BANK, including any and all of its past, present, and future direct and indirect parents, subsidiaries, affiliates, representatives, related entities, successors, assigns, officers, directors, managing agents, agents, managers, employees, contractors, insurers, consultants, benefit plans, benefit committees, attorneys and stockholders, as well as the heirs, executors, administrators, attorneys, insurers, predecessors, successors, and assigns of the foregoing (hereinafter referred to as “RELEASED PARTIES”), whether known or unknown, of whatever nature, which exist or may exist on his behalf at any time up to and including the Effective Date of this Agreement, except as otherwise provided in the FIRST Paragraph above or SIXTH Paragraph below.  As used in this Section, and except as otherwise provided in the FIRST Paragraph above or SIXTH Paragraph below, “claims,” “liabilities,” “demands,” and “causes of action” include, but are not limited to, claims based on contract, whether oral, express or implied, fraud, misrepresentation, defamation, wrongful termination, constructive discharge, promissory estoppel, equitable estoppel, equity, tort, retaliation, intellectual property, personal injury, spoliation of evidence, breach  of any policy of THE BANK, including its severance policy and 

	
		
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including any and all benefit plans in which MR. MARTENS has participated, emotional distress, public policy, wage and hour law, statute or common law, claims for severance pay, claims for attorneys’ fees, vacation pay, debts, accounts, compensatory damages, punitive or exemplary damages, liquidated damages, and any and all claims arising under any federal, state, or local statute, law, or ordinance prohibiting discrimination or harassment on any account, including but not limited to, the Fair Employment and Housing Act (FEHA), Title VII of the Civil Rights Act of 1964, as amended, the Fair Labor Standards Act, the Equal Pay Act of 1963, the California Labor Code, the California Wage Orders, the Americans with Disabilities Act, the Family and Medical Leave Act, the Genetic Information Non-Discrimination Act, the California Family Rights Act, the Consolidated Omnibus Budget Reconciliation Act of 1985, the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act, the Employee Retirement Income Security Act of 1974, the Securities Act of 1993 (and all rules and regulations thereunder) and any other local, state, and/or federal law.  MR. MARTENS will not file, cause to be filed or pursue any released claims against THE BANK, in his individual or any other capacity, nor shall he voluntarily assist any other person who is pursuing a claim against THE BANK, except as otherwise provided in the FIRST Paragraph above or the SIXTH Paragraph below.  
SIXTH:    Notwithstanding the release language in the FIFTH Paragraph, above, MR. MARTENS does not release or waive any claims he may have to benefits provided under: 
(i) the terms and conditions of THE BANK’s retirement benefit plans in which he is presently a participant including, but not limited to, the  Federal Home Loan Bank of San Francisco’s Cash Balance Plan, the Savings Plan, the Original Benefit 

	
		
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Equalization Plan, the Benefit Equalization Plan, the Supplemental Executive Retirement Plan, the Original Deferred Compensation Plan, the Deferred Compensation Plan and the Financial Institutions Retirement Fund [FIRF], as well as any of THE BANK’s short term or long term incentive plans in which he is participating including, but not limited to, the 2017 Executive Incentive Plan (including the Annual Award and Deferred Award components and the 2017-2019 Gap Year component), 2015-2017 Executive Performance Unit Plan and 2016-2018 Executive Performance Unit Plan; 
(ii) THE BANK’s post-retirement health continuation coverage, in which he is eligible to participate at his own expense (to the extent the  benefit continues to be offered by THE BANK to retirees in the future, which shall be at the sole discretion of THE BANK); 
(iii) the Indemnification Agreements between THE BANK and MR. MARTENS dated June 3, 2016, December 16, 2008, and November 23, 1998; and 
(iv) any compensation THE BANK owes MR. MARTENS that is deferred by MR. MARTENS.
SEVENTH:    MR. MARTENS agrees and covenants that no actions will be brought in any forum for any claims against RELEASED PARTIES, or any of them, relating to his employment at THE BANK, the termination of his employment, or any other claim described in the FIFTH Paragraph, above, except as otherwise provided in the FIRST Paragraph above or the SIXTH Paragraph above.  MR. MARTENS further agrees that damages for violation of this covenant shall be the reasonable costs incurred by RELEASED PARTIES, or any of them, in defending such actions, including reasonable attorneys’ fees, or the amount of his severance payment, whichever is less.  

	
		
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EIGHTH:    MR. MARTENS understands and agrees that this Agreement extends to all claims of every nature and kind whatsoever, known or unknown, suspected or unsuspected, past or present, which MR. MARTENS has or may have against RELEASED PARTIES that arose or accrued at any time up to and including the Effective Date of this Agreement, except as otherwise provided in the FIRST Paragraph above or the SIXTH Paragraph above.  MR. MARTENS thus expressly waives all rights under Section 1542 of the California Civil Code.  Section 1542 provides as follows:
	
	
	A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.

MR. MARTENS understands and acknowledges that he may hereafter discover facts different from or in addition to those that he now believes to be true with respect to the matters released in this Agreement.  MR. MARTENS assumes any and all risk of mistake (or discovery of additional facts) in connection with the circumstances involved in the matters giving rise to this Agreement.
NINTH:    (a) As a condition of his severance benefits, MR. MARTENS reaffirms his obligation to maintain the confidentiality of all confidential information that belongs to THE BANK.  Except as otherwise provided in the FIRST Paragraph above, he agrees not to disclose such information to anyone outside of THE BANK after his employment with THE BANK ends, except by written consent of THE BANK or production of such information in compliance with applicable law, a subpoena or a court order, provided THE BANK is given prompt notice of the need to produce information.   MR. MARTENS understands that this obligation applies with equal force to such confidential information of third parties obtained by him by some reason of his 

	
		
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employment with THE BANK.  Nothing in this paragraph shall be deemed to prevent MR. MARTENS from making disclosures required or made permissible by applicable statute or regulation.  This paragraph shall also not be deemed to prevent MR. MARTENS from making any disclosure required by agency or court order without prior notice to THE BANK to the extent such prior notice is prohibited by applicable law.
(b) MR. MARTENS agrees to return to THE BANK all memoranda, notes, records, reports, manuals, drawings, software and any other documents or data of a confidential nature belonging to THE BANK, including, all copies of such material which he possesses or has under his control.  MR. MARTENS agrees to return to THE BANK all equipment, tools, software, computers, cell phones, PDA’s or any similar equipment belonging to THE BANK that were ever in MR. MARTENS’ possession or under MR. MARTENS’ control.
(c) MR. MARTENS understands that THE BANK shall be entitled to injunctive relief and all costs and expenses as may be incurred in the event of any breach of this provision, including reasonable costs, expenses and attorneys’ fees incurred in prosecuting or defending against any claims based hereon.
TENTH:     MR. MARTENS agrees that he will not do or say anything in the future to disparage or otherwise impugn the commercial or personal reputation of THE BANK, or any of its officers, directors, employees and/or agents, except as is otherwise provided in the FIRST Paragraph above.  
ELEVENTH:     This Agreement shall be binding upon the parties hereto and upon their heirs, administrators, representatives, executors, successors, and assigns, and shall inure to the benefit of said parties and each of them and to their heirs, administrators, representatives, executors, successors, and assigns.  MR. MARTENS 

	
		
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expressly warrants that he has not transferred to any person or entity any rights, causes of action, or claims released in this Agreement and that he is not a petitioner in bankruptcy, nor has he been adjudicated to be bankrupt, and that he is fully empowered to enter into this Agreement.
TWELFTH:    MR. MARTENS represents that he has carefully read and fully understands all the provisions of this Agreement, that he understands that in agreeing to this document, he is releasing RELEASED PARTIES from any and all claims he may have against RELEASED PARTIES, or any of them, except as otherwise provided in the FIRST Paragraph or the SIXTH Paragraph above, that he voluntarily agrees to all the terms set forth in this Agreement, that he knowingly and willingly intends to be legally bound by the same, that he considered the terms of this Agreement and had an opportunity to discuss them with an attorney.
THIRTEENTH:    MR. MARTENS represents and acknowledges that in executing this Agreement, he does not rely and has not relied upon any representation or statement made by THE BANK or by any of THE BANK’S agents, attorneys, or representatives with regard to the subject matter, basis, or effect of this Agreement or otherwise, other than those specifically stated in this written Agreement.
FOURTEENTH:    MR. MARTENS represents and acknowledges that he has been paid for all hours worked on behalf of THE BANK and has been reimbursed for all business expenses incurred in relation to his work for THE BANK, and that THE BANK does not owe him any wages or other remuneration or reimbursement except as set forth in this Agreement.
FIFTEENTH:    Should any provision of this Agreement be declared or be determined by any court of competent jurisdiction to be wholly or partially illegal, 

	
		
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invalid, or unenforceable, the legality, validity, and enforceability of the remaining parts, terms, or provisions shall not be affected thereby, and said illegal, unenforceable, or invalid part, term, or provision shall be deemed not to be a part of this Agreement.
SIXTEENTH:    This Severance Agreement sets forth the entire agreement between the parties hereto and fully supersedes any and all prior agreements or understandings, written or oral, between the parties hereto pertaining to the subject matter hereof.
SEVENTEENTH:    This Agreement shall be interpreted in accordance with the plain meaning of its terms and not strictly for or against any of the parties hereto.
EIGHTEENTH:    MR. MARTENS understands that this Agreement is subject to review by  the Federal Housing Finance Agency (“the Finance Agency”) and that the Finance Agency has completed its review and has provided THE BANK with its notice of non-objection.
NINETEENTH:    MR. MARTENS understands and agrees that:
		
	a.
	MR. MARTENS has until April 3, 2017 (forty-five (45) calendar days, commencing on the date MR. MARTENS received this Agreement from THE BANK), to review and to discuss the promises and covenants set forth herein with an attorney of MR. MARTEN’s own choosing regarding whether or not MR. MARTENS wishes to execute the Agreement;

		
	b.
	If MR. MARTENS does not sign and return this Agreement to THE BANK during the time period stated above, MR. MARTENS’ severance benefits described above may be reduced or eliminated as outlined in THE BANK’s Severance Policy;  

	
		
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	c.
	MR. MARTENS acknowledges that on February 17, 2017, THE BANK provided him with a list of the job titles and ages of all employees whose positions have been impacted such that their employment relationship with the Bank has or will be ending as part of the restructuring of the organizational unit impacted by this restructure (i.e. THE BANK’s senior officers), and a list of the job titles and ages of all employees in the organizational unit impacted by this restructure whose positions have not been impacted in such a manner; 

		
	d.
	MR. MARTENS is hereby encouraged to consult with an attorney of MR. MARTENS’ own choosing so that MR. MARTENS is fully aware of MR. MARTENS’ rights and obligations under this Agreement before signing it;

		
	e.
	MR. MARTENS has seven (7) calendar days after MR. MARTENS has signed this Agreement during which time MR. MARTENS may revoke this Agreement.  If MR. MARTENS wishes to revoke this Agreement, MR. MARTENS may do so by delivering a written notice of revocation to Jan Homan, Chief Human Resources Officer and OMWI, Federal Home Loan Bank of San Francisco, 600 California Street, Suite 300, San Francisco, CA 94108, within the seven-day revocation period; 

		
	f.
	Should MR. MARTENS revoke this Agreement, MR. MARTENS will not be entitled to any of the severance benefits described in Exhibit I;

		
	g.
	This Agreement shall not become effective or enforceable unless and until it is fully executed by both parties.  If fully executed, this Agreement will become effective and enforceable on the later of (i) the eighth (8th) 

	
		
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calendar day following the date MR. MARTENS executes the Agreement, or (ii) March 31, 2017 (“Effective Date”); and, 
		
	h.
	MR. MARTENS is not waiving any rights or claims under the Age Discrimination in Employment Act of 1967 (29 U.S.C. §621 et seq.) that may arise after the date this Agreement is executed.

	
		
	Dated: March 31, 2017
	/s/ David Martens

	 
	DAVID MARTENS

	 
	 

	Dated: April 11, 2017
	/s/ Janet Homan

	 
	THE FEDERAL HOME LOAN BANK OF
SAN FRANCISCO

	
		
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	EXHIBIT I

	 

	SUMMARY ESTIMATE OF SEVERANCE BENEFITS

	 
	 

	Prepared for:
	David Martens

	Title:
	SVP, Chief Risk Officer

	Hire Date:
	4/17/1996

	Separation Date Assumption:
	3/31/2017

	Bank Service:
	20 Years, 11 Months

	Annual Base Salary:
	$394,100.00

	Weekly Base Salary:
	$7,578.85

	 
	 

	*Per the Severance Policy, Mr. Martens will receive severance pay in a lump sum equal to the greater of:

	 
	 
	 

	(a) Twelve weeks of base salary:
	$90,946.15
	 

	 
	 
	 

	-OR-
	 
	 

	 
	 
	 

	(b) The sum of the following:
	 
	 

	 
	 
	 

	Three weeks of base salary:
	$22,736.54
	 

	 
	 
	 

	Three weeks of base salary for each
	 
	 

	full year of service:
	$454,730.77
	 

	 
	 
	 

	Three weeks of base salary prorated
	 
	 

	for each partial year of service:
	$20,841.83
	 

	 
	 
	 

	Total:
	$498,309.13
	 

	 
	 
	 

	Total severance to be paid:
	$394,100.00
	 

	 
	 
	 

	Subject to the following cap under the Severance Policy: The total severance pay shall not exceed 52 weeks base salary.
	 

	Severance pay is subject to federal and state tax deductions and any other withholdings required by law.

	Mr. Martens will also receive one month continuation of both life and health insurance coverage, as well as outplacement assistance for six months.
	 

	Date prepared:
	1/31/2017

	 
	 

	Prepared by:
	Eiko Bokura

	Verified by:
	Greg Fontenot

	
	
	13 of 13Exhibit 4.5

 

THIS WARRANT AND THE SHARES ISSUABLE
UPON THE EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. EXCEPT AS OTHERWISE SET
FORTH HEREIN NEITHER THIS WARRANT NOR ANY OF SUCH SHARES MAY BE SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FOR SUCH SECURITIES UNDER SAID 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 AS EVIDENCED BY A LEGAL
OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY.

 

XG SCIENCES, INC.

 

COMMON STOCK PURCHASE WARRANT

 

	Certificate No: W2016-83	Warrants to Purchase

50,000 Shares of Common Stock

December 14, 2016

 

This Common Stock Purchase Warrant (this
"Warrant") certifies that, for value received, The Dow Chemical Company or its registered assignees (the
"Holder") is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter
set forth, at any time on or after the date hereof (the "Initial Exercise Date") and on or prior to 5:00 PM Eastern
Time on December 1, 2023, (the "Expiration Date") but not thereafter, to purchase from XG Sciences, Inc., a Michigan
corporation with offices at 3101 Grand Oak Dr., Lansing, MI 48911 (the "Company"), up to 50,000 shares (the "Shares"
and each, a "Share") of the Company's common stock, no par value per share (the "Common Stock"),
at a price of $8.00 per Share, as adjusted in accordance with Section 4 below (the "Purchase Price").

 

This Warrant is issued in connection with
the Draw Loan Note and Agreement, dated as of December 7, 2016, by and among the Company, and Holder (the "Note Agreement").
Certain capitalized terms used herein that are not otherwise defined herein shall have the meanings set forth in the Note Agreement.

 

Section 1.          Exercise
of Warrants.

 

(a)          Upon
presentation and surrender at the principal executive office of the Company of this Warrant prior to the Expiration Date together
with a check to the Company in the amount of the Purchase Price multiplied by the number of Shares of Common Stock being purchased,
and compliance with the other requirements of Section 1(e) and this Warrant, the Company will issue to the Holder, Shares of Common
Stock which in the aggregate represent the number of Shares of Common Stock being purchased. This Warrant may be partially exercised
and, in the case of such partial exercise, the Company, upon surrender hereof, will deliver to the Holder a new Warrant representing
the number of Shares which have not been exercised.

 

     

     

    

 

(b)          In
lieu of exercising this Warrant, the Holder may elect to receive Shares equal to the value of this Warrant (or the portion thereof
being canceled) by surrender of this Warrant at the principal office of the Company along with the other documents required by
Section 1(e) and compliance with the requirements of this Warrant, in which event the Company shall issue to the Holder a number
of Shares computed using the following formula:

 

	 	Y (A-B)	 
	X = 	 	 
	 	A	 

 

"X"        equals the number of Shares to be
issued to the Holder.

 

"Y"        equals the number of Shares purchasable
under this Warrant.

 

"A"        equals the fair market value of one
Share on the date of determination.

 

"B"        equals the per share Purchase Price
(as adjusted to the date of such calculation).

 

(c)          Fair
Market Value. For purposes of this Section 1, the per share fair market value of the Shares means:

 

(i)          If
the Common Stock is publicly traded, the per share fair market value of the Shares shall be (a) the daily volume weighted average
price of the Common Stock for such date (or the nearest preceding date) on the trading market (including, without limitation, the
OTCQX and OTCQB markets maintained by the OTC Markets Group, Inc. and any successor-entities) which the Common Stock is then listed
or quoted as reported by Bloomberg L.P. (based on a trading day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City
time)), (b) if the OTC Bulletin Board is not a trading market, the volume weighted average price of the Common Stock for such date
(or the nearest preceding date) on the OTC Bulletin Board, (c) if the Common Stock is not then listed or quoted for trading on
the OTC Bulletin Board and if prices for the Common Stock are then reported in the "Pink Sheets" published by Pink OTC
Markets, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price
per share of the Common Stock so reported; or

 

(i)          If
the Common Stock is not so publicly traded, the per share fair market value of the Shares shall be such fair market value as is
determined in good faith by the Board of Directors of the Company after taking into consideration factors it deems appropriate,
including, without limitation, recent sale and offer prices of the capital stock of the Company in private transactions negotiated
at arm's length.

 

    	 	2	 

     

    

 

(d)          If
this Warrant shall be deemed "in the money" on the Expiration Date and the Holder has not exercised his, her or its rights
hereunder, the Company shall automatically effect a cashless exercise of this Warrant on behalf of the Holder in accordance with
the formula hereinabove, provided that the Holder must promptly thereafter comply with the other requirements of Section 1(e) and
this Warrant.

 

(e)          The
rights represented by this Warrant may be exercised by the Holder, in whole or in part (with respect to Shares of Common Stock),
subject to the conditions contained herein and at any time prior to the Expiration Date, by: (i) surrender of this Warrant for
cancellation at the principal executive office of the Company (or at such other office or agency of the Company as it may designate
by notice in writing to the Holder at the address of the Holder appearing on the books of the Company); (ii) payment to the Company
of the Purchase Price for the number of Shares of Common Stock specified in the Notice of Exercise form; (iii) delivery to the
Company of a duly executed agreement signed by the person(s) designated in the Notice of Exercise form to the effect that such
person(s) agree(s) to be bound by all of the terms and conditions of this Warrant; (iv) delivery to the Company of a duly executed
Notice of Exercise form attached hereto as Exhibit A and Investment Representation Statement form attached hereto as Exhibit
D to the extent such Investment Representation Statement remains applicable; and (v) delivery to the Company of duly executed
adoption agreements for the Shareholder Agreement and the Voting Agreement (each as defined in Section 2(b)) as and to the extent
required by Section 8(g). This Warrant shall be deemed to have been exercised, in whole or in part to the extent specified, immediately
prior to the close of business on the date on which all of the applicable provisions of this Section 1(e) are reasonably satisfied,
and the person(s) designated in the Notice of Exercise form shall become the holder(s) of record of the Shares of Common Stock
issuable upon such exercise at that time and date.

 

(f)          As
soon as possible after any full or partial exercise of this Warrant, but in any event no more than ten (10) business days, the
Company, at its expense, will instruct its transfer agent to issue as soon as possible in the name of and delivered to the Holder
of this Warrant, the number of fully paid and non-assessable Shares of Common Stock to which that Holder shall be entitled on such
exercise. No fractional shares will be issued on exercise of this Warrant. If, on any exercise of this Warrant, a fractional share
results, the Company will pay the cash value of that fractional share, calculated on the basis of the Purchase Price. The Company
may issue certificates for Shares or, if consistent with the Company’s generally applicable practice, may issue uncertificated
Shares as permitted under the Michigan Business Corporation Act. Any certificates evidencing the Shares shall bear restrictive
legends to the extent required by this Warrant.

 

Section 2.          Legends.

 

(a)          Until the date
on which a registration statement filed by the Company under the Securities Act of 1933, as amended (the "Securities Act")
covering the issuance and sale or the resale of the Shares is declared effective by the U.S. Securities and Exchange Commission
(the "SEC"), any certificates evidencing the Shares shall bear a legend substantially in the following form:

 

    	 	3	 

     

    

 

"THESE SECURITIES HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR REGISTERED OR QUALIFIED UNDER APPLICABLE STATE SECURITIES LAWS
AND MAY NOT BE OFFERED FOR RESALE OR RESOLD UNLESS REGISTERED PURSUANT TO THE PROVISIONS OF THE SECURITIES ACT AND REGISTERED OR
QUALIFIED PURSUANT TO THE PROVISIONS OF APPLICABLE STATE SECURITIES LAWS, UNLESS AN EXEMPTION FROM SUCH REGISTRATION OR QUALIFICATION
IS AVAILABLE."

 

(b)          Any
certificates evidencing the Shares shall bear legends to the extent required by the Company’s shareholder agreement dated
March 18, 2013 and amended effective as of April 13, 2016 (the “Shareholder Agreement”) and the Company’s
voting agreement dated January 15, 2014 (the “Voting Agreement”).

 

(c)          Any
certificates evidencing the Shares shall bear legends substantially in the following form to the extent reasonably required by
the Company:

 

“THE SHARES OF STOCK REPRESENTED
BY THIS CERTIFICATE ARE SUBJECT TO AGREEMENTS SET FORTH IN THE BYLAWS OF THE CORPORATION AMONG THE SHAREHOLDERS OF THE CORPORATION
PURSUANT TO SECTION 488 OF THE MICHIGAN BUSINESS CORPORATION ACT. A COPY OF THE BYLAWS IS ON FILE WITH THE SECRETARY OF THE CORPORATION.
BY ACCEPTANCE OF THIS CERTIFICATE, THE HOLDER HEREOF AGREES TO BE BOUND BY THE TERMS OF SAID AGREEMENTS.”

 

(d)          The
Holder consents to the Company making a notation on its records and giving instructions to any transfer agent in order to implement
the restrictions on transfer established in this Warrant (including in the foregoing contemplated legends), the Shareholder Agreement
or the Voting Agreement. The Company will not be required to (i) transfer on its books any securities that have been transferred
in violation of any provisions of this Warrant, the Shareholder Agreement, the Voting Agreement or applicable law, or (ii) to treat
as owner of such securities, or accord the right to vote or pay dividends to any purchaser, donee or other transferee to whom such
securities may have been so transferred.

 

Section 3.          Charges,
Taxes and Expenses. Issuance of Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental
expense in respect of the issuance of such Shares, all of which expenses shall be paid by the Company, and such Shares shall be
issued in the name of the Holder or in such name or names as may be directed by the Holder; provided, however, that in the event
certificates for Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for exercise
shall be accompanied by the Assignment Form attached hereto duly executed by the Holder, the assignee, and the Company may require,
as a condition thereto, the payment of a sum sufficient to reimburse it for any expenses incidental thereto.

 

    	 	4	 

     

    

 

Section 4.          Certain
Adjustments.

 

(a)          Stock
Dividends and Stock Splits. If the Company, at any time after the date hereof: (A) shall pay a stock dividend or otherwise
make a distribution or distributions on shares of its Common Stock in shares of Common Stock, (B) subdivide outstanding shares
of Common Stock into a larger number of shares, or (C) combine (including by way of reverse stock split) outstanding shares of
Common Stock into a smaller number of shares, then the Purchase Price shall be multiplied by a fraction of which the numerator
shall be the number of shares of Common Stock outstanding before such event and of which the denominator shall be the number of
shares of Common Stock outstanding after such event. Any adjustment made pursuant to this Section shall become effective immediately
after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become
effective immediately after the effective date in the case of a subdivision, combination or re-classification, and the number of
Shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Purchase Price of this
Warrant shall remain unchanged.

 

(b)          Fundamental
Transaction. If, at any time while this Warrant is outstanding, (A) the Company effects any merger or consolidation of the
Company with or into another person, (B) the Company effects any sale of all or substantially all of its assets in one or a series
of related transactions, (C) any tender offer or exchange offer (whether by the Company or another person) is completed pursuant
to which holders of Common Stock are permitted to tender or exchange their shares for other securities, cash or property, or (D)
the Company effects any reclassification of the Common Stock or any compulsory share exchange pursuant to which the Common Stock
is effectively converted into or exchanged for other securities, cash or property (in any such case, a "Fundamental Transaction"),
then upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Share of Common Stock
that would have been issuable upon such conversion absent such Fundamental Transaction, the same kind and amount of securities,
cash or property as it would have been entitled to receive upon the occurrence of such Fundamental Transaction if it had been,
immediately prior to such Fundamental Transaction, the holder of one share of Common Stock (the "Alternate Consideration").
For purposes of any such conversion, the determination of the Purchase Price shall be appropriately adjusted to apply to such
Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such
Fundamental Transaction, and the Company shall apportion the Purchase Price among the Alternate Consideration in a reasonable
manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Common Stock are
given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be
given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such Fundamental
Transaction. To the extent necessary to effectuate the foregoing provisions, any successor to the Company or surviving entity
in such Fundamental Transaction shall issue to the Holder a new warrant consistent with the foregoing provisions and evidencing
the Holder's right to exercise such warrant for the Alternate Consideration. The terms of any agreement pursuant to which a Fundamental
Transaction is effected shall include terms requiring any such successor or surviving entity to comply with the provisions of
this paragraph (b) and insuring that this Warrant (or any such replacement security) will be similarly adjusted upon any subsequent
transaction analogous to a Fundamental Transaction.

 

    	 	5	 

     

    

 

Section 5.          Transfer
of Warrant. Subject to the requirements of this Warrant, compliance with the Securities Act and other federal and state law,
and the Company’s Articles of Incorporation and Bylaws, all rights hereunder are transferable, in whole or in part, upon
surrender of this Warrant at the principal executive office of the Company or its designated agent, together with a written assignment
of this Warrant substantially in the form attached hereto as Exhibit B and the Investment Representation Statement attached
hereto as Exhibit D to the extent such Investment Representation Statement remains applicable, duly executed by the Holder
or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender
and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or
assignees, as applicable, and in the denomination or denominations specified in such instrument of assignment, and shall issue
to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled.
The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares
without having a new Warrant issued.

 

Section 6.          Representations
and Warranties.

 

(a)          Common
Stock. The Company hereby represents and warrants to the Holder that all Shares that may be issued upon the exercise of the
purchase rights represented by this Warrant, and all securities, shall, upon issuance, be duly authorized, validly issued, fully
paid and nonassessable, and free of any liens and encumbrances. The Company hereby agrees that it shall at all times reserve and
keep available out of its authorized but unissued Common Stock, solely for the purpose of effecting the exercise of this Warrant,
a number of shares of Common Stock equal to the number of shares as shall from time to time be sufficient to effect the exercise
of this entire Warrant at the Purchase Price.

 

(b)          Notice
of Certain Events. If the Company proposes at any time (i) to declare any dividend or distribution upon its Common Stock, whether
in cash, property, stock, or other securities and whether or not a regular cash dividend; (ii) to offer for subscription pro rata
to the holders of any class or series of its stock any additional shares of stock of any class or series or other rights; (iii)
to effect any reclassification or recapitalization of Common Stock; (iv) to merge or consolidate with or into any other corporation,
or sell, lease, license, or convey all or substantially all of its assets, or to liquidate, dissolve or wind up, or to effect an
acquisition; or (v) to offer holders of registration rights the opportunity to participate in an underwritten public offering of
the company’s securities for cash, then, in connection with each such event, the Company shall give Holder (1) at least 20
days prior written notice of the date on which a record will be taken for such dividend, distribution, or subscription rights (and
specifying the date on which the holders of Common Stock will be entitled thereto) or for determining rights to vote, if any, in
respect of the matters referred to in (i) and (ii) above; (2) in the case of the matters referred to in (iii) and (iv) above at
least 20 days prior written notice of the date when the same will take place (and specifying the date on which the holders of Common
Stock will be entitled to exchange their Common Stock for securities or other property deliverable upon the occurrence of such
event); and (3) in the case of the matter referred to in (v) above, the same notice as is given to the holders of such registration
rights.

 

    	 	6	 

     

    

 

(c)          Investment
Representation Statement. The Holder hereby makes to the Company each of the representations and warranties in the Investment
Representation Statement form attached hereto as Exhibit D.

 

Section 7.          Indemnification.
Without limitation of any other provision of this Warrant or any other agreement between the Holder and the Company, the Company
agrees to defend, indemnify and hold Holder, its respective affiliates and direct and indirect partners (including partners of
partners and stockholders and members of partners), members, stockholders, directors, officers, employees and agents and each
person who controls any of them within the meaning of Section 15 of the Securities Act, or Section 20 of the Securities Exchange
Act of 1934, as amended (the "Exchange Act") (collectively, the "Holder Indemnified Parties"
and, individually, a "Holder Indemnified Party") harmless from and against any and all damages, liabilities,
losses, taxes, fines, penalties, reasonable costs and expenses (including, without limitation, reasonable fees of a single counsel
representing the Holder Indemnified Parties), as the same are incurred, of any kind or nature whatsoever (whether or not arising
out of third-party claims and including all amounts paid in investigation, defense or settlement of the foregoing) which may be
sustained or suffered by any such Holder Indemnified Party ("Losses"), based upon, arising out of, or by reason
of (a) any breach of any representation or warranty made by the Company in this Warrant, the Note Agreement, or any other agreement
executed in connection herewith, (b) any breach of any covenant or agreement made by the Company in this Warrant, the Note Agreement,
or any other agreement executed in connection herewith, or (c) any third party or governmental claims relating in any way to such
Holder Indemnified Party’s status as a security holder, creditor, director, agent, representative or controlling person
of the Company or otherwise relating to such Holder Indemnified Party’s involvement with the Company (including, without
limitation, any and all Losses under the Securities Act, the Exchange Act or other federal or state statutory law or regulation,
at common law or otherwise, which relate directly or indirectly to the registration, purchase, sale or ownership of any securities
of the Company or to any fiduciary obligation owed with respect thereto), including, without limitation, in connection with any
third party or governmental action or claim relating to any action taken or omitted to be taken or alleged to have been taken
or omitted to have been taken by any Holder Indemnified Party as security holder, director, agent, representative or controlling
person of the Company or otherwise, alleging so-called control person liability or securities law liability. The term "Losses"
shall specifically exclude loss of profits and all punitive, incidental, consequential, special or indirect damages, except
to the extent paid to a third party, and shall include diminution of value. The rights of the parties hereunder shall be in addition
to, and not in lieu of, any other rights and remedies which may be available to it by law; provided, however, that
the Company will not be liable to the extent that such Losses arise from and are based on conduct by a Holder Indemnified Party
that constitutes fraud, gross negligence or willful misconduct.

 

    	 	7	 

     

    

 

Section 8.          Miscellaneous.

 

(a)          No
Rights as Stockholder Until Exercise. This Warrant does not entitle the Holder to any voting rights, dividends or other rights
as a stockholder of the Company prior to the exercise hereof.

 

(b)          Loss,
Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Shares,
and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant,
shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated,
the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of
such Warrant or stock certificate.

 

(c)          Saturdays,
Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or
granted herein shall not be a business day (because it is a Saturday, Sunday or U.S. federal holiday), then such action may be
taken or such right may be exercised on the next succeeding business day.

 

(d)          Authorized
Shares. The Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued
Common Stock a sufficient number of shares of Common Stock to provide for the issuance of the Shares upon the exercise of any purchase
rights under this Warrant. The Company further covenants that its issuance of this Warrant shall constitute full authority to its
officers who are charged with the duty of executing stock certificates to execute and issue the necessary certificates for the
Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such reasonable action as may be
necessary to assure that such Shares may be issued as provided herein without violation of any applicable law or regulation, or
of any requirements of any trading market upon which the Common Stock may be listed. The Company covenants that all Shares which
may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise of the purchase rights represented
by this Warrant and payment for such Shares in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable
and free from all taxes, liens and charges created by the Company in respect of the issue thereof (other than taxes in respect
of any transfer occurring contemporaneously with such issue).

 

(e)          Warrant
Shares Report. In each case of any adjustment or readjustment in the Warrant Shares issuable upon the exercise of this Warrant,
the Company at its sole expense will upon request promptly compute such adjustment or readjustment in accordance with the terms
of this Warrant and, upon request in connection with the preparation of the Company’s quarterly financial statements, prepare
a report setting forth such adjustment or readjustment and showing in reasonable detail the method of calculation thereof and the
facts upon which such adjustment or readjustment is based, including a statement of (i) the consideration received or to be received
by the Company for any additional shares issued or sold or deemed to have been issued, (ii) the number of shares of Common Stock
outstanding or deemed to be outstanding, and (iii) the Purchase Price in effect immediately prior to such issue or sale and as
adjusted and readjusted on account thereof. The Company will forthwith mail a copy of each such report to Holder and will, upon
the written request at any time of Holder, furnish to Holder a like report setting forth the Purchase Price at the time in effect
and showing in reasonable detail how it was calculated. The Company will also keep copies of all such reports at its principal
executive office and will cause the same to be available for inspection at such office during normal business hours by Holder or
any prospective purchaser or assignee of this Warrant designated by the Holder.

 

    	 	8	 

     

    

 

(f)          Jurisdiction.
All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined in accordance
with the laws of the State of Michigan.

 

(g)          Restrictions.
The Holder acknowledges that the Shares acquired upon the exercise of this Warrant, if not registered, will have restrictions upon
resale and other matters imposed by state and federal securities laws, this Warrant, the Shareholder Agreement, and the Voting
Agreement to the extent applicable upon and following exercise of this Warrant. The Holder agrees, as a condition to exercise of
this Warrant, to become a party to and to be bound by the Shareholder Agreement and the Voting Agreement, and any subsequent amendments
to either, to the extent applicable upon and following the exercise of this Warrant. The parties acknowledge that the Shareholder
Agreement and Voting Agreement may contain provisions that terminate such documents upon the closing of a public offering of Common
Stock, among other provisions. To the extent that any such agreement is terminated or no longer applicable, the Holder shall not
be required to become a party to it or be bound by it.

 

(h)          Nonwaiver.
No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of
such right or otherwise prejudice the Holder's rights, powers or remedies.

 

(i)           Notices.
Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered
to the Holder at the address provided herein by Holder in Exhibit C, attached hereto. if the Holder has not provided contact
information in Exhibit C, the Company shall be entitled to use the contact information of the Holder in the Company's books
and records.

 

(j)           Limitation
of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase
Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder for
the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company or
by creditors of the Company.

 

(k)          Remedies.
The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled
to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation
for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert
the defense in any action for specific performance that a remedy at law would be adequate.

 

    	 	9	 

     

    

 

(l)           Successors
and Assigns. Subject to the terms of this Warrant and applicable securities laws, this Warrant and the rights and obligations
evidenced hereby shall inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the
successors and permitted assigns of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from
time to time of this Warrant and shall be enforceable by the Holder or holder of Shares.

 

(m)         Amendment.
This Warrant may only be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.

 

(n)          Severability.
Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective
to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions
of this Warrant.

 

(o)          Headings.
The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of
this Warrant.

 

(Signature Page Follows)

 

    	 	10	 

     

    

 

IN WITNESS WHEREOF, the Company
has caused this Warrant to be signed by its duly authorized officer and this Warrant to be dated as of the date first above written.

 

	 	XG SCIENCES, INC.
	 	 	 
	 	By:	/s/ Philip L. Rose
	 	 	Philip L. Rose, Chief Executive Officer

 

    	 	11	 

     

    

 

EXHIBIT A

 

NOTICE OF EXERCISE

 

TO: XG SCIENCES, INC.

 

(1)         The
undersigned hereby elects to purchase _______ Shares of the Company pursuant to the terms of the attached Warrant, and
tenders herewith payment of the exercise price in full, together with the other items required by the Warrant.

 

(2)         Payment
shall take the form of (check applicable box):

 

 ̈
wire transfer in lawful money of the United States; 

 ̈
cashier's check drawn on a U.S. bank; or

 ̈
in accordance with the formula set forth in Section 1(b), to exercise this Warrant with respect to the number of shares of Common
Stock purchasable pursuant to the cashless exercise procedure set forth in Section 1(b).

 

The undersigned requests that the shares of such Common Stock
be issued in the name(s) of, and delivered to, the person(s) whose name(s) and address(es) are set forth below:

 

	 
	(Please type or print name and address)
	 
	 
	(Social Security or tax identification number)

 

	and delivered to:	 	 
	 	(Please type or print name and address)	 

 

and, if such number of shares of Common
Stock shall not be all the Common Stock evidenced by this Warrant, that a new Warrant of like tenor for the balance of the shares
of Common Stock subject to the Warrant be registered in the name of, and delivered to, the Holder at the address stated below.

 

The undersigned has executed, and delivers
herewith, an Investment Representation Statement in a form substantially similar to the form attached to the Warrant as Exhibit
D.

 

[Signature page follows]

 

    	 	12	 

     

    

 

[SIGNATURE OF HOLDER]

 

	Name of Investing Entity:	 

 

	Signature of Authorized Signatory of Investing Entity:	 

 

	Name of Authorized Signatory:	 

 

	Title of Authorized Signatory:	 

 

	Date:	 

 

[Signature page to Notice of Exercise]

 

    	 	13	 

     

    

 

EXHIBIT B WARRANT 

 

ASSIGNMENT

 

FOR VALUE RECEIVED, the undersigned holder
of the warrant (the “Assignor”) does hereby assign and transfer to ____________, Federal Identification No. ____________
(the “Assignee”), a warrant to purchase ____________ shares of the capital stock of XG Sciences, Inc. represented by
warrant certificate no. ____________ (the “Warrant”), standing in the name of the undersigned on the books of said
corporation. The Assignor does hereby irrevocably constitute and appoint ____________, attorney to transfer the warrants of said
corporation, with full power of substitution in the premises.

 

The Assignee agrees to take and hold the
Warrant and any shares of capital stock of XG Sciences, Inc. to be issued upon exercise of the rights thereunder subject to, and
to be bound by, the terms and conditions set forth in the Warrant (including the shareholder agreement and voting agreement referenced
therein) to the same extent as if Assignee were the original holder thereof.

 

Assignee has executed, and delivers herewith,
an Investment Representation Statement in a form substantially similar to the form attached to the Warrant as Exhibit D.

 

ASSIGNOR:

 

	Dated:	 	 	[Assignor]
	 	 	 	 	 
	 	 	By: 	 
	 	 	Name: 	 
	 	 	Title:	 

 

	ASSIGNEE:	 	 
	 	 	 	 
	Dated:	 	 	[Assignee]
	 	 	 	 	 
	 	 	By:	 
	 	 	Name:	 
	 	 	Title:	 

 

    	 	14	 

     

    

 

EXHIBIT C

 

WARRANT HOLDER'S CONTACT INFORMATION

 

		Name:	The Dow Chemical Company

 

		Address:	2030 Dow Center

Midland, Michigan 48674

Attention:          Corporate
Venture Capital

 

Telephone Number:      (989) 636-0571

 

		Email:	________________________________________

 

    	 	15	 

     

    

 

EXHIBIT D

 

INVESTMENT REPRESENTATION STATEMENT

 

		INVESTOR:	_____________________________

 

		COMPANY:	XG Sciences, Inc., a Michigan corporation

 

		SECURITIES:	THE WARRANT ISSUED ON __________ (THE “WARRANT”)
AND THE SECURITIES ISSUED OR ISSUABLE UPON EXERCISE THEREOF

 

		DATE:	_____________________________

 

In connection with
the purchase or acquisition of the above-listed Securities, the undersigned Investor represents and warrants to, and agrees with,
the Company as follows:

 

1.          No
Registration. The Investor understands that the Securities have not been, and will not be, registered under the Securities
Act of 1933, as amended (the “Securities Act”), by reason of a specific exemption from the registration
provisions of the Securities Act, the availability of which depends upon, among other things, the bona fide nature of the
investment intent and the accuracy of the Investor’s representations as expressed herein or otherwise made pursuant hereto.

 

2.          Investment
Intent. The Investor is acquiring the Securities for investment for its own account, not as a nominee or agent, and not with
a view to, or for resale in connection with, any distribution thereof. The Investor has no present intention of selling, granting
any participation in, or otherwise distributing the Securities, nor does it have any contract, undertaking, agreement or arrangement
for the same.

 

3.          Investment
Experience. The Investor has substantial experience in evaluating and investing in private placement transactions of securities
in companies similar to the Company, and has such knowledge and experience in financial or business matters so that it is capable
of evaluating the merits and risks of its investment in the Company and protecting its own interests.

 

4.          Speculative
Nature of Investment. The Investor understands and acknowledges that its investment in the Company is highly speculative and
involves substantial risks. The Investor can bear the economic risk of its investment and is able, without impairing its financial
condition, to hold the Securities for an indefinite period of time and to suffer a complete loss of its investment.

 

5.          Access
to Data. The Investor has had an opportunity to ask questions of officers of the Company, which questions were answered to
its satisfaction. The Investor understands that any such discussions, as well as any information issued by the Company, were intended
to describe certain aspects of the Company’s business and prospects, but were not necessarily a thorough or exhaustive description.
The Investor acknowledges that any business plans prepared by the Company have been, and continue to be, subject to change and
that any projections included in such business plans or otherwise are necessarily speculative in nature, and it can be expected
that some or all of the assumptions underlying the projections will not materialize or will vary significantly from actual results.

 

    	 	16	 

     

    

 

6.          Accredited
Investor. The Investor is an “accredited investor” within the meaning of Regulation D, Rule 501(a), promulgated
by the Securities and Exchange Commission and agrees to submit to the Company such further assurances of such status as may be
reasonably requested by the Company.

 

7.          Residency.
The residency of the Investor (or, in the case of a partnership or corporation, such entity’s principal place of business)
is correctly set forth on the signature page hereto.

 

8.          Restrictions
on Resales. The Investor acknowledges that the Securities must be held indefinitely unless subsequently registered under the
Securities Act or an exemption from such registration is available. The Investor is aware of the provisions of Rule 144 promulgated
under the Securities Act, which permit resale of shares purchased in a private placement subject to the satisfaction of certain
conditions, which may include, among other things, the availability of certain current public information about the Company; the
resale occurring not less than a specified period after a party has purchased and paid for the security to be sold; the number
of shares being sold during any three-month period not exceeding specified limitations; the sale being effected through a “broker’s
transaction,” a transaction directly with a “market maker” or a “riskless principal transaction”
(as those terms are defined in the Securities Act or the Exchange Act (as defined below), as amended, and the rules and regulations
promulgated thereunder); and the filing of a Form 144 notice, if applicable. The Investor acknowledges and understands that the
Company may not be satisfying the current public information requirement of Rule 144 at the time the Investor wishes to sell the
Securities and that, in such event, the Investor may be precluded from selling the Securities under Rule 144 even if the other
applicable requirements of Rule 144 have been satisfied. The Investor understands and acknowledges that, in the event the applicable
requirements of Rule 144 are not met, registration under the Securities Act or an exemption from registration will be required
for any disposition of the Securities. The Investor understands that, although Rule 144 is not exclusive, the Securities and Exchange
Commission has expressed its opinion that persons proposing to sell restricted securities received in a private offering other
than in a registered offering or pursuant to Rule 144 will have a substantial burden of proof in establishing that an exemption
from registration is available for those offers or sales and that those persons and the brokers who participate in the transactions
do so at their own risk. The Investor acknowledges that the Securities will have restrictions upon resale and other matters imposed
by the Company’s shareholder agreement and voting agreement, to the extent applicable. The Investor agrees to become a party
to and to be bound by the Shareholder Agreement and the Voting Agreement, and any subsequent amendments to either, to the extent
applicable.

 

9.          No
Public Market. The Investor understands and acknowledges that no public market now exists for any of the securities issued
by the Company and that the Company has made no assurances that a public market will ever exist for the Company’s securities.

 

    	 	17	 

     

    

 

10.         Brokers
and Finders. The Investor has not engaged any brokers, finders or agents in connection with the Securities, and the Company
has not incurred nor will incur, directly or indirectly, as a result of any action taken by the Investor, any liability for brokerage
or finders’ fees or agents’ commissions or any similar charges in connection with the Securities.

 

11.         Legal
Counsel. The Investor has had the opportunity to review the Warrant, the exhibits and schedules attached thereto and the transactions
contemplated by the Warrant with its own legal counsel. The Investor is not relying on any statements or representations of the
Company or its agents for legal advice with respect to this investment or the transactions contemplated by the Warrant.

 

12.         Tax
Advisors. The Investor has reviewed with its own tax advisors the U.S. federal, state and local and non-U.S. tax consequences
of this investment and the transactions contemplated by the Warrant. With respect to such matters, the Investor relies solely on
such advisors and not on any statements or representations of the Company or any of its agents, written or oral. The Investor understands
that it (and not the Company) shall be responsible for its own tax liability that may arise as a result of this investment or the
transactions contemplated by the Warrant.

 

The Investor is signing this Investment Representation Statement
on the date first written above.

 

	 	INVESTOR
	 	 
	 	[____________________]
	 	 
	 	 
	 	(Print name of the investor)
	 	 
	 	 
	 	(Signature)
	 	 
	 	 
	 	(Name and title of signatory, if 

applicable)
	 	 
	 	 
	 	(Street address)
	 	 
	 	 
	 	(City, state and 

ZIP)

 

    	 	18

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