EXHIBIT 10.2C
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PACIFIC BIOMETRICS, INC.
-- RESTRICTED STOCK PURCHASE AGREEMENT --
No. __________
This Restricted Stock Purchase Agreement ("Agreement") is made and
entered into as of the date of award set forth below ("Date of Award") by and
between Pacific Biometrics, Inc., a Delaware corporation ("Company"), and the
participant named below ("Participant"). Capitalized terms not defined herein
shall have the respective meanings ascribed to them in the Company's 2005 Stock
Incentive Plan ("Plan"). A copy of the Plan has been provided to Participant.
Participant's Name:
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Participant's Address:
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Total Number of Shares:
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Purchase Price per Share:
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Date of Award:
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Vesting Commencement Date:
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1. Purchase and Sale of the Shares. Subject to the terms and
conditions of this Agreement, the Company agrees to sell to Participant and
Participant agrees to purchase from the Company at the Closing (as defined
below) the total number of shares of Common Stock of the Company set forth above
("Shares") at the purchase price per share set forth above ("Purchase Price").
All references to the number of Shares and the Purchase Price of the Shares in
this Agreement shall be adjusted to reflect any stock split, stock dividend or
other similar change in the Shares which may be made after the date of this
Agreement.
2. Closing.
(a) The purchase and sale of the Shares shall occur at a
closing (the "Closing") to be held on the date first set forth above, or at any
other time mutually agreed upon by the Company and Participant. The Closing will
take place at the principal office of the Company or at such other place as
shall be designated by the Company. At the Closing, Participant shall deliver
the aggregate Purchase Price set forth above to the Company by cash or personal
or cashiers' check payable to the Company, and the Company will issue, as
promptly thereafter as practicable, a stock certificate, registered in the name
of the Participant, reflecting the Shares. Notwithstanding the foregoing,
Participant may not purchase any Shares under this Award unless such sale and
issuance complies with all relevant provisions of applicable laws and
regulations and the requirements of any stock exchange upon which the Company
common stock is then listed.
(b) In addition, at Closing Participant shall execute and
deliver to the Company (i) two copies of the Assignment Separate From
Certificate (with the date and the number of Shares left blank) substantially in
the form attached to this Agreement as Exhibit A and (ii) one copy of the Joint
Escrow Instructions substantially in the form attached to this Agreement as
Exhibit B.
3. Repurchase Option of Unvested Shares.
(a) In the event the Participant ceases to be an employee,
consultant or director of the Company (each, a "Service Provider") for any or no
reason, including without limitation, by reason of Participant's death,
Disability, resignation or involuntary termination, with or without Cause, the
Company shall upon the date of such termination (as reasonably fixed and
determined by the Company) have the right, but not the obligation (the
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"Repurchase Option"), for a period of 90 days from such date (or such longer
period as may be agreed to by Participant and the Company), to repurchase any
Shares which have not yet vested as of the termination date (the "Unvested
Shares").
(b) The Company may exercise its Repurchase Option and
repurchase all or any of the Unvested Shares at a price per share equal to the
lesser of (x) the fair market value of the shares at the time the Repurchase
Option is exercised, as determined by the Company's board of directors and (y)
the Purchase Price (the "Repurchase Price"). The Repurchase Option shall be
exercised by the Company by delivering written notice to the Participant or, in
the event of the Participant's death or disability, Participant's executor,
which shall identify the number of Unvested Shares to be repurchased and shall
notify Participant of the time, place and date for settlement of such purchase,
which shall be scheduled by the Company within the term of the Repurchase
Option. The Company shall be entitled to pay for any Unvested Shares repurchased
pursuant to its Repurchase Option at the Company's option by check or by offset
against any indebtedness owing to the Company by Participant, or by a
combination of both. Upon delivery of such notice and the payment of the
aggregate Repurchase Price, the Company shall become the legal and beneficial
owner of the Unvested Shares being repurchased and all rights and interests
therein or relating thereto and the Company shall have the right to retain and
transfer to its own name the number of Unvested Shares being repurchased by the
Company.
(b) The Company in its sole discretion may designate and
assign one or more employees, officers, directors, stockholders, affiliates,
successors or assigns of the Company or other persons or organizations to
exercise all or a part of the Company's Repurchase Option to purchase all or a
part of the Unvested Shares.
4. Vesting; Release of Shares From Repurchase Option. So long as
Participant's continuous status as a Service Provider has not yet terminated in
each such instance, the Shares will vest and be released from the Repurchase
Option in equal monthly installments over a period of 36 months from the Vesting
Commencement Date.
5. Acceleration of Vesting upon Change of Control. In the event
of a Change of Control (as defined in the Plan), unless otherwise determined by
the Board or Committee at the time of grant or by amendment (with the
Participant's consent) all outstanding Unvested Shares shall become fully vested
and released from the Repurchase Option.
6. Investment Representations. In connection with the purchase of
the Common Stock, Participant represents to the Company the following:
(a) Participant is aware of the Company's business affairs and
financial condition and has acquired sufficient information about the Company to
reach an informed and knowledgeable decision to acquire the Shares. Participant
is acquiring the Shares for investment for his / her own account only and not
with a view to, or for resale in connection with, any "distribution" thereof
within the meaning of the Securities Act.
(b) Participant can properly evaluate the merits and risks of
an investment in the Shares and can protect his / her own interests in this
regard, whether by reason of his / her own business and financial expertise, the
business and financial expertise of his / her professional advisors, or his /
her preexisting business or personal relationship with the Company or any of its
officers, doctors or controlling persons. Participant realizes that the purchase
of the Shares involves a high degree of risk, and that the Company's future
prospects are uncertain. Participant is able to hold the Shares indefinitely if
required, and is able to hear the loss of his / her entire investment in the
Shares.
(c) Participant acknowledges that unless and until the Company
files a registration statement under the Securities Act with respect to the
Shares, the Shares are "restricted securities" and the Shares may not be resold
unless such proposed resale is registered or pursuant to an available exemption
under the Securities Act. The Company is under no obligation to register the
Shares or any subsequent proposed resale of the shares. The certificate
evidencing the Shares will be imprinted with a legend which prohibits the
transfer of the Shares unless such transfer is registered or such registration
is not required in the opinion of counsel for the Company.
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7. Restrictions on Transfer.
(a) Restrictive Legends. Participant understands and agrees
that the Company shall cause the legends set forth below, or substantially
equivalent legends, to be placed upon any certificate(s) evidencing ownership of
the Shares, together with any other legends that may be required by the Company
or by applicable state or federal securities laws:
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A REPURCHASE
OPTION HELD BY THE ISSUER OR ITS ASSIGNEE(S) AS SET FORTH IN THE
RESTRICTED STOCK PURCHASE AGREEMENT BETWEEN THE ISSUER AND THE ORIGINAL
HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE
PRINCIPAL OFFICE OF THE ISSUER. ANY TRANSFER OR ATTEMPTED TRANSFER OF
ANY SHARES SUBJECT TO SUCH OPTION IS VOID WITHOUT THE PRIOR EXPRESS
WRITTEN CONSENT OF THE COMPANY."
(b) Stop-Transfer Notices. Participant agrees that to ensure
compliance with the restrictions referred to herein, the Company may issue
appropriate "stop transfer" instructions to its transfer agent.
(c) Refusal to Transfer. The Company shall not be required (i)
to transfer on its books any Shares that have been sold or otherwise transferred
in violation of any of the provisions of this Agreement or (ii) to treat as
owner of such Shares or to accord the right to vote or pay dividends to
Participant or other transferee to whom such Shares shall have been so
transferred.
(d) Unvested Shares. Notwithstanding anything to the contrary
in this Agreement, neither any Unvested Shares nor any beneficial interest in
such Unvested Shares shall be sold, gifted, transferred, encumbered or otherwise
disposed of in any way (whether by operation of law or otherwise) by the
Participant.
8. Escrow. As security for the faithful performance of this
Agreement, Participant agrees to deliver, immediately upon receipt of the
certificate(s) evidencing the Shares, and authorizes and directs the Company to
cause the stock certificates evidencing the Shares to be delivered, to the
Secretary of the Company or its designee (the "Escrow Agent"). These documents
shall be held by the Escrow Agent pursuant to the Joint Escrow Instructions of
the Company and Participant set forth in Exhibit B to this Agreement, which
instructions are incorporated into this Agreement by this reference, and which
instructions shall also be delivered to the Escrow Agent after the Closing Date.
9. Rights as Stockholder. Subject to the provisions of this
Agreement, Participant shall exercise all rights and privileges of a stockholder
of the Company with respect to the Shares from and after the date that
Participant delivers a fully executed copy of this Agreement (including all
exhibits and attachments hereto) and full payment for the Shares to the Company,
including the right to vote the Shares, even if some or all of the Shares have
not yet vested and been released from the Company's Repurchase Option. From the
date of the Company's exercise of its Repurchase Option, Participant shall have
no further rights as a holder of the Unvested Shares repurchased by the Company,
other than the right to receive payment for the Unvested Shares so repurchased
in accordance with the provisions of this Agreement.
10. Tax Consequences. Participant has reviewed with his / her own
tax advisors the federal, state, local and foreign tax consequences of this
investment and the transactions contemplated by this Agreement. Participant is
relying solely on such advisors and not on any statements or representations of
the Company or any of its agents. Participant understands that Participant (and
not the Company) shall be responsible for any tax liability that may arise as a
result of the transactions contemplated by this Agreement. Participant
understands that Code Section 83 taxes as ordinary income the difference between
the Purchase Price for the Shares and the fair market value of the Shares as of
the date any restrictions on the Shares lapse. In this context, "restriction"
includes the right of the Company to repurchase the Shares pursuant to the
Repurchase Option. Participant understands that Participant may elect to be
taxed at the time the Shares are purchased, rather than when and as the Shares
vest, by filing with the IRS an election under Code Section 83(b) within 30 days
from the date of purchase. THE FORM FOR MAKING THIS SECTION 83(b) ELECTION IS
ATTACHED TO THIS AGREEMENT AS EXHIBIT C AND PARTICIPANT (AND NOT THE COMPANY OR
ANY OF ITS AGENTS) SHALL BE SOLELY
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RESPONSIBLE FOR APPROPRIATELY FILING SUCH FORM, EVEN IF PARTICIPANT REQUESTS THE
COMPANY OR ITS AGENTS TO MAKE THIS FILING ON PARTICIPANT'S BEHALF.
11. Payment of Withholdings Taxes. Purchaser acknowledges that
he / she is responsible for paying or providing for any applicable federal or
state tax withholdings as a result of this Award. Accordingly, at the time this
Award is granted, or at any time thereafter as requested by the Company,
Participant hereby authorizes withholding from payroll and any other amounts
payable to Participant, and Participant otherwise agrees to make adequate
provision for, any sums required to satisfy the federal, state, local and
foreign tax withholding obligations of the Company, which arise in connection
with this Award. Unless the tax withholding obligations of the Company are
satisfied, the Company shall have no obligation to issue a certificate for such
Shares or release such Shares from any escrow provided for herein.
12. Employment at Will; No Employment or Service Contract.
Participant acknowledges and agrees that the vesting of Shares pursuant to this
Agreement is earned only by continuing service as an employee, director or
consultant of the Company. Neither this Award nor anything in this Agreement
(including the vesting schedule) constitutes an express or implied promise of
continued engagement as an employee, director or consultant, and shall not
interfere with Participant's right or the Company's right to terminate
Participant's relationship with the Company at any time, with or without Cause.
13. Interpretation. Any dispute regarding the interpretation of
this Agreement shall be submitted by Participant or the Company to the Committee
for review. The resolution of such a dispute by the Committee shall be final and
binding on the Company and Participant.
14. Notices. Any notice required to be given or delivered to the
Company under the terms of this Agreement shall be in writing and addressed to
the Corporate Secretary of the Company at its principal corporate offices. Any
notice required to be given or delivered to Participant shall be in writing and
addressed to Participant at the address indicated above or to such other address
as such party may designate in writing from time to time to the Company. All
notices shall be deemed to have been given or delivered upon the earlier of: (a)
when received; (b) when delivered personally; (c) four days after deposit in the
U.S. mail, first class with postage prepaid and properly addressed; (d) one
business day after deposit with any return receipt express courier (prepaid); or
(e) one business day after transmission by facsimile (transmission confirmed).
15. Successors and Assigns. The Company may assign any of its
rights under this Agreement. This Agreement shall be binding upon and inure to
the benefit of the successors and assigns of the Company. The rights granted to
the Participant under this Agreement are not assignable by the Participant under
any circumstances. Subject to the restrictions on transfer set forth herein,
this Agreement shall be binding upon Participant and Participant's heirs,
executors, administrators, legal representatives and successors.
16. Entire Agreement. The Plan is incorporated herein by
reference. This Agreement and the Plan constitute the entire agreement of the
parties with respect to the purchase of the Shares by the Participant and
supersede all prior written or oral undertakings and agreements, including, but
not limited to, any representations made during any interviews, discussions or
negotiations whether written or oral.
17. Severability. Should any provision of this Agreement be found
to be illegal or unenforceable, the other provisions shall nevertheless remain
effective and shall remain enforceable to the greatest extent permitted by law.
18. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Washington, without regard
to its provisions regarding conflicts of laws.
20. Counterparts. This Agreement may be executed in one or more
counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same agreement. Facsimile copies of signed
signature pages shall be binding originals.
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DATED as of the Date of Award set forth above.
PACIFIC BIOMETRICS, INC.
By:
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Its:
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Name:
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Acceptance by Participant:
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Participant acknowledges receipt of a copy of the Plan. Participant has reviewed
the Plan and this Agreement in their entirety, has had an opportunity to obtain
the advice of counsel prior to executing this Agreement and fully understands
all provisions of the Plan and this Agreement. Participant acknowledges that
there may be adverse tax consequences upon purchase or disposition of the Shares
and that Participant should consult a tax adviser prior to any such exercise or
disposition. Participant accepts this Agreement subject to all of the terms and
provisions of the Plan and this Agreement.
Date signed:
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(Signature)
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(Print Name)
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EXHIBIT A
ASSIGNMENT SEPARATE FROM CERTIFICATE
For value received and pursuant to that certain Restricted Stock
Purchase Agreement (the "Agreement"), the undersigned Participant hereby sells,
assigns and transfers to Pacific Biometrics, Inc., a Delaware corporation
("Company"), ________________________ (__________) shares of the Common Stock of
the Company, standing in the undersigned's name on the books of said corporation
represented by Certificate No. _____ herewith and do hereby irrevocably
constitute and appoint ____________________________ as attorney-in-fact to
transfer the said stock on the books of the Company with full power of
substitution in the premises. This Assignment may be used only in accordance
with and subject to the terms and conditions of the Agreement, in connection
with the reacquisition of shares of Common Stock of the Company issued to the
undersigned Participant pursuant to the Agreement, and only to the extent that
such Shares remain subject to the Company's Repurchase Option under the
Agreement.
Dated:
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Participant's Signature:
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Participant's Name:
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(please print)
EXHIBIT B
JOINT ESCROW INSTRUCTIONS
___________________, 20__
Corporate Secretary
Pacific Biometrics, Inc.
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Dear Sir/Madam:
As Escrow Agent for both Pacific Biometrics, Inc., a Delaware
corporation (the "Company"), and the undersigned recipient of stock of the
Company ("Recipient"), you are hereby authorized and directed to hold the
documents delivered to you pursuant to the terms of that certain Restricted
Stock Purchase Agreement ("Agreement"), in accordance with the following
instructions:
1. In the event Recipient ceases to render services to the
Company or an affiliate of the Company during the vesting period set forth in
the Agreement, the Company or its assignee will give to Recipient and you a
written notice specifying that the shares of stock shall be transferred to the
Company. Recipient and the Company hereby irrevocably authorize and direct you
to close the transaction contemplated by such notice in accordance with the
terms of said notice.
2. At the closing you are directed (a) to date any stock
assignments necessary for the transfer in question, (b) to fill in the number of
shares being transferred, and (c) to deliver same, together with the certificate
evidencing the shares of stock to be transferred, to the Company.
3. Recipient irrevocably authorizes the Company to deposit with
you any certificates evidencing shares of stock to be held by you hereunder and
any additions and substitutions to said shares as specified in the Agreement.
Recipient hereby irrevocably constitutes and appoints you as Recipient's
attorney-in-fact and agent for the term of this escrow to execute with respect
to such securities and other property all documents of assignment and/or
transfer and all stock certificates necessary or appropriate to make all
securities negotiable and complete any transaction herein contemplated.
4. This escrow shall terminate upon vesting of the shares or upon
the earlier return of the shares to the Company. From time to time, upon written
request of Recipient, duly confirmed by the Company, you will deliver to
Recipient a certificate representing the shares that have vested and that have
been released from the Company's repurchase option.
5. If at the time of termination of this escrow you should have
in your possession any documents, securities, or other property belonging to
Recipient, you shall deliver all of same to Recipient and shall be discharged of
all further obligations hereunder.
6. Your duties hereunder may be altered, amended, modified or
revoked only by a writing signed by all of the parties hereto.
7. You shall be obligated only for the performance of such duties
as are specifically set forth herein and may rely and shall be protected in
relying or refraining from acting on any instrument reasonably believed by you
to be genuine and to have been signed or presented by the proper party or
parties or their assignees. You shall not be personally liable for any act you
may do or omit to do hereunder as Escrow Agent or as attorney-in-fact for
Recipient while acting in good faith and any act done or omitted by you pursuant
to the advice of your own attorneys shall be conclusive evidence of such good
faith.
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8. You are hereby expressly authorized to disregard any and all
warnings given by any of the parties hereto or by any other person or
corporation, excepting only orders or process of courts of law, and are hereby
expressly authorized to comply with and obey orders, judgments or decrees of any
court. In case you obey or comply with any such order, judgment or decree of any
court, you shall not be liable to any of the parties hereto or to any other
person, firm or corporation by reason of such compliance, notwithstanding any
such order, judgment or decree being subsequently reversed, modified, annulled,
set aside, vacated or found to have been entered without jurisdiction.
9. You shall not be liable in any respect on account of the
identity, authority or rights of the parties executing or delivering or
purporting to execute or deliver the Agreement or any documents or papers
deposited or called for hereunder.
10. You shall not be liable for the outlawing of any rights under
any statute of limitations with respect to these Joint Escrow Instructions or
any documents deposited with you.
11. You shall be entitled to employ such legal counsel, including
but not limited to Cairncross & Hempelmann P.S., and other experts as you may
deem necessary properly to advise you in connection with your obligations
hereunder, may rely upon the advice of such counsel, and may pay such counsel
reasonable compensation therefor.
12. Your responsibilities as Escrow Agent hereunder shall terminate if
you shall cease to be Secretary of the Company or if you shall resign by written
notice to each party. In the event of any such termination, the Company may
appoint any officer or assistant officer of the Company as successor Escrow
Agent and Recipient hereby confirms the appointment of such successor or
successors as his attorney-in-fact and agent to the full extent of your
appointment.
13. If you reasonably require other or further instruments in
connection with these Joint Escrow Instructions or obligations in respect
hereto, the necessary parties hereto shall join in furnishing such instruments.
14. It is understood and agreed that should any dispute arise with
respect to the delivery and/or ownership or right of possession of the
securities, you may (but are not obligated to) retain in your possession without
liability to anyone all or any part of said securities until such dispute shall
have been settled either by mutual written agreement of the parties concerned or
by a final order, decree or judgment of a court of competent jurisdiction after
the time for appeal has expired and no appeal has been perfected, but you shall
be under no duty whatsoever to institute or defend any such proceedings.
15. Any notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given upon personal delivery or upon
deposit in the U.S. mail, by registered or certified mail with postage and fees
prepaid, addressed to each of the other parties hereunto entitled at the
following addresses, or at such other addresses as a party may designate by ten
days' written notice to each of the other parties hereto:
Company: Pacific Biometrics, Inc.
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Attn: Chief Executive Officer
Recipient:
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Escrow Agent: Pacific Biometrics, Inc.
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Attn: Corporate Secretary
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16. By signing these Joint Escrow Instructions you become a party
hereto only for the purpose of said Joint Escrow Instructions; you do not become
a party to the Agreement.
17. This instrument shall be binding upon and inure to the benefit
of the parties hereto, and their respective successors and permitted assigns. It
is understood and agreed that references to "you" or "your" herein refer to the
original Escrow Agent and to any and all successor Escrow Agents. It is
understood and agreed that the Company may at any time or from time to time
assign its rights under the Grant Notice and these Joint Escrow Instructions in
whole or in part.
Very truly yours,
PACIFIC BIOMETRICS, INC. RECIPIENT:
By: Signature:
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Name:
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Title: Name:
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Agreed and Accepted:
ESCROW AGENT:
By:
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Name:
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Title:
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EXHIBIT C
SECTION 83(b) ELECTION
The undersigned taxpayer hereby elects, pursuant to Section 83(b) of the
Internal Revenue Code of 1986, as amended, to include in his or her gross income
for the current taxable year, the amount of any compensation taxable to him or
her in connection with his or her receipt of the property described below:
(1) The taxpayer who performed the services is:
Name:
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Address:
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Social Security No.:
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(2) The property with respect to which the election is made is ___________
shares ("Shares") of common stock of Pacific Biometrics, Inc. (the
"Company").
(3) The Shares were transferred to the undersigned on ______________, 20__.
(4) The taxable year for which the election is made is the calendar year
20__.
(5) The Shares may be repurchased by the Company, or its assignee, if for
any reason taxpayer's service with the Company is terminated. The
Company's repurchase right lapses with respect to a portion of the
Shares over time.
(6) The fair market value of such Shares at the time of transfer
(determined without regard to any restriction other than a restriction
which by its terms will never lapse) is $_________.
(7) The amount, if any, paid for such Shares is $__________.
(8) A copy of this statement was furnished to the Company, for whom
taxpayer rendered the services underlying the transfer of such
property.
(9) The foregoing election may not be revoked except with the consent of
the Commissioner.
Dated: _______________, 20__.
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Spouse (if any) Taxpayer
THIS ELECTION MUST BE FILED WITH THE INTERNAL REVENUE SERVICE CENTER WITH WHICH
THE EMPLOYEE FILES HIS OR HER FEDERAL INCOME TAX RETURNS AND MUST BE FILED
WITHIN 30 DAYS AFTER THE DATE OF PURCHASE. THIS FILING SHOULD BE MADE BY
REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED. THE EMPLOYEE MUST RETAIN
TWO COPIES OF THE COMPLETED FORM FOR FILING WITH HIS OR HER FEDERAL AND STATE
TAX RETURNS FOR THE CURRENT TAX YEAR AND AN ADDITIONAL COPY FOR HIS OR HER
RECORDS.