Exhibit 10.32

 

PURE Bioscience, Inc.

 

RESTRICTED STOCK UNITS AGREEMENT

(Executive Officer)

 

THIS RESTRICTED STOCK UNITS AGREEMENT (the “Agreement”) is made and entered into
as of the _____ day of ______ (the “Grant Date”), by and between PURE
BIOSCIENCE, INC., a Delaware corporation, and _____________ (the “Grantee”), an
executive officer of the Company. The Company has granted to the Grantee an
award (the “Award”) consisting of __________  (_____) Restricted Stock Units
(the “Total Number of Units”), subject to the terms and conditions of this
Agreement.  Each Unit represents a right to receive upon settlement one (1)
share of Stock. The Award has not been granted pursuant to any compensatory,
bonus, or similar plan maintained or otherwise sponsored by the Company
(collectively, the “Plan”), and the shares of Stock that may become issuable
upon settlement the Units shall not reduce the number of shares of Stock
available for issuance under any Plan.

 

1.DEFINITIONS AND CONSTRUCTION.

 

1.1Definitions.  Capitalized terms used herein shall have the following
meanings.

 

(a)“Board” means the Board of Directors of the Company. If one or more
committees of the Board of Directors have been appointed by the Board to
administer this Agreement, “Board” also means such committee(s).

 

(b)“Cause” shall have the same meaning as under Section 4.3(b) of the Employment
Agreement executed by and between the parties hereto and to which this Agreement
is attached as Exhibit A (the “Employment Agreement”).

 

(c)“Change in Control” shall have the same meaning as under Section 5.2 of the
Employment Agreement.

 

(d)“Code” means the Internal Revenue Code of 1986, as amended, and any
applicable regulations and administrative guidelines promulgated thereunder.

 

(e)“Company” means PURE Bioscience, Inc., a Delaware corporation, and any
successor thereto.

 

(f)“Complete Disability” shall have the same meaning as under Section 4.3(c) of
the Employment Agreement. 

 

(g)“Dividend Equivalent Units” mean additional Restricted Stock Units credited
pursuant to Section 2.3.

 

(h)“Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

(i)“Expiration Date” means the seventh (7th) anniversary of the Grant Date.

 

(j)“Fair Market Value” means as of any date, the value of a share of Stock or
other property as determined by the Board, in its discretion, or by the Company,
in its discretion, if such determination is expressly allocated to the Company
herein, subject to the following:

 

(i)If, on such date, the Stock is listed or quoted on a national or regional
securities exchange or quotation system, the Fair Market Value of a share of
Stock shall be the closing price of a share of Stock as quoted on the national
or regional securities exchange or quotation system constituting the

 

 

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primary market for the Stock, as reported in The Wall Street Journal or such
other source as the Board deems reliable. If the relevant date does not fall on
a day on which the Stock has traded on such securities exchange or quotation
system, the date on which the Fair Market Value shall be established shall be
the last day on which the Stock was so traded or quoted prior to the relevant
date, or such other appropriate day as shall be determined by the Board, in its
discretion.

 

(ii)If, on such date, the Stock is not listed or quoted on a national or
regional securities exchange or quotation system, the Fair Market Value of a
share of Stock shall be as determined by the Board in good faith without regard
to any restriction other than a restriction which, by its terms, will never
lapse.

 

(k)“Good Reason” shall have the same meaning as under Section 4.3(a) of the
Employment Agreement.

 

(l)“Participating Company” means the Company and any subsidiary of the Company.

 

(m)“Restricted Stock Unit” or “Unit” means a right to receive on the applicable
Settlement Date and in accordance with this Agreement one (1) share of Stock,
and includes the Total Number of Units originally granted pursuant to this
Agreement and the Dividend Equivalent Units credited pursuant to Section 2.3, as
both may be adjusted from time to time pursuant to Section  7.

 

(n)“Securities Act” means the Securities Act of 1933, as amended.

 

(o)“Service” means the Grantee’s service to the Company as an employee, director
or consultant. The Grantee’s Service shall not be deemed to have been
interrupted or terminated if the Grantee takes any sick leave, or other bona
fide leave of absence approved by the Company’s Board of Directors.

 

(p)“Service Condition” means the condition to the vesting of the Award. The
Service Condition is satisfied based on the duration of the Grantee’s continuous
Service from the Grant Date, as provided by Section 3.1.

 

(q)“Settlement Date” means, for each Vested Unit, the earliest of (i) the
six-month anniversary of the date the Service Condition is satisfied with
respect to such Vested Unit (or, at the sole discretion of the Board, at such
later date during the same calendar year); (ii) the date the Grantee’s Service
ceases for any reason and such cessation constitutes a “separation from service”
within the meaning of Section 409A of the Code; or (iii) the date of a Change in
Control that constitutes a “change in control event” within the meaning of
Section 409A of the Code.  Notwithstanding the foregoing, if the Settlement Date
is scheduled to occur on a date that is not a business day, the Settlement Date
shall instead occur on the next following business day.  In addition, if the
Settlement Date does not occur (A) during an “open window period” applicable to
the Grantee, as determined by the Company in accordance with its then effective
insider trading policy or (B) on a date when the grantee is otherwise permitted
to sell shares of Stock on an established stock exchange or quotation system,
then the Settlement Date shall be extended to the first business day when the
Grantee is not prohibited from selling shares of Stock in the open public
market, but in no event later than December 31 of the calendar year in which the
Settlement Date was scheduled to occur, or, if and only if, permitted in a
manner that complies with Treasury Regulations Section 1.409A-1(b)(4), no later
than the date that is the 15th day of the third calendar month of the applicable
year following the year in which the shares of Stock subject to this Award are
no longer subject to a “substantial risk for forfeiture” within the meaning of
Treasury Regulations Section 1.409A-1(d). 

 

(r)“Stock” means the common stock of the Company, subject to adjustment as
provided by Section  7.

 

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(s)“Trading Compliance Policy” means the written policy of the Company
pertaining to the purchase, sale, transfer or other disposition of the Company’s
equity securities by directors, officers, employees or other service providers
who may possess material, nonpublic information regarding the Company or its
securities.

 

(t)“Vested Unit” means a Unit that has vested in accordance with Section 3 and
ceased to be subject to the Company Reacquisition Right described in
Section 4.1.

 

1.2Construction.  Captions and titles contained herein are for convenience only
and shall not affect the meaning or interpretation of any provision of this
Agreement. Except when otherwise indicated by the context, the singular shall
include the plural and the plural shall include the singular. Use of the term
“or” is not intended to be exclusive, unless the context clearly requires
otherwise.

 

2.THE AWARD.

 

2.1Grant of Units.  On the Grant Date, the Grantee shall acquire, subject to the
provisions of this Agreement, the Total Number of Units, subject to adjustment
as provided in Section 7. Each Unit represents a right to receive one (1) share
of Stock on the applicable Settlement Date and in accordance with this
Agreement.

 

2.2No Monetary Payment Required. The Grantee is not required to make any
monetary payment (other than applicable tax withholding, if any) as a condition
to receiving the Units or shares of Stock issued upon the vesting or settlement
of the Units, the consideration for which shall be services to be rendered to a
Participating Company or for its benefit.  Notwithstanding the foregoing, if
required by applicable law, the Grantee shall furnish consideration in the form
of cash or past services rendered to a Participating Company or for its benefit
having a value not less than the par value of the shares of Stock issued upon
settlement of the Units.

 

2.3Dividend Equivalent Units. On the date that the Company pays a cash dividend
or other cash distribution to holders of Stock generally, the Grantee shall be
credited with a number of additional whole Dividend Equivalent Units determined
by dividing (a) the product of (i) the dollar amount of the cash dividend or
distribution paid per share of Stock on such date and (ii) the total number of
Units previously credited to the Grantee pursuant to this Agreement which have
not been settled or forfeited pursuant to the Company Reacquisition Right (as
defined below) as of such date, by (b) the Fair Market Value per share of Stock
on such date. Any resulting fractional Dividend Equivalent Unit shall be rounded
to the nearest whole number. Such additional Dividend Equivalent Units shall be
subject to the same terms and conditions and shall be settled or forfeited in
the same manner and at the same time as the Units originally subject to this
Agreement with respect to which they have been credited.

 

2.4Termination of the Award. The Award shall terminate upon the first to occur
of (a) the final settlement of all Vested Units in accordance with Section 5
(including a final settlement upon the termination or cessation of Grantee’s
Services) or (b) the Expiration Date if settlement has not occurred on or before
the Expiration Date.

 

3.VESTING OF UNITS.

 

3.1Satisfaction of Service Condition. Except as provided by Section 3.2 below
and subject to the Grantee’s continuous Service through the applicable date set
forth in the table below (each a, “Service Date”), the Service Condition will be
satisfied in accordance with the following schedule:

 

Service Date

Percentage of Units

 

 

 

 

 

 

 

 

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3.2[Satisfaction of Performance Condition. Except as provided by Section 3.3
below and subject to the Grantee’s continuous Service through the date of the
satisfaction of the applicable Performance Condition, the Performance Condition
will be satisfied as follows]:  

 

Percentage of Units

Performance Metric

 

 

 

 

 

3.3Vesting Upon Change in Control or Upon Termination Without Cause or Due to
Death, Disability or Good Reason.  Upon the Occurrence of a Change in Control,
then the Service Condition will be satisfied with respect to one-hundred percent
(100%) of the Total Number of Units that are subject to vesting upon
satisfaction of a Service Condition effective as of the date of such Change in
Control.  If the Grantee’s Service is involuntarily terminated by the Company
for any reason other than Cause or the Grantee’s Service terminates as a result
of the Grantee’s death or Disability or Grantee terminates his Service for Good
Reason, then the Service Condition will be satisfied with respect to one-hundred
percent (100%) of the Total Number of Units that are subject to vesting upon
satisfaction of a Service Condition effective as of the date of such termination
of Service.

 

3.4Effect of Termination of Service.  Subject to the vesting provisions in
Sections 3.1, and 3.2 above, upon the termination of Grantee’s Service (whether
by the Company or by Grantee and whether for Cause or for any or no reason),
then:

 

(a)all Units for which the applicable Service Condition has not been satisfied
as of the date of such termination of Service shall be subject to the Company
Reacquisition Right (as defined in Section 4.1) immediately upon the termination
of Grantee’s Service; and

 

(b)all Units for which the applicable Service Condition has been satisfied as of
the date of such termination of Service (including as a result of Section 3.3)
shall not be subject to the Company Reacquisition Right, but instead shall
remain Vested Units. 

 

3.5Payments Upon Vesting.  Upon the Vesting of any Units pursuant to Sections
3.1, or 3.2, above, the Company shall:

(a)if Grantee is an employee at the time of Vesting, withhold, on behalf of
Grantee, the Federal Insurance Contributions Act tax imposed pursuant to
Sections 3101 and 3121(v)(2) of the Code on the Vested Units (the “FICA
Amount”).  In addition, the Company shall pay Grantee an amount equal to the sum
of (A) the FICA Amount, plus (B) a tax gross-up payment (computed at the highest
applicable marginal rate) in an amount that, after payment of all federal,
state, and local income and employment taxes, results in the Grantee’s receipt
and retention, on an after-tax basis, of an amount equal to all federal, state,
and local taxes payable by Grantee on the FICA Amount.

(b)if Grantee is a director or consultant at the time of Vesting, pay Grantee an
amount equal to the sum of (A) the taxes imposed pursuant to Section 1401 of the
Code on the Vested Units that are treated as “self-employment income” (as
defined in Section 1402(b) of the Code), plus (B) a tax gross-up payment
(computed at the highest applicable marginal rate) in an amount that, after
payment of all federal, state, and local income and employment taxes, results in
the Grantee’s receipt and retention, on an after-tax basis, of an amount equal
to all federal, state, and local taxes payable by Grantee on the amount
specified in Section 3.4(b)(A).

 

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The Company shall make any payments due to Grantee pursuant to this Section 3.4
within 24 hours of the Vesting of any Units by wire transfer to the account
designated by Grantee.

 

3.6Federal Excise Tax Under Section 4999 of the Code.

 

(a)Excess Parachute Payment. If any acceleration of vesting pursuant to the
Award and any other payment or benefit (collectively, the “Payments”) received
or to be received by the Grantee would, but for this Section, subject the
Grantee to any excise tax pursuant to Section 4999 of the Code or any similar or
successor provision (the “Excise Tax”) due to the characterization of such
acceleration of vesting, payment or benefit as an “excess parachute payment”
under Section 280G of the Code, then the aggregate amount of the Payments will
be either fully payable or reduced to the largest portion of the Payments that
would result in no portion of the Payments (after reduction) being subject to
the Excise Tax, whichever results in the Grantee receiving the greatest amount
of Payments, on an after-tax basis (accounting for federal, state, and local
income taxes and the Excise Tax), even if some or all of the Payments are
subject to the Excise Tax.  Any reduction in the Payments required by this
Section will be made in the following order: (i) reduction of cash payments;
(ii) reduction of accelerated vesting of equity awards other than stock options;
(iii) reduction of accelerated vesting of stock options; and (iv) reduction of
other benefits paid or provided to the Grantee.  In the event that acceleration
of vesting of equity awards is to be reduced, such acceleration of vesting will
be cancelled in the reverse order of the date of grant of the Grantee’s equity
awards.  If two or more equity awards are granted on the same date, each award
will be reduced on a pro-rata basis.

 

(b)Determination by Tax Firm.  No later than the date of the occurrence of any
event that might reasonably be anticipated to result in an “excess parachute
payment” to the Grantee, the Company shall request a determination in writing by
the professional firm engaged by the Company for general tax purposes, or, if
the tax firm so engaged by the Company is serving as accountant or auditor for
the acquiror, the Company will appoint a nationally recognized tax firm to make
the determinations required by this Section. (the “Tax Firm”).  As soon as
practicable thereafter, the Tax Firm shall determine and report to the Company
and the Grantee the amount of such acceleration of vesting, payments and
benefits to be reduced, if any.  For the purposes of such determination, the Tax
Firm may rely on reasonable, good faith interpretations concerning the
application of Sections 280G and 4999 of the Code.  The Company and the Grantee
shall furnish to the Tax Firm such information and documents as the Tax Firm may
reasonably request in order to make its required determination.  The Company
shall bear all fees and expenses the Tax Firm charge in connection with its
services contemplated by this Section.

 

4.COMPANY REACQUISITION RIGHT.

 

4.1Grant of Company Reacquisition Right. In the event that the Grantee’s Service
terminates for any reason, the Grantee shall forfeit and the Company shall
automatically reacquire all Units for which the applicable Service Condition has
not been satisfied as of the time of such termination in accordance with Section
3 (the “Unvested Units”), and the Grantee shall not be entitled to any payment
therefor (the “Company Reacquisition Right”).

 

4.2Dividends, Distributions and Adjustments. Upon the occurrence of a dividend
or distribution to the stockholders of the Company paid in shares of Stock or
other property, or any other adjustment upon a change in the capital structure
of the Company as described in Section 7, any and all new, substituted or
additional securities or other property to which the Grantee is entitled by
reason of the Grantee’s ownership of Unvested Units shall be immediately subject
to the Company Reacquisition Right and included in the terms “Units” and
“Unvested Units” for all purposes of the Company Reacquisition Right with the
same force and effect as the Unvested Units immediately prior to the dividend,
distribution or adjustment, as the case may be.  For purposes of determining the
number of Units for which the applicable Service Condition has been satisfied
following a dividend, distribution or adjustment, credited Service shall include
all Service with any corporation which is a Participating Company at the time
the Service is rendered, whether or not such corporation is a Participating
Company both before and after any such event.

 

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5.SETTLEMENT OF THE UNITS.

 

5.1Issuance of Shares of Stock. Subject to the provisions of Section 5.3 below,
the Company shall issue to the Grantee on the Settlement Date with respect to
each Vested Unit to be settled on such date one (1) share of Stock. Shares of
Stock issued in settlement of Units are not registered under federal or state
securities laws. 

 

5.2Beneficial Ownership of Shares. A certificate for the shares acquired by the
Grantee shall be registered in the name of the Grantee, or, if applicable, in
the names of the heirs of the Grantee.

 

5.3Restrictions on Grant of the Units and Issuance of Shares. As of the date of
this Agreement, the grant of the Units and issuance of shares of Stock upon
settlement of the Units have not been registered under federal or state
securities laws, and as a result, shall be subject to compliance with all
applicable requirements of federal, state or foreign law with respect to such
securities. No shares of Stock may be issued hereunder if the issuance of such
shares would constitute a violation of any applicable federal, state or foreign
securities laws or other law or regulations or the requirements of any stock
exchange or market system upon which the Stock may then be listed.  The
inability of the Company to obtain from any regulatory body having jurisdiction
the authority, if any, deemed by the Company’s legal counsel to be necessary to
the lawful issuance of any shares subject to this Agreement shall relieve the
Company of any liability in respect of the failure to issue such shares as to
which such requisite authority shall not have been obtained.  As a condition to
the settlement of the Units, the Company may require the Grantee to satisfy any
qualifications that may be necessary or appropriate, to evidence compliance with
any applicable law or regulation and to make any representation or warranty with
respect thereto as may be requested by the Company.

 

5.4Transfer of Shares.  The Grantee may not transfer the shares of Stock issued
upon settlement of the Units except in compliance with applicable federal and
state securities laws and the Company’s insider trading policy.

5.5Fractional Shares.  The Company shall not be required to issue fractional
shares upon the settlement of the Units.

 

6.TAX WITHHOLDING.

 

6.1In General. Subject to the obligations of the Participating Company under
Sections 3 and  6.2 , at the time this Agreement is executed, or at any time
thereafter as requested by a Participating Company, the Grantee hereby
authorizes withholding from payroll and any other amounts payable to the
Grantee, and otherwise agrees to make adequate provision for, any sums required
to satisfy the federal, state, local and foreign tax (including any social
insurance) withholding obligations of the Participating Company, if any, which
arise in connection with the grant of Units, the vesting of Units or the
issuance of shares of Stock in settlement thereof. The Company shall have no
obligation to deliver shares of Stock until the tax withholding obligations of
the Participating Company have been satisfied by the Grantee.

 

6.2Assignment of Sale Proceeds. Subject to compliance with applicable law and
the Company’s Trading Compliance Policy, if permitted by the Company, the
Grantee may satisfy the Participating Company’s tax withholding obligations in
accordance with procedures established by the Company providing for delivery by
the Grantee to the Company or a broker approved by the Company of properly
executed instructions, in a form approved by the Company, providing for the
assignment to the Company of the proceeds of a sale with respect to some or all
of the shares being acquired upon settlement of Units.

 

 

7.ADJUSTMENTS FOR CHANGES IN CAPITAL STRUCTURE.

 

Subject to any required action by the stockholders of the Company and the
requirements of Section 409A of the Code to the extent applicable, in the event
of any change in the Stock effected without

 

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receipt of consideration by the Company, whether through merger, consolidation,
reorganization, reincorporation, recapitalization, reclassification, stock
dividend, stock split, reverse stock split, split-up, split-off, spin-off,
combination of shares, exchange of shares, or similar change in the capital
structure of the Company, or in the event of payment of a dividend or
distribution to the stockholders of the Company in a form other than Stock
(other than regular, periodic cash dividends paid on Stock pursuant to the
Company’s dividend policy) that has a material effect on the Fair Market Value
of shares of Stock, appropriate and proportionate adjustments shall be made in
the number of Units subject to this Agreement and/or the number and kind of
shares or other property to be issued in settlement of the Units, in order to
prevent dilution or enlargement of the Grantee’s rights under this
Agreement.  For purposes of the foregoing, conversion of any convertible
securities of the Company shall not be treated as “effected without receipt of
consideration by the Company.” Any and all new, substituted or additional
securities or other property (other than regular, periodic cash dividends paid
on Stock pursuant to the Company’s dividend policy) to which the Grantee is
entitled by reason of ownership of Units acquired pursuant to this Agreement
will be immediately subject to the provisions of this Agreement on the same
basis as all Units originally acquired hereunder. Any fractional Unit or share
resulting from an adjustment pursuant to this Section shall be rounded down to
the nearest whole number.  Such adjustments shall be determined by the Board,
and its determination shall be final, binding and conclusive.

 

8.RIGHTS AS A STOCKHOLDER OR EMPLOYEE.

 

The Grantee shall have no rights as a stockholder with respect to any shares
which may be issued in settlement of the Units until the date of the issuance of
such shares (as evidenced by the appropriate entry on the books of the Company
or of a duly authorized transfer agent of the Company).  No adjustment shall be
made for dividends, distributions or other rights for which the record date is
prior to the date the shares of Stock are issued, except as provided in Section
2.3 or Section  7.  The Grantee understands and acknowledges that the Grantee’s
Services to the Company is dictated by the Employment Agreement. Nothing in this
Agreement shall confer upon the Grantee any right to continue in the Service of
a Participating Company or interfere in any way with any right of a
Participating Company to terminate the Grantee’s Service at any time.

 

9.LEGENDS.

 

The Company may at any time place legends referencing any applicable federal,
state or foreign securities law restrictions on all certificates representing
shares of stock issued pursuant to this Agreement.  The Grantee shall, at the
request of the Company, promptly present to the Company any and all certificates
representing shares acquired pursuant to this Agreement in the possession of the
Grantee in order to carry out the provisions of this Section.  Unless otherwise
specified by the Company, legends placed on such certificates may include, but
shall not be limited to, the following:

 

“THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED
OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH
ACT COVERING SUCH SECURITIES, THE SALE IS MADE IN ACCORDANCE WITH RULE 144 OR
RULE 701 UNDER THE ACT, OR THE COMPANY RECEIVES AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE COMPANY, STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR
HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY
REQUIREMENTS OF SUCH ACT.”

 

10.COMPLIANCE WITH SECTION 409A.

 

It is intended that any election, payment or benefit which is made or provided
pursuant to or in connection with this Agreement that may result in or relate to
the deferral of compensation within the meaning of Section 409A of the Code
(“Section 409A Deferred Compensation”) shall comply in all respects with the

 

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applicable requirements of Section 409A of the Code (including applicable
regulations or other administrative guidance thereunder, as determined by the
Board in good faith) to avoid the unfavorable tax consequences provided therein
for non-compliance.  In connection with effecting such compliance with Section
409A of the Code, the following shall apply:

 

10.1Separation from Service; Required Delay in Payment to Specified Grantee. 
Notwithstanding anything set forth herein to the contrary, no amount payable
pursuant to this Agreement on account of the Grantee’s termination of Service
which constitutes Section 409A Deferred Compensation shall be paid unless and
until the Grantee has incurred a “separation from service” within the meaning of
Section 409A of the Code.  Furthermore, to the extent that the Grantee is a
“specified employee” within the meaning of the Section 409A as of the date of
the Grantee’s separation from service, no amount that constitutes a deferral of
compensation which is payable on account of the Grantee’s separation from
service shall be paid to the Grantee before the date (the “Delayed Payment
Date”) which is first day of the seventh month after the date of the Grantee’s
separation from service or, if earlier, the date of the Grantee’s death
following such separation from service.  All such amounts that would, but for
this Section, become payable prior to the Delayed Payment Date will be
accumulated and paid on the Delayed Payment Date.

 

10.2Other Changes in Time of Payment.  Neither the Grantee nor the Company shall
take any action to accelerate or delay the payment of any benefits under this
Agreement in any manner which would not be in compliance with Section 409A of
the Code.

 

10.3Amendments to Comply with Section 409A; Indemnification.  Notwithstanding
any other provision of this Agreement to the contrary, the Company is authorized
to amend this Agreement, to void or amend any election made by the Grantee under
this Agreement and/or to delay the payment of any monies and/or provision of any
benefits in such manner as may be determined by the Company, in its discretion,
to be necessary or appropriate to comply with Section 409A of the Code without
prior notice to or consent of the Grantee.  The Grantee hereby releases and
holds harmless the Company, its directors, officers and stockholders from any
and all claims that may arise from or relate to any tax liability, penalties,
interest, costs, fees or other liability incurred by the Grantee in connection
with this Agreement, including as a result of the application of Section 409A of
the Code.

 

10.4Advice of Independent Tax Advisor. The Company has not obtained a tax ruling
or other confirmation from the Internal Revenue Service with regard to the
application of Section 409A to this Agreement, and the Company does not
represent or warrant that this Agreement will avoid adverse tax consequences to
the Grantee, including as a result of the application of Section 409A of the
Code. The Grantee hereby acknowledges that he or she has been advised to seek
the advice of his or her own independent tax advisor prior to entering into this
Agreement and is not relying upon any representations of the Company or any of
its agents as to the effect of or the advisability of entering into this
Agreement.

 

11.ADMINISTRATION.

 

All questions of interpretation concerning this Agreement or any other form of
agreement or other document employed by the Company in the administration of
this Agreement shall be determined by the Board. All such determinations by the
Board shall be final, binding and conclusive upon all persons having an interest
in this Agreement, unless fraudulent or made in bad faith. Any and all actions,
decisions and determinations taken or made by the Board in the exercise of its
discretion pursuant to this Agreement or other agreement thereunder (other than
determining questions of interpretation pursuant to the preceding sentence)
shall be final, binding and conclusive upon all persons having an interest in
this Agreement.  Any officer of the Company shall have the authority to act on
behalf of the Company with respect to any matter, right, obligation, or election
which is the responsibility of or which is allocated to the Company herein,
provided the officer has apparent authority with respect to such matter, right,
obligation, or election.

 

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12.REPRESENTATIONS AND WARRANTIES OF GRANTEE.

 

In connection with the acquisition of securities pursuant to this Agreement, the
Grantee hereby agrees, represents and warrants as follows:

 

12.1Investment Intent.  The Grantee is acquiring shares of Stock pursuant to
this Agreement solely for the Grantee’s own account for investment and not with
a view to or for sale in connection with any distribution of the shares or any
portion thereof and not with any present intention of selling, offering to sell
or otherwise disposing of or distributing the shares or any portion thereof in
any transaction other than a transaction exempt from registration under the
Securities Act.  The Grantee further represents that the entire legal and
beneficial interest of the shares is being acquired, and will be held, for the
account of the Grantee only and neither in whole nor in part for any other
person.

 

12.2Absence of Solicitation.  The Grantee was not presented with or solicited by
any form of general solicitation or general advertising, including, but not
limited to, any advertisement, article, notice, or other communication published
in any newspaper, magazine, or similar media, or broadcast over television,
radio or similar communications media, or presented at any seminar or meeting
whose attendees have been invited by any general solicitation or general
advertising.

 

12.3Capacity to Protect Interests.  The Grantee has either (a) a preexisting
personal or business relationship with the Company or any of its officers,
directors, or controlling persons, consisting of personal or business contacts
of a nature and duration to enable the Grantee to be aware of the character,
business acumen and general business and financial circumstances of the person
with whom such relationship exists, or (b) such knowledge and experience in
financial and business matters (or has relied on the financial and business
knowledge and experience of the Grantee’s professional advisor who is
unaffiliated with and who is not, directly or indirectly, compensated by the
Company or any affiliate or selling agent of the Company) as to make the Grantee
capable of evaluating the merits and risks of the investment in shares acquired
pursuant to this Agreement and to protect the Grantee’s own interests in the
transaction, or (c) both such relationship and such knowledge and experience.

 

12.4Registered Securities.    The issuance to Grantee of shares pursuant to this
Agreement has been registered under the Securities Act under the Form S-8
November 18, 2013.

 

 

13.MISCELLANEOUS PROVISIONS.

 

13.1Termination or Amendment.  The Board may terminate or amend this Agreement
at any time; provided, however, no such termination or amendment may adversely
affect the Grantee’s rights under this Agreement without the consent of the
Grantee unless such termination or amendment is necessary to comply with
applicable law or government regulation, including, but not limited to, Section
409A of the Code.  No amendment or addition to this Agreement shall be effective
unless in writing.

 

13.2Non-transferability of Units.  Prior to the issuance of shares of Stock on
the applicable Settlement Date, neither this Agreement nor any Units subject to
this Agreement shall be subject in any manner to anticipation, alienation, sale,
exchange, transfer, assignment, pledge, encumbrance, or garnishment by creditors
of the Grantee or the Grantee’s beneficiary, except transfer by will or by the
laws of descent and distribution.  All rights with respect to this Agreement
shall be exercisable during the Grantee’s lifetime only by the Grantee or the
Grantee’s guardian or legal representative.

 

13.3Further Instruments.  The parties hereto agree to execute such further
instruments and to take such further action as may reasonably be necessary to
carry out the intent of this Agreement.

 

13.4Binding Effect.  This Agreement shall inure to the benefit of the successors
and assigns of the Company and, subject to the restrictions on transfer set
forth herein, be binding upon the Grantee and the Grantee’s heirs, executors,
administrators, successors and assigns.

 

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13.5Delivery of Documents and Notices.  Any document relating to this Agreement
or any notice required or permitted hereunder shall be given in writing and
shall be deemed effectively given (except to the extent that this Agreement
provides for effectiveness only upon actual receipt of such notice) upon
personal delivery, electronic delivery at the e-mail address, if any, provided
for the Grantee by a Participating Company, or upon deposit in the U.S. Post
Office or foreign postal service, by registered or certified mail, or with a
nationally recognized overnight courier service, with postage and fees prepaid,
addressed to the other party at the address of such party set forth below or at
such other address as such party may designate in writing from time to time to
the other party.

 

(a)Description of Electronic Delivery.  This Agreement and any reports of the
Company provided generally to the Company’s stockholders may be delivered to the
Grantee electronically.  Such means of electronic delivery may include but do
not necessarily include the delivery of a link to a Company intranet or the
Internet site of a third party involved in administering this Agreement, the
delivery of the document via e-mail or such other means of electronic delivery
specified by the Company.

 

(b)Consent to Electronic Delivery.  The Grantee acknowledges that the Grantee
has read Section 13.5(a) of this Agreement and consents to the electronic
delivery of the documents described in such Section.  The Grantee acknowledges
that he or she may receive from the Company a paper copy of any documents
delivered electronically at no cost to the Grantee by contacting the Company by
telephone or in writing.  The Grantee further acknowledges that the Grantee will
be provided with a paper copy of any documents if the attempted electronic
delivery of such documents fails.  The Grantee may revoke his or her consent to
the electronic delivery of documents described in Section 13.5(a) or may change
the electronic mail address to which such documents are to be delivered (if
Grantee has provided an electronic mail address) at any time by notifying the
Company of such revoked consent or revised e-mail address by telephone, postal
service or electronic mail.  Finally, the Grantee understands that he or she is
not required to consent to electronic delivery of documents described in Section
13.5(a).

 

13.6Integrated Agreement. This Agreement, together with the Employment
Agreement, shall constitute the entire understanding and agreement of the
Grantee and the Company with respect to the subject matter contained herein and
shall supersede any prior agreements, understandings, restrictions,
representations, or warranties between the Grantee and the Company with respect
to such subject matter.  To the extent contemplated herein, the provisions of
this Agreement shall survive any settlement of the Units and shall remain in
full force and effect.

 

13.7Applicable Law. This Agreement will be governed by the laws of the State of
California, without giving effect to the conflict of law principles thereof. For
purposes of litigating any dispute that arises under this Agreement, the parties
hereby submit to and consent to the jurisdiction of the State of California, and
agree that such litigation will be conducted in the courts of San Diego County,
California, or the federal courts for the United States for the Southern
District of California, and no other courts, where this Agreement is made and/or
to be performed.

 

13.8Counterparts.  This Agreement may be executed in counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.

 

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PURE BIOSCIENCE, INC.

 

 

 

 

 

 

 

 

 

 

Date:

 

 

By:

 

 

 

 

 

Dave Pfanzelter, Chairman

 

ACCEPTANCE

 

The Grantee represents that the Grantee has read and is familiar with the terms
and provisions of this Agreement and hereby accepts the Award subject to all of
the terms and provisions hereof.  The Grantee hereby agrees to accept as
binding, conclusive and final all decisions or interpretations of the Board of
Directors of the Company upon any questions arising under this Agreement.

 

 

 

 

GRANTEE

 

 

 

 

 

 

 

 

Date:

 

 

 

 

 

 

 

 

 

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Exhibit A

 

Employment Agreement

 

 

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