Exhibit 10.21

PERFORMANCE VESTING SHARE AGREEMENT

THIS PERFORMANCE VESTING SHARE AGREEMENT(this "Agreement") is made
effective                                    (the "Grant Date"),
by and between Digimarc Corporation, a Delaware corporation (the "Company")
and                                    ("Executive"). In connection
with his services as Executive Vice President, the Company desires to grant
Executive a performance vesting share award of                        shares of the Company's common stock.

1.Grant of Performance Vesting Shares.The Company hereby
grants to Executive, as of the Grant Date, a performance vesting share award of                        shares of the Company's
common stock (the "Shares") pursuant to the terms and conditions contained in
this Agreement and the terms and conditions of the Company's Restated 1999 Stock Incentive Plan (the "1999 Plan"), subject to the vesting rules set forth in Section 2 below.

2.Vesting of the Shares.



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3.Restriction on Transfer.Executive shall not sell, transfer,
pledge, hypothecate, or otherwise dispose of any Shares prior to the Release Date.

4.Escrow of Shares.Promptly after the execution of this
Agreement, the Company shall cause the transfer agent for the Company's common stock to make a book entry record, showing ownership for the Shares in the name of Executive subject to the terms and
conditions of this Agreement. The Shares shall be issued from common stock reserved for issuance pursuant to the 1999 Plan as granted under such plan. Subject to the terms hereof, Executive shall have
all rights of a shareholder with respect to the Shares while they are held in escrow, including without limitation the right to vote the Shares and receive any cash dividends declared thereon. If,
from time to time prior to the earlier of the Expiration Date and the Release Date, there is (a) any stock dividend, stock split, or other change in the Shares, or (b) any merger or sale
of all or substantially all of the assets or other acquisition of the Company, any and all new, substituted, or additional securities to which Executive is entitled by reason of his ownership of the
Shares shall be held on his behalf by the Company's transfer agent and included thereafter as "Shares" for purposes of this Agreement and the forfeiture restriction. A certificate for the Shares
granted pursuant to this Agreement will be issued to Executive following the Release Date, or, at Executive's election, such Shares may be transferred in book-entry form to Executive's
brokerage account (subject to any adjustment made therein to withhold Shares to pay taxes as provided in Section 5.2 below).

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5.Tax Consequences.



6.Representations by Executive.Executive represents that the
Shares are being acquired for investment and that Executive has no present intention to transfer, sell, or otherwise dispose of the Shares, except
in compliance with applicable securities laws, and the parties agree that the Shares are being acquired in accordance with and subject to the terms, provisions, and conditions of this Agreement.

7.General Provisions.



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The
parties have duly executed this Agreement effective as of the date first set forth above.

|The Company:         |          
|-------------------- | ---------
|                     |          
|DIGIMARC CORPORATION |          
|                     |          
|                     |          
|By:                  |          
|Name:                |          
|Title:               | Secretary
|                     |          
|Executive:           |          
|                     |          
|                     |          
|Name:                |          

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EXHIBIT A        SECTION 83(b) ELECTION

The undersigned taxpayer hereby elects, pursuant to Section 83(b) of the Internal Revenue Code, to include in taxpayer's gross income for the current
taxable year, the amount of any compensation taxable to taxpayer in connection with taxpayer's receipt of the property described below:

1.     The
name, address, taxpayer identification number and taxable year of the undersigned are as follows:

| |  | Name of Taxpayer:               | 
| |  | ------------------------------- | 
| |  | Name of Spouse:                 | 
| |  | Address:                        | 
| |  |                                 | 
| |  | Identification No. of Taxpayer: | 
| |  | Identification No. of Spouse:   | 
| |  | Taxable Year:                   | 

2.     The
property with respect to which the election is made is described as follows:



3.     The
date on which the property was transferred is:                        , 20    .

4.     The
property is subject to the following restrictions:



5.     The
fair market value at the time of transfer, determined without regard to any restriction other than a restriction which by its terms will never lapse, of such property
is: $                  .

6.     The
amount (if any) paid for such property is: $0.00.

The
undersigned has submitted a copy of this statement to the person for whom the services were performed in connection with the undersigned's receipt of the above-described property.
The transferee of such property is the person performing the services in connection with the transfer of said property. The undersigned understands that the foregoing election may not be revoked
except with the consent of the Commissioner.

|               |  |      |  | 
|-------------- |  | ---- |  | 
|               |  | Date | 
|Taxpayer Name: |  |      |  | 
|               |  |      |  | 
|               |  |      |  | 
|               |  | Date | 
|Spouse Name:   |  |      |  | 

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