Document:

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EXHIBIT 10.32 TO FORM 10-KSB PACIFIC BIOMETRICS INC. 6/30/01

                               SECOND AMENDMENT TO
                    AGREEMENT OF PURCHASE AND SALE OF ASSETS

                  This Second Amendment To Agreement Of Purchase And Sale of
Assets (the "Amendment") is made and entered into effective this 4th day of
August, 2000, by and between Saigene Corporation, a Delaware corporation (the
"Buyer"), on the one hand, and Pacific Biometrics, Inc., a Delaware corporation
(hereinafter referred to as the "Parent"), and Pacific Biometrics, Inc., a
Washington corporation (hereinafter referred to as the "Subsidiary"), on the
other hand. Parent and Subsidiary are sometimes hereinafter collectively
referred to as the "Selling Parties."

                                    RECITALS:
                                    --------

                  WHEREAS, the parties have entered into that certain Agreement
Of Purchase And Sale Of Assets, dated April 18, 2000, by and between the Buyer
and Selling Parties (the "Asset Purchase Agreement") and the First Amendment to
Agreement of Purchase and Sale of Assets, dated June 22, 2000 (the "First
Amendment"); and

                  WHEREAS, Buyers seeks to modify the timing of the payments
required under the Asset Purchase Agreement and the First Amendment and to
extend the Closing Date; and

                  WHEREAS, Selling Parties are willing to modify the timing of
the payments and to extend the Closing Date of the Asset Purchase Agreement, as
amended by the First Amendment, on the terms and conditions state herein.

                  NOW, THEREFORE, in consideration of the mutual covenants set
forth herein, and other good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the parties agree as follows:

                                   AGREEMENT:
                                   ---------

                  1. EXTENSION OF CLOSING DATE. The parties agree that the term
"Closing Date" shall now mean January 20, 2001 instead of August 15, 2000.
Notwithstanding the foregoing, Buyer may advance the Closing Date at any time by
paying the remaining balance of the Purchase Price, or may extend the Closing
Date as provided in Section 3, below.

                  2. PAYMENT OF PURCHASE PRICE. The parties acknowledge and
agree that Buyer has paid Seventy-Five Thousand Dollars ($75,000.00) of the One
Hundred Fifty Thousand Dollars ($150,000.00) required to be paid, on or before
July 15, 2000, under the First Amendment, and that the following provisions
shall replace the provisions of the First Amendment with respect to the payment
of the Purchase Price: (a) In addition to the $75,000.00

                             Exhibit 10.32, Page 1
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previously paid on or about July 17, 2000, Buyer shall pay Selling Parties the
sum of Twenty Thousand Dollars ($20,000.00) on August 28, 2000, and then pay
$20,000.00 on the 20th day of each calendar month thereafter until the Closing
Date (which $20,000.00 payments shall each hereinafter collectively be referred
to as the "Extension Payments"); (b) Ten Thousand Dollars ($10,000.00) of each
of the Extension Payments shall constitute consideration for the extension of
the Closing Date and shall not be credited towards payment of the Purchase
Price, and the remaining Ten Thousand Dollars ($10,000.00) of each such
Extension Payment shall be credited against the cash portion of the Purchase
Price; (c) on the Closing Date, Buyer shall pay to Selling Parties the remaining
cash portion of the Purchase Price required under Section 1.3(d)(ii) of the
Asset Purchase Agreement (which amount is currently $275,000.00); and (d) on the
Closing Date, Buyer shall place Three Hundred Thousand Dollars ($300,000.00)
into escrow as required under Section 1.3(d)(iii) of the Asset Purchase
Agreement, subject to reduction as provided in this Second Amendment. The
$10,000.00 of each Extension Payment credited against the Purchase Price shall
reduce the $300,000.00 Buyer is required to place in escrow at the Closing under
Section 1.3(d)(iii) of the Asset Purchase Agreement. The Extension Payments are
subject to the same conditions as the Fifty Thousand Dollars ($50,000.00)
previously paid under section 1.3(d)(i) of the Asset Purchase Agreement.
Additionally, Buyer's failure to pay any Extension Payment within Five (5) days
of its due date shall constitute a material default by Buyer.

                  3. FURTHER EXTENSION OF CLOSING DATE. Buyer may extend the
Closing Date beyond January 20, 2001, for additional 30-day periods by paying to
Selling Parties the sum of Thirty Thousand Dollars ($30,000.00) for each such
extension (the "Extension Fee"). Fifteen Thousand Dollars ($15,000.00) of each
Extension Fee paid by Buyer shall constitute consideration of the additional
extension of the Closing Date and shall not be credited towards payment of the
Purchase Price, and the remaining Fifteen Thousand Dollars ($15,000.00) of each
Extension Fee shall be credited against the cash portion of the Purchase Price.
Again, the $15,000.00 of each Extension Fee credited against the Purchase Price
shall reduce the $300,000.00 Buyer is required to place in escrow at the Closing
under Section 1.3(d)(iii) of the Asset Purchase Agreement. However, in the event
that the Closing does not take place on or before January 20, 2001, then the
Selling Parties may terminate the Asset Purchase Agreement at the end of any
extension period by giving Buyer not less than Twenty (20) days written notice.
For example, if the Closing does not occur on or before January 20, 2001, and
Buyer pays the Extension Fee to the Selling Parties on or before such date
(thereby extending the Closing Date to February 19, 2001), then the Selling
Parties may terminate the Asset Purchase Agreement on February 19, 2001
(assuming the Closing does not occur on or before such date) by giving Buyer
written notice on or before January 31, 2001 of their intent to terminate the
Asset Purchase Agreement as of February 19, 2001.

                  4. COUNTERPARTS; FACSIMILE SIGNATURES. This Amendment may be
executed in one or more counterparts, using facsimile signatures, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.

                  5. OTHER TERMS REMAIN IN EFFECT. All other terms and
provisions of the Asset Purchase Agreement and First Amendment shall remain in
full force and effect. Any

                             Exhibit 10.32, Page 2

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capitalized terms not defined herein shall have the meanings set forth in the
Asset Purchase Agreement.

                  IN WITNESS WHEREOF, the parties hereto have duly executed this
Second Amendment as of the day and year first above written.

<TABLE>
<CAPTION>
         BUYER                                       PARENT
         -----                                       ------
<S>                                                  <C>
         Saigene Corporation                         Pacific Biometrics, Inc.,
         a Delaware corporation                      a Delaware corporation

By:      /s/__________________________               By:      /s/__________________________
         Ronald R. Helm                                       Paul Kanan
         Its:     Chief Executive Officer                     Its:     Chief Executive Officer

                                                     SUBSIDIARY
                                                     ----------

                                                     Pacific Biometrics, Inc.,
                                                     a Washington corporation

                                                     By:       /s/__________________________
                                                               Paul Kanan
                                                               Its:     Chief Executive

</TABLE>

                             Exhibit 10.32, Page 3<PAGE>

EXHIBIT 10.33 TO FORM 10-KSB PACIFIC BIOMETRICS, INC.  6/30/01

                              MANAGEMENT AGREEMENT
                              --------------------

                  This Management Agreement (the "Agreement") is entered into as
of September 15, 1999 by and between Saigene Corporation, a Delaware corporation
(hereinafter referred to as the "Manager") on the one hand, and Pacific
Biometrics, Inc., a Delaware corporation (hereinafter referred to as the
"Parent"), and Pacific Biometrics, Inc., a Washington corporation (hereinafter
referred to as the "Subsidiary"), on the other hand. Parent and Subsidiary are
sometimes hereinafter collectively referred to as the "Corporation."

                                    RECITALS:
                                    --------

                  WHEREAS, Manager and Corporation have signed a Letter of
Intent memorializing the intent of Manager to purchase substantially all of the
laboratory business and assets of the Subsidiary (the "Assets") and to assume
certain liabilities of the Corporation (the "Assumed Liabilities"). The parties
are in the process of conducting their due diligence, taking steps to satisfy
the conditions and contingencies in the Letter of Intent, and negotiating,
drafting and executing formal agreements regarding the sale of the Assets and
assumption of the Assumed Liabilities; and

                  WHEREAS, Manager and Corporation desire that the Manager
assume the control of the day-to-day operations of the Subsidiary pending the
closing on the purchase of Assets and the assumption of the Assumed Liabilities;

                  NOW, THEREFORE, in consideration of the mutual covenants,
agreements and promises contained in this Agreement, the receipt and adequacy of
which is hereby acknowledged, the parties agree as follows:

                                   AGREEMENT:
                                   ---------

                  1. TERM OF AGREEMENT; NOTICE OF TERMINATION. This agreement
shall commence on the date first indicated above and shall continue until the
earlier of the close of the purchase by the Manager of the Assets or until
written notice is given in the matter set forth in Section 7 below or on March
31, 2000.

                  2. MANAGEMENT SERVICES TO CORPORATION. Pursuant to this
Agreement, Manager agrees to be responsible for all aspects of the day-to-day
operations of the laboratory business of the Subsidiary, and absent a breach of
this Agreement by Corporation, will hold Corporation harmless from any and all
claims, demands, or liabilities on account thereof during the term of this
Agreement. Except for the Osteopatch inventory and SalivaSac inventory, which
may continue to be stored at the laboratory, after Ten (10) business days of the
Effective Date, Manager shall take physical custody and control of the
Subsidiary's laboratory premises in Washington and Corporation shall remove from
said premises all non-laboratory personnel and all property not to be sold to
Manager. While the results of the SalivaSac SBIR Grant shall be the intellectual
property of the Corporation, all revenue derived from the Grant shall be turned
over to Manager pursuant to the terms of this Agreement. Notwithstanding
Manager's receipt of these funds, Manager will have no rights to the SalivaSac
technology including intellectual property, manufacturing rights, product
applications or work product from the SBIR Grant. All raw material and other
supplies shall be purchased and all managers, supervisory personnel and
employee's of the

                             Exhibit 10.33, Page 1

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Subsidiary's laboratories business shall be compensated through Subsidiary,
but Manager may, in its sole and absolute discretion, provide working capital
to the Subsidiary in order to meet some or all of these and other operational
expenses of the Subsidiary's laboratory business.

                  Further, Manager agrees to maintain the total head count of
full time employees at the Seattle laboratory at a minimum of ten (10) full time
employees. In the event that the total head count falls below the minimum
required, Manager will have 30 days to bring total head count into compliance
with this section. Notwithstanding the foregoing, Manager will have full and
complete authority to, in its sole discretion, terminate any current employee of
the Subsidiary during the term of this agreement and Manager will have the full
and complete authority, in its sole discretion, to hire new full or part-time
employees for the Subsidiary.

                  3. NET CASH FLOW AND PROFIT. Cash flow generated by the
business during the term of this Agreement including, without limitation,
accounts receivable (except those subject to factoring by Silicon Valley Bank,
the payment of which shall be transmitted to the Bank), shall be routed directly
to Manager, and Manager shall use these fund to pay Corporation's laboratory
obligations. To the extend that Manager advances funds on behalf of Corporation,
such funds shall be used to reduce the purchase price for the Assets on a
dollar-for-dollar basis. To the extent the Subsidiary generates a positive cash
flow, such positive cash flow shall be paid to Manager as compensation for its
services hereunder. To the extent the Subsidiary generates a positive, and such
positive cash flow is paid to Manager as compensation for its services
hereunder, the purchase price for the Assets will increase on a
dollar-for-dollar basis in the amount of compensation paid to Manager. If Parent
does not close on the Asset purchase for any reason (including without
limitation, failing to receive shareholder approval) then Corporation sill be
obligated to repay all advance made by Manager. In such an event, Manager agrees
that the officers and directors of Corporation shall not have any personal
liability to repay the advances. Notwithstanding the foregoing, if Manager
terminates this Agreement or the Letter of Intent for any reason, then
Corporation will not be obligated to repay advance made by Manager under this
Agreement.

                  4. INSURANCE. Subsidiary will keep in force during the term of
this Agreement, for the benefit and protection of Manager and Corporation,
liability insurance, workers compensation insurance and such other insurance in
scope and amounts satisfactory to Manager. The cost of such insurance shall be
considered an operating cost of the laboratory business during the term of this
Agreement.

                  5. PROXY SOLICITATION. Manager agrees to make available some
or all of the administrative staff of Manager and subsidiary to assist in the
preparation of Parent's proxy solicitation to its shareholders for the approval
of the transaction contemplated by the parties Letter of Intent. Manager also
agrees to provide its legal counsel to prepare a form of Proxy Solicitation, and
to advance actual printing and mailing costs associated with the Proxy
Solicitation. The meeting of Parent's Shareholders to approve the transaction
shall take place at Subsidiary's office in Seattle, Washington. Manager and its
employees, agents and legal counsel shall be held harmless for its role in the
preparation, printing, mailing and all other aspects of assisting Parent with
its Proxy Solicitation.

                  In the alternative, if at the end of any calendar month during
the term of this agreement, the laboratory operations of subsidiary result in a
cumulative Positive Cash Flow (as defined in this section), Manager agrees to
provide Parent with fifty percent (50%) of the Positive Cash Flow to apply
towards costs of the Proxy Solicitation.

                  For purposes of this section 5 only, the term "Positive Cash
Flow" means cash flow in excess of net monthly operating expenses after all
operating expenses and accounts payable for the laboratory have been brought to
no more than thirty days outstanding. For example, as of August 12,

                             Exhibit 10.33, Page 2

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1999, approximately $13,000 in accounts payable for the laboratory were sixty
days in arrears and approximately $76,000 in accounts payable were more than
ninety days in arrears. Both of these numbers must be reduced to zero in order
for there to be Positive Cash Flow for the purposes of this section 5.

                  6. SECURITY INTEREST. Parent and Subsidiary hereby grant
Manager a security interest in all of their assets, tangible or intangible,
including, without limitation, laboratory equipment, accounts receivable, cash,
contracts, purchase orders and work in progress, subject to existing senior
security interests and/or liens to secure Manager's right to full and timely
payment of Manager's loans and advances, or other expenditures on its behalf of
Parent (such as cost advanced on behalf of Parent for its Proxy Solicitation) or
Subsidiary to the Corporation and costs paid on behalf. Parent and Subsidiary
further grant Manager the right to record a financing statement and/or to take
any other measures reasonably necessary to perfect Manager's security interest.

                  7. TERMINATION. Either party may terminate this Agreement at
any time and for any reason, or no reason, immediately upon giving written
notice to the Corporation. Notwithstanding the foregoing, Corporation may
terminate this Agreement if, and only if, Corporation reimburse Manager for (i)
all monetary obligations incurred by Manager on behalf of the Corporation under
this Agreement, and (ii) all capital invested in or paid on behalf of
Corporation by Manager under this Agreement, prior to giving Manager written
notice of termination. Notice shall be given in a matter set forth in Section
8.2 below. If Corporation gives notice of termination to Manager before paying
Manager all amounts due pursuant to this Section, the notice shall not be deemed
effective until such time as the Corporation has delivered full payment to
Manager.

                  Notwithstanding the above, unless extended in writing by the
parties, this Agreement shall end on March 31, 2000. Upon termination by
Corporation, Corporation will reimburse Manager for all monetary obligations
incurred by Manager on behalf of the Corporation under this Agreement, and all
funds advanced in or paid on behalf of Corporation by Manager under this
Agreement. If Corporation is unable to reimburse all or some portion of the
amount due Manager as a result of insolvency or bankruptcy, Manager will become
a secured creditor of Corporation for the unpaid amounts, provided, however,
that the Corporation continues to operate or files a voluntary petition for
bankruptcy. In the event that Corporation is forced into bankruptcy through the
filing of an involuntary petition for bankruptcy by Corporation's creditors, and
Corporation's creditors obtain a valid order from the bankruptcy court
invalidating or terminating this Agreement, then Corporation shall not be
obligated to reimburse Manager for monetary obligations incurred by Manager on
behalf of Corporation under this Agreement.

        8.   GENERAL PROVISIONS.
             ------------------

                  8.1 INTEGRATION: MODIFICATION: WAIVER. This Agreement
constitutes and contains the entire agreement and understanding concerning the
subject matter between the parties, sets forth all inducements made by any party
to any other party with respect to any of the subject matter, and supercedes and
replaces all prior and contemporaneous negations, proposed agreements or
agreements, whether written or oral. Each of the parties acknowledges to each of
the other parties that no other party nor any agent or attorney of any other
party has made any promise, representation or warranty whatsoever express or
implied, written or oral, not contained herein concerning the subject matter
hereof to induce it to execute this Agreement, and each of the parties
acknowledges that is has not executed this Agreement in reliance on any promise,
representation or warranty not contained herein. No supplement, modification, or
amendment of this Agreement shall be binding unless executed in writing by all
parties.

                  8.2 NOTICES. All notices, requests, demands, and other
communications required or permitted under this Agreement shall be in writing
and shall be deemed to have been duly given (i) on the

                             Exhibit 10.33, Page 3

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date of service, if served personally on the party to whom notice is given; (ii)
on the fifth day after mailing, if mailed to the party to whom notice is to be
given, by first class mail, registered or certified, postage prepaid; or (iii)
One (1) business day after (a) deposit with a nationally recognized overnight
courier, or (b) transmission by telecopy or similar means, if a copy of the
notice is also sent via first class mail, registered or certified, postage
prepaid or by overnight courier, provided that a transmission report is
generated reflecting the accurate transmission of the notice. All notices,
requests, demands, and other communications must be addressed as follows:

                  To Manager at:

                           Mr. Ronald R. Helm
                           Chief Executive Officer
                           Saigene Corporation
                           7126 180th Avenue NE
                           Suite C104
                           Redmond, Washington 98052
                           Fax:  (425) 885-1443

                  To Corporation at:

                           Mr. Paul Kanan
                           President
                           Pacific Biometrics, Inc.
                           23120 Alicia Parkway, Suite 200
                           Mission Viejo, CA  92692
                           Fax: (949) 588-2788

                  8.3 GOVERNING LAW. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of California,
without giving effect to its conflict of laws provisions.

                  8.4 NO JOINT VENTURE. The parties have and independent
contractor relationship and nothing contained herein shall be deemed to create a
joint venture or partnership or agency relationship between Corporation and
Manager. Neither party shall have the right or authority to, and each party
shall not, assume or create any obligations or responsibility, express or
implied, on behalf of or in the name of the other party or bind the other party
in any manner. Nothing set forth herein shall be deemed to confer upon any
person or entity other than the parties hereto a right of action either under
this Agreement or in any manner whatsoever.

                  8.5 SEVERABILITY. In the event that any provision of this
Agreement is deemed invalid, illegal, or unenforceable, all other provisions of
the Agreement which are not affected by such invalidity, illegality or
unenforceability, shall remain in full force and effect. Further, the parties
hereby agree that if any such provision is deemed invalid, illegal or
unenforceable, that provision shall be limited or eliminated in scope, power or
effect to the minimum extent necessary so that this Agreement shall otherwise
remain in full force and effect and enforceable.

                  8.6 ATTORNEY'S FEES. The prevailing party in any action or
proceeding between Corporation and Manager arising out of or related to this
Agreement shall be entitled to recover from the

                             Exhibit 10.33, Page 4

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other party all of its costs and expenses including, without limitation, its
reasonable attorney's fees incurred in connections with such action, including
any appeal of such action.

                  8.7 HEADINGS. The subject headings of the sections and
subsections of this Agreement are included for purpose of convenience only, and
shall not affect the construction or interpretation of any of its provisions.

                  8.8 COUNTERPARTS; FACSIMILE SIGNATURES. This Agreement may be
executed in one or more counterparts, using facsimile signatures, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.

                  8.9 INTERPRETATION. In the event of any ambiguity in the
interpretation of this Agreement, the interpretation of this Agreement shall not
be resolved by any rule of interpretation providing for interpretation against
the party who cause the uncertainty to exist or against the draftsman.

                  8.10 AUTHORITY. The undersigned individuals execute this
Agreement on behalf of the respective parties, and represent that they are
authorized to enter into and execute this Agreement on behalf of such parties.

                  8.11 FURTHER ASSURANCES. The parties agree to execute all
instruments and documents of further assurances and will do any and all such
acts as may be reasonably required to carry out their obligations and to
consummate the transactions contemplated.

                  8.12 BINDING EFFECT. This Agreement is binding upon and shall
inure to the benefit of the parties and each of the party's respective heirs,
executors, administrators, successors and assigns.

                  8.13 NO IMPLIED WAIVER. No action or failure to act shall
constitute a waiver of any right or duty under this Agreement, nor shall any
action or failure to act constitute an approval of, or acquiescence in, any
breach. Waiver of any one provision herein shall not be deemed to be a
continuing waiver nor a waiver of any other provision herein.

                  IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date indicated above.

                                 MANAGER
                                 Saigene Corporation, a Delaware Corporation

                                 By:      /s/_______________________________
                                          Ronald R. Helm

                                 Its:     Chief Executive Officer

                             Exhibit 10.33, Page 5
<PAGE>

                             PARENT
                             Pacific Biometrics, Inc., a Delaware Corporation

                             By:      /s/__________________________________
                                      Paul Kanan

                             Its:     Chief Executive Officer

                             SUBSIDIARY
                             Pacific Biometrics, Inc., a Washington Corporation

                             By:      /s/__________________________________
                                      Paul Kanan

                             Its:     Chief Executive Officer

                             By:      _____________________________________
                                      Terry Giles

                             Its:     Chief Executive Officer

                             Exhibit 10.33, Page 6

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