Document:

Form of Director and Executive Officer Indemnification Agreement

 Exhibit 10.1 

 

 

 PACIFIC BIOSCIENCES OF CALIFORNIA, INC. 

INDEMNIFICATION AGREEMENT 

THIS AGREEMENT is entered into, effective as of             ,
20     by and between Pacific Biosciences of California, Inc., a Delaware corporation (the “Company”), and
                     (“Indemnitee”). 

WHEREAS, it is essential to the Company to retain and attract as directors and officers the most capable persons available; 

WHEREAS, Indemnitee is a director and/or officer of the Company; 

WHEREAS, both the Company and Indemnitee recognize the increased risk of litigation and other claims currently being asserted against
directors and officers of corporations; 
 WHEREAS, the Certificate of Incorporation permits and Bylaws of the Company require
the Company to indemnify and advance expenses to its directors and officers to the fullest extent permitted under Delaware law, and the Indemnitee has been serving and continues to serve as a director and/or officer of the Company in part in
reliance on the Company’s Certificate of Incorporation and Bylaws; 
 WHEREAS, in recognition of Indemnitee’s need for
substantial protection against personal liability in order to enhance the Indemnitee’s continued and effective service to the Company and, specific contractual assurance that the protection promised by the Certificate of Incorporation and
Bylaws will be available to Indemnitee (regardless of, among other things, any amendment to or revocation of the Certificate of Incorporation and Bylaws or any change in the composition of the Company’s Board of Directors or acquisition
transaction relating to the Company), and in order to induce Indemnitee to provide effective services to the Company as a director and/or officer, the Company wishes to provide in this Agreement for the indemnification of and the advancing of
expenses to Indemnitee to the fullest extent (whether partial or complete) permitted under Delaware law and as set forth in this Agreement, and, to the extent insurance is maintained which includes Indemnitee as a covered party, to provide for the
continued coverage of Indemnitee under the Company’s directors’ and officers’ liability insurance policies; and 

WHEREAS, to the extent Indemnitee is serving as a director on the Company’s Board of Directors at the request or direction of a
venture capital fund or other entity and/or certain of its affiliates (collectively, the “Fund Indemnitors”), Indemnitee may have certain rights to indemnification, advancement of expenses and/or insurance provided by or with respect to
the Fund Indemnitors, which Indemnitee, the Company and the Fund Indemnitors intend to be secondary to the primary obligation of the Company to indemnify Indemnitee as provided herein, with the Company’s acknowledgement of and agreement to the
foregoing being a material condition to Indemnitee’s willingness to serve as a director of the Company. 

 

 

  

 NOW, THEREFORE, in consideration of the above premises and of Indemnitee continuing to
serve the Company directly or, at its request, with another enterprise, and intending to be legally bound hereby, the parties agree as follows: 

1. Certain Definitions. 

(a) “Board” shall mean the Board of Directors of the Company. 

(b) “Change in Control” shall be deemed to have occurred if (i) any “person” (as
such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company or
a corporation owned directly or indirectly by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Company representing 50% or more of the total voting power represented by the Company’s then outstanding Voting Securities, or (ii) during any period of two consecutive years,
individuals who at the beginning of such period constitute the Board and any new director whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds
( 2/3) of the directors then still in office
who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority of the Board, or (iii) the stockholders of the Company approve a
merger or consolidation of the Company with any other entity, other than a merger or consolidation that would result in the Voting Securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into Voting Securities of the surviving entity) at least 80% of the total voting power represented by the Voting Securities of the Company or such surviving entity outstanding immediately after such merger or
consolidation, or (iv) the stockholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company (in one transaction or a series of transactions) of all or substantially all
of the Company’s assets. 
 (c) “Expenses” shall mean any expense, liability, or loss,
including attorneys’ fees, judgments, fines, ERISA excise taxes and penalties, amounts paid or to be paid in settlement, any interest, assessments, or other charges imposed thereon, any federal, state, local, or foreign taxes imposed as a
result of the actual or deemed receipt of any payments under this Agreement, and all other costs and obligations, paid or incurred in connection with investigating, defending, being a witness in, participating in (including on appeal), or preparing
for any of the foregoing in, any Proceeding relating to any Indemnifiable Event. 
 (d) “Indemnifiable Event”
shall mean any event or occurrence that takes place either prior to or after the execution of this Agreement, related to the fact that Indemnitee is or was a director or officer of the Company, or while a director or officer is or was serving at the
request of the Company as a director, officer, employee, trustee, agent, or fiduciary of a subsidiary of the Company or of any other foreign or domestic corporation, partnership, joint venture, employee benefit plan, trust, or other enterprise, or
was a director, officer, employee, or agent of a 
  

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foreign or domestic corporation that was a predecessor corporation of the Company or of another enterprise at the request of such predecessor corporation, or related to anything done or not done
by Indemnitee in any such capacity, whether or not the basis of the Proceeding is alleged action in an official capacity as a director, officer, employee, or agent or in any other capacity while serving as a director, officer, employee, or agent of
the Company, as described above. 
 (e) “Independent Counsel” shall mean counsel selected by Indemnitee and
approved by the Company (which approval shall not be unreasonably withheld), and who has not otherwise performed services for the Company or the Indemnitee (other than in connection with indemnification matters) within the last three years.

 (f) “Proceeding” shall mean any threatened, pending, or completed action, suit, or proceeding or any
alternative dispute resolution mechanism (including an action by or in the right of the Company), or any inquiry, hearing, or investigation, whether conducted by the Company or any other party, that Indemnitee in good faith believes might lead to
the institution of any such action, suit, or proceeding, whether civil, criminal, administrative, investigative, or other. 

(g) “Voting Securities” shall mean any securities of the Company that vote generally in the election of directors.

 2. Agreement to Indemnify. 

(a) General Agreement. In the event Indemnitee was, is, or becomes a party to or witness or other participant in, or is
threatened to be made a party to or witness or other participant in, a Proceeding by reason of (or arising in part out of) an Indemnifiable Event, the Company shall indemnify Indemnitee from and against any and all Expenses to the fullest extent
permitted by law, as the same exists or may hereafter be amended or interpreted. The parties hereto intend that this Agreement shall provide for indemnification in excess of that expressly permitted by statute, including, without limitation, any
indemnification provided by the Company’s Certificate of Incorporation, its Bylaws, vote of its stockholders or disinterested directors, or applicable law. The only limitation that shall exist upon the Company’s obligations pursuant to
this Section 2 shall be that the Company shall not be obligated to make any payment to Indemnitee that is finally determined by a court of competent jurisdiction in a final judgment, not subject to appeal, to be unlawful. 

(b) Initiation of Proceeding. Notwithstanding anything in this Agreement to the contrary, Indemnitee shall not be entitled
to indemnification pursuant to this Agreement in connection with any Proceeding or part thereof initiated by Indemnitee against the Company or any director or officer of the Company unless (i) the Company has joined in or the Board has
consented to the initiation of such Proceeding or part thereof; (ii) the Proceeding or part thereof is one to enforce indemnification rights under Section 4; or (iii) the Proceeding or part thereof is instituted after a Change in
Control (other than a Change in Control approved by a majority of the directors on the Board who were directors immediately prior to such Change in Control) and Independent Counsel has approved its initiation. 

 

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 (c) Expense Advances. If so requested by Indemnitee, the Company shall
advance (within thirty business days of such request) any and all Expenses incurred by Indemnitee (an “Expense Advance”). The Indemnitee shall qualify for such Expense Advances upon the execution and delivery to the Company of this
Agreement which shall constitute an undertaking providing that the Indemnitee undertakes to repay such Expense Advances if and to the extent that it is ultimately determined by a court of competent jurisdiction in a final judgment, not subject to
appeal, that Indemnitee is not entitled to be indemnified by the Company. Until it is so finally determined by the court that Indemnitee is not entitled indemnification, Indemnitee shall not be required to repay such Expense Advances to the Company
and Indemnitee shall continue to receive Expense Advances pursuant to this Section 2(c). Indemnitee’s obligation to reimburse the Company for Expense Advances shall be unsecured and no interest shall be charged thereon. To the extent
permissible under third party policies, the Company agrees that invoices for Expense Advances shall be billed in the name of and be payable directly by the Company. 

(d) Mandatory Indemnification. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee has been
successful on the merits or otherwise in defense of any Proceeding relating in whole or in part to an Indemnifiable Event or in defense of any issue or matter therein, Indemnitee shall be indemnified against all Expenses incurred in connection
therewith. 
 (e) Partial Indemnification. If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Company for some or a portion of Expenses, but not, however, for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion thereof to which Indemnitee is entitled. Attorneys’ fees and
expenses shall not be prorated but shall be deemed to apply to the portion of indemnification to which Indemnitee is entitled. 

(f) Prohibited Indemnification. No indemnification pursuant to this Agreement shall be paid by the Company on account of any
Proceeding in which judgment is rendered against Indemnitee for an accounting of profits made from the purchase or sale by Indemnitee of securities of the Company pursuant to the provisions of Section 16(b) of the Exchange Act, or similar
provisions of any federal, state, or local laws. 
 3. Indemnification Process and Appeal. 

(a) Indemnification Payment. Indemnitee shall be entitled to indemnification of Expenses, and shall receive payment thereof,
from the Company in accordance with this Agreement as soon as practicable after Indemnitee has made written demand on the Company for indemnification, unless indemnification of such Expenses is prohibited under Section 2(f) of this Agreement.

 (b) Suit to Enforce Rights. If Indemnitee has not received full advancement within thirty (30) days or full
indemnification within ninety (90) days after making a demand in accordance with Section 3(a), Indemnitee shall have the right to enforce its indemnification rights under this Agreement by commencing litigation in the Court of Chancery of
the State of Delaware seeking an initial determination by the court or challenging any determination by the Company or any aspect thereof. The Company hereby consents to service of process and to appear in any such proceeding. The remedy provided
for in this Section 3 shall be in addition to any other remedies 
  

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available to Indemnitee at law or in equity. The Company shall be precluded from asserting in any judicial proceeding commenced pursuant to this Section 3(b) that the procedures and
presumptions of this Agreement are not valid, binding and enforceable and shall stipulate that the Company is bound by all the provisions of this Agreement. 

(c) Defense to Indemnification, Burden of Proof, and Presumptions. It shall be a defense to any action brought by Indemnitee
against the Company to enforce this Agreement (other than an action brought to enforce a claim for Expenses incurred in defending a Proceeding in advance of its final disposition) that it is not permissible under applicable law for the Company to
indemnify Indemnitee for the amount claimed. In connection with any such action to whether Indemnitee is entitled to be indemnified hereunder, the burden of proving such a defense or determination shall be on the Company to establish by clear and
convincing evidence that Indemnitee is not so entitled to indemnification. It is the parties’ intention that if Indemnitee commences legal proceedings to secure a judicial determination that Indemnitee should be indemnified under this Agreement
or applicable law, the question of Indemnitee’s right to indemnification shall be for the court to decide, as a de novo trial on the merits. 

(d) To the maximum extent permitted by applicable law in making a determination with respect to entitlement to indemnification (or
advancement of expenses) hereunder, the Company shall presume that Indemnitee is entitled to indemnification (or advancement of expenses) under this Agreement if Indemnitee has submitted a request for advancement under Section 2(c) of this
Agreement for indemnification in accordance with Section 3(a) of this Agreement, and the Company shall have the burden of proof to overcome that assumption by clear and convincing evidence in connection with the making of any determination
contrary to that presumption. 
 (e) The Company acknowledges that a settlement or other disposition of a Proceeding short of
final judgment may constitute success by Indemnitee if it permits a party to avoid expense, delay, distraction, disruption and uncertainty. In the event that any Proceeding to which Indemnitee is a party is resolved in any manner other than by
adverse judgment against Indemnitee (including, without limitation, settlement of such Proceeding without payment of money or other consideration) it shall be presumed (unless there is clear and convincing evidence to the contrary) that Indemnitee
has been successful on the merits or otherwise in such Proceeding. Anyone seeking to overcome this presumption shall have the burden of proof and the burden of persuasion, by clear and convincing evidence. 

4. Indemnification for Expenses Incurred in Enforcing Rights. The Company shall indemnify Indemnitee against any and all
Expenses that are incurred by Indemnitee in connection with any action brought by Indemnitee for 
 (a) indemnification or
advance payment of Expenses by the Company under this Agreement or any other agreement or under applicable law or the Company’s Certificate of Incorporation or Bylaws now or hereafter in effect relating to indemnification for Indemnifiable
Events, and/or 
  

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 (b) recovery under directors’ and officers’ liability insurance policies
maintained by the Company, but only in the event that Indemnitee ultimately is determined to be entitled to such indemnification or insurance recovery, as the case may be. 

In addition, the Company shall, if so requested by Indemnitee, advance the foregoing Expenses to Indemnitee, subject to and in accordance with
Section 2(c). 
 5. Notification and Defense of Proceeding. 

(a) Notice. Promptly after receipt by Indemnitee of notice of the commencement of any Proceeding, Indemnitee shall, if a
claim in respect thereof is to be made against the Company under this Agreement, notify the Company of the commencement thereof; but the omission so to notify the Company will not relieve the Company from any liability that it may have to
Indemnitee, except as provided in Section 5(c). 
 (b) Defense. With respect to any Proceeding as to which
Indemnitee notifies the Company of the commencement thereof, the Company will be entitled to participate in the Proceeding at its own expense and except as otherwise provided below, to the extent the Company so wishes, it may assume the defense
thereof with counsel reasonably satisfactory to Indemnitee. After notice from the Company to Indemnitee of its election to assume the defense of any Proceeding, the Company shall not be liable to Indemnitee under this Agreement or otherwise for any
Expenses subsequently incurred by Indemnitee in connection with the defense of such Proceeding other than reasonable costs of investigation, transition costs associated with the Company’s assumption of the defense, or as otherwise provided
below. Indemnitee shall have the right to employ legal counsel in such Proceeding, but all Expenses related thereto incurred after notice from the Company of its assumption of the defense shall be at Indemnitee’s expense unless: (i) the
employment of legal counsel by Indemnitee has been authorized by the Company, (ii) Indemnitee has reasonably determined that there may be a conflict of interest between Indemnitee and the Company in the defense of the Proceeding,
(iii) after a Change in Control (other than a Change in Control approved by a majority of the directors on the Board who were directors immediately prior to such Change in Control), the employment of counsel by Indemnitee that has been approved
by Independent Counsel, or (iv) the Company shall not in fact have employed counsel to assume the defense of such Proceeding, in each of which cases all Expenses of the Proceeding shall be borne by the Company. The Company shall not be entitled
to assume the defense of any Proceeding brought by or on behalf of the Company or as to which Indemnitee shall have made the determination provided for in (ii), (iii) and (iv) above. 

(c) Settlement of Claims. The Company shall not be liable to indemnify Indemnitee under this Agreement or otherwise for any
amounts paid in settlement of any Proceeding effected without the Company’s written consent, such consent not to be unreasonably withheld; provided, however, that if a Change in Control has occurred (other than a Change in Control approved by a
majority of the directors on the Board who were directors immediately prior to such Change in Control), the Company shall be liable for indemnification of Indemnitee for amounts paid in settlement if the Independent Counsel has approved the
settlement. The Company shall not settle any Proceeding in any manner that would impose any penalty or limitation on Indemnitee without Indemnitee’s prior written consent. The Company shall promptly notify Indemnitee once the Company has
received an offer or intends to make an offer to settle any such Proceeding and the Company shall 
  

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provide Indemnitee as much time as reasonably practicable to consider such offer; provided, however Indemnitee shall have no less than three (3) business days to consider the offer. The
Company shall not be liable to indemnify the Indemnitee under this Agreement with regard to any judicial award if the Company was not given a reasonable and timely opportunity, at its expense, to participate in the defense of such action; the
Company’s liability hereunder shall not be excused if participation in the Proceeding by the Company was barred by this Agreement. 

6. Non-Exclusivity. Except with regard to the Company’s primary obligations, as set forth in Section 10 hereof, the
rights of Indemnitee hereunder shall be in addition to any other rights Indemnitee may have under the Company’s Certificate of Incorporation, Bylaws, applicable law, or otherwise; provided, however, that this Agreement shall supersede any prior
indemnification agreement between the Company and the Indemnitee. To the extent that a change in applicable law (whether by statute or judicial decision) permits greater indemnification than would be afforded currently under the Company’s
Certificate of Incorporation, Bylaws, applicable law, or this Agreement, it is the intent of the parties that Indemnitee enjoy by this Agreement the greater benefits so afforded by such change without any further action by the parties hereto.

 7. Liability Insurance.

(a) The Company hereby covenants and agrees that, so long as the Indemnitee shall continue to serve as an agent of the Company and
thereafter so long as the Indemnitee shall be subject to any possible proceeding by reason of the fact that the Indemnitee was an agent of the Company, the Company, subject to Section 7(b), shall use reasonable efforts to obtain and maintain in
full force and effect directors’ and officers’ liability insurance (“D&O Insurance”) in reasonable amounts from established and reputable insurers and Indemnitee shall be a covered party under such insurance to the
maximum extent of the coverage available for any director or officer of the Company. 
 (b) Notwithstanding the foregoing, the
Company shall have no obligation to obtain or maintain D&O Insurance if the Company determines in good faith that such insurance is not reasonably available, the premium costs for such insurance are disproportionate to the amount of coverage
provided, or the coverage is reduced by exclusions so as to provide an insufficient benefit. 
 8. Amendment of this
Agreement. No supplement, modification, or amendment of this Agreement shall be binding unless executed in writing by both of the parties hereto. No waiver of any of the provisions of this Agreement shall be binding unless in the form of a
writing signed by the party against whom enforcement of the waiver is sought, and no such waiver shall operate as a waiver of any other provisions hereof (whether or not similar), nor shall such waiver constitute a continuing waiver. Except as
specifically provided herein, no failure to exercise or any delay in exercising any right or remedy hereunder shall constitute a waiver thereof. 

9. Subrogation. Except with regard to the Company’s primary obligations, as set forth in Section 10 hereof, in the
event of payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee, who shall execute all papers required and shall do everything that may be necessary to secure such
rights, including the execution of such documents necessary to enable the Company effectively to bring suit to enforce such rights. 
  

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 10. No Duplication of Payments. The Company shall not be liable under this
Agreement to make any payment in connection with any claim made against Indemnitee to the extent Indemnitee has otherwise received payment (under any insurance policy, Bylaw, or otherwise) of the amounts otherwise indemnifiable hereunder; provided,
however, that (a) the Company hereby agrees that its obligations to Indemnitee under this Agreement or any other agreement or undertaking to provide advancement, indemnification or both to Indemnitee are primary, and any obligation of the Fund
Indemnitors to provide advancement or indemnification for the any Expenses, judgments, fines and amounts paid in settlement (including all interest, assessments and other charges paid or payable in connection with or in respect of such Expenses,
judgments, fines and amounts paid in settlement) incurred by Indemnitee are secondary, and (b) if the Fund Indemnitors pays or causes to be paid, for any reason, any amounts otherwise indemnifiable hereunder or under any other indemnification
agreement with Indemnitee (whether pursuant to the Bylaws or Certificate or another contract), then (i) the Fund Indemnitors shall be fully subrogated to all rights of Indemnitee with respect to such payment and (ii) the Company shall
fully indemnify, reimburse and hold harmless the Fund Indemnitors for all such payments actually made by the Fund Indemnitors. In addition, the Company hereby unconditionally and irrevocably waives, relinquishes, releases, and covenants and agrees
not to exercise, any rights that the Company may now have or hereafter acquires against the Fund Indemnitors or Indemnitee that arise from or relate to contribution, subrogation or any other recovery of any kind under this Agreement or any other
indemnification agreement (whether pursuant to the Bylaws or Certificate or another contract). The Company and Indemnitee hereby agree that this Section 10 shall be deemed exclusive and shall be deemed to modify, amend and clarify any right to
indemnification or advancement provided to Indemnitee under any other contract, agreement or document with the Company. 
 11.
Binding Effect. This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral, written and implied, between the parties
hereto with respect to the subject matter hereof. This Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and their respective successors (including any direct or indirect successor by purchase,
merger, consolidation, or otherwise to all or substantially all of the business and/or assets of the Company), assigns, spouses, heirs, and personal and legal representatives. The indemnification provided under this Agreement shall continue as to
Indemnitee for any action taken or not taken while serving in an indemnified capacity pertaining to an Indemnifiable Event even though he may have ceased to serve in such capacity at the time of any Proceeding. 

12. Severability. If any provision (or portion thereof) of this Agreement shall be held by a court of competent jurisdiction
to be invalid, void, or otherwise unenforceable, the remaining provisions shall remain enforceable to the fullest extent permitted by law. Furthermore, to the fullest extent possible, the provisions of this Agreement (including, without limitation,
each portion of this Agreement containing any provision held to be invalid, void, or otherwise unenforceable, that is not itself invalid, void, or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held
invalid, void, or unenforceable. 
  

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 13. Third-Party Beneficiary. The Fund Indemnitors and Independent Counsel are
express third-party beneficiaries of this Agreement, and may specifically enforce the Company’s obligations hereunder (including, but not limited to, the obligations specified in Section 10 hereof) as though a party hereunder. 

14. Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of
Delaware applicable to contracts made and to be performed in such State without giving effect to its principles of conflicts of laws. 

15. Consent to Jurisdiction. The Company and Indemnitee hereby irrevocably (i) agree that any action or proceeding
arising out of or in connection with this Agreement shall be brought only in the Chancery Court of the State of Delaware (the “Chancery Court”), (ii) consent to submit to the exclusive jurisdiction of the Chancery Court for
purposes of any action or proceeding arising out of or in connection with this Agreement, and (iii) waive any objection to the venue of any such action or proceeding in the Chancery Court. 

16. Notices. All notices, demands and other communications required or permitted hereunder shall be made in writing and shall be
deemed to have been duly given if delivered by hand, against receipt or mailed, postage prepaid, certified or registered mail, return receipt requested and addressed to the Company at: 

Pacific Biosciences of California, Inc. 

1505 Adams Drive 

Menlo Park, California 94025 

Attention: Chief Executive Officer 

and to Indemnitee at the address set forth below Indemnitee’s signature hereto. Notice of change of address shall be effective only when given in
accordance with this Section. All notices complying with this Section shall be deemed to have been received on the date of hand delivery or on the third business day after mailing. 

17. Counterparts. This Agreement may be executed in one or more 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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 IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this Agreement as of
the day specified above. 
  

			
	 PACIFIC BIOSCIENCES OF CALIFORNIA, INC.

a Delaware corporation

		
	By:	 	  

	Name:	 	  

	Title:	 	  

	
	 INDEMNITEE,

an individual

	  

	 Indemnitee

		
	 Address:2004 Equity Incentive Plan and forms of option agreements thereunder

 EXHIBIT 10.2 

PACIFIC BIOSCIENCES OF CALIFORNIA, INC. 

2004 EQUITY INCENTIVE PLAN 

ADOPTED: MARCH 4, 2004 

APPROVED BY STOCKHOLDERS: MARCH 4, 2004 

AS AMENDED THROUGH AUGUST 12, 2010 

 

	 	1.	PURPOSES. 

(a) Eligible Stock Award Recipients. The persons eligible to receive Stock Awards are Employees, Directors and Consultants.

 (b) Available Stock Awards. The purpose of the Plan is to provide a means by which eligible recipients of Stock Awards
may be given an opportunity to benefit from increases in value of the Common Stock through the granting of the following Stock Awards: (i) Incentive Stock Options, (ii) Nonstatutory Stock Options, (iii) stock bonuses and
(iv) rights to acquire restricted stock. 
 (c) General Purpose. The Company, by means of the Plan, seeks to retain
the services of the group of persons eligible to receive Stock Awards, to secure and retain the services of new members of this group and to provide incentives for such persons to exert maximum efforts for the success of the Company and its
Affiliates. 
  

	 	2.	DEFINITIONS. 

(a) “Affiliate” means any parent corporation or subsidiary corporation of the Company, whether now or
hereafter existing, as those terms are defined in Sections 424(e) and (f), respectively, of the Code. 
 (b)
“Board” means the Board of Directors of the Company. 
 (c) “Capitalization
Adjustment” has the meaning ascribed to that term in Section 11(a). 
 (d) “Change in
Control” means the occurrence, in a single transaction or in a series of related transactions, of any one or more of the following events: 

(i) any Exchange Act Person becomes the Owner, directly or indirectly, of securities of the Company representing more than fifty
percent (50%) of the combined voting power of the Company’s then outstanding securities other than by virtue of a merger, consolidation or similar transaction. Notwithstanding the foregoing, a Change in Control shall not be deemed to occur
(A) on account of the acquisition of securities of the Company by any institutional investor, 

 
any affiliate thereof or any other Exchange Act Person that acquires the Company’s securities in a transaction or series of related transactions that are primarily a private financing
transaction for the Company or (B) solely because the level of Ownership held by any Exchange Act Person (the “Subject Person”) exceeds the designated percentage threshold of the outstanding voting securities as a result of a
repurchase or other acquisition of voting securities by the Company reducing the number of shares outstanding, provided that if a Change in Control would occur (but for the operation of this sentence) as a result of the acquisition of voting
securities by the Company, and after such share acquisition, the Subject Person becomes the Owner of any additional voting securities that, assuming the repurchase or other acquisition had not occurred, increases the percentage of the then
outstanding voting securities Owned by the Subject Person over the designated percentage threshold, then a Change in Control shall be deemed to occur; 

(ii) there is consummated a merger, consolidation or similar transaction involving (directly or indirectly) the Company if,
immediately after the consummation of such merger, consolidation or similar transaction, the stockholders of the Company immediately prior thereto do not Own, directly or indirectly, either (A) outstanding voting securities representing more
than fifty percent (50%) of the combined outstanding voting power of the surviving Entity in such merger, consolidation or similar transaction or (B) more than fifty percent (50%) of the combined outstanding voting power of the parent
of the surviving Entity in such merger, consolidation or similar transaction; or 
 (iii) there is consummated a sale,
lease, license or other disposition of all or substantially all of the consolidated assets of the Company and its Subsidiaries, other than a sale, lease, license or other disposition of all or substantially all of the consolidated assets of the
Company and its Subsidiaries to an Entity, more than fifty percent (50%) of the combined voting power of the voting securities of which are Owned by stockholders of the Company in substantially the same proportion as their Ownership of the
Company immediately prior to such sale, lease, license or other disposition. 
 The term Change in Control shall not include a
sale of assets, merger or other transaction effected exclusively for the purpose of changing the domicile of the Company. 

Notwithstanding the foregoing or any other provision of this Plan, the definition of Change in Control (or any analogous term) in an
individual written agreement between the Company or any Affiliate and the Participant shall supersede the foregoing definition with respect to Stock Awards subject to such agreement (it being understood, however, that if no definition of Change in
Control or any analogous term is set forth in such an individual written agreement, the foregoing definition shall apply). 

(e) “Code” means the Internal Revenue Code of 1986, as amended. 

(f) “Committee” means a committee of one or more members of the Board appointed by the Board in accordance
with Section 3(c). 
 (g) “Common Stock” means the common stock of the Company. 

(h) “Company” means Pacific Biosciences of California, Inc., a Delaware corporation. 

 

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 (i) “Consultant” means any person, including an advisor,
(i) engaged by the Company or an Affiliate to render consulting or advisory services and who is compensated for such services or (ii) serving as a member of the Board of Directors of an Affiliate and who is compensated for such services.
However, the term “Consultant” shall not include Directors who are not compensated by the Company for their services as Directors, and the payment of a director’s fee by the Company for services as a Director shall not cause a
Director to be considered a “Consultant” for purposes of the Plan. 
 (j) “Continuous
Service” means that the Participant’s service with the Company or an Affiliate, whether as an Employee, Director or Consultant, is not interrupted or terminated. A change in the capacity in which the Participant renders service to
the Company or an Affiliate as an Employee, Consultant or Director or a change in the entity for which the Participant renders such service, provided that there is no interruption or termination of the Participant’s service with the Company or
an Affiliate, shall not terminate a Participant’s Continuous Service. For example, a change in status from an employee of the Company to a consultant to an Affiliate or to a Director shall not constitute an interruption of Continuous Service.
The Board or the chief executive officer of the Company, in that party’s sole discretion, may determine whether Continuous Service shall be considered interrupted in the case of any leave of absence approved by that party, including sick leave,
military leave or any other personal leave. Notwithstanding the foregoing, a leave of absence shall be treated as Continuous Service for purposes of vesting in a Stock Award only to such extent as may be provided in the Company’s leave of
absence policy or in the written terms of the Participant’s leave of absence. 
 (k) “Corporate
Transaction” means the occurrence, in a single transaction or in a series of related transactions, of any one or more of the following events: 

(i) a sale or other disposition of all or substantially all, as determined by the Board in its discretion, of the consolidated
assets of the Company and its Subsidiaries; 
 (ii) a sale or other disposition of at least fifty percent (50%) of
the outstanding securities of the Company; 
 (iii) a merger, consolidation or similar transaction following which the
Company is not the surviving corporation; or 
 (iv) a merger, consolidation or similar transaction following which the
Company is the surviving corporation but the shares of Common Stock outstanding immediately preceding the merger, consolidation or similar transaction are converted or exchanged by virtue of the merger, consolidation or similar transaction into
other property, whether in the form of securities, cash or otherwise. 
 (l) “Director” means a
member of the Board. 
 (m) “Disability” means the inability of a person, in the opinion of a
qualified physician acceptable to the Company, to perform the major duties of that person’s position with the Company or an Affiliate because of the sickness or injury of the person. 

 

 -3- 

 (n) “Employee” means any person employed by the Company or an
Affiliate. Service as a Director or payment of a director’s fee by the Company for such service or for service as a member of the Board of Directors of an Affiliate shall not be sufficient to constitute “employment” by the Company or
an Affiliate. 
 (o) “Entity” means a corporation, partnership or other entity. 

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

(q) “Exchange Act Person” means any natural person, Entity or “group” (within the meaning of
Section 13(d) or 14(d) of the Exchange Act), except that “Exchange Act Person” shall not include (A) the Company or any Subsidiary of the Company, (B) any employee benefit plan of the Company or any Subsidiary of the Company
or any trustee or other fiduciary holding securities under an employee benefit plan of the Company or any Subsidiary of the Company, (C) an underwriter temporarily holding securities pursuant to an offering of such securities, or (D) an
Entity Owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their Ownership of stock of the Company. 

(r) “Exchange Program” means a program under which (i) outstanding Stock Awards are
surrendered or cancelled in exchange for awards of the same type (which may have higher or lower exercise prices and different terms), awards of a different type, and/or cash, (ii) Participants would have the opportunity to transfer any
outstanding Stock Awards to a financial institution or other person or entity selected by the Board (or Committee, as applicable), and/or (iii) the exercise price of an outstanding award is increased or reduced. The Board (or Committee, as
applicable) will determine the terms and conditions of any Exchange Program in its sole discretion. 
 (s)
“Fair Market Value” means, as of any date, the value of the Common Stock determined in good faith by the Board, and in a manner consistent with Section 260.140.50 of Title 10 of the California Code of
Regulations. 
 (t) “Incentive Stock Option” means an Option intended to qualify as an incentive
stock option within the meaning of Section 422 of the Code and the regulations promulgated thereunder. 
 (u)
“Nonstatutory Stock Option” means an Option not intended to qualify as an Incentive Stock Option. 

(v) “Officer” means any person designated by the Company as an officer. 

(w) “Option” means an Incentive Stock Option or a Nonstatutory Stock Option granted pursuant to the Plan.

 (x) “Option Agreement” means a written agreement between the Company and an Optionholder
evidencing the terms and conditions of an individual Option grant. Each Option Agreement shall be subject to the terms and conditions of the Plan. 

(y) “Optionholder” means a person to whom an Option is granted pursuant to the Plan or, if applicable,
such other person who holds an outstanding Option. 
  

 -4- 

 (z) “Own,” “Owned,”
“Owner,” “Ownership.” A person or Entity shall be deemed to “Own,” to have “Owned,” to be the “Owner” of, or to have acquired “Ownership” of securities if such
person or Entity, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise, has or shares voting power, which includes the power to vote or to direct the voting, with respect to such securities. 

(aa) “Participant” means a person to whom a Stock Award is granted pursuant to the Plan or, if applicable,
such other person who holds an outstanding Stock Award. 
 (bb) “Plan” means this Pacific
Biosciences of California, Inc. 2004 Equity Incentive Plan. 
 (cc) “Securities Act” means the
Securities Act of 1933, as amended. 
 (dd) “Stock Award” means any right granted under the Plan,
including an Option, a stock bonus and a right to acquire restricted stock. 
 (ee) “Stock Award
Agreement” means a written agreement between the Company and a holder of a Stock Award evidencing the terms and conditions of an individual Stock Award grant. Each Stock Award Agreement shall be subject to the terms and conditions of
the Plan. 
 (ff) “Subsidiary” means, with respect to the Company, (i) any corporation of
which more than fifty percent (50%) of the outstanding capital stock having ordinary voting power to elect a majority of the board of directors of such corporation (irrespective of whether, at the time, stock of any other class or classes of
such corporation shall have or might have voting power by reason of the happening of any contingency) is at the time, directly or indirectly, Owned by the Company, and (ii) any partnership in which the Company has a direct or indirect interest
(whether in the form of voting or participation in profits or capital contribution) of more than fifty percent (50%). 
 (gg)
“Ten Percent Stockholder” means a person who Owns (or is deemed to Own pursuant to Section 424(4) of the Code) stock possessing more than ten percent (10%) of the total combined voting power of all classes of
stock of the Company or of any of its Affiliates. 
  

	 	3.	ADMINISTRATION. 

(a) Administration by Board. The Board shall administer the Plan unless and until the Board delegates administration to a
Committee, as provided in Section 3(c). 
 (b) Powers of Board. The Board shall have the power, subject to, and
within the limitations of, the express provisions of the Plan: 
 (i) To determine from time to time which of the
persons eligible under the Plan shall be granted Stock Awards; when and how each Stock Award shall be granted; what type or combination of types of Stock Award shall be granted; the provisions of each Stock Award granted (which need not be
identical), including the time or times when a person shall be permitted to receive Common Stock pursuant to a Stock Award; and the number of shares of Common Stock with respect to which a Stock Award shall be granted to each such person.

  

 -5- 

 (ii) To construe and interpret the Plan and Stock Awards granted under it, and to
establish, amend and revoke rules and regulations for its administration. The Board, in the exercise of this power, may correct any defect, omission or inconsistency in the Plan or in any Stock Award Agreement, in a manner and to the extent it shall
deem necessary or expedient to make the Plan fully effective. 
 (iii) To amend the Plan or a Stock Award as provided in
Section 12. 
 (iv) To terminate or suspend the Plan as provided in Section 13. 

(v) Generally, to exercise such powers and to perform such acts as the Board deems necessary or expedient to promote the best
interests of the Company and that are not in conflict with the provisions of the Plan. 
 (vi) To determine the terms
and conditions if any, and to institute any Exchange Program. 
 (c) Delegation to Committee. The Board may delegate
administration of the Plan to a Committee or Committees of one (1) or more members of the Board, and the term “Committee” shall apply to any person or persons to whom such authority has been delegated. If administration is delegated
to a Committee, the Committee shall have, in connection with the administration of the Plan, the powers theretofore possessed by the Board, including the power to delegate to a subcommittee any of the administrative powers the Committee is
authorized to exercise (and references in this Plan to the Board shall thereafter be to the Committee or subcommittee), subject, however, to such resolutions, not inconsistent with the provisions of the Plan, as may be adopted from time to time by
the Board. The Board may abolish the Committee at any time and revest in the Board the administration of the Plan. 
 (d)
Effect of Board’s Decision. All determinations, interpretations and constructions made by the Board in good faith shall not be subject to review by any person and shall be final, binding and conclusive on all persons. 

 

	 	4.	SHARES SUBJECT TO THE PLAN. 

(a) Share Reserve. Subject to the provisions of Section 11(a) relating to Capitalization Adjustments, the Common Stock that
may be issued pursuant to Stock Awards shall not exceed in the aggregate two million five hundred thousand (2,500,000) shares of Common Stock. 

(b) If any Stock Award shall for any reason expire or otherwise terminate, in whole or in part, without having been exercised in
full, or if any shares of Common Stock issued to a Participant pursuant to a Stock Award are forfeited back to or repurchased by the Company because of or in connection with the failure to meet a contingency or condition required to vest such shares
in the Participant, the shares of Common Stock not acquired, such Stock Award or the shares of Common Stock forfeited or repurchased under such Stock Award shall revert to and again become available for issuance under the Plan; provided,
however, that subject to the provisions of Section 11(a) relating to Capitalization Adjustments, the aggregate maximum number of shares of Common Stock that may be issued as Incentive Stock Options shall be five million
(5,000,000) shares of Common Stock. 
  

 -6- 

 (c) Source of Shares. The shares of Common Stock subject to the Plan may be unissued
shares or reacquired shares, bought on the market or otherwise. 
 (d) Share Reserve Limitation. To the extent required
by Section 260.140.45 of Title 10 of the California Code of Regulations, the total number of shares of Common Stock issuable upon exercise of all outstanding Options and the total number of shares of Common Stock provided for under any stock
bonus or similar plan of the Company shall not exceed the applicable percentage as calculated in accordance with the conditions and exclusions of Section 260.140.45 of Title 10 of the California Code of Regulations, based on the shares of
Common Stock of the Company that are outstanding at the time the calculation is made. 
  

	 	5.	ELIGIBILITY. 

(a) Eligibility for Specific Stock Awards. Incentive Stock Options may be granted only to Employees. Stock Awards other than
Incentive Stock Options may be granted to Employees, Directors and Consultants. 
 (b) Ten Percent Stockholders.

 (i) A Ten Percent Stockholder shall not be granted an Incentive Stock Option unless the exercise price of such Option
is at least one hundred ten percent (110%) of the Fair Market Value of the Common Stock on the date of grant and the Option is not exercisable after the expiration of five (5) years from the date of grant. 

(ii) A Ten Percent Stockholder shall not be granted a Nonstatutory Stock Option unless the exercise price of such Option is at
least (i) one hundred ten percent (110%) of the Fair Market Value of the Common Stock on the date of grant or (ii) such lower percentage of the Fair Market Value of the Common Stock on the date of grant as is permitted by
Section 260.140.41 of Title 10 of the California Code of Regulations at the time of the grant of the Option. 
 (iii)
A Ten Percent Stockholder shall not be granted a restricted stock award unless the purchase price of the restricted stock is at least (i) one hundred percent (100%) of the Fair Market Value of the Common Stock on the date of grant or
(ii) such lower percentage of the Fair Market Value of the Common Stock on the date of grant as is permitted by Section 260.140.42 of Title 10 of the California Code of Regulations at the time of the grant of the restricted stock award.

 (c) Consultants. A Consultant shall not be eligible for the grant of a Stock Award if, at the time of grant, either
the offer or the sale of the Company’s securities to such Consultant is not exempt under Rule 701 of the Securities Act (“Rule 701”) because of the nature of the services that the Consultant is providing to the Company, because the
Consultant is not a natural person, or because of some other provision of Rule 701, unless the Company determines that such grant need not comply with the requirements of Rule 701 and will satisfy another exemption under the Securities Act as well
as comply with the securities laws of all other relevant jurisdictions. 
  

 -7- 

	 	6.	OPTION PROVISIONS. 

Each Option shall be in such form and shall contain such terms and conditions as the Board shall deem appropriate. All Options shall be
separately designated Incentive Stock Options or Nonstatutory Stock Options at the time of grant, and, if certificates are issued, a separate certificate or certificates shall be issued for shares of Common Stock purchased on exercise of each type
of Option. The provisions of separate Options need not be identical, but each Option shall include (through incorporation of provisions hereof by reference in the Option or otherwise) the substance of each of the following provisions: 

(a) Term. Subject to the provisions of Section 5(b) regarding Ten Percent Stockholders, no Option shall be exercisable after
the expiration of ten (10) years from the date it was granted. 
 (b) Exercise Price of an Incentive Stock Option.
Subject to the provisions of Section 5(b) regarding Ten Percent Stockholders, the exercise price of each Incentive Stock Option shall be not less than one hundred percent (100%) of the Fair Market Value of the Common Stock subject to the
Option on the date the Option is granted. Notwithstanding the foregoing, an Incentive Stock Option may be granted with an exercise price lower than that set forth in the preceding sentence if such Option is granted pursuant to an assumption or
substitution for another option in a manner satisfying the provisions of Section 424(a) of the Code. 
 (c) Exercise
Price of a Nonstatutory Stock Option. Subject to the provisions of Section 5(b) regarding Ten Percent Stockholders, the exercise price of each Nonstatutory Stock Option shall be not less than eighty-five percent (85%) of the Fair
Market Value of the Common Stock subject to the Option on the date the Option is granted. Notwithstanding the foregoing, a Nonstatutory Stock Option may be granted with an exercise price lower than that set forth in the preceding sentence if such
Option is granted pursuant to an assumption or substitution for another option in a manner satisfying the provisions of Section 424(a) of the Code. 

(d) Consideration. The purchase price of Common Stock acquired pursuant to an Option shall be paid, to the extent permitted by
applicable statutes and regulations, either (i) in cash at the time the Option is exercised or (ii) at the discretion of the Board at the time of the grant of the Option (or subsequently in the case of a Nonstatutory Stock Option)
(1) by delivery to the Company of other Common Stock, (2) according to a deferred payment or other similar arrangement with the Optionholder or (3) in any other form of legal consideration that may be acceptable to the Board. Unless
otherwise specifically provided in the Option, the purchase price of Common Stock acquired pursuant to an Option that is paid by delivery to the Company of other Common Stock acquired, directly or indirectly from the Company, shall be paid only by
shares of the Common Stock of the Company that have been held for more than six (6) months (or such longer or shorter period of time required to avoid a charge to earnings for financial accounting purposes). At any time that the Company is
incorporated in Delaware, payment of the Common Stock’s “par value,” as defined in the Delaware General Corporation Law, shall not be made by deferred payment. 

In the case of any deferred payment arrangement, interest shall be compounded at least annually and shall be charged at the minimum rate
of interest necessary to avoid (1) the treatment as interest, under any applicable provisions of the Code, of any amounts other than amounts stated to be interest under the deferred payment arrangement and (2) the treatment of the Option
as a variable award for financial accounting purposes. 
  

 -8- 

 (e) Transferability of an Incentive Stock Option. An Incentive Stock Option shall not
be transferable except by will or by the laws of descent and distribution and shall be exercisable during the lifetime of the Optionholder only by the Optionholder. Notwithstanding the foregoing, the Optionholder may, by delivering written notice to
the Company, in a form satisfactory to the Company, designate a third party who, in the event of the death of the Optionholder, shall thereafter be entitled to exercise the Option. 

(f) Transferability of a Nonstatutory Stock Option. A Nonstatutory Stock Option shall not be transferable except by will or by the
laws of descent and distribution and, to the extent provided in the Option Agreement, to such further extent as permitted by Section 260.140.41(d) of Title 10 of the California Code of Regulations at the time of the grant of the Option, and
shall be exercisable during the lifetime of the Optionholder only by the Optionholder. If the Nonstatutory Stock Option does not provide for transferability, then the Nonstatutory Stock Option shall not be transferable except by will or by the laws
of descent and distribution and shall be exercisable during the lifetime of the Optionholder only by the Optionholder. Notwithstanding the foregoing, the Optionholder may, by delivering written notice to the Company, in a form satisfactory to the
Company, designate a third party who, in the event of the death of the Optionholder, shall thereafter be entitled to exercise the Option. 

(g) Vesting Generally. The total number of shares of Common Stock subject to an Option may, but need not, vest and therefore
become exercisable in periodic installments that may, but need not, be equal. The Option may be subject to such other terms and conditions on the time or times when it may be exercised (which may be based on performance or other criteria) as the
Board may deem appropriate. The vesting provisions of individual Options may vary. The provisions of this Section 6(g) are subject to any Option provisions governing the minimum number of shares of Common Stock as to which an Option may be
exercised. 
 (h) Minimum Vesting. Notwithstanding the foregoing Section 6(g), to the extent that the following
restrictions on vesting are required by Section 260.140.41(f) of Title 10 of the California Code of Regulations at the time of the grant of the Option, then: 

(i) Options granted to an Employee who is not an Officer, Director or Consultant shall provide for vesting of the total number of
shares of Common Stock at a rate of at least twenty percent (20%) per year over five (5) years from the date the Option was granted, subject to reasonable conditions such as continued employment; and 

(ii) Options granted to Officers, Directors or Consultants may be made fully exercisable, subject to reasonable conditions such
as continued employment, at any time or during any period established by the Company. 
 (i) Termination of Continuous
Service. In the event that an Optionholder’s Continuous Service terminates (other than upon the Optionholder’s death or Disability), the Optionholder may exercise his or her Option (to the extent that the Optionholder was entitled to
exercise such Option as of the date of termination) but only within such period of time ending on the 
  

 -9- 

 
earlier of (i) the date three (3) months following the termination of the Optionholder’s Continuous Service (or such longer or shorter period specified in the Option Agreement,
which period shall not be less than thirty (30) days unless such termination is for cause), or (ii) the expiration of the term of the Option as set forth in the Option Agreement. If, after termination, the Optionholder does not exercise
his or her Option within the time specified in the Option Agreement, the Option shall terminate. 
 (j) Extension of
Termination Date. An Optionholder’s Option Agreement may also provide that if the exercise of the Option following the termination of the Optionholder’s Continuous Service (other than upon the Optionholder’s death or Disability)
would be prohibited at any time solely because the issuance of shares of Common Stock would violate the registration requirements under the Securities Act, then the Option shall terminate on the earlier of (i) the expiration of the term of the
Option set forth in Section 6(a) or (ii) the expiration of a period of three (3) months after the termination of the Optionholder’s Continuous Service during which the exercise of the Option would not be in violation of such
registration requirements. 
 (k) Disability of Optionholder. In the event that an Optionholder’s Continuous Service
terminates as a result of the Optionholder’s Disability, the Optionholder may exercise his or her Option (to the extent that the Optionholder was entitled to exercise such Option as of the date of termination), but only within such period of
time ending on the earlier of (i) the date twelve (12) months following such termination (or such longer or shorter period specified in the Option Agreement, which period shall not be less than six (6) months) or (ii) the
expiration of the term of the Option as set forth in the Option Agreement. If, after termination, the Optionholder does not exercise his or her Option within the time specified herein, the Option shall terminate. 

(l) Death of Optionholder. In the event that (i) an Optionholder’s Continuous Service terminates as a result of the
Optionholder’s death or (ii) the Optionholder dies within the period (if any) specified in the Option Agreement after the termination of the Optionholder’s Continuous Service for a reason other than death, then the Option may be
exercised (to the extent the Optionholder was entitled to exercise such Option as of the date of death) by the Optionholder’s estate, by a person who acquired the right to exercise the Option by bequest or inheritance or by a person designated
to exercise the option upon the Optionholder’s death pursuant to Section 6(e) or 6(f), but only within the period ending on the earlier of (1) the date eighteen (18) months following the date of death (or such longer or shorter
period specified in the Option Agreement, which period shall not be less than six (6) months) or (2) the expiration of the term of such Option as set forth in the Option Agreement. If, after death, the Option is not exercised within the
time specified herein, the Option shall terminate. 
 (m) Early Exercise. The Option may, but need not, include a
provision whereby the Optionholder may elect at any time before the Optionholder’s Continuous Service terminates to exercise the Option as to any part or all of the shares of Common Stock subject to the Option prior to the full vesting of the
Option. Subject to the “Repurchase Limitation” in Section 10(h), any unvested shares of Common Stock so purchased may be subject to a repurchase option in favor of the Company or to any other restriction the Board determines to be
appropriate. Provided that the “Repurchase Limitation” in Section 10(h) is not violated, the Company will not exercise its repurchase option until at least six (6) months (or such longer or shorter period of time required to
avoid a charge to earnings for financial accounting purposes) have elapsed following exercise of the Option unless the Board otherwise specifically provides in the Option. 
  

 -10- 

 (n) Right of Repurchase. Subject to the “Repurchase Limitation” in
Section 10(h), the Option may, but need not, include a provision whereby the Company may elect to repurchase all or any part of the vested shares of Common Stock acquired by the Optionholder pursuant to the exercise of the Option. Provided that
the “Repurchase Limitation” in Section 10(h) is not violated, the Company will not exercise its repurchase option until at least six (6) months (or such longer or shorter period of time required to avoid a charge to earnings for
financial accounting purposes) have elapsed following exercise of the Option unless otherwise specifically provided in the Option. 

(o) Right of First Refusal. The Option may, but need not, include a provision whereby the Company may elect to exercise a right of
first refusal following receipt of notice from the Optionholder of the intent to transfer all or any part of the shares of Common Stock received upon the exercise of the Option. Except as expressly provided in this Section 6(o) or in the Stock
Award Agreement for the Option, such right of first refusal shall otherwise comply with any applicable provisions of the Bylaws of the Company. The Company will not exercise its right of first refusal until at least six (6) months (or such
longer or shorter period of time required to avoid a charge to earnings for financial accounting purposes) have elapsed following the exercise of the Option unless otherwise specifically provided in the Option. 

 

	 	7.	PROVISIONS OF STOCK AWARDS OTHER THAN OPTIONS.

 (a) Stock Bonus Awards. Each stock bonus agreement shall be in such form and shall contain such terms
and conditions as the Board shall deem appropriate. The terms and conditions of stock bonus agreements may change from time to time, and the terms and conditions of separate stock bonus agreements need not be identical, but each stock bonus
agreement shall include (through incorporation of provisions hereof by reference in the agreement or otherwise) the substance of each of the following provisions: 

(i) Consideration. A stock bonus may be awarded in consideration for past services actually rendered to the Company or an
Affiliate for its benefit. 
 (ii) Vesting. Subject to the “Repurchase Limitation” in Section 10(h),
shares of Common Stock awarded under the stock bonus agreement may, but need not, be subject to a share repurchase option in favor of the Company in accordance with a vesting schedule to be determined by the Board. 

(iii) Termination of Participant’s Continuous Service. Subject to the “Repurchase Limitation” in
Section 10(h), in the event that a Participant’s Continuous Service terminates, the Company may reacquire any or all of the shares of Common Stock held by the Participant that have not vested as of the date of termination under the terms
of the stock bonus agreement. Provided that the “Repurchase Limitation” in Section 10(h) is not violated, the Company will not exercise its repurchase option until at least six (6) months (or such longer or shorter period of time
required to avoid a charge to earnings for financial accounting purposes) have elapsed following receipt of the stock bonus unless otherwise specifically provided in the stock bonus agreement. 

 

 -11- 

 (iv) Transferability. Rights to acquire shares of Common Stock under the stock bonus
agreement shall not be transferable except by will or by the laws of descent and distribution and shall be exercisable during the lifetime of the Participant only by the Participant. 

(b) Restricted Stock Awards. Each restricted stock purchase agreement shall be in such form and shall contain such terms and
conditions as the Board shall deem appropriate. The terms and conditions of the restricted stock purchase agreements may change from time to time, and the terms and conditions of separate restricted stock purchase agreements need not be identical,
but each restricted stock purchase agreement shall include (through incorporation of provisions hereof by reference in the agreement or otherwise) the substance of each of the following provisions: 

(i) Purchase Price. Subject to the provisions of Section 5(b) regarding Ten Percent Stockholders, the purchase price of
restricted stock awards shall not be less than eighty-five percent (85%) of the Common Stock’s Fair Market Value on the date such award is made or at the time the purchase is consummated. 

(ii) Consideration. The purchase price of Common Stock acquired pursuant to the restricted stock purchase agreement shall be paid
either: (i) in cash at the time of purchase; (ii) at the discretion of the Board, according to a deferred payment or other similar arrangement with the Participant; or (iii) in any other form of legal consideration that may be
acceptable to the Board in its discretion; provided, however, that at any time that the Company is incorporated in Delaware, then payment of the Common Stock’s “par value,” as defined in the Delaware General Corporation
Law, shall not be made by deferred payment. 
 (iii) Vesting. Subject to the “Repurchase Limitation” in
Section 10(h), shares of Common Stock acquired under the restricted stock purchase agreement may, but need not, be subject to a share repurchase option in favor of the Company in accordance with a vesting schedule to be determined by the Board.

 (iv) Termination of Participant’s Continuous Service. Subject to the “Repurchase Limitation” in
Section 10(h), in the event that a Participant’s Continuous Service terminates, the Company may repurchase or otherwise reacquire any or all of the shares of Common Stock held by the Participant that have not vested as of the date of
termination under the terms of the restricted stock purchase agreement. Provided that the “Repurchase Limitation” in Section 10(h) is not violated, the Company will not exercise its repurchase option until at least six (6) months
(or such longer or shorter period of time required to avoid a charge to earnings for financial accounting purposes) have elapsed following the purchase of the restricted stock unless otherwise specifically provided in the restricted stock purchase
agreement. 
 (v) Transferability. Rights to acquire shares of Common Stock under the restricted stock purchase
agreement shall not be transferable except by will or by the laws of descent and distribution and shall be exercisable during the lifetime of the Participant only by the Participant. 

 

 -12- 

	 	8.	COVENANTS OF THE COMPANY. 

(a) Availability of Shares. During the terms of the Stock Awards, the Company shall keep available at all times the number of
shares of Common Stock required to satisfy such Stock Awards. 
 (b) Securities Law Compliance. The Company shall seek to
obtain from each regulatory commission or agency having jurisdiction over the Plan such authority as may be required to grant Stock Awards and to issue and sell shares of Common Stock upon exercise of the Stock Awards; provided,
however, that this undertaking shall not require the Company to register under the Securities Act the Plan, any Stock Award or any Common Stock issued or issuable pursuant to any such Stock Award. If, after reasonable efforts, the Company is
unable to obtain from any such regulatory commission or agency the authority which counsel for the Company deems necessary for the lawful issuance and sale of Common Stock under the Plan, the Company shall be relieved from any liability for failure
to issue and sell Common Stock upon exercise of such Stock Awards unless and until such authority is obtained. 
  

	 	9.	USE OF PROCEEDS FROM STOCK. 

Proceeds from the sale of Common Stock pursuant to Stock Awards shall constitute general funds of the Company. 

 

	 	10.	MISCELLANEOUS. 

(a) Acceleration of Exercisability and Vesting. The Board shall have the power to accelerate the time at which a Stock Award may
first be exercised or the time during which a Stock Award or any part thereof will vest in accordance with the Plan, notwithstanding the provisions in the Stock Award stating the time at which it may first be exercised or the time during which it
will vest. 
 (b) Stockholder Rights. No Participant shall be deemed to be the holder of, or to have any of the rights of
a holder with respect to, any shares of Common Stock subject to such Stock Award unless and until such Participant has satisfied all requirements for exercise of the Stock Award pursuant to its terms. 

(c) No Employment or other Service Rights. Nothing in the Plan or any instrument executed or Stock Award granted pursuant thereto
shall confer upon any Participant any right to continue to serve the Company or an Affiliate in the capacity in effect at the time the Stock Award was granted or shall affect the right of the Company or an Affiliate to terminate (i) the
employment of an Employee with or without notice and with or without cause, (ii) the service of a Consultant pursuant to the terms of such Consultant’s agreement with the Company or an Affiliate or (iii) the service of a Director
pursuant to the Bylaws of the Company or an Affiliate, and any applicable provisions of the corporate law of the state in which the Company or the Affiliate is incorporated, as the case may be. 

(d) Incentive Stock Option $100,000 Limitation. To the extent that the aggregate Fair Market Value (determined at the time of
grant) of Common Stock with respect to 
  

 -13- 

 
which Incentive Stock Options are exercisable for the first time by any Optionholder during any calendar year (under all plans of the Company and its Affiliates) exceeds one hundred thousand
dollars ($100,000), the Options or portions thereof that exceed such limit (according to the order in which they were granted) shall be treated as Nonstatutory Stock Options, notwithstanding any contrary provision of a Stock Award Agreement.

 (e) Investment Assurances. The Company may require a Participant, as a condition of exercising or acquiring Common
Stock under any Stock Award, (i) to give written assurances satisfactory to the Company as to the Participant’s knowledge and experience in financial and business matters and/or to employ a purchaser representative reasonably satisfactory
to the Company who is knowledgeable and experienced in financial and business matters and that he or she is capable of evaluating, alone or together with the purchaser representative, the merits and risks of exercising the Stock Award; and
(ii) to give written assurances satisfactory to the Company stating that the Participant is acquiring Common Stock subject to the Stock Award for the Participant’s own account and not with any present intention of selling or otherwise
distributing the Common Stock. The foregoing requirements, and any assurances given pursuant to such requirements, shall be inoperative if (1) the issuance of the shares of Common Stock upon the exercise or acquisition of Common Stock under the
Stock Award has been registered under a then currently effective registration statement under the Securities Act or (2) as to any particular requirement, a determination is made by counsel for the Company that such requirement need not be met
in the circumstances under the then applicable securities laws. The Company may, upon advice of counsel to the Company, place legends on stock certificates issued under the Plan as such counsel deems necessary or appropriate in order to comply with
applicable securities laws, including, but not limited to, legends restricting the transfer of the Common Stock. 
 (f)
Withholding Obligations. To the extent provided by the terms of a Stock Award Agreement, the Participant may satisfy any federal, state or local tax withholding obligation relating to the exercise or acquisition of Common Stock under a Stock
Award by any of the following means (in addition to the Company’s right to withhold from any compensation paid to the Participant by the Company) or by a combination of such means: (i) tendering a cash payment; (ii) authorizing the
Company to withhold shares of Common Stock from the shares of Common Stock otherwise issuable to the Participant as a result of the exercise or acquisition of Common Stock under the Stock Award; provided, however, that no shares of
Common Stock are withheld with a value exceeding the minimum amount of tax required to be withheld by law (or such lower amount as may be necessary to avoid variable award accounting); or (iii) delivering to the Company owned and unencumbered
shares of Common Stock. 
 (g) Information Obligation. To the extent required by Section 260.140.46 of Title 10 of
the California Code of Regulations, the Company shall deliver financial statements to Participants at least annually. This Section 10(g) shall not apply to key Employees whose duties in connection with the Company assure them access to
equivalent information. 
 (h) Repurchase Limitation. The terms of any repurchase option shall be specified in the Stock
Award, and the repurchase price may be either the Fair Market Value of the shares of Common Stock on the date of termination of Continuous Service or the lower of (i) the Fair Market Value of the shares of Common Stock on the date of repurchase
or (ii) their original purchase price. To the extent required by Section 260.140.41 and Section 260.140.42 of Title 10 of 

 

 -14- 

 
the California Code of Regulations at the time a Stock Award is made, any repurchase option contained in a Stock Award granted to a person who is not an Officer, Director or Consultant shall be
upon the terms described below: 
 (i) Fair Market Value. If the repurchase option gives the Company the right to
repurchase the shares of Common Stock upon termination of Continuous Service at not less than the Fair Market Value of the shares of Common Stock to be purchased on the date of termination of Continuous Service, then (i) the right to repurchase
shall be exercised for cash or cancellation of purchase money indebtedness for the shares of Common Stock within ninety (90) days of termination of Continuous Service (or in the case of shares of Common Stock issued upon exercise of Stock
Awards after such date of termination, within ninety (90) days after the date of the exercise) or such longer period as may be agreed to by the Company and the Participant (for example, for purposes of satisfying the requirements of
Section 1202(c)(3) of the Code regarding “qualified small business stock”) and (ii) the right terminates when the shares of Common Stock become publicly traded. 

(ii) Original Purchase Price. If the repurchase option gives the Company the right to repurchase the shares of Common Stock upon
termination of Continuous Service at the lower of (i) the Fair Market Value of the shares of Common Stock on the date of repurchase or (ii) their original purchase price, then (x) the right to repurchase at the original purchase price
shall lapse at the rate of at least twenty percent (20%) of the shares of Common Stock per year over five (5) years from the date the Stock Award is granted (without respect to the date the Stock Award was exercised or became exercisable)
and (y) the right to repurchase shall be exercised for cash or cancellation of purchase money indebtedness for the shares of Common Stock within ninety (90) days of termination of Continuous Service (or in the case of shares of Common
Stock issued upon exercise of Options after such date of termination, within ninety (90) days after the date of the exercise) or such longer period as may be agreed to by the Company and the Participant (for example, for purposes of satisfying
the requirements of Section 1202(c)(3) of the Code regarding “qualified small business stock”). 
  

	 	11.	ADJUSTMENTS UPON CHANGES IN STOCK. 

(a) Capitalization Adjustments. If any change is made in, or other event occurs with respect to, the Common Stock subject to the
Plan or subject to any Stock Award without the receipt of consideration by the Company (through merger, consolidation, reorganization, recapitalization, reincorporation, stock dividend, dividend in property other than cash, stock split, liquidating
dividend, combination of shares, exchange of shares, change in corporate structure or other transaction not involving the receipt of consideration by the Company (each a “Capitalization Adjustment”), the Plan will be appropriately adjusted
in the class(es) and maximum number of securities subject to the Plan pursuant to Sections 4(a) and 4(b) and the outstanding Stock Awards will be appropriately adjusted in the class(es) and number of securities and price per share of Common Stock
subject to such outstanding Stock Awards. The Board shall make such adjustments, and its determination shall be final, binding and conclusive. (The conversion of any convertible securities of the Company shall not be treated as a transaction
“without receipt of consideration” by the Company.) 
  

 -15- 

 (b) Dissolution or Liquidation. In the event of a dissolution or liquidation of the
Company, then all outstanding Options shall terminate immediately prior to the completion of such dissolution or liquidation, and shares of Common Stock subject to the Company’s repurchase option may be repurchased by the Company
notwithstanding the fact that the holder of such stock is still in Continuous Service. 
 (c) Corporate Transaction. In
the event of a Corporate Transaction, any surviving corporation or acquiring corporation may assume or continue any or all Stock Awards outstanding under the Plan or may substitute similar stock awards for Stock Awards outstanding under the Plan (it
being understood that similar stock awards include, but are not limited to, awards to acquire the same consideration paid to the stockholders or the Company, as the case may be, pursuant to the Corporate Transaction), and any reacquisition or
repurchase rights held by the Company in respect of Common Stock issued pursuant to Stock Awards may be assigned by the Company to the successor of the Company (or such successor’s parent company), if any, in connection with such Corporate
Transaction. In the event that any surviving corporation or acquiring corporation does not assume or continue any or all such outstanding Stock Awards or substitute similar stock awards for such outstanding Stock Awards, then with respect to Stock
Awards that have not been assumed, continued or substituted and that are held by Participants whose Continuous Service has not terminated prior to the effective time of the Corporate Transaction, the vesting of such Stock Awards (and, if applicable,
the time at which such Stock Awards may be exercised) shall (contingent upon the effectiveness of the Corporate Transaction) be accelerated in full to a date prior to the effective time of such Corporate Transaction as the Board shall determine (or,
if the Board shall not determine such a date, to the date that is five (5) days prior to the effective time of the Corporate Transaction), the Stock Awards shall terminate if not exercised (if applicable) at or prior to such effective time, and
any reacquisition or repurchase rights held by the Company with respect to such Stock Awards held by Participants whose Continuous Service has not terminated shall (contingent upon the effectiveness of the Corporate Transaction) lapse. With respect
to any other Stock Awards outstanding under the Plan that have not been assumed, continued or substituted, the vesting of such Stock Awards (and, if applicable, the time at which such Stock Award may be exercised) shall not be accelerated, unless
otherwise provided in a written agreement between the Company or any Affiliate and the holder of such Stock Award, and such Stock Awards shall terminate if not exercised (if applicable) prior to the effective time of the Corporate Transaction.

 (d) Change in Control. A Stock Award held by any Participant whose Continuous Service has not terminated prior to the
effective time of a Change in Control may be subject to additional acceleration of vesting and exercisability upon or after such event as may be provided in the Stock Award Agreement for such Stock Award or as may be provided in any other written
agreement between the Company or any Affiliate and the Participant, but in the absence of such provision, no such acceleration shall occur. 
  

	 	12.	AMENDMENT OF THE PLAN AND STOCK AWARDS.

 (a) Amendment of Plan. The Board at any time, and from time to time, may amend the Plan. However,
except as provided in Section 11(a) relating to Capitalization Adjustments, no amendment shall be effective unless approved by the stockholders of the Company to the extent stockholder approval is necessary to satisfy the requirements of
Section 422 of the Code. 
  

 -16- 

 (b) Stockholder Approval. The Board, in its sole discretion, may submit any other
amendment to the Plan for stockholder approval. 
 (c) Contemplated Amendments. It is expressly contemplated that the
Board may amend the Plan in any respect the Board deems necessary or advisable to provide eligible Employees with the maximum benefits provided or to be provided under the provisions of the Code and the regulations promulgated thereunder relating to
Incentive Stock Options and/or to bring the Plan and/or Incentive Stock Options granted under it into compliance therewith. 

(d) No Impairment of Rights. Rights under any Stock Award granted before amendment of the Plan shall not be impaired by any
amendment of the Plan unless (i) the Company requests the consent of the Participant and (ii) the Participant consents in writing. 

(e) Amendment of Stock Awards. The Board at any time, and from time to time, may amend the terms of any one or more Stock Awards;
provided, however, that the rights under any Stock Award shall not be impaired by any such amendment unless (i) the Company requests the consent of the Participant and (ii) the Participant consents in writing. 

 

	 	13.	TERMINATION OR SUSPENSION OF THE PLAN. 

(a) Plan Term. The Board may suspend or terminate the Plan at any time. Unless sooner terminated, the Plan shall terminate on the
day before the tenth (10th) anniversary of the date the Plan is adopted by the Board or approved by the stockholders of the Company, whichever is earlier. No Stock Awards may be granted under the Plan while the Plan is suspended or after it is
terminated. 
 (b) No Impairment of Rights. Suspension or termination of the Plan shall not impair rights and obligations
under any Stock Award granted while the Plan is in effect except with the written consent of the Participant. 
  

	 	14.	EFFECTIVE DATE OF PLAN. 

The Plan shall become effective as determined by the Board, but no Stock Award shall be exercised (or, in the case of a stock bonus, shall
be granted) unless and until the Plan has been approved by the stockholders of the Company, which approval shall be within twelve (12) months before or after the date the Plan is adopted by the Board. 

 

	 	15.	CHOICE OF LAW. 

The law of the State of California shall govern all questions concerning the construction, validity and interpretation of this Plan,
without regard to such state’s conflict of laws rules. 
  

 -17- 

 NOTICE OF EXERCISE 

Pacific Biosciences of California, Inc. 
 Date
of Exercise:                          

Pacific Biosciences of California 
 1380 Willow
Road 
 Menlo Park, CA 94025 
 Ladies
and Gentlemen: 
 This constitutes notice under my stock option that I elect to purchase the number of shares for the price set
forth below. 
  

					
	Type of option (check one):	 	Incentive   ̈	 	Nonstatutory   ̈
			
	Stock option dated:	 	  
	 	
			
	 Number of shares as to which option

is exercised:
	 	  
	 	
			
	Certificates to be issued in name of:	 	  
	 	
			
	Total exercise price:	 	 $
	 	
			
	Cash payment delivered herewith:	 	 $
	 	

 By this exercise, I agree (i) to provide such additional documents as you may require
pursuant to the terms of the 2004 Equity Incentive Plan, (ii) to provide for the payment by me to you (in the manner designated by you) of your withholding obligation, if any, relating to the exercise of this option, and (iii) if this
exercise relates to an incentive stock option, to notify you in writing within fifteen (15) days after the date of any disposition of any of the shares of Common Stock issued upon exercise of this option that occurs within two (2) years
after the date of grant of this option or within one (1) year after such shares of Common Stock are issued upon exercise of this option. 

I hereby make the following certifications and representations with respect to the number of shares of Common Stock of the Company listed
above (the “Shares”), which are being acquired by me for my own account upon exercise of the Option as set forth above: 

I acknowledge that the Shares have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), and
are deemed to constitute “restricted securities” under Rule 701 and “control securities” under Rule 144 promulgated under the Securities Act. I warrant and represent to the Company that I have no present intention of distributing
or selling said Shares, except as permitted under the Securities Act and any applicable state securities laws. 

 I further acknowledge that I will not be able to resell the Shares for at least ninety days
(90) after the stock of the Company becomes publicly traded (i.e., subject to the reporting requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934) under Rule 701 and that more restrictive conditions apply to
affiliates of the Company under Rule 144. 
 I further acknowledge that all certificates representing any of the Shares subject
to the provisions of the Option shall have endorsed thereon appropriate legends reflecting the foregoing limitations, as well as any legends reflecting restrictions pursuant to the Company’s Articles of Incorporation, Bylaws and/or applicable
securities laws. 
  

	
	Very truly yours,
	
	  

 PACIFIC BIOSCIENCES OF CALIFORNIA, INC. 

2004 EQUITY INCENTIVE PLAN 

EARLY EXERCISE STOCK PURCHASE AGREEMENT 

This Early Exercise Stock Purchase Agreement (the “Agreement”) is made as of
                    ,          by and between Pacific Biosciences of California, Inc., a
Delaware corporation (the “Company”), and                     , the (“Purchaser”). 

Unless otherwise defined herein, the terms defined in the 2004 Equity Incentive Plan (the “Plan”) shall have the same
defined meanings in this Agreement. 
 RECITALS 

A. Pursuant to the exercise of the option (grant number         ) (the “Option”) granted
to Purchaser under the Plan and pursuant to the notice of grant and stock option agreement dated                     ,
         (together, the “Option Agreement”) by and between the Company and Purchaser with respect to such grant, which Plan and Option Agreement are hereby incorporated by reference,
Purchaser has elected to purchase                      of those shares of Common Stock which have not become vested under the vesting schedule
set forth in the Option Agreement (“Unvested Shares”). The Unvested Shares and the shares subject to the Option Agreement which have become vested are sometimes collectively referred to herein as the “Shares.”

 B. As required by the Option Agreement, as a condition to Purchaser’s election to exercise the option, Purchaser must execute this
Agreement, which sets forth the rights and obligations of the parties with respect to Shares acquired upon exercise of the Option. 

1. Repurchase Option. 

(a) If Purchaser’s Continuous Service is terminated for any reason, including for death and Disability, the Company shall have the
right and option to purchase from Purchaser, or Purchaser’s personal representative, as the case may be, all of the Purchaser’s Unvested Shares as of the date of such termination at the original price paid by the Purchaser for such Shares
(the “Repurchase Option”). 
 (b) Upon the occurrence of such termination, the Company may exercise its
Repurchase Option by delivering personally or by registered mail, to Purchaser (or his transferee or legal representative, as the case may be), within ninety (90) days of the termination of Continuous Service, a notice in writing indicating the
Company’s intention to exercise the Repurchase Option and setting forth a date for closing not later than thirty (30) days from the mailing of such notice. The closing shall take place at the Company’s office. At the closing, the
holder of the certificates for the Unvested Shares being transferred shall deliver the stock certificate or certificates evidencing the Unvested Shares, and the Company shall deliver the purchase price therefor. The Company may designate and assign
one or more employees, officers, directors or stockholders of the Company or other persons or organizations to exercise all or a part of the Company’s Repurchase Option. 

 (c) At its option, the Company may elect to make payment for the Unvested Shares to a bank
selected by the Company. The Company shall avail itself of this option by a notice in writing to Purchaser stating the name and address of the bank, date of closing, and waiving the closing at the Company’s office. 

(d) If the Company does not elect to exercise the Repurchase Option conferred above by giving the requisite notice within ninety
(90) days following the termination, the Repurchase Option shall terminate. 
 (e) The Repurchase Option shall terminate in
accordance with the vesting schedule contained in the Option Agreement relating to the Option. 
 2. Transferability of the
Shares; Escrow. 
 (a) Purchaser hereby authorizes and directs the Secretary of the Company, or such other person designated
by the Company, to transfer the Unvested Shares as to which the Repurchase Option has been exercised from Purchaser to the Company. 

(b) To insure the availability for delivery of Purchaser’s Unvested Shares upon repurchase by the Company pursuant to the Repurchase
Option under Section 1, Purchaser hereby appoints the Secretary, or any other person designated by the Company as escrow agent, as its attorney-in-fact to sell, assign and transfer unto the Company, such Unvested Shares, if any, repurchased by
the Company pursuant to the Repurchase Option and shall, upon execution of this Agreement, deliver and deposit with the Secretary of the Company, or such other person designated by the Company, the share certificates representing the Unvested
Shares, together with the stock assignment duly endorsed in blank, attached hereto as Exhibit A. The Unvested Shares and stock assignment shall be held by the secretary in escrow, pursuant to the Joint Escrow Instructions of the Company and
Purchaser attached as Exhibit B hereto, until the Company exercises its Repurchase Option, until such Unvested Shares are vested, or until such time as this Agreement no longer is in effect. Upon vesting of the Unvested Shares, the escrow
agent shall promptly deliver to the Purchaser the certificate or certificates representing such Shares in the escrow agent’s possession belonging to the Purchaser, and the escrow agent shall be discharged of all further obligations hereunder;
provided, however, that the escrow agent shall nevertheless retain such certificate or certificates as escrow agent if so required pursuant to other restrictions imposed pursuant to this Agreement. 

(c) The Company, or its designee, shall not be liable for any act it may do or omit to do with respect to holding the Shares in escrow
and while acting in good faith and in the exercise of its judgment. 
 (d) Transfer or sale of the Shares is subject to
restrictions on transfer imposed by any applicable state and federal securities laws. Any transferee shall hold such Shares subject to all the provisions hereof and the Exercise Notice executed by the Purchaser with respect to any Unvested Shares
purchased by Purchaser and shall acknowledge the same by signing a copy of this Agreement. 
  

 -2- 

 (e) Unvested Shares. No Unvested Shares subject to the Repurchase Option contained in
Section 1 of this Agreement, nor any beneficial interest in such Shares, shall be sold, gifted, transferred, encumbered or otherwise disposed of in any way (whether by operation of law or otherwise) by the Purchaser, except as provided in this
Agreement. 
 (f) Vested Shares. No Shares purchased pursuant to this Agreement, nor any beneficial interest in such
Shares, shall be sold, transferred, encumbered or otherwise disposed of in any way (whether by operation of law or otherwise) by the Purchaser or any subsequent transferee, other than in compliance with the Company’s right of first refusal
provisions contained in the Option Agreement related to the Option or in this Agreement or except as provided in this Agreement. 

3. Company's Right of First Refusal. Before any Shares held by Purchaser or any transferee (either being sometimes referred to
herein as the “Holder”) may be sold or otherwise transferred (including transfer by gift or operation of law), the Company or its assignee(s) shall have a right of first refusal to purchase the Shares on the terms and conditions set
forth in this Section (the “Right of First Refusal”). 
 (a) Notice of Proposed Transfer. The Holder of
the Shares shall deliver to the Company a written notice (the “Notice”) stating: (i) the Holder's bona fide intention to sell or otherwise transfer such Shares; (ii) the name of each proposed purchaser or other transferee
(“Proposed Transferee”); (iii) the number of Shares to be transferred to each Proposed Transferee; and (iv) the bona fide cash price or other consideration for which the Holder proposes to transfer the Shares (the
“Offered Price”), and the Holder shall offer the Shares at the Offered Price to the Company or its assignee(s). 

(b) Exercise of Right of First Refusal. At any time within thirty (30) days after receipt of the Notice, the Company and/or
its assignee(s) may, by giving written notice to the Holder, elect to purchase all, but not less than all, of the Shares proposed to be transferred to any one or more of the Proposed Transferees, at the purchase price determined in accordance with
subsection (c) below. 
 (c) Purchase Price. The purchase price (“Purchase Price”) for the Shares
purchased by the Company or its assignee(s) under this Section shall be the Offered Price. If the Offered Price includes consideration other than cash, the cash equivalent value of the non-cash consideration shall be determined by the Board of
Directors of the Company in good faith. 
 (d) Payment. Payment of the Purchase Price shall be made, at the option of the
Company or its assignee(s), in cash (by check), by cancellation of all or a portion of any outstanding indebtedness of the Holder to the Company (or, in the case of repurchase by an assignee, to the assignee), or by any combination thereof within 30
days after receipt of the Notice or in the manner and at the times set forth in the Notice. 
 (e) Holder's Right to
Transfer. If all of the Shares proposed in the Notice to be transferred to a given Proposed Transferee are not purchased by the Company and/or its assignee(s) 

 

 -3- 

 
as provided in this Section, then the Holder may sell or otherwise transfer such Shares to that Proposed Transferee at the Offered Price or at a higher price, provided that such sale or other
transfer is consummated within 120 days after the date of the Notice, that any such sale or other transfer is effected in accordance with any applicable securities laws and that the Proposed Transferee agrees in writing that the provisions of this
Section shall continue to apply to the Shares in the hands of such Proposed Transferee. If the Shares described in the Notice are not transferred to the Proposed Transferee within such period, a new Notice shall be given to the Company, and the
Company and/or its assignees shall again be offered the Right of First Refusal before any Shares held by the Holder may be sold or otherwise transferred. 

(f) Exception for Certain Family Transfers. Anything to the contrary contained in this Section notwithstanding, the transfer of
any or all of the Shares during the Purchaser's lifetime or on the Purchaser's death by will or intestacy to the Purchaser's immediate family or a trust for the benefit of the Purchaser's immediate family shall be exempt from the provisions of this
Section. “Immediate Family” as used herein shall mean spouse, lineal descendant or antecedent, father, mother, brother or sister. In such case, the transferee or other recipient shall receive and hold the Shares so transferred subject to
the provisions of this Section, and there shall be no further transfer of such Shares except in accordance with the terms of this Section. 

(g) Termination of Right of First Refusal. The Right of First Refusal shall terminate as to any Shares upon the earlier of
(i) first sale of Common Stock of the Company to the general public, or (ii) a Change in Control in which the successor corporation has equity securities that are publicly traded. 

4. Ownership, Voting Rights, Duties. This Agreement shall not affect in any way the ownership, voting rights or other rights or
duties of Purchaser, except as specifically provided herein. Until the issuance of the Shares (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive
dividends or any other rights as a shareholder shall exist with respect to the Shares, notwithstanding the exercise of the Option. No adjustment shall be made for a dividend or other right for which the record date is prior to the date of issuance
except as provided in of the Plan. 
 5. Restrictive Legends and Stop-Transfer Orders. 

(a) Legends. The Purchaser hereby makes the investment representations listed on Exhibit C to the Company as of the date of this
Agreement and as of the date of the Closing, and agrees that such representations are incorporated into this Agreement by this reference, such that the Company may rely on them in issuing the Shares. Purchaser 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 SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE
“ACT”) AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR, IN THE OPINION OF 

 

 -4- 

 
COUNSEL SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION OTHERWISE COMPLIES WITH THE ACT. 

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AND RIGHTS OF FIRST REFUSAL, AS SET FORTH IN,
AND SUBJECT TO THE TERMS AND CONDITIONS OF, AN AGREEMENT BETWEEN THE COMPANY AND THE STOCKHOLDER, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY. SUCH TRANSFER RESTRICTIONS, RIGHT OF FIRST REFUSAL AND REPURCHASE OPTION ARE BINDING ON
TRANSFEREES OF THESE SHARES. 
 THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON TRANSFER FOR A PERIOD
NOT TO EXCEED 180 DAYS FOLLOWING THE EFFECTIVE DATE OF THE UNDERWRITTEN PUBLIC OFFERING OF THE COMPANY’S SECURITIES AND MAY NOT BE SOLD OR OTHERWISE DISPOSED OF BY THE HOLDER WITHOUT THE CONSENT OF THE COMPANY OR THE MANAGING UNDERWRITER.

 (b) Stop-Transfer Notices. Purchaser agrees that to ensure compliance with the restrictions referred to herein, the
Company may issue appropriate “stop transfer” instructions to its transfer agent, if any, and that, if the Company transfers its own securities, it may make appropriate notations to the same effect in its own records. 

(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 any purchaser or other transferee to whom such Shares shall have been so
transferred. 
 6. Tax Consequences. The Purchaser has reviewed with the Purchaser’s own tax advisors the federal,
state, local and foreign tax consequences of this investment and the transactions contemplated by this Agreement. The Purchaser is relying solely on such advisors and not on any statements or representations of the Company or any of its agents. The
Purchaser understands that the Purchaser (and not the Company) shall be responsible for any tax liability that may arise as a result of the transactions contemplated by this Agreement. 

7. Section 83(b) Election. The Purchaser understands that Section 83 of the Code, 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 buy back the Shares
pursuant to the Repurchase Option. The Purchaser understands that the Purchaser may elect to be taxed at the time the Shares are purchased rather than when and as the Repurchase Option expires by filing an election under Section 83(b) of the
Code with the IRS within 30 days from the date of purchase. In the case of a Nonstatutory Stock Option, this will result in a recognition of taxable income to the Purchaser on the date of exercise,

  

 -5- 

 
measured by the excess, if any, of the Fair Market Value of the exercised Shares, at the time the Option is exercised over the purchase price for the exercised Shares. Absent such an Election,
taxable income will be measured and recognized by Purchaser at the time or times on which the Company’s Repurchase Option lapses. Purchaser is strongly encouraged to seek the advice of his or her own tax consultants in connection with the
purchase of the Shares and the advisability of filing of the Election under Section 83(b) of the Code. THE FORM FOR MAKING THIS SECTION 83(B) ELECTION IS ATTACHED TO THIS AGREEMENT AS EXHIBIT D AND THE
PURCHASER (AND NOT THE COMPANY OR ANY OF ITS AGENTS) SHALL BE SOLELY RESPONSIBLE FOR APPROPRIATELY FILING SUCH FORM, EVEN IF THE PURCHASER REQUESTS THE COMPANY OR ITS AGENTS TO MAKE THIS FILING ON PURCHASER’S BEHALF. 

8. General Provisions. 

(a) Choice of Law. This Agreement shall be governed by the internal substantive laws, but not the choice of law rules, of
California. 
 (b) Integration. The Plan, the Option Agreement related to the Option and the Notice of Exercise related
to the Option are incorporated herein by reference. The Exercise Notice, the Plan, this Agreement and the Investment Representation Statement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in
their entirety all prior written or oral undertakings and agreements of the Company and Purchaser with respect to the subject matter hereof, including, but not limited to, any representations made during any interviews, relocation discussions or
negotiations whether written or oral, and may not be modified adversely to the Purchaser’s interest except by means of a writing signed by the Company and Purchaser. 

(c) Notices. Any notice, demand, offer, request or other communication required or permitted to be given by either the Company or
the Purchaser pursuant to the terms of this Agreement shall be in writing and shall be deemed effectively given the earlier of (i) when received, (ii) when delivered personally, (iii) 1 business day after being delivered by facsimile
(with receipt of appropriate confirmation), (iv) 1 business day after being deposited with an overnight courier service or (v) 4 days after being deposited in the U.S. mail, First Class with postage prepaid, and addressed to the Purchaser
at the addresses provided to the Company (which the Company agrees to disclose to the other parties upon request) or such other address as a party may request by notifying the other in writing, and to the Company at their respective principal
executive offices. 
 (d) Successors. Any successor to the Company (whether direct or indirect and whether by purchase,
merger, consolidation, liquidation or otherwise) to all or substantially all of the Company’s business and/or assets shall assume the obligations under this Agreement and agree expressly to perform the obligations under this Agreement in the
same manner and to the same extent as the Company would be required to perform such obligations in the absence of a succession. For all purposes under this Agreement, the term “Company” shall include any successor to the Company’s
business and/or assets which executes and delivers the assumption agreement described in this Section or which becomes bound by the terms of this Agreement by operation of law. Subject to the restrictions on transfer set forth in this
Agreement, this Agreement shall be binding upon Purchaser and his heirs, executors, administrators, successors and assigns. 
  

 -6- 

 (e) Assignment. The rights granted to the Purchaser under this Agreement are not
assignable by the Purchaser under any circumstances. 
 (f) Waiver. Either party’s failure to enforce any provision
of this Agreement shall not in any way be construed as a waiver of any such provision, nor prevent that party from thereafter enforcing any other provision of this Agreement. The rights granted both parties hereunder are cumulative and shall not
constitute a waiver of either party’s right to assert any other legal remedy available to it. 
 (g) Purchaser
Investment Representations and Further Documents. In the event the Shares have not been registered under the Securities Act of 1933, as amended, at the time of the purchase of the Shares, the Purchaser shall, if required by the Company,
concurrently with the purchase of all or any portion of the Shares subject to the Option, deliver to the Company his or her Investment Representation Statement in the form attached hereto as Exhibit C. The Purchaser agrees upon request to
execute any further documents or instruments necessary or reasonably desirable in the view of the Company to carry out the purposes or intent of this Agreement, including (but not limited to) Exhibits A, B, C and D of this Agreement.

 (h) 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. 
 (i) Rights as
Stockholder. Subject to the terms and conditions of this Agreement, Purchaser shall have all of the rights of a stockholder of the Company with respect to the Shares from and after the date that Purchaser delivers a fully executed copy of this
Agreement (including all exhibits and attachments thereto) and full payment for the Shares to the Company, and until such time as Purchaser disposes of the Shares in accordance with this Agreement. Upon such transfer, Purchaser shall have no further
rights as a holder of the Shares so purchased except (in the case of a transfer to the Company) the right to receive payment for the Shares so purchased in accordance with the provisions of this Agreement, and Purchaser shall forthwith cause the
certificate(s) evidencing the Shares so purchased to be surrendered to the Company for transfer or cancellation. 
 (j)
Adjustment for Stock Split. All references to the number of Shares and the purchase price of the Shares in this Agreement shall be adjusted in accordance with the terms of the Plan to reflect any stock split, stock dividend or other similar
event affecting the Shares which may be made after the date of this Agreement. 
 (k) Employment at Will. PURCHASER
ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THIS AGREEMENT IS EARNED ONLY BY PURCHASER’S CONTINUOUS SERVICE AT WILL (AND NOT THROUGH THE ACT OF BEING HIRED OR PURCHASING SHARES HEREUNDER). PURCHASER FURTHER ACKNOWLEDGES AND
AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, OR FOR ANY PERIOD AT
ALL, AND SHALL NOT INTERFERE WITH PURCHASER’S RIGHT OR THE COMPANY’S RIGHT TO TERMINATE PURCHASER’S RELATIONSHIP WITH THE COMPANY AT ANY TIME, WITH OR WITHOUT CAUSE OR NOTICE. 

 

 -7- 

 (l) Arbitration. Any and all controversies, claims, or disputes arising out of,
relating to, or resulting from this Agreement shall be subject to binding arbitration under the Arbitration Rules set forth in California Code of Civil Procedure Section 1280 through 1294.2, including section 1283.05 (the
“Rules”) and pursuant to California law. Any arbitration will be administered by the American Arbitration Association (“AAA”) in accordance with its Rules for the Resolution of Commercial Disputes. Purchaser agrees
that the arbitrator shall have the power to decide any motions brought by any party to the arbitration, including motions for summary judgment and/or adjudication and motions to dismiss and demurrers, prior to any arbitration hearing. Purchaser also
agrees that the arbitrator shall have the power to award any remedies, including attorneys’ fees and costs, available under applicable law. Purchaser understands that each party shall bear its own costs and expenses, including attorney’s
fees, incurred in connection with any Arbitration. The decision of the arbitrator shall be in writing. Except as provided by the Rules, arbitration shall be the sole, exclusive and final remedy for any dispute under this Agreement. Accordingly,
except as provided for by the Rules, neither the Purchaser nor the Company will be permitted to pursue court action regarding this Agreement. In addition to the right under the Rules to petition the court for provisional relief, the Purchaser agrees
that any party may also petition the court for injunctive relief where either party alleges or claims a violation of any confidential information or invention assignment agreement between the Purchaser and the Company or any other agreement
regarding trade secrets, confidential information, nonsolicitation or Labor Code §2870. In the event either party seeks injunctive relief, the prevailing party shall be entitled to recover reasonable costs and attorneys fees. 

(m) Representations of Purchaser. Purchaser acknowledges that Purchaser has received, read and understood the Plan, the Option
Agreement and the Notice of Exercise and agrees to abide by and be bound by their terms and conditions. 
 (n)
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. 
  

 -8- 

 The parties represent that they have read this Agreement in its entirety, have had an
opportunity to obtain the advice of counsel prior to executing this Agreement and fully understand this Agreement. The Purchaser agrees to notify the Company of any change in his address below. 

 

					
	PURCHASER	 		 	 PACIFIC BIOSCIENCES OF

CALIFORNIA, INC.

			
	  
	 		 	  

		 		 	Signature
			
		 		 	  

		 		 	Print Name
			
		 		 	  

		 		 	Print Title
			
	Address:	 		 	
			
	  
	 		 	
			
	  
	 		 	

 EXHIBIT A 

STOCK POWER AND ASSIGNMENT 

SEPARATE FROM CERTIFICATE 

FOR VALUE RECEIVED and pursuant to that certain Early Exercise Stock Purchase Agreement dated as of
                    , the undersigned hereby sells, assigns and transfers unto
                                        ,
                                        
(            ) shares of Common Stock of Pacific Biosciences of California, Inc., a Delaware corporation, standing in the undersigned’s name on the books of said corporation
represented by certificate number                      delivered herewith, and does hereby irrevocably constitute and appoint
                     as attorney-in-fact, with full power of substitution, to transfer said stock on the books of said corporation.

 Dated: 
  

	
	  

	(Signature)
	
	  

	(Please Print Name)

 This Assignment
Separate From Certificate was executed in conjunction with the terms of a Early Exercise Stock Purchase Agreement between the above assignor and the above corporation, dated as of
                             , 20    . 

Instruction: Please do not fill in any blanks other than the signature and name lines. 

 EXHIBIT B 

JOINT ESCROW INSTRUCTIONS 
  

 
 Pacific Biosciences of
California, Inc. 
 1380 Willow Road 

Menlo Park, CA 94025 
 Attn: Corporate Secretary

 Dear Secretary: 

Dear                     :

 As Escrow Agent for both Pacific Biosciences of California, Inc. (the “Company”), and the undersigned purchaser of
stock of the Company (the “Purchaser”), you are hereby authorized and directed to hold the documents delivered to you pursuant to the terms of that certain Early Exercise Stock Purchase Agreement (the “Agreement”) between the
Company and the undersigned, in accordance with the following instructions: 
 1. In the event the Company and/or any assignee
of the Company (referred to collectively for convenience herein as the “Company”) exercises the Company’s repurchase option set forth in the Agreement, the Company shall give to Purchaser and you a written notice specifying the number
of shares of stock to be purchased, the purchase price, and the time for a closing hereunder at the principal office of the Company. Purchaser 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 the stock
assignments necessary for the transfer in question, (b) to fill in the number of shares being transferred, and (c) to deliver the stock assignments, together with the certificate evidencing the shares of stock to be transferred, to the
Company or its assignee, against the simultaneous delivery to you of the purchase price (by cash, a check, or some combination thereof) for the number of shares of stock being purchased pursuant to the exercise of the Company’s repurchase
option. 
 3. Purchaser 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 defined in the Agreement. Purchaser does hereby irrevocably constitute and appoint you as Purchaser’s attorney-in-fact and agent for the term of this escrow to execute
with respect to such securities all documents necessary or appropriate to make such securities negotiable and to complete any transaction herein contemplated, including but not limited to the filing with any applicable state blue sky authority of
any required applications for consent to, or notice of transfer of, the securities. Subject to the provisions of this paragraph 3, Purchaser shall exercise all rights and privileges of a stockholder of the Company while the stock is held by
you. 

 4. Upon written request of the Purchaser, but no more than once per calendar year, unless
the Company’s repurchase option has been exercised, you will deliver to Purchaser a certificate or certificates representing so many shares of stock as are not then subject to the Company’s repurchase option. Within 120 days after
cessation of Purchaser’s continuous employment by or services to the Company, or any parent or subsidiary of the Company, you will deliver to Purchaser a certificate or certificates representing the aggregate number of shares held or issued
pursuant to the Agreement and not purchased by the Company or its assignees pursuant to exercise of 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 Purchaser, you shall deliver all of the same to Purchaser 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. 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 Purchaser 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. 
 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, 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, authorities 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 the 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 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. 
  

 -2- 

 12. Your responsibilities as Escrow Agent hereunder shall terminate if you shall cease to be
an officer or agent of the Company or if you shall resign by written notice to each party. In the event of any such termination, the Company shall appoint a successor Escrow Agent. 

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 held by you hereunder, you are authorized and directed to retain in your possession without liability to anyone all or any part of said
securities until such disputes 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 United States Post Office, by registered or certified mail with postage and fees prepaid, addressed to each
of the other parties thereunto entitled at the following addresses or at such other addresses as a party may designate by ten days’ advance written notice to each of the other parties hereto. 

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. 
  

 -3- 

 18. These Joint Escrow Instructions shall be governed by the internal substantive laws, but
not the choice of law rules, of California. 
  

					
	PURCHASER INC.	 		 	PACIFIC BIOSCIENCES OF CALIFORNIA,
			
	  
	 		 	  

	Signature	 		 	By
			
	  
	 		 	  

	Print Name	 		 	Title
			
	  
	 		 	
	  
	 		 	
	Residence Address	 		 	
			
	ESCROW AGENT	 		 	
			
	  
	 		 	
	Corporate Secretary	 		 	
			
	 Dated:                     ,
        
	 		 	

 [SIGNATURE PAGE TO JOINT ESCROW INSTRUCTIONS] 

 

 -4- 

 EXHIBIT C 

INVESTMENT REPRESENTATION STATEMENT 
  

					
	PURCHASER	 	:	 	
			
	COMPANY	 	:	 	Pacific Biosciences of California, Inc.
			
	SECURITY	 	:	 	Common Stock
			
	AMOUNT	 	:	 	
			
	DATE	 	:	 	

  
  

In connection with the purchase of the above-listed shares, I, the undersigned purchaser, represent to the Company as follows:

 1. The Company May Rely on These Representations. I understand that the Company’s sale of the shares to me has
not been registered under the Securities Act of 1933, as amended, because the Company believes, relying in part on my representations in this document, that an exemption from such registration requirement is available for such sale. I understand
that the availability of this exemption depends upon the representations I am making to the Company in this document being true and correct. 

2. I am Purchasing for Investment. I am purchasing the shares solely for investment purposes, and not for further distribution. My
entire legal and beneficial ownership interest in the shares is being purchased and shall be held solely for my account, except to the extent I intend to hold the shares jointly with my spouse. I am not a party to, and do not presently intend to
enter into, any contract or other arrangement with any other person or entity involving the resale, transfer, grant of participation with respect to or other distribution of any of the shares. My investment intent is not limited to my present
intention to hold the shares for the minimum capital gains period specified under any applicable tax law, for a deferred sale, for a specified increase or decrease in the market price of the shares, or for any other fixed period in the future.

 3. I Can Protect My Own Interests. I can properly evaluate the merits and risks of an investment in the shares and can
protect my own interests in this regard, whether by reason of my own business and financial expertise, the business and financial expertise of certain professional advisors unaffiliated with the Company with whom I have consulted, or my preexisting
business or personal relationship with the Company or any of its officers, directors or controlling persons. 
 4. I am
Informed About the Company. I am sufficiently aware of the Company’s business affairs and financial condition to reach an informed and knowledgeable decision to acquire the shares. I have had opportunity to discuss the plans, operations and
financial condition of the Company with its officers, directors or controlling persons, and have received all information I deem appropriate for assessing the risk of an investment in the shares. 

 5. I Recognize My Economic Risk. I realize that the purchase of the shares involves a
high degree of risk, and that the Company’s future prospects are uncertain. I am able to hold the shares indefinitely if required, and am able to bear the loss of my entire investment in the shares. 

6. I Know the Shares are Restricted Securities. I understand that the shares are “restricted securities” in that the
Company’s sale of the shares to me has not been registered under the Securities Act in reliance upon an exemption for non-public offerings. In this regard, I also understand and agree that: 

(a) I must hold the shares indefinitely, unless any subsequent proposed resale by me is registered under the Securities Act, or unless an
exemption from registration is otherwise available (such as Rule 144); 
 (b) the Company is under no obligation to
register any subsequent proposed resale of the shares by me; and 
 (c) 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. 

7. I am Familiar With Rule 144. I am familiar with Rule 144 adopted under the Securities Act, which in some circumstances
permits limited public resales of “restricted securities” like the shares acquired from an issuer in a non-public offering. I understand that my ability to sell the shares under Rule 144 in the future is uncertain, and will depend upon,
among other things: (i) the availability of certain current public information about the Company; (ii) the resale occurring more than one year after my purchase and full payment (within the meaning of Rule 144) for the shares; and
(iii) if I am an affiliate of the Company, or a non-affiliate who has held the shares less than two years after my purchase and full payment: (A) the sale being made through a broker in an unsolicited “broker’s transaction”
or in transactions directly with a market maker, as said term is defined under the Securities Exchange Act of 1934, as amended, (B) the amount of shares being sold during any three month period not exceeding the specified limitations stated in
Rule 144, and (C) timely filing of a notice of proposed sale on Form 144, if applicable. 
 8. I Know Rule
144 May Never be Available. I understand that the requirements of Rule 144 may never be met, and that the shares may never be saleable. I further understand that at the time I wish to sell the shares, there may be no public market for
the Company’s stock upon which to make such a sale, or the current public information requirements of Rule 144 may not be satisfied, either of which would preclude me from selling the shares under Rule 144 even if the one-year minimum
holding period had been satisfied. 
 9. I Know I am Subject to Further Restrictions on Resale. I understand that in the
event Rule 144 is not available to me, any future proposed sale of any of the shares by me will not be possible without prior registration under the Securities Act, compliance with some other registration exemption (which may or may not be
available), or each of the following: (i) my written notice to 
  

 -2- 

 
the Company containing detailed information regarding the proposed sale, (ii) my providing an opinion of my counsel to the effect that such sale will not require registration, and
(iii) the Company notifying me in writing that its counsel concurs in such opinion. I understand that neither the Company nor its counsel is obligated to provide me with any such opinion. I understand that although Rule 144 is not
exclusive, the Staff of the SEC has stated that persons proposing to sell private placement securities other than in a registered offering or pursuant to Rule 144 will have a substantial burden of proof in establishing that an exemption from
registration is available for such offers or sales, and that such persons and their respective brokers who participate in such transactions do so at their own risk. 

10. I Know I May Have Tax Liability Due to the Uncertain Value of the Shares. I understand that the Board of Directors believes
its valuation of the shares represents a fair appraisal of their worth, but that it remains possible that, with the benefit of hindsight, the Internal Revenue Service may successfully assert that the value of the shares on the date of my purchase is
substantially greater than the Board’s appraisal. I understand that any additional value ascribed to the shares by such an IRS determination will constitute ordinary income to me as of the purchase date, and that any additional taxes and
interest due as a result will be my sole responsibility payable only by me, and that the Company need not and will not reimburse me for that tax liability. I understand that if such additional value represents more than 25% of my gross income for
the year in which the value of the shares is taxable, the IRS will have 6 years from the due date for filing the return (or the actual filing date of the return if filed thereafter) within which to assess me the additional tax and interest due.

 11. Residence. The address of my principal residence is set forth on the signature page below. 

By signing below, I acknowledge my agreement with each of the statements contained in this Investment Representation Statement as of the
date first set forth above, and my intent for the Company to rely on such statements in issuing the shares to me. 
  

	
	  

	Name:

  

	
	Address of Purchaser’s Principal Residence:
	
	  

	
	  

  

 -3- 

 IF YOU WISH TO MAKE A SECTION 83(B) 

ELECTION, THE FILING OF SUCH ELECTION 

IS YOUR RESPONSIBILITY. 

THE FORM FOR MAKING THIS SECTION 83(B) ELECTION IS ATTACHED TO THIS AGREEMENT AS EXHIBIT D. 

YOU MUST FILE THIS FORM WITHIN 30 DAYS OF PURCHASING THE SHARES. 

YOU (AND NOT THE COMPANY OR ANY OF ITS AGENTS) SHALL BE SOLELY RESPONSIBLE FOR FILING SUCH FORM WITH THE IRS, EVEN IF
YOU REQUEST THE COMPANY OR ITS AGENTS TO MAKE THIS FILING ON YOUR BEHALF AND EVEN IF THE COMPANY OR ITS AGENTS HAVE PREVIOUSLY MADE THIS FILING ON YOUR BEHALF. 

 The election should be filed by mailing a signed election form by certified mail, return
receipt requested to the IRS Service Center where you file your tax returns. See www.irs.gov. 
  

 -2- 

 EXHIBIT D 

ELECTION UNDER SECTION 83(b) OF THE 

INTERNAL REVENUE CODE OF 1986, AS AMENDED 

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

 

							
	NAME OF TAXPAYER:	 		 	SPOUSE:	 	  

				
	TAXPAYER’S ADDRESS:	 	  
	 		 	
		 	  
	 		 	

  

											
	TAXPAYER ID #:	 	  
	 		 	SPOUSE’S ID #:	 		 	  

2. The property with respect to which the election is made is described as follows: shares (the “Shares”) of the Common
Stock of Pacific Biosciences of California, Inc. (the “Company”). 
 3. The date on which the property was
transferred is:                              ,
20        . 
 4. The property is subject to the following restrictions: The
Shares may be repurchased by the Company, or its assignee, upon the occurrence of certain events. This right lapses with regard to a portion of the Shares over time. 

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: $            .

 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 understand(s) that the foregoing election may not be revoked except with the consent of the Commissioner. 

 

			
	Dated:                     .	 	  

		 	Print Name:                      , Taxpayer

The undersigned spouse of taxpayer joins in this election. 
  

			
	Dated:                     .	 	  

		 	Spouse of Taxpayer

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