TERM NOTE PACIFIC BIOMETRICS, INC

TERM NOTE

PACIFIC BIOMETRICS, INC.

$4,000,000.00 Seattle, Washington

September 1, 2009

FOR VALUE RECEIVED, Pacific Biometrics, Inc., a Delaware corporation (the “ Company ”), promises to pay to Terry M. Giles (“ Lender ”) or its registered assigns, the principal amount of $4,000,000.00, plus accrued and unpaid interest on this Note, pursuant to that certain Loan and Security Agreement dated of even date herewith between the Company and Lender (the “ Loan Agreement ”).

This Note is issued in connection with the Term Loan made pursuant to, and is entitled to the benefits of, the Loan Agreement, to which reference is hereby made for a more complete statement of the rights and obligations of the Lender and the duties and obligations of the Company under which the Term Loan evidenced hereby is made and is to be repaid. Capitalized terms used in this Note without being defined shall have their respective meanings as set forth in the Loan Agreement.

Principal of and interes