Binding Term Sheet between the Company and HealthCor

The New Senior Convertible Note shall bear interest accordingly:

During years 1-5 (the “First Five Year Note Period”), interest will be payable (on a cumulative basis) by the issuance of additional convertible debt (a “PIK”) at an interest rate of 12.5%, compounded quarterly.

During years 6-10 (the “Second Five Year Note Period”), interest may be paid in cash or as a continuation of the cumulative PIK (at the Company’s option), at an annual interest rate of 10.0%, compounded quarterly.

Interest shall be calculated and payable on a quarterly basis in arrears.

Notwithstanding the foregoing, during the existence of an event of default, the then applicable interest rate will be increased by 5%.

Same as the Existing Notes ((i.e., two ‘five-year’ periods), with the following exception:

The New Senior Convertible Note will include the following language and the last sentence of Section 2(d)(i) of each of the Existing Notes will

be amended and restated in its entirety to read as follows:

“For purposes of this Note, the term “Major Event” shall mean the occurrence of (i) the signing of a definitive agreement or a series of agreements for the transfer, sale, lease or license of all or substantially all of the Company’s assets or capital securities; (ii) the signing of a definitive agreement to consolidate or merge with or into another Person (whether or not the Company is the Successor Entity) that results or would result, after giving effect to the consummation of the transactions contemplated by such agreement, in such other Person (or the holders of such other Person’s capital stock immediately prior to the transaction) (other than the Holder or its Affiliates) being or becoming the beneficial owner (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of thirty-five percent (35%) or more of any class of the Company’s or the Successor Entity’s outstanding capital securities; (iii) the signing of a definitive agreement or a series of agreements to consummate a stock acquisition or sale or other business combination (including, without limitation, a reorganization, recapitalization, or spin-off), or series thereof, with any other Person or Persons (other than the Holder or its Affiliates) that results or would result, after giving effect to the consummation of the transactions contemplated by such agreement or agreements, in such other Person or Persons being or becoming the beneficial owner (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of thirty-five percent (35%) or more of any class of the Company’s outstanding capital securities; (iv) the commencement or other public announcement by any Person (other than the Company, the Holder or the Holder’s Affiliates) of a purchase, tender or exchange offer for 35% or more of the outstanding shares of Common Stock (not including any shares of Common Stock held by the Person or Persons making or party to, or associated or affiliated with the Persons making or party to, such purchase, tender or exchange offer); (v) any “person” or “group” (as these terms are used for purposes of Sections 13(d) and 14(d) of the Exchange Act) (other than the Holder or its Affiliates) is or shall become the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of either (x) 35% or more of the aggregate ordinary voting power represented by issued and outstanding Common Stock or (y) 35% or more of the aggregate ordinary voting power represented by issued and outstanding Common Stock not held by the such Person or Persons as of the date hereof; or (vi) the public announcement by any Person, Persons or group (other than the Company, the Holder or the Holder’s Affiliates) of a bona fide intention to enter into any of the agreements or to engage in or commence any of the actions described in clauses (i) through (v) above, or otherwise reflecting an intent to acquire the Company or all or substantially all of its assets or capital securities, or the public announcement by the Company of its receipt of a communication from such a Person, Persons or group

evidencing the same.”

HCP will have the right, at any time, and at its sole discretion, to convert, in whole or in part, the principal and accumulated accrued interest of the New Senior Convertible Note into common stock of the Company.

The conversion price the New Senior Convertible Note shall be equal to $0.40..

The Company shall issue HCP a warrant to purchase 4,000,000 shares. The actual number of shares will be subject to final adjustments, based on the Company’s stock price at the time of Closing, but in no event will be less than 4,000,000.

The strike price of this warrant shall be equal to $0.40.

The term of the warrant shall be 10 years and shall include cashless exercise provisions.