10.    Subsequent Event

On August 14, 2012, the Company entered into a two year Interim Revenue Interest Purchase Agreement (the “Interim Royalty Contract”) with PDL BioPharma, Inc. (“PDL”), pursuant to which PDL paid the Company $1,750,000 in exchange for the purchase of specified “Acquired Revenues,” from the Company in an amount equal to the following: (i) during the period from August 1, 2012 to December 31, 2012, 3% of the Company’s Net Revenues per month, and (ii) during the period from January 1, 2013 to August 31, 2014, the greater of 5% of the Company’s Net Revenues or $112,257 per month. The Company shall repurchase the Acquired Revenues and terminate the Interim Royalty Contract at any time, in the event the Company (i) receives equity or debt financing in an aggregate amount greater than $5,000,000 from an investor(s) other than PDL, or (ii) experiences a change in control (as defined in the Interim Royalty Contract). Upon repurchase of the Acquired Revenues in such circumstances, the Company is required to pay PDL the outstanding balance under the Interim Royalty Contract as of the payment date, any accrued but unpaid Acquired Revenues through the payment date, and a $150,000 fee.

In addition, on August 14, 2012, the Company and MidCap entered into an amendment to the MidCap Loan, under which (i) the lenders to the MidCap Loan consented to the Company’s entry into the Interim Royalty Contract, and (ii) the parties agreed that PDL’s rights in the Acquired Revenues under the Interim Royalty Contract are subordinated to the MidCap Loan.