**EXHIBIT99**

**CAUTIONARY STATEMENT**

*MedicalCV,Inc., or persons acting on our behalf, or outside reviewers retained by usmaking statements on our behalf, or underwriters of our securities, from timeto time, may make, in writing or orally, "forward-looking statements"as defined under the Private Securities Litigation Reform Act of 1995 (the"Litigation Reform Act"). This Cautionary Statement, when used in conjunction with an identifiedforward-looking statement, is for the purpose of qualifying for the "safeharbor" provisions of the Litigation Reform Act and is intended to be areadily available written document that contains factors that could causeresults to differ materially from such forward-looking statements.  These factors are in addition to any othercautionary statements, written or oral, which may be made, or referred to, inconnection with any such forward-looking statement.*

*Thefollowing matters, among others, may have a material adverse effect on ourbusiness, financial condition, liquidity, results of operations or prospects,financial or otherwise.  Reference tothis Cautionary Statement in the context of a forward-looking statement orstatements shall be deemed to be a statement that any one or more of thefollowing factors may cause actual results to differ materially from those insuch forward-looking statement or statements.*

***Risks related to our business***

**Weanticipate future losses and negative cash flows, which may limit or delay ourability to become profitable.**  We haveincurred losses in each of the last five fiscal years.  We had net losses of $3,238,829 for the yearended April 30, 2001 and $3,544,453 for the year ended April 30, 2000.  We had a net loss of $1,559,268 for the sixmonths ended October 31, 2001.  As ofOctober 31, 2001, we had an accumulated deficit of $9,666,989.  We depend upon the proceeds of our initialpublic offering or other financing to meet our future working capital andcapital expenditure needs and to maintain compliance with our debtcovenants.  If we fail to obtainfinancing when required, we may not be able to develop or enhance our products,gain market share in the U.S. or respond to competitive pressures orunanticipated requirements, which could seriously harm our business, financialposition and results of operations.  Weexpect to incur additional net losses until we are able to generate and sustainsubstantially higher revenues while maintaining reasonable expense levels, bothof which involve uncertainty.  We alsomust continue to make significant expenditures on research and development inconnection with our heart valves.  Wecannot assure you that our revenues will grow in future periods or that we willever become profitable.  If we doachieve profitability, we cannot assure you that we would be able to sustain orincrease profitability on a quarterly or annual basis in the future.

**We relyupon sales of our Omnicarbon heart valves for substantially all of our revenue.** Our results of operations materially depend on the success of theOmnicarbon 3000 and 4000 heart valves, which accounted for substantially all ofour operating revenue for the fiscal year ended April 30, 2001 and the sixmonths ended October 31, 2001.  Asignificant reduction in sales of Omnicarbon heart valves for any reason,including the introduction of additional competing products, would have amaterial adverse effect on us.  If wedevelop additional products, we would need to obtain regulatory approval beforewe could sell them.  Given thetime-consuming nature of the regulatory clearance process, we do not expect tobe able to sell such additional products in the foreseeable future.  We also anticipate that research anddevelopment and clinical and regulatory expenses will continue to rise infuture periods.

**Wecannot assure you that our heart valves will gain physician acceptance.** Alimited number of cardiovascular surgeons and cardiologists can influencemedical device selection and purchase decisions for a large portion of thetarget cardiovascular surgery patient population.  We cannot assure you that our Omnicarbon heart valves, or any ofthe products that we may develop, will gain any significant degree of physicianacceptance, or that users will accept these products as preferable toalternative products or methods of treatment. Physician acceptance of our Omnicarbon heart valves will depend upon ourability to demonstrate the clinical advantages of lower complication rates andcost-effectiveness of Omnicarbon heart valves when compared to other prostheticheart valves.  Negative publicityinvolving Omnicarbon heart valves or other prosthetic heart valves couldadversely affect the overall acceptance of Omnicarbon heart valves.  Further, because Omnicarbon heart valves aremonoleaflet heart valves, we must overcome in the U.S. and in other markets apreference for bileaflet heart valves, which are marketed by most majormanufacturers of mechanical heart valves. Any of the foregoing factors, among others, could limit or detract fromphysician acceptance of our product and have a negative effect on our business,financial condition, operating results and cash flows.

**Becausewe do not have FDA clearance to manufacture our Omnicarbon 3000 heart valvesusing our own pyrolytic carbon process for sale in the U.S., we depend upon athird party supplier for critical components.**  We market ourOmnicarbon 3000 heart valves, which we have now begun to sell in the U.S. andJapan, with pyrolytic carbon components produced by Sulzer Carbomedics, a thirdparty supplier which sells competing heart valves.  We have a supply contract that requires us to purchase suchcomponents for use in the Omnicarbon 3000 heart valve solely from SulzerCarbomedics until December 2003.  Giventhe absence of FDA-cleared alternative sources for pyrolytic carbon componentsfor our Omnicarbon 3000 heart valves, any disruption or termination of oursupply contract, or our failure to extend it, if necessary, would have amaterial adverse effect on our continued ability to sell Omnicarbon 3000 heartvalves.  Future purchase shortfallscould adversely affect our ongoing relationship with Sulzer Carbomedics.  Further, we cannot assure you that we willbe able to obtain FDA clearance to manufacture Omnicarbon heart valves for salein the U.S. using our own pyrolytic carbon process.  Our future success will depend, in part, on obtaining FDAclearance to manufacture carbon components for heart valves for sale in theU.S.

**We mayneed to fund multiple research studies throughout the lifecycle of each of ourproducts, providing statistically significant scientific data to regulatoryagencies and cost effectiveness data to third party payers.** The FDA, foreign regulatory agencies and third party health care payersmay require scientific clinical outcomes data and cost effectiveness data.  We will need to provide this data throughoutour products' lifecycles.  Payers andgovernmental agencies may change the frequency and breadth of clinical researchrequired, potentially significantly increasing our costs.  Without adequate positive outcomes data thatdemonstrate advantages from the use of our Omnicarbon heart valves, we may notachieve any significant market penetration. We cannot assure you that our outcomes data will be adequate to meetpresent or future medical device utility requirements.  If our outcomes data does not meet suchrequirements, we may be unable to sell our products or obtain third partyreimbursement for the costs of our products.

**Intensecompetition in the prosthetic heart valve industry could prevent us from successfullymarketing our products or render our products obsolete.** We compete in mature, highly competitive markets in which many of ourcompetitors have well-known and established products.  To compete successfully in these markets, we must maintaincompetitive pricing and demonstrate the advantages of our Omnicarbon heartvalves in terms of post-surgical complications.  Several companies are currently pursuing new mechanical heartvalve designs, blood compatible coatings for mechanical heart valves, longer lastingtissue heart valves and surgical alternatives to implanting prosthetic heartvalves.  It is possible thattechnological advances by our competitors, or advances in surgical proceduresthat delay the need for replacing heart valves, could render our Omnicarbonheart valves noncompetitive or obsolete.

Our primary competitors, St. Jude Medical, Inc.,Medtronic, Inc. and Sulzer Carbomedics, dominate the market and control most ofthe mechanical heart valve market worldwide. Our competitors have extensive clinical data demonstrating theperformance of their heart valves and internal carbon manufacturingcapabilities.  The companies with whichwe compete have many additional competitive advantages over us, including:

·                                          greater name recognition and productmarket acceptance;

·                                          more established physician relationships;

·                                          broader product lines;

·                                          greater distribution capabilities;

·                                          greater regulatory compliancecapabilities;

·                                          larger marketing, research anddevelopment staffs and facilities; and

·                                          greater financial resources.

We cannot assure you that we will be able to competeagainst such competitors or their products.

**Ourfuture results depend upon the strength of the mechanical heart valve market.** Our business could suffer if the use of mechanical heart valvesdeclines.  In recent years, there hasbeen an increase in the number of tissue heart valves used.  We believe that improvements in tissue heartvalve longevity and an increase in the average age of heart valve patients havecontributed to the recent increase in the use of tissue heart valves.  If the use of mechanical heart valvesdeclines, it could materially adversely affect our business, financialcondition, operating results and cash flows.

**Thesmall number of distributors operating in foreign markets that currentlygenerate substantially all of our revenues pose a concentration of credit riskand could leave us at any time, impairing our business.** Substantially all of our sales originate from eight distributors whomarket our Omnicarbon 4000 heart valves in Europe, South Asia, the Middle Eastand the Far East.  Because we do notcontrol the amount or timing of the resources such parties allocate to sales ofour product, any revenues we derive from such relationships depend upon theefforts of such distributors.  If wecould not locate a replacement on a timely basis, the loss of an internationaldistributor could adversely affect us.

Certain of our significant international distributorsare affiliates of our company.  Duringour fiscal year ended April 30, 2001, such affiliates made net purchases ofproduct from our company equal to approximately 45.5% of our net sales.  During our fiscal year ended April 30, 2000,such affiliates made net purchases of product from our company equal toapproximately 58.8% of our net sales. Obligations to us from our distributors are unsecured.  Such affiliates could fail to payreceivables or cease distributing our products at any time, thereby materiallyand adversely affecting our business, financial condition, operating resultsand cash flows.

**Wedepend upon sales outside the U.S., which are subject to a number of risks thatcould harm our ability to successfully commercialize our product and could harmour business.**  We face several risks as a result of doing businessin foreign markets, including:

·                                          unforeseen changes in regulatoryrequirements and government health programs;

·                                          potentially adverse tax consequences;

·                                          political and economic instability; and

·                                          greater difficulty in collecting paymentsfrom product sales.

In addition, the value of the U.S. dollar in relationto other currencies may also harm our sales to customers outside the U.S.because we require substantially all of our customers to pay for our productsin U.S. currency.

**We maybe unable to fund our significant future capital needs, and we may needadditional funds sooner than anticipated.**  Based on ourcurrent rate of expenditures, anticipated net sales and current research anddevelopment plans, we estimate that the proceeds from our initial publicoffering, together with amounts available under our bank line of credit,assuming such line of credit is refinanced to a long-term mortgage in fiscalyear 2003, will be sufficient to fund our operating needs, capital expendituresand working capital requirements through fiscal year 2003.  The timing and amount of our future capitalrequirements, however, will depend on a number of factors, including:

·                                         the extent to which our Omnicarbon 3000heart valve gains market acceptance in the U.S.;

·                                         costs of manufacturing and marketing;

·                                          potential reductions in heart valvepricing by our competitors;

·                                          costs of licensing and acquiring newproducts and technologies;

·                                         time and costs involved in obtainingregulatory clearance for our pyrolytic carbon coating process for sales in theU.S. of our Omnicarbon 4000 heart valve and other unanticipated regulatorycosts;

·                                         costs involved in filing, prosecuting andenforcing patents or defending against any patent infringement claims;

·                                         competing technological and marketdevelopments; and

·                                         progress and cost of clinical trials fornew products.

In any event, we will require additional capital tosupport future operations, to complete the development of products and tomanufacture and market any products resulting from current developmentprojects.  We cannot assure you thatsuch additional financing will be available on acceptable terms, or atall.  If funds are raised by issuingadditional equity securities, our then existing shareholders will experiencefurther dilution.  If we are unable toobtain additional funds as needed, we may not be able to:

·                                          develop or enhance our products,

·                                          gain market share in the U.S., or

·                                          respond to competitive pressures orunanticipated requirements.

**Substantialgovernment regulation in the U.S. and abroad may restrict our ability to sellour heart valves.**  The FDA and comparable regulatoryauthorities in foreign countries extensively and rigorously regulate ourproducts, product development activities and manufacturing processes.  In the U.S., the FDA regulates theintroduction of medical devices as well as the manufacturing, labeling andrecord-keeping procedures for such products. We are required to:

·                                          obtain clearance before we can market andsell medical devices;

·                                          satisfy content requirements applicableto our labeling, sales and promotional materials;

·                                          comply with manufacturing and reportingrequirements; and

·                                          undergo rigorous inspections.

The process of obtaining marketing clearance for newmedical devices from the FDA can be costly and time consuming.  For example, the premarket clearanceprocess, which our medical devices must undergo, can require a number of yearsto complete.  Although we recently obtainedFDA clearance for our Omnicarbon 3000 heart valve, we cannot assure you thatour future products will obtain FDA clearance on a timely basis, or atall.  Our products must also comply withlaws and regulations of foreign countries in which we market such products.  In general, the extent and complexity ofmedical device regulation is increasing worldwide.  This trend may continue, and the cost and time required to obtainmarketing clearance in any given country may increase as a result.  We cannot assure you that our products willobtain any necessary foreign clearances on a timely basis, or at all.

**Oncemedical devices are cleared for sale, regulatory authorities may still limitthe use of such products, restrict sales to certain models or sizes, preventthe sale or manufacture of such products or require a recall or withdrawal ofsuch products from the marketplace.**  Followinginitial clearance from regulatory authorities, we continue to be subject toextensive regulatory requirements. Government authorities can withdraw marketing clearance due to ourfailure to comply with regulatory standards or due to the occurrence ofunforeseen problems following initial clearance.  Ongoing regulatory requirements are wide-ranging and govern,among other things:

·                                          annual inspections to retain CE mark forsale of products in the European Union;

·                                          product manufacturing;

·                                          annual inspections to retain ISOcertification of our quality system;

·                                          supplier substitution;

·                                          product changes;

·                                          process modifications;

·                                          medical device reporting; and

·                                          product sales and distribution.

The FDA and various government agencies inspect ourfacilities from time to time to determine whether we are in compliance withapplicable laws and regulations.  If wefail to comply or maintain compliance with medical device laws or regulations,regulatory authorities may fine us and bar us from selling our products.  If the FDA believes we are not in compliancewith such laws or regulations, it can:

·                                          seize our products;

·                                          require a recall;

·                                          withdraw previously granted marketclearances;

·                                          implement procedures to stop futureviolations; and/or

·                                          seek civil and criminal penalties againstus.

**Theuncertainty of third party reimbursements and possible health care reforms mayadversely affect us. **Our ability to market productssuccessfully in the U.S. will depend in part on the extent to whichreimbursement for the cost of such products and related treatment will beavailable from government health administration authorities, private healthinsurers, health maintenance organizations and other third party payers.  Payers increasingly challenge the need for,and prices of, medical products and services. Payers may deny reimbursement for procedures that they deem experimentalor for devices used in ways other than as cleared by the FDA or stated in theirindications for use.  With respect toour products, some payers could deny coverage until the devices becomegenerally accepted by the medical profession. The inability of hospitals and other providers to obtain reimbursementfrom third party payers for our products would have a material adverse impacton our business, financial condition, operating results and cash flows.

Health care reform may also impact sales of newproducts in the U.S.  Reforms mayinclude:

·                                         mandated basic health care benefits;

·                                         controls on health care spending throughlimiting the growth of private health insurance premiums and Medicare andMedicaid spending; and

·                                         fundamental changes to the health caredelivery system.

We anticipate that Congress and state legislatureswill continue to review and assess alternative health care delivery systems andpayment methodologies, and that public debate of these issues will likelycontinue in the future.  Due touncertainties regarding the ultimate features of reform initiatives and theirenactment and implementation, we cannot predict which, if any, of such reformproposals will be adopted, when they may be adopted or what impact they mayhave on our ability to market our current and future products.  Laws resulting from such reform initiativescould adversely impact our business, financial condition, operating results andcash flows.

**Despiteour efforts to protect our proprietary rights, unauthorized parties may attemptto use information that we regard as proprietary.  We also run the risk of infringing the proprietary rights ofthird parties.**  We do not have patent protection for thedesign of our Omnicarbon heart valves. We rely upon a combination of trade secrets, know-how andconfidentiality agreements to protect the proprietary aspects of ourtechnology, including aspects of manufacturing.  We have patent applications filed for the pyrolytic carboncoating process used in our Omnicarbon 4000 heart valve.  We have patents for our bileaflet mechanicalheart valve project that is currently under development.  We expect to seek patent protection foradditional products in the future.  Oursuccess will depend, in part, on our ability to protect our products and tomanufacture and sell them without infringing the rights of third parties.  The validity and breadth of claims coveredin medical technology patents involve complex legal and factual questions and,therefore, are highly uncertain.  Inaddition, the laws of many countries do not protect our proprietary rights toas great an extent as do the laws of the U.S. We cannot assure you that:

·                                        any pending patent applications or anyfuture patent applications will result in the issuance of patents;

·                                        the scope of any patent protection willbe effective to exclude competitors or to provide competitive advantages to us;

·                                        we will be able to commercially exploitany issued patents before they expire;

·                                        any of our patents will be held valid ifsubsequently challenged;

·                                        others will not claim rights in, orownership of, the patents and other proprietary rights we hold;

·                                        our products and processes will notinfringe, or be alleged to infringe, the proprietary rights of others; or

·                                        we will be able to protect meaningfulrights in proprietary technology over which we do not hold patents.

Furthermore, we cannot assure you that others have notdeveloped or will not develop products that may duplicate any of our productsor manufacturing processes, or that others will not design around ourpatents.  Other parties mayindependently develop or otherwise acquire substantially equivalent techniques,gain access to our proprietary technology or disclose such technology.  In addition, whether or not we obtainadditional patents, others may hold or receive patents covering components ofproducts we independently develop in the future.  We cannot assure you that third parties will not claiminfringement by us, and seek substantial damages, with respect to current orfuture products.  If we were to becomeinvolved in a dispute regarding intellectual property, whether ours or that ofanother company, we may be involved in legal proceedings.  Any such claims, with or without merit,could be time-consuming, result in costly litigation, cause product shipmentdelays and require us to:

·                                          cease manufacturing and selling ourproduct, which would seriously harm us;

·                                          enter into royalty or licensingagreements; or

·                                          design commercially acceptablenon-infringing alternative products.

We cannot assureyou that we would be able to obtain royalty or licensing agreements, ifrequired, on terms acceptable to us or at all, or that we would be able todevelop commercially acceptable non-infringing alternative products.  Our failure to do so could have a materialadverse effect upon our business, financial condition, operating results andcash flows.

**Ifpatients allege that the use of Omnicarbon heart valves adversely affectedthem, we may face substantial product liability claims.** Substantial product liability litigation exists within the medicaldevice industry.  Mechanical heartvalves are life-sustaining devices, and their failure may result in patientdeath.  We have had product liabilityclaims in the past, which have been resolved without material financial cost tous.  We cannot assure you, however, thatfuture product liability claims will not exceed the limits of our insurancecoverage or that such insurance will continue to be available on commerciallyreasonable terms, or at all. Consequently, a product liability claim or other claim with respect touninsured liabilities, or in excess of insured liabilities, could have amaterial adverse effect on our business, financial condition, operating resultsand cash flows.  In addition, adversepublicity resulting from product liability litigation may materially adversely affectus regardless of whether the claims are valid or whether we are liable.  These claims may divert our financial andmanagement resources that would otherwise be used to benefit the futureperformance of our operations.

**Keyemployees could leave our company at any time, impairing our development andprofitability**.  We depend heavily on the technical knowledgeand industry expertise of our management team and our founder and former chiefexecutive officer, Adel A. Mikhail, Ph.D., with whom we have a two-yearconsulting agreement.  The developmentand execution of our business plan depends upon these individuals.   We do not have employment agreements withmost of our key employees.  Thedeparture of key people could adversely affect our business, financialcondition, operating results and cash flows.

**We maybe unable to recruit, motivate and retain qualified employees.** Our success depends upon our ability to attract, motivate and retain asufficient number of qualified employees, including those who concentrate inresearch and development, sales, marketing and manufacturing, to keep pace withour product development schedules.  Eventhough we have not experienced shortages of qualified people to date, qualifiedindividuals needed to fill these positions could be in short supply in ourmarket.  Our inability to recruit,motivate and retain such individuals may delay the planned launch of newproducts or result in high employee turnover, either of which could have amaterial adverse effect on our business, financial condition, operating resultsand cash flows.  Additionally,competition for qualified employees could require us to pay higher wages andprovide additional benefits to attract sufficient employees.

**We maybe unable to collect on our loan to UROPACE, Inc. **InJuly 1995, we established a wholly owned subsidiary called UROPACE, Inc.  On November 1, 2000, we completed a spin-offof UROPACE to our existing shareholders. As part of this spin-off, we agreed to loan UROPACE up to $356,250 at avariable interest rate.  As of October31, 2001, we had loaned UROPACE $195,000. Principal and interest on the note is payable in installments equal to5% of UROPACE's future annual net sales until the note is paid in full.  Due to the development stage of UROPACE, itis uncertain whether we will be able to collect on this loan.  For financial reporting purposes, we haverecorded an allowance for the entire balance of the loan at October 31, 2001.

***Risks related to oursecurities***

**Fluctuationsin our operating results may result in decreases in the price of oursecurities.**  Our operating results have and will continueto fluctuate significantly because of several factors, including the timing ofFDA clearance, government policies regarding payment for our products and newtechnology.  Consequently, our operatingresults may fall below the expectations of public market analysts andinvestors.  In that event, the price ofour securities would likely decrease.

**Nopublic market exists for our common stock or Class A Warrants, and an activemarket may not develop for our units.**  No publicmarket exists for our common stock or Class A Warrants.  Such a market may not exist until at leastMay 20, 2003, when the unit components may be traded separately.  We cannot assure you that an active marketfor such securities will develop in the future or that an active market for ourunits will develop.  Before our initialpublic offering, there was no public market for our units.  As a result, we arbitrarily established theoffering price for the units and the exercise price of the Class A Warrantsthrough negotiations with our underwriter. Such prices were not based upon our assets, earnings history or bookvalue.

**If we donot maintain our Nasdaq listing, you may have difficulty reselling your units.** We will need to maintain certain financial and corporate governancequalifications to keep our units listed on The Nasdaq SmallCap Market and toobtain listing for our common stock and Class A Warrants.  We cannot assure you that we will at alltimes meet the criteria for continued or initial listing.  If we fail to maintain such qualifications,including a minimum bid price for our units of $1.00, our units may be delistedand our common stock and Class A Warrants may not become listed.  In the event of delisting or failure to list,trading, if any, would be conducted in the over-the-counter markets in theso-called "pink sheets" or the National Association of SecuritiesDealers, Inc. "Electronic Bulletin Board."  At that point, our securities would become subject to the SEC's"penny stock rules."  Thepenny stock rules would impose additional requirements on broker-dealers whoeffect trades in our securities other than trades with their establishedcustomers and accredited investors. Consequently, the delisting or failure to list our securities and theapplicability of the penny stock rules may adversely affect the ability ofbroker-dealers to sell our securities, which may adversely affect your abilityto resell our securities.  If any of theseevents take place, you may not be able to sell as many securities as youdesire, you may experience delays in the execution of your transactions and oursecurities may trade at a lower market price than they otherwise would.

**Ourexisting shareholders have significant control, which could reduce your abilityto receive a premium for your securities through a change in control.** Officers and directors of our company beneficially own 37.5% of ourshares of common stock.  As a result,they may be able to control our company and direct our affairs, including theelection of directors and approval of significant corporate transactions.  This concentration of ownership could alsodelay, defer or prevent a change in control of our company, and make sometransactions more difficult or impossible without their support.  These transactions might include proxycontests, tender offers, open market purchase programs or other share purchasesthat could give our shareholders the opportunity to realize a premium over thethen prevailing market price of our securities.  As a result, this concentration of ownership could depress theprice of our securities.

**Minnesotalaw and our ability to issue preferred stock could deter a take-over oracquisition of our company**.  Our articlesof incorporation authorize the issuance of shares of preferred stock.  Our board of directors, without any actionby our shareholders, is authorized to designate and issue the preferred stockin such classes or series as it deems appropriate and establish the rights andprivileges of such shares, including liquidation and voting rights.  Our ability to designate and issue preferredstock having preferential rights over our common stock could adversely affectthe voting power and other rights of holders of common stock, should wedetermine to issue preferred stock.  Weare also subject to the Minnesota Business Corporation Act, which includesprovisions that limit the voting rights of persons acquiring specifiedpercentages of shares of an issuing public corporation in a "control shareacquisition" and restrict "business combinations" betweenissuing public corporations and specified persons acquiring theirsecurities.  Our ability to issuepreferred stock and the application of the provisions of Minnesota lawdiscussed above could impede or deter another company from making a tenderoffer or other proposal to take us over.

**We mayredeem the Class A Warrants at a nominal price. **Wemay redeem the Class A Warrants at $0.01 per warrant at any time once theybecome exercisable, upon ten business days' notice, if the closing price of ourcommon stock or units exceeds $8.50, subject to customary anti-dilutionadjustments, for any ten consecutive trading days before such notice.  If we redeem the Class A Warrants, you willlose your right to exercise the Class A Warrants except during the ten-businessday notice period.  Our redemption ofthe Class A Warrants could force you to exercise the Class A Warrants at a timewhen it may be disadvantageous for you to do so, to sell the Class A Warrantsat the then current market price or to accept the redemption price, which couldbe substantially less than the market value of the Class A Warrants at the timeof redemption.

**If we donot maintain an effective prospectus, you will be unable to exercise your ClassA Warrants.**  You will be able to exercise the Class AWarrants, and we will be able to issue shares to you upon such exercise, onlyif a current prospectus relating to the shares underlying the Class A Warrantsis then in effect and only if such securities are qualified for sale or exemptfrom qualification under the applicable securities laws of the state in whichyou reside.  Although we cannot assureyou that we will actually be able to do so, we will use our best efforts to:

·                                         maintainthe effectiveness of a current prospectus covering the shares underlying theClass A Warrants, and

·                                         maintainthe registration of such shares under the securities laws of the states inwhich we initially qualified the units for sale in our initial public offering.

**We have broaddiscretion to use the proceeds from our initial public offering for purposeswith which you may not agree, and we may not be successful in investing theproceeds.**  We plan to use the proceeds from our initialpublic offering for general corporate purposes including, but not limited to,marketing, developing various medical devices and, potentially, licensingtechnology from third parties.  Theamounts actually expended for the above purposes may vary significantlydepending upon a number of factors.  Therefore,we will have broad discretion as to how we will spend the proceeds.  Shareholders may not agree with the ways inwhich we use the proceeds and our management may not make the best use of theproceeds.  We cannot predict whether ourmanagement's investment of the proceeds will yield a favorable, or any, return.