Exhibit 10.49

                              INTRAOP MEDICAL, INC.



October 29, 2008



Mr. Howard Solovei


Re:      Separation and General Release Agreement

Dear Howard:

This letter sets forth the terms of the separation and general release agreement
(the "Agreement") between you and Intraop Medical, Inc. (the "Company").

1.  Separation.  Your  last day of work  with the  Company  and your  employment
termination date will be October 31, 2008 (the "Separation  Date").  Between the
date  listed  above and the  Separation  Date,  you will  continue  to work on a
full-time basis, performing your regular and customary duties and all such other
duties that may be reasonably assigned to you. You will continue to abide by all
Company  policies and procedures for the remainder of your  employment  with the
Company.

2. Accrued Salary and Vacation. On the Separation Date, the Company will pay you
all accrued base salary and all accrued and unused  vacation  earned through the
Separation Date,  subject to standard payroll  deductions and withholdings.  You
are  entitled  to these  payments  regardless  of  whether  or not you sign this
Agreement.

3. Expense  Reimbursements.  Within five (5) business days after the  Separation
Date,  you agree to submit  to the  Company  your  final  expense  reimbursement
statement reflecting all remaining business expenses incurred by you through the
Separation Date for which you seek reimbursement. The Company will reimburse all
reasonable   documented  business  expenses  incurred  in  accordance  with  its
governing expense reimbursement policies and procedures.

4. Severance Benefits. This termination of your employment is a "separation from
service" (within the meaning of Treasury  Regulations Section  1.409A-1(h)).  In
exchange  for your  entering  into and  abiding by the terms of this  Agreement,
after the  Separation  Date,  the Company  will  provide you with the  severance
benefits described below.

     (a) Cash Severance.  The Company will pay you cash severance equal to up to
10 months of your last base  salary,  less  applicable  payroll  deductions  and
withholdings  (the  "Severance"),  subject  to offset as  described  below.  The
Severance will be paid in the form of continuing base salary  payments,  paid on
the  Company's  customary  payroll pay dates  starting on the first  practicable
payroll  pay date after the  Effective  Date (as defined in  paragraph  13 (ADEA
Waiver)  below).  On such first  payroll pay date,  the Company will pay you the
amount of the  Severance  that  would  have been paid to you on or prior to such
date in the ordinary course had the commencement of the payment of the Severance
not been delayed pending the  effectiveness of this Agreement,  with the balance
of the Severance  payable  thereafter on the Company's regular payroll schedule,
so that the  Severance is paid not later than the date that is the first regular
payroll pay date on or after August 31, 2009. The Severance  shall be reduced by
the  amount of any and all cash  compensation  paid or  payable  to you for work
performed (whether as a self-employed  person or as an employee or consultant of
any  person  or  entity)  during  the 10  month  period  immediately  after  the
Separation  Date (the  "Severance  Period").  You agree to notify the Company in
writing  (sent to the attention of the Company's  Chief  Executive  Officer (the
"CEO"))  no later  than five (5) days after you  commence  any work  engagements
during the Severance Period, including the amount of compensation payable to you
for such work.

     (b) Paid COBRA  Premiums.  To the extent  provided by the federal COBRA law
or, if applicable,  state  insurance  laws,  and by the Company's  current group
health  insurance  policies,  you will be eligible to continue your group health
insurance  benefits after the Separation Date at your own expense.  (Later,  you
may be able to convert to an  individual  policy  through  the  provider  of the
Company's health  insurance,  if you wish.) If you timely elect to continue your
group health insurance coverage pursuant to COBRA, as part of this Agreement and
as an  additional  severance  benefit,  the Company  will pay on your behalf the
COBRA  premiums  necessary to continue  your current  level of health  insurance
coverage (for yourself and any covered  dependents)  in effect until the earlier
of the last day of the Severance Period or until such earlier date as either (i)
you become eligible for health insurance benefits through a subsequent  employer
or (ii) you and your covered dependents cease to be eligible for COBRA coverage.
You agree to notify the Company in writing (sent to the attention of the CEO) no
later  than five (5) days  after you  become  eligible  for  benefits  through a
subsequent employer.

<PAGE>

     (c) Compliance  with Section 409A. It is intended that each  installment of
the  payments  and benefits  provided  for in this  paragraph 4 (the  "Severance
Benefits") is a separate  "payment" for purposes of Treasury  Regulation Section
1.409A-2(b)(2)(i).  For the avoidance of doubt,  it is intended that payments of
the  amounts  set forth in this  paragraph  4 satisfy,  to the  greatest  extent
possible,  the exemptions from the application of Section 409A (any state law of
similar  effect)  provided  under  Treasury   Regulations   1.409A-1(b)(4)   and
1.409A-1(b)(9).  However,  if the Company determines that the Severance Benefits
provided under this Agreement constitute  "deferred  compensation" under Section
409A and you are, on the termination of your service, a "specified  employee" of
the Company, as such term is defined in Section  409A(a)(2)(B)(i) of the Code (a
"Specified  Employee"),  then,  solely  to the  extent  necessary  to avoid  the
incurrence of the adverse  personal tax  consequences  under  Section 409A,  the
timing of the Severance Benefits that constitute deferred  compensation shall be
delayed as follows:  (i) on the earlier to occur of (A) the date that is six (6)
months and one day after your "separation from service" (as such term is defined
in Treasury Regulation Section  1.409A-1(h)) or (B) the date of your death (such
earlier date, the "Delayed Initial Payment Date"), the Company (or the successor
entity thereto,  as applicable) shall (1) pay you a lump sum amount equal to the
sum of the Severance Benefits that you would otherwise have received through the
Delayed  Initial  Payment Date if the payment of the Severance  Benefits had not
been so delayed  pursuant to this  paragraph  4(c) and (2)  commence  paying the
balance of the Severance  Benefits in  accordance  with the  applicable  payment
schedules set forth in this Agreement.

5. Stock Options.  You were granted a total of 1,881,698 options (the "Options")
to purchase  shares of the  Company's  common  stock  pursuant to the  Company's
governing equity incentive plan (the "Plan").  The Options will cease vesting on
the  Separation  Date, at which time a total of 1,318,608  shares subject to the
Options will be fully vested and  exercisable.  The  remaining  unvested  shares
shall automatically lapse and terminate. All rights, duties and obligations with
respect to the Options  (including  your right to exercise any vested shares and
the  applicable  post-employment  exercise  period) shall be as set forth in the
Plan and in the written stock option agreements applicable to the Options.

6. Other  Compensation or Benefits.  You acknowledge  that,  except as expressly
provided in this  Agreement,  you will not receive any additional  compensation,
severance or benefits from the Company after the Separation Date.

7. Return of Company  Property.  By the Separation  Date, you agree to return to
the Company all Company  documents  (and all copies  thereof) and other  Company
property that you have had in your  possession at any time,  including,  but not
limited to, all Company  files,  notes,  drawings,  records,  business plans and
forecasts, financial information, specifications, computer-recorded information,
tangible  property  (including,  but not limited to,  computers),  credit cards,
entry cards, identification badges and keys; and, any materials of any kind that
contain or embody any  proprietary  or  confidential  information of the Company
(and  all  reproductions  thereof).  Your  compliance  with  the  terms  of this
paragraph is a condition precedent to receiving any severance benefits.

8. Proprietary Information.

     (a) Confidential  information.  Until the Separation Date and for all times
thereafter,  you agree to hold in confidence and not to disclose, use or publish
any of the Company's  confidential  and proprietary  information  (collectively,
"Confidential Information"),  except as reasonably necessary for the performance
of your duties through the Separation Date or as expressly authorized in writing
by the CEO. For purposes of this Agreement,  "Confidential Information" includes
all  confidential  knowledge,  data  or  information  related  to the  Company's
business or its actual or  demonstrably  anticipated  research  or  development,
including without limitation (i) trade secrets,  inventions,  ideas,  processes,
computer  source and object  code,  data,  formulae,  programs,  other  works of
authorship,  know-how,  improvements,  discoveries,  developments,  designs, and
techniques;  (ii) information regarding products,  services,  plans for research
and development,  marketing and business plans,  budgets,  financial statements,
contracts,  prices,  suppliers,  and customers;  (iii) information regarding the
skills and  compensation  of  Company's  employees,  contractors,  and any other
service  providers of Company;  (iv) the existence of any business  discussions,
negotiations,  or agreements  between  Company and any third party;  and (v) any
confidential or proprietary information Company has received from third parties.
You hereby assign to Company any rights you may have in any and all Confidential
Information and recognize that all  Confidential  Information  shall be the sole
and exclusive property of Company and its assigns.

     (b) Client Data. You specifically  acknowledge and agree that the Company's
client  lists,  as  well  as  client  names,  contact  information,   and  other
client-related   data   (collectively,   "Client  Data")  is  highly  sensitive,
confidential  and proprietary  information of the Company which may be used only
as necessary  for the  performance  of your  authorized  duties on behalf of the
Company and for no other purpose.  Accordingly,  you  acknowledge and agree that
you will not  disclose  to or use on  behalf  of  yourself  or any  third  party
(including any future employer) any Client Data.

     (c)  Assignment of  Inventions.  Except for  Inventions  that you can prove
qualify fully under the  provisions of California  Labor Code section 2870,  you
hereby assign to Company all your right,  title,  and interest in and to any and
all Inventions (and all Intellectual Property Rights with respect thereto) made,
conceived,  reduced to practice, or learned by you, either alone or with others,
(i)  during  the  period of your  employment  by  Company  or (ii) prior to your
employment  by  Company  and  intended  by you to be  used  by  the  Company  or
specifically  made,  conceived,  reduced to practice,  or learned by you for the
benefit of the Company.  For purposes of this  Agreement  "Invention"  means any
ideas, concepts,  information,  materials,  processes, data, programs, know-how,
improvements,  discoveries,  developments,  designs,  artwork,  formulae,  other
copyrightable works, and techniques and all Intellectual  Property Rights in any
of the items listed above,  and  "Intellectual  Property Rights" means all trade
secrets,   copyrights,   trademarks,   mask  work  rights,   patents  and  other
intellectual  property  rights  recognized  by the laws of any  jurisdiction  or
country.  Inventions  assigned  to the  Company  hereunder  are  referred  to as
"Company Inventions".

<PAGE>

     (d)  Assistance.  You agree to assist Company in every proper way to obtain
and enforce United States and foreign  Intellectual  Property Rights relating to
Company  Inventions  in all  countries.  If the Company is unable to secure your
signature on any document  needed in connection  with such purposes,  you hereby
irrevocably  designate and appoint the Company and its duly authorized  officers
and agents as your agent and attorney in fact, which appointment is coupled with
an interest, to act on your behalf to execute and file any such documents and to
do all other  lawfully  permitted  acts to further such  purposes  with the same
legal force and effect as if executed by you.

     (e) Other Agreements.  The terms set forth in this paragraph 8 (Proprietary
Information) shall be in addition to any other non-disclosure,  confidentiality,
proprietary  information,  and inventions  assignment agreements entered into by
you for the  benefit  of the  Company,  including  that  certain  Non-Disclosure
Agreement between you and the Company dated July 29, 2002 (the  "Confidentiality
Agreement");  provided,  however,  that in the event of any conflict between the
terms of such other  agreements and the terms of this Agreement,  this Agreement
shall be controlling.

9. Non-Interference.

     (a)  Non-Solicitation.  For the remainder of your employment and continuing
for 12 months after the  Separation  Date, you agree that you shall not directly
or  indirectly,  solicit,  induce or encourage  any Company  employee,  agent or
consultant to terminate his, her or its relationship with the Company.

     (b)  Non-Disruption.  For the remainder of your  employment  and continuing
after the Separation Date, you must not: (a) take any action to disrupt,  damage
or interfere  with the  Company's  contractual  relationships  with its clients,
employees,  consultants,  agents or  vendors,  or induce any person or entity to
breach any  contractual  obligation  owed to the  Company;  or (b) engage in any
unlawful or improper  activity to disrupt,  damage or interfere  with  Company's
business, operations or activities.

10. Notification. You understand and agree that the Company may communicate your
obligations  under  paragraph  8  (Proprietary   Information)  and  paragraph  9
(Non-Interference)  of this (and may  provide a copy of this  Agreement)  to any
future  employer  or other  third  party,  as the  Company  deems  necessary  or
appropriate  to protect its  interests.  You further  agree that,  if, within 18
months of the Separation  Date, you accept  employment  with any entity that, at
the time, is directly  competitive with the Company, you will notify the Company
of that fact in writing (sent to the  attention of the CEO),  including the name
and location of such new employer.  Nothing in this Agreement  shall prevent you
from  competing  with the Company or accepting an position  with a competitor of
the Company, subject to your continuing obligations hereunder.

11. Non-disparagement.  You and the Company (through its officers and directors)
agree not to disparage each other or the other's officers, directors, employees,
shareholders,  parents,  subsidiaries,  affiliates,  and  agents,  in any manner
likely to be  harmful  to his,  it or their  business,  business  reputation  or
personal reputation; provided that both parties may respond accurately and fully
to any  question,  inquiry or request  for  information  when  required by legal
process.

12. Release of Claims.

     (a) General  Release.  In exchange  for the  severance  benefits  and other
consideration  to be  provided  to you  under  this  Agreement  that you are not
otherwise  entitled to receive,  you hereby generally and completely release the
Company,  the  Company's  co-employer,  TriNet  Corporation,  and the  Company's
predecessors,  successors,  subsidiaries and affiliated entities  (collectively,
the  "Company  Parties")  and each of the  Company  Parties'  current and former
directors,  officers, employees,  shareholders,  partners, agents, attorneys and
assigns from any and all claims,  liabilities  and  obligations,  both known and
unknown,  that arise out of or are in any way related to events,  acts, conduct,
or  omissions  occurring  prior to your  signing  this  Agreement.  This general
release includes, but is not limited to: (i) all claims arising out of or in any
way related to your employment with the Company,  your activities as an employee
and/or  officer  of  the  Company,   and  the  termination  of  your  employment
relationship  with the Company;  (ii) all claims related to your compensation or
benefits from the Company, including salary, bonuses, commissions, vacation pay,
expense reimbursements, severance pay, fringe benefits, stock, stock options, or
any other  ownership  interests in the  Company;  (iii) all claims for breach of
contract, wrongful termination, and breach of the implied covenant of good faith
and fair dealing; (iv) all tort claims,  including claims for fraud, defamation,
emotional  distress,  and discharge in violation of public  policy;  and (v) all
federal, state, and local statutory claims, including claims for discrimination,
harassment,  retaliation,  attorneys'  fees,  or other claims  arising under the
federal  Civil  Rights Act of 1964 (as  amended),  the  federal  Americans  with
Disabilities  Act of 1990, the federal Age  Discrimination  in Employment Act of
1967 (as amended)  ("ADEA"),  the California Fair Employment and Housing Act (as
amended), and the California Labor Code.

<PAGE>

     (b) Exceptions.  Notwithstanding the foregoing,  you are not releasing: (i)
any rights you have under this  Agreement;  (ii) any rights  that you have to be
indemnified  arising under  applicable law, the certificate of  incorporation or
by-laws (or similar constituent  documents of the Company),  any indemnification
agreement between you and the Company, or any directors' and officers' liability
insurance policy of the Company;  or (iii) any claim that cannot be waived under
applicable  state or federal law.  Nothing in this  Agreement  shall prevent you
from filing,  cooperating  with, or participating  in any proceeding  before the
Equal  Employment  Opportunity  Commission,  the  Department  of  Labor,  or the
California   Department  of  Fair  Employment  and  Housing,   except  that  you
acknowledge  and agree  that you shall not  recover  any  monetary  benefits  in
connection  with any such claim,  charge or proceeding  with regard to any claim
released herein.

13. ADEA Waiver. You acknowledge that you are knowingly and voluntarily  waiving
and releasing any rights you may have under the ADEA ("ADEA  Waiver").  You also
acknowledge that the consideration  given for this ADEA Waiver is in addition to
anything of value to which you were already  entitled.  You further  acknowledge
that you have been advised by this writing,  as required by the ADEA,  that: (a)
your ADEA  Waiver  does not apply to any rights or claims  that arise  after the
date you sign this  Agreement;  (b) you should consult with an attorney prior to
signing  this  Agreement;  (c)  you  have 21 days  to  consider  this  Agreement
(although you may choose to voluntarily sign it sooner);  (d) you have seven (7)
days  following  the date you sign  this  Agreement  to  revoke  it,  with  such
revocation to be effective  only if you deliver  written notice of revocation to
the Company within the seven (7) day period; and (e) the ADEA Waiver will not be
effective  until  the  date  upon  which  the  revocation   period  has  expired
unexercised,  which  will be the  eighth  day  after  you  sign  this  Agreement
("Effective Date").

14. Section 1542 Waiver.  YOU UNDERSTAND THAT THIS AGREEMENT  INCLUDES A RELEASE
OF ALL KNOWN AND UNKNOWN CLAIMS.  In giving the release  herein,  which includes
claims  which may be unknown to you at present,  you  acknowledge  that you have
read and understand  Section 1542 of the California  Civil Code,  which reads as
follows:

    "A general release does not extend to claims which the creditor does
    not know or suspect to exist in his or her favor at the time of
    executing the release, which if known by him or her must have
    materially affected his or her settlement with the debtor."

You hereby  expressly  waive and  relinquish  all rights and benefits under that
section and any law of any other  jurisdiction of similar effect with respect to
your release of any unknown or unsuspected claims herein.

15. Representations.  You hereby represent that, except as expressly provided in
this  Agreement,  you have  been  paid all  compensation  owed and for all hours
worked for the  Company,  have  received  all the leave and leave  benefits  and
protections for which you are eligible, pursuant to the Family and Medical Leave
Act or otherwise, and have not suffered any on-the-job injury for which you have
not already filed a claim.

16. Arbitration. You and the Company agree that any and all disputes, claims, or
causes of action, in law or equity, arising from or relating to the enforcement,
breach,  performance,  execution or  interpretation  of this Agreement  shall be
resolved,  to the  fullest  extent  permitted  by law,  by  final,  binding  and
confidential arbitration in San Jose, California before a single arbitrator with
Judicial  Arbitration and Mediation  Services,  Inc.  ("JAMS") or its successor,
conducted pursuant to the JAMS Employment  Arbitration Rules and Procedures then
in effect. You and the Company  acknowledge that by agreeing to this arbitration
procedure,  both parties  waive the right to resolve any such dispute  through a
trial by jury or judge or administrative  proceeding.  The arbitrator shall: (a)
have the  authority  to compel  adequate  discovery  for the  resolution  of the
dispute and to award such relief as would otherwise be permitted by law; and (b)
issue a  written  arbitration  decision  including  the  arbitrator's  essential
findings and conclusions and a statement of the award.  The arbitrator  shall be
authorized  to award any or all remedies  that the parties  would be entitled to
seek in a court  of law.  The  Company  shall  pay all  JAMS'  arbitration  fees
(including arbitrator fees and administrative fees, but excluding attorneys fees
and costs incurred by you in connection  with the  arbitration).  Nothing herein
shall prevent either party from obtaining  injunctive relief in court to prevent
irreparable  harm pending the conclusion of any arbitration  brought pursuant to
this paragraph.

17.  General.  This  Agreement,  together  with the  Confidentiality  Agreement,
constitutes the complete, final and exclusive embodiment of the entire agreement
between you and the Company  with regard to this subject  matter.  It is entered
into without reliance on any promise or  representation,  written or oral, other
than  those  expressly  contained  herein,  and it  supersedes  any  other  such
promises,  warranties  or  representations,  including  those  set forth in your
Employment  Agreement with the Company dated  December 15, 2002.  This Agreement
may not be  modified or amended  except in a writing  signed by you and the CEO.
This Agreement  will bind the heirs,  personal  representatives,  successors and
assigns of both you and the  Company,  and inure to the  benefit of both you and
the Company,  their heirs,  successors  and  assigns.  If any  provision of this
Agreement is  determined  to be invalid or  unenforceable,  in whole or in part,
this determination will not affect any other provision of this Agreement and the
provision in question  will be modified by the  arbitrator  or court so as to be
rendered enforceable to the fullest extent permitted by law, consistent with the
intent of the parties.  This  Agreement will be deemed to have been entered into
and will be construed and enforced in  accordance  with the laws of the State of
California  as applied to  contracts  made and to be performed  entirely  within
California.

<PAGE>

To accept this  Agreement,  please sign below and return the original to me. You
have  21 days  from  the  date of this  Agreement  to  return  the  fully-signed
Agreement  to me. If we do not receive the  fully-signed  Agreement  from you by
that date, the offer of severance benefits contained herein shall  automatically
lapse and terminate.

We wish you good luck in your future endeavors.

Sincerely,

INTRAOP MEDICAL, INC.


By:  /s/ John Powers
  -------------------------------------
         John Powers, President and CEO



UNDERSTOOD AND AGREED:



/s/ Howard Solovei
--------------------------
Howard Solovei


10/29/2008
--------------------------
Date

1106792 v3/SF