THE PROPOSED FINANCING OF PASW
AND OF THE MERGER. EXCEPT WITH RESPECT TO THE PARAGRAPH TITLED "EXCLUSIVITY,"
THIS TERM SHEET IS FOR DISCUSSION PURPOSES ONLY; THERE IS NO OBLIGATION ON THE
PART OF ANY NEGOTIATING PARTY UNTIL DEFINITIVE AGREEMENTS ARE SIGNED BY ALL
PARTIES.
THE TRANSACTIONS CONTEMPLATED BY THIS TERM SHEET ARE SUBJECT TO THE
SATISFACTORY COMPLETION OF DUE DILIGENCE AND OTHER CONDITIONS.
THIS TERM SHEET
DOES NOT CONSTITUTE EITHER AN OFFER TO SELL OR AN OFFER TO
PURCHASE SECURITIES.
Very truly yours,
VirnetX Inc.
By
/s/ Kendall Larsen
Kendall Larsen, President & CEO
AGREED TO AND ACCEPTED:
This 18th day of January 2007
PASW, Inc.
By
/s/ William E. Sliney
William E. Sliney, President and
Chief Financial Officer
AGREED TO AND ACCEPTED:
This 18th day of January 2007