HYTERRA LTD — Capital/Financing Update 2007

Aug 26, 2007

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www.brainz.com ARBN 116 829 675

ASX Announcement

New funding for clinical trial using BrainZ technology

27 August 2007: BrainZ Instruments (ASX:BZI) announced today that a critical clinical pilot study involving its brain monitoring technology has received external funding through the New Zealand based Cure Kids Charity.

This program is a collaborative venture involving three organisations; a major US university school of medicine, a charitable funding organisation and a medical technology company that are all focused on a common goal to improve neurological outcomes in at-risk infants. The role of BrainZ in the project is to provide and support bedside brain monitors equipped with RecogniZe a proprietary software developed by BrainZ designed to detect seizures (currently pending FDA approval).

The trial is expected to further underpin the growing body of clinical data supporting the clinical relevance of the BrainZ technology. In particular, it is anticipated to generate important findings in relation to the value of RecogniZe in assisting clinicians to detect seizures.

CEO, Richard Smith, stated, “In the early stages BrainZ seeded research by funding trials in neonatal brain monitoring. Now that the value of bedside brain monitoring (and the BrainZ product) is more broadly accepted we are able to minimise our spending and have research projects driven by institutes who have access to funding through charitable and research collaborations. This is in keeping with our announcement in May this year that BrainZ would be able to reduce its reliance on internally funded research projects and transition to a model of actively supporting externally funded projects. In doing so, BrainZ will also improve the cost efficiency of its development activities as compared to previous periods.”

Mr Smith also stated that this pilot study, if successful, may lead to a multi-centre study supported through major research funding sources such as the US National Institutes of Health. The pilot study is expected to take approximately six months.

Inquiries:

Richard Smith Rudi Michelson Chief Executive Officer Monsoon Communications BrainZ 03 9620 3333 +1 443 280 2920

About Cure Kids

Cure Kids is a New Zealand based charity established over 30 years ago to address the lack of research into life-threatening childhood illnesses. Cure Kids have invested over $19 million in medical research for children who suffer life threatening illnesses.

About BrainZ

BrainZ (ASX: BZI) is a New Zealand based medical technology company specializing in the research, development, manufacturing and sale of bedside brain monitoring technology. The BRM2 Brain Monitor, BrainZ’s first product, is a unique bedside tool that assists in the detection of brain injury and seizure activity in neonates. It has been specifically designed to assist intensive care staff with clinical decision-making in conjunction with other clinical data and in the direction of care on a day-to-day basis.

The BRM2 monitor has received regulatory approval and is in use in 20 countries worldwide. BrainZ dominates the local Australian and New Zealand markets via direct sales channels. BRM2 monitors are also installed in over 40 leading US hospitals. BrainZ has secured an exclusive agreement with GE Healthcare, a leading supplier of patient monitoring systems, for the distribution of BRM2 Brain Monitors in the USA and UK markets.

BrainZ Instruments was established in 2001 to commercialize pioneering neonatal brain research from the Auckland University’s Liggins Institute.