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                                                                   EXHIBIT 10.32


MAY 2004



JAPANESE MARKET DEVELOPMENT LETTER AGREEMENT


Stereotaxis, Inc. ("Stereotaxis") -- on the one side -- and Siemens
Aktiengesellschaft, Medical Solutions ("Siemens") and Siemens Asahi Medical
Technologies Ltd. ("SAM") -- on the other side -- set forth in this letter
agreement (this "Agreement") the general terms of their collaboration in respect
of development of the Japanese market for NIOBE Systems, whether integrated with
Siemens imaging systems or those of third parties, as follows:

1. OVERVIEW

The objective of the collaboration of Stereotaxis and Siemens in respect of the
Japanese market is to facilitate penetration of the Japanese interventional
cardiology and electrophysiology cath lab markets with NIOBE Systems and the
utilization of these systems by Japanese customers. Siemens, through its
subsidiary SAM, will take primary responsibility for and coordinate the
regulatory process to achieve approval by the Ministry of Health, Labour and
Welfare of Japan ("MHLW") under the Pharmaceutical Affairs Law to obtain
regulatory clearance ("Shonin") for commercial use of the NIOBE System in Japan
in a manner that permits the Shonin to be transferred to Stereotaxis at
Stereotaxis election, in the manner set out below. Siemens will also, at
Stereotaxis' request, support the regulatory process to achieve Shonin
regulatory clearance in respect of disposable products for use with the NIOBE
System in a manner that permits the Shonin to be transferred to Stereotaxis on
its written request, in the manner set out below. In order to facilitate these
objectives, except as noted in paragraph 3(c) of this Agreement, Stereotaxis
agrees to appoint SAM as its sole distributor in Japan on the terms and
conditions set forth herein. Stereotaxis and SAM agree that the pricing defined
in sections 5 and 8 below of this Agreement applies to the current generation of
the Niobe system only.

2. REGULATORY PROCESS

Siemens will be ready to submit its sponsorship of the regulatory protocol for
Shonin regulatory clearance on or before the date which is 30 days following the
time Siemens


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has received all of the information necessary for submission of the protocol,
which sponsorship shall include the NIOBE System and its accessories (described
below under "Accessories for Japanese Market"). SAM will also, at Stereotaxis'
request, support the regulatory process to achieve Shonin regulatory clearance
in respect of disposable products for use with the NIOBE System. In all cases,
regulatory clearance shall be sought in a manner that permits transfer of the
Shonin (or where feasible, transfer of the application for the Shonin) to
Stereotaxis at Stereotaxis' election and at Stereotaxis' expense. Stereotaxis
may make such election by written notice to Siemens in respect of any
Stereotaxis product at any time.

3. DISTRIBUTION

         (a) Subject to Paragraphs 3(b) and (c) below, SAM is appointed sole
distributor for NIOBE System and related accessories (but not disposable
instruments) in Japan and will use all reasonable commercial efforts to maximize
the placements of such products in Japan. This Agreement shall not entitle
Siemens or SAM to any distribution rights in respect of any disposable
instruments used with the NIOBE System. It is the intention of the parties that
the term of this distribution arrangement will be five years, commencing January
1, 2004 and ending December 31, 2008, unless this Agreement is not renewed or is
otherwise terminated in accordance with the terms herein. However, during such
five-year period, the parties will confer at least annually to mutually agree
upon commercially reasonable distribution goals in Japan for the next year and
to quarterly review performance against goals for the calendar year, provided
that the parties agree that the initial distribution goals (including the
promotional site placements described in Section 8) will be as set forth on
SCHEDULE A. Where goals were achieved for the prior year and the parties reach
such mutual agreement as to goals for the next year, SAM's appointment as sole
distributor of the NIOBE System and related accessories in Japan will be renewed
for the next year. [***] Within 12 months prior to December 31, 2008, the
parties will confer and negotiate in good faith whether to further extend the
appointment of SAM as distributor of the NIOBE Systems and accessories in Japan.
[***]


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[***]

         (b) In the event that the appointment of SAM as distributor for the
NIOBE System and accessories in Japan is not renewed in the manner set out above
during the [***] and where SAM has complied with its obligations as distributor
and has achieved the distribution goals agreed upon as provided in the previous
paragraph, Stereotaxis will pay to Siemens an amount comprising the reasonable
costs actually incurred by SAM for regulatory and other NIOBE distribution
start-up costs in Japan, [***]. The determination of such regulatory and
distribution start-up costs shall be determined on a reasonable and customary
basis as agreed between the parties. Siemens shall provide an annual accounting
for such actual costs incurred, subject to the approval of Stereotaxis.

         (c) Japanese distribution and service of the NIOBE System and
accessories will encompass placements that are integrated with the ARTIS dF
FLUOROSCOPY System and with third party imaging systems. Stereotaxis can provide
marketing and promotional support for NIOBE System and accessories that are
integrated with third-party imaging systems, including related activities such
as sales force training and presentations to customers. In the case of such
placements, SAM shall act as the import and distribution agent (subject to the
limitations on transfer pricing set forth below), and SAM shall be responsible
for the installation and service of such NIOBE Systems, provided that SAM may
subcontract such installation and service obligations to one or more parties
acceptable to Stereotaxis and to the third party imaging company. SAM agrees use
its best efforts to carry out its distribution, installation and service
obligations under this Agreement on a timely basis in connection with such sales
and marketing activities between Stereotaxis and such third party imaging
companies.

         (d) Stereotaxis will provide a level of training to SAM's Japanese
sales force in respect of NIOBE Systems and accessories as would be commercially
reasonable for equivalent U.S. sales force training. Stereotaxis shall provide
two days of training per

[*** Indicates portions of this exhibit that have been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.]


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year to the Japanese sales force in Japan. Each party will be responsible for
the travel and expenses of their respective representatives to attend such
two-day training. Stereotaxis will forward a training schedule to SAM after the
two training days are determined. Siemens will pay for any additional training
requests at a [***] per Stereotaxis representative per day, plus the reasonable
travel and expenses of such Stereotaxis representatives. Additional training
days will include training of new sales representatives during the same
agreement year and training for any software upgrades provided at no charge. For
each new software release purchased at an agreed upon incremental cost,
Stereotaxis will provide one day of training by a Stereotaxis representative at
Stereotaxis' cost, at a time and location to be mutually determined by the
parties.

         (e) Further details of the distributor relationship between Stereotaxis
and SAM will be set forth in a Distributorship Agreement to be separately
concluded not later than 60 days after the date of this Agreement, provided that
the terms of the Distribution Agreement shall be consistent with, and shall not
conflict with, this Agreement.

         (f) [***]

         (g) [***]

         (h) The inclusion of any additional applications contemplated by
subparagraphs (f) and (g) shall be subject to a mutually agreed upon increase of
NIOBE System distribution goals specific to the clinical application for a
specified period of time. Stereotaxis may integrate either application with
third party imaging systems other than the ARTIS dF FLUOROSCOPY System. If the
parties do not agree to move forward with respect to the neurological or the
interventional radiology applications described in


[*** Indicates portions of this exhibit that have been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.]

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subparagraphs (f) and (g), then Stereotaxis shall have the right to pursue
either or both of those applications with one or more third parties.

         (i) SAM will provide all necessary translations of documents into
Japanese relating to the matters set forth herein and will also be responsible
for importation and customs processes for products landed in Japan at SAM's cost
and expense (with reasonable cooperation from Stereotaxis).

4. COSTS OF REGULATORY CLEARANCE

[***] SAM and Stereotaxis will contribute [***] of the reasonable costs of
obtaining regulatory clearance for the NIOBE System and accessories (except in
respect of clinical trials, for which costs will be split [***] between SAM,
Stereotaxis and Stereotaxis' appointed Japanese distributor for disposables).
Stereotaxis or its disposables partner will pay for all incremental costs
associated with disposable devices clearance.

5. TRANSFER PRICE

The transfer price of NIOBE Systems and accessories to SAM for distribution in
Japan [***]. The pricing for a third party hereunder will be determined and
denominated in U.S. Dollars and does not include any services such as shipping,
insurance, room preparation or installation.

6. ACCESSORIES FOR JAPANESE MARKET

NIOBE accessories covered by the distribution alliance will comprise the
Navigant Advanced Workstation, the CardioDrive catheter advancer hardware (but
not including the Stereotaxis CardioDrive disposable device), discrete
navigation software products and such other accessories as are reasonably
nominated by Stereotaxis from

[*** Indicates portions of this exhibit that have been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.]
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time to time that are designed for use with the NIOBE system. "Accessories"
shall not include disposable interventional devices such as catheters,
guidewires and stent delivery devices.

7. JAPANESE SERVICE, WARRANTY AND RECURRING COSTS/LICENSE FEES

         (a) Service and Warranty. Stereotaxis will subcontract to SAM the
warranty and all service for the NIOBE Systems and accessories placed in Japan
and all obligations and benefits related thereto, including for NIOBE System
placements that are integrated with third party imaging systems. SAM shall
perform its service and warranty obligations on commercially reasonable terms
and conditions, including as to price, and such terms, conditions, pricing and
performance levels shall be the same for NIOBE placements integrated with the
Siemens' imaging systems as for those placements integrated with third party
imaging systems. Stereotaxis will provide spare parts as reasonably required to
SAM for the Japanese market at commercially reasonable transfer prices (refer to
Schedule C, spare parts Stereotaxis will provide a level of training to SAM's
Japanese service and field support representatives in respect of NIOBE Systems
and accessories as would be commercially reasonable for equivalent U.S. service
and field support representatives training. If training is required in Japan,
each party will be responsible for the travel and expenses of their respective
representatives to attend such training. [***]

         (b) [***] Recurring Costs/License Fees. There shall be a license fee
for the Navigant(TM) software of [***]. Navigant(TM) is tailored toward either
electrophysiology or interventional cardiology applications. If both
applications are chosen the license fee for Navigant(TM) will be [***]. Software
license fees are a condition of the sale of the Navigant software and will
continue after the termination or expiration of this Agreement. [***].



[*** Indicates portions of this exhibit that have been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.]

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         (c) Stereotaxis may from time to time develop additional software
options which will be available for sale to SAM or if SAM declines, for sale to
customers directly. Each of these software options may have annual license fees
which will be the responsibility of SAM from the date the option is sold. These
annual license fees will also continue after the termination or expiration of
this Agreement.

8. JAPANESE PROMOTIONS

       (a) SAM and Stereotaxis will mutually agree upon [***] promotional sites
[***]. SAM will cooperate to facilitate timely installation of these systems in
[***]. [***] sites are targeted to be installed in [***] in order to qualify as
research institutions for their respective applications. [***].

       (b) [***].

       (c) Stereotaxis and SAM to cooperate so as to jointly exhibit at trade
shows set forth in SCHEDULE B in 2004 and 2005. [***].

9. MISCELLANEOUS

       (a) Notwithstanding any other provision of this Agreement, this Agreement
may be terminated (i) by the Parties at any time and for any reason upon the
Parties' mutual written agreement, or (ii) by either Party for a material breach
by the other Party if such breach continues unremedied for a period of thirty
(30) days after receipt by the breaching Party of notice of the breach from the
non-breaching Party.

       (b) This Agreement shall be construed and enforced in accordance with the
laws of the State of New York, USA.

       (c) All disputes arising out of this Agreement shall be finally resolved
by arbitration conducted in the English language in accordance with the
commercial


[*** Indicates portions of this exhibit that have been omitted and filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.]

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arbitration rules of the American Arbitration Association ("AAA"), in New York,
New York, USA. Within thirty (30) days after a request or demand for arbitration
is filed with the AAA, each Party shall appoint one (1) arbitrator. The two
arbitrators so appointed shall jointly appoint a third arbitrator within fifteen
(15) days. If a Party fails to appoint an arbitrator, the AAA shall appoint an
arbitrator for such Party. The AAA shall be the administrator of the arbitration
proceedings. The award entered by the arbitrator(s) shall be final and binding
on all parties to arbitration. Each party shall bear its respective arbitration
expenses and shall each pay fifty percent (50%) of the arbitrator's charges and
expenses.



AGREED TO THIS 18 DAY OF MAY, 2004 BY:


STEREOTAXIS, INC:

BY /s/ BEVIL HOGG
  --------------------------
NAME: BEVIL HOGG
     -----------------------
TITLE: CEO
      ----------------------


SIEMENS AKTIENGESELLSCHAFT, MEDICAL SOLUTIONS

BY /s/ ILLEGIBLE                /s/ R. THOMAS
  --------------------------    ---------------------------
NAME: ILLEGIBLE                 R. THOMAS
     -----------------------    ---------------------------
TITLE: PRESIDENT AX             CFO AX
      ----------------------    ---------------------------


SIEMENS ASAHI MEDICAL TECHNOLOGIES LTD.

BY /s/ W. BEITZ                 /s/ E.  WENNINGER
  --------------------------    ---------------------------
NAME: WOLFGANG BEITZ            E. WENNINGER
     -----------------------    ---------------------------
TITLE: VICE-PRESIDENT           DIRECTOR
      ----------------------    ---------------------------


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