Document:

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                                                                   EXHIBIT 10.16

                                LETTER AGREEMENT
         STEREOTAXIS, INC. ("STEREOTAXIS") AND PHILIPS MEDICAL SYSTEMS
                              DMC GMBH ("PHILIPS")

1.    PREAMBLE

PURSUANT TO THIS LETTER AGREEMENT, PHILIPS AND STEREOTAXIS SET FORTH THE BINDING
HEADS OF AGREEMENT OUTLINING THE PRINCIPAL TERMS AND CONDITIONS FOR THEIR
STRATEGIC ALLIANCE FOR THE DEVELOPMENT OF IMPORTANT NEW TECHNOLOGIES FOCUSING ON
THE KEY ROLE OF PHILIPS' INTEGRIS ALLURA FLAT DETECTOR CATH LAB SYSTEM AND
STEREOTAXIS' NIOBE SYSTEM IN INTEGRATED DIGITAL CATH LAB OF THE FUTURE, ALL TO
BE FURTHER ELABORATED IN A DETAILED CO-DEVELOPMENT AND COMMERCIAL AGREEMENT
("DETAILED AGREEMENT") TO BE NEGOTIATED IN GOOD FAITH AND TO BE AGREED UPON
BETWEEN THE PARTIES AS PART OF THE DEVELOPMENT PROGRAM. The Detailed Agreement
shall contain commercially reasonable terms, conditions, representations,
warranties and covenants customary and appropriate for a transaction of the type
contemplated, that will be subject to and including those summarized in this
Letter Agreement.

The parties initial alliance focus is in the field of interventional cardiology,
with additional emphasis in the field of electrophysiology and on the
development of unique solutions as mutually agreed in the fields of
interventional radiology, interventional neuro-radiology and on potential
applications for their combined digital platform in additional fields of
medicine.

The parties agree to collaborate on the integration of a modified version of the
Stereotaxis' NIOBE System (an FDA cleared medical device) and Philips' latest
generation Integris Allura flat detector Cath lab system ("Philips X-Ray") to
provide clinicians with a user-friendly advanced interventional suite with
integration of digital instrument control and X-ray imaging comprising an
integrated system (collectively, "Integrated Cath Lab") and designed to ensure
effective and safe use of integrated imaging and instrument control.

The intention of the parties is that the Integrated Cath Lab will primarily be
designed to focus on interventional cardiology applications, while also
including features making the system suitable for use in electrophysiology
(including integration capability for third party three dimensional instrument
localization systems) and, to the extent mutually agreed by the parties from
time to time, in writing, in interventional radiology, interventional
neuro-radiology or other applications.

Features of the parties' collaborative alliance include, without limitation:

      o     Development of Integrated Cath Labs;

      o     Co-placement and co-marketing of Integrated Cath Labs;

      o     Co-development of new solutions & technologies (as mutually agreed
            in writing from time to time and primarily comprising applications
            for Integrated Cath Labs, primarily focusing in interventional
            cardiology as noted above);

      o     Service, training and support for Integrated Cath Labs;

      o     Development funding for Integrated Cath Labs;

and otherwise as set out below or agreed between the parties.

Initial Philips:                                            Initial Stereotaxis:

/s/ JURGEN TIEMANN                                             /s/ BEVIL HOGG

                                        1

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1.    INTEGRATION SCHEDULE AND JOINT DEVELOPMENT PLAN

o     The parties will use all reasonable commercial efforts and will coordinate
      and cooperate in good faith to achieve completion of the Integrated Cath
      Lab so as to allow demonstration of the first customer-ready system by TCT
      in September, 2004 or earlier

o     Immediately after signing of this Letter Agreement each party will appoint
      and will notify the other in writing of its integration project manager
      responsible for coordinating integration development work

o     The project managers will promptly coordinate and prepare a detailed
      schedule and joint development plan for achieving development of the
      Integrated Cath Labs, focusing in particular on inclusion of features
      tailored for high volume and important interventional cardiology
      applications and compliance with the integration schedule designated
      above. Such detailed schedule and joint development plan shall be subject
      to review and written approval of duly authorized officers of both
      parties.

2.    DEVELOPMENT WORK.

o     The development work will be carried out in close cooperation between the
      parties and based on a joint development plan which includes appropriate
      milestones in an effort to keep cost and expenditures to a minimum

o     The parties intend to negotiate in good faith regarding mutually agreeable
      research and development collaborations for future generations of the
      Integrated Cath Lab.

o     Guiding principles for the development work will be that Stereotaxis
      undertakes all work required to modify the NIOBE System (including user
      interface software compatibility, mechanical integration required to
      achieve requisite magnetic and C-arm angles for interventional cardiology
      etc.) and Philips undertakes all work required to modify the Philips X-Ray
      (user interface software compatibility, C-arm motion integration, magnetic
      shielding etc.). Each party provides the other with requisite permissions
      (and represents that is has associated authority) to integrate its
      products with those of the other party as comprised in the Integrated Cath
      Lab in the manner contemplated by this Letter Agreement.

o     Philips will pay Stereotaxis for its engineering and other resources and
      costs of the integration and related research and development work via a
      milestone driven research and development payment up to a maximum of
      $[***] ("R&D Milestone Payment") as set out below. Both parties will
      provide all commercially reasonable and expeditious completion of its
      development work and coordination with the other party in good faith in
      order to facilitate completion of development work by both parties.
      Stereotaxis' deliverables set out below are subject to change by mutual
      written agreement based upon the detailed schedule and joint development
      plan as referred to above or otherwise. Within 30 days of signing of this
      Letter Agreement, Philips will pay Stereotaxis [***]$ by way of prepayment
      of the estimated development work. The parties agree that any prepayment
      of research and development funding set out below are repayable to Philips
      in absence of fulfillment of Stereotaxis' contractual obligations in
      respect of research and development work pursuant to this agreement.

o     Development work to be undertaken by Stereotaxis will comprise:

          PHASE 1. CONCEPT & FEASIBILITY, INITIAL DESIGN.

          Working in full coordination with the dedicated Philips' integration
          team, during Phase 1 Stereotaxis will:

Initial Philips:                                            Initial Stereotaxis:

/s/ JURGEN TIEMANN                                             /s/ BEVIL HOGG

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

                                        2

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      1.    Develop a set of consolidated requirement documents, standards, and
            plans addressing product functionality; testing and integration
            standards, installation and support plans, regulatory approval plans
            and the clinical validation process

      2.    Provide these requirements to a second dedicated team, spanning
            multiple disciplines, which will create a joint system concept
            including x-ray system magnetic and physical range of motion
            compatibility

Upon completion of Phase 1 (as certified in writing by Stereotaxis and confirmed
thereafter in writing by Philips) Philips will pay Stereotaxis the calculated
expenditures of the R&D Milestone Payment by Stereotaxis for Phase 1 as
reflected in the specified Stereotaxis invoice, in accordance with the
calculations set out below and a prepayment of [***]$ in respect of Phase 2 and
provided that in no event will Philips be required to pay Stereotaxis an
aggregate of more than $[***] for all phases)

      PHASE 2. DETAILED DESIGN. Working in full coordination with the dedicated
      Philips' integration team during Phase 2, Stereotaxis will:

      1.    Expand this team to address the detailed system design, including
            unique user interface components, joint installation planning
            documents, design validation and verification testing, production,
            and support process development

      2.    Progress the software design effort concurrently to address
            real-time motion feedback, collision avoidance, X-ray graphic
            overlays, and image registration issues

Upon completion of Phase 2 (as certified in writing by Stereotaxis and confirmed
thereafter in writing by Philips) Philips will pay Stereotaxis a prepayment of
[***]$ in respect of Phase 3 and the calculated expenditures of the R&D
Milestone Payment by Stereotaxis for Phase 2 as reflected in the specified
Stereotaxis invoice, in accordance with the calculations set out below and
provided that in no event will Philips be required to pay Stereotaxis an
aggregate of more than $[***] for all phases)

      PHASE 3. TESTING AND VALIDATION; REGULATORY. Working in full coordination
      with the dedicated Philips' integration team during Phase 3, Stereotaxis
      will: Provide dedicated systems support to the joint integration testing
      and the regulatory design validation process as well as the ongoing
      sustaining engineering efforts

      1.    In parallel, preparing for market introduction activities through
            production and support groups including installer taming, support
            engineering processes, parts logistics and service agreements

      2.    Beta installations and testing, final design freeze no later than 6
            months after first beta installation

Upon completion of Phase 3 (as certified in writing by Stereotaxis and confirmed
thereafter in writing by Philips) Philips will pay Stereotaxis the calculated
expenditures of the R&D Milestone Payment by Stereotaxis for Phase 3 as
reflected in the specified Stereotaxis invoice, less any underage left over
from, or plus any overage above, the prepayments already made for prior phases,
in accordance with the calculations set out below and provided that in no event
will Philips be required to pay Stereotaxis an aggregate of more than $[***]
million for all phases)

Initial Philips:                                            Initial Stereotaxis:

/s/ JURGEN TIEMANN                                             /s/ BEVIL HOGG

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

                                       3
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3.    INVOICING OF DEVELOPMENT EXPENDITURES

Within ten (10) days of completion of each Phase of integration Research and
Development, Stereotaxis will provide Philips a written invoice stating the
approximate sum and breakdown of the following development expenditures
("Expenditures") incurred by Stereotaxis in such stage:

      1.    The number of Stereotaxis employees allocated to the development
            work in such Phase and their titles;

      2.    The percentage of each such employees' time allocated to work on the
            Phase (on a monthly basis);

      3.    The remuneration (on a fully loaded basis) of each such employee in
            the pertinent Phase;

      4.    A statement of related materials and/or other related third party
            costs expended during such Development Phase as included in the
            invoice.

4.    CENTERS OF EXCELLENCE

The parties will establish a minimum of three promotional "Center of Excellence"
Integrated Cath Labs. The parties intend that the Centers of Excellence will be
the focus of development of unique solutions in areas of technology leadership
to be mutually agreed. The Centers of Excellence will be installed at mutually
agreed sites, which could include:

      o     St. Georg, Hamburg

      o     University of California at San Francisco

      o     Others to be determined.

The installation timeline for Centers of Excellence will be mutually agreed
promptly after signing of this Letter Agreement.

Philips will purchase a maximum of three NIOBE Systems (comprising components of
Integrated Cath Labs to be placed by Philips at Centers of Excellence) by
purchase order issued by no later than December 31, 2004 (or, at Stereotaxis
election, January 1, 2005) each system individually payable in three terms
(first term upon placing the order, second term upon delivery of the system and
a final term upon hand-over to the customer) at [***].

5. CO PLACEMENTS

      o     The parties will work together to maximize sales through
            co-placement and co-marketing of Integrated Cath Labs, including
            cooperating in good faith to achieve co-ordination and cooperation
            of sales forces to facilitate co-placements at mutually agreed
            targeted sites, provided that the parties continue to maintain
            distinct and separate sales operations and identities

      o     Philips will provide project management at customer sites for
            Integrated Cath Labs addressing room preparation and installation

      o     By way of sharing of co placement economics Philips will pay to
            Stereotaxis a co placement fee according to the following schedule:

                  o     [***]

                  o     [***]

                  o     [***]

Initial Philips:                                            Initial Stereotaxis:

/s/ JURGEN TIEMANN                                             /s/ BEVIL HOGG

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

                                        4

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      o     The total amount as at the date of signing of this Letter Agreement,
            and based upon commercially reasonable principles of calculation, of
            the sum of: (i) the aggregate R&D Milestone Payment; (ii) the
            aggregate payments per co placement to Stereotaxis; and (iii) the
            aggregate purchase price of the three NIOBE System purchased by
            Philips for placement in Centers of Excellence described above will
            never exceed 7.5M$

6.    [***]

7.    FIELD SERVICE

The parties will co-ordinate installation of delivery of their respective
components of Integrated Cath Labs.

Stereotaxis will provide service and support for its components of not less than
three of installations of Integrated Cath Labs for initial periods after
installation to be mutually agreed.

Philips to provide service for Integrated Cath Labs other than at mutually
agreed sites and geographies on commercially reasonable terms.

Stereotaxis' to provide training for a reasonable number of Philips' specialists
in the service of Stereotaxis' components of Integrated Cath Labs.

Stereotaxis to provide a commercially reasonable level of helpdesk service as
backup support for Philips service of Stereotaxis components of Integrated Cath
Labs

8.    OPEN ARCHITECTURE

Philips recognizes that Stereotaxis can integrate with third party X-ray systems
without limitation in the same manner as is comprised in Integrated Cath Labs or
otherwise.

9.    LEGAL FEES AND EXPENSES

Each party shall pay its own fees and expenses in connection with this Letter
Agreement including, without limitation, legal fees and other expenses.

10.   LOGISTICS

Each party intends to ship directly to the customer site in accordance with the
schedule coordinated by the Philips' project manager

The first Integrated Cath Labs will be tested at Philips before shipment to the
customer to assure compatibility

11.   CONFIDENTIALITY

The parties agree that they shall not disclose and shall keep confidential any
information furnished to them by the other party in connection with the alliance
set forth in this Letter Agreement and as elaborated in the mutual Non
Disclosure Agreement between the parties dated January 24th 2003 and will not
make any disclosure in relation to the alliance without the prior written
consent of the other. The parties will mutually agree an announcement regarding
their strategic alliance on signing of this Letter Agreement.

The parties acknowledge and agree that regulatory constraints including in the
U.S. and Europe, prohibit their promoting or marketing either directly or
indirectly, through announcements, sales force representations or otherwise the
specifications, functionality, anticipated time to market or other details of
any jointly developed products pursuant to this strategic alliance prior to
relevant regulatory

Initial Philips:                                            Initial Stereotaxis:

/s/ JURGEN TIEMANN                                             /s/ BEVIL HOGG

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

                                       5
<PAGE>

clearances being obtained and each party will take all steps required to ensure
that it and its representatives comply with all such regulatory constraints.

12.   AMENDMENT

This Letter Agreement may not be amended without the written consent of the
parties

13.   ASSIGNMENT TO PHILIPS' SUBSIDIARY/ASSOCIATED COMPANY

Philips shall have the right to assign its rights and obligations hereunder to
any of its subsidiaries and/or associated companies

14.   GOVERNING LAW

This Letter Agreement and the Detailed Agreement contemplated herein shall be
governed by and construed in accordance with the laws of Germany without regard
to the conflicts of laws provisions thereof. This Term Sheet is executed in the
English language version which version shall prevail over any translation
hereof.

AGREED:

SIGNATURE: /s/ JURGEN TIEMANN

NAME: JURGEN TIEMANN

TITLE: EXECUTIVE VICE PRESIDENT & CEO

COMPANY: PHILIPS MEDICAL SYSTEMS DMC GMBH

DATE SIGNED: 15 SEPT. 2003

SIGNATURE: /s/ BEVIL HOGG

NAME: BEVIL HOGG

TITLE: PRESIDENT & CEO

COMPANY: STEREOTAXIS, INC.

DATE SIGNED: 6 OCT. 2003

Initial Philips:                                            Initial Stereotaxis:

                                                               /s/ BEVIL HOGG

                                       6<PAGE>

                                                                   EXHIBIT 10.18

                         SOFTWARE DISTRIBUTION AGREEMENT

                                 by and between

                   STEREOTAXIS INC., UNITED STATES OF AMERICA

                 - hereinafter referred to as "Stereotaxis" -
                                       and

                 SIEMENS AKTIENGESELLSCHAFT, BERLIN AND MUNCHEN,
                           Federal Republic of Germany

                    - hereinafter referred to as "Siemens" -

           concerning the "3D Pre-Operative Image Navigation" software

<PAGE>

                             CONFIDENTIAL TREATMENT

                         REQUESTED BY STEROTAXIS, INC.

<Table>
<S>          <C>                                                              <C>
ARTICLE 1  - DEFINITIONS ....................................................  3

ARTICLE 2  - LICENSE GRANT ..................................................  5

ARTICLE 3  - COPYRIGHT, TRADEMARKS, TITLE ...................................  6

ARTICLE 4  - SUPPLY OF LICENSED SOFTWARE AND SOFTWARE DOCUMENTATION .........  7

ARTICLE 5  - TIMELINES ......................................................  8

ARTICLE 6  - WARRANTY .......................................................  8

ARTICLE 7  - INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES ..................  9

ARTICLE 8  - PRICE, PAYMENT ................................................. 13

ARTICLE 9  - AUDITING RIGHTS ................................................ 14

ARTICLE 10 - MAINTENANCE .................................................... 14

ARTICLE 11 - CONFIDENTIALITY ................................................ 15

ARTICLE 12 - LIMITATION OF LIABILITY ........................................ 18

ARTICLE 13 - FORCE MAJEURE .................................................. 19

ARTICLE 14 - ARBITRATION .................................................... 19

ARTICLE 15 - SUBSTANTIVE LAW ................................................ 20

ARTICLE 16 - TERM OF THE AGREEMENT .......................................... 20

ARTICLE 17 - TERMINATION .................................................... 20

ARTICLE 18 - EXPORT REGULATIONS ............................................. 22

ARTICLE 19 - MISCELLANEOUS .................................................. 22
</Table>

<PAGE>

PREAMBLE

WHEREAS, Siemens and Stereotaxis have entered into an extended collaboration
agreement to improve interventional procedures in the cardiac cathlab by
enabling visualization and navigation with pre-operative anatomical 3D images
(hereinafter referred to as the "Extended Collaboration Agreement");

WHEREAS, Siemens and Stereotaxis do not intend for any provision of this
Agreement to alter or amend the rights or obligations provided under the
Extended Collaboration Agreement;

WHEREAS, Siemens has developed the Siemens "Pre-operative Imaging Component"
software and/or is the owner of or is entitled to dispose of the proprietary
rights of and/or titles to such software product;

WHEREAS, Stereotaxis desires to obtain license and distribution rights in such
software product;

WHEREAS, Siemens is willing to license such software product to Stereotaxis as
consideration for license fees stated herein and on the terms and conditions set
forth in this Agreement.

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein
contained Stereotaxis and Siemens agree as follows:

ARTICLE 1 - DEFINITIONS

Wherever used in this Agreement, unless otherwise indicated expressly in the
context of this Agreement, the following terms shall have the following meanings
ascribed to them:

1.1      "Agreement" shall mean this software distribution agreement including
         all Annexes and any matters specifically incorporated herein by
         reference and made a part hereof.

1.2      "End-user" shall mean the customer of Stereotaxis who uses the Licensed
         Software as embedded within the Product for its own medical or
         scientific purposes.

<PAGE>

                                                          CONFIDENTIAL TREATMENT
                                                  REQUESTED BY STEREOTAXIS, INC.

1.3      "Licensed Software" shall mean the software program presently known as
         3D Pre-Operative Image Navigation V1.00 in Object Code and finally and
         conclusively described in ANNEX 1 and all Updates thereto.

1.4      "Software Documentation" shall mean the information needed to draft
         End-user manuals and all other information related to the Licensed
         Software, as set-out in ANNEX 2 and all Updated Software Documentation
         thereto. Siemens will provide this in machine-readable form.

1.5      "Effective Date" shall mean the date on which the last of the Parties
         has executed this Agreement.

1.6      "Hardware" shall mean the hardware equipment as described in ANNEX 3.

1.7      "Object Code" shall mean code for the Licensed Software resulting from
         translation of source code into machine readable format appropriate for
         operation on the Hardware.

1.8      "Product" shall mean the Stereotaxis Navigant system or similar or
         extended successor systems.

1.9      "Reference Environment" shall mean a system consisting of the Hardware
         and the software described in ANNEX 1 and shall be used for testing the
         Licensed Software and for communicating, duplicating and reproducing
         errors of the Licensed Software.

1.10     "Updated Software Documentation" shall mean any change in the Software
         Documentation that is needed because of an Update or changes of the
         Hardware.

1.11     "Update" shall mean a new release of the Licensed Software that
         incorporates error corrections; software changes due to vendor-
         required Hardware changes, or for migration to higher versions of
         Windows software or DICOM networking standard, improved performance
         and other minor changes, none of which will delete any functionality.
         Improved performance will only be part of Updates, if and to the
         extent Siemens is contractually allowed to license such improvement
         to Stereotaxis. It is designated by a change in the second digit to
         the right of the decimal point in the Licensed Software version
         number.

<PAGE>

1.12 "Affiliate" shall mean a corporation, company or other entity

         (i)      more than fifty percent (50%) of whose outstanding shares or
                  securities representing the right to vote for the election of
                  the board of directors or a similar managing authority or a
                  supervisory board are, or

         (ii)     which does not have outstanding shares or securities, as may
                  be the case in a partnership, joint venture or unincorporated
                  association, but more than fifty percent (50%) of the
                  ownership interest representing the right to make decisions
                  for such entity is

         now or hereafter, owned or controlled directly or indirectly, by
         Stereotaxis or its parent companies or Siemens, respectively, but such
         corporation, company or other entity shall be deemed to be an Affiliate
         only so long as such ownership or control exists.

1.13     "Party" shall mean either Siemens or Stereotaxis.

1.14     "Parties" shall mean both Siemens and Stereotaxis.

ARTICLE 2 - LICENSE GRANT

2.1      Subject to the terms of this Agreement and without limiting the rights
         of the parties under the Extended Collaboration Agreement, Siemens
         hereby grants to Stereotaxis for the term of this Agreement subject to
         the payment of the license fees as set forth in Article 8 a
         non-exclusive, non-transferable, worldwide license to use, copy,
         distribute to End-users and to sublicense End-users the right to use
         the Licensed Software.

2.2      Subject to the terms of this Agreement, Siemens hereby grants to
         Stereotaxis for the term of this Agreement, subject to the payment of
         the license fees as set forth in Article 8, a non-exclusive,
         non-transferable, worldwide license to use, copy, change, translate and
         distribute to End-users the Software Documentation as part of an
         End-user manual that is handed over to the End-user. There shall be no
         reference in End-user manuals as to the origin of the Software
         Documentation.

<PAGE>
                                                          CONFIDENTIAL TREATMENT
                                                  REQUESTED BY STEREOTAXIS, INC.

2.3      Each licensing of Licensed Software to End-users shall be subject to
         legally binding, written license agreements the terms and conditions of
         which shall contain appropriate terms that are substantially similar to
         the terms of Articles 2, 3 and 11 of this Agreement.

2.4      If the Parties agree to incorporate freeware, shareware or open source
         software into the Licensed Software, no license fee shall be charged to
         Stereotaxis for the use of such freeware, shareware or open source
         software. Stereotaxis acknowledges and agrees that Siemens provides no
         warranties and shall have no liability whatsoever in respect of
         Stereotaxis's possession and/or use of the freeware, shareware or open
         source software. Regarding such portions of Licensed Software,
         Stereotaxis hereby accepts the specific license conditions either being
         part of the Software Documentation or accompanying the Hardware ("Open
         Source Conditions"). Upon request of Stereotaxis, Siemens shall provide
         a copy of the source code of the open source software, if required by
         the Open Source Conditions. To the extent there is a conflict between
         this Agreement and the Open Source Conditions, the terms of the Open
         Source Conditions shall prevail over the terms and conditions of this
         Agreement with regard to the open source software.

ARTICLE 3 -- COPYRIGHT, TRADEMARKS, TITLE

3.1      All rights, title and interest in and to the Licensed Software (and any
         part thereof) and the Software Documentation (and any part thereof),
         other than those expressly granted herein, shall remain wholly vested
         in Siemens or its third party licensors. Stereotaxis acknowledges that
         it has no rights whatsoever in respect of the Licensed Software and
         Software Documentation save for those expressly granted to it by this
         Agreement.

3.2      Nothing in this Agreement entitles either Party to use any trademark of
         the other Party or its Affiliates or any other mark confusingly similar
         thereto, without the express written consent of the other Party.

3.3      Stereotaxis shall in any case use reasonable efforts to safeguard the
         Licensed Software and the Software Documentation in its possession and
         control the rights therein with the same degree of case as is used with
         respect to Stereotaxis's own equally important software, documentation
         and rights therein, but at least with

<PAGE>

         reasonable care.

Other than as permitted hereunder, as contemplated under the Extended
Collaboration Agreement or required by law, Stereotaxis shall not copy,
translate, modify, create derivative works, disassemble, reverse engineer,
decompile, attempt, directly or indirectly, to otherwise obtain or create source
code of the Licensed Software or otherwise use the Licensed Software and
Software Documentation

3.4      Stereotaxis agrees that using, distributing, copying, duplicating or
         otherwise reproducing all or any part of the Licensed Software other
         than in accordance with this Agreement, and Stereotaxis's failure to
         perform its obligations for End-users as set forth in this Agreement,
         may be considered a material breach of this Agreement.

3.6      In case of Siemens' knowledge or reasonable assumption that, as a
         result of an action or inaction by Stereotaxis a third party is using
         or has used the Licensed Software or Software Documentation without
         proper authorization, then upon receipt of written request from
         Siemens, Stereotaxis shall confirm in writing whether such third party
         is an End-user or not. If such third party is an End-user, then Siemens
         and Stereotaxis shall mutually decide on the proper course of action to
         address the potential infringement. If such third party is not an
         End-user, then Stereotaxis shall reasonably assist Siemens in enforcing
         its rights (which assistance shall not include preparation for or
         participation in litigation) against such third party, and shall
         furnish all available information thereto which Stereotaxis is
         permitted to disclose.

ARTICLE 4 - SUPPLY OF LICENSED SOFTWARE AND SOFTWARE DOCUMENTATION

4.1      Siemens will supply to Stereotaxis the Object Code of the Licensed
         Software and Software Documentation on CD or other electronic form as a
         master copy. During the term of this Agreement, Stereotaxis may use,
         copy and distribute the Licensed Software and the Software
         Documentation. Stereotaxis shall provide to Siemens on a quarterly
         basis a list of the number of new End-users. Siemens may audit
         Stereotaxis in accordance with Section 9 below.

4.2      Siemens will without undue delay make available to Stereotaxis any new
         Update for licensing under the terms and conditions of this Agreement.

<PAGE>
                                                          CONFIDENTIAL TREATMENT
                                                  REQUESTED BY STEREOTAXIS, INC.

ARTICLE 5 - TIMELINES

         Both Parties will use commercially reasonable efforts to meet the
         timelines set forth in Annex 1. As part of these efforts, Siemens will
         support Stereotaxis, at no cost to Stereotaxis, in Stereotaxis's
         integration of the Licensed Software into the Product by providing
         assistance with respect to the Licensed Software, including, but not
         limited to, providing error corrections on a timely basis for any
         errors identified in the Licensed Software, during Stereotaxis's
         initial integration testing and subsequent Alpha and Beta testing with
         potential End-users.

ARTICLE 6 - WARRANTY

6.1      Siemens warrants that the Licensed Software: 1) is free of viruses
         and/or programming devices (e.g. license keys) that are designed to (a)
         disrupt the use of the Licensed Software, or any system with which the
         Software operates, or (b) destroy or damage data or make data
         inaccessible or delayed; and 2) as originally delivered by Siemens to
         Stereotaxis, is free from and will remain free from substantial
         non-conformities in design, material and workmanship during the
         warranty period of twelve months from the date of delivery. The
         Licensed Software is considered free from such non-conformities if it
         operates in substantial conformance with the Software Documentation. In
         the event of a breach of the foregoing warranties, Siemens shall
         perform maintenance service as defined in Article 10, below, at no cost
         to Stereotaxis or any End-user, during the warranty period of twelve
         months from the date of delivery and thereafter on a fee-paid basis as
         defined in Article 6.2, below.

6.2      With respect to an End-user, such cost-free maintenance period shall
         start at the time such End-user's sublicense of the Licensed Software
         commences for such End-user. The maintenance shall be provided without
         cost to Stereotaxis or its End-users for twelve (12) months from the
         End-user's sublicensing of the Licensed Software, after which Siemens
         may charge for its performance of maintenance services as described in
         Annex 5.

6.3      UNLESS EXPLICITLY STATED IN THIS AGREEMENT, SIEMENS MAKES NO WARRANTIES
         RELATED TO THE LICENSED SOFTWARE OR SOFTWARE DOCUMENTATION EITHER,
         EXPRESS, STATUTORY, OR IMPLIED INCLUDING

<PAGE>

         BUT NOT LIMITED TO THE IMPLIED WARRANTIES OF MERCHANTABILITY AND
         FITNESS FOR A PARTICULAR PURPOSE AND ANY IMPLIED WARRANTIES ARISING
         FROM COURSE OF DEALING OR USAGE OF TRADE.

ARTICLE 7 - INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES

7.1      (A) Except as set forth below in this Article, and subject to the
         conditions and limitations stated below in this Article, Siemens shall
         be liable for any claim, suit, action or proceeding brought against
         Stereotaxis, or an End-user, by a third party to the extent it is based
         on: a) any alleged infringement of patents, trademarks or copyrights of
         a third party and protected under the laws of the USA or Germany b) any
         alleged unlawful or improper disclosure or use or misappropriation of a
         trade secret; or (c) any alleged violation of any other intellectual
         property or moral right, in any such case, asserted against Stereotaxis
         or an End-user by virtue of Stereotaxis's or an End-user's use,
         distribution or possession of the Licensed Software or Software
         Documentation or respective updates as provided in this Agreement
         (hereinafter collectively referred to as "Claim(s)").

         (B) If, as a result of such a Claim, Stereotaxis becomes enjoined or it
         is likely, in Siemens' reasonable opinion, that Stereotaxis will become
         enjoined from using the Licensed Software, Software Documentation,
         Updates and/or Updated Software Documentation, Siemens shall at its
         election and its cost - except as set forth below in this Article, and
         subject to the conditions and limitations stated below in this Article:
         (i) procure for Stereotaxis the right to continue to use the Licensed
         Software, Software Documentation, Updates and/or Updated Software
         Documentation as provided in this Agreement; (ii) provide Stereotaxis
         with a non-infringing replacement product and/or documentation, or
         modify the Licensed Software, Software Documentation, Updates and/or
         Updated Software Documentation so that it becomes non-infringing,
         provided that the replacement/modified Licensed Software and/or Updates
         meet substantially the same performance and functional specifications
         provided in the Software Documentation or Updated Software
         Documentation; or, only if options (i) and (ii) are not possible
         despite the exercise of commercially reasonable efforts, (iii) upon
         return of the infringing Licensed Software at Siemens request, refund
         to Stereotaxis the purchase price actually paid. Except with respect to
         the obligations in the following paragraph (C), upon Siemens' execution
         of one of the options set out in this Section, Siemens shall be
         relieved of any further obligation or liability to Stereotaxis as a
         result

<PAGE>
                                                       CONFIDENTIAL TREATMENT
                                                    REQUEST BY STEREOTAXIS, INC.

         of any such infringement and Siemens shall not be obligated to deliver
         any replacement Licensed Software if Siemens has met the requirements
         to exercise option (iii) above. Any modified or replacement software
         and/or documentation provided under this Article 7 shall be subject to
         all of the terms and conditions of this Agreement, including without
         limitation, the provisions of this Article 7.

         (C) Siemens agrees to defend and to the extent a Claim is asserted
         against Stereotaxis or an End-user, indemnify and hold the End-user and
         Stereotaxis, its officers, directors, shareholders, agents and
         employees (collectively, "Stx Indemnified Parties") harmless from and
         against any and all loss, cost, damage or liability, including counsel
         fees and costs, arising out of or related to any Claim. Siemens shall
         control and direct the investigation, defense and settlement of each
         such Claim and Stereotaxis agrees, at Siemens' request and expense, to
         reasonably cooperate with Siemens in connection with the foregoing and
         in Siemens' efforts to mitigate any potential damages, costs and
         expenses incurred by Siemens under this provision.

7.2      Stereotaxis, the End-user and the Stx Indemnified Parties shall give
         Siemens prompt written notice of any alleged or threatened Claims.
         Stereotaxis, the End-user and the Stx Indemnified Parties shall not
         consent to any judgment or decree or compromise of any Claim without
         first obtaining Seimens' written consent. Siemens shall give prompt,
         written notice to Stereotaxis of any actual or threatened Claim against
         Siemens or customers of Siemens which Siemens, in its reasonable
         discretion, deems to be of importance to Stereotaxis.

7.3      Siemens shall not be liable with respect to any Claim to the extent
         arising out of our relating to either:

         (i)      use or incorporation in any Licensed Software of any design or
                  technique, furnished or requested by Stereotaxis or an
                  End-user; or

         (ii)     the combination with or incorporation of the Licensed Software
                  into the Product, software, or subassembly not supplied or
                  specified by Siemens if such infringement would not have
                  occurred without such combination or use thereof; or

         (iii)    the modification of Licensed Software by Stereotaxis or an
                  End-user unless such modification is in accordance with
                  Siemens' instructions; or

<PAGE>

         (iv)     the use of Licensed Software by Stereotaxis or an End-user
                  other than as permitted under this Agreement; or

         (v)      use or distribution by Stereotaxis of other than the most
                  current Update of the Licensed Software (if such Claim would
                  have been prevented by the use of such Update) after such
                  Update has been made available to Stereotaxis at no additional
                  charge.

7.4      (A) Except as set forth below in this Article, and subject to the
         conditions and limitations stated below in this Article, Stereotaxis
         shall be liable for any claim, suit, action or proceeding brought
         against Siemens by a third party to the extent it is based on: a) any
         alleged-infringement of patents, trademarks or copyrights of a third
         party and protected under the laws of the USA or Germany b) any alleged
         unlawful or improper disclosure or use or misappropriation of a trade
         secret; or (c) any alleged violation of any other intellectual property
         or moral right; in any such case, asserted against Siemens or one of
         the Siemens Indemnified Parties by virtue of Siemens' authorization of
         Stereotaxis for the use, incorporation, combination, distribution or
         possession of the Licensed Software or Software Documentation or
         respective updates as provided in this Agreement (hereinafter referred
         to as "Stx Claim(s)").

         (B) Stereotaxis agrees to defend and to the extent a Stx Claim is
         asserted against Siemens, indemnify and hold Siemens, its officers,
         directors, shareholders, agents, and employees ("Siemens Indemnified
         Parties") harmless from and against any and all loss, cost, damage or
         liability, including counsel fees and costs, arising out of or related
         to any Stx Claim. Stereotaxis shall control and direct the
         investigation, defense and settlement of each such Stx Claim and
         Siemens agrees, at Stereotaxis's request and expense, to reasonably
         cooperate with Stereotaxis in connection with the foregoing and in
         Stereotaxis's efforts to mitigate any potential damages, costs and
         expenses incurred by Stereotaxis under this provision.

7.5      Siemens shall give Stereotaxis prompt written notice of any alleged or
         threatened Stx Claims. Siemens shall not consent to any judgment or
         decree or compromise of any Stx Claim without first obtaining
         Stereotaxis's written consent. Stereotaxis shall give prompt, written
         notice to Siemens of any actual or threatened Stx Claim against
         Stereotaxis which Stereotaxis, in its reasonable discretion, deems to
         be of importance to Siemens.

<PAGE>
7.6      Stereotaxis shall not be liable with respect to any Stx Claim to the
         extent arising out of or relating to either:

         (i)      the modification of the Product by any person or entity other
                  than Stereotaxis or not in accordance with Stereotaxis's
                  instructions; or

         (ii)     use or modification in the Product of any design or
                  technique, furnished or requested by Siemens.

7.7      THE FOREGOING SECTIONS STATE THE ENTIRE LIABILITY OF EACH PARTY AND
         THE EXCLUSIVE PERFORMANCE REMEDY OF THE OTHER PARTY WITH RESPECT TO
         INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS, EITHER STATUTORY OR
         EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO ANY PATENT RIGHTS,
         COPYRIGHTS, UTILITY MODELS, DESIGN PATENTS, MASK WORK RIGHTS, MORAL
         RIGHTS, TRADE SECRETS, TRADEMARKS, TRADE NAMES, SERVICE MARKS,
         KNOW-HOW AND ANY OTHER SIMILAR RIGHTS OR INTANGIBLE ASSETS RECOGNIZED
         UNDER ANY LAWS OR INTERNATIONAL CONVENTIONS, AND IN ANY COUNTRY OR
         JURISDICTION IN THE WORLD AS INTELLECTUAL CREATIONS TO WHICH RIGHTS OF
         OWNERSHIP ACCRUE, AND ALL REGISTRATIONS, APPLICATIONS, DISCLOSURES,
         RENEWALS, EXTENSIONS, CONTINUATIONS OR REISSUES OF THE FOREGOING NOW
         OR HEREAFTER IN FORCE. EXCEPT AS EXPRESSLY STATED IN THIS AGREEMENT,
         ALL WARRANTIES AGAINST INFRINGEMENT OF INTELLECTUAL PROPERTY RIGHTS AS
         MENTIONED BEFORE ARE HERBY DISCLAIMED TO THE FULLEST EXTENT PERMITTED
         BY LAW.

7.8      Article 12 (Limitation of Liability) is applicable to Siemens' and
         Stereotaxis's liability under this Article 7. This Article 7 shall
         survive any termination or expiration of this Agreement.

ARTICLE 8 - PRICE, PAYMENT

8.1      As compensation for the license rights granted to Stereotaxis under
         this Agreement,
<PAGE>

         Stereotaxis agrees to pay to Siemens for each copy of the Licensed
         Software that has been licensed by Stereotaxis to and accepted by an
         End-user the license fees as stated in ANNEX 4 under terms and
         conditions detailed therein. There will be no license fee due during a
         trial period for an End-user, which shall not exceed six (6) months.

8.2      Siemens may issue invoices for fees and other amounts due hereunder
         quarterly for Licensed Software, as described in Section 8.1 above, and
         maintenance services. Such invoices shall regularly follow the receipt
         of the list of End-users provided by Stereotaxis in accordance with
         Section 4.1 above. Stereotaxis shall pay to Siemens all undisputed
         amounts set forth on each such invoice within thirty (30) days of
         Stereotaxis's receipt of such invoice.

8.3      Any payments to be made by Stereotaxis to Siemens under or in
         connection with this Agreement, shall be made by Stereotaxis to the
         following bank account of Siemens (until the next payment due after
         written notice of change is given by Siemens):

                                     [***]

8.4      If Stereotaxis fails to make any payment (other than payments
         reasonably disputed by Stereotaxis) in the manner described in this
         Article 8, i.e., within thirty (30) days of Stereotaxis's receipt of
         the corresponding invoice, then Siemens shall notify Stereotaxis in
         writing of the nature of such failure. If Stereotaxis fails to make
         such payment within thirty (30) days of Stereotaxis's receipt of such
         notice from Siemens that a payment has not been made within thirty (30)
         days of Stereotaxis's receipt of the corresponding invoice, then an
         interest at a rate of five percent (5%) per year above the 3 Month US $
         LIBOR rate shall be paid by Stereotaxis on such payment.

ARTICLE 9 - AUDITING RIGHTS

[*** 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.]
<PAGE>
                                                          CONFIDENTIAL TREATMENT
                                                     REQUESTED BY STEREOTAXIS, I

9.1      Stereotaxis shall keep records of all sublicenses granted to
         End-users. Siemens shall have the right to appoint an independent,
         certified public accounting firm, provided that such firm regularly
         performs audit work for Fortune 500 companies but is not the
         predominant accounting firm of Siemens, to audit such Stereotaxis
         records, as well as such other documents as may be reasonably required,
         solely for the purpose of verifying Stereotaxis's compliance with its
         Licensed Software-related payment obligations hereunder. Such audit
         shall be conducted upon at least five (5) business days notice, during
         Stereotaxis's normal working hours, at the Stereotaxis location where
         such records are maintained and in a manner that will not be unduly
         disruptive to Stereotaxis's operations. The auditor shall prepare a
         report either verifying such compliance or summarizing the total of any
         deviations therefrom, which report shall be furnished to each Party but
         shall be deemed to be the Confidential Information (as defined in
         Article 11 below) of Stereotaxis. Such audit shall be conducted no more
         often than once every twelve (12) months and shall be conducted at
         Siemens' expense, except in those cases where the auditor detects
         deviations that are greater than ten percent (10%) from Stereotaxis's
         payment obligations hereunder to the disadvantage of Siemens, in which
         latter case the cost of the audit shall be borne by Stereotaxis.

9.2      Any and all reports or records or notes other than the report
         mentioned in Section 9.1 above taken by the auditor shall not be
         disclosed to Siemens and shall be maintained by the auditor in
         confidence as Confidential Information of Stereotaxis, pursuant to a
         written agreement with Stereotaxis that is no less protective of
         Confidential information than the corresponding terms of this
         Agreement.

ARTICLE 10 - MAINTENANCE

10.1     Siemens shall provide software maintenance services as detailed in
         Annex 5. The maintenance services for the Licensed Software are subject
         to the maintenance fees set out in Annex 5, except as specified
         otherwise in Article 6 above.

10.2     Stereotaxis will communicate to Siemens suspected errors in the
         Licensed Software along with information reasonably requested by
         Siemens in order to reproduce the errors on the Reference Environment.
         Siemens agrees to respond and correct such
<PAGE>

         errors without undue delay.

10.3     The Parties will promptly notify each other of any suspected bugs or
         errors in the Licensed Software.

10.4     Notwithstanding any other provision of this Agreement, Siemens shall
         have no obligation to provide maintenance services:

         -    With respect to any non-Siemens computer programs, technology or
              hardware not provided by Siemens; or

         -    With respect to any Licensed Software that is not current within
              two (2) prior Updates of the most recent Updates.

10.5     Siemens represents and warrants that the maintenance services shall be
         provided in accordance with this Agreement and with reasonable care and
         skill.

ARTICLE 11 - CONFIDENTIALITY

11.1     Each Party acknowledges and agrees that it will have access to
         information, including, but not limited to, intellectual property,
         trade secrets, business, commercial or technical information, ideas,
         expressions and the terms of this Agreement, which are represented to
         be proprietary to the other Party, irrespective of the medium in which
         such information or data is embedded which shall - when disclosed in
         tangible form - be marked "Confidential" or with a similar legend by
         the disclosing Party or which shall - when disclosed orally or visually
         - be identified as such prior to disclosure and summarized in writing
         by the disclosing Party and said summary (which shall be marked
         "Confidential" or with a similar legend) is given to the receiving
         Party within thirty (30) days after such disclosure (hereinafter
         referred to as "Confidential Information"). In case of disagreement,
         the receiving Party must present its objections to the summary in
         writing within thirty (30) days of receipt. Confidential Information
         shall include any copies or abstracts made thereof as well as any
         apparatus, modules, samples, prototypes or parts thereof.

<PAGE>

                                                      CONFIDENTIAL TREATMENT
                                                  REQUESTED BY STEREOTAXIS, INC.

11.2     The terms and conditions of this Agreement shall be deemed to be
         Confidential Information of both Parties.

11.3     All Confidential Information exchanged between the Parties:

11.3.1   shall be used by the receiving Party exclusively for the purposes of
         this Agreement, unless otherwise expressly agreed to in writing by the
         disclosing Party;

11.3.2   shall during the term of the Agreement and for a period of 5 years
         after its termination or expiration not be distributed or disclosed in
         any way or form by the receiving Party to anyone except its employees
         or those of an Affiliate, consulting firm, counsel or other
         professional advisors who reasonably need to know such Confidential
         Information for the purposes of this Agreement and who are bound to
         confidentiality either by their employment agreement or otherwise that
         is substantially similar to the confidentiality obligations under this
         Agreement. Prior to any disclosure to its Affiliates or to its
         consulting firms, the receiving Party must have an appropriate
         agreement with any such Affiliate or any such consulting firm
         sufficient to require the Affiliate or the consulting firm to treat
         Confidential Information in accordance with this Agreement. Any
         unauthorized disclosure of the disclosing Party's Confidential
         Information by the receiving Party, its Affiliates or Affiliates'
         employees or by its consultants shall constitute a breach of this
         Agreement by the receiving Party;

11.3.3   shall be treated by the receiving Party with the same degree of care as
         is used with respect to the receiving Party's own equally important
         confidential information of a similar nature to avoid disclosure to any
         third party, but at least with reasonable care; and

11.3.4   shall remain the property of the disclosing Party.

11.4     The obligations of Section 11.3 above shall, however, not apply to any
         Confidential Information which:

11.4.1   was lawfully in the receiving Party's possession without
         confidentiality obligation prior to receipt from the disclosing Party;

11.4.2   is at this time of disclosure already in the public domain or becomes
         available to the public through no breach by the receiving Party;
<PAGE>

11.4.3   is lawfully obtained by the receiving Party from a third party without
         an obligation of confidentiality, provided such third party is not, to
         the receiving Party's knowledge, in breach of any confidentiality
         obligation relating to such information;

11.4.4   is developed by the receiving Party or its Affiliates independently
         from and without reference to such Confidential Information;

11.4.5   was approved for release by written agreement with the disclosing
         Party.

11.5     The receiving Party will derive no rights of any kind, in particular no
         rights of prior use, from the fact that they as a result of the
         Confidential Information may possibly obtain knowledge of patentable
         inventions for which the disclosing Party may possibly apply for
         intellectual property rights.

11.6     Upon any termination or expiration of this Agreement, unless otherwise
         instructed in writing by the disclosing Party, the receiving Party
         shall cease using any Confidential Information of the disclosing Party
         including such Confidential Information on record-bearing media, as
         well as any copies thereof. Upon request of the disclosing Party, made
         in writing to the receiving Party within ninety (90) days after
         termination of this Agreement the receiving Party shall as per the
         notice either return such Confidential Information to the disclosing
         Party or destroy it. This shall not apply to routinely made back-up
         copies of electronically-exchanged data. In case of a destruction, the
         receiving Party shall confirm in writing such destruction to the
         disclosing Party within fourteen (14) days after receipt of the
         respective request.

11.7     The receiving Party shall not be considered to have breached its
         obligations under this Article for disclosing Confidential Information
         of the other Party if such disclosure is required by law or regulation,
         government authority, duly authorized subpoena or court order or
         regulatory request. Promptly upon receiving notice of any such
         requirement or request and to the extent that it may legally do so,
         such Party shall take reasonable commercial efforts to advise the other
         Party of the required disclosure prior to making such disclosure in
         order to afford the other Party a reasonable opportunity to take such
         action as it deems appropriate to protect such Confidential
         Information.

<PAGE>

Article 12 - Limitation of Liability

12.1     Each Party will without limit be liable for personal injury for which
         such Party can be held responsible. Each Party will be liable for
         damages to the other Party's property for which such Party can be held
         responsible up to a maximum amount of [***] Euro [***] per damage
         event.

12.2     SUBJECT TO THE EXCLUSION OF EACH PARTY'S INDEMNIFICATION OBLIGATIONS
         HEREUNDER, NEITHER PARTY SHALL BE LIABLE, WHETHER IN CONTRACT,
         WARRANTY, TORT (INCLUDING NEGLIGENCE OR STRICT LIABILITY), OR ANY OTHER
         LEGAL OR EQUITABLE THEORY FOR DAMAGE TO OR LOSS OF OTHER PROPERTY OR
         EQUIPMENT, BUSINESS INTERRUPTION OR LOST REVENUE, LOSS OF PROFITS OR
         SALES, COST OF CAPITAL, FOR ANY LOSS OF USE, FOR ANY LOSS OR CORRUPTION
         OF DATA OR FOR ANY SPECIAL, INCIDENTAL, PUNITIVE, INDIRECT OR
         CONSEQUENTIAL DAMAGES OR FOR ANY OTHER LOSS, COSTS OR EXPENSES OF A
         SIMILAR TYPE, EVEN IF THE PARTY SOUGHT TO BE HELD LIABLE HAS BEEN
         ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

12.3     THE LIABILITY OF EACH PARTY FOR ANY ACT OR OMISSION, OR WITH RESPECT TO
         LICENSED SOFTWARE FURNISHED AS WELL AS SERVICES RENDERED UNDER THIS
         AGREEMENT, WHETHER IN CONTRACT, WARRANTY, TORT (INCLUDING NEGLIGENCE OR
         STRICT LIABILITY), INDEMNITY, OR ANY OTHER LEGAL OR EQUITABLE THEORY,
         WILL IN NO EVENT EXCEED [***] EURO [***] FOR ALL LIABILITY IN THE
         AGGREGATE.

12.4     The rights and remedies explicitly contained in this Agreement are
         exclusive, not cumulative and the Parties accept these remedies in
         lieu of all rights and remedies available at law or otherwise, in
         contract (including warranty) or in tort (including negligence), for
         any and all claims of any nature arising under this Agreement or any
         performance or breach arising out of this Agreement.

12.5     This Article 12 shall survive any 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.]

<PAGE>

ARTICLE 13 - FORCE MAJEURE

         Neither Party shall be liable to the other for failure or delay in the
         performance of any of its obligations under this Agreement for the time
         and to the extent such failure or delay is caused by events or
         circumstances beyond the Party's reasonable control such as, but not
         limited to, riots, civil commotions, wars, strikes, lock-outs,
         hostilities between nations, governmental laws, orders or regulations,
         actions by the government or any agency thereof, storms, fires,
         sabotages, explosions or any other contingencies beyond the reasonable
         control of the respective Party and of its sub-contractors (hereinafter
         referred to as "Force Majeure"). In such events, the affected Party
         shall immediately inform the other Party of such circumstances together
         with documents of proof and the performance of obligations hereunder
         shall be suspended during, but not longer than, the period of existence
         of such cause and the period reasonably required to perform the
         obligations in such cases. Unavailability of funds shall not be deemed
         Force Majeure. Notwithstanding the foregoing, the non-affected Party
         may, in its sole discretion, terminate this Agreement if the period of
         delay exceeds six (6) months.

ARTICLE 14 - ARBITRATION

14.1     Any differences or disputes arising from this Agreement or from
         agreements regarding its performance shall be settled by an amicable
         effort on the part of both parties to the Agreement. An attempt to
         arrive at a settlement shall be deemed to have failed as soon as one of
         the parties to the Agreement so notifies the other party in writing.

14.2     If an attempt at settlement has failed, the disputes shall be finally
         settled under the Rules of Conciliation and Arbitration of the
         International Chamber of Commerce in Paris (Rules) by three arbitrators
         appointed in accordance with the Rules.

14.3     The place of arbitration shall be Berne, Switzerland. The procedural
         law of this place shall apply where the Rules are silent.

14.4     The arbitral award shall be substantiated in writing. The arbitral
         tribunal shall decide on the matter of costs of the arbitration.
<PAGE>
                                                          CONFIDENTIAL TREATMENT
                                                  REQUESTED BY STEREOTAXIS, INC.

ARTICLE 15 -- SUBSTANTIVE LAW

         All disputes shall be settled in accordance with the provisions of this
         Agreement and all other agreements regarding its performance, otherwise
         in accordance with the substantive law in force in the Canton of Berne,
         Switzerland, without reference to other laws.

ARTICLE 16 -- TERM OF THE AGREEMENT

         16.1  This Agreement shall commence on the Effective Date and remain in
               effect for a period of six (6) years thereafter, unless
               terminated earlier by either Party as hereinafter provided, and
               shall automatically be renewed for consecutive one (1) year
               periods unless either Party provides written notice to the other
               Party of an intention not to renew at least ninety (90) days
               prior to the end of the original six (6) year period or any
               subsequent one (1) year renewal periods (the original period
               along with any extension periods, the "Term").

         16.2  The rights to use paid-up copies of the Licensed Software will
               not be affected by the expiration hereof pursuant to Section 16.1
               of this Agreement.

ARTICLE 17 -- TERMINATION

         17.1  This Agreement may by written notice be forthwith terminated by a
               Party having such right as herein provided -- and save of any
               other rights such Party may have -- upon the occurrence of either
               one or more of the following events stated below:

               --  by either Party in the event that the other Party has failed
                   in the performance of any material obligation under this
                   Agreement by giving not less than forty-five (45) days
                   written notice specifying any such breach (hereinafter
                   referred to as "Notice") unless within the period of such
                   Notice all breaches specified shall have been remedied or a
                   plan for remedying such breaches has been proposed by the
                   other Party and has been accepted by the first Party
                   mentioned during such forty-five (45) day period, with the
                   understanding that Notice shall not be required for

<PAGE>

               any failure in the performance of any material obligation under
               this Agreement which cannot be remedied or which relates to
               Siemens' warranty or support obligations under this Agreement; or

          -    by either Party in the event that the other Party voluntarily
               files a petition in bankruptcy or has such a petition
               involuntarily filed against it (which petition is not discharged
               within sixty (60) days after filing), or is placed in an
               insolvency proceeding, or if an order is issued appointing a
               receiver or trustee or a levy or attachment is made against a
               substantial portion of its assets which order shall not be
               vacated, or set aside within sixty (60) days from date of
               issuance, or if any assignment for the benefit of its creditors
               is made, or

          -    by either Party if there is a change in control of the other
               Party which in the reasonable opinion of the terminating Party
               adversely affects such Party's position, rights or interests.

17.2     Upon termination or expiration of this Agreement, Stereotaxis shall
         promptly pay Siemens any undisputed amounts due to Siemens and cease
         any use of the Licensed Software, including copies thereof and Software
         Documentation in Stereotaxis's possession. Notwithstanding the
         foregoing, Stereotaxis may continue to provide Licensed Software
         support (including previously received Updates) to existing End-users
         for a period not to exceed six (6) months after such termination or
         expiration but may not sublicense the Licensed Software to any new
         End-users and Siemens is not obligated to provide any continuing
         support. All obligations of either Party accrued prior to termination,
         and those obligations relating to confidentiality, protection of the
         Software and the Software Documentation and restriction to use shall
         survive termination. Any sublicenses granted to End-users prior to the
         termination or expiration of this Agreement shall not be affected by
         such termination or expiration.

ARTICLE 18 - EXPORT REGULATIONS

         Stereotaxis shall comply with all export laws applicable to the
         Licensed Software and/or the Software Documentation in effect from time
         to time. Without limiting the generality of the foregoing, Stereotaxis
         expressly warrants that it will not directly or indirectly

<PAGE>

                                                          CONFIDENTIAL TREATMENT
                                                  REQUESTED BY STEREOTAXIS, INC.

         export, re-export, or tranship the Licensed Software or the Software
         Documentation in violation of any export laws, rules or regulations of
         Germany or the United States.

         Stereotaxis when sublicensing the Licensed Software to End-users shall
         also oblige such End-users to adhere to the aforementioned export
         provision.

         The Licensed Software has no bit encryption.

ARTICLE 19 - MISCELLANEOUS

19.1     Each Party shall name to the other authorized representatives forthwith
         after signing of the Agreement who shall bring about any and all
         decisions in connection with the performance of this Agreement.

19.2     This Agreement shall not be modified or amended except by a written
         agreement dated subsequently to the date of this Agreement and signed
         on behalf of Siemens and Stereotaxis by their respective duly
         authorized representatives as an amendment hereto. This requirement of
         written form can only be waived in writing.

19.3     All Annexes shall be considered as an integral part of this Agreement.

19.4     If Stereotaxis licenses Licensed Software, including Software
         Documentation, to the US Government, the following provisions apply: if
         Licensed Software is supplied to the Department of Defense ("DOD"),
         Licensed Software is subject to "Restricted Rights" including a legend
         to be affixed to the Licensed Software, as that term is defined in the
         DOD Supplement to the Federal Acquisition Regulations ("DFAR") in
         paragraph 252.227-7013(c)(1); if Licensed Software is supplied to any
         unit or agency of the US Government other than DOD, the US Government's
         rights in the Licensed Software will be as defined in paragraph
         52.227-19(c)(2) of the Federal Acquisition Regulations ("FAR"). Any
         failure by Siemens to affix a Restricted Rights legend on Licensed
         Software shall not be deemed to constitute a waiver of any obligation
         of Stereotaxis imposed by this Agreement.

         Under no circumstances shall Siemens be obligated to comply with any
         requirements imposed by the US Government regarding submission of, or
         the request for exemption

<PAGE>

         from, submission of cost or pricing data or cost accounting
         requirements for any distribution or license of Licensed Software that
         would require compliance by Siemens with US Governmental requirements
         relating to cost or pricing data or cost accounting requirements.

19.5     Nothing contained in this Agreement shall be construed as creating a
         joint venture, partnership or employment relationship. Except as
         specified herein, neither Party shall have the right, power or implied
         authority to create any obligation or duty, express or implied, on
         behalf of the other Party hereto.

19.6     Press releases or other information on the conclusion or content of
         this Agreement shall only be made available to third parties, in
         particular press agencies, with the prior written consent of the other
         Party hereto, provided, however, Stereotaxis may disclose this
         Agreement to third parties that have a sincere interest in acquiring
         Stereotaxis or any share of the company exceeding 5% under an
         obligation of confidentiality not less stringent than the provisions
         provided for in Article 11 for purposes of legal or financial due
         diligence after informing Siemens in detail of such event. Neither
         Party will use any of the other Party or its Affiliates' trademarks,
         trade names or representations of the other Party or its Affiliates'
         products or services, or refer directly or indirectly to the other
         Party or its Affiliates', or the products or services of either in
         order to make known and/or publicize its relationship with the other
         Party or its Affiliates' without, in any case, obtaining the prior
         written permission of the other Party and its parent companies, if any.

<PAGE>
                                                          CONFIDENTIAL TREATMENT
                                                  REQUESTED BY STEREOTAXIS, INC.

19.7     Notices and communications between Stereotaxis and Siemens shall be
         given in writing or by e-mail or facsimile in English language to the
         following addresses of the Parties or to such other address as the
         party concerned may subsequently notify in writing to the other Party:

         If to Stereotaxis:

         Stereotaxis, Inc.
         4041 Forest Park Avenue
         St. Louis, MO 63108
         Attention: Chief Executive Officer and Sr. Vice President of Research
                    & Development
         Tel. 314-615-6940
         Fax 314-615-6922

         and, if to Siemens:

         Siemens Aktiengesellschaft
         Attn.: Dr. Reinmar Killmann
         SiemensstraBe 1
         91301 Forchheim
         Germany
         Tel. +49 (9191) 18 8979
         Fax +49 (9191) 18 8951
         E-Mail reinmar.killmann@siemens.com

19.8     A waiver of any default by either Party of any of the terms and
         conditions of this Agreement shall not be deemed to be a continuing
         waiver or a waiver of any other provisions of this Agreement, but shall
         apply solely to the instances to which such waiver is granted.

19.9     Should individual provisions of this Agreement be illegal or
         unenforceable for legal reasons then, unless the basic intentions of
         the Parties under this Agreement are materially altered, the validity
         of the remaining provisions of this Agreement shall not be
<PAGE>

         affected thereby. In such a case the Parties shall come to an agreement
         approximating as closely as possible the arrangement originally
         envisaged in this Agreement.

19.10    The titles to the Articles of this Agreement are for convenience or
         reference only and are not part of this Agreement and shall not in any
         way affect the interpretation thereof.

19.11    This Agreement constitutes the entire agreement between the Parties
         hereto with respect to the subject matter hereof and supersedes all
         previous communications, representations, understanding and agreements,
         either oral or written, between the Parties with respect to such
         subject matter hereof. Notwithstanding the foregoing, this Agreement
         shall not alter or amend the rights or obligations of either party as
         set forth in and provided under the Extended Collaboration Agreement.

19.12    Neither the rights nor the obligations of this Agreement may be
         assigned or transferred in any manner, except with the prior written
         consent of the other Party or except as part of a transfer of all or of
         a substantial part of the activities to which the subject matter of
         this Agreement pertains whether by sale, merger or consolidation,
         provided, however, that either Party may assign any and all of its
         rights and obligations without the prior written consent of the other
         Party to an Affiliate. In case of such a transfer the respective Party
         shall ensure that the transferee, assignee or successor will comply
         with the terms of this Agreement.

19.13    Siemens agrees to discuss with Stereotaxis any plans that Siemens may
         now or in the future have to create upgrades that are not specified in
         Annex 1 of the Licensed Software and to offer Stereotaxis the ability
         to negotiate the functionality of any such upgrades on reasonable terms
         and conditions to be agreed upon by the Parties.

19.14    By the signature of each of the representatives of the Parties placed
         on this Agreement, each such signatory represents and warrants that he
         or she is authorized to sign this Agreement on behalf of the Party for
         whom he or she is acting.

<PAGE>
                                                          CONFIDENTIAL TREATMENT
                                                  REQUESTED BY STEREOTAXIS, INC.

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be signed
by their respective duly authorized representatives.

Date:                                     Date: 3-March-2004

Stereotaxis Inc.                          Siemens Aktiengesellschaft

/s/ Michael P. Kaminski                   /s/ Dr. Reinmar Killmann
-------------------------                 ----------------------------------
Name:  Michael P. Kaminski                Name:  Dr. Reinmar Killmann
Title: COO                                Med AX PLM-I FC

                                          /s/ Dr. Ralf Thomas
                                          ----------------------------------
                                          Name:  Dr. Ralf Thomas
                                          Med KL AX

<PAGE>

ANNEX 1: "LICENSED SOFTWARE"

1. FUNCTIONALITY

The requirements of the Licensed Software are described in the following
document:

Requirement Specification "3D Pre-Operative Image Navigation", V1.0, by Walter
Blume and Jan Boese, released 22.05.2003, signed by Siemens AX, Stereotaxis and
Siemens SCR.

2.DELIVERY

 The Licensed Software will be delivered via CD-ROM. The delivery will include:

     -    binaries (e.g. executables, libraries, OCXs, lib-files, dll-files)

     -    include files

     -    documentation (see Annex 2)

     -    software containing application examples for using the interfaces of
          delivered components

3.SOFTWARE ENVIRONMENT

 The Licensed Software will run under Windows 2000. The Licensed Software is
 intended to run as a component (library) of the software of the Product.

<PAGE>

                                                      CONFIDENTIAL TREATMENT
                                                  REQUESTED BY STEREOTAXIS, INC.

ANNEX 2: "SOFTWARE DOCUMENTATION"

Software Documentation will be delivered as follows:

- Detailed description of the programming interface

  This description will be delivered in form of header files containing
  description of functions and variables.

<PAGE>

ANNEX 3: HARDWARE

The Licensed Software will run as part of the Product on the Product hardware
platform, which is as follows:

PC with the following properties (minimal configuration):

-        CPU                 Intel P4 2GHz

-        Memory              1 Gb Kingston DDR RAM (2x512)

-        CD.RW               IDE 12*10*32 (At least)

-        Graphics Card       OpenGI support of 3d texture rendering required

<PAGE>
                                                      Confidential Treatment
                                              Requested by Stereotaxis, Inc.

ANNEX 4: LICENSE FEES

Fee for one license: [***]

Invoices will be issued in Euro.

[*** 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.]
<PAGE>

ANNEX 5: MAINTENANCE SERVICES AND MAINTENANCE FEES

1. MAINTENANCE SERVICES

Maintenance service covers:

     -    Error correction

     -    Migration to higher versions of Windows compatible operating systems

     -    Migration to higher versions of the DICOM standard in order to
          read/import the actual version of single, static, uncompressed cardiac
          3D DICOM images (CT, MR)

     -    Vendor-required hardware changes

2. MAINTENANCE FEES

Maintenance service is free for 12 months after sublicensing, as per Article 6
above.

     -    Maintenance fee for one license is [***] E per year.

     -    The above maintenance fees are mandatory for the first three years
          after the one-year period of cost-free maintenance as described in
          article 6.2.

     -    Stereotaxis has the option to extend this pricing after the first
          mandatory 3 years on yearly basis on unchanged conditions (concerning
          maintenance service and maintenance fees) through no less than the end
          of the original six (6) year period of the Term.

3. HOURLY SERVICE

     -    If maintenance service is required due to an event at an End-user site
          at which no service and maintenance contract is in effect between
          Stereotaxis and Siemens (i.e. if the maintenance contract is not
          prolonged after the 3 years of mandatory maintenance), Siemens will
          provide this service to Stereotaxis at an hourly rate of [***] E. This
          service will be provided by Siemens through any of its Affiliates
          deemed to be appropriate by Siemens. This price shall be fixed until
          the end of the original six (6) year period of the Term and subject to
          renegotiation thereafter.

Invoices will be issued in Euro

[*** 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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