Document:

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                                                                   EXHIBIT 10.21

AGREEMENT dated January ___, 2001, between ReTrac Medical, Inc. (the
"Company"), and Mr. John J. Scally, Jr. (the "Advisory Board Member").

                                    RECITALS

The Company is currently in the process of developing its business and requires
certain knowledge and experience to assist and guide the Company in its growth
and strategy.

Mr. Scally has the knowledge and extensive experience the Company requires.

The Company desires to have Mr. Scally assume the role of member of the
Financial Advisory Board to assist and guide the Company in developing its
business, growth and strategy for a maximum period of three years.

Mr. Scally for certain consideration hereinafter defined, accepts the position
of Advisory Board Member of the Financial Advisory Board for a three year
period.

NOW THEREFORE subject to ratification by the Board of Directors, and any
amendments to the by-laws that may be required, the parties hereto agree as
follows.

1. POSITION.

Mr. Scally shall assume the role of member of the Financial Advisory Board.

2. TERM.

The term of this Agreement shall begin on January, 2001, the effective date,
and shall terminate on January, 2004.

3. DUTIES.

The Advisory Board Member shall devote a sufficient amount of his time and
attention to the Company`s business and shall be available to the management of
the Company to assist and guide the Company in its growth and strategy.

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4. COMPENSATION.

The Advisory Board Member shall receive no compensation for his services as
Advisory Board Member.

5. STOCK.

As a one-time consideration for the signing of this agreement the Company agrees
to issue the Advisory Board Member ten thousand (10,000) shares of the Company's
common stock. Such stock shall be, and is, separate and apart from any other
stock issued, or to be issued, the Advisory Board Member under any other
agreement. The Advisory Board Member shall execute the Acknowledgment of Stock
Restriction attached hereto as Exhibit A.

6. EXPENSES.

The Advisory Board Member may incur reasonable expenses for promoting the
Company's business, including expenses for entertainment, travel, and similar
items. The Company will reimburse the Advisory Board Member for all such
expenses upon periodic presentation of an itemized account of such expenditures.

7. TERMINATION.

The Advisory Board Member may, without cause, terminate this Agreement by giving
60 days written notice to the Company of such termination or resignation of his
position. In such event, the Advisory Board Member shall continue to render his
services up to the date of termination or resignation.

8. INDEMNITY.

The Company hereby agrees to hold the Advisory Board Member harmless for any and
all liabilities that may arise from the actions of the Company prior to the
effective date of this agreement.

9. NOTICES.

Any notice required or desired to be given under this Agreement shall be deemed
given if in writing and sent by certified mail, return receipt requested, to:

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The Advisory Board Member at

Mr. John J. Scally, Jr.
30 The Crescent
Short Hills, NJ 07078

The Company at

ReTrac Medical, Inc.
22 South Main Street
New City, NY 10956

10. WAIVER OF BREACH.

The Company's waiver of a breach of any provision of this Agreement by the
Advisory Board Member shall not operate or be construed as a waiver of any
subsequent breach by the Advisory Board Member. No waiver shall be valid unless
in writing and signed by an authorized officer of the Company.

11. ASSIGNMENT.

The Advisory Board Member acknowledges that his services are unique and
personal. Accordingly, the Advisory Board Member may not assign his rights or
delegate his duties or obligations under this Agreement. The Company's rights
and obligations under this Agreement shall inure to the benefit of, and shall be
binding upon, the Company's successors and assigns.

12. ENTIRE AGREEMENT.

This Agreement contains the entire understanding of the parties. It may not be
changed orally but only by an agreement in writing signed by the party against
whom enforcement of any waiver, change, modification, extension, or discharge is
sought.

13. HEADINGS.

Headings in this Agreement are for convenience only and shall not be used to
interpret or construe its provisions.

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14. COUNTERPARTS.

This Agreement may be executed in two or more counterparts, each of which shall
be deemed an original but all of which together shall constitute one and the
same instrument.

In witness whereof the parties have executed this Agreement on the __ day of
January, 2001.

The Advisory Board Member

/S/ John J. Scally, Jr.
-----------------------
John J. Scally, Jr.

ReTrac Medical, Inc., by

/S/ Thomas Sassone
------------------
Thomas Sassone, President/CEO

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                       ACKNOWLEDGMENT OF STOCK RESTRICTION
                       -----------------------------------

The Shares to be issued in accordance with the agreement of date January __,
2001, between ReTrac Medical, Inc. and John J. Scally, Jr. will not have been
registered under the Securities Act of 1933, as amended, or registered or
qualified under any state securities laws, and as such, the Shares are and will
be restricted securities as such term is defined under the Securities Act of
1933, and the Shares will be issued in a transaction exempt from the
registration requirements of the 1933 Act and the registration or qualification
requirements of applicable state securities laws. The Shares will be and will
have been acquired by John J. Scally, Jr. for investment purposes only and not
with a view to distribution or resale and may not be made subject to a security
interest, pledge, hypothecated, sold or otherwise transferred unless such Shares
are subsequently registered in accordance with the 1933 Act and qualified or
registered under applicable state securities laws or an exemption from
registration and qualification is available, and that, except as otherwise
provided in this Agreement, the Company is under no obligation to register or
qualify the Shares. The Company may require an opinion of it counsel prior to
authorizing the registration of any transfer of the Shares in reliance on an
exemption from registration or qualification to the effect that the transfer is
exempt from such registration or qualification. Certificates evidencing the
Shares shall bear a standard form Securities and Exchange Commission restrictive
legend and any such other legends as required by applicable federal and state
laws, and the transfer agent for the Company's class of Common Shares shall be
instructed to place a stop transfer order on the stock books of the Company
restricting the transfer of the Shares.

John J. Scally, Jr. represents and warrants that he agrees to execute such other
documents and instruments as counsel for the Company reasonably deems necessary
to effect the compliance of the issuance of the Shares with federal and state
laws or the enforce the intent of the agreement.

Dated:    January    , 2001

/s/ John J. Scally, Jr.
-----------------------
John J. Scally, Jr.<PAGE>

                                                                   EXHIBIT 10.17

                              SECURITY AGREEMENT

     This Security Agreement is made as of January 4, 2001 between Curon
Medical, Inc., a Delaware corporation ("Pledgee"), and ("Pledgor").

     1.   Note Issuance. Pledgee has agreed to lend Pledgor $150,000 pursuant to
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a promissory note (the "Note"). The Note and the obligations thereunder are as
set forth in Exhibit A to this Security Agreement.
             ---------

     2.   Creation and Description of Security Interest. Pledgor, pursuant to
          ---------------------------------------------
the California Commercial Code, hereby pledges 37,500 shares of Common Stock in
Pledgee (herein sometimes referred to as the "Collateral" or the "Pledged
Stock") represented by certificate number 0152 for 28,500 shares and 0153 for
9,000 shares and herewith delivers said certificates to the Secretary of Pledgee
("Pledgeholder"), who shall hold said certificates subject to the terms and
conditions of this Security Agreement.

     The pledged stock (together with an executed blank stock assignment
attached hereto as Exhibit B for use in transferring all or a portion of the
                   ---------
Shares to Pledgee if, as and when required pursuant to this Security Agreement)
shall be held by the Pledgeholder as security for the repayment of the Note, and
any extensions or renewals thereof, and the Pledgeholder shall not encumber or
dispose of such Shares except in accordance with the provisions of this Security
Agreement.

     3.   Pledgor's Representations and Covenants. To induce Pledgee to enter
          ---------------------------------------
into this Security Agreement, Pledgor represents and covenants to Pledgee, its
successors and assigns, as follows:

          (a)    Payment of Indebtedness. Pledgor will pay the principal sum of
                 -----------------------
the Note secured hereby, together with interest thereon, at the time and in the
manner provided in the Note.

          (b)    Encumbrances. The Shares are free of all other encumbrances,
                 ------------
defenses and liens, and Pledgor will not further encumber the Shares without the
prior written consent of Pledgee.

          (c)    Margin Regulations. In the event that Pledgee's Common Stock is
                 ------------------
now or later becomes margin-listed by the Federal Reserve Board and Pledgee is
classified as a "lender" within the meaning of the regulations under Part 207 of
Title 12 of the Code of Federal Regulations ("Regulation G"), Pledgor agrees to
cooperate with Pledgee in making any amendments to the Note or providing any
additional collateral as may be necessary to comply with such regulations.

     4.   Voting Rights. During the term of this pledge and so long as all
          -------------
payments of principal and interest are made as they become due under the terms
of the Note, Pledgor shall have the right to vote all of the Shares pledged
hereunder.

     5.   Stock Adjustments. In the event that during the term of the pledge any
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stock dividend, reclassification, readjustment or other changes are declared or
made in the capital structure of Pledgee, all new, substituted and additional
shares or other securities issued by reason of any such change shall be
delivered to and held by the Pledgee under the terms of this Security Agreement
in
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the same manner as the Shares originally pledged hereunder. In the event of
substitution of such securities, Pledgor, Pledgee and Pledgeholder shall
cooperate and execute such documents as are reasonable so as to provide for the
substitution of such Collateral and, upon such substitution, references to
"Shares" in this Security Agreement shall include the substituted shares of
capital stock of Pledgor as a result thereof.

     6.   Default. Pledgor shall be deemed to be in default of the Note and of
          -------
this Security Agreement in the event that payment of principal or interest on
the Note shall be delinquent for a period of 30 days or more. In the case of
default, Pledgee shall have the right to accelerate payment of the Note upon
notice to Pledgor, and Pledgee shall thereafter be entitled to pursue its
remedies under the California Commercial Code.

     7.   Release of Collateral.  Subject to any applicable contrary rules under
          ---------------------
Regulation G, there shall be released from this pledge a portion of the Pledged
Shares held by Pledgeholder hereunder upon payments of the principal of the
Note. The number of the Pledged Shares which shall be released shall be that
number of full shares which bears the same proportion to the initial number of
shares pledged hereunder as the payment of principal bears to the initial full
principal amount of the Note.

     8.   Withdrawal or Substitution of Collateral. Pledgor shall not sell,
          ----------------------------------------
withdraw, pledge, substitute or otherwise dispose of all or any part of the
Collateral without the prior written consent of Pledgee.

     9.   Term. The within pledge of Shares shall continue until the payment of
          ----
all indebtedness secured hereby, at which time the remaining pledged stock shall
be promptly delivered to Pledgor, subject to the provisions for prior release of
a portion of the Collateral as provided in paragraph 7 above.

     10.  Insolvency. Pledgor agrees that if a bankruptcy or insolvency
          ----------
proceeding is instituted by or against it, or if a receiver is appointed for the
property of Pledgor, or if Pledgor makes an assignment for the benefit of
creditors, the entire amount unpaid on the Note shall become immediately due and
payable, and Pledgee may proceed as provided in the case of default.

     11.  Pledgeholder Liability. In the absence of willful or gross negligence,
          ----------------------
Pledgeholder shall not be liable to any party for any of his acts, or omissions
to act, as Pledgeholder.

     12.  Invalidity of Particular Provisions. Pledgor and Pledgee agree that
          -----------------------------------
the enforceability or invalidity of any provision or provisions of this Security
Agreement shall not render any other provision or provisions herein contained
unenforceable or invalid.

     13.  Successors or Assigns. Pledgor and Pledgee agree that all of the terms
          ---------------------
of this Security Agreement shall be binding on their respective successors and
assigns, and that the term "Pledgor" and the term "Pledgee" as used herein shall
be deemed to include, for all purposes, the respective designees, successors,
assigns, heirs, executors and administrators.

     14.  Governing Law. This Security Agreement shall be interpreted and
          -------------
governed under the internal substantive laws, but not the choice of law rules,
of California.

                                      -2-
<PAGE>

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.

PLEDGOR                            /s/ David S. Utley, M.D.
                                   ---------------------------------------------
                                   David S. Utley, M.D.

                                   Address:   ______________________________

                                              ______________________________

PLEDGEE                            CURON MEDICAL, INC.
                                   a Delaware corporation

                                   /s/ John W. Morgan
                                   ---------------------------------------------
                                   John W. Morgan, President and CEO

PLEDGEHOLDER                       /s/ David J. Saul
                                   ---------------------------------------------
                                   Secretary of Curon Medical, Inc.

                                      -3-
<PAGE>

                                   EXHIBIT A
                                   ---------

                                     NOTE

$150,000.00                                                Sunnyvale, California
                                                                 January 4, 2001

     FOR VALUE RECEIVED, David S. Utley, M.D., promises to pay to Curon Medical,
Inc., a Delaware corporation (the "Company"), or order, the principal sum of One
Hundred and Fifty Thousand dollars ($150,000), together with interest on the
unpaid principal hereof from the date hereof at the rate of six percent (6.0%)
per annum, compounded annually.

     Principal and interest shall be due and payable on January 4, 2003.
Payment of principal and interest shall be made in lawful money of the United
States of America.

     The undersigned may at any time prepay all or any portion of the principal
or interest owing hereunder.

     This Note is secured in part by a pledge of the Company's Common Stock
under the terms of a Security Agreement of even date herewith and is subject to
all the provisions thereof.

     The holder of this Note shall have full recourse against the undersigned,
and shall not be required to proceed against the collateral securing this Note
in the event of default.

     In the event the undersigned shall cease to be an employee or consultant of
the Company for any reason, this Note shall, at the option of the Company, be
accelerated, and the whole unpaid balance on this Note of principal and accrued
interest shall be immediately due and payable.

     Should any action be instituted for the collection of this Note, the
reasonable costs and attorneys' fees therein of the holder shall be paid by the
undersigned.

                                             /s/ David S. Utley, M.D.
                                             -----------------------------------
                                             David S. Utley, M.D.
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                                   EXHIBIT B
                                   ---------

                     ASSIGNMENT SEPARATE FROM CERTIFICATE

     FOR VALUE RECEIVED I, David S. Utley, M.D. ("Pledgor"), hereby sell, assign
and transfer unto Curon Medical, Inc. ("Pledgee") _______________ (__________)
shares of the Common Stock of Curon Medical, Inc. standing in my name of the
books of said corporation represented by Certificate No. _____ herewith and do
hereby irrevocably constitute and appoint __________________________________ to
transfer the said stock on the books of the within named corporation with full
power of substitution in the premises.

     This Stock Assignment may be used only in accordance with the Security
Agreement between Curon Medical, Inc. and the undersigned dated January 4, 2001.

Dated: _______________, ____

                                        Signature: /s/ David S. Utley
                                                  ------------------------------

INSTRUCTIONS: Please do not fill in any blanks other than the signature line.
The purpose of this assignment is to enable the Pledgee to exercise its rights
to the Collateral as set forth in the Security Agreement, without requiring
additional signatures on the part of the Pledgor.

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