Stereotaxis
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S-1/A
STEREOTAXIS, INC. filed this Form S-1/A on 05/12/2004
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                                    APPENDIX
                      COMPENSATION FOR CONSULTING SERVICES

         Payments and Benefits. In return for the Consulting Services,
         Stereotaxis will provide to Young the payments and benefits described
         below.

         (A)      Cash Payments; Loan Repayment. Young will be paid the sum of
                  $18,200 per month in semi-monthly increments commencing
                  December 1, 2003. After January 1, 2004, Stereotaxis may
                  accelerate that monthly payment. Young agrees to repay the
                  outstanding principal and interest of the Promissory Note
                  dated November 20, 2001 made by Young in favor of the Company
                  by exchanging a number of shares of the Company's common stock
                  owned by Young on a date (the "Exchange Date") which is the
                  earlier of (i) the date of the pricing of an initial public
                  offering of the Company's common stock pursuant to a
                  registration statement filed the Company on Form S-1 with the
                  SEC (with settlement and exchange of the shares in such case
                  to occur one day following such closing) or (ii) August 31,
                  2004 or, if later, the Finish Date. The number of shares that
                  will be exchanged will be equal to (a) the outstanding
                  principal and interest on the Promissory Note as of the
                  Exchange Date, divided by (b) the per share value of the
                  common stock, which per share value shall be equal to (x) in
                  the event of an initial public offering, the per share
                  offering price to the public (before underwriting discounts
                  and commissions) or (y) otherwise, the then current value per
                  common share as determined by the Compensation Committee of
                  the Company. Young agrees that interest will continue to
                  accrue in respect of the promissory note until the Exchange
                  Date. The number and value of the shares shall take into
                  account any stock splits that may be effected in connection
                  with the initial public offering.

         (B)      Early Exercise Shares; Stock Options.

                           (i) Early Exercise Shares. The parties acknowledge
                  that a certain number of the 400,000 shares of the Company's
                  Common Stock you purchased pursuant to that certain Early
                  Exercise Agreement dated as of November 20, 2001 will be
                  subject to the Purchase Option (as defined in the Early
                  Exercise Agreement) as of December 1, 2003. Stereotaxis agrees
                  that it will exercise its Purchase Option for 50,000 of such
                  shares at $0.30 per share for an aggregate consideration of
                  $15,000. The parties agree that the Company shall continue to
                  hold the shares which it currently holds and which are not so
                  repurchased by the Company in escrow to facilitate the share
                  exchange described in Section (A) of this Appendix.
                  Immediately following the determination of the number of
                  shares to be exchanged, the Company shall, upon receipt of a
                  stock power from you, issue a certificate to you and deliver
                  it at your direction for the balance of such shares.

                           (ii) Stock Options. As to the remaining incentive
                  stock options granted to you under the Stock Option Agreement
                  dated February 19, 2002 (25,000 shares) and the Stock Option
                  Agreement dated May 28, 2003 (150,000 shares), we understand
                  that you do not currently intend to exercise any options
                  vested under such agreements within 90 days of the Effective
                  Date. Accordingly, we will amend those Stock Option Agreements
                  to provide that they will continue to vest on their current
                  schedule through the Finish Date, which will cause such
                  options to be treated as non-qualified options. In the case of
                  the Stock Option Agreement dated February 19, 2002, this may
                  require the Company to amend its 1994 Stock Option Plan, and
                  the Company shall take all reasonable steps to accomplish such
                  amendment unless there are formidable impediments to achieving
                  such amendment.



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