Stereotaxis
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S-1/A
STEREOTAXIS, INC. filed this Form S-1/A on 06/17/2004
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under any policy shall, at Bank's option, be payable to Bank on account of the
Obligations. Notwithstanding the foregoing, so long as no Event of Default has
occurred and is continuing, Borrower shall have the option of applying the
proceeds of any casualty policy up to $25,000.00, in the aggregate, toward the
replacement or repair of destroyed or damaged property; provided that (i) any
such replaced or repaired property (a) shall be of equal or like value as the
replaced or repaired Collateral and (b) shall be deemed Collateral in which Bank
has been granted a first priority security interest and (ii) after the
occurrence and during the continuation of an Event of Default all proceeds
payable under such casualty policy shall, at the option of the Bank, be payable
to Bank on account of the Obligations. If Borrower fails to obtain insurance as
required under Section 6.5 or to pay any amount or furnish any required proof of
payment to third persons and the Bank, Bank may make all or part of such payment
or obtain such insurance policies required in Section 6.5, and take any action
under the policies Bank deems prudent.

      6.6 ACCOUNTS.

            (a) In order to permit the Bank to monitor the Borrower's financial
performance and condition, Borrower, and all Borrower's Subsidiaries, shall
maintain Borrower's, and such Subsidiaries, primary depository, operating, and
securities accounts with Bank and a majority of the Borrower's and such
Subsidiaries cash or securities in excess of that amount used for Borrower's or
such Subsidiaries operations shall be maintained or administered through the
Bank.

            (b) Borrower shall identify to Bank, in writing, any bank or
securities account opened by Borrower with any institution other than Bank. In
addition, for each such account that the Borrower or Guarantor at any time opens
or maintains, Borrower shall, at the Bank's request and option, pursuant to an
agreement in form and substance acceptable to the Bank, cause the depository
bank or securities intermediary to agree that such account is the collateral of
the Bank pursuant to the terms hereunder. The provisions of the previous
sentence shall not apply to deposit accounts exclusively used for payroll,
payroll taxes and other employee wage and benefit payments to or for the benefit
of the Borrower's employees.

      6.7 FINANCIAL COVENANTS.

      Borrower shall maintain at all times, to be tested as of the last day of
each month, unless otherwise noted:

            (A) ADJUSTED QUICK RATIO. A ratio of Quick Assets to Current
            Liabilities minus Deferred Revenue of at least 1.5 to 1.0.

            (B) REVENUE TRACKING. Prior to the occurrence of the Initial Public
            Offering, beginning June 30, 2004, Borrower shall maintain quarterly
            revenues within thirty (30.0%) of the operating budget approved by
            the Board of Directors of the Borrower, and accepted by the Bank,
            tested as of the last day of each quarter for the preceding six (6)
            month period.

            (C) TANGIBLE NET WORTH. After the occurrence of the Initial Public
            Offering, Borrower shall maintain, as of the last day of each
            calendar month, a minimum Tangible Net Worth of at least Fifty
            Million Dollars ($50,000,000.00).

      6.8 FURTHER ASSURANCES. Borrower shall execute any further instruments and
take further action as Bank reasonably requests to perfect or continue Bank's
security interest in the Collateral or to effect the purposes of this Agreement.

7     NEGATIVE COVENANTS


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