Stereotaxis
    Print Page  Close Window
S-1/A
STEREOTAXIS, INC. filed this Form S-1/A on 05/12/2004
Entire Document
 << Previous Page | Next Page >>
<PAGE>

                                                                   EXHIBIT 10.31

                       RETIREMENT AND CONSULTING AGREEMENT

                  THIS Retirement and Consulting Agreement ("Agreement") is made
and entered into by and between Nicola Young (hereinafter "Young" or "you" or
"your"), and Stereotaxis, Inc. ("Stereotaxis"," "Company" or "we" or "us"). For
and in consideration of the following promises, the parties agree to the
following:

                  WHEREAS, for medical reasons and following a leave of absence
YOUNG has submitted her resignation from STEREOTAXIS effective December 1, 2003
("Effective Date") and STEREOTAXIS has with regret accepted such resignation.

                  WHEREAS, the parties acknowledge that Young has made
substantial contributions to the success of Stereotaxis that the parties desire
that YOUNG will continue to contribute financial advisory and transaction
management services to STEREOTAXIS going forward at least until July 31, 2004 or
such later date as is mutually agreed ("Finish Date") on the terms set forth in
this Retirement and Consulting Agreement.

                  NOW THEREFORE, for and in consideration of the mutual
covenants and undertakings hereinafter set forth, and for other good and
valuable consideration, which each party hereby acknowledges, it is agreed as
follows:

1.       Young will provide Stereotaxis
 with ongoing financial advisory and
         transaction management services ("Consulting Services") during
         reasonable working hours and including advising as to and conducting
         work regarding:

         a.       Negotiation, documentation and due diligence relating to
                  strategic alliances and business combinations;

         b.       Budgeting;

         c.       Financial modeling and forecasting;

         d.       Due diligence relating to financing activities including an
                  initial public offering ("IPO") of the common stock of the
                  Company and including making presentations to underwriters and
                  others in this regard;

         e.       The drafting relating to an IPO;

         f.       Preparation of audiovisual and verbal presentations for an IPO
                  "roadshow"; and

         g.       Investor relations;

         and such other services as are mutually agreed. In this regard the
         parties agree to minimize Young's air travel subject to providing
         reasonably appropriate services to the Company.

2.       Young and Stereotaxis may agree upon a later Finish Date, including
         agreeing on month to month extensions, on the same terms as set forth
         in this agreement.

3.       Compensation For Consulting Services. Compensation to Young from
         Stereotaxis for the Consulting Services will comprise the cash, stock
         and other elements set forth in the Appendix hereto.

4.       Standard Release of Claims. Young agrees to execute upon request by
         Stereotaxis and effective as at December 1, 2003 the Company's standard
         form release of claims applicable in context of a senior executive's
         resignation provided that such release is on reasonable commercial
         terms.




<PAGE>

5.       Choice of Law. This Agreement shall be construed and governed by the
         laws of the State of Missouri.

6.       Modification, Entire Agreement, Severability. The parties acknowledge
         that this Agreement and the Standard Release of Claims constitutes the
         entire agreement between them superseding all prior written and oral
         agreements regarding your separation, and there are no other
         understandings or agreements, written or oral, among them on the
         subject of your separation. The parties hereto agree that this
         Agreement may not be modified, altered, or changed except by a written
         agreement signed by the parties hereto. If any provision of this
         Agreement is held to be invalid, the remaining provisions shall remain
         in full force and effect.

7.       Confidential Information. Young agrees to abide by the confidentiality
         agreement set forth in your employment agreement signed on January 15,
         2001. Young agrees to adhere to this commitment now and in the future.


                  IN WITNESS WHEREOF, the undersigned parties have executed this
Agreement, effective as of the Effective Date.

                                    /s/ Nicola Young
                                    ---------------------------------------
                                    Nicola Young


                                    STEREOTAXIS, INC.


                                    By:/s/ John Aplin
                                       ------------------------------------
                                       John Aplin, Director







                                       2

<PAGE>

                                    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.



                                       3

<PAGE>

         (C)      Performance Bonus. You will receive a performance bonus for
                  fiscal year 2003 in the amount of Forty-five thousand dollars
                  ($45,000.00). Such bonus will be paid by Stereotaxis at the
                  same time otherwise paid to eligible employees during calendar
                  2004.

         (D)      Indemnification. Stereotaxis will indemnify you and your
                  estate against any claims made against you in your capacity as
                  an officer of Stereotaxis for actions arising out of or in the
                  course of your employment while an officer of Stereotaxis and
                  for such actions arising out of or in the course of your
                  consulting services to the Company described above.

         (E)      Health Insurance Continuation. Stereotaxis shall continue your
                  current healthcare coverage under the Company's healthcare
                  policy for the same period set forth in paragraph 1(A) above,
                  the consulting period, or, if not available, then we will pay
                  your COBRA payments for said period, after which time such
                  benefits will cease unless you choose to continue healthcare
                  benefits pursuant to COBRA.

         (F)      Vacation Pay. On or by November 30, 2003 or the next following
                  payroll period, Stereotaxis will pay you all accrued, but
                  unused vacation compensation.

         (G)      Moving Expenses. Stereotaxis will reimburse you for your
                  reasonable moving expenses to Arizona from St. Louis provided
                  that such reimbursement will not exceed the amount of Ten
                  thousand dollars ($10,000).

         (H)      Vested Rights. The parties agree that this Agreement shall not
                  adversely affect, alter, or extinguish any vested rights you
                  may have with respect to any pension or 401k plan to which you
                  are or may be entitled by virtue of your employment with
                  Stereotaxis, and nothing in this Agreement will prohibit you
                  from enforcing your rights to any such pension or 401k plan.



                                       4



 << Previous Page | Next Page >>