Stereotaxis, Inc. (STXS) Business

ITEM 1. BUSINESS

In
this report, “Stereotaxis”, the “Company”, “Registrant”, “we”, “us”, and
“our” refer to Stereotaxis, Inc. and its wholly owned subsidiaries. GenesisX RMN®, Genesis RMN®,
Niobe®, Navigant®, Synchrony™, SynX™, Odyssey®, Odyssey Cinema™,
MAGiC™, MAGiC Sweep™, EMAGIN™, Map-iT™, QuikCAS™, Cardiodrive®, Vdrive®,
Vdrive Duo™, V-CAS™, V-Loop™, V-Sono™, and NuVizion™ are trademarks of
Stereotaxis, Inc. All other trademarks that appear in this report are the property of their respective owners.

FORWARD-LOOKING
STATEMENTS

This
annual report on Form 10-K, including the sections entitled “Business” and “Management’s Discussion and Analysis
of Financial Condition and Results of Operations,” contains forward-looking statements. These statements relate to, among other
things:

These
statements relate to future events or future financial performance, and involve known and unknown risks, uncertainties, and other factors
that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results,
levels of activity, performance or achievements expressed or implied by such forward-looking statements. In some cases, you can identify
forward-looking statements by terminology such as “may”, “will”, “should”, “could”, “expects”,
“plans”, “intends”, “anticipates”, “believes”, “estimates”, “predicts”,
“potential”, or “continue”, or the negative of such terms or other comparable terminology. Although we believe
that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity,
performance, or achievements. These statements are only predictions.

Factors
that may cause our actual results to differ materially from our forward-looking statements include, among others, changes in general
economic and business conditions and the risks and other factors set forth in “Item 1A—Risk Factors” and elsewhere
in this annual report on Form 10-K.

Our
actual results may be materially different from what we expect. We undertake no duty to update these forward-looking statements after
the date of this annual report, even though our situation may change in the future. All of our forward-looking statements are qualified
by these cautionary statements.

3

OVERVIEW

Stereotaxis
designs, manufactures and markets robotic systems, instruments and information systems for the interventional laboratory. Our proprietary
robotic technology, Robotic Magnetic Navigation, fundamentally transforms endovascular interventions using precise computer-controlled
magnetic fields to directly control the tip of flexible interventional catheters or devices. Direct control of the tip of an interventional
device, in contrast to all manual hand-held devices that are controlled from their handle, can improve the precision, stability, reach
and safety of these devices during procedures.

Our
primary clinical focus has been electrophysiology, specifically cardiac ablation procedures for the treatment of arrhythmias. Cardiac
ablation has become a well-accepted therapy for arrhythmias and a multi-billion-dollar medical device market with expectations for substantial
long-term growth. We have shared our aspirations and a product strategy to expand the clinical focus of our technology to several additional
endovascular indications including coronary, neuro, and peripheral interventions.

There
is substantial real-world evidence and clinical literature for Robotic Magnetic Navigation in electrophysiology. Hundreds of electrophysiologists
at over one hundred hospitals globally have treated over 150,000 arrhythmia patients with our robotic technology. Clinical use of our
technology has been documented in over 500 clinical publications. Robotic Magnetic Navigation is designed to enable physicians to complete
more complex interventional procedures with greater success and safety by providing image-guided delivery of catheters through the blood
vessels and chambers of the heart to treatment sites. This is achieved using externally applied computer-controlled magnetic fields that
govern the motion of the working tip of the catheter, resulting in improved navigation. The more flexible atraumatic design of catheters
driven using magnetic fields may reduce the risk of patient harm and other adverse events. Performing the procedure from a control cockpit
enables physicians to complete procedures in a safe location protected from x-ray exposure, with greater ergonomics, and improved efficiency.
We believe these benefits can be applicable in other endovascular indications where navigation through complex vasculature is often challenging
or unsuccessful and generates significant x-ray exposure, and we are investing in research and development in these areas.

Our
primary products include the Genesis RMN and the GenesisX RMN Systems, the Odyssey and Synchrony & SynX Solutions,
various interventional devices under the Map-iT, MAGiC and EMAGIN brands, and other related devices. Through our
strategic relationships with fluoroscopy system manufacturers, providers of catheters and electrophysiology mapping systems, and other
parties, we offer our customers x-ray systems and other accessory diagnostic and therapeutic devices.

The Genesis
RMN and the GenesisX RMN Systems are designed to enable physicians to complete complex interventional procedures by
providing image-guided delivery of catheters through the blood vessels and chambers of the heart to treatment sites. This is
achieved using externally applied magnetic fields that govern the motion of the working tip of the catheter, resulting in improved
navigation, efficient procedures, and reduced x-ray exposure. The GenesisX RMN System, the latest generation of the Genesis
RMN System, is designed to enhance the accessibility of Robotic Magnetic Navigation by reducing the lengthy construction cycle
necessary to install prior generation RMN systems.

The
Odyssey Solution consolidates lab information onto one large integrated display, enabling physicians to view and control all the
key information in the operating room. This is designed to improve lab layout and procedure efficiency. The system also features a remote
viewing and recording capability called Odyssey Cinema. The Odyssey Solution and Odyssey Cinema are being replaced
by next generation innovative solutions branded Synchrony and SynX. Synchrony digitizes and modernizes the interventional
cath lab with a 4K high-definition display that consolidates the viewing and control of disparate systems in the lab, offering enhanced
procedure experience with custom layouts, streamlined workflows, an intuitive user interface, and a decluttered environment. Synchrony
is made available with SynX a cloud-based HIPAA and GDPR-compliant browser and mobile-based app that allows for secure remote
connectivity, collaboration, recording, and monitoring of the cath lab. As these technologies gain regulatory approvals they are being
commercialized alongside RMN systems and as stand-alone solutions.

We
pursue arrangements with fluoroscopy system manufacturers to provide RMN Systems in a bundled purchase offer for hospitals establishing
robotic interventional operating rooms. An integrated x-ray system is critical for customer adoption of RMN Systems, and when
offered as a bundled purchase with the RMN System, it may reduce the cost of acquisition, the ongoing cost of ownership, and the
complexity of installation of a robotic electrophysiology practice.

We
promote our full suite of products necessary for a typical hospital implementation, subject to regulatory approvals or clearances. This
implementation requires a hospital to agree to an upfront capital payment and recurring payments. The upfront capital payment typically
includes equipment and installation charges. The recurring payments typically include disposable costs for each procedure, equipment
service costs beyond the warranty period, and ongoing software updates. In hospitals where our full suite of products has not been implemented,
equipment upgrade or expansion can be implemented upon purchasing of the necessary upgrade or expansion.

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As
of December 31, 2025, we had approximately $9.1 million of system backlog, consisting of outstanding purchase orders and other commitments
for these systems. Of the December 31, 2026 backlog, we expect approximately 78% to be recognized as revenue over the course of 2026.
We had system backlog of approximately $14.4 million as of December 31, 2024. There can be no assurance that we will recognize such revenue
in any period or at all because some of our purchase orders and other commitments are subject to contingencies that are outside our control.
These orders and commitments may be revised, modified or canceled, either by their express terms, because of negotiations or by project
changes or delays. In addition, the sales cycle for the robotic magnetic navigation system is lengthy and generally involves construction
or renovation activities at customer sites. Consequently, revenues and/or orders resulting from sales of our robotic magnetic navigation
system can vary significantly from one reporting period to the next.

We
have strategic relationships with technology leaders and innovators in the global interventional market. Through these strategic relationships
we provide compatibility with our robotic magnetic navigation system, integrated x-ray systems, digital imaging and 3D catheter location
sensing technology, and compatible disposable interventional devices. The maintenance of these strategic relationships, or the establishment
of equivalent alternatives, is critical to our commercialization efforts. There are no guarantees that any existing strategic relationships
will continue, and efforts are ongoing to ensure the availability of compatible systems and devices and/or equivalent alternatives. We
cannot provide assurance as to the timeline of the ongoing availability of such compatible systems or our ability to obtain equivalent
alternatives on competitive terms or at all.

On
July 31, 2024, the Company completed its acquisition of all the shares of capital stock of Access Point Technologies EP, Inc., a Minnesota
corporation (“APT”), from APT Holding Company, Inc., a Minnesota corporation. APT, based in Rogers, Minnesota, designs, manufactures,
and commercializes a portfolio of differentiated high-quality diagnostic catheters, branded as Map-iT catheters, used during cardiac
ablation procedures that are commercially available across key global geographies.

The
integration with APT provides in-house catheter development, manufacturing expertise and specialized knowledge that will further Stereotaxis’
innovation efforts in developing a broad family of interventional devices navigated by our robots within electrophysiology and across
a range of endovascular procedures.

We
were incorporated in Delaware in June of 1990 as Stereotaxis, Inc. Our principal executive offices are located at 710 North Tucker Boulevard,
Suite 110, St. Louis, Missouri 63101, and our telephone number is (314) 678-6100.

We operate our business as one
segment, as defined by U.S. generally accepted accounting principles. Our financial results for the years ended December 31, 2025
and 2024 are discussed in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations”.

THE
STEREOTAXIS VALUE PROPOSITION

Although
great strides have been made in manual interventional devices and techniques, significant challenges remain that reduce interventional
productivity and limit both the number of complex procedures and the types of diseases that can be treated manually. These challenges
primarily involve the inherent mechanical limitations of manual instrument control and the lack of integration of the information systems
used by physicians in the interventional lab as well as a significant amount of training and experience required to ensure proficiency.
As a result, many complex cases in electrophysiology are treated with palliative drug therapy, and many procedures are still performed
as invasive surgeries rather than as minimally invasive endovascular interventions.

Our
systems address the current challenges in the interventional lab by providing precise computerized control of the working tip of the
interventional instrument and by integrating this control with the visualization technology and information systems used during electrophysiology
and endovascular interventional procedures, on a cost-justified basis.

We
believe that our technology can:

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PRODUCTS

Robotic
Magnetic Navigation

Our
proprietary robotic magnetic navigation systems (“RMN”) include the GenesisX RMN, Genesis RMN and the prior generation
Niobe Systems. These systems are designed to enable physicians to complete more complex interventional procedures by providing
image-guided delivery of catheters and guidewires through the blood vessels and chambers of the heart to treatment sites. This is achieved
using externally applied magnetic fields that govern the motion of the working tip of the catheter or guidewire, resulting in improved
navigation, efficient procedures and reduced x-ray exposure. Our systems provide physicians with precise remote digital instrument control
in combination with sophisticated image integration. It can be operated either from an adjacent room and outside the x-ray fluoroscopy
field or beside the patient table, as in traditional interventional procedures. Our RMN system allows the operator to navigate disposable
interventional devices to the treatment site through complex paths in the blood vessels and chambers of the heart to deliver treatment
by using computer controlled, externally applied magnetic fields to directly govern the motion of the working tip of these devices, each
of which has a magnetically sensitive tip that predictably responds to magnetic fields generated by our system. Because the working tip
of the disposable interventional device is directly controlled by these external magnetic fields, the physician has the same degree of
control regardless of the number or type of turns, or the distance traveled by the working tip to arrive at its position in the blood
vessels or chambers of the heart. This results in highly precise digital control of the working tip of the disposable interventional
device while still giving the physician the option to manually advance the device.

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Through
our arrangements with manufacturers and providers of fluoroscopy systems, catheters, and electrophysiology mapping systems, we provide
compatibility between the robotic magnetic navigation system and the visualization and information systems used during electrophysiology
and endovascular procedures to provide the physician with a comprehensive information and instrument control system. In addition, we
have integrated the robotic magnetic navigation system with 3D catheter location sensing technology to provide accurate real-time information
as to the 3D location of the working tip of the instrument. The maintenance of these technology compatibility, integrations, and strategic
relationships is critical to our commercialization efforts. There are no guarantees that any existing strategic relationships will continue,
and efforts are ongoing to ensure the availability of compatible systems and devices and/or equivalent alternatives.

Our
robotic magnetic navigation systems utilize two permanent magnets mounted on articulating and pivoting arms with one magnet on either
side of the patient table. These magnets generate magnetic navigation fields that steer and deflect the magnetic interventional devices
in the patient anatomy. These magnetic fields are significantly less than the strength of fields typically generated by MRI equipment.
The robotic magnetic navigation system is indicated for use in cardiac, peripheral and neurovascular applications. The robotic magnetic
navigation system is used in conjunction with the Cardiodrive Automated Catheter Advancement System (“Cardiodrive”)
and the QuikCAS automated catheter advancement single-use disposable device, which together are used to remotely advance and retract
a catheter while the robotic magnetic navigation system magnets steer the working tip of the device.

Odyssey®
Solution

The
Odyssey Solution, and the next generation, Synchrony and SynX Solution, offer a fully integrated, real-time information
solution to manage, control, record and share procedures across networks or around the world. We believe that these tools enhance the
physician workflow in interventional labs through a consolidated user interface of multiple systems on a single display to enable greater
focus on the case and improve the efficiency of the lab. Using a single mouse and keyboard, the Odyssey Solution allows the user
to command multiple systems in the lab from a single point of control. In addition, the Odyssey Solution acquires a real-time,
remote view of the lab, capturing synchronized procedure data for review of important events during cases. The Odyssey Solution
enables physicians to access recorded cases and creates snapshots following procedures for enhanced clinical reporting, auditing and
presentation. The Odyssey Solution enables physicians to establish a comprehensive master archive of procedures performed in the
lab providing an excellent tool for training new staff on standard practices. The Odyssey Solution further enables procedures
to be observed remotely around the world with high-speed Internet access over a hospital VPN, even wirelessly using a standard laptop
or Windows tablet computer. The next generation solution, branded as Synchrony and SynX, modernizes the interventional
cath lab with a 4K high-definition display that consolidates the viewing and control of disparate systems in the lab, offering enhanced
procedure experience with custom layouts, streamlined workflows, an intuitive user interface, and a decluttered environment. Synchrony™
is made available with SynX™, a cloud-based HIPAA and GDPR-compliant browser and mobile-based app that allows for secure remote
connectivity, collaboration, recording, and monitoring of the cath lab.

X-ray
systems

We
pursue arrangements with fluoroscopy system manufacturers to provide such systems in a bundled purchase offer for hospitals establishing
robotic interventional operating rooms. An integrated x-ray system is critical for customer adoption of RMN systems, and when offered
as a bundled purchase offer with the RMN System, may reduce the cost of acquisition, the ongoing cost of ownership, and the complexity
of installation of a robotic electrophysiology practice.

Disposables
and Other Accessories

Our
robotic magnetic navigation systems are designed to use a toolkit of associated disposable interventional devices. We market and distribute
disposable and related devices that can be used with our robotic magnetic navigation systems and in traditional, manual procedures.

Within
the robotic device toolkit, we manufacture and distribute the MAGiC catheter, the MAGiC Sweep mapping catheter, the QuikCAS,
the iCONNECT, and the V-CAS devices.

Prior
to regulatory clearance of a replacement device, our propriety MAGiC ablation catheter, in Europe in 2025 and regulatory approval
in the U.S. in early 2026, the robotically enabled ablation catheters predominantly used with our RMN Systems were co-developed with
Biosense Webster, a wholly owned subsidiary of Johnson and Johnson (the “J&J catheters”). The J&J catheters were
solely manufactured and distributed by them and their obligation to supply those catheters ended on December 31, 2025. We do not know
their plans for the continuation of the J&J catheters, and we have no guarantees that supply of those catheters will continue into
2026. Although we are ramping up production of the MAGiC ablation catheter as a replacement device, continued supply of the J&J
catheters into 2026 remains of significant importance for many customers of our technology.

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On
July 31, 2024, the Company completed its acquisition of Access Point Technologies EP, Inc, based in Rogers, Minnesota providing us with
the Map-iT portfolio of devices. These devices include differentiated high-quality diagnostic catheters used in traditional cardiac
ablation procedures and are commercially available across key global geographies. The acquisition also provides us with the basis to
develop additional magnetically enabled devices which can be used with our RMN systems.

Revenue
from sales of disposable products is recognized when control is transferred to the customers, which generally occurs at the time of shipment,
but can also occur at the time of delivery depending on the customer arrangement. Disposable products are covered by an assurance-type
warranty that provides for the return of defective products. Warranty costs were not material for the periods presented.

The
maintenance of strategic relationships with compatible devices, or the establishment of equivalent alternatives, is critical to our commercialization
efforts. There are no guarantees that any existing strategic relationships will continue, and efforts are ongoing to ensure the availability
of compatible devices and/or equivalent alternatives. We cannot provide any assurance as to the timeline of the ongoing availability
of such compatible systems or our ability to obtain equivalent alternatives on competitive terms or at all.

Other
Recurring Revenue

Other
recurring revenue includes revenue from product maintenance plans, service-type warranties, and other post warranty maintenance. Revenue
from services and software enhancements, including service-type warranties, are deferred and amortized over the service or update period,
which is typically one year. Revenue related to services performed on a time-and-materials basis is recognized when performed.

Regulatory
Approval

We
have received regulatory clearance, and/or approvals necessary for us to market the Genesis System with Cardiodrive, iCONNECT, Navigant,
Odyssey and QuikCAS in the U.S., Europe, and China, and we are in the process of pursuing registrations for extending our markets
in other countries.

We
have received regulatory clearance, and/or approvals necessary for us to market the GenesisX RMN System, the latest generation
of the Genesis RMN System in the U.S. and Europe, and we are in the process of obtaining necessary approvals in other countries.

We
have regulatory clearances and approvals that allow us to market the SynX collaboration solution in the U.S. and Europe.

We
have obtained the CE marking for us to market the Synchrony system in Europe and are in the process of obtaining necessary approvals
in the US and other countries.

We
have received regulatory clearance, and/or approvals necessary for us to market the Niobe System with Cardiodrive, e-Contact, Navigant,
Odyssey, QuikCAS in the U.S., Europe, Canada, China, Japan, and various other countries.

We
have received regulatory clearance, licensing and/or approvals necessary for us to market the Vdrive and Vdrive Duo Systems with
the V-CAS in the U.S., Europe, and Canada.

We
have received regulatory clearance, licensing and/or approvals necessary for us to market the Stereotaxis MAGiC catheter, a robotically
navigated magnetic ablation catheter designed to perform minimally invasive cardiac ablation procedures in the U.S. and Europe, and we
are in the process of obtaining necessary approvals in other countries.

We
have received regulatory clearance and/or approvals necessary for us to market the Map-it diagnostic mapping catheters in the U.S. and
Europe.

The
MAGiC Sweep™ catheter, the first robotically navigated high-density EP mapping catheter, received FDA 510(k) clearance in
July 2025. We are in the process of obtaining necessary approvals in other geographies.

We
are also currently seeking regulatory clearances for the EMAGIN 5F catheter guide designed to robotically navigate tortuous venous
and arterial vasculature.

FINANCIAL
INFORMATION ABOUT CUSTOMERS

No
single customer accounted for more than 10% of total revenue for the years ended December 31, 2025 and 2024. No single country, other
than the U.S., accounted for more than 10% of total revenue for the years ended December 31, 2025, and 2024.

8

CLINICAL
APPLICATIONS

We
have focused our clinical and commercial efforts on applications of our products primarily in electrophysiology procedures for the treatment
of arrhythmias and secondarily in complex interventional cardiology procedures for the treatment of coronary artery disease. Our system
potentially has broad applicability in other areas, such as structural heart repair, interventional neurosurgery, interventional neuroradiology,
peripheral vascular, renal denervation, pulmonology, urology, gynecology and gastrointestinal medicine, and some of our patents may be
applicable in these areas as well.

Electrophysiology

The
rhythmic beating of the heart results from the transmission of electrical impulses. When these electrical impulses are mistimed or uncoordinated,
the heart fails to function properly, resulting in symptoms that can range from fatigue to stroke or death. Over 5.0 million people in
the U.S. currently suffer from abnormal heart rhythms, which are known as arrhythmias. The prevalence of arrhythmias is expected to continue
to rise as the population ages, life expectancy increases, and lifestyle factors such as obesity become more prevalent. Arrhythmias are
a major physical and economic burden and are associated with stroke, heart failure, and adverse symptoms causing patients to be motivated
to seek treatment. The combination of symptoms, prevalence and comorbidities make arrhythmias a major economic factor in healthcare.

Drug
therapies for arrhythmias often have limited efficacy, poor compliance, and side effects. Consequently, physicians have increasingly
sought more permanent, non-pharmacological, solutions for arrhythmias. The most common interventional treatment for arrhythmias is an
ablation procedure in which the diseased tissue giving rise to the arrhythmia is isolated or destroyed. Prior to performing an electrophysiology
ablation, a physician typically performs a diagnostic procedure in which the electrical signal patterns of the heart wall are “mapped”
to identify the heart tissue generating the aberrant electrical signals. Following the mapping, the physician may then use an ablation
catheter to eliminate the aberrant signal or signal path, restoring the heart to its normal rhythm. These procedures may be performed
separately but are more commonly performed at the same time.

We
believe more than 7,000 interventional labs around the world are currently conducting nearly one and a half million cardiac ablation
procedures annually. The market has grown rapidly over the last decade with annualized procedure growth of approximately 10%.

We
believe that Robotic Magnetic Navigation is particularly well-suited for these electrophysiology procedures which are time consuming,
or which can only be performed by highly experienced physicians. These procedures include:

We
believe that our RMN can address the current challenges in electrophysiology by permitting the physician to remotely navigate disposable
interventional devices from a control room outside the x-ray field. Additionally, we believe that our RMN allows for more predictable
and efficient navigation of these devices to the treatment site and enables catheter contact to be consistently maintained to efficiently
apply energy on the wall of the beating heart. We also believe that our RMN will significantly lower the skill barriers required for
physicians to perform complex electrophysiology procedures and, additionally, improve interventional lab efficiency and reduce disposable
interventional device utilization.

9

Interventional
Cardiology

More
than half a million people die annually from coronary artery disease, a condition in which the formation of plaque in the coronary arteries
obstructs the supply of blood to the heart, making this the leading cause of death in the U.S. Despite various attempts to reduce risk
factors, each year over one million patients undergo interventional procedures in an attempt to open blocked vessels and another one
half million patients undergo open heart surgery to bypass blocked coronary arteries.

Blockages
within a coronary artery, often called lesions, are categorized by degree of obstruction as partial occlusions, non-chronic total occlusions
and chronic total occlusions. Lesions are also categorized by the degree of difficulty with which they can be opened as simple or complex.
Complex lesions, such as chronic total occlusions, longer lesions, and lesions located within smaller diameter vessels, are often very
difficult or time consuming to open with manual interventional techniques.

We
believe approximately 11,000 interventional labs worldwide are currently capable of conducting interventional cardiology. Over 4 million
interventional cardiology procedures are performed annually in the U.S. alone. We estimate that approximately 10-15% of these interventional
cardiology procedures currently being performed are complex and therefore require longer procedure times and may have sub-optimal outcomes.
We believe that our system can substantially benefit this subset of complex interventional cardiology procedures.

Interventional
Neuroradiology, Neurosurgery and Other Interventional Applications

Physicians
used a predecessor to our Niobe System to conduct a number of procedures for the treatment of brain aneurysms, a condition in
which a portion of a blood vessel wall balloons and which can result in debilitating or fatal bleeding and strokes. We believe the robotic
magnetic navigation system also has a range of potential applications in minimally invasive neurosurgery, including biopsies and the
treatment of tumors, treatment of vascular malformations and fetal interventions.

STRATEGIC
RELATIONSHIPS

We
have arrangements with technology leaders in the global interventional market, including manufacturers of fluoroscopy systems, ablation
catheters, and electrophysiology mapping systems, that we believe are critical for us in commercializing our robotic magnetic navigation
systems. These arrangements are important to us as they provide for the integration of our system with digital imaging and 3D catheter
location sensing technology, as well as catheters compatible with our system.

With
partners, we jointly developed electrophysiology mapping and ablation catheters that are navigable with our robotic magnetic navigation
system. We believe that these products provide physicians with the elements required for effective complex electrophysiology procedures:
accurate information as to the location of the catheter in the body and precise control over the working tip of the catheter.

Prior
to regulatory clearance of a replacement device, our propriety MAGiC ablation catheter, in Europe in 2025 and regulatory approval
in the U.S. in early 2026, the robotically enabled ablation catheters predominantly used with our RMN Systems were co-developed
with Biosense Webster, a wholly owned subsidiary of Johnson and Johnson (the “J&J catheters”). The J&J catheters
were solely manufactured and distributed by them and their obligation to supply those catheters ended on December 31, 2025. We do not
know their plans for the continuation of the J&J catheters, and we have no guarantees that supply of those catheters will continue
into 2026. Although we are ramping up production of the MAGiC ablation catheter as a replacement device, continued supply of the
J&J catheters into 2026 remains of significant importance for some customers of our technology.

The
maintenance of strategic relationships with technology leaders in the global interventional market, or the establishment of equivalent
alternatives, is critical to our commercialization efforts. There are no guarantees that any existing strategic relationships will continue,
and efforts are ongoing to ensure the availability of compatible systems and devices and/or equivalent alternatives. We cannot provide
any assurance as to the timeline of the ongoing availability of such compatible systems or our ability to obtain equivalent alternatives
on competitive terms or at all.

RESEARCH
AND DEVELOPMENT

We
have assembled an experienced group of engineers and physicists with recognized expertise in magnetics, software, control algorithms,
mechanics, electronics, systems integration and disposable interventional device design.

Our
research and development efforts are focused in the following areas:

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Our
research and development team collaborates with strategic third parties to integrate our robotic magnetic navigation system’s open
architecture platform with key imaging, location sensing and information systems in the interventional lab. We have also collaborated
with highly regarded interventional physicians in key clinical areas and have entered into agreements with universities and teaching
hospitals, which serve to increase our access to world class physicians and to expand our name recognition in the medical community.

CUSTOMER
SERVICE AND SUPPORT

We
provide worldwide maintenance and support services to our customers’ products directly or with the assistance of outsourced product
and service representatives. By utilizing these relationships, we provide direct, on-site technical support activities, including call
center, customer support engineers and service parts logistics and delivery. In certain situations, we use these third parties as a single
point of contact for the customer, allowing us to focus on providing installation, training and back-up technical support.

Our
back-up technical support includes a combination of on-line, telephone and on-site technical assistance services 24 hours a day, seven
days a week. We employ service and support engineers with networking and medical equipment expertise and outsource a portion of our installation
and support services. We offer different levels of support to our customers, including basic hardware and software maintenance, extended
product maintenance, and rapid response capability for both parts and service.

We
have established a call center in our St. Louis facilities, which provides real-time clinical and technical support to our customers
worldwide.

MANUFACTURING

Robotic
Magnetic Navigation Systems and Odyssey and Synchrony & SynX Solutions

Our
manufacturing strategy for our Robotic Magnetic Navigation Systems and Odyssey and Synchrony & SynX Solutions
is to sub-contract many of the manufacture of major subassemblies of our systems to maximize manufacturing flexibility and lower fixed
costs. We maintain quality control for all our systems by completing final system assembly and inspection in-house.

We
purchase both custom and off-the-shelf components from many suppliers and subject them to quality specifications and processes. Some
of the components necessary for the assembly of our products are currently provided to us by sole-sourced suppliers (the only recognized
supply source available to us) or single-sourced suppliers (the only approved supply source for us among other sources). We purchase
most of our components and major assemblies through purchase orders rather than long-term supply agreements and generally do not maintain
large volumes of finished goods.

Disposable
Interventional Devices

Our
historical manufacturing strategy for disposable interventional devices was to outsource their manufacture through subcontracting and
to expand partnerships for other interventional devices. We work closely with our contract manufacturers and have strong relationships
with component suppliers. We have entered into manufacturing agreements to provide high volume capability for devices other than catheters.
With the July of 2024 acquisition of APT, we have the ability to manufacture disposable interventional devices at our Rogers, Minnesota
location as a complement to our primarily outsourced model.

Software

The
software components of the robotic magnetic navigation system and the Odyssey and Synchrony & SynX Solutions , including
control and application software, are developed both internally and with integrated modules we purchase or license. We perform final
testing of software products in-house prior to their commercial release.

General

Our
manufacturing facility operates under processes that meet the FDA’s requirements under the Quality System Regulation (QSR). Our
ISO registrar and European notified British Standard Institution (BSI) has audited our facility annually since 2001 and found the facility
to comply with relevant requirements. The most recent ISO 13485 and MDSAP Certificate of Registration were issued in 2025 and are valid
through September 2028.

SALES
AND MARKETING

We
market our products in the U.S and internationally through a direct sales force of senior sales specialists, distributors and sales agents,
supported by account managers and clinical specialists who provide training, clinical support, and other services to our customers.

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Our
sales and marketing efforts include two important elements: (1) selling robotic magnetic systems, the Odyssey and Synchrony
& SynX Solutions, and magnetically compatible x-ray systems directly and through distributors; and (2) leveraging our
installed base of systems to drive recurring sales of disposable interventional devices, software and service.

REIMBURSEMENT

We
believe that substantially all of the procedures, whether commercial or in clinical trials, conducted in the U.S. with the robotic magnetic
navigation systems have been reimbursed to date. We expect that third-party payors will reimburse, under existing billing codes, procedures
in which compatible ablation catheters are used. We expect healthcare facilities in the U.S. to bill various third-party payors, such
as Medicare, Medicaid, other government programs and private insurers, for services performed with our products. We believe that procedures
performed using our products or targeted for use by products that do not yet have regulatory clearance or approval, are generally already
reimbursable under government programs and most private plans. Accordingly, we believe providers in the U.S. will generally not be required
to obtain new billing authorizations or codes to be compensated for performing medically necessary procedures using our products on insured
patients. We cannot guarantee that reimbursement policies of third-party payors will not change in the future with respect to some or
all of the procedures using the robotic magnetic navigation system.

In
countries outside the United States, reimbursement is obtained from various sources, including governmental authorities, private health
insurance plans, and labor unions. In most foreign countries, private insurance systems may also offer payments for some therapies. Additionally,
health maintenance organizations are emerging in certain European countries. In Europe, we believe that substantially all of the procedures,
whether in commercial settings or clinical trials, conducted with the robotic magnetic navigation systems have been reimbursed to date.
In other foreign countries, we may need to seek international reimbursement approvals, and we do not know if these required approvals
will be obtained in a timely manner or at all.

See
“Item 1A—Risk Factors” for a discussion of various risks associated with reimbursement from third-party payors.

INTELLECTUAL
PROPERTY

The
proprietary nature of, and protection for, our products, processes and know-how are important to our business. We seek patent protection
in the United States and internationally for our systems and other technology where available and when appropriate.

We
have an extensive patent portfolio that we believe protects the fundamental scope of our technology and systems, including our robotic
magnetic technology, navigational methods, mapping system and procedural workflows, 3D integration technology, and disposable interventional
devices. As of December 31, 2025, we had 43 issued U.S. patents and 3 pending U.S. patent application. In addition, we had 6 issued foreign
patents and 5 pending foreign patent applications. The key patents that protect our technology and systems extend until 2028 and beyond.

We
also have a number of invention disclosures under consideration and several applications that are being prepared for filing. We cannot
be certain that any patents will be issued from any of our pending patent applications, nor can we be certain that any of our existing
patents or any patents that may be granted in the future will provide us with protection.

We
believe it would be difficult and costly to reverse engineer our robotic magnetic navigation system, which contains numerous complex
algorithms that control our disposable devices inside the magnetic fields generated by the robotic magnetic navigation system. We further
believe that our patent portfolio is broad enough in scope to enable us to obtain legal relief if any entity not licensed by us attempted
to market disposable devices in the U.S. that can be navigated by the robotic magnetic navigation system. We can also utilize security
keys, such as embedded smart chips or associated software that could allow our system to recognize specific disposable interventional
devices to prevent unauthorized use of our system.

We
have also developed substantial expertise in magnet design, magnet physics, and magnetic instrument control in connection with the development
of the robotic magnetic navigation system, which we maintain as trade secrets. This expertise centers around our proprietary magnet design,
which is a critical aspect of our ability to design, manufacture and install a cost-effective magnetic navigation system that is small
enough to be installed in a standard interventional lab. Our Odyssey Solution contains numerous complex algorithms and proprietary
software and hardware configurations, and requires substantial knowledge to design and assemble, which we maintain as trade secrets.
This proprietary software and hardware, some of which is owned by Stereotaxis, and some of which is licensed to Stereotaxis, is a material
aspect of the ability to design, manufacture and install cost-effective and efficient information integration, storage, and delivery
platform.

In
addition, we seek to protect our proprietary information by entering confidentiality, assignment of inventions or license agreements
with our employees, consultants, contractors, advisers and other third parties. However, we believe that these measures afford only limited
protection.

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COMPETITION

The
markets for medical devices are intensely competitive and are characterized by rapid technological advances, frequent new product introductions,
evolving industry standards, and price erosion.

In
electrophysiology we consider the primary competition to our robotic magnetic navigation system to be traditional catheter-based electrophysiology
ablation approaches including RF (radiofrequency) ablation and non-RF therapies. To our knowledge, we are the only company that has commercialized
remote, digital, and direct control of the working tip of catheters for use in RF ablation procedures. Our success depends in part on
convincing hospitals and physicians to convert traditional interventional procedures to procedures using our robotic magnetic navigation
system.

We
face competition from companies that are developing and marketing new products for use in electrophysiology. These products include next
generation mapping systems and RF ablation devices with which our robotic magnetic navigation system is not currently compatible, as
well as non-RF ablation devices including single-shot cryoablation devices and other new products, such as pulse field ablation, for
use in other interventional therapies. Some of these products are marketed by companies that may have an established presence in the
field of electrophysiology, including major imaging, capital equipment and disposables companies that are currently selling products
in the interventional lab. In addition, we face competition from companies that currently market or are developing drugs, gene, or cellular
therapies to treat the conditions for which our products are intended.

We
also face competition from companies that are developing robotic technologies for electrophysiology and non-electrophysiology interventional
procedures. We are aware of four companies that commercialized endovascular catheter navigation systems which have been cleared by the
FDA for electrophysiology procedures as well as two companies with electromagnetic catheter navigation systems that received CE Mark
approval in Europe. None of these companies seem to be active in catheter robotics with any current commercial activities. Outside of
electrophysiology, there are at least two companies that have commercialized robotic systems for guidewire manipulation and can be viewed
as potential competitors as we look to address additional clinical applications.

Our
Map-iT family of devices competes directly with other companies that manufacture and sell traditional interventional devices.
We also recently developed our own line of robotically enabled medical devices and are aware of two other companies that also produce
and sell magnetically enabled catheters.

We
face direct competition in certain products in our Odyssey/Synchrony Solution. These competitors include established imaging companies
as well as dedicated solution providers. We expect to continue to face competitive pressure in this market in the future, based on the
rapid pace of advancements with this technology.

We
believe that the primary competitive factors in the market we address are capability, safety, efficacy, ease of use, price, quality,
reliability and effective sales, support, training and service. The length of time required for products to be developed and to receive
regulatory and reimbursement approval is also an important competitive factor. See “Item 1A—Risk Factors” for a discussion
of other competitive risks facing our business.

GOVERNMENT
REGULATION

Our
products are medical devices that are subject to extensive regulation in the U.S. and in foreign countries where we do business. The
FDA regulates the development, testing, manufacturing, labeling, storage, recordkeeping, promotion, marketing, distribution and service
of medical devices in the U.S. to ensure that medical products distributed domestically are safe and effective for their intended uses.
In addition, the FDA regulates the export of medical devices manufactured in the U.S. to international markets and the importation of
medical devices manufactured abroad.

In
many foreign countries in which we market our products, we are subject to regulations affecting, among other things, product standards,
packaging requirements, labeling requirements, import restrictions, tariff regulations, duties and tax requirements. Many of these regulations
are similar to those of the FDA or other U.S. regulations. In addition, our products must meet the requirements of a large and growing
body of international standards which govern the design, manufacture, materials content and sourcing, testing, certification, packaging,
installation, use and disposal of our products. Failure to meet these standards could limit the ability to market our products in those
regions which require compliance to such standards. Examples of groups of such standards are electrical safety standards such as those
of the International Electrotechnical Commission and composition standards such as the Reduction of Hazardous Substances (“RoHS”)
and Waste Electrical and Electronic Equipment (“WEEE”) Directives.

U.S.
Food and Drug Administration

Unless
an exemption applies, each medical device we wish to commercially market in the United States will require 510(k) clearance, de novo
approval, or pre-market approval (PMA) from the FDA. The FDA classifies medical devices into one of three classes. Devices deemed to
pose lower risks are placed in either Class I or II, which requires the manufacturer to submit to the FDA a pre-market notification requesting
permission to commercially distribute the device, known as 510(k) clearance. Some low-risk devices are exempted from this requirement.
Devices deemed by the FDA to pose the greatest risks, such as life-sustaining, or life-supporting, or devices deemed not substantially
equivalent to a previously cleared 510(k) device, are placed in Class III, requiring pre-market approval, or PMA. Most of our current
products are Class II devices requiring 510(k) clearances. The J&J compatible catheters used with our magnetic navigation system,
as well as the MAGiC catheter, are Class III therapeutic devices and are subject to the PMA process.

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If
U.S. clinical data are needed to support clearance, approval or a marketing application for our devices, generally, an investigational
device exemption, or IDE, is assembled and submitted to the FDA. The FDA reviews and must approve the IDE before the study can begin.
In addition, the study must be approved by an Institutional Review Board covering each clinical site involved in the study. When all
approvals are obtained, we initiate a clinical study to evaluate the device. Following completion of the study, we collect, analyze and
present the data in an appropriate submission to the FDA (i.e., in support of a 510(k), de novo, or PMA).

When
a 510(k) clearance is required, we must submit a pre-market notification demonstrating that our proposed device is substantially equivalent
to a previously cleared and legally marketed 510(k) device, de novo approved device, or a device that was in commercial distribution
before May 28, 1976, for which the FDA has not yet called for the submission of pre-market approval applications. To establish substantial
equivalence, the applicant must show that the new device has the same intended use as the predicate device, and it either has the same
technological characteristics or has been shown to be equally safe and effective and does not raise different questions of safety and
effectiveness as compared to the predicate device. The FDA may require further information, including clinical trial results or product
test data, to make a determination regarding substantial equivalence. The FDA’s 510(k) clearance process usually takes from (4)
four to (12) twelve months but can take longer.

If
a device is not eligible for the 510(k) clearance process, but the product is low or moderate risk, we may be able to obtain de novo
review. The de novo process allows FDA to classify a low- to moderate-risk device not previously classified into Class I or II. If the
device is not eligible for either the 510(k) or de novo processes, a PMA must be submitted to the FDA. A PMA must be supported by extensive
data, including but not limited to technical, preclinical, clinical trials, manufacturing and labeling to demonstrate reasonable evidence
of the device’s safety and efficacy to the FDA’s satisfaction. The PMA process is much more costly, lengthy and uncertain
than the 510(k) clearance process, and it generally takes from one to three years, but can take longer. We cannot be sure that the FDA
will ever grant 510(k) clearance, de novo approval or pre-market approval for any product we propose to market in the United States.

After
a device receives 510(k) clearance or de novo approval, any modification that could significantly affect its safety or effectiveness,
or that would constitute a significant change in its intended use, will require a new clearance. Modification to a PMA approved device
or its labeling may require either a new PMA or PMA supplement approval, which could be a costly and lengthy process.

After
a device is placed on the market, numerous regulatory requirements apply. These include, for example:

The
FDA has broad post-market and regulatory enforcement powers. We are subject to unannounced inspections by the FDA to determine our compliance
with the QSR and other regulations. If we fail to comply with the QSR or other regulatory requirements, we may receive a warning or untitled
letter from the FDA or be subject to other enforcement actions, including fines, injunctions, civil penalties, seizures, operating restrictions,
partial suspension or total shutdown of production, refusing requests for 510(k) clearance, de novo petitions, or PMA approval of new
products, withdrawing 510(k) clearance, de novo approvals, or PMA approvals already granted, and criminal prosecution. The FDA also has
the authority to require us to repair, replace or refund the cost of any medical device that we have manufactured or distributed if there
is a reasonable probability that the device would cause serious, adverse health consequences or death.

International
Regulation

For
us to market our products in other countries, we must obtain regulatory approvals and comply with extensive safety and quality regulations
in other countries. These regulations, including the requirements for approvals or clearance and the time required for regulatory review,
vary from country to country and can involve additional product testing and additional administrative review periods. The time required
to obtain approval in other countries may differ from that required to obtain FDA clearance or approval.

14

The
primary regulatory environment in Europe is that of the European Union (EU), which encompasses most of the major countries in Europe.
The EU, along with other member countries of the European Economic Area, or EEA, requires that manufacturers of medical products obtain
the right to affix the CE Mark to their products before selling them in member countries of the EEA. The CE Mark is an international
symbol of adherence to quality assurance standards and compliance with applicable directives. To obtain the right to affix the CE Mark
to products, a manufacturer must obtain certification that its processes meet certain quality standards. Compliance with the Medical
Device Regulation (MDR), as certified by a recognized European Notified Body, permits the medical device manufacturer to affix the CE
Mark on its products and commercially distribute those products throughout the EEA. We are subject to annual surveillance audits and
periodic re-certification audits to maintain our CE Mark permissions. The MDR establishes a uniform, transparent, predictable, and sustainable
regulatory framework across the EU for medical devices and ensures a high level of safety and health while supporting innovation. Regulations
are directly applicable in EU member states without the need for member states to implement into national law. This aims at increasing
harmonization across the EU. The MDR became effective on May 26, 2021.

We
are subject to additional regulations in other foreign countries, including, but not limited to Canada, Taiwan, China, Japan, Korea,
and Russia, to sell our products. We intend that either we or our distributors will receive any necessary approvals or clearance prior
to marketing our products in these international markets.

Please
refer to “Regulatory Approval” in Item 1 of this annual report for a description of the regulatory clearance, licensing and/or
approvals we currently have or are pursuing.

Anti-Kickback
and False Claims Laws

We
are subject to various federal and state laws relating to healthcare fraud and abuse, including anti-kickback and false claims laws.
The U.S. federal healthcare program Anti-Kickback Statute prohibits persons from knowingly and willfully soliciting, offering, receiving
or providing remuneration, directly or indirectly, in exchange for or to induce either the referral of an individual, or furnishing or
arranging for a good or service, for which payment may be made under a federal healthcare program such as the Medicare and Medicaid programs.
The definition of “remuneration” has been broadly interpreted to include anything of value, including for example, gifts,
discounts, the furnishing of supplies or equipment, credit arrangements, payments of cash and waivers of payments, and providing anything
of value at less than fair market value. Penalties for violations include criminal penalties and civil sanctions such as fines, imprisonment
and possible exclusion from Medicare, Medicaid and other federal healthcare programs. Federal false claims laws prohibit any person from
knowingly presenting, or causing to be presented, a false claim for payment to the federal government, or knowingly making, or causing
to be made, a false statement to have a false claim paid. In the past several years, several healthcare companies have been prosecuted
under these laws for allegedly providing free product to customers with the expectation that the customers would bill federal programs
for the product. In addition, certain marketing practices, including off-label promotion, may also violate false claims laws.

Many
states have adopted laws similar to the federal healthcare program Anti-Kickback Statute and the federal false claims laws. Some of these
state prohibitions apply to healthcare items or services reimbursed by any source, not only the Medicare and Medicaid programs.

Transparency
Laws

Under
the Physician Payments Sunshine Act, or the Sunshine Act, which was enacted by Congress as part of the Patient Protection and Affordable
Care Act, we are required to track and report to the federal government on an annual basis, subject to certain exceptions, all payments
and other transfers of value to U.S. physicians and teaching hospitals, as well as ownership interests held by physicians. Such data
is made available by the government on a publicly searchable website. In addition, we are subject to similar state laws related to the
tracking and reporting of certain payments and other transfers of value to healthcare professionals.

HIPAA
and Other Privacy Laws

We
are subject to laws and regulations protecting the privacy and integrity of patient medical information, including the Health Insurance
Portability and Accountability Act of 1996, or HIPAA, which imposes certain requirements relating to the privacy, security and transmission
of individually identifiable health information, and the applicable Privacy and Security Standards of HITECH, the Health Information
Technology for Economic and Clinical Health Act. HIPAA also prohibits executing a scheme to defraud any healthcare benefit program or
making false statements relating to healthcare matters.

In
addition to federal regulations issued under HIPAA, some states and foreign countries have enacted privacy and security statutes or regulations
that, in some cases, are more stringent than those issued under HIPAA. For example, the General Data Protection Regulation (the “GDPR”),
which is in effect across the European Economic Area (the “EEA”), imposes several stringent requirements for controllers
and processors of personal data and increased our obligations, for example, by imposing higher standards when obtaining consent from
individuals to process their personal data, requiring more robust disclosures to individuals, strengthening individual data rights, shortening
timelines for data breach notifications, limiting retention periods and secondary use of information, increasing requirements pertaining
to health data as well as pseudonymised data, and imposing additional obligations when we contract third-party processors in connection
with the processing of personal data. The GDPR provides that EU member states may make their own further laws and regulations limiting
the processing of genetic, biometric, or health data. Failure to comply with the requirements of the GDPR and the applicable national
data protection laws of the EU member states may result in fines of up to €20 million or 4% of the total worldwide annual turnover
of the preceding financial year, whichever is greater, and other administrative penalties.

15

In
addition, effective January 1, 2020, California passed the California Consumer Privacy Act (the “CCPA”), which is considered
by many to be the most far-reaching data privacy law introduced in the U.S. to date and which introduces new compliance burdens on many
organizations doing business in California who collect Personal Information about California residents. The CCPA’s definition of
Personal Information is very broad and specifically includes biometric information. The CCPA took effect in 2020 and will allow for significant
fines by the state attorney general, as well as a private right of action from individuals in relation to certain security breaches.
Further, the California Consumer Privacy Rights Act (“CPRA”), which took effect on January 1, 2023, revised and expanded
the CCPA, adding new data protection obligations to covered business and rights for consumers. Similar data protection laws have also
been enacted by other states, including Virginia, Colorado, Connecticut, and Utah.

As
a result of any amendment or change to the foregoing, it may be necessary to modify our operations and procedures to comply with the
more stringent state and foreign laws, which may entail significant and costly changes for us.

Certificate
of Need Laws

Several
states in the U.S., require a certificate of need or similar regulatory approval prior to a hospital’s acquisition of high-cost
capital items or various types of advanced medical equipment, such as our robotic magnetic navigation system. Many of the states in which
we sell robotic magnetic navigation systems have laws that require institutions located in those states to obtain a certificate of need
in connection with the purchase of our system, and some of our purchase orders are conditioned upon our customer’s receipt of necessary
certificate of need approval.

Anti-Corruption
Laws

Our
operations outside the U.S. require us to comply with a number of U.S. and international regulations, including the Foreign Corrupt Practices
Act (“FCPA”). The FCPA prohibits U.S. corporations from offering, promising, authorizing, or making payments to foreign government
officials for the purpose of obtaining or retaining business. In many countries, the scope of the FCPA could include interactions with
certain healthcare professionals. Other countries have enacted similar anti-corruption laws.

Human
Capital

Given
the highly competitive nature of the medical device industry, the future success of our company depends on our ability to attract, retain,
and further develop top talent. We value the skills of our employees and the contributions they make in helping us achieve our mission
to discover, develop and deliver robotic systems, instruments, and information solutions for the interventional laboratory. We are committed
to attracting, developing, and retaining the best talent.

Our
global leadership represents a broad range of backgrounds and brings a wide array of perspectives and experiences that have helped us
achieve our leadership in innovative robotic technologies designed to enhance the treatment of arrhythmias and to perform endovascular
procedures.

As
of December 31, 2025, our employees were based in 11 different countries around the world, including the U.S. Our global workforce consists
of highly skilled talent and experience at all levels. We strongly believe that all employees should have a work environment free from
discrimination, harassment, bias and prejudice. We strive to foster a culture where mutual respect and dignity are core to our individual
expectations.

As
of December 31, 2025, we had 131 employees, 40 of whom were engaged directly in research and development, 47 in sales and marketing activities,
26 in manufacturing and service, and 18 in general administrative activities including finance, information systems, legal and general
management. A significant majority of our employees are not covered by a collective bargaining agreement, and we consider our relationship
with our employees to be positive. We also engage the services of independent contractors and consultants as needed for special or temporary
projects or specific expertise.

Health,
Safety, and Wellness

The
health, safety, and wellness of our employees is a priority in which we continue to invest. We provide our employees and their families
with access to health and wellness programs that support employee wellbeing, time away from work, family care, mental health, and financial
well-being. We also conduct on-site engagement activities that facilitate cross-team networking, collaboration, and innovation.

16

We
continue to evolve our programs to respond to the best interest of our workforce, as well as the communities in which we operate, in
compliance with government regulations. We manage overall safety with guidance based on regional, country, and local regulations and
best practices.

Compensation
and Benefits

We
strive to provide our employees with what we believe is a competitive and comprehensive total rewards package of compensation, benefits
and services. In addition to base compensation, these packages, which vary by country and region, can include annual bonuses, sales commissions,
401(k) and/or pension plans, healthcare and insurance benefits for employees and family members, health savings and flexible spending
accounts, paid time off, family leave, and flexible work schedules. In addition, we offer employees the benefit of equity ownership in
the company through stock option grants and/or restricted stock units. Eligible employees can participate in an employee stock purchase
plan, which offers the opportunity to purchase our common stock at a discount of 5%.

Training
and Development

We
recognize the importance of furthering education and development of our employees through the various stages of their careers. We are
dedicated to promoting individual, leader, team, and organizational development through a number of tools and services. We offer a variety
of professional development courses for our employees and support employee continuing education. In addition, our employees are required
to complete compliance training applicable to our industry. We also have an annual global performance review process for reviewing all
employees’ performance and pay.

Availability
of Information

We
make certain filings with the SEC, including our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form
8-K, and all amendments and exhibits to those reports, available free of charge in the Investors section of our website, http://www.stereotaxis.com,
as soon as reasonably practicable after they are filed with the SEC. Further, these filings are available on the Internet at http://www.sec.gov.
Information contained on our website is not part of this report and such information is not incorporated by reference into this report.

Executive
Officers

See
Part III – Item 10 for information about our Executive Officers.