Good day, ladies and gentlemen and thank you for standing by. Welcome to the Stereotaxis Second Quarter Earnings Conference Call. During today’s presentation, all participants will be in a listen-only mode. Following the presentation, the conference will be opened for questions. (Operator Instructions) This conference is being recorded today, Thursday, August 8, 2013. And I would now like to turn the conference over to Todd Kehrli with the MKR Group. Please go ahead.

Thank you, operator, and good morning everyone. Thank you for joining us this morning for Stereotaxis’ conference call and webcast to review financial results for its 2013 second quarter ended June 30, 2013. Before we get started, we would like to remind you that during the course of this conference call, the company might make projections and other forward-looking statements regarding future events or the future financial performance of the company. These include, without limitation, statements regarding future operating results, growth opportunities, and other statements that reflects Stereotaxis’ plans, prospects, expectations, strategies, intentions, and beliefs. These statements are subject to many risks and uncertainties that could cause the actual results to differ materially from expectations. For a detailed discussion of the risks and uncertainties that affect the company’s business and that qualify the forward-looking statements made on this call, we refer you to the company’s periodic and other public filings filed with the SEC, including the Form 10-K for the fiscal year ended December 31, 2012, the quarterly Form 10-Q filings and the Form 8-K filed today. The company’s projections and forward-looking statements are based on factors that are subject to change and therefore these statements speak only as of the date they are given. The company assumes no obligation to update any projections or forward-looking statements. In addition, regarding orders and backlog, there can be no assurance that the company will recognize revenue related to its purchase orders and other commitments in any particular period or at all, because of some of these purchase orders and other commitments are subject to contingencies that are outside the company’s control. In addition, these orders and commitments maybe revised, modified, or canceled either by their expressed terms, as a result of negotiations or by project changes or delays. With that said, I’d now like to turn the call over to William Mills, Chairman and Interim CEO of Stereotaxis. Go ahead.

Good morning, everyone and thank you for joining us for a review of Stereotaxis’ second quarter 2013 performance. Joining me today is our CFO, Marty Stammer. Following our prepared comments, we will open up the call to your questions. During the second quarter, we achieved sequential revenue growth in total revenue of 16% driven by a nearly 50% increase in system revenue from the first quarter through a more fully staffed account team focusing on the execution of clinical adoption plan that we outlined in our last call, the improved utilization rates in strategic regions. We also held operating expenses to targeted levels and significantly reduced our operating loss to $1.8 million, representing a 51% sequential improvement. In July, we achieved an important milestone with FDA clearance of our Vdrive Robotic Navigation System with V-Sono ICE Catheter Manipulator, a potentially significant boost to our U.S. market opportunities. At the same time, we continued to pursue options to improve our cash position. Today, we are pleased to announce that we have entered into transactions with each of our existing convertible debt holders, which involve the exchange of notes into shares of common stock and the exercise of warrants to purchase additional shares. The result for Stereotaxis is a cash infusion of approximately $8.5 million. Marty will cover the details of the transactions later. While this gives immediate relief to our cash position, we continue to search for a more long-term solution to our liquidity challenges, which have been previously disclosed. To that end, we have engaged Gordian Group a financial advisor with extensive expertise and experience in assisting companies with complex liquidity issues to strengthen the balance sheet and maximize stakeholder value. Along with continuing to improve operational results, this remains our top priority. Now, let’s review a few details of…

Thanks, Bill and good morning everyone. First, let me discuss the transactions with convertible noteholders that we announced today. Yesterday, holders of all of our convertible subordinated notes exercised outstanding warrants to purchase an aggregate of 2.5 million shares of common stock for cash at an exercise price of approximately $3.36 per share and converted a portion of their notes into shares of common stock. In a separate transaction, the holders exchanged the balance of their convertible notes for shares and additional warrants to purchase the same number of shares also at approximately $3.36 per share. The convertible notes held by these holders were extinguished, and we issued shares at a combined rate of $3 per share in these transactions. As a result of these transactions, we are issuing a total of 5.2 million shares of common stock and will receive an aggregate of $8.5 million in cash from the warrant exercise. In addition, $8.1 million of convertible subordinated notes have been retired. In connection with the exchange, we amended the terms of the original securities purchase agreement under which the notes and warrants were issued to remove certain ongoing covenants. We also intend to conduct a rights offering to all existing stockholders, in which our stockholders may elect to purchase a specified fraction of a share for each share of stock held as of the record date for the offering at a price of $3 per share. No record date has been set for the rights offering at this time. We entered into these transactions with the assistance of Gordian Group in order to help alleviate our immediate liquidity concerns. On June 30, we had cash and cash equivalents of $4.1 million compared to $9.6 million at March 31. Our outstanding debt was $29.9 million, including $18.5 million related…

Thanks Marty. As we move into the second half of the year, we have reason to be hopeful that the positive trends we are seeing in capital sales and clinical adoption will continue to improve our top line results. With the clearance of our first Vdrive product in the U.S., we are excited to begin marketing its unique clinical value at what we believe will be a very receptive audience. Above all we are committed to strengthening our balance sheet for the benefit of each of our stakeholders especially the thousands of patients each year who depend on Stereotaxis technology to realize a better quality of life. Now, we will open up the call to your questions. Operator?

Thank you, sir. (Operator Instructions) And our first question comes from the line of Steven Lichtman with Oppenheimer & Company. Please go ahead. Rosemary Liu - Oppenheimer & Company: Hi, guys. This is Rosemary in for Steve. Can you hear me okay?

We can. Good morning, Rosemary. Rosemary Liu - Oppenheimer & Company: Good morning. Congrats on the Vdrive approval in the U.S., first of all. Can you just walk us through how you will be rolling out Vdrive at U.S. accounts over the next few quarters and how this approval will affect your conversation with potential new accounts. Basically, any color you can give to help frame how much of a catalyst this is for the U.S. business that would be really helpful.

Yeah. So it’s a great question. It’s an important topic, Rosemary, and we are excited about it. And I think the steps that we’ll be taking will involve, first off, the generation of broad market interest, which has begun. We are notifying customers regarding the clearance through various media and communications means we are launching a V-Sono webinar and exploring certain nationwide promotional opportunities that all of these initiatives are occurring within the next 90 days or 90 to 120 days. Beginning this month, we are – and this is very important building reference sites in which we are selecting three early adoption sites, where we can intensify early training and support and partner on the product and value feedback considerations and monitor early success. And once those reference sites have been tuned to our collective satisfaction, we will start broad-selling in Niobe labs in early September, early next month. So, these will all then lead to the ongoing adoption of the product, but it’s an important launch for us, it’s one that we want to get right. And so we will be taking these sort of deliberate steps in the short-term to make sure that we have everything in place. So, as you know, we have some experience in clinical utilization of the device in Europe and we have learned a lot from that and refined the product already as a result of some of those experiences, but we will be building on that in the U.S. here. And as I mentioned earlier on, I think we believe the U.S. is a more attractive market for a variety of reasons for this family of products and specifically for V-Sono. So, we will be excited to begin the rollout over the coming weeks. Rosemary Liu - Oppenheimer & Company: Yes, definitely. Thanks so much for that color. Also how far away is the opportunity to expand Vdrive beyond those Niobe labs that you mentioned and what do you need to get there?

Well, that too is a very good question. I mean, we have two thrusts I think with moving Vdrive forward. First, will be we will be adding the FDA willing, of course, and these are subject to review by FDA and to their granting us the opportunity to do it, but we will be looking for additional catheter manipulation capabilities to add the Vdrive within the Niobe environment. But your question really is in the longer term, will Vdrive constitute a standalone or Vdrive with Odyssey perhaps constitute a standalone opportunity in labs, where the workflow would be favorably impacted by that? And I guess, I would tell you we very much believe that, that is the case. We have regulatory work to do before we get there, but we very much believe strategically that, that is an opportunity to expand beyond the core Niobe labs footprint that we currently are focused on and that can only enlarge the market I think rather substantially, but we don’t want to get ahead of ourselves there yet. We have additional work to do before we are prepared to access that market. Rosemary Liu - Oppenheimer & Company: Okay, that makes sense. Also on the new capital orders on 2Q, definitely a much stronger uptake there are you seeing any changes in terms of the hospital CapEx landscape?

People generally react to a question like that based on their most recent experience. And so I think emotionally, our inclination is to point toward some gathering strength and some improvement. The performance on a quarter-to-quarter basis is always the result of a number of cross-cutting and detached influences I think on performance. So, I would tell you that I think that we feel as though we are gathering strength in those markets. We are addressing the issues internally that might have held us from achieving further improved results in the past. And at the same time, we feel particularly here in the U.S. markets as though we are looking at a market that, that will support our continued improvement going forward. But generally speaking when a customer commits to the concept of Niobe and makes the determination and allocates the resources to go in that direction, we find that that is a – that that is something that they can generally complete. I think that the capital cycle is largely with us in that connection, so. Rosemary Liu - Oppenheimer & Company: That’s helpful, Bill. Also regarding your sales force comments from earlier in the call...

Yeah. Rosemary Liu - Oppenheimer & Company: Can you maybe expand some more on these new initiatives and how they are influencing productivity, and maybe, some more color on utilization dynamics today and where you think they can go with these initiatives?

Well, as we mentioned earlier, our principal effort here is focused on increasing efficiencies and coverage in the field by putting the right skill mixes in the field at the right place and having those skill mixes matched more appropriately to the tasks that need to be accomplished. And with the introduction of our territory assistance into the equation here, we’ve – we believe achieved a much more efficient model of coverage. I think, I had mentioned on the last call that – the question was asked, it may have been Steve actually that asked the question, how long does it take to have an impact in the field when you repopulate and retune the field force that is responsible for animating the utilization activity. And I think my answer was, well, it’s not an instant response, there is a period of induction where those people spin up and engage. But I would say that we are very much encouraged that that process is a finite one. We are seeing the results on an individual basis as that – as those individuals are settled into their territories and engaged fully with their customers. So, we are pleased with the adjustment to our model, we will continue to emphasize these sorts of refinements to it. And the results so far are encouraging to us. And I think we’ll continue to see that manifest itself. Marty, are there any other dynamics that you think, we ought to point out to Rosemary in that regard, anything I have overlooked at the – at the high level.

No, I think that pretty well covers it.

Okay, I hope that? Rosemary Liu - Oppenheimer & Company: Okay. Thank you. Also, just quickly switching gears a bit on to Niobe ES upgrades, do you think we are nearing the end of the life cycle here in terms of upgrades, or was there anything particular in the quarter, or how should we be thinking about that going forward?

Well, there is a life cycle; there is a finite pool obviously of earlier generation systems that ultimately would be upgraded. So, I think we’ve worked through the majority of those upgrade opportunities, but not all of them, I think it’s fair to say, I can’t give you a specific quantification, ultimately we don’t know whether – what traction of existing installations of Niobe II will choose to not upgrade in the future, but it’s a decision that they could make at any time during the life of the system. So, we have to look at it as a closed ended opportunity, because it certainly is. There is a finite number, it’s a dwindling number. We have been upgrading as I said, the majority of these systems, and there will be customers left at the end that for whatever combination of reasons ultimately make the determination not to upgrade. But the growth in the ES platform base then will come primarily or ultimately exclusively from new system sales. So, you are right, it is a closed ended pool. We will ultimately get to the end of that pool, we are not there yet, but we have done a lot of the work in that direction. Rosemary Liu - Oppenheimer & Company: Okay, got it. And finally, for me on China, that first procedure performed is very exciting. Can you remind us of the opportunity here, and basically, what are the next steps with this market?

Well, China as we have said for sometime on a demographic and a dynamic basis is a, it’s an enormous potential opportunity for us. And I am convinced that we would be well-served by being able to bring additional resources to bear perhaps through a partnership in our support of that territory opportunity, which is very large and is especially large in juxtaposition to the resources that we can currently put against that. So, as you know, we have installations in China. We are beginning to scratch the surface in that market, but we are going to need to focus on opportunities to bring additional resources to bear there to even begin to exploit that opportunity. I think that both China and Japan are substantial opportunities for us going forward. The Japanese market, although we are a little later to enter is probably a more straightforward market for us to participate in. And it’s a little bit more structured in some respects. It may accommodate our entry in a more linear fashion, but China at the end of the day, will probably turn out to be an even larger market still. So, the opportunities are large compared to our resources to exploit them, but we are very much in the process of trying to bring a better balance to that opportunity, because they are significant for us. Rosemary Liu - Oppenheimer & Company: Okay, thanks so much guys for taking the questions.

Thank you, Rosemary.

Thank you. I am showing no further questions in the queue at this time. I’d like to turn the call back over to management for closing remarks.

Well, thank you everyone. I see the market has opened a couple of minutes ago. So, I think people probably want to get to their day, but we very much appreciate your attention and your support and we will look forward to speaking with you in the near future. Everyone have a good day.

Thanks you. Ladies and gentlemen, this does conclude our conference for today. If you would like to listen to a replay of today’s call, please dial 303-590-3030 or 1-800-406-7325 with access code 4635474. Thank you for your participation. You may now disconnect.