UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 10-KSB/A

Amendment No. 1 to Form 10-KSB

For the fiscal year ended June 30, 2000

Commission File Number 0-24635

Hypertension Diagnostics, Inc.
(Name of Small Business Issuer in Its Charter)

2915 Waters Road, Suite 108, Eagan, Minnesota 55121

(Address of Principal Executive Offices, including Zip Code)

Issuer’s Telephone Number: (651) 687-9999

Securities registered pursuant to Section 12(b) of the Exchange Act: None

Securities registered pursuant to Section 12(g) of the Exchange Act:

Common Stock ($.01 par value)

(Title of Class)

Redeemable Class A Warrant

(Title of Class)

Units, consisting of one share of Common Stock and one Redeemable Class A Warrant

(Title of Class)

      Check whether the issuer: (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]

      Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B contained in this form, and no disclosure will be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB. [ ]

      The issuer’s revenues for its most recent fiscal year were $423,490.

      The aggregate market value of the voting stock held by nonaffiliates of the issuer as of September 15, 2000 was approximately $35,561,000, based upon the closing sale price for the Common Stock on that date as reported by The Nasdaq SmallCap Market.

      There were 5,255,240 shares of the issuer’s Common Stock, $.01 par value per share outstanding as of September 15, 2000.

DOCUMENTS INCORPORATED BY REFERENCE

None.

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This Item 10 is hereby amended to correct typographical errors and to read as follows:

ITEM 10. Executive Compensation

      The following table sets forth the aggregate compensation for the years indicated for our executive officers who received salary and bonus payments in excess of $100,000.

Summary Compensation Table

      The following table provides information about each stock option grant made during the fiscal year ended June 30, 2000 to the named executive officers.

Option Grants In Fiscal Year 2000

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      The following table summarizes stock option exercises during the fiscal year ended June 30, 2000 and the total number of options held at the end of fiscal year 2000 by the named executive officers.

Aggregated Option Exercises in Fiscal Year 2000 and
Fiscal Year End Option Values

Employment Agreements

      On October 30, 1995, we entered into a five-year employment agreement with Charles F. Chesney to serve as our President and Chief Executive Officer until we appointed another President and Chief Executive Officer, at which time Dr. Chesney became the Executive Vice President and Chief Technology Officer (which occurred on January 1, 1996). Pursuant to the employment agreement, Dr. Chesney was paid a minimum annual salary (exclusive of benefits, bonuses or incentive payments) of $128,000, subject to annual adjustments to reflect increases in the cost of living. Dr. Chesney’s base annual salary, plus benefits, bonuses and incentive payments, must be equal to, or greater than, 80% of that paid to our President and/or Chief Executive Officer. Dr. Chesney also was granted a stock option to purchase 288,046 shares at an exercise price of $1.70 per share. In addition, on August 18, 1997, we granted Dr. Chesney a stock option under the 1995 Option Plan to purchase 75,000 shares at an exercise price of $2.00 per share. The employment agreement was terminable by Dr. Chesney for any reason, upon sixty (60) days written notice. Dr. Chesney may be terminated by us only for “reasonable cause,” as defined. The employment agreement contained certain confidentiality obligations. On February 19, 1999, we granted Dr. Chesney an option to purchase 5,000 shares of stock at $2.81 per share. On February 18, 2000, we granted Dr. Chesney an option to purchase 25,428 shares of stock at an exercise price of $4.35 per share. In connection with the hiring of Mr. Sellke as Chief Executive Officer, and pursuant to an amendment to Dr. Chesney’s Employment Agreement dated effective April 16, 1999, Dr. Chesney’s minimum annual salary was increased to $128,000, and Dr. Chesney waived the right to any adjustment to other types of compensation which may have otherwise resulted from such other type of compensation paid to Mr. Sellke.

      On December 22, 1999, we entered into employment agreements with Dennis L. Sellke, Charles F. Chesney, Greg H. Guettler and James S. Murphy, each with a two (2) year term. Under those agreements, Dennis L. Sellke was to serve as our Chief Executive Officer and receive a base salary of $160,000. Charles F. Chesney serves as our Executive Vice President, Chief Technology Officer and Secretary and receives a base salary of $141,500. Greg H. Guettler serves as our President and receives a base salary of $141,500. James S. Murphy serves as our Senior Vice President, Finance and Administration and Chief Financial Officer and receives a base salary of $128,000. The agreements provide for increases to the base salary based upon performance, as well as bonus and incentive payments and the opportunity to receive stock options for the purchase of our Common Stock. Further, each of the agreements has non-compete and confidentiality provisions which prohibit the employee from disclosing our confidential information and from competing with us or soliciting our employees for a period of one year following the termination of the employment relationship. If the agreement is terminated without cause before the two-year term is expired, we are obligated to continue making base salary payments until the expiration of the agreement or for a period of one (1) year, whichever is less. Upon a change of control which leads to termination of employment for reasons other than “for cause” or “good reason,” we are obligated to pay a severance payment based upon the base salary.

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      On April 16, 1999, we granted Mr. Sellke a nonqualified Stock Option pursuant to our 1998 Option Plan to purchase 100,000 shares of stock at an exercise price of $2.94 per share; on September 8, 1997, we granted Mr. Guettler an option to purchase 150,000 shares of stock at an exercise price of $2.00 per share, on February 19, 1999, an option to purchase 5,000 shares of stock at an exercise price of $2.81 per share and, on February 18, 2000, an option to purchase 25,428 shares of stock at an exercise price of $4.35 per share; and on July 1, 1997, we granted Mr. Murphy an option to purchase 53,100 shares of stock, vesting monthly over the initial four-year period, at an exercise price of $2.00 per share, on February 19, 1999, an option to purchase 5,000 shares of stock at an exercise price of $2.81 per share and, on February 18, 2000, an option to purchase 23,124 shares of stock at an exercise price of $4.35 per share.

Outside Director Compensation

      Members of the Board of Directors receive no cash compensation for such service. However, we have granted to each of our outside directors an option to purchase 25,000 shares at an exercise price of $2.00 per share. On February 19, 1999, we granted each of the outside directors an option to purchase 5,000 shares at an exercise price of $2.81 per share. On February 18, 2000, we granted each of the outside directors an option to purchase 3,000 shares at an exercise price of $4.35 per share. On February 18, 2000, we granted Melville R. Bois an option to purchase 1,000 shares at an exercise price of $4.35 per share for his services as Chairman of our Board of Directors for calendar year 1999. Furthermore, we have established for future outside board members an option-based compensation policy for the compensation of such members of our Board of Directors providing that each newly appointed or elected outside director will be granted a ten-year option, vesting over four years, for 20,000 shares of our Common Stock, exercisable at the fair market value of such stock on the date of grant of the option. In addition, each such outside director will be granted an additional option for 3,000 shares of our Common Stock at the end of each year of service, vested as of the date of grant, for a ten-year term exercisable at the fair market value of our Common Stock on the date of grant.

      On October 30, 1995, we entered into a four-year consulting agreement with Jay N. Cohn, M.D., a member of our Board of Directors. Dr. Cohn is also one of our founders and serves as our Chief Clinical Consultant and Chairman of our Scientific and Clinical Advisory Board. The agreement is cancellable for any reason by either us or Dr. Cohn upon 60 days prior notice. Under the terms of the agreement, we agreed to grant Dr. Cohn nonqualified stock options to purchase 449,265 shares, which are exercisable for a period of ten years at an exercise price of $1.70 per share, to serve as clinical liaison and spokesman for our arterial compliance technology and to use his best efforts to forward the research, clinical penetration and marketing of our Products. All of the shares underlying these options have been fully vested.

      On August 28, 1998 our Board of Directors agreed to amend Dr. Cohn’s consulting agreement. Under the amended consulting agreement, Dr. Cohn will perform marketing, sales and public relations activities. As consideration for such additional services, we have agreed to grant to Dr. Cohn an option to purchase 100,000 shares of Common Stock under our 1998 Stock Option Plan, with an exercise price equal to $3.656 per share (which was the fair market value of the Common Stock on the date of grant). The option vests in three equal annual installments commencing on the date of grant. The consulting agreement has been extended through August 2001.

      On January 1, 1996, we entered into a consulting agreement with Melville R. Bois, to serve as our President and Chief Executive Officer on a part-time basis until such time as we appointed another President and/or Chief Executive Officer. Under the terms of the agreement, we agreed to pay Mr. Bois a monthly consulting fee of $4,000 and grant Mr. Bois nonqualified stock options to purchase 12,500 shares, which are exercisable for a period of ten years at an exercise price of $2.00 per share. All of the shares underlying such options have been fully vested. The agreement was terminated by us in accordance with its terms, upon the hiring of Greg H. Guettler as President in September 1997. On July 1, 1997, we granted Mr. Bois a stock option to purchase 12,500 shares at an exercise price of $2.00 per share. All of the shares underlying such options have been fully vested.

      On February 19, 1999, we granted Mr. Brimmer an option to purchase 10,000 shares of stock at $2.81 per share for extraordinary efforts during our initial public offering.

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This Item 11 is hereby amended to include information regarding the holdings of Common Stock of the Company of Mr. Wayne W. Mills, a greater than 5% beneficial owner of the Common Stock of the Company:

ITEM 11. Security Ownership of Certain Beneficial Owners and Management

      The following table presents, as of September 15, 2000, certain information regarding beneficial ownership of our Common Stock by (i) each person known by us to beneficially own more than 5% of the outstanding shares of Common Stock; (ii) each of our directors and executive officers; and (iii) all of our directors and executive officers as a group. Unless otherwise indicated, the persons listed below have sole voting and investment power with respect to the shares and may be reached at 2915 Waters Road, Suite 108, Eagan, MN 55121.

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SIGNATURES

      In accordance with Section 13 or 15(d) of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Dated: November 1, 2000

      In accordance with the requirements of the Exchange Act, this report has been signed below on behalf of the registrant and in the capacities indicated on November 1, 2000.

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