ANGEION CORP/MN
S-3, 1996-05-31
SURGICAL & MEDICAL INSTRUMENTS & APPARATUS
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    AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 31, 1996.

                                                   REGISTRATION NO. 333-

                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON D.C. 20549

                                   FORM S-3
                            REGISTRATION STATEMENT
                                    UNDER
                          THE SECURITIES ACT OF 1933


                             ANGEION CORPORATION
            (Exact name of registrant as specified in its charter)


           MINNESOTA                                     41-1579150
  (State or other jurisdiction              (I.R.S. Employer Identification No.)
of incorporation or organization)

                         3650 ANNAPOLIS LANE, SUITE 170
                        MINNEAPOLIS, MINNESOTA 55447-5434
                                 (612) 550-9388
    (Address, including zip code, and telephone number, including area code,
                  of registrant's principal executive offices)

                             DAVID L. CHRISTOFFERSON
                         3650 ANNAPOLIS LANE, SUITE 170
                        MINNEAPOLIS, MINNESOTA 55447-5434
                                 (612) 550-9388
    (Name, address, including zip code, and telephone number, including area
                           code, of agent for service)

                                  Copies to:
         Thomas C. Thomas, Esq.              John M. Westcott, Jr., Esq.
      Oppenheimer Wolff & Donnelly                  Hale and Dorr
 3400 Plaza VII, 45 South Seventh Street           60 State Street
          Minneapolis, MN 55402                   Boston, MA 02109
             (612) 344-9300                        (617) 526-6000

       Approximate date of commencement of proposed sale to the public: As soon
 as practicable after this Registration Statement becomes effective.

If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box: |_|

If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: |_|

If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. |_|

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. |_|

If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. |_|

                       CALCULATION OF REGISTRATION FEE

<TABLE>
<CAPTION>
                                                         PROPOSED       PROPOSED MAXIMUM
                                                          MAXIMUM           AGGREGATE         AMOUNT OF
     TITLE OF EACH CLASS OF          AMOUNT TO BE     OFFERING PRICE        OFFERING        REGISTRATION
  SECURITIES TO BE REGISTERED         REGISTERED        PER UNIT(1)         PRICE(1)             FEE

<S>                               <C>                    <C>               <C>                 <C>    
Common Stock, $.01 par value(2)   5,750,000 Shares       $10.4375          $60,015,625         $20,696
</TABLE>

(1) Estimated solely for the purpose of calculating the amount of the
    registration fee pursuant to Rule 457(c) under the Securities Act of 1933,
    based upon the average of the high and low sales prices of the registrant's
    Common Stock on May 29, 1996, as reported by the Nasdaq National Market.

(2) Each share of Common Stock includes a right to purchase, under certain
    circumstances, a fractional share of the registrant's Series B Junior
    Preferred Stock, $.01 par value.

The registrant hereby amends this registration statement on such date or dates
as may be necessary to delay its effective date until the registrant shall file
a further amendment which specifically states that this registration statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to Section 8(a), may
determine.

INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.



                   SUBJECT TO COMPLETION DATED MAY 31, 1996

                               5,000,000 SHARES

                            ANGEION CORPORATION LOGO

                                 COMMON STOCK

THE 5,000,000 SHARES OF COMMON STOCK, PAR VALUE $0.01 PER SHARE (THE "SHARES"),
OFFERED HEREBY ARE BEING ISSUED AND SOLD BY ANGEION CORPORATION ("ANGEION" OR
THE "COMPANY"). THE COMMON STOCK OF THE COMPANY IS TRADED ON THE NASDAQ NATIONAL
MARKET UNDER THE SYMBOL "ANGN." ON MAY 29, 1996, THE LAST REPORTED SALE PRICE OF
THE COMMON STOCK ON THE NASDAQ NATIONAL MARKET WAS $10.375.

      SEE"RISK FACTORS" BEGINNING ON PAGE 6 FOR A DISCUSSION OF CERTAIN FACTORS
         THAT SHOULD BE CONSIDERED BY PROSPECTIVE INVESTORS.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
 EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
   SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
    PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
      REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

<TABLE>
<CAPTION>
                                    UNDERWRITING
                    PRICE TO        DISCOUNTS AND       PROCEEDS TO
                     PUBLIC        COMMISSIONS(1)       COMPANY(2)
<S>             <C>              <C>                 <C>
Per Share       $                $                   $
Total(3)            $                  $                 $
</TABLE>


(1) The Company has agreed to indemnify the Underwriters against certain
    liabilities, including liabilities under the Securities Act of 1933, as
    amended (the "Securities Act"). See "Underwriting." 

(2) Before deducting estimated offering expenses of $250,000, which are payable
    by the Company.

(3) The Company has granted to the Underwriters a 30-day option to purchase up
    to 750,000 additional shares of Common Stock on the same terms and
    conditions as the securities offered hereby solely to cover over-allotments,
    if any. If the option is exercised in full, the Price to Public,
    Underwriting Discounts and Commissions and Proceeds to Company will be $ , $
    and $ , respectively. See "Underwriting."


THE SHARES OF COMMON STOCK ARE OFFERED SEVERALLY BY THE UNDERWRITERS SUBJECT
TO PRIOR SALE, WHEN, AS AND IF DELIVERED TO AND ACCEPTED BY THEM, AND SUBJECT
TO CERTAIN OTHER CONDITIONS INCLUDING THE RIGHT OF THE UNDERWRITERS TO
WITHDRAW, CANCEL, MODIFY OR REJECT ANY ORDER IN WHOLE OR IN PART. IT IS
EXPECTED THAT DELIVERY OF THE SHARES OF THE COMMON STOCK WILL BE MADE AT THE
OFFICES OF RAYMOND JAMES & ASSOCIATES, INC., ST. PETERSBURG, FLORIDA ON OR
ABOUT         , 1996.


RAYMOND JAMES & ASSOCIATES, INC.

                           NATWEST SECURITIES LIMITED

                                                            SALOMON BROTHERS INC

              The date of this Prospectus is _____________, 1996.


1.    Illustration: Internal view of heart of a patient showing the placement of
      the ICD in the pectoral region of the body and the leads threaded into the
      vein and into the ventricle of the heart. Two sketches surround
      illustration depicting the Defibrillation test system and programs in use
      during implant and a follow-up visit at the physician's office using the
      programmer/interrogator.

2.    Two page spread; background - mechanical illustrations of RF, laser
      catheter, Sentinel ICD cues and headers.

      A.    Center illustration of cross section of a heart depicting the
            chambers and electrical pathways of the heart.

3.    Photo of ICD system including ICD, computer programmer, Defibrillation
      test system, smart wand and transvenous leads.

4.    Photo of 3 models of Sentinel ICD.

5.    Closeup photo of tip of radio frequency ablation catheter.

6.    Closeup photo of tip of laser ablation catheter.


                                   SUMMARY

THE FOLLOWING SUMMARY IS QUALIFIED IN ITS ENTIRETY BY THE MORE DETAILED
INFORMATION AND FINANCIAL STATEMENTS AND NOTES THERETO CONTAINED ELSEWHERE OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS. INVESTORS SHOULD CAREFULLY
CONSIDER THE INFORMATION SET FORTH UNDER THE HEADING "RISK FACTORS." UNLESS
OTHERWISE INDICATED, ALL INFORMATION CONTAINED IN THIS PROSPECTUS ASSUMES NO
EXERCISE OF THE UNDERWRITERS' OVER-ALLOTMENT OPTION.

                                 THE COMPANY

Angeion Corporation designs, develops and manufactures products that treat and
potentially cure irregular heartbeats (arrhythmias). The Company is developing
the SENTINEL series of implantable cardioverter defibrillators ("ICDs"), which
it believes are among the smallest and most technologically advanced ICDs
currently in clinical trials or market-approved. ICDs are designed to treat
rapid heartbeats in the ventricular (or lower) chambers of the heart, a
condition known as ventricular tachycardia ("VT"), and a severe form of VT known
as ventricular fibrillation ("VF"), which if not terminated will lead to sudden
cardiac death ("SCD"). ICDs are electronic devices that are implanted within the
body and are connected to the heart with defibrillator leads. These devices
monitor the patient's heartbeat and, in the event of VT or VF, deliver an
electrical shock to return the heartbeat to normal rhythm. Following receipt of
an Investigational Device Exemption ("IDE") from the U.S. Food and Drug
Administration ("FDA"), the Company commenced U.S. clinical trials of its first
SENTINEL model, the SENTINEL 2000, in March 1996. In April 1996, the Company
received CE Mark approval to market the SENTINEL 2000 in the European Union
("EU"). Based on its clinical trial progress to date, the Company plans to
submit its application for Pre-Market Approval ("PMA") for the SENTINEL 2000 and
the SENTINEL 2010 series of products to the FDA in the first half of calendar
1997.

The worldwide market for ICDs and defibrillator leads has grown from $160
million in 1990 to over $650 million in 1995, representing a compounded annual
growth rate in excess of 30%. It is estimated that in 1995 over 25,000 ICDs were
implanted worldwide. The ICD market is expected to continue to grow at an annual
rate of 20% to 25% to reach a worldwide market size of approximately $1.5
billion by the end of the decade. The growth rate for this market is
attributable to a number of factors, including: (i) expansion of the indications
for use of an ICD; (ii) smaller devices allowing for less invasive and less
costly surgical procedures; (iii) disappointing performance of drug therapy
compared with ICDs; (iv) an increasing survival rate for SCD episodes; and (v)
rapidly advancing ICD technology.

The Company believes the SENTINEL series of ICDs offers certain benefits over
competitors' ICDs currently in clinical trials or market-approved, including
reduced size and weight, increased longevity and greater flexibility in
treatment options. These benefits are derived from the Company's proprietary
product features and technologies, including: (i) its dual battery system; (ii)
a more efficient biphasic waveform that lowers defibrillation energy thresholds;
(iii) the HOT CAN electrode system, which uses the SENTINEL housing as an
electrode that can be programmed on and off; and (iv) an energy delivery system
that permits the ICD to increase shock effectiveness by directing the current
more uniformly throughout the heart.

The Company is also developing a radio frequency ("RF") catheter ablation system
that it believes will provide a potential cure for certain forms of atrial
arrhythmias (rapid heartbeats originating in the upper chambers of the heart)
and a laser catheter ablation system that it believes will provide a potential
cure for certain forms of VT. The Company has received an IDE from the FDA for
both its RF and laser catheter ablation systems and plans to expand human
clinical trials of both systems during the second half of calendar 1996.

Although the market for catheter ablation devices in the treatment of
arrhythmias is much less defined and in an earlier stage of development than the
ICD market, the U.S. ablation market has grown from 1,500 procedures in 1990 to
over 55,000 procedures in 1995, representing a compounded annual growth rate in
excess of 100%. Industry sources project the cardiac ablation market could reach
250,000 procedures by the year 2000, which would equate to a market size of
approximately $300 million. In addition, if cardiac ablation becomes an accepted
treatment for atrial fibrillation, the aggregate market for cardiac ablation
could total $1.0 billion by 2005. The following factors are driving the growth
of this market: (i) catheter ablation offers a potential cure for certain forms
of arrhythmia rather than simply managing its symptoms; (ii) catheter ablation
is a cost-effective, minimally invasive procedure; and (iii) advancements in
electrophysiology mapping technology are expected to allow more effective
identification of the source of the arrhythmia.

The Company believes its ablation products offer distinct advantages over
competitive products and techniques currently in clinical trials or
market-approved. The Company's RF catheter ablation system uses a proprietary
saline-cooled porous metal tip that prevents the formation of coagulum during
the ablation procedure and delivers the energy into the tissue more efficiently.
The Company's RF catheter ablation system is designed to treat atrial
arrhythmias known as supraventricular tachycardia ("SVT"). Future models of this
catheter are being designed to provide ablative patterns to treat other atrial
arrhythmias, such as atrial flutter and atrial fibrillation. Generally, the
ventricular wall (muscle) is too thick to be fully penetrated by RF energy. The
Company intends to address ventricular arrhythmias, such as VT, with the
application of laser energy. The Company's laser catheter ablation system is
being developed to deliver laser energy to aberrant cells in the ventricular
wall to produce full transmural lesions.

The Company intends to market and sell its ICD and catheter ablation products on
a worldwide basis through three channels: (i) a direct Company sales force in
the United States; (ii) independent sales representatives and distributors
outside the United States; and (iii) its strategic alliance with Pacesetter,
Inc. ("Pacesetter"), which has the second largest cardiovascular distribution
network in the world and is a subsidiary of St. Jude Medical, Inc. In
preparation for product launch of the SENTINEL 2000 in Europe, the Company has
formed a European subsidiary and established distributorships or direct sale
representation in a number of European countries. The Company's manufacturing
facility in Minneapolis, Minnesota, as well as the facility of the Company's
contract manufacturer in Scotland, has received ISO 9002 certification.

The Company's business strategy is to build a full line of electrophysiology
products for the treatment and cure of cardiac arrhythmias. The Company is
focused on one area of cardiovascular disease, cardiac arrhythmias, and one
common practitioner, the electrophysiologist. In pursuit of its strategy, the
Company has developed innovative ICD and catheter ablation technologies;
assembled a management, research, engineering and medical team with significant
medical device industry experience; built what it believes to be a strong patent
portfolio; and entered into a strategic alliance with Pacesetter to provide
timely access to worldwide markets.

The Company was incorporated in Minnesota in May 1986. The Company's principal
executive offices are located at 3650 Annapolis Lane, Suite 170, Minneapolis,
Minnesota 55447-5434, and its telephone number at that location is (612)
550-9388.

ANGEION(R), SENTINEL(tm), SMALL CAP(tm), HOT CAN(tm), ENERGY STEERING(tm), SMART
WAND(tm), TUNED(tm) Biphasic Waveform, ANGEPASS(tm), ANGEPORE(tm), and
ANGEFLEX(tm) are trademarks of the Company. All other trademarks and trade names
used herein are the property of their respective owners.

                                 THE OFFERING

Common Stock Offered .............. 5,000,000 shares

Common Stock to be Outstanding .... 29,212,207 shares
after the Offering (1) 

Use of Proceeds ................... Expansion of clinical trials,
                                    research and development, scale-up and
                                    expansion of manufacturing and marketing
                                    activities, potential acquisitions and
                                    general corporate purposes, including
                                    working capital.

Nasdaq National Market Symbol ..... ANGN 



(1) Based on the number of shares of Common Stock outstanding on April 30,
    1996. Does not include 3,425,066 shares reserved for issuance upon the
    exercise of outstanding options and warrants and 1,125,000 shares
    issuable upon conversion of the Series A Preferred Stock and a
    convertible debenture. See "Description of Securities."

                             SUMMARY FINANCIAL DATA

<TABLE>
<CAPTION>
                                                  YEAR ENDED JULY 31,                   NINE MONTHS ENDED APRIL 30,
                                         1993             1994            1995            1995             1996
<S>                                   <C>             <C>              <C>             <C>             <C>
STATEMENT OF OPERATIONS DATA:
Net sales                             $   137,982     $         0      $         0     $         0     $    874,959
Manufacturing expenses (1)                147,755               0                0               0        2,278,242
Research and development                4,485,818       5,158,738        7,815,391       5,268,028        6,717,469
Sales and marketing (2)                         0               0                0          12,767          387,634
General and administrative              1,353,502       1,460,424        1,849,376       1,495,868        2,444,543
Net loss (3)                          $(2,708,438)    $(7,675,743)     $(9,643,351)    $(6,673,157)    $(10,161,744)
Net loss per share (3)(4)             $     (0.26)    $     (0.72)     $     (0.58)    $     (0.41)    $      (0.46)
Weighted average number of shares
 outstanding (4)                       10,296,812      10,657,311       16,550,915      16,291,900       21,953,593
</TABLE>


<TABLE>
<CAPTION>
                                                      APRIL 30, 1996
                                                 ACTUAL       AS ADJUSTED (5)
<S>                                           <C>             <C>
BALANCE SHEET DATA:
Cash and cash equivalents                     $ 14,789,510     $ 63,431,698
Short-term investments                           7,328,201        7,328,201
Working capital                                 22,953,009       71,595,197
Total assets                                    30,572,968       79,215,156
Long-term debt, less current installments        1,500,000        1,500,000
Accumulated deficit                            (37,347,476)     (37,347,476)
Shareholders' equity                            26,445,804       75,087,992
</TABLE>

(1) The amount reflected in manufacturing expenses for the year ended July
    31, 1993 reflects cost of goods sold for that period.

(2) Sales and marketing for the years ended July 31, 1993 through 1995 is
    contained in general and administrative expense.

(3) Net loss and net loss per share for the year ended July 31, 1993 reflect a
    gain on sale of discontinued operations of $3,207,120, or $0.31 per share,
    resulting from the sale of the Angeion Medical Products division ("AMP").

(4) Computed on the basis described for net loss per share in Note 2 of Notes to
    Financial Statements.

(5) Adjusted to give effect to the sale of the Shares offered hereby at an
    assumed per share offering price of $10.375 and application of the
    estimated net proceeds therefrom. See "Use of Proceeds."

                                 RISK FACTORS

THE SHARES OFFERED HEREBY INVOLVE A HIGH DEGREE OF RISK, INCLUDING THE RISKS
DESCRIBED BELOW. PROSPECTIVE INVESTORS SHOULD CAREFULLY CONSIDER THE FOLLOWING
RISK FACTORS TOGETHER WITH THE OTHER INFORMATION CONTAINED IN THIS PROSPECTUS
BEFORE PURCHASING THE SHARES OFFERED HEREBY.

THIS PROSPECTUS CONTAINS CERTAIN FORWARD-LOOKING STATEMENTS. FOR THIS PURPOSE,
ANY STATEMENTS CONTAINED IN THIS PROSPECTUS THAT ARE NOT STATEMENTS OF
HISTORICAL FACT MAY BE DEEMED TO BE FORWARD-LOOKING STATEMENTS. WITHOUT LIMITING
THE FOREGOING, WORDS SUCH AS "MAY," "WILL," "EXPECT," "BELIEVE," "ANTICIPATE,"
"ESTIMATE" OR "CONTINUE" OR THE NEGATIVE OR OTHER VARIATIONS THEREOF OR
COMPARABLE TERMINOLOGY ARE INTENDED TO IDENTIFY FORWARD-LOOKING STATEMENTS.
THESE STATEMENTS BY THEIR NATURE INVOLVE SUBSTANTIAL RISKS AND UNCERTAINTIES,
AND ACTUAL RESULTS MAY DIFFER MATERIALLY DEPENDING ON A VARIETY OF FACTORS,
INCLUDING THOSE DESCRIBED BELOW.

CONTINUING OPERATING LOSSES; PROFITABILITY UNCERTAIN; FLUCTUATIONS IN
OPERATING RESULTS

The Company has incurred net operating losses from continuing operations in each
year since its inception in 1986. At April 30, 1996, the Company's accumulated
deficit was approximately $37.3 million. Losses have resulted principally from
costs incurred in the research and development of the Company's products. The
Company has had no significant revenue since the sale of AMP in September 1992.
The Company expects to incur additional operating losses over the next several
years as the Company continues to fund research and development (including
clinical trials) relating to its ICDs and catheter ablation systems and invests
in building its manufacturing and marketing capabilities. The Company's ability
to achieve profitability is dependent in part on obtaining regulatory approvals
for its products and developing the capacity to manufacture and sell its
products successfully. There can be no assurance that the Company will obtain
the required regulatory approvals on a timely basis or at all, successfully
develop, commercialize, manufacture and market its products, or achieve
profitability. In addition, the Company's results of operations may fluctuate
significantly from quarter to quarter depending upon a number of factors,
including the availability of third party reimbursement, the timing of
regulatory approvals, progress of product development and clinical trials, the
extent to which the Company's products gain market acceptance, marketing and
manufacturing costs and competition.

COMPETITION

Competition in the ICD market is intense. Although the Company's ICDs will also
compete with alternative treatments for VT such as drug therapy, open heart
surgery and cardiac ablation, the Company believes that ICD manufacturers
constitute its primary competition. There can be no assurance that FDA approval
will ever be obtained for the SENTINEL series ICDs, that competitors will not
introduce new products with similar features or that the market will accept the
SENTINEL series. Most of the Company's competitors in the ICD market have
greater financial, manufacturing, marketing, distribution and technical
resources and greater name recognition than the Company.

A number of companies, certain of which are large with significant resources,
have developed RF catheter ablation devices to treat SVT. There can be no
assurance that competitors of the Company will not be able to develop and
introduce cardiac ablation systems more quickly than the Company or systems that
may be more effective in treating SVT and VT than the Company's cardiac ablation
systems. In addition, there can be no assurance that the Company's catheter
ablation systems will receive FDA approval or, if approved, that the market will
accept such systems. Catheter ablation technologies also compete with drug
therapy. While historically drug therapy has had limited effectiveness and
caused adverse side effects, new drugs under development may offer improved
treatment outcomes. See "Business -- Competition."

INTELLECTUAL PROPERTY PROTECTION

Patents and trademarks are critical in the medical device industry. There can be
no assurance that patents and trademarks will be granted to the Company in the
future, or that any patents and trademarks that the Company now holds or may be
granted or under which it has been granted licenses will be valid or otherwise
be of value. Even if the Company's patents and trademarks are granted, others
may be able to challenge the validity of such patents and trademarks or
introduce non-infringing products that are competitive with those of the
Company.

The Company conducts an ongoing evaluation of potential infringement of any
proprietary rights of third parties by the products the Company intends to
market. Regardless of the Company's efforts to evaluate the potential
infringement of any proprietary rights of third parties, however, there can be
no assurance that such infringements do not exist or may not arise in the
future. There has been substantial litigation regarding patent and other
intellectual property rights in the medical device industry, particularly in
the ICD market. Litigation, which could result in substantial cost to and
diversion of effort by the Company, may be necessary to enforce patents issued
to or licensed by the Company, to protect trade secrets or technology owned by
the Company or to defend the Company against claimed infringement of the rights
of others and to determine the scope and validity of the proprietary rights of
others. Adverse determinations in litigation could subject the Company to
significant liabilities to third parties or could require the Company to seek
licenses from third parties.

Although patent and intellectual property disputes in the medical device area
have often been settled through licensing or similar arrangements, costs
associated with such arrangements may be substantial and there can be no
assurance that necessary licenses would be available to the Company on
satisfactory terms, if at all. Accordingly, an adverse determination in a
judicial or administrative proceeding or failure to obtain necessary licenses
could prevent the Company from manufacturing and selling its products, which
would have a material adverse effect on the Company. The license agreement
currently in existence between the Company and Pacesetter may affect the ability
of the Company to settle any intellectual property disputes related to the
Company's products on reasonable terms or at all, which could have a material
adverse effect on the Company.

The Company also relies on trade secrets and proprietary technology, which it
seeks to protect, in part, through confidentiality agreements with employees,
consultants and other parties. There can be no assurance, however, that these
agreements will not be breached, that the Company would have adequate remedies
for such breach, or that the Company's trade secrets will not otherwise become
known to or independently developed by competitors. See "Business --
Intellectual Property."

GOVERNMENT REGULATION

The medical products the Company plans to market are subject to regulation in
the U.S. by the FDA. The process of complying with regulations with respect to
new products can be costly and time-consuming. The Company's ICD and catheter
ablation products are subject to a lengthy and expensive PMA application
approval process with the FDA. Such process requires the Company to conduct
lengthy human clinical trials with respect to its products. The data collected
in such clinical trials (both in and outside the U.S.) are used to prepare the
PMA applications for such products. If such PMA applications are accepted for
filing by the FDA, they will be reviewed further by the FDA and its Circulatory
System Devices Panel. After considering the panel's recommendation, the FDA will
determine whether to approve such PMA applications. Approval of the Company's
applications for PMAs for the SENTINEL ICDs and its catheter ablation systems
will depend on a wide variety of factors, many of which are outside the
Company's control. Approval will also require an inspection by the FDA to
determine whether the Company's operations conform with the FDA's current Good
Manufacturing Practices. There can be no assurance that the Company will be
successful in obtaining a PMA for its products, in a timely manner, if at all.
Delays in obtaining marketing approvals and clearances in the U.S. could have a
material adverse effect on the Company. The Company is also subject to certain
FDA regulations governing manufacturing practices, packaging and labelling, and
failure to comply with these requirements could also adversely impact the
Company.

The Company will not be able to commence marketing and commercial sales of its
products in the U.S. until it receives FDA approval, which will only be granted
following filing of a PMA application. Until the Company receives PMA approval,
the Company will be subject to FDA-imposed limitations on the number of ICD
implants and catheter ablation procedures that may be performed as well as the
number and location of clinical sites at which implants and procedures may be
performed. As the Company approaches these limitations, it would be required to
apply to the FDA for approval of additional implants and procedures, but there
can be no assurance that such approval will be received on a timely basis, if at
all. The Company would be unable to sell additional ICDs or conduct additional
catheter ablation procedures in the U.S. should the number reach the limits
authorized by the FDA. The timing of both the IDE and PMA review processes is
unpredictable and uncertain, and the failure to obtain the necessary approvals
on a timely basis would have a material adverse effect on the Company. See
"Business -- Products."

The Company's products are also subject to regulation in foreign countries by
agencies comparable to the FDA. Although the Company has obtained a CE Mark for
the SENTINEL 2000 that allows the Company to commence marketing of the SENTINEL
2000 in countries that are members of the EU and the European Free Trade
Association, subject to limited regulations in certain countries, there can be
no assurance that the Company will be successful in obtaining CE Mark approval
for any other products, in a timely manner, if at all, which could have a
material adverse effect on the Company. See "Business -- Government Regulation."

PACESETTER RELATIONSHIP

The Company and Pacesetter are parties to a Preferred Stock, Preferred Stock
Option and Subordinated Debenture Purchase Agreement (the "Purchase Agreement"),
an OEM Marketing and Manufacturing Agreement (the "OEM Agreement") and a License
Agreement (the "License Agreement"). The Purchase Agreement provides that, until
one year after PMA approval of the Company's first ICD (other than the SENTINEL
2000), Pacesetter will have a right of first refusal any time the Company
receives an offer for the purchase, license, lease or transfer of all or a
substantial portion of the Company's assets or business or for the purchase of a
majority interest in the capital stock of the Company. In connection with this
right of first refusal, Pacesetter will have 21 days after notice to determine
whether it will exercise its right by proceeding with the transaction on the
same terms and conditions as are set forth in such offer. This right of first
refusal could have the effect of delaying, deferring or preventing a change in
control of the Company, which could operate to deny shareholders the receipt of
a premium on their Common Stock and could have a depressive effect on the market
price for the Common Stock. See "-- Anti-Takeover Considerations."

Pursuant to the OEM Agreement, if the Company fails to fulfill all product
quantity, quality and specification requirements with respect to the Company's
ICD and laser catheter ablation products, Pacesetter may elect to manufacture
these products and pay the Company a royalty that is substantially less than the
transfer price payment the Company would have received had it manufactured the
products and sold them to Pacesetter. There can be no assurance that the Company
will be able to fulfill these requirements, and the failure to do so could have
a material adverse effect on the Company. See "Business -- Manufacturing."

The License Agreement also grants Pacesetter a conditional right to sublicense
certain of the Company's ICD patents and patent applications in existence at the
time of the License Agreement (and certain continuation applications) to up to
three separate parties, provided that the Company receives the same
cross-licenses from the sublicensee as Pacesetter receives (or, if Pacesetter
also sublicenses 20 or more of its own patents or patent applications, that
Pacesetter uses its best efforts to secure such cross-licenses for the Company).
Pacesetter is under a pre-existing obligation, by virtue of a previous license
agreement with a major competitor, to license certain patent rights that
Pacesetter may acquire to such competitor, and the Company is aware that a
dispute has arisen between these parties with respect to the ability of
Pacesetter to receive royalties or negotiate cross-licenses with such competitor
in connection with the ICD patents and patent applications that are subject to
sublicensing under the License Agreement. Because the Company is not a party to
this dispute, the Company has no control over or knowledge of any potential
outcome of this dispute and is not necessarily bound by the outcome of this
dispute. Pacesetter has also recently initiated a lawsuit against Cardiac
Pacemakers, Inc. ("CPI") relating to certain pacemaker and ICD patents. Although
at this time the ICD patents and patent applications of the Company that are
subject to the License Agreement are not at issue in this lawsuit, the Company
has no control over whether such patents and patent applications will become
involved in such lawsuit. There can be no assurance that the Company will
receive necessary cross-licenses from third parties in exchange for the grant of
sublicenses to the ICD patents and patent applications that are subject to the
License Agreement. See "Business -- Intellectual Property."

MARKET ACCEPTANCE

Market acceptance of the Company's products will depend, in part, on the
therapeutic capabilities and operating features of its products as compared to
competing products, the Company's ability to demonstrate to the medical
community the clinical efficacy of its products and its ability to manufacture
quality products in sufficient quantities. Failure of the Company's products to
gain market acceptance would have a material adverse effect on the Company.

DEPENDENCE ON SENIOR MANAGEMENT AND OTHER KEY PERSONNEL

The Company's success depends largely on its senior management and other key
personnel. Competition for personnel with significant experience in the medical
device industry is intense. Accordingly, the loss of the services of such
individuals or the inability to hire additional key individuals as required
could have a material adverse effect on the Company and on its current and
future product development efforts. The Company has purchased a $2.0 million
policy of key-person life insurance on its Chairman, President and Chief
Executive Officer. See "Management."

UNCERTAINTY OF THIRD PARTY REIMBURSEMENT AND HEALTH CARE REFORM

The Company's ability to market its products successfully in the U.S. will
depend in part on the extent to which reimbursement for the cost of such
products and related treatment will be available from government health
administration authorities (such as the Health Care Financing Administration
("HCFA"), which determines Medicare reimbursement levels), private health
insurers, health maintenance organizations and other third-party payors. Payors
are increasingly challenging the need for and prices of medical products and
services. Payors may deny reimbursement for procedures that they deem
experimental or for devices that are used other than for FDA-approved
indications. Currently, HCFA does not allow Medicare reimbursement for certain
kinds of products and related procedures that have not received PMA approval and
for which underlying questions of safety and effectiveness have not been
resolved, and certain private third-party payors have also begun denying such
reimbursement. Although the Company's ICDs and catheter ablation products are
currently being reimbursed by HCFA and third-party payors, there can be no
assurance that HCFA and the third-party payors will continue to reimburse such
products in the future. Even if some products are approved for reimbursement,
some payors may deny coverage until the procedure becomes generally accepted by
the medical profession. The inability of hospitals and other providers to obtain
reimbursement from third-party payors for the Company's products and related
procedures would have a material adverse effect on the Company.

The Company expects that there will be continued pressure on cost-containment
throughout the U.S. health care system. Reforms may include mandated basic
health care benefits, controls on health care spending through limitations on
the growth of private health insurance premiums and Medicare and Medicaid
spending, the creation of large insurance purchasing groups and fundamental
changes to the health care delivery system. The Company anticipates that
Congress and state legislatures will continue to review and assess alternative
health care delivery systems and payment methodologies and public debate of
these issues will likely continue in the future. Due to uncertainties regarding
the ultimate features of reform initiatives and their enactment and
implementation, the Company cannot predict which, if any, of such reform
proposals will be adopted, when such proposals may be adopted or what impact
they may have on the Company. See "Business -- Third Party Reimbursement."

DEPENDENCE ON THIRD PARTY VENDORS

The Company relies on third party vendors for certain of the components used in
the Company's products and for certain contract manufacturing services. A number
of key components, such as batteries, integrated circuits, capacitors and
defibrillator lead systems used in the Company's ICDs are supplied by sole
source suppliers. For certain of these components and manufacturing services,
there are relatively few alternative sources of supply, and establishing
alternative or replacement vendors cannot be accomplished quickly. In addition,
each component and each vendor must be qualified with the FDA, and there can be
no assurance that alternative vendors can be identified and qualified on a
timely basis or at all. Any significant interruption in the supply of such
components or manufacturing services would have a material adverse effect on the
Company. See "Business -- Manufacturing."

LIMITED MANUFACTURING AND MARKETING EXPERIENCE

To date, the Company's products have been manufactured in limited quantities for
clinical testing purposes and have not been manufactured on a commercial scale.
As a result, there can be no assurance that the Company will not encounter
difficulties in scaling up its manufacturing capabilities, including problems
involving production yields, quality control, component supply and shortages of
qualified manufacturing personnel. Any such difficulties could also result in
the inability of the Company to satisfy Pacesetter's product requirements, which
could result in a royalty from Pacesetter that is significantly lower than the
transfer price payment the Company would have otherwise received. Any
significant manufacturing difficulties could have a material adverse effect on
the Company.

Management of the Company has limited experience in marketing the Company's ICD
and catheter ablation products, sales of which to date have consisted of a
limited number for use in clinical trials. There can be no assurance that the
Company will be able to recruit and retain the necessary sales managers, direct
salespersons, independent sales representatives or distributors needed or that
the Company's efforts to scale up its marketing capabilities will be successful.
See "Business -- Sales and Marketing."

POSSIBLE OBSOLESCENCE DUE TO TECHNOLOGICAL CHANGE

The medical device industry is subject to rapid technological innovation and,
consequently, the life cycle of a particular product tends to be relatively
short. The Company is engaged in a field characterized by extensive research and
development efforts. There can be no assurance that alternative treatments or
other discoveries and developments with respect to ICDs or catheter ablation
systems will not render the Company's products obsolete. Furthermore, the
greater financial and other resources of many of the Company's competitors may
permit such competitors to respond more rapidly than the Company to
technological advances. See "Business -- Competition."

NEED FOR ADDITIONAL FINANCING

The Company may need additional financing following completion of this offering
depending on a number of factors, including: (i) progress with clinical trials;
(ii) time and costs involved in obtaining regulatory approvals; (iii) costs
involved in filing, prosecuting and enforcing patents or defending against
patent infringement claims; (iv) competing technological and market
developments; (v) costs of manufacturing and marketing scale-up; and (vi)
potential acquisitions. To the extent that additional financing is needed,
however, there can be no assurance that such additional financing would be
available on acceptable terms, if at all, and the failure to obtain any such
additional financing would have a material adverse effect on the Company. See
"Management's Discussion and Analysis of Financial Condition and Results of
Operations."

DILUTION

Purchasers of the shares of Common Stock offered hereby will experience an
immediate dilution in net tangible book value. See "Dilution."

IMPACT OF SHARES ELIGIBLE FOR FUTURE SALE

Upon completion of this offering, based on the number of outstanding shares of
Common Stock as of April 30, 1996, the Company will have approximately 29.2
million shares of Common Stock outstanding (30.0 million shares if the
Underwriters' over-allotment option is exercised in full), assuming no exercise
of outstanding options or warrants and no conversion of an outstanding
convertible debenture or shares of Series A Preferred Stock. Substantially all
of such shares are eligible for immediate resale following completion of this
offering as a result of having been registered for resale under the Securities
Act, pursuant to the provisions of Rule 144 or otherwise. In addition, on April
30, 1996, the Company filed a registration statement registering the resale of
1,269,849 shares of Common Stock issued or issuable upon exercise of certain
outstanding warrants and 1,125,000 shares of Common Stock issuable upon
conversion of a convertible debenture and shares of Series A Preferred Stock
held by Pacesetter. The directors and officers of the Company and certain of
their affiliates, beneficially owning as of April 30, 1996, an aggregate of
2,515,886 shares of Common Stock, have agreed not to sell or otherwise transfer
shares of Common Stock held by them or issuable to them upon exercise or
conversion of options, warrants or other securities (including 324,999 of the
shares subject to the registration statement filed on April 30, 1996) for the
period beginning June 1, 1996 and ending 90 days after the effective date of the
registration statement of which this Prospectus is a part (the "Registration
Statement"), inclusive (the "Lock-up Period"). Nevertheless, sales of shares of
Common Stock in the public market during or following expiration of the Lock-up
Period could adversely affect the market price of the Common Stock. See
"Underwriting."

SUFFICIENCY OF PRODUCT LIABILITY INSURANCE

The testing, manufacturing, marketing and sale of medical devices involves risk
of liability claims and product recalls. As a result, the Company currently
carries product liability insurance covering its products with policy limits of
$5.0 million per occurrence and $5.0 million in the aggregate. It cannot be
predicted, however, whether such insurance is sufficient, or if not, whether the
Company will be able to obtain such insurance as is sufficient, to cover the
risks associated with the Company's business or whether such insurance will be
available at premiums that are commercially reasonable. Lack of sufficient
insurance could expose the Company to substantial damages in connection with
product liability claims or product recalls.

ANTI-TAKEOVER CONSIDERATIONS

The Company's Restated Articles of Incorporation (i) authorize the Company's
Board of Directors, without any action by the shareholders, to establish the
rights and preferences of up to 3,000,000 shares of undesignated preferred stock
(of which 1,225,000 shares remain undesignated as of the date of this
Prospectus) and (ii) provide that the affirmative vote of at least two-thirds of
the voting power of the shares entitled to vote is necessary in connection with
a merger, consolidation or transfer of substantially all of the Company's
assets. The Company also is subject to certain "anti-takeover" provisions of the
Minnesota Business Corporations Act, and the Purchase Agreement with Pacesetter
provides Pacesetter, for a certain period of time, with a right of first refusal
in connection with any sale of the Company or its assets. In addition, in April
1996 the Company's Board of Directors adopted a Shareholder Rights Plan designed
to protect the Company and its shareholders from unsolicited attempts or
inequitable offers to acquire the Company. These measures may, in certain
circumstances, deter or discourage takeover attempts and other changes in
control of the Company not approved by the Board. As a result, the Company's
shareholders may lose opportunities to dispose of their shares at the higher
prices generally available in takeover attempts or that may be available under a
merger proposal. In addition, these measures may have the effect of permitting
the Company's current members of the Board to retain their positions and place
them in a better position to resist changes that shareholders may wish to make
if they are dissatisfied with the conduct of the business of the Company. See
"Description of Securities."

LACK OF PROSPECTIVE DIVIDENDS

The Company has not paid dividends on its Common Stock and does not anticipate
paying cash dividends in the foreseeable future. The Company intends to retain
any earnings to finance the development of its business. In addition, as long as
shares of Series A Preferred Stock are outstanding, in the event that dividends
are paid on the Common Stock, holders of such Series A Preferred Stock shall be
entitled to an equivalent dividend on the basis of the number of shares of
Common Stock into which the Series A Preferred Stock is then convertible. There
can be no assurance that the Company will ever pay cash dividends. See "Dividend
Policy."

VOLATILITY OF STOCK PRICE

The market prices for securities of medical device companies have historically
been highly volatile, including the market price of shares of the Company's
Common Stock. Future announcements by the Company or its competitors, including
announcements concerning strategic collaborations, results of clinical testing,
technological innovations or new commercial products, changes in government
regulations, regulatory actions, health care legislation, proprietary rights,
litigation and public concerns as to safety of the Company's or its competitors'
products, as well as period-to-period variances in financial results, could
cause the market price of the Common Stock to fluctuate substantially for
reasons that may be unrelated or disproportionate to the operations of the
Company.

                               USE OF PROCEEDS

The net proceeds to the Company from the sale of the Shares offered hereby,
after deducting underwriting discounts and commissions and estimated offering
expenses, and assuming a public offering price of $10.375 per share, are
estimated to be $48,642,188 ($55,976,016 if the Underwriters' over-allotment
option is exercised in full).

The Company anticipates that the net proceeds of this offering will be used to
fund expansion of clinical trials, research and development, scale-up and
expansion of the Company's manufacturing and marketing activities and for
general corporate purposes, including working capital. A portion of the net
proceeds may also be used to fund collaborative arrangements or acquisitions of
or investments in complementary businesses, products or technologies, although
no such transactions are currently pending.

The expected use of the net proceeds from this offering is subject to change
based upon factors such as progress of clinical trials, time and costs involved
in obtaining regulatory approvals, costs involved in filing, prosecuting and
enforcing patents and defending against patent infringement claims, competing
technologies and market developments and the cost of manufacturing and marketing
scale-up and expansion. The Company may require additional capital after this
offering depending on a number of factors, and there can be no assurance that
any such additional capital will be available on acceptable terms, if at all.
See "Management's Discussion and Analysis of Financial Condition and Results of
Operations."

Prior to the use of the proceeds of this offering, the Company will invest such
proceeds in short-term, interest-bearing instruments, such as certificates of
deposit and short-term government obligations.

                                   DILUTION

The net tangible book value of the Common Stock of the Company as of April 30,
1996 (based on the unaudited financial statements included herein) was
$21,954,029 or $0.907 per share. "Net tangible book value" per share of Common
Stock represents the total tangible assets of the Company reduced by the total
liabilities and convertible preferred stock of the Company and divided by the
number of shares of Common Stock outstanding. Upon completion of this offering,
after deducting estimated offering expenses and selling commissions and at an
assumed offering price of $10.375 per share, the adjusted net tangible book
value of the Common Stock of the Company as of April 30, 1996 would have been
$70,596,217 or $2.417 per share. The increase in net tangible book value of
$1.510 per share would be due solely to the purchase of the Shares in this
offering. Purchasers in this offering will immediately incur a dilution of
$7.958 per share from the $10.375 assumed offering price of the Shares sold
hereby. "Dilution" is determined by subtracting net tangible book value per
share after the offering from the offering price.

The following table illustrates the resulting dilution in net tangible book
value per share with respect to the Common Stock offered hereby:

<TABLE>
<CAPTION>
<S>                                                               <C>        <C>
Assumed public offering price per share                                      $10.375
  Net tangible book value per share at April 30, 1996             $0.907
  Increase per share attributable to new investors                 1.510
Pro forma net tangible book value per share after offering                     2.417
Dilution in net tangible book value per share to new
 investors                                                                   $ 7.958
</TABLE>

                                CAPITALIZATION

The following table sets forth the capitalization of the Company at April 30,
1996, and as adjusted to reflect the net proceeds from the sale by the Company
of 5,000,000 shares of Common Stock pursuant to this offering (at an assumed
public offering price of $10.375 per share). See "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and the Company's
financial statements and related notes contained elsewhere in this Prospectus.

<TABLE>
<CAPTION>
                                                                  APRIL 30, 1996
                                                              ACTUAL        AS ADJUSTED
<S>                                                        <C>              <C>
Long-term debt                                             $  1,500,000     $  1,500,000
Shareholders' equity:
  Convertible preferred stock, series A, $0.01 par
   value.
   Authorized 1,475,000 shares; issued and outstanding
   875,000 shares                                             3,166,425        3,166,425
  Common stock, $0.01 par value.
   Authorized 35,000,000 shares; issued and outstanding
   24,212,207 shares, 29,212,207 shares as adjusted(1)          242,122          292,122
  Additional paid-in capital                                 60,384,733      108,976,921
  Accumulated deficit                                       (37,347,476)     (37,347,476)
   Total shareholders' equity                                26,445,804       75,087,992
    Total capitalization                                   $ 27,945,804     $ 76,587,992

</TABLE>

(1) Does not include 3,425,066 shares of Common Stock issuable upon exercise of
    options and warrants outstanding at April 30, 1996.

                               DIVIDEND POLICY

The Company has not paid dividends on its Common Stock and does not anticipate
paying cash dividends in the foreseeable future. The Company intends to retain
any earnings to finance the development of its business. In addition, as long as
shares of the Company's Series A Preferred Stock are outstanding, in the event
that dividends are declared on the Common Stock of the Company, holders of the
Series A Preferred Stock shall be entitled to receive an equivalent dividend on
the basis of the number of shares of Common Stock into which such holder's
shares of Series A Preferred Stock are then convertible. There can be no
assurance that the Company will ever pay cash dividends.

                        MARKET PRICE FOR COMMON STOCK

The Common Stock is currently traded over-the-counter on the Nasdaq National
Market under the symbol "ANGN." Prior to October 19, 1995, the Common Stock was
traded on the Nasdaq SmallCap Market. The following table sets forth, for each
of the calendar periods indicated, the range of high and low closing bid
quotations per share until October 19, 1995, as reported by the Nasdaq SmallCap
Market, and the range of high and low closing sale prices of the Common Stock,
as reported by the Nasdaq National Market. These prices do not include
adjustments for retail mark-ups, mark-downs or commissions (and prior to October
19, 1995, represent inter-dealer quotations and do not necessarily represent
actual transactions).


<TABLE>
<CAPTION>
                                                      COMMON STOCK
                                                    HIGH        LOW
<S>                                                <C>         <C>
1996:
  Second calendar quarter (through May 29,
   1996)                                           $12.000     $9.562
  First calendar quarter                            11.125      7.625
1995:
  Fourth calendar quarter                            9.250      5.750
  Third calendar quarter                             8.375      4.875
  Second calendar quarter                            4.875      3.375
  First calendar quarter                             3.750      2.500
1994:
  Fourth calendar quarter                            3.125      2.375
  Third calendar quarter                             3.000      2.000
  Second calendar quarter                            3.000      1.625
  First calendar quarter                             3.625      2.250
1993:
  Fourth calendar quarter                            2.875      1.875
  Third calendar quarter                             3.125      2.000
  Second calendar quarter                            4.500      3.000
  First calendar quarter                             4.875      3.625
</TABLE>

For a recent sale price for the Common Stock, see the cover page to this
Prospectus. As of April 30, 1996, the Common Stock was held of record by 560
persons.

                           SELECTED FINANCIAL DATA

The following selected financial data should be read in conjunction with
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" and the financial statements and notes thereto included elsewhere in
this Prospectus. The statement of operations data for the years ended July 31,
1993, 1994 and 1995 and the balance sheet data at July 31, 1994 and 1995 are
derived from, and are qualified by reference to, the audited financial
statements included elsewhere in this Prospectus and should be read in
conjunction with those financial statements and notes thereto. The statement of
operations data set forth below for the years ended July 31, 1991 and 1992 and
the balance sheet data as of July 31, 1991, 1992 and 1993 are derived from the
audited financial statements of the Company not included herein. The selected
financial data as of and for the nine months ended April 30, 1995 and 1996 have
been derived from unaudited consolidated financial statements of the Company
which, in the opinion of management, include all adjustments, consisting of
normal recurring adjustments, necessary for a fair presentation of such data.
The results of operations for the nine months ended April 30, 1996 are not
necessarily indicative of the results of operations to be expected for the
entire year ending July 31, 1996.

<TABLE>
<CAPTION>

                                                                                                                   
                                                                YEAR ENDED JULY 31,                                
                                      1991             1992             1993             1994             1995     
<S>                               <C>              <C>              <C>              <C>              <C>          
STATEMENT OF OPERATIONS DATA:
 Net sales                        $     3,030      $    77,615      $   137,982      $         0      $         0  
 Manufacturing expenses(1)                966          169,587          147,755                0                0  
 Research and development           1,175,986        2,996,845        4,485,818        5,158,738        7,815,391  
 Sales and marketing(2)                     0                0                0                0                0  
 General and administrative           824,516        1,021,078        1,353,502        1,460,424        1,849,376  
 Net loss from continuing
  operations                       (1,892,420)      (4,054,919)      (5,915,558)      (7,675,743)      (9,643,351) 
 Gain on sale of discontinued
  operations                                0                0        3,207,120                0                0  
 Income (loss) from
  discontinued operations             125,817         (106,536)               0                0                0  
 Net loss                         $(1,766,603)     $(4,161,455)     $(2,708,438)     $(7,675,743)     $(9,643,351) 
 Net loss per share from
  continuing operations           $     (0.22)     $     (0.41)     $     (0.57)     $     (0.72)     $     (0.58) 
 Net income (loss) per share
  from discontinued
  operations                             0.01            (0.01)            0.31             0.00             0.00  
 Net loss per share(3)            $     (0.21)     $     (0.42)     $     (0.26)     $     (0.72)     $     (0.58) 
 Weighted average number of
  shares outstanding(3)             8,536,984        9,901,592       10,296,812       10,657,311       16,550,915  
</TABLE>

TABLE CONTINUED FROM ABOVE

                                                  NINE MONTHS       
                                                ENDED APRIL 30,     
                                            1995             1996   
STATEMENT OF OPERATIONS DATA:                                       
 Net sales                          $          0      $    874,959  
 Manufacturing expenses(1)                     0         2,278,242  
 Research and development              5,268,028         6,717,469  
 Sales and marketing(2)                   12,767           387,634  
 General and administrative            1,495,868         2,444,543  
 Net loss from continuing                                           
  operations                          (6,673,157)      (10,161,744) 
 Gain on sale of discontinued                                       
  operations                                   0                 0  
 Income (loss) from                                                 
  discontinued operations                      0                 0  
 Net loss                            $(6,673,157)     $(10,161,744) 
 Net loss per share from                                            
  continuing operations              $     (0.41)     $      (0.46) 
 Net income (loss) per share                                        
  from discontinued                                                 
  operations                                0.00              0.00  
 Net loss per share(3)               $     (0.41)     $      (0.46) 
 Weighted average number of                                         
  shares outstanding(3)               16,291,900        21,953,593  
                                    


<TABLE>
<CAPTION>
                                                                   JULY 31,                                  
                                      1991           1992           1993           1994            1995      
<S>                               <C>            <C>            <C>            <C>             <C>           
BALANCE SHEET DATA:
 Cash and cash equivalents        $ 1,185,759    $   927,620    $ 4,842,033    $  2,127,358    $  2,367,764  
 Short-term investments                     0              0              0               0               0  
 Working capital (deficit)          4,097,908      2,989,426      4,692,607      (1,175,384)      1,669,554  
 Total assets                       4,903,150      5,905,146      7,329,146       4,752,630       5,751,194  
 Long-term debt, less current                                                                                
  installments                        117,604         76,045      1,513,516       1,504,187       1,501,091  
 Accumulated deficit               (2,996,745)    (7,158,200)    (9,866,638)    (17,542,381)    (27,185,732) 
 Shareholders' equity                                                                                        
  (deficit)                         4,544,481      4,404,409      5,207,346        (596,320)      2,980,150  
                                                                                                                               
</TABLE>                                                          


TABLE CONTINUED FROM ABOVE


                                          APRIL 30, 1996           
                                     ACTUAL         AS ADJUSTED(4) 

BALANCE SHEET DATA:                                                
 Cash and cash equivalents        $ 14,789,510    $ 63,431,698     
 Short-term investments              7,328,201       7,328,201     
 Working capital (deficit)          22,953,009      71,595,197     
 Total assets                       30,572,968      79,215,156     
 Long-term debt, less current                                      
  installments                       1,500,000       1,500,000     
 Accumulated deficit               (37,347,476)    (37,347,476)    
 Shareholders' equity                                              
  (deficit)                         26,445,804      75,087,992     
                                


(1) The amounts reflected in manufacturing expenses for the years ended July 31,
    1991, 1992 and 1993 and the nine month periods ended April 30, 1995 and 1996
    reflect cost of goods sold for those periods.

(2) Sales and marketing for the years ended July 31, 1991 through 1995 is
    included in general and administrative.

(3) Computed on the basis described for net loss per share in Note 2 of Notes to
    Financial Statements.

(4) Adjusted to give effect to the sale of the Shares offered hereby at an
    assumed per share offering price of $10.375 and application of the
    estimated net proceeds therefrom. See "Use of Proceeds."

                   MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                FINANCIAL CONDITION AND RESULTS OF OPERATIONS

GENERAL

The Company's continuing operations consist of the research and development
efforts of its two divisions, the implantable cardioverter defibrillator group
and the catheter ablation group. These divisions are developing medical
devices to treat various types of arrhythmias (irregular heartbeats). The
operations conducted by these divisions were previously conducted by AngeMed,
Inc. and AngeLase, Inc., the Company's two greater-than-90% owned subsidiaries,
which were merged into the Company effective December 20, 1993. See Note 3 of
Notes to Financial Statements. In September of 1992, the Company completed the
sale of AMP, an accessory products business, to the B. Braun Cardiovascular
Division of Burron Medical Inc. The sale price consisted of $6.2 million in cash
at closing, plus a royalty of 10% and 5% of AMP product sales in fiscal 1993 and
1994, respectively. See Note 4 of Notes to Financial Statements. Effective
November 1, 1995, the Company also established a European subsidiary, Angeion
Europe Ltd. ("Angeion Europe"), to facilitate clinical trials of its ICDs and
expand its European business activities.

The Company has incurred net operating losses from continuing operations in each
year since its inception in 1986. At April 30, 1996, the Company's accumulated
deficit was $37,347,476. Losses have resulted principally from costs incurred in
the research and development of the Company's products. The Company has had
limited revenue since the sale of AMP in September 1992. The Company expects to
incur additional operating losses over the next several years as the Company
continues to fund research and development (including clinical trials) relating
to its ICDs and catheter ablation systems and invests in building its
manufacturing and marketing capabilities. The Company's ability to achieve
profitability is dependent in part on obtaining regulatory approvals for its
products and developing the capacity to manufacture and sell its products
successfully. There can be no assurance that the Company will obtain the
required regulatory approvals on a timely basis or at all, successfully develop,
commercialize, manufacture and market its products, or achieve profitability. In
addition, the Company's results of operations may fluctuate significantly from
quarter to quarter depending upon a number of factors, including the
availability of third party reimbursement, the timing of regulatory approvals,
progress of product development and clinical trials, the extent to which the
Company's products gain market acceptance, marketing and manufacturing costs and
competition.

Unless otherwise noted, the following discussion of financial condition and
results of operations relates only to the continuing operations of the Company.

RESULTS OF OPERATIONS
NINE MONTHS ENDED APRIL 30, 1995 COMPARED TO NINE MONTHS ENDED APRIL 30, 1996

Net sales increased from $0 in the nine months ended April 30, 1995 to $874,959
in the nine months ended April 30, 1996. The increase was due to the initiation
of sales of defibrillator products to Pacesetter and sales in connection with
European and U.S. clinical trials.

Manufacturing expenses increased from $0 in the nine months ended April 30, 1995
to $2,278,242 in the nine months ended April 30, 1996. The increase was due to
the cost of products sold during the period, as well as start-up costs
associated with the establishment of the Company's manufacturing capabilities.
Manufacturing costs were higher than net sales due to the low volume of net
sales relative to the significant costs incurred as the Company establishes its
manufacturing capabilities.

Research and development expenses increased from $5,268,028 in the nine months
ended April 30, 1995 to $6,717,469 in the nine months ended April 30, 1996. This
increase of $1,449,441 was primarily due to an acceleration of research and
development activity (including clinical trials) in connection with the
Company's ICD products. Research and development activity is currently focused
on the Company's ICD products, which accounted for $5,898,322 of the expenses
for the nine months ended April 30, 1996, while catheter ablation research and
development activities accounted for $819,147 of such expenses. The Company
expects that research and development expenses will continue to increase as the
Company expands human clinical trials, enhances current products and accelerates
the development of its new products.

Sales and marketing expenses increased from $12,767 in the nine months ended
April 30, 1995 to $387,634, in the nine months ended April 30, 1996 reflecting
the hiring of a sales and marketing Vice President and the initiation of
marketing activity.

General and administrative expenses increased from $1,495,868 in the nine months
ended April 30, 1995 to $2,444,543 in the nine months ended April 30, 1996. This
increase of $948,675 was due primarily to an increase in non-cash compensation
expenses resulting from the grant of stock and options and the start-up costs
associated with the establishment of the Company's European subsidiary.

The net loss for the nine months ended April 30, 1995 was $6,673,157, or $0.41
per share, compared to a net loss of $10,161,744, or $0.46 per share, for the
nine months ended April 30, 1996. 

YEAR ENDED JULY 31, 1994 COMPARED TO YEAR ENDED JULY 31, 1995

The Company did not have net sales or manufacturing expense in either fiscal
1994 or fiscal 1995.

Research and development expenses increased from $5,158,738 in fiscal 1994 to
$7,815,391 in fiscal 1995. This increase of $2,656,653 was due primarily to an
acceleration of research and development activity on the Company's ICDs.
Research and development activity relating to the Company's ICDs accounted for
$6,772,442 of the expenses for fiscal 1995, while catheter ablation research and
development activities accounted for $1,042,949 of the expenses. During fiscal
1994, there was an additional charge of $1,450,499 representing the purchase of
in-process research and development in connection with the mergers of AngeLase,
Inc. and AngeMed, Inc. into the Company. See Note 3 of Notes to Financial
Statements.

General and administrative expenses increased from $1,460,424 in fiscal 1994 to
$1,849,376 in fiscal 1995. This increase of $388,952 was primarily due to an
increase in payroll and legal expenses.

The net loss for fiscal 1994 was $7,675,743, or $0.72 per share, compared to
a net loss of $9,643,351, or $0.58 per share, for fiscal 1995.


YEAR ENDED JULY 31, 1993 COMPARED TO YEAR ENDED JULY 31, 1994

Net sales and cost of goods sold were $137,982 and $147,755, respectively, in
fiscal 1993. The Company had no sales or cost of goods sold in fiscal 1994. The
decrease was due to the termination of a contract with the Company's only OEM
customer.

Research and development expenses increased from $4,485,818 in fiscal 1993 to
$5,158,738 in fiscal 1994. This increase of $672,920 was due to an acceleration
of research and development activity relating to the Company's ICDs. Research
and development activity relating to the Company's ICDs accounted for $3,981,905
of the expenses for fiscal 1994, while catheter ablation development activities
accounted for $1,176,833 of the expenses. During fiscal 1994, there was an
additional charge of $1,450,499 representing the purchase of in-process research
and development in connection with the mergers of AngeLase, Inc. and AngeMed,
Inc. into the Company. See Note 3 of Notes to Financial Statements.

General and administrative expenses increased from $1,353,502 in fiscal 1993 to
$1,460,424 in fiscal 1994. This increase of $106,922 was due to an increase in
payroll and financing expenses.

The gain on sale of discontinued operations of $3,207,120 in fiscal 1993 was
attributable to the sale of AMP. See Note 4 of Notes to Financial Statements.

The net loss for fiscal 1993 was $2,708,438, or $0.26 per share, compared to a
net loss of $7,675,743, or $0.72 per share for fiscal 1994, which included the
gain on sale of discontinued operations.

LIQUIDITY AND CAPITAL RESOURCES

The Company's liquidity needs have related to, and are expected to continue to
relate to, the research and development activities of its ICD and catheter
ablation divisions, working capital and expenditure requirements of its
manufacturing operations, the acquisition of businesses, products and
technologies and expanded marketing expenditures. The Company has financed its
liquidity needs over the last three fiscal years through the sale of Common
Stock and other equity securities, issuance of long-term debt and notes payable
and the proceeds from the sale of AMP.

Net cash used in operating activities was $5,813,173 in the nine months ended
April 30, 1995 compared to $10,523,988 in the nine months ended April 30, 1996
and was $5,345,958, $5,151,520 and $8,566,889, in fiscal 1993, 1994 and 1995,
respectively. The cash used during these periods was primarily related to
research and development activities of the Company's ICD and catheter ablation
divisions (including clinical trials) and, during the nine months ended April
30, 1996, was also related to the build-up of inventory and the increase in
sales and marketing expenses as the Company began its initial manufacturing and
marketing activities.

The Company continues to expand its patent and trademark portfolio through
internal proprietary development and the acquisition of developed technologies.
The Company's investment in patents and trademarks for the nine months ended
April 30, 1996 totaled $322,023. The Company invested $523,185, $311,167 and
$337,158 in patents and trademarks in fiscal 1993, 1994 and 1995, respectively.
The Company will continue to invest in proprietary technologies and procedures
as warranted.

The Company's expenditures for fixed assets were $2,543,497 for the nine months
ended April 30, 1996, and were $430,234, $244,254 and $989,351 in fiscal 1993,
1994 and 1995, respectively. Fixed asset expenditures related primarily to
computer equipment, office furniture, production equipment for the ICD division
and research and development equipment. As the Company expands its ICD
production and catheter ablation research capabilities, fixed asset expenditures
are expected to increase.

At April 30, 1996, cash and cash equivalents was $14,789,510 and short-term
investments were $7,328,201. In August 1995, the Company completed a public
offering of 3.4 million shares of Common Stock that resulted in net proceeds of
$20,327,045. In September 1994, the Company completed a public offering of 4.9
million shares of Common Stock and 4.9 million warrants that resulted in net
proceeds of $10,599,122. In March 1996, an additional $11,630,337 in net
proceeds was received from the exercise of these warrants. In fiscal 1993, the
Company completed the sale of AMP and, in 1993, consummated the strategic
alliance with Pacesetter. See Notes 4, 6 and 8 of Notes to Financial Statements.

The Company may need additional financing following completion of this offering
depending on a number of factors, including: progress with clinical trials; time
and costs involved in obtaining regulatory approvals; costs involved in filing,
prosecuting and enforcing patents or defending against patent infringement
claims; competing technological and market developments; costs of manufacturing
and marketing scale-up; and potential acquisitions of businesses, products and
technologies. To the extent that additional financing is needed, however, there
can be no assurance that such additional financing would be available on
acceptable terms, if at all, and the failure to obtain any such additional
financing would have a material adverse effect on the Company.

The Company has net operating loss carryforwards for financial reporting and
federal income tax purposes of approximately $35,000,000, which can be used to
offset taxable income in future years. Future equity offerings combined with
sales of the Company's equity during the preceding years may cause changes in
ownership under Section 382 of the Internal Revenue Code of 1986, which would
limit the use of the Company's net operating loss carryforwards existing as of
the date of the ownership change. Given that the Company anticipates continued
losses during the next few years, it is not anticipated that any limitation
would have a material adverse effect on the Company.

For 1997, the Company is required to adopt Statement of Financial Accounting
Standards ("SFAS") No. 121, Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets to Be Disposed Of, and SFAS No. 123, Accounting for
Stock-Based Compensation. SFAS No. 121 prescribes accounting and reporting
standards when circumstances indicate that the carrying amount of an asset may
not be recoverable. Initial application of SFAS No. 121 is not expected to
result in recognition of a cumulative effect of a change in accounting principle
by the Company. SFAS No. 123 prescribes accounting and reporting standards for
all stock-based compensation plans. Since the Company intends to elect continued
recognition of certain stock-based compensation using the intrinsic value method
prescribed under Accounting Principles Board Opinion No. 25, Accounting for
Stock Issued to Employees, no material effect on the Company's expense
recognition is expected. However, for transactions with non-employees SFAS No.
123 requires the fair value based method for expense recognition. Currently, the
Company is unable to estimate the impact that will result from this method of
computing expense.

                                   BUSINESS

GENERAL

Angeion Corporation designs, develops and manufactures products that treat and
potentially cure irregular heartbeats (arrhythmias). The Company is developing
the SENTINEL series of implantable cardioverter defibrillators ("ICDs"), which
it believes are among the smallest and most technologically advanced ICDs in
clinical trials or market approved today. ICDs are designed to treat rapid
heartbeats in the ventricular (or lower) chambers of the heart, a condition
known as ventricular tachycardia ("VT"), and a severe form of VT known as
ventricular fibrillation ("VF"), which if not terminated will lead to sudden
cardiac death ("SCD"). ICDs are electronic devices that are implanted within the
body and are connected to the heart with defibrillator leads. These devices
monitor the patient's heartbeat and, in the event of VT/VF, deliver an
electrical shock to return the heartbeat to normal rhythm. Following receipt of
an Investigational Device Exemption ("IDE") from the U.S. Food and Drug
Administration ("FDA"), the Company commenced U.S. clinical trials of its first
SENTINEL model, the SENTINEL 2000, in March 1996. In April 1996, the Company
received CE Mark approval to market the SENTINEL 2000 in the European Union
("EU"). Based on its clinical trial progress to date, the Company believes that
it will submit its application for Pre-Market Approval ("PMA") for the SENTINEL
2000 and the SENTINEL 2010 series of products to the FDA in the first half of
calendar 1997.

The Company is also developing a radio frequency ("RF") catheter ablation system
that it believes will provide a potential cure for certain forms of atrial
arrhythmias (rapid heartbeats originating in the upper chambers of the heart)
and a laser catheter ablation system that it believes will provide a potential
cure for certain forms of VT. The Company has received an IDE from the FDA for
both its RF and laser catheter ablation systems and plans to expand human
clinical trials of both systems during the second half of calendar 1996.

BACKGROUND AND MARKETS

Arrhythmias (abnormal rhythms of the heart muscle) arise from numerous causes,
including congenital defects, tissue damage due to previous heart attacks or
atherosclerosis and certain other heart diseases. Arrhythmias originate in
either the atria (upper two chambers of the heart) where they are generally not
life-threatening, or the ventricles (the lower two chambers of the heart), where
they can significantly interfere with the pumping of oxygenated blood and can
therefore be life-threatening. VT occurs when the ventricles beat at an
abnormally rapid rate, depriving the ventricles of sufficient time to fill with
blood prior to each contraction and therefore reducing the amount of blood
pumped out of the heart. As a result, tissues and organs are deprived of the
oxygen carried by the blood, causing dizziness, unconsciousness, cardiac arrest
and possibly death.

Episodes of VT occur unpredictably and tend to become more serious over time. VT
can progress to the most serious type of cardiac arrhythmia, VF. In VF, the
heart's normal electrical impulses become disorganized and erratic. Unlike VT,
where the heart continues to contract in an organized fashion though at an
abnormally high rate, in VF the heart ceases to pump blood through the body. If
VF is not terminated quickly, the individual will experience an SCD episode
resulting in unconsciousness due to the heart's failure to pump oxygenated blood
to the body's tissues and organs. Without prompt medical intervention, the
individual typically will die.

Industry analysts estimate that in excess of 1.4 million people in the U.S. have
some form of VT and that more than 450,000 people in the U.S. die from SCD
episodes each year. It is estimated that approximately 50,000 to 70,000 people
survive SCD episodes each year, and approximately 125,000 to 150,000 people are
diagnosed each year with sustained chronic VT in the United States. Individuals
with sustained chronic VT are considered to have a very high risk of
experiencing an SCD episode. Current treatments for SCD survivors and sustained
chronic VT patients consist primarily of medication, ICDs and open heart
surgery. 

IMPLANTABLE CARDIOVERTER DEFIBRILLATORS

One of the most effective treatments for individuals at risk of experiencing
VT/VF is an ICD. An ICD is an electronic device that is implanted in the patient
and is connected to the heart with defibrillator leads. The ICD is designed to
monitor the patient's heartbeat and, in the event of VT or VF, to deliver
electric pulses or shocks that return the heartbeat to normal rhythm. Early ICD
devices were larger, requiring more invasive implantation and longer hospital
stays; delivered primarily high-energy shocks that were painful to the patient
and provided more energy than needed to treat the VT or VF; and had short life
spans, requiring replacement every two or three years.

The limitations of these early devices led to the development of more
sophisticated ICDs which are currently on the market and which are characterized
by: (i) reduced size and weight allowing for pectoral implant
capability; (ii) a biphasic waveform (an electrical shock of alternating
polarity); (iii) greater longevity; (iv) transvenous lead systems (allows
implantation of the lead through a vein so that open chest surgery is not
required); (v) electrogram storage capability (storage of intercardiac EKG);
(vi) tiered therapy (electrical shocks of varying intensity depending on the
type and severity of the arrhythmia); (vii) use of the ICD housing as an
electrode; and (viii) programmability (allows the physician to customize therapy
to the patient's condition both before and, more importantly, after implant).

The worldwide market for ICDs and defibrillator leads has grown from $160
million in 1990 to over $650 million in 1995, representing a compounded annual
growth rate in excess of 30%. This market is expected to continue to grow at an
annual rate of 20% to 25% to reach a worldwide market size of approximately $1.5
billion by the end of the decade. It is estimated that in 1995 over 25,000 ICDs
were implanted worldwide. The growth rate for this market is attributable to a
number of factors, including: (i) expansion of the indications for use of an
ICD; (ii) smaller devices allowing for less invasive and less costly surgical
procedures; (iii) disappointing performance of drug therapy compared with ICDs;
(iv) an increasing survival rate for SCD episodes; and (v) rapidly advancing ICD
technology.

These market estimates may be revised upward based upon the results of a recent
study known as the Multicenter Automatic Defibrillator Implantation Trial (the
"MADIT Study"). This five-year study evaluated the outcomes of high risk,
post-heart attack patients who were treated with drugs compared with those
post-heart attack patients implanted with an ICD. The MADIT study indicated that
patients implanted with an ICD had 54% fewer deaths than those who underwent
conventional drug therapies. The principal clinical investigator for the MADIT
Study estimates that an additional 80,000 people per year could benefit from an
ICD. This potential market size increase, however, may develop slowly until
referral patterns from cardiologists to electrophysiologists become more
established and may not be realized unless Medicare begins reimbursing for some
or all of the costs of a prophylactic implant of an ICD.

Recent developments in automated external defibrillators have the potential
to significantly increase the number of first responders with the capability
to treat victims of SCD. Because SCD causes more than 450,000 deaths annually
in the U.S., any increase in the survival rate of such victims may increase
the potential market for ICDs.

INTERVENTIONAL TECHNOLOGIES

Catheter ablation is an emerging therapeutic procedure that, in many cases,
offers the curative benefit of surgery but has the advantages of being a
minimally invasive procedure that exposes the patient to a lower risk of
complications or death, reduces hospitalization and is much less expensive than
open chest surgery. In catheter ablation procedures, a special
electrophysiological mapping catheter is guided through an artery or vein into
the patient's heart and to the site of the arrhythmogenic tissue (oxygen
deprived heart tissue and areas of scar tissue resulting from sustained VT which
conduct electrical impulses more slowly than normal tissue and increase the risk
of arrhythmia). The mapping catheter identifies the specific site(s) of
electrical malfunction. A catheter attached to an energy source is then used to
transmit energy from an external source into the arrhythmogenic tissue in an
amount sufficient to thermally damage the tissue. When the ablated tissue is
replaced with scar tissue, the pathway generating the conflicting electrical
impulse is eliminated and the normal conduction of electrical activity is
restored.

Although the market for catheter ablation devices in the treatment of
arrhythmias is much less defined and in an earlier stage of development than the
ICD market, the U.S. ablation market has grown from 1,500 procedures in 1990 to
over 55,000 procedures in 1995, representing a compounded annual growth rate in
excess of 100%. Industry sources project the cardiac ablation market could reach
250,000 procedures by the year 2000, which would equate to an approximately $300
million market. In addition, if cardiac ablation becomes an accepted treatment
for atrial fibrillation, the aggregate market for cardiac ablation could total
$1.0 billion by 2005.

The potential growth of the catheter ablation market depends upon the condition
to be treated. The use of catheters utilizing RF energy for the treatment of
supraventricular tachycardia ("SVT") is growing because atrial ablation sites
are easily accessible using current catheter technology and the RF energy is
able to penetrate the thinner tissue of the atria. The Company believes a more
significant market potential for laser catheter ablation devices, however, is in
the treatment of VT using laser catheter ablation. The market for VT laser
catheter ablation is supported by the same patient population for whom drug
therapy is not an acceptable treatment regimen. The following factors are
driving the growth of the overall ablation market: (i) catheter ablation offers
a potential cure for certain forms of arrhythmia rather than simply managing its
symptoms; (ii) catheter ablation is a cost-effective and minimally invasive
procedure; and (iii) advancements in electrophysiology mapping technology, known
as "global mapping," may allow for the treatment of VT through laser catheter
ablation.

STRATEGY AND FUNDAMENTAL STRENGTHS

The Company's business strategy is to build a full line of electrophysiology
products for the treatment and cure of cardiac arrhythmias. The Company is
focused on one area of cardiovascular disease, cardiac arrhythmias, and one
common practitioner, the electrophysiologist. The Company believes it
currently possesses the following fundamental strengths that will support its
efforts to achieve its strategy:


    INNOVATIVE TECHNOLOGIES

       The Company's research and development efforts have led to the
    introduction of numerous technological innovations for ICDs, including
    reduced size and weight, the use of dual batteries and proprietary design
    features to increase longevity and certain features providing for greater
    flexibility in treatment options. The Company has also made significant
    technological breakthroughs in its catheter ablation products. The Company's
    RF catheter ablation system's porous metal tip, which provides the ability
    to perfuse small amounts of water through the metal electrode tip, minimizes
    blood coagulation during ablation, allowing the delivery of larger amounts
    of power and energy to the cardiac tissue. The Company's laser catheter
    ablation system is the first catheter ablation system specifically designed
    for the treatment of VT. See "-- Products." 


       The Company has assembled a management, research and scientific team with
    considerable experience and expertise in the medical device industry. The
    Company's personnel and medical advisors have substantial experience in
    performing research, developing products, conducting clinical trials,
    obtaining regulatory approvals, manufacturing and marketing ICDs and other
    medical devices. In addition, the Company has developed relationships and
    works closely with leading medical researchers worldwide. See "Management."
    

    STRONG PATENT PORTFOLIO

       The Company has assembled what it believes to be a strong patent
    portfolio for both its ICD products and its catheter ablation products. As
    of May 15, 1996, the Company had 63 U.S. issued patents and 16 U.S.
    patents which have been allowed but have not yet issued, 36 U.S. patent
    applications pending, 27 foreign patent applications pending, and 22 U.S.
    patent applications in preparation with respect to its research and
    development products. See "-- Intellectual Property."

    PACESETTER STRATEGIC ALLIANCE

       In addition to establishing its own direct and indirect sales and
    marketing channels, the Company has a strategic alliance with Pacesetter,
    which has the second largest cardiovascular distribution network in the
    world. This alliance offers the Company timely access to the worldwide
    market and provides greater name recognition and resources. See "-- Sales
    and Marketing" and "-- Intellectual Property."

PRODUCTS

The Company's competitive product strategy is to maintain a broad product
pipeline driven by innovative technologies. The medical device industry,
particularly the ICD portion, is characterized by significant investment in new
technologies. In addition to research in cardiac electrophysiology, the Company
intends to invest significant resources in concurrent new product development
programs. For all products, there can be no assurance that the Company will be
able to meet its development schedules. 

IMPLANTABLE CARDIOVERTER DEFIBRILLATOR SYSTEM


The table below sets forth the Company's ICD products currently
market-approved, in clinical trials or under development:



<TABLE>
<CAPTION>
                                                                                        STATUS
     MODEL      SIZE/WT.    LONGEVITY(1)   CURRENT KEY FEATURE OBJECTIVES       U.S.               EUROPE
 
<S>           <C>             <C>         <C>                             <C>                  <C>

    2000      60cc/110gm      7 yrs.      *  Small size and weight              IDE;              CE Mark;
                                          *  Extended longevity           Clinical trials      Market approved
                                          *  Optimized biphasic waveform
                                          *  Dual battery system
                                          *  HOT CAN electrode system
- ---------------------------------------------------------------------------------------------------------------
 2010 Series
    2010      60cc/110gm      7 yrs.      *  Electrogram storage            Pre-clinical       Clinical trials
    2011      58cc/108gm                  *  Extended programmability
    2012      61cc/110gm                  *  Coupled shock fibrillation
- ---------------------------------------------------------------------------------------------------------------
2020 Series      TBA(2)       TBA(2)         TBA(2)                                 In development
- ---------------------------------------------------------------------------------------------------------------
2030 Series      TBD(3)       TBD(3)         TBD(3)                                 Planning stage
- ---------------------------------------------------------------------------------------------------------------
2100 Series      TBA(2)       TBA(2)      *  Smaller size and weight                In development
                                          *  Advanced waveform
                                          *  Pulse pretreatment
                                          *  Advanced anti-tachy pacing 
                                          *  Dual chamber pacing
                                          *  Atrial therapy

</TABLE>

(1) Based on one shock per quarter and 25% pacing.

(2) To be announced in the future.

(3) To be determined and announced in the future.


SENTINEL 2000.

The SENTINEL 2000 system consists of the SENTINEL model 2000 ICD, the ANGEFLEX
transvenous defibrillation lead system that connects the ICD to the patient's
heart, a specialized lap top computer programmer connected to a programming wand
(SMART WAND) and an external defibrillation test system.

The SENTINEL 2000 ICD is characterized by small size (60cc) and weight (110gm),
which allows for universal pectoral implantation. Pectoral implantation in
combination with transvenous leads eliminates the need for abdominal surgery and
thoracotomy (open chest surgery). Pectoral implantation reduces patient trauma,
recovery time, hospitalization costs and increases physician and patient
acceptance. Additionally, this product offers extended longevity through the use
of a dual battery system and other product design features. This product also
utilizes the Company's proprietary SMALL CAP TUNED biphasic waveform,
demonstrated in clinical trials to lower defibrillation thresholds. The SENTINEL
2000 features a programmable HOT CAN electrode system which uses the SENTINEL
2000 housing as an electrode that can be programmed on and off and programmable
shock configuration to add implant flexibility and further reduce defibrillation
thresholds.

In January 1995, the first fully functional model of the SENTINEL 2000 was
successfully implanted in human patients as part of a limited clinical trial in
Bonn, Germany. Follow-up evaluations of these initial patients has confirmed
that the SENTINEL 2000 is performing as anticipated. Additional implants have
taken place in the United Kingdom and Italy. In April 1996, the Company received
CE Mark approval for the SENTINEL 2000. The CE Mark is a worldwide standard
recognizing safety and quality assurance. This approval allows the Company to
begin marketing its SENTINEL 2000 model in all EU countries, subject to limited
regulations in certain countries. The Company is in the process of building
inventory for commercial introduction of the SENTINEL 2000 in the EU.

Following IDE approval, the Company initiated U.S. clinical trials of the
SENTINEL 2000 in March 1996. The IDE allows the Company to perform up to 60
implants in up to 15 centers nationwide. The Company will apply to supplement
its SENTINEL 2000 IDE to include the SENTINEL 2010 series, discussed below, as
part of its current clinical studies. Based on its clinical trial progress to
date, the Company believes that it will submit its PMA application for the
SENTINEL 2000 and the SENTINEL 2010 series to the FDA in the first half of
calendar 1997. See "-- Government Regulation." 

SENTINEL 2010 SERIES. The SENTINEL 2010 series consists of the 2010, 2011 and
2012 models and contains all of the features of the SENTINEL 2000 plus 5.5
minutes of electrogram storage capability and enhanced programming flexibility
for the electrophysiologist. These models also have a coupled shock fibrillation
feature, which provides for testing convenience for the electrophysiologist. The
difference between the models in the 2010 series relates to lead connector
configuration. The model 2010, like the model 2000, provides a universal
four-port connector for an additional subcutaneous electrode. The model 2011 is
two cubic centimeters smaller than the model 2010 because of its two port low
profile connector. The model 2012 four-port connector is compatible with
competitors' lead systems for replacement applications without the use of
adapters. The SENTINEL 2010 ICD was introduced into human clinical evaluation in
May 1996 in Europe. 

SENTINEL 2020 SERIES AND SENTINEL 2030 SERIES. The SENTINEL 2020 series and 2030
series will represent product line extensions of the SENTINEL 2000 and SENTINEL
2010 series and are under development to provide enhanced patient therapy. Both
series of products are scheduled to begin human implants in calendar 1997. 

2100 SERIES. The Company's 2100 series ICDs will be a new generation of ICDs,
designed to offer significant therapeutic enhancements and flexibility over the
prior SENTINEL series ICDs. The Company expects that the 2100 series will have
all of the features of the prior SENTINEL series ICDs, plus the following
additional features: (i) smaller size and weight, (ii) advanced lower
defibrillation energy waveform; (iii) pulse pretreatment therapy; (iv) advanced
anti-tachyarrhythmia pacing; (v) dual chamber pacing and sensing; and (vi)
atrial therapy. 

LEAD SYSTEMS. The Company has developed a transvenous lead system, the ANGEFLEX
model 4020 series, which is available in four lengths. This lead system has been
approved for commercial sale in Europe and approved for use as part of the U.S.
clinical trials.

The Company is currently testing an alternate OEM transvenous lead system for
use with the SENTINEL series. This lead system is intended to provide single
pass lead defibrillation, pacing and sensing for physicians preferring this
configuration. The Company anticipates filing for IDE approval for this product
by early calendar 1997. Concurrently, the Company is developing its own single
pass transvenous lead system, the ANGEPASS series, that will include pacing,
sensing and defibrillation functions. This lead is intended to incorporate the
technology of the ANGEFLEX series and will offer small size and flexibility in a
single pass configuration. Initial development and testing of this lead system
has commenced and pre-clinical trials are expected to begin in the first half of
calendar 1997. 

CATHETER ABLATION SYSTEMS

The Company's objective in the area of ablative arrhythmia management is to
develop a broad product base to serve the needs of the electrophysiologist. The
focus is directed both at atrial arrhythmias (SVT, atrial fibrillation and
atrial flutter) and ventricular arrhythmias (VT/VF). The Company is developing
four catheter-based systems for non-surgical percutaneous elimination of various
forms of cardiac arrhythmias: a cooled tip RF ablation catheter; a cooled RF
linear ablation catheter; a cooled laser ablation catheter; and a visual
ablation catheter. The Company is also developing catheter accessory products
that include a series of open lumen steerable guide/mapping catheters that can
be used in conjunction with both its RF and laser catheter ablation systems.

COOLED TIP RF ABLATION CATHETER SYSTEM. The Company's cooled tip RF ablation
catheter system consists of the Company's proprietary single use, disposable
catheter coupled to a standard RF generator and infusion pump. Additional
support devices are supplied by the hospital. The Company believes that its RF
catheter offers many features not offered by RF catheters currently in clinical
trials or market approved. The effectiveness of catheters that are currently in
clinical trials or market approved is somewhat limited by blood coagulation on
overheated catheter electrodes which requires removal, cleaning and reinsertion
of the catheter for continued use during the procedure. To address this problem,
the Company's RF catheter utilizes a patented porous metal electrode through
which saline is perfused during the ablation procedure. The saline irrigation
fluid both insulates the electrode from blood contact and cools the electrode
tip, thereby minimizing coagulum formation on the electrode while maximizing
lesion size.

The Company has completed preclinical studies with respect to the RF catheter
ablation system at Enders Pediatric Research Center in Boston. These studies
demonstrated the ability of the cooled tip RF catheter to produce larger lesions
in the atrium and ventricle without coagulum formation. The Company received IDE
approval in February 1996 to commence a feasibility study in human patients. The
IDE allows the Company to perform 20 procedures at four centers nationwide for
the treatment of SVT. The Company is currently investigating several clinical
sites and anticipates the commencement of clinical trials in the second half of
calendar 1996. 

COOLED RF LINEAR ABLATION CATHETER SYSTEM. The Company's cooled RF linear
ablation catheter is an extension of its cooled tip RF catheter ablation system.
The RF linear ablation catheter, currently under development, is intended for
use in atrial flutter and atrial fibrillation, where linear lesions are
considered a more effective therapy. Competitors' catheters use a series of ring
electrodes which are sequentially activated with RF energy. The Company's RF
linear ablation catheter will use a cooled metal electrode whose length is
adjustable. Using current RF generators, this catheter can form a linear lesion
with one application of energy, thereby reducing procedure time and enhancing
therapeutic effectiveness.

To date, the Company has constructed prototypes and demonstrated in engineering
studies the ability to make narrow linear lesions with the RF linear ablation
catheter. The Company intends to collaborate with a medical research institution
to complete development of this catheter. Based on its progress to date, the
Company anticipates filing an IDE for the treatment of atrial fibrillation with
the RF linear ablation catheter in the first half of calendar 1997. 

COOLED LASER ABLATION CATHETER SYSTEM. The Company's cooled laser catheter
ablation system is targeted at the VT market. Laser energy produces lesions of
the size and depth most likely to achieve consistently favorable results in the
ventricle with minimal trauma. The Company's proprietary technology uses a
two-piece construction consisting of an inner laser catheter for delivering
energy to the tissue and an outer steerable mapping catheter for identifying the
appropriate arrhythmogenic tissue. The inner catheter consists of a laser fiber
housed in a plastic tube that also contains irrigation channels, electrical
wires, and temperature instrumentation. The catheter is coupled to a laser
commonly used in urology and surgery. During delivery of laser light, saline is
perfused through the tip to prevent coagulation of blood and vaporization of
tissue. Temperature sensors in the laser catheter are embedded in the tissue to
safely deliver energy to cardiac tissue.

The Company's laser technology was developed in conjunction with the
experience of Dr. Robert Svenson, a Medical Advisor to the Company, at the
Carolinas Medical Center who has treated 60 VT patients in open chest procedures
over a six year period with favorable long term results. Currently, the Company
is conducting an IDE feasibility study to demonstrate the ability of the laser
catheter system to eliminate VT through a minimally invasive percutaneous
procedure. The Company's IDE for the feasibility study provides for the
treatment of 15 patients at two centers.

VISUAL ABLATION SYSTEM. The Company is developing a visually assisted laser
ablation system for certain cardiac therapies that may be anatomically guided.
This visually assisted laser ablation technology incorporates much of the
technology from the Company's current laser ablation system. The visual ablation
system technology integrates an imaging fiber bundle and an expandable balloon
into the Company's steerable mapping catheter. Once inside the heart, the
balloon is filled with saline to a diameter of several centimeters. The imaging
fiber is connected to an endoscopic viewing system to show the internal surfaces
of the heart. Once the appropriate anatomical structures are identified, a laser
fiber is positioned within the balloon to deliver energy to the interior surface
of the heart.

To date, the Company has performed several experiments to verify the ability of
this catheter to visualize the interior surfaces of the heart. After the Company
finalizes the design of this product, it will conduct the necessary studies to
file an IDE application with the FDA. 

CATHETER ABLATION ACCESSORY PRODUCTS. The Company plans to provide a broad line
of cathether ablation accessory products for the electrophysiologist. These
accessories may include introducers, fixed mapping catheters, steerable
guide/mapping catheters and extension wires. The Company anticipates that some
of these products will be developed as an extension of its ablation technologies
while others will be purchased from other companies on an OEM basis.

The Company has developed a series of open lumen, steerable guide/mapping
catheters that allow point mapping and accurate, flexible positioning of the
ablation catheter at the proper site. This steerable guide/mapping catheter can
be used with both the Company's RF and laser catheter ablation systems. The
steerable guide/mapping catheter has been studied in preclinical trials and has
been approved by the FDA for use in connection with the Company's laser catheter
human clinical trials. Early indications are that this steerable guide/mapping
catheter will allow a physician to position accurately the ablation catheter
within the ventricular chambers of the heart. 

FUTURE PRODUCTS. One of the barriers to increased utilization of ablation
therapies is the time required to perform the mapping necessary to define the
arrhythmogenic tissue. To be as successful as angioplasty, EP procedure times
must be reduced to minutes rather than hours. Such a reduction in procedure time
will be possible only with more sophisticated techniques for measuring
electrical patterns in the heart. Current point mapping systems require the
electrophysiologist to manipulate an electrode catheter inside the heart and
then develop a mental image from the electrical signals. It is anticipated that
procedure times will decrease if point mapping systems are replaced by
simultaneous mapping from many electrodes (global mapping), whose signals are
computer analyzed and displayed as a three dimensional graph. Such refined
global mapping technology has not yet been fully developed. The Company is
considering many alternatives in the global mapping area, including entering
into a strategic alliance with another company or research institution to
develop a global mapping system, or a direct investment in a technology or
business.

MANUFACTURING

The Company's manufacturing strategy is focused on the extensive use of proven
process vendors and the utilization of key component suppliers, with final
product assembly, testing, inspection and packaging at the Company's facilities.
The use of outside process vendors minimizes facility and equipment investment,
while providing access to resources that provide a high level of technical
ability with minimal production volume constraints. Key process vendors provide
laser welding, electronic assembly, sterilization, and other process
requirements. Component suppliers provide the Company with high quality
materials and the ability to increase production levels.

The Company currently manufactures its products at its 52,000 square foot U.S.
facility in Minneapolis, Minnesota where it employs 55 persons dedicated to
manufacturing. The Minneapolis facility recently received ISO 9002
certification, which certifies the quality management systems in all aspects of
its business, with a primary emphasis on manufacturing. In addition, the Company
has contracted with an ISO 9002 certified manufacturer in Scotland that will be
responsible for final assembly, testing, packaging, sterilization and labeling
of its ICDs and associated external products for the Company's international
sales and clinical trials. The Company's manufacturing facilities are required
to meet and adhere to all applicable requirements of U.S. and international
regulatory agencies, including Good Manufacturing Practice regulations and
Active Implantable Medical Device Directive ("AIMDD") standards. These
facilities are subject to periodic inspection and surveillance audits by both
U.S. and international regulatory agencies.

The manufacturing process for the Company's products consists primarily of
assembly of purchased components, testing and inspection operations, packaging
and sterilization. Components are purchased according to the Company's
specifications. A number of significant components, such as capacitors,
batteries, integrated circuits and lead systems, are purchased from sole source
suppliers. For certain of these components, there are relatively few sources of
supply, and establishing additional or replacement suppliers for such components
cannot be accomplished quickly. In addition, each supplier and each component
must be qualified with the FDA, and the time required for such qualification may
be lengthy. Although the Company tries to maintain sufficient quantities of
inventory of such components to minimize production delays or interruptions,
there can be no assurance that the Company will find suitable alternatives at
reasonable prices, if at all, or that any such alternatives will remain
available to the Company. The Company's inability to obtain acceptable
components in a timely manner or find and maintain suitable replacement
suppliers would have a material adverse effect on the Company's ability to
manufacture its products.

Pursuant to the OEM Agreement, if the Company fails to fulfill all product
quantity, quality and specification requirements with respect to the Company's
ICD and laser catheter ablation products under the OEM Agreement, Pacesetter may
elect to manufacture these products and pay the Company a royalty that is less
than the transfer price payment the Company would have received had it
manufactured the products and sold them to Pacesetter. Even if the Company has
fulfilled all product quantity, quality and specification requirements,
Pacesetter may elect to manufacture up to 50% of Pacesetter's aggregate product
requirements but will be required to pay to the Company a payment that equals
the net margin, as determined in the OEM Agreement, on the products had the
Company manufactured the products and sold them to Pacesetter. To date,
Pacesetter has not elected to manufacture any of the Company's products.

SALES AND MARKETING

The Company intends to market and sell its ICD and catheter ablation products on
a worldwide basis through three channels: (i) a direct Company sales force in
the United States; (ii) independent sales representatives and distributors
outside the United States; and (iii) its strategic alliance with Pacesetter. The
Company is currently preparing for the commercial introduction of the SENTINEL
2000 in Europe through its distributors and sales representatives.

The Company will directly market and sell its products under its own label
through its own sales force or through independent sales representatives or
distributors, provided that, under the OEM Agreement with Pacesetter, such
independent sales representatives or distributors may not also sell ICDs or
laser catheter products that are manufactured by other companies. In addition,
the Company may not market and sell products under its own label until it has
satisfied all of Pacesetter's quantity requirements for such products. The
Company has distributors in Italy, the United Kingdom, Belgium, Austria and
Holland, and direct sales representation in Germany. In December 1995, the
Company established its United Kingdom subsidiary, Angeion Europe, to facilitate
its clinical trials of the SENTINEL series of ICDs and expand its European sales
and distribution activities.

The Company will also sell its products through Pacesetter under the terms and
conditions of the OEM Agreement. Pursuant to this agreement, Pacesetter was
granted worldwide marketing and distribution rights on a co-exclusive basis with
the Company to the SENTINEL 2000, the SENTINEL 2010 series and all other ICD
products that are commercially marketed within two years of the first commercial
sales of the SENTINEL 2010 model ICD. Pacesetter has similar rights with respect
to laser catheter products that are commercially marketed within two years of
the first commercial sale of a laser catheter product. Pacesetter's co-exclusive
marketing period will continue for at least seven years from the date of the OEM
Agreement, and thereafter will be contingent upon certain defined minimum
product purchases by Pacesetter and its affiliates. Pacesetter's marketing
rights will continue on a non-exclusive basis in the event that the exclusive
period terminates. The Company believes that the worldwide OEM marketing
capability of Pacesetter will be of significant value in establishing a
worldwide market presence for the Company's products.

INTELLECTUAL PROPERTY

The Company believes strongly in protecting its intellectual property and
intends to undertake efforts to obtain patents, when available, in connection
with its research and product development programs. As of May 15, 1996, the
Company had 63 U.S. issued patents and 16 U.S. patents which have been allowed
but have not yet issued, relating to its research and development products, 36
U.S. patent applications pending, 27 foreign patent applications
pending, and 22 U.S. patent applications in preparation with respect to its
research and development products.

The Company's patented ICD features and technologies provide certain benefits,
including: (i) its dual battery system; (ii) a more efficient biphasic waveform
that lowers defibrillation energy thresholds; (iii) the HOT CAN electrode
system, which uses the SENTINEL housing as an electrode that can be programmed
on and off; and (iv) an energy delivery system that permits the ICD to increase
shock effectiveness by directing the current more uniformly throughout the
heart. In addition, the Company's RF catheter utilizes a patented porous metal
electrode through which saline is perfused during the ablation procedure, and
the Company's laser catheter utilizes a patented two-piece construction
consisting of an inner laser catheter for delivering energy to the tissue and an
outer steerable mapping catheter for identifying the appropriate arrhythmogenic
tissue. There can be no assurance, however, that any patents held by the Company
will be valid or otherwise of value to the Company or that any patent applied
for will be granted.

There has been substantial litigation regarding patent and other intellectual
property rights in the medical device industry, particularly in the ICD market.
To date, many patent and intellectual property disputes in the medical device
area have been settled through licensing or similar arrangements. In
contemplation of such an environment, the Company has developed a strategy of
expanding its patent portfolio in those areas where the Company believes
litigation is most likely to develop in the ICD market, and where the Company
has proven expertise, including defibrillation waveforms, electrode systems,
additional therapies, reduced size and increased device lifetime. While no
assurance can be given that the Company's strategy will be effective or that the
Company's patents in these areas are valid or will be of value in potential
negotiations with third parties, the Company continues to pursue patents in
those areas which it has identified as critical to ICD development.

The Company also relies on trade secrets and proprietary technology. The Company
typically requires its key technical employees and consultants to agree in
writing to keep its proprietary information confidential and, within certain
limitations, to assign all inventions relating to the Company's business to the
Company.

The Company acquired the technology for its continuous-wave laser catheter
system from Dr. Jeffrey Isner and Dr. Richard Clark in 1989. Pursuant to the
assignment agreement, the Company agreed to pay Dr. Isner and Dr. Clark a
royalty of 5% on sales of patented products incorporating this technology for
the life of any patent on this technology. Additionally, in exchange for Dr.
Robert Svenson's efforts in connection with the development of the laser
catheter ablation system, the Company has agreed to pay Dr. Svenson and
Carolinas Medical Center a royalty, when certain conditions are met, of 2% and
3%, respectively, on all paid sales of the Company's laser catheter ablation
products.

Pursuant to the License Agreement with Pacesetter, the Company and Pacesetter
have agreed to cross-license certain of their patents and patent applications.
Under this License Agreement, Pacesetter grants the Company certain
non-exclusive rights to certain patents and patent applications relating to
Pacesetter's ICD products as well as to manufacturing improvements made by
Pacesetter with respect to the Company's ICD products. With respect to the
Company's ICD products, the License Agreement divides the Company's patents and
patent applications into two categories: a first category for which the License
Agreement grants certain exclusive rights for a limited exclusive period, and a
second category for which the License Agreement grants certain non-exclusive
rights. The License Agreement also grants certain non-exclusive rights to the
Company's laser catheter patents and patent applications.

The License Agreement also grants Pacesetter a conditional right to sublicense
certain of the Company's ICD patents and patent applications in existence at the
time of the License Agreement (and certain continuation applications) to up to
three separate parties, provided that the Company receives the same
cross-license from the sublicensee as Pacesetter receives (or, if Pacesetter
also sublicenses 20 or more of its own patents or patent applications, that
Pacesetter uses its best efforts to secure such cross-license rights for the
Company). Pacesetter is under a pre-existing obligation, by virtue of a previous
license agreement with a major competitor, to license certain patent rights that
Pacesetter may acquire to such competitor, and the Company is aware that a
dispute has arisen between these parties with respect to the ability of
Pacesetter to receive royalties or negotiate cross-licenses with such competitor
in connection with the ICD patents and patent applications that are subject to
sublicensing under the License Agreement. Because the Company is not a party to
this dispute, the Company has no control over or knowledge of any potential
outcome of this dispute and is not necessarily bound by the outcome of this
dispute. Pacesetter has also recently initiated a lawsuit against CPI relating
to certain pacemaker and ICD patents. Although at this time the ICD patents and
patent applications of the Company that are subject to the License Agreement are
not at issue in this lawsuit, the Company has no control over whether such
patents and patent applications will become involved in such lawsuit or
any lawsuit, and the Company believes that it is likely that Pacesetter will at
some point involve such patents and patent applications in such lawsuit.

Because the License Agreement only requires Pacesetter to secure (or, in certain
circumstances, to use its best efforts to secure) for the Company the same
cross-license rights that it receives from third parties in connection with
sublicenses under the License Agreement, there can be no assurance that the
Company will receive necessary cross-licenses from third parties in exchange for
the grant of sublicenses to the ICD patents and patent applications that are
subject to the License Agreement. These ICD patents and patent applications,
however, represent less than one-half of the Company's current ICD patent
portfolio. As a result, even if the Company does not receive necessary
cross-licenses from third parties in connection with sublicenses under the
License Agreement, the Company believes that the balance of its patent portfolio
should be sufficient to enable the Company to independently negotiate
cross-licenses or otherwise settle intellectual property disputes with
competitors with respect to the Company's products. Nevertheless, any reduction
in the number of patents available to the Company in connection with any such
intellectual property disputes could affect the ability of the Company to
ultimately settle any such disputes on reasonable terms or at all, which could
have a material adverse effect on the Company.

The License Agreement also gives Pacesetter the right to enforce the first
category of patents during the limited exclusive period. The License Agreement
provides that the Company always has the right to sublicense all of its patents
and patent applications to third parties to avoid or settle a pending patent
infringement lawsuit, provided that during the limited exclusive period the
Company obtains for Pacesetter as part of any such settlement the same rights
and benefits received by the Company with respect to any patents that are
required or useful to Pacesetter in manufacturing and marketing the Company's
products.

RESEARCH AND DEVELOPMENT

Research and development expenditures for continuing operations were $4,485,818
, $5,158,738 and $7,815,391 in fiscal 1993, 1994 and 1995, respectively.
Research and development expenditures for the nine months ended April 30, 1996
were $6,717,469. The Company's research and development is primarily directed at
the development of its existing products and the clinical trials relating to
such products. Approximately 66.8%, 77.2% and 86.7% of the Company research and
development expenditures in fiscal 1993, 1994 and 1995, respectively, were
directly attributable to the SENTINEL ICD products. Approximately 87.8% of the
Company's research and development expenditures in the nine months ended April
30, 1996 was directly attributable to the SENTINEL series. The Company expects
that research and development expenses will continue to increase as the Company
expands human clinical trials and enhances current products while accelerating
the development of potential new products.

COMPETITION

IMPLANTABLE CARDIOVERTER DEFIBRILLATORS

Competition in the ICD market is intense and most of the Company's primary
competitors have substantially greater financial, manufacturing, marketing,
distribution and technical resources than those of the Company. While
antiarrhythmic drugs and cardiac ablation therapies (like the Company's laser
catheter ablation system) compete in this market, other manufacturers of ICD
devices have claimed a significant share of the market and are believed to be
the Company's primary competitors. Three companies, Medtronic, Inc.
("Medtronic"), CPI, a division of Guidant Corporation, and Ventritex, Inc.
("Ventritex"), currently have PMA-approved products in the ICD market and
control virtually all of that market today. In August 1985, the FDA approved
CPI's first commercial defibrillator to be marketed in the U.S. Medtronic was
the second company to receive FDA approval (February 1993), and Ventritex was
the third (April 1993).

The Company believes, based upon industry analyses and attendance by management
at industry meetings, that its SENTINEL series of ICDs are among the smallest
and most technologically advanced ICDs currently in clinical trials or
market-approved. Competitors of the Company, however, many of whom have greater
financial and technical resources than the Company, are developing and
conducting human clinical trials of ICDs with certain common features.

Any product developed by the Company that gains regulatory approval will have to
compete for market acceptance and market share. The timing of market
introduction of competitive products could adversely affect the competitiveness
of the Company's products. Accordingly, the relative speed with which the
Company can develop products, complete clinical testing and the regulatory
approval process and supply commercial quantities of the product to the market
are expected to be important competitive factors. The Company expects that
competition will also be based on device size and weight, longevity, ease of
programmability, ability to provide diagnostic capability, product reliability,
physician familiarity with the device, patent protection, sales and marketing
capability, third-party reimbursement policies, reputation and price.

CATHETER ABLATION

Although catheter ablation offers a potential cure for, rather than a treatment
of, SVT and VT, catheter ablation technologies must nonetheless compete with
drug therapy, open heart surgery and ICDs. While drug therapy has in the past
experienced limited effectiveness and adverse side effects, new drugs currently
under development may potentially offer improved treatment outcomes. Catheter
ablation does not currently compete, to a significant extent, with ICDs since
catheter ablation is currently used as a treatment for SVT rather than for VT.
As ablation products evolve and demonstrate efficacy in the treatment of VT, the
Company believes that ablation will increasingly compete with the ICD market.

Competition in the current catheter ablation market includes C.R. Bard, Inc.,
Cordis Corp. (a subsidiary of Johnson & Johnson), Boston Scientific Corporation,
Medtronic, EP Technologies, Inc., Cardiac Pathways, Electro Catheter Corporation
and St. Jude Medical (which purchased Daig Corp.). These companies are primarily
involved in the treatment of SVT with RF energy-based catheters. Although RF
catheters are not currently considered effective treatments relating to the
ventricle, certain companies are experimenting with the use of RF energy, as
well as other forms of energy, in the ventricle.

THIRD PARTY REIMBURSEMENT

The Company's ability to commercialize its products successfully will depend in
part on the extent to which reimbursement for the cost of such products and
related treatment will be available from government health administration
authorities, such as HCFA, which determines Medicare reimbursement levels,
private health insurers, health maintenance organizations and other third-party
payors. Payors are increasingly challenging the prices of medical products and
services.

In November 1995 the FDA and HCFA entered into an interagency agreement
establishing a process pursuant to which the FDA will place all IDEs that it
approves into one of two categories, "Category A" or "Category B." Category A
devices are considered experimental and for which the "absolute risk" of the
device type has not been established (i.e., initial questions of safety and
effectiveness have not been resolved for the device type) and will not be
eligible for Medicare reimbursement. Category B devices are considered
non-experimental or investigative devices where the incremental risk is the
primary risk in question (i.e., underlying questions of safety and effectiveness
of that device type have been resolved), or it is known that the device type can
be safe and effective because, for example, other manufacturers have obtained
FDA approval for that device type. A Category B device will be eligible for
Medicare reimbursement if it meets all other Medicare coverage requirements. The
SENTINEL 2000 ICD, and the RF and laser catheter ablation systems are Category B
devices and are currently being reimbursed by HCFA and third-party payors.

Even if the Company obtains a PMA on its products, some payors may deny coverage
until the procedure becomes generally accepted by the medical profession. There
can be no assurance that HCFA and third-party payors will continue to reimburse
any of the Company's products. The inability of hospitals and other providers to
obtain reimbursement from third-party payors for the Company's products would
have a material adverse effect on the Company. The Company expects that there
will be continued pressure on cost-containment throughout the United States
health care system. This pressure could adversely affect the prices of the
Company's products.

GOVERNMENT REGULATION

The Company's products are all classified as medical devices by the Food, Drug
and Cosmetic Act (the "FDC Act"), and as such, are subject to regulation and
supervision by the FDA, and to regulation by foreign governmental authorities.
These medical devices are also subject to ongoing controls and regulations under
the FDC Act, including registration by the manufacturer, compliance with
established manufacturing practices, device tracking, record-keeping,
advertising, packaging and compliance to standards. Comparable agencies in
certain states and foreign countries also regulate the Company's activities. The
Company's products are subject to recall at any time by the FDA or the Company
if it appears that use of the products could result in unwarranted health risks.

All medical devices intended for human use that are to be marketed in the United
States are placed into one of three regulatory classifications, depending on the
degree of regulatory control to which the device will be subject. Class III
devices, which include life support and life sustaining devices or implants, are
subject to the most stringent controls and require FDA approval prior to
marketing. The Company's ICD products and its catheter ablation systems are
classified as class III devices.

FDA requirements for both the Company's ICD and catheter ablation products
involve obtaining formal FDA premarket approval. The first stage of obtaining
formal FDA premarket approval is submission of an application for an IDE. The
IDE permits clinical evaluations of products on human subjects under controlled
experimental conditions by designated qualified medical institutions. To obtain
an IDE, approval of the investigational plan for the applicable system is
required from the institutional review board within each participating medical
institution as well as from the FDA. The Company has received IDE approval with
respect to its SENTINEL 2000 system and both the RF laser catheter ablation
systems.

The second stage of formal FDA premarket approval is the PMA application. The
PMA, which is submitted after clinical evaluations are completed under an IDE,
is a comprehensive report of all data and information obtained by the applicant
throughout the product's development and testing. The FDA will grant a PMA if it
finds that the safety and effectiveness of the product have been sufficiently
demonstrated and that the product complies with all applicable regulations and
standards. The FDA may require further clinical evaluation of the product,
terminate the clinical trials, grant premarket approval but restrict the number
of devices distributed, or require additional patient follow-up for an
indefinite period of time. There can be no assurance that the Company will be
successful in obtaining a PMA for any products, which is necessary to market
Company's products commercially in the U.S., in a timely manner, if at all.
Delays in obtaining marketing approvals and clearances in the U.S. could have a
material adverse effect on the Company.

The Company is required to and maintains detailed records relating both to its
maintenance of good manufacturing practices and to defective products and
complaints about its products. The FDA has authority to inspect the Company's
facilities to assure compliance with the FDC Act and regulations thereunder.

Many foreign countries have similar regulatory requirements concerning the
marketing of new medical devices. In January 1995, the AIMDD was fully
implemented in the EU. Under the AIMDD, the EU regulatory requirements are
expected to be more consistent. The time required to obtain approvals required
by foreign countries may be longer or shorter than that required for FDA
approval and requirements for licensing may differ from FDA requirements. The
Company is also subject to certain FDA regulations governing manufacturing
practices, packaging and labelling. Further, the FDA regulates the export of
medical devices that have not been approved or cleared for marketing in the
United States. Prior to commencement of sales outside the U.S., the Company will
be required either to obtain export approval from the FDA or to establish
manufacturing capacity abroad. The Company has received export approval under
FDA regulations that allows shipment of its products to the United Kingdom, and
has also contracted with a manufacturer in Scotland to manufacture its products
for use in Europe. See "-- Manufacturing."

Under the AIMDD, the Company is subject to "prior notice" of intent to conduct
clinical trials in the EU. This process, similar to the FDA IDE process,
requires regulatory documents and test information to be submitted to the
governmental agency of each country in which the Company intends to conduct
clinical trials. In order to commence commercial marketing of its products in
the EU, the Company is required to file for a CE Mark approval. In April 1996,
the Company received CE Mark approval for the SENTINEL 2000 from TUV Product
Service, an organization that certifies the safety of medical device products
and the quality assurance systems put in place by the manufacturer of the
medical device. There can be no assurance, however, that the Company will be
successful in obtaining CE Mark approval for any other products, in a timely
manner, if at all, which could have a material adverse effect on the Company.

EMPLOYEES

As of April 30, 1996, the Company had 153 full-time employees, including 17
engaged in administration, 55 in manufacturing, 69 in research and development,
and 12 in regulatory and clinical. There are no unions representing the
Company's employees. The Company believes that its relations with its employees
are good.

FACILITIES

The Company leases approximately 52,000 square feet of office and manufacturing
space in Minneapolis, Minnesota. This space serves as the Company's corporate
headquarters, as well as the research and development and manufacturing
facilities for the ICD and catheter ablation system programs. Rent payments
under the lease are approximately $502,000 per year, including shared real
estate taxes and operating expenses. The primary lease agreement extends through
December 31, 1997. The Company's current space may not be adequate to satisfy
the needs of the Company through the end of the lease. The Company believes,
however, it will be able to secure additional or alternative space at a
commercially reasonable price when needed.

                                  MANAGEMENT

DIRECTORS AND EXECUTIVE OFFICERS

The current directors and executive officers of the Company and their ages, as
of April 30, 1996, are as follows:

<TABLE>
<CAPTION>
            NAME               AGE                               TITLE
<S>                            <C>   <C>
Whitney A. McFarlin            55    Chairman of the Board, President and Chief Executive Officer

David L. Christofferson        58    Vice President, Chief Financial Officer and Secretary

Robert S. Garin                53    Vice President of Human Resources

Jennifer M. Marrone            40    Vice President of Regulatory and Clinical Affairs

Gary L. Payment                52    Vice President of Operations

T.V. Rao                       53    Vice President of Sales and Marketing

William J. Rissmann            46    Vice President of Engineering

Arnold A. Angeloni             53    Director

Dennis E. Evans                56    Director

Lyle D. Joyce, M.D., Ph.D.     49    Director

Joseph C. Kiser, M.D.          63    Director

Donald D. Maurer               59    Director

Glen Taylor                    55    Director
</TABLE>

WHITNEY A. MCFARLIN has been President, Chief Executive Officer and Chairman of
the Board of the Company since September 1993. From June 1990 to September 1993,
Mr. McFarlin was President, Chief Executive Officer, Chairman of the Board and a
founder of Clarus Medical Systems, Inc., a private medical device company
manufacturing products for the orthopedic surgical market ("Clarus"). Prior to
founding Clarus, Mr. McFarlin was President and Chief Executive Officer of
Everest & Jennings International, Ltd., a manufacturer of durable medical
equipment, from June 1985 to May 1990. From December 1977 to May 1985, Mr.
McFarlin was an officer of Medtronic, most recently as Executive Vice President,
where he was responsible for the U.S. pacing business. He serves on the Board of
Directors of several corporations, including Clarus and Zero Corp.

DAVID L. CHRISTOFFERSON joined the Company as Vice President and Chief Financial
Officer in January 1991. Mr. Christofferson was elected as the Company's
Secretary in April 1993, and was elected to the Board of Directors of Angeion
Europe in December 1995. From April 1988 to December 1990, he was a Division
Manager for Excel Office Products, a company he founded in 1986, which was
acquired in 1988 by General Office Products Company. From 1987 through 1989, he
was Chairman and Chief Financial Officer of Medical Wellness Technologies, Inc.,
a distributor of pain control devices. Prior to 1986, Mr. Christofferson was
employed by Medtronic for over 13 years in various management positions, most
recently as Director of Finance and Administration for the Drug Administration
Devices and Systems Division.

ROBERT S. GARIN joined the Company as Vice President of Human Resources in
January 1995. In December 1995, Mr. Garin was elected to the Board of Directors
of Angeion Europe. Prior to joining the Company, Mr. Garin served as a
management consultant to the Company. From 1985 through 1993, Mr. Garin was a
partner in Garin and Associates, a management and human resources consulting
firm. From 1971 to 1985, Mr. Garin was employed by Medtronic in various
positions including Director of Lead Operations and Director of Human Resources
for Latin American Manufacturing and Sales Operations.

JENNIFER M. MARRONE joined the Company in April 1995 as Vice President of
Regulatory and Clinical Affairs. From November 1993 to April 1995, Ms. Marrone
was Director of Regulatory, Clinical and Quality Assurance/Compliance at Empi,
Inc., a manufacturer of noninvasive biomedical devices. From 1979 to 1993, Ms.
Marrone served in a number of capacities at Medtronic including Manager of
Regulatory Affairs for the bradyarrhythmia and tachyarrhythmia products, where
she prepared and managed Medtronic's PMA applications for its tachyarrhythmia
management devices and transvenous leads. She joined Medtronic in 1979 as Study
Director in Preclinical Research.

GARY L. PAYMENT joined the Company in 1994 as Vice President of Operations. From
1985 to 1994, Mr. Payment held various positions at CPI, most recently as
Director of Manufacturing. Prior to joining CPI, Mr. Payment held several
positions at Medtronic, including Director of Operations, Manufacturing Program
Manager and Director of Quality Assurance.

T.V. RAO joined the Company in August 1995 as Vice President of Sales and
Marketing. In December 1995, Mr. Rao was elected Chairman of the Board of
Directors of Angeion Europe. From 1994 to 1995, Mr. Rao served as Vice President
of Sales and Marketing for Brunswick Biomedical Corporation, a medical device
company. From 1980 to 1994, Mr. Rao served in a number of capacities at
Medtronic, including Director of Product Management for the Tachyarrhythmia
Division, Director of International Marketing for pacing products, Product
Marketing Manager for tachyarrhythmia, and Manufacturing Engineering Manager for
the Energy Technology Division. From 1969 to 1980, Mr. Rao served in various
manufacturing engineering capabilities at Onan Corporation.

WILLIAM J. RISSMANN joined the Company in November 1994 as Vice President of
Engineering. Most recently, Mr. Rissmann was Director of Research and
Development in the Advanced Tachy Products division at CPI. From 1990 to
1994, he held several positions at CPI, including Director of Quality Control
and Test Engineering and Manager of Product Planning and Administration. Mr.
Rissmann also has prior experience at St. Jude Medical and Medtronic.

ARNOLD A. ANGELONI has been President of Gateway Alliance, LLC, a financial
consulting firm for start-up ventures and business consolidations, since early
1996. From 1961 to 1995, Mr. Angeloni was employed by Deluxe Corporation, a
provider of check products and services to the financial payments industry, in
various administrative, marketing, and operations positions, most recently as
Senior Vice President and President of the Business Systems Division. Mr.
Angeloni has been a director of the Company since 1990.

DENNIS E. EVANS has been President and Chief Executive Officer of Hanrow
Financial Group Ltd., a merchant banking partnership, since February 1989. He
also serves on the Board of Directors of Minnesota Power and Astrocom
Corporation. Mr. Evans has been a director of the Company since 1990.

LYLE D. JOYCE, M.D., PH.D. has been a cardiothoracic surgeon with the
Minneapolis Heart Institute for more than five years, and is currently the
President of Minnesota Thoracic Group, P.A. Dr. Joyce has been a director of
the Company since 1988.

JOSEPH C. KISER, M.D. was a cardiothoracic surgeon and is a founder of the
Minneapolis Heart Institute and the Minneapolis Heart Institute Foundation.
Dr. Kiser is also a founder of the Minnesota Thoracic Group, P.A. He
practiced cardiothoracic surgery at Abbott Northwestern Hospital as well as
other Minneapolis/St. Paul hospitals for more than 20 years prior to his
retirement in January 1995. Dr. Kiser has been a director of the Company
since 1988.

DONALD D. MAURER was named a director of the Company in January 1996. Mr.
Maurer currently serves as Chairman of the Board and Chief Scientific Officer
of Empi, Inc., a public company. Mr. Maurer founded Empi in 1977, became
Chairman of the Board in 1978, and was named President and Chief Executive
Officer in 1979. Mr. Maurer is also the Chairman of the Board of Medical
Alley, a Minneapolis professional organization representing the interests of
the medical industry.

GLEN TAYLOR has been the Chief Executive Officer and Chairman of the Board of
Taylor Corporation since 1975. Taylor Corporation employs more than 8,000
individuals throughout 60 operating divisions in 15 states, Canada, Europe,
Mexico and Australia. Taylor Corporation's businesses include printing, banking,
direct mail marketing, office supplies and electrical manufacturing. Mr. Taylor
also is the owner of the Minnesota Timberwolves, a National Basketball
Association franchise. From 1980 to 1990, Mr. Taylor served as a Minnesota State
Senator. Mr. Taylor has been a director of the Company since 1992.

MEDICAL ADVISORS

In addition to the Company's Board of Directors and full-time employees, the
Company maintains a number of Medical Advisors who possess knowledge and
experience in technical and medical areas related to the Company's products. The
Medical Advisors consult with management of the Company concerning the products
being developed and their use by health professionals. Listed below are the
Company's Medical Advisors:

<TABLE>
<CAPTION>
           NAME              SERVED SINCE                       CURRENT POSITION

<S>                          <C>           <C>

Robert G. Hauser, M.D.           1994      * Special Adviser to the Chairman and Chief Executive
                                             Officer of the Company.
                                           * President of, and a Cardiologist with, The
                                             Minneapolis Heart Institute (Minneapolis, MN).

Lyle D. Joyce, M.D., Ph.D.       1988      * President, Minnesota Thoracic Group, P.A.
                                           * Cardiothoracic surgeon with The Minneapolis Heart
                                             Institute  (Minneapolis, MN ).

Joseph C. Kiser, M.D.            1988      * Cardiothoracic surgeon (retired) with, and founder
                                             of, The Minneapolis Heart Institute and The
                                             Minneapolis Heart Institute Foundation.

Fabio Leonelli, M.D.             1992      * Assistant Professor of Medicine at the University of
                                             Kentucky.

J. Philip Saul, M.D.             1995      * Associate Professor of Pediatrics and Health
                                             Sciences and Technology at the Harvard Medical
                                             School.
                                           * Staff Pediatric Electrophysiologist at Children's
                                             Hospital (Boston, MA).
                                           * Director of the Cardiology Physiological
                                             Research Laboratories in the Department of
                                             Cardiology at Children's Hospital (Boston, MA ).

Robert H. Svenson, M.D.          1991      * Director of Laser and Applied Technologies
                                             Laboratory at the Carolinas Medical Center
                                             (Charlotte, NC).
                                           * Adjunct Professor of Medicine at the University of
                                             North Carolina.

Mark A. Wood, M.D.               1993      * Assistant Professor of Internal Medicine at the
                                             Medical College of Virginia.
                                           * Co-Director of Cardiac Electrophysiology
                                             Laboratories at the Medical College of Virginia
                                             and the McGuire Veterans Administration Medical
                                             Center (Richmond, VA).
</TABLE>



STAR TEAM

As a supplement to its Medical Advisors, in May of 1996, the Company established
its Strategic Tachyarrhythmia Advisory Resource Team (the "STAR Team"). The STAR
Team is made up of leading electrophysiologists, who are recognized as experts
in the use of biomedical devices for the management and treatment of cardiac
arrhythmias. The following is a brief summary of the STAR Team:

DAVID G. BENDITT, M.D. has served as a Medical Advisor to the Company since
1992. Dr. Benditt is a Professor of Medicine and Director of the Cardiac
Electrophysiology Laboratory and Arrhythmia Service at the University of
Minnesota Medical School in Minneapolis, Minnesota. Dr. Benditt is a past
president of the North American Society of Pacing and Electrophysiology
("NASPE") and the American Heart Association -- Minnesota Affiliate, and a
Fellow of the American College of Cardiology. Dr. Benditt serves on the
editorial boards of many peer reviewed journals including the AMERICAN JOURNAL
OF CARDIOLOGY and the JOURNAL OF CARDIOVASCULAR ELECTROPHYSIOLOGY.

FRANCIS E. MARCHLINSKI, M.D. is a Professor of Medicine, College of
Pennsylvania, Hahnemann University. Dr. Marchlinski is a member of NASPE and
a Fellow of the American College of Cardiology. Dr. Marchlinski serves on the
editorial boards of many peer reviewed journals including the AMERICAN
JOURNAL OF CARDIOLOGY, PACING AND CLINICAL ELECTROPHYSIOLOGY and the JOURNAL
OF CARDIOVASCULAR ELECTROPHYSIOLOGY.

SANJEEV SAKSENA, M.D. is a Clinical Associate Professor of Medicine and
Pediatrics -- NJ Medical School, and a Director of Arrhythmia & Pacemaker
Services, Eastern Heart Institute in Passaic, NJ. Dr. Saksena is the
Scientific Chair and President-Elect for NASPE and a Fellow of the American
College of Cardiology. Dr. Saksena serves on the editorial boards of many
peer reviewed journals including the AMERICAN JOURNAL OF CARDIOLOGY, PACING
AND CLINICAL ELECTROPHYSIOLOGY, AMERICAN HEART JOURNAL and the JOURNAL OF
CARDIOVASCULAR ELECTROPHYSIOLOGY. Dr. Saksena is also the Chairman of the
Government Relations Committee of NASPE and a member of the AVID clinical
trial planning and steering committee of the National Institute of Health.

JOHN F. SWARTZ III, M.D. is the Director, Cardiac Electrophysiology, St.
Francis Medical Center in Tulsa, OK. Dr. Swartz represents the private
practice customers of the electrophysiology community for Angeion. Dr. Swartz
is a member of the American College of Cardiology, and the American Heart
Association. Dr. Swartz is a reviewer for peer reviewed journals including
CIRCULATION, JOURNAL OF AMERICAN COLLEGE OF CARDIOLOGY and AMERICAN JOURNAL
OF CARDIOLOGY.

PATRICK J. TCHOU, M.D. has served as a Medical Advisor to the Company since
1991. Dr. Tchou is the Director of the Cardiac Electrophysiology Laboratory
at the Cleveland Clinic in Cleveland, Ohio, and is a Professor, Department of
Internal Medicine at the Ohio State University. Dr. Tchou is a member of
NASPE and a Fellow of the American College of Cardiology. Dr. Tchou reviews
manuscripts for such journals as CIRCULATION, JOURNAL OF AMERICAN COLLEGE OF
CARDIOLOGY, PACING AND CARDIAC ELECTROPHYSIOLOGY and the JOURNAL OF
CARDIOVASCULAR ELECTROPHYSIOLOGY.

                    PRINCIPAL SHAREHOLDERS AND BENEFICIAL
                           OWNERSHIP OF MANAGEMENT

The following table sets forth information regarding the beneficial ownership of
the Common Stock of the Company as of April 30, 1996, unless otherwise noted by,
(i) Pacesetter, (ii) each director and current executive officer, and (iii) all
executive officers and directors of the Company as a group. To its knowledge,
the Company has no beneficial owner of more than 5% of the outstanding Common
Stock. Unless otherwise noted, all of the shares shown are held by individuals
or entities possessing sole voting and investment power with respect to such
shares.

<TABLE>
<CAPTION>
                                                SHARES OF COMMON STOCK
                                                  BENEFICIALLY OWNED(1)
                                                                PERCENT OF CLASS
                NAME                      AMOUNT        BEFORE OFFERING   AFTER OFFERING
<S>                                      <C>            <C>               <C>
Pacesetter, Inc.                         1,125,000 (2)        4.4%             3.7%
 15900 Valley View Court
 P.O. Box 9221
 Sylmar, California 91392

Whitney A. McFarlin                        358,110(3)         1.5              1.2

David L. Christofferson                    145,047(4)          *                *

Robert S. Garin                             10,750(5)          *                *

Jennifer M. Marrone                         10,000(6)          *                *

Gary L. Payment                             28,530(7)          *                *

T.V. Rao                                         0              0                0

William J. Rissman                          16,250(8)          *                *

Arnold A. Angeloni                          71,902 (9)           *                *

Dennis E. Evans                            744,935 (10)       3.1              2.5

Lyle D. Joyce, M.D., Ph.D.                 279,435 (11)       1.2                 *

Joseph C. Kiser, M.D.                      377,836 (12)       1.6              1.3

Donald D. Maurer                                 0              0                0

Glen Taylor                                473,091 (13)       1.9              1.6

All current directors and
 executive
 officers as a group (13 persons)        2,515,886(14)       10.0              8.3
</TABLE>
 * Less than 1%.

 (1) Shares not outstanding but deemed beneficially owned by virtue of the right
     of a person or member of a group to acquire them within 60 days are treated
     as outstanding only when determining the amount and percent owned by such
     person or group. As of April 30, 1996, there were 24,212,207 shares of
     Common Stock outstanding.

 (2) As set forth in a Schedule 13D filed with the Securities and Exchange
     Commission on October 11, 1994, this amount consists of (i) 875,000 shares
     of Common Stock which may be acquired within 60 days upon the conversion of
     Series A Preferred Stock, and (ii) 250,000 shares of Common Stock which may
     be acquired within 60 days upon the conversion of a $1,500,000 convertible
     subordinated debenture.

 (3) Includes 355,156 shares which may be acquired within 60 days upon the
     exercise of options.

 (4) Includes 144,747 shares which may be acquired within 60 days upon the
     exercise of options.

 (5) Includes 8,750 shares which may be acquired within 60 days upon the
     exercise of options.

 (6) Consists of 10,000 shares which may be acquired within 60 days upon the
     exercise of options.

 (7) Includes 25,000 shares which may be acquired within 60 days upon the
     exercise of options.

 (8) Consists of 16,250 shares which may be acquired within 60 days upon the
     exercise of options.

 (9) Includes 45,000 shares which may be acquired within 60 days upon the
     exercise of options.

(10) Includes 610,000 shares beneficially owned by Hanrow Financial Group
     Ltd. ("Hanrow Financial"). Hanrow Financial is the general partner of
     Hanrow Capital Fund and Hanrow Capital Fund III, which own 30,000 and
     580,000 shares of Common Stock, respectively. Also includes 41,666
     shares which may be acquired within 60 days upon the exercise of
     warrants beneficially owned by Hanrow Financial, 41,667 shares which may
     be acquired within 60 days upon the exercise of warrants owned by Hanrow
     Business Finance, Inc., an affiliate of Hanrow Financial, and 21,000
     shares which may be acquired within 60 days upon the exercise of options
     held by Mr. Evans. Mr. Evans is the President and Chief Executive
     Officer of Hanrow Financial.

(11) Includes 91,000 shares held by the MTA Retirement Plan and Trust FBO Lyle
     D. Joyce, 7,500 shares which may be acquired within 60 days upon the
     exercise of warrants held by the MTA Retirement Plan and Trust FBO Lyle D.
     Joyce, 13,333 shares which may be acquired within 60 days upon the exercise
     of warrants and 39,000 shares which may be acquired within 60 days upon the
     exercise of options.

(12) Includes 43,567 shares held by the MTA Retirement Plan and Trust FBO Joseph
     C. Kiser and 80,833 shares which may be acquired by Dr. Kiser within 60
     days upon the exercise of stock options and warrants.

(13) Includes 200,000 shares which may be acquired within 60 days upon the
     exercise of warrants and 5,000 shares may be acquired within 60 days upon
     the exercise of options.

(14) Includes an aggregate of 1,054,902 shares which may be acquired within 60
     days upon the exercise of outstanding options and warrants beneficially
     owned by current directors and executive officers.

                          DESCRIPTION OF SECURITIES

The authorized capital stock of the Company consists of 35,000,000 shares of
Common Stock, par value $.01 per share, 1,475,000 shares of Preferred Stock,
Series A, par value $.01 per share (the "Series A Preferred"), 300,000 shares of
Preferred Stock, Series B, par value $.01 per share (the "Series B Junior
Preferred"), and 1,225,000 shares of Preferred Stock, par value $.01 per share,
the designation, rights and preferences of which have not been determined (the
"Undesignated Preferred").

COMMON STOCK

As of April 30, 1996, there were 24,212,207 shares of Common Stock issued and
outstanding, options outstanding to purchase a total of 2,515,066 shares of
Common Stock, and a debenture convertible into 250,000 shares of Common Stock.
All outstanding shares of Common Stock are fully paid and nonassessable.

The holders of the Common Stock are entitled to one vote for each share held of
record on all matters submitted to a vote of stockholders. Subject to the
preferential rights of the holders of the Undesignated Preferred with respect to
dividends, holders of the Common Stock are entitled to receive ratably such
dividends as may be declared by the Board of Directors out of funds legally
available therefor. Holders of the Common Stock have no preemptive rights and no
right to convert their Common Stock into any other securities.

SERIES A PREFERRED

As of April 30, 1996, there were 875,000 shares of Series A Preferred issued and
outstanding. Series A Preferred, at the option of the holder, may be converted
into Common Stock at the rate of one share of Common Stock for each share of
Series A Preferred, subject to certain antidilution adjustments. The holders of
the Series A Preferred are entitled to vote on any matter submitted to a vote of
the holders of the Common Stock of the Company as if the Series A Preferred had
been converted into Common Stock. All shares of Series A Preferred are entitled
to a liquidation preference in cash equal to $4.00 per share before the payment,
distribution or setting apart for payment or distribution of any amount for the
holders of the Common Stock. In addition, as long as shares of Series A
Preferred are outstanding in the event that dividends are declared on the Common
Stock of the Company, holders of the Series A Preferred shall be entitled to
receive an equivalent dividend on the basis of the number of shares of Common
Stock into which such holder's shares of Series A Preferred are then
convertible.

UNDESIGNATED PREFERRED

Under Minnesota law, no action by the Company's shareholders is necessary, and
only action by the Board of Directors is required, to authorize the issuance of
any of the undesignated shares of Undesignated Preferred. Subject to certain
limitations, the Board of Directors is empowered to establish, and to designate
the name of each class or series of the shares of Undesignated Preferred and to
set the terms of such shares (including terms with respect to redemption,
sinking fund, dividend, liquidation, preemptive, conversion and voting rights
and preferences). The Board of Directors can issue shares of such class or
series to, among other individuals, the holders of another class or series of
Undesignated Preferred or to the holders of the Common Stock. Accordingly, the
Board of Directors without shareholder approval can issue Undesignated Preferred
with voting or conversion rights which could adversely affect the voting power
of the holders of the Common Stock. The Undesignated Preferred may have the
effect of discouraging an attempt, through acquisition of a substantial number
of shares of the Common Stock, to acquire control of the Company with a view to
effecting a merger, sale or exchange of assets or a similar transaction.

WARRANTS

The Company has outstanding warrants to purchase an aggregate of 910,000 shares
of its Common Stock. The weighted average exercise price per share is $2.04.
Such warrants are exercisable at present and for periods of up to three years.
The Company is not able to determine whether or when any such warrants will be
exercised or what impact, if any, any such exercise might have on the price of
the Common Stock.

CERTAIN ANTI-TAKEOVER PROVISIONS

The Company is governed by the provisions of Sections 302A.671 and 302A.673 of
the Minnesota Business Corporation Act. These anti-takeover provisions could
potentially operate to deny shareholders the receipt of a premium on their
Common Stock and may also have a depressive effect on the market price of the
Company's Common Stock. Section 302A.671 generally provides that the shares of a
corporation acquired in a "control share acquisition" have no voting rights
unless voting rights are approved by the shareholders in a prescribed manner. A
"control share acquisition" is generally defined as an acquisition of beneficial
ownership of shares that would, when added to all other shares beneficially
owned by the acquiring person, entitle the acquiring person to have voting power
of 20% or more in the election of directors. Section 302A.673 prohibits a public
corporation from engaging in a "business combination" with an "interested
shareholder" for a period of four years after the date of the transaction in
which the person became an interested shareholder, unless the business
combination is approved in a prescribed manner. A "business combination"
includes mergers, asset sales and other transactions. An "interested
shareholder" is a person who is the beneficial owner of 10% or more of the
corporation's voting stock. Reference is made to the detailed terms of Sections
302A.671 and 302A.673 of the Minnesota Business Corporation Act.

Furthermore, Section 3.5 of Article III of the Company's Restated Articles of
Incorporation provides that the affirmative vote of the holders of two-thirds of
the voting power of the shares entitled to vote is required for shareholder
approval of a plan of merger, exchange of securities, or transfer of assets, as
described in Section 302A.601 of the Minnesota Business Corporation Act.

SHAREHOLDERS' RIGHTS PLAN

The Company has in effect a Shareholders' Rights Plan (the "Rights Plan"),
pursuant to which each share of Common Stock now outstanding has, and each share
offered hereby or issued prior to a Distribution Date will have, attached to it
one Preferred Stock Purchase Right (a "Right") which entitles the holder thereof
to purchase from the Company one one-thousandth of a share of Series B Junior
Preferred Stock of the Company at a purchase price of $70.00, subject to
adjustment. Separate certificates evidencing Rights will not be issued and the
Rights will not be exercisable until the occurrence of a Distribution Date, as
described below. All Rights expire on April 7, 2006, unless earlier exercised or
redeemed.

A Distribution Date will occur upon the earlier of ten business days after (i) a
public announcement that a person or group (an "Acquiring Person") has acquired
beneficial ownership of 15% or more of the Company's Common Stock, (ii) the
commencement of a tender offer or exchange offer that would result in a person
or group beneficially owning 15% or more of the Common Stock, or (iii) a
majority of the members of the Board who are unaffiliated with an Acquiring
Person or Adverse Person (as defined below) determines that any person or group
is an Adverse Person. Pursuant to the Rights Plan, the Board may make an Adverse
Person determination if it finds that a holder of at least 10% of the Company's
outstanding shares (i) acquired such shares either to cause the Company to
repurchase the shares or to enter into a transaction intended to provide such
person with short-term financial gain under circumstances that are not in the
best long-term interests of the Company's shareholders, or (ii) is causing or is
reasonably likely to cause a material adverse impact on the business or
prospects of the Company.

If a merger of the Company into an Acquiring Person occurs, any person acquires
beneficial ownership of 15% or more of the Company's Common Stock (except
pursuant to an offer for 100% of the shares approved by a majority of the
independent directors of the Company) or certain defined self-dealing events
between the Company and an Acquiring Person occur, each Right automatically
adjusts to permit the holder thereof to purchase that number of shares of Common
Stock which at the time of such transaction would have a market value of two
times the exercise price of the Right. However, Rights are not exercisable
following the occurrence of any of the events set forth above until the Rights
are no longer redeemable by the Company. Notwithstanding any of the foregoing,
all Rights that are, or (under certain circumstances) were, beneficially owned
by any Acquiring Person become null and void. The Company has the option, if the
Rights become exercisable, to exchange one share of Common Stock, or substitute
consideration consisting of cash, securities of the Company or other assets, for
each Right, except the void Rights.

At any time prior to the earlier to occur of (i) a person becoming an Acquiring
Person or (ii) the expiration of the Rights, the Company may redeem the Rights
in whole at a price of $.005 per Right (payable in cash or stock).

Any of the provisions of the Rights Plan may be amended, without the vote of
Rights holders, by the Board of Directors prior to the Distribution Date. After
the Distribution Date, certain limitations apply to the ability of the Board to
amend the Rights Plan.

The Rights Plan may have an anti-takeover effect in that any person or group
acquiring control of the Company without the consent of the Company's Board of
Directors could suffer substantial dilution through operation of the Rights
Plan.

REGISTRATION RIGHTS

Under the terms of various warrant agreements, the Company has granted certain
demand and "piggyback" registration rights covering the possible disposition of
up to 1,269,849 shares issued or issuable upon the exercise of such warrants.
The warrants containing such registration rights are exercisable at present. In
addition, pursuant to the Purchase Agreement, Pacesetter has certain demand and
"piggyback" registration rights covering the possible disposition of up to
1,125,000 shares of Common Stock issuable upon conversion of preferred stock and
convertible debenture. The Company filed a Registration Statement on Form S-3
registering the resale of all of the foregoing 2,394,849 shares on April 30,
1996, which Registration Statement is expected to be declared effective prior to
the commencement of this offering.

                                 UNDERWRITING

The Underwriters named below, acting through their representatives, Raymond
James & Associates, Inc., NatWest Securities Limited and Salomon Brothers Inc
(the "Representatives"), have severally agreed, subject to the terms and
conditions of the Underwriting Agreement, to purchase an aggregate of 5,000,000
shares of Common Stock from the Company at the Price to Public set forth on the
cover page of this Prospectus, less the underwriting discounts and commissions,
in the amounts set forth opposite their respective names below.

<TABLE>
<CAPTION>
                                     NUMBER
UNDERWRITER                         OF SHARES
<S>                                 <C>
Raymond James & Associates, Inc
NatWest Securities Limited
Salomon Brothers Inc

  Total                             5,000,000
</TABLE>

The nature of the Underwriters' obligations under the Underwriting Agreement is
such that all shares of the Common Stock offered hereby, excluding shares
covered by the over-allotment option granted to the Underwriters, must be
purchased if any are purchased. The Company has been advised by the
Representatives that the Underwriters propose to offer the shares of Common
Stock to the public initially at the Price to Public set forth on the cover page
of this Prospectus, and to certain dealers at such price less a concession not
in excess of $ per share. The Underwriters may allow, and such dealers may
reallow, a concession not in excess of $ per share to other dealers. The Price
to Public and concessions and reallowances to dealers may be changed by the
Representatives.

The Company has granted to the Underwriters an option, exercisable within 30
days of the date of this Prospectus, to purchase up to 750,000 additional shares
of the Common Stock solely to cover over-allotments, if any, at the same price
per share to be paid by the Underwriters for the other shares of Common Stock
offered hereby. If the Underwriters purchase any such additional shares pursuant
to the over-allotment option, each of the Underwriters will be committed to
purchase such additional shares in approximately the same proportion as set
forth in the above table. The Underwriters may purchase such shares only to
cover over-allotments, if any, in connection with the offering made hereby.

The Company and each of its officers and directors and certain of their
affiliates have agreed not to offer, sell, contract to sell, or otherwise
dispose of any shares of Common Stock of the Company, or securities convertible
into or exercisable for shares of Common Stock of the Company, without the prior
consent of Raymond James & Associates, Inc., during the period beginning on June
1, 1996 and ending 90 days from the effective date of the Registration
Statement, inclusive. This restriction does not apply to shares of Common Stock
issued by the Company pursuant to the conversion or exercise of stock options,
warrants, convertible preferred stock or convertible debentures outstanding on
the effective date of the registration statement.

In connection with this offering, the Underwriters may engage in passive market
making transactions in the Common Stock on the Nasdaq National Market
immediately prior to the commencement of sales in this offering, in accordance
with Rule 10b-6A under Securities and the Exchange Act of 1934, as amended (the
"Exchange Act"). Passive market making consists of displaying bids on the Nasdaq
National Market limited by the bid prices of independent market makers and
purchases limited by such prices. Net purchases by a passive market maker on
each day are limited to a specified percentage of the passive market maker's
average daily trading volume in the Common Stock during a specified prior period
and must be discontinued when such limit is reached. Passive market making may
stabilize the market price of the Common Stock at a level above that which might
otherwise prevail and, if commenced, may be discontinued at any time.

The Company and the Underwriters have agreed to indemnify each other against
certain liabilities, including certain liabilities under the Securities Act.
Such indemnification is limited or unavailable in certain circumstances,
including where legally unavailable.

NatWest Securities Limited, a United Kingdom broker-dealer and a member of the
Securities and Futures Authority Limited, has agreed that, as part of the
distribution of the shares of Common Stock offered hereby and subject to certain
exceptions, it will not offer or sell any shares of Common Stock within the
United States, its territories or possessions or to persons who are citizens
thereof or residents therein. The Underwriting Agreement does not limit the sale
of the shares of Common Stock offered hereby outside of the United States.

NatWest Securities Limited has also represented and agreed that (i) it has not
offered or sold and will not offer or sell any Common Stock to persons in the
United Kingdom prior to admission of the Common Stock to listing in accordance
with Part IV of the Financial Services Act 1986 (the "Act") except to persons
whose ordinary activities involve them in acquiring, managing, holding or
disposing of investments (as principal or agent) for the purpose of their
businesses or otherwise in circumstances which have not resulted and will not
result in an offer to the public in the United Kingdom within the meaning of the
Public Offers of Securities Regulations 1995 or the Act; (ii) it has complied
and will comply with all applicable provisions of the Act with respect to
anything done by it in relation to the Common Stock in, from or otherwise
involving the United Kingdom; and (iii) it has only issued or passed on and will
only issue or pass on, in the United Kingdom any document received by it in
connection with the issue of the Common Stock, other than any document which
consists of or any part of listing particulars, supplementary listing
particulars or any other document or instrument required or permitted to be
published by listing rules under Part IV of the Act, to a person who is of a
kind described in Article 11(3) of the Financial Services Act 1986 (Investment
Advertisements) (Exemptions) Order 1995 or is a person to whom the document may
otherwise be lawfully issued or passed on.

The Company has agreed that, until August 1998, Raymond James & Associates, Inc.
shall have a right of first refusal to act as lead manager or agent in
connection with any proposed offering of securities by the Company or by any
affiliates thereof, including this offering, to act as the investment banker to
the Company in connection with any merger, acquisition or consolidation
involving the Company or any affiliate, and to serve as the investment banker to
the Company in connection with any other transaction with respect to which the
Company proposes to engage an investment banker. If Raymond James & Associates,
Inc. agrees to render its assistance for any such transaction, it shall be for
fees and expenses competitive with those that would likely be charged by
comparable investment banking firms. As of April 30, 1996, Raymond James &
Associates, Inc. owned of record 359,850 shares of Common Stock of the Company.
On April 30, 1996, the Company filed a registration statement on Form S-3
registering for resale all of such shares, which registration statement is
expected to become effective prior to the commencement of this offering.

                                LEGAL MATTERS

Certain legal matters with respect to the validity of the shares of Common Stock
offered hereby will be passed upon for the Company by Oppenheimer Wolff &
Donnelly, Minneapolis, Minnesota. Certain legal matters will be passed upon for
the Underwriters by Hale and Dorr, Boston, Massachusetts.

                                   EXPERTS

The financial statements of Angeion Corporation as of July 31, 1994 and 1995,
and for each of the years in the three-year period ended July 31, 1995, included
and incorporated herein and in the registration statement by reference, have
been so included and incorporated herein by reference in reliance upon the
report of KPMG Peat Marwick LLP, independent certified public accountants,
included and incorporated by reference herein, and upon the authority of said
firm as experts in accounting and auditing.

The statements in the Prospectus under the captions "Risk Factors --
Intellectual Property Protection" and "Business -- Intellectual Property" and
other references herein to intellectual property-related matters have been
reviewed and approved by Patterson & Keough, P.A., patent counsel to the
Company, as experts on such matters, and are included herein in reliance upon
that review and approval.

                            AVAILABLE INFORMATION

The Company is subject to the informational requirements of the Exchange Act
and, in accordance therewith, files reports, proxy statements and other
information with the Securities and Exchange Commission (the "Commission"). Such
reports, proxy statements and other information can be inspected and copied at
the Public Reference Section of the Commission at Room 1024, 450 Fifth Street,
N.W., Washington, D.C. 20549, and at the following Regional Offices of the
Commission: New York Regional Office, 7 World Trade Center, 13th Floor, New
York, New York 10048; and Chicago Regional Office, Citicorp Center, Suite 1400,
500 West Madison Street, Chicago, Illinois 60661. Copies of such material can
also be obtained at prescribed rates by writing to the Public Reference Section
of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549.

The Company has filed with the Commission a Registration Statement on Form S-3
under the Securities Act. This Prospectus does not contain all of the
information, exhibits and undertakings set forth in the Registration Statement,
certain portions of which are omitted as permitted by the Rules and Regulations
of the Commission. Copies of the Registration Statement and the exhibits are on
file with the Commission and may be obtained, upon payment of the fee prescribed
by the Commission, or may be examined, without charge, at the offices of the
Commission set forth above. For further information, reference is made to the
Registration Statement and its exhibits.

               INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

The following documents filed with the Commission by the Company (File No.
0-17019) are incorporated into this Prospectus by reference: (a) Annual Report
on Form 10-K for the year ended July 31, 1995; (b) Quarterly Reports on Form
10-Q for the quarters ended October 31, 1995, January 31, 1996 and April 30,
1996; (c) Current Report on Form 8-K, dated October 31, 1995; (d) Current Report
on Form 8-K, dated April 8, 1996, as amended on May 17, 1996; (e) all other
reports filed by the Company pursuant to Sections 13(a) or 15(d) of the Exchange
Act since July 31, 1995; (f) the description of the Company's Common Stock
contained in its Registration Statement on Form 8-A and any amendments or
reports filed for the purpose of updating such description; and (g) the
description of the Company's Series B Junior Preferred Stock and rights to
purchase Series B Junior Preferred Stock contained in its Registration Statement
on Form 8-A and any amendments or reports filed for the purpose of updating such
description.

All documents filed by the Company with the Commission pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus
and prior to the termination of the offering of the Shares shall be deemed to be
incorporated by reference in this Prospectus and to be a part hereof from the
date of filing of such documents. Any statement incorporated or deemed to be
incorporated herein by reference shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any other subsequently filed document which also is or is deemed to be
incorporated herein by reference modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.

The Company will provide without charge to each person to whom a copy of this
Prospectus is delivered, upon written or oral request of such person, a copy of
any or all of the documents referred to above which are incorporated by
reference in this Prospectus, other than exhibits to such documents (unless such
exhibits are specifically incorporated by reference in such documents). Written
requests for such copies should be directed to Angeion Corporation, 3650
Annapolis Lane, Suite 170, Minneapolis, Minnesota 55447-5434, Attention: David
L. Christofferson, Chief Financial Officer; telephone number: (612) 550-9388.

INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
                                                                                        PAGE
<S>                                                                                     <C>
Independent Auditors' Report                                                             F-2

Balance Sheets as of July 31, 1994 and 1995                                              F-3

Statements of Operations for the Years Ended July 31, 1993, 1994 and 1995                F-4

Statements of Shareholders' Equity (Deficit) for the Years Ended July 31, 1993,
 1994 and 1995                                                                           F-5

Statements of Cash Flows for the Years Ended July 31, 1993, 1994 and 1995                F-6

Notes to Financial Statements                                                            F-7

Unaudited Consolidated Balance Sheet as of April 30, 1996                               F-12

Unaudited Consolidated Statements of Operations for the Nine Months Ended
 April 30, 1995 and 1996                                                                F-13

Unaudited Consolidated Statements of Cash Flows for the Nine Months Ended
 April 30, 1995 and 1996                                                                F-14

Notes to Unaudited Consolidated Financial Statements                                    F-15
</TABLE>


                         INDEPENDENT AUDITORS' REPORT

The Board of Directors and Shareholders
of Angeion Corporation:

We have audited the accompanying balance sheets of Angeion Corporation as of
July 31, 1994 and 1995, and the related statements of operations, shareholders'
equity (deficit), and cash flows for each of the years in the three-year period
ended July 31, 1995. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Angeion Corporation as of July
31, 1994 and 1995, and the results of its operations and its cash flows for each
of the years in the three-year period ended July 31, 1995, in conformity with
generally accepted accounting principles.

KPMG Peat Marwick LLP

Minneapolis, Minnesota
September 14, 1995

                             ANGEION CORPORATION
                                BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                         JULY 31,
                                                                   1994             1995
<S>                                                            <C>              <C>
                                            ASSETS
Current assets:
  Cash and cash equivalents                                    $  2,127,358     $  2,367,764
  Other receivable                                                   38,697                0
  Royalty receivable                                                144,978                0
  Inventories                                                       230,211          398,788
  Prepaid expenses and other current assets                         128,135          172,955
    Total current assets                                          2,669,379        2,939,507
Property and equipment, net                                         998,876        1,602,774
Patents and trademarks, net                                         905,875        1,055,229
Other assets                                                        178,500          153,684
    Total assets                                               $  4,752,630     $  5,751,194
                        LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
Current liabilities:
  Accounts payable                                             $    415,825     $    836,301
  Accrued payroll, vacation and related costs                       337,758          238,599
  Notes payable, net of discount of $167,000                      2,833,000                0
  Current installments of capital lease obligations                   9,328            2,599
  Other accrued expenses                                            248,852          192,454
    Total current liabilities                                     3,844,763        1,269,953
Long-term debt                                                    1,500,000        1,500,000
Capital lease obligations, less current installments                  4,187            1,091
    Total liabilities                                             5,348,950        2,771,044
Shareholders' equity (deficit):
  Convertible preferred stock, series A, $0.01 par value.
   Authorized 1,475,000 shares; issued and outstanding
   875,000 shares in 1994 and 1995                                3,166,425        3,166,425
  Common stock, $0.01 par value.
   Authorized 35,000,000 shares; issued and
   outstanding 11,152,935 shares in 1994 and 17,500,529
   shares in 1995                                                   111,529          175,005
  Additional paid-in capital                                     13,668,107       26,824,452
  Accumulated deficit                                           (17,542,381)     (27,185,732)
    Total shareholders' equity (deficit)                           (596,320)       2,980,150
Commitments (notes 10 and 13)
    Total liabilities and shareholders' equity (deficit)       $  4,752,630     $  5,751,194
</TABLE>

The accompanying notes are an integral part of the financial statements.

                             ANGEION CORPORATION
                            STATEMENTS OF OPERATIONS


<TABLE>
<CAPTION>
                                                              YEAR ENDED JULY 31,
                                                     1993             1994             1995
<S>                                              <C>              <C>              <C>
Net sales                                        $   137,982      $         0      $         0
Cost of goods sold                                   147,755                0                0
  Gross margin                                        (9,773)               0                0
Operating expenses:
  Research and development                         4,485,818        5,158,738        7,815,391
  General and administrative                       1,353,502        1,460,424        1,849,376
  Merger expense for in-process
   research and development                                0        1,450,499                0
    Total operating expenses                       5,839,320        8,069,661        9,664,767
  Operating loss from continuing operations       (5,849,093)      (8,069,661)      (9,664,767)
Other income (expense):
  Royalty income                                           0          482,853                0
  Interest income                                    115,852           72,250          292,578
  Interest expense                                   (76,019)        (161,185)        (271,162)
  Other expense                                     (106,298)               0                0
    Other income (expense)                           (66,465)         393,918           21,416
    Loss from continuing operations               (5,915,558)      (7,675,743)      (9,643,351)
Gain on sale of discontinued operations            3,207,120                0                0
    Net loss                                     $(2,708,438)     $(7,675,743)     $(9,643,351)
Net loss per share from continuing
 operations                                      $     (0.57)     $     (0.72)     $     (0.58)
Net income per share from
 discontinued operations                                0.31             0.00             0.00
    Net loss per share                           $     (0.26)     $     (0.72)     $     (0.58)
Weighted average number of shares
 outstanding                                      10,296,812       10,657,311       16,550,915
</TABLE>

The accompanying notes are an integral part of the financial statements.

                             ANGEION CORPORATION
                 STATEMENTS OF SHAREHOLDERS' EQUITY (DEFICIT)

<TABLE>
<CAPTION>
                                        CONVERTIBLE
                                      PREFERRED STOCK                COMMON STOCK          ADDITIONAL 
                                   NUMBER                        NUMBER                     PAID-IN      ACCUMULATED  
                                  OF SHARES     PAR VALUE      OF SHARES    PAR VALUE     CAPITAL        DEFICIT           TOTAL
<S>                               <C>           <C>            <C>          <C>         <C>           <C>             <C>
Balance at July 31, 1992                 0      $        0     10,230,434   $102,304    $11,460,305   $ (7,158,200)   $   4,404,409
 Shares issued at $4.00 per
  share, net of issuance
  costs                            875,000       3,166,425              0          0              0              0        3,166,425
 Stock options exercised                 0               0          8,093         81         28,675              0           28,756
 Director stock issued                   0               0         68,698        687        215,288              0          215,975
 Stock issued in settlement
  of litigation                          0               0         15,000        150         59,850              0           60,000
 Compensation expense on
  grant of options                       0               0              0          0         40,219              0           40,219
 Net loss                                0               0              0          0              0     (2,708,438)      (2,708,438)
Balance at July 31, 1993           875,000       3,166,425     10,322,225    103,222     11,804,337     (9,866,638)       5,207,346
 Stock issued in connection
  with merger of subsidiaries            0               0        663,610      6,636      1,443,863              0        1,450,499
 Stock options exercised                 0               0        115,530      1,155          4,222              0            5,377
 Director stock issued                   0               0         36,570        366         95,634              0           96,000
 Stock issued for
  consulting services                    0               0         15,000        150         52,350              0           52,500
 Compensation expense on
  grant of options                       0               0              0          0         67,301              0           67,301
 Issuance of common
  stock warrants                         0               0              0          0        200,400              0          200,400
 Net loss                                0               0              0          0              0     (7,675,743)      (7,675,743)
Balance at July 31, 1994           875,000       3,166,425     11,152,935    111,529     13,668,107    (17,542,381)        (596,320)
 Notes payable converted
  into common stock                      0               0        761,373      7,614      1,427,132              0        1,434,746
 Shares and warrants issued
  at $2.38 per share, net of
  issuance costs                         0               0      4,900,000     49,000     10,550,122              0       10,599,122
 Stock options exercised                 0               0        645,805      6,458      1,038,049              0        1,044,507
 Director stock issued                   0               0         40,416        404         95,596              0           96,000
 Compensation expense on
  grant of options                       0               0              0          0         45,446              0           45,446
 Net loss                                0               0              0          0              0     (9,643,351)      (9,643,351)
Balance at July 31, 1995           875,000      $3,166,425     17,500,529   $175,005    $26,824,452   $(27,185,732)   $   2,980,150
</TABLE>


The accompanying notes are an integral part of the financial statements.


                             ANGEION CORPORATION
                           STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                       YEAR ENDED JULY 31,
                                                              1993             1994             1995
<S>                                                       <C>              <C>              <C>
Operating activities:
  Net loss                                                $(2,708,438)     $(7,675,743)     $(9,643,351)
  Adjustments to reconcile net loss to net cash used
   in
   operating activities:
    Depreciation and amortization                             416,193          501,025          598,073
    Expense on grant of stock and stock options               316,194          215,801          141,446
    Notes payable discount amortization                             0           33,000          100,200
    Merger expense for in-process research and
     development                                                    0        1,450,499                0
    Gain on sale of discontinued operations                (3,207,120)               0                0
    Changes in operating assets and liabilities:
      Other receivable                                         (6,094)          (2,603)          38,697
      Trade accounts receivable                                77,615                0                0
      Royalty receivable                                     (217,756)          72,778          144,978
      Inventories                                             (81,954)         (90,452)        (168,577)
      Prepaid expenses and other current assets                53,633          (62,886)         (66,020)
      Accounts payable                                       (105,845)         101,903          366,776
      Accrued expenses                                        117,614          305,158          (79,111)
       Net cash used in operating activities               (5,345,958)      (5,151,520)      (8,566,889)
Investing activities:
  Payments for purchases of property and equipment           (430,234)        (244,254)        (989,351)
  Increase in other assets                                   (523,185)        (311,767)        (337,158)
      Net cash used in investing activities                  (953,419)        (556,021)      (1,326,509)
Financing activities:
  Proceeds from issuance of preferred stock, net            3,166,425                0                0
  Proceeds from issuance of convertible
   subordinated debentures                                  1,500,000                0                0
  Proceeds from sale of discontinued operations             6,409,315                0                0
  Proceeds from exercise of stock options                      28,756            5,377        1,044,507
  Proceeds from sale of stock warrants                              0          200,400                0
  Proceeds from issuance of common stock and
   warrants, net                                                    0                0       10,599,122
  Proceeds from issuance of notes payable                           0        2,800,000                0
  Repayments of debt                                         (890,706)         (12,911)      (1,509,825)
      Net cash provided by financing activities            10,213,790        2,992,866       10,133,804
  Net increase (decrease) in cash and cash equivalents      3,914,413       (2,714,675)         240,406
Cash and cash equivalents:
  Beginning of year                                           927,620        4,842,033        2,127,358
  End of year                                             $ 4,842,033      $ 2,127,358      $ 2,367,764
Supplemental disclosure of cash flow information:
  Cash paid during the year for interest                  $    22,310      $    59,115      $   240,031
</TABLE>

Supplemental disclosure of noncash investing and financing activities: During
  1993, 15,000 shares of common stock valued at $60,000 were issued in
settlement of litigation.
  During 1994, 15,000 shares of common stock valued at $52,500 were issued as
  compensation for consulting services.
    During 1995, $1,434,746 of notes payable were converted into common stock.

The accompanying notes are an integral part of the financial statements.

                             ANGEION CORPORATION
                        NOTES TO FINANCIAL STATEMENTS
                   Years Ended July 31, 1993, 1994 and 1995

 1.DESCRIPTION OF BUSINESS

Angeion Corporation ("Angeion" or the "Company") designs, develops and
manufactures products that treat and potentially cure arrhythmias.

 2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

INVENTORIES: Inventories are stated at the lower of cost (determined on a
first in, first out basis) or market. Inventories consist primarily of
material costs.

PROPERTY AND EQUIPMENT: Property and equipment are carried at cost. Equipment
and furniture and fixtures are depreciated using the straight-line method
over five to seven years. Leasehold improvements are depreciated using the
straight-line method over the lease term. Expenditures for repairs and
maintenance are charged to expense as incurred.

PATENTS AND TRADEMARKS: The costs incurred to register patents and trademarks
are capitalized as incurred. Amortization of these costs commences when the
related patent or trademark is filed. The costs are amortized over the estimated
useful life of the patent or trademark, generally seven years.

INCOME TAXES: The Company accounts for income taxes under Statement of
Financial Accounting Standards No. 109, Accounting for Income Taxes.

NET LOSS PER SHARE: Net loss per share is computed by dividing net loss for the
period by the weighted average number of shares of common stock and common
equivalent shares outstanding during the period. Common equivalent shares
representing stock warrants and options were excluded for fiscal years 1993,
1994 and 1995 because of their antidilutive effect.

STATEMENTS OF CASH FLOWS: For purposes of the statements of cash flows, the
Company considers all highly liquid debt instruments purchased with a maturity
of three months or less to be cash equivalents.

 3.MERGER OF SUBSIDIARIES

On December 20, 1993, AngeMed, Inc. ("AngeMed") and AngeLase, Inc. ("AngeLase"),
greater-than-90% owned subsidiaries of the Company, were merged with and into
the Company (the "Mergers"), with the Company being the surviving entity after
the Mergers. Pursuant to the Mergers, each share of common stock of AngeMed and
each share of common stock of AngeLase was converted into shares of Angeion
common stock. In addition, each option to purchase AngeMed or AngeLase common
stock was converted into an option to purchase Angeion common stock based upon
the respective exchange ratios.

Certain of the former AngeMed and AngeLase shareholders dissented from the
Mergers (the "Dissenters") and sought a higher value for the shares of AngeMed
and AngeLase common stock held by such shareholders in accordance with the
applicable provisions of Minnesota corporate law (the "Dissenters' Claims").
Effective May 31, 1994 and June 21, 1994, Settlement and Release Agreements were
entered into by and among the Company and the Dissenters (the "Settlement
Agreements"). Pursuant to the terms of the Settlement Agreements, the Dissenters
agreed to terminate their claims against the Company and the directors. In
exchange, the Company agreed to issue an aggregate of 636,004 shares of Common
Stock to the Dissenters in exchange for their subsidiary common stock and to
issue options to purchase Common Stock to the Dissenters in exchange for their
subsidiary options.

The fair market value of the Common Stock issued in connection with the Mergers
was accounted for as a purchase of in-process research and development and,
accordingly, a charge of $1,450,499 is included in the statement of operations
with an offsetting credit to shareholders' equity.

 4.DISCONTINUED OPERATIONS

On September 22, 1992, the Company sold its Angeion Medical Products division
("AMP") effective as of July 31, 1992. Net sales of AMP were $6,777,346 in
fiscal 1992. The sale price consisted of $6.2 million cash at closing, plus a
royalty of 10% and 5% of AMP product sales in fiscal 1993 and 1994,
respectively. A gain of $3,207,120 (including $770,366 of royalties) was
recognized in 1993 and royalty income of $482,853 was recognized in fiscal 1994.
As of July 31, 1995, there are no further royalties to be recognized.

 5.PROPERTY AND EQUIPMENT

At July 31 property and equipment consisted of the following:

<TABLE>
<CAPTION>
                                                     1994           1995
<S>                                               <C>            <C>
Production equipment                              $  296,495     $   630,953
Furniture and fixtures                               117,465         177,365
Computer equipment                                   538,793         848,906
Research and development equipment                   616,772         750,197
Leasehold improvements                               187,071         338,526
                                                   1,756,596       2,745,947
Less accumulated depreciation and amortization      (757,720)     (1,143,173)
                                                  $  998,876     $ 1,602,774
</TABLE>

 6.ALLIANCE AND LONG TERM DEBT

On February 4, 1993, Angeion and Siemens Pacesetter, Inc. ("Pacesetter"),
which was subsequently acquired by St. Jude Medical, Inc. entered into an
agreement which provided for an investment by Pacesetter in Angeion and the
grant by Angeion of certain licensing, manufacturing and marketing rights with
respect to certain of the products being developed by the Company. The
investment by Pacesetter consisted of the purchase of 875,000 shares of Angeion
preferred stock, Class A, at $4.00 per share. The preferred stock is convertible
at any time on a one-for-one basis into Common Stock. Pacesetter's investment
also includes the purchase of a $1,500,000 convertible subordinated debenture
with an interest rate of 7.16%, interest payable semi-annually, which is
convertible at any time into Common Stock at $6.00 per share. The debenture is
due in semi-annual installments of $150,000, beginning July 1, 1998 through July
1, 2003.

 7. NOTES PAYABLE

During June and July of 1994, the Company raised a total of $3,000,000 in the
form of short-term bridge loans ("Bridge Financing" or "Bridge Notes") to fund
its operations until it could complete an equity financing. All loans under the
Bridge Financing are evidenced by promissory notes accruing interest at a rate
of 12% per year. In connection with such loans, each lender received a warrant
to purchase, at an exercise price of $2.00 per share, shares of common stock
equal to 50% of the principal amount of the loan divided by the exercise price
of the warrant. The warrants expire on December 8, 1997. The warrants issued
were valued at $200,400 which was reflected as a discount and was amortized over
the term of the Bridge Notes. Certain directors of the Company participated in
the Bridge Financing and invested $1,000,000 in exchange for promissory notes
and warrants to purchase 250,000 shares. During September 1994, $1,434,746 in
Bridge Notes, net of discount, were converted into common stock and $1,500,000
in Bridge Notes were repaid.

 8.PUBLIC OFFERING

On September 19, 1994, the Company completed a public offering of 4.9 million
shares of newly issued common stock and warrants to purchase one-half of a share
of Common Stock, which raised proceeds of approximately $10,600,000, net of
expenses. The exercise price of the warrants per whole share is $4.75 per share
and they expire in March 1996. Net proceeds from the sale of the securities are
being used for research and development, investment in capital equipment and
leasehold improvements, general corporate purposes, including working capital,
and for the repayment of unconverted short-term bridge loans.

 9.SHAREHOLDERS' EQUITY

STOCK OPTIONS. The Company's shareholders have approved the 1993, 1991, 1989 and
1988 Stock Incentive Plans (the "Plans"). The Plans provide that incentive stock
options and nonqualified stock options to purchase shares of Common Stock may be
granted at prices determined by the Compensation Committee, except that the
purchase price of incentive stock options may not be less than 100% of the fair
market value of the stock at date of grant. All options expire not later than
ten years from date of grant.

In connection with the Mergers (Note 3), options under the AngeLase and AngeMed
Plans were converted into options to purchase Common Stock under the Plans.
Changes in options outstanding under the Plans are as follows:

<TABLE>
<CAPTION>
                                                        RANGE OF
                                        SHARES        OPTION PRICE
                                     UNDER OPTION      PER SHARE
<S>                                  <C>              <C>
Balance at July 31, 1992              1,270,121       $0.100-9.375
  Granted in fiscal 1993                104,465        2.062-3.875
  Exercised in fiscal 1993                    0                 --
  Forfeited in fiscal 1993             (556,000)       1.560-9.375
Balance at July 31, 1993                818,586        0.100-9.062
  Granted in fiscal 1994                818,296        1.970-3.500
  Conversion of subsidiary
   options                              541,738        0.032-2.160
  Forfeited in fiscal 1994             (115,530)       0.032-0.100
  Forfeited in fiscal 1994              (54,000)       2.062-4.062
Balance at July 31, 1994              2,009,090        0.032-9.062
  Granted in fiscal 1995                703,968        1.970-7.000
  Exercised in fiscal 1995             (522,174)       0.032-5.000
  Forfeited in fiscal 1995             (128,581)       0.032-3.875
Balance at July 31, 1995              2,062,303       $0.032-9.062
</TABLE>

Options for the purchase of 994,649 shares were exercisable at July 31, 1995.

The Company has granted options, outside the Plans, to purchase 272,063 shares
at prices ranging from $2.50 to $3.63 per share. At July 31, 1995, 222,063 of
these options were exercisable.

Options have also been granted under the Non-Employee Director Plan to purchase
63,000 shares at prices ranging from $2.44 to $3.19 per share. Under this plan,
annual stock grants of Common Stock valued at $16,000 are awarded to each
non-employee director.

WARRANTS. In connection with issuing a note payable to a shareholder in fiscal
1992, the Company issued a warrant to such shareholder to purchase 75,000 shares
of Common Stock at $2.50 per share. This warrant expires on July 27, 1999.

In connection with the Bridge Financing (Note 7), warrants to purchase 835,000
shares of Common Stock were issued at an exercise price of $2.00 per share.
These warrants expire on December 8, 1997.

In connection with a consulting agreement, warrants to purchase 40,000 shares
of Common Stock were issued, at an exercise price of $2.50 per share. These
warrants expire on December 15, 1998.

In connection with a public offering (Note 8), warrants to purchase 2,450,000
shares of Common Stock were issued at an exercise price of $4.75 per share.
These warrants expire on March 12, 1996. In addition, the placement agent for
the public offering was issued a warrant to purchase 490,000 shares of Common
Stock at $2.85 per share. This warrant expires on September 12, 1999.

10.LEASES

The Company leases office and production space under an operating lease. The
lease provides for executory costs which are subject to escalation based on
increases in the lessor's underlying costs. In addition, the Company leases
certain equipment under cancelable operating leases. Rent expense was
approximately $113,000, $116,000 and $138,000, for the years ended July 31,
1993, 1994 and 1995, respectively.

Future minimum lease payments under noncancelable operating leases (with initial
or remaining lease terms in excess of one year) are approximately $239,000,
$244,000 and $108,000 in 1996, 1997 and 1998, respectively.

11.INCOME TAXES

The Company has a tax net operating loss carryforward at July 31, 1995, of
approximately $25,000,000 which is available to reduce income taxes payable in
future years. If not used, this carryforward will begin to expire in 2004. Under
the Tax Reform Act of 1986, the utilization of these carryforwards may be
limited as a result of significant changes in ownership.

The actual tax expense (benefit) differs from the expected tax expense (benefit)
computed by applying the U.S. federal corporate income tax rate of 34.0% to the
net loss as follows:

<TABLE>
<CAPTION>
                                        1993        1994        1995
<S>                                     <C>         <C>         <C>
Federal statutory rate                  (34.0)%     (34.0)%     (34.0)%
State income taxes, net                  (6.0)       (6.0)       (6.0)
Expense on mergers of subsidiaries        0.0         6.4         0.0
Miscellaneous                            (1.7)        1.0         1.0
Change in valuation allowance            41.7        32.6        39.0
Effective income tax rate                 0.0%        0.0%        0.0%
</TABLE>

Deferred taxes, calculated using an effective tax rate of 39.0% as of July 31
consist of the following:

<TABLE>
<CAPTION>
                                        1994             1995
<S>                                  <C>             <C>
Net operating loss carryforwards     $ 6,511,000     $ 10,200,000
Other                                     25,000           65,000
Total net deferred tax assets          6,536,000       10,265,000
Less valuation allowance              (6,536,000)     (10,265,000)
Deferred income taxes                $         0     $          0
</TABLE>

The net deferred assets at July 31, 1994 and 1995, are fully offset by a
valuation allowance. The valuation allowance is reviewed annually.

12.RETIREMENT SAVINGS PLAN

The Angeion Corporation Tax Deferred Savings and Employees Stock Ownership Plan
(the "Plan") provides for contributions in the form of a salary reduction cash
or deferred arrangement, discretionary matching employer contribution,
discretionary supplemental employer contributions and voluntary after-tax
contributions by participating employees. Generally, all employees of the
Company who have completed six months of service with the Company are eligible
to participate in the Plan. Contribution expense was insignificant in all years
presented.

13.ROYALTY COMMITMENTS

The Company acquired the technology for its continuous-wave laser catheter
system. As part of this acquisition, the Company agreed to pay a royalty of 5%
on sales of patented products incorporating this technology for the life of any
patent on this technology. Additionally, in exchange for a doctor's efforts in
connection with the laser catheter ablation system, the Company has agreed to
pay the doctor and Carolinas Medical Center a royalty, when certain conditions
are met, of 2% and 3%, respectively, on all paid sales of laser ablation
devices. The Company has incurred no royalties through July 31, 1995, related to
the above commitment.

14.SUBSEQUENT EVENT

On August 2, 1995, the Company completed a public offering of 3.4 million shares
of newly issued Common Stock for proceeds of approximately $20,300,000, net of
expenses. During the nine months ended April 30, 1996 warrants that would have
expired on March 12, 1996 were exercised, along with certain stock options,
which provided to the Company net proceeds of approximately $12,800,000
(unaudited). The Company intends to apply the net proceeds of the sale of the
securities for research and development, investment in capital equipment and
leasehold improvements, and general corporate purposes, including working
capital.

                             ANGEION CORPORATION
                          CONSOLIDATED BALANCE SHEET
                                 (UNAUDITED)

<TABLE>
<CAPTION>
                                    APRIL 30,
                                      1996
<S>                                                       <C>
                                 ASSETS
Current assets:
  Cash and cash equivalents                               $ 14,789,510
  Short-term investments                                     7,328,201
  Receivables                                                  401,913
  Inventories                                                2,909,277
  Prepaid expenses and other current assets                    151,272
    Total current assets                                    25,580,173
Property and equipment, net                                  3,667,445
Patents and trademarks, net                                  1,190,277
Other assets                                                   135,073
    Total assets                                          $ 30,572,968
                  LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
  Accounts payable                                        $  1,778,547
  Accrued payroll, vacation and related costs                  611,327
  Current installments of capital lease obligations                984
  Other accrued expenses                                       236,306
    Total current liabilities                                2,627,164
Long-term debt                                               1,500,000
    Total liabilities                                        4,127,164
Shareholders' equity:
  Convertible preferred stock, series A, $0.01 par
   value. Authorized 1,475,000 shares; issued and 
   outstanding 875,000 shares at April 30, 1996              3,166,425
  Common stock, $0.01 par value.
   Authorized 35,000,000 shares; issued and
   outstanding 24,212,207 shares at April 30, 1996             242,122
  Additional paid-in capital                                60,384,733
  Accumulated deficit                                      (37,347,476)
    Total shareholders' equity                              26,445,804
    Total liabilities and shareholders' equity            $ 30,572,968
</TABLE>

See accompanying notes to consolidated financial statements.

                             ANGEION CORPORATION
                    CONSOLIDATED STATEMENTS OF OPERATIONS
                                 (UNAUDITED)

<TABLE>
<CAPTION>
                                                   NINE MONTHS ENDED APRIL 30,
                                                      1995             1996
<S>                                               <C>              <C>
Net sales                                         $         0      $    874,959
Operating expenses:
  Manufacturing expenses                                    0         2,278,242
  Research and development                          5,268,028         6,717,469
  Sales and marketing                                  12,767           387,634
  General and administrative                        1,495,868         2,444,543
    Total operating expenses                        6,776,663        11,827,888
    Operating loss                                 (6,776,663)      (10,952,929)
Other income (expense):
  Interest income                                     245,354           878,879
  Interest expense                                   (141,848)          (87,694)
    Other income (expense)                            103,506           791,185
    Net loss                                      $(6,673,157)     $(10,161,744)
Net loss per share                                $     (0.41)     $      (0.46)
Weighted average number of shares outstanding      16,291,900        21,953,593
</TABLE>

See accompanying notes to consolidated financial statements.

                             ANGEION CORPORATION
                    CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (UNAUDITED)


<TABLE>
<CAPTION>
                                                                     NINE MONTHS
                                                                   ENDED APRIL 30,
                                                                1995             1996
<S>                                                         <C>              <C>
Operating activities:
  Net loss                                                  $(6,673,157)     $(10,161,744)
  Adjustments to reconcile net loss to net cash used
   in operating activities:
    Depreciation and amortization                               433,385           684,412
    Compensation expense on grant of stock and stock
     options                                                    117,182           485,237
    Notes payable discount amortization                          83,500                --
    Changes in operating assets and liabilities:
      Receivables                                               183,675          (401,913)
      Inventories                                                   430        (2,510,489)
      Prepaid expenses and other current assets                  36,654            21,683
      Accounts payable                                          135,001           942,246
      Accrued expenses                                         (129,843)          416,580
       Net cash used in operating activities                 (5,813,173)      (10,523,988)
Investing activities:
  Purchase of short-term investments                                  0        (7,328,201)
  Payments for purchases of property and equipment             (803,289)       (2,543,497)
  Increase in other assets                                     (281,234)         (322,023)
       Net cash used in investing activities                 (1,084,523)      (10,193,721)
Financing activities:
  Proceeds from issuance of common stock                     10,599,122        20,327,045
  Proceeds from exercise of stock options                       381,192         1,184,779
  Proceeds from exercise of warrants                                  0        11,630,337
  Repayments of debt                                         (1,508,999)           (2,706)
       Net cash provided by financing activities              9,471,315        33,139,455
Net increase in cash and cash equivalents                     2,573,619        12,421,746
Cash and cash equivalents:
  Beginning of period                                         2,127,358         2,367,764
  End of period                                             $ 4,700,977      $ 14,789,510
Supplemental disclosure of cash flow information:
  Cash paid during the period for interest                  $   160,533      $     60,843
</TABLE>

Supplemental disclosure of non-cash investing and financing activities:

During the nine months ended April 30, 1995, notes payable of $1,434,746 were
converted into Common Stock.

See accompanying notes to consolidated financial statements.

                             ANGEION CORPORATION
             NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
                                APRIL 30, 1996

 1.BASIS OF PRESENTATION

The unaudited interim consolidated financial statements have been prepared by
the Company in accordance with generally accepted accounting principles,
pursuant to the rules and regulations of the Securities and Exchange Commission.
Accordingly, certain information and footnote disclosures normally included in
financial statements have been omitted or condensed pursuant to such rules and
regulations. The accompanying unaudited interim consolidated financial
statements should be read in conjunction with the financial statements and
related notes included herein. Effective November 1, 1995, the Company also
established a European subsidiary, Angeion Europe Ltd. ("AEL"), to facilitate
clinical trials of its ICDs and expand its European business activities.

The information furnished reflects, in the opinion of the management of the
Company, all adjustments, consisting primarly of recurring accruals, considered
necessary for a fair presentation of the financial position and the results of
operations.

 2.NET LOSS PER SHARE

Net loss per share is computed by dividing the net loss for the period by the
weighted average number of shares of Common Stock outstanding during the period.
Common equivalent shares representing stock warrants and options were excluded
in the fiscal 1995 and 1996 periods presented due to their antidilutive effect.

 3.PUBLIC OFFERING

On September 19, 1994, the Company completed a public offering of 4.9 million
shares of newly issued Common Stock and 4.9 million warrants to purchase
one-half of a share of Common Stock, which raised proceeds of $10,599,122 net of
expenses. The exercise price of the warrants per whole share was $4.75 per share
and they would have expired on March 12, 1996. Net proceeds of the sale of the
securities are being used for research and development, investment in capital
equipment and leasehold improvements, general corporate purposes, including
working capital, and for the repayment of unconverted short-term bridge loans.

On August 2, 1995, the Company completed a public offering of 3.4 million shares
of newly issued Common Stock for proceeds of $20,327,045 net of expenses During
the nine months ended April 30, 1996 warrants that would have expired on March
12, 1996 were exercised, along with certain stock options, which provided to the
Company net proceeds of approximately $12,800,000. The Company intends to apply
the net proceeds of the sale or securities for research and development and
leasehold improvements, and general corporate purposes, including working
capital.


Inside Back Cover

3 part illustration of the procedure using catheter ablation device.
Illustration of patient and the insertion of catheter in femoral artery of leg
and up and into the heart. Cross section of heart depicting location of ablation
catheter and site of abnormal cells. Closeup of abnormal heart tissue in the
electrical pathways and the application of energy to the abnormal electrical
pathways.



NO DEALER, SALESPERSON OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS IN
CONNECTION WITH THE OFFER MADE BY THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE COMPANY OR THE UNDERWRITERS. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER
TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE
COMMON STOCK TO WHICH IT RELATES, OR AN OFFER IN ANY JURISDICTION TO ANY PERSON
TO WHOM IT IS UNLAWFUL TO MAKE SUCH AN OFFER IN SUCH JURISDICTION. NEITHER THE
DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN IS
CORRECT AT ANY TIME AFTER THE DATE HEREOF.


          TABLE OF CONTENTS



<TABLE>
<CAPTION>
                                          PAGE
<S>                                       <C>
Summary                                     3
Risk Factors                                6
Use of Proceeds                            13
Dilution                                   13
Capitalization                             14
Dividend Policy                            14
Market Price for Common Stock              15
Selected Financial Data                    16
Management's Discussion and
 Analysis of Financial Condition and
 Results of Operations                     17
Business                                   21
Management                                 34
Principal Shareholders and Beneficial
 Ownership of Management                   38
Description of Securities                  39
Underwriting                               42
Legal Matters                              44
Experts                                    44
Available Information                      44
Incorporation of Certain
 Documents by Reference                    45
Index to Financial Statements             F-1
</TABLE>
                                5,000,000 SHARES


                                  ANGEION LOGO


                                  COMMON STOCK
                               P R O S P E C T U S
                        RAYMOND JAMES & ASSOCIATES, INC.
                           NATWEST SECURITIES LIMITED
                              SALOMON BROTHERS INC
                          _______________________, 1996


                                   PART II
                    INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The table below sets forth estimated expenses in connection with the issuance
and distribution of the Common Stock being offered hereby. All of such expenses
are estimates, except for the SEC registration fee, the NASD fee and the Nasdaq
additional listing fee.

<TABLE>
<CAPTION>
<S>                                                 <C>
SEC registration fee                                $ 20,696
NASD fee                                               6,502
Nasdaq additional listing fee                         17,500
Printing expenses                                     90,000
Fees and expenses of counsel for the Company          60,000
Fees and expenses of accountants for the Company      35,000
Blue Sky fees and expenses                            12,000
Miscellaneous                                          8,302
  Total                                             $250,000
</TABLE>
*To be supplied by amendment.

ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.

Minnesota Statutes Section 302A.521 provides that a Minnesota business
corporation shall indemnify any director, officer, employee or agent of the
corporation made or threatened to be made a party to a proceeding, by reason of
the former or present official capacity (as defined) of the person, against
judgments, penalties, fines, settlements and reasonable expenses incurred by the
person in connection with the proceeding if certain statutory standards are met.
"Proceeding" means a threatened, pending or completed civil, criminal,
administrative, arbitration or investigative proceeding, including one by or in
the right of the corporation. Section 302A.521 contains detailed terms regarding
such right of indemnification and reference is made thereto for a complete
statement of such indemnification rights. The Company's Restated Articles of
Incorporation also require the Company to provide indemnification to the fullest
extent of the Minnesota indemnification statute.

Article V of the Company's Bylaws provides that each director, officer, employee
or agent, past or present, of the Company, and each person who serves or may
have served at the request of the Company as a director, officer, employee or
agent of another corporation or employee benefit plan, and their respective
heirs, administrators and executors, shall be indemnified by the Company in
accordance with, and to the fullest extent permissible by, applicable state law.

The Company maintains directors' and officers' liability insurance, including a
reimbursement policy in favor of the Company.

Pursuant to Section 8 of the Underwriting Agreement, the directors and officers
of the Company are indemnified against certain civil liabilities that they may
incur under the Securities Act in connection with this Registration Statement
and the related Prospectus.

ITEM 16. EXHIBITS

<TABLE>
<CAPTION>
  <S>     <C>
   1.1    Form of Underwriting Agreement (to be filed by amendment).

   4.1    Articles of Merger, including Amended and Restated Articles of
          Incorporation (incorporated by reference to Exhibit 3A contained in
          its Registration Statement on Form 8-A registering the Common Stock
          (File No. 0-17019)).

   4.2    Amended Bylaws (filed herewith).

   4.3    Amended Form of Common Stock Certificate (filed herewith).

   4.4    Certificate of Designation of Preferred Stock, Series A (incorporated
          by reference to Exhibit 4.1 contained in the Current Report on form
          8-K filed February 9, 1993) (File No. 0-17019).

   5.1    Opinion and Consent of Oppenheimer Wolff & Donnelly (filed herewith).

  23.1    Consent of KPMG Peat Marwick LLP (filed herewith).

  23.2    Consent of Oppenheimer Wolff & Donnelly (see Exhibit 5.1).

  23.3    Consent of Patterson & Keough, P.A. (to be filed by amendment).

  24.1    Power of Attorney (included on page II-3 of this Registration Statement).

  27.1    Financial Data Schedule (incorporated by reference to Exhibit 27.1 of
          the Company's Quarterly Report on Form 10-Q for the quarterly period
          ended April 30, 1996) (File No. 0-17019).
</TABLE>

ITEM 17. UNDERTAKINGS

The undersigned registrant hereby undertakes that, for purposes of determining
any liability under the Securities Act of 1933, each filing of the registrant's
annual report pursuant to section 13(a) or section 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.

Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.

The undersigned registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities Act of 1933,
the information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h)
under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective.

(2) For the purpose of determining any liability under the Securities Act of
1933, each post-effective amendment that contains a form of prospectus shall be
deemed to be a new registration statement relating to the securities offered
herein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.

                                  SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Minneapolis and State of Minnesota, on May 30,
1996.
                                  ANGEION CORPORATION
                                  By /S/ WHITNEY A. MCFARLIN 
                                         Whitney A. McFarlin
                                  PRESIDENT AND CHIEF EXECUTIVE OFFICER

                              POWER OF ATTORNEY

KNOW ALL BY THESE PRESENTS, that each person whose signature appears below
constitutes and appoints Whitney A. McFarlin and David L. Christofferson as his
or her true and lawful attorney-in-fact and agent, with full powers of
substitution and resubstitution, for him or her and in his or her name, place
and stead, in any and all capacities, to sign any or all amendments (including
post-effective amendments) to this Registration Statement and any or all
registration statements relating to the offering covered hereby that may be
filed with the Securities and Exchange Commission pursuant to Rule 462(b) under
the Securities Act of 1933, as amended, and to file the same, with all exhibits
thereto, and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorney-in-fact and agent, full power
and authority to do and perform each and every act and thing requisite or
necessary to be done in and about the premises, as fully to all intents and
purposes as he or she might or could do in person, hereby ratifying and
confirming all that said attorney-in-fact and agent, or her substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the following persons on May 30, 1996 in the
capacities indicated.

<TABLE>
<CAPTION>
             SIGNATURE                                         TITLE
<S>                                 <C>
/S/ WHITNEY A. MCFARLIN Whitney     Chairman of the Board, President and Chief
 A. McFarlin                        Executive Officer (principal executive officer)

/S/ DAVID L. CHRISTOFFERSON         Vice President, Chief Financial Officer and Secretary
David L. Christofferson                  (principal financial and accounting officer)
 
/S/ ARNOLD A. ANGELONI              Director
Arnold A. Angeloni

                                    Director
 Dennis E. Evans

                                    Director
 Lyle D. Joyce, M.D., Ph.D.

/S/ JOSEPH C. KISER, M.D.           Director
Joseph C. Kiser, M.D.

/S/ DONALD MAURER                   Director
Donald Maurer 

/S/ GLEN TAYLOR                     Director
Glen Taylor 

</TABLE>

                             ANGEION CORPORATION
             EXHIBIT INDEX TO REGISTRATION STATEMENT ON FORM S-3

<TABLE>
<CAPTION>
   ITEM
   NO.                             ITEM                                            METHOD OF FILING
<S>        <C>                                                  <C>
1.1        Form of Underwriting Agreement                       To be filed by amendment.

4.1        Articles of Merger, including Amended and Restated   Incorporated by reference to Exhibit 3A contained in its
           Articles of Incorporation                            Registration Statement on Form 8-A registering the Common
                                                                Stock (File No. 0-17019).

4.2        Amended Bylaws                                       Filed herewith.

4.3        Amended Form of Common Stock Certificate             Filed herewith.

4.4        Certificate of Designation of Preferred Stock,       Incorporated by reference to Exhibit 4.1 contained in
           Series A.                                            the Current Report on Form 8-K filed February 9, 1993
                                                                (File No. 0-17019).

5.1        Opinion and Consent of Oppenheimer Wolff & Donnelly  Filed herewith.

23.1       Consent of KPMG Peat Marwick LLP                     Filed herewith.

23.2       Consent of Oppenheimer Wolff & Donnelly              (see Exhibit 5.1).

23.3       Consent of Patterson & Keough, P.A.                  To be filed by amendment.

24.1       Power of Attorney                                    (included on page II-3 of this Registration Statement).

27.1       Financial Data Schedule                              Incorporated by reference to Exhibit 27.1 of the Company's
                                                                Quarterly Report on Form 10-Q for the quarterly period
                                                                ended April 30, 1996 (File No. 0-17019).
</TABLE>



                                 AMENDED BYLAWS
                                       OF
                               ANGEION CORPORATION


                                    ARTICLE I
                                     OFFICES

         The registered office of the corporation shall be that set forth in the
Articles of Incorporation dated March 6, 1987, filed with the Secretary of State
of Minnesota on March 10, 1987, or in the most recent amendment thereof, or in a
statement of the Board of Directors filed with the Secretary of State of the
State of Minnesota changing the registered office in the manner prescribed by
law. The corporation may also have offices and places of business at such other
locations as the Board of Directors may from time to time designate, or the
business of the corporation may require.

                                   ARTICLE II
                             SHAREHOLDER'S MEETINGS

         SECTION 2.1. TIME AND PLACE OF MEETINGS. Regular or special meetings of
the shareholders, if any, shall be held on the date and at time and place fixed
by the President/Chief Executive Officer or the Board of Directors, except that
a meeting called by, or at the demand of a shareholder or shareholders, pursuant
to Minnesota Statutes, Section 302A.431, Subd. 2, shall be held in the county
where the principal executive office is located.

         SECTION 2.2. REGULAR MEETINGS. An annual meeting of the shareholders
shall be held at such place as the Board of Directors shall designate, either
within or without the State of Minnesota, and on such date and at such time as
may be determined by the Board of Directors and communicated to the shareholders
according to the requirements set forth herein, for the purpose or electing
directors and for the transaction of any other business which may properly come
before it. Additional regular meetings of the shareholders may be held on a less
frequent periodic basis. No meeting shall be considered a regular meeting unless
specifically designated as such in the notice of meeting or unless all the
shareholders are present in person or by proxy and none of them objects to such
designation. Any business appropriate for action by the shareholder may be
transacted at a regular meeting.

         SECTION 2.3. SPECIAL MEETINGS. Special meetings of the shareholders may
be held for any purpose or purposes, unless otherwise prescribed by statute.
Such a meeting may be called by the President/Chief Executive Officer, the Chief
Financial Officer or two or more directors and shall be called by the
President/Chief Executive Officer at the request in writing of shareholders
owning not less than ten percent (10%) or more of the voting stock of the
corporation.

         SECTION 2.4. NOTICE OF MEETINGS. Written notice of a meeting of the
shareholders stating the time and place thereof shall be mailed at least five
(5) days but not more than sixty (60) days prior to the meeting, except as
otherwise provided by statute, to each shareholder entitled to vote thereat to
the last known address of such shareholder as the same appears upon the books of
the corporation.

         Every notice of any special meeting shall state the purpose or purposes
for which the meeting has been called, and the business transacted at all
special meetings shall be confined to the purpose stated in the call, unless all
of the shareholders are present in person or by proxy and none of them objects
to consideration of a particular item of business.

         SECTION 2.5. RECORD DATE. The determination of shareholders entitled to
vote at a regular or special meeting shall be made on the date fixed by the
Board of Directors for closing of the books of the corporation. If no date is
fixed by the Board, the date for such determination shall be the date five (5)
days before the date of such meeting.

         SECTION 2.6. WAIVER OF NOTICE. Notice of the time, place and purpose of
any meeting of shareholders, whether required by statue, the Articles of
Incorporation or these Bylaws, may be waived by any shareholder. Such waiver may
be given before, at, or after the meeting, and may be given in writing, orally
or by attendance.

         SECTION 2.7. ACTION WITHOUT MEETING. Any action which may be taken at a
meeting of the shareholders may be taken without a meeting, if authorized in
writing or writings signed by all shareholders who would be entitled to notice
of a meeting for such purpose.

         SECTION 2.8. QUORUM. The presence at any meeting, in person or by
proxy, of the holders of a majority of the shares entitled to vote, shall
constitute a quorum for the transaction of business. If, however, such majority
shall not be present in person or by proxy at any meeting of the shareholders,
those present shall have the power to adjourn the meeting from time to time,
without notice other than by announcement at the meeting, until the requisite
amount of voting shares shall be represented. At any such adjourned meeting at
which the required number of voting shares shall be represented, any business
may be transacted which might have been transacted at the meeting as originally
noticed.

         SECTION 2.9. VOTING. At all meetings of the shareholders, each
shareholder having the right to vote shall be entitled to vote in person or by
proxy, duly appointed by an instrument in writing subscribed by such
shareholder. Each shareholder shall have one (1) vote for each share having
voting power standing in his name on the books of the corporation. Upon the
demand of any shareholder, the vote for directors or the vote upon any question
before the meeting shall be by ballot. All elections shall be had and all
questions decided by a majority vote except as otherwise required by these
Bylaws, the Articles of Incorporation, any applicable shareholder agreement, or
statute.

         SECTION 2.10. PROXIES. At all meetings of shareholders, a shareholder
may vote by proxy executed in writing by the shareholder or by his duly
authorized attorney-in-fact. Such proxy shall be filed with the Secretary of the
corporation at or before the time of the meeting. A proxy shall be valid for the
period specified in the proxy or, if no expiration date is provided in the
proxy, for a period not to exceed eleven months from the date of its execution.
A proxy's authority shall not be revoked by the death or incapacity of the maker
unless, before the vote is cast and the authority exercised, written notice of
such death or incapacity is given to the corporation.


                                   ARTICLE III
                               BOARD OF DIRECTORS

         SECTION 3.1. ELECTION OF DIRECTORS. The business and affairs of this
corporation shall be managed by its Board of Directors. The number of directors
shall be the number last elected by a majority vote of the shareholders or by
the Board of Directors, which number shall not be less than two (2) nor more
than nine (9) directors. Directors need not be shareholders. Each of the
directors shall hold office until the regular meeting of the shareholders next
held after his election, until a successor shall have been elected and shall
qualify, or until he shall resign or shall have been removed as hereinafter
provided.

         SECTION 3.2. BOARD MEETINGS; PLACE AND NOTICE. Meetings of the Board of
Directors may be held from time to time at anyplace within or without the State
of Minnesota that the Board of Directors may designate. In the absence of
designation by the Board of Directors. Board meetings shall be held at the
principal executive office of the corporation, except as may be otherwise
unanimously agreed orally or in writing or by attendance. Any director may call
a meeting of the Board of Directors by giving two (2) days notice to all
directors of the date and time of the meeting. The notice need not state the
purpose of the meeting. Notice may be given by mail, telephone, telegram or in
person. If a meeting schedule is adopted by the Board of Directors, or if the
date and time of a Board of Directors meeting has been announced at a previous
meeting, no notice is required.

         SECTION 3.3. WAIVER OF NOTICE. Notice of the time, place and purpose of
any meeting of the Board of Directors, whether required by statue, the Articles
of Incorporation, or these Bylaws, may be waived by any director. Such waiver
may be given before, at, or after the meeting and may be given in writing,
orally or by attendance. The attendance of a director at a meeting and
participation therein shall constitute waiver of notice of such meeting unless
the director attends for the express purpose of objecting to the transaction of
business because the meeting is not lawfully called or convened, the director so
states at the meeting, and the director does not thereafter participate in the
meeting.

         SECTION 3.4. QUORUM AND ACTION OF BOARD. At all meetings of the Board
of Directors, a majority of the directors shall be necessary and sufficient to
constitute a quorum for the transaction of business; provided, that if less than
a majority of the directors are present, a majority of those present may adjourn
the meeting from time to time without notice other than an announcement at the
meeting at which adjournment is taken.

         The directors present at a duly called or held meeting at which a
quorum is present may continue to transact business until adjournment,
notwithstanding the withdrawal of enough directors to leave less than a quorum.

         The act of a majority of the directors present at any meeting at which
a quorum is present, or at any meeting at which a quorum was present and at
which the remaining directors are authorized under this Section to continue to
transact business shall be the act of the Board of Directors.

         SECTION 3.5. ELECTRONIC COMMUNICATIONS. A conference among directors by
any means of communication through which the directors may simultaneously hear
each other during the conference constitutes a board meeting, if the same notice
is given of the conference as required by these Bylaws for a meeting, and if the
number of directors participating in the conference would be sufficient to
constitute a quorum at a meeting. Participation in a meeting by such electronic
means of communication constitutes presence in person at the meeting.

         SECTION 3.6. VACANCIES. Any vacancy occurring on the Board of Directors
by reason of death, resignation, disqualification, or increase in the number of
directors, may be filled by a majority of the remaining directors, though less
than a quorum, at any regular or special meeting, except that vacancies on the
Board resulting from newly created directorships may only be filled by a
majority vote of the directors serving at the time of the increase. Each
director so elected shall hold office until the next regular or special
shareholder meeting or until his or her successor is elected and qualified.

         SECTION 3.7. RESIGNATIONS. Any director of the corporation may resign
at any time by giving written notice to the Chairman of the Board or to the
President/Chief Executive Officer or Secretary of the corporation. Unless a
later date is specified in the notice of resignation as the effective date of
resignation, resignation shall take effect on the date of receipt of the written
notice by the Chairman, President/Chief Executive Officer, or Secretary. Unless
otherwise specified in such notice, the acceptance of the resignation shall not
be necessary to make it effective.

         SECTION 3.8. REMOVAL. At a meeting of shareholders called expressly for
that purpose, any director or the entire Board of Directors may be removed, with
or without cause, by a vote of the holders of a majority of the shares then
entitled to vote at an election of directors. Provided, however, that if less
than the entire Board is to be removed, no one of the directors may be removed
if the votes cast against his removal would be sufficient to elect him if then
cumulatively voted at an election of the entire Board of Directors.

         SECTION 3.9. ABSENT DIRECTORS. A director may give advance written
consent or opposition to a proposal to be acted on at a Board meeting. If the
director is not present at the meeting, consent or opposition to a proposal does
not constitute presence for purposes of determining the existence of a quorum,
but consent or opposition stated in writing and delivered to the President/Chief
Executive Officer or the officer or director presiding at the meeting shall be
counted as a vote in favor of or against the proposal if the proposal acted on
at the meeting is substantially the same or has substantially the same effect as
the proposal to which the director has consented or objected. Such written
consent or opposition shall be entered in the minutes or other record of action
at the meeting.

         SECTION 3.10. ACTION WITHOUT MEETING. Any action which is required or
may be taken at a meeting of the Board of Directors may be taken without a
meeting if a consent in writing, setting forth the action so taken, is signed by
a majority of all the directors entitled to vote with respect to the subject
matter thereof, except as to matters that require shareholder approval, in which
case such consent in writing must be signed by all of the directors. Action
taken by such written consent shall be effective on the date when signed by the
required number of directors, or such earlier effective date as set forth
therein. When written action is permitted to be taken by less than all of the
directors, all directors shall be notified immediately of its text and effective
date. Failure to provide the notice shall not invalidate the written action. A
director who does not sign or consent to the written action shall have no
liability for the action or actions taken thereby.

         SECTION 3.11. PRESUMPTION OF ASSENT. For purposes of any liability as a
director, a director of the corporation who is present at a meeting of the Board
of Directors at which action on any corporate matter is taken shall be presumed
to have assented to the action taken unless:

                  (a) He objects at the beginning of the meeting to the
         transaction of business because the meeting is not lawfully called or
         convened and does not thereafter participate in the meeting;

                  (b) He votes against the action at the meeting; or

                  (c) He is prohibited from voting at the meeting due to a
         conflict of interest.

         SECTION 3.12. COMMITTEES. The Board of Directors may, by a majority
vote, designate two or more of their number to constitute an executive
committee, which, to the extent determined by the Board and allowed by law,
shall have and exercise the authority of the Board in the management of the
business of the corporation. Such executive committee shall act only in the
interval between meetings of the Board and shall be subject at all times to the
control and direction of the Board. The Board of Directors by a majority vote
may also appoint one or more natural persons who need not be Board members to
serve on such other committees as the Board may determine. Such other committees
shall have powers and duties as shall from time to time be prescribed by the
Board. A majority of the members of any committee present at a meeting is a
quorum for the transaction of business. All committees shall keep accurate
minutes of their meetings, which minutes shall be made available upon request to
members of that committee and to any director.

         SECTION 3.13. CHAIRMAN. The Board may elect one of their number to
serve as Chairman, who shall preside, when present, at all meetings of the
Board.

         SECTION 3.14. COMPENSATION. The directors of the corporation and all
members of committees shall serve without salary, unless ordered by the
directors; however, they shall be paid the necessary expenses incurred in the
execution of their duties. Nothing herein shall preclude the paying by the
corporation of a salary or other compensation to an officer or employee who is
also a director.

         SECTION 3.15. LIMITATION OF LIABILITY. Except as expressly provided in
Minnesota Statues, Section 302A.251, Subd. 4, a member of the Board of Directors
of this corporation shall have no personal liability to this corporation or to
the shareholders for monetary damages for breach of fiduciary duty as a member
of the Board of Directors. Amendment or repeal of Section 4.06 of the Articles
of Incorporation of this corporation shall not adversely affect any limitation
of liability of a director with respect to any liability or alleged liability
arising out of any act or omission occurring prior to such amendment or repeal.

                                   ARTICLE IV
                                    OFFICERS

         SECTION 4.1. ELECTION OF OFFICERS. The Board of Directors shall, from
time to time, elect a President/Chief Executive Officer and a Treasurer/Chief
Financial Officer. The Board of Directors may, but shall not be required to,
elect a Secretary and one (1) or more Vice Presidents, as they may determine,
one of whom may be designated as an Executive Vice President. In addition, the
Board of Directors may elect such other officers and agents as it may determine
necessary, including Assistant Secretaries and Assistant Treasurers. Such
officers shall exercise such powers and perform such duties as are prescribed by
the Articles of Incorporation or the Bylaws or as may be otherwise determined
from time to time by the Board of Directors. Any number of offices or functions
of those officers may be held or exercised by the same person.

         SECTION 4.2. TERMS OF OFFICE. The officers of the corporation shall
hold office for such terms as shall be determined from time to time by the Board
of Directors or until their successors are chosen and qualify in their stead.
Any officer elected or appointed by the Board of Directors may be removed by the
affirmative vote of a majority of the whole Board of Directors with or without
cause.

         SECTION 4.3. SALARIES. The salaries of all officers and agents of the
corporation shall be determined by the Board of Directors.

         SECTION 4.4. PRESIDENT/CHIEF EXECUTIVE OFFICER. The President/Chief
Executive Officer shall be the chief executive officer of the corporation, and
shall have the general direction of the affairs of the corporation. He shall
preside at all meetings of the shareholders and of the Board of Directors. He
shall direct general active management of the business of the corporation, and
shall see that all orders and resolutions of the Board of Directors are carried
into effect. He shall execute all contracts, mortgages and other instruments of
the corporation, and may appoint and discharge agents and employees. He shall be
ex officio a member of any executive committee which may be constituted
hereunder, and all other standing committees, and shall perform all such other
duties as are incident to his office, or are properly required of him by the
Board of Directors. As used herein or in other writings of, or documents
delivered on behalf of, the corporation, the titles "President" and "Chief
Executive Officer" shall mean one and the same person and shall be
interchangeable.

         SECTION 4.5. VICE PRESIDENT. The Vice Presidents in the order
designated by the Board of Directors shall perform the duties and exercise the
powers of the President/Chief Executive Officer in his absence or incapacity.
The Vice Presidents shall perform such other duties as the Board of Directors
shall from time to time prescribe.

         SECTION 4.6. SECRETARY AND ASSISTANT SECRETARIES. The Secretary shall
attend all sessions of the Board of Directors and all meetings of the
shareholders, and record all votes and minutes for all proceedings in a book
kept for that purpose, and shall perform like duties of the standing committees
when required. He shall give or cause to be given notice of all meetings of the
shareholders and of the Board of Directors, and shall perform such other duties
as may be prescribed by the Board of Directors or the President/Chief Executive
Officer under whose supervision he shall be. He shall keep in safe custody the
seal, if any, of the corporation, and shall affix the same to any instrument
requiring it.

         The Assistant Secretary shall, in the absence or disability of the
Secretary, perform the duties and exercise the powers of the Secretary, and
shall perform such other duties as the Board of Directors shall prescribe.

         SECTION 4.7. TREASURER/CHIEF FINANCIAL OFFICER AND ASSISTANT
TREASURERS. The Treasurer/Chief Financial Officer shall have the custody of the
corporate funds and securities, and shall keep full and accurate account of
receipt and disbursements in books belonging to the corporation, and shall
deposit all moneys and other valuable effects in the name and to the credit of
the corporation in such depositories as may be designated from time to time by
the Board of Directors; he shall disburse the funds of the corporation in
discharge of corporate liabilities and obligations as may be ordered by the
Board of Directors from time to time, taking the proper vouchers for such
disbursements, and shall render to the President and the Board of Directors
whenever they may require the same, an account of all of his transactions and of
the financial condition of the corporation; he shall give the corporation a
bond, if required by the Board of Directors, in such sum as the Board of
Directors may be resolution determine; and with one (1) or more sureties
satisfactory to the Board of Directors for the faithful performance of the
duties of his office, and for the restoration to the corporation in case of
death, resignation, retirement or removal form office of all books. vouchers,
papers, money and other property of whatsoever kind in this possession or under
his control belonging to the corporation. As used herein or in other writings
of, or documents delivered on behalf of, the corporation, the titles "Treasurer"
and "Chief Financial Officer" shall mean one and the same person and shall be
interchangeable.

         The Assistant Treasurer shall, in the absence or disability of the
Treasurer/Chief Financial Officer, perform the duties and exercise the powers of
the Treasurer/Chief Financial Officer, and shall perform such other duties as
the Board of Directors shall prescribe.

         SECTION 4.8. VACANCIES. If the office of any officer or agent becomes
vacant by reason of death, resignation, retirement, disqualification, removal
from office or otherwise, the Board of Directors, by a majority vote, shall
choose a successor or successors who shall hold office for the unexpired term in
respect of which such vacancy occurred.

         SECTION 4.9. DELEGATION OF AUTHORITY. An officer elected or appointed
by the Board of Directors may delegate some or all of the duties or powers of
his office to other persons, provided that such delegation is in writing.

         SECTION 4.10. CONTRACT RIGHTS. The election or appointment of a person
as an officer or agent does not, of itself, create contract rights.

                                    ARTICLE V
                                 INDEMNIFICATION

         To the full extent permitted or required by Section 302A.521 of the
Minnesota Business Corporation Act, as now enacted or hereinafter amended, or by
other provisions of law, each person who was or is a party or is threatened to
be made a party to any threatened, pending, or pleaded action, suit, or
proceeding, whenever brought, whether civil, criminal, administrative or
investigative, by reason of the fact that he is or was a director, officer or
agent of the corporation, or he is or was serving at the specific request of the
corporation as a director, officer, employee, fiduciary, or agent of another
corporation, partnership, joint venture, trust or other entity or enterprise,
shall be indemnified by the corporation against expenses, including attorneys'
fees, judgments, fines, and amounts paid in settlement, actually and reasonably
incurred by him in connection with such action, suit, or proceeding; provided,
however, that the indemnification with respect to a person who is or was serving
as a director, officer, employee, fiduciary, or agent of another corporation,
partnership, joint venture, trust, or other enterprise shall apply only to the
extent such person is not indemnified by such other corporation, partnership,
joint venture, trust, or other entity or enterprise. Indemnification provided by
this paragraph shall continue as to a person or agent and shall inure to the
benefit of the heirs, executors, and administrators of such person and shall
apply whether or not the claim against such person arises out of matters
occurring before the adoption of this paragraph.

         To the full extent permitted by the Minnesota Business Corporation Act,
as now enacted or hereinafter amended, the corporation shall have the authority
to purchase and maintain insurance for officers, directors, employees and agents
against liability arising out of their status as such.

         Further, to the full extent permitted by the Minnesota Business
Corporation Act, as now enacted or hereinafter amended, the corporation shall
have the authority to enter into such agreements as the Board of Directors deem
appropriate for the indemnification of present or future directors and officers
of the corporation in connection with their service to, or status with, the
corporation or any other corporation, entity or enterprise with which such
person is serving at the express written request of the corporation.

                                   ARTICLE VI
                                     SHARES

         SECTION 6.1. ISSUANCE OF SHARES. The Board of Directors is authorized
and empowered to issue shares of the capital stock of the corporation to the
full amount authorized by the Articles of Incorporation and all amendments
thereto in such amounts and at such times as may be determined by the Board of
Directors and as permitted by law.

         SECTION 6.2. CERTIFICATES. Certificates for shares of the capital stock
of the corporation shall be in such form or forms as may be determined by the
Board of Directors or those actually used in the event the Board fails to act.
Each shareholder shall be entitled to a certificate representing his or her
shares of stock, signed by the President/Chief Executive Officer or a Vice
President, and by the Secretary or an Assistant Secretary, if one has been
elected or appointed, otherwise, by the Treasurer/Chief Financial Officer or an
Assistant Treasurer; provided, however, that where a certificate is
countersigned by a transfer agent or an assistant transfer agent or by a
transfer clerk acting on behalf of the corporation and registered by a
registrar, the signatures of said officers on such certificates for shares may
be facsimiles. If a person signs or has a facsimile signature placed upon a
certificate while an officer, transfer agent, or registrar of the corporation,
the certificate may be issued by the corporation even if the person has ceased
to have that capacity before the certificate is issued with the same effect as
if the person had that capacity at the date of its issue. All certificates for
shares shall be consecutively numbered or otherwise identified, and shall state
the name of the corporation, that it is organized under the laws of the State of
Minnesota, the name of the person to whom the shares are issued, the number and
class of shares, and the designation of the series, if any, that the certificate
represents. The name of the person to whom the shares are issued with the number
of shares and date of issue shall be entered on the books of the corporation.

         SECTION 6.3. TRANSFER OF SHARES. The shares of stock of the corporation
shall be transferable upon its books only by persons named in the certificates
or by attorney lawfully constituted in writing, and upon surrender to the
corporation of the old stock certificates, properly endorsed, to the person in
charge of the stock and transfer books and designate, by whom they shall be
cancelled. New certificates of the shares shall thereupon be issued to the
person entitled to such new certificates. A record shall be made of each
transfer, and whenever a transfer shall be made for collateral security, and not
absolutely, it shall be so expressed in the entry of the transfer.

         SECTION 6.4. LOST CERTIFICATES. Any shareholder claiming a certificate
of shares to be lost, stolen or destroyed shall make an affidavit or affirmation
of that fact in such form as the Board of Directors may require, and shall, if
the Board of Directors so requires:

                  (a) advertise such fact in such manner as the Board of
         Directors may require;

                  (b) give to the corporation and its transfer agent and
         registrar, if any, a bond of indemnity in open penalty as to amount or
         in such other sum as the Board of Directors may direct, in form
         satisfactory to the Board of Directors and to the transfer agent and
         registrar of the corporation, if any, and with or without such sureties
         as the Board of Directors with the approval of the transfer agent and
         registrar, if any, may prescribe; and

                  (c) satisfy such other requirements as may be imposed by the
         Board.

         If notice by the shareholder of the loss, destruction, or wrongful
taking of a certificate is received by the corporation before the corporation
has received notice that the shares represented by such certificate have been
acquired by a bona fide purchaser, and if the foregoing requirements imposed by
the Board are satisfied, then the Board of Directors shall authorize the
issuance of a new certificate for shares of the same tenor and for the same
number of shares as the one alleged to have been lost or destroyed.

         SECTION 6.5. DIVIDENDS. The Board of Directors may declare dividends to
the extent permitted by Section 302A.551 of the Minnesota Business Corporation
Act as and when it deems expedient. Before declaring any dividend, there may be
reserved out of the accumulated profits such sums as the Board of Directors from
time to time, in its discretion, thinks proper for working capital or as a
reserve fund to meet contingencies or for equalizing dividends, or for such
other purposes as the Board of Directors shall think conducive to the interests
of the corporation.

         Shareholders entitled to payment of such dividend shall be those
shareholders of record on the date fixed by the Board for closing of the books
of the corporation. If no date for closing of the books is fixed by the Board,
the shareholders entitled to payment of the dividend shall be the shareholders
of record on the date on which the resolution declaring such dividend is adopted
by the Board.

                                   ARTICLE VII
                                  MISCELLANEOUS

         SECTION 7.1. BOOKS OF ACCOUNT. The corporation shall keep such books of
account as are required by Section 302A.461 of the Minnesota Business
Corporations Act and every shareholder shall have a right to examine such books,
in person or by agent or attorney, to the extent provided in such Section.

         SECTION 7.2. CORPORATE SEAL. If so directed by the Board of Directors,
the corporation may use a corporate seal. The failure to use such seal, however,
shall not affect the validity of any documents executed on behalf of the
corporation. The seal need only include the word "seal", but it may also
include, at the discretion of the Board of Directors, such additional wording as
is permitted by law.

         SECTION 7.3. CHECKS AND DOCUMENTS. All checks or demands for money and
notes of the corporation and all other instrument, documents or deeds of every
kind, nature and description required to be executed in the name and in behalf
of the corporation shall be signed by such of the officers or agents of the
corporation as the Board of Directors may from time to time by resolution
designate and determine.

         SECTION 7.4. FISCAL YEAR. The fiscal year of this corporation shall be
as determined by resolution of the Board of Directors.

         SECTION 7.5. AMENDMENTS TO BYLAWS. These Bylaws may be amended or
altered by the vote of a majority of the Board of Directors present at any
meeting provided that notice of such proposed amendments shall have been given
in the notice given to the directors of such meeting. Such authority of the
Board of Directors is subject to the power of the shareholders to change or
repeal such Bylaws as prescribed by statute and subject to any other limitations
on such authority prescribed by statute.

                      THESE AMENDED BYLAWS WERE ADOPTED ON
                                  MAY 20, 1996
                   BY RESOLUTION OF THE BOARD OF DIRECTORS OF
                               ANGEION CORPORATION


                                        /s/ David L. Christofferson
                                        David L. Christofferson
                                        Secretary






                      [TEXT ON FACE OF ANGEION CORPORATION
                            COMMON STOCK CERTIFICATE]


[Certificate number]                                          [Number of shares]

              INCORPORATED UNDER THE LAWS OF THE STATE OF MINNESOTA
                               ANGEION CORPORATION

                                                                SEE REVERSE SIDE
                                                         FOR CERTAIN DEFINITIONS
                                                               CUSIP 03462H 10 7

THIS CERTIFIES THAT [blank]

is the owner of [blank]

FULLY PAID AND NON-ASSESSABLE SHARES OF COMMON STOCK, $.01 PAR
VALUE, OF

                               ANGEION CORPORATION

transferable on the books of the Corporation by the holder hereof in person or
by duly authorized attorney upon surrender of this certificate properly
endorsed. This certificate is not valid unless countersigned by the Transfer
Agent and Registrar.

         WITNESS the facsimile signatures of its duly authorized officers.

Dated:

  /s/ David L. Christofferson                         /s/ W.A. McFarlin
            Secretary                                   Chairman and CEO

- -  -  -  -  -  -   -   -   -   -   -   -   -   -   -   -   -   -   -   -   -   -

                         [TEXT ON RIGHT SIDE OF FACE OF
                  ANGEION CORPORATION COMMON STOCK CERTIFICATE]


Countersigned and Registered:
  NORWEST BANK MINNESOTA, N.A.
    Transfer Agent and Registrar


By
          Authorized Signature


                  [TEXT ON REVERSE SIDE OF ANGEION CORPORATION
                            COMMON STOCK CERTIFICATE]


         The Corporation will furnish to any shareholder upon request, made in
writing, and without charge a full statement of the designations, preferences,
limitations and relative rights of the shares of each class authorized to be
issued.

         This certificate also evidences and entitles the holder hereof to
certain Rights as set forth in the Rights Agreement between Angeion Corporation
(the "Company") and Norwest Bank Minnesota, N.A. (the "Rights Agent") dated as
of April 8, 1996 (the "Rights Agreement"), and as the same may be amended from
time to time, the terms of which are hereby incorporated herein by reference and
a copy of which is on file at the principal offices of the Company. Under
certain circumstances, as set forth in the Rights Agreement, such Rights will be
evidenced by separate certificates and will no longer be evidenced by this
certificate. The Company will mail to the holder of this certificate a copy of
the Rights Agreement, as in effect on the date of mailing, without charge
promptly after receipt of a written request therefor. Under certain
circumstances set forth in the Rights Agreement, Rights issued to, or held by,
any Person who is, was or becomes an Acquiring Person, an Adverse Person or any
Affiliate or Associate thereof (as such terms are defined in the Rights
Agreement), whether currently held by or on behalf of such Person or by any
subsequent holder, may become null and void.


The following abbreviations, when used in the inscription on the face of this
certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:

TEN COM - as tenants in common

TEN ENT - as tenants by entireties

JT TEN  -         as joint tenants with right of survivorship and not as
                  tenants in common

UTMA    - ___________ Custodian ___________
            (Cust)               (Minor)
                  under Uniform Transfer to Minors Act __________________
                                                            (State)

Additional abbreviations may also be used though not in the above list.


For value received __________ hereby sell, assign and transfer unto


PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF
ASSIGNEE [blank]

PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP
CODE OF ASSIGNEE

______________________________________________________________________ Shares of
the capital stock represented by the within Certificate, and do hereby
irrevocably constitute and appoint _______________________ Attorney to transfer
the said stock on the books of the within-named Corporation with full power of
substitution in the premises.

Dated                             ______________________________________________

                                  ______________________________________________

                                   NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST
                                   CORRESPOND WITH THE NAME AS WRITTEN UPON THE
                                   FACE OF THE CERTIFICATE IN EVERY PARTICULAR
                                   WITHOUT ALTERATION OR ENLARGEMENT OR ANY
                                   CHANGE WHATEVER.

SIGNATURE GUARANTEED







May 30, 1996



Angeion Corporation
3650 Annapolis Lane, Suite 170
Minneapolis, Minnesota  55447-5434

Re:      Angeion Corporation
         Registration Statement on Form S-3

Ladies and Gentlemen:

We have acted as counsel to Angeion Corporation, a Minnesota corporation (the
"Company"), in connection with the registration by the Company of 5,750,000
shares of the Company's Common Stock, $.01 par value (the "Shares"), including
750,000 Shares subject to the Underwriters' over-allotment option, pursuant to
the Company's Registration Statement on Form S-3 filed with the Securities and
Exchange Commission on May 31, 1996 (the "Registration Statement").

In acting as counsel for the Company and arriving at the opinions expressed
below, we have examined and relied upon originals or copies, certified or
otherwise identified to our satisfaction, of such records of the Company,
agreements and other instruments, certificates of officers and representatives
of the Company, certificates of public officials and other documents as we have
deemed necessary or appropriate as a basis for the opinions expressed herein.

In connection with our examination, we have assumed the genuineness of all
signatures, the authenticity of all documents tendered to us as originals, the
legal capacity of all natural persons and the conformity to original documents
of all documents submitted to us as certified or photostatic copies.

Based on the foregoing, and subject to the qualifications and limitations set
forth herein, it is our opinion that:

         1.       The Company has the corporate authority to issue the
                  Shares in the manner and under the terms set forth in the
                  Registration Statement.

         2.       The Shares have been duly authorized and, when issued,
                  delivered to and paid for by the Underwriters referred to
                  in the Registration Statement, will be validly issued,
                  fully paid and nonassessable.

We express no opinion with respect to laws other than those of the State of
Minnesota and the federal laws of the United States of America, and we assume no
responsibility as to the applicability thereto, or the effect thereon, of the
laws of any other jurisdiction.

We hereby consent to the filing of this opinion as Exhibit 5.1 to the
Registration Statement, to its use as part of the Registration Statement, and to
the use of our name under the caption "Legal Matters" in the Prospectus forming
a part of the Registration Statement.

We are furnishing this opinion to the Company solely for its benefit in
connection with the Registration Statement as described above. It is not to be
used, circulated, quoted or otherwise referred to for any other purpose. Other
than the Company, no one is entitled to rely on this opinion.

Very truly yours,



/s/ OPPENHEIMER WOLFF & DONNELLY





                                                                   Exhibit 23. 1

                        CONSENT OF INDEPENDENT AUDITORS



The Board of Directors
Angeion Corporation:

We consent to the use of our report included and incorporated by reference
herein and to the reference to our firm under the heading "Experts" in the
prospectus.


                                                      /s/ KPMG Peat Marwick LLP

Minneapolis, Minnesota
May 31, 1996




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