SHAREHOLDERS AGREEMENT


                                     between


                             WORLD HEART CORPORATION

                                       and

                            EDWARDS LIFESCIENCES LLC

                                       and

                         EDWARDS LIFESCIENCES (US) INC.

                                       and

                   THE SHAREHOLDERS OF WORLD HEART CORPORATION
                                IDENTIFIED HEREIN



                                   Dated as of

                                  June 30, 2000





<PAGE>


                             SHAREHOLDERS AGREEMENT


          SHAREHOLDERS  AGREEMENT (the "Agreement"),  dated as of June 30, 2000,
among World Heart Corporation,  an Ontario corporation ("World Heart"),  Edwards
Lifesciences LLC, a Delaware limited liability company ("Edwards LLC"),  Edwards
Lifesciences  (US) Inc., a Delaware  corporation  ("Edwards US") and Roderick M.
Bryden, Dr. Tofy Mussivand and the Ottawa Heart Institute  Research  Corporation
(the "Other Shareholders").

          WHEREAS (a) World Heart and Edwards LLC are parties to a  Contribution
Agreement, dated as of May 24, 2000 (the "Contribution Agreement") and the other
Transaction  Agreements  (as  defined in the  Contribution  Agreement),  and (b)
Edwards  US and World  Heart  are  parties  to a  Convertible  Preferred  Shares
Purchase  Agreement  dated  as of May  24,  2000  (the  "World  Heart  Preferred
Agreement") and upon consummation of the transactions  contemplated therein (the
"Transactions")  Edwards  LLC  will  hold  4,981,128  participating   cumulative
preferred shares (the "Newco Preferred Shares") of Valentine  Acquisition Corp.,
a Delaware corporation and a subsidiary of World Heart ("Newco"), and Edwards US
will hold 1,374,570 Cumulative Redeemable Convertible Preferred Shares, Series A
of World Heart (the "Series A Preferred Shares");

          WHEREAS  pursuant to the Exchange  Agreement  between  Edwards LLC and
World Heart dated as of May 24, 2000 (as defined in the Contribution  Agreement)
Edwards  LLC will have the right to  exchange  the Newco  Preferred  Shares  for
common  shares of World Heart  ("World  Heart  Common  Shares") on the terms and
conditions set out therein;

          WHEREAS the Series A Preferred Shares are convertible into World Heart
Common  Shares  at the times  and on the  terms  and  conditions  set out in the
articles of World Heart;

          WHEREAS  the  parties  hereto  wish  to  set  forth  their   agreement
concerning certain  governance matters of World Heart following  consummation of
the  Transactions as well as certain matters  relating to Edwards  ownership and
disposition of the World Heart Common Shares;

          NOW,  THEREFORE,   in  consideration  of  the  mutual  agreements  and
covenants  contained herein and for other good and valuable  consideration,  the
receipt and  sufficiency  of which are hereby  acknowledged,  the parties hereto
hereby agree as follows:

                                    ARTICLE I
                                   Definitions

          SECTION 1.1  Definitions.  As used in this  Agreement,  the  following
terms shall have the following meanings:

          "affiliate" has the meaning  specified in the Securities Act (Ontario)
as in effect on the date of this Agreement.

          "Agreement"  has  the  meaning  set  forth  in the  recitals  to  this
agreement.

          "Applicable Law" shall mean, with respect to any Person,  any statute,
law, regulation,  ordinance,  rule, judgment, rule of common law, order, decree,
award, Governmental Approval,  concession, grant, franchise, license, agreement,
directive,  guideline, policy, requirement, or other governmental restriction or
any similar form of decision of, or determination  by, or any  interpretation or
administration of any of the foregoing by, any Governmental  Authority,  whether
in  effect  as of the date  hereof or  thereafter  and in each case as  amended,
applicable to such Person or its subsidiaries or their respective assets.

          A Person shall be deemed to  "Beneficially  Own", to have  "Beneficial
Ownership" of, or to be "Beneficially  Owning" any securities  (which securities
shall also be deemed  "Beneficially  Owned" by such  Person) that such Person is
deemed to "beneficially own" within the meaning of Rule 13d-3 under the Exchange
Act as in effect on the date of this Agreement and, for certainty, Edwards shall
be deemed to  Beneficially  Own the World Heart Common Shares  issuable upon the
conversion  of the Series A Preferred  Shares and issuable  upon the exchange of
the Newco Preferred Shares;

          "Canadian   Securities  Acts"  shall  mean  the  Canadian   securities
legislation and Canadian  securities  directions set out in National  Instrument
14-101  adopted or made by the  securities  commissions  and similar  regulatory
authorities in the provinces of Canada;

          "Contribution  Agreement" has the meaning set forth in the recitals to
this Agreement.

          "Edwards" means, collectively, Edwards US and Edwards LLC.

          "Edwards Designee" means the Chief Executive Officer of Edwards LLC.

          "Edwards  LLC"  has the  meaning  set  forth in the  recitals  to this
Agreement.

          "Edwards  US"  has the  meaning  set  forth  in the  recitals  to this
Agreement.

          "Effective Date" means the date of the closing of the Transactions and
the transactions contemplated by the World Heart Preferred Agreement.

          "Exchange Act" means the Securities  Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder.

          "First Offer Price" has the meaning set forth in Section 3.2(a).

          "Governmental  Approval"  means  any  action,  order,   authorization,
consent, approval,  license, lease, ruling, permit, tariff, rate, certification,
exemption, filing or registration by or with any Governmental Authority.

          "Governmental Authority" means any government or political subdivision
thereof, governmental department,  commission, board, bureau, agency, regulatory
authority, instrumentality,  judicial or administrative body having jurisdiction
over the matter or matters in question.

          "Incentive Securities" has the meaning set forth in Section 4.1.

          "Losses" has the meaning set forth in Section 5.4.

          "Newco Preferred  Shares" has the meaning set forth in the preamble of
this Agreement.

          "Offered Shares" has the meaning set forth in Section 3.2(a)

          "Other Shareholders" has the meaning set forth in the recitals to this
Agreement.

          "Permitted Transferee" has the meaning set forth in Section 3.1.

          "Person" means any individual, group, corporation,  firm, partnership,
limited  liability  company,   joint  venture,   trust,   business  association,
organization, governmental entity or other entity.

          "POP System" means the prompt offering prospectus qualification system
established  under  the  Canadian  Securities  Acts  or  any  equivalent  system
established from time to time in Canada;

          "Public  Offering"  means any  offering of World Heart  Common  Shares
registered  under the  Securities  Act or  qualified  under any of the  Canadian
Securities Acts.

          "Response Period" has the meaning set forth in Section 3.2(b).

          "SEC" means the  Securities  and Exchange  Commission or any successor
governmental entity.

          "Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.

          "Series A Preferred  Shares" has the meaning set forth in the recitals
to this Agreement.

          "Transactions"  has the  meaning  set  forth in the  recitals  to this
Agreement.

          "Transfer Notice" has the meaning set forth in Section 3.2(a).

          "World  Heart"  has the  meaning  set  forth in the  recitals  to this
Agreement.

          "World Heart Board" means the board of directors of World Heart.

          "World Heart Common  Shares" has the meaning set forth in the recitals
to this Agreement.


                                   ARTICLE II
                              Corporate Governance

          SECTION II.1 The World Heart Board of Directors. This Article II shall
be effective for so long as Edwards  Beneficially Owns at least 10% of the World
Heart  Common  Shares  outstanding  on  a  fully  diluted  basis  and  does  not
Beneficially Own a majority of the Series A Preferred Shares.

          (a) Composition.  World Heart and the Other Shareholders  hereby agree
to take,  at any time and from time to time,  all  action  necessary  and within
their power such that the World Heart Board shall consist of not more than eight
directors.  Edwards  shall be  entitled to nominate  the  Edwards  Designee  for
election to the World Heart Board.

          (b) Removal.  Only Edwards shall be entitled to request the removal of
the Edwards  Designee.  If Edwards requests that the Edwards Designee be removed
(with or without  cause),  the Other  Shareholders  agree to take or cause to be
taken all  appropriate  action  within their power to effect the removal of such
director from the Board of Directors of World Heart.

          (c)  Vacancies.  In the event a vacancy is created on the World  Heart
Board by the  death,  disability,  retirement,  resignation  or  removal  of the
Edwards Designee (an "Edwards Vacancy"),  then as soon as practicable thereafter
Edwards shall designate a new Edwards Designee and the Other  Shareholders agree
to vote in favor of the new Edwards Designee to fill the Edwards Vacancy.

          (d)  Subsidiaries  and  Committees.   At  Edwards'  election,   unless
prohibited by applicable  stock exchange  rules or Applicable  Law, any board of
directors of any  subsidiary  of World Heart,  and any committee of the board of
directors of World Heart and such subsidiary shall include the Edwards Designee.

          SECTION II.2 General Covenant to Vote.

          (a) Each Other  Shareholder  agrees to take all actions  within  their
power  necessary at any time or from time to time to call,  or cause World Heart
or the  appropriate  officers or directors  of World Heart to call,  one or more
meetings  of  shareholders  of World Heart and to vote all  securities  of World
Heart  Beneficially  Owned or which  control or  direction  is exercised by such
Other  Shareholder  at any such meeting at which  directors are to be elected in
favor of, or to consent by written  consent in lieu of any such  meeting to, the
election of a Board of Directors  consistent  with,  and the taking of any other
action required by or to effect the intent of, this Agreement including, without
limiting the generality of the foregoing,  the election of the Edwards  Designee
as a director of World Heart.

          (b) World Heart  agrees to take all actions  necessary  at any time or
from  time to time to call,  or to cause  its  subsidiaries  or the  appropriate
officers or directors of its  subsidiaries  to call, one or more annual meetings
of  shareholders  of its  subsidiaries  and to vote all securities  Beneficially
Owned or over which control or direction is exercised by World Heart at any such
annual meeting in favor of, or to consent by written consent in lieu of any such
meeting to, the election of a board of directors consistent with, and the taking
of any other action required by or to effect the intent of, this Agreement.

                                   ARTICLE III
                              Transfer Restrictions

          SECTION  III.1  Restrictions  on World Heart Common  Shares.  If World
Heart enters into an agreement with  underwriters  pursuant to which World Heart
agrees to issue and sell World Heart  Common  Shares or  securities  convertible
into or carrying  the right to purchase  World Heart  Common  Shares in a Public
Offering and if Edwards is requested to do so by the lead  underwriter,  Edwards
will agree not to sell,  transfer or otherwise dispose of any World Heart Common
Shares for 90 days  following the  completion of World Heart's  Public  Offering
without  the prior  written  consent  of the  underwriters,  which  shall not be
unreasonably  withheld.  The  preceding  sentence  shall not  restrict  Edwards'
ability to sell securities concurrently with World Heart in such Public Offering
through such  underwriters.  So long as Edwards holds World Heart Common Shares,
Edwards shall not sell,  transfer or otherwise dispose of any World Heart Common
Shares except in accordance with Section 3.2 or one of the following:

          (a)  pursuant to a sale or sales to any one or more  Persons or groups
in an amount  that,  when  combined  with all other sales of World Heart  Common
Shares  effected  by  Edwards  in the  preceding  12 months  represents,  in the
aggregate,  no more than 25% of the World Heart Common Shares Beneficially Owned
by Edwards on a fully-diluted basis as of the Effective Date;

          (b) pursuant to a merger,  consolidation or other business combination
of  Edwards,  where  Edwards is not the  surviving  entity,  or a sale of all or
substantially all of Victoria's assets; provided, however, that the surviving or
purchasing  entity agrees in writing to be bound by the terms of this Agreement;
or

          (c) pursuant to a transfer of World Heart Common  Shares by Edwards to
an  affiliate  of Edwards,  from an  affiliate  of Edwards to Edwards or between
affiliates  of Edwards  (any such  transferee  shall be  referred to herein as a
"Permitted Transferee"), provided that in the case of any such transfer, Edwards
or a Permitted  Transferee,  as the case may be, shall have provided World Heart
with  written  notice of such  proposed  transfer  at least  five days  prior to
consummating  such  transfer  stating  the name  and  address  of the  Permitted
Transferee and the relationship between the transferring party and the Permitted
Transferee,  and the  Permitted  Transferee  shall have  executed a copy of this
Agreement as a shareholder of World Heart.  If any Permitted  Transferee to whom
World Heart  Common  Shares have been  transferred  pursuant to this Section 2.1
ceases to be a Permitted  Transferee,  such World Heart  Common  Shares shall be
transferred back to the transferor or another Permitted  Transferee  immediately
prior to the time such Person ceases to be a Permitted  Transferee.  Edwards and
any Permitted Transferee shall be jointly and severally liable for any breach of
this Agreement by such Permitted Transferee.

          SECTION III.2 Right of First Refusal.

          (a) If Edwards  receives  and  desires to accept a bona fide offer (an
"Offer") to purchase World Heart Common Shares representing more than 25% of the
World Heart Common Shares Beneficially Owned by Edwards on a fully-diluted basis
as of the  Effective  Date from any Person who is not an  affiliate  of Edwards,
Edwards shall give written notice (a "Transfer  Notice") to that effect to World
Heart.  The Transfer  Notice shall  contain (i) the number of World Heart Common
Shares proposed to be transferred (the "Offered  Shares"),  (ii) the identity of
the offeror  (the  "Offeror")  and (iii) the  purchase  price (the "First  Offer
Price") offered by the Offeror.

          (b) World  Heart  shall have the right,  for a period of 30 days after
the date of the Transfer Notice (the "Response Period"),  to purchase,  pursuant
to the Transfer  Notice,  all but not less than all of the Offered Shares at the
First Offer Price,  exercisable by delivering a written notice (the  "Acceptance
Notice") to Edwards within the Response Period.  The Acceptance  Notice shall be
deemed to be an  irrevocable  commitment  to  purchase  from  Edwards all of the
Offered Shares.

          (c) If, at the end of the Response Period, Edwards has not received an
Acceptance  Notice pursuant to terms of Section 3.2(b) Edwards shall be entitled
for a period of 90 days  beginning the day after the  expiration of the Response
Period to sell to the Offeror  the Offered  Shares at a price not lower than the
First  Offer  Price  and on terms no more  favorable  to the  Offeror  than were
contained in the Transfer Notice; provided, however, that if the market price of
the World Heart Common Stock has dropped since the date of the Transfer  Notice,
Edwards  shall be  entitled  to sell the  Offered  Shares  to the  Offeror  at a
correspondingly  reduced price. Promptly after any sale pursuant to this Section
3.2,  Edwards  shall  notify World Heart of the  consummation  thereof and shall
furnish such evidence of the completion  (including  time of completion) of such
sale and of the terms thereof as World Heart may reasonably request.

          (d) If,  at the end of any such  90-day  period  provided  for in this
Section 3.2,  Edwards has not completed the sale of the Offered Shares,  Edwards
shall no longer  be  permitted  to sell such  Offered  Shares  pursuant  to this
Section 3.2 without again fully  complying  with the  provisions of this Section
3.2 and all the restrictions on sale, transfer,  assignment or other disposition
contained in this Agreement shall again be in effect.

          SECTION III.3 Compliance with Applicable Law, Etc. The exercise of the
right of first  refusal  set  forth in  Section  3.2 and the  completion  of any
transfer or sale of World Heart Common Shares  contemplated  hereunder  shall be
subject to compliance with Applicable Law. Edwards,  World Heart and each of the
Other  Shareholders  shall  cooperate  with each  other and shall  take all such
action,  including,  without  limitation,  obtaining all Governmental  Approvals
required to comply with  Applicable Law in connection  with the sale or transfer
of the World Heart Common Shares  pursuant to this  Agreement.  Each of Edwards,
World Heart and the Other  Shareholders shall bear its own costs and expenses in
connection with obtaining any such Governmental  Approvals,  provided,  however,
that neither  Edwards nor the Other  Shareholders  shall be required to bear any
costs  or  expenses  in  order  for  another  shareholder  to  obtain  any  such
Governmental Approvals.

          SECTION III.4 Legends on Shares. Victoria agrees that the certificates
representing the Valentine Common Shares and the Newco Preferred Shares may bear
a legend referring to the transfer restrictions of this Article III.

          SECTION III.5 Effect.  Any  purported  transfer of securities  that is
inconsistent  with the provisions of this Article III shall be null and void and
of no force or effect and will not be registered on the share registers of World
Heart.

                                   ARTICLE IV
                  Preemptive Rights and Additional Stock Sales

          SECTION IV.1 Preemptive  Rights.  For so long as Edwards  Beneficially
Owns  at  least  10%  of  the  World  Heart  Common  Shares   outstanding  on  a
fully-diluted  basis,  Edwards  shall be entitled to  participate  in all future
issuances  by World  Heart of World  Heart  Common  Shares (or rights to acquire
World Heart Common Shares or securities  convertible  into, or exchangeable for,
or carrying  the right to  purchase  World  Heart  Common  Shares) to the extent
necessary to maintain its  proportionate  fully diluted equity interest in World
Heart as that  interest  exists at the time of such  issuance.  World Heart will
provide  Edwards  with at  least  20 days  advance  written  notice  of any such
proposed  issuance (a  "Proposed  Issuance"),  which  notice  shall  contain all
relevant  information  pertaining thereto (including,  without  limitation,  the
identity of the proposed  beneficial and record owners of the World Heart Common
Shares to be issued and sold by World Heart and the issue price per security, or
proposed  range of issue  prices per  security,  if then  known) and an offer to
Edwards to  participate  in the  Proposed  Issuance (at a price per security and
upon  terms and  conditions  no less  favorable  than  those  provided  to other
offerees or purchasers of World Heart Common Shares in the Proposed Issuance) to
the extent  necessary  for Edwards to maintain its  proportionate  fully diluted
equity interest in World Heart.  At Edwards' sole option,  it may participate in
the Proposed Issuance by purchasing the full number of World Heart Common Shares
necessary to maintain its  proportionate  equity  interest or any lesser  number
thereof.  In the event the terms of the Proposed  Issuance  change,  World Heart
will  provide  Edwards  with  a  new  20-day  advance  notice  period  prior  to
consummating  the  transaction  contemplated  by the  Proposed  Issuance.  These
preemptive  rights  shall not apply to the  following  sales or  issuances:  (a)
pursuant  to an employee  stock  option  plan,  stock  purchase  plan or similar
benefit  program,  agreement  or sale or issuance  to  directors,  employees  or
consultants  which sales or  issuances  do not exceed  20%,  on a fully  diluted
basis,  of the  outstanding  equity  shares of World Heart as of the date hereof
("Incentive  Securities");  or (b) as consideration for the acquisition by World
Heart  or any of its  affiliates  of all or a part of  another  business  or the
merger of any business entity with or into World Heart or any of its affiliates.

                                    ARTICLE V
                               Registration Rights

          SECTION V.1 Registration on Request.

          (a) Request. Upon the written request of Edwards requesting that World
Heart effect the  registration  under the Securities  Act and the  qualification
under the prospectus  requirements of any or all of the Canadian Securities Acts
of all or part of its World Heart  Common  Shares and  specifying  the  intended
method of disposition  thereof,  World Heart will,  subject to the terms of this
Agreement,  use its best efforts to effect the registration under the Securities
Act and the qualification under the prospectus requirements of any or all of the
Canadian  Securities Acts of the World Heart Common Shares which World Heart has
been so  requested  to  register  or  qualify  by  Edwards  for  disposition  or
distribution  in accordance  with the intended  method of disposition  stated in
such  request;  provided,  however,  that  Edwards  shall be  entitled to make a
request  under  this  Section  5.1 no more  than  three  times  unless  any such
registration  or  qualifications  requested  shall not have been effected as set
forth in 5.1(d) below.

          (b) Registration  Statement and Prospectus Form.  Registrations  under
the  Securities  Act  under  this  Section  5.1  shall  be on  such  appropriate
registration  form of the SEC as shall be selected  by Edwards and World  Heart.
If, in connection with any  registration  under the Securities Act under Section
5.1(a)  which is proposed by World Heart to be on Form F-3 or any similar  short
form  registration  statement  which is a successor  to Form F-3,  the  managing
underwriters,  if any, shall advise World Heart in writing that in their opinion
the use of another  permitted  form is of material  importance to the success of
the offering,  then such registration shall be on such other permitted form. If,
at the time a request  is made by  Edwards  under  Section  5.1(a) to  qualify a
distribution  of World Heart  Common  Shares in some or all of the  provinces of
Canada,  World Heart has in force a receipt for its annual information form from
the applicable Canadian provincial securities  regulatory  authorities in all of
the  provinces  in which  the  distribution  is to be  effected  and  meets  the
eligibility  criteria  to be a POP System  issuer,  World  Heart will effect the
qualification by way of a short form prospectus pursuant to the POP System.

          (c)  Expenses.  World  Heart will pay all  Registration  Expenses  (as
defined in Section 5.2(d)) in connection with any  registration or qualification
requested pursuant to this Section 5.1 by Edwards.

          (d) Effective Registration  Statement. A registration or qualification
requested pursuant to this Section 5.1 shall not be deemed to have been effected
(i) unless a registration statement with respect thereto has become effective or
a (final)  prospectus  has been filed and a receipt  issued  therefor  under the
applicable   Canadian   Securities   Acts,   provided  that  a  registration  or
qualification  which does not become  effective  after  World  Heart has filed a
registration  statement or a preliminary  prospectus with respect thereto solely
by reason of the refusal to proceed of  Edwards(other  than a refusal to proceed
based upon the  advice of counsel  relating  to a matter  with  respect to World
Heart)  shall be deemed to have been  effected  by World Heart at the request of
Edwards  unless Edwards shall have elected to pay all  Registration  Expenses in
connection with such registration,  (ii) if, after it has become effective, such
registration  statement or  distribution  of World Heart Common  Shares  becomes
subject to any stop order,  cease  trading  order,  injunction or other order or
requirement of the SEC or applicable Canadian provincial  securities  regulatory
authority  or other  governmental  agency or court for any reason  other than by
reason of some act or omission  by, or  circumstance  relating to,  Edwards,  or
(iii)  the  conditions  to  closing  specified  in  the  purchase  agreement  or
underwriting agreement entered into in connection with such registration are not
satisfied,  other than by reason of some act or  omission  by, or  circumstances
relating to, Edwards.

          (e)  Selection  of  Underwriters.   If  a  requested  registration  or
qualification  pursuant to this Section 5.1 involves an  underwritten  offering,
the managing underwriter or underwriters thereof shall be selected by Edwards on
reasonable prior notice to World Heart.

          SECTION V.2  Incidental  Registration.  If World Heart proposes at any
time to register  World Heart Common Shares under the Securities Act (other than
pursuant to a  registration  statement  on Form S-8,  Form S-4 or Form F-4 (or a
similar  successor  form)) or to file a  prospectus  under  any of the  Canadian
Securities  Acts in respect of a proposed  distribution  of World  Heart  Common
Shares with  respect to an offering  of World  Heart  Common  Shares for its own
account or for the account of any of its security holders, it will promptly (but
in no event less than 30 days before the anticipated  filing date), give written
notice  thereof to Edwards  and offer  Edwards  the  opportunity  to register or
distribute such number of World Heart Common Shares as Edwards may request. Upon
the written request of Edwards made within 30 days after the receipt of any such
notice (which request shall specify the World Heart Common Shares intended to be
disposed of by Edwards and the intended  method of disposition  thereof),  World
Heart  will,  subject to the terms of this  Agreement,  use its best  efforts to
include the World Heart  Common  Shares  which  Edwards  has been  requested  to
register in such registration or qualify for distribution.

          (a) If the  proposed  registration  by World Heart is an  underwritten
Public Offering of World Heart Common Shares, then World Heart will use its best
efforts to cause the managing  underwriter or underwriters to include such World
Heart Common Shares among those  securities to be distributed by or through such
underwriters  (on the same terms and  conditions as the other World Heart Common
Shares  included  therein  to  the  extent  appropriate).   Notwithstanding  the
foregoing,  if in  the  reasonable  judgment  of  the  managing  underwriter  or
underwriters,  the success of the Public Offering would be adversely affected by
inclusion of the World Heart Common Shares requested to be included, World Heart
shall include in such  registration or distribution the number (if any) of World
Heart Common  Shares so requested to be included  which,  in the opinion of such
underwriters, can be sold.

          (b) If, at any time after giving  written  notice of its  intention to
register a Public  Offering and prior to the effective date of the  registration
statement or the filing of a (final)  prospectus  filed in connection  with such
registration or distribution,  World Heart shall determine for any reason either
not to register, or to delay registration of, or cease the distribution of, such
securities,  World  Heart may,  at its  election,  give  written  notice of such
determination to Edwards and, thereupon,  (i) in the case of a determination not
to register or  distribute,  shall be relieved of its obligation to register any
World  Heart  Common  Shares  or  qualify  any World  Heart  Common  Shares  for
distribution  or (ii) in the case of a  determination  to delay  registering  or
filing a  prospectus  to qualify a  distribution,  shall be  permitted  to delay
registering  or qualifying for  distribution  any of Edwards' World Heart Common
Shares,  for the same period as the delay in registering  such other World Heart
Common Shares.

          (c) The selection of the  underwriters  for any such offering shall be
at the sole discretion of World Heart.

          (d) World Heart will pay expenses associated with the registration and
sale of Edwards' World Heart Common Shares including  without  limitation legal,
accounting,  printing,  prospectus filing and distribution fees and expenses but
excluding  underwriters'  fees,  commissions  or discounts with respect to World
Heart Common Shares disposed of by Edwards ("Registration Expenses").

          SECTION V.3 Registration Procedures.

          (a) If and  whenever  World  Heart is required  by the  provisions  of
Section 5.1 or 5.2 hereof to effect the registration or qualify the distribution
of World Heart Common Shares, World Heart will as promptly as practicable:

                    (i) furnish to Edwards  such number of  conformed  copies of
          such preliminary prospectus,  prospectus or registration statement and
          of each such amendment and supplement  thereto (in each case including
          all  exhibits,  if any),  such  number  of  copies  of the  prospectus
          included  in  any  such   registration   statement   (including   each
          preliminary prospectus and any summary prospectus), in conformity with
          the requirements of the Securities Act, such documents incorporated by
          reference in such registration statement or prospectus, and such other
          documents,  as  Edwards  may  reasonably  request  to  facilitate  the
          disposition of World Heart Common Shares owned by Edwards;

                    (ii)  use its  best  efforts  to  register  or  qualify  the
          securities  covered by such  registration  statement  under such state
          securities or blue sky laws of such jurisdictions,  if applicable,  as
          shall be reasonably  appropriate  for  distribution of the World Heart
          Common  Shares;  provided,  however,  that  World  Heart  shall not be
          required,  solely in order to accomplish the foregoing,  to qualify to
          do  business as a foreign  corporation  in any  jurisdiction  where it
          would not otherwise be required to qualify, subject itself to taxation
          in any such  jurisdiction  or consent to general service of process in
          any such jurisdiction;

                    (iii) advise Edwards, promptly after it shall receive notice
          or obtain  knowledge  thereof,  of the  issuance of any cease  trading
          order by any Canadian provincial  securities  regulatory  authority or
          any stop order by the SEC or any state securities commission or agency
          preventing  the  distribution  by  Edwards of its World  Heart  Common
          Shares or suspending the effectiveness of such registration  statement
          or the  initiation or  threatening  of any proceeding for that purpose
          and use its best efforts to prevent the issuance of any cease  trading
          or stop order and to obtain its  withdrawal  if such cease  trading or
          stop order should be issued;

                    (iv) notify  Edwards upon World Heart's  discovery  that, or
          upon the  happening of any event as a result of which any  preliminary
          prospectus or prospectus prepared in connection with a distribution of
          Edwards'  World Heart  Common  Shares or included in any  registration
          statement which includes  Edwards' World Heart Common Shares,  as then
          in effect, includes an untrue statement of a material fact or omits to
          state any material fact required to be stated  therein or necessary to
          make  the   statements   therein  not   misleading  in  light  of  the
          circumstances then existing, and at the request of Edwards prepare and
          furnish to Edwards a reasonable number of copies of a supplement to or
          an  amendment  of such  prospectus  as may be  necessary  so that,  as
          thereafter  delivered to the purchasers of Edwards' World Heart Common
          Shares,  such  prospectus  shall not include an untrue  statement of a
          material  fact or omit to state a material  fact required to be stated
          therein or necessary to make the statements  therein not misleading in
          light of the circumstances then existing; and

                    (v) use its best  efforts  to cause  all of the  outstanding
          World Heart Common Shares to continue to be listed on each  securities
          exchange  or  inter-dealer  quotation  system on which the World Heart
          Common Shares are now listed or posted for trading.

          (b) Edwards  agrees that,  upon receipt of any notice from World Heart
of the occurrence of any event of the kind described in Section  5.3(a)(iv),  it
will forthwith discontinue the disposition of World Heart Common Shares pursuant
to the prospectus or registration  statement relating to such World Heart Common
Shares  until its receipt of a  supplemented  or amended  prospectus  from World
Heart;  provided,  that if the  registration  statement  is for an  underwritten
Public  Offering,  Edwards  will use its  reasonable  best  efforts to cause the
underwriters  of such Public  Offering to discontinue  the  disposition of World
Heart Common Shares.

          (c) If any of Edwards'  World Heart Common  Shares are included in any
registration  or  qualification  pursuant to this Article V, Edwards  shall take
such actions and furnish World Heart with such information  regarding itself and
relating to the distribution of the World Heart Common Shares as World Heart may
from time to time reasonably request and as shall be required in connection with
any  registration,  qualification  or compliance  referred to in this Agreement,
including,  without  limitation,  the  following:  (i) enter into an appropriate
underwriting  agreement  containing  terms  and  provisions  then  customary  in
agreements of that nature and cause each  underwriter  of the World Heart Common
Shares  to be sold to agree in  writing  with  World  Heart to  provisions  with
respect  to  indemnification  that are  substantially  the same as set  forth in
Section 5.4 hereof; (ii) enter into such custody agreements,  powers of attorney
and related  documents at such time and on such terms and conditions as may then
be customarily  required in connection with such offering;  and (iii) distribute
the World  Heart  Common  Shares  in  accordance  with and in the  manner of the
distribution   contemplated  by  the  applicable   registration   statement  and
prospectus.

          SECTION V.4 Indemnification.

          (a)  Indemnification  by World Heart. In the event of any registration
or qualification for distribution of Edwards' World Heart Common Shares pursuant
to Section 5.1 or 5.2, World Heart agrees to indemnify and hold harmless Edwards
and its  directors  and  officers  and each other  person,  if any, who controls
Edwards within the meaning of the Securities Act (each, an "Indemnified Person")
from and against any and all losses, claims,  damages,  liabilities and expenses
(including  reasonable attorneys' fees and costs of investigation) to which such
Indemnified  Person  becomes  subject  under the  Securities  Act,  the Canadian
Securities  Acts or otherwise (the  "Losses"),  insofar as such losses,  claims,
damages,  liabilities  or expenses arise out of or are based upon (i) any untrue
statement  or  alleged  untrue  statement  of  material  fact  contained  in any
prospectus or registration statement under which such securities were registered
or  qualified  under  the  Securities  Act,  the  Canadian  Securities  Acts  or
otherwise,  any preliminary  prospectus,  final prospectus or summary prospectus
included therein,  or any amendment or supplement  thereto, or (ii) any omission
or alleged  omission  to state  therein a material  fact  required  to be stated
therein or necessary to make the  statements  therein not  misleading,  provided
that World Heart shall not be liable to such Indemnified Person in any such case
to the  extent  that any such  loss,  claim,  damage,  liability  (or  action or
proceeding  in respect  thereof)  or  expense  arises out of or is based upon an
untrue  statement or alleged  untrue  statement or omission or alleged  omission
made in such  registration  statement,  any such preliminary  prospectus,  final
prospectus, summary prospectus,  amendment or supplement in reliance upon and in
conformity  with  information  furnished  in writing  by Edwards to World  Heart
exclusively for use therein.

          (b)  Indemnification  by Edwards.  In the event of any registration or
qualification for distribution of Edwards' World Heart Common Shares pursuant to
Section 5.1 or 5.2,  Edwards  agrees to indemnify and hold harmless  World Heart
and its directors and officers and each other person, if any, who controls World
Heart within the meaning of the Securities Act (each, an  "Indemnified  Person")
from and  against any and all  Losses,  insofar as such  Losses  arise out of or
based upon (i) any untrue statement or alleged untrue statement of material fact
contained  in  any  prospectus  or  registration   statement  under  which  such
securities  were  registered or qualified under the Securities Act, the Canadian
Securities Acts or otherwise,  any preliminary  prospectus,  final prospectus or
summary prospectus  included therein, or any amendment or supplement thereto, or
(ii) any omission or alleged  omission to state therein a material fact required
to be stated therein or necessary to make the statements  therein not misleading
if such statement or omission was made solely in reliance upon and in conformity
with information  furnished in writing to World Heart by Edwards exclusively for
use in the preparation of such registration  statement,  preliminary prospectus,
final prospectus, summary prospectus, amendment or supplement.

          (c)  Defense of Claim.  If any  action or  proceeding  (including  any
governmental  investigation)  shall be brought  or  directed  against  any party
hereto  (or  its  officers,   directors  or  agents),  the  party  against  whom
indemnification is sought shall be permitted to (or, if requested, shall) assume
the defense of such claim,  including the  employment of counsel and the payment
of all  expenses,  unless a conflict of interest  may exist with respect to such
claim or differing or  additional  defenses may be available to the other party.
If defense of a claim is assumed by an indemnifying party, the indemnified party
shall not be liable for any  settlement of such action or  proceedings  effected
without  their prior  written  consent.  Any such  indemnifying  party shall not
consent to entry of any  judgment  or enter into any  settlement  which does not
include as an unconditional term thereof the giving by the claimant or plaintiff
to the indemnified party an unconditional  release from all liability in respect
to such claim or  litigation.  Any party entitled to  indemnification  hereunder
agrees to give prompt written notice to the other party of any written notice of
the  commencement of any action,  suit,  proceedings or  investigation or threat
thereof for which such party may claim  indemnification or contribution pursuant
to this Agreement; provided, however, that failure to give such notice shall not
limit  any  party's  right  to   indemnification   or  contribution   hereunder.
Notwithstanding the foregoing,  an indemnified party hereunder shall always have
the right to employ  separate  counsel in any such action and to  participate in
the defense  thereof,  but the fees and expenses of such counsel shall be at the
expense of such indemnified party.

          (d) Survival.  The  indemnification  provided for under this Agreement
will remain in full force and effect regardless of any investigation  made by or
on behalf of the  indemnified  party or any  officer,  director  or  controlling
Person of such  indemnified  party,  (ii) survive the transfer of securities and
(iii) survive the termination of this Agreement.

          (e) Right of Contribution. If the indemnification provided for in this
Section 5.4 is unavailable to, or insufficient to hold harmless,  an indemnified
party  under  Section  5.4(a) or Section  5.4(b)  above in respect of any Losses
referred to in such Sections, then each applicable indemnifying party shall have
an obligation  to  contribute to the amount paid or payable by such  indemnified
party as a result of such Losses in such proportion as is appropriate to reflect
the  relative  fault of World  Heart,  on the one hand,  and of Edwards,  on the
other,  in connection  with the  misstatement or omission which resulted in such
Losses,  taking into account any other relevant  equitable  considerations.  The
amount  paid or payable by a party as a result of the Losses  referred  to above
shall be deemed to  include,  subject  to the  limitations  set forth in Section
5.4(c) above,  any legal or other fees or expenses  reasonably  incurred by such
party in connection with any  investigation,  lawsuit or legal or administrative
action or proceeding.

                                   ARTICLE VI
                                   Termination

          SECTION VI.1 Termination. This Agreement shall automatically terminate
on the date Edwards longer Beneficially Owns any World Heart Common Shares.

                                   ARTICLE VII
                                  Miscellaneous

          SECTION VII.1  Effectiveness.  This Agreement shall be effective as of
the Effective Date.

          SECTION  VII.2  Governing  Law. This  agreement  shall be governed by,
interpreted  under,  and construed in  accordance  with the internal laws of the
Province  of  Ontario  and  each  party  hereby  attorns  to  the  non-exclusive
jurisdiction  of the courts of such  province  and any courts  competent to hear
appeals therefrom.

          SECTION  VII.3  Notices.  All notices,  demands,  requests,  consents,
approvals or other communications required or permitted to be given hereunder or
which are given with respect to this Agreement  shall be in writing and shall be
delivered  (charges  prepaid,  receipt confirmed or return receipt requested (if
available)) by hand, by nationally  recognized air courier service, by certified
mail or facsimile, addressed as set forth below or to such other address as such
party shall have  specified  most  recently by written  notice.  Notice shall be
deemed given and effective (i) if delivered by hand or by nationally  recognized
courier service,  when delivered at the address specified in this Section 7.3 or
in accordance with the latest unrevoked written direction from such party), (ii)
if by certified  mail,  upon  mailing or (iii) if given by  facsimile  when such
facsimile is transmitted to the fax number  specified in this Section 7.3 (or in
accordance  with the  latest  unrevoked  written  direction  from  such  party),
provided the appropriate confirmation is received.

           (a)       if to Edwards, to:

                           Edward Lifesciences (US) Inc.
                           Edwards Lifesciences LLC
                           One Edwards Way
                           Irvine, California 92614

                           Attention:   Associate General Counsel
                           Fax:  (949) 250-2525

                           with a copy (which shall not constitute notice) to:

                           Skadden, Arps, Slate, Meagher & Flom LLP
                           300  South Grand Avenue, Suite 3400
                           Los Angeles, California  90071

                           Attention: Joseph J. Giunta, Esq.
                           Fax:  (213) 687-5600


             (b)     if to World Heart, to:

                           World Heart Corporation
                           1 Laser Street
                           Nepean, Ontario
                           K2E 7V1

                           Attention:   Chief Financial Officer
                           Fax:  (613) 226-4744

                           with a copy (which shall not constitute notice) to:

                           McCarthy Tetrault
                           The Chambers
                           1400 - 40 Elgin Street
                           Ottawa, Ontario KlP 5K6

                           Attention: Robert D. Chapman
                           Fax: (613) 563-9386

          SECTION  VII.4  Interpretation.  When a  reference  is  made  in  this
Agreement  to a Section,  Schedule  or  Exhibit,  such  reference  shall be to a
Section,  Schedule or Exhibit of this Agreement unless otherwise indicated. When
a reference is made in this  Agreement to a specific  Schedule,  such  reference
shall be deemed to include,  to the extent applicable,  all the other Schedules.
The table of  contents,  table of  definitions  and  headings  contained in this
Agreement  are for  reference  purposes only and shall not affect in any way the
meaning  or  interpretation  of this  Agreement.  When the words  "includes"  or
"including" are used in this  Agreement,  they shall be deemed to be followed by
the  words  "without  limitation."  All  accounting  terms not  defined  in this
Agreement shall have the meanings  determined by generally  accepted  accounting
principles  as of the date hereof.  All  capitalized  terms  defined  herein are
equally applicable to both the singular and plural forms of such terms.

          SECTION VII.5  Severability.  In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstances, is
held  invalid,  illegal or  unenforceable  in any respect  for any  reason,  the
parties shall negotiate in good faith with a view to the  substitution  therefor
of a suitable  and  equitable  solution  in order to carry out, so far as may be
valid and  enforceable,  the  intent  and  purpose  of such  invalid  provision;
provided,  however,  that the validity,  legality and enforceability of any such
provision  in every other  respect  and of the  remaining  provisions  contained
herein shall not be in any way impaired  thereby,  it being intended that all of
the rights and  privileges  of the parties  hereto shall be  enforceable  to the
fullest extent permitted by law.

          SECTION VII.6  Counterparts.  This Agreement may be executed in one or
more  counterparts,  each of which shall be deemed an original  and all of which
shall,  taken  together,  be  considered  one and the same  agreement,  it being
understood that both parties need not sign the same counterpart.

          SECTION VII.7 Entire  Agreement;  No Third Party  Beneficiaries.  This
Agreement  together  with the Other  Transaction  Agreements  (as defined in the
Contribution  Agreement) and the World Heart Preferred  Agreement (a) constitute
the entire agreement and supersede all prior agreements and understandings, both
written and oral,  among the parties with respect to the subject  matter  hereof
and (b) is not  intended  to confer  upon any  Person,  other  than the  parties
hereto, any rights or remedies hereunder.

          SECTION VII.8 Further Assurances.  Each party shall execute,  deliver,
acknowledge  and file such other  documents and take such further actions as may
be  reasonably  requested  from time to time by the other  party  hereto to give
effect to and carry out the transactions contemplated herein.

          SECTION VII.9 Amendments and Modifications; Waivers and Extensions.

          (a) No provision of this  Agreement may be amended or modified  unless
such  amendment or  modification  is in writing and signed by the parties hereto
intending to be bound thereby;

          (b) Any party to this Agreement may waive any right, breach or default
which such party has the right to waive;  provided  that such waiver will not be
effective  against the waiving party unless it is in writing,  is signed by such
party, and specifically refers to this Agreement. Waivers may be made in advance
or after the right  waived  has  arisen or the  breach  or  default  waived  has
occurred.  Any  waiver  may be  conditional.  No  waiver  of any  breach  of any
agreement  or  provision  herein  contained  shall be  deemed  a  waiver  of any
preceding or succeeding  breach thereof nor of any other  agreement or provision
herein  contained.  No  failure  or  delay in  exercising  any  right,  power or
privilege  hereunder  shall  be  deemed a waiver  or  extension  of the time for
performance  of any other  obligations  or acts nor shall any  single or partial
exercise  thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege.

          SECTION  VII.10  Assignment.  Neither  this  Agreement  nor any of the
rights or  obligations  hereunder  shall be  assigned  by either of the  parties
hereto  without the prior  written  consent of the other party,  except that (a)
either party may assign all its rights and obligations to the assignee of all or
substantially  all of the assets of such party including an acquisition  through
merger,  provided  that  such  party  shall  in no event  be  released  from its
obligations  hereunder  without the prior written consent of the other party and
(b) Edwards may assign all of its rights and  obligations to a transferee of the
Series A Preferred  Shares or Newco Preferred Shares who, after giving effect to
the transfer  Beneficially  Owns at least 10% of the World Heart  Common  Shares
then outstanding on a fully-diluted basis, and who agrees in writing to be bound
by the terms of this  Agreement  provided  that the rights of Edwards in Section
5.1(a) may only be assigned to a single Person or a group of Persons that agrees
to act jointly in exercising such rights and provided further that the rights of
Edwards in Section 2.1 may not be assigned.  Subject to the preceding  sentence,
this Agreement will be binding upon,  inure to the benefit of and be enforceable
by the  parties and their  respective  successors  and  assigns.  Any  attempted
assignment in contravention hereof shall be null and void.

          SECTION  VII.11  Equitable  Remedies.  The parties  hereto  agree that
irreparable  damage would occur in the event that any of the  provisions of this
Agreement  were not performed in accordance  with their  specific  terms or were
otherwise  breached.  It is accordingly  agreed that the parties hereto shall be
entitled to equitable relief, including in the form of injunctions,  in order to
enforce specifically the provisions of this Agreement,  in addition to any other
remedy to which they are entitled at law or in equity.

          SECTION VII.12 Remedies  Cumulative.  The remedies provided for herein
shall be cumulative  and shall not preclude the assertion by any party hereto of
any other  rights or the seeking of any other  remedies  against the other party
hereto.

<PAGE>

          IN WITNESS WHEREOF,  the parties have caused this Agreement to be duly
executed and delivered, all as of the date first set forth above.

                                   EDWARDS LIFESCIENCES LLC


                                   By: /s/ Michael A. Mussallem
                                      ------------------------------------------
                                      Name:    Michael A. Mussallem
                                      Title:   President and Chief Executive
                                                  Officer

                                    EDWARDS LIFESCIENCES (US) INC.

                                    By: /s/ Michael A. Mussallem
                                       -----------------------------------------
                                       Name:    Michael A. Mussalem
                                       Title:   President

                                     WORLD HEART CORPORATION

                                     By: /s/ Roderick M. Bryden
                                        ----------------------------------------
                                        Name:    Roderick M. Bryden
                                        Title:   President and Chief Executive
                                                   Officer

                                      OTTAWA HEART INSTITUTE
                                      RESEARCH CORPORATION

                                      By:
                                         ---------------------------------------
                                         Name:
                                         Title:

                                      RODERICK M. BRYDEN

                                      /s/   Roderick M. Bryden
                                         ---------------------------------------


                                       DR. TOFY MUSSIVAND

                                      /s/  Dr. Tofy Mussivand
                                          --------------------------------------



<PAGE>

                                TABLE OF CONTENTS
                                                                            Page
ARTICLE I Definitions.........................................................1
   SECTION I.1 Definitions....................................................1
ARTICLE II Corporate Governance...............................................4
   SECTION II.1 The World Heart  Board of Directors...........................4
   SECTION II.2 General Covenant to Vote......................................5
ARTICLE III Transfer Restrictions.............................................5
   SECTION III.1  Restrictions on World Heart Common Shares...................5
   SECTION III.2  Right of First Refusal......................................6
   SECTION III.3  Compliance with Applicable Law, Etc.........................7
   SECTION III.4  Legends on Shares...........................................7
   SECTION III.5   Effect.....................................................7
ARTICLE IV Preemptive Rights and Additional Stock Sales.......................7
   SECTION IV.1  Preemptive Rights............................................7
ARTICLE V Registration Rights.................................................8
   SECTION V.1  Registration on Request.......................................8
   SECTION V.2  Incidental Registration.......................................9
   SECTION V.3  Registration Procedures......................................10
   SECTION V.4  Indemnification..............................................12
ARTICLE VI Termination.......................................................14
   SECTION VI.1  Termination.................................................14
ARTICLE VII Miscellaneous....................................................14
   SECTION VII.1  Effectiveness..............................................14
   SECTION VII.4  Interpretation.............................................16
   SECTION VII.5  Severability...............................................16
   SECTION VII.6  Counterparts...............................................16
   SECTION VII.7  Entire Agreement; No Third Party Beneficiaries.............16
   SECTION VII.8  Further Assurances.........................................16
   SECTION VII.9  Amendments and Modifications; Waivers and Extensions.......17
   SECTION VII.10 Assignment.................................................17
   SECTION VII.11 Equitable Remedies.........................................17
   SECTION VII.12 Remedies Cumulative........................................18