DISTRIBUTION AGREEMENT

                                     between

                             WORLD HEART CORPORATION

                                       and

                            EDWARDS LIFESCIENCES LLC

                                      dated

                                  June 30, 2000



<PAGE>

          This  Agreement  is made  effective  as of the 30th day of June,  2000
("Effective  Date"),  by and between  World  Heart  Corporation,  a  corporation
organized and existing  under the laws of the Province of Ontario and located at
1 Laser Street, Nepean, Ontario K2E 7V1 ("World Heart") and Edwards Lifesciences
LLC,  a  limited  liability  company  organized  under  the laws of the State of
Delaware,  located  at One  Edwards  Way,  Irvine,  CA 92614  ("Distributor"  or
"Edwards").

          WHEREAS,  World Heart and its subsidiaries are engaged in the business
of developing, manufacturing, and marketing medical devices and desires that the
sale and use of its products be actively promoted worldwide; and

          WHEREAS,  World Heart and its subsidiaries  have developed or acquired
heart  assist and  replacement  products  (the  "Heart  Assist  and  Replacement
Products" or the "Products"), as further described in Exhibit A hereto; and

          WHEREAS, Edwards is a well-known company in the medical devices field,
with  experience  and expertise in the  commercialization  and  distribution  of
medical devices; and

          WHEREAS, Edwards is an organization capable of commercializing medical
devices, such as the Products; and

          WHEREAS, World Heart desires to engage Edwards and its subsidiaries to
purchase,  resell,  distribute  and support the Products  worldwide,  subject to
specified restrictions; and

          WHEREAS,  Edwards  desires  to  obtain  rights  to  purchase,  resell,
distribute and support the Products in exchange for World Heart's  assumption of
specified obligations;

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


I.       Appointment

          A. Subject to the terms and  conditions  contained in this  Agreement,
World Heart  hereby  appoints  Edwards as World  Heart's  and its  subsidiaries'
exclusive independent  distributor of Products worldwide.  World Heart shall not
appoint any other agents,  representatives,  or distributors  for the purpose of
selling the Products,  nor shall it sell or distribute the Products directly, by
itself or through any  subsidiary or  affiliate,  except in the United States as
provided herein.

          B.  Edwards'  exclusive   distribution  rights,  as  defined  in  this
Agreement,  shall extend to improvements  and/or derivative  replacements to the
Products  and to related  products  developed  or acquired by World Heart or its
subsidiaries from inception of this Agreement.

          C. Edwards shall not sell any devices which directly  compete with the
Products  during  the term of this  Agreement.  Notwithstanding  the  foregoing,
however, Edwards may sell medical devices,  including without limitation,  heart
assist  devices so long as they do not directly  compete with the Products,  and
all other  medical  devices  (other  than as set forth in Exhibit A) which it is
selling as of the Effective Date.

          D. Edwards shall have the right to contract with third parties to sell
the Products on behalf of Edwards in  territories  outside of the United  States
where Edwards' own products are sold by such third party distributors.

          E. Subject to the terms and  conditions  contained in this  Agreement,
Edwards shall be entitled to identify itself as the distributor on the Products'
labeling and other manufacturing materials.

          F. In addition to the distribution rights granted herein, in the event
of any  transfer of the World Heart  business or any of the  Products to a third
party,  Edward's  rights to distribute the Products  under this Agreement  shall
survive  such  transfer,  subject  only to  approval  of  Edwards,  in its  sole
discretion.

II.      Obligations of Distributor

          A. Edwards shall use  commercially  reasonable  efforts to perform its
specified  distribution  obligations as described in this Agreement,  and shall,
among other requirements:

               1.  Promote  the  sale and use of  Products  in all  markets  and
territories  other than the United  States in which (a) such  Products have been
approved by all  appropriate  legal and  regulatory  authorities  for commercial
sale,  and (b)  Edwards  sells its own  products.  Edwards  shall have  absolute
discretion  with respect to what,  if any,  efforts it shall make to promote the
sale  and use of the  Products  in each  market  or  territory  not  covered  in
paragraph  (a) and (b) above.  If Edwards is  unwilling or unable to promote the
sale and use of the Products in any market or territory,  World Heart shall have
absolute  discretion  with  respect  to the sale and use of the  Product in each
market or territory  and such efforts by World Heart shall not be subject to the
terms and conditions of this Agreement;

               2. Purchase and maintain appropriate inventories of Products;

               3.  Provide  its  customers  with  support  with  respect  to the
Products,  including without  limitation,  troubleshooting of technical problems
and assistance for patients with respect to proper setup of equipment;

               4. Provide  customer  service,  including  responding to customer
inquiries,  requests for quotes on Product  pricing and  complaints  on a timely
basis and providing such assistance and information as is reasonably requested;

               5. Provide  invoices to customers and manage accounts  receivable
and collection  responsibilities for sales by Edwards of the Products during the
term of Agreement;

               6. Process and return any  defective  Products to World Heart for
credit or replacement, as Edwards shall determine;

               7. Process and return to World Heart,  at World Heart's  expense,
explants  reasonably  available  to  Edwards  for  clinical  study or for  other
purposes  reasonably  requested  by World  Heart.  World Heart  shall  reimburse
Edwards  for  all  costs  incurred  in  obtaining,  preparing,  decontaminating,
shipping and other processing of any such explanted devices;

               8. Meet with World  Heart at least  twice  annually,  or at World
Heart's  request,  more  frequently,  in order to discuss  sales  opportunities,
current market trends and to keep World Heart  informed of pertinent  events and
competing products having an impact upon the Product's marketability,  including
but not limited to, forecasts as to future sales;

               9. Cooperate  with World Heart in World Heart's  marketing and in
the conversion of market positioning into customer relationships and orders.

               10.  Maintain,   at  its  own  expense,  such  office  space  and
facilities,  and hire and train such personnel,  as may be required to carry out
its obligations under this Agreement; and

               11. Comply with all applicable  requirements  in the countries in
which Products are sold relating to the reporting of adverse reactions  suffered
by end users of Products,  and will promptly  report all such instances to World
Heart,  specifying the date, time, and nature of the occurrence,  the customer's
name and address,  the Products  (including  batch number if available)  and any
other relevant information reasonably available to Edwards which World Heart may
reasonably request.

          B. At Edwards' option,  Edwards may use World Heart's sales materials,
or develop promotional  literature,  including product brochures and other sales
aids for  Products,  which shall be subject to prior  written  approval of World
Heart.

III.     Obligations of World Heart

          A. In supplying Edwards with Products,  World Heart shall, among other
requirements:

               1. Provide all sales support and customer interface in the United
States until such time as Edwards and World Heart agree that United States sales
warrant the establishment by Edwards of a direct sales force;

               2. Fulfill Edwards' purchase requests,  provided,  however,  that
World  Heart shall not be liable in any way for failure to ship or for any delay
in shipment caused by events or circumstances beyond World Heart's control;

               3. Pay for all costs and expenses  associated with regulatory and
clinical  approval of the  Products  and the  maintenance  of such status in all
markets and territories  incurred by World Heart or by Edwards at the request of
World Heart;

               4. Pay for all direct  marketing  costs including the training of
clinicians and implanting  centers and World Heart's sales and support personnel
and all costs incurred in establishing and maintaining  reference  centers to be
used by World Heart for customer training;

               5. Provide  Edwards with product  information,  clinical  papers,
sales and promotional literature,  and product use training reasonably necessary
to enable Edwards to perform its obligations under this Agreement;

               6.  Provide  finished  products  which  are  compliant  with  all
applicable  laws and  regulations in whatever  jurisdiction  the Product will be
used; the product  labeling shall include the statement,  "Manufactured by World
Heart for Edwards" and all other statements required by such applicable laws and
regulations;

               7.  Issue a credit or refund to  Edwards  for,  or  replace at no
charge to Edwards, all defective or otherwise  unmerchantable  Products returned
by Edwards,  or returned by  customers to Edwards and  subsequently  returned to
World Heart by  Edwards,  within 30 days of return to World  Heart,  and provide
Edwards with written  reports of evaluation of such Products,  and pay all costs
associated with such Products including any freight charge reasonably  necessary
under the particular circumstances;

               8. Obtain and keep in force  during the term of this  Agreement a
Comprehensive  General Liability insurance policy in an amount not less than the
greater of (a) $5,000,000 or (b) one times the amount of World Heart Gross Sales
for the previous twelve (12) month period to a maximum of $100 million, for each
occurrence for bodily injury and property  damage for: (i)  premises-operations;
(ii)  products/completed  operations;  (iii) blanket contractual liability;  and
(iv) personal injury. During the term of this Agreement and for a period of four
(4) years  following the  expiration or  termination  of this  Agreement for any
reason,  such insurance policy shall evidence  Edwards as an additional  insured
and shall  provide for written  notification  to Edwards by the insurer not less
than 30 days prior to  cancellation,  expiration  or  modification.  World Heart
shall provide a certificate of insurance evidencing compliance with this Section
to Edwards within 30 days after the Effective Date;

               9. Comply with all  applicable  requirements  in the countries in
which Products are sold relating to the reporting of adverse reactions  suffered
by end  users of  Products,  and will  promptly  report  all such  instances  to
Edwards, specifying the date, time, and nature of the occurrence, the customer's
name and address,  the Products  (including  batch number if available)  and any
other relevant information which Edwards may reasonably request;

               10. Inspect all Products for compliance  with  specifications  in
accordance with World Heart quality control standards and systems; and

               11.  Replace   Products   which  have  become   obsolete  due  to
improvements  to the Products  which impact the  clinical  effectiveness  of the
Products.

IV.      Registration of Products; Import and Export Restrictions

          A. Edwards  shall pay for all import and export  licenses and permits,
pay  customs  charges  and duty fees,  and take all other  actions  required  to
accomplish the export and import of the Products it purchases.

          B.  All  sales  of the  Products  made  by  Edwards  pursuant  to this
Agreement  shall be in strict  compliance  with  applicable  United  States laws
dealing with foreign  trade and commerce  including but not limited to, the U.S.
Foreign Corrupt Practices Act. Edwards shall comply with all applicable laws and
regulations in each jurisdiction in which it sells the Products.

          C. World Heart shall retain all rights and obligations associated with
governmental  and  other   regulatory   approvals  and  shall  use  commercially
reasonable  efforts to obtain  required  approvals in any country in which World
Heart and Edwards determine a reasonable commercial opportunity exists.

V.       Purchase Requirements

          A. All orders for Products  submitted by Edwards shall be initiated by
written  purchase  orders sent to World  Heart and  requesting  a delivery  date
during  the  term of this  Agreement;  provided,  however,  that  an  order  may
initially be placed orally or by facsimile if a confirmational  written purchase
order is  received  by World  Heart  within  five (5) days  after  said  oral or
facsimile order. World Heart shall use commercially reasonable efforts to notify
Edwards of the acceptance or rejection of an order and of the assigned  delivery
date for  accepted  orders  within  five (5)  days  but in no event  later  than
fourteen (14) days after receipt of the purchase  order.  World Heart shall have
no liability with respect to purchase orders that are not accepted.  World Heart
shall use  commercially  reasonable  efforts  to deliver  products  at the times
specified  either in its  quotation  or in its  written  acceptance  of purchase
orders.

          B. Edwards shall provide World Heart with a rolling  twelve (12) month
forecast of its purchase  requirements  for the  Products,  updated on a monthly
basis.  In conjunction  with each monthly  update of the forecast,  Edwards will
provide World Heart with a binding  purchase  order equal to the first three (3)
months of the forecast.

VI.      Pricing, Payment, Shipping

          A. The price to Edwards for the Products is  structured in tiers based
on the  following  annual  purchase  levels and will be determined on a regional
basis. As used herein,  the term "Base Price" shall mean Edwards'  average sales
price in the applicable  region for such Product to customers  during the 90 day
period  immediately  prior to the  Effective  Date.  If the relevant  Product or
territory is a product  which or territory  where  Edwards is not selling on the
Effective Date,  Edwards shall forecast Base Prices  ("Forecasted  Base Prices")
prior to beginning  its sales of such  Product or in such region,  and after the
first 90 days of sales,  each  Forecasted  Base Price shall be adjusted based on
actual average sales prices over the initial 90 days of sales.

          B. For the first $10 million United States Dollars ("U.S. Dollars") of
worldwide  purchases  of the  Products  by  Edwards  during  any  year  of  this
Agreement,  the purchase  price for any Product shall be the Base Price less 35%
of such Base Price.  During any such one year period in which  worldwide  annual
purchases  of the  Products by Edwards do not exceed $10 million  U.S.  Dollars,
World Heart hereby  guarantees  that Edwards' gross profit for its  distribution
activities pursuant to this Agreement shall be at least $2 million U.S. Dollars.

          C. For worldwide  purchases of the Products by Edwards during any year
of this Agreement which are made after Edwards has purchased  Products  totaling
$10  million  U.S.  Dollars  during such year but before  Edwards has  purchased
Products  totaling  $100  million U.S.  Dollars in value  during such year,  the
purchase price shall be the Base Price less 30% of such price.

          D. For worldwide  purchases of the Products by Edwards during any year
of this Agreement which are made after Edwards has purchased  Products  totaling
$100 million U.S. Dollars during such year, the purchase price shall be the Base
Price less 25% of such price.

          E. At the end of each calendar year during the term of this  Agreement
and the end of the  calendar  year  during  which this  Agreement  expires or is
otherwise  terminated,  World  Heart  and  Edwards  shall  make  purchase  price
adjustments  necessary to insure that Edwards'  guaranteed gross profit from the
distribution activity contemplated by this Agreement is at least $2 million on a
pro-rated annual basis.

          F. In the event the  economics  of either  party  with  respect to the
transactions  contemplated by this Agreement change substantially,  both parties
agree to review in good  faith the  pricing  terms of this  Agreement.  Specific
exceptions  to the  pricing set forth  herein may be  mutually  agreed to by the
parties.

          G. All prices are F.O.B. World Heart's  manufacturing  facility and do
not include any foreign,  federal,  state or local sales,  use,  excise or value
added tax that may be applicable.  When World Heart has the legal  obligation to
collect such taxes,  the appropriate  amount shall be added to Edwards'  invoice
and paid by  Edwards  unless  Edwards  provides  World  Heart  with a valid  tax
exemption  certificate  authorized by the appropriate  taxing authority.  In all
cases, title, risk of loss and all responsibility for transportation,  insurance
and storage  shall pass from World  Heart to Edwards  upon  shipment  from World
Heart's plant.

          H. For purposes of this Agreement, "Shipment Date" shall mean the time
when any Product is first  shipped  F.O.B.  World Heart's  plant.  Edwards shall
specify a method of transportation  and a carrier in writing at the time Edwards
submits the purchase order to World Heart. If Edwards does not so specify, World
Heart  will  determine  the  method of  transportation  and the  carrier  in its
reasonable discretion.

          I. Full  payment  (including  any freight,  taxes or other  applicable
costs  initially paid by World Heart but to be borne by Edwards  pursuant to the
terms hereof) for Products  shall be made by Edwards to World Heart within sixty
(60)  days of the  date of  shipment.  Payment  shall be made in  United  States
Dollars.

VII.     Product Recalls

          A. In the event that  Edwards or World Heart  recalls any Products for
any reason,  the party instituting the recall shall immediately notify the other
party in writing.  Edwards shall,  immediately upon receipt of such notice, give
notice  of the  recall  to each  customer  to  which  it has  sold,  along  with
instructions, if any, delivered by World Heart relating to the recall.

          B. Edwards shall make commercially  reasonable efforts to assist World
Heart in giving  effect to the  recall.  World  Heart  shall  bear all costs and
expenses  of any recall  including,  without  limitation,  obligations  to third
parties,  costs of notifying customers and costs associated with the shipment of
recalled  Products from customers to Edwards or World Heart,  and replacement of
such products.

          C. In the event that  Edwards  desires to recall  any  Products  for a
reason caused by acts or omissions of Edwards,  Edwards shall notify World Heart
prior to said recall and shall bear all costs associated with such recall.

VIII.    Discontinuance of Product Manufacture or Clinical Support

          Edwards shall  receive at least one year prior  written  notice of any
intent by World Heart to discontinue the  manufacture,  or clinical  support of,
the  Products.  World  Heart  shall not give such  notice  to  Edwards  prior to
December  31,  2001,  unless  World  Heart  agrees to provide  hardware  support
consistent with previous practices to any patient implanted with a Product until
such time as such support is no longer clinically required.

IX.      Term and Termination

          A. Term.  This  Agreement  shall commence on the Effective Date and be
valid for an initial term of five (5) years ("Initial Term"). Upon expiration of
the Initial Term,  and at each  anniversary of such  expiration,  this Agreement
shall  automatically  renew for additional terms ("Additional  Term") of one (1)
year unless terminated pursuant to the terms of this Article IX.

          B. Immediate  Termination.  This Agreement may be terminated by either
party  immediately in the event that (i) any material  breach by the other party
remains  uncured 30 days after written notice  containing  details of the breach
has been  delivered  to the other  party;  (ii) the other  party  shall file for
protection  from its  creditors  under any  applicable  bankruptcy or insolvency
laws,  shall make an assignment  for the benefit of  creditors,  or shall have a
receiver appointed for its property; or (iii) operation of local law invalidates
this  Agreement,  but in the case of (iii),  only with  respect to such  market,
products and/or territory where this Agreement is invalidated.

          C. Change of Control. In the event that a third party acquires control
of a party to this Agreement ("Change of Control"), the party that has undergone
a Change of Control  shall  notify the other  party of such change in writing no
less than 30 days after the Change of Control  and the other party shall have 60
days following receipt of such notice to terminate this Agreement.

          D. 18 Months Notice. Either party may terminate this Agreement upon 18
months prior written  notice to the other at any time  following two years after
the Effective Date of this Agreement.  In the event that World Heart  terminates
this Agreement pursuant to this subsection, World Heart shall pay Edwards:

               1.  150% of all  expenses  paid by  Edwards  as a result of World
Heart's  termination,  including without  limitation,  severance costs and costs
related to closing of office and warehouse space used in the performance of this
Agreement; plus

               2. for all Products  distributed by Edwards prior to termination,
three  percent (3%) of World  Heart's  gross sales of such Products for the most
recent 12 months, for three (3) years following termination.  Edwards shall have
the right to audit World Heart's  financial  records upon reasonable  notice and
during  regular  business  hours in  order to  ascertain  compliance  with  this
provision.

          E. Continuation of Patient Support. In the event of any termination or
expiration  of this  Agreement  for any reason,  World Heart shall  continue all
customer  and  patient  support  at levels  consistent  with  Edwards'  previous
practices and the maintenance of patient life and safety until such time as such
support is no longer clinically required.

          F.  Trademarks  upon   Termination.   Upon  any  termination  of  this
Agreement,  Edwards shall immediately cease using the name,  trademark,  service
mark,  logo or any  other  reference  of or to World  Heart  and  shall,  at its
expense,  surrender  and deliver to World  Heart  within  thirty (30) days,  all
documents,  papers and records which contain  confidential  information of World
Heart  and  all  undistributed  samples,  instruments,   equipment,   pamphlets,
catalogs, booklets, technical information, advertising, demonstration equipment,
consigned  inventory,  selling data and other papers relating to the business of
World Heart (collectively, the "Sales Materials").

          G. Inventory  Return.  Upon any termination of this  Agreement,  World
Heart shall  accept the return of Edwards'  inventory of Products and refund the
price Edwards paid,  provided that the Products are returned unused and packaged
in their original, unopened, unmarked and unbroken sterile containers.

X.       Warranties and Indemnification

          A. World Heart warrants that it possesses good and marketable title to
any Products sold to Edwards under this  Agreement and that each Product is free
from defects and fit for the purposes and indications described in its labeling.

          B. World  Heart  hereby  indemnifies  and agrees to defend and to hold
harmless Edwards, its officers,  directors,  shareholders,  employees,  parents,
successors,  affiliates,  assigns,  customers  and  users of  Products  from and
against any and all claims,  demands,  actions,  causes of action,  liabilities,
losses, damages and expenses, including reasonable attorney fees, arising out of
or in connection  with:  (i) the  manufacture  or use of any Products;  (ii) the
design of any  Products or component  not  developed  exclusively  by Edwards or
(iii)  any  claim  of  infringement  of  patents,  trademarks,   tradenames,  or
copyrights,  any  claim  of  misappropriation  or  misuse  of trade  secrets  or
information  or any  similar  claim,  by reason of the sale or use of  Products.
Edwards  shall  promptly  notify  World  Heart of any such  claim and may either
tender its  defense of such claim to World  Heart or may retain its own  counsel
without waiving any of its right to indemnification hereunder.

          C. Edwards hereby  indemnifies  and agrees to defend and to hold World
Heart, its successors,  affiliates, assigns, customers and users of the Products
harmless from and against all claims, liabilities, losses or expenses, including
reasonable  attorney  fees, to the extent of harm  resulting  from: (i) physical
mishandling of the Products by Edwards; or (ii) any misrepresentation by Edwards
concerning  any of the  characteristics  of the Products or the proper manner of
usage or the performance of the Products or (iii) Edwards' actions in support of
Products for clinics pursuant to paragraph II(A)(3) of this Agreement.

          D. The party seeking  indemnification  (the "Indemnified Party") shall
notify the indemnifying party (the "Indemnifying  Party") of all claims that may
be subject to indemnification  under this Article within a reasonable time after
their receipt.  The  Indemnified  Party will cooperate  fully with  Indemnifying
Party in defending  or otherwise  resolving  each such claim.  The  Indemnifying
Party will have full control of the defense of all such claims.  The Indemnified
Party, at its expense, shall be entitled to be represented by its own counsel in
any such claim. The Indemnifying  Party agrees to bear all costs and expenses of
defense,  including its own attorney's fees in connection  with such claim,  and
the   Indemnifying   Party  will  reimburse  the  Indemnified   Party  for  each
disbursement  made by the Indemnified  Party in satisfaction of a final judgment
issued in such claim.

XI.      Intellectual Property Rights and Confidentiality

          A. Limited Use of Intellectual  Property.  Edwards agrees that Edwards
has no  intellectual  property  interest  in the  Products  or in World  Heart's
patents,  trademarks,  service  marks,  trade  names,  inventions,   copyrights,
know-how,  and trade secrets relating to the design,  manufacture,  operation or
service  of  Products.  The use by Edwards  of any of these  property  rights is
authorized only for the purposes herein set forth,  and upon termination of this
Agreement for any reason such authorization shall cease.

          B. Trademarks. World Heart agrees that:

               1. World Heart has no right,  title or interest in the trademarks
and trade names connoting  Edwards.  Should any such use vest in World Heart any
rights in a  trademark,  trade name or logo used by  Edwards,  World Heart shall
transfer such rights to Edwards or its designee upon request of Edwards; and

               2. During the term of this Agreement, Edwards will have the right
to indicate to the public that it is an authorized  distributor  of the Products
and to advertise under the trademarks,  service marks and trade names that World
Heart may adopt from time to time (the "World Heart Trademarks").

          C.  Confidential   Information.   In  order  to  avoid  disclosure  of
confidential and proprietary  information  ("Information")  to any other person,
firm or  corporation,  the parties agree that during the term of this  Agreement
and for a period of 3 years from the expiration or termination of this Agreement
each will  treat any such  information  which is  received  from one  another in
writing and clearly mark such information "Confidential" or if disclosed orally,
which is  confirmed  in writing as  "Confidential"  within  thirty  (30) days of
initial disclosure,  with the same degree of care that each employs with respect
to  its  own  information  which  it  does  not  desire  to  have  published  or
disseminated.  It is  understood  that  each  party  shall  be  liable  for  any
unauthorized  disclosure  should it fail to safeguard the disclosed  information
with such care. This obligation shall survive the termination of this Agreement.
The parties shall not have any obligation with respect to such information which
is:

               1.  independently  developed by the  receiving  party without the
benefit of the disclosure or is already known to the receiving party at the time
of the disclosure, as evidenced by written documentation;

               2. publicly known or becomes  publicly known without the wrongful
act or breach of this Agreement by the receiving party; or

               3. rightfully  received by the receiving party from a third-party
who is not under any obligation of confidentiality or trade secret obligation to
the originating party.

XII.     Miscellaneous

          A.   Relationship.   The  relationship  of  Edwards  and  World  Heart
established by this Agreement is of independent  contractors and not agents, and
nothing in this Agreement shall be construed:

               1. To give either  party the power to direct or control the daily
activities  of the other  party  beyond the  obligations  imposed on Edwards and
World Heart, respectively, by this Agreement;

               2.  To  constitute  the  parties  as  partners,  joint  ventures,
co-owners or otherwise as participants in joint undertaking; or

               3. To allow  either party to create or assume any  obligation  on
behalf of the other party for any purpose whatsoever.  The purchase,  promotion,
and resale of, or any other legal transactions concerning the Products hereunder
shall be carried out in the name of and for the account of Edwards as principal,
and Edwards shall not enter into any agreement with third persons binding in any
way on World Heart.

          B. No Conflict.  Each party represents and warrants to the other party
that it is not subject to any  contractual  obligation  or restraint  which will
materially interfere with its right and ability to perform pursuant to the terms
of this Agreement.

          C. Compliance  With Laws. Each party  represents and agrees that it is
and will remain in compliance with all applicable federal, state and local laws,
regulations  and orders,  including laws of the countries in which Edwards sells
products.

          D. Dispute resolution. Any controversy or claim relating to or arising
from this Agreement that is not fully  resolved  pursuant to negotiation  and/or
mediation  within thirty (30) days after a party first  notifies the other party
of such claim or controversy  shall be solely and finally settled by arbitration
in accordance  with the CPR Rules for  Non-Administered  Arbitration of Business
Disputes ("CPR Rules"). The arbitration shall be conducted by a sole arbitrator,
who shall be a former judge, appointed by jointly by the parties ("Arbitrator").
If the parties cannot agree on the appointment of an Arbitrator, they shall each
propose one individual from CPR's Regional Panel of  Distinguished  Neutrals for
the State of California.  The two proposed  individuals shall mutually appoint a
third  individual,  who  is a  former  judge  from  the  same  panel,  to be the
Arbitrator.  The  arbitration  shall be  governed by the  provisions  of the CPR
Rules,  and judgment upon the award rendered by the Arbitrator may be entered by
any court having jurisdiction thereof. The arbitration proceedings shall be held
in the State of California.  To the extent permissible under applicable law, the
parties  agree  that the  award of the  Arbitrator  shall be final  and shall be
subject only to the judicial review permitted by the CPR Rules. It is the intent
of the parties that the arbitration provisions hereof be enforced to the fullest
extent  permitted by applicable  law. The Arbitrator  may not award  multiplied,
consequential or punitive damages,  and the parties hereby irrevocably waive any
right to multiplied, punitive or consequential damages.

          E.  Governing Law. This  agreement  shall be governed by,  interpreted
under,  and  construed  in  accordance  with the  internal  laws of the State of
California without respect to its choice of law provisions.

          F. 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:

               1.  if  delivered  by hand or by  nationally  recognized  courier
service,  when  delivered  at the address  specified  in this  agreement  (or in
accordance with the latest unrevoked written direction from such party);

               2. if by certified mail, upon mailing; or

               3. if given by facsimile  when such  facsimile is  transmitted to
the fax number  specified in this  agreement (or in  accordance  with the latest
unrevoked  written   direction  from  such  party),   provided  the  appropriate
confirmation is received.


To World Heart:

         World Heart Corporation
         1 Laser Street
         Nepean, Ontario
         K2E 7V1
         Attn:  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 K1P 5K6
         Attn:  Robert D. Chapman
         Fax:  (613) 563-9386

To Edwards:

         Edwards Lifesciences LLC
         One Edwards Way
         Irvine, CA 92614
         Attn:  Associate General Counsel
         Fax: 949-250-6850

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

         Skadden, Arps, Slate, Meagher & Flom LLP
         300 South Grand Avenue, Suite 3400
         Los Angeles, California  90071-3144
         Attn: Joseph J. Giunta, Esq.
         Fax:   (213) 687-5600

          G.  Expenses.  Except as otherwise  provided in this  Agreement,  each
party  to  this  Agreement  shall  bear  its  respective  expenses  incurred  in
connection with the  preparation,  execution,  and performance of this Agreement
and the  transactions  contemplated  hereby,  including all fees and expenses of
agents, representations, counsel and accountants.

          H. Entire Agreement. This Agreement, including all exhibits hereto and
thereto, by and between Edwards and World Heart, constitute the entire agreement
of the parties  with respect to the subject  matter  hereof and  supersedes  all
prior agreements with respect to the subject matter hereof.

          I. No Third Party  Beneficiaries.  This  Agreement and the  provisions
hereof  shall be  binding  upon and shall  inure to the  benefit  of each of the
parties  and  their  respective  successors  and  permitted  assigns  and is not
intended to confer any rights, remedies or benefits on any Persons other than as
expressly set forth in this Section.

          J.  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  therefore 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.

          K.   Amendments;   Modifications.   No  amendment,   modification   or
termination  of this  Agreement  shall be binding  upon any other  party  unless
executed in writing by the parties hereto intending to be bound thereby.

          L.  Assignment.  Neither  this  Agreement  nor any  rights,  duties or
obligations  hereunder may be assigned or delegated by any of the parties hereto
without  the prior  written  consent  of the other  party.  Notwithstanding  the
foregoing,  Edwards shall be entitled to assign this  Agreement to any person or
entity  controlling,  controlled by or under common control with Edwards without
consent. Any attempted assignment or delegation of rights, duties or obligations
hereunder in contravention hereof shall be void and of no effect.

<PAGE>


          IN WITNESS  WHEREOF,  the parties  hereto execute this Agreement as of
the date first written above.


Edwards Lifesciences LLC                   World Heart Corporation

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



<PAGE>


                      EXHIBIT "A" TO DISTRIBUTION AGREEMENT

                             Description of Products


The Products, for purposes of the Distribution Agreement between World Heart and
Edwards of which  this  Exhibit  "A" is a part,  shall  mean all  mechanical  or
electronic  devices  which  assist the  pumping  function  of the human heart or
replace the biological heart in patients, including without limitation:

Novacor Left Ventricle Assist Device

Heart Saver