EXCHANGE AGREEMENT

          EXCHANGE AGREEMENT, dated as of May 24, 2000 (the "Agreement"), by and
between  Edwards   Lifesciences   LLC,  a  Delaware  limited  liability  company
("Edwards"),  and  World  Heart  Corporation,  an  Ontario  corporation  ("World
Heart").

          WHEREAS,  Edwards,  Edwards Novacor LLC, a Delaware limited  liability
company and wholly owned subsidiary of Edwards ("Novacor LLC"), World Heart, and
Valentine Acquisition Corp., a Delaware corporation ("Newco"), have entered into
a contribution agreement, dated May 24, 2000 (the "Contribution Agreement");

          WHEREAS, Edwards and World Heart have entered into, and as a condition
to closing of the Transactions (as defined in the Contribution  Agreement) shall
have  consummated  the  transactions  contemplated  by, the Series A convertible
preferred  shares purchase  agreement dated as of May 24, 2000 (the "World Heart
Preferred Agreement");

          WHEREAS,   Edwards  owns  4,981,128  shares  of  Series  A  cumulative
participating preferred stock of Newco (the "Put 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
agree as follows:

          SECTION 1. Definitions. As used in this Agreement, the following terms
shall have the following meanings:

          "Affiliate"  shall have the meaning  specified in the  Securities  Act
(Ontario) as in effect on the date of this Agreement.

          "Business  Day" shall mean any day other  than a  Saturday,  Sunday or
other day on which banks in New York, New York or Toronto,  Ontario are required
by law to close or are customarily closed.

          "Canadian  Securities  Administrators"  means the Canadian  securities
regulators in each of the Provinces of Canada.

<PAGE>

          "Initial  Issue Date" shall have such  meaning as ascribed to the term
under the  certificate of  designation of the Series A cumulative  participating
preferred stock of Newco, Inc. (the "Certificate of Designation").

          "Person"  shall  mean  any  natural   person,   corporation,   general
partnership,  limited partnership,  limited liability company, limited liability
partnership, proprietorship, trust, union, association, court, tribunal, agency,
government,  department, commission,  self-regulatory organization,  arbitrator,
board,  bureau,  instrumentality  or  other  entity,  enterprise,  authority  or
business organization.

          "World Heart Common Shares" shall mean common shares of World Heart.

          SECTION 2. Edwards's Put Right.

          (a) For a period of one (1) year, commencing on the second anniversary
of the Initial  Issue Date (the "Put  Notice  Period"),  Edwards  shall have the
right (the "Put Right") to require World Heart to acquire all, but not less than
all, of the Put Shares in exchange  for  4,981,128  shares of World Heart Common
Shares (or such number as may be determined pursuant to the adjustments provided
in  Section  3 hereof)  (the  "World  Heart  Shares").  The Put  Right  shall be
exercisable  by delivery  during the put notice period of a written  notice (the
"Put  Notice")  to World  Heart (i)  requesting  World  Heart to acquire the Put
Shares pursuant to the Put Right, (ii) stating the date and time, which shall be
at least  ten but not  more  than 30  Business  Days  after  the date of the Put
Notice,  at which the closing  (the "Put  Closing")  of the  purchase of the Put
Shares  and the  issuance  of the World  Heart  Shares  is to  occur,  and (iii)
specifying the names and  denominations in which the  certificates  representing
the World Heart Shares to be delivered at the Put Closing are to be issued. Such
Put Notice  shall be  irrevocable.  World Heart shall  purchase  the Put Shares,
subject to the terms hereof on the date of the Put Closing.

          (b) The Put Right may be  exercised  only once (unless the Put Closing
in respect of such exercise fails to occur as a result of World Heart's  failure
to issue all of the World Heart Shares on the date of the Put Closing).

          (c) The Put Closing shall take place at the offices of Skadden,  Arps,
Slate,  Meagher & Flom LLP,  300 South Grand  Avenue,  Suite 3400,  Los Angeles,
California  90071,  or such other  location as the parties hereto shall mutually
agree,  at 10:00 a.m.  (local time).  At the Put Closing,  (i) World Heart shall
deliver to Edwards a certificate or  certificates  representing  the World Heart
Shares, in such denominations and registered in such names as Edwards shall have
requested in its


                                       2

<PAGE>


Put  Notice  to World  Heart,  and (ii)  Edwards  shall  deliver  or cause to be
delivered a certificate or certificates representing the Put Shares, accompanied
by duly executed blank stock powers or endorsed in blank for transfer,  as World
Heart may request at least three (3) Business Days prior to the Put Closing.

          SECTION 3. Adjustment of World Heart Shares.

          (a) In the event World Heart shall at any time after the Initial Issue
Date:

               (i) declare any dividend, or make any distribution on World Heart
Common Shares, in World Heart Common Shares;

               (ii) subdivide or reclassify the  outstanding  World Heart Common
Shares;

               (iii) combine or reclassify  the  outstanding  World Heart Common
Shares into a smaller number of shares;

               (iv) make a  distribution  on World Heart Common Shares in shares
of its capital stock or securities convertible, exchangeable or exercisable into
its capital stock other than, in each case, World Heart Common Shares; or

               (v) issue by  reclassification  of the World Heart Common  Shares
any shares of its capital stock;

then the aggregate number of World Heart Shares immediately prior to such action
shall be  proportionately  adjusted to reflect the aggregate  number and kind of
shares  of  capital  stock  of  World  Heart  which  Edwards  would  have  owned
immediately   following  such  action  if  the  Put  Right  had  been  exercised
immediately prior to such action.

          The adjustment shall become  effectively  immediately after the record
date in the  case of a  dividend  or  distribution  and  immediately  after  the
effective  date in the case of a subdivision,  combination or  reclassification.
Such adjustment shall be made successively whenever any event listed above shall
occur;  provided that, if the occurrence of any event listed above results in an
adjustment under subsection 3(b) or (c) below, no adjustment shall be made under
this subsection (a).

          World Heart shall not issue World Heart Common Shares as a dividend or
distribution  on any class of capital stock other than World Heart Common Shares

                                       3

<PAGE>

unless the  appropriate  adjustment to the World Heart Shares is made under this
subsection 3(a).

          (b)  Adjustment  for Rights  Issue.  If World Heart  distributes  (and
receives no consideration  therefor) any rights, options or warrants (whether or
not  immediately  exercisable)  to all holders of any class of its capital stock
entitling  them to purchase  World Heart Common Shares at a price per share less
than the  Specified  Value (as defined in Section  3(g) hereof) per share on the
record date  relating to such  distribution,  the World  Heart  Shares  shall be
adjusted in accordance with the formula:

                       V' = V x     O + N
                                -------------
                                  O + N x E
                                      -----
                                        M

where:

                       V'     =    the adjusted World Heart Shares.

                       V      =    the World Heart Shares  immediately  prior to
                                   the record date for any such distribution.

                       O      =    the  number  of  World  Heart  Common  Shares
                                   outstanding  on the record  date for any such
                                   distribution.

                       N      =    the number of  additional  World Heart Common
                                   Shares issuable upon exercise of such rights,
                                   options or warrants.

                       E      =    the exercise  price per share of such rights,
                                   options or warrants.

                       M      =    the  Specified  Value per World Heart  Common
                                   Share  on  the  record   date  for  any  such
                                   distribution.


          The  adjustment  shall be made  whenever any such  rights,  options or
warrants are issued and shall become effective immediately after the record date
for the determination of stockholders entitled to receive the rights, options or
warrants.  If at the end of the  period  during  which such  rights,  options or
warrants are  exercisable,  not all rights,  options or warrants shall have been
exercised,  the adjusted World Heart Shares shall be  immediately  readjusted to
what it would  have  been if "N" in the  above  formula  had been the  number of
shares  actually  issued.  The  adjustment  in the number of World Heart  Shares
provided  for in this  Section  3(b) shall not apply upon the  issuance of World
Heart Common Shares,  rights,  options,  warrants or convertible or exchangeable
securities in an arm's-length  transaction to  stockholders of any  unaffiliated
third party, who are neither existing stockholders nor Affiliates of World Heart
at the time,  which  unaffiliated  third party  substantially  and  concurrently
merges

                                       4


<PAGE>

with or into World Heart or any subsidiary thereof, in proportion to their stock
holdings of such unaffiliated third party immediately prior to such merger.

          (c) Adjustment for Other Distributions.  If World Heart distributes to
all holders of any class of its capital  stock (other than  scheduled  dividends
payable  on  preferred  stock or  payments  made to  redeem  preferred  stock in
accordance  with its terms) (i) any evidences of  indebtedness of World Heart or
any  of  its  subsidiaries,  (ii)  any  assets  of  World  Heart  or  any of its
subsidiaries,  or (iii) any  rights,  options or  warrants to acquire any of the
foregoing or to acquire any other  securities  of World  Heart,  the World Heart
Shares shall be adjusted in accordance with the formula:


                       V' = V x    M
                                ------
                                 M - F

where:

                       V'     =    the adjusted World Heart Shares.

                       V      =    the World Heart Shares  immediately  prior to
                                   the record date mentioned below.

                       M      =    the  Specified  Value per World Heart  Common
                                   Share on the record date mentioned below.

                       F      =    the  fair  market  value on the  record  date
                                   mentioned   below   of   the   shares,    the
                                   indebtedness,   assets,  rights,  options  or
                                   warrants  distributable  to the holder of one
                                   World Heart Common Share.


          The adjustment  shall be made whenever any such  distribution  is made
and  shall  become  effective   immediately   after  the  record  date  for  the
determination  of  stockholders  entitled  to receive  the  distribution.  If an
adjustment is made pursuant to this  subsection  (c) as a result of the issuance
of rights,  options or warrants  and at the end of the period  during  which any
such rights,  options or warrants are exercisable,  not all such rights, options
or warrants shall have been exercised,  the adjusted World Heart Shares shall be
immediately  readjusted as if "F" in the above formula was the fair market value
on the record  date of the  indebtedness  or assets  actually  distributed  upon
exercise  of such  rights,  options or  warrants  divided by the number of World
Heart Common Shares outstanding on the record date.

          This subsection does not apply to rights, options or warrants referred
to in  subsection  (b) or for  any  World  Heart  Common  Share  referred  to in
subsection  (d) of this Section 3. The  adjustment  in the number of World Heart
Shares provided

                                       5

<PAGE>


for in the preceding  paragraph shall not apply upon the issuance of World Heart
Common  Shares,  rights,  options,   warrants  or  convertible  or  exchangeable
securities in an arm's-length  transaction to  stockholders of any  unaffiliated
third party, who are neither existing stockholders nor Affiliates of World Heart
at the time,  which  unaffiliated  third party  substantially  and  concurrently
merges with or into World Heart or any  subsidiary  thereof,  in  proportion  to
their stock holdings of such unaffiliated  third party immediately prior to such
merger.

          (d)  Adjustment  for Common Stock  Issue.  If World Heart issues World
Heart Common Shares for a consideration  per share less than the Specified Value
per share on the date World Heart fixes the  offering  price of such  additional
shares, the World Heart Shares shall be adjusted in accordance with the formula:

                      V' = V x      A
                               ----------
                                 O +  C
                                     ----
                                      M

where:

                       V'     =    the adjusted World Heart Shares.

                       V      =    the World Heart Shares  immediately  prior to
                                   any such issuance.

                       O      =    the  number  of  World  Heart  Common  Shares
                                   outstanding immediately prior to the issuance
                                   of such additional World Heart Common Shares.

                       C      =    the aggregate  consideration received for the
                                   issuance  of  such  additional   World  Heart
                                   Common Shares.

                       M      =    the  Specified  Value per World Heart  Common
                                   Share on the date the offering  price of such
                                   additional shares is fixed.

                       A      =    the  number  of  World  Heart  Common  Shares
                                   outstanding immediately after the issuance of
                                   such additional World Heart Common Shares.


          The  adjustment  shall be made whenever any such issuance is made, and
shall become effective  immediately  after such issuance.  The adjustment in the
number of World Heart Shares  provided for in the preceding  paragraph shall not
apply upon (i) the  issuance  of World Heart  Common  Shares,  rights,  options,
warrants  or  convertible  or   exchangeable   securities  in  an   arm's-length
transaction to stockholders  of any  unaffiliated  third party,  who are neither
existing  stockholders  nor  Affiliates  of  World  Heart  at  the  time,  which
unaffiliated  third party  substantially  and

                                       6

<PAGE>


concurrently  merges  with or into World  Heart or any  subsidiary  thereof,  in
proportion to their stock holdings of such unaffiliated  third party immediately
prior to such  merger;  (ii) the issuance of options or  restricted  stock at an
exercise  price  below the  Specified  Value  pursuant  to any now or  hereafter
existing stock option or incentive plan of World Heart which in the aggregate do
not exceed 20% of the World Heart Common  Shares on a fully  diluted basis as of
the date hereof;  or (iii) the issuance of securities in connection  with a bona
fide  financing  or  refinancing  by World  Heart  with a Person  that is not an
Affiliate.

          This  subsection  (d) does not apply to any World Heart Common  Shares
with respect to which  adjustments  have been made pursuant to subsections  (b),
(c) or (e).

          (e) Adjustment for Convertible Securities Issue. If World Heart issues
any options,  warrants or other  securities  convertible into or exchangeable or
exercisable  for World Heart  Common  Shares  (other than  securities  issued in
transactions  described  in  subsection  (b)  or (c) of  this  Section  3) for a
consideration per share of World Heart Common Shares initially  deliverable upon
conversion,  exchange  or exercise of such  securities  less than the  Specified
Value per share on the date of  issuance  of such  securities,  the World  Heart
Shares shall be adjusted in accordance with this formula:

                    V' = V x     O + D
                                 -----
                                 O + C
                                     -
                                     M

where:

                       V'     =    the adjusted World Heart Shares.

                       V      =    the World Heart Shares  immediately  prior to
                                   any such issuance.

                       O      =    the  number  of  World  Heart  Common  Shares
                                   outstanding immediately prior to the issuance
                                   of such securities.

                       C      =    the  sum  of  the   aggregate   consideration
                                   received for the issuance of such  securities
                                   and  the  aggregate   minimum   consideration
                                   receivable  by World  Heart for  issuance  of
                                   World Heart Common Shares upon  conversion or
                                   in exchange  for, or upon  exercise  of, such
                                   securities.

                       M      =    the  Specified  Value per World Heart  Common
                                   Share  on  the  date  of   issuance  of  such
                                   securities.


                                       7

<PAGE>

                       D      =    the  maximum  number  of World  Heart  Common
                                   Shares  deliverable  upon  conversion  or  in
                                   exchange   for  or  upon   exercise  of  such
                                   securities   at   the   initial   conversion,
                                   exchange or exercise rate.

          The  adjustment  shall be made whenever any such issuance is made, and
shall become effective immediately after such issuance.

          If all of the World Heart Common Shares  deliverable  upon conversion,
exchange or exercise of such securities has not been issued when the conversion,
exchange or exercise rights of such securities have expired or been  terminated,
then the  adjusted  World  Heart  Shares  shall  promptly be  readjusted  to the
adjusted  World Heart  Shares  which would then be in effect had the  adjustment
upon the issuance of such securities been made on the basis of the actual number
of World Heart Common  Shares  issued upon  conversion,  exchange or exercise of
such  securities.  If the aggregate  minimum  consideration  receivable by World
Heart for issuance of World Heart Common  Shares upon  conversion or in exchange
for,  or upon  exercise  of, such  securities  shall be  increased  by virtue of
provisions  therein  contained  or upon the arrival of a  specified  date or the
happening of a specified  event,  then the World Heart Shares shall  promptly be
readjusted  to the World  Heart  Shares  which  would  then be in effect had the
adjustment  upon the issuance of such  securities been made on the basis of such
increased minimum consideration.

          This  subsection  (e) does not apply to the issuance of the Put Shares
or any of the  transactions  described  in  subsections  (b), (c) or (d) of this
Section 3. The  adjustment  in the number of World Heart Shares  provided for in
the  preceding  formula  shall not apply  upon (i) the  issuance  of  options or
restricted  stock at an exercise price below the Specified Value pursuant to any
now or hereafter existing stock option or incentive plan of World Heart which in
the  aggregate  do not exceed 20% of the World  Heart  Common  Shares on a fully
diluted basis or (ii) the issuance of securities in connection  with a bona fide
financing or refinancing by World Heart with a Person that is not an Affiliate.

          (f) Adjustment for Tender Offer.  If World Heart  consummates a tender
offer for any World Heart Common  Shares and purchases  shares  pursuant to such
tender  offer for an  aggregate  consideration  having a fair  market  value (as
determined reasonably and in good faith by the Board of Directors of World Heart
and described in a board resolution) as of the last time (the "Expiration Time")
that  tenders may be made  pursuant  to such  tender  offer (as it may have been
amended) that,  together with (i) the aggregate of the cash plus the fair market
value (as  determined  reasonably and in good faith by the Board of Directors of
World Heart

                                       8

<PAGE>

and described in a board resolution) of the consideration paid in respect of any
other tender offer by World Heart for any World Heart Common Shares  consummated
within the 12 months  preceding the  Expiration  Time and in respect of which no
adjustment pursuant to this subsection (f) has been made previously and (ii) the
aggregate  amount of any  distributions  to all  holders of World  Heart  Common
Shares  within the 12 months  preceding the  Expiration  Time exceeds 20% of the
product of the Specified  Value per share  immediately  prior to the  Expiration
Time times the number of World Heart Common Shares  outstanding  (including  any
tendered  shares)  at the  Expiration  Time,  the World  Heart  Shares  shall be
adjusted in accordance with the formula:

                  V' = V x M x (O - N)
                          -------------
                          (M x O) - F

where:

                       V'     =    the adjusted World Heart Shares.

                       V      =    the World Heart Shares  immediately  prior to
                                   the Expiration Time.

                       M      =    the  Specified  Value per World Heart  Common
                                   Share  immediately  prior  to the  Expiration
                                   Time.

                       O      =    the  number  of  World  Heart  Common  Shares
                                   outstanding  (including any tendered  shares)
                                   at the Expiration Time.

                       F      =    the  fair  market  value  of  the   aggregate
                                   consideration paid for all World Heart Common
                                   Shares  purchased   pursuant  to  the  tender
                                   offer.

                       N      =    the  number  of  World  Heart  Common  Shares
                                   accepted for payment in such tender offer.


          If the number of shares  accepted  for payment in such tender offer or
the aggregate consideration payable therefor have not been finally determined by
the opening of business on the day following the Expiration Time, the adjustment
required by this subsection (f) shall, pending such final determination, be made
based upon the preliminary  announced  results of such tender offer,  and, after
such final  determination  shall have been made, the adjustment required by this
subsection (f) shall be based upon the number of shares  accepted for payment in
such tender offer and the aggregate consideration payable therefor as so finally
determined.

                                       9

<PAGE>

          (g) Certain  Definitions.  For the  purposes of this Section 3, unless
the context requires otherwise, the following terms shall
have the meanings herein specified in this subsection 3(g).

          The  "Specified  Value" per World Heart  Common  Share or of any other
security (herein collectively referred to as a "Security") at any date shall be:

          (i) if the Security is not registered  under the  Securities  Exchange
Act of 1934,  as  amended  (the  "Exchange  Act"),  the  value  of the  Security
determined  in good faith by the Board of Directors of World Heart and certified
in a board  resolution,  which  valuation  shall be  based on the most  recently
completed arm's length  transaction  between World Heart and a person other than
an Affiliate  of World Heart in which such  determination  is necessary  and the
closing  of which  occurs on such date or shall  have  occurred  within  the six
months preceding such date, if such transaction has occurred; provided, however,
that if Edwards  objects to such valuation  within 60 days of the  determination
thereof by the Board of Directors of World Heart,  the value shall be determined
by an  Independent  Financial  Expert  selected  by World  Heart and  reasonably
acceptable to Edwards, or

          (ii) if the Security or the World Heart  Common  Shares into which the
Security is  convertible  is  registered  under the  Exchange  Act, the weighted
average  of the daily  market  prices  for each  business  day during the period
commencing 20 trading days before such date and ending on the date one day prior
to such date or, if the Security has been registered  under the Exchange Act for
less than 20 consecutive  trading days before such date, then the average of the
daily market prices (as hereinafter defined) for all of the business days before
such date for which daily market  prices are  available.  If the market price is
not  determinable  for at least 15 trading  days in such period,  the  Specified
Value of the Security shall be determined as if the Security were not registered
under the Exchange Act.

          The  "market  price"  for any  Security  shall  mean (A) the  weighted
average  of closing  prices  for sales of such  Security  on The  Toronto  Stock
Exchange  and the Nasdaq  National  Market  (with  prices on The  Toronto  Stock
Exchange  converted into United States dollars at the noon buying rate certified
by the New York Federal Reserve Bank for customs  purposes on such date) for the
five consecutive trading days preceding the date of determination or (B) if such
Security is not then listed and posted for trading on The Toronto Stock Exchange
or the Nasdaq National Market, the weighted average of the closing price on such
stock  exchange  on which such  Security is listed and posted for trading and on
which such Security is most  actively  traded for the five  consecutive  trading
days  preceding the date of

                                       10

<PAGE>

determination, or (C) if such Security is not then listed or admitted to trading
on any  securities  exchange,  the last  reported  sale price on such day, or if
there is no such last  reported  sale  price on such  day,  the  average  of the
closing  bid and the asked  prices  on such  day,  as  reported  by a  reputable
quotation  source  designated  by World Heart.  If there are no such prices on a
Business Day, then the market price shall not be determinable  for such Business
Day.

          In the case of World Heart  Common  Shares,  if more than one class of
World Heart Common Shares is  outstanding,  the  "Specified  Value" shall be the
highest of the  Specified  Values per share of all such  classes of World  Heart
Common Shares.

          "Independent  Financial  Expert"  shall mean a  nationally  recognized
investment  banking or appraisal  firm selected by World Heart (i) that does not
(and whose directors,  officers,  employees and Affiliates do not) have a direct
or indirect  financial  interest in World Heart, (ii) that has not been, and, at
the time it is called upon to serve as an  Independent  Financial  Expert  under
this  Agreement  is not (and none of whose  directors,  officers,  employees  or
Affiliates  is) a promoter,  director or officer of World Heart,  (iii) that has
not been  retained  by World  Heart for any  purpose,  other  than to perform an
equity  valuation,  within the preceding  twelve  months,  and (iv) that, in the
reasonable  judgment of the Board of  Directors  of World  Heart,  is  otherwise
qualified  to serve as an  independent  financial  advisor.  Any such person may
receive customary  compensation and  indemnification by World Heart for opinions
or services it provides as an Independent Financial Expert.

          (h) Consideration Received. For purposes of any computation respecting
consideration  received pursuant to subsections (d) and
(e) of this Section 3, the following shall apply:

               (i) in the case of the issuance of World Heart Common  Shares for
cash, the consideration  shall be the amount of such cash (without any deduction
being made for any  commissions,  discounts or other expenses  incurred by World
Heart for any underwriting of the issue or otherwise in connection therewith);

               (ii) in the case of the issuance of World Heart Common Shares for
a  consideration  in whole or in part other than cash, the  consideration  other
than cash shall be deemed to be the fair market value thereof  (irrespective  of
the  accounting  treatment  thereof) as determined in good faith by the Board of
Directors of World Heart; and

                                       11

<PAGE>

               (iii) in the case of the  issuance of options,  warrants or other
securities  convertible  into or  exchangeable  or  exercisable  for World Heart
Common Shares, the aggregate  consideration received therefor shall be deemed to
be the consideration received by World Heart for the issuance of such securities
plus the additional minimum consideration, if any, to be received by World Heart
upon the conversion,  exchange or exercise  thereof (the  consideration  in each
case to be  determined in the same manner as provided in clauses (i) and (ii) of
this subsection (h)).

          (i) When De Minimis  Adjustment May Be Deferred.  No adjustment to the
World Heart Shares needs be made unless the adjustment would require an increase
or decrease of at least 1% in the World Heart Shares. Any adjustment that is not
made  shall  be  carried  forward  and  taken  into  account  in any  subsequent
adjustment,  provided that no such adjustment  shall be deferred beyond the date
on which the Put Right is exercised.

          All  calculations  under this  Section 3 shall be made to the  nearest
1/100th of a share.

          (j) When No  Adjustment  Required.  If an  adjustment is made upon the
establishment of a record date for a distribution subject to subsection (a), (b)
or (c) hereof and such distribution is subsequently  cancelled,  the World Heart
Shares then in effect  shall be  readjusted,  effective  as of the date when the
Board of Directors of World Heart  determines  to cancel such  distribution,  to
that which would have been in effect prior to the fixing of such record date.

          (k) Notice of  Adjustment.  Whenever  the number of World Heart Common
Shares to be  received  as World  Heart  Shares is  adjusted,  World Heart shall
provide the notices required by Section 9 hereof.

          (l) Reorganizations. In case of any capital reorganization, other than
in the cases referred to in subsections  3(a), (b), (c), (d), (e) or (f) hereof,
or the  consolidation or merger of World Heart with or into another  corporation
(other than a merger or  consolidation  in which  World Heart is the  continuing
corporation and which does not result in any reclassification of the outstanding
World Heart  Common  Shares into  shares of other stock or other  securities  or
property),  or the  sale of the  property  of  World  Heart  as an  entirety  or
substantially  as an entirety  (collectively,  such  actions  being  hereinafter
referred to as  "Reorganizations"),  there shall  thereafter be deliverable upon
exercise  of any Put Right (in lieu of the number of World Heart  Common  Shares
theretofore  deliverable)  the number of shares of stock or other

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<PAGE>

securities  or property  to which a holder of the number of World  Heart  Common
Shares that would otherwise have been  deliverable upon the exercise of such Put
Right would have been  entitled upon such  Reorganization  if such Put Right had
been exercised in full immediately prior to such Reorganization.  In case of any
Reorganization, appropriate adjustment, as determined in good faith by the Board
of Directors of World Heart,  whose  determination  shall be described in a duly
adopted  resolution  certified by the secretary or assistant  secretary of World
Heart,  shall be made in the application of the provisions herein set forth with
respect to the rights and interests of Edwards so that the  provisions set forth
herein shall thereafter be applicable, as nearly as possible, in relation to any
shares or other property thereafter deliverable upon exercise of the Put Right.

          World Heart shall not effect any such  Reorganization  unless prior to
or  simultaneously  with the  consummation  thereof  the  successor  corporation
resulting from such Reorganization or the corporation purchasing or leasing such
assets or other  appropriate  corporation or entity shall expressly assume, by a
supplemental  Exchange Agreement or other acknowledgment  executed and delivered
to  Edwards,  the  obligation  to  deliver  to  Edwards  such  shares  of stock,
securities or assets as, in accordance  with the foregoing  provisions,  Edwards
may be entitled to receive, and all other obligations and liabilities under this
Agreement.

          (m) No Impairment.  World Heart will not, through any  reorganization,
recapitalization,  transfer of assets, consolidation, merger, dissolution, issue
or sale of securities or any other voluntary action,  avoid or seek to avoid the
observance or performance of any of the terms to be performed hereunder by World
Heart, but will at all times in good faith assist in the carrying out of all the
provisions of this  Exchange  Agreement and in the taking of all such actions as
may be necessary or appropriate in order to protect the  exercisability  of this
Exchange Agreement and the rights of Edwards against impairment.

          (n)  Miscellaneous.  For  purpose of this  Section 3, the term  "World
Heart Common Shares" shall mean (i) the World Heart Common Shares as of the date
of this  Agreement,  and (ii) shares of any other class of stock  resulting from
successive  changes or  reclassification  of such  shares  consisting  solely of
changes in par value, or from par value to no par value, or from no par value to
par value.  In the event  that at any time,  as a result of an  adjustment  made
pursuant  to this  Section 3,  Edwards  shall  become  entitled  to receive  any
securities other than, or in addition to, World Heart Common Shares,  thereafter
the number or amount of such other  securities  to be received  upon exercise of
the Put Right shall be subject to  adjustment  from time to time in a manner and
on terms as nearly  equivalent as practicable to the

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<PAGE>

provisions  with respect to the World Heart Shares  contained in subsections (a)
through (n) of this Section 3,  inclusive,  and the  provisions of Sections 2, 4
and 5 with respect to the World Heart  Shares or the World Heart  Common  Shares
shall apply on like terms to any such other securities.

          SECTION  4.  Fractional   Interests.   World  Heart  shall  not  issue
fractional shares of World Heart Common Shares on the exercise of the Put Right.
If any fraction of a share of World Heart Common  Shares  would,  except for the
provisions  of this  Section 4, be  issuable  on the  exercise of the Put Right,
World Heart  shall pay an amount in cash equal to the fair  market  value of the
share of World Heart Common Shares so issuable, multiplied by such fraction.

          SECTION 5. Other  Adjustments.  If World  Heart  shall take any action
affecting the World Heart Common Shares, other than action described in Sections
3 and 4, that in the good faith determination of the Board of Directors of World
Heart  materially  adversely  affects the value of the World Heart  Shares,  the
aggregate  amount of the World Heart  Shares  shall be  adjusted,  to the extent
permitted  by law, in such  manner,  if any,  and at such time,  as the Board of
Directors of World Heart may  determine  to be  equitable in the  circumstances;
provided  that the  provisions  of this  Section 5 shall not  affect  any rights
Edwards may have at law or in equity.

          SECTION 6. No Further  Rights.  From and after the date of exercise of
the Put Right  pursuant  to Sections 2, 3, 4 and 5, the holder of any of the Put
Shares subject to such Put Right shall cease to have any rights as a stockholder
in respect  thereof,  other than the right to receive the purchase price payable
therefor upon the terms and subject to the conditions set forth herein.

          SECTION  7.  Governing  Law.  This  agreement  shall be  governed  by,
interpreted  under,  and construed in  accordance  with the internal laws of the
State of New York, including, without limitation, Sections 5-1401, 5-1402 of the
New York  General  Obligations  Law and New York Civil  Practice  Laws and Rules
327(b).

          SECTION 8. Jurisdiction and Consent to Service. In accordance with the
laws of the State of New York, and without limiting the jurisdiction or venue of
any other  court,  the  parties  (a) agree that any suit,  action or  proceeding
arising  out of or  relating  to this  Agreement  may be brought in the state or
federal courts of New York;  (b) consent to the  non-exclusive  jurisdiction  of
each such court in any suit, action or proceeding  relating to or arising out of
the Transaction  Agreements;  (c) waive any objection which any of them may have
to the laying of venue in any such suit,  action or proceeding in any such court
and waive any defense of forum non conveniens; and

                                       14


(d) agree that service of any court paper in any such suit, action or proceeding
may be made in the same manner in which notices may be given pursuant to Section
9 of this Agreement:

          SECTION  9.  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 (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 (or in
accordance  with the  latest  unrevoked  written  direction  from  such  party),
provided the appropriate confirmation is received.

          (a)      if to World Heart, to:

                       World Heart Corporation
                       1 Laser Street
                       Nepean, Ontario
                       K2E 7V1
                       Attn: Chief Financial Officer
                       Fax: (613) 226-4744

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<PAGE>

                       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

           (b)      if to Edwards, to

                       Edwards Lifesciences LLC
                       One Edwards Way
                       Irvine, California  92614
                       Attn:  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

          SECTION 10. Interpretation. When a reference is made in this Agreement
to a Section,  such  reference  shall be to a Section of this  Agreement  unless
otherwise indicated.  The 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 11.  Severability.  If any provision of this  Agreement or the
application   of  any  such  provision   shall  be  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;

                                       16

<PAGE>

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 12.  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 and shall become
effective when one or more  counterparts have been signed by each of the parties
and delivered to the other parties.

          SECTION  13.  Entire  Agreement;  No Third Party  Beneficiaries.  This
Agreement and the other  Transaction  Agreements,  including all exhibits hereto
and thereto, by and between Edwards and World Heart,

          (a) constitute the entire agreement of the parties with respect to the
subject  matter hereof and supersede all prior and  contemporaneous  agreements,
representations,   understandings,  negotiations  and  discussions  between  the
parties, whether oral or written, with respect to the subject matter hereof; and

          (b) 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 13.

          SECTION 14.  Further  Assurances.  Each party hereto shall do all such
further  acts and  execute,  acknowledge,  deliver  and  file  all such  further
instruments and documents as may be necessary or desirable to give effect to and
carry out the transactions contemplated by this Agreement.

          SECTION 15. Amendments and Modifications; Waivers and Extensions.

          (a) 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.

          (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

                                       17

<PAGE>

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 16.  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 Edwards may
assign all its rights and  obligations to any transferee of the Put Shares.  Any
such  assignment  shall not affect the  requirement of Section 2(a) that the Put
Right be exercised for all, but not less than all, of the Put Shares. 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  17.  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 18. 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.


                                       18

<PAGE>

          IN WITNESS WHEREOF,  this Agreement has been signed by or on behalf of
the Edwards and World Heart, as of the date first written above.


                                       EDWARDS LIFESCIENCES LLC



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


                                       WORLD HEART CORPORATION



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


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