Table of Contents





|                                                                             |                                                                                          
|---------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------
|UNITED STATES                                                               
|SECURITIES AND EXCHANGE COMMISSION                                          
|Washington,
 D.C. 20549                                                     
|                                                                            
|                                                                            
|                                                                            
|FORM 10-Q                                                                   
|                                                                            
|                                                                            
|                                                                            
|x                                                                            | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
 THE SECURITIES EXCHANGE ACT OF 1934 
|                                                                             |                                                                                          
|for the quarterly
 period ended January 31, 2010.                           
|                                                                            
|OR                                                                          
|                                                                            
|o                                                                            | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
 THE SECURITIES EXCHANGE ACT OF 1934
|                                                                            
|for the transition period from
 ___________________ to ____________________.
|                                                                            
|Commission File Number
 001-13543                                           
|                                                                            
|                                                                            
|ANGEION CORPORATION                                                         
|(Exact name of registrant as specified in its charter)                      

| |                                 |  |                     | 
| | ------------------------------- |  | ------------------- | 
| | Minnesota                       |  | 41-1579150          | 
| | (State or other jurisdiction of |  | (IRS Employer       | 
| | incorporation or organization)  |  | Identification No.) | 

|                                                                   
|-------------------------------------------------------------------
|350
 Oak Grove Parkway, Saint Paul, Minnesota 55127-8599           
|(Address of principal executive offices)                           
|                                                                   
|Registrants telephone
 number, including area code: (651) 484-4874
|                                                                   

|                                                                                                                                                                                                                                                                                                                                                            
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Indicate by check mark whether the registrant (1) has filed all
 reports required to be filed by Section 13 or 15(d) of the Securities
 Exchange Act of 1934 during the preceding 12 months (or for such shorter
 period that the registrant was required to file such reports), and (2) has
 been subject to such filing requirements for the past 90 days.
|Yes
 x     Noo                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                                                                                                                                                                                                                                                            
|Indicate by check mark whether the registrant is a large accelerated
 filer, an accelerated filer or a non-accelerated filer. See definition of
 accelerated filer and large accelerated filer in Rule 12b-2 of the
 Exchange Act:                                                                                                                      

|                           |                      |                          |                             
|-------------------------- | -------------------- | ------------------------ | ----------------------------
|Large Accelerated
 Filer o | Accelerated
 Filer o | Non-Accelerated
 Filer o | Smaller
 Reporting Company x

|                                                                                                                  
|------------------------------------------------------------------------------------------------------------------
|Indicate by
 check mark whether the registrant is a shell company (as defined in Rule
 12b-2 of the Exchange Act).
|Yes
 o     Nox                                                                                                    
|                                                                                                                  
|As of March 1, 2010, the Company had outstanding 4,157,066 shares of Common Stock, $0.10 par value.               







TABLE OF
CONTENTS

|                                |                                                                                        |    |   
|------------------------------- | -------------------------------------------------------------------------------------- | -- | --
|PART I 
 FINANCIAL INFORMATION |                                                                                        |   
|                                |                                                                                        |   
|Item 1.                         | Financial Statements (unaudited)                                                       |    | 3 
|Item 2.                         | Managements Discussion and Analysis of Financial Condition and
 Results of Operations |    | 13
|Item 3.                         | Quantitative and Qualitative Disclosures about Market Risk                             |    | 17
|Item 4T.                        | Controls and Procedures                                                                |    | 17
|                                |                                                                                        |   
|PART II - OTHER INFORMATION     |                                                                                        |   
|                                |                                                                                        |   
|Item 1.                         | Legal Proceedings                                                                      |    | 18
|Item 1A.                        | Risk Factors                                                                           |    | 18
|Item 2.                         | Unregistered Sales of Equity Securities and Use of Proceeds                            |    | 18
|Item 3.                         | Defaults Upon Senior Securities                                                        |    | 18
|Item 4.                         | Other Information                                                                      |    | 18
|Item 5.                         | Exhibits                                                                               |    | 19
|                                |                                                                                        |    |   
|SIGNATURES                      |                                                                                        | 20

2

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Table of Contents

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

ANGEION CORPORATION AND SUBSIDIARIES 
Consolidated Balance Sheets
January 31, 2010 and October 31, 2009(in thousands except
share and per share data)

|                                                                                                                                                                                |  |                   |        |                   |   |        |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------- | ------ | ----------------- | - | ------ | -
|                                                                                                                                                                                |  | January 31,
 2010 |        | October 31,
 2009 |  
|                                                                                                                                                                                |  | (unaudited)       |        |                   |  
|Assets                                                                                                                                                                          |  |                   |        |                   |   |        |  
|Current assets:                                                                                                                                                                 |  |                   |        |                   |   |        |  
|Cash and cash equivalents                                                                                                                                                       |  | $                 | 10,504 |                   | $ | 11,219 |  
|Accounts receivable, net of allowance for doubtful accounts of $131
 and $110, respectively                                                                                     |  |                   | 4,634  |                   |   | 4,510  |  
|Inventories, net of obsolescence reserve of $724 and $645,
 respectively                                                                                                        |  |                   | 4,077  |                   |   | 4,371  |  
|Prepaid expenses and other current assets                                                                                                                                       |  |                   | 132    |                   |   | 243    |  
|Total current assets                                                                                                                                                            |  |                   | 19,347 |                   |   | 20,343 |  
|                                                                                                                                                                                |  |                   |        |                   |   |        |  
|Property and equipment, net of accumulated depreciation of $3,389 and
 $3,305, respectively                                                                                     |  |                   | 684    |                   |   | 698    |  
|Intangible assets, net                                                                                                                                                          |  |                   | 1,332  |                   |   | 1,422  |  
|Total Assets                                                                                                                                                                    |  | $                 | 21,363 |                   | $ | 22,463 |  
|                                                                                                                                                                                |  |                   |        |                   |   |        |  
|Liabilities and Shareholders Equity                                                                                                                                            |  |                   |        |                   |   |        |  
|Current liabilities:                                                                                                                                                            |  |                   |        |                   |   |        |  
|Accounts payable                                                                                                                                                                |  | $                 | 1,768  |                   | $ | 1,771  |  
|Employee compensation                                                                                                                                                           |  |                   | 1,071  |                   |   | 1,375  |  
|Deferred income                                                                                                                                                                 |  |                   | 1,406  |                   |   | 1,579  |  
|Warranty reserve                                                                                                                                                                |  |                   | 145    |                   |   | 143    |  
|Other current liabilities and accrued expenses                                                                                                                                  |  |                   | 300    |                   |   | 323    |  
|Total current liabilities                                                                                                                                                       |  |                   | 4,690  |                   |   | 5,191  |  
|                                                                                                                                                                                |  |                   |        |                   |   |        |  
|Long-term liabilities:                                                                                                                                                          |  |                   |        |                   |   |        |  
|Long-term deferred income and other                                                                                                                                             |  |                   | 706    |                   |   | 718    |  
|Total Liabilities                                                                                                                                                               |  |                   | 5,396  |                   |   | 5,909  |  
|                                                                                                                                                                                |  |                   |        |                   |   |        |  
|Shareholders equity:                                                                                                                                                           |  |                   |        |                   |   |        |  
|Common stock, $0.10 par value, authorized 25,000,000 shares, 4,387,510
 and 4,380,817 shares issued and 4,157,066 and 4,150,371 shares outstanding
 2010 and 2009, respectively |  |                   | 416    |                   |   | 415    |  
|Additional paid-in capital                                                                                                                                                      |  |                   | 22,059 |                   |   | 21,821 |  
|Accumulated deficit                                                                                                                                                             |  |                   | (6,508 | )                 |   | (5,682 | )
|Total shareholders equity                                                                                                                                                      |  |                   | 15,967 |                   |   | 16,554 |  
|Commitments and contingencies (Note 9)                                                                                                                                          |  |                   |       |                   |   |       |  
|Total Liabilities and Shareholders Equity                                                                                                                                      |  | $                 | 21,363 |                   | $ | 22,463 |  

See accompanying notes to
consolidated financial statements.

3

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Table of Contents

ANGEION CORPORATION AND SUBSIDIARIES
Consolidated Statements of Operations(in thousands except
per share amounts)

|                                           |  |                                  |       |      |   |       |  
|------------------------------------------ |  | -------------------------------- | ----- | ---- | - | ----- | -
|                                           |  | Three Months Ended 
 January 31, |      
|                                           |  | 2010                             |       | 2009 |  
|Revenues                                   |  |                                  |       |      |   |       |  
|Equipment and supply sales                 |  | $                                | 5,790 |      | $ | 5,570 |  
|Service revenue                            |  |                                  | 825   |      |   | 861   |  
|                                           |  |                                  | 6,615 |      |   | 6,431 |  
|Cost of revenues                           |  |                                  |       |      |   |       |  
|Cost of equipment and supplies             |  |                                  | 3,151 |      |   | 3,048 |  
|Cost of service revenue                    |  |                                  | 97    |      |   | 81    |  
|                                           |  |                                  | 3,248 |      |   | 3,129 |  
|Gross margin                               |  |                                  | 3,367 |      |   | 3,302 |  
|                                           |  |                                  |       |      |   |       |  
|Operating expenses:                        |  |                                  |       |      |   |       |  
|Selling and marketing                      |  |                                  | 1,942 |      |   | 1,798 |  
|General and administrative                 |  |                                  | 1,102 |      |   | 1,154 |  
|Research and development                   |  |                                  | 1,039 |      |   | 787   |  
|Amortization of intangibles                |  |                                  | 105   |      |   | 182   |  
|                                           |  |                                  | 4,188 |      |   | 3,921 |  
|                                           |  |                                  |       |      |   |       |  
|Operating loss                             |  |                                  | (821  | )    |   | (619  | )
|Interest income                            |  |                                  | 3     |      |   | 4     |  
|                                           |  |                                  |       |      |   |       |  
|Loss before taxes                          |  |                                  | (818  | )    |   | (615  | )
|Provision for taxes                        |  |                                  | 8     |      |   | 7     |  
|                                           |  |                                  |       |      |   |       |  
|Net loss                                   |  | $                                | (826  | )    | $ | (622  | )
|                                           |  |                                  |       |      |   |       |  
|Loss per share - basic                     |  |                                  |       |      |   |       |  
|Net loss per share                         |  | $                                | (0.20 | )    | $ | (0.15 | )
|                                           |  |                                  |       |      |   |       |  
|Loss per share - diluted                   |  |                                  |       |      |   |       |  
|Net loss per share                         |  | $                                | (0.20 | )    | $ | (0.15 | )
|                                           |  |                                  |       |      |   |       |  
|Weighted average common shares outstanding |  |                                  |       |      |   |       |  
|Basic                                      |  |                                  | 4,153 |      |   | 4,101 |  
|Diluted                                    |  |                                  | 4,153 |      |   | 4,101 |  

See accompanying notes to
consolidated financial statements.

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Table of Contents

ANGEION CORPORATION AND SUBSIDIARIES
Consolidated Statements of Cash Flows(in thousands)

|                                                                             |  |                                  |        |      |   |       |  
|---------------------------------------------------------------------------- |  | -------------------------------- | ------ | ---- | - | ----- | -
|                                                                             |  | Three months ended 
 January 31, |       
|                                                                             |  | 2010                             |        | 2009 |  
|Cash Flows From Operating Activities:                                        |  |                                  |        |      |   |       |  
|Net loss                                                                     |  | $                                | (826   | )    | $ | (622  | )
|Adjustments to reconcile net loss to net cash used in operating
 activities: |  |                                  |        |      |   |       |  
|Depreciation and amortization                                                |  |                                  | 195    |      |   | 293   |  
|Stock-based compensation                                                     |  |                                  | 222    |      |   | 182   |  
|Increase in inventory obsolescence reserve                                   |  |                                  | 79     |      |   | 107   |  
|Increase / (decrease) in allowance for doubtful accounts                     |  |                                  | 21     |      |   | (102  | )
|Changes in operating assets and liabilities:                                 |  |                                  |        |      |   |       |  
|Accounts receivable                                                          |  |                                  | (145   | )    |   | 48    |  
|Inventories                                                                  |  |                                  | 238    |      |   | (59   | )
|Prepaid expenses and other current assets                                    |  |                                  | 111    |      |   | 79    |  
|Accounts payable                                                             |  |                                  | (3     | )    |   | (17   | )
|Employee compensation                                                        |  |                                  | (304   | )    |   | (165  | )
|Deferred income                                                              |  |                                  | (211   | )    |   | (137  | )
|Warranty reserve                                                             |  |                                  | 2      |      |   | (2    | )
|Other current liabilities and accrued expenses                               |  |                                  | (23    | )    |   | (29   | )
|Net cash used in operating activities                                        |  |                                  | (644   | )    |   | (424  | )
|                                                                             |  |                                  |        |      |   |       |  
|Cash Flows From Investing Activities:                                        |  |                                  |        |      |   |       |  
|Purchase of property and equipment and intangible assets                     |  |                                  | (88    | )    |   | (24   | )
|Net cash used in investing activities                                        |  |                                  | (88    | )    |   | (24   | )
|                                                                             |  |                                  |        |      |   |       |  
|Cash Flows From Financing Activities:                                        |  |                                  |        |      |   |       |  
|Borrowings under bank line of credit                                         |  |                                  |        |      |   |       |  
|Payments under bank line of credit                                           |  |                                  |        |      |   |       |  
|Proceeds from issuance of common stock under employee stock purchase
 plan   |  |                                  | 10     |      |   | 11    |  
|Proceeds from the exercise of stock options                                  |  |                                  | 7      |      |   | 63    |  
|Proceeds from the exercise of warrants                                       |  |                                  |       |      |   |      |  
|Tax benefit from stock options exercised                                     |  |                                  |       |      |   |      |  
|Net cash provided by financing activities                                    |  |                                  | 17     |      |   | 74    |  
|                                                                             |  |                                  |        |      |   |       |  
|Net decrease in cash and cash equivalents                                    |  |                                  | (715   | )    |   | (374  | )
|                                                                             |  |                                  |        |      |   |       |  
|Cash and cash equivalents at beginning of period                             |  |                                  | 11,219 |      |   | 9,047 |  
|                                                                             |  |                                  |        |      |   |       |  
|Cash and cash equivalents at end of period                                   |  | $                                | 10,504 |      | $ | 8,673 |  

See
accompanying notes to consolidated financial statements.

5

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Table of Contents

ANGEION
CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

|   |                                                  
|-- | -------------------------------------------------
|1. | Basis of Presentation and Description of Business

Angeion
Corporation (the Company), through its Medical Graphics Corporation subsidiary, designs and
markets non-invasive cardiorespiratory diagnostic systems that are sold under
the MedGraphics and New Leaf brand and trade names. These cardiorespiratory
diagnostic systems have a wide range of applications in healthcare, wellness,
and health and fitness.

The
consolidated balance sheet as of January 31, 2010, the consolidated
statements of operations and cash flows for the three months ended January
31, 2010 and 2009, and the related
information presented in these notes have been prepared by management in accordance
with U.S. generally accepted accounting principles for interim financial
information and with the instructions to Form 10-Q and Rule 10-01 of Regulation
S-X, without audit. Accordingly, they do not include all of the information and
notes required by U.S. generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments considered
necessary for a fair presentation of results have been included. The
consolidated balance sheet at October 31, 2009 was derived from the audited
consolidated financial statements as of that date. Operating results for the
three months ended January 31, 2010
are not necessarily indicative of the results that may be expected for the year
ending October 31, 2010. For further information, refer to the consolidated
financial statements and notes thereto included in Angeion Corporations Annual
Report on Form 10-K for the year ended October 31, 2009.

Comprehensive
income (loss) is a measure of all non-owner changes in shareholders equity and
includes items such as net income, certain foreign currency translation items,
minimum pension liability adjustments and changes in the value of
available-for-sale securities. For the three months ended January 31, 2010 and 2009, comprehensive income (loss) for Angeion Corporation was
equivalent to net income (loss) as reported.

Preparation
of the consolidated financial statements in conformity with U.S. generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosures of contingent assets and liabilities made in the consolidated
financial statements and accompanying notes. Actual results could differ from
those estimates. Estimates include accounts receivable, product warranty and
inventory reserves, valuation of stock options and related stock-based
compensation, and depreciable lives of property, equipment and intangible
assets.

The Company determined there were no subsequent
events which required recognition or disclosure in these consolidated financial statements.

|   |                    
|-- | -------------------
|2. | Revenue Recognition

The
Company recognizes revenue when persuasive evidence of an arrangement exists,
transfer of title has occurred or services have been rendered, the selling
price is fixed or determinable and collectability is reasonably assured. The
Companys products are sold for cash or on credit terms requiring payment based
on the shipment date. Credit terms can vary between customers due to many
factors, but are generally 30-60 days. Revenue, net of discounts, is recognized
upon shipment or delivery to customers in accordance with written sales terms.
Standard sales terms do not include customer acceptance conditions, future
credits, rebates, price protection or general rights of return. The terms of
sales to both domestic customers and international distributors are identical.
In instances when a customer order specifies final acceptance of the system,
revenue is deferred until all customer acceptance criteria have been met.
Estimated warranty obligations are recorded upon shipment.

6

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Table of Contents

Service
contract revenue is based on a stated contractual rate and is deferred and
recognized ratably over the service period, which is typically from one to four
years. Deferred income associated with
service contracts and supplies was
$1,933,000 and $2,022,000 at January 31, 2010 and October 31, 2009,
respectively. Revenue from installation and training services provided
to customers is deferred until the service has been performed. The amount of
deferred installation and training revenue was $117,000 and $131,000 at January
31, 2010 and October 31, 2009, respectively.

When a sale
involves multiple deliverables, such as equipment, installation services and
training, the amount of the consideration from an arrangement is allocated to
each respective element based on the residual method and recognized as revenue
when revenue recognition criteria for each element is met. Consideration
allocated to delivered equipment is equal to the total arrangement
consideration less the fair value of installation and training. The fair value
of installation and training services is based on specific objective evidence,
including third-party invoices.

No customer
accounted for more than 10% of revenue for the quarters ended January 31, 2010
and 2009.

Advance
Payments from Customers

The
Company typically does not receive advance payments from its customers in
connection with the sale of its products. The Company occasionally enters into
an arrangement under which a customer agrees to purchase a large quantity of
product that is to be delivered over a period of time. Depending on the size of
these arrangements, the Company may negotiate an advance payment from these
customers. At January 31, 2010, advance payments from customers aggregated
$50,000, of which $43,000 was from a single customer, and at October 31, 2009,
advance payments from customers aggregated $144,000, of which $81,000 was from
a single customer. Revenue recognition for customer orders that include advance
payments is consistent with the Companys revenue recognition policy described
above.

|   |                                           
|-- | ------------------------------------------
|3. | Share-Based Compensation and Stock Options

The
Angeion Corporation 2007 Stock Incentive Plan (the 2007 Plan) and the Angeion
Corporation 2002 Stock Option Plan (the 2002 Plan) both provide that
incentive stock options and nonqualified stock options to purchase shares of
common stock may be granted at prices determined by the Compensation Committee,
except that the purchase price of incentive stock options may not be less than
the fair market value of the stock at date of grant. Under the 2007 Plan, all
options expire no later than seven years from the grant date while under the
2002 Plan, all options expire no later than ten years from the grant date.
Options under both plans are subject to various vesting schedules. In addition,
the 2007 Plan allows the granting of restricted stock awards, stock
appreciation rights and performance stock.

Total
share-based compensation expense included in the Companys statement of
operations for the three months ended January 31, 2010 and 2009 was $222,000
and $182,000, respectively.

7

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Table of Contents

Stock
Options

|                                   |  |                       |         |                                    |   |        |  |                                    |         |   |   |      | 
|---------------------------------- |  | --------------------- | ------- | ---------------------------------- | - | ------ |  | ---------------------------------- | ------- | - | - | ---- | 
|                                   |  | For the quarter ended |        
|                                   |  | January 31, 2010      |         | January 31, 2009                   |  
|                                   |  | Shares                |         | Weighted
 Average
 Exercise
 Price |   | Shares |  | Weighted
 Average
 Exercise
 Price |        
|Outstanding at beginning of period |  |                       | 695,787 |                                    | $ | 6.13   |  |                                    | 730,953 |   | $ | 5.96 | 
|Granted                            |  |                       |        |                                    |   |       |  |                                    |        |   |   |     | 
|Exercised                          |  |                       | (3,000  | )                                  |   | 2.00   |  |                                    | (25,000 | ) |   | 2.53 | 
|Expired or cancelled               |  |                       | (20,300 | )                                  |   | 7.18   |  |                                    |        |   |   |     | 
|Outstanding at end of period       |  |                       | 672,487 |                                    | $ | 6.12   |  |                                    | 705,953 |   | $ | 6.08 | 

The
following table summarizes information concerning stock options outstanding as
of January 31, 2010:

|                 |       |                     |  |                                                  |         |                                    |  |                              |  |   |      |  |  |         | 
|---------------- | ----- | ------------------- |  | ------------------------------------------------ | ------- | ---------------------------------- |  | ---------------------------- |  | - | ---- |  |  | ------- | 
|Exercise
 Prices |       | Number
 Outstanding |  | Weighted
 Average
 Remaining
 Contractual 
 Life |         | Weighted
 Average
 Exercise
 Price |  | Number
 Subject to
 Exercise | 
|$                | 2.00  |                     |  |                                                  | 8,650   |                                    |  | 3.68                         |  | $ | 2.00 |  |  | 8,650   | 
|                 | 2.53  |                     |  |                                                  | 62,000  |                                    |  | 4.88                         |  |   | 2.53 |  |  | 62,000  | 
|                 | 5.08  |                     |  |                                                  | 84,000  |                                    |  | 5.14                         |  |   | 5.08 |  |  | 84,000  | 
|                 | 5.16  |                     |  |                                                  | 48,834  |                                    |  | 5.57                         |  |   | 5.16 |  |  | 16,347  | 
|                 | 5.66  |                     |  |                                                  | 90,000  |                                    |  | 5.30                         |  |   | 5.66 |  |  | 30,003  | 
|                 | 6.23  |                     |  |                                                  | 76,500  |                                    |  | 3.55                         |  |   | 6.23 |  |  | 76,500  | 
|                 | 6.60  |                     |  |                                                  | 71,583  |                                    |  | 4.41                         |  |   | 6.60 |  |  | 52,175  | 
|                 | 7.08  |                     |  |                                                  | 10,000  |                                    |  | 5.17                         |  |   | 7.08 |  |  | 3,334   | 
|                 | 7.79  |                     |  |                                                  | 74,500  |                                    |  | 3.68                         |  |   | 7.79 |  |  | 74,500  | 
|                 | 7.81  |                     |  |                                                  | 2,000   |                                    |  | 4.76                         |  |   | 7.81 |  |  | 1,334   | 
|                 | 7.86  |                     |  |                                                  | 144,420 |                                    |  | 4.75                         |  |   | 7.86 |  |  | 96,290  | 
|                 |       |                     |  |                                                  |         |                                    |  |                              |  |   |      |  |  |         | 
|                 | Total |                     |  |                                                  | 672,487 |                                    |  | 4.65                         |  | $ | 6.12 |  |  | 505,133 | 

The
total intrinsic value of options exercised during the three months ended
January 31, 2010 and 2009 was $5,000 and $15,000, respectively. The total
intrinsic value of options outstanding and exercisable at January 31, 2010 was
$96,000, which was calculated using the closing stock price of $3.83 as of
January 29, 2010 (the last trading day of the quarter) less the option price of
in-the-money options. The Company issues new shares when stock options are
exercised. Cash received from the exercise of stock options for the three
months ended January 31, 2010 and 2009 was $7,000 and $63,000, respectively,
and there was no related tax benefit realized due to the Companys current tax
loss position. Unrecognized compensation expense related to outstanding stock
options as of January 31, 2010 was $502,000 and is expected to be recognized
over a weighted average period of 1.07 years and will be adjusted for any
future changes in estimated forfeitures.

Valuation
Assumptions

The
Company uses the Black-Scholes option-pricing model (Black-Scholes model) to
determine the fair value of stock options as of the grant date. The fair value
of stock options under the Black-Scholes model requires management to make
assumptions regarding projected employee stock option exercise behaviors,
risk-free interest rates, volatility of the Companys stock price and expected
dividends. The Company did not grant any options during the quarter ended
January 31, 2010 or 2009.

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Table of Contents

Restricted
Stock Awards

On
August 28, 2008 and June 3, 2009, the Board of Directors authorized the
issuance of 74,667 and 180,668 restricted shares, respectively, of the
Companys common stock. Restricted stock awards are awards of common stock that
are subject to restrictions on transfer and to a risk of forfeiture if the
awardee leaves the Company before the restrictions lapse. The holder of a restricted
stock award is generally entitled at all times on and after the date of
issuance of the restricted shares to exercise the rights of a shareholder of
the Company, including the right to vote the shares. The value of each
restricted stock award is established by the market price on the date of grant.
The restricted stock awards will vest over a three-year period and are included
in common stock issued as of the grant date. The Company did not grant any
restricted stock awards during the quarter ended January 31, 2010 and 2009.

Unrecognized
compensation expense related to outstanding restricted stock awards as of
January 31, 2010 was $571,000 and is expected to be recognized over a weighted
average period of 2.10 years. The Company did not grant any restricted stock
awards prior to fiscal year 2008.

The
following table presents the statement of operations classification of pre-tax
share-based compensation expense recognized for the three months ended January
31, 2010:

|                                  |  |                                |     |      |   |     | 
|--------------------------------- |  | ------------------------------ | --- | ---- | - | --- | 
|                                  |  | Three months ended January 31, |    
|(In
 thousands)                   |  | 2010                           |     | 2009 |  
|Cost of
 goods sold               |  | $                              | 15  |      | $ | 13  | 
|Selling and
 marketing            |  |                                | 46  |      |   | 35  | 
|General and
 administrative       |  |                                | 137 |      |   | 114 | 
|Research and
 development         |  |                                | 24  |      |   | 20  | 
|Share-based
 compensation expense |  | $                              | 222 |      | $ | 182 | 

Employee
Stock Purchase Plan

The
Angeion Corporation 2003 Employee Stock Purchase Plan (Stock Plan) allows
participating employees to purchase shares of the Companys common stock at a
discount through payroll deductions. The Stock Plan is available to all
employees subject to certain eligibility requirements. Terms of the Stock Plan
provide that participating employees may purchase the Companys common stock on
a voluntary after tax basis. Employees may purchase the Companys common stock
at a price that is no less than the lower of 85% of the fair market value of
one share of common stock at the beginning or end of each stock purchase period
or phase. The Company increased the price at which common stock may be
purchased to 95% of the market value effective January 1, 2007. The Stock Plan
is carried out in six-month phases, with phases beginning on January 1 and July
1 of each calendar year. For the phase that ended on December 31, 2009,
employees purchased 3,695 shares at a price of $2.80 per share. As of January
31, 2010, the Company has withheld approximately $1,600 from employees
participating in the phase that began on January 1, 2010. At January 31, 2010,
approximately 56,655 shares of common stock were available for future purchase
under the Stock Plan.

9

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|   |                                                                                  
|-- | ---------------------------------------------------------------------------------
|4. | Inventories                                                                      
|   |                                                                                  
|   | Inventories
 consisted of the following at January 31, 2010 and October 31, 2009:

|                |  |      |       |      |   |       | 
|--------------- |  | ---- | ----- | ---- | - | ----- | 
|(In
 thousands) |  | 2010 |       | 2009 |  
|Raw
 materials  |  | $    | 1,365 |      | $ | 1,602 | 
|Work-in-Process |  |      | 154   |      |   | 163   | 
|Finished
 goods |  |      | 2,558 |      |   | 2,606 | 
|                |  | $    | 4,077 |      | $ | 4,371 | 

|   |                                                                                        
|-- | ---------------------------------------------------------------------------------------
|5. | Intangible Assets                                                                      
|   |                                                                                        
|   | Intangible
 assets consisted of the following at January 31, 2010 and October 31, 2009:

|                                     |  |      |        |      |   |        |  
|------------------------------------ |  | ---- | ------ | ---- | - | ------ | -
|(In
 thousands)                      |  | 2010 |        | 2009 |  
|Intangible
 assets:                  |  |      |        |      |   |        |  
|Developed
 technology                |  | $    | 6,777  |      | $ | 6,764  |  
|Trademarks
 (unamortized)            |  |      | 61     |      |   | 59     |  
|                                     |  | $    | 6,838  |      | $ | 6,823  |  
|                                     |  |      |        |      |   |        |  
|Amortization
  developed technology |  |      | (5,506 | )    |   | (5,401 | )
|                                     |  | $    | 1,332  |      | $ | 1,422  |  

The
intangible assets are being amortized using the straight-line method over the
estimated useful lives of the assets that range from seven to ten years.
Amortization expense was $105,000 for the quarter ended January 31, 2010 and
$182,000 for the same quarter in fiscal 2009. Estimated amortization expense
for each of the succeeding fiscal years based on the intangible assets as of
January 31, 2010 is as follows:

|                                     |  |              |       | 
|------------------------------------ |  | ------------ | ----- | 
|(In
 thousands)                      |  | Amortization |      
|Nine months
 ending October 31, 2010 |  | $            | 315   | 
|2011                                 |  |              | 421   | 
|2012                                 |  |              | 421   | 
|                                     |  | $            | 1,157 | 

The
above table does not include estimated amortization expense for patents of
$114,000, included in developed technology, that are not yet placed in service.

|   |                 
|-- | ----------------
|6. | Warranty Reserve

Sales
of the Companys equipment are subject to a warranty obligation. Equipment
warranties typically extend for a period of twelve months from the date of
installation. Standard warranty terms are included in customer contracts. Under
the terms of these warranties, the Company is obligated to repair or replace
any components or assemblies that it deems defective in workmanship or
materials. The Company reserves the right to reject warranty claims where it
determines that failure is due to normal wear, customer modifications, improper
maintenance or misuse. The Company maintains a warranty reserve that reflects
the estimated expenses that it will incur to honor the warranties on its
products. The Company adjusts the warranty reserve based on the number and type
of equipment that is subject to warranty, adjusted for the remaining months of
warranty coverage. The warranty reserve adjustment reflects the Companys
historical warranty experience based on type of equipment. Warranty provisions and claims for the
three months ended January 31, 2010 and 2009 were as follows:

|                              |  |      |     |      |   |     |  
|----------------------------- |  | ---- | --- | ---- | - | --- | -
|(In
 thousands)               |  | 2010 |     | 2009 |  
|Balance,
 beginning of period |  | $    | 143 |      | $ | 157 |  
|Warranty provisions           |  |      | 49  |      |   | 53  |  
|Warranty claims               |  |      | (47 | )    |   | (55 | )
|Balance, end
 of period       |  | $    | 145 |      | $ | 155 |  

10

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|   |                   
|-- | ------------------
|7. | Net Loss per Share

Basic
loss per share is computed by dividing net loss by the weighted average shares
outstanding during the reporting period. Diluted loss per share is computed
similarly to basic loss per share except that in computing income per share the
weighted average shares outstanding are increased to include additional shares
from the assumed exercise of stock options or warrants, if dilutive. The number
of additional shares is calculated by assuming that outstanding stock options
or warrants were exercised and that the proceeds from the exercise were used to
acquire shares of common stock at the average market price during the reporting
period.

As
a result of the net loss in first quarter 2010 and 2009, the outstanding stock
options and unvested restricted stock shares were considered antidilutive and,
therefore, were excluded from diluted earnings per share.

|   |             
|-- | ------------
|8. | Income Taxes

The
Company has recorded a provision for taxes from continuing operations of $8,000
and $7,000 for the three months ended January 31, 2010 and 2009, respectively.
The Company believes it is more likely than not that the Company will report a
year-to-date loss, therefore, no tax benefit was recorded.

The
Company adopted the provisions of ASC 740-10, Income
Taxes Related to Accounting For Uncertainties in Income Taxes, on
November 1, 2007. At October 31, 2009, the reserve was $35,200 and was not
changed during the first quarter of fiscal 2010. The entire amount of the
reserve related to uncertainties regarding income tax nexus with various states
in which the Company operates. Included in the reserve is $10,300 of estimated
interest and penalties. The total amount of the reserve has increased the
Companys effective tax rate, and would therefore decrease the effective tax
rate if removed.

Estimated
interest and penalties related to potential underpayment of income taxes are
classified as a component of tax expense in the consolidated statement of
operations. Although the Company believes the amount of reserves for uncertain
tax positions may change in the next twelve months, the Company does not
anticipate that the total reserve for uncertain tax positions will
significantly change due to the settlement of audits and the expiration of
statutes of limitations within the next twelve months.

The
Company files a consolidated federal income tax return in the United States
Federal jurisdiction and files various combined and separate tax returns in
several state and local jurisdictions. With limited exceptions, the Company is
no longer subject to U.S. Federal, state and local tax examinations by tax
authorities for fiscal years ending prior to November 1, 2005. There is no
statute of limitations for assessments related to jurisdictions where the
Company may have nexus but has chosen not to file an income tax return.

11

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Table of Contents

The
Company had a federal net operating loss carry forward at October 31, 2009 of
approximately $17.8 million. This amount is the remaining utilizable carry
forward following the application of a limit due to an ownership change under
Internal Revenue Code Section 382 that occurred as a result of a significant
change in ownership that occurred during the fourth quarter of fiscal year
2006. If not used, these loss carry forwards will expire in the years 2010
through 2025. The Company also has $109,000 of alternative minimum tax credit
carry forwards that do not have expiration dates. Even though the Company has
substantial federal net operating loss carry forwards, any income may still be
subject to U.S. and State alternative minimum taxes.

The
Company has recorded a full valuation allowance against its net deferred tax
asset because it cannot demonstrate that it is more likely than not that the
asset would be realized in the future. Although this determination was made in
a prior fiscal year, it is still applicable as of January 31, 2010, and the
Company will continue to assess the need for a full valuation allowance in
future quarters. Any reduction of the valuation allowance related to
post-bankruptcy net operating losses and other deferred tax assets would (i)
first affect earnings as a reduction in the provision for taxes and (ii)
thereafter, the remaining $0.8 million would increase additional paid-in
capital as these deferred tax assets represent employee stock-based
compensation tax deductions included in the Companys net operating losses.

|   |           
|-- | ----------
|9. | Litigation

The
Company is also subject to certain claims and lawsuits that have been filed in
the ordinary course of business. From time to time, the Company initiates
lawsuits against others to enforce patents or to seek collection of debts in
the ordinary course of business. There are no known current lawsuits or other
litigation that involve the Company. It is managements opinion that the
settlement of all litigation arising in the ordinary course of business would
not have a material effect on the financial position, results of operations or
liquidity of the Company.

12

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Table of Contents

Item 2. Managements
Discussion and Analysis of Financial Condition and Results of Operations

Overview

The
Company, through its Medical Graphics Corporation subsidiary, designs and
markets non-invasive cardio-respiratory diagnostic systems that are sold under
the MedGraphics and New Leaf brand and trade names. These cardio-respiratory
diagnostic systems have a wide range of applications in healthcare, wellness
and health and fitness. Revenue consists of equipment and supply sales as well
as service revenues. Equipment and supply sales reflect sales of non-invasive
cardio-respiratory diagnostic equipment and aftermarket sales of peripherals
and supplies. Service revenue consists of revenue from extended service
contracts, non-warranty service visits and additional training.

During
the first quarter of 2010, Angeion strengthened its marketing and sales teams
by adding two new experienced professionals with backgrounds in the medical
device market. The
Company also initiated a sales and marketing program to establish a
network of independent sales representatives and distributors that will market
both MedGraphics supplies such as filters and low-cost MedGraphics equipment
such as table-top and hand-held spirometers. Angeion also is in the process of
establishing an online web store to offer MedGraphics and New Leaf products
over the internet.

Total
revenue for the first quarter of 2010 was $6.6 million, an increase of 2.9%
from $6.4 million in 2009. Operating expense for the first quarter of 2010 was
$4.2 million, an increase of 6.8% from $3.9 million in 2009. Net loss for the
quarter was $826,000, or $0.20 per share, compared to a net loss of $622,000,
or $0.15 per diluted share, for the same period in 2009.

For
a discussion of risks associated with our business, see the section entitled
Forward Looking Statements on page 16 of this Form 10-Q.

Results of Operations

The following table contains selected information from the
Companys consolidated statements of operations, expressed as a percentage of
revenues:

|                                    |  |                    |       |      |  |       |   
|----------------------------------- |  | ------------------ | ----- | ---- |  | ----- | --
|                                    |  | Three months ended |      
|                                    |  | January 31,        |      
|                                    |  | 2010               |       | 2009 | 
|                                    |  |                    |       |      |  |       |   
|Revenues                            |  |                    | 100.0 | %    |  | 100.0 | % 
|Cost of revenue                     |  |                    | 49.1  |      |  | 48.7  |   
|Gross margin                        |  |                    | 50.9  |      |  | 51.3  |   
|                                    |  |                    |       |      |  |       |   
|Selling and marketing expenses      |  |                    | 29.4  |      |  | 28.0  |   
|General and administrative expenses |  |                    | 16.6  |      |  | 17.9  |   
|Research and development expenses   |  |                    | 15.7  |      |  | 12.2  |   
|Amortization of intangibles         |  |                    | 1.6   |      |  | 2.8   |   
|Total operating expenses            |  |                    | 63.3  |      |  | 60.9  |   
|Operating loss                      |  |                    | (12.4 | )    |  | (9.6  | ) 
|Interest income                     |  |                    | 0.0   |      |  | 0.0   |   
|Provision for taxes                 |  |                    | 0.1   |      |  | 0.1   |   
|Net loss                            |  |                    | (12.5 | )%   |  | (9.7  | )%

13

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Table of Contents

The
following paragraphs discuss the Companys performance for the three months
ended January 31, 2010 and 2009.

Revenue

Total
revenue for the three months ended January 31, 2010, increased by 2.9% compared
to 2009. Domestic product revenue decreased 1.5%, international product revenue
increased 17.3% and service revenue decreased 4.1%. International revenue
increased as a result of the introduction of the CPX Express cardiopulmonary
exercise system that was introduced late in fiscal 2009. The domestic business
decreased slightly as a result of the challenge of the current economic
environment where a number of hospitals and other health care providers
continue to keep tight controls on capital spending. The decline in service
revenues was due to a 5.1% reduction in billable service revenue for the period
ended January 31, 2010 compared to the prior year.

Gross Margin

Gross
margin percentage for the three month period ended January 31, 2010 decreased
slightly to 50.9% of revenue compared to 51.3% for the same period in 2009.
Gross margin percentage decreased slightly as a result of an increase in inventory
reserves during the first quarter of 2010 compared to prior year.

Selling and Marketing

Selling
and marketing expense for the three months ended January 31, 2010 increased by
8.0%, or $144,000, to $1.9 million compared to $1.8 million for the same period
in 2009.

The
sales and sales support payroll, travel and support expense increased by
$79,000, or 6.7%, for the three months ended January 31, 2010 compared to the
same period in 2009. The Company is investing in additional personnel to
improve our market position as we believe we are beginning to emerge from the recessionary
environment. Stock-based compensation also increased by $11,000 due to the
issuance of restricted stock awards on June 3, 2009.

Demonstration
equipment expense for the three months ended January 31, 2010 was up $57,000
compared to the same period in 2009 due to the periodic write-off of aging
equipment.

General and Administrative

General
and administrative expenses for the three months ended January 31, 2010
decreased by $52,000, to $1.1 million compared to $1.2 million for the same
period in 2009.

Professional
fees decreased by $20,000 for the three months ended January 31, 2010 compared
to the same period in 2009 mainly due to lower legal fees incurred. In
addition, personnel expenses, including consulting, decreased by $32,000 over
the same period.

The
Companys provision for bad debts also decreased by $25,000 for the three month
period ended January 31, 2010 compared to the prior year. This was partially
offset by additional non-cash stock-based compensation expense of $23,000 that
was incurred during the three months ended January 31, 2010 compared to January
31, 2009 as a result of the grant of restricted stock awards on June 3, 2009.

14

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Research and Development

Research
and development expenses for the three months ended January 31, 2010 increased
by 32.0%, or $252,000, to $1.0 million from $787,000 for the same period in
2009.

Payroll
and benefits costs increased $38,000 as part of the Companys investment in the
development of new product initiatives. Project expenses associated with new
product development increased by $227,000, or 223%, for the three months ended
January 31, 2010 compared to the same period in 2009 to further the Companys
commitment to research and development.

The
Company believes these investments will result in technological improvements to
existing products or entirely new product offerings. Our current product
development initiatives include new or updated products targeted for hospital
intensive care units, cardiology, dietary, asthma, allergy and primary care
physicians, and health and fitness club professionals. In addition to selling
these products in the United States, the Company intends to introduce some of
these new products internationally as well as continuing to expand the
international distribution of its existing products.

Amortization of Intangibles

Amortization
of developed technology was $105,000 for the three months ended January 31,
2010, a decrease of $77,000 from the comparable period in 2009 as a portion of
the Companys developed technology was fully amortized as of October 31, 2009.

Interest Income

Interest income for the three months ended
January 31, 2010 decreased to $3,000
from $4,000 for the same period in 2009. Interest income has decreased since the start of the economic recession
principally as a result of significantly lower market interest rates when the
Company moved its invested cash and cash equivalents into investments where the
main goal is preservation of capital. The Company is exploring alternatives to
increase its interest income while maintaining the highest degree of safety in
its investments.

Provision for Income Taxes

The
Company is required to present the provision for taxes as if it were fully
taxable in accordance with Financial Accounting Standards Board (FASB)
Accounting Standards Codification 852-740. In prior years, the Company utilized
its pre-emergence bankruptcy NOLs in the calculation of its income taxes
payable although it is still required to pay U.S. and State alternative minimum
taxes (AMT) in certain jurisdictions, even though it has substantial federal
and state NOL carry forwards. Due to its loss before taxes in fiscal year 2009
and 2010, the Company did not use any net benefits related to these NOLs. See
note 8 to the consolidated financial statements, Income Taxes, in this Form
10-Q for additional discussion of the accounting for income taxes.

Liquidity and Capital Resources

The
Company has financed its liquidity needs over the last several years through
revenue generated by the operations of its wholly owned subsidiary Medical
Graphics Corporation.

The
Company had cash and cash equivalents of $10.5 million and working capital of
$14.7 million as of January 31, 2010. During the first quarter, the Company
used $644,000 in cash from operating activities,
primarily due to a net loss of $826,000 that included non-cash expenses of
$195,000 for depreciation and amortization and $222,000 of stock-based
compensation.

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Cash
was negatively impacted by a decrease in employee compensation payables of
$304,000 and a decrease in the deferred income balance of $211,000. The
decrease in employee compensation is typical for the first quarter of the
fiscal year as employee bonuses are paid out during this period. Changes in
inventory levels had a $238,000 positive impact on cash during the first
quarter as the Company adjusted to the decrease in sales volume.

During
the first quarter, the Company used $88,000 in cash for the purchase of
property, equipment and intangible assets, which mainly consisted of computers
and other information technology equipment.

The
Company generated cash from financing activities of $17,000 during the quarter
from the exercise of options and the issuance of shares under the Employee
Stock Purchase Plan.

The
Company believes that its liquidity and capital resource needs for fiscal year
2010 and the next 12 months will be met through its current cash and cash
equivalents as well as cash flows resulting from operations. In
addition, as previously announced, the Company has developed a market-focused
approach to leverage the strength of its MedGraphics brand and worldwide
selling and distribution capability. Specifically, the Company has held
discussions with various potential product and technology partners. If the
Company is successful in concluding these negotiations, it may use some of its
cash and capital resources in the acquisition of new technologies or
businesses. Although the Company is continuing to look at a number of these
opportunities, it currently has no agreements or understandings with any of
these third parties.

Forward Looking
Statements

The
discussions in this Form 10-Q in Managements Discussion and Analysis of
Financial Condition and Results of Operations contain forward-looking
statements about Angeions future financial results and business prospects that
by their nature involve substantial risks and uncertainties. You can identify
these statements by the use of words such as anticipate, believe,
estimate, expect, project, intend, plan, will, target, and other
words and terms of similar meaning in connection with any discussion of future
operating or financial performance or business plans or prospects. Our actual
results may differ materially depending on a variety of factors including: (1)
national and worldwide economic and capital market conditions; (2) continuing
cost-containment efforts in our hospital, clinics, and office market; (3) any
changes in the patterns of medical reimbursement that may result from national
healthcare reform; (4) our ability to successfully operate our business,
including successfully converting our increasing research and development
expenditures into new and improved cardiorespiratory diagnostic products and
services and selling these products and services under the MedGraphics and New
Leaf brand names into existing and new markets; (5) our ability to maintain our
cost structure at a level that is appropriate to our near to mid-term revenue
expectations and that will enable us to increase revenues and profitability as
opportunities develop; (6) our ability to achieve constant margins for our
products and consistent and predictable operating expenses in light of variable
revenues from our clinical research customers; (7) our ability to expand our
international revenue through our distribution partners and our Milan, Italy
representative branch office; (8) our ability to successfully defend ourselves
from product liability claims related to our cardiorespiratory diagnostic
products and claims associated with our prior cardiac stimulation products; (9)
our ability to defend our existing intellectual property and obtain protection
for intellectual property we develop in the future; (10) our ability to develop
and maintain an effective system of internal controls and procedures and
disclosure controls and procedures and (11) our dependence on third-party
vendors.

16

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Table of Contents

Additional
information with respect to the risks and uncertainties faced by the Company
may be found in, and the above discussion is qualified in its entirety by, the
other risk factors that are described from time to time in the Companys
Securities and Exchange Commission reports, including the Annual Report on Form
10-K for the year ended October 31, 2009 and subsequently filed reports.

Item 3. Quantitative and Qualitative Disclosures About
Market Risk

None.

Item 4T. Controls and Procedures.

(a) Evaluation of Disclosure Controls and
Procedures

Management,
with the participation of the Companys chief executive officer, Rodney A.
Young, and chief financial officer, William J. Kullback, has evaluated the
effectiveness of the design and operation of the disclosure controls and
procedures, as defined in Rules 13a-15(e) under the Securities Exchange Act of
1934, as of the end of the period covered by this report. Management has
concluded that the Companys disclosure controls and procedures are effective
to ensure that information required to be disclosed in the reports that the
Company files under the Exchange Act is recorded, processed, summarized and
reported within the time periods specified in the rules and forms of the SEC
and that the disclosure controls are also effective to ensure that information
required to be disclosed in the Companys Exchange Act reports is accumulated
and communicated to management, including the chief executive officer and
principal accounting officer, to allow timely decisions regarding required
disclosure.

(b) Changes in Internal Controls

There
have been no significant changes in internal control over financial reporting
that occurred during the first fiscal quarter of 2010 that have materially
affected, or are reasonably likely to materially affect, the registrants
internal control over financial reporting.

17

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Table of Contents

PART II  OTHER INFORMATION

Item 1. Legal Proceedings.

The
Company is subject to claims and lawsuits that have been filed in the ordinary
course of business. From time to time, the Company brings suit against others
to enforce patent rights or to collect debts in the ordinary course of
business. There are no known current lawsuits or other litigation that involve
the Company. Therefore, management believes that the settlement of all
litigation would not have a material effect on the results of operations or
liquidity of the Company.

Item 1A. Risk Factors

The
most significant risk factors applicable to the Company are described in Part
I, Item 1A Risk Factors of our Annual Report on Form 10-K for the year ended
October 31, 2009. We believe there have been no material changes from the risk
factors disclosed in that Annual Report on Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use
of Proceeds.

None.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Other Information.

Entry into a Material Definitive Arrangement

On
March 9, the Board of Directors approved the Angeion Corporation 2010
Management Incentive Bonus Plan (the 2010 Bonus Plan).

The
2010 Bonus Plan provides for the payment of cash compensation to eligible
employees, including the Companys executive officers, upon achievement of
predetermined objectives. Payouts under the 2010 Bonus Plan will be based on
achievement of two separate measurements:

| |      |                                                                                                                                                                             
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (i)  | Pre-tax income before
 equity-based compensation (that is net pre-tax income prior to any stock based compensation
 expense incurred for equity grants) (50% weighting); and
| |      |                                                                                                                                                                             
| | (ii) | Total Angeion revenue (50%
 weighting).                                                                                                                                     

There
is a threshold, a target and a maximum for each of the two measurements under
the 2010 Bonus Plan. In order to receive an amount greater than the target
under either metric, the Company must achieve at least the threshold level in
the other metric. The Board of Directors believes this was important to
encourage the Companys employees to focus on both revenue growth as well as
pretax income.

18

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Table of Contents

Consistent
with the terms of their previously disclosed employment agreements and the 2010
Bonus Plan, if target financial performance is achieved in each metric, the
Companys President and Chief Executive Officer Rodney A. Young would receive a
bonus of 42.5% of his base salary, or $133,705, the Companys Chief Financial
Officer William J. Kullback would receive a bonus of 25% of his base salary, or
$50,000, and the Companys Executive Vice President Terrance J. Kapsen would
receive a bonus of 25% of his base salary, or $50,000.

Election of Directors

On
March 9, 2010, the Angeion Board of Directors elected Scott A. Shuda as a
Director of the Company. In 2003, Mr. Shuda co-founded and became a Managing
Director of BlueLine Partners, a special situations investment firm that
focuses on publicly listed technology and healthcare companies. Prior to founding
BlueLine Partners, Mr. Shuda was employed as an attorney in New York City and
Silicon Valley. Mr. Shuda also served as General Counsel to Vicinity
Corporation, an internet company that went public in 2000 and was acquired by
Microsoft in 2002. He has a law degree and a master of business administration
degree from Georgetown University. Mr. Shuda will be serving on Angeions
Compensation Committee, Strategy Committee and Governance/Nominating Committee.

Item 5.Exhibits.

|     |                                                                                                                
|---- | ---------------------------------------------------------------------------------------------------------------
|31.  | Certifications
 pursuant to Rules 13a-14 and 15d-14 of the Exchange Act.                                       
|     |                                                                                                                
|32.  | Certifications
 pursuant to 18 U.S.C. § 1350.                                                                  
|     |                                                                                                                
|99.1 | Press
 release dated March 9, 2010 announcing the election of Scott A. Shuda to the
 Angeion Board of Directors

19

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Table of Contents

SIGNATURES

Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.

|                |                                        |                          | 
|--------------- | -------------------------------------- | ------------------------ | 
|                | ANGEION
 CORPORATION                  
|                | (Registrant)                          
|                |                                       
|March 15,
 2010 |                                       
|                | By                                     | /s/ Rodney
 A. Young     | 
|                | Rodney A.
 Young                      
|                | President
 and Chief Executive Officer
|                |                                       
|March 15,
 2010 |                                       
|                | By                                     | /s/ William
 J. Kullback | 
|                | William J.
 Kullback                  
|                | Chief
 Financial Officer              

20

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