UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington,
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, 2009.                                         
|                                                                            |                                                                                          
|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          No
o

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
          No x

As of March 1,
2009, the Company had outstanding 4,120,411 shares of Common Stock, $0.10 par
value.





---



TABLE OF
CONTENTS

|                                |                                                                                        |  | 
|------------------------------- | -------------------------------------------------------------------------------------- |  | 
|PART I  FINANCIAL
 INFORMATION |                                                                                        | 
|                                |                                                                                        |  | 
|Item 1.                         | Financial Statements (unaudited)                                                       |  | 
|Item 2.                         | Managements Discussion and Analysis of Financial Condition and
 Results of Operations |  | 
|Item 3.                         | Quantitative and Qualitative Disclosures about Market Risk                             |  | 
|Item 4T.                        | Controls and Procedures                                                                |  | 
|                                |                                                                                        |  | 
|PART II - OTHER INFORMATION     |                                                                                        | 
|                                |                                                                                        |  | 
|Item 1.                         | Legal Proceedings                                                                      |  | 
|Item 1A.                        | Risk Factors                                                                           |  | 
|Item 2.                         | Unregistered Sales of Equity Securities and Use of Proceeds                            |  | 
|Item 3.                         | Defaults Upon Senior Securities                                                        |  | 
|Item 4.                         | Submission of Matters to a Vote of Security Holders                                    |  | 
|Item 5.                         | Other Information                                                                      |  | 
|Item 6.                         | Exhibits                                                                               |  | 
|                                |                                                                                        |  | 
|SIGNATURES                      |                                                                                        | 

2

---



PART I - FINANCIAL
INFORMATION

Item 1. Financial Statements.

ANGEION CORPORATION AND SUBSIDIARIES
Consolidated Balance Sheets 
January 31, 2009 and October 31, 2008(in thousands except
share and per share data)

|                                                                                                                                                                                   |  |                    |        |                    |   |        |  
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------ | ------ | ------------------ | - | ------ | -
|                                                                                                                                                                                   |  | January 31, 
 2009 |        | October 31, 
 2008 |  
|                                                                                                                                                                                   |  | (unaudited)        |        |                    |  
|Assets                                                                                                                                                                             |  |                    |        |                    |   |        |  
|Current
 assets:                                                                                                                                                                   |  |                    |        |                    |   |        |  
|Cash and cash equivalents                                                                                                                                                          |  | $                  | 8,673  |                    | $ | 9,047  |  
|Accounts receivable, net of allowance for doubtful
accounts of $181
 and $283, respectively                                                                                        |  |                    | 5,500  |                    |   | 5,446  |  
|Inventories, net of obsolescence reserve of $704 and
$597,
 respectively                                                                                                           |  |                    | 5,095  |                    |   | 5,143  |  
|Prepaid expenses and other current assets                                                                                                                                          |  |                    | 213    |                    |   | 292    |  
|Total current assets                                                                                                                                                               |  |                    | 19,481 |                    |   | 19,928 |  
|                                                                                                                                                                                   |  |                    |        |                    |   |        |  
|Property and equipment, net of accumulated depreciation of $3,009 and
 $2,897, respectively                                                                                        |  |                    | 849    |                    |   | 937    |  
|Intangible assets, net                                                                                                                                                             |  |                    | 1,919  |                    |   | 2,100  |  
|Total
 Assets                                                                                                                                                                      |  | $                  | 22,249 |                    | $ | 22,965 |  
|                                                                                                                                                                                   |  |                    |        |                    |   |        |  
|Liabilities and Shareholders
 Equity                                                                                                                                              |  |                    |        |                    |   |        |  
|Current
 liabilities:                                                                                                                                                              |  |                    |        |                    |   |        |  
|Accounts payable                                                                                                                                                                   |  | $                  | 1,527  |                    | $ | 1,544  |  
|Employee compensation                                                                                                                                                              |  |                    | 1,123  |                    |   | 1,288  |  
|Deferred income                                                                                                                                                                    |  |                    | 1,425  |                    |   | 1,531  |  
|Warranty reserve                                                                                                                                                                   |  |                    | 155    |                    |   | 157    |  
|Other current liabilities and accrued
expenses                                                                                                                                     |  |                    | 351    |                    |   | 380    |  
|Total current liabilities                                                                                                                                                          |  |                    | 4,581  |                    |   | 4,900  |  
|                                                                                                                                                                                   |  |                    |        |                    |   |        |  
|Long-term
 liabilities:                                                                                                                                                            |  |                    |        |                    |   |        |  
|Long-term deferred income                                                                                                                                                          |  |                    | 758    |                    |   | 789    |  
|Total
 Liabilities                                                                                                                                                                 |  |                    | 5,339  |                    |   | 5,689  |  
|                                                                                                                                                                                   |  |                    |        |                    |   |        |  
|Shareholders
 equity:                                                                                                                                                             |  |                    |        |                    |   |        |  
|Common stock, $0.10 par value, authorized 25,000,000
shares,
 4,195,078 and 4,166,457 shares issued and 4,120,411 and 4,091,790 shares
 outstanding in 2009 and 2008, respectively |  |                    | 412    |                    |   | 409    |  
|Additional paid-in capital                                                                                                                                                         |  |                    | 21,209 |                    |   | 20,956 |  
|Accumulated deficit                                                                                                                                                                |  |                    | (4,711 | )                  |   | (4,089 | )
|Total shareholders equity                                                                                                                                                         |  |                    | 16,910 |                    |   | 17,276 |  
|Commitments
 and contingencies
 (Note 9)                                                                                                                                           |  |                    |        |                    |   |        |  
|Total
 Liabilities and Shareholders Equity                                                                                                                                        |  | $                  | 22,249 |                    | $ | 22,965 |  

See accompanying notes to
consolidated financial statements.

3

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

|                                           |  |                                  |       |      |   |       |  
|------------------------------------------ |  | -------------------------------- | ----- | ---- | - | ----- | -
|                                           |  | Three Months Ended 
 January 31, |      
|                                           |  | 2009                             |       | 2008 |  
|Revenues                                   |  |                                  |       |      |   |       |  
|Equipment and supply sales                 |  | $                                | 5,570 |      | $ | 6,632 |  
|Service revenue                            |  |                                  | 861   |      |   | 877   |  
|                                           |  |                                  | 6,431 |      |   | 7,509 |  
|Cost of revenues                           |  |                                  |       |      |   |       |  
|Cost of equipment and supplies             |  |                                  | 3,048 |      |   | 3,615 |  
|Cost of service revenue                    |  |                                  | 81    |      |   | 116   |  
|                                           |  |                                  | 3,129 |      |   | 3,731 |  
|                                           |  |                                  |       |      |   |       |  
|Gross margin                               |  |                                  | 3,302 |      |   | 3,778 |  
|                                           |  |                                  |       |      |   |       |  
|Operating expenses:                        |  |                                  |       |      |   |       |  
|Selling and marketing                      |  |                                  | 1,798 |      |   | 2,371 |  
|General and administrative                 |  |                                  | 1,154 |      |   | 1,318 |  
|Research and development                   |  |                                  | 787   |      |   | 618   |  
|Amortization of intangibles                |  |                                  | 182   |      |   | 182   |  
|                                           |  |                                  | 3,921 |      |   | 4,489 |  
|                                           |  |                                  |       |      |   |       |  
|Operating loss                             |  |                                  | (619  | )    |   | (711  | )
|Interest income                            |  |                                  | 4     |      |   | 63    |  
|                                           |  |                                  |       |      |   |       |  
|Loss before taxes                          |  |                                  | (615  | )    |   | (648  | )
|Provision for taxes                        |  |                                  | 7     |      |   | 27    |  
|                                           |  |                                  |       |      |   |       |  
|Net loss                                   |  | $                                | (622  | )    | $ | (675  | )
|                                           |  |                                  |       |      |   |       |  
|Loss per share - basic                     |  |                                  |       |      |   |       |  
|Net loss per share                         |  | $                                | (0.15 | )    | $ | (0.17 | )
|                                           |  |                                  |       |      |   |       |  
|Loss per share - diluted                   |  |                                  |       |      |   |       |  
|Net loss per share                         |  | $                                | (0.15 | )    | $ | (0.17 | )
|                                           |  |                                  |       |      |   |       |  
|Weighted average common shares outstanding |  |                                  |       |      |   |       |  
|Basic                                      |  |                                  | 4,101 |      |   | 4,089 |  
|Diluted                                    |  |                                  | 4,101 |      |   | 4,089 |  

See
accompanying notes to consolidated financial statements.

4

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

|                                                                             |  |                                 |       |      |   |       |  
|---------------------------------------------------------------------------- |  | ------------------------------- | ----- | ---- | - | ----- | -
|                                                                             |  | Three months ended
 January 31, |      
|                                                                             |  | 2009                            |       | 2008 |  
|Cash Flows From Operating Activities:                                        |  |                                 |       |      |   |       |  
|Net loss                                                                     |  | $                               | (622  | )    | $ | (675  | )
|Adjustments to reconcile net loss to net
 cash used in operating activities: |  |                                 |       |      |   |       |  
|Depreciation and amortization                                                |  |                                 | 293   |      |   | 306   |  
|Stock-based compensation                                                     |  |                                 | 182   |      |   | 111   |  
|Increase in inventory obsolescence
reserve                                   |  |                                 | 107   |      |   |      |  
|Decrease in allowance for doubtful
accounts                                  |  |                                 | (102  | )    |   | (8    | )
|Changes in operating assets and
 liabilities:                                |  |                                 |       |      |   |       |  
|Accounts receivable                                                          |  |                                 | 48    |      |   | 1,706 |  
|Inventories                                                                  |  |                                 | (59   | )    |   | (435  | )
|Prepaid expenses and other current assets                                    |  |                                 | 79    |      |   | 86    |  
|Accounts payable                                                             |  |                                 | (17   | )    |   | (565  | )
|Employee compensation                                                        |  |                                 | (165  | )    |   | (691  | )
|Deferred income                                                              |  |                                 | (137  | )    |   | (132  | )
|Warranty reserve                                                             |  |                                 | (2    | )    |   | (47   | )
|Other current liabilities and accrued
expenses                               |  |                                 | (29   | )    |   | 4     |  
|Net cash used in operating activities                                        |  |                                 | (424  | )    |   | (340  | )
|                                                                             |  |                                 |       |      |   |       |  
|Cash Flows From Investing Activities:                                        |  |                                 |       |      |   |       |  
|Purchase of property and equipment and
 intangible assets                    |  |                                 | (24   | )    |   | (108  | )
|Net cash used in investing activities                                        |  |                                 | (24   | )    |   | (108  | )
|                                                                             |  |                                 |       |      |   |       |  
|Cash Flows From Financing Activities:                                        |  |                                 |       |      |   |       |  
|Proceeds from issuance of common stock
 under employee stock purchase plan   |  |                                 | 11    |      |   | 11    |  
|Proceeds from the exercise of stock
options                                  |  |                                 | 63    |      |   |      |  
|Net cash provided by financing activities                                    |  |                                 | 74    |      |   | 11    |  
|                                                                             |  |                                 |       |      |   |       |  
|Net decrease in cash and cash equivalents                                    |  |                                 | (374  | )    |   | (437  | )
|                                                                             |  |                                 |       |      |   |       |  
|Cash and cash equivalents at beginning of period                             |  |                                 | 9,047 |      |   | 6,908 |  
|                                                                             |  |                                 |       |      |   |       |  
|Cash and cash equivalents at end of period                                   |  | $                               | 8,673 |      | $ | 6,471 |  
|                                                                             |  |                                 |       |      |   |       |  
|See
 accompanying notes to consolidated financial statements.                | 

5

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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, 2009, the consolidated statements
of operations and cash flows for the three months ended January 31, 2009 and
2008, 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, 2008 was derived from
the audited consolidated financial statements as of that date. Operating
results for the three months ended January 31, 2009 are not necessarily
indicative of the results that may be expected for the year ending October 31,
2009. 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, 2008.

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, 2009 and 2008,
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.

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

In
accordance with the SECs Staff Accounting Bulletin No. 104, 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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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. In accordance with paragraph 4 of the Emerging Issues Task Force
abstract 00-21, Revenue Arrangements with
Multiple Deliverables, the Company applies Financial Accounting
Standards Board (FASB) Technical Bulletin No. 90-1 to service contract
revenue. Deferred income associated with service contracts and supplies was
$1,989,000 and $2,005,000 at January 31, 2009 and October 31, 2008,
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 $189,000 and $223,000 at January
31, 2009 and October 31, 2008, 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, 2009 and 2008.

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.
Advance payments from customers aggregated $5,000 and $92,000 as of January 31,
2009 and October 31, 2008, respectively, are included in deferred income on the
consolidated balance sheet. 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

Effective
November 1, 2006, the Company adopted the provisions of FASB Statement No. 123
(revised 2004), Share-Based Payment
(SFAS No. 123R). Under the fair value recognition provisions of SFAS No.
123R, the Company measures stock-based compensation cost at the grant date
based on the fair value of the award and recognizes the compensation expense
over the requisite service period, which is generally the vesting period. The
Company elected the modified-prospective method of adopting SFAS No. 123R,
under which prior periods are not retroactively restated. The provisions of
SFAS No. 123R apply to awards granted, modified or cancelled after the November
1, 2006 effective date. There were no non-vested awards outstanding on the
effective date for SFAS No. 123R. Total share-based compensation expense
included in the Companys statement of operations for the three months ended
January 31, 2009 and 2008 was $182,000 and $111,000, respectively.

7

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Stock Options

Under
the Angeion Corporation 2002 Stock Option Plan (the 2002 Plan), the Company
had reserved 800,000 shares of its common stock for issuance upon exercise of
stock options. As of January 31, 2009, options for 800,000 shares had been
granted, 451,850 shares had been issued upon exercise of options, 950 shares
were forfeited and options to purchase 347,200 shares remained outstanding. In
connection with our adoption of the 2007 Stock Incentive Plan described below,
the 2002 Plan was amended to provide that no new options could be granted under
the 2002 Plan.

At
a Special Meeting of Shareholders held on August 22, 2007, the shareholders
approved the Angeion Corporation 2007 Stock Incentive Plan (the 2007 Plan)
and reserved 250,000 shares of its common stock for issuance upon exercise of
stock options under the 2007 Plan. At the 2008 Annual Meeting of Shareholders
held on May 20, 2008, the shareholders approved an amendment to the 2007 Plan
that increased the authorized shares of common stock for issuance upon exercise
of stock options by 300,000 to a total of 550,000 shares. As of January 31,
2009, options for 358,753 shares were outstanding, 74,667 shares were issued
for restricted stock awards and 116,580 shares were available for future grant.

The
2007 Plan and 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.

|                                    |  |                       |         |                                    |   |        |  |                                     |         |   |   |      | 
|----------------------------------- |  | --------------------- | ------- | ---------------------------------- | - | ------ |  | ----------------------------------- | ------- | - | - | ---- | 
|                                    |  | For the quarter ended |        
|                                    |  | January 31, 2009      |         | January 31, 2008                   |  
|                                    |  | Shares                |         | Weighted
 Average
 Exercise
 Price |   | Shares |  | Weighted
 Average
 Exercise 
 Price |        
|Outstanding
 at beginning of period |  |                       | 730,953 |                                    | $ | 5.96   |  |                                     | 611,120 |   | $ | 6.12 | 
|Granted                             |  |                       |        |                                    |   |       |  |                                     | 2,000   |   |   | 7.81 | 
|Exercised                           |  |                       | (25,000 | )                                  |   | 2.53   |  |                                     |        |   |   |     | 
|Expired or cancelled                |  |                       |        |                                    |   |       |  |                                     | (12,000 | ) |   | 7.86 | 
|Outstanding
 at end of period       |  |                       | 705,953 |                                    | $ | 6.08   |  |                                     | 601,120 |   | $ | 6.09 | 

8

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The
following table summarizes information concerning stock options outstanding as
of January 31, 2009:

|                 |       |                     |  |                                                  |         |                                    |  |                              |  |   |      |  |  |         | 
|---------------- | ----- | ------------------- |  | ------------------------------------------------ | ------- | ---------------------------------- |  | ---------------------------- |  | - | ---- |  |  | ------- | 
|Exercise
 Prices |       | Number
 Outstanding |  | Weighted
 Average
 Remaining
 Contractual 
 Life |         | Weighted
 Average
 Exercise
 Price |  | Number
 Subject to
 Exercise | 
|$                | 2.00  |                     |  |                                                  | 11,650  |                                    |  | 4.68                         |  | $ | 2.00 |  |  | 11,650  | 
|                 | 2.53  |                     |  |                                                  | 72,000  |                                    |  | 6.62                         |  |   | 2.53 |  |  | 72,000  | 
|                 | 5.08  |                     |  |                                                  | 84,000  |                                    |  | 7.32                         |  |   | 5.08 |  |  | 84,000  | 
|                 | 5.16  |                     |  |                                                  | 49,000  |                                    |  | 6.57                         |  |   | 5.16 |  |  |        | 
|                 | 5.66  |                     |  |                                                  | 90,000  |                                    |  | 6.30                         |  |   | 5.66 |  |  |        | 
|                 | 6.23  |                     |  |                                                  | 84,500  |                                    |  | 4.22                         |  |   | 6.23 |  |  | 84,500  | 
|                 | 6.60  |                     |  |                                                  | 71,583  |                                    |  | 5.56                         |  |   | 6.60 |  |  | 26,095  | 
|                 | 7.08  |                     |  |                                                  | 10,000  |                                    |  | 6.17                         |  |   | 7.08 |  |  |        | 
|                 | 7.79  |                     |  |                                                  | 86,800  |                                    |  | 4.68                         |  |   | 7.79 |  |  | 86,800  | 
|                 | 7.81  |                     |  |                                                  | 2,000   |                                    |  | 5.76                         |  |   | 7.81 |  |  | 667     | 
|                 | 7.86  |                     |  |                                                  | 144,420 |                                    |  | 5.75                         |  |   | 7.86 |  |  | 48,149  | 
|                 |       |                     |  |                                                  |         |                                    |  |                              |  |   |      |  |  |         | 
|                 | Total |                     |  |                                                  | 705,953 |                                    |  | 5.68                         |  | $ | 6.08 |  |  | 413,861 | 

The
total intrinsic value of options exercised during the three months ended
January 31, 2009 was $15,000. The total intrinsic value of options outstanding
and exercisable at January 31, 2009 was $53,000, which was calculated using the
closing stock price of $3.09 as of January 30, 2009 (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, 2009 was $63,000 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, 2009 was $1,081,000 and is expected to be recognized over a
weighted average period of 1.98 years and will be adjusted for any future
changes in estimated forfeitures.

Restricted Stock Awards

On
August 28, 2008, the Board of Directors authorized the issuance of 74,667
restricted shares 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 such stock was established by the market price on the date of
grant which was $5.16 per share. 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 period ended
January 31, 2009.

Unrecognized
compensation expense related to outstanding restricted stock awards as of January
31, 2009 was $330,000 and is expected to be recognized over a weighted average
period of 2.61 years. The Company did not grant any restricted stock awards
prior to fiscal year 2008.

9

---



The
following table presents the statement of operations classification of pre-tax
share-based compensation expense recognized for the three months ended January
31, 2009:

|                                  |  |                                |     |      |   |     | 
|--------------------------------- |  | ------------------------------ | --- | ---- | - | --- | 
|                                  |  | Three months ended January 31, |    
|(In
 thousands)                   |  | 2009                           |     | 2008 |  
|Cost of
 goods sold               |  | $                              | 13  |      | $ | 6   | 
|Selling and
 marketing            |  |                                | 43  |      |   | 31  | 
|General and
 administrative       |  |                                | 114 |      |   | 68  | 
|Research and
 development         |  |                                | 12  |      |   | 6   | 
|Share-based
 compensation expense |  | $                              | 182 |      | $ | 111 | 

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, 2009.

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, 2008,
employees purchased 3,621 shares at a price of $2.99 per share. As of January
31, 2009, the Company has withheld approximately $1,900 from employees
participating in the phase that began on January 1, 2009. At January 31, 2009,
approximately 63,477 shares of common stock were available for future purchase
under the Stock Plan.

|   |                                                                                  
|-- | ---------------------------------------------------------------------------------
|4. | Inventories                                                                      
|   |                                                                                  
|   | Inventories
 consisted of the following at January 31, 2009 and October 31, 2008:

|                |  |      |       |      |   |       | 
|--------------- |  | ---- | ----- | ---- | - | ----- | 
|(In
 thousands) |  | 2009 |       | 2008 |  
|Raw
 materials  |  | $    | 2,066 |      | $ | 2,035 | 
|Work-in-Process |  |      | 211   |      |   | 156   | 
|Finished
 goods |  |      | 2,818 |      |   | 2,952 | 
|                |  | $    | 5,095 |      | $ | 5,143 | 

10

---



|   |                                                                                        
|-- | ---------------------------------------------------------------------------------------
|5. | Intangible Assets                                                                      
|   |                                                                                        
|   | Intangible
 assets consisted of the following at January 31, 2009 and October 31, 2008:

|                                     |  |      |        |      |   |        |  
|------------------------------------ |  | ---- | ------ | ---- | - | ------ | -
|(In
 thousands)                      |  | 2009 |        | 2008 |  
|Intangible
 assets:                  |  |      |        |      |   |        |  
|Developed technology                 |  | $    | 6,722  |      | $ | 6,722  |  
|Trademarks
 (unamortized)            |  |      | 53     |      |   | 53     |  
|                                     |  | $    | 6,775  |      | $ | 6,775  |  
|                                     |  |      |        |      |   |        |  
|Amortization
  developed technology |  |      | (4,856 | )    |   | (4,675 | )
|                                     |  | $    | 1,919  |      | $ | 2,100  |  

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 $182,000 for the quarters ended January 31, 2009 and
2008. If the Company continues to utilize pre-emergence bankruptcy net
operating loss carry forwards, the Company will further reduce the carrying
cost of its developed technology until the net carrying cost of these assets is
zero. To the extent that utilization of these NOLs reduces the cost of
developed technology, future amortization expense will be reduced. Estimated
amortization expense for each of the succeeding fiscal years based on the
intangible assets as of January 31, 2009, which does not reflect the possible
reduction discussed above, is as follows:

|                                     |  |              |       | 
|------------------------------------ |  | ------------ | ----- | 
|(In
 thousands)                      |  | Amortization |      
|Nine months
 ending October 31, 2009 |  | $            | 545   | 
|2010                                 |  |              | 421   | 
|2011                                 |  |              | 420   | 
|2012                                 |  |              | 421   | 
|                                     |  | $            | 1,807 | 

The
Company did not realize any pre-bankruptcy benefits for the quarters ended
January 31, 2009 and 2008. The above table does not include
estimated amortization expense for patents of $59,000, 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, 2009 and 2008 were as
follows:

|                              |  |      |     |      |   |      |  
|----------------------------- |  | ---- | --- | ---- | - | ---- | -
|(In
 thousands)               |  | 2009 |     | 2008 |  
|Balance,
 beginning of period |  | $    | 157 |      | $ | 253  |  
|Warranty provisions           |  |      | 53  |      |   | 68   |  
|Warranty claims               |  |      | (55 | )    |   | (115 | )
|Balance, end
 of period       |  | $    | 155 |      | $ | 206  |  

11

---



|   |                    
|-- | -------------------
|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.

The
Company had options outstanding at January 31, 2009 and 2008 to purchase
705,953 and 601,120 shares, respectively, of its common stock. As a result of
the net loss in first quarter 2009 and 2008, the outstanding stock options 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 $7,000
and $27,000 for the three months ended January 31, 2009 and 2008, 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 amount of income taxes payable, if any,
is determined after utilizing the Companys NOLs, including its pre-emergence
bankruptcy NOLs. Under American
Institute of Certified Public Accountants Statement of Position 90-7, Financial Reporting by Entities in Reorganization
Under the Bankruptcy Code (SOP 90-7), the tax benefit for
the utilization of these pre-emergence bankruptcy
NOL carry forwards must be recognized as a reduction of intangibles
rather than a reduction of the provision for taxes in the statement of
operations.

The
Company adopted the provisions of FIN 48 on November 1, 2007. There was no
additional reserve for uncertain tax positions recognized as a result of
adoption of FIN 48. During the quarter ended January 31, 2008, the Company
recognized $27,000 of income tax expense related to the increase in reserves
for uncertain tax positions. At October 31, 2008, the reserve was $35,200 and
was not changed during the quarter ended January 31, 2009. 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 $10,000 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.

12

---



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, 2004. 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.

The
Company had a federal net operating loss carry forward at October 31, 2008 of
approximately $20.3 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 during the fourth quarter of
fiscal year 2006. This carry forward is available to offset a portion of taxes
payable in future years. If not used, this carry forward will expire in the
years 2009 through 2025. Approximately $7.0 million of this carry forward will
expire, if unused, during the next five years ending October 31, 2013. The
Company also has $113,000 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, 2009, and the
Company will continue to assess the need for a full valuation allowance in
future quarters. Under SOP 90-7, a substantial portion of any future reversal
of the valuation allowance will first reduce any intangible assets and then be
credited directly to additional paid-in capital. After the exhaustion of pre-emergence bankruptcy NOLs, approximately $2.3 million of the valuation
allowance is related to post-bankruptcy NOLs and would be available to reduce
the provision for taxes in the statement of operations and, thereafter,
$778,000 related to excess stock option tax deductions would be recognized as
additional paid-in capital when realized in the Companys income tax return.

|   |           
|-- | ----------
|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. 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.

|    |                
|--- | ---------------
|10. | Severance Costs

On January
31, 2008, the Company implemented a Reduction-In-Force (RIF) that terminated
the employment of eight employees to allow better management of operating
expenses. On the same date, Dale H. Johnson, the Companys Chief Financial
Officer, retired. As a result of these actions, the Company accrued a total of
$194,000 in severance costs for the quarter ended January 31, 2008. The Company
did not accrue any severance costs in the first quarter of 2009.

The
following table reconciles the first quarter activity for accrued severance
expenses:

|                              |  |      |    |      |   |     | 
|----------------------------- |  | ---- | -- | ---- | - | --- | 
|(In
 thousands)               |  | 2009 |    | 2008 |  
|Balance,
 beginning of period |  | $    | 6  |      | $ | 0   | 
|Severance payments            |  |      | (6 | )    |   |    | 
|Additional severance incurred |  |      |   |      |   | 194 | 
|Balance, end
 of period       |  | $    | 0  |      | $ | 194 | 

13

---



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 fiscal 2009, the Company launched an all-new, updated CCM
Express, which provides accurate resting energy expenditure measurements
(REE) for either ventilated or spontaneously breathing patients. The Company
expects the added features of the CCM Express to expand the scope of use for
this product and its REE function beyond critical care management into
cardiology, oncology and other markets.

Total
revenue for the first quarter of 2009 was $6.4 million, a decrease of 14.4%
from $7.5 million in 2008. Operating expense for the first quarter of 2009 was
$3.9 million, a decrease of 12.7% from $4.5 million in 2008. Net loss for the
quarter was $622,000, or $0.15 per share, compared to a net loss of $675,000,
or $0.17 per diluted share, for the same period in 2008.

For
a discussion of risks associated with our business, see the section entitled
Forward Looking Statements on page 17 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, |      
|                                    |  | 2009                             |       | 2008 | 
|                                   
|Revenues                            |  |                                  | 100.0 | %    |  | 100.0 | % 
|Cost of revenue                     |  |                                  | 48.7  |      |  | 49.7  |   
|Gross margin                        |  |                                  | 51.3  |      |  | 50.3  |   
|                                    |  |                                  |       |      |  |       |   
|Selling and marketing
 expenses     |  |                                  | 28.0  |      |  | 31.6  |   
|General and administrative expenses |  |                                  | 17.9  |      |  | 17.6  |   
|Research and development expenses   |  |                                  | 12.2  |      |  | 8.2   |   
|Amortization of intangibles         |  |                                  | 2.8   |      |  | 2.4   |   
|Total operating expenses            |  |                                  | 60.9  |      |  | 59.8  |   
|Operating loss                      |  |                                  | (9.6  | )    |  | (9.5  | ) 
|Interest income                     |  |                                  | 0.0   |      |  | 0.9   |   
|Provision for taxes                 |  |                                  | 0.1   |      |  | 0.4   |   
|Net loss                            |  |                                  | (9.7  | )%   |  | (9.0  | )%

14

---



The
following paragraphs discuss the Companys performance for the three month
periods ended January 31, 2009 and 2008.

Revenue

Total
revenue for the three months ended January 31, 2009, decreased by 14.4%
compared to 2008. Domestic product revenue decreased 19.6%, international
product revenue decreased 5.3% and service revenue decreased 1.9%.
International revenue decreased as a result of the inclusion of revenue from
the Companys large clinical research customer in 2008. Excluding the clinical
research business, international revenue increased 3.8% in the first quarter
2009 compared to the same quarter in 2008. The domestic business decreased as a
result of the current economic environment which prompted a number of hospitals
and other health care providers to institute freezes on capital spending.
Service revenue declined only slightly because revenue from extended service
contracts and non-warranty service visits both increased in 2009 compared to
2008 as a result of a larger installed customer base from higher sales in 2006
and 2007.

Gross Margin

Gross
margin percentage for the three month period ended January 31, 2009 increased
to 51.3% of revenue compared to 50.3% for the same period in 2008. Gross margin
percentage increased slightly as a result of higher margin service revenue
constituting a larger percentage of total sales (13.4% in 2009 and 11.7% in
2008) as well as cost reduction initiatives implemented during fiscal 2008.

Selling and Marketing

Selling
and marketing expense for the three months ended January 31, 2009 decreased by
24.2%, or $573,000, to $1.8 million compared to $2.4 million for the same
period in 2008.

The
sales and sales support payroll, travel and customer support expense decreased
by $425,000, or 27.7%, for the three months ended January 31, 2009 compared to
the same period in 2008. During fiscal 2008, the Company terminated eight
employees in the sales and marketing function to allow better management of
operating expenses. The Company realized $220,000 in payroll and benefits
savings as a result of this action. In addition, due to an internal
reorganization, several employees were transferred to the research and
development area, further reducing payroll and benefits expense.

Commission
expense decreased by $81,000, or 28.2%, for the three months ended January 31,
2009 compared to the same period in 2008 which corresponded to the 14.4%
reduction in Company revenue.

General and
Administrative

General and
administrative expenses for the three months ended January 31, 2009 decreased
by 12.4%, or $164,000, to $1.2 million compared to $1.3 million for the same
period in 2008.

Professional
fees decreased by $62,000 for the three months ended January 31, 2009 compared
to the same period in 2008. The majority of the expense savings were related to
the change in our public auditing firm that occurred May 1, 2008.

On
January 31, 2008, Dale Johnson, Angeions then-Chief Financial Officer,
retired. As a result of this event, costs of $148,000 were accrued in the first
quarter of 2008 for severance and medical benefits. No similar event occurred
in the first quarter of 2009.

15

---



Additional
non-cash stock-based compensation expense of $46,000 was incurred during the
three months ended January 31, 2009 compared to January 31, 2008 related to
stock options and restricted stock awards granted on August 28, 2008.

Research and
Development

Research
and development expenses for the three months ended January 31, 2009 increased
by 27.4%, or $169,000, to $787,000 from $618,000 for the same period in 2008.

Payroll and
benefits costs increased $105,000 over the prior period as some current
employees were transferred into this area from selling and marketing. This
increase was partially offset by a $31,000 decrease in legal expenses related
to intellectual property as the Company had incurred higher expenses in the
2008 first quarter related to the ongoing preparation and filing of patent and
trademark applications.

Project
expenses associated with new products increased by $48,000, or 89%, for the
three months ended January 31, 2009 compared to the same period in 2008 as the
Company prepared for and implemented the release of the all new CCM Express.

The
Companys 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 $182,000 for the three months ended January 31,
2009 which did not change from the comparable period in 2008. There were no
additions of intangible assets in the first quarter of 2009.

Interest Income

Interest
income for the three months ended January 31, 2009 decreased to $4,000 from $63,000 for the same
period in 2008. The decrease in
interest income is principally due to significantly lower market interest rates
as 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 SOP 90-7. The Company has utilized its pre-emergence
bankruptcy NOLs in the past for the calculation of its income taxes payable but
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. During the quarters ended January 31, 2009 and 2008, the Company did
not use any tax benefits related to pre-emergence bankruptcy 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 and the use of
pre-emergence bankruptcy NOLs.

16

---



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 $8.7 million and working capital of
$14.9 million as of January 31, 2009. During the first quarter, the Company
used $424,000 in cash from operating activities, primarily due to a net loss of
$622,000 that included non-cash expenses of $293,000 for depreciation and
amortization and $182,000 of stock-based compensation.

Cash
was negatively impacted by a decrease in employee compensation payables of
$165,000 and a decrease in the deferred income balance of $137,000. 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 minimal impact on cash during the first quarter.

During
the first quarter, the Company used $24,000 in cash for the purchase of
property and equipment, which mainly consisted of computers and other
information technology equipment. The Company has no material commitments for
capital expenditures for the remainder of fiscal year 2009.

The
Company generated cash from financing activities of $74,000 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
2009 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
discussion in this Form 10-Q, including statements in this Management
Discussion and Analysis of Financial Condition and Results of Operations,
contains 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) our ability to successfully operate our
business including our ability to develop, improve, and update our
cardiorespiratory diagnostic products and successfully sell these products
under the MedGraphics and New Leaf Fitness brand names into existing and new
markets, (4) 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, (5) 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, (6) our ability to effectively manufacture and ship
products in required quantities to meet customer demands, (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 intellectual property, (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.

17

---



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, 2008 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 2009 that have
materially affected, or are reasonably likely to materially affect, the
registrants internal control over financial reporting.

18

---



PART II  OTHER INFORMATION

Item 1. Legal Proceedings.

The Company is subject to certain 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. 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, 2008. Except as set forth below, we believe there have been no
material changes from the risk factors disclosed in that Annual Report on Form
10-K.

The
Company is experiencing continuing slowness in its sales of its MedGraphics
cardiorespiratory products due to cost-containment measures in its hospital,
clinics and physician office market and is unable to predict when sales in this
market will recover.

The
Company sells its MedGraphics brand cardiorespiratory diagnostic systems and
services to hospitals, clinics and physician offices. During the first quarter
of 2009, the Company experienced lower than anticipated sales to these
customers, particularly to the domestic hospital market, due to continuing
slowdowns in orders, delayed capital projects, and cuts in capital and
operating budgets. Although the Company is continuing to market its new and
existing products to these customers, the Company is unable to predict when these
customers will resume traditional or predictable purchasing patterns.

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

None.

Item 3. Defaults Upon Senior
Securities.

None.

Item 4. Submission of
Matters to a Vote of Security Holders.

None.

Item 5. Other Information.

None.

Item 6. Exhibits.

|    |                                                                         
|--- | ------------------------------------------------------------------------
|31. | Certifications
 pursuant to Rules 13a-14 and 15d-14 of the Exchange Act.
|    |                                                                         
|32. | Certifications
 pursuant to 18 U.S.C. § 1350.                           

19

---



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 17,
2009 |                                       |                         | 
|               | By                                    | /s/
Rodney A. Young     | 
|               | Rodney A.
Young                      
|               | President
and Chief Executive Officer
|March 17,
2009 |                                       |                         | 
|               | By                                    | /s/
William J. Kullback | 
|               | William J.
Kullback                  
|               | Chief
Financial Officer              

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