EXHIBIT 10.4


                 IMPLANTABLE CARDIOVERTER DEFIBRILLATOR PRODUCT
                       MANUFACTURING AND SUPPLY AGREEMENT


                                     BETWEEN


                      ANGEION CORPORATION, AS MANUFACTURER

                                       AND

                   ANGELLAN MEDICAL SYSTEMS, LLC, AS PURCHASER

Note:  Portions of this exhibit marked with "X's" have been omitted pursuant to
       a request for confidentiality under Rule 24b-2 of the Securities Exchange
       Act of 1934, as amended. A copy of this exhibit in its entirety has been
       filed separately with the Securities and Exchange Commission.

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                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
<S>      <C>                                                                                            <C>
1.       Definitions...................................................................................  1

2.       Manufacture and Purchase......................................................................  7
         2.1.         Agreement to Manufacture.........................................................  7
         2.2.         Exclusivity......................................................................  8
         2.3.         Existing Distributors of Manufacturer............................................  9
         2.4.         Other Cardiac-Related Devices....................................................  9

3.       Intellectual Property Matters................................................................. 10
         3.1.         Use of Purchaser's Trademarks on Products........................................ 10
         3.2.         Use of Manufacturer's Name on Products........................................... 10
         3.3.         No Use of Manufacturer's Trademarks.............................................. 10
         3.4.         Copyrights....................................................................... 10
         3.5.         Technical Information............................................................ 10
         3.6.         Infringement of Intellectual Property Rights of Manufacturer..................... 11
         3.7.         License of Technical Information................................................. 11

4.       Commercialization............................................................................. 11
         4.1.         Diligence........................................................................ 11
         4.2.         Reports and Sales Records........................................................ 12
         4.3.         Promotional and Product Literature............................................... 12
         4.4.         Technical Assistance............................................................. 13
         4.5.         Labels and Markings.............................................................. 14
         4.6.         Marketing Allowance and Royalties................................................ 14

5.       Regulatory and Governmental Approvals......................................................... 14
         5.1.         Clinical Studies................................................................. 14
         5.2.         Government Approvals............................................................. 15

6.       Pricing and Payments.......................................................................... 16
         6.1.         Transfer Prices.................................................................. 16
         6.2.         Payment Terms.................................................................... 17
         6.3.         Financial and Related Books and Records.......................................... 17
         6.4.         Late Payments.................................................................... 18

7.       Purchase and Supply of Product................................................................ 18
         7.1.         Orders........................................................................... 18
         7.2.         Effect of Late Payments.......................................................... 19
         7.3.         Inspection of Shipments.......................................................... 19
         7.4.         Purchase Forecasts............................................................... 20
         7.5.         Return of Expired Products....................................................... 20

8.       Quality Assurance; Testing.................................................................... 21

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         8.1.         Quality Control.................................................................. 21
         8.2.         Testing.......................................................................... 21
         8.3.         Records and Traceability......................................................... 21

9.       Warranties and Indemnifications............................................................... 22
         9.1.         Manufacturer Product Warranties.................................................. 22
         9.2.         Recalls.......................................................................... 23
         9.3.         Indemnification for Third Party Claims........................................... 24
         9.4.         Manufacturer Infringement Indemnification........................................ 25
         9.5.         Limitation on Damages. .......................................................... 25
         9.6.         Certain Covenants................................................................ 26
         9.7.         Representations and Warranties of the Parties.................................... 26
         9.8.         Mitigation....................................................................... 27
         9.9.         Indemnification Procedure for Third Party Claims and Infringement Claims......... 27

10.      Term and Termination.......................................................................... 28
         10.1.        Term............................................................................. 28
         10.2.        Events of Early Termination...................................................... 28
         10.3.        Rights and Obligations on Expiration or Termination.............................. 29

11.      Confidentiality; Publicity; Non-Solicitation.................................................. 30
         11.1.        Confidential Information......................................................... 30
         11.2.        Publicity........................................................................ 31
         11.3.        Non-Solicitation................................................................. 31

12.      Dispute Resolution Provisions................................................................. 32
         12.1.        General Dispute Principles....................................................... 32
         12.2.        Arbitration of Other Disputes.................................................... 32

13.      Miscellaneous................................................................................. 35
         13.1.        Fees and Expenses................................................................ 35
         13.2.        Severability..................................................................... 35
         13.3.        Entire Agreement; Amendments..................................................... 36
         13.4.        Notices.......................................................................... 36
         13.5.        No Waiver........................................................................ 37
         13.6.        Headings......................................................................... 38
         13.7.        Survival of Provisions........................................................... 38
         13.8.        Successors and Assigns........................................................... 38
         13.9.        No Third Party Beneficiaries..................................................... 38
         13.10.       Governing Law.................................................................... 38
         13.11.       Insurance........................................................................ 39
         13.12.       Waivers.......................................................................... 39
         13.13.       English Language Controls........................................................ 39
         13.14.       Relationship of the Parties...................................................... 39
         13.15.       Counterparts..................................................................... 40
         13.16.       Sovereign Immunity; Exclusions................................................... 40

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         13.17.       Force Majeure.................................................................... 40

</TABLE>


Schedule 1.13   -     Existing Distributors
Schedule 1.42   -     Related Agreements
Schedule 4.6    -     Marketing Allowance
Schedule 6.1(a) -     Unit Transfer Prices for Initial Products
Schedule 8.2    -     Testing Procedures
Schedule 9.7    -     No Conflicts
Schedule 12.2   -     AAA Rules
Schedule 13.11  -     Insurance

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                 IMPLANTABLE CARDIOVERTER DEFIBRILLATOR PRODUCT

                       MANUFACTURING AND SUPPLY AGREEMENT

         This Implantable Cardioverter Defibrillator Product Manufacturing and
Supply Agreement (the "Agreement") is entered into as of the 9th day of
December, 1997 ("Effective Date") by and between Angeion Corporation, a
Minnesota corporation ("Manufacturer"), and Angellan Medical Systems, LLC, a
Delaware limited liability company ("Purchaser").

         Manufacturer has the expertise in the manufacture of certain
Implantable Cardioverter Defibrillator ("ICD") products which shall be the
subject of this Agreement.

         Purchaser wishes to have made certain Products (as hereinafter defined)
and Manufacturer wishes to manufacture and sell to Purchaser such Products for
resale in the Territory (as hereinafter defined) subject to the terms and
conditions of this Agreement.

         NOW THEREFORE, in consideration of the mutual covenants and agreements
provided herein, the Parties agree as follows:

         1.       DEFINITIONS.

                  1.1. "AAA" shall mean the American Arbitration Association.

                  1.2. "Act" shall mean the United States Food, Drug and
Cosmetic Act of 1938, as amended from time to time (and any amendments or
additions thereto from time to time or any successor or similar Applicable Law).

                  1.3. "Adverse Device Events" shall mean any Product-related
event that is reportable (or that Purchaser or Manufacturer determines after
Best Efforts at mutual consultation should be reported) to (i) the FDA, or any
local ethics committee ("LEC") responsible for approving the protocols for any
clinical trials) conducted upon the Products in the Territory or any other
ethics committee within the Territory with responsibilities analogous to a LEC;
or (ii) to any other Governmental Authority responsible for the regulation of
medical devices.

                  1.4. "Affiliate(s)" shall mean any corporation, association or
other entity which directly or indirectly controls, is controlled by or is under
common control with the Party in question, but only for so long as such
relationship exists. As used herein, the term "control" shall mean the ability
to direct the business of a company and shall be presumed in the case of
ownership, directly or indirectly, of shares of stock having at least fifty
percent (50%) of the voting power entitled to vote for the election of directors
in the case of a corporation, and at least fifty percent (50%) of the voting
power and interest in profits in the case of a business entity other than a
corporation, or only if less than fifty percent (50%) of the voting power and
interest in profits is permitted by Applicable Law, the maximum amount allowed
in the country in question (so long as the holder retains the ability to direct
the business of the entity). The Parties acknowledge and agree that neither the
Purchaser nor any member of Purchaser or such member's Affiliates shall be
deemed to be included within the term "Affiliate" for any purposes under this
Agreement unless 

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otherwise expressly provided in this Agreement.

                  1.5. "Applicable Laws" shall mean all foreign, federal, state
and local laws, statutes, rules and regulations which have been enacted by a
Governmental Authority and are in force as of the date hereof or which are
enacted by a Governmental Authority and come into force during the term of this
Agreement, in each case to the extent that the same are applicable to the
performance by the Parties of their respective obligations under this Agreement.
Without limiting the foregoing, Applicable Laws shall include the Act (including
any applicable regulations under the Act governing manufacturing practices).

                  1.6. "Best Efforts" shall be determined under New York law and
shall mean such efforts as are consistent with efforts made by businesses of
similar size and resources in a similar circumstance and context to achieve a
particular result in a timely manner, but shall not require a Party to take
actions that would be commercially unreasonable to such Party in the
circumstances.

                  1.7. "Budgeted Sales Price" shall have the meaning set forth
in Section 6.1(b) of this Agreement.

                  1.8. "Cardiac Stimulation Device" shall mean an implantable
medical device for electrically stimulating or shocking the heart which is
suitable for use by or with human patients. The term "Cardiac Stimulation
Device" includes, without limitation: cardiac pacemakers, antitachycardia
pacemakers, cardioverters and defibrillators, including combinations thereof
("such devices"), pulse generators and other waveform generators for such
devices; electronic and mechanical components, including without limitation
batteries and capacitors to the extent these components are used for or with
such devices; mechanisms for coupling such devices in a stimulating, shocking or
sensing relationship to the heart including without limitation leads,
electrodes, and sensors; and data dispensing, processing and gathering systems
for such devices, including without limitation programmers, pacing system
analyzers, defibrillation system analyzers, testers, encoders, decoders,
transmitters, receivers, and computer software-controlled systems, including all
related software; and internal, but not external, holter monitors used for
recording heart rhythms (even though such internal holter monitors do not
electrically stimulate the heart). The term "Cardiac Stimulation Device"
excludes, by way of example and not limitation, muscle stimulators, nerve
stimulators, bone growth stimulators, cardiomyoplasty stimulators and associated
devices, arrhythmia mapping devices, imaging technology, angioplasty devices,
catheter ablation systems, and temporary external pacemakers and defibrillators
and EKG monitors (other than pacing programmers) which are stand-alone,
non-ambulatory and not intended for transtelephonic monitoring.

<PAGE>


                  1.9. "Confidential Information" shall mean technical and
business information relating to a Party's or its Affiliates' Intellectual
Property Rights, trade secret processes or devices, techniques, data, formula,
inventions (whether or not patentable) or products, research and development
(including research subjects, methods and results), production, manufacturing
and engineering processes, computer software, costs, profit or margin
information, pricing policies, confidential market information, finances,
customers, distribution, sales, marketing, and production and future business
plans and any other information of a "confidential" nature, specifically
including, without limitation, any information that is identified orally or in
writing by the disclosing party to be confidential, or that the receiving party
should reasonably understand under the circumstances to be a trade secret of the
disclosing party or information of a similar nature that is not generally known
to the public.

                  1.10. "Demand for Arbitration" shall have the meaning set
forth in Section 12.2(b).

                  1.11. "ELA" shall mean ELA Medical, Inc., a Delaware
corporation.

                  1.12. "ELA Supply Agreement" shall mean that certain Cardiac
Stimulation Device Product Manufacturing and Supply Agreement between Purchaser
and ELA dated the date hereof.

                  1.13. "Existing Distributors" shall mean those third parties
having an existing distribution, sales representative or agency arrangement with
Manufacturer in the Territory, the list of which third parties is set forth in
Schedule 1.13.

                  1.14. "Expense Reimbursement Basis" shall mean a reimbursement
for all reasonable out-of-pocket costs and expenses plus an agreed upon hourly
or per diem amount for personnel and agreed upon amounts for reasonable overhead
allocation.

                  1.15. "FDA" shall mean the United States Food and Drug
Administration or any successor United States governmental agency performing
similar functions with respect to medical devices.

                  1.16. "FDA Tracking Information" shall mean the information
relating to the Products that must be maintained pursuant to 21 U.S. Code of
Federal Regulations Part 821 and any amendments or additions thereto.

                  1.17. "Firm Period" shall mean any three months (or six
months, as applicable) of a Forecast which are considered "firm" pursuant to
Section 7.4.

                  1.18. "Force Majeure" shall mean, in relation to either Party,
any circumstances beyond the reasonable control of that Party, including,
without limitation, any fire, storm, flood, earthquake, explosion, accident,
acts of the public enemy, war, rebellion, insurrection, sabotage, epidemic,
quarantine restrictions, acts of God or acts of any Governmental Authority,
labor disputes that result in work stoppages, transportation embargoes or
failure or delays of transportation, or inability to secure raw materials or
machinery for the manufacture of devices as a result of any of

<PAGE>


the foregoing. No acts of a Governmental Authority resulting from any acts or
omissions of Purchaser or Manufacturer that are in breach of this Agreement
shall constitute an event of Force Majeure for the breaching Party.

                  1.19. "Forecast" shall have the meaning set forth in Section
7.4.

                  1.20. "Government Approval" shall mean governmental marketing,
and other governmental authorization required from any Governmental Authority
before the Products may be commercially marketed in the Territory, including any
requirements for reimbursement and pricing approval.

                  1.21. "Governmental Authority" shall mean any nation or
government, any state, province or other political subdivision thereof or any
entity exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government, including the FDA.

                  1.22. "ICD" shall have the meaning set forth in the recitals
hereto.

                  1.23. "Infringement Claims" shall have the meaning set forth
in Section 9.4.

                  1.24. "Initiating Person" shall have the meaning set forth in
Section 12.2(b).

                  1.25. "Intellectual Property Rights" shall mean any patent,
copyright, registered design, trademark or other industrial or intellectual
property right owned or otherwise enforceable pursuant to license or otherwise
by any Person, and applications for any of the foregoing.

                  1.26. "Inventory" shall mean the Purchaser's inventory of
Products.

                  1.27. "IDE" shall mean an investigational device exemption
from the FDA for sale of Products in the United States prior to obtaining FDA
approval for commercial sale.

                  1.28. "Labels and Markings" shall mean labeling materials,
packaging, trade dress, logos, tradenames, trademarks and related materials used
for exterior packaging and exterior labeling of Products to be sold by Purchaser
(or any distributor or subdistributor thereof) under this Agreement, but shall
not include Promotional Materials or Technical Materials.

                  1.29. "LLC Agreement" shall mean the limited liability company
operating agreement between Manufacturer and ELA relating to the operations and
governance of Purchaser dated the date hereof.

<PAGE>


                  1.30. "Material Adverse Effect" means any material adverse
effect on the assets, results of operations, properties, business or financial
condition of the Manufacturer or Purchaser, as applicable, and its subsidiaries
taken as a whole.

                  1.31. "Order" shall mean a firm purchase order for the
Products made by Purchaser.

                  1.32. "Other Cardiac-Related Devices" shall mean any
cardiac-related devices other than Cardiac Stimulation Devices.

                  1.33. "Party" shall mean each of Manufacturer and Purchaser
and "Parties" shall mean both of Manufacturer and Purchaser, in each case
together with each of their successors and permitted assigns.

                  1.34. "Person" shall mean any individual, general partnership,
limited partnership, limited liability company corporation, joint venture,
trust, business trust, cooperative or association, or any foreign trust or
foreign business organization or any Governmental Authority.

                  1.35. "Price Period" shall mean a six-month period beginning
on January 1 and July 1 of each year until December 31, 1999 and a one-year
period from January 1 to December 31 of each year of the term of this Agreement
thereafter; provided, that the first Price Period under this Agreement shall be
from the date of this Agreement through June 30, 1998.

                  1.36. "Product" and "Products" shall mean the entire current
and future ICD product line, including, without limitation, mechanisms for
coupling such devices in a stimulating, shocking or sensing relationship to the
heart including, without limitation, leads, electrodes and sensors; and data
dispensing, processing and gathering systems for such devices including, without
limitation, programmers, defibrillation system analyzers, testers, encoders,
decoders, transmitters, receivers and computer software-controlled systems,
including all related software, that are developed or acquired, directly or
indirectly (including by Manufacturer being acquired by or becoming an Affiliate
of a party not previously an Affiliate) by Manufacturer and its Affiliates, and
all subsequent modifications, components and improvements used therein during
the term of this Agreement; provided, however, that any Products acquired by
Manufacturer, directly or indirectly, that are subject to agreements or
restrictions that prevent Manufacturer from complying with the terms hereof
shall be excluded from this Agreement only to the extent of such pre-existing
agreements and only for the remainder of the then existing term thereof.

                  1.37. "Promotional Materials" shall mean all promotional and
marketing materials used by Purchaser in connection with the marketing and
commercialization of the Products in the Territory, including but not limited to
sales aids, catalogues, sales brochures, sales manuals, advertisements (in
printed or electronic form), convention exhibits, protocols for clinical studies
after FDA approval of a Product and publications from such studies.

<PAGE>


                  1.38. "Purchaser's Marks" shall mean the trademarks and logos
owned or licensed by Purchaser or its Affiliates (including ELA and its
Affiliates) (whether registered or not) as Purchaser may from time to time
designate to be used in marketing and selling the Products in the Territory
during the term of this Agreement.

                  1.39. "Quarter" shall mean each calendar quarter ending March
31, June 30, September 30, or December 31 of each year during the term of this
Agreement.

                  1.40. "Recalls" shall mean any withdrawals of the Product from
the market in the Territory declared by Manufacturer or Purchaser, whether
voluntary or involuntary.

                  1.41. "Regulatory Data" shall mean the medical, clinical and
other scientific data necessary to, required for, or included in any regulatory
filing to obtain or maintain any Government Approval to market the Products
including pre-approval and post-approval reports, filings and submissions, other
than reports of Adverse Device Events and related summaries.

                  1.42. "Related Agreements" shall mean the agreements listed on
Schedule 1.42.

                  1.43. "Respondent" shall have the meaning set forth in Section
12.2(b).

                  1.44. "Technical Information" shall mean know-how, trade
secrets, inventions, data, technology, processes and information, including
improvements and modifications to any thereof, relating to the Products,
disclosed by Manufacturer to Purchaser under this Agreement that are either
Confidential Information of Manufacturer or its Affiliates or are protected by
Intellectual Property Rights of Manufacturer or its Affiliates, including
without limitation, processes and analytical methodology used in development,
testing, analysis and manufacture and medical, clinical and other scientific
data other than those which (i) are already known to Purchaser at the time of
disclosure or are received from a third party with a right to convey it, or (ii)
were independently developed by Purchaser prior to the time of disclosure;
provided, that Purchaser shall bear the burden of proving either of the
exceptions in (i) or (ii) hereto.

                  1.45. "Technical Materials" shall mean all manuals,
programming guides, user guides and training manuals of an educational or
instructional nature which are distributed in conjunction with each Product,
including any information made available by Manufacturer to Purchaser to be used
as part of the content of the Promotional Materials.

                  1.46. "Territory" shall mean the United States of America and
any additional countries which may be added to the Territory by written
amendment of this Agreement executed by both Parties.

                  1.47. "Third Party Claims" shall have the meaning set forth in
Section 9.3(b).

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                  1.48. "Unit" shall mean a specific model of Product that is
packaged, invoiced and sold as a unit by Manufacturer, such as an ICD Unit, a
lead Unit, a programming Unit and an accessory Unit.

                  1.49. "Unit Transfer Price" shall mean the transfer prices set
in accordance with Section 6.1.

         Any reference in this Agreement to "writing" or cognate expressions
includes a reference to electronic or facsimile transmission or comparable means
of communications.

         Any reference in this Agreement to any Applicable Law shall be
construed as a reference to the relevant Applicable Law (including any successor
provisions) as amended, re-enacted or extended at the time in question.

         2.       MANUFACTURE AND PURCHASE.

                  2.1. AGREEMENT TO MANUFACTURE.

                           (a) Subject to the terms and conditions of this
Agreement, Manufacturer shall manufacture and supply Products to be labeled
under Purchaser's Marks to Purchaser for sale in the Territory on an exclusive
basis as specified in Section 2.2 and Purchaser shall purchase Products to be
labeled under Purchaser's Marks from Manufacturer for sale in the Territory.

                           (b) During the term of this Agreement, Purchaser
shall not have any rights to obtain the Products of Manufacturer from any
Person other than Manufacturer or its Affiliates.

                           (c) Purchaser shall not sell, or cause to sell, (i)
Products to any Person located outside the Territory or (ii) Products to any
Person located in the Territory, if, to the knowledge of Purchaser, such Party
inside the Territory intends to resell the Products in any country outside the
Territory; provided, however, that subject to subclause (ii) above, Purchaser
will not be liable for any third party acts resulting in Products being sold
outside the Territory. Nothing herein shall be deemed to obligate Purchaser to
impose any restrictions upon the use or resale of any Product by a purchaser
thereof in the Territory to the extent that such a restriction would be in
violation of Applicable Law. Purchaser shall not be in breach of this Agreement
as a result of any use or resale of a Product outside the Territory by a
purchaser that is not bound by restrictions on such use or resale by virtue of
the provisions of the preceding sentence. To the maximum extent permissible
under Applicable Law, Purchaser shall cease all sales of Products to Persons it
has reason to believe are reselling Products outside the Territory whether or
not such resales are permissible under Applicable Law.

                           (d) Except as provided in Section 3.7, nothing herein
shall be construed to: (i) effect any sale or transfer of any Technical
Information or Intellectual Property Rights of Manufacturer to Purchaser; (ii)
grant any license to Purchaser to design, develop or manufacture the Products;
or (iii) grant to Purchaser any rights to the Intellectual Property Rights of
Manufacturer or its Affiliates.

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                           (e) Subject to the terms of this subsection,
Manufacturer shall determine its offering of Products from time to time in its
sole discretion, including setting its development schedule for any new Product
or the improvement or modification of a Product. Notwithstanding the foregoing
and subject to Section 9.4, Manufacturer shall (i) give Purchaser written notice
at least one (1) year in advance of any discontinuance of the sale of an ICD
Product in the Territory, or (ii) offer for sale to Purchaser an improved
Product for the same uses or indications unless otherwise agreed in writing by
the Parties. Manufacturer's discontinuance of the sale of a Product to Purchaser
hereunder shall not thereafter give Manufacturer the right to sell such
discontinued Product in the Territory, whether directly or through third
parties.

                  2.2. EXCLUSIVITY.

                           (a) Subject to the provisions of Sections 2.1(e) and
2.2(f) for the term of this Agreement, Manufacturer shall sell, or cause to be
sold, Products exclusively to Purchaser for marketing and sale in the Territory.
In furtherance hereof and subject to the terms of this Agreement, Purchaser
shall have the exclusive right to import, have imported, advertise, have
advertised, market, have marketed, promote, have promoted, sell, have sold and
have distributed the Products in the Territory.

                           (b) Manufacturer agrees not to take, or permit to be
taken, any action which is inconsistent with the exclusive rights granted to
Purchaser under Section 2.2(a). Without limiting the foregoing, but subject to
Section 2.2(f), Manufacturer shall not, directly or indirectly, (i) sell,
deliver or supply, or cause to be sold, delivered or supplied, Products to any
Person in the Territory, under any label or trademark, (ii) make, manufacture or
supply, or cause to be made, manufactured or supplied, Products for the account
of any Person in the Territory, under any label or trademark, (iii) grant any
manufacturing or marketing rights with respect to the Products in the Territory,
under any labels or trademarks, or (iv) sell, deliver or supply, or cause to be
sold, delivered or supplied, Products to any Person outside the Territory, if,
to the knowledge of Manufacturer, such Person intends to resell the Products in
the Territory, provided however, that subject to the foregoing, Manufacturer
will not be liable for any third party acts resulting in Products being sold in
the Territory other than by Purchaser and its Purchaser Distributors. Nothing
herein shall be deemed to obligate Manufacturer to impose any restrictions upon
the use or resale of any Product by a purchaser thereof outside the Territory
(other than a distributor of Manufacturer) to the extent that such a restriction
would be in violation of Applicable Law. Manufacturer shall not be in breach of
this Agreement as a result of any use or resale of a Product in the Territory by
a purchaser that is not bound by restrictions on such use or resale by virtue of
the provisions of the preceding sentence. To the maximum extent permissible
under Applicable Law, Manufacturer shall cease all sales of Products to Persons
it has reason to believe are reselling Products in the Territory, whether or not
such resales are permissible under Applicable Law.

<PAGE>


                           (c) If either Manufacturer or Purchaser learns of any
sales of Products in the Territory other than by Purchaser and its distributors,
such Party will provide written notice thereof to the other Party. The Parties
shall consult with each other in good faith concerning appropriate actions
(consistent with Applicable Laws) to stop and thereafter prevent such sales of
the Products in the Territory. If the Parties are unable to agree upon a joint
course of action, each Party shall be free to take such actions as it sees fit
in its discretion, subject to compliance with Applicable Law, provided that
neither Party shall be under any obligation to take any such action.

                           (d) Purchaser acknowledges that, subject to the
restrictions set forth herein, Manufacturer may sell Products, or otherwise
enter into agreements with third parties with respect to the manufacture, sale
and distribution of Products in countries outside the Territory.

                           (e) Manufacturer acknowledges that Purchaser has
entered into the ELA Supply Agreement pursuant to which it may purchase and sell
Cardiac Stimulation Devices which may be now or in the future competitive with
the Products.

                           (f) Purchaser acknowledges and agrees that
Manufacturer may import, have imported, distribute, have distributed, sell and
have sold Products within the Territory for the limited purpose of obtaining any
Government Approval in accordance with the terms hereof. Purchaser further
acknowledges and agrees that Manufacturer may export and have exported Products
manufactured in the Territory for distribution or sale outside the Territory.

                  2.3. EXISTING DISTRIBUTORS OF MANUFACTURER.

         Manufacturer has no Existing Distributors of the Products in the
Territory as of the date hereof except as set forth on Schedule 1.13.

                  2.4. OTHER CARDIAC-RELATED DEVICES.

         Prior to entering into any contract with any third party with regard to
the purchase, sale or distribution in the Territory of Other Cardiac-Related
Devices other than for research or clinical testing of such Other
Cardiac-Related Devices, each Party agrees to discuss in good faith with the
other the inclusion of Other Cardiac-Related Devices under this Agreement,
subject to mutually agreeable terms. Nothing in this Section 2.4 shall create an
obligation between the Parties to agree to include Other Cardiac-Related Devices
and any obligation to include Other Cardiac-Related Devices will arise only as
and to the extent that an agreement is reached between the Parties in writing.

<PAGE>


         3.       INTELLECTUAL PROPERTY MATTERS

                  3.1. USE OF PURCHASER'S TRADEMARKS ON PRODUCTS.

         Unless otherwise agreed by the Parties in writing, the Products
manufactured and supplied to Purchaser for sale in the Territory hereunder shall
bear only Purchaser's Marks in such manner as Purchaser may direct, consistent
with Applicable Laws and Government Approvals.

                  3.2. USE OF MANUFACTURER'S NAME ON PRODUCTS.

         Solely if and to the extent necessary to obtain or comply with a
Government Approval, or to comply with Applicable Law or where the Parties
otherwise mutually agree, including in response to advice or guidance from a
Governmental Authority, the Products, Promotional Materials, Labels and Markings
and Technical Materials covered by this Agreement shall bear the name and, if
also required, the address of Manufacturer solely as a designation of the
identity of the manufacturer of such Product, and Manufacturer hereby grants to
Purchaser the right to use Manufacturer's name solely for such purposes subject
to such reasonable procedures to protect the name and any related Intellectual
Property Rights of Manufacturer as the Parties may agree.

                  3.3. NO USE OF MANUFACTURER'S TRADEMARKS.

         Subject to the provisions of Section 3.2, nothing in this Agreement
shall give Purchaser any right to use any trademarks or tradenames of
Manufacturer or its Affiliates in connection with the Products being
manufactured for Purchaser hereunder.

                  3.4. COPYRIGHTS.

         With respect to all copyrights related to any tangible materials
produced for Purchaser by or under the direction of Manufacturer, including
Technical Materials, software and translated materials and Labels and Markings,
but excluding Promotional Materials, title in and to any copyrights for such
materials shall remain with the Manufacturer, and Purchaser shall have no right
to copy, reproduce or make derivative works thereof, unless otherwise
specifically agreed between the Parties in writing. All title in and to any
copyrights in the Promotional Materials shall rest with Purchaser, except that
nothing herein shall affect any right, title or interest of Manufacturer in the
Technical Materials (even if the Promotional Materials are derivative works
thereof) and subject to Section 11.5 of the LLC Agreement.

                  3.5. TECHNICAL INFORMATION.

         As between Manufacturer and its Affiliates, on the one hand, Purchaser,
and its Affiliates (including with respect to Purchaser, ELA), on the other
hand, all Technical Information and Regulatory Data, if any, generated by
Purchaser and its Affiliates pursuant to clinical studies or regulatory
approvals in the Territory shall be the property of Manufacturer. Purchaser, its
Affiliates and Purchaser Distributors shall have the right to use such Technical
Information and Regulatory Data solely in furtherance of the performance of
Purchaser's obligations under this Agreement. As the owner of the Technical
Information, Manufacturer shall have the right to use, disclose and 

<PAGE>


license to any Person all or any portion of such Technical Information.

                  3.6. INFRINGEMENT OF INTELLECTUAL PROPERTY RIGHTS OF
MANUFACTURER.

         In the event that Purchaser becomes aware of the possibility of an
infringement of the Intellectual Property Rights of Manufacturer by a third
party in the Territory, Purchaser shall promptly notify Manufacturer of the
circumstances surrounding such infringement. Manufacturer may, in its sole
discretion and at its own expense and retaining all proceeds therefrom, take
such actions as Manufacturer deems appropriate with respect to any infringement
identified by Purchaser, or with respect to any other infringement of
Intellectual Property Rights of Manufacturer or its Affiliates in the Territory,
as may be permitted by Applicable Law.

                  3.7. LICENSE OF TECHNICAL INFORMATION.

         Subject to the confidentiality provisions of this Agreement,
Manufacturer hereby grants a non-transferable, non-exclusive, royalty free
license to Purchaser of Technical Information for the sole purpose of allowing
Purchaser's personnel to provide technical support to customers and to develop
the Promotional Materials.

         4.       COMMERCIALIZATION.

                  4.1. DILIGENCE.

                           (a) As soon as practicable after receipt of 
Government Approval to market any Product in the Territory, Purchaser shall
thereafter use its Best Efforts to market, promote and commercialize such
Product in the Territory during the term of the Agreement.

                           (b) Purchaser shall promptly notify Manufacturer of
any inquiry (other than an order or potential order from a customer within the
Territory) from any Governmental Authority concerning the Products or
Manufacturer.

                           (c) Purchaser shall notify Manufacturer promptly upon
Purchaser's receipt of any actual notice that the FDA intends to visit or
inspect Purchaser's facilities in the Territory for a purpose relevant to the
development or marketing of the Products and provide Manufacturer with copies of
all correspondence relating thereto and an opportunity to participate in any
inspection or regulatory comments or correspondence prepared by Purchaser in
response to such comments.

                           (d) Purchaser and Manufacturer shall promptly notify
each other of any and all Adverse Device Events, or any events that could
reasonably be expected to become an Adverse Device Event, of which it becomes
aware and will forward promptly to the other all written reports relating to
such actual or potential Adverse Device Event. Purchaser shall also forward to
Manufacturer any explanted Products, if available. Subject to Section 9.2,
Manufacturer shall be responsible, and bear the cost of, all other requirements,
regulatory filings or measures resulting from such Adverse Device Event.

<PAGE>


                           (e) Purchaser shall not knowingly sell, lease, give
or otherwise dispose of any Product to any person or entity other than a duly
qualified medical practitioner or hospital and not knowingly sell, lease, give
or otherwise dispose of any Product for any use or application other than one
particularly authorized by Manufacturer in writing or in literature and labeling
accompanying the Product.

                           (f) Purchaser shall provide customer support services
in the Territory at levels consistent with Purchaser's Best Efforts obligation
to develop the market for the Products within the Territory, subject to industry
standards for customary levels of support services for similar products.

                  4.2. REPORTS AND SALES RECORDS

                           (a) At least once per year, Manufacturer and
Purchaser shall consult with each other for the purpose of assessing the state
of the market in the Territory.

                           (b) Purchaser shall provide to Manufacturer copies of
its up-to-date price lists each time such lists are revised.

                           (c) Purchaser will provide Manufacturer monthly, or
such other interval as may be agreed, with a report (format to be agreed upon)
on sales, marketing activities, market and competitive developments, human
resources and Inventory of Products. Purchaser shall also supply an annual
statement within forty-five (45) days after the end of each calendar year
detailing annual sales figures (stated both in Units and local currency) and a
semi-annual statement of aging Inventory and the amount of Inventory on hand at
June 30 and December 31 of each year within forty-five (45) days after each such
date.

                           (d) Purchaser and Manufacturer shall meet at regular
intervals throughout the year to exchange information concerning marketing
projects and clinical studies in the Territory.

                  4.3. PROMOTIONAL AND PRODUCT LITERATURE.

                           (a) Manufacturer will prepare and supply Purchaser
with reasonable quantities of all Technical Materials, including any revisions
or updates thereof, for each Product in English, at Manufacturer's sole cost and
expense. Manufacturer shall indemnify and hold Purchaser harmless from any and
all claims, expenses, damages and liabilities arising out of the Technical
Materials.

<PAGE>


                           (b) Purchaser will prepare and supply all Promotional
Materials for use in connection with sale of the Products in the Territory;
provided, however, (i) all Promotional Materials shall require the prior
approval of Manufacturer, which approval shall not be unreasonably withheld and
shall be communicated within a reasonable period of time, and Purchaser shall
make all changes therein as Manufacturer may, in a timely manner, reasonably
request; (ii) Purchaser shall not include any warranties in such materials that
exceed the warranties provided to Purchaser by Manufacturer in Section
9.1(a)(iii) and (iv) or on warranty cards provided by Manufacturer ; and (iii)
subject to Section 9.3, Purchaser shall indemnify and hold Manufacturer harmless
from any and all claims, expenses, damages and liabilities arising out of the
Promotional Materials. If Purchaser desires to design its own protocols for
clinical studies after FDA approval of Products, Purchaser shall submit such
protocols for the prior approval of Manufacturer. All publications resulting
from such studies must also be submitted to Manufacturer for approval prior to
publication.

                           (c) Unless otherwise agreed by the Parties in
writing, all Technical Materials, Promotional Materials and Labels and Markings
shall bear only Purchaser's Marks, except to the extent that Manufacturer's name
is required to be included in accordance with Section 3.2.

                           (d) Manufacturer shall supply to Purchaser a copy of
all sales, promotional or marketing literature that Manufacturer has developed
or used for sale of the Products for Purchaser's information and, if agreed by
the Parties in writing, Purchaser may use such sales, promotional or marketing
literature in developing the Promotional Materials.

                           (e) Manufacturer and Purchaser shall use their Best
Efforts to work together to coordinate the generation and review of the
Promotional Materials.

                  4.4. TECHNICAL ASSISTANCE.

         Manufacturer shall provide at no charge to Purchaser the services of
one qualified technician on a full-time basis during normal working hours for up
to four weeks each year during the term of this Agreement to provide training
and support at Manufacturer's Minnesota facility upon reasonable prior notice.
At Purchaser's option, Manufacturer shall provide such services at another
location, inside or outside the Territory; provided that Purchaser will
reimburse Manufacturer for its reasonable out-of-pocket expenses incurred in
connection with providing such services at another location (including airfare
and hotel). If Purchaser wishes to obtain additional technical support services
beyond those set forth above, Manufacturer shall provide such additional
services as Purchaser may reasonably request upon reasonable prior notice.
Purchaser shall compensate Manufacturer for any such additional services on an
Expense Reimbursement Basis.

<PAGE>


                  4.5. LABELS AND MARKINGS.

         Manufacturer shall prepare all Labels and Markings for the Products
manufactured for Purchaser hereunder, which Labels and Markings will include
Manufacturer's model numbers and Purchaser's Marks. Purchaser may submit the
format of such Labels and Markings to Manufacturer. Manufacturer shall submit
all Labels and Markings to Purchaser for its review and comment and shall make
such changes thereto as Purchaser may, in a timely manner, reasonably request,
subject only to any requirements under Applicable Law. Failure of Purchaser to
object or request changes to any Labels and Markings within 10 working days (in
France) of Purchaser's receipt of such materials shall be deemed approval at
such Labels and Markings. Purchaser shall supply electronic or camera-ready art
to Manufacturer for Purchaser's Marks to be used on the Labels and Markings and
Manufacturer shall be responsible for affixing such Labels and Markings to the
Product. No Labels and Markings may be altered without the prior written consent
of Purchaser except as required by Applicable Law or by order of a Governmental
Authority. Purchaser shall indemnify and hold Manufacturer harmless from and
against any and all claims, expenses, damages and liabilities arising out of the
use of Purchaser's Marks on any such Labels and Markings.

                  4.6. MARKETING ALLOWANCE AND ROYALTIES.

         From time to time, Manufacturer may (but shall have no obligation to)
pay to Purchaser a marketing allowance or charge a royalty for use of the
Intellectual Property Rights in any Products, each as if and to the extent
agreed by Manufacturer and Purchaser in writing. For 1998, Manufacturer shall
pay the Marketing Allowance set forth in Schedule 4.6.

         5.       REGULATORY AND GOVERNMENTAL APPROVALS.

                  5.1. CLINICAL STUDIES.

                           (a) Manufacturer shall use its Best Efforts to
initiate and complete clinical trials or studies in the Territory for the
purpose of obtaining all required Government Approvals, including without
limitation, from the FDA, for each Product after obtaining an IDE from the FDA
for such Product at its sole cost and expense. All such clinical trials shall be
conducted in accordance with Applicable Laws.

                           (b) Each of Manufacturer and Purchaser shall disclose
to the other all Regulatory Data in its possession or which it is responsible
for obtaining under this Agreement generated for the Products in the Territory
(or required by any Applicable Law to be made available in connection with the
sale of the Products in the Territory) and shall have the right to use, directly
or indirectly, all such information, including the right to cross-reference any
and all regulatory filings with respect to the Products, in connection with the
development and commercialization of the Products in accordance with this
Agreement. Each Party shall be solely responsible for its use of such Regulatory
Data. To assist in connection with commercialization of the Products in the
Territory pursuant to this Agreement, Manufacturer shall use its Best Efforts,
consistent with any legal or contractual limitations, to make available other
regulatory filings, clinical data and information regarding either the Products
or Manufacturer, including updating such information from time to time and upon
effecting any change by Manufacturer, for use by Purchaser solely for

<PAGE>


the purpose of obtaining Government Approvals required to be obtained by
Purchaser under Applicable Law and commercializing the Products in the
Territory.

                  5.2. GOVERNMENT APPROVALS.

                           (a) Manufacturer shall use its Best Efforts to obtain
an IDE, if required, and all other required or desirable Government Approvals,
including without limitation those required to be obtained from the FDA for the
clinical trials or studies and sale of each Product in the Territory at its sole
cost and expense after Manufacturer has completed the validation of such Product
required for human implant.

                           (b) Manufacturer will be responsible for all
requirements of Applicable Law in the Territory concerning the sale of the
Products in the Territory, including all Product labeling (other than trade
marks, tradenames, trade dress, logos, layout design and similar matters) and
local regulatory requirements within the Territory.

                           (c) Manufacturer will upon submission or receipt (i)
send to Purchaser a copy of any document submitted to or other correspondence
regarding the Product with any Governmental Authority; and (ii) provide
Purchaser with copies of all Government Approvals within fifteen (15) days of
receipt. Manufacturer will keep Purchaser informed, in writing, of the status of
its Government Approvals on a regular basis. Purchaser will assist Manufacturer
in connection with such activities, to the extent reasonably requested by
Manufacturer.

                           (d) After receipt of necessary Government Approvals
and thereafter throughout the term of this Agreement, Manufacturer will use its
Best Efforts to maintain such Government Approvals in effect at its own expense
to the extent it is commercially and economically viable.

                           (e) Unless otherwise required by Applicable Laws and
subject to the following sentence, Manufacturer shall be the holder of all
Government Approvals in the Territory. In the event that the Parties determine
that it is desirable, for legal or administrative reasons, for Purchaser or its
designee to hold any Government Approvals, Manufacturer will cooperate to permit
Purchaser to hold such Government Approvals.

                           (f) Manufacturer shall keep Purchaser advised of any
changes in Applicable Laws in the Territory, including material proposed changes
thereto, of which Manufacturer becomes aware in the course of performing its
duties hereunder that affect the Products.

<PAGE>


                           (g) Purchaser shall permit Manufacturer or its
designated representative to perform, upon reasonable prior notice and at
Manufacturer's sole cost and expense, reasonable vendor audits or other audits
required by Applicable Laws on the facilities, procedures and records which are
relevant to such audits of Purchaser and, to the extent obtainable by Purchaser
at no cost to Purchaser, on facilities, procedures and records which are
relevant to such audits of other distributors or any other Persons with
responsibility for any aspect of selling the Products, on reasonable advance
notice to Purchaser during normal business hours.

         6.       PRICING AND PAYMENTS.

                  6.1. TRANSFER PRICES.

                           (a) For each Unit shipped by Manufacturer to
Purchaser, Purchaser shall pay a Unit Transfer Price as fixed and agreed for
each Price Period between Manufacturer and Purchaser prior to commencement of
the relevant Price Period. Unit Transfer Prices for the initial Products for the
initial Price Period are set forth in Schedule 6.1(a) attached hereto. XXXX
XXXXXXXX XXXXXX XXX XXX XXXXXX XXX XX XXXXXXX XX XXXX XXXXX XXX XXXXX XXXXXXX
XXX XXXXXX XX X XXXXX XX XXXXX XXXXXX XXXXXXXX XXXXX XXXXXXXXX XXXXXX XXX XXX
XXXX XX XXXXXXX XX XXX XXXXXXXXX.

                           XXX XXXXXX XXX XXXXXXXXXXX XXXXX XX XXX XXXXX XX
XXXXXXX XXXXXXX XXXX XXXXXXX XXXXXX XXXXXXXXXXX XXXX XXXX XX XXXX XXXX XXXXXXX
XXX X XXXXX XXXXX XX XXXXX XXXXXXX XXXXX XXXX XXX XXXXX XXXXXX XXXX XXX XXXXXXX
XXXXXXX XXXXXXX XXX XXXXX XXXX XXXXX XXXX XXXXX XXX XXXX XXXX XX XXXXXXXX XXXX
XXXXXX XXX XX XXX XXX XXXXXXXX XXX XXXXXXX XXXX XXXXXX XXX XXXXXXX XXXXXXX XXX
XXXXXXXX XXX XXX XXXXX XXX XXXXXXXX XXXXX XXXXX XX XXX

                           (c) Manufacturer and Purchaser shall agree upon the
"Budgeted Sales Price" for each Unit as a reference for determining the Unit
Transfer Prices prior to expiration of the then current Price Period, such
agreement to be reached in accordance with the provisions of this Section 6.1.

                           (d) With respect to programming Units, Unit Transfer
Prices shall provide Manufacturer with a target price equal to XXXXXXXXXXXXXX
XXXXX XXXXXXXX XXXXXXXXXXXX XXXX XXX XXXX XXXXXXXXXXX XXXX XXXX XX XXXXX XXXXXX
XX XXXXX XXXXXX XXXX

                           (e) If the Parties are not able to reach agreement on
any Unit Transfer Price (including any marketing allowance or royalty under
Section 4.6) for any Price Period, they shall negotiate in good faith to attempt
to resolve their differences. If such negotiations shall fail to result in an
agreement within thirty (30) days, the Parties shall each submit their Unit
Transfer Price proposals to the Chief Executive Officers (or equivalent officer)
of the Parties to attempt to resolve their differences. If such Chief Executive
Officers shall fail to reach agreement within fifteen (15)

<PAGE>


days, the Parties shall submit their final proposals to an independent third
party decisionmaker who shall pick whichever of the final proposals more closely
adheres to the principles set forth in this Section 6.1 and Section 10.2 of the
LLC Agreement and the best available information presented by the Parties as to
fair and competitive prices in the Territory. The third party decisionmaker
shall be selected by joint agreement of the two Parties (or if they are unable
to agree within ten (10) days, then by the American Arbitration Association
("AAA"); provided, however, that the AAA shall not administer the proceedings).
The decision of such third party shall be final and non-appealable. The Person
selected to be the third party decisionmaker shall have experience in the
medical device industry and in distribution and other relevant commercial
matters in such industry. Preference shall be given to the selection of an
individual with experience as an arbitrator, but the individual need not be a
lawyer. The Parties shall each submit their final proposals to the independent
decisionmaker with supporting analyses and other information as they deem
appropriate within fifteen (15) days after selection of the decisionmaker. No
Party shall have EX PARTE communications with the decisionmaker during any time
period immediately relevant to the decisionmaker's actions in connection with
this Agreement. Each Party shall be entitled to rebut the presentation of the
other and to submit a final summary argument after review of the other Party's
rebuttal, in each case within fifteen (15) days after the final proposal
submissions. Each of the submissions of each Party (including their respective
final proposals) will be made concurrently to the independent decisionmaker and
will be opened simultaneously and provided to the other Party upon such opening.

                           (f) Pending resolution of any dispute regarding
applicable Unit Transfer Prices for any Price Period, the Parties shall continue
to purchase and sell Products based upon the prior Price Period's Unit Transfer
Prices (including any marketing allowance or royalty under Section 4.6).

                  6.2. PAYMENT TERMS.

         Manufacturer shall invoice Purchaser for the applicable Unit Transfer
Price promptly following shipment of Products by Manufacturer. All payments due
hereunder shall be paid in United States Dollars and are due XXX XXXXXX XXXX
XXXX days after the invoice date during the first two (2) Price Periods after
the Effective Date, XXX XXXXXX XXXX XXXX after the invoice date during the next
two (2) Price Periods after the Effective Date, and XXX XXXXXX XXXX XXXX after
the invoice date for all Price Periods thereafter. Payment, unless otherwise
agreed in writing, shall be made by wire transfer to such bank as Manufacturer
may designate in writing, without set-off and free and clear of and without any
deduction or withholding for or on account of, any taxes, duties, levies, fees
or charges of any nature whatsoever. Once an Order has been accepted by
Manufacturer, no shipment of Product so ordered may thereafter be delayed at
Purchaser's request.

                  6.3. FINANCIAL AND RELATED BOOKS AND RECORDS.

         Each Party shall maintain accurate and complete books and records with
respect to the performance of such Party's obligations under this Agreement,
such records to be maintained in accordance with generally accepted accounting
principles in the United States. Such records (wherever located) shall be
maintained for at least four years after the date of creation thereof. Each

<PAGE>


Party shall have the right during such four-year period, through its independent
auditors to conduct an audit, during normal business hours and following
reasonable prior notice to the other Party, to examine at the other Party's
location, all records of such other Party for the purpose of verifying the
payments or expenditures or performance of such Party hereunder. Information
provided to, and generated by, such auditors shall be considered Confidential
Information. If any such audit shows any underpayment or overcharge, the
auditing Party shall issue a written statement to the audited Party and a
correcting payment or refund shall be made within thirty (30) days after receipt
of the written statement described above unless the audited Party claims that
the statement is in error. The fees and expenses of the accountants performing
such verification shall be borne by the Party requesting the audit.
Notwithstanding the foregoing, if any such audit results in any underpayment or
overcharge with respect to any twelve-month period of more than $25,000, then
the Party being audited shall bear the reasonable costs of the accountants in
performing such audit. Upon request and in accordance with Applicable Law, each
Party shall provide to the other Party copies of such records reasonably
required by the requesting Party to comply with Applicable Laws at the sole cost
and expense of the requesting Party.

                  6.4. LATE PAYMENTS.

         All payments not made on a timely basis in accordance with this
Agreement shall bear interest at a rate of one percent per month (1%) or, if
lower, the maximum rate permitted by Applicable Law beginning on the date that
payment was due. Such interest is to be determined and compounded on a daily
basis from the date due until the date paid. Payment of such interest charges
will not excuse or cure any breach or default for late payment. If either Party
retains a collection agency, attorney or other Person to collect overdue
payments hereunder, all collection costs, including but not limited to
reasonable attorney's fees, will be payable by the non-paying Party.

         7.       PURCHASE AND SUPPLY OF PRODUCT.

                  7.1. ORDERS.

                           (a) Purchases and sales of Products shall be 
initiated by means of an Order on a purchase order form from Purchaser to
Manufacturer. Subject to subsection (b) below, Manufacturer shall accept all
such Orders promptly and in no event later than ten (10) working days from the
date of receipt by Manufacturer; provided that such Orders do not exceed nor
fall short of the Forecast for the relevant Firm Period determined in accordance
with Section 7.4 by more than 20%. All Orders accepted by Manufacturer shall not
thereafter be cancelable or recoverable by Purchaser or Manufacturer. It is
understood that each Party may, for convenience, use its own standard
pre-printed forms of invoice, purchase order, acknowledgement or acceptance in
the performance of its obligations hereunder; provided, however, that any terms,
conditions or provisions in such pre-printed forms which are inconsistent with
or which modify or supplement this Agreement shall be null and void. This
Agreement is not an Order of Purchaser and does not request or authorize
delivery of any Products, except pursuant to implementation of the specific
provisions of this Agreement.

<PAGE>


                           (b) In the event of any shortage of the Products,
Manufacturer shall allocate such Products among its customers and accept Orders
so as to give at least equal priority to Purchaser with all other customers
based upon the prior year's purchase volumes of Purchaser and such other
customers.

                           (c) Upon acceptance of each Order (but subject to 
Sections 7.2(a) and 10.3(f)), Manufacturer shall promptly inform Purchaser of
Manufacturer's estimated shipment date for the Order. Manufacturer's obligation
with respect to accepted Orders shall be to use its Best Efforts to meet the
delivery date specified in Purchaser's Order unless Purchaser expressly agrees
to a later date. If Manufacturer anticipates any delays in the scheduled
delivery date for any Order, Manufacturer will provide prompt written notice to
Purchaser and shall cooperate with Purchaser to reschedule delivery at the
earliest possible date so as to minimize the impact on Purchaser. If Purchaser
fails to make any purchases or if Manufacturer fails to use its Best Efforts to
meet the delivery date specified in any accepted Order (or any later date agreed
to by Purchaser as specified above), the defaulting Party shall be responsible
(subject to Section 9.5) for the other Party's reasonable damages resulting
therefrom but the non-defaulting Party shall be obligated to take reasonable
steps to mitigate such damages.

                           (d) All Products shall be shipped to locations
specified by Purchaser in the relevant Order in shipping packages specified or
supplied by Purchaser and using the Labels and Markings. All shipments shall be
FOB Manufacturer's plant.

                  7.2. EFFECT OF LATE PAYMENTS.

         If the Purchaser fails to pay the full amount due with respect to any
invoice (other than any amounts that are subject to a bona fide dispute) after
the date such invoice becomes due, Manufacturer shall be entitled (without
prejudice to any other right or remedy it may have) to:

                           (a) cancel or suspend any further deliveries of the
Products to the Purchaser under any Order; and

                           (b) charge the Purchaser interest on the unpaid 
invoice at the rate provided in Section 6.4 from the date the payment became due
until actual payment is made (irrespective of whether the date of payment is
before or after any judgment or award in respect of the same).

                  7.3. INSPECTION OF SHIPMENTS.

         Manufacturer shall send to Purchaser prior to or concurrently with each
shipment a copy of any documentation for the relevant Product that has been
agreed by the Parties. Purchaser shall have the right to inspect the shipment of
the Products which are the subject of each Order for damage, defects, shortages
or other noncomformities within thirty (30) calendar days after receipt thereof
and shall notify Manufacturer as soon as possible of any damage, defects,
shortages or of any other failure of the Products to conform to this Agreement.
Any Products which are the subject of an Order not rejected by Purchaser by
written notice to Manufacturer within such thirty (30) day period shall be
deemed accepted. Purchaser's sole remedy with respect to any nonconformity after
acceptance of a shipment shall be those provided pursuant to the warranties set
forth in Section 9.1.

<PAGE>


Upon Manufacturer's request, Purchaser shall provide Manufacturer with packing
slips, inspection reports and other documentation supporting its rejection of
any shipment. If such shortages or nonconformity existed at the time of delivery
of the Order, Manufacturer shall promptly deliver additional or substitute
Products to Purchaser in accordance with the delivery procedures set forth
herein.

                  7.4. PURCHASE FORECASTS.

         At least one calendar month prior to the first requested delivery of
Products hereunder, Purchaser shall notify Manufacturer in writing of the
projected total number of Products, broken down by each Product model or
category, to be purchased by Purchaser during each month of the succeeding
twelve (12) calendar month period ("Forecast"). The projections for the first
six (6) months of such initial Forecast shall be firm and shall be accompanied
by Orders for such first six (6) months with respect to the models covered
thereby. Thereafter, Purchaser shall provide Manufacturer with a similar
Forecast for any new Product models or categories; the first six (6) months of
such Forecast for new Products shall be firm and shall be accompanied by Orders
for such first six (6) months for such new Products. All such Forecasts shall be
updated on a monthly basis by adding a twelfth month to replace the expired
month (but not changing any other month in the Forecast), with updates to be
delivered not less than one (1) calendar month in advance. The first three (3)
months of each such updated Forecast (beginning with the fifth month of the
first Forecast period for each Product) shall be firm and shall be accompanied
by Orders for the Products in the additional month of the Firm Period. The
estimates for the remaining nine (9) months shall be non-binding estimates for
planning purposes only and Purchaser shall have no liability therefor. Purchaser
shall establish reasonable Inventory levels to meet demand for the Products
which shall be a minimum amount equal to one month of anticipated demand for the
Territory as evidenced by the Forecast. To accommodate Manufacturer's production
scheduling, the total Products ordered for any three (3)-month or six (6)-month
Firm Period will be limited to a twenty percent (20%) maximum aggregate increase
or twenty percent (20%) maximum decrease in Units relative to the projection for
such Firm Period contained in the Forecast provided to Manufacturer for such
Firm Period, unless otherwise agreed by the Parties in writing.

                  7.5. RETURN OF EXPIRED PRODUCTS.

         Purchaser shall, at its own expense, return to Manufacturer all
Products held in Inventory which have pased the "use before" date marked on the
sterile pack. Purchaser shall not be reimbursed or credited for any such expired
Inventory.

<PAGE>


         8.       QUALITY ASSURANCE; TESTING.

                  8.1. QUALITY CONTROL.

         Manufacturer shall produce the Products in accordance with all
Applicable Laws including requirements of the Act and the FDA's Good
Manufacturing Practice regulations in effect at the time of manufacture, and
applicable specifications for all models of the Products, including, without
limitation, those specified from time to time in the Technical Materials.
Manufacturer shall permit, shall cause its Affiliates and use its Best Efforts
to cause third party suppliers to permit, quality assurance representatives of
Purchaser promptly after signature of this Agreement, no more than once a year
thereafter, and prior to placing an initial Order for any new Product, to
inspect Manufacturer's or its Affiliates' manufacturing, testing and storage
facilities, and the manufacturing, testing and storage facilities of any third
parties who manufacture components for Manufacturer or its Affiliates, to
conduct quality assurance audits. Purchaser agrees that all arrangements for
such audits of third-party suppliers shall be made through Manufacturer and that
Manufacturer may, at its option, accompany Purchaser on any such audits. Such
audits shall be limited to inspection of the quality control systems and
procedures of the Person being audited and a review of Product validation files,
clinical documentation, and regulatory status, upon reasonable notice, during
normal business hours and pursuant to confidentiality agreements as described in
Section 11.1. Manufacturer shall permit, and cause its Affiliates and use its
Best Efforts to cause its third party suppliers to permit, any officials of any
Governmental Authority in the Territory to inspect its facilities as necessary
to comply with Applicable Laws. Manufacturer shall notify Purchaser of any FDA
inspection of its production or testing facilities for the Products and shall
provide Purchaser with copies of any reports (including Forms 483) issued as a
result thereof to the extent applicable to the Products.

                  8.2. TESTING.

         In accordance with Applicable Laws, including the requirements of the
Act, Manufacturer shall test or cause to be tested each Unit to be supplied
pursuant to this Agreement before delivery of such Unit to Purchaser.
Manufacturer acknowledges that Purchaser is relying upon testing documentation
or other validation or verification documents showing Manufacturer's compliance
with its standard quality control procedures relating to the Products provided
by Manufacturer with each shipment as to the compliance of such shipment with
all applicable specifications. Purchaser agrees to conduct only such testing or
programming of any Unit prior to delivery to a customer or after explant of any
Unit from a patient as may be agreed by Manufacturer in writing, otherwise
requested by Manufacturer in writing or in accordance with procedures set forth
on Schedule 8.2.

                  8.3. RECORDS AND TRACEABILITY.

         Manufacturer hereby covenants and agrees that for a minimum period of
fifteen (15) years after the sale and purchase of any Product hereunder, it
shall maintain complete and accurate records of the FDA Tracking Information for
all Products, and all components thereof, that are manufactured and sold under
this Agreement, to the extent necessary to meet or exceed all applicable FDA
requirements and other Applicable Laws. Purchaser hereby covenants and agrees

<PAGE>


that for a minimum period of fifteen (15) years after the sale and purchase of
any Product hereunder, it shall maintain the FDA Tracking Information regarding
the sale of all Products manufactured for it by Manufacturer hereunder to the
extent necessary to meet or exceed all applicable FDA requirements and other
Applicable Laws in the Territory and, in the event of a dissolution or
liquidation of Purchaser, Purchaser shall transfer such FDA Tracking Information
to Manufacturer. The Parties agree to provide each other with reasonable access
to and copies of such records and information in the event of any Recall or
other similar event involving the Products described in Section 9.2 or as
necessary for any compliance with Applicable Laws. In furtherance and not in
limitation of the foregoing, upon reasonable prior written notice from
Manufacturer, Purchaser shall provide to Manufacturer the FDA Tracking
Information at the end of each calendar month (or earlier if required by
relevant Applicable Law) if, and for so long as, the provision of such FDA
Tracking Information has become mandatory under Applicable Law.

         9.       WARRANTIES AND INDEMNIFICATIONS.

                  9.1. MANUFACTURER PRODUCT WARRANTIES.

                           (a) Manufacturer represents, warrants and covenants
that:

                                 (i) at the time of shipment of all Products
hereunder, such Products shall be new XXX XXXXXX XXXX XXXX remaining prior to
the expiration of the "use before" date and shall, unless otherwise agreed in
writing by the Parties, meet or exceed all requirements under all Applicable
Laws in the Territory;

                                 XXX XXXXXXXX XXXXXX XXXX XXXX XXX XXXXXX XXXXX
XX XXX XX XXXXXXXXXXXXX XXXX XXX XXXXX XXX XXX XXXXXX XXXXXXX XXXXXXXX XXXXXXX
XXXX XX XXXX XXXXXXXXXX

                                 XXX XXXXXXXX XXXXXX XXXX XXXX XXX XXXXXX XXXXX
XX XXX XX XXXXXXXXXXXXX XXXX XXX XXXXX XXXXXXXX XXXXXX XXXX XXXX XXX XXXXXX
XXXXX XX XXX XX XXXXXXXXXXXXX XXXX XXX XXXXX XXXXXXXX XXXXXX XXXX XXXX XXX
XXXXXX XXXXX XX XXX XX XXXXXXXXXXXXX XXXX XXX XXXXX

                                 XXX XXXXXXXX XXXXXX XXXX XXXX XXX XXXXXX XXXXX
XX XXX XX XXXXXXXXXXXXX XXXX XXX XXXXX XXXXXXXX XXXXXX XXXX XXXX XXX XXXXXX
XXXXX XX XXX XX XXXXXXXXXXXXX XXXX XXX XXXXX

                           The XXXXXXXXXXXXXXX referred to (iii) and (iv) above
apply only for the purposes of the warranty set forth in this Section 9.1.
Notwithstanding any provision of this Agreement, the Parties may agree to
shorten or lengthen the warranty periods set forth in Sections 9.1(a)(iii) or
(iv) from time to time to reflect competitive factors and if and to the extent
required by Applicable Law. Any such change shall be made in compliance with
Applicable Laws.

<PAGE>


                           (b) In the event of any breach of the foregoing
warranties, Manufacturer shall, at its option, reprocess, if feasible, or
supply a replacement of, any Products or any components thereof which fail to
meet the terms of such warranties at no additional charge to Purchaser and
Manufacturer shall be responsible for transportation and insurance costs to ship
such reprocessed or replacement Products to Purchaser. Purchaser shall be
responsible for transportation and insurance costs to ship any claimed defective
Product back to Manufacturer's plant for Manufacturer's review. Manufacturer
shall determine at Manufacturer's cost at its factory whether such Product is in
fact defective. If Purchaser does not agree with Manufacturer's determination
that such Product is not defective, the Parties shall retain an appropriate
expert to be mutually agreed fifteen (15) days of Purchaser's receipt of
Manufacturer's determination to judge ultimately whether such Product is
defective. If the Parties cannot agree on an appropriate expert, each party
shall submit two nominations to the AAA within ten (10) days thereafter for the
AAA to appoint an appropriate expert from such nominees; provided, however, that
the AAA will not administer the proceeding. If either Party does not submit
nominations as described above, the AAA shall appoint an expert from the
nominees it has received. The determination of the expert will be final and
binding on the Parties. The cost for retaining the expert shall be borne by
Manufacturer if such Product is judged defective and by Purchaser if such
Product is judged not to be defective. Any returned Products shall become the
property of Manufacturer. This warranty does not extend to any Products that
have been damaged or rendered defective as a result of: (i) misuse or negligence
on the part of Purchaser or failure of Purchaser or any of its customers to
follow instructions for proper use and care of the Product; (ii) external
factors such as fire and flood; (iii) accidents involving, or modification or
alteration of, the Product other than those caused by Manufacturer after
delivery to Purchaser or (iv) implantation after the "use before" date marked on
the Product's sterile pack.

                           (c) Purchaser and Manufacturer shall discuss in good
faith the nature and content of written product warranties to be extended by
Purchaser to customers with respect to the Products in the Territory. Without
Manufacturer's prior written consent, and except as may be required to comply
with Applicable Laws, Purchaser shall not extend to customers any warranties
with respect to the Products in the Territory which are inconsistent with those
warranties being extended by Manufacturer from time to time outside the
Territory.

                  9.2. RECALLS.

         Purchaser and Manufacturer each shall notify the other promptly if any
Product is the subject of a Recall or other similar event in any jurisdiction,
and the Parties shall reasonably cooperate in the handling and disposition of
such Recall or other similar event; provided, however, in the event of a
disagreement as to any matters related to any proposed Recall or other similar
event, other than the determination of who shall bear the costs as set forth in
the immediately following sentence, each Party shall have the right to cause a
Recall or other similar event to be undertaken. Manufacturer shall bear the
reasonable costs (including without limitation, the cost of locating and
contacting by any means patients and customers, the cost of explanting the
recalled Products and implanting a replacement Product, and the cost of such
replacement Product ("Costs")) of all Recalls of the Products except any
voluntary Recall effected solely by Purchaser, for which Purchaser shall
initially bear all Costs. If subsequent to such voluntary Recall by Purchaser,
events show that Manufacturer wrongfully refused to agree to such Recall, then
Manufacturer shall reimburse Purchaser for all Costs incurred by Purchaser in
connection

<PAGE>


therewith. Notwithstanding the foregoing, Purchaser shall pay the Costs of any
Recall or other similar event if and to the extent caused by (i) any
unauthorized change to the Products by Purchaser which directly results in the
Recall, (ii) the failure of Purchaser to properly store, label or otherwise
handle the Products which directly results in the Recall or (iii) any other
breach of this Agreement by Purchaser which directly results in the Recall.

                  9.3. INDEMNIFICATION FOR THIRD PARTY CLAIMS.

                           (a) Notwithstanding any other provision of this
Agreement, Manufacturer shall be responsible for, and shall assume the defense
of and indemnify and hold Purchaser and its Affiliates (including ELA and its
Affiliates) harmless from and against, all Third Party Claims arising out of or
related to any Products or Technical Materials related thereto manufactured or
supplied by Manufacturer hereunder; provided that the indemnification
obligations of Manufacturer under this Section shall not apply to any Third
Party Claim caused by any misuse, willful misconduct or negligent act or
negligent failure to act on the part of Purchaser with respect to the Products
including any modification or alteration of the Product other than caused by
Manufacturer after delivery to Purchaser and any implantation after the "use
before" date marked on the Product's sterile pack.

                           (b) For purposes of this Agreement, the term "Third
Party Claims" shall mean any and all claims, lawsuits or actions asserted
against Purchaser or its Affiliates (including ELA and its Affiliates) or their
respective directors, officers and agents under any and all Applicable Laws
arising out of or relating to any Product or Technical Materials (including,
without limitation, any data in the Technical Materials that are properly
included in the Promotional Materials with Manufacturer's prior written
approval) related thereto that are manufactured or supplied by Manufacturer or
its Affiliates, including, but not limited to, claims based on strict liability,
tort, negligence or breach of express or implied warranty and claims for
special, incidental, exemplary and consequential damages, in cases in which it
is alleged that personal injury (including, but not limited to, emotional
distress or disturbance), direct financial loss, death or property damage was
caused by a defect in design, material or manufacture of any of the Products or
the Technical Materials (including, without limitation, any data in the
Technical Materials that are properly included in the Promotional Materials with
Manufacturer's prior written approval) related thereto that are manufactured or
supplied by Manufacturer or its Affiliates hereunder including any
misrepresentation or failure to warn in the Technical Materials. "Third Party
Claims" shall also include all losses, liabilities, damages, judgments, awards
and costs (including reasonable attorneys' fees) arising out of or relating to
the claims described in the preceding sentence.

<PAGE>


                  9.4. MANUFACTURER INFRINGEMENT INDEMNIFICATION.

         Manufacturer shall indemnify and hold Purchaser and its Affiliates
(including ELA and its Affiliates) harmless from and against any and all
liabilities, damages, costs or losses (including, without limitation, reasonable
attorneys' fees) arising out of or related to claims or suits asserted or
brought against Manufacturer or Purchaser under any and all Applicable Laws to
the extent such claim or suit is based on alleged infringement, unauthorized use
or misappropriation of patents, mask work rights, copyrights or other
Intellectual Property Rights of a third party in connection with the sale or use
of Products in the Territory (the "Infringement Claims"). In any event,
Manufacturer has the right at any time and in its sole discretion to modify the
design of any Product so that it becomes non-infringing, to obtain a license for
such Products or to cease to provide such Product to Purchaser, provided that
all damages, losses, costs, and expenses incurred by Purchaser that are directly
related to such modification shall be treated as indemnifiable expenses of
Purchaser and its Affiliates (including ELA and its Affiliates) for purposes of
this Section 9.4 and shall be borne by Manufacturer. Purchaser shall use its
Best Efforts to assist and cooperate with Manufacturer in the defense of any
Infringement Claims to the extent Purchaser is the beneficiary of any rights
against the maker of such Infringement Claim pursuant to any agreement the
benefit of which may also inure to the benefit of Manufacturer; provided that
such cooperation shall be at the sole expense of Manufacturer and Purchaser
shall not be required to initiate or join in any litigation in connection
therewith.

                  9.5. LIMITATION ON DAMAGES.

         Except as expressly provided in this Agreement, neither Purchaser nor
Manufacturer shall be liable to the other, for any special, incidental,
exemplary or consequential loss or damage (whether for loss of profit or
otherwise and whether occasioned by the negligence of a Party or its employees
or agents or otherwise) arising out of or in connection with any act or failure
to act of Manufacturer or Purchaser relating to the manufacture or supply of the
Products or, their sale by the Purchaser or arising out of the performance or
non-performance of this Agreement.

         MANUFACTURER'S WARRANTIES SET FORTH IN THIS SECTION 9 ARE ITS EXCLUSIVE
WARRANTIES TO PURCHASER WITH RESPECT TO THE PRODUCTS, AND ARE GIVEN AND ACCEPTED
IN LIEU OF ANY AND ALL OTHER WARRANTIES, GUARANTEES, CONDITIONS AND
REPRESENTATIONS, EXPRESS OR IMPLIED, CONCERNING THE PRODUCTS, WHETHER ARISING
UNDER ANY APPLICABLE LAW OR OTHERWISE INCLUDING, WITHOUT LIMITATION, ANY IMPLIED
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

                  9.6. CERTAIN COVENANTS.

         Purchaser represents, warrants and covenants that:

                           (a) Purchaser will not furnish purchasers of the
Products with any warranties, whether written or oral, beyond those given by
Manufacturer to Purchaser under Section 9.1(a)(iii) and (iv) or stated in any
warranty card or similar material provided by Manufacturer or included with the
Product;

<PAGE>


                           (b) Purchaser shall comply with all Applicable Laws
concerning the use, handling, sale and disposition of the Products in the
Territory.

                  9.7. REPRESENTATIONS AND WARRANTIES OF THE PARTIES.

         Each of Manufacturer and Purchaser hereby represents and warrants to
the other that as of the date hereof:

                  (a) Manufacturer is a corporation and Purchaser is a limited
liability company duly organized and existing in good standing under the laws of
the jurisdiction in which it is incorporated, and has the requisite corporate
power to own its properties and to carry on its business as now being conducted.
Each is duly qualified as a foreign corporation to do business and is in good
standing in every jurisdiction in which the nature of the business conducted or
property owned by it makes such qualification necessary and where the failure to
qualify would have a Material Adverse Effect with respect to such Party.

                  (b) Each has the requisite corporate power and authority to
enter into and perform this Agreement and to perform in accordance with the
terms hereof. The execution and delivery of the Agreement and the consummation
of the transactions contemplated hereby have been duly authorized by its board
of directors and no further consent or authorization of its board of directors
or stockholders is required. The Agreement has been duly executed and delivered
by it. The Agreement constitutes a valid and binding obligation enforceable
against it in accordance with its terms, except as such enforceability may be
limited by applicable insolvency, reorganization, moratorium, liquidation or
similar laws relating to, or affecting generally the enforcement of, creditors'
rights and remedies or by equitable principles of general application.

                  (c) Except as set forth on Schedule 9.7, the execution,
delivery and performance of the Agreement and the consummation of the
transactions contemplated hereby do not (i) result in a violation of its
Articles of Incorporation, or By-laws, or (ii) conflict with, or constitute a
default (or an event which with material notice or lapse of time or both would
become a default) under, or give to others any rights of termination, amendment,
acceleration or cancellation of, any material agreement, material indenture or
material instrument to which it is a party, or result in a violation of any law,
rule, regulation, order, judgment or decree applicable to it or by which any
property or asset of such Party is bound or affected (except in the case of
subclause (ii) above, for such conflicts, defaults, terminations, amendments,
accelerations, cancellations and violations as would not, individually or in the
aggregate, have a Material Adverse Effect). No action, suit, dispute or
proceeding is pending or, to the best knowledge of such Party, threatened
against such Party which, if adversely determined, would prevent such Party from
carrying out its obligations under this Agreement. Each Party's business is not
being conducted in violation of any law, ordinance or regulation of any
Governmental Authority, except for possible violations which either singly or in
the aggregate do not and will not have a Material Adverse Effect. Except as
contemplated by this Agreement, it is not required to obtain any consent,
authorization or order of, or make any filing or registration with, any court or
Governmental Authority in order for it to execute, deliver or perform any of its
obligations under the Agreement.

                  (d) Neither Party shall be deemed to have made any
representation or warranty

<PAGE>


to the other Party except as expressly made in Sections 2.3, 9.1 and this
Section 9.7. Without limiting the generality of the foregoing, and without
prejudice to any express representations and warranties made to either Party in
this Section 9.7, neither Party makes any representation or warranty to the
other with regard to any issues related to Intellectual Property Rights,
projections, estimates or budgets or other matters previously delivered to or
made available to the other with respect to future revenues, expenses,
expenditures or future results of operations. Nothing in this Section 9.7(d)
shall limit any remedy that may be available to a Party pursuant to Applicable
Law.

                  9.8. MITIGATION.

         In the event of any occurrence which may result in either Party
becoming liable for breach of this Agreement, each Party shall use its
reasonable efforts to take such actions as may be reasonably necessary to
mitigate the damages payable by the breaching Party.

                  9.9. INDEMNIFICATION PROCEDURE FOR THIRD PARTY CLAIMS AND
INFRINGEMENT CLAIMS.

         If a Party seeks indemnification hereunder for a matter that involves a
claim by a third party including without limitation, Third Party Claims and
Infringement Claims, the Party seeking indemnification (an "Indemnitee") shall
promptly notify the indemnifying Party (the "Indemnitor") of and shall provide
reasonable information and details concerning the nature of such claim.
Indemnitor shall, to the extent applicable, have the right to assume the defense
at its expense of all third party claims and shall pay all costs and damages
finally awarded against the Indemnitor and the Indemnitee in conjunction with
such third party claims, provided that (i) the Indemnitee provides prompt
written notice to the Indemnitor of its receipt of service of any such claim;
(ii) the Indemnitor controls the defense of the third party claim on behalf of
all Parties; (iii) the Indemnitee consents to representation in such claims by
counsel selected by and representing the Indemnitor; provided, however, that if
outside counsel to the Indemnitee reasonably advises the Indemnitee and the
Indemnitor in a written opinion that such joint representation raises a
potential conflict of interest as between the Indemnitee and the Indemnitor
(other than a conflict concerning the right to indemnification under this
Agreement), then the Indemnitee shall have the right to retain separate counsel
to represent its interests in such third party claim and the reasonable costs,
fees and expenses thereof shall be borne equally by the Indemnitee and the
Indemnitor; and (iv) upon request of the Indemnitor, the Indemnitee uses its
Best Efforts to cooperate with the Indemnitor in defending such third party
claim by providing the Indemnitor with all necessary business information and
relevant documents under its control related to the third party claim and
cooperating with such other reasonable requests of the Indemnitor at the
Indemnitor's expense in accordance with Applicable Law. The Parties' indemnity
obligations under this Article 9 shall not apply to amounts paid in settlement
of any loss, claim, liability or action if such settlement is effected without
the consent of the Indemnitor, which consent shall not be unreasonably withheld.
The Indemnitee's failure to deliver notice to the Indemnitor within a reasonable
time after the commencement of any such action, if materially prejudicial to the
Indemnitor's ability to defend such action, shall relieve the Indemnitor of any
liability to the Indemnitee under this Article 9, but not any liability that it
may have to the Indemnitee otherwise than under this Article 9.

         10.      TERM AND TERMINATION.

<PAGE>


                  10.1. TERM.

         The term of this Agreement shall commence on the date hereof and
terminate on the expiration or termination of the LLC Agreement and shall
terminate upon the commencement of any dissolution or liquidation proceedings
with respect to the Purchaser; provided that, notwithstanding any expiration or
termination of the LLC Agreement or liquidation or dissolution of the Purchaser,
this Agreement shall continue in full force and effect with respect to
Manufacturer's then-current Products for the benefit of Purchaser, or ELA, as
applicable, in accordance with Section 14.2(b)(ii) of the LLC Agreement.

                  10.2. EVENTS OF EARLY TERMINATION.

                           (a) This Agreement may be immediately terminated as
to the entire Territory by either Party, upon giving written notice to the other
Party, in the event that the other Party shall become insolvent or be declared
insolvent or bankrupt by a court of competent jurisdiction or shall be the
subject of any reorganization (other than a corporate reorganization effected in
the ordinary course of business and not arising out of any insolvency) or
winding up, receivership or dissolution, bankruptcy or liquidation proceeding,
or any proceeding or action similar to one or more of the above, in which case
termination shall be effective upon such written notice. The failure of either
Party to give notice of termination upon obtaining knowledge of any such event
shall not be interpreted as a waiver of such Party's rights under this Section
10.2, and such Party reserves the right to exercise any such rights at any time
after the occurrence of any such event.

                           (b) Subject to the further provisions of this Section
10.2(b), upon any material breach or default of this Agreement by either Party,
the non-breaching Party shall have the right to serve notice upon the breaching
Party of its intention to terminate this Agreement in its entirety upon the
expiration of ninety (90) days after the date such notice is given, unless the
breaching Party shall cure any such breach or default within said ninety (90)
day period. Upon the expiration of the applicable cure period, if the breaching
Party shall not have cured the alleged breach to the reasonable satisfaction of
the non-breaching Party, and if the non-breaching Party gives a notice of final
termination, final termination of this Agreement shall be effective on the date
such notice is given. In the event of any dispute as to the existence of a
default or the adequacy of any cure thereof, the Party charged with such alleged
breach or failure to cure may require that the right to terminate be determined
by the dispute resolution mechanism pursuant to Article 12.

                  10.3. RIGHTS AND OBLIGATIONS ON EXPIRATION OR TERMINATION.

         Upon termination or expiration of this Agreement for any reason
whatsoever the following provisions shall apply:

                           (a) After the date which is three (3) months from the
date of termination or expiration, Purchaser shall cease to promote, market or
advertise the Products. Purchaser and Manufacturer shall each cooperate with the
other in an orderly winding up of their respective dealings.

<PAGE>


                           (b) Except in the event of termination of this
Agreement by Purchaser in accordance with Section 10.2 or as a result of the
termination of the LLC Agreement pursuant to Section 14.1(b) thereof where
Manufacturer is deemed the Withdrawing Member (as defined therein), Purchaser
shall within thirty (30) days of expiration or receipt of notice of termination
by Manufacturer certify to Manufacturer the destruction at its own expense of
all Promotional Materials relating to the Products then in the possession of the
Purchaser and shall, if requested by Manufacturer, return, at its own expense,
all samples of Products if such samples have been provided free of charge to
Purchaser.

                           (c) In the event of termination of this Agreement by
Manufacturer in accordance with Section 10.2 or as a result of the termination
of the LLC Agreement pursuant to Section 14.1(b) thereof where Purchaser is
deemed the Withdrawing Member (as defined therein), at Manufacturer's option,
outstanding unpaid invoices rendered by Manufacturer in respect of the Products
shall become immediately due and payable by Purchaser and invoices with respect
to Products ordered prior to termination but for which an invoice has not been
submitted shall be payable immediately upon submission of the invoice. In any
event, Purchaser shall continue to pay all amounts due hereunder prior to the
effective date of termination and all amounts due thereafter including amounts
in respect of the Product ordered by Purchaser prior to the date of termination
and delivered by Manufacturer.

                           (d) To the extent applicable, Purchaser shall provide
the FDA Tracking Information in the form and within the time limits specified in
this Agreement.

                           (e) Purchaser shall provide Manufacturer with such
information regarding patients in whom the Products have been implanted and at
such times as reasonably necessary to allow Manufacturer to service such
Products and comply with all Applicable Laws. Purchaser understands that
Manufacturer or its designee may be obligated to continue to contact Purchaser's
customers after expiration or termination of this Agreement to allow
Manufacturer to comply with United States law and regulatory requirements to
collect and update periodically the FDA Tracking Information throughout the time
the Products are implanted in patients.

                           (f) In the event of termination of this Agreement in
accordance with Section 10.2, or as a result of the termination of the LLC
Agreement pursuant to Section 14.1(b) thereof, the terminating Party may at its
sole discretion cancel by prompt written notice any Orders for the Products
which are unshipped at the date of such termination.

                           (g) Subject to Section 3.4, upon termination or
expiration of this Agreement, each Party shall promptly return to the other
Party all documents, letters, records, notebooks, papers, writings, designs,
drawings, models, blueprints and all other materials and all copies thereof
embodying or showing any of the Technical Information provided by Manufacturer
or any Confidential Information disclosed by either Party, in each case which is
then in the Party's possession or under its control, by whomever prepared, and
all other property owned by one Party but in the possession of the other Party
shall be returned.

                           (h) Unless otherwise expressly provided in this
Agreement, upon the 

<PAGE>


termination or expiration of this Agreement, neither Party shall have any
further duties or obligations to the other under this Agreement; provided,
however, that no such termination or expiration shall relieve either Party from
any liability for which it is otherwise responsible under this Agreement
(including liabilities under Article 9 of this Agreement) with respect to any
event, occurrence, transaction, act or omission which occurred prior to the date
of such termination or expiration or with respect to any losses, liabilities or
claims arising out of any breach or default under this Agreement.

         11.      CONFIDENTIALITY; PUBLICITY; NON-SOLICITATION.

                  11.1. CONFIDENTIAL INFORMATION.

                           (a) Each Party shall (and shall cause its Affiliates,
agents and representatives to), for the term of this Agreement and for six (6)
years after the expiration or termination of this Agreement for any reason, (i)
keep confidential, (ii) not disclose to others, (iii) use only for the purposes
provided for or permitted under this Agreement or the Related Agreements, and
(iv) use Best Efforts, and at least the same degree of care (but no less than a
reasonable degree of care) as it uses to protect its own Confidential
Information of like importance, to prevent unauthorized use, dissemination and
disclosure of, all of the other Party's and its Affiliates' Confidential
Information, except as expressly provided for or permitted by this Agreement.
All Confidential Information shall, as between the Parties and their Affiliates
remain the sole property of the disclosing party or the relevant Affiliate. The
receiving party and its Affiliates, agents and representatives shall have no
rights to the Confidential Information of the disclosing party and its
Affiliates, except as provided in this Agreement. Nothing in this Section 11.1
shall prevent disclosure or use of information which is or becomes public
knowledge without the fault of the receiving party and its Affiliates, agents
and representatives or information already known to, or proven by written
evidence to have been independently derived by, the receiving party or its
Affiliates or received from a third party having the right to convey it.
Notwithstanding the foregoing, such Confidential Information may be (i)
disclosed to a Governmental Authority and to others to the extent such
disclosure may be required to be included in regulatory filings permitted under
the terms of this Agreement or required under Applicable Law; (ii) published by
the receiving party or its Affiliates, if and to the extent such publication has
been approved in writing by the disclosing party; or (iii) disclosed to the
extent required by Applicable Law or as ordered by a court or other regulatory
body having competent jurisdiction. In each of the foregoing cases, the
receiving party will use its Best Efforts to limit the disclosure and maintain
confidentiality of such Confidential Information to the maximum extent
practicable and prior to making any such disclosure it shall use Best Efforts to
consult with the disclosing party regarding the scope of any protective order or
other confidentiality protections that may be available to limit the extent of
disclosure. Any disclosure of Confidential Information to any Affiliates, agents
or representatives of the receiving party shall be limited to a "need to know"
basis for purposes related to this Agreement; provided that (i) the receiving
party shall be responsible and liable to disclosing party for any breach of the
terms of this Section 11.1 by any Affiliate, agent or representative, and (ii)
disclosure by the receiving party to any agent or representative shall be made
pursuant to appropriate confidentiality agreements.

                           (b) The provisions of this Section 11.1 shall survive
and shall remain in

<PAGE>


full force and effect for six (6) years after the expiration or termination or
termination of this Agreement for any reason. For purposes of this Section 11.1
and 11.2, ELA and its Affiliates shall be deemed Affiliates of Purchaser.

                  11.2. PUBLICITY.

         Each Party agrees, and shall cause its Affiliates to, not to issue any
press release disclosing the terms of, or relating to, this Agreement, without
the prior written consent of the other Party; provided; however, that neither
Party or its Affiliates shall be prevented from complying with any duty of
disclosure it may have pursuant to Applicable Law. Such disclosing party shall
use its Best Efforts to consult with the other Party regarding the issuance of
any such press release, or with regard to any public statement disclosing the
terms of this Agreement and shall use its Best Efforts to obtain confidential
treatment for any Confidential Information where such press release or other
public statement is required to be made by Applicable Law.

                  11.3. NON-SOLICITATION.

         Except as otherwise agreed in writing, during the term of this
Agreement and for one (1) year after termination or expiration hereof, each
Party shall refrain from soliciting the personnel of the other Party or its
Affiliates (including, with respect to Purchaser, ELA and its Affiliates),
including without limitation, research and development personnel.

         12.      DISPUTE RESOLUTION PROVISIONS.

                  12.1. GENERAL DISPUTE PRINCIPLES.

                           (a) All disputes between or among the Parties and/or
any of their Affiliates (including the Joint Venture) under this Agreement and
the Related Agreements shall be settled, if possible, through good faith
negotiations between the relevant parties.

                           (b) Disputes as to the specific matters referred to
in Section 6.1(e) and 9.1(b) shall be resolved as provided in such Sections. All
other disputes under this Agreement and the Related Agreements shall be resolved
as provided in Article 12.

                           (c) Prior to resolving any dispute by means of
arbitration or by means of any suit, action or legal proceeding permitted under
Section 12.2, the relevant parties involved in such dispute shall refer such
dispute to their respective Chief Executive Officers or equivalent, who shall
meet in person to negotiate in good faith the possible resolution thereof on at
least two occasions within 30 days before any such party commences arbitration
or other litigation permitted under this Agreement (provided that if any such
party fails or refuses to have a representative attend such meetings within such
thirty (30) day period, the procedures of Section 12.2 shall be applicable after
the conclusion of such thirty (30) day period); and further provided, that (i)
any legal proceedings seeking interim equitable relief (including a temporary
restraining order or preliminary injunction) until such time as such interim
equitable relief can be addressed through arbitration; (ii) proceedings for
provisional relief contemplated by Section 12.2(i) below; and (iii) third party
legal proceedings under Section 12.1(d) below may be commenced immediately.

<PAGE>


                           (d) If a Party or any of its Affiliates (including in
the case of Purchaser ELA and its Affiliates) is subject to a claim, demand,
action or proceeding by a third party and is permitted by law or arbitral rules
to join another party to such proceeding, this Article 12 shall not prevent such
joinder. This Article 12 shall also not prevent either Party or any such
Affiliate from pursuing any legal action against a third party.

                  12.2. ARBITRATION OF OTHER DISPUTES.

                           (a) In the event such good faith negotiations are
unsuccessful, either Party may, after 30 days written notice to the other,
submit any controversy or claim arising out of, relating to or in connection
with this Agreement, or the breach thereof, to arbitration administered by the
American Arbitration Association ("AAA") in accordance with its then existing
International Arbitration rules except that Sections 29 and 31 of the Commercial
Arbitration Rules in effect on the date hereof (a copy of which is attached
hereto as Schedule 12.2) shall govern in the event of any conflict therewith
(collectively, "AAA Rules") and judgment upon the award rendered by the
arbitrator may be entered in any court having jurisdiction thereof.

                           (b) To the extent this Section is deemed a separate 
agreement, independent from this Agreement, Article 13 shall be incorporated
herein by reference. Either Party (the "Initiating Party") may commence an
arbitration by submitting a demand for arbitration ("Demand for Arbitration")
under the AAA Rules and by notice to the other Party (the "Respondent") in
accordance with Section 13.4. Such notice shall set forth in reasonable detail
the basic operative facts upon which the Initiating Party seeks relief and
specific reference to the clauses of this Agreement, the amount claimed, if any,
and any nonmonetary relief sought against the Respondent. After the Demand for
Arbitration, response and counterclaim, if any, and reply to counterclaim, if
any, have been submitted, either Party may propose additional issues for
resolution in the pending proceedings only if expressly so ordered by the
arbitrators.

                           (c) The place of arbitration shall be New York, New
York, and the award shall be deemed a U.S. award for purposes of the Convention
on the Recognition and Enforcement of Foreign Arbitral Awards of 1958 (the "New
York Convention").

                           (d) The Parties shall attempt, by agreement, to
nominate a sole arbitrator for confirmation by the AAA. If the Parties fail
so to nominate a sole arbitrator within 30 days from the date when the
Initiating Party's Demand for Arbitration has been communicated to the
Respondent, a board of three arbitrators shall be appointed by the Parties
jointly or, if the Parties cannot agree as to three arbitrators within 30 days
after the commencement of the arbitration proceeding, then one arbitrator shall
be appointed by each of the Initiating Party and the Respondent within 60 days
after the commencement of the arbitration proceeding and the third arbitrator
shall be appointed by mutual agreement of such two arbitrators. If such two
arbitrators shall fail to agree within 75 days after commencement of the
arbitration proceeding upon the appointment of the third arbitrator, the third
arbitrator shall be appointed by the AAA in accordance with the AAA Rules.
Notwithstanding the foregoing, if any Party shall fail to appoint an arbitrator
within the specified time period, such arbitrator and the third arbitrator shall
be appointed by the AAA in accordance with its then existing rules. For purposes
of this Section, the "commencement

<PAGE>


of the arbitration proceeding" shall be deemed to be the date upon which the
Demand for Arbitration has been delivered to the Parties in accordance with
Section 13.4. Any award shall be rendered by a majority of the arbitrators. A
hearing on the matter in dispute shall commence within 90 days following
selection of the arbitrators, and the decision of the arbitrators shall be
rendered no later than 90 days after commencement of such hearing.

                           (e) An award rendered in connection with an
arbitration pursuant to this Section shall be final and binding upon the
Parties, and the Parties agree and consent that the arbitral award shall be
conclusive proof of the validity of the determinations of the arbitrators set
forth in the award and any judgment upon such an award may be entered and
enforced in any court of competent jurisdiction.

                           (f) The Parties agree that the award of the arbitral
tribunal will be the sole and exclusive remedy between them regarding any and
all claims and counterclaims between them with respect to the subject matter of
the arbitrated dispute. The Parties hereby waive all IN PERSONAM jurisdictional
defenses in connection with any arbitration hereunder or the enforcement of an
order or award rendered pursuant thereto (assuming that the terms and conditions
of this arbitration clause have been complied with).

                           (g) The Parties hereby agree that for purposes of the
New York Convention, the relationship between the Parties is commercial in
nature, and that any disputes between the Parties related to this Agreement
shall be deemed commercial.

                           (h) The arbitrators shall issue a written explanation
of the reasons for the award and a full statement of the facts as found and the
rules of law applied in reaching their decision to both Parties. The arbitrators
shall apportion to each Party all costs (including attorneys' and witness fees,
if any) incurred in conducting the arbitration in accordance with what the
arbitrators deem just and equitable under the circumstances. Any provisional
remedy which would be available to a court of law shall be available from the
arbitrators pending arbitration of the dispute. Either Party may make an
application to the arbitrators seeking injunctive or other interim relief, and
the arbitrators may take whatever interim measures they deem necessary in
respect of the subject matter of the dispute, including measures to maintain the
status quo until such time as the arbitration award is rendered or the
controversy is otherwise resolved. The arbitrator shall have the authority to
award any remedy or relief (except as ex parte relief) that a court of the State
of New York could order or grant, including, without limitation, specific
performance of any obligation created under this Agreement, the issuance of an
injunction, or the imposition of sanctions for abuse or frustration of the
arbitration process, but specifically excluding punitive damages.

                           (i) The Parties may file an application in any proper
court for a provisional remedy in connection with an arbitrable controversy, but
only upon the ground that the award to which the application may be entitled may
be rendered ineffectual without provisional relief. The Parties may also
commence legal action in lieu of any arbitration under this Section 12.2 in
connection with any third party litigation proceedings or for any matter
involving disputes related to Intellectual Property Rights.

                           (j) After the appointment of the arbitrators, the
parties to the arbitration

<PAGE>


shall have the right to take depositions, ask interrogatories, obtain
documentation and to obtain other discovery regarding the subject matter of the
arbitration, and, to that end to use and exercise all the same rights, remedies,
and procedures, and be subject to all of the same duties, liabilities, and
obligations in the arbitration with respect to the subject matter thereof, as if
the subject matter of the arbitration were pending in a civil action before a
United States District Court for the Southern District of New York and such
persons, documents or other requested material were located in the State of New
York. The parties shall reach agreement with the arbitrator on a streamlined and
expedited discovery program in order to save costs and avoid unnecessary delay
in completing any arbitration and may present to the arbitrator for a ruling any
reasons for limiting such discovery in order to save costs and avoid delay.

                           (k) For purposes of any suit, action, or legal
proceeding permitted under this Article 12, each party to this Agreement (a)
hereby irrevocably submits itself to and consents to the non-exclusive
jurisdiction of the United States District Court for the Southern District of
New York for the purposes of any suit, action or legal proceeding in connection
with this Agreement including to enforce an arbitral resolution, settlement,
order or award made pursuant to this Agreement (including pursuant to New York
Convention, the U.S. Arbitration Act, or otherwise), and (b) to the extent
permitted by Applicable Law, hereby waives, and agrees not to assert, by way of
motion, as a defense, or otherwise, in any such suit, action or legal proceeding
pending in such event, any claim that it is not personally subject to the
jurisdiction of such court, that the suit, action or legal proceeding is brought
in an inconvenient forum or that the venue of the suit, action or legal
proceeding is improper. Each party to this Agreement hereby agrees to the entry
of an order to enforce any resolution, settlement, order or award made pursuant
to this Section by the United States District Court for the Southern District of
New York and in connection therewith hereby waives, and agrees not to assert by
way of motion, as a defense, or otherwise, any claim that such resolution,
settlement, order or award is inconsistent with or violative of the laws or
public policy of the laws of the State of New York or any other jurisdiction.

                           (l) All claims arising under this Agreement and all
Related Agreements brought by the Parties and/or their Affiliates (including in
the case of Purchaser ELA and its Affiliates) at substantially the same time
shall be referred to a single arbitration to the extent arbitrable under this
Article 12.

         13.      MISCELLANEOUS.

                  13.1. FEES AND EXPENSES.

         Except as expressly set forth herein, each Party shall be solely
responsible for the payment of the fees and expenses of its advisers, counsel,
accountants and other experts, if any, and all other expenses incurred by such
Party incident to the negotiation, preparation, execution, delivery and
performance of this Agreement.

                  13.2. SEVERABILITY.

         If any provision of this Agreement is held by a court of competent
jurisdiction or panel of arbitrators (including pursuant to enforcement of an
arbitration award under this Agreement) to be

<PAGE>


invalid, unlawful or unenforceable, it shall be modified, if possible, to the
minimum extent necessary to make it valid, lawful, and enforceable or, if such
modification is not possible, it shall be stricken from this Agreement, and the
remaining provisions of this Agreement shall continue in full force and effect;
provided, however, that if a provision is so stricken and is of a nature so as
to fundamentally alter the economic arrangements of this Agreement, the Party
adversely affected may terminate this Agreement by giving to the other Person
sixty (60) days written notice of termination.

                  13.3. ENTIRE AGREEMENT; AMENDMENTS.

         This Agreement and the Schedules hereto, contain the entire
understanding of the Parties with respect to the matters referred to hereby and,
except as specifically set forth herein, neither the Purchaser nor the
Manufacturer makes any representation, warranty, covenant or undertaking with
respect to such matters. No provision of this Agreement may be amended or
supplemented other than by a written instrument signed by the Party against whom
enforcement of any such amendment or supplement is sought.

                  13.4. NOTICES.

         Any notice or other communication required or permitted to be given
herein shall be in writing and shall be effective (a) upon hand delivery or
delivery by telecopy or facsimile at the address or number designated below (if
delivered on a business day during normal business hours where such notice is to
be received), or the first business day following such delivery (if delivered
other than on a business day during normal business hours where such notice is
to be received) or (b) on the third business day following the date of mailing
by express courier service, fully prepaid, addressed to such address, or upon
actual receipt of such mailing, whichever shall first occur. The addresses for
such communications shall be:

        If to the Manufacturer:               With a copy to:
        Angeion Corporation                   Morrison & Foerster, LLP
        3650 Annapolis Lane, Suite 170        425 Market Street
        Plymouth, MN 55447-5434               San Francisco, CA 94105
        Telephone: (612) 550-9388             Telephone: (415) 268-7000
        Telecopier: (612) 509-9521            Telecopier: (415) 268-7522
        Attention: Chief Executive Officer    Attention: Gavin B. Grover, Esq.

<PAGE>


        If to the Purchaser:                  With copies to:
        Angellan Medical Systems, LLC         ELA Medical, Inc.
        2950 Xenium Lane                      2950 Xenium Lane
        Plymouth, MN 55441                    Plymouth, MN 55441
        Telephone: (612) 519-9400             Telephone: (612) 519-9400
        Telecopier: (612) 519-9440            Telecopier: (612) 519-9440
        Attention: Chief Executive Officer    Attention: Chief Executive Officer

                                              ELA Medical
                                              Centre d'Affaires la Boursidiere
                                              92357 Le Plessis Robinson
                                              France
                                              Telephone: (33)(1)46.01.33.01
                                              Telecopier: (33)(1)46.01.33.15
                                              Attention: President

                                              Synthelabo
                                              22 Avenue Galilee
                                              92350 Le Plessis Robinson
                                              France
                                              Telephone: (33)(1)45.37.56.67
                                              Telecopier: (33)(1)45.37.58.04
                                              Attention: General Counsel

                                              and

                                              Coudert Brothers
                                              1114 Avenue of the Americas
                                              New York, NY 10036-7703
                                              Telephone: (212) 626-4400
                                              Telecopier: (212-626-4120
                                              Attention: James C. Colihan, Esq.

         Any Party hereto may from time to time change its address for notices
under this Section 13.4 by giving at least ten (10) days' written notice of such
changed address to the other Party hereto.

                  13.5. NO WAIVER.

         No waiver by either Party of any default with respect to any provision,
condition or requirement of this Agreement shall be deemed to be a continuing
waiver in the future of this Agreement; or a waiver of any other provision,
condition or request of this Agreement; nor shall any delay or omission of
either Party to exercise any right hereunder in any manner impair the exercise
of any such right accruing to it thereafter.

<PAGE>


                  13.6. HEADINGS.

         The headings herein are for convenience only, do not constitute a part
of this Agreement and shall not be deemed to limit or affect any of the
provisions of this Agreement.

                  13.7. SURVIVAL OF PROVISIONS.

         The provisions of Sections 5.2(g), 6.3, 8.1, 8.3, 9.1, 9.2, 9.3, 9.4,
9.5, 9.9, 10.3, 11.1, 11.3, 12.1, 12.2 and Article 13 shall survive the
expiration or termination for any reason of this Agreement.

                  13.8. SUCCESSORS AND ASSIGNS.

         This Agreement shall be binding upon and inure to the benefit of the
Parties and their successors and assigns. Neither this Agreement nor any
interest hereunder shall be assigned or transferred, whether directly or
indirectly, including by operation of law ("Assign" or "Assignment"), by any
Party without the prior express written consent of the other Party (which
consent may be withheld for any reason in the sole discretion of the Party from
whom consent is sought), and any such attempt at Assignment shall be null and
void. The assignment by a Party of this Agreement or any rights hereunder shall
not affect the obligations of such Party under this Agreement.

         Notwithstanding the foregoing, either Party may Assign this Agreement
to an Affiliate (including in the case of Purchaser ELA and its Affiliates) of
such Party so long as any assignment by Manufacturer is made to an Affiliate
that is directly or indirectly 100% owned by, or under 100% common control with,
Manufacturer.

         Any permitted Assignment made pursuant to this Section shall be valid
only if (i) the assigning Party remains liable under this Agreement, and (ii)
the relevant Affiliate or other entity assumes in writing all of the assigning
Party's obligations under this Agreement.

                  13.9. NO THIRD PARTY BENEFICIARIES.

         This Agreement is intended for the benefit of the Parties hereto and
their respective permitted successors and assigns and is not for the benefit of,
nor may any provision thereof be enforced by, any other Person.

                  13.10. GOVERNING LAW.

         The Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of New York.

<PAGE>


                  13.11. INSURANCE.

         Each of Purchaser and Manufacturer will maintain liability insurance
for Third Party Claims in amounts to be agreed upon, but subject to availability
on commercially reasonable terms. Schedule 13.11 sets forth the initial agreed
upon minimum amounts for such liability insurance which amounts shall be
effective until a change in such amounts is mutually agreed in writing. Each of
Purchaser and Manufacturer shall provide copies of certificates of insurance
evidencing compliance with this Section on the date of execution hereof and
within thirty (30) days after the expiration of each policy during the term
hereof.

                  13.12. WAIVERS.

         Each Party hereby waives, to the extent it is able to do so under
Applicable Law, any statutory or other rights it may have or acquire in respect
of the termination of the relationship established hereby pursuant to the terms
of this Agreement, and agrees that the rights available to it hereunder in the
event of such termination are adequate and reflect the agreement of the Parties.
Neither Party shall have any right to claim any indemnity for goodwill or lost
profits or any damages arising from the rightful termination of this Agreement
by the other Party in accordance with the terms of this Agreement.

                  13.13. ENGLISH LANGUAGE CONTROLS.

         The original and controlling version of this Agreement shall be the
version using the English Language. All translations of this Agreement into
other languages shall be for the convenience of the Parties only, and shall not
control the meaning or application of this Agreement. All notices and other
communications required or permitted by this Agreement must be in English, and
the interpretation and application of such notices and other communications
shall be based solely upon the English language version thereof.

                  13.14. RELATIONSHIP OF THE PARTIES.

         For all purposes of this Agreement, Purchaser and Manufacturer shall be
deemed to be independent entities and anything in this Agreement to the contrary
notwithstanding, nothing herein shall be deemed to constitute Purchaser and
Manufacturer as partners, joint venturers, co-owners, an association or any
entity separate and apart from each Party itself, nor shall this Agreement
constitute any Party hereto an employee or agent, legal or otherwise, of the
other Person for any purposes whatsoever. Neither Party hereto is authorized to
make any statements or representations on behalf of the other Party or in any
way obligate the other Party, except as expressly authorized in writing by the
other Party. Anything in this Agreement to the contrary notwithstanding, no
Party hereto shall assume nor shall be liable for any liabilities or obligations
of the other Party, whether past, present or future.

<PAGE>


                  13.15. COUNTERPARTS.

         This Agreement may be executed in two or more counterparts, all of
which shall be considered one and the same Agreement and shall become effective
when counterparts have been signed by each Party and delivered to the other
Party, it being understood that both Parties need not sign the same counterpart.

                  13.16. SOVEREIGN IMMUNITY; EXCLUSIONS.

                           (a) Each Party hereto agrees that, to the extent that
it or any of its property is or becomes entitled at any time to any immunity on
the grounds of sovereignty or otherwise from any legal action, suit or
proceeding, from set off or counterclaim, from the jurisdiction of any set off
or counterclaim, from the jurisdiction of any competent court, from service of
process, from attachment prior to judgment, from attachment in aid of execution,
from execution prior to judgment or from any other legal process in any
jurisdiction, it, for itself and its property, expressly, irrevocably and
unconditionally waives, and agrees not to plead or claim any such immunity with
respect to its obligations, liabilities or any other matter under or arising out
of or in connection with this Agreement or the subject matter of this Agreement
(including without limitation any obligation for the payment of money). Each
Party hereto is not subject to withdrawal in any jurisdiction or under any
statute, including, without limitation, the Foreign Sovereign Immunities Act, 28
U.S.C. ss.ss. 1602 et seq. The foregoing waiver shall constitute a present
waiver of immunity at any time any action is initiated against any Party hereto
with respect to this Agreement.

                           (b) The Parties hereby agree to exclude application
of the following instruments and documents: United Nations Convention on the
International Sale of Goods, UNCITRAL Arbitration Rules and 1990 International
Chamber of Commerce Incoterms.

                  13.17. FORCE MAJEURE.

                           (a) Neither Party shall be responsible or liable to 
the other hereunder for the failure or delay in the performance of this
Agreement due to any event of Force Majeure. In the event of the applicability
of this Section 13.17, the Party failing or delaying performance shall use its
Best Efforts to eliminate, cure and overcome any of such causes and resume the
performance of its obligations. If any event of Force Majeure continues for more
than 180 days, either Party shall have a right to eliminate from the Territory,
on a country by country basis, each country affected by such Force Majeure event
(or terminate this Agreement if all countries are affected) upon written notice
to the other Party delivered while such event of Force Majeure is continuing.
For the avoidance of doubt, in the event that any event of Force Majeure has
occurred and so long as it is continuing, excusing performance by one Party of
its obligations hereunder, the other Party shall also be excused from its
obligations hereunder to the extent its performance is dependent upon the
affected Party's performance.

<PAGE>


                           (b) Upon the occurrence of an event of Force Majeure,
the Party failing or delaying performance shall promptly notify the other Party,
in writing, setting forth the nature of the occurrence, its expected duration
and how such Party's performance is affected. The failing or delaying Party
shall resume performance of its obligations hereunder as soon as practicable
after the Force Majeure event ceases.

         IN WITNESS WHEREOF, the parties hereto have cause this Agreement to be
duly executed by their respective authorized officers as of the date of this
Agreement.

                                        ANGEION CORPORATION


                                        By: /s/ W.A. McFarlin
                                            ------------------------------
                                            Name: W.A. McFarlin
                                            Title: Chairman/CEO


                                        ANGELLAN MEDICAL SYSTEMS, LLC
                                        by its Members

                                             ANGEION CORPORATION


                                             By: /s/ W.A. McFarlin
                                                 ------------------------------
                                                 Name: W.A. McFarlin
                                                 Title: Chairman/CEO


                                             ELA MEDICAL, INC.


                                             By: /s/ Philippe Baetz
                                                 ------------------------------
                                                 Name: Philippe Baetz
                                                 Title: President