<PAGE>

===============================================================================

                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                ----------------

                                   FORM 10-K

(Mark One)

     |X|       ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                          SECURITIES EXCHANGE ACT OF 1934

               For the fiscal year ended June 30, 2001

                                       OR

     |_|       TRANSITION REPORT PURSUANT TO SECTIONS 13 OR 15(d) OF THE
                             SECURITIES EXCHANGE ACT OF 1934

               For the transition period from           to
                        Commission File Number 000-06516
                                ----------------

                                DATASCOPE CORP.
             (Exact name of registrant as specified in its charter)

                 Delaware                                       13-2529596
     (State or other jurisdiction of                         (I.R.S. Employer
      incorporation or organization)                       Identification No.)


            14 Philips Parkway
           Montvale, New Jersey                                   07645
 (Address of principal executive offices)                       (Zip Code)


       Registrant's telephone number, including area code (201) 391-8100
                                ----------------

          SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
                                      None

          SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
                                (Title of Class)

                    Common Stock, par value $0.01 per share
                                ----------------

   Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for at least the past 90 days.
                                Yes |X|   No|_|

   Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K (ss.229.405 of this chapter) is not contained herein,
and will not be contained, to the best of registrant's knowledge, in
definitive proxy or information statements incorporated by reference in Part
III of this Form 10-K or any amendment to this Form 10-K. |X|

   The approximate aggregate market value of the common stock held by non-
affiliates of the registrant as of August 3, 2001 was approximately $513
million. As of August 3, 2001, there were 14,793,567 outstanding shares of the
Registrant's common stock.
                                ----------------

                        DOCUMENTS INCORPORATED BY REFERENCE

   The Registrant's definitive proxy statement to be filed with the Securities
and Exchange Commission no later than October 26, 2001 pursuant to Regulation
14A of the Securities Exchange Act of 1934 are incorporated by reference in
Items 10 through 13 of Part III of this Form 10-K.
===============================================================================

<PAGE>
                               Table of Contents


                                                                            Page
                                                                            ----
                                     Part I
Item 1.    Business ....................................................      3
Item 2.    Properties ..................................................     14
Item 3.    Legal Proceedings ...........................................     14
Item 4.    Submission of Matters to a Vote of Security Holders .........     15
Item 4A.   Executive Officers of the Company ...........................     16

                                     Part II
Item 5.    Market for Registrant's Common Equity and Related
           Stockholder Matters .........................................     17
Item 6.    Selected Financial Data .....................................     18
Item 7.    Management's Discussion and Analysis of Financial Condition
           and Results of Operations ...................................     19
Item 7A.   Quantitative and Qualitative Disclosures About Market Risk ..     25
Item 8.    Financial Statements and Supplementary Data .................     25
Item 9.    Changes in and Disagreements with Accountants on Accounting
           and Financial Disclosure ....................................     25

                                    Part III
Item 10.   Directors and Executive Officers of the Registrant ..........     26
Item 11.   Executive Compensation ......................................     26
Item 12.   Security Ownership of Certain Beneficial Owners and
           Management ..................................................     26
Item 13.   Certain Relationships and Related Transactions ..............     26

                                     Part IV
Item 14.   Exhibits, Financial Statement Schedules, and Reports on Form
           8-K..........................................................     27


<PAGE>

                                     PART I


   This Report on Form 10-K contains statements that constitute "forward-
looking statements" within the meaning of Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, which generally can be identified by the use of forward-looking
terminology such as "may," "will," "expect," "estimate," "anticipate,"
"believe," "target," "plan," "project" or "continue" or the negatives thereof
or other variations thereon or similar terminology. These statements appear in
a number of places in this Report on Form 10-K and include statements
regarding our intent, belief or current expectations that relate to, among
other things, trends affecting our financial condition or results of
operations and our business and strategies. We may make additional written or
oral forward-looking statements from time to time in filings with the
Securities and Exchange Commission or otherwise. Forward-looking statements
speak only as of the date the statement is made. Readers are cautioned that
these forward-looking statements are not a guarantee of future performance and
involve risks and uncertainties, and that actual results may differ materially
from those projected in the forward-looking statements as a result of many
important factors. Many of these important factors cannot be predicted or
quantified and are outside of our control, including competitive factors,
changes in government regulation and our ability to introduce new products.
The accompanying information contained in this Report on Form 10-K, including,
without limitation, the information set forth below under Item 1 regarding the
description of our business and under Item 7 concerning "Management's
Discussion and Analysis of Financial Condition and Results of Operations,"
identifies additional important factors that could cause these differences. We
do not undertake to publicly update or revise our forward-looking statements
even if experience or future changes make it clear that any projected results
expressed or implied in this Report on Form 10-K will not be realized. All
subsequent written and oral forward-looking statements attributable to us or
persons acting for or on our behalf are expressly qualified in their entirety
by this section.

Item 1. Business.

Summary

   Datascope Corp. is a diversified medical device company that manufactures
and markets proprietary products for clinical health care markets in
interventional cardiology and radiology, cardiovascular and vascular surgery,
anesthesiology, emergency medicine and critical care. Our products are
distributed worldwide by direct sales employees and independent distributors.
Originally organized as a New York corporation in 1964, we reincorporated in
Delaware in 1989.

   Below is a summary of our four product lines:

   o Cardiac Assist. Datascope is a leader and pioneer in intra-aortic balloon
     (IAB) therapy (counterpulsation) and products including IAB pumps and
     catheters. The intra-aortic balloon system is used for the treatment of
     high-risk cardiac conditions resulting from ischemic heart disease and
     heart failure. Patients experiencing acute coronary syndromes such as
     acute myocardial infarction, cardiogenic shock, and unstable angina may
     require IAB therapy to support and stabilize their cardiac status. IAB
     therapy is also used for high-risk patients who require revascularization
     procedures such as angioplasty or coronary artery bypass procedures
     including both on-pump and off-pump (OPCAB) techniques.

   o Patient Monitoring. We manufacture and market a broad line of
     physiological monitors designed to provide for patient safety and
     management of patient care. Our monitors are capable of continuous and
     simultaneous measurement of many different vital signs. These monitors
     are used in operating rooms, emergency rooms, critical care units, post-
     anesthesia care units and recovery rooms, intensive care units, labor and
     delivery rooms and magnetic resonance imaging, or MRI units.

   o Collagen Products. Our collagen products and related technology are used
     to seal arterial puncture wounds and to stop bleeding after
     catheterization procedures. We manufacture and sell the VasoSeal line of
     extravascular hemostasis devices. VasoSeal(R) VHD was the first vascular
     sealing device approved in the United States. The VasoSeal devices
     provide for reduced time to hemostasis of the arterial puncture wound,
     reduced time to ambulation, cost savings and increased patient
     satisfaction. In addition, the Collagen Products Division manufactures
     surgical hemostatic agents used to stop bleeding during surgery.



                                       3
<PAGE>

   o Vascular Grafts. Our InterVascular subsidiary markets and sells a
     proprietary line of knitted and woven polyester vascular grafts and
     patches for reconstructive vascular and cardiovascular surgery. Vascular
     grafts are used to replace diseased arteries. InterVascular also
     distributes peripheral vascular stents. Stents are used to treat vascular
     disease non-surgically.

   The following table shows sales by major product line for the last three
years:


                                                              Fiscal Year Ended
                                                                   June 30,
                                                             -------------------
                                                             2001    2000   1999
                                                             ----    ----   ----
      Cardiac Assist ......................................   38%    39%     41%
      Patient Monitoring ..................................   35%    35%     35%
      Collagen Products ...................................   19%    19%     16%
      Vascular Grafts .....................................    8%     7%      8%


Glossary: We have prepared this short glossary to help you understand our
product lines.

Angiogram is a series of X-ray visualizations of the heart and blood vessels.
A radiopaque substance, that is, a material that does not allow the passage of
X-rays through it, is injected into a vein or artery, and X-ray pictures are
then taken in rapid succession. The series of pictures produced reveals the
size and shape of veins or arteries in organs and tissues. An angiogram is
used as a diagnostic tool with certain diseases such as arteriosclerosis. Also
known as cardiac catheterization, this is considered the most accurate test
for ischemic heart disease.

Angioplasty is the reconstruction of blood vessels, usually damaged by
atherosclerosis. If the arteries in question are in the heart, a coronary
bypass operation may be recommended. However, the nonsurgical method of
balloon angioplasty is often employed, especially when only one vessel is
blocked.

Arteriosclerosis, often called "hardening of the arteries," is an arterial
disorder characterized by a progressive thickening and hardening of the walls
of the arteries. This causes a decrease in or loss of blood circulation. The
most common form of arteriosclerosis is atherosclerosis, which is
characterized by the deposition of fatty substances in large and medium-sized
arteries, such as those that lead to the heart and brain. Atherosclerosis and
its complications are a major cause of death in the United States. Heart and
brain disease are often the direct result of this accumulation of fatty
substances that impair the arteries' ability to nourish vital body organs.

Balloon Angioplasty, also known as percutaneous transluminal coronary
angioplasty (PTCA), is a nonsurgical method of clearing coronary and other
arteries, blocked by atherosclerotic plaque, fibrous and fatty deposits on the
walls of arteries. A catheter with a balloon-like tip is threaded up from the
arm or groin through the artery until it reaches the blocked area. The balloon
is then inflated, flattening the plaque and increasing the diameter of the
blood vessel opening. The arterial passage is thus widened or dilated. Balloon
angioplasty has evolved to include direct coronary stenting in greater than
70% of angioplasty procedures to prevent recoil or abrupt closure of the
artery post dilatation.

Coronary Stenting provides mechanical scaffolding that eliminates abrupt
vessel closure or recoil associated with balloon angioplasty.

Coronary Artery Bypass Grafting (CABG) is a surgical procedure for bypassing
coronary artery blockage. This procedure can be performed on-pump (using
cardiopulmonary bypass) or off-pump (without cardiopulmonary bypass).

Hemostasis is the stopping of bleeding, either by physiological properties of
coagulation and vasoconstriction or by surgical or mechanical means.

Below is a more detailed description of our product lines:

   Cardiac Assist. We are a leader and pioneer in intra-aortic balloon therapy
(counterpulsation) and products. Counterpulsation therapy is used to support
and stabilize heart function. This therapy increases the heart's output and
the supply of oxygen-rich blood to the heart's coronary arteries while
reducing the heart muscle's workload and its oxygen demand. Intra-aortic
balloons and pumps are used in counterpulsation therapy for high-risk cardiac
patients suffering from ischemic heart disease and heart failure. These
products and therapy may be used before or during CABG or PTCA procedures for
hemodynamic support. We produce a line of disposable intra-aortic balloon
catheters that serve as the pumping device within the patient's aorta. We
introduced the first balloon catheter capable of percutaneous insertion. This
innovation eliminated the need for surgical insertion. As


                                       4
<PAGE>

a result, the market for cardiac assist products expanded from open-heart
surgery to interventional cardiology. We continue to advance our cardiac
assist technology and to introduce new products.

Intra-Aortic Balloon Pumps

   We manufacture and market the following intra-aortic balloon pumps:

<TABLE>
<CAPTION>
Product                       Features                                          Significant Developments
-------                       --------                                          ------------------------
<S>                  <C>                                                    <C>
System 98XT          o  CardioSync 2 software with improved algorithms to   o  United States and European market introduction in
                        provide enhanced counterpulsation therapy              December 2000

                     o  Faster pneumatics                                   o  Japanese market introduction in July 2001

                     o  Further reduction in required user intervention


System 98            o  Larger display                                      o  Approval to distribute in Japan received in March
                                                                               1999
                     o  Better automation
                                                                            o  Distribution began in 1998 in the United States
                     o  Features make balloon pumping therapy simpler to       and European Union
                        administer and faster to initiate


System 97e           o  Uses CardioSync Software, which assists as many     o  Distribution began in 1998 worldwide
                        heartbeats as possible in the presence of complex
                        heart rhythms                                       o  Introduced in 1997 at the European Society of
                                                                               Cardiology Conference
                     o  Beat-to-beat support can be optimized with minimal
                        user intervention

                     o  Built-in modem

                     o  Contains diagnostic software, which enables us to
                        service the unit by modem


System 97
"Small Wonder"(TM)   o  Compact design takes up less floor space than       o  Worldwide distribution began in 1994
                        competing systems

                     o  Designed for use at bedside or in transport

                     o  Built-in modem allows doctors to make remote
                        diagnosis
</TABLE>

Intra-Aortic Balloon Catheters

   We manufacture a broad line of disposable intra-aortic balloon catheters for
use with intra-aortic balloon pumps in support of counterpulsation therapy.

   Our Profile 8 Fr. intra-aortic balloon catheter, based on a co-lumen, rather
than co-axial design, is the first catheter to allow the cardiac clinician,
such as the interventional cardiologist or cardiovascular surgeon, to utilize
counterpulsation therapy using an 8 Fr. sheath. Prior to introduction of the
Profile 8 Fr., there was not an intra-aortic balloon catheter available that
was small enough to fit through a standard 8 Fr. (2.64 mm) sheath used for the
angioplasty/stent procedure. Use of the Profile 8 Fr. reduces possible
vascular complications when compared to larger catheters.

   The Profile 8 Fr. is the first true 8 Fr. intra-aortic balloon catheter. The
folded balloon membrane diameter is the same as the diameter of the catheter
itself. The Profile 8 Fr. can also be inserted without a sheath. This
combination of sheathless insertion and smaller sized catheters (8 Fr.)
reduces the cross sectional area occupied by the catheter in the artery. This
reduction results in less obstruction to blood flow around the outside of the
catheter and a potential reduction in ischemic complications.

   The Profile 8 Fr. was:

   o Approved by Japanese authorities in March 1999

   o Introduced in the United States in July 1998



                                       5
<PAGE>

   o Approved by the FDA in May 1998

   o Introduced in the European Union in January 1998

   In addition, we manufacture a complete line of intra-aortic balloon
catheters to accommodate counterpulsation therapy in both the adult and
pediatric population. We are also the sole manufacturer of catheters available
for pediatric patients in the 2.5cc, 5cc, 7cc, 12cc and 20cc volumes. Our 9.5
Fr. intra-aortic balloon catheters are available in 25cc, 34cc and 40cc
volumes. A 50cc volume is also available for patients who are taller than 6
feet.

   Clinical Support. We provide the following clinical and educational services
to our customers:

   o Telemedicine via our PC-IABP products which offers remote pump monitoring

   o 24 hour clinical support

   o On-site training and education for all personnel involved with patient
     care

   o Comprehensive educational materials for hospital staff, patient and
     family

   o Consultative services to help hospitals maximize the goals of
     counterpulsation therapy within the hospital network

   o The Benchmark(R) Registry--a comprehensive registry database to assist
     hospitals worldwide in tracking and comparing outcomes of
     counterpulsation therapy administered to their patients. This enables our
     customers to demonstrate and measure the clinical benefits of the
     therapy.

   Markets, Sales and Competition. Our cardiac assist products are sold
primarily to major hospitals with open-heart surgery and balloon angioplasty
facilities and community hospitals with cardiac catheterization laboratories.
Recently, our cardiac assist products have been sold, to a growing degree, to
the broader range of community hospitals, where counterpulsation therapy is
used for temporary support to the patient's heart prior to transport to a
major hospital center where definitive procedures, such as balloon angioplasty
or open heart surgery, can be conducted. Our main competitor for cardiac
assist products is Arrow International Inc.

   Patient Monitoring. We manufacture and market a broad line of physiological
monitors designed to provide for patient safety and management of patient
care. Our monitors are capable of continuous and simultaneous measurement of
many different vital signs. Our monitors are used in operating rooms,
emergency rooms, critical care units, post-anesthesia care units and recovery
rooms, intensive care units, labor and delivery rooms and MRI, or magnetic
resonance imaging units.

Patient Monitors

   Our line of patient monitors and their significant features are as follows:

   PASSPORT(R)2
   o Newest addition to the Passport family of monitors
   o Portable and bedside use with color or EL display and 6 traces
   o Built in power supply
   o Approximately 23% lighter than Passport XG
   o Graph trend of heart rate, respiration and pulse oximetry for neonatal
     applications
   o New Oridion Microstream(R)1 CO2 built into the Passport 2 eliminates the
     use of an external sensor to obtain a CO2 reading
   o Optional Arrhythmia and ST segment analysis
   o Supports Masimo SET(R)2 or Nellcor Oxismart(R)3 pulse oximetry
   o Telemetry or handwire communications to our control stations
   o Compatible with Gas Module II


---------------
(1)   Microstream is a registered trademark of Oridion.
(2)   Masimo SET is a registered trademark of Masimo Corporation.
(3)   Oxismart is a registered trademark of Nellcor Puritan Bennett.



                                       6
<PAGE>

   PASSPORT(R)5L EL
   o Portable and bedside 3 trace capability with electroluminescent display
   o Battery-powered
   o Offers features of a traditional bedside monitor, such as
     electrocardiograms, or ECGs, non-invasive and invasive blood pressure,
     temperature, respiration and pulse oximetry, or blood oxygen saturation
     and CO2
   o Clinical and hospital information system interface capability
   o Telemetry or hardwire communications to our VISA central station

   PASSPORT(R)XG
   o Same as Passport 5L EL, except has a larger and brighter display than
     many competing portable monitors
   o Offers Masimo SET advanced pulse oximetry for motion tolerance
   o Offers mainstream and sidestream CO2
   o Optional complete gas analysis via Gas Module II for operating rooms and
     out-patient applications

   PASSPORT(R) XG-CD
   o Same as Passport XG, but offers a color display

   VISA(TM) and VISA(TM) II
   o Central Station Monitoring system
   o Displays up to eight patients on a single monitor
   o Can support both instrument and ambulatory patient telemetry
   o Compatible with our Expert(R) and Passport monitors
   o Equipment may communicate via hardwire or instrument telemetry
   o Patient information may be exported to hospital and clinical information
     systems
   o Scalable software options tailor the system to customer requirements
   o Optional arrhythmia and full disclosure software
   o ST segment analysis (VISA II only)
   o Extensive networking capabilities (VISA II only)

   PatientNet(R)4
   o Central Station Monitoring system, displays up to eight patients on a
     single monitor
   o Can support both instrument and ambulatory patient telemetry
   o Compatible with our Expert and Passport monitors
   o Patient information may be exported to hospital and clinical information
     systems
   o Telemetry system is WMTS (Wireless Medical Telemetry Service) compliant,
     operating on a dedicated hospital telemetry bandwith in the 608-614 MHz
     range
   o Employs access point technology which reduces the number of antenna
     required in older systems
   o SiteLink(R)4 option lets users view information on patients many miles
     away. This option allows for long distance consultation by clinicians at
     different hospital locations

   Accutorr(R) Plus
   o First non-invasive blood pressure monitor with an integrated patient
     database that automatically records up to 100 patient measurements
   o Also measures pulse oximetry, or blood oxygen saturation, and temperature
   o Optional recorder module
   o Optional Masimo SET or Nellcor Oxismart Pulse Oximetry
   o New longer life lithium ion battery technology

   EXPERT(R)
   o High-end, modular patient monitor
   o Compatible with our VISA and PatientNet central monitoring stations, in
     either hard wire or telemetry mode


---------------
(4)   PatientNet and SiteLink are registered trademarks of VitalCom, Inc.


                                       7
<PAGE>

   o Compatible with our Gas Module II gas measurement subsystem
   o Integrated patient monitoring system combines modular design with
     advanced monitoring features needed in operating rooms, advanced
     emergency departments, intensive care and critical care units

   MR Monitor
   o MRI equipment creates powerful magnetic fields that provide an
     incompatible environment for ordinary patient monitors
   o The MR monitor effectively measures vital signs of patients undergoing
     MRI procedures by incorporating state-of-the-art fiberoptic technology
     which is not affected by powerful magnetic fields

   Gas Module II
   o Anesthetic gas measurement subsystem
   o Monitors CO2, oxygen, nitrous oxide and all 5 inhalated anesthetic gases
   o Interfaces with the controls and displays of the Passport XG and Passport
     2 monitor, for use in the growing out-patient surgery market
   o Interfaces with the controls and displays of the Expert monitor, for use
     in main hospital operating rooms

   We manufacture and market the following sensor systems, which are designed
to be used with our patient monitors:

   FLEXISENSOR(R) Pulse Oximetry Sensors and SENSOR GUARD(R) Bandages
   o Proprietary sensor system for measuring pulse oximetry, or blood oxygen
     saturation
   o Compatible with Passport, Passport XG, and Accutorr Plus
   o Unique semi-disposable sensors offer low cost option for pulse oximetry

   Significant Developments

   In the past five years, we have expanded our patient monitoring product
line:
   o Began shipment of Lithium Ion in the Accutorr Plus product in the first
     quarter of fiscal 2001
   o Began U.S. shipment of PatientNet Central Stations in the second quarter
     of fiscal 2001 and international shipments in the fourth quarter of
     fiscal 2001
   o Began international shipments of the Passport 2 in the first quarter, and
     shipments in the U.S. market in the third quarter of fiscal 2000
   o Received FDA 510(k) clearance for the Passport 2 in January 2000
   o Added Masimo SET SPO2 technology to the Passport XG product line in 1998
   o Began United States shipments of the Gas Module II in 1998
   o Began United States shipments of the Expert in fiscal 1998
   o Received FDA 510(k) clearance of our MR monitor in 1997 and began United
     States shipments in 1998
   o Introduced Accutorr Plus in international markets in fiscal 1996 and the
     United States market in fiscal 1998

   Markets, Sales and Competition. Our patient monitors are used in hospital
operating rooms, emergency rooms, critical care units, post-anesthesia care
units and recovery rooms, intensive care units, labor and delivery rooms and
MRI units. The Passport 2 allows us to further penetrate into our primary
patient monitoring markets and also to enter new markets, such as the NICU
(Neonatal Intensive Care Unit). The PatientNet Central Station network has
allowed us to take advantage of the recent FCC decision to open a dedicated
hospital telemetry bandwidth operating in the 608-614MHz range.

   A number of companies, some of which are substantially larger than us,
manufacture and market products that compete with our patient monitoring
products. Our major competitors are Agilent Technologies (owned by Philips
Electronics), General Electric/Marquette, Spacelabs and Datex.

   Collagen Products. Our vascular sealing products have revolutionized the
technology that is used to seal arterial punctures to stop bleeding after
catheterization procedures, such as balloon angioplasty, stenting and
diagnostic angiography.

   We manufacture and market two main product lines: the VasoSeal VHD and the
VasoSeal ES (Extravascular Security); both vascular hemostasis devices can
rapidly seal arterial punctures after procedures


                                       8
<PAGE>

requiring catheterization. We also manufacture surgical hemostatic agents that
are used to stop bleeding during surgery.

VasoSeal(R) VHD and VasoSeal(R) ES (Vascular Hemostasis Devices)

   We manufacture and market the VasoSeal VHD extravascular sealing device,
which was the first device of its kind to be approved in the United States,
and a second generation sealing device, known as VasoSeal ES. Prior to the
introduction of VasoSeal VHD in 1995, the only way to stop bleeding to seal
arterial puncture wounds after catheterization procedures was to supplement
the body's natural process of blood clot formation through the use of manual
compression or mechanical means such as a "C" clamp. The concept behind the
VasoSeal device is simple and it does not involve prolonged compression. A
soft collagen plug is placed between the puncture in the artery and the
puncture wound in the skin. Sealing is accomplished on the outside of the
artery. By design, no foreign objects remain inside of the artery. In
addition, the use of our VasoSeal products permit immediate removal of the
sheath used in certain coronary and radiology procedures, rather than leaving
the sheath in place for prolonged periods of time.

   The VasoSeal ES device, introduced in the European Union in 1998 and the
United States in 1999, retains the proprietary, extravascular technology of
our original VasoSeal device. However, the VasoSeal ES device features a "one-
size-fits-all" (5 to 8 Fr.) design that eliminates the need to measure skin-
to-artery distance and the hospital's need to stock multiple sizes of the
device. These features are made possible by a unique locator that provides an
easier method for locating the arterial puncture site. VasoSeal ES is also the
first vascular sealing device to have been approved by the FDA for use in
patients with peripheral vascular disease, which represents a significant
portion of the total patient population undergoing catheterization procedures.

   Advantages of VasoSeal

   Using our VasoSeal devices has the following advantages:

   o Reduces time to ambulation. Certain patients can be ambulated much
     faster, compared to conventional manual or mechanical compression. We
     believe faster ambulation should result in significant potential savings
     for hospitals because patients can be moved to lower, less expensive
     levels of care. Early ambulation also lowers the use of human and
     material resources, which results in improved hospital efficiencies

   o Provides increased comfort and satisfaction for patients

   o Frees up valuable recovery room beds

   o Approved for use on patients diagnosed with peripheral vascular disease

   o Eliminates the need for uncomfortable pressure devices, sand bags and
     manual pressure holds

   o Allows the majority of diagnostic angiography patients to be ambulated
     safely within 1 hour after the procedure, compared with 4 to 6 hours
     under standard clinical practice

   o Results in improved patient management within hospitals

   o Approved for deployment by healthcare professionals other than physicians
     (nurses and technicians)

   Clinical Education and Support

   We offer health care providers the following services in connection with
their use of our VasoSeal devices:

   o On-site training and education of all personnel involved with patient
     care

   o 24 hour clinical support

   o Comprehensive educational materials for the staff and patient

   o Consultative services to help facilities identify and maximize the goals
     and objectives of vascular sealing

   Significant Developments

   Since 1993 we have achieved the following regulatory and marketing
   milestones in connection with our VasoSeal product line:

   o In Japan, VasoSeal VHD was cleared for reimbursement for certain
     interventional procedures by The Ministry of Health in January 2000



                                       9
<PAGE>

   o United States shipments of the VasoSeal ES device began in August 1999

   o The VasoSeal ES device was approved by the FDA in December 1998

   o In 1998, we began marketing the VasoSeal device in Germany, France and
     the United Kingdom

   o We received the "CE" mark for the VasoSeal device in 1997 and the
     VasoSeal ES device in 1998, which permits us to sell our VasoSeal product
     line throughout the European Union

   o In 1994, we received regulatory approval to market the VasoSeal device in
     Japan

   o During calendar years 1993 through 1995, we received regulatory approvals
     to market the VasoSeal device in Canada, Australia, Italy, Spain and The
     Netherlands

   o Pre-Market Approval (PMA) for the VasoSeal device approved by the FDA in
     September 1995

   The VasoSeal VHD device has received the following additional approvals from
the FDA:

   o Approval received in August 1999 to market the VasoSeal VHD for use in
     patients with peripheral vascular disease

   o Approval received in September 1997 for deployment of VasoSeal by nurses
     and technicians

   o Approval received in April 1997 for use after stent implantation

   o Approval received in December 1996 for use of VasoSeal in radiology
     procedures

   o Approval received in August 1996 for early ambulation in diagnostic
     angiography and delayed sheath pull interventional patients

   Markets, Sales and Competition. Our VasoSeal line of products is sold to
both interventional cardiology and radiology labs, both in hospitals and
independent diagnostic facilities.

   We believe that our VasoSeal products have created a new market for improved
sealing and management of femoral arterial puncture wounds made during
catheterization procedures. In addition, our VasoSeal products can also be
used following stent implantation. Stents, which are devices that support the
arterial wall, are implanted in over 70% of coronary and peripheral balloon
angioplasty procedures in the United States.

   A number of companies, some of which are substantially larger than us,
manufacture and market products that compete with the VasoSeal VHD and
VasoSeal ES devices. Our competitors are Abbott Laboratories (Perclose), St.
Jude Medical (Angio-Seal), Vascular Solutions, Inc. (Duett), Sutura, Inc.
(Super Stitch) and Marine Polymer Technologies (Syvek Patch).

   Vascular Grafts. Our InterVascular Inc. subsidiary manufactures and
distributes a proprietary line of knitted and woven polyester vascular grafts
and patches for reconstructive vascular and cardiovascular surgery. Vascular
grafts are used to replace and bypass diseased arteries. InterVascular also
began distribution of peripheral stents in Europe in late fiscal 2001. Fiscal
2001 sales of stents were not material.

   Our vascular graft products and their significant features are:

   InterGard(R) Knitted Products

   o Collagen-coated graft for use in most vascular applications for
     reconstruction of abdominal and peripheral arteries

   InterGard(R) Woven Products

   o Designed primarily for use in thoracic aortic repair and open-heart
     surgery

   InterGard(R) Silver

   o World's only anti-microbial vascular graft

   o Designed to prevent post-operative infection of the graft, which occurs
     in between 2% and 5% of cases, by using the broad spectrum, anti-
     infective properties of silver, which is released from the surface of the
     graft and onto surrounding tissues following implantation

   o Prosthetic graft infections are associated with high morbidity, including
     amputation and high mortality


                                       10
<PAGE>

   o Infection typically lengthens the hospital stay of a patient by up to 50
     days, which usually results in a significant increase in cost

   InterGard Ultra Thin(TM)

   o The thinnest knitted polyester collagen coated graft on the market

   o Designed specifically for use in the replacement of peripheral arteries

   InterGard(R) Heparin

   o A heparin bonded collagen coated graft for replacement and bypass of
     peripheral arteries

   HemaCarotid Patches

   o Collagen-coated patches used for repair of carotid and peripheral
     arteries

   o HemaCarotid patches also manufactured in Ultra Thin version

   Significant Developments

   In the last few years, we have expanded our vascular graft product line:

   o InterGard Heparin received FDA approval in January 2001

   o InterGard UltraThin was introduced in the United States during fiscal
     year 1999

   o InterGard Silver received the CE mark in April 1999, for commercial sale
     throughout the European Union

   o InterGard Woven Products were introduced in the United States during
     fiscal year 1999

   o Approval of InterGard in both the United States and Japan in fiscal year
     1998

   Markets, Sales and Competition. Our vascular graft products are sold to
vascular and cardiothoracic surgeons. Products are distributed exclusively in
the United States by Impra, a subsidiary of C.R. Bard, Inc.

   A number of companies, some of which are substantially larger than us,
manufacture and market products that compete with our vascular graft products.
Our major competitors are Boston Scientific, Vascutek and Gore.

   Life Science Research Products. In 1998, we entered the life science
research market by forming a new subsidiary, Genisphere Inc. Genisphere has
developed reagents based on a new, proprietary class of DNA molecules known as
3DNA(R), or Three Dimensional Nucleic Acid. A reagent is a biologically or
chemically active substance. Genisphere's reagents are used to detect and
measure other biological substances. Our 3DNA-based reagents have been shown
to increase the sensitivity of nucleic acid detection and may also provide
substantially greater sensitivity for the detection of proteins than was
previously possible using conventional assays. Our first products were probes
designed for use in conventional blot assays. Genisphere had an agreement with
Fisher Scientific LLC that provided Fisher with the non-exclusive right to
distribute only Genisphere's first generation blot products in the U.S. and
Puerto Rico. Genisphere terminated its distribution agreement with Fisher
effective in September 2000 because we are no longer actively promoting the
first generation blot products.

   Based on our new market entry strategy, our life science research products
will be primarily targeted at the research and development department of
pharmaceutical and biotechnology companies. In this new target market, use of
new research technologies occurs much faster and potential customers are more
highly concentrated and easier to reach, when compared to the mature academic
research market, which was our initial target market. Our first products for
this market are detection systems designed to improve the reliability and
sensitivity of microarray experiments.

   A number of companies, some of which are substantially larger than us,
manufacture and market products that compete with our life science research
products. Our major competitors include Amersham Pharmacia Biotech,
PerkinElmer Life Sciences Inc., Molecular Probes, Inc. and Clontech
Laboratories Inc., a subsidiary of Becton Dickinson & Co.


                                       11
<PAGE>

Research and Development

   We invested approximately $24.4 million in 2001, $24.4 million in 2000 and
$28.5 million in 1999 on research and development of new products and the
improvement of our existing products. We have established relationships with
several teaching hospitals for the purpose of clinically evaluating our new
products. We also have consulting arrangements with physicians and scientists
in the areas of research, product development and clinical evaluation.

Our Marketing and Sales Organization

   Our products are sold throughout the world through our own direct sales
organization and through independent distributors. Our worldwide sales
organization employs approximately 400 people, and consists of sales
representatives, sales managers, clinical education specialists and sales
support personnel. We have a worldwide clinical education staff, most of whom
are critical care and catheterization lab nurses. They conduct seminars and
provide in-service training to nurses and physicians on a continuing basis.
Our sales are broadly based and no customer accounts for more than 10% of our
total sales.

   We provide service and maintenance to purchasers of our products under
warranty. After the warranty expires, we provide service and maintenance on a
contract basis. We employ service representatives in the United States and
Europe, and maintain service facilities in the United States, The Netherlands,
France, Germany and the United Kingdom. We conduct regional service seminars
throughout the United States for our customers and their biomedical engineers
and service technicians.

   International sales as a percentage of our total sales were 29% in 2001, 29%
in 2000 and 28% in 1999. We have subsidiaries in the United Kingdom, France,
Germany, Italy, Belgium, Spain and The Netherlands. Because a portion of our
international sales are made in foreign currencies, we bear the risk of
adverse changes in exchange rates for such sales. Please see Notes 1, 2 and 9
to the Financial Statements for additional information with respect to our
international operations and foreign currency exposures.

Competition

   We believe that customers, primarily hospitals and other medical
institutions, choose among competing products on the basis of product
performance, features, price and service. In general, we believe price has
become an important factor in hospital purchasing decisions because of
pressure to cut costs. These pressures on hospitals result from Federal and
State regulations that limit reimbursement for services provided to Medicare
and Medicaid patients. Many companies, some of which are substantially larger
than us, are engaged in manufacturing competing products. We have identified
our major competitors in the above sections which described our product lines.

Suppliers

   Our products are made of components which we manufacture or which are
usually available from existing and alternate sources of supply. We purchase
certain components from single or preferred sources of supply. Our use of
single or preferred sources of supply increases our exposure to price
increases and production delays. In the second quarter of fiscal 2001, our
sole supplier of printed circuit boards could not produce the quantities
needed to support planned requirements for Passport 2 patient monitors and
System 98 balloon pumps. During the third quarter of fiscal 2001, this supply
issue was resolved and a second source of supply was added. In addition,
certain of our suppliers have been contemplating, and in a few cases have
begun, reducing or eliminating sales of their products to medical device
manufacturers like us. We are not able to predict whether or not additional
suppliers will withhold their products from medical device manufacturers,
including us. Except as stated above, to date, we have not experienced any
material disruption or delay in processing our components.

Patents

   We hold a number of United States and foreign patents. In addition, we also
have filed a number of patent applications that are currently pending. We do
not believe the expiration or invalidity of any of our patents would have a
material adverse effect on our business as currently conducted.


                                       12
<PAGE>

Employees

   We currently employ approximately 1,350 people. We believe our relationship
with our employees is good.

Regulation

   Our medical devices are subject to regulation by the FDA. In some cases,
they are also subject to regulation by state and foreign governments. The
Medical Device Amendment of 1976 and the Safe Medical Device Act of 1990,
which are amendments to the Federal Food, Drug and Cosmetics Act of 1938,
require manufacturers of medical devices to comply with certain controls that
regulate the composition, labeling, testing, manufacturing and distribution of
medical devices. FDA regulations known as "Current Good Manufacturing
Practices for Medical Devices" provide standards for the design, manufacture,
packages, labels, storage, installation and service of medical devices. Our
manufacturing and assembling facilities are subject to routine FDA
inspections. The FDA can also conduct investigations and evaluations of our
products at its own initiative or in response to customer complaints or
reports of malfunctions. The FDA also has the authority to require
manufacturers to recall or correct marketed products which it believes do not
comply with the requirements of these laws.

   Under the Act, all medical devices are classified as Class I, Class II, or
Class III devices. In addition to the above requirements, Class II devices
must comply with pre-market notification, or 510(k), regulations and with
performance standards or special controls established by the FDA. Subject to
certain exceptions, a Class III device must receive pre-market approval from
the FDA before it can be commercially distributed in the United States. Our
principal products are designated as Class II and Class III devices.

   We also receive inquiries from the FDA and other agencies. Sometimes, we may
disagree with positions of members of the staffs of those agencies. To date,
the resolutions of such disagreements with the staffs of the FDA and other
agencies have not resulted in material cost to us.

   We are also subject to certain federal, state and local environmental
regulations. The cost of complying with these regulations has not been, and we
do not expect them to be, material to our operations.

   We are also affected by laws and regulations concerning the reimbursement of
our customers' costs incurred in purchasing our medical devices and products.
Healthcare providers that purchase our medical devices and products generally
rely on third-party payors, including the Centers for Medicare and Medicaid
Services (CMS) which administers Medicaid and Medicare, and other types of
insurance programs, to reimburse all or part of the cost of such devices. The
laws and regulations in this area are constantly changing and we are unable to
predict whether, and the extent to which, we may be affected in the future by
legislative or regulatory developments relating to the reimbursement of our
medical devices and products.

   On August 1, 2000, CMS established a product-specific reimbursement system
for devices used in the hospital outpatient setting that provided for
reimbursement for VasoSeal ES and, as of October 1, 2000, for VasoSeal VHD.
Effective April 1, 2001, CMS replaced the product-specific reimbursement
system with a new system that provides reimbursement for specific types of
devices, including vascular closure devices. VasoSeal VHD and ES devices are
eligible for reimbursement under this new system as well. These special
payments may continue until January 1, 2003 when CMS will place the products
into appropriate clinical Ambulatory Payment Classifications.

   Certain of our products are regulated by the United States Department of
Agriculture (USDA) because they contain collagen from cattle. On August 14,
2001, the USDA issued new interim regulations restricting the importation into
the United States of collagen-containing products processed in certain
countries, including France and The Netherlands. We are currently assessing
these very new interim regulations and their potential impact, if any, on our
business.

Health Care Reform

   We believe that concerns about potential health care reform legislation have
slowed the domestic sales of medical devices generally. Our management cannot
predict at this time what impact, if any, the adoption by the United States
Congress of health care reform legislation will have on our business.



                                       13
<PAGE>

Item 2. Properties.

   The following table contains information concerning our significant real
property that we own or lease:

<TABLE>
<CAPTION>
                                                                                                         Ownership or
                                              General Character                                           Expiration
Location                                     and Use of Property                                         Date of Lease
--------                                     -------------------                                         -------------
<S>                                  <C>                                                            <C>
Fairfield, New Jersey                75,000 sq. feet, used for Cardiac Assist facility and          Owned
                                     manufacturing of intra-aortic balloons.

Hatfield, Pennsylvania               15,000 sq. feet, used for Genisphere research and              Leased (until
                                     development, manufacturing and warehousing                     6/30/11)

Hoevelaken, The Netherlands          12,700 sq. feet, used for administrative offices and the       Owned
                                     European central warehouse.

La Ciotat, France                    30,000 sq. feet, used by InterVascular for manufacturing       Owned--18,000 sq. feet
                                     and warehousing of vascular grafts and administrative          Leased--12,000 sq. feet (until
                                     offices.                                                       5/30/07)

Mahwah, New Jersey                   130,000 sq. feet, used for:                                    Owned
                                     o Patient Monitoring facility--manufacturing
                                       and warehousing of patient monitoring
                                       products, research and development
                                       and administrative offices.
                                     o Manufacturing of cardiac assist balloon
                                       pump systems.

Mahwah, New Jersey                   90,000 sq. feet, used for:                                     Owned
                                     o Collagen Products facility--manufacturing,
                                       warehousing, research and development
                                       and distribution of collagen products
                                       and administrative offices.
                                     o Warehousing, packaging and distribution of
                                       cardiac assist products.
                                     o Corporate records storage.

Montvale, New Jersey                 38,000 sq. feet, used for corporate headquarters.              Owned

Vaals, The Netherlands               17,500 sq. feet, used in the manufacturing, warehousing        Owned
                                     and research and development for collagen products.
</TABLE>


   We also lease office space in the United States, England, France, Italy,
Belgium, Spain and Germany. We believe that our facilities and equipment are
in good working condition and are adequate for our needs.

Item 3. Legal Proceedings.

   We are subject, in the ordinary course of our business, to product liability
litigation. We believe we have meritorious defenses in all material pending
lawsuits. We also believe that we maintain adequate insurance against any
potential liability. We receive comments and recommendations with respect to
our products from the staff of the FDA and from other agencies on an on-going
basis. We may or may not agree with these comments and recommendations.
However, we are not a party to any formal regulatory administrative
proceedings.

   On July 21, 1999, we instituted patent infringement litigation relating to a
vascular sealing method against Vascular Solutions, Inc. in the United Stated
District Court, District of Minnesota. In that litigation, our



                                       14
<PAGE>

complaint alleges that the manufacture, use and/or sale of Vascular Solutions'
Duett device, infringes our United States Patent No. 5,725,498. We seek relief
in the form of a preliminary and permanent injunction against the marketing
and/or sale of Vascular Solutions' Duett device.

   In response to our complaint, Vascular Solutions filed an answer and
counterclaim. Their answer generally denied the allegations of our complaint
and their counterclaim claimed that we tortiously interfered and unfairly
competed by filing the complaint which impacted upon their ability to raise
capital through an initial public offering. In March 2001, their counterclaim
was dismissed. We believe that we will be successful in prosecuting our
complaint.

   In response to a Declaratory Judgment action filed by us on June 29, 2000
against Arrow International Inc. (Arrow) in the United States District Court
for the District of New Jersey, Arrow counterclaimed against us on October 18,
2000 alleging that we were infringing on its United States Patent for intra-
aortic balloon (IAB) insertion without the use of a sheath. The matter is now
in the discovery stage and we have filed a motion for summary judgment, based
on a re-capture argument, requesting that the Court declare Arrow's patent for
IAB insertion without the use of a sheath invalid. Arrow filed a brief in
response to the motion, a hearing on the motion was had on July 23, 2001 and
the parties are awaiting the Court's decision on the summary judgment motion.
We believe that we will be successful in this action.

   In December 2000, an action was filed in New York Supreme Court against us
and our board of directors entitled David B. Shaev v. Lawrence Saper, Alan B.
Abramson, David Altschiller, Joseph Grayzel, M.D., George Heller, Arno Nash
and Datascope Corp. The complaint alleges, inter alia, common law claims for
breach of the duty of loyalty and breach of fiduciary duty for approving
allegedly excessive compensation to defendant Saper. By agreement, the time to
respond to this complaint has been extended. We believe that the claims in
this action are wholly without merit and intend to defend this action
vigorously.

   In August 2001, an action was filed in United States District Court for the
District of New Jersey against us and our board of directors entitled David B.
Shaev v. Lawrence Saper, Alan B. Abramson, David Altschiller, Joseph Grayzel,
M.D., George Heller, Arno Nash and Datascope Corp.  The Complaint alleges,
inter alia, that the directors breached their duties of good faith and loyalty
and that our October 27, 2000 proxy statement omitted material facts, was
coercive and contained materially false and misleading statements. According
to the Complaint, the proxy statement (i) was false insofar as it stated that
we would receive a deduction for federal income tax purposes for Mr. Saper's
bonus compensation, (ii) failed to disclose reasonable estimates of the
bonuses payable and the number of persons eligible under the Management
Incentive Plan and (iii) coercive insofar as it stated that we might grant Mr.
Saper a bonus if the Plan were not approved by the stockholders.  The
Complaint also alleges that the defendant directors (i) were negligent since
they knew or should have known that the representations concerning the
deductibility of Mr. Saper's bonus were false and misleading and (ii) breached
their duties of loyalty and good faith by coercing the stockholders to vote
for the plan and by approving the allegedly excessive payments to Mr. Saper.
We believe that the claims in this action are wholly without merit and intend
to defend this action vigorously.

   In September 1999, we terminated a distributor agreement with Biomed S.A.
The agreement provided for the distribution of our cardiac products in Spain.
In addition, we also started to market our cardiac products in Spain for
ourselves. In July 2000, Biomed brought an action against us in Spain seeking
to have the Spanish Court declare Biomed an exclusive distributor of our
products. In October 2000, the Spanish Court ruled that Biomed was not an
exclusive distributor of our products in Spain. Subsequent to that ruling,
Biomed commenced a second action against us seeking damages and we are
presently preparing our answer to that action. We believe, as in the first
action, we will be successful in this action filed by Biomed.

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

   No matters were submitted to a vote of security holders in the fourth
quarter of fiscal year 2001.


                                       15
<PAGE>

Item 4A. Executive Officers of the Company.

   The following table sets forth the names, ages, positions and offices of our
executive officers:

<TABLE>
<CAPTION>
Name                                            Age             Positions and Offices Presently Held
----                                            ---             ------------------------------------
<S>                                             <C>     <C>
Lawrence Saper...........................       73      Chairman of the Board and Chief Executive Officer
Murray Pitkowsky.........................       70      Senior Vice President and Secretary
Nicholas E. Barker.......................       43      Vice President, Design
Gregory Cash.............................       44      Vice President; President InterVascular Inc.
James L. Cooper..........................       50      Vice President, Human Resources
Thomas Dugan.............................       43      Vice President, Business Development
John Gilbert.............................       44      Vice President; President, Collagen Products Division
Brent Glendening.........................       47      Vice President and Chief Information Technology Officer
Leonard S. Goodman.......................       57      Vice President, Chief Financial Officer and Treasurer
Donald Southard..........................       55      Vice President; President, Patient Monitoring Division
Paul J. Southworth.......................       57      Vice President; President, Cardiac Assist Division
S. Arieh Zak.............................       40      Vice President, Regulatory Affairs and Corporate Counsel
</TABLE>


                                       16
<PAGE>

                                    PART II

Item 5. Market for the Registrant's Common Equity and Related Stockholder
Matters.

Market Information

   Our common stock is traded over-the-counter and is listed on the Nasdaq
National Market. Our Nasdaq symbol is DSCP. The following table sets forth,
for each quarter period during the last two fiscal years, the high and low
sale prices as reported by The Nasdaq Stock Market.

   Fiscal Year                                             High          Low
   -----------                                             ----          ---
   2000
    First Quarter .....................................   35 3/4       29 3/4
    Second Quarter ....................................   41           33
    Third Quarter .....................................   42 1/2       30 15/16
    Fourth Quarter ....................................   40 1/4       31 1/16
   2001
    First Quarter .....................................   37 1/4       31 1/8
    Second Quarter ....................................   37 7/16      30 13/16
    Third Quarter .....................................   38 1/8       32 1/2
    Fourth Quarter ....................................   46 15/32     34 1/16


   As of August 3, 2001, there were approximately 648 holders of record of our
common stock.

Dividend Policy

   On December 7, 1999, the Board of Directors inaugurated quarterly cash
dividends. During fiscal year 2001, a cash dividend of $0.04 per share of
common stock was paid on September 29, 2000, and cash dividends of $0.05 per
share of common stock were paid on January 12, 2001, March 30, 2001 and July
2, 2001. Our dividend policy is reviewed periodically.

Recent Sales of Unregistered Securities

   None.



                                       17
<PAGE>

Item 6. Selected Financial Data.

   The following table sets forth selected financial data for Datascope as of
the dates and for the periods indicated. The data should be read in
conjunction with "Management's Discussion and Analysis of Financial Condition
and Results of Operation" and the financial statements and related notes
thereto on pages F-1 to F-24.

                         SELECTED FINANCIAL INFORMATION

Earnings Statement Data:
 (in thousands, except per share data)

<TABLE>
<CAPTION>

                                                                                               Year Ended June 30,
                                                                             ------------------------------------------------------
                                                                               2001       2000        1999        1998       1997
                                                                               ----       ----        ----        ----       ----
<S>                                                                          <C>        <C>         <C>         <C>        <C>
Net Sales (A)............................................................    $312,800   $301,400    $271,500    $244,700   $227,800
Cost of sales (A)........................................................     125,030    119,665     106,646      96,024     92,240
Research and development.................................................      24,402     24,426      28,524      29,781     26,270
Selling, general and administrative (A)..................................     117,571    116,792     105,847      93,940     87,262
Special Items............................................................          --     (3,825)      3,429          --      8,554
                                                                             --------   --------    --------    --------   --------
                                                                              267,003    257,058     244,446     219,745    214,326
                                                                             --------   --------    --------    --------   --------
Operating earnings.......................................................      45,797     44,342      27,054      24,955     13,474
Other (income) expense:
 Interest income.........................................................      (3,669)    (3,659)     (3,342)     (4,972)    (4,744)
 Interest expense........................................................          51         21          29          25         18
 Other, net..............................................................        (176)       132         583         187        380
                                                                             --------   --------    --------    --------   --------
                                                                               (3,794)    (3,506)     (2,730)     (4,760)    (4,346)
                                                                             --------   --------    --------    --------   --------
Earnings before taxes on income..........................................      49,591     47,848      29,784      29,715     17,820
Taxes on income..........................................................      15,348     14,773       8,372       8,074      3,716
                                                                             --------   --------    --------    --------   --------
Net earnings.............................................................    $ 34,243   $ 33,075    $ 21,412    $ 21,641   $ 14,104
                                                                             ========   ========    ========    ========   ========
Earnings per share, Basic................................................    $   2.30   $   2.18    $   1.40    $   1.37   $   0.88
Earnings per share, Diluted..............................................    $   2.20   $   2.06    $   1.36    $   1.32   $   0.86

<CAPTION>

Balance Sheet Data:
   (in thousands)                                                                              Year Ended June 30,
                                                                             ------------------------------------------------------
                                                                               2001       2000        1999        1998       1997
                                                                               ----       ----        ----        ----       ----
<S>                                                                          <C>        <C>         <C>         <C>        <C>
Total assets.............................................................    $310,335   $295,326    $269,453    $253,171   $238,187
Long-term debt...........................................................           -         --          --          --         --
Working capital..........................................................     129,715    120,298     125,261     115,892    121,575
Stockholders' equity.....................................................     243,478    227,286     214,295     201,406    192,243
Cash dividends...........................................................       2,805      1,809          --          --         --
</TABLE>

---------------
(A) In accordance with Emerging Issues Task Force Issue 00-10, "Accounting for
    Shipping and Handling Fees and Costs," sales for all periods have been
    reclassified to include shipping and handling fees billed to customers and
    the corresponding expenses have been included in cost of sales. These
    amounts were previously recorded in selling, general and administrative
    expenses. The reclassification had no effect on operating or net income.


                                       18
<PAGE>

Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations.

Results of Operations

   The following table shows the comparison of net earnings and earnings per
diluted share over the past three fiscal years.


                                                        (Dollars in millions,
                                                             except EPS)
                                                       ----------------------
                                                         Year ended June 30,
                                                       ----------------------
                                                        2001    2000     1999
                                                        ----    ----     ----
      Net Earnings (1) ..............................  $34.2    $33.1   $21.4
      Earnings per share, diluted (1) ...............  $2.20    $2.06   $1.36


Comparison of Results--Fiscal 2001 vs. Fiscal 2000

Sales

   The following table shows sales by product line over the past three fiscal
years.


                                                      Sales by Product Line (2)
                                                        (Dollars in millions)
                                                         Year ended June 30,
                                                      -------------------------
                                                       2001     2000      1999
                                                       ----     ----      ----
      Cardiac Assist...............................   $119.0   $117.9    $111.6
       % change from prior year ...................        1%       6%        8%
       % of total sales ...........................       38%      39%       41%
      Patient Monitoring...........................   $110.7   $105.2    $ 96.0
       % change from prior year ...................        5%      10%        4%
       % of total sales ...........................       35%      35%       35%
      Collagen Products ...........................   $ 58.8   $ 57.0    $ 43.3
       % change from prior year ...................        3%      32%       47%
       % of total sales ...........................       19%      19%       16%
      Vascular Grafts .............................   $ 23.3   $ 21.0    $ 20.6
       % change from prior year ...................       10%       2%        9%
       % of total sales ...........................        8%       7%        8%
      Genisphere...................................   $  1.0   $  0.3    $   --
       % change from prior year ...................       --       --        --
       % of total sales ...........................       --       --        --
      Total Sales..................................   $312.8   $301.4    $271.5
       % change from prior year ...................        4%      11%       11%

---------------
(1) Net earnings and earnings per share in fiscal years 2001, 2000 and 1999
    shown above include the following special items.

            Fiscal 2001 Gain on sale of underutilized facility of $356 thousand
            after tax or $0.02 per diluted share.

            Fiscal 2000 Gain on sale of technology of $2.5 million after tax or
            $0.16 per diluted share.

            Fiscal 1999 Restructuring charge of $2.2 million after tax or $0.14
            per diluted share.

    Excluding the special items, net earnings and diluted earnings per share
    was $33.9 million or $2.18 per diluted share in fiscal 2001, $30.6 million
    or $1.90 per diluted share in fiscal 2000 and $23.6 million or $1.50 per
    diluted share in fiscal 1999.

(2) Sales for all periods include shipping and handling fees billed to
    customers, in accordance with Emerging Issues Task Force Issue 00-10,
    "Accounting for Shipping and Handling Fees and Costs," which we adopted in
    the fourth quarter fiscal 2001.



                                       19
<PAGE>

   Sales of the Cardiac Assist / Monitoring Products segment in fiscal 2001
increased 3% to $229.7 million.

 Cardiac Assist

   Sales of Cardiac Assist products increased 1% to $119.0 million. Sales of
intra-aortic balloon pumps increased 5% as a result of strong customer demand
for the System 98XT, our advanced performance balloon pump launched in the
first quarter of fiscal 2001. Sales of balloon catheters decreased 1% while
unit sales increased slightly. The Profile 8 Fr. catheter continued its strong
growth and market penetration, accounting for 59% of worldwide balloon
catheter unit sales compared to 53% last year.

 Patient Monitoring

   Patient Monitoring sales rose 5% to $110.7 million driven by strong growth
of the Passport 2 portable bedside monitor and Accutorr(R) Plus noninvasive
blood pressure monitor. Also contributing to growth were increased sales of
Masimo pulse oximetry sensors and new Central Station Monitoring Systems,
which utilize recently introduced telemetry that operates across the full
range of FCC protected medical bands.

   Sales of the Collagen Products / Vascular Grafts segment increased 5% in
fiscal 2001 to $82.1 million.

 Collagen Products

   Sales of VasoSeal(R) arterial puncture sealing devices increased 3% to $57.8
million, which reflects a decline in U.S. market share, due to intensified
competition and slower than anticipated growth in productivity from our newly
expanded field sales organization. We expanded the field sales organization,
comprised of sales representatives and clinical specialists, by 35% in the
second half of fiscal 2001.

 Vascular Grafts

   InterVascular sales increased 10% to $23.3 million, reflecting continued
international demand for InterGard(R) Silver, the world's first anti-microbial
vascular graft, and a favorable comparison to the depressed prior year when
our U.S. distributor reduced inventory.

 Genisphere

   In fiscal 2001, Genisphere continued to successfully pursue its marketing
strategy, to target major academic institutions and the research and
development department of pharmaceutical and biotechnology companies, and
sales reached $1 million compared to $0.3 million last year. Investment
spending for the development of the Genisphere business was approximately $1
million in fiscal 2001.

   The stronger U.S. dollar compared to major European currencies decreased
consolidated sales by approximately $4.5 million in fiscal 2001 compared to
fiscal 2000.

Costs and Expenses

   The gross profit percentage was 60.0% for fiscal 2001 compared to 60.3% last
year, with the slight decrease primarily attributable to lower average selling
prices for certain patient monitoring products.

   Research and development (R&D) expenses remained unchanged at $24.4 million
in fiscal 2001 compared to fiscal 2000, with increased development expenses
for the VasoSeal and Cardiac Assist product lines being offset by lower
development expenses in the Patient Monitoring product line. As a percentage
of sales, R&D expenses were 7.8% in fiscal 2001 compared to 8.1% in fiscal
2000.

   Selling, general and administrative expenses (SG&A) increased 1% in fiscal
2001 compared to last year primarily as a result of higher selling and
marketing expenses for the Patient Monitoring and Cardiac Assist product lines
and the VasoSeal field organization expansion, partially offset by lower
corporate expenses. As a percentage of sales, SG&A expenses were 37.6% in
fiscal 2001 compared to 38.7% in fiscal 2000.

   The stronger U.S. dollar compared to major European currencies decreased
SG&A expenses by approximately $2.9 million in fiscal 2001 compared to fiscal
2000.



                                       20
<PAGE>

   Our 30% equity investment in the AMG stent business continued to be modestly
accretive in fiscal 2001. We have an option to purchase the remaining 70% of
AMG and its allied development and manufacturing company until January 30,
2002. In the second half of fiscal 2001, we initiated distribution of AMG's
proprietary coronary and peripheral stents primarily in France. Sales during
fiscal 2001 were not material.

Interest Income

   Interest income for fiscal 2001 of $3.7 million was unchanged compared to
fiscal 2000. The average investment portfolio decreased by $6.3 million which
was offset by an increase in the average yield to 6.0% from 5.5%.

Other Income

   During the first quarter of fiscal 2001, we recorded a pretax gain of $593
thousand, or $0.02 per share after tax, from the sale of an underutilized
facility in Oakland, New Jersey.

Income Taxes

   The consolidated effective tax rate was 30.9% for both fiscal 2001 and
fiscal 2000. The tax rate in both years was lower than the federal statutory
tax rate primarily as a result of:

   o the tax benefit from the Foreign Sales Corporation

   o income exempt from foreign corporate taxes (resulting from a tax
     exemption for an international manufacturing facility until January 31,
     2000, and the implementation of an alternative tax planning strategy in
     fiscal 2001)

   o interest income exempt from federal income taxes

   o net effect of research and development credits

Net Earnings

   Net earnings were $34.2 million or $2.20 per diluted share in fiscal 2001
compared to $33.1 million or $2.06 per diluted share last year. Excluding the
special items recorded in fiscal 2001 and fiscal 2000, net earnings were $33.9
million or $2.18 per diluted share compared to $30.6 million or $1.90 per
diluted share last year. The increased earnings in fiscal 2001 was
attributable to higher gross margin from increased sales and tight expense
control.

Foreign Currency

   Due to the global nature of our operations, we are subject to the exposures
that arise from foreign exchange rate fluctuations. Our objective in managing
our exposure to foreign currency fluctuations is to minimize net earnings
volatility associated with foreign exchange rate changes. We enter into
foreign currency forward exchange contracts to hedge foreign currency
transactions which are primarily related to certain receivables denominated in
foreign currencies. Our hedging activities do not subject us to exchange rate
risk because gains and losses on these contracts offset losses and gains on
the liabilities and transactions being hedged. A portion of the net foreign
transaction gain or loss is reported in our statement of consolidated earnings
in cost of sales and the balance in other income and expense. We do not use
derivative financial instruments for trading purposes.

   As of June 30, 2001, we had a notional amount of $7.4 million of foreign
exchange forward contracts outstanding, all of which were in European
currencies. The foreign exchange forward contracts generally have maturities
that do not exceed 12 months and require us to exchange foreign currencies for
U.S. dollars at maturity, at rates agreed to when the contract is signed.


                                       21
<PAGE>

Comparison of Results--Fiscal 2000 vs. Fiscal 1999

Sales

   Sales of the Cardiac Assist / Monitoring Products segment in fiscal 2000
increased 7% to $223.1 million.

 Cardiac Assist

   Sales of Cardiac Assist products increased 6% to $117.9 million in fiscal
2000 due to the contribution of newly introduced products: the Profile 8 Fr.
intra-aortic balloon catheter and the System 98 balloon pump. Worldwide market
acceptance of both of these products continued strong.

 Patient Monitoring

   Patient Monitoring product sales increased 10% to a record $105.2 million,
due primarily to shipments of the new Passport(R) 2, our next-generation
portable bedside monitor, which was introduced in international markets in the
second quarter. The market launch of the Passport 2 in the U.S. followed
receipt of 510(k) clearance from FDA in the third quarter and resulted in a
strong ramp up of shipments in the fourth quarter. Sales of the new
Accutorr(R) Plus blood pressure monitor continued to grow at a double digit
rate.

   Sales of the Collagen Products / Vascular Grafts segment increased 22% in
fiscal 2000 to $78.0 million.

 Collagen Products

   Sales of VasoSeal(R) arterial puncture sealing devices increased 32% to a
record $56.3 million from $42.8 million in fiscal 1999. The business continued
to benefit from solid market growth, higher average selling prices and
increased sales force productivity. VasoSeal ES, our second generation
product, which was introduced worldwide in the first quarter, continued to
grow strongly. During the fourth quarter, VasoSeal ES sales rose to about 30%
of worldwide VasoSeal sales. Sales of hemostats were not significant.

 Vascular Grafts

   International sales of InterVascular Inc., which account for over 85% of its
total sales, increased 13% due to continued strong demand for new products,
particularly the InterGard(R) Silver, the world's first anti-microbial
vascular graft. Total sales of InterVascular rose only 2% to $21.0 million as
our U.S. distributor reduced inventories, resulting in a sharp decline in
domestic sales.

 Genisphere (Life Science Research Products)

   Sales of Genisphere products in fiscal 2000 were $0.3 million. The
Genisphere business continued to implement its revised market entry strategy,
which was announced in fiscal 1999. Genisphere is now focusing on developing
3DNA-based products to improve the performance of newly-developing
technologies for drug discovery used by the pharmaceutical and biotech
industries. Investment spending for the development of the Genisphere business
was approximately $1 million in fiscal 2000.

   The stronger U.S. dollar compared to major European currencies decreased
consolidated sales by approximately $3.6 million in fiscal 2000 compared to
fiscal 1999.

Costs and Expenses

   The gross profit percentage was 60.3% for fiscal 2000 compared to 60.7% in
fiscal 1999, with the benefit of increased sales of higher margin products
being offset by lower average selling prices for certain patient monitoring
products.

   Research and development (R&D) expenses declined 14% in fiscal 2000 compared
to fiscal 1999 because of cost savings from the restructuring program
implemented in the second half of fiscal 1999 and lower development expenses
in the Patient Monitoring product line. As a percentage of sales, R&D expenses
were 8.1% in fiscal 2000 compared to 10.5% in fiscal 1999.



                                       22
<PAGE>

   Selling, general and administrative expenses (SG&A) increased 10% in fiscal
2000 compared to fiscal 1999 primarily as a result of the expansion of the
U.S. VasoSeal field force, increased selling and marketing expenses related to
higher sales, introduction of new products and higher corporate expenses. As a
percentage of sales, SG&A expenses were 38.7% in fiscal 2000 compared to 39.0%
in fiscal 1999.

   The stronger U.S. dollar compared to major European currencies decreased
SG&A expenses by approximately $2.3 million in fiscal 2000 compared to fiscal
1999.

Interest Income

   Interest income for fiscal 2000 of $3.7 million increased $0.3 million or 9%
compared to fiscal 1999. The increased interest income in fiscal 2000 was
attributable to a 6% increase in the average investment portfolio from $62.8
million to $66.4 million and an increase in the average yield to 5.5% from
5.2%.

Income Taxes

   The consolidated effective tax rate for fiscal 2000 was 30.9% compared to
28.1% for fiscal 1999. The tax rate in both years was lower than the federal
statutory tax rate primarily as a result of:

   o the tax benefit from the Foreign Sales Corporation

   o earnings in an international tax exempt industrial zone

   o interest income exempt from federal income tax

   The higher tax rate in fiscal 2000 compared to fiscal 1999 was due mainly to
the impact of higher earnings taxed at a higher statutory tax rate, expiration
of a tax exemption for a manufacturing subsidiary in Europe during fiscal 2000
and a lower R&D tax credit resulting from reduced R&D spending, partially
offset by the favorable impact from a higher state net operating loss
carryforward utilization.

   We operate a manufacturing subsidiary in an industrial development zone in
Europe. Profits from those manufacturing activities were exempt from
corporation taxes until January 31, 2000. Alternative tax planning strategies
have been implemented to reduce the impact of the expiration of this tax
exemption.

Net Earnings

   Net earnings were $33.1 million or $2.06 per diluted share in fiscal 2000
compared to $21.4 million, or $1.36 per diluted share in fiscal 1999. The
increase was attributable to:

   o sales growth

   o a more profitable product mix

   o cost savings from the restructuring program implemented in the second
     half of fiscal 1999

   o Special Items--fiscal 2000 gain on sale of technology of $2.5 million
     after tax, compared to a special charge of $2.2 million for restructuring
     in fiscal 1999

   Excluding the special items recorded in fiscal 2000 and fiscal 1999, net
earnings were $30.6 million or $1.90 per diluted share compared to $23.6
million, or $1.50 per diluted share in fiscal 1999.

Liquidity and Capital Resources

   Working capital at June 30, 2001 was $129.7 million compared to $120.3
million and the current ratio was 3.5:1 compared to 3.2:1 last year. Working
capital was impacted primarily by: 1) increased accounts receivable, as a
result of higher sales and an increase in days sales outstanding, and 2)
increased inventory to support new product introductions and for critical
patient monitoring and cardiac assist components.

   In fiscal 2001 cash provided by operations was $13.0 million, primarily
attributable to net earnings and depreciation and amortization, partially
offset by increased inventories and accounts receivable. Net cash provided by
investing activities was $8.9 million, primarily attributable to maturities of
marketable securities of $68.3 million, partially offset by purchases of
marketable securities of $49.8 million and the purchase of $10.7



                                       23
<PAGE>

million of property, plant and equipment. Net cash used in financing
activities was $19.8 million, attributable to stock repurchases of $21.8
million and $2.1 million dividends paid, partially offset by $4.0 million cash
received from exercise of stock options.

   Working capital at June 30, 2000 was $120.3 million compared to $125.3
million and the current ratio was 3.2:1 compared to 4.0:1 in fiscal 1999.
Working capital was impacted primarily by increases in accounts payable and
accrued compensation related to higher sales and earnings.

   In fiscal 2000 cash provided by operations was $49.4 million, attributable
to net earnings, depreciation and amortization and increased accounts payable
and accrued liabilities. Net cash used in investing activities was $30.2
million, attributable to the purchase of $28.4 million of property, plant and
equipment, primarily for the new Patient Monitoring and Collagen Products
facilities in Mahwah, New Jersey, and a $2.5 million equity investment in AMG,
and an allied company. Net cash used in financing activities was $20.7
million, attributable to stock repurchases of $24.2 million and $1.8 million
dividends paid, offset by $5.3 million cash received from exercise of stock
options.

   In fiscal 1999 cash provided by operations was $11.8 million, attributable
to net earnings and depreciation and amortization, partially offset by
increased accounts receivable and inventories. Net cash used in investing
activities was $0.1 million in fiscal 1999, attributable to the purchase of
$14.3 million of property, plant and equipment, including $7.2 million for the
new Patient Monitoring facility in Mahwah, New Jersey, and purchases of
marketable securities, offset by maturities of marketable securities. Cash
used in financing activities was $10.8 million in fiscal 1999, attributable to
stock repurchases of $13.0 million, partially offset by $2.2 million cash
received from exercise of stock options.

   We purchased about 564,000 of our common shares for approximately $21.8
million during fiscal year 2001. In May 2001, Datascope announced its fourth
share buyback program for $40 million.

   We believe that cash generated from operations and cash available under our
credit facilities will be sufficient to meet our projected cash requirements.

   The moderate rate of current U.S. inflation has not significantly affected
the Company.

Euro Conversion

   As part of the European Economic and Monetary Union (EMU), a single currency
(Euro) will replace the national currencies of most of the European countries
in which we conduct our business. The conversion rates between the Euro and
the participating nations' currencies have been fixed irrevocably as of
January 1, 1999. During a transition period from January 1, 1999 to December
31, 2001 parties may settle transactions using either Euro or the
participating country's national currency. The participating national
currencies will be removed from circulation between January 1, 2002 and June
30, 2002 and replaced by Euro notes and coinage. Full conversion of all
affected country operations to Euro is expected to be completed by the time
national currencies are removed from circulation.

   We are currently involved in the phased conversion to the Euro and the
effects on revenues, costs and various business strategies are not expected to
be material. We are able to conduct business in both the Euro and national
currencies on an as needed basis, as required by the European Union. The cost
of software and business process conversion is not expected to be material to
our financial condition or results of operations.

Statement Concerning Forward Looking Information

   This Management's Discussion and Analysis of Results of Operations and
Financial Condition contains forward-looking statements that involve risks and
uncertainties that could cause actual results to differ materially from those
projected in the forward-looking statements as a result of many important
factors. Many of these important factors cannot be predicted or quantified and
are outside of our control, including the possibility that market conditions
may change, particularly as the result of competitive activity in the Cardiac
Assist, Vascular Sealing and other markets served by us, our dependence on
certain suppliers for Patient Monitoring, Cardiac Assist and VasoSeal
products, and our ability to gain market acceptance for new products.
Additional risks are our ability to successfully introduce new products,
continued demand for our products generally, the rapid and



                                       24
<PAGE>

significant changes that characterize the medical device industry and the
ability to continue to respond to such changes, the uncertain timing of
regulatory approvals, changes in Medicare reimbursement for medical products
particularly VasoSeal, as well as other risks detailed in documents filed by
Datascope with the Securities and Exchange Commission.

Recent Accounting Pronouncements

   We adopted the Financial Accounting Standards Board Emerging Issues Task
Force Issue 00-10 ("EITF 00-10"), "Accounting for Shipping and Handling Fees
and Costs," in the fourth quarter of 2001. Application of this consensus
resulted in the reclassification of prior period financial results to reflect
shipping and handling fees as revenue and shipping and handling costs as cost
of sales. These amounts were previously recorded in selling, general and
administrative expense. The reclassifications had no effect on operating or
net income.

   Statement of Financial Accounting Standards No. 133, "Accounting for
Derivative Instruments and Hedging Activities" ("SFAS No. 133"), establishes
accounting and reporting standards for derivative instruments and for hedging
activities. It requires companies to recognize all derivatives as either
assets or liabilities in the statement of financial position and measure those
instruments at fair value. We adopted SFAS No. 133 in the first quarter of
fiscal 2001, in accordance with the deferral provision in SFAS No. 137. The
adoption of SFAS No. 133 did not have a material effect on our financial
statements.

   In December 1999, the Securities and Exchange Commission ("SEC") issued
Staff Accounting Bulletin No. 101 ("SAB 101"), "Revenue Recognition in
Financial Statements." SAB 101 summarizes certain of the SEC's views in
applying generally accepted accounting principles to revenue recognition in
financial statements. We adopted SAB 101 in the first quarter of fiscal 2001.
The adoption of SAB 101 did not have a significant impact on our financial
statements.

   In June 2001 the Financial Accounting Standards Board issued Statement of
Accounting Standards No. 142, "Accounting for Goodwill and Other Intangible
Assets," ("SFAS No. 142"). This statement provides guidance on how to account
for existing goodwill and intangible assets from completed acquisitions.
Goodwill and certain other intangible assets will no longer be amortized and
will be tested for impairment at least annually. SFAS No. 142 is effective for
fiscal periods beginning after December 15, 2001, with early adoption
permitted for companies with a fiscal year beginning after March 15, 2001, for
which quarterly financial statements have not been issued. We are currently
evaluating the impact of the adoption of the new standard.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

   Due to the global nature of our operations, we are subject to the exposures
that arise from foreign exchange rate fluctuations. Our objective in managing
our exposure to foreign currency fluctuations is to minimize net earnings
volatility associated with foreign exchange rate changes. We enter into
foreign currency forward exchange contracts to hedge foreign currency
transactions which are primarily related to certain intercompany receivables
denominated in foreign currencies. Our hedging activities do not subject us to
exchange rate risk because gains and losses on these contracts offset losses
and gains on the assets, liabilities and transactions being hedged. A portion
of the net foreign transaction gain or loss is reported in our statement of
consolidated earnings in cost of sales and the balance in other income and
expense. We do not use derivative financial instruments for trading purposes.

   As of June 30, 2001, we had a notional amount of $7.4 million of foreign
exchange forward contracts outstanding, all of which were in European
currencies. The foreign exchange forward contracts generally have maturities
that do not exceed 12 months and require us to exchange foreign currencies for
United States dollars at maturity, at rates agreed to when the contract is
signed.

Item 8. Financial Statements and Supplementary Data.

   See Financial Statements following Item 14 of this Annual Report on Form
10-K.

Item 9. Changes in and Disagreements With Accountants on Accounting and
Financial Disclosure.

   Not applicable.



                                       25
<PAGE>

                                    PART III

Item 10. Directors and Executive Officers of the Registrant.

   Except for the information included in Item 4A of this report, the
information required by this item is incorporated by reference from our
definitive proxy statement to be filed with the Securities and Exchange
Commission no later than October 26, 2001 pursuant to Regulations 14A of the
Securities Exchange Act of 1934.

Item 11. Executive Compensation.

   The information required by this item is incorporated by reference from our
definitive proxy statement to be filed with the Securities and Exchange
Commission no later than October 26, 2001 pursuant to Regulations 14A of the
Securities Exchange Act of 1934.

Item 12. Security Ownership of Certain Beneficial Owners and Management.

   The information required by this item is incorporated by reference from our
definitive proxy statement to be filed with the Securities and Exchange
Commission no later than October 26, 2001 pursuant to Regulations 14A of the
Securities Exchange Act of 1934.

Item 13. Certain Relationships and Related Transactions.

   The information required by this item is incorporated by reference from our
definitive proxy statement to be filed with the Securities and Exchange
Commission no later than October 26, 2001 pursuant to Regulations 14A of the
Securities Exchange Act of 1934.



                                       26
<PAGE>

                                      PART IV

Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K.

   (a) 1. Financial Statements

   Our consolidated financial statements are filed on the pages listed below,
as part of Part II, Item 8 of this report:


                                                                        Page
                                                                        ----
       Report of Independent Auditors.........................          F- 1
       Consolidated balance sheets--June 30, 2001 and 2000....          F- 2
       Statements of consolidated earnings--Years ended
         June 30, 2001, 2000 and 1999.........................          F- 3
       Statements of consolidated stockholders' equity--Years
         ended June 30, 2001, 2000 and 1999...................          F- 4
       Statements of consolidated cash flows--Years ended
         June 30, 2001, 2000 and 1999.........................          F- 5
       Notes to consolidated financial statements.............    F-6 - F-24
   2. Financial Statement Schedules
       Schedule II--Valuation and Qualifying Accounts.........           S-1


   All other schedules have been omitted because they are inapplicable, or not
required, or the information is included in the financial statements or
footnotes.

   3. Exhibits


Exhibit No.                   Document Description
-----------                   --------------------

 3.1   Restated Certificate of Incorporation as filed with the Secretary of
       State of the State of Delaware on October 30, 1989, incorporated by
       reference as Exhibit 3.1 to the registrant's Registration Statement on
       Form 8-B, filed with the Commission in January 1990 (the "Form 8-B").
 3.2   By-Laws, incorporated by reference to Exhibit 3.2 to the Company's Annual
       Report on
       Form 10-K for fiscal year ended June 30, 1993 (the "1993 10-K").
 4.1   Specimen of certificate of Common Stock, incorporated by reference to
       Exhibit 4.2 to the
       Form 8-B.
 4.2   Form of Certificate of Designations of the Company's Series A Preferred
       Stock, incorporated by reference to Exhibit 2.2 to the Company's
       Registration Statement on Form 8-A, filed with the Commission on May 31,
       1991 (the "Form 8-A").
 4.3   Form of Rights Agreement, dated as of May 22, 1991, between the Company
       and Continental Stock Transfer & Trust Company, incorporated by reference
       to Exhibit 2.1 to the Form 8-A.
 4.4   Form of Amendment to Rights Agreement, dated May 24, 2000, between the
       Company and Continental Stock Transfer & Trust Company, incorporated by
       reference to Exhibit 2 to the Form 8-A/A, filed with the Commission on
       June 1, 2000.
10.1   Datascope Corp. 1981 Incentive Stock Option Plan, incorporated by
       reference to Exhibit 10.2.1 to the Form 8-B.
10.2   Datascope Corp. 1995 Stock Option Plan, as amended, incorporated by
       reference to Exhibit 10.1 to Quarterly Report on Form 10-Q for the
       quarter ended December 31, 1997 (the "2Q 1997
       10-Q").
10.3   Datascope Corp. 1997 Executive Bonus Plan, incorporated by reference to
       Exhibit 10.2 to the 2Q 1997 10-Q.
10.4   Datascope Corp. Annual Incentive Plan, incorporated by reference to
       Exhibit 10.3 to the 2Q 1997 10-Q.
10.5   Datascope Corp. Compensation Plan for Non-Employee Directors,
       incorporated by reference to Exhibit 10.4 to the 2Q 1997 10-Q.
10.6   Employment Agreement, dated July 1, 1996, by and between the Company and
       Lawrence Saper, incorporated by reference to Exhibit 10.8 to the Annual
       Report on Form 10-K for the fiscal year ended June 30, 1997.


                                       27
<PAGE>

Exhibit No.                   Document Description
-----------                   --------------------

10.7   Split-Dollar Agreement, dated July 25, 1994, by and among the Company,
       Lawrence Saper and Carol Saper, Daniel Brodsky and Helen Nash, Trustees
       of the Saper Family 1994 Trust UTA. dtd. 6/28/94, incorporated by
       reference to Exhibit 10.15 to the Company's Annual Report on Form 10-K
       for fiscal year ended June 30, 1996 (the "1996 10-K").
10.8   Modification Agreement, dated July 25, 1994, by and among the Company,
       Lawrence Saper and Carol Saper, Daniel Brodsky and Helen Nash, Trustees
       of the Saper Family 1994 Trust UTA. dtd. 6/28/94, incorporated by
       reference to Exhibit 10.16 to the 1996 10-K.
10.9   Assignment, dated July 25, 1994, by Carol Saper, Daniel Brodsky and
       Helen Nash, Trustees of the Saper Family 1994 Trust UTA. dtd. 6/28/94 of
       Metropolitan Life Insurance Company Insurance Policy No. 940 750 122UM
       in favor of the Company, incorporated by reference to Exhibit 10.17 to
       the 1996 10-K.
10.10  Assignment made as of July 25, 1994 by Carol Saper, Daniel Brodsky and
       Helen Nash, Trustees of the Saper Family 1994 Trust UTA. dtd. 6/28/94 of
       Security Mutual Life Insurance Company of New York Insurance Policy No.
       11047711 in favor of Datascope Corp., incorporated by reference to
       Exhibit 10.18 to the 1996 10-K.
10.11  Stock Option Agreement between the Company and William E. Cohn,
       incorporated by reference to Exhibit 4.1 of the Registration Statement
       on Form S-8, filed with the Commission on June 20, 2000 (the "Form
       S-8").
10.12  Stock Option Agreement between the Company and Thor W. Nilsen,
       incorporated by reference to Exhibit 4.2 of the Form S-8.
10.13  Stock Option Agreement between the Company and Robert Getts, Ph.D.,
       incorporated by reference to Exhibit 4.3 of the Form S-8.
10.14  Stock Option Agreement between the Company and Arno Nash and Alan
       Abramson, incorporated by reference to Exhibit 4.5 of the Form S-8.
10.15  Stock Option Agreement between the Company and Gerald Zemel, M.D. and
       Charles Brown, M.D., incorporated by reference to Exhibit 4.6 of the
       Form S-8.
10.16  Stock Option Agreement between the Company and David Altschiller,
       incorporated by reference to Exhibit 4.7 of the Form S-8.
10.17  Amendment to Employment Agreement, dated as of May 30, 2000, by and
       between Datascope Corp. and Lawrence Saper, incorporated by reference as
       to Exhibit 10.22 of the Company's Annual Report on Form 10-K for fiscal
       year ended June 30, 2000.
21.1*  Subsidiaries of the Company.
23.1*  Consent of Deloitte & Touche LLP.

---------------
* Filed herewith.

    (b) Reports on Form 8-K.

    None.

    (c) Exhibits.

    See Item 14(a)(3) above.



                                       28
<PAGE>

                                   SIGNATURES

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

                                     DATASCOPE CORP.

Date: August 16, 2001                By: /s/ LAWRENCE SAPER
                                         ----------------------------

                                                 Lawrence Saper
                                             Chairman of the Board
                                          and Chief Executive Officer

   Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

<TABLE>
<CAPTION>
                 Signature                                         Capacity                                Date
                 ---------                                         --------                                ----
<S>                                           <C>                                                   <C>
            /s/ LAWRENCE SAPER                Chairman of the Board and Chief Executive Officer      August 16, 2001
  ----------------------------------------    (Principal Executive Officer)
               Lawrence Saper


          /s/ LEONARD S. GOODMAN              Vice President, Chief Financial Officer and            August 16, 2001
  ----------------------------------------    Treasurer (Principal Financial and Accounting
             Leonard S. Goodman               Officer)


             /s/ ALAN ABRAMSON                Director                                               August 16, 2001
  ----------------------------------------
               Alan Abramson


           /s/ DAVID ALTSCHILLER              Director                                               August 16, 2001
  ----------------------------------------
             David Altschiller


           /s/ WILLIAM ASMUNDSON              Director                                               August 16, 2001
  ----------------------------------------
             William Asmundson


         /s/ JOSEPH GRAYZEL, M.D.             Director                                                August 16, 2001
  ----------------------------------------
            Joseph Grayzel, M.D.


             /s/ GEORGE HELLER                Director                                               August 16, 2001
  ----------------------------------------
               George Heller


               /s/ ARNO NASH                  Director                                               August 16, 2001
  ----------------------------------------
                 Arno Nash
</TABLE>



                                       29
<PAGE>

                          INDEPENDENT AUDITORS' REPORT


To the Board of Directors and Stockholders of
Datascope Corp.
Montvale, New Jersey

   We have audited the accompanying consolidated balance sheets of Datascope
Corp. and its subsidiaries (the "Company") as of June 30, 2001 and 2000, and
the related consolidated statements of earnings, stockholders' equity and cash
flows for each of the three years in the period ended June 30, 2001. Our
audits also included the financial statement schedule listed in the index at
Item 14 (a) (2). These financial statements and the financial statement
schedule are the responsibility of the Company's management. Our
responsibility is to express an opinion on the consolidated financial
statements and the financial statement schedule based on our audits.

   We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

   In our opinion, such consolidated financial statements present fairly, in
all material respects, the financial position of Datascope Corp. and its
subsidiaries as of June 30, 2001 and 2000, and the results of their operations
and their cash flows for each of the three years in the period ended June 30,
2001 in conformity with accounting principles generally accepted in the United
States of America. Also, in our opinion, such financial statement schedule,
when considered in relation to the basic consolidated financial statements
taken as a whole, presents fairly, in all material respects, the information
set forth therein.



/s/ Deloitte & Touche LLP

New York, New York
July 20, 2001



                                      F-1
<PAGE>

                        DATASCOPE CORP. AND SUBSIDIARIES

                          CONSOLIDATED BALANCE SHEETS
                                 (In thousands)


                                                                June 30,
                                                           -------------------
                                                             2001       2000
                                                           --------   --------
                          ASSETS
Current Assets:
 Cash and cash equivalents ..............................  $  5,545   $  3,138
 Short-term investments .................................    32,669     53,096
 Accounts receivable less allowance for doubtful
   accounts of $1,350 and $1,644.........................    75,712     69,081
 Inventories ............................................    55,261     38,986
 Prepaid expenses and other current assets ..............    12,472      9,513
                                                           --------   --------
   Total Current Assets..................................   181,659    173,814
Property, Plant and Equipment, net ......................    90,634     86,243
Non-Current Marketable Securities .......................    14,134     12,235
Other Assets ............................................    23,908     23,034
                                                           --------   --------
                                                           $310,335   $295,326
                                                           ========   ========
           LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
 Accounts payable .......................................  $ 18,987   $ 14,726
 Accrued expenses .......................................    14,211     11,165
 Accrued compensation ...................................    14,248     20,222
 Deferred revenue .......................................     4,498      4,773
 Taxes on income ........................................         0      2,630
                                                           --------   --------
   Total Current Liabilities.............................    51,944     53,516
Other Liabilities .......................................    14,913     14,524
Stockholders' Equity
 Preferred stock, par value $1.00 per share:
   Authorized 5 million shares; Issued, none.............        --         --
 Common stock, par value $.01 per share:
   Authorized, 45 million shares; Issued and outstanding,
   17,508 and 17,028 shares .............................       175        170
 Additional paid-in capital .............................    69,148     60,145
 Treasury stock at cost, 2,713 and 2,149 shares .........   (77,038)   (55,247)
 Retained earnings ......................................   261,625    230,187
 Accumulated other comprehensive loss ...................   (10,432)    (7,969)
                                                           --------   --------
                                                            243,478    227,286
                                                           --------   --------
                                                           $310,335   $295,326
                                                           ========   ========



                 See notes to consolidated financial statements



                                      F-2
<PAGE>

                        DATASCOPE CORP. AND SUBSIDIARIES

                      STATEMENTS OF CONSOLIDATED EARNINGS
                    (In thousands, except per share amounts)


<TABLE>
<CAPTION>

                                                                                                          Year Ended June 30,
                                                                                                    -------------------------------
                                                                                                      2001        2000       1999
                                                                                                    --------    --------   --------
<S>                                                                                                 <C>         <C>        <C>
Net Sales.......................................................................................    $312,800    $301,400   $271,500
Costs and Expenses:
  Cost of sales.................................................................................     125,030     119,665    106,646
  Research and development expenses.............................................................      24,402      24,426     28,524
  Selling, general and administrative expenses..................................................     117,571     116,792    105,847
  Gain on sale of technology....................................................................          --      (3,825)        --
  Restructuring charges.........................................................................          --          --      3,429
                                                                                                    --------    --------   --------
                                                                                                     267,003     257,058    244,446
                                                                                                    --------    --------   --------
Operating Earnings..............................................................................      45,797      44,342     27,054
Other (Income) Expense:
  Interest income...............................................................................      (3,669)     (3,659)    (3,342)
  Interest expense..............................................................................          51          21         29
  Other, net....................................................................................        (176)        132        583
                                                                                                    --------    --------   --------
                                                                                                      (3,794)     (3,506)    (2,730)
                                                                                                    --------    --------   --------
Earnings Before Taxes on Income.................................................................      49,591      47,848     29,784
Taxes on Income.................................................................................      15,348      14,773      8,372
                                                                                                    --------    --------   --------
Net Earnings....................................................................................    $ 34,243    $ 33,075   $ 21,412
                                                                                                    ========    ========   ========
Earnings Per Share, Basic.......................................................................    $   2.30    $   2.18   $   1.40
                                                                                                    ========    ========   ========
Weighted Average Number of Common Shares Outstanding, Basic.....................................      14,904      15,169     15,247
                                                                                                    ========    ========   ========
Earnings Per Share, Diluted.....................................................................    $   2.20    $   2.06   $   1.36
                                                                                                    ========    ========   ========
Weighted Average Number of Common Shares Outstanding, Diluted...................................      15,547      16,080     15,721
                                                                                                    ========    ========   ========
</TABLE>



                 See notes to consolidated financial statements



                                      F-3
<PAGE>

                        DATASCOPE CORP. AND SUBSIDIARIES

                STATEMENTS OF CONSOLIDATED STOCKHOLDERS' EQUITY
                       (Shares and dollars in thousands)


<TABLE>
<CAPTION>

                                            Common Stock                    Treasury Stock                  Accumulated
                                           --------------   Additional    -----------------                    Other
                                                     Par      Paid-in                          Retained    Comprehensive
                                          Shares    Value     Capital     Shares     Cost      Earnings        Loss          Total
                                          ------    -----   ----------    ------   --------    --------    -------------   --------
<S>                                       <C>       <C>     <C>           <C>      <C>         <C>         <C>             <C>
Balance, June 30, 1998 ................   16,394    $164      $46,965       (793)  ($18,122)   $177,509       ($5,110)     $201,406
Net earnings ..........................                                                          21,412                      21,412
Currency translation ..................                                                                        (1,014)       (1,014)
                                                                                                                           --------
Total comprehensive income ............                                                                                      20,398
                                                                                                                           --------
Stock option transactions .............      144       2        2,831                  (649)                                  2,184
Issuance of common stock for
  acquisition of Polyprobe, Inc. and
  Alpha Probe, Inc.....................      125       1        2,699                                                         2,700
Tax benefit relating to exercise of
  stock options........................                           564                                                           564
Cancellation of treasury stock ........                          (649)                  649                                      --
Treasury shares acquired under
  repurchase programs..................                                     (623)   (12,957)                                (12,957)
                                          ------    ----      -------     ------   --------    --------      --------      --------
Balance, June 30, 1999 ................   16,663     167       52,410     (1,416)   (31,079)    198,921        (6,124)      214,295
Net earnings ..........................                                                          33,075                      33,075
Currency translation ..................                                                                        (1,845)       (1,845)
                                                                                                                           --------
Total comprehensive income ............                                                                                      31,230
                                                                                                                           --------
Stock option transactions .............      365       4        7,740                (2,450)                                  5,294
Tax benefit relating to exercise of
  stock options........................                         2,444                                                         2,444
Cancellation of treasury stock ........               (1)      (2,449)                2,450                                      --
Treasury shares acquired under
  repurchase programs..................                                     (733)   (24,168)                                (24,168)
Cash dividends on common stock ........                                                          (1,809)                     (1,809)
                                          ------    ----      -------     ------   --------    --------      --------      --------
Balance, June 30, 2000 ................   17,028     170       60,145     (2,149)   (55,247)    230,187        (7,969)      227,286
Net earnings ..........................                                                          34,243                      34,243
Currency translation ..................                                                                        (2,463)       (2,463)
                                                                                                                           --------
Total comprehensive income ............                                                                                      31,780
                                                                                                                           --------
Stock option transactions .............      480       7       12,794                (8,788)                                  4,013
Tax benefit relating to exercise of
  stock options........................                         4,995                                                         4,995
Cancellation of treasury stock ........               (2)      (8,786)                8,788                                      --
Treasury shares acquired under
  repurchase programs..................                                     (564)   (21,791)                                (21,791)
Cash dividends on common stock ........                                                          (2,805)                     (2,805)
                                          ------    ----      -------     ------   --------    --------      --------      --------
Balance, June 30, 2001 ................   17,508    $175      $69,148     (2,713)  ($77,038)   $261,625      ($10,432)     $243,478
                                          ======    ====      =======     ======   ========    ========      ========      ========
</TABLE>


                 See notes to consolidated financial statements



                                      F-4
<PAGE>

                        DATASCOPE CORP. AND SUBSIDIARIES

                     STATEMENTS OF CONSOLIDATED CASH FLOWS
                             (Dollars in thousands)


<TABLE>
<CAPTION>

                                                                                                          Year Ended June 30,
                                                                                                    -------------------------------
                                                                                                      2001        2000       1999
                                                                                                    --------    --------   --------
<S>                                                                                                 <C>         <C>        <C>
Operating Activities:
  Net Earnings..................................................................................    $ 34,243    $ 33,075   $ 21,412
  Adjustments to reconcile net earnings to net cash provided by operating activities:
   Depreciation and amortization................................................................      13,982      12,931     12,095
   Provision for supplemental pension...........................................................         514         405        165
   Provision for losses on accounts receivable..................................................          34         567        357
   Gain on sale of Oakland facility.............................................................        (593)         --         --
   Deferred income tax (benefit)................................................................       3,240        (433)      (807)
   Tax benefit relating to stock options exercised..............................................       4,995       2,444        564
  Changes in assets and liabilities net of effects of equity
   investment in AMG and acquisition of Polyprobe, Inc.
   and Alpha Probe, Inc.
   Accounts receivable..........................................................................      (8,112)     (6,228)    (9,920)
   Inventories..................................................................................     (25,041)     (4,073)   (13,114)
   Other assets.................................................................................      (8,839)     (2,407)    (2,520)
   Accounts payable.............................................................................       4,409       4,266     (3,742)
   Income taxes payable.........................................................................      (2,630)        934      1,695
   Accrued and other liabilities................................................................      (3,222)      7,890      5,617
                                                                                                    --------    --------   --------
  Net cash provided by operating activities.....................................................      12,980      49,371     11,802
                                                                                                    --------    --------   --------
Investing Activities:
  Purchases of property, plant and equipment....................................................     (10,708)    (28,355)   (14,281)
  Proceeds from sale of Oakland facility........................................................       1,112          --         --
  Purchases of marketable securities............................................................     (49,775)    (94,641)   (50,959)
  Maturities of marketable securities...........................................................      68,304      95,343     65,611
  Equity investment in AMG......................................................................          --      (2,525)        --
  Acquisition of Polyprobe, Inc. and Alpha Probe, Inc...........................................          --          --       (450)
                                                                                                    --------    --------   --------
  Net cash provided by (used in) investing activities...........................................       8,933     (30,178)       (79)
                                                                                                    --------    --------   --------
Financing Activities:
  Exercise of stock options.....................................................................       4,013       5,294      2,184
  Treasury shares acquired under repurchase programs............................................     (21,791)    (24,168)   (12,957)
  Cash dividends paid...........................................................................      (2,066)     (1,809)        --
                                                                                                    --------    --------   --------
  Net cash used in financing activities.........................................................     (19,844)    (20,683)   (10,773)
                                                                                                    --------    --------   --------
  Effect of exchange rates on cash..............................................................         338         (63)       177
                                                                                                    --------    --------   --------
Increase (decrease) in cash and cash equivalents................................................       2,407      (1,553)     1,127
Cash and cash equivalents, beginning of year....................................................       3,138       4,691      3,564
                                                                                                    --------    --------   --------
Cash and cash equivalents, end of year..........................................................    $  5,545    $  3,138   $  4,691
                                                                                                    ========    ========   ========
Supplemental Cash Flow Information
  Cash paid during the year for:
   Interest.....................................................................................    $     51    $     21   $     29
                                                                                                    --------    --------   --------
   Income taxes.................................................................................    $ 12,334    $ 11,928   $  7,007
                                                                                                    --------    --------   --------
Non-cash transactions:
  Net transfers of inventory to fixed assets for use as demonstration equipment.................    $  7,836    $  6,962   $  8,315
                                                                                                    --------    --------   --------
  Issuance of common stock for acquisition of Polyprobe, Inc. and Alpha Probe, Inc..............    $     --    $     --   $  2,700
                                                                                                    --------    --------   --------
</TABLE>



                 See notes to consolidated financial statements



                                      F-5
<PAGE>

                       DATASCOPE CORP. AND SUBSIDIARIES.

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                 (Dollars in thousands, except per share data)

1.  Summary of Significant Accounting Policies

 Principles of Consolidation
   The consolidated financial statements include the accounts of Datascope
Corp. and its subsidiaries (the "Company"--which may be referred to as our, us
or we). All material intercompany balances and transactions have been
eliminated.

 Cash and Cash Equivalents
   Cash and cash equivalents consist primarily of highly liquid investments
which have original maturities less than 90 days.

 Inventories
   Inventories are stated at the lower of cost, determined on a first-in,
first-out basis, or market.

 Property, Plant and Equipment
   Property, plant and equipment are stated at cost less accumulated
depreciation and amortization. Additions and improvements are capitalized,
while maintenance and repairs are expensed as incurred. Asset and accumulated
depreciation accounts are relieved for dispositions, with resulting gains or
losses reflected in earnings. Depreciation of plant and equipment is provided
using the straight-line method over the estimated useful lives of the various
assets, or for leasehold improvements, over the term of the lease, if shorter.

 Foreign Currency Translation
   Assets and liabilities of foreign subsidiaries have been translated at year-
end exchange rates, while revenues and expenses have been translated at
average exchange rates in effect during the year. Resulting cumulative
translation adjustments have been recorded as a separate component of
stockholders' equity.

 Taxes on Income
   Deferred tax assets and liabilities are determined based on differences
between financial reporting and tax bases of assets and liabilities and are
measured using the enacted tax rates in effect for the years in which the
differences are expected to reverse.

 Revenue Recognition
   We recognize revenue and all related costs, including warranty, when product
is shipped and title passes to the customer. For certain products where we
maintain consigned inventory at customer locations, revenue is recognized at
the time we are notified that the product has been used by the customer.
Revenue for service contracts is recognized ratably over the term of the
contract.

   The Company adopted the Financial Accounting Standards Board Emerging Issues
Task Force Issue 00-10 ("EITF 00-10"), "Accounting for Shipping and Handling
Fees and Costs," in the fourth quarter of 2001. Application of this consensus
resulted in the reclassification of prior period financial results to reflect
shipping and handling fees as revenue and shipping and handling costs as cost
of sales. These amounts were previously recorded in selling, general and
administrative expense. The reclassifications had no effect on operating or
net income.

   In December 1999, the Securities and Exchange Commission ("SEC") issued
Staff Accounting Bulletin No. 101 ("SAB 101"), "Revenue Recognition in
Financial Statements." SAB 101 summarizes certain of the SEC's views in
applying generally accepted accounting principles to revenue recognition in
financial statements. We adopted SAB 101 in the first quarter of fiscal 2001.
The adoption of SAB 101 did not have a significant impact on our financial
statements.

                                      F-6
<PAGE>

                       DATASCOPE CORP. AND SUBSIDIARIES.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                 (Dollars in thousands, except per share data)


1.  Summary of Significant Accounting Policies--(Continued)

 Earnings Per Share
   In accordance with Statement of Financial Accounting Standards No. 128,
"Earnings per Share," we report basic earnings per share, which is based upon
weighted average common shares outstanding, and diluted earnings per share
which includes the dilutive effect of stock options outstanding.

 Impairment of Long Lived Assets
   The recoverability of the excess of cost over fair value of net assets
acquired is evaluated by an analysis of operating results and consideration of
other significant events or changes in the business environment. If we believe
an impairment exists, the carrying amount of these assets is reduced to fair
value as defined in Statement of Financial Accounting Standards No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets
to be Disposed Of."

 Other Assets
   a. Goodwill--Goodwill represents the excess of cost over the fair value of
      net assets acquired and is amortized using the straight-line method over
      periods not exceeding 20 years.

      In June 2001 the Financial Accounting Standards Board issued Statement
      of Accounting Standards No. 142, "Accounting for Goodwill and Other
      Intangible Assets," ("SFAS No. 142"). This statement provides guidance
      on how to account for existing goodwill and intangible assets from
      completed acquisitions. Goodwill and certain other intangible assets
      will no longer be amortized and will be tested for impairment at least
      annually. SFAS No. 142 is effective for fiscal periods beginning after
      December 15, 2001, with early adoption permitted for companies with a
      fiscal year beginning after March 15, 2001, for which quarterly
      financial statements have not been issued. We are currently evaluating
      the impact of the adoption of the new standard.

   b. Capitalized Software Development--In accordance with Statement of
      Financial Accounting Standards No. 86, "Accounting for the Costs of
      Computer Software to be Sold, Leased, or Otherwise Marketed," costs
      incurred in the research and development of new software products and
      enhancements to existing software products are expensed as incurred
      until technological feasibility has been established. After
      technological feasibility is established, any additional software
      development costs are capitalized and included in Other Assets. Software
      development costs are amortized using the straight-line method over the
      remaining estimated economic life of the product, not to exceed 5 years.

   c. Internal Use Capitalized Computer Software Costs--The Company
      capitalizes costs incurred to develop internal use computer software
      during the application development stage, in accordance with the AICPA
      Statement of Position 98-1, "Accounting for the Costs of Computer
      Software Developed or Obtained for Internal Use." Internal use computer
      software costs are amortized on a straight line basis over the remaining
      estimated economic life of the software.

   Amortization of capitalized software costs was $857 thousand in fiscal 2001,
$428 thousand in fiscal 2000 and $51 thousand in fiscal 1999.

   The carrying value of capitalized software costs is regularly reviewed by
the Company, and a loss would be recognized if the net realizable value falls
below the unamortized cost.

 Use of Estimates
   The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the


                                      F-7
<PAGE>

                       DATASCOPE CORP. AND SUBSIDIARIES.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                 (Dollars in thousands, except per share data)


1.  Summary of Significant Accounting Policies--(Continued)


reported amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates.

 Reclassifications
   The presentation of certain prior year information has been reclassified to
conform with the current year presentation.

2.  Financial Instruments
   The fair value of accounts receivable and payable are assumed to equal their
carrying value because of their short maturity.

   Fair values of short-term investments are based upon quoted market prices,
including accrued interest, and approximate their carrying values due to their
short maturities. Fair values of non-current marketable securities are also
based upon quoted market prices and include accrued interest.

   We determined that our investment portfolio will be held-to-maturity and is
therefore carried at amortized cost.

   As of June 30, 2001, marketable securities were classified as follows:

<TABLE>
<CAPTION>


                                                                                                            Gross
                                                                                                         Unrealized
Short Term                                                                                Amortized     --------------
----------                                                                                   Cost      Gains    Losses   Fair Value
                                                                                          ---------    -----    ------   ----------
<S>                                                                                       <C>          <C>      <C>      <C>
U.S. Treasury Securities ..............................................................    $28,471      $ 79     $ 57      $28,493
Tax-Exempt Securities .................................................................      4,198        33       --        4,231
                                                                                           -------      ----     ----      -------
 Short-term total .....................................................................    $32,669      $112     $ 57      $32,724
                                                                                           =======      ====     ====      =======
Long Term
  ---------
U.S. Treasury Securities ..............................................................    $11,800      $143     $140      $11,803
AAA--Rated Corporate Notes ............................................................      1,326        --       12        1,314
Tax-Exempt Securities .................................................................      1,008        20       --        1,028
                                                                                           -------      ----     ----      -------
 Long-term total ......................................................................    $14,134      $163     $152      $14,145
                                                                                           =======      ====     ====      =======
 Totals ...............................................................................    $46,803      $275     $209      $46,869
                                                                                           =======      ====     ====      =======
</TABLE>


   As of June 30, 2000, marketable securities were classified as follows:

<TABLE>
<CAPTION>

                                                                                                            Gross
                                                                                                         Unrealized
Short Term                                                                                Amortized     --------------
----------                                                                                   Cost      Gains    Losses   Fair Value
                                                                                          ---------    -----    ------   ----------
<S>                                                                                       <C>          <C>      <C>      <C>
 U.S. Treasury Securities .............................................................    $49,653      $12      $112      $49,553
 Tax-Exempt Securities ................................................................      3,443       --         1        3,442
                                                                                           -------      ---      ----      -------
 Short-term total .....................................................................    $53,096      $12      $113      $52,995
                                                                                           =======      ===      ====      =======
Long Term
  ---------
 U.S. Treasury Securities .............................................................    $ 8,098      $--      $ 28      $ 8,070
 Tax-Exempt Securities ................................................................      4,137        3         7        4,133
                                                                                           -------      ---      ----      -------
 Long-term total ......................................................................    $12,235      $ 3      $ 35      $12,203
                                                                                           =======      ===      ====      =======
 Totals ...............................................................................    $65,331      $15      $148      $65,198
                                                                                           =======      ===      ====      =======
</TABLE>

                                      F-8
<PAGE>

                       DATASCOPE CORP. AND SUBSIDIARIES.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                 (Dollars in thousands, except per share data)


2.  Financial Instruments--(Continued)


   We invest our excess cash primarily in U.S. Treasury and tax-exempt
securities. Since we hold all short- and long-term securities until maturity,
such investments are subject to little market risk. We have not incurred
losses related to these investments.

 Derivative Financial Instruments

   We have limited involvement with derivative financial instruments and do not
use them for trading purposes. We utilize foreign currency forward exchange
contracts to mitigate the foreign exchange impact of transaction gains or
losses relating to intercompany receivables. Changes in the fair value of the
derivative financial instruments are recorded in the statement of earnings.

   As of June 30, 2001, we had a notional amount of $7.4 million of foreign
exchange forward contracts outstanding, all of which were in European
currencies. The foreign exchange forward contracts generally have maturities
that do not exceed 12 months and require that we exchange foreign currencies
for U.S. dollars at maturity, at rates agreed to at inception of the
contracts. The foreign currency forward exchange contracts are with large
international financial institutions.

   Statement of Financial Accounting Standards No. 133, "Accounting for
Derivative Instruments and Hedging Activities" ("SFAS No. 133"), establishes
accounting and reporting standards for derivative instruments and for hedging
activities. It requires companies to recognize all derivatives as either
assets or liabilities in the statement of financial position and measure those
instruments at fair value. We adopted SFAS No. 133 as of July 1, 2000, in
accordance with the deferral provision in SFAS No. 137. The adoption of SFAS
No. 133 did not have a material effect on our financial statements.

 Concentration of Credit Risk

   Concentrations of credit risk with respect to trade receivables are limited
due to the large number of customers comprising our customer base. Ongoing
credit evaluations of customers' financial condition are performed. We
maintain reserves for potential credit losses and these losses have not
exceeded our expectations.

3.  Inventories


                                                             June 30,
                                                         -----------------
                                                          2001       2000
                                                         -------   -------
    Materials .......................................    $24,550   $17,462
    Work in process .................................     10,185     7,888
    Finished goods ..................................     20,526    13,636
                                                         -------   -------
                                                         $55,261   $38,986
                                                         =======   =======


                                      F-9
<PAGE>
                        DATASCOPE CORP. AND SUBSIDIARIES
`
            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                 (Dollars in thousands, except per share data)


4.  Property, Plant and Equipment


                                                                  June 30,
                                                             -------------------
                                                               2001       2000
                                                             --------   --------
    Land ................................................    $ 10,643   $ 11,000
    Buildings ...........................................      47,764     29,378
    Machinery, furniture and equipment ..................      83,116     83,602
    Leasehold improvements ..............................       1,533      3,910
    Construction in progress ............................          --     16,587
                                                             --------   --------
                                                              143,056    144,477
    Less accumulated depreciation and amortization ......      52,422     58,234
                                                             --------   --------
                                                             $ 90,634   $ 86,243
                                                             ========   ========


   Depreciation expense was $12.4 million in 2001, $11.9 million in 2000 and
$11.6 million in 1999. We estimate the useful life of machinery and equipment
at 5 years, furniture at 8 years and buildings at 40 years.

   Costs incurred for the new Patient Monitoring and Collagen Products
facilities in Mahwah, New Jersey were $3.9 million in 2001 and $23.1 million
in 2000. The Collagen Products facility was placed in service in the first
quarter of fiscal 2001 and the Patient Monitoring facility was placed in
service in the second quarter of fiscal 2001.

5.  Other Assets
   Other Assets at June 30, 2001 and 2000 were comprised of the following:

                                                                   June 30,
                                                               -----------------
                                                                2001       2000
                                                               -------   -------
    Cash surrender value of officers' life insurance ......    $ 8,920   $ 8,030
    Capitalized software, net of accumulated amortization .      7,375     5,855
    Goodwill, net of accumulated amortization .............      6,023     6,739
    Other non-current assets ..............................      1,590     2,410
                                                               -------   -------
                                                               $23,908   $23,034
                                                               =======   =======

   During the third quarter fiscal 2000 we purchased a 30% equity interest in
AMG GmbH, a private German distributor of proprietary stent products, and in
an allied development and manufacturing company. The cost of the investment
was $2.5 million, including $0.3 million of related expenses, and was paid in
cash. Goodwill of $2.2 million related to the equity investment is being
amortized over 15 years.

   During fiscal 1999 we acquired Polyprobe, Inc. and Alpha Probe, Inc. for
$3.2 million. The acquisitions were accounted for using the purchase method of
accounting and were paid for by issuing 125,141 shares of our common stock
plus $450 thousand in cash. Goodwill of $3.1 million related to these
purchases is being amortized over 10 years.



                                      F-10
<PAGE>


                       DATASCOPE CORP. AND SUBSIDIARIES.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                 (Dollars in thousands, except per share data)


6.  Taxes on Income


   The provision for taxes on income consisted of the following:

<TABLE>
<CAPTION>
                                                                              Year Ended June 30,
                                                                          ---------------------------
                                                                           2001       2000      1999
                                                                          -------   -------    ------
    <S>                                                                   <C>       <C>        <C>
    Taxes currently payable:
      Federal.........................................................    $ 9,803   $12,479    $7,404
      State...........................................................        754     1,177     1,139
      Foreign.........................................................      1,551     1,891       719
                                                                          -------   -------    ------
       Total current..................................................     12,108    15,547     9,262
    Deferred income taxes:
      Federal.........................................................      2,861      (580)     (801)
      State...........................................................        566      (194)      (89)
      Foreign.........................................................       (187)       --        --
                                                                          -------   -------    ------
       Total deferred.................................................      3,240      (774)     (890)
                                                                          -------   -------    ------
        Total provision for taxes on income...........................    $15,348   $14,773    $8,372
                                                                          =======   =======    ======
</TABLE>


   Amounts are reflected in the preceding table based on the location of the
taxing authorities. As of June 30, 2001 we have not made a U.S. tax provision
for the unremitted earnings of our international subsidiaries. These earnings,
which approximated $48.3 million as of June 30, 2001 are expected, for the
most part, to be permanently reinvested outside of the United States.

   We operate a manufacturing subsidiary in an industrial development zone in
Europe. Profits from those manufacturing activities were exempt from
corporation taxes until January 31, 2000. Alternative tax planning strategies
have been implemented to reduce the impact from the expiration of this tax
exemption.

   Reconciliations of the U.S. statutory income tax rate to our effective tax
rate follow:

<TABLE>
<CAPTION>

                                                                                         Year Ended June 30,
                                                                  -----------------------------------------------------------------
                                                                         2001                   2000                   1999
                                                                  -------------------    -------------------    -------------------
                                                                            Effective              Effective              Effective
                                                                  Amount      Rate       Amount       Rate      Amount       Rate
                                                                 -------    ---------   -------    ---------    -------   ---------
<S>                                                              <C>        <C>         <C>        <C>          <C>       <C>
Tax computed at federal statutory rate .......................   $17,357      35.0%     $16,747       35.0%     $10,425      35.0%
(Decrease) increase resulting from:
 Benefit attributable to foreign sales corp. .................    (1,066)     (2.2)      (1,075)      (2.2)        (956)     (3.2)
 State taxes on income, net of
   federal income tax benefit.................................       858       1.7          639        1.3          683       2.3
 Research and development credit, net ........................      (206)     (0.4)        (278)      (0.6)        (325)     (1.1)
 Income exempt from foreign
   corporate taxes............................................    (1,893)     (3.8)      (1,119)      (2.3)      (1,369)     (4.6)
 Rate differential on foreign income .........................      (236)     (0.5)         124        0.3          (31)     (0.2)
 Interest income exempt from
   federal income tax.........................................      (123)     (0.2)        (233)      (0.5)        (282)     (0.9)
 Permanent differences .......................................       204       0.4          235        0.5          159       0.6
 Other .......................................................       453       0.9         (267)      (0.6)          68       0.2
                                                                 -------      ----      -------       ----      -------      ----
 Total provision for taxes on income .........................   $15,348      30.9%     $14,773       30.9%     $ 8,372      28.1%
                                                                 =======      ====      =======       ====      =======      ====
</TABLE>



                                      F-11
<PAGE>

                       DATASCOPE CORP. AND SUBSIDIARIES.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                 (Dollars in thousands, except per share data)


6.  Taxes on Income--(Continued)


   Deferred taxes arise because of different treatment between financial
statement accounting and tax accounting, known as "temporary differences." We
record the tax effect of these temporary differences as "deferred tax assets"
(generally items that can be used as a tax deduction or credit in future
periods) and "deferred tax liabilities" (generally items that we receive a tax
deduction for, but have not yet been recorded in the statement of consolidated
earnings).

   The tax effects of the major items recorded as deferred tax assets and
liabilities are:

<TABLE>
<CAPTION>
                                                                 June 30,
                                                       -----------------------------
                                                           2001             2000
                                                       -------------   -------------
                                                       Deferred Tax     Deferred Tax
                                                          Assets           Assets
                                                       (Liabilities)   (Liabilities)
                                                       -------------   -------------
    <S>                                                <C>             <C>
    Inventories ...................................       $ 2,833         $ 3,284
    Warranty ......................................           987           1,250
    Sales returns & allowances ....................           (32)            113
    Accrued expenses ..............................           (34)            597
    Foreign & state tax credits ...................         1,106             911
    Unrealized foreign exchange losses ............           369             263
    Deferred state income taxes ...................          (921)           (675)
                                                          -------         -------
      Current......................................         4,308           5,743
                                                          -------         -------
    Supplemental pension ..........................         4,746           4,555
    Tax loss carryforwards ........................         1,563           1,459
    Accelerated depreciation ......................        (5,693)         (4,134)
    Accrued pension expense .......................            56             (27)
    Asset writedowns ..............................           397             611
    Other, net ....................................           292             598
    Less: Valuation allowance .....................        (1,563)         (1,459)
                                                          -------         -------
      Non-current..................................          (202)          1,603
                                                          -------         -------
       Total.......................................       $ 4,106         $ 7,346
                                                          =======         =======
</TABLE>


   The net current deferred tax assets have been included in prepaid expenses
and other current assets and the net non-current deferred tax (liabilities)
assets have been included in other liabilities and other assets, respectively,
on the accompanying consolidated balance sheets.

   A valuation allowance is recorded because some items recorded as deferred
tax assets may not be realizable. The valuation allowance reduces the deferred
tax assets to our best estimate of net deferred assets which more likely than
not will be realized.

   The valuation allowance increased by $104 thousand during fiscal 2001 due to
the net increase of foreign and state tax loss carryforwards. The valuation
allowance of $1.56 million at June 30, 2001 was comprised of tax benefits of
$463 thousand of foreign tax loss carryforwards and $1.10 million of state tax
loss carryforwards. Benefits from foreign tax loss carryforwards of $63
thousand expire in 2008 and $400 thousand may be carried forward indefinitely.
The benefits of state tax loss carryforwards expire during the period 2003
through 2019.



                                      F-12
<PAGE>

                       DATASCOPE CORP. AND SUBSIDIARIES.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                 (Dollars in thousands, except per share data)


7.  Other Liabilities

   Other Liabilities at June 30, 2001 and 2000 were comprised of the following:

                                                            June 30,
                                                        -----------------
                                                         2001       2000
                                                        -------   -------
    Supplemental pension payable ...................    $11,767   $11,289
    Non-current deferred income ....................      1,783     1,700
    Other non-current liabilities ..................      1,363     1,535
                                                        -------   -------
                                                        $14,913   $14,524
                                                        =======   =======


8.  Stock Options, Shareholder Rights and Stock Repurchase Plans

 Stock Option Plans

   We have two employee stock option plans covering 5,825,000 shares of common
stock as well as option agreements with certain consultants and members of the
board of directors. The plans provide that options may be granted at a price
of 100% of fair market value on date of grant, may be exercised in full or in
installments, at the discretion of the board of directors, and must be
exercised within ten years from date of grant.

   A summary of activity under the stock option plans is as follows:

<TABLE>
<CAPTION>

                                                                                       Year Ended June 30,
                                                               --------------------------------------------------------------------
                                                                       2001                    2000                    1999
                                                               --------------------    --------------------    --------------------
                                                                           Weighted                Weighted                Weighted
                                                                           Average                  Average                 Average
                                                                           Exercise                Exercise                Exercise
                                                                Shares      Price       Shares       Price      Shares       Price
                                                              ---------    --------   ---------    --------    ---------   --------
<S>                                                           <C>          <C>        <C>          <C>         <C>         <C>
Outstanding at July 1 .....................................   2,244,237     $23.92    2,313,756     $20.33     2,156,670    $18.72
 Granted ..................................................     625,900      37.62      444,100      36.85       521,775     26.03
 Exercised ................................................    (703,571)     18.11     (427,334)     17.68      (168,478)    16.44
 Canceled .................................................    (166,761)     28.54      (86,285)     25.17      (196,211)    21.19
                                                              ---------               ---------                ---------
Outstanding at June 30 ....................................   1,999,805      29.86    2,244,237      23.92     2,313,756     20.33
                                                              =========               =========                =========
Exercisable at June 30 ....................................     848,611     $23.91    1,278,007     $19.81     1,341,617    $17.76
                                                              ---------               ---------                ---------
</TABLE>


   At June 30, 2001 there were 2,461,299 shares of common stock reserved for
stock options.

   We adopted Statement of Financial Accounting Standards No. 123, "Accounting
for Stock-Based Compensation," ("SFAS No. 123") in fiscal 1997. We continue to
account for our employee stock-based awards using the intrinsic value method
in accordance with APB Opinion No. 25 "Accounting for Stock Issued to
Employees." Under APB Opinion No. 25, because the exercise price of our
employee stock options equals the market price of the underlying stock on the
date of grant, no compensation expense is recognized.

   In accordance with SFAS No. 123 the fair value of option grants is estimated
on the date of grant using an option-pricing model. Had the fair value method
of accounting been applied to our stock option plans, pro forma net income and
earnings per share would have been reported as the following pro forma
amounts:


                                      F-13
<PAGE>

                       DATASCOPE CORP. AND SUBSIDIARIES.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                 (Dollars in thousands, except per share data)

8.  Stock Options, Shareholder Rights and Stock Repurchase Plans--(Continued)

<TABLE>
<CAPTION>
                                                                          Year Ended June 30,
                                                                      ----------------------------
                                                                       2001       2000      1999
                                                                      -------   -------    -------
    <S>                                                               <C>       <C>        <C>
    Net earnings--as reported.....................................    $34,243   $33,075    $21,412
                                                                      -------   -------    -------
    Net earnings--pro forma.......................................    $31,033   $30,258    $19,168
                                                                      -------   -------    -------
    Basic earnings per share--as reported.........................    $  2.30   $  2.18    $  1.40
                                                                      -------   -------    -------
    Basic earnings per share--pro forma...........................    $  2.08   $  1.99    $  1.26
                                                                      -------   -------    -------
    Diluted earnings per share--as reported.......................    $  2.20   $  2.06    $  1.36
                                                                      -------   -------    -------
    Diluted earnings per share--pro forma.........................    $  2.00   $  1.88    $  1.22
                                                                      -------   -------    -------
</TABLE>


   This pro forma impact only takes into account options granted since July 1,
1995 and is likely to increase in future years as additional options are
granted and amortized ratably over the respective vesting period.

   The fair values of option grants were determined using the Black-Scholes
option-pricing model with the following assumptions:

<TABLE>
<CAPTION>
                                                                Year Ended June 30,
                                                          --------------------------------
                                                            2001         2000       1999
                                                          ---------   ---------    -------
    <S>                                                   <C>         <C>          <C>
    Dividend yield.....................................        0.50%       0.40%      None
    Volatility.........................................          34%         35%        35%
    Risk-free interest rate............................        4.94%       6.17%      5.78%
    Expected life......................................   5.5 Years   4.5 Years    4 Years
</TABLE>


   The weighted average fair value of options granted was $14.44 in 2001,
$14.29 in 2000 and $9.34 in 1999.

   The following table summarizes information concerning outstanding and
exercisable stock options at June 30, 2001.

<TABLE>
<CAPTION>

                                                                                            Stock Options
                                                     Stock Options Outstanding               Exercisable
                                              ----------------------------------------    ------------------
                                                              Weighted        Weighted              Weighted
                                                               Average         Average               Average
                 Range of Exercise                            Remaining       Exercise              Exercise
                        Prices                 Options    Contractual Life      Price     Options     Price
--------------------------------------------  ---------   ----------------    --------    -------   --------
<S>                                           <C>         <C>                 <C>         <C>       <C>
$ 13.88--$ 26.19                                666,606         4.65           $20.13     518,686    $19.63
$ 26.94--$ 37.00                                566,199         8.37           $29.70     240,955    $28.26
$ 37.03--$ 41.58                                767,000         9.44           $38.44      88,970    $37.07
                                              ---------                                   -------
                                              1,999,805         7.54           $29.86     848,611    $23.91
                                              =========                                   =======
</TABLE>


 Shareholder Rights Plan

   On May 22, 1991, we adopted a Shareholder Rights Plan. The purpose of the
plan is to prevent us from being the target of an unsolicited tender offer or
unfriendly takeover. On May 16, 2000, we amended the Shareholder Rights Plan
to provide for (i) an extension of the final expiration date of the
Shareholder Rights Plan from June 2, 2001 to June 2, 2011 and (ii) a change in
the purchase price of the rights from $300.00 to $200.00 per one one-
thousandths of a share of Series A Preferred Stock, subject to adjustment.

   Under the plan, our common stockholders were issued one preferred stock
purchase right for each share of common stock owned by them. Until they are
redeemed by us or expire, each preferred stock purchase


                                      F-14
<PAGE>

                       DATASCOPE CORP. AND SUBSIDIARIES.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                 (Dollars in thousands, except per share data)

8.  Stock Options, Shareholder Rights and Stock Repurchase Plans--(Continued)

right entitles the holder to purchase .001 share of our Series A Preferred
Stock, par value $1.00 per share, at an exercise price of $200. We may redeem
the preferred stock purchase rights for $.01 per right at any time until after
the date on which our right to redeem them has expired. In addition, the
preferred stock purchase rights do not become exercisable until our right to
redeem them has expired. Our right to redeem the preferred stock purchase
rights expires on the 10th business day after the date of a public
announcement that a person, or an acquiring person, has acquired ownership of
our stock representing 15 percent or more of our shareholders' general voting
power. Before an acquiring person acquires 50% or more of our outstanding
common stock, the plan provides that we may offer to exchange the rights, in
whole or in part, on the basis of an exchange ratio of one share of common
stock for each right. However, any rights owned by the acquiring person and
its affiliates and associates will be null and void and cannot be exchanged
for common stock.

   The plan also provides that, after the date of a public announcement that a
person has acquired ownership of our stock representing 15 percent or more of
our shareholders' general voting power, generally each holder of a preferred
stock purchase right will have the right to purchase, at the exercise price, a
number of shares of our preferred stock having a market value equal to twice
the exercise price. The plan further provides that if certain other business
combinations occur, generally each holder of a preferred stock purchase right
will have the right to purchase, at the exercise price, a number of shares of
the acquiring person's common stock having a market value of twice the
exercise price.

 Stock Repurchase Plans

   On May 3, 1996, we announced a stock repurchase program for up to $20
million of our common stock. We acquired 876,702 shares and completed the
program in fiscal 1999.

   We announced a second $20 million stock repurchase program on August 5,
1998. We acquired 832,286 shares and completed this program in fiscal 2000.

   On September 14, 1999, we announced a third stock repurchase program for $30
million. We acquired 841,287 shares and completed the program in fiscal 2001.

   A fourth stock repurchase program for $40 million was announced on May 16,
2001. We acquired 163,166 shares through June 30, 2001 at a cost of $7.0
million.

 Stock Compensation Plan for Non-Employee Directors

   We have a compensation plan for non-employee directors, which became
effective in calendar year 1998. A summary of this plan is shown below:

   o Any member of the board of directors who is not an employee or a
     consultant to us or any of our divisions or subsidiaries will receive an
     annual retainer (currently $24 thousand) payable in shares of our common
     stock.

   o Payment of the annual retainer is made in January for the prior calendar
     year.

   o A non-employee director may elect to defer receipt of the annual retainer
     in which case the annual retainer will be paid entirely in shares of our
     common stock that will be deposited into a director's account established
     under the plan.

   o In the case of a non-employee director who does not elect to defer the
     retainer (or who has not filed a form of election), 39.6% of the retainer
     will be paid in cash (to approximate current federal income tax
     liability) and the balance in our common stock.


                                      F-15
<PAGE>

                       DATASCOPE CORP. AND SUBSIDIARIES.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                 (Dollars in thousands, except per share data)

8.  Stock Options, Shareholder Rights and Stock Repurchase Plans--(Continued)

   o Distribution of amounts in a director's account will be made when an
     event of distribution occurs, in accordance with the method of
     distribution stated in the form of election.

9.  Segment Information

   Our business is the development, manufacture and sale of medical devices. We
have two reportable segments, Cardiac Assist/Monitoring Products and Collagen
Products/Vascular Grafts.

   The Cardiac Assist/Monitoring Products segment includes electronic intra-
aortic balloon pumps and catheters that are used in the treatment of vascular
disease and electronic physiological monitors that provide for patient safety
and management of patient care.

   The Collagen Products/Vascular Grafts segment includes extravascular
hemostasis devices, which are used to seal arterial puncture wounds to stop
bleeding after cardiovascular catheterization procedures, and a proprietary
line of knitted and woven polyester vascular grafts and patches for
reconstructive vascular and cardiovascular surgery.

   We have aggregated our product lines into two segments based on similar
manufacturing processes, distribution channels, regulatory environments and
customers. Management evaluates the revenue and profitability performance of
each of our product lines to make operating and strategic decisions. We have
no intersegment revenue.

<TABLE>
<CAPTION>

                                                                               Cardiac      Collagen
                                                                               Assist/     Products/    Corporate
                                                                              Monitoring    Vascular       and
                                                                               Products      Grafts     Other (a)   Consolidated
                                                                              ----------   ---------    ---------   ------------
   <S>                                                                        <C>          <C>          <C>         <C>
   Year ended June 30, 2001
   Net sales to external customers........................................     $229,670     $82,108      $ 1,022      $312,800
   Operating earnings.....................................................     $ 23,510     $16,606      $ 5,681      $ 45,797
   Assets.................................................................     $181,340     $59,343      $69,652      $310,335
   Capital expenditures...................................................     $  7,013     $ 2,145      $ 1,550      $ 10,708
   Depreciation and amortization..........................................     $ 11,277     $ 1,524      $ 1,181      $ 13,982

   Year ended June 30, 2000
   Net sales to external customers........................................     $223,135     $77,997      $   268      $301,400
   Operating earnings (b).................................................     $ 28,523     $17,161      $(5,167)     $ 40,517
   Assets.................................................................     $155,088     $52,724      $87,514      $295,326
   Capital expenditures...................................................     $ 16,700     $11,014      $   641      $ 28,355
   Depreciation and amortization..........................................     $ 10,316     $ 1,410      $ 1,205      $ 12,931

   Year ended June 30, 1999
   Net sales to external customers........................................     $207,589     $63,874      $    37      $271,500
   Operating earnings (b).................................................     $ 26,490     $ 7,851      $(3,858)     $ 30,483
   Assets.................................................................     $140,962     $40,237      $88,254      $269,453
   Capital expenditures...................................................     $ 12,078     $ 1,654      $   549      $ 14,281
   Depreciation and amortization..........................................     $  9,354     $ 1,497      $ 1,244      $ 12,095
</TABLE>

---------------
    (a) Net sales of life science products by Genisphere are included within
        Corporate and Other. Assets within Corporate and Other include cash,
        marketable securities, property, plant and equipment including the
        corporate headquarters, goodwill and cash surrender value of officers'
        life insurance.


                                      F-16
<PAGE>

                       DATASCOPE CORP. AND SUBSIDIARIES.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                 (Dollars in thousands, except per share data)

9.  Segment Information--(Continued)

   Reconciliation to consolidated earnings before income taxes:

                                                       Year Ended June 30,
                                                  ----------------------------
                                                    2001      2000       1999
                                                  -------    -------   -------
   Consolidated operating earnings (b) ........   $45,797    $40,517   $30,483
   Interest income, net .......................     3,618      3,638     3,313
   Other income (expense) .....................       176       (132)     (583)
   Special items ..............................        --      3,825    (3,429)
                                                  -------    -------   -------
   Consolidated earnings before taxes .........   $49,591    $47,848   $29,784
                                                  =======    =======   =======

---------------
    (b) Excludes special items: gain on sale of technology of $3.8 million in
        fiscal 2000 and restructuring expenses of $3.4 million in fiscal 1999.



   The following table presents net sales by geography based on the location of
the external customer.

                                                     Year Ended June 30,
                                               -------------------------------
                                                 2001        2000       1999
                                               --------    --------   --------
   United States ............................  $222,484    $215,009   $195,546
   Foreign countries ........................    90,316      86,391     75,954
                                               --------    --------   --------
    Total ...................................  $312,800    $301,400   $271,500
                                               ========    ========   ========

   The following table presents long-lived assets by geography.


                                                         June 30,
                                              ------------------------------
                                                2001        2000       1999
                                              --------    --------   -------
   United States ............................ $101,644    $ 94,608   $70,526
   Foreign countries ........................   13,256      13,570    10,225
                                              --------    --------   -------
    Total ................................... $114,900    $108,178   $80,751
                                              ========    ========   =======

10.  Retirement Benefit Plans

   We have various retirement benefit plans covering substantially all U.S. and
international employees. Total expense for the domestic and international
retirement plans was $4.2 million in 2001, $4.4 million in 2000 and $4.0
million in 1999.

 Defined Benefit Plan--U.S.

   We have a defined benefit pension plan designed to provide retirement
benefits to substantially all U.S. employees. U.S. pension benefits are based
on years of service, compensation and the primary social security benefits.
Funding for the U.S. plan is within the range prescribed under the Employee
Retirement Income Security Act of 1974.



                                      F-17
<PAGE>

                       DATASCOPE CORP. AND SUBSIDIARIES.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                 (Dollars in thousands, except per share data)


10.  Retirement Benefit Plans--(Continued)


   The change in benefit obligation, change in plan assets and funded status of
the U.S. defined benefit pension plan is shown below:

<TABLE>
<CAPTION>
                                                                                                       Year Ended June 30,
                                                                                                 -------------------------------
                                                                                                   2001        2000       1999
                                                                                                 --------    --------   --------
   <S>                                                                                           <C>         <C>        <C>
   Change in Benefit Obligation
    ----------------------------
    Pension benefit obligation at beginning of year ..........................................   $ 27,914    $ 29,240   $ 25,913
    Service cost .............................................................................      1,767       2,018      1,903
    Interest cost ............................................................................      2,192       1,971      1,800
    Plan amendments ..........................................................................         --          --        (41)
    Actuarial loss (gain) ....................................................................      3,807      (4,710)       152
    Benefits paid ............................................................................       (735)       (605)      (487)
                                                                                                 --------    --------   --------
      Pension benefit obligation at end of year ..............................................   $ 34,945    $ 27,914   $ 29,240
                                                                                                 ========    ========   ========
   Change in Plan Assets
    ---------------------
    Fair value of plan assets at beginning of year ...........................................   $ 28,203    $ 26,444   $ 23,623
    Actual return on assets ..................................................................      2,695       1,614      1,675
    Employer contributions ...................................................................        804         750      1,633
    Benefits paid ............................................................................       (735)       (605)      (487)
                                                                                                 --------    --------   --------
      Fair value of plan assets at end of year ...............................................   $ 30,967    $ 28,203   $ 26,444
                                                                                                 ========    ========   ========
   Funded Status at June 30,
    -------------------------
    Pension benefit obligation ...............................................................   $(34,945)   $(27,914)  $(29,240)
    Fair value of plan assets ................................................................     30,967      28,203     26,444
                                                                                                 --------    --------   --------
    Funded status--plan assets (less) more than benefit obligation ...........................     (3,978)        289     (2,796)
    Unrecognized prior service cost ..........................................................         25          26         27
    Unrecognized net actuarial loss (gain) ...................................................      2,049      (1,321)     2,953
    Unrecognized net obligation remaining at June 30, ........................................        184         254        325
                                                                                                 --------    --------   --------
      (Accrued) Prepaid pension cost .........................................................   $ (1,720)   $   (752)  $    509
                                                                                                 ========    ========   ========
</TABLE>


   The components of net pension expense of the U.S. defined benefit pension
plan include the following:

<TABLE>
<CAPTION>
                                                                                                         Year Ended June 30,
                                                                                                    ----------------------------
                                                                                                      2001      2000       1999
                                                                                                    -------    -------   -------
   <S>                                                                                              <C>        <C>       <C>
    Pension Expense
      ---------------
    Service cost ................................................................................   $ 1,767    $ 2,018   $ 1,903
    Interest cost ...............................................................................     2,192      1,971     1,800
    Expected return on assets ...................................................................    (2,258)    (2,050)   (1,855)
    Amortization of net loss and unrecognized prior service cost ................................         1          1        31
    Amortization of the remaining unrecognized net obligation ...................................        71         71        71
                                                                                                    -------    -------   -------
       Net pension expense ......................................................................   $ 1,773    $ 2,011   $ 1,950
                                                                                                    =======    =======   =======
</TABLE>


                                      F-18
<PAGE>

                       DATASCOPE CORP. AND SUBSIDIARIES.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                 (Dollars in thousands, except per share data)


10.  Retirement Benefit Plans--(Continued)


                                                            Year Ended June 30,
                                                            -------------------
                                                            2001   2000    1999
                                                            ----   ----    ----
    Actuarial Assumptions
    ---------------------
      Discount rate......................................   7.25%  7.75%   7.00%
      Salary increase....................................   6.00%  6.00%   6.00%
      Long-term return on assets.........................   7.75%  7.75%   7.75%


   Plan assets are invested in U.S. Government and corporate securities and
include investments in our common stock of $4.4 million (96,000 shares) at
June 30, 2001.

 Defined Benefit Plans--International

   We have international defined benefit pension plans. Retirement benefits are
based on years of service, final average earnings and social security
benefits. Funding policies are based on local statutes and the assets are
invested in guaranteed insurance contracts.

   The funded status and components of net pension expense of the international
defined benefit pension plans are shown below:

<TABLE>
<CAPTION>
                                                                                                         Year Ended June 30,
                                                                                                    ----------------------------
                                                                                                      2001      2000       1999
                                                                                                    -------    -------   -------
   <S>                                                                                              <C>        <C>       <C>
   Funded Status at June 30,
    -------------------------
    Pension benefit obligation ..................................................................   $(1,960)   $(1,554)  $(1,827)
    Fair value of plan assets ...................................................................       281        272       266
                                                                                                    -------    -------   -------
    Funded status ...............................................................................    (1,679)    (1,282)   (1,561)
    Unrecognized net actuarial loss .............................................................     1,052        815     1,256
    Unrecognized net obligation remaining at June 30, ...........................................        50         67        83
                                                                                                    -------    -------   -------
      Accrued pension cost ......................................................................   $  (577)   $  (400)  $  (222)
                                                                                                    =======    =======   =======
</TABLE>

<TABLE>
<CAPTION>
                                                                                                             Year Ended June 30,
                                                                                                             -------------------
                                                                                                             2001    2000   1999
                                                                                                             ----    ----   ----
   <S>                                                                                                       <C>     <C>    <C>
   Pension Expense
    ---------------
    Service cost .........................................................................................   $159    $192   $199
    Interest cost ........................................................................................    129     119    114
    Expected return on assets ............................................................................    (26)    (27)   (26)
    Amortization of net loss and unrecognized prior service cost .........................................     28      35     37
    Amortization of the remaining unrecognized net obligation ............................................     17      17     17
                                                                                                             ----    ----   ----
      Net pension expense ................................................................................   $307    $336   $341
                                                                                                             ====    ====   ====
</TABLE>

<TABLE>
<CAPTION>
                                                                                                             Year Ended June 30,
                                                                                                             -------------------
                                                                                                             2001    2000   1999
                                                                                                             ----    ----   ----
   <S>                                                                                                       <C>     <C>    <C>
   Actuarial Assumptions
    ---------------------
    Discount rate ........................................................................................   7.25%   7.75%  7.00%
    Salary increase ......................................................................................   6.00%   6.00%  6.00%
    Long-term return on assets ...........................................................................   7.75%   7.75%  7.75%
</TABLE>



                                      F-19
<PAGE>

                       DATASCOPE CORP. AND SUBSIDIARIES.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                 (Dollars in thousands, except per share data)


10.  Retirement Benefit Plans--(Continued)


 Supplemental Retirement Plans

   We have noncontributory, unfunded supplemental defined benefit retirement
plans for the Chairman and Chief Executive Officer, Mr. Lawrence Saper, and
certain current and former key officers. Life insurance has been purchased to
recover a substantial portion of the net after tax cost for these supplemental
retirement plans. The assumptions used to develop the supplemental pension
cost and the actuarial present value of the projected benefit obligation are
reviewed annually.

   A summary of Mr. Saper's supplemental pension plan is as follows:

   o Mr. Saper is entitled to receive a lifetime pension of up to 60% of his
     average earnings for the three-year period in which Mr. Saper's
     compensation was greatest of the ten years immediately preceding his
     retirement.

   o The supplementary retirement benefit will not be less than the value of
     the benefit that would have been payable had his retirement occurred at
     age 65.

   o The plan provides survivor benefits in the form of a $10 million life
     insurance policy, maintained pursuant to a split-dollar agreement between
     us, Mr. Saper and a trust for the benefit of Mr. Saper's family.

   The supplemental pension expense for Mr. Saper recognized in the
consolidated financial statements was $385 thousand in 2001, $304 thousand in
2000 and $148 thousand in 1999.

   The supplemental retirement plan covering certain former key officers
provides a pension at age 65, for up to 15 years, based on a predetermined
earnings level for the five-year period prior to retirement. The supplemental
retirement benefit for two current officers provides a lifetime retirement
benefit. The supplemental pension expense for these executives recognized in
the consolidated financial statements was $129 thousand in 2001, $101 thousand
in 2000 and $17 thousand in 1999.



                                      F-20
<PAGE>

                       DATASCOPE CORP. AND SUBSIDIARIES.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                 (Dollars in thousands, except per share data)


10.  Retirement Benefit Plans--(Continued)

   The change in benefit obligation, funded status and components of net
pension expense of the supplemental defined benefit retirement plans are shown
below:

<TABLE>
<CAPTION>
                                                                                                       Year Ended June 30,
                                                                                                 -------------------------------
                                                                                                   2001        2000       1999
                                                                                                 --------    --------   --------
   <S>                                                                                           <C>         <C>        <C>
   Change in Benefit Obligation
   ----------------------------
    Pension benefit obligation at beginning of year ..........................................   $  8,931    $  8,474   $  7,466
    Service cost .............................................................................        289         212        183
    Interest cost ............................................................................        682         592        513
    Actuarial loss (gain) ....................................................................      2,078        (312)       137
    Benefits paid ............................................................................        (35)        (35)       (35)
                                                                                                 --------    --------   --------
      Pension benefit obligation at end of year ..............................................   $ 11,945    $  8,931   $  8,264
                                                                                                 ========    ========   ========
   Funded Status at June 30,
   -------------------------
    Pension benefit obligation ...............................................................   $(11,945)   $ (8,931)  $ (8,264)
    Unrecognized prior service cost ..........................................................        215         410        440
    Unrecognized net actuarial gain ..........................................................        (37)     (2,768)    (3,094)
                                                                                                 --------    --------   --------
      Accrued pension liability ..............................................................   $(11,767)   $(11,289)  $(10,918)
                                                                                                 ========    ========   ========
   Pension Expense
   ---------------
    Service cost .............................................................................   $    289    $    212   $    183
    Interest cost ............................................................................        682         592        513
    Amortization of net gain .................................................................       (721)       (639)      (751)
    Amortization of unrecognized prior service cost ..........................................        264         240        220
                                                                                                 --------    --------   --------
      Net pension expense ....................................................................   $    514    $    405   $    165
                                                                                                 ========    ========   ========
   Actuarial Assumption
   --------------------
    Discount rate ............................................................................       7.25%       7.75%      7.00%
</TABLE>


 Defined Contribution Plans

   We have defined contribution savings and supplemental retirement plans that
cover substantially all U.S. employees and certain international employees.
The plans provide an incentive to employees to save and invest regularly for
their retirement. In the U.S. we maintain a 401(k) savings and supplemental
retirement plan for eligible domestic employees. The contributions are based
on matching 50% of participating employees' contributions up to a maximum of
6% of compensation. The provisions for the international defined contribution
plans vary by local country. The total expense under these plans was $1.65
million for 2001, $1.68 million for 2000 and $1.58 million for 1999.


                                      F-21
<PAGE>

                       DATASCOPE CORP. AND SUBSIDIARIES.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                 (Dollars in thousands, except per share data)


11.  Commitments and Contingencies

 Leases
   Future minimum rental commitments under noncancellable operating leases are
as follows:

<TABLE>
<CAPTION>

    Year
    ----
    <S>                                                                       <C>
    2002 ..................................................................   $2,838
    2003 ..................................................................    2,519
    2004 ..................................................................    1,865
    2005 ..................................................................      683
    2006 ..................................................................      328
      Thereafter...........................................................    1,100
                                                                              ------
       Total future minimum rental payments ...............................   $9,333
                                                                              ======
</TABLE>


   Total rent expense amounted to approximately $3.52 million in 2001, $5.0
million in 2000 and $4.54 million in 1999.

 Litigation
   We are subject to litigation in the ordinary course of our business. We
believe we have meritorious defenses in all material pending lawsuits and that
the outcome will not have a material adverse effect on our financial position
or results of operations.

 Credit Arrangements
   We have lines of credit totaling $100.4 million, with interest payable at
each lender's prime rate. We did not have any borrowings at June 30, 2001 or
June 30, 2000. Of the total available, $25 million expires in November 2001,
$25 million expires in December 2001 and $25 million expires in March 2002.
These lines are renewable annually at the option of the banks, and we plan to
renew them. We also have $25.4 million in lines of credit with no expiration
date.

12.  Gain on Sale of Technology
   In the third quarter of fiscal 2000 we announced the sale of technology from
a discontinued R&D project at our InterVascular, Inc. subsidiary. The sale
resulted in an after-tax gain of $2.5 million.

13.  Restructuring Charge
   In the third and fourth quarters of fiscal 1999, we recorded pre-tax
restructuring charges totaling $3.43 million, or $0.14 per share, related to
cost reduction programs. The pre-tax restructuring charge recorded in the
third quarter was $864 thousand or $0.04 per share and the restructuring
charge recorded in the fourth quarter was $2.57 million or $0.10 per share.
The cost reduction programs and related restructuring charges consist of the
following:

   o Lease termination costs and asset writedowns related to the closing of
     InterVascular's Clearwater, Florida leased manufacturing facility. The
     knitting and weaving operations housed in the Clearwater facility were
     moved to InterVascular's expanded manufacturing facility in La Ciotat,
     France in the second quarter of fiscal 2001.

     The asset writedowns relate primarily to research and production
     equipment and leasehold improvements that were removed from service and
     disposed. The assets have no salvage value.

   o Employee severance expenses related to workforce reductions and closing
     of the Clearwater facility. Approximately 98% of the 80 terminated
     employees left by June 30, 2001. The balance of the


                                      F-22
<PAGE>

                       DATASCOPE CORP. AND SUBSIDIARIES.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                 (Dollars in thousands, except per share data)


13.  Restructuring Charge--(Continued)


     employees will be leaving over the next 6 months. The employee
     terminations were primarily in administrative, R&D and manufacturing
     positions.

   o Writedown of certain Genisphere fixed assets based on our revised market
     entry strategy for the 3DNA technology. The asset writedowns were
     primarily for manufacturing equipment that was removed from service.

   A summary of the restructuring charges is shown below:

<TABLE>
<CAPTION>
                                                                                 Clearwater,                 Genisphere
                                                                                   Florida       Employee      Asset
                                                                                Plant Closure   Severance    Writedown     Total
                                                                                -------------   ---------    ----------   ------
   <S>                                                                          <C>             <C>          <C>          <C>
   Fiscal 1999 charges......................................................        $880          $1,674        $875      $3,429
   Utilized in fiscal 1999..................................................         535             482         875       1,892
   Utilized in fiscal 2000..................................................         187             881          --       1,068
   Utilized in fiscal 2001..................................................         158             252          --         410
                                                                                    ----          ------        ----      ------
   Remaining liability at June 30, 2001.....................................        $ --          $   59        $ --      $   59
                                                                                    ====          ======        ====      ======
</TABLE>


   No additional expenditures are expected to complete the restructuring
program.

14.  Quarterly Financial Data (Unaudited)

<TABLE>
<CAPTION>

                                                                                              Year Ended June 30, 2001
                                                                                 --------------------------------------------------
                                                                                  First     Second     Third     Fourth
                                                                                 Quarter   Quarter    Quarter    Quarter     Total
                                                                                 -------   -------    -------    -------   --------
<S>                                                                              <C>       <C>        <C>        <C>       <C>
Net sales....................................................................    $68,300   $76,100    $82,200    $86,200   $312,800
                                                                                 -------   -------    -------    -------   --------
Gross margin.................................................................    $40,638   $46,050    $49,672    $51,410   $187,770
                                                                                 -------   -------    -------    -------   --------
Net earnings.................................................................    $ 6,083   $ 8,167    $ 8,640    $11,353   $ 34,243
                                                                                 -------   -------    -------    -------   --------
Earnings per share, basic....................................................    $  0.41   $  0.55    $  0.58    $  0.77   $   2.30
                                                                                 -------   -------    -------    -------   --------
Earnings per share, diluted..................................................    $  0.39   $  0.53    $  0.56    $  0.74   $   2.20
                                                                                 -------   -------    -------    -------   --------
</TABLE>


<TABLE>
<CAPTION>

                                                                                              Year Ended June 30, 2000
                                                                                 --------------------------------------------------
                                                                                  First     Second     Third     Fourth
                                                                                 Quarter   Quarter    Quarter    Quarter     Total
                                                                                 -------   -------    -------    -------   --------
<S>                                                                              <C>       <C>        <C>        <C>       <C>
Net sales....................................................................    $64,100   $75,500    $78,300    $83,500   $301,400
                                                                                 -------   -------    -------    -------   --------
Gross margin.................................................................    $39,286   $45,909    $47,553    $48,987   $181,735
                                                                                 -------   -------    -------    -------   --------
Net earnings.................................................................    $ 4,830   $ 7,371    $10,495    $10,379   $ 33,075
                                                                                 -------   -------    -------    -------   --------
Earnings per share, basic....................................................    $  0.32   $  0.49    $  0.70    $  0.70   $   2.18
                                                                                 -------   -------    -------    -------   --------
Earnings per share, diluted..................................................    $  0.30   $  0.46    $  0.66    $  0.66   $   2.06
                                                                                 -------   -------    -------    -------   --------
</TABLE>


   Quarterly and total year earnings per share are calculated independently
based on the weighted average number of shares outstanding during each period.




                                      F-23
<PAGE>


                       DATASCOPE CORP. AND SUBSIDIARIES.

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS--(Continued)
                 (Dollars in thousands, except per share data)


15.  Earnings Per Share

   The computation of basic and diluted earnings per share is shown in the
table below.

<TABLE>
<CAPTION>

                                                                                                         Year Ended June 30,
                                                                                                    ----------------------------
                                                                                                      2001      2000       1999
                                                                                                    -------    -------   -------
   <S>                                                                                              <C>        <C>       <C>
   Net earnings .................................................................................   $34,243    $33,075   $21,412
                                                                                                    -------    -------   -------
   Weighted average shares outstanding for basic earnings per share .............................    14,904     15,169    15,247
   Effect of dilutive employee stock options ....................................................       643        911       474
                                                                                                    -------    -------   -------
   Weighted average shares outstanding for diluted earnings per share ...........................    15,547     16,080    15,721
                                                                                                    =======    =======   =======
   Basic earnings per share .....................................................................   $  2.30    $  2.18   $  1.40
                                                                                                    -------    -------   -------
   Diluted earnings per share ...................................................................   $  2.20    $  2.06   $  1.36
                                                                                                    -------    -------   -------
</TABLE>



                                      F-24
<PAGE>


                        DATASCOPE CORP. AND SUBSIDIARIES

                 SCHEDULE II--VALUATION AND QUALIFYING ACCOUNTS
                                 (In thousands)

<TABLE>
<CAPTION>
                           Column A                                Column B             Column C             Column D     Column E
                         -----------                             ------------    -----------------------    ----------   ----------
                                                                                        Additions
                                                                                 -----------------------
                                                                                    (1)           (2)
                                                                                Charged to    Charged to    Deductions
                                                                  Balance at       Costs         Other         from      Balance at
                         Description                             Beginning of       and       Accounts--    Reserves--    Close of
                         -----------                                Period       Expenses      Describe      Describe      Period
                                                                 ------------   ----------    ----------    ----------   ----------
<S>                                                              <C>            <C>           <C>           <C>          <C>
Year Ended June 30, 2001
Allowance for doubtful accounts..............................       $1,644         $ 34           $--        $328(A)       $1,350
                                                                    ======         ====           ===        =======       ======
Reserve for warranty costs...................................          640           --            --         290(A)          350
                                                                    ======         ====           ===        =======       ======
Year Ended June 30, 2000
Allowance for doubtful accounts..............................       $1,192         $567           $--        $115(A)       $1,644
                                                                    ======         ====           ===        =======       ======
Reserve for warranty costs...................................          640           --            --             --          640
                                                                    ======         ====           ===        =======       ======
Year Ended June 30, 1999
Allowance for doubtful accounts..............................       $1,078         $357           $--        $243(A)       $1,192
                                                                    ======         ====           ===        =======       ======
Reserve for warranty costs...................................          640           --            --             --          640
                                                                    ======         ====           ===        =======       ======
</TABLE>

---------------
(A) Write-offs



                                      S-1