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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 Form 10-K
 (Mark One)
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended June 30, 2008
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from            to
 Commission file number 000-06516
 Datascope Corp.
 (Exact name of registrant as specified in its charter)
 Delaware(State or other jurisdiction of 
incorporation or organization)
    
    13-2529596(I.R.S. Employer
Identification No.)14 Philips Parkway 
Montvale, New Jersey(Address of principal executive offices)
    
    07645(Zip Code)
 (201) 391-8100  (Registrants telephone number, including area code)
 Securities registered pursuant to Section 12(b) of the Act:
None
 Securities registered pursuant to section 12(g) of the Act:
 Title of Each Class
  o þ
  o þ
 þ o
 o
  Large accelerated filer o
Accelerated filer þ
Non-accelerated filer o
(Do not check if a smaller reporting company)
Smaller reporting company o  o þ
  DOCUMENTS INCORPORATED BY REFERENCE




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##### 



DATASCOPE CORP.
 FORM 10-K
 TABLE OF CONTENTS
 Form 10-KItem No.
    
    Name of Item
    
    PagePART IItem 1.
    
    Business
    
    
    1Item 1A.
    
    Risk Factors
    
    
    15Item 1B.
    
    Unresolved Staff Comments
    
    
    18Item 2.
    
    Properties
    
    
    19Item 3.
    
    Legal Proceedings
    
    
    19Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    20Item 4A.
    
    Executive Officers of the Company
    
    
    20PART IIItem 5.
    
    Market for Registrants Common Equity, Related Stockholder Matters and
Issuer Purchases of Equity Securities
    
    
    21Item 6.
    
    Selected Financial Data
    
    
    24Item 7.
    
    Managements Discussion and Analysis of Financial Condition and Results
of Operations
    
    
    25Item 7A.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    40Item 8.
    
    Financial Statements and Supplementary Data
    
    
    41Item 9.
    
    Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
    
    
    41Item 9A.
    
    Controls and Procedures
    
    
    41Item 9B.
    
    Other Information
    
    
    42PART IIIItem 10.
    
    Directors, Executive Officers and Corporate Governance
    
    
    42Item 11.
    
    Executive Compensation
    
    
    42Item 12.
    
    Security Ownership of Certain Beneficial Owners and Management and
Related Stockholder Matters
    
    
    43Item 13.
    
    Certain Relationships and Related Transactions, and Director Independence
    
    
    43Item 14.
    
    Principal Accountant Fees and Services
    
    
    43PART IVItem 15.
    
    Exhibits and Financial Statement Schedules
    
    
    44EX-21.1: SUBSIDIARIESEX-23.1: CONSENT OF DELOITTE & TOUCHE LLPEX-31.1: CERTIFICATIONEX-31.2: CERTIFICATIONEX-32.1: CERTIFICATIONS
  i




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PART I
 This Annual 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, 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 Annual Report on Form 10-K , including, without limitation, the
information set forth below under Item 1 regarding the description of our business, under Item 1A,
Risk Factors 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 Annual 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
 Overview
   1




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tm tm
    TM TM1
 
 1
    
    Carbofilm is a pending trademark of Sorin Biomedica
Cardio. 2




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tm
    Available Information
 http://www.sec.gov http://www.datascope.com
   Glossary
  Angioplasty
 3




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Balloon Angioplasty
 French (Fr.)
 Hemostasis
 Manual Compression
 Percutaneously
 Stenting
 Vascular Access
 Reportable Segments
  Fiscal Year Ended June 30,2008
    
    2007
    
    2006Cardiac Assist
    
    
    82
    %
    
    
    83
    %
    
    
    83
    %Vascular Products
    
    
    17
    %
    
    
    16
    %
    
    
    16
    %
  Cardiac Assist
   4




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Counterpulsation Products
   Intra-Aortic Balloon Pumps (IABPs)
 CS300
  CS100
 TM
 System 98XT
  Significant Developments
  
    
    CS300 pump sales began in March 2007 to the U.S. and European markets
    
    CS100 approval to distribute in Japan received in August 2004
    
    CS100 United States and European market introduction in August 2003
 Intra-Aortic Balloon Catheters (IABs)
  5




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Sensation 7 Fr.
  Linear TM
  Fidelity
   Ò 2
 
 2
    
    StatLock is a registered trademark of Venetec
International, Inc. 6




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##### Table of Contents



Clinical Support
  
    
    Telemedicine via our PC-IABP products which offers remote pump monitoring, allowing the
healthcare provider continuous access and instantaneous troubleshooting from highly trained
technicians.
    
    24 hour, 7 day clinical support.
    
    On-site training and education for all personnel involved with patient care; more than
30,000 clinicians are trained by our clinical staff annually.
    
    Comprehensive educational materials for hospital staff, patient and family.
    
    Consultative services to help hospitals maximize the goals of counterpulsation therapy
within the hospital network.
    
    The BenchmarkÒ 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. We believe that we are the only supplier offering a comprehensive,
centralized repository of global IABP information.
 Endoscopic Vessel Harvesting
    ClearGlide Optical Vessel Dissector
 ClearGlide Ultra Retractor
 ClearGlide Precision Bipolar Device
 7




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ClearGlide Radial Artery Kit
 Markets, Sales and Competition.
  Manual Compression Assist Product
    Advantages of Safeguard
 
    
    Assists in obtaining and maintaining hemostasis during patient recovery and maximizes
valuable staff resources.
    
    Reduces active compression time in femoral artery cannulation following diagnostic and
interventional procedures.
    
    Innovative design makes Safeguard easy to apply and simple to use.
    
    Provides direct visualization of the site and allows for immediate pressure adjustments.
    
    Enhanced patient comfort: Safeguard is flexible and conformable; it does not restrict
patient mobility and no ancillary equipment or straps are required.
 8




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##### Table of Contents



Significant Developments  Safeguard
  
    
    Safeguard device received FDA 510(k) clearance to claim reduced active (manual)
compression time needed to stop bleeding following femoral arterial catheterization in
diagnostic and interventional procedures in March 2007.
    
    Safeguard 12cm received the CE Mark in June 2005.
    
    Determined to be a Class I, exempt product within the FDA regulations.
    
    Safeguard 24cm received the CE Mark in October 2003.
 Markets, Sales and Competition.
  Vascular Products
   Vascular Grafts and Patches
     9




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Vascular Stent Products
  Peripheral Stents
      Balloon Catheters
  Stent Grafts
 VI Aorto UniFemoral StentGraft
 10




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VI Extender Cuff
 Significant Developments
  
    
    In June 2008, we exercised our option to acquire the Peripheral Vascular Stent business
of the Sorin Group of Milan.
    
    In January 2007, we purchased a five-year license from the Sorin Group of Milan, Italy,
for exclusive worldwide distribution rights to Sorins peripheral vascular stent products,
excluding the United States and Japan.
    
    InterGard Thoracic Aortic Root Graft was introduced in Europe in May 2006.
    
    Effective February 2006, InterVascular became the exclusive distributor of Vascular
Innovations Stent Grafts (AUF and Extender Cuff), in all worldwide markets exclusive of
Japan and the United States.
    
    HemaPatch Silver was introduced in Europe in March 2004.
    
    HemaCarotid Patch Heparin was introduced in Europe in March 2004.
    
    Interflow
 Markets, Sales and Competition
     Life Science Research Products
 Ò
 11




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Research and Development (R&D)
  Marketing
    12




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Competition
  Seasonality
  Suppliers
  Intellectual Property
  Employees
  Orders Backlog
  13




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Regulation
         14




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Item 1A. Risk Factors
  Our markets are highly competitive and we face rapid technological changes in the medical device
industry, which may impact the growth of our business.
   Our future growth is dependent upon the development of new products, which requires significant
research and development, clinical trials and regulatory approval, and therefore may not result in
commercially viable products.
  Failure to successfully select, negotiate and integrate acquired technologies, products or
businesses could adversely affect our business.
  15




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
    
    our ability to identify suitable opportunities for acquisition or investment
    
    our ability to finance any future acquisition or investment on terms acceptable to us
    
    litigation related to acquired technologies
    
    our ability to integrate the acquired business or technology successfully with our
existing business
    
    the presence or absence of adequate internal controls and/or significant fraud in the
financial systems of acquired companies
    
    adverse developments arising out of investigations by governmental entities of the
business practices of acquired companies
    
    any decrease in customer loyalty and product orders caused by dissatisfaction with our
combined product lines and sales and marketing practices, including price increases
  We are subject to widespread government regulation which may delay the approval of our products or
result in the recall of previously approved products.
  
    
    take a significant period of time
    
    require the expenditure of substantial resources
    
    involve rigorous pre-clinical and clinical testing
    
    require changes to the products
    
    result in limitations on the indicated uses of the products
  16




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Cost containment pressures and legislative or regulatory reforms may decrease the demand for our
products and the prices that customers are willing to pay for our products.
  Since we derive a significant portion of our revenues from international operations, changes in
international economic or regulatory conditions could have a material impact on the results of our
operations.
  Reduction or interruption in supply of components and materials used to manufacture our products,
resulting from events such as damage to any of our manufacturing facilities or the loss of any of
our sole-source suppliers, and the inability to develop alternative sources of supply, could
impair our ability to meet sales demand and adversely affect our manufacturing operations and
related product sales.
  17




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A loss of key personnel or our inability to attract and retain additional personnel may adversely
affect our business.
  If we are unable to protect our intellectual property successfully our business could be
adversely affected.
  Pending and future litigation and any resulting settlement awards may be costly and impact
our ability to obtain cost-effective third-party insurance coverage in the future.
  
 Item 1B. Unresolved Staff Comments
  18




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Item 2. Properties
  Ownership orGeneral Character
    
    ExpirationLocation
    
    and Use of Property
    
    Date of LeaseFairfield, New Jersey
    
    75,000 sq. feet, used for Cardiac Assist Products
headquarters, manufacturing and R&D of intra-aortic
balloons, R&D of endoscopic vessel harvesting
products and Safeguard.
    
    OwnedHatfield, Pennsylvania
    
    15,000 sq. feet, used for Genisphere manufacturing,
distribution, R&D and warehousing.
    
    Leased (until
6/30/11)La Ciotat, France
    
    30,000 sq. feet, used by InterVascular for
manufacturing, R&D and warehousing of vascular
grafts, and administrative offices.
    
    OwnedMahwah, New Jersey
    
    90,000 sq. feet, used for warehousing, packaging,
distribution and service offices of Cardiac Assist
Products, and offices for IT and customer service.
    
    OwnedMontvale, New Jersey
    
    38,000 sq. feet, used for corporate headquarters
    
    Owned
  
 Item 3. Legal Proceedings
    19




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Item 4. Submission of Matters to a Vote of Security Holders
  
 Item 4A. Executive Officers of the Company
  Name
    
    Age
    
    Positions and Offices Presently HeldLawrence Saper
    
    
    80
    
    
    Chairman of the Board and Chief Executive OfficerAntonino Laudani
    
    
    49
    
    
    Vice President and Chief Operating OfficerHenry M. Scaramelli
    
    
    55
    
    
    Vice President, Finance and Chief Financial OfficerFred Adelman
    
    
    55
    
    
    Vice President, Chief Accounting Officer and TreasurerNicholas E. Barker
    
    
    50
    
    
    Vice President, Corporate DesignRobert O. Cathcart
    
    
    48
    
    
    Vice President; President, Interventional Products DivisionTimothy J. Krauskopf
    
    
    47
    
    
    Vice President, Regulatory and Clinical AffairsBoris Leschinsky
    
    
    43
    
    
    Vice President, Technology
 20




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PART II
 
 Item 5.
    
    Market for the Registrants Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
 Market Information
  Fiscal Year
    
    High
    
    Low
    
    Dividends2007First Quarter
    
    $
    35.83
    
    
    $
    29.23
    
    
    $
    1.07
    (a)Second Quarter
    
    
    37.23
    
    
    
    32.49
    
    
    
    0.10Third Quarter
    
    
    37.98
    
    
    
    33.85
    
    
    
    0.10Fourth Quarter
    
    
    39.06
    
    
    
    34.98
    
    
    
    0.102008First Quarter
    
    $
    39.34
    
    
    $
    29.29
    
    
    $
    0.10Second Quarter
    
    
    40.00
    
    
    
    32.58
    
    
    
    1.20
    (b)Third Quarter
    
    
    41.70
    
    
    
    31.75
    
    
    
    Fourth Quarter
    
    
    48.75
    
    
    
    36.86
    
    
    
    0.10
 
 (a)
    
    In fiscal 2007, we declared a special dividend of $1.00 per share, or $15.3 million,
which was paid on October 6, 2006 to holders of record on September 28, 2006.(b)
    
    In fiscal 2008, we declared a special dividend of $1.00 per share, or $15.4 million,
paid on October 15, 2007 to stockholders of record as of October 1, 2007  21




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Performance Graph
  COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN
 
 Dividend Policy
  Recent Sales of Unregistered Securities
  22




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Issuer Purchases of Equity Securities
  Total Number
    
    
    Maximum Dollarof Shares
    
    
    Value of SharesPurchased as
    
    
    that May Yet BeTotal
    
    
    
    
    
    
    Part of
    
    
    PurchasedNumber of
    
    
    Average
    
    
    Publicly
    
    
    Under theShares
    
    
    Price Paid
    
    
    Announced
    
    
    ProgramsFiscal Period
    
    Purchased
    
    
    Per Share
    
    
    Programs
    
    
    ($ 000s)4/01/08  4/30/08
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    41,1035/01/08  5/31/08
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    41,1036/01/08  6/30/08
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    41,103Total Fourth Quarter
    
    
    
    
    
    $
    
    
    
    
    
    
    
    $
    41,103
  23




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Item 6. Selected Financial Data
  Earnings Statement Data:
 Year Ended June 30,2008
    
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004Net sales
    
    $
    230,915
    
    
    $
    212,991
    
    
    $
    196,516
    
    
    $
    179,266
    
    
    $
    164,390Cost of sales
    
    
    80,013
    
    
    
    74,148
    
    
    
    68,320
    
    
    
    59,176
    
    
    
    55,387Gross profit
    
    
    150,902
    
    
    
    138,843
    
    
    
    128,196
    
    
    
    120,090
    
    
    
    109,003Research and
development expenses
    
    
    21,079
    
    
    
    19,901
    
    
    
    19,129
    
    
    
    20,330
    
    
    
    17,463Selling,
general and administrative expenses
    
    
    92,617
    
    
    
    87,424
    
    
    
    81,152
    
    
    
    78,509
    
    
    
    75,012Other items (a)
    
    
    
    
    
    
    8,737
    
    
    
    
    
    
    
    6,954
    
    
    
    113,696
    
    
    
    116,062
    
    
    
    100,281
    
    
    
    105,793
    
    
    
    92,475Operating earnings
    
    
    37,206
    
    
    
    22,781
    
    
    
    27,915
    
    
    
    14,297
    
    
    
    16,528Other (income) expense:Interest income
    
    
    (2,698
    )
    
    
    (2,479
    )
    
    
    (2,225
    )
    
    
    (2,228
    )
    
    
    (1,822
    )Interest expense
    
    
    84
    
    
    
    36
    
    
    
    228
    
    
    
    221
    
    
    
    25Dividend income (b)
    
    
    
    
    
    
    (196
    )
    
    
    (4,523
    )
    
    
    
    
    
    
    Gain on sale
of investments (c)
    
    
    (13,173
    )
    
    
    (1,273
    )
    
    
    
    
    
    
    
    
    
    
    Other, net
    
    
    1,727
    
    
    
    737
    
    
    
    1,414
    
    
    
    513
    
    
    
    423(14,060
    )
    
    
    (3,175
    )
    
    
    (5,106
    )
    
    
    (1,494
    )
    
    
    (1,374
    )Earnings from continuing operations before income taxes
    
    
    51,266
    
    
    
    25,956
    
    
    
    33,021
    
    
    
    15,791
    
    
    
    17,902Income taxes
    
    
    17,488
    
    
    
    7,662
    
    
    
    8,289
    
    
    
    3,804
    
    
    
    4,745Net earnings from continuing operations
    
    
    33,778
    
    
    
    18,294
    
    
    
    24,732
    
    
    
    11,987
    
    
    
    13,157Net (loss) earnings from discontinued operations (d)
    
    
    (3,544
    )
    
    
    (829
    )
    
    
    1,111
    
    
    
    2,659
    
    
    
    10,751Net gain on sale of discontinued operations (e)
    
    
    76,672
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net earnings
    
    $
    106,906
    
    
    $
    17,465
    
    
    $
    25,843
    
    
    $
    14,646
    
    
    $
    23,908Net earnings per share, basic:Continuing operations
    
    $
    2.19
    
    
    $
    1.20
    
    
    $
    1.65
    
    
    $
    0.81
    
    
    $
    0.89Net earnings
    
    $
    6.92
    
    
    $
    1.15
    
    
    $
    1.73
    
    
    $
    0.99
    
    
    $
    1.62Net earnings per share, diluted:Continuing operations
    
    $
    2.16
    
    
    $
    1.19
    
    
    $
    1.62
    
    
    $
    0.79
    
    
    $
    0.87Net earnings
    
    $
    6.85
    
    
    $
    1.14
    
    
    $
    1.69
    
    
    $
    0.97
    
    
    $
    1.58Weighted average number of common shares outstandingBasic
    
    
    15,441
    
    
    
    15,244
    
    
    
    14,974
    
    
    
    14,795
    
    
    
    14,782Diluted
    
    
    15,617
    
    
    
    15,387
    
    
    
    15,296
    
    
    
    15,124
    
    
    
    15,121Cash dividends declared per common share
    
    $
    1.40
    
    
    $
    1.37
    
    
    $
    1.28
    
    
    $
    2.28
    
    
    $
    0.35
 Balance Sheet Data:
 As of June 30,2008
    
    2007
    
    2006
    
    2005
    
    2004Total assets
    
    $
    523,738
    
    
    $
    376,156
    
    
    $
    375,680
    
    
    $
    357,082
    
    
    $
    368,335Working capital
    
    
    279,201
    
    
    
    147,318
    
    
    
    157,547
    
    
    
    128,960
    
    
    
    119,868Stockholders equity
    
    
    405,550
    
    
    
    293,087
    
    
    
    293,738
    
    
    
    265,865
    
    
    
    292,570Cash dividends declared (f)
    
    
    21,662
    
    
    
    20,883
    
    
    
    19,112
    
    
    
    33,765
    
    
    
    5,177
 
 (a)
    
    Other items include: special charges of $8.7 million in fiscal 2007 comprised of: $4.7 million for the workforce reductions in Genisphere,
Corporate and the European sales organization, Genisphere goodwill impairment of $2.3 million and ethics line inquiry expenses of $1.7 million and
special charges in fiscal 2005 related to write-downs of investments in two medical technology companies, discontinued development projects and
severance charges.(b)
    
    Dividend income in fiscal 2007 and 2006 was related to a special dividend from a preferred stock investment.(c)
    
    Gain on sale of investments related to sale of the Masimo investment in fiscal 2008; in fiscal 2007 related to sale of an investment that was
impaired in fiscal 2002.(d)
    
    Net (loss) earnings from discontinued operations relates to the PM and IP businesses.(e)
    
    Net gain on sale of discontinued operations relates to sale of the PM business in May 2008. 24




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(f)
    
    In fiscal 2008, the company declared a special dividend of $1.00 per share, or $15.4 million, paid on October 15, 2007
to stockholders of record as of October 1, 2007. In fiscal 2007, the Company declared a special dividend of $1.00 per share, or $15.3 million,
paid on October 6, 2006 to stockholders of record as of September 28, 2006. In fiscal 2006, the Company declared a special dividend of $1.00
per share, or $14.9 million, which was paid on January 18, 2006 to holders of record on December 27, 2005. In fiscal 2005, the Company
declared a special dividend of $2.00 per share, or $29.6 million, which was paid on October 8, 2004 to holders of record on September 30,
2004. In fiscal 2004, the Company declared a special dividend of $0.15 per share, or
$2.2 million, which was paid on October 1, 2003 to holders of record on September 2, 2003. 
 Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
 Overview
       25




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Results of Operations
 Financial Summary
  (Dollars in millions, except per share data)Year ended June 30,2008
    
    2007
    
    2006Net earnings from continuing operations
    
    $
    33.8
    
    
    $
    18.3
    
    
    $
    24.7Earnings per share from continuing
operations, diluted
    
    $
    2.16
    
    
    $
    1.19
    
    
    $
    1.62
 26




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Net Earnings from Continuing Operations
   Net Loss from Discontinued Operations
  Gain on sale of Discontinued Operations
  Comparison of Results (Continuing Operations)  Fiscal 2008 vs. Fiscal 2007
 Net Sales (Sales)
  Sales by Product Line(Dollars in millions)Year ended June 30,2008
    
    2007
    
    2006Cardiac Assist Products Segment
    
    $
    189.3
    
    
    $
    178.3
    
    
    $
    164.8% change from prior year
    
    
    6
    %
    
    
    8
    %
    
    
    16
    %% of total sales
    
    
    82
    %
    
    
    83
    %
    
    
    83
    %Vascular Products Segment
    
    $
    40.3
    
    
    $
    33.5
    
    
    $
    30.1% change from prior year
    
    
    20
    %
    
    
    11
    %
    
    
    (15
    )%% of total sales
    
    
    17
    %
    
    
    16
    %
    
    
    16
    %Corporate and OtherGenisphere
    
    $
    1.3
    
    
    $
    1.2
    
    
    $
    1.6% change from prior year
    
    
    
    
    
    
    
    
    
    
    % of total sales
    
    
    1
    %
    
    
    1
    %
    
    
    Total sales
    
    $
    230.9
    
    
    $
    213.0
    
    
    $
    196.5% change from prior year
    
    
    8
    %
    
    
    8
    %
    
    
    10
    %
 27




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##### Table of Contents



Cardiac Assist
       Vascular Products
  Genisphere
 28




---



##### Table of Contents



Costs and Expenses
 Gross Profit (Net Sales Less Cost of Sales)
  Research and Development (R&D)
     Selling, General and Administrative (SG&A)
     29




---



##### Table of Contents



Special Charges
 Fiscal 2007
 Workforce Reductions in the European Sales Organization , Genisphere and Corporate
  Genisphere Goodwill Impairment
  Inquiry Expenses
    Interest Income
  Other, Net
  Gain
on Sale of Investments
 30




---



##### Table of Contents



Income Taxes
  Comparison of Results (Continuing Operations)  Fiscal 2007 vs. Fiscal 2006
 Sales
 Cardiac Assist
    Vascular Products
   31




---



##### Table of Contents



Genisphere
  Costs and Expenses
 Gross Profit (Net Sales Less Cost of Sales)
  Research and Development (R&D)
     Selling, General and Administrative (SG&A)
     32




---



##### Table of Contents



Special Charges
 Fiscal 2007
 Workforce Reductions in European Sales Organization, Corporate and Genisphere
  Genisphere Goodwill Impairment
  Inquiry Expenses
    Fiscal 2006
  Interest Income
  Dividend Income
 33




---



##### Table of Contents



Other, Net
  Income Taxes
  Liquidity and Capital Resources
 Fiscal 2008 vs. Fiscal 2007
       34




---



##### Table of Contents



Subsequent Event
  Fiscal 2007 vs. Fiscal 2006
   35




---



##### Table of Contents



Payments due by Period(Dollars in millions)Less than
    
    
    1-3
    
    
    3-5
    
    
    More thanTotal
    
    
    1 year
    
    
    years
    
    
    years
    
    
    5 yearsOperating lease obligations
    
    $
    8.5
    
    
    $
    3.5
    
    
    $
    4.2
    
    
    $
    0.8
    
    
    $
    Purchase commitments (1)
    
    
    4.7
    
    
    
    4.7
    
    
    
    
    
    
    
    
    
    
    
    Benefit plan payments (2)
    
    
    53.6
    
    
    
    2.3
    
    
    
    10.9
    
    
    
    11.0
    
    
    
    29.4Unrecognized tax benefits (3)
    
    
    0.2
    
    
    
    0.2
    
    
    
    
    
    
    
    
    
    
    
    Other (4)
    
    
    1.0
    
    
    
    0.5
    
    
    
    0.5
    
    
    
    
    
    
    
    Total contractual obligations and
other commitments
    
    $
    68.0
    
    
    $
    11.2
    
    
    $
    15.6
    
    
    $
    11.8
    
    
    $
    29.4
 
 (1)
    
    These amounts include non-cancelable purchase commitments for inventory and capital expenditures that meet our
projected requirements over the related terms and are in the normal course of business.(2)
    
    Represents expected benefit payments under the U.S and International defined benefit pension plans, the supplemental
executive retirement plan and the post-retirement medical benefits plan.(3)
    
    Represents managements estimate of the current portion of unrecognized tax benefits. This amount excludes the noncurrent portion of unrecognized tax benefits of $4.8 million, for which the period of cash settlement cannot be reasonably estimated.(4)
    
    Represents guaranteed milestone payments to X-Site. Off-Balance Sheet Arrangements
  Critical Accounting Policies and Estimates
  36




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##### Table of Contents



Revenue Recognition 
 Allowance for Doubtful Accounts 
 Inventory Valuation 
 Income Taxes 
   37




---



##### Table of Contents



Accounting for Uncertainty in Income Taxes
 Pension Plan Actuarial Assumptions 
 Recent Accounting Pronouncements
 Accounting for Uncertainty in Income Taxes Accounting for
Income Taxes
 , Fair Value Measurements Effective Date of FASB
Statement No. 157
 Employers Accounting for Defined
Benefit Pension and Other Postretirement Plans .
 38




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##### Table of Contents



Considering the Effects of Prior
Year Misstatements when Quantifying Misstatements in Current Year Financial Statements
 Accounting for
Deferred Compensation and Postretirement Benefits Aspects of Collateral Assignment Split-Dollar
Life Insurance Arrangements Employers Accounting for Postretirement Benefits Other Than Pensions Omnibus Opinion
 The Fair Value Option for Financial Assets and
Financial Liabilities  Including an amendment of FASB Statement No. 115
 39




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##### Table of Contents



Noncontrolling Interests in
Consolidated Financial Statements  an amendment of ARB No. 51
 Business Combinations
 Disclosures about Derivative
Instruments and Hedging Activities (
 The Hierarchy of Generally
Accepted Accounting Principles
 
 Item 7A. Quantitative and Qualitative Disclosures About Market Risk
    40




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##### Table of Contents



Item 8. Financial Statements and Supplementary Data
  
 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
  
 Item 9A. Controls and Procedures
 Disclosure Controls and Procedures
   Managements Report on Internal Control over Financial Reporting
  
    
    pertain to the maintenance of records that in reasonable detail accurately and fairly
reflect the transactions and dispositions of the assets of the Company;
    
    provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting
principles, and that receipts and expenditures of the Company are being made only in
accordance with authorizations of management and directors of the Company; and
    
    provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of the Companys assets that could have a material effect
on the financial statements.
   41




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##### Table of Contents



Internal
Control-Integrated Framework
   Changes in Internal Control over Financial Reporting
  42




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##### Table of Contents



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

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

We have audited the internal control over financial reporting of Datascope
Corp. and subsidiaries (the Company) as of June 30, 2008, based on criteria
established in Internal Control Integrated Frameworkissued by the Committee
of Sponsoring Organizations of the Treadway Commission. The Companys
management is responsible for maintaining effective internal control over
financial reporting and for its assessment of the effectiveness of internal
control over financial reporting, included in the accompanying Managements
Report on Internal Control over Financial Reporting. Our responsibility is to
express an opinion on the Companys internal control over financial reporting
based on our audit.

We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether
effective internal control over financial reporting was maintained in all
material respects. Our audit included obtaining an understanding of internal
control over financial reporting, assessing the risk that a material weakness
exists, testing and evaluating the design and operating effectiveness of
internal control based on the assessed risk, and performing such other
procedures as we considered necessary in the circumstances. We believe that
our audit provides a reasonable basis for our opinion.

A companys internal control over financial reporting is a process designed by,
or under the supervision of, the companys principal executive and principal
financial officers, or persons performing similar functions, and effected by
the companys board of directors, management, and other personnel to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
generally accepted accounting principles. A companys internal control over
financial reporting includes those policies and procedures that (1) pertain to
the maintenance of records that, in reasonable detail, accurately and fairly
reflect the transactions and dispositions of the assets of the company; (2)
provide reasonable assurance that transactions are recorded as necessary to
permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures of the
company are being made only in accordance with authorizations of management and
directors of the company; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use, or disposition
of the companys assets that could have a material effect on the financial
statements.

Because of the inherent limitations of internal control over financial
reporting, including the possibility of collusion or improper management
override of controls, material misstatements due to error or fraud may not be
prevented or detected on a timely basis. Also, projections of any evaluation
of the effectiveness of the internal control over financial reporting to future
periods are subject to the risk that the controls may become inadequate because
of changes in conditions, or that the degree of compliance with the policies or
procedures may deteriorate.

In our opinion, the Company maintained, in all material respects, effective
internal control over financial reporting as of June 30, 2008, based on the
criteria established in Internal Control Integrated Frameworkissued by the
Committee of Sponsoring Organizations of the Treadway Commission.

We have also audited, in accordance with the standards of the Public Company
Accounting Oversight Board (United States), the consolidated financial
statements and financial statement schedule as of and for the year ended June
30, 2008 of the Company and our report dated September 15, 2008 expressed an
unqualified opinion on those financial statements and financial statement
schedule and included an explanatory paragraph regarding the Companys adoption
of Statement of Financial Accounting Standards No. 158, Employers
Accounting for Defined Benefit Pension and Other Postretirement Plans,
effective June 30, 2007, the provisions of United States Securities and
Exchange Commission Staff Accounting Bulletin No. 108, Considering the Effects
of Prior Year Misstatements when Quantifying Misstatements in Current Year
Financial Statements, effective for the year ended June 30, 2007, and the
provisions of Financial Accounting Standards Board Interpretation No. 48,
Accounting for Uncertainty in Income Taxes, effective July 1, 2007.

/s/ Deloitte & Touche LLP

Parsippany, New Jersey

September 15, 2008

43



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##### Table of Contents



Item 9B. Other Information
  
 PART III
 
 Item 10. Directors, Executive Officers and Corporate Governance
  
 Item 11. Executive Compensation
  
 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters
   Number of securitiesremaining available forNumber of securities to
    
    Weighted average exercise
    
    future issuance under equitybe issued upon exercise
    
    price of outstanding
    
    compensation plansof outstanding options,
    
    options, warrants and
    
    (excluding securitiesPlan Category
    
    warrants and rights
    
    rights
    
    reflected in column (a))(a)
    
    (b)
    
    (c)Equity compensation plans
approved by security
holders (1)Stock options
    
    
    1,030,500
    
    
    $
    31.87
    
    
    
    716,317Common stock (2)
    
    
    64,687
    
    
    
    
    
    
    
    1,126,135Equity compensation plans
not approved by security
holders (3)Stock options
    
    
    15,000
    
    
    $
    32.19
    
    
    
    Total
    
    
    1,110,187
    
    
    
    
    
    
    
    1,842,452
 
 (1)
    
    See Note 10 to the Consolidated Financial Statements for a description of our stock-based plans.(2)
    
    Includes 4,597 shares of restricted stock granted to members of the Board of Directors in fiscal 2008 under the 2005
Equity Incentive Plan, pursuant to the Compensation Plan for Non-Employee Directors.(3)
    
    Includes grants of options to a member of the Board of Directors to purchase up to 15,000 shares of our common stock.
These options have a term of 10 years with exercise prices ranging from $22.49 to $37.03. 
 Item 13. Certain Relationships and Related Transactions, and Director Independence
  
 Item 14. Principal Accountant Fees and Services
 44




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##### Table of Contents



PART IV
 
 Item 15. Exhibits and Financial Statement Schedules
   PageReport of Independent Registered Public Accounting Firm
    
    
    F-1Consolidated balance sheets June 30, 2008 and 2007
    
    
    F-2Consolidated statements of earnings Years ended June 30, 2008, 2007 and 2006
    
    
    F-3Consolidated statements of stockholders equity Years ended June 30, 2008, 2007 and 2006
    
    
    F-4Consolidated statements of cash flows Years ended June 30, 2008, 2007 and 2006
    
    
    F-5Notes to consolidated financial statements
    
    
    F-6-F-43
  Schedule II Valuation and Qualifying Accounts
    
    
    S-1
   Exhibit No.
    
    Document Description2.1
    
    Asset Purchase Agreement dated March 10, 2008, by and between Datascope Corp.
and Mindray Medical International Limited, incorporated by reference to
Exhibit 10.1 to the registrants Current Report on Form 8-K filed on March
15, 2008.3.1
    
    Exhibit 3.1 Amended and Restated Bylaws of Datascope Corp., incorporated by
reference to the registrants Current Report on Form 8-K filed on December
21, 2007.3.2
    
    By-Laws, incorporated by reference to Exhibit 3.1 to Current Report on Form
8-K dated September 27, 2004.4.1
    
    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.
 45




---



##### Table of Contents



Exhibit No.
    
    Document Description4.4
    
    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 Annex B to the Companys Proxy Statement on Schedule 14A filed by the
Company on October 28, 2004.10.3
    
    Datascope Corp. 1997 Executive Bonus Plan, incorporated by reference to
Exhibit 10.2 to Quarterly Report on Form 10-Q for the quarter ended December
31, 1997 (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. Amended and Restated Compensation Plan for Non-Employee
Directors, incorporated by reference to Annex A to the Companys Proxy
Statement on Schedule 14A filed by the Company on October 28, 2002.10.6
    
    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, 1997.10.7
    
    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 June 20, 2000 Form S-8).10.12
    
    Stock Option Agreement between the Company and Thor W. Nilsen, incorporated
by reference to Exhibit 4.2 of the June 20, 2000 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 June 20, 2000 Form S-8.10.14
    
    Stock Option Agreement between the Company and Robert Getts, Ph.D., James
Kadushin and William Ohley, Ph.D., incorporated by reference to Exhibit 4.4
of the June 20, 2000 Form S-8.10.15
    
    Stock Option Agreement between the Company and Arno Nash and Alan Abramson,
incorporated by reference to Exhibit 4.5 of the June 20, 2000 Form S-8.10.16
    
    Stock Option Agreement between the Company and David Altschiller,
incorporated by reference to Exhibit 4.7 of the June 20, 2000 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 to Exhibit
10.22 of the Companys Annual Report on Form 10-K for fiscal year ended June
30, 2000.
 46




---



##### Table of Contents



Exhibit No.
    
    Document Description10.18
    
    Series G Preferred Stock Purchase Agreement, dated as of September 14, 2001,
by and between Masimo Corporation and Datascope Corp., incorporated by
reference to Exhibit 10.19 to the Companys Annual Report on Form 10-K for
fiscal year ended June 30, 2002 (the 2002 10-K).10.19
    
    Second Amendment to Employment Agreement, dated as of October 31, 2001, by
and between Datascope Corp. and Lawrence Saper, incorporated by reference to
Exhibit 10.20 of the 2002 10-K.10.20
    
    Stock Option Agreement between the Company and William L. Asmundson,
incorporated by reference to Exhibit 10.1 of the Registration Statement on
Form S-8, filed with the Commission on December 19, 2001 (the December 19,
2001 Form S-8).10.21
    
    Stock Option Agreement between the Company and Jorgen K. Winther,
incorporated by reference to Exhibit 10.2 of the December 19, 2001 Form S-8.10.22
    
    Third Amendment to Employment Agreement, dated as of March 13, 2002, by and
between Datascope Corp. and Lawrence Saper, incorporated by reference to
Exhibit 10.23 of the 2002 10-K.10.23
    
    Fourth Amendment to Employment Agreement, dated as of October 1, 2002, by and
between Datascope Corp. and Lawrence Saper, incorporated by reference to
Exhibit 10.23 to the Companys Annual Report on Form 10-K for fiscal year
ended June 30, 2004 (the 2004 10-K).10.24
    
    Stock Option Agreement between the Company and David Altschiller, dated
February 25, 2003 incorporated by reference to Exhibit 4.2 of the
Registration Statement on Form S-8, filed with the Commission on May 30, 2003
(the May 30, 2003 Form S-8).10.25
    
    Stock Option Agreement between the Company and Dr. Samuel Money, incorporated
by reference to Exhibit 4.3 of the May 30, 2003 Form S-8.10.26
    
    Stock Option Agreement between the Company and Leonard Gottlieb, dated May
20, 2003, incorporated by reference to Exhibit 10.23 to the 2004 10-K.10.27
    
    Datascope Corp. 2004 Management Incentive Plan, incorporated by reference to
Annex A to the Companys Proxy Statement on Schedule 14A filed by the Company
on October 28, 2003.10.28
    
    Fifth Amendment to Employment Agreement, dated as of April 1, 2005, by and
between Datascope Corp. and Lawrence Saper, incorporated by reference to
Exhibit 10.28 to the Companys Annual Report on Form 10-K for fiscal year
ended June 30, 2005.21.1*
    
    Subsidiaries of the Company.23.1*
    
    Consent of Deloitte & Touche LLP.31.1*
    
    Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a).31.2*
    
    Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a).32.1*
    
    Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
 
 *
    
    Filed herewith. 47




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##### Table of Contents



SIGNATURES
  DATASCOPE CORP.Date:  September 15, 2008
    By:
    /s/ Lawrence SaperLawrence SaperChairman of the Board
and Chief Executive Officer  Signature
    
    Title
    
    Date/s/ Lawrence Saper
Lawrence Saper
    
    Chairman of the Board
and Chief Executive
Officer (Principal
Executive Officer)
    
    September 15, 2008/s/ Antonino Laudani, M.D.

Antonino Laudani, M.D.
    
    Vice-President and Chief Operating Officer
    
    September 15, 2008/s/ Henry M. Scaramelli

Henry M. Scaramelli
    
    Vice President, Finance
and Chief Financial
Officer (Principal
Financial Officer)
    
    September 15, 2008/s/ Fred Adelman
Fred Adelman
    
    Vice President, Chief
Accounting Officer
(Principal Accounting
Officer) and Treasurer
    
    September 15, 2008/s/ Alan B. Abramson

Alan B. Abramson
    
    Director
    
    September 15, 2008/s/ David Altschiller
David Altschiller
    
    Director
    
    September 15, 2008/s/ David Dantzker, M.D.

David Dantzker, M.D.
    
    Director
    
    September 15, 2008/s/ James J. Loughlin

James J. Loughlin
    
    Director
    
    September 15, 2008/s/ Robert E. Klatell

Robert E. Klatell
    
    Director
    
    September 15, 2008/s/ William W. Wyman

William W. Wyman
    
    Director
    
    September 15, 2008
 48




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##### Table of Contents



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
    Employers Accounting for Defined Benefit
Pension and Other Postretirement Plans Considering the Effects of
Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements Accounting for Uncertainty in Income Taxes
 Internal Control  Integrated Framework
  
 F-1




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 
 CONSOLIDATED BALANCE SHEETS
(In thousands, except per share amounts)
 June 30,2008
    
    
    2007AssetsCurrent assets:Cash and cash equivalents
    
    $
    22,106
    
    
    $
    15,780Short-term investments
    
    
    228,106
    
    
    
    23,681Accounts receivable less allowance for
doubtful accounts of $2,777 and $2,603
    
    
    65,178
    
    
    
    85,553Inventories
    
    
    31,030
    
    
    
    59,455Prepaid income taxes
    
    
    
    
    
    
    2,293Prepaid expenses and other current assets
    
    
    16,425
    
    
    
    11,167Current deferred taxes
    
    
    2,476
    
    
    
    7,238Current assets of discontinued operations
    
    
    5,773
    
    
    
    Total current assets
    
    
    371,094
    
    
    
    205,167Property, plant and equipment, net
    
    
    49,710
    
    
    
    82,812Long-term investments
    
    
    22,846
    
    
    
    14,346Intangible assets, net
    
    
    15,873
    
    
    
    26,074Goodwill
    
    
    4,575
    
    
    
    12,860Other assets
    
    
    43,974
    
    
    
    34,897Noncurrent assets of discontinued operations
    
    
    15,666
    
    
    
    $
    523,738
    
    
    $
    376,156Liabilities and Stockholders EquityCurrent liabilities:Accounts payable
    
    $
    16,951
    
    
    $
    18,386Accrued expenses
    
    
    13,833
    
    
    
    17,661Accrued compensation
    
    
    14,377
    
    
    
    17,422Deferred revenue
    
    
    2,728
    
    
    
    4,380Income taxes payable
    
    
    43,504
    
    
    
    Current liabilities of discontinued operations
    
    
    500
    
    
    
    Total current liabilities
    
    
    91,893
    
    
    
    57,849Other liabilities
    
    
    25,836
    
    
    
    25,220Other liabilities of discontinued operations
    
    
    459
    
    
    
    Commitments and contingencies (Note 13)Stockholders equity:Preferred stock, par value $1.00 per share:Authorized 5,000 shares; Issued, none
    
    
    
    
    
    
    Common stock, par value $0.01 per share:Authorized, 45,000 shares;Issued, 19,401 and 18,867 shares
    
    
    194
    
    
    
    189Additional paid-in capital
    
    
    126,805
    
    
    
    109,384Treasury stock at cost, 3,567 and 3,521 shares
    
    
    (108,897
    )
    
    
    (107,037
    )Retained earnings
    
    
    377,194
    
    
    
    294,765Accumulated other comprehensive income (loss):Cumulative translation adjustments
    
    
    10,043
    
    
    
    1,899Benefit plan adjustments
    
    
    (55
    )
    
    
    (5,827
    )Unrealized gain (loss) on available-for-sale securities
    
    
    266
    
    
    
    (286
    )Total stockholders equity
    
    
    405,550
    
    
    
    293,087$
    523,738
    
    
    $
    376,156
  F-2




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF EARNINGS
(In thousands, except per share amounts)
 Year Ended June 30,2008
    
    
    2007
    
    
    2006Net sales
    
    $
    230,915
    
    
    $
    212,991
    
    
    $
    196,516Cost of sales
    
    
    80,013
    
    
    
    74,148
    
    
    
    68,320Gross profit
    
    
    150,902
    
    
    
    138,843
    
    
    
    128,196Operating expenses:Research and development expenses
    
    
    21,079
    
    
    
    19,901
    
    
    
    19,129Selling, general and administrative expenses
    
    
    92,617
    
    
    
    87,424
    
    
    
    81,152Special
charges
    
    
    
    
    
    
    8,737
    
    
    
    113,696
    
    
    
    116,062
    
    
    
    100,281Operating earnings
    
    
    37,206
    
    
    
    22,781
    
    
    
    27,915Other (income) expense:Interest income
    
    
    (2,698
    )
    
    
    (2,479
    )
    
    
    (2,225
    )Interest expense
    
    
    84
    
    
    
    36
    
    
    
    228Dividend income
    
    
    
    
    
    
    (196
    )
    
    
    (4,523
    )Gain on sale of investments
    
    
    (13,173
    )
    
    
    (1,273
    )
    
    
    Other, net
    
    
    1,727
    
    
    
    737
    
    
    
    1,414(14,060
    )
    
    
    (3,175
    )
    
    
    (5,106
    )Earnings from continuing operations before income taxes
    
    
    51,266
    
    
    
    25,956
    
    
    
    33,021Income taxes
    
    
    17,488
    
    
    
    7,662
    
    
    
    8,289Net earnings from continuing operations
    
    
    33,778
    
    
    
    18,294
    
    
    
    24,732Net (loss) earnings from discontinued operations
    
    
    (3,544
    )
    
    
    (829
    )
    
    
    1,111Net gain on sale of discontinued operations
    
    
    76,672
    
    
    
    
    
    
    
    Net earnings
    
    $
    106,906
    
    
    $
    17,465
    
    
    $
    25,843Net earnings (loss) per share, basic:Continuing operations
    
    $
    2.19
    
    
    $
    1.20
    
    
    $
    1.65Discontinued operations
    
    
    (0.23
    )
    
    
    (0.05
    )
    
    
    0.08Net gain on sale of discontinued operations
    
    
    4.96
    
    
    
    
    
    
    
    Net earnings
    
    $
    6.92
    
    
    $
    1.15
    
    
    $
    1.73Weighted average number of
common shares outstanding, basic
    
    
    15,441
    
    
    
    15,244
    
    
    
    14,974Net earnings (loss) per share, diluted:Continuing operations
    
    $
    2.16
    
    
    $
    1.19
    
    
    $
    1.62Discontinued operations
    
    
    (0.22
    )
    
    
    (0.05
    )
    
    
    0.07Net gain on sale of discontinued operations
    
    
    4.91
    
    
    
    
    
    
    
    Net earnings
    
    $
    6.85
    
    
    $
    1.14
    
    
    $
    1.69Weighted average number of
common shares outstanding, diluted
    
    
    15,617
    
    
    
    15,387
    
    
    
    15,296
  F-3




---



##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY
(In thousands, except per share amounts)
 AccumulatedOther Com-Common Stock
    
    
    Additional
    
    
    Treasury Stock
    
    
    
    
    
    
    prehensivePar
    
    
    Paid-in
    
    
    
    
    
    
    
    
    
    
    Retained
    
    
    IncomeShares
    
    
    Value
    
    
    Capital
    
    
    Shares
    
    
    Cost
    
    
    Earnings
    
    
    (Loss)
    
    
    TotalBalance, June 30, 2005
    
    
    18,256
    
    
    $
    183
    
    
    $
    88,773
    
    
    
    (3,460
    )
    
    $
    (105,175
    )
    
    $
    292,524
    
    
    $
    (10,440
    )
    
    $
    265,865Net earnings
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    25,843
    
    
    
    
    
    
    
    25,843Minimum pension liability
adjustments, net of tax of ($3,498)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,066
    
    
    
    5,066Foreign currency translation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,413
    
    
    
    1,413Unrealized loss on available-for-sale securities, net of tax
of $98
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (152
    )
    
    
    (152
    )Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    32,170Common stock transactions
    
    
    475
    
    
    
    4
    
    
    
    13,821
    
    
    
    (24
    )
    
    
    (838
    )
    
    
    
    
    
    
    
    
    
    
    12,987Restricted stock awards
    
    
    14
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    558
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    558Tax benefit relating to stock-based
awards
    
    
    
    
    
    
    
    
    
    
    1,414
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,414Cancellation of treasury stock
    
    
    (24
    )
    
    
    
    
    
    
    (838
    )
    
    
    24
    
    
    
    838
    
    
    
    
    
    
    
    
    
    
    
    Common stock repurchased
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5
    )
    
    
    (144
    )
    
    
    
    
    
    
    
    
    
    
    (144
    )Cash dividends declared on common
stock ($1.28 per share)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (19,112
    )
    
    
    
    
    
    
    (19,112
    )Balance, June 30, 2006
    
    
    18,721
    
    
    
    187
    
    
    
    103,728
    
    
    
    (3,465
    )
    
    
    (105,319
    )
    
    
    299,255
    
    
    
    (4,113
    )
    
    
    293,738Net earnings
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    17,465
    
    
    
    
    
    
    
    17,465Minimum pension liability
adjustments, net of tax of ($1,164)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,686
    
    
    
    1,686Foreign currency translation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,127
    
    
    
    2,127Unrealized gain on available-for-sale securities, net of tax
of ($47)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    90
    
    
    
    90Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    21,368Cumulative effect of SFAS 158
adoption, net of tax of $3,618
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5,076
    )
    
    
    (5,076
    )Cumulative effect of SAB 108
adoption
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,072
    )
    
    
    1,072
    
    
    
    Common stock transactions
    
    
    156
    
    
    
    2
    
    
    
    4,661
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,663Restricted stock awards
    
    
    4
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    695
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    695Tax benefit relating to stock-based
awards
    
    
    
    
    
    
    
    
    
    
    300
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    300Cancellation of restricted stock
awards
    
    
    (14
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Common stock repurchased
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (56
    )
    
    
    (1,718
    )
    
    
    
    
    
    
    
    
    
    
    (1,718
    )Cash dividends declared on common
stock ($1.37 per share)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (20,883
    )
    
    
    
    
    
    
    (20,883
    )Balance, June 30, 2007
    
    
    18,867
    
    
    
    189
    
    
    
    109,384
    
    
    
    (3,521
    )
    
    
    (107,037
    )
    
    
    294,765
    
    
    
    (4,214
    )
    
    
    293,087Net earnings
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    106,906
    
    
    
    
    
    
    
    106,906Benefit plan adjustments, net of
tax of ($3,828)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,772
    
    
    
    5,772Foreign currency translation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,144
    
    
    
    8,144Unrealized gain on available-
for-sale securities, net of tax
of $325
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    552
    
    
    
    552Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    121,374Cumulative effect of FIN 48 adoption
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,815
    )
    
    
    
    
    
    
    (2,815
    )Common stock transactions
    
    
    469
    
    
    
    5
    
    
    
    14,835
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,840Restricted stock awards
    
    
    75
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    1,341
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,341Tax benefit relating to stock-based
awards
    
    
    
    
    
    
    
    
    
    
    1,245
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,245Cancellation of restricted stock
awards
    
    
    (10
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Common stock repurchased
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (46
    )
    
    
    (1,860
    )
    
    
    
    
    
    
    
    
    
    
    (1,860
    )Cash dividends declared on common
stock ($1.40 per share)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (21,662
    )
    
    
    
    
    
    
    (21,662
    )Balance, June 30, 2008
    
    
    19,401
    
    
    $
    194
    
    
    $
    126,805
    
    
    
    (3,567
    )
    
    $
    (108,897
    )
    
    $
    377,194
    
    
    $
    10,254
    
    
    $
    405,550
  F-4




---



##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in thousands)
 Year Ended June 30,2008
    
    
    2007
    
    
    2006Operating Activities:Net earnings
    
    $
    106,906
    
    
    $
    17,465
    
    
    $
    25,843Adjustments to reconcile net earnings to net
cash provided by operating activities:Depreciation
    
    
    12,852
    
    
    
    15,209
    
    
    
    15,162Amortization
    
    
    5,056
    
    
    
    6,279
    
    
    
    5,371Provision for supplemental pension and post-retirement medical
    
    
    1,371
    
    
    
    1,284
    
    
    
    1,164Provision for losses on accounts receivable
    
    
    609
    
    
    
    456
    
    
    
    461Cash surrender value of officers life insurance
    
    
    (249
    )
    
    
    (248
    )
    
    
    (308
    )Net gain on sale of discontinued operations
    
    
    (76,672
    )
    
    
    
    
    
    
    Gains on asset sales
    
    
    
    
    
    
    (2,235
    )
    
    
    (810
    )Realized (gains) losses on sale of investments
    
    
    (13,173
    )
    
    
    (1,268
    )
    
    
    853Stock-based compensation expense
    
    
    1,341
    
    
    
    695
    
    
    
    558Excess tax benefits from stock-based compensation
    
    
    (1,279
    )
    
    
    (350
    )
    
    
    (1,406
    )Deferred income tax expense (benefit)
    
    
    (169
    )
    
    
    (199
    )
    
    
    320Special charges asset write-offs and impairments
    
    
    841
    
    
    
    2,648
    
    
    
    1,614Purchased in-process research and development
    
    
    
    
    
    
    440
    
    
    
    Changes in operating assets and liabilities,
net of business acquisition:Accounts receivable
    
    
    21,602
    
    
    
    (4,892
    )
    
    
    (3,353
    )Inventories
    
    
    (7,480
    )
    
    
    (6,116
    )
    
    
    (11,084
    )Prepaid expenses and other assets
    
    
    (10,632
    )
    
    
    (2,263
    )
    
    
    (4,710
    )Accounts payable
    
    
    2,628
    
    
    
    (2,800
    )
    
    
    627Accrued and other liabilities
    
    
    (9,354
    )
    
    
    2,102
    
    
    
    (1,301
    )Income taxes payable
    
    
    (943
    )
    
    
    
    
    
    
    Net cash provided by operating activities
    
    
    33,255
    
    
    
    26,207
    
    
    
    29,001Investing Activities:Capital expenditures
    
    
    (6,763
    )
    
    
    (5,885
    )
    
    
    (6,255
    )Proceeds from asset sales
    
    
    
    
    
    
    3,000
    
    
    
    2,653Purchases of investments
    
    
    (449,172
    )
    
    
    (73,960
    )
    
    
    (72,010
    )Proceeds from investment maturities
    
    
    230,797
    
    
    
    70,035
    
    
    
    30,596Proceeds from investment sales
    
    
    18,363
    
    
    
    32,103
    
    
    
    28,065Capitalized software
    
    
    (6,876
    )
    
    
    (7,458
    )
    
    
    (4,059
    )Purchased technology and licenses
    
    
    (13
    )
    
    
    (2,157
    )
    
    
    (459
    )Proceeds from sale of discontinued operations, net of cash divested
    
    
    208,603
    
    
    
    
    
    
    
    Business acquisition payment, net of cash acquired
    
    
    (11,056
    )
    
    
    (16,423
    )
    
    
    Other
    
    
    
    
    
    
    (88
    )
    
    
    (88
    )Net cash used in investing activities
    
    
    (16,117
    )
    
    
    (833
    )
    
    
    (21,557
    )Financing Activities:Short-term borrowings
    
    
    
    
    
    
    
    
    
    
    15,200Repayments of short-term borrowings
    
    
    
    
    
    
    
    
    
    
    (19,200
    )Exercise of stock options
    
    
    14,660
    
    
    
    3,988
    
    
    
    12,987Treasury shares acquired under repurchase programs
    
    
    (1,860
    )
    
    
    (1,718
    )
    
    
    (144
    )Excess tax benefits from stock-based compensation
    
    
    1,279
    
    
    
    350
    
    
    
    1,406Cash dividends paid
    
    
    (23,155
    )
    
    
    (20,389
    )
    
    
    (19,079
    )Guaranteed milestone payments
    
    
    (500
    )
    
    
    (500
    )
    
    
    (500
    )Net cash used in financing activities
    
    
    (9,576
    )
    
    
    (18,269
    )
    
    
    (9,330
    )Effect of exchange rates on cash
    
    
    (1,236
    )
    
    
    (804
    )
    
    
    (823
    )Increase (decrease) in cash and cash equivalents
    
    
    6,326
    
    
    
    6,301
    
    
    
    (2,709
    )Cash and cash equivalents, beginning of year
    
    
    15,780
    
    
    
    9,479
    
    
    
    12,188Cash and cash equivalents, end of year
    
    $
    22,106
    
    
    $
    15,780
    
    
    $
    9,479Supplemental Cash Flow InformationCash paid during the year for:Interest
    
    $
    87
    
    
    $
    41
    
    
    $
    246Income taxes paid
    
    $
    15,984
    
    
    $
    11,370
    
    
    $
    8,857Income taxes refunded
    
    $
    3,772
    
    
    $
    3,538
    
    
    $
    3,192Non-cash investing and financing activities:Net transfers of inventory to fixed assets for use as
demonstration equipment
    
    $
    4,989
    
    
    $
    6,809
    
    
    $
    6,518Dividends declared, not paid
    
    $
    70
    
    
    $
    1,563
    
    
    $
    1,069Capitalized software and property, plant & equipment
acquired, not paid
    
    $
    493
    
    
    $
    128
    
    
    $
    477Cancellation of treasury stock
    
    $
    
    
    
    $
    
    
    
    $
    838Proceeds due from broker  common stock transactions
    
    $
    617
    
    
    $
    441
    
    
    $
    Issuance of deferred shares
    
    $
    4
    
    
    $
    234
    
    
    $
    
  F-5




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
 1. Summary of Significant Accounting Policies
 Company Overview
 our us we
   Principles of Consolidation
  Reclassifications
  Use of Estimates
  F-6




---



##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
 Foreign Currency Translation
  Taxes on Income
 Accounting for Income Taxes Accounting for Uncertainty in Income Taxes Accounting for Income Taxes
 Cash and Cash Equivalents
  Investments
  F-7




---



##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
 Allowance for Doubtful Accounts
  Concentration of Credit Risk
  Inventories
  June 30,2008
    
    
    2007Materials
    
    $
    9,999
    
    
    $
    20,189Work in process
    
    
    8,628
    
    
    
    11,253Finished goods
    
    
    12,403
    
    
    
    28,013$
    31,030
    
    
    $
    59,455
 Property, Plant and Equipment
  F-8




---



##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
  June 30,2008
    
    
    2007Land
    
    $
    4,251
    
    
    $
    9,248Buildings
    
    
    37,836
    
    
    
    57,061Machinery, furniture and equipment
    
    
    80,624
    
    
    
    116,787Leasehold improvements
    
    
    562
    
    
    
    476123,273
    
    
    
    183,572Less accumulated depreciation and amortization
    
    
    (73,563
    )
    
    
    (100,760
    )$
    49,710
    
    
    $
    82,812
  Impairment of Long Lived Assets
 Accounting for the Impairment or Disposal of
Long-Lived Assets
 Other Assets
 Capitalized Software Development Costs
 Accounting for the Costs of Computer Software to be Sold,
Leased, or Otherwise Marketed
 Internal Use Capitalized Computer Software Costs
 Accounting for the Costs of Computer Software Developed or Obtained for Internal
Use
 F-9




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
 Intangible Assets
  Goodwill
  Revenue Recognition
  Earnings Per Share
 Earnings Per Share
 Stock-Based Compensation
 F-10




---



##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
 Share-Based Payment
 Recently Adopted Accounting Pronouncements
 Accounting for Uncertainty in Income Taxes Accounting for Income Taxes
 Employers Accounting for Defined
Benefit Pension and Other Postretirement Plans .
 F-11




---



##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
 Considering the Effects of Prior
Year Misstatements when Quantifying Misstatements in Current Year Financial Statements
 Recent Accounting Pronouncements, Not Required to be Adopted as of June 30, 2008
 Fair Value Measurements Effective Date of FASB Statement No. 157
 Accounting for
Deferred Compensation and Postretirement Benefits Aspects of Collateral Assignment Split-Dollar
Life Insurance Arrangements Employers Accounting for Postretirement Benefits Other Than Pensions Omnibus Opinion
 F-12




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
 The Fair Value Option for Financial Assets and
Financial Liabilities  Including an amendment of FASB Statement No. 115
 Noncontrolling Interests in Consolidated
Financial Statements  an amendment of ARB No. 51
 Business Combinations
 Disclosures about Derivative Instruments and
Hedging Activities (
 The Hierarchy of Generally Accepted Accounting
Principles
 F-13




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
 2. Financial Instruments and Investments
   Gross UnrealizedCost
    
    
    Gains
    
    
    Losses
    
    
    Fair ValueShort-termU.S. treasury and agency securities
    
    $
    205,232
    
    
    $
    97
    
    
    $
    7
    
    
    $
    205,322Foreign government treasury securities
    
    
    7,967
    
    
    
    
    
    
    
    
    
    
    
    7,967Guaranteed Euro deposits
    
    
    14,611
    
    
    
    
    
    
    
    
    
    
    
    14,611Corporate equity security
    
    
    26
    
    
    
    180
    
    
    
    
    
    
    
    206Short-term total
    
    $
    227,836
    
    
    $
    277
    
    
    $
    7
    
    
    $
    228,106Long-termU.S. treasury and agency securities
    
    $
    20,645
    
    
    $
    173
    
    
    $
    79
    
    
    $
    20,739AAARated corporate notes
    
    
    2,031
    
    
    
    76
    
    
    
    
    
    
    
    2,107Long-term total
    
    $
    22,676
    
    
    $
    249
    
    
    $
    79
    
    
    $
    22,846Totals
    
    $
    250,512
    
    
    $
    526
    
    
    $
    86
    
    
    $
    250,952
   F-14




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
  Gross UnrealizedCost
    
    
    Gains
    
    
    Losses
    
    
    Fair ValueShort-termU.S. treasury and agency securities
    
    $
    23,942
    
    
    $
    2
    
    
    $
    263
    
    
    $
    23,681Long-termU.S. treasury and agency securities
    
    $
    6,105
    
    
    $
    
    
    
    $
    201
    
    
    $
    5,904AAARated corporate notes
    
    
    2,062
    
    
    
    26
    
    
    
    
    
    
    
    2,088Preferred stock
    
    
    5,000
    
    
    
    
    
    
    
    
    
    
    
    5,000Call option
    
    
    1,354
    
    
    
    
    
    
    
    
    
    
    
    1,354Long-term total
    
    $
    14,521
    
    
    $
    26
    
    
    $
    201
    
    
    $
    14,346Totals
    
    $
    38,463
    
    
    $
    28
    
    
    $
    464
    
    
    $
    38,027
      Available-for-Sale
    
    Fair ValueDue within one year
    
    $
    227,900Due after one year through five years
    
    
    22,846$
    250,746
 F-15




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
 Derivative Financial Instruments
     3. Discontinued Operations
   F-16




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
  Year Ending June 30,2008
    
    
    2007
    
    
    2006Net sales:Patient Monitoring business
    
    $
    134,160
    
    
    $
    156,501
    
    
    $
    159,402Interventional Products business
    
    
    4,163
    
    
    
    9,308
    
    
    
    17,082Net sales from discontinued operations
    
    $
    138,323
    
    
    $
    165,809
    
    
    $
    176,484Pretax (loss) earnings:Patient Monitoring business
    
    $
    (5,772
    )
    
    $
    3,562
    
    
    $
    11,815Interventional Products business
    
    
    506
    
    
    
    (4,915
    )
    
    
    (10,347
    )Pretax (loss) earnings from discontinued operations
    
    $
    (5,266
    )
    
    $
    (1,353
    )
    
    $
    1,468
  Inventories (current assets of discontinued operations)
    
    $
    5,773Property, plant and equipment, net of
accumulated depreciation of $2,813
    
    $
    2,253Intangible assets, net
    
    
    13,413Noncurrent assets of discontinued operations
    
    $
    15,666Accrued expenses (current liabilities of discontinued operations)
    
    $
    500Other liabilities of discontinued operations
    
    $
    459
 4. Acquisitions
  F-17




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
  Weighted AverageAmortizationCost
    
    
    PeriodIntangible assets:Purchased technology
    
    $
    8,886
    
    
    9.8 yearsCustomer relationships and other
    
    
    2,124
    
    
    6.6 yearsTrademark
    
    
    529
    
    
    7.0 yearsGoodwill
    
    
    2,762
    
    
    Total assets acquired
    
    $
    14,301
   5. Intangible Assets
 June 30,2008
    
    
    2007Amortized intangible assets:Purchased technology
    
    $
    14,612
    
    
    $
    22,176Licenses
    
    
    390
    
    
    
    5,272Customer relationships and other
    
    
    2,685
    
    
    
    1,077Subtotal
    
    
    17,687
    
    
    
    28,525Accumulated amortization:Purchased technology
    
    
    (1,540
    )
    
    
    (1,300
    )Licenses
    
    
    (265
    )
    
    
    (1,512
    )Customer relationships and other
    
    
    (9
    )
    
    
    (12
    )Subtotal
    
    
    (1,814
    )
    
    
    (2,824
    )Amortized intangible assets, net
    
    $
    15,873
    
    
    $
    25,701Indefinite-lived intangible assets:Trade name
    
    $
    
    
    
    $
    373
  F-18




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
   Year Ending June 30,2009
    
    2010
    
    2011
    
    2012
    
    2013Amortization expense
    
    $
    1,773
    
    
    $
    1,773
    
    
    $
    1,773
    
    
    $
    1,773
    
    
    $
    1,759
  6. Goodwill
   7. Other Assets
 June 30,2008
    
    
    2007Capitalized software, net of accumulated
amortization of $5,391 and $20,975
    
    $
    11,830
    
    
    $
    20,173Cash surrender value of officers life insurance
    
    
    12,402
    
    
    
    12,153Non-current pension asset
    
    
    17,127
    
    
    
    1,261Non-current deferred tax assets
    
    
    1,251
    
    
    
    249Other non-current assets
    
    
    1,364
    
    
    
    1,061$
    43,974
    
    
    $
    34,897
  F-19




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
 8. Income Taxes
  Year Ended June 30,2008
    
    
    2007
    
    
    2006U.S.
    
    $
    43,498
    
    
    $
    10,842
    
    
    $
    18,775Foreign
    
    
    7,768
    
    
    
    15,114
    
    
    
    14,246Earnings before income taxes
    
    $
    51,266
    
    
    $
    25,956
    
    
    $
    33,021
  Year Ended June 30,2008
    
    
    2007
    
    
    2006Current income taxes:Federal
    
    $
    9,167
    
    
    $
    4,175
    
    
    $
    5,802State
    
    
    1,491
    
    
    
    1,797
    
    
    
    1,736Foreign
    
    
    2,247
    
    
    
    1,913
    
    
    
    585Total current
    
    
    12,905
    
    
    
    7,885
    
    
    
    8,123Deferred income taxes:Federal
    
    
    4,490
    
    
    
    235
    
    
    
    (242
    )State
    
    
    (601
    )
    
    
    (48
    )
    
    
    320Foreign
    
    
    694
    
    
    
    (410
    )
    
    
    88Total deferred
    
    
    4,583
    
    
    
    (223
    )
    
    
    166Total income taxes
    
    $
    17,488
    
    
    $
    7,662
    
    
    $
    8,289
     F-20




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
  Year Ended June 30,2008
    
    
    2007
    
    
    2006Effective
    
    
    
    
    
    
    Effective
    
    
    
    
    
    
    EffectiveAmount
    
    
    Rate
    
    
    Amount
    
    
    Rate
    
    
    Amount
    
    
    RateTax computed at Federal statutory rate
    
    $
    17,943
    
    
    
    35.0
    %
    
    $
    9,085
    
    
    
    35.0
    %
    
    $
    11,557
    
    
    
    35.0
    %(Decrease) increase resulting from:Benefit from extraterritorial
income exclusion
    
    
    
    
    
    
    
    
    
    
    (373
    )
    
    
    (1.4
    )
    
    
    (1,173
    )
    
    
    (3.5
    )State income taxes, net of Federal
income tax benefit
    
    
    780
    
    
    
    1.5
    
    
    
    1,018
    
    
    
    3.9
    
    
    
    1,055
    
    
    
    3.2Rate differential on foreign income
    
    
    (487
    )
    
    
    (1.0
    )
    
    
    (1,237
    )
    
    
    (4.7
    )
    
    
    (1,973
    )
    
    
    (6.0
    )Domestic manufacturing deduction
    
    
    (622
    )
    
    
    (1.2
    )
    
    
    (146
    )
    
    
    (0.6
    )
    
    
    (93
    )
    
    
    (0.3
    )Research and development credit, net
    
    
    (169
    )
    
    
    (0.3
    )
    
    
    (355
    )
    
    
    (1.4
    )
    
    
    (248
    )
    
    
    (1.0
    )Repatriation of foreign earnings
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    175
    
    
    
    0.8Special dividend income
    
    
    (67
    )
    
    
    (0.1
    )
    
    
    (48
    )
    
    
    (0.2
    )
    
    
    (1,108
    )
    
    
    (3.4
    )Other
    
    
    110
    
    
    
    0.2
    
    
    
    (282
    )
    
    
    (1.1
    )
    
    
    97
    
    
    
    0.3Total income taxes
    
    $
    17,488
    
    
    
    34.1
    %
    
    $
    7,662
    
    
    
    29.5
    %
    
    $
    8,289
    
    
    
    25.1
    %
   F-21




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
  June 30,2008
    
    
    2007Deferred Tax Assets:Inventories
    
    $
    2,966
    
    
    $
    5,044Accounts receivable
    
    
    552
    
    
    
    623Foreign and state tax credits
    
    
    2,229
    
    
    
    2,585Unrealized foreign exchange losses
    
    
    455
    
    
    
    140Supplemental executive retirement plan
    
    
    6,979
    
    
    
    7,385Tax loss carryforwards
    
    
    6,300
    
    
    
    3,765Benefit plan adjustments
    
    
    5,268
    
    
    
    4,138Asset write-downs
    
    
    1,792
    
    
    
    1,865Accrued expenses
    
    
    546
    
    
    
    1,545Unrealized losses on available-for-sale securities
    
    
    
    
    
    
    178Other
    
    
    1,453
    
    
    
    957Deferred tax assets before valuation allowance
    
    
    28,540
    
    
    
    28,225Valuation allowance
    
    
    (4,446
    )
    
    
    (4,855
    )Deferred tax assets after valuation allowance
    
    
    24,094
    
    
    
    23,370Deferred Tax Liabilities:Accelerated depreciation
    
    
    11,942
    
    
    
    10,780Unrealized gains on available-for-sale securities
    
    
    167
    
    
    
    Acquisition intangibles
    
    
    
    
    
    
    1,024State income taxes
    
    
    
    
    
    
    261Accrued insurance
    
    
    966
    
    
    
    1,064Defined benefit plans
    
    
    6,849
    
    
    
    2,780Other
    
    
    2,188
    
    
    
    1,108Deferred tax liabilities
    
    
    22,112
    
    
    
    17,017Net deferred tax assets
    
    $
    1,982
    
    
    $
    6,353
    F-22




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
     Balance at July 1, 2007
    
    $
    7,643Additions based on tax positions related to the current year
    
    
    4,319Additions for tax positions of prior years
    
    
    2,189Reductions for tax positions of prior years
    
    
    (489
    )Reductions due to lapse of applicable statute of limitations
    
    
    (2,748
    )Audit settlements paid during fiscal 2008
    
    
    Balance at June 30, 2008
    
    
    10,914Interest and penalties
    
    
    923Total balance at June 30, 2008
    
    $
    11,837
  F-23




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
   9. Other Liabilities
 June 30,2008
    
    
    2007Noncurrent
benefit plans liabilities
    
    $
    17,807
    
    
    $
    20,714Noncurrent FIN 48 income tax liability
    
    
    4,786
    
    
    
    Noncurrent deferred income
    
    
    649
    
    
    
    1,152Noncurrent deferred taxes
    
    
    1,399
    
    
    
    1,134Other noncurrent liabilities
    
    
    1,195
    
    
    
    2,220$
    25,836
    
    
    $
    25,220
 10. Stock-Based Awards
  
    
    The 2005 Equity Incentive Plan (2005 Plan), approved by stockholders in December 2005,
authorized 1,200,000 shares covering several different types of awards, including stock
options, performance shares, performance units, stock appreciation rights, restricted
shares and deferred shares.
 
    
    The Amended and Restated 1995 Employee Stock Option Plan covering 4,150,000 shares of
common stock.
    
    The Amended and Restated Non-Employee Director Plan covering 150,000 shares of common
stock. Under the provisions of SFAS 123(R), members of the Board of Directors are
considered employees.
  F-24




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
  Year Ended June 30,2008
    
    
    2007
    
    
    2006Continuing operationsCost of sales
    
    $
    24
    
    
    $
    5
    
    
    $
    3Research and development expense
    
    
    108
    
    
    
    71
    
    
    
    45Selling, general and administrative expense
    
    
    862
    
    
    
    411
    
    
    
    373Total stock-based compensation expense
    
    $
    994
    
    
    $
    487
    
    
    $
    421Total stock-based compensation expense, net of tax
    
    $
    594
    
    
    $
    288
    
    
    $
    249Discontinued operationsNet (loss) earnings from discontinued operations
    
    $
    668
    
    
    $
    123
    
    
    $
    81
  Year Ended June 30,2008
    
    2007
    
    2006Expected dividend yield
    
    
    *
    
    
    
    4.00
    %
    
    
    2.22
    %Expected volatility
    
    
    *
    
    
    
    27
    %
    
    
    29
    %Risk-free interest rate
    
    
    *
    
    
    
    4.62
    %
    
    
    4.63
    %Expected life
    
    
    *
    
    
    4.8 Years
    
    4.9 Years
 
 *
    
    Not applicable. There were no stock options granted during fiscal 2008. Stock Options
  F-25




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
  Year Ended June 30,2008
    
    2007
    
    2006Weighted
    
    
    
    
    
    Weighted
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    Average
    
    
    
    
    
    AverageExercise
    
    
    
    
    
    Exercise
    
    
    
    
    
    ExerciseShares
    
    Price
    
    Shares
    
    Price
    
    Shares
    
    PriceOutstanding at July 1
    
    
    1,741,161
    
    
    $
    32.47
    
    
    
    2,040,626
    
    
    $
    32.47
    
    
    
    2,477,153
    
    
    $
    31.73Granted
    
    
    
    
    
    
    
    
    
    
    167,250
    
    
    
    33.91
    
    
    
    176,100
    
    
    
    35.85Exercised
    
    
    (459,510
    )
    
    
    32.28
    
    
    
    (152,861
    )
    
    
    28.97
    
    
    
    (475,095
    )
    
    
    29.10Settled
    
    
    (159,300
    )
    
    
    35.67
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Forfeited/Expired
    
    
    (76,851
    )
    
    
    35.00
    
    
    
    (313,854
    )
    
    
    34.93
    
    
    
    (137,532
    )
    
    
    35.13Outstanding at June 30
    
    
    1,045,500
    
    
    $
    31.87
    
    
    
    1,741,161
    
    
    $
    32.47
    
    
    
    2,040,626
    
    
    $
    32.47Vested and expected to
vest at June 30
    
    
    1,038,681
    
    
    $
    31.85
    
    
    
    1,700,212
    
    
    $
    32.41
    
    
    
    2,017,132
    
    
    $
    32.43Exercisable at June 30
    
    
    996,063
    
    
    $
    31.69
    
    
    
    1,534,136
    
    
    $
    32.17
    
    
    
    1,876,484
    
    
    $
    32.22
      F-26




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
  Stock Options Outstanding
    
    Stock Options ExercisableWeighted
    
    Weighted
    
    
    
    
    
    WeightedAverage
    
    Average
    
    
    
    
    
    AverageRange of

    
    
    
    
    Remaining
    
    Exercise
    
    
    
    
    
    ExerciseExercise Prices

    Options
    
    Contractual Life
    
    Price
    
    Options
    
    Price$22.49 $28.53
    
    43,850
    
    
    
    5.03
    
    
    $
    26.97
    
    
    
    43,850
    
    
    $
    26.97$28.67

    
    500,000
    
    
    
    3.64
    
    
    $
    28.67
    
    
    
    500,000
    
    
    $
    28.67$28.80 $41.58

    
    501,650
    
    
    
    4.90
    
    
    $
    35.50
    
    
    
    452,213
    
    
    $
    35.491,045,500
    
    
    
    4.30
    
    
    $
    31.87
    
    
    
    996,063
    
    
    $
    31.69
  Restricted Stock
  Year Ended June 30,2008
    
    2007
    
    2006Weighted
    
    
    
    
    
    Weighted
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    Average
    
    
    
    
    
    AverageGrant
    
    
    
    
    
    Grant
    
    
    
    
    
    GrantShares
    
    Price
    
    Shares
    
    Price
    
    Shares
    
    PriceNonvested at July 1
    
    
    3,908
    
    
    $
    35.84
    
    
    
    13,937
    
    
    $
    35.88
    
    
    
    
    
    
    $
    Granted
    
    
    79,917
    
    
    
    33.91
    
    
    
    3,908
    
    
    
    35.84
    
    
    
    13,937
    
    
    
    35.88Vested
    
    
    (9,178
    )
    
    
    34.19
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Forfeited
    
    
    (9,960
    )
    
    
    33.22
    
    
    
    (13,937
    )
    
    
    35.88
    
    
    
    
    
    
    
    Nonvested at June 30
    
    
    64,687
    
    
    $
    34.09
    
    
    
    3,908
    
    
    $
    35.84
    
    
    
    13,937
    
    
    $
    35.88
  Shareholder Rights Plan
  F-27




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
   Stock Repurchase Programs
  Compensation Plan for Non-Employee Directors
  11. Segment Information
  F-28




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
    Cardiac
    
    
    
    
    
    CorporateAssist
    
    Vascular
    
    andProducts
    
    Products
    
    Other (a)
    
    ConsolidatedYear ended June 30, 2008Net sales to external customers
    
    $
    189,316
    
    
    $
    40,333
    
    
    $
    1,266
    
    
    $
    230,915Operating earnings (loss)
    
    $
    38,350
    
    
    $
    (224
    )
    
    $
    (920
    )
    
    $
    37,206Assets
    
    $
    127,303
    
    
    $
    83,537
    
    
    $
    312,898
    
    
    $
    523,738Long-lived asset expenditures
    
    $
    4,959
    
    
    $
    2,080
    
    
    $
    6,447
    
    
    $
    13,486Depreciation and amortization
    
    $
    7,672
    
    
    $
    1,779
    
    
    $
    8,457
    
    
    $
    17,908Year ended June 30, 2007Net sales to external customers
    
    $
    178,321
    
    
    $
    33,484
    
    
    $
    1,186
    
    
    $
    212,991Operating earnings (loss) (b)
    
    $
    33,576
    
    
    $
    (2,878
    )
    
    $
    (7,917
    )
    
    $
    22,781Assets
    
    $
    126,825
    
    
    $
    62,103
    
    
    $
    187,228
    
    
    $
    376,156Long-lived asset expenditures
    
    $
    2,360
    
    
    $
    3,682
    
    
    $
    9,197
    
    
    $
    15,239Depreciation and amortization
    
    $
    7,526
    
    
    $
    1,482
    
    
    $
    12,480
    
    
    $
    21,488Year ended June 30, 2006Net sales to external customers
    
    $
    164,782
    
    
    $
    30,147
    
    
    $
    1,587
    
    
    $
    196,516Operating earnings (loss)
    
    $
    29,405
    
    
    $
    (1,107
    )
    
    $
    (383
    )
    
    $
    27,915Assets
    
    $
    112,188
    
    
    $
    60,309
    
    
    $
    203,183
    
    
    $
    375,680Long-lived asset expenditures
    
    $
    3,536
    
    
    $
    1,944
    
    
    $
    5,858
    
    
    $
    11,338Depreciation and amortization
    
    $
    7,585
    
    
    $
    1,166
    
    
    $
    11,782
    
    
    $
    20,533
 
 (a)
    
    Net sales of life science products by Genisphere are included within Corporate and Other. Assets within Corporate
and Other include cash, investments, property, plant and equipment, net, including the corporate headquarters, cash
surrender value of officers life insurance and assets related to the PM and IP discontinued businesses. Corporate and
Other includes long-lived asset expenditures and depreciation and amortization expense for the PM and IP discontinued
businesses. Segment SG&A expenses include fixed corporate G&A allocated charges.(b)
    
    Operating earnings for the Cardiac Assist Products segment includes special charges of $1.1 million in fiscal 2007.
Operating loss for the Vascular Products segment includes special charges of $1.1 million in fiscal 2007. Operating loss
for Corporate and Other includes special charges of $6.5 million in fiscal 2007. F-29




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
  Year Ended June 30,2008
    
    
    2007
    
    
    2006Consolidated operating earnings
    
    $
    37,206
    
    
    $
    22,781
    
    
    $
    27,915Interest income, net
    
    
    2,614
    
    
    
    2,443
    
    
    
    1,997Dividend income
    
    
    
    
    
    
    196
    
    
    
    4,523Gain on sale of investments
    
    
    13,173
    
    
    
    1,273
    
    
    
    Other, net
    
    
    (1,727
    )
    
    
    (737
    )
    
    
    (1,414
    )Earnings from continuing operations
before income taxes
    
    $
    51,266
    
    
    $
    25,956
    
    
    $
    33,021
  Year Ended June 30,2008
    
    
    2007
    
    
    2006Cardiac Assist Products
    
    $
    189,316
    
    
    $
    178,321
    
    
    $
    164,782Vascular Products
    
    
    40,333
    
    
    
    33,484
    
    
    
    30,147Genisphere
    
    
    1,266
    
    
    
    1,186
    
    
    
    1,587Total
    
    $
    230,915
    
    
    $
    212,991
    
    
    $
    196,516
  Year Ended June 30,2008
    
    
    2007
    
    
    2006United States
    
    $
    98,758
    
    
    $
    102,503
    
    
    $
    96,586Foreign countries
    
    
    132,157
    
    
    
    110,488
    
    
    
    99,930Total
    
    $
    230,915
    
    
    $
    212,991
    
    
    $
    196,516
  June 30,2008
    
    
    2007
    
    
    2006United States
    
    $
    83,076
    
    
    $
    68,131
    
    
    $
    70,657Foreign countries
    
    
    29,805
    
    
    
    13,076
    
    
    
    7,728Total
    
    $
    112,881
    
    
    $
    81,207
    
    
    $
    78,385
 12. Retirement Benefit Plans
  F-30




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
 Defined Benefit Pension Plans  U.S. and International
  Supplemental Executive Retirement Plans (SERP)
 Employers Accounting for Pensions
  
    
    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.
    
    The SERP will not be less than the value of the benefit that would have been payable had
his retirement occurred at age 65.
    
    The expected annual SERP payment to Mr. Saper commencing at a presumed retirement age of
81, based on the above plan would be $3.1 million.
    
    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.
   Post-Retirement Medical Benefits Plan
  F-31




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
 Defined Contribution Plans
  Adoption of New Accounting Standard
  SFAS 87/88Before
    
    Minimum
    
    
    
    
    
    AfterSFAS 87/88/158
    
    Pension Liability
    
    SFAS 158
    
    SFAS 87/88/158Adjustments
    
    Adjustments
    
    Adjustments
    
    AdjustmentsPrepaid expenses and other current assets
    
    $
    18,809
    
    
    $
    
    
    
    $
    (7,642
    )
    
    $
    11,167Other assets, including
non-current deferred taxes
    
    
    31,398
    
    
    
    (1,332
    )
    
    
    4,831
    
    
    
    34,897Accrued expenses
    
    
    17,612
    
    
    
    
    
    
    
    49
    
    
    
    17,661Other liabilities
    
    
    26,022
    
    
    
    (3,018
    )
    
    
    2,216
    
    
    
    25,220Accumulated other comprehensive loss
    
    
    (824
    )
    
    
    1,686
    
    
    
    (5,076
    )
    
    
    (4,214
    )
 F-32




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
 Net Periodic Benefit Costs
  Year Ended June 30,2008
    
    
    2007
    
    
    2006
    
    
    2008
    
    
    2007
    
    
    2006U.S. and International
    
    
    SERPNet Periodic Benefit CostsService cost
    
    $
    2,531
    
    
    $
    2,700
    
    
    $
    3,240
    
    
    $
    376
    
    
    $
    350
    
    
    $
    387Interest cost
    
    
    4,415
    
    
    
    4,069
    
    
    
    3,714
    
    
    
    1,057
    
    
    
    1,000
    
    
    
    829Expected return on assets
    
    
    (4,269
    )
    
    
    (3,697
    )
    
    
    (3,326
    )
    
    
    
    
    
    
    
    
    
    
    Amortization of:Net loss
    
    
    301
    
    
    
    521
    
    
    
    1,168
    
    
    
    12
    
    
    
    9
    
    
    
    23Unrecognized prior service cost
    
    
    (43
    )
    
    
    12
    
    
    
    13
    
    
    
    (95
    )
    
    
    (75
    )
    
    
    (75
    )Special termination benefits (a)
    
    
    551
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Curtailment loss (b)
    
    
    83
    
    
    
    14
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net periodic benefit costs
    
    $
    3,569
    
    
    $
    3,619
    
    
    $
    4,809
    
    
    $
    1,350
    
    
    $
    1,284
    
    
    $
    1,164
 
 (a)
    
    In the fourth quarter of fiscal 2008, we recognized a special termination benefits
expense related to U.S. workforce reductions as a result of the sale of the PM business.(b)
    
    In the fourth quarter of fiscal 2008, we recognized a curtailment loss related to
U.S. and International workforce reductions as a result of the sale of the PM business. In
the second quarter of fiscal 2007, we recognized a curtailment loss related to U.S.
workforce reductions in the Interventional Products and Patient Monitoring businesses. Year Ended June 30,2008
    
    
    2007
    
    
    2006Post-Retirement MedicalNet Periodic Benefit CostsService cost
    
    $
    
    
    
    $
    
    
    
    $
    Interest cost
    
    
    15
    
    
    
    12
    
    
    
    11Expected return on assets
    
    
    
    
    
    
    
    
    
    
    Amortization of:Net loss
    
    
    3
    
    
    
    1
    
    
    
    2Unrecognized prior service cost
    
    
    4
    
    
    
    5
    
    
    
    5Net periodic benefit costs
    
    $
    22
    
    
    $
    18
    
    
    $
    18
 F-33




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
 Obligations and Funded Status
  Year Ended June 30,2008
    
    
    2007
    
    
    2008
    
    
    2007U.S. and International
    
    
    SERPChange in Projected Benefit ObligationPension benefit obligation at beginning of year
    
    $
    67,655
    
    
    $
    62,084
    
    
    $
    18,306
    
    
    $
    16,113Service cost
    
    
    2,531
    
    
    
    2,700
    
    
    
    376
    
    
    
    350Interest cost
    
    
    4,415
    
    
    
    4,069
    
    
    
    1,057
    
    
    
    1,000Foreign exchange impact
    
    
    499
    
    
    
    171
    
    
    
    
    
    
    
    Employee contributions
    
    
    64
    
    
    
    48
    
    
    
    
    
    
    
    Plan amendments
    
    
    
    
    
    
    (1,186
    )
    
    
    
    
    
    
    Special termination benefits
    
    
    551
    
    
    
    
    
    
    
    
    
    
    
    Curtailment
    
    
    (2,151
    )
    
    
    (388
    )
    
    
    
    
    
    
    Actuarial (gain) loss
    
    
    (4,309
    )
    
    
    1,406
    
    
    
    (1,835
    )
    
    
    1,078Benefits paid
    
    
    (1,400
    )
    
    
    (1,249
    )
    
    
    (234
    )
    
    
    (235
    )Pension benefit obligation at end of year
    
    $
    67,855
    
    
    $
    67,655
    
    
    $
    17,670
    
    
    $
    18,306Accumulated benefit obligation at end of year
    
    $
    64,563
    
    
    $
    61,601
    
    
    $
    17,670
    
    
    $
    18,306Change in Plan AssetsFair value of plan assets at beginning of year
    
    $
    66,513
    
    
    $
    56,179
    
    
    
    *
    
    
    
    *Actual return on assets
    
    
    5,468
    
    
    
    3,952
    
    
    
    *
    
    
    
    *Foreign exchange impact
    
    
    751
    
    
    
    231
    
    
    
    *
    
    
    
    *Employer contributions
    
    
    13,423
    
    
    
    7,352
    
    
    
    *
    
    
    
    *Employee contributions
    
    
    64
    
    
    
    48
    
    
    
    *
    
    
    
    *Benefits paid
    
    
    (1,400
    )
    
    
    (1,249
    )
    
    
    *
    
    
    
    *Fair value of plan assets at end of year
    
    $
    84,819
    
    
    $
    66,513
    
    
    
    *
    
    
    
    *
 
 *
    
    Not applicable. Year Ended June 30,2008
    
    
    2007
    
    
    2008
    
    
    2007U.S. and International
    
    
    SERPFunded Status at June 30,Fair value of plan assets
    
    $
    84,819
    
    
    $
    66,513
    
    
    $
    
    
    
    $
    Pension benefit obligation
    
    
    67,855
    
    
    
    67,655
    
    
    
    17,670
    
    
    
    18,306Funded status-plan assets less than benefit obligation
    
    $
    16,964
    
    
    $
    (1,142
    )
    
    $
    (17,670
    )
    
    $
    (18,306
    )
 F-34




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
 Year Ended June 30,2008
    
    
    2007Post-Retirement MedicalChange in Projected-Benefit ObligationBenefit obligation at beginning of year
    
    $
    232
    
    
    $
    191Service costInterest cost
    
    
    15
    
    
    
    12Plan amendments
    
    
    
    
    
    
    Actuarial (gain) loss
    
    
    (38
    )
    
    
    29Benefit obligation at end of year
    
    $
    209
    
    
    $
    232Accumulated benefit obligation at end of year
    
    $
    209
    
    
    $
    232Funded Status at June 30,Benefit obligation
    
    $
    209
    
    
    $
    232Fair value of plan assets
    
    
    
    
    
    
    Funded status-plan assets less than benefit obligation
    
    $
    (209
    )
    
    $
    (232
    )
   Year Ended June 30,2008
    
    
    2007
    
    
    2008
    
    
    2007U.S. and International
    
    
    SERPCurrent benefit liability
    
    $
    
    
    
    $
    
    
    
    $
    (235
    )
    
    $
    (227
    )Non-current benefit liability
    
    
    (163
    )
    
    
    (2,403
    )
    
    
    (17,435
    )
    
    
    (18,079
    )Non-current pension asset
    
    
    17,127
    
    
    
    1,261
    
    
    
    
    
    
    
    Funded status
    
    $
    16,964
    
    
    $
    (1,142
    )
    
    $
    (17,670
    )
    
    $
    (18,306
    )
 2008
    
    
    2007Post-Retirement MedicalCurrent benefit liability
    
    $
    
    
    
    $
    Non-current benefit liability
    
    
    (209
    )
    
    
    (232
    )Non-current pension asset
    
    
    
    
    
    
    Funded status
    
    $
    (209
    )
    
    $
    (232
    )
 F-35




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
  U.S. and
    
    
    
    
    
    
    Post-RetirementInternational
    
    
    SERP
    
    
    MedicalNet actuarial loss (gain)
    
    $
    1,447
    
    
    $
    (26
    )
    
    $
    65Prior service (credit) cost
    
    
    (1,121
    )
    
    
    (26
    )
    
    
    26Accumulated other comprehensive loss (income), gross
    
    $
    326
    
    
    $
    (52
    )
    
    $
    91Accumulated other comprehensive loss (income), net
of tax
    
    $
    32
    
    
    $
    (31
    )
    
    $
    54
  U.S. and
    
    
    
    
    
    
    Post-RetirementInternational
    
    
    SERP
    
    
    MedicalNet actuarial (gain) loss
    
    $
    (3
    )
    
    $
    11
    
    
    $
    1Prior service (credit) cost
    
    
    (52
    )
    
    
    (28
    )
    
    
    4Total
    
    $
    (55
    )
    
    $
    (17
    )
    
    $
    5
 Plan Assumptions
  2008
    
    2007
    
    2006Benefit ObligationDiscount rate
    
    
    7.18
    %
    
    
    6.43
    %
    
    
    6.50
    %Rate of compensation increase
    
    
    4.47
    %
    
    
    4.50
    %
    
    
    4.50
    %Expected return on plan assets
    
    
    5.58
    %
    
    
    6.04
    %
    
    
    6.30
    %
 2008
    
    2007
    
    2006Net Periodic Benefit CostDiscount rate
    
    
    6.53
    %
    
    
    6.18
    %
    
    
    5.50
    %Rate of compensation increase
    
    
    4.49
    %
    
    
    4.50
    %
    
    
    4.50
    %Expected return on plan assets
    
    
    6.15
    %
    
    
    6.40
    %
    
    
    6.50
    %
   F-36




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
 U.S. Plan Asset Allocation and Investment Guidelines
  June 30,2009
    
    2008
    
    2007Asset Category
    
    Target Allocation
    
    Percentage of Plan AssetsSmall Capitalization Equities (a)
    
    
    10.0
    %
    
    
    7.7
    %
    
    
    8.1
    %Fixed Income Bonds  Corporate
    
    
    15.0
    %
    
    
    11.7
    %
    
    
    14.6
    %Fixed Income Bonds  Government
    
    
    75.0
    %
    
    
    73.6
    %
    
    
    75.7
    %Cash
    
    
    0.0
    %
    
    
    7.0
    %
    
    
    1.6
    %100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
 
 (a)
    
    Represents investment in our common stock of $6.2 million and $5.0 million (131,000
shares) at June 30, 2008 and 2007, respectively.   
    
    Our investment objective is to invest in securities which provide minimal risk, a high
degree of liquidity and an adequate return. Return on such investments, while recognized as
important, is not the primary consideration. Safety of principal and liquidity are the key
objectives.
    
    At least 50% of the fixed portion of the portfolio will be invested in Treasury and
Federal Agency obligations. The maximum maturity of each security is 10 years.
    
    No more than 50% of the portfolio will be invested in 5 to 10 year medium-term AAA-rated
corporate notes.
    
    No more than $3 million in aggregate will be invested in any single companys AAA-rated
corporate notes.
    
    Investments may include Datascope common stock. The amount of Datascope stock is limited
by ERISA rules (section 407 (a)), which says that the pension fund can purchase Company
stock, as long as immediately thereafter, the aggregate fair market value of Company stock
held by the fund does not exceed 10% of the fair market value of all pension fund assets.
  U.S. and
    
    
    
    
    
    Post-RetirementFiscal Year
    
    International
    
    SERP
    
    Medical2009
    
    $
    2,107
    
    
    $
    242
    
    
    $
    2010
    
    
    2,336
    
    
    
    3,114
    
    
    
    222011
    
    
    2,511
    
    
    
    2,919
    
    
    
    242012
    
    
    2,732
    
    
    
    2,714
    
    
    
    252013
    
    
    2,993
    
    
    
    2,502
    
    
    
    262014  2018
    
    
    20,007
    
    
    
    9,228
    
    
    
    72
 F-37




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##### Table of Contents



DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
  13. Commitments and Contingencies
 Leases
  Fiscal Year2009
    
    $
    3,5292010
    
    
    2,7082011
    
    
    1,4522012
    
    
    5352013
    
    
    297Thereafter
    
    
    Total future minimum rental payments
    
    $
    8,521
  Litigation
   F-38




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DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
  Credit Arrangements
  Purchase Commitments
  Warranty Obligations
  F-39




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DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
  Year Ended June 30,2008
    
    
    2007
    
    
    2006Warranty reserve at the beginning of the year
    
    $
    250
    
    
    $
    350
    
    
    $
    300Warranties for discontinued operations
divested during the year
    
    
    (225
    )
    
    
    
    
    
    
    Warranties accrued during the year
    
    
    50
    
    
    
    79
    
    
    
    389Warranties settled during the year
    
    
    (35
    )
    
    
    (179
    )
    
    
    (339
    )Warranty reserve at the end of the year
    
    $
    40
    
    
    $
    250
    
    
    $
    350
  Rabbi Trust
  14.
Special Charges
 Fiscal 2007
 Workforce Reductions in the European Sales Organization, Corporate and Genisphere
  Goodwill Impairment  Genisphere
  Inquiry Expenses
  F-40




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DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
   Cardiac Assist Products
    
    $1.1 millionVascular Products
    
    $1.1 millionCorporate and Other
    
    $6.5 million
 15. Quarterly Financial Data (Unaudited)
 Year Ended June 30, 2008First
    
    
    Second
    
    
    Third
    
    
    FourthQuarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    TotalNet sales
    
    $
    48,015
    
    
    $
    59,234
    
    
    $
    60,331
    
    
    $
    63,335
    
    
    $
    230,915Gross profit
    
    $
    31,298
    
    
    $
    38,375
    
    
    $
    39,898
    
    
    $
    41,331
    
    
    $
    150,902Net earnings from
continuing operations
    
    $
    11,869
    
    
    $
    5,353
    
    
    $
    8,976
    
    
    $
    7,580
    
    
    $
    33,778Net (loss) earnings from
discontinued operations
    
    $
    (77
    )
    
    $
    1,736
    
    
    $
    113
    
    
    $
    (5,316
    )
    
    $
    (3,544
    )Net gain on sale of
discontinued operations
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    76,672
    
    
    $
    76,672Net earnings
    
    $
    11,792
    
    
    $
    7,089
    
    
    $
    9,089
    
    
    $
    78,936
    
    
    $
    106,906Net earnings per share from
continuing operations, basic
    
    $
    0.77
    
    
    $
    0.35
    
    
    $
    0.58
    
    
    $
    0.48
    
    
    $
    2.19Net earnings per share from
continuing operations,
diluted
    
    $
    0.76
    
    
    $
    0.35
    
    
    $
    0.58
    
    
    $
    0.48
    
    
    $
    2.16
 Year Ended June 30, 2007First
    
    
    Second
    
    
    Third
    
    
    FourthQuarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter
    
    
    TotalNet sales
    
    $
    49,591
    
    
    $
    50,984
    
    
    $
    55,826
    
    
    $
    56,590
    
    
    $
    212,991Gross profit
    
    $
    32,879
    
    
    $
    33,079
    
    
    $
    35,749
    
    
    $
    37,136
    
    
    $
    138,843Net earnings from
continuing operations
    
    $
    5,527
    
    
    $
    5,289
    
    
    $
    5,589
    
    
    $
    1,889
    
    
    $
    18,294Net (loss) earnings from
discontinued operations
    
    $
    (994
    )
    
    $
    (1,954
    )
    
    $
    2,272
    
    
    $
    (153
    )
    
    $
    (829
    )Net earnings
    
    $
    4,533
    
    
    $
    3,335
    
    
    $
    7,861
    
    
    $
    1,736
    
    
    $
    17,465Net earnings per share from
continuing operations, basic
    
    $
    0.36
    
    
    $
    0.35
    
    
    $
    0.37
    
    
    $
    0.12
    
    
    $
    1.20Net earnings per share from
continuing operations,
diluted
    
    $
    0.35
    
    
    $
    0.34
    
    
    $
    0.36
    
    
    $
    0.12
    
    
    $
    1.19
 F-41




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DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
  16. Earnings Per Share
  Year Ended June 30,2008
    
    
    2007
    
    
    2006Net earnings
    
    $
    106,906
    
    
    $
    17,465
    
    
    $
    25,843Weighted average number of common shares outstanding, basic
    
    
    15,441
    
    
    
    15,244
    
    
    
    14,974Effect of dilutive stock awards
    
    
    176
    
    
    
    143
    
    
    
    322Weighted average number of common shares outstanding, diluted
    
    
    15,617
    
    
    
    15,387
    
    
    
    15,296Net earnings per share, basic
    
    $
    6.92
    
    
    $
    1.15
    
    
    $
    1.73Net earnings per share, diluted
    
    $
    6.85
    
    
    $
    1.14
    
    
    $
    1.69
  17. Related Party Transactions
    F-42




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DATASCOPE CORP. AND SUBSIDIARIES
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
(Dollars in thousands, except per share data)
 18. Subsequent Event
  F-43




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DATASCOPE CORP. AND SUBSIDIARIES
 SCHEDULE II  VALUATION AND QUALIFYING ACCOUNTS
 Column A
    
    Column B
    
    
    Column C
    
    
    Column D
    
    
    Column EAdditions(1)
    
    
    (2)Charged to
    
    
    Charged to
    
    
    DeductionsBalance at
    
    
    Costs
    
    
    Other
    
    
    from
    
    
    Balance atBeginning
    
    
    and
    
    
    Accounts
    
    
    Reserves-
    
    
    Close ofDescription
    
    of Period
    
    
    Expenses
    
    
    Describe
    
    
    Describe
    
    
    Period(Dollars in thousands)Year Ended June 30, 2008Allowance for doubtful accounts
    
    $
    2,603
    
    
    $
    609
    
    
    $
    
    
    
    $
    435
    (A)
    
    $
    2,777Year Ended June 30, 2007Allowance for doubtful accounts
    
    $
    2,301
    
    
    $
    456
    
    
    $
    
    
    
    $
    154
    (A)
    
    $
    2,603Year Ended June 30, 2006Allowance for doubtful accounts
    
    $
    2,279
    
    
    $
    461
    
    
    $
    
    
    
    $
    439
    (A)
    
    $
    2,301
 
 (A)
    
    Write-offs S-1