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UNITED STATES SECURITIES AND
    EXCHANGE COMMISSIONWashington, D.C.
    20549
      Form 10-K
  (Mark one)þ

ANNUAL REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES
    EXCHANGE ACT OF 1934For the fiscal year ended
    December 31, 2008o

TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For
    the transition period
    from          to          .   Commission file number
    000-51348
      ev3 Inc.
 (Exact name of registrant as
    specified in its charter)
  Delaware(State or other jurisdiction
    of
    incorporation or organization)

32-0138874(I.R.S. Employer
    Identification No.)9600 54th Avenue North, Suite 100
    Plymouth, Minnesota(Address of principal
    executive offices)

55442(Zip Code)  (763) 398-7000
  (Registrants telephone
    number, including area code)
  Securities registered pursuant to section 12(b) of the
    Act:
  Title of Each Class:

Name of Each Exchange on Which Registered:Common Stock, par value $0.01 per share

The NASDAQ Stock Market   Securities registered pursuant to section 12(g) of the
    Act:
 None
  o þ
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K. o
  Rule 12b-2
  Large accelerated
    filer o

Accelerated
    filer þNon-accelerated filer (Do not check if a smaller reporting
    company) o

Smaller reporting
    company o   Rule 12b-2 o þ
      DOCUMENTS INCORPORATED BY REFERENCE
  Form 10-K




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##### 





TABLE OF
    CONTENTS
   
 PagePART IItem 1.


Business


1Item 1A.


Risk Factors


31Item 1B.


Unresolved Staff Comments


55Item 2.


Properties


55Item 3.


Legal Proceedings


56Item 4.


Submission of Matters to a Vote of Security
    Holders


56Item 4A.


Executive Officers of the Registrant


56PART IIItem 5.


Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities


59Item 6.


Selected Financial Data


62Item 7.


Managements Discussion and Analysis of
    Financial Condition and Results of Operations


64Item 7A.


Quantitative and Qualitative Disclosures About
    Market Risk


87Item 8.


Financial Statements and Supplementary Data


88Item 9.


Changes In and Disagreements With Accountants on
    Accounting and Financial Disclosure


89Item 9A.


Controls and Procedures


89Item 9B.


Other Information


89PART IIIItem 10.


Directors, Executive Officers and Corporate
    Governance


90Item 11.


Executive Compensation


91Item 12.


Security Ownership of Certain Beneficial Owners
    and Management and Related Stockholder Matters


91Item 13.


Certain Relationships and Related Transactions,
    and Director Independence


92Item 14.


Principal Accounting Fees and Services


92PART IVItem 15.


Exhibits, Financial Statement Schedules


93EX-10.11EX-10.12EX-10.27EX-21.1EX-23.1EX-31.1EX-31.2EX-32.1EX-32.2      This annual report on
    Form 10-K
    contains and incorporates by reference not only historical
    information, but also 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 are subject to the safe harbor created
    by those sections. We refer you to the information under the
    heading Part I. Item 1. Business 
    Forward-Looking Statements.
  As used in this report, references to ev3, the
    company, we, our or
    us, unless the context otherwise requires, refer to
    ev3 Inc. and its subsidiaries.
  We own or have rights to various trademarks, trade names or
    service marks, including the following:
    ev3 ® ,

    PROTEGE ® ,

    EVERFLEX tm ,

    PARAMOUNT tm MINI,
    PRIMUS tm ,

    SPIDERX ® ,

    SPIDERFX ® ,

    HELIX tm ,

    THE CLOT
    BUSTER ® ,

    GOOSE
    NECK ® ,

    VISI-PRO tm ,

    NXT tm ,

    NITREX ® ,

    NEXUS tm ,

    ONYX ® ,

    MORPHEUS tm ,

    ECHELON tm ,

    ULTRAFLOW tm ,

    MARATHON tm ,

    HYPERFORM tm ,

    HYPERGLIDE tm ,

    MIRAGE tm ,

    AXIUM tm ,

    SOLITAIRE tm ,

    SILVERSPEED ® ,

    X-PEDION tm ,

    X-CELERATOR tm ,

    REBAR tm ,

    FOXHOLLOW ® ,

    SILVERHAWK ® ,

    MEC tm TECHNOLOGY,
    RINSPIRATOR ® ,

    ROCKHAWK tm ,

    EVERCROSS tm ,

    NANCROSS tm and BEVEL
    360 tm .

    The trademarks
    PLETAL ® ,

    PLAVIX ® ,

    SAILOR tm Plus SUBMARINE ® Plus, ADMIRAL
    XTREME tm ,

    AMPHIRION ® ,

    the
    DIVER ® CE, and
    ACCULINK ® referred to in this annual report on
    Form 10-K
    are the registered trademarks of others.
 i




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PART I  ITEM 1.
    BUSINESS  Company
    Overview
      
    targeting under-innovated and emerging markets;
    leveraging our products across major endovascular sub-markets;
    investing in clinical research to demonstrate the benefits of
    our products;
    expanding our business through product innovation and strategic
    acquisitions;
    driving our global organization and presence; and
    leading our business by an experienced management team.       1




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For the Year Ended





For the Year EndedDecember 31,


Percent


December 31,


PercentNet Sales by Segment

2008


2007


Change


2007


2006


ChangeNet product salesPeripheral vascular

$
269,929


$
173,775



55.3
%

$
173,775


$
121,104



43.5
%Neurovascular


132,304



104,451



26.7
%


104,451



81,334



28.4
%Total net product sales


402,233



278,226



44.6
%


278,226



202,438



37.4
%Research collaboration(1)


19,895



5,957



234.0
%


5,957







100.0
%Total

$
422,128


$
284,183



48.5
%

$
284,183


$
202,438



40.4
%   For the Year Ended





For the Year EndedDecember 31,


Percent


December 31,


PercentNet Sales by Geography

2008


2007


Change


2007


2006


ChangeUnited States

$
275,433


$
177,198



55.4
%

$
177,198


$
121,180



46.2
%International


146,695



106,985



37.1
%


106,985



81,258



31.7
%Total

$
422,128


$
284,183



48.5
%

$
284,183


$
202,438



40.4
%     (1)
    
    Research collaboration revenue was derived from our
    collaboration and license agreement with Merck & Co,
    Inc. (Merck), which we assumed as a result of our
    acquisition of FoxHollow Technologies, Inc. on October 4,
    2007. Our collaboration and license agreement with Merck was
    terminated by Merck effective July 22, 2008. We
    subsequently reached an arrangement with Merck to accomplish an
    orderly wind-down of our research collaboration activities
    during the remainder of 2008. Research collaboration for the
    year ended December 31, 2007 includes revenue earned from
    October 4, 2007 through December 31, 2007. For further
    information see Note 2 to our consolidated financial
    statements.    The
    Endovascular Market
      
    the use of local or regional anesthesia frequently instead of
    general anesthesia;
    reduced patient discomfort and shorter recovery times;
    the reduced need for blood products and transfusions; 2




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
    shorter hospital stays for recovery;
    lower risks of patient complications related to
    procedures; and
    potentially lower costs.      
    The peripheral vascularmarket includes products used to
    treat arterial and venous disease in the legs, pelvis, neck,
    kidney and any other vascular anatomy other than that in the
    brain or the heart. According to the American Heart Association,
    or AHA, more than eight million people in the United States have
    peripheral arterial disease. We estimate that more than
    100 million people worldwide are affected by peripheral
    arterial disease.
    The neurovascularmarket includes products used to treat
    vascular disease and disorders in the brain, including
    arterio-venous malformations, or AVMs, and strokes caused by
    either vascular occlusion (ischemic) or rupture (hemorrhagic).
    The World Health Organization, or WHO, estimates that there are
    approximately 15 million cases of stroke worldwide each
    year. Of these, the WHO estimates that five million people die
    from the stroke and an additional five million are left with a
    permanent disability.
    The cardiovascularmarket includes products used to treat
    coronary artery disease, atrial fibrillation and other disorders
    in the heart and adjacent vessels. The AHA estimates that
    81 million people in the United States have cardiovascular
    disease. We estimate that more than 850 million people
    worldwide are affected by cardiovascular disease.  Our
    Peripheral Vascular Markets
  Peripheral
    Vascular Disease
    build-up
    and/or
 3




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build-up
  Endovascular Today
      Peripheral
    Vascular Market
  Journal of American Geriatric Society Cardiology Review
   4




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
    Increased Awareness.  Recent emphasis on
    peripheral vascular disease education from medical associations,
    insurance companies and online medical communities, as well as
    publication in medical journals, is increasing public and
    physician awareness of peripheral vascular disease risk factors,
    symptoms and treatment options. The Legs for Life
    campaign screens more than 40,000 people for peripheral
    vascular disease each year, of which nearly 29% are at moderate
    to high risk of lower extremity peripheral vascular disease. The
    American Diabetes Association, or ADA, recommends that all
    diabetics over the age of 50 be screened for peripheral vascular
    disease.
    Evolving Physician Practice Patterns.  Given
    that many patients with coronary artery disease also have
    peripheral vascular disease, we believe that interventional
    cardiologists and vascular surgeons are increasingly screening
    patients for both diseases. As a consequence, we believe that
    physicians are diagnosing more cases of peripheral vascular
    disease. In addition, heightened awareness of peripheral
    vascular disease, its symptoms and treatment options is leading
    to increased referrals from general practitioners, podiatrists
    who treat patients with pain and lesions in the feet that may be
    caused by peripheral vascular disease, and nephrologists,
    diabetologists and endocrinologists, who treat diabetics often
    experiencing complications resulting from peripheral vascular
    disease.
    Increased Peripheral Vascular Disease
    Screening.  Studies and medical articles have
    advocated increased peripheral vascular disease screening by
    primary care physicians using an ankle-brachial index, or ABI, a
    simple technique that compares blood pressure in a
    patients foot to blood pressure in the patients arm
    to determine how well blood is flowing to the foot. In addition
    to the ABI, physicians are increasingly using established
    techniques, such as angiography and ultrasound, to either
    diagnose or confirm diagnosis of peripheral vascular disease.  Peripheral
    Vascular Disease Treatment Options
  and/or
  Non-Invasive Management. and/or
  Minimally Invasive Endovascular
    Procedures.
 5




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
    Stents, angioplasty and atherectomy combined with embolic
    protection systems, which protect against plaque and debris from
    traveling downstream, blocking off the vessel and disrupting
    blood flow;
    drug-eluting stents, where a stent is coated with a
    slow-to-moderate release drug formulation intended to reduce
    restenosis, which occurs when the treated vessel becomes blocked
    again;
    drug-coated balloons, where an angioplasty balloon is coated
    with a drug formulation intended to reduce restenosis; and
    vascular cryotherapy, where an angioplasty balloon is inflated
    with nitrous oxide in an attempt to reduce inflammation caused
    by treatment of the lesion.    Surgical Procedures.
       6




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Our
    Peripheral Vascular Product Portfolio
    Atherectomy
    Plaque Excision Products
    SilverHawk Plaque Excision System.
    
    Safety.  The SilverHawk is designed not to
    stretch or damage the artery walls, which can lead to dissection
    or perforation of the artery. We believe that the safety of the
    SilverHawk, measured by low rates of perforation and dissection,
    is supported by results from the treatment of 1,517 lesions in
    728 patients recorded in our TALON registry. In data
    published in the Journal of Endovascular Therapyin 2006,
    less than 5% and 1% of these lesions treated post-SilverHawk had
    dissections and perforations, respectively. The SilverHawk
    procedure is minimally-invasive and typically performed under
    local anesthesia. Therefore, it does not have many of the risks
    associated with more invasive surgeries and general anesthesia.
    To date, we have not conducted studies designed to directly
    compare the safety of the SilverHawk against alternative
    procedures, such as angioplasty, stenting or bypass grafting.
    Efficacy.  Unlike most treatments for
    peripheral artery disease that leave plaque behind in the
    artery, the SilverHawk removes plaque. The SilverHawk has
    removed over 700 milligrams of plaque in a single procedure,
    with an average of approximately 100 milligrams of plaque per
    procedure. We believe that excising plaque without causing
    stretch injury to the artery wall may minimize restenosis and
    the need for reintervention. We also believe that the efficacy
    of the SilverHawk, measured by low 12 month reintervention
    rates is supported by the results of five single site studies as
    well as our TALON registry. In order to further evaluate the
    long term efficacy data of the SilverHawk during endovascular
    treatment of peripheral arterial disease, we are planning to
    conduct the DEFINITIVE LE (Lower Extremity) Study, a
    prospective, multi-center, non-randomized, single-arm study to
    evaluate the intermediate and long-term effectiveness of
    stand-alone SilverHawk Plaque Excision for endovascular
    treatment of peripheral arterial disease in femoropoliteal or
    tibial-peroneal arteries. The primary effectiveness endpoint for
    patients with claudication is expected to be primary patency at
    one year as defined by duplex ultrasound peak velocity ratio.
    The primary effectiveness endpoint for patients with critical
    limb 7




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ischemia is amputation-free survival at 12 months. We
    anticipate enrollment for the DEFINITIVE LE (Lower Extremity)
    Study to begin in the first half of 2009.  
    Treats Difficult to Treat Lesions.  The
    SilverHawk enables physicians to remove plaque from long,
    bifurcated and difficult to treat lesions in a wide variety of
    locations, including arteries behind and below the knee and in
    the foot. Approximately one-third of SilverHawk procedures to
    date have been performed below the knee, an area where lesions
    have traditionally gone untreated until they require bypass
    surgery or amputation. Certain treatment locations, such as
    arteries below the knee or in the foot, are not suited for
    physicians with limited experience using the device.
    Utilizes Familiar Techniques.  The SilverHawk
    procedure employs techniques similar to those used in
    angioplasty, which are familiar to the approximately 12,000
    interventional cardiologists, vascular surgeons and
    interventional radiologists in the United States who are
    generally trained in endovascular techniques. This significantly
    increases the number of physicians who are able to perform the
    procedure compared to surgical alternatives that must be
    performed by highly-trained vascular surgeons. In addition, the
    SilverHawk was designed to be easy to use. The SilverHawk
    operates with one switch that controls all device functionality,
    and has a unique torque shaft designed for a one-to-one
    correlation between the handle and the tip, providing physicians
    with precise control of the position of the cutting blade. We
    continue to focus on providing further enhancements to the
    SilverHawk as part of our research and development efforts.
    Cost and Time Efficient.  A single SilverHawk
    device can be used to treat multiple and long lesions where more
    than one stent might otherwise be required. Compared to surgical
    alternatives, the SilverHawk procedure reduces cost by allowing
    physicians to treat patients in a catheterization lab instead of
    an operating room, decreasing the length of hospitalization and
    reducing complications.
    Allows for
    Follow-Up
    Treatment Options.  Physicians can, and sometimes
    do, use adjunctive angioplasty and occasionally stenting during
    a SilverHawk procedure. When the SilverHawk procedure is
    performed without stenting, which we estimate is greater than
    90% of the time, increased future treatment options remain
    available in the event that restenosis does occur and
    reintervention is required as there is no metal left behind post
    procedure, as is the case with stenting.
    Captures and Removes Plaque.  The patient and
    the physician get immediate feedback by seeing the volume of
    plaque removed, visibly reinforcing the benefits of the
    procedure.       8




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Future Products.
  Stents
    Protégé EverFlex, Protégé GPS and
    Protégé GPS BIGGS.
  
    Spiral cell interconnections that greatly enhance flexibility;
    New wave peak structure that more efficiently distributes stress
    and resists compression; and
    Longer lengths (up to 200 mm and all 6 French compatible), which
    minimize the need for overlapping stents when treating long
    lesions.    follow-up
 9




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ParaMount Mini, PRIMUS and Visi-Pro Balloon Expandable
    Stents.
  Embolic
    Protection and Thrombectomy Products
    SpiderFX and SpiderRX Embolic Protection
    Devices.
  and/or
  Helix Clot Buster Thrombectomy Device.
  Blood Clot Therapy Products or Infusion
    Catheters.
  Carotid
    Stenting Solutions
   10




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PTA
    Balloons and Other Procedural Support Products
    Balloon Angioplasty Catheters.
      
    unmatched longer lengths (up to 200 cm) which allows a
    physician to use a single balloon once (vs. a shorter length
    balloon multiple times),
    low tip entry and crossing profile optimizing the ability to
    cross tight lesions, and
    robust catheter shaft and flexible balloon design enhancing the
    ability to reach the desired treatment area.    
    Bevel 360 technology optimizing the ability to cross tight
    lesions;
    catheter design providing optimal pushability and trackability
    to reach the target vessel area of the diseased vessel; and
    increased inner diameter catheter lumen allowing for
    dramatically reduced deflation times. 11




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Goose Neck Snares and Microsnares.
  Nitrex Guidewires.
  Our
    Neurovascular Markets
  Neurovascular
    Disease and Strokes
    
    Ischemic stroke, which is caused by the blockage of an
    artery to the brain; or
    Hemorrhagic stroke, which is caused by a sudden rupture
    of a brain artery, leading to bleeding into or around the brain.     12




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1 4
    Neurovascular
    Market
    15-20%
 13




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200-500 10-58%
  Treatment
    Options
    Ischemic Strokes. and/or
  and/or
      Hemorrhagic Strokes.
   14




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The Lancet The
    Lancet
   15




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65-70%
    Our
    Neurovascular Product Portfolio
    Embolic
    Coils
    Axium Detachable Coil System.
  
    a high degree of coil conformability, which facilitates the
    physicians goal of more easily and completely filling and
    packing the aneurysm, regardless of its shape and size; 16




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
    coil softness combined with stretch resistance, which allows the
    coil to be positioned or re-positioned within the aneurysm
    without adding to the risk of bleeding or hemorrhagic stroke;
    ease of coil placement though the microcatheter, providing the
    physician with enhanced control and deliverability; and
    rapid, safe and simple detachment of the coil through a
    proprietary, micro-machined instant detachment system that
    offers instantaneous coil detachment without the use of wires or
    syringes, which facilitates precise and rapid coil deployment
    while minimizing procedure time, which may be especially
    important in a ruptured aneurysm or when blood flow to the brain
    has been restricted.  Nexus Embolic Coils.
  NXT.
  Liquid
    Embolics
    Onyx Liquid Embolic System.
   17




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Flow
    Directed and Other Micro Catheters
    UltraFlow and Marathon Flow Directed Micro
    Catheters.
  Echelon and Pre-shaped Echelon Micro
    Catheters.
  Other Micro Catheters.
  Occlusion
    Balloon Systems
  HyperForm and HyperGlide Occlusion Balloon
    Systems.
  Guidewires
  Hydrophilic Guidewires.
  Neuro
    Stents
   18




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Sales,
    Marketing and Distribution
  Structure
    and Strategy
      United
    States
      Europe
    and Canada
   19




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Other
    International
    Manufacturing
    Research
    and Development
      
    broadening acquired technologies in order to address a larger
    share of the target markets;
    incorporating important features which we believe appeal to the
    physicians who use our products; and
    leveraging core technologies to develop new product platforms
    and enter new markets.    Clinical
    Studies
  and/or
 20




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and/or
    Peripheral
    Stent Clinical Trials:
  Trial

Product

Study Design

StatusPROVE-IT (U.S.)

EverFlex stent, Protégé GPS stent, and Visi-Pro stent

Prospective, multi-center, non-randomized, 2-arm study to
    evaluate the safety and effectiveness of primary stenting
    compared to PTA performance goals for the treatment of iliac
    lesions

Enrollment anticipated to begin 2010Primary safety endpoint of 30-day major adverse event
    (self-expanding stent arm)Primary effectiveness endpoint of 9-month patency by duplex
    (self-expanding stent arm)Primary composite endpoint of acute procedure success and 30-day
    major adverse event (balloon expandable stent arm)DURABILITY II (U.S.)

EverFlex Stent

Prospective, multi-center, non-randomized study to evaluate the
    safety and effectiveness of the primary stenting compared to PTA
    performance goals for the treatment of SFA lesions

Enrollment and follow-up continuingPrimary safety endpoint of 30-day major adverse eventPrimary effectiveness endpoint of 12-month patency by duplex  21




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SilverHawk
    Clinical Trials:
  Trial

Product

Study Design

StatusDEFINITIVE
    Ca++

    (U.S.)

SilverHawk Peripheral Calcium Tip Plaque Excision System with
    SpiderFX Embolic Protection Device

Prospective, multi-center, non-randomized, single-arm study to
    evaluate the safety and effectiveness of the SilverHawk with
    Calcium Tip (i.e. RockHawk) Plaque Excision System when used in
    conjunction with the SpiderFX Embolic Protection Device in the
    treatment of moderate to heavily calcified lesions in the
    femoropopliteal arteries

Enrollment initiated in October 2008DEFINITIVE LE (Global)

SilverHawk

Prospective, multi-center, non-randomized, single-arm study to
    evaluate the intermediate and long-term effectiveness of
    stand-alone SilverHawk Atherectomy Catheter for endovascular
    treatment of peripheral arterial disease in femoropopliteal or
    tibial-peroneal arteries.

Enrollment anticipated to begin in first half of 2009   Carotid
    Clinical Trials:
  Trial

Product

Study Design

StatusCREATE PAS (U.S)

Protégé GPS Stent with an ev3 Embolic Protection Device

Prospective, multi-center single-arm confirmatory post-approval
    study

Enrollment and follow-up continuingPrimary endpoint of major adverse cardiovascular and cerebral
    event rate in broad use at investigative centers   Neuro
    Clinical Trials:
  Trial

Product

Study Design

StatusSWIFT  Solitaire Stent Flow Restoration Trial

Solitaire Stent

In development

Enrollment anticipated to begin third quarter 2009US IDE, prospective, single-arm, multi-center studyFDA approvalRACER  Axium Post Market and Expanded Approvals Trial

Axium Coil

Prospective, single-arm, multi-center study

Enrollment began second quarter 2008Scientific clinical data and possible regulatory submissions  22




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Government
    Regulation
  United
    States
    
    product design, development and manufacture;
    conduct of clinical trials;
    product safety, testing, labeling and storage;
    submission to FDA for pre-marketing clearance or approval;
    record keeping procedures;
    product marketing, sales and distribution; and
    post-marketing surveillance, reporting of deaths or serious
    injuries and medical device reporting.    510(k) Clearance Pathway.
  and/or
 23




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Pre-Market Approval Pathway.
    Clinical Trials.
  and/or
    De Novo Pathway.
 24




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Humanitarian Device Exemptions.
  Post-Marketing Requirements.
  
    Quality System Regulations, which require manufacturers to
    follow design, testing, control, documentation and other quality
    assurance procedures during the manufacturing process;
    labeling, advertising and promotion regulations, which govern
    product labels and labeling, prohibit the promotion of products
    for unapproved or off-label uses and impose other
    restrictions on labeling and promotional activities;
    medical device reporting regulations, which require that
    manufacturers report to the FDA if their device may have caused
    or contributed to a death or serious injury or malfunctioned in
    a way that would likely cause or contribute to a death or
    serious injury if it were to recur; and
    notices of correction or removal, and recall regulations.      
    warning letters, fines, injunctions, and civil penalties;
    repair, replacement, refund, recall or seizure of our products;
    operating restrictions, partial suspension or total shutdown of
    production;
    refusing a request for 510(k) clearance or pre-market approval
    of new products;
    withdrawing 510(k) clearance or pre-market approvals that are
    already granted; and
    criminal prosecution. 25




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International
         26




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Fraud
    and Abuse Laws
      Privacy
    and Security
      Third
    Party Reimbursement
   27




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International
    Trade
    Environmental
    Competition
   28




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start-up
      
    continue to innovate and maintain scientifically advanced
    technology, being responsive to the changing needs of our
    diverse customer base;
    apply our technology across disease states, product lines and
    markets;
    attract and retain skilled personnel;
    obtain and maintain regulatory approvals; and
    cost-effectively manufacture and successfully market our
    products.  Employees
    Intellectual
    Property Rights
     29




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and/or
        Forward-Looking
    Statements
  Form 10-K and/or
   30




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Form 10-Q Form 8-K
  Available
    Information
  (763) 398-7000, www.ev3.net
  Form 10-K, Form 10-Q, Form 8-K, (949) 680-1375.
  ITEM 1A.
    RISK
    FACTORS    Risks
    Related to Our Business and Industry
  Current
    worldwide economic conditions may result in reduced procedures
    using our products, which would adversely affect our net
    sales.
    31




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Current
    worldwide economic conditions may have other adverse
    implications on our business, operating results and financial
    condition.
    Disruptions
    in the global financial markets could impact the ability of our
    counterparties and others to perform their obligations to us and
    our ability to obtain any additional future financing if needed
    or desired.
  and/or
  We
    have a history of net losses and no assurance can be provided
    that we will achieve our goal of sustained
    profitability.
   32




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Our
    business strategy relies on assumptions about the market for our
    products, which, if incorrect, would adversely affect our
    business and operating results.
    Our
    marketing activities are subject to regulation regarding the
    promotion of off-label uses, which restrict our
    ability to market our products. If we are found to have
    improperly promoted off-label use of our products, we may become
    subject to enforcement action by the FDA or the
    U.S. Department of Justice
    and/or incur
    significant liabilities. Any off-label use of our products also
    may result in injuries that could lead to product liability
    claims against us.
  and/or
     33




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If we
    fail to comply with laws prohibiting kickbacks and
    false or fraudulent claims and other similar laws, we could be
    subject to criminal and civil penalties and exclusion from
    governmental health care programs, which could have a material
    adverse effect on our business and operating
    results.
   34




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and/or
  Some
    of our products are emerging technologies or have only recently
    been introduced into the market. If physicians do not recommend
    and endorse them or if our working relationships with physicians
    deteriorate, our products may not be accepted in the
    marketplace, which would adversely affect our business and
    operating results.
      Demand
    for our atherectomy products in the United States has suffered
    due in part, we believe, to the lack of long-term clinical data
    regarding their safety and efficacy. Future long-term data
    regarding the safety and efficacy of our atherectomy products
    may not be positive or consistent with data currently available,
    which would adversely affect their market acceptance and our
    operating results.
   35




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The
    demand for our products, the prices which customers and patients
    are willing to pay for our products and the number of procedures
    performed using our products depend upon the ability of our
    customers and patients to obtain sufficient third party
    reimbursement for their purchases of our products.
  country-by-country
 36




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and/or
      Our
    stents and atherectomy products generate a significant portion
    of our product sales. Accordingly, if sales of these products
    were to decline, our operating results would be adversely
    affected.
    Our
    products face the risk of technological obsolescence, which, if
    realized, could have a material adverse effect on our business
    and operating results.
   37




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Our
    future success depends in part on the introduction of new
    products. Failure to introduce and market new products in a
    timely fashion that are accepted by the marketplace could
    adversely affect our business and operating
    results.
        A
    number of our proposed products are in the early stages of
    development and some are in clinical trials. If the development
    of these products is not successfully completed or if these
    trials are unsuccessful, or if the U.S. Food and Drug
    Administration, or FDA, or other regulatory agencies require
    additional trials to be conducted, these products may not be
    commercialized and our business prospects may
    suffer.
       38




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and/or
  Our
    future success depends in part on our ability to sell our
    atherectomy and other products internationally. There are risks
    inherent in operating internationally and selling and shipping
    our products and purchasing our components internationally,
    which may adversely impact our business, operating results and
    financial condition.
      and/or
  
    the imposition of additional U.S. and foreign governmental
    controls or regulations;
    the imposition of costly and lengthy new export licensing
    requirements;
    the imposition of
    U.S. and/or
    international sanctions against a country, company, person or
    entity with whom the company does business that would restrict
    or prohibit continued business with the sanctioned country,
    company, person or entity;
    a shortage of high-quality sales people and distributors;
    loss of any key personnel that possess proprietary knowledge, or
    who are otherwise important to our success in certain
    international markets;
    the imposition of different reimbursement requirements and
    changes in reimbursement policies that may require some of the
    patients who receive our products to directly absorb medical
    costs or that may necessitate the reduction of the selling
    prices of our products;
    changes in duties and tariffs, license obligations and other
    non-tariff barriers to trade;
    the imposition of new trade restrictions;
    the imposition of restrictions on the activities of foreign
    agents, representatives and distributors;
    scrutiny of foreign tax authorities which could result in
    significant fines, penalties and additional taxes being imposed
    on us;
    pricing pressure that we may experience internationally; 39




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
    laws and business practices favoring local companies;
    significantly longer payment cycles;
    difficulties in maintaining consistency with our internal
    guidelines;
    difficulties in enforcing agreements and collecting receivables
    through certain foreign legal systems;
    difficulties in enforcing or defending intellectual property
    rights;
    exposure to different legal and political standards due to our
    conducting business in over 60 countries; and
    fluctuation in the rate of exchange between the U.S. dollar
    and foreign currencies which may make the effective price of our
    products more expensive to our distributors in foreign markets.    Fluctuations
    in the rate of exchange between the U.S. dollar and foreign
    currencies in which we transact business could adversely affect
    our financial results or cause our results to
    fluctuate.
  non-U.S. dollar non-U.S. dollar
   40




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A
    substantial portion of our assets consist of goodwill and other
    intangible assets and any future additional impairment in the
    value of our goodwill and other intangible assets would have the
    effect of decreasing our earnings or increasing our
    losses.
  and/or
  We may
    be subject to intellectual property litigation and infringement
    claims, which could cause us to incur liabilities and costs,
    prevent us from selling our products, cause us to redesign our
    products, require us to enter into costly license agreements and
    result in other adverse consequences.
     41




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
    be expensive and time consuming to defend;
    result in us being required to pay significant damages to third
    parties;
    cause us to cease making or selling products that incorporate
    the challenged intellectual property;
    require us to redesign, reengineer or rebrand our products, if
    feasible;
    require us to enter into license agreements in order to obtain
    the right to use a third partys intellectual property,
    which agreements may require us to pay significant license fees,
    including royalties, or may not be available on terms acceptable
    to us or at all and which licenses may be non-exclusive, which
    could provide our competitors access to the same technologies;
    divert the attention of our management and other personnel from
    other business issues; or
    result in our customers or potential customers deferring or
    limiting their purchase or use of the affected products until
    resolution of the litigation.    If our
    patents and other intellectual property rights do not adequately
    protect our products, we may lose market share to our
    competitors, which would harm our business.
   42




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We
    manufacture our products at single locations. Any disruption in
    these manufacturing facilities, any patent infringement claims
    with respect to our manufacturing process or otherwise any
    inability to manufacture a sufficient number of our products to
    meet demand could adversely affect our business and operating
    results.
   43




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Our
    dependence on key suppliers puts us at risk of interruptions in
    the availability of our products, which could reduce our net
    sales and adversely affect our operating results. In addition,
    increases in prices for raw materials and components used in our
    products could adversely affect our operating
    results.
        Significant
    and unexpected claims under our EverFlex self-expanding stent
    worldwide fracture-free guarantee program in excess of our
    reserves could significantly harm our business, operating
    results and financial condition.
   44




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Our
    inability to successfully grow through future acquisitions, our
    failure to integrate any acquired businesses successfully into
    our existing operations or our discovery of previously
    undisclosed liabilities could negatively affect our business and
    operating results.
    
    difficulties in integrating any acquired companies, personnel
    and products into our existing business;
    delays in realizing projected efficiencies, cost savings,
    revenue synergies and other benefits of the acquired company or
    products;
    inaccurate assessment of the future market size or market
    acceptance of any acquired products or technologies or the
    hurdles in obtaining regulatory approvals of such products;
    inaccurate assessment of undisclosed, contingent or other
    liabilities or problems;
    diversion of our managements time and attention from other
    business concerns;
    limited or no direct prior experience in new markets or
    countries we may enter;
    higher costs of integration than we anticipated;
    adverse accounting consequences under recently revised
    accounting rules; or
    difficulties in retaining key employees of the acquired business
    who are necessary to manage the acquired business.   45




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Consolidation
    in the healthcare industry could lead to demands for price
    concessions or to the exclusion of some suppliers from certain
    of our markets, which could have an adverse effect on our
    business, financial condition or operating
    results.
    Our
    products and our product development and marketing activities
    are subject to extensive regulation as a result of which we may
    not be able to obtain required regulatory approvals for our
    products in a cost-effective manner or at all, which could
    adversely affect our business and operating
    results.
      
    imposing fines and penalties on us;
    preventing us from manufacturing or selling our products;
    bringing civil or criminal charges against us;
    delaying the introduction of our new products into the market;
    suspending any ongoing clinical trials;
    issuing an injunction preventing us from manufacturing or
    selling our products or imposing restrictions;
    recalling or seizing our products; or
    withdrawing or denying approvals or clearances for our products. 46




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Our
    failure to comply with applicable regulatory requirements may
    also result in us not being able to meet the demands of our
    customers and our customers canceling orders or purchasing
    products from our competitors, which could adversely affect our
    business and operating results.
      If we
    or others identify side effects after any of our products are on
    the market, we may be required to withdraw our products from the
    market, which would hinder or preclude our ability to generate
    sales.
    
    regulatory authorities may withdraw their approvals;
    we may be required to redesign or reformulate our products;
    we may have to recall the affected products from the market and
    may not be able to reintroduce them onto the market;
    our reputation in the marketplace may suffer; and
    we may become the target of lawsuits, including class action
    suits.    Our
    manufacturing facilities are subject to extensive governmental
    regulation with which compliance is costly and which expose us
    to penalties for non-compliance.
   47




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Our
    operations are subject to environmental, health and safety, and
    other laws and regulations, with which compliance is costly and
    which expose us to penalties for non-compliance.
    We may
    require additional capital in the future, which may not be
    available or may be available only on unfavorable terms. In
    addition, any equity financings may be dilutive to our
    stockholders.
    Our
    quarterly operating results are subject to substantial
    fluctuations and you should not rely on them as an indication of
    our future results.
    
    the seasonality of our product sales, which typically results in
    higher demand in our fourth fiscal quarter and lower sales
    volumes in our third fiscal quarter; 48




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
    the mix of our products sold;
    demand for, and pricing of, our products and the products of our
    competitors;
    timing of or failure to obtain regulatory approvals for products;
    costs, benefits and timing of new product introductions by us
    and our competitors;
    increased competition;
    the timing and extent of promotional pricing or volume discounts;
    the timing of larger orders by customers and the timing of
    shipment of such orders;
    field inventory levels;
    changes in average selling prices;
    the availability and cost of components and materials;
    fluctuations in foreign currency exchange rates;
    the possible deferral of revenue under our revenue recognition
    policies;
    the timing of operating expenses in anticipation of sales;
    unanticipated expenses;
    costs related to acquisitions of technologies or businesses;
    restructuring, impairment and other special charges; and
    fluctuations in investment returns on invested cash balances.    We may
    become obligated to make large milestone payments that are not
    reflected in our consolidated financial statements in certain
    circumstances, which would negatively impact our cash flows from
    operations.
     49




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and/or
  We
    rely on independent sales distributors and sales associates to
    market and sell our products outside of the United States,
    Canada and Europe.
    We are
    exposed to product liability claims that could have an adverse
    effect on our business and operating results.
    We
    face competition from other companies, which could adversely
    impact our business and operating results.
   50




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start-up
    We
    rely on our management information systems for accounting and
    finance, inventory management, distribution and other functions
    and to maintain our research and development and clinical data.
    If our information systems fail to adequately perform these
    functions or if we experience an interruption in their
    operation, our business and operating results could be adversely
    affected.
    
    earthquake, fire, flood and other natural disasters;
    terrorist attacks and attacks by computer viruses or hackers;
    and power loss or computer systems, Internet, telecommunications
    or data network failure.   51




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We
    face a risk of non-compliance with certain financial covenants
    in our loan agreement with Silicon Valley Bank. If we are unable
    to meet the financial or other covenants under the agreement or
    negotiate future waivers or amendments of the covenants, we
    could be in default under the agreement, which would give
    Silicon Valley Bank a range of remedies, including declaring all
    outstanding debt to be due and payable, foreclosing on the
    assets securing the loan agreement
    and/or
    ceasing to provide additional revolving loans or letters of
    credit, which could have a material adverse effect on
    us.
  and/or
  The
    restrictive covenants in our loan agreement could limit our
    ability to conduct our business and respond to changing economic
    and business conditions and may place us at a competitive
    disadvantage relative to other companies that are subject to
    fewer restrictions.
    
    transfer all or any part of our business or properties;
    permit or suffer a change in control;
    merge or consolidate, or acquire any entity;
    engage in any material new line of business;
    incur additional indebtedness or liens with respect to any of
    their properties;
    pay dividends or make any other distribution on or purchase of,
    any of their capital stock;
    make investments in other companies; or
    engage in related party transactions,   52




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We
    have experienced recently certain changes in our management
    which could cause certain ev3 key employees to depart because of
    difficulties with change or a desire not to remain with our
    company.
    If we
    become profitable, we cannot assure you that our net operating
    losses will be available to reduce our tax
    liability.
    Risks
    Related to our Common Stock
  One of
    our principal stockholders and its affiliates are able to
    influence matters requiring stockholder approval and could
    discourage the purchase of our outstanding shares at a
    premium.
   53




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Certain
    of our principal stockholders may have conflicts of interests
    with our other stockholders or our company in the
    future.
    
    create competing financial demands on our principal stockholders;
    create potential conflicts of interest; and
    require efforts consistent with applicable law to keep the other
    businesses separate from our operations.    Our
    corporate documents and Delaware law contain provisions that
    could discourage, delay or prevent a change in control of our
    company.
      A
    large percentage of our outstanding common stock is held by
    insiders, and, as a result, the trading market for our common
    stock will not be as liquid as the stock of other public
    companies, and our common stock price could be
    volatile.
   54




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
    the introduction of new products or product enhancements by us
    or our competitors;
    changes in our growth rate or our competitors growth rates;
    strategic actions by us or our competitors, such as acquisitions
    or restructurings;
    our ability to develop, obtain regulatory clearance or approval
    for, and market new and enhanced products on a timely basis;
    loss of any of key management personnel;
    disputes or other developments with respect to intellectual
    property rights;
    product liability claims or other litigation;
    public concern as to the safety or efficacy of our products;
    the publics reaction to our press releases and other
    public announcements and our filings with the SEC;
    sales of common stock by us, our significant stockholders,
    executive officers or directors;
    changes in stock market analyst recommendations or earnings
    estimates regarding our common stock, other comparable companies
    or our industry generally;
    changes in expectations or future performance;
    new laws or regulations or new interpretations of existing laws
    or regulations applicable to our business; and
    changes in health care policy in the United States and
    internationally, including changes in the availability of
    third-party reimbursement.    We do
    not intend to pay dividends for the foreseeable
    future.
    ITEM 1B.
    UNRESOLVED
    STAFF COMMENTS    ITEM 2.
    PROPERTIES   55




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ITEM 3.
    LEGAL
    PROCEEDINGS    ITEM 4.
    SUBMISSION
    OF MATTERS TO A VOTE OF SECURITY HOLDERS    ITEM 4A.
    EXECUTIVE
    OFFICERS OF THE REGISTRANT    Name

Age

PositionRobert J. Palmisano


64


President and Chief Executive OfficerPascal E.R. Girin


49


Executive Vice President and President, Worldwide Neurovascular
    and InternationalStacy Enxing Seng


44


Executive Vice President and President, U.S. Peripheral VascularKevin M. Klemz


47


Senior Vice President, Secretary and Chief Legal OfficerShawn McCormick


44


Senior Vice President and Chief Financial OfficerGregory Morrison


45


Senior Vice President, Human ResourcesDavid H. Mowry


46


Senior Vice President, Strategic and Corporate OperationsJulie D. Tracy


47


Senior Vice President and Chief Communications Officer  56




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Robert J. Palmisano
  Pascal E.R. Girin
  Stacy Enxing Seng
  Kevin M. Klemz
  Shawn McCormick
  Gregory Morrison
 57




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David H. Mowry
  Julie D. Tracy
 58




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PART II  ITEM 5.
    MARKET
    FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS
    AND ISSUER PURCHASES OF EQUITY SECURITIES  Market
    Price
      High


Low2008First Fiscal Quarter

$
12.72


$
7.36Second Fiscal Quarter

$
10.69


$
7.32Third Fiscal Quarter

$
12.58


$
8.60Fourth Fiscal Quarter

$
9.92


$
3.37   High


Low2007First Fiscal Quarter

$
21.34


$
17.03Second Fiscal Quarter

$
21.54


$
16.42Third Fiscal Quarter

$
19.46


$
15.06Fourth Fiscal Quarter

$
18.84


$
11.66   Number of
    Record Holders; Dividends
    Recent
    Sales of Unregistered Equity Securities
   59




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Issuer
    Purchases of Equity Securities
  Rule 10b-18(a)(3)
  Total Number of


Maximum Number ofTotal





Shares Purchased as


Shares that May YetNumber


Average Price


Part of Publicly


Be Purchased Underof Shares


Paid Per


Announced Plans or


the Plans orPeriod

Purchased(1)


Share


Programs(2)


Programs(2)Month # 1 (September 29, 2008  November 2,
    2008)


3,849


$
9.01



N/A



N/AMonth # 2 (November 3, 2008  November 30,
    2008)


38,255



5.82



N/A



N/AMonth # 3 (December 1, 2008  December 31,
    2008)










N/A



N/ATotal:


42,104


$
6.11



N/A



N/A     (1)
    
    Consists of shares repurchased from employees in connection with
    the required payment of withholding or employment-related tax
    obligations due in connection with the vesting of restricted
    stock awards.(2)
    
    Our board of directors has not authorized any repurchase plan or
    program for purchase of shares of our common stock or other
    equity securities on the open market or otherwise, other than an
    indefinite number of shares in connection with the cashless
    exercise of outstanding stock options and the surrender of
    shares of our common stock upon the issuance or vesting of stock
    grants to satisfy any required withholding or employment-related
    tax obligations.   60




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Stock
    Performance Graph
      COMPARISON
    OF 42 MONTH CUMULATIVE TOTAL RETURN*
 
  
  *
    $100 invested on
    6/16/05 in
    stock &
    5/31/05 in
    index-including reinvestment of dividends.
    Fiscal year ending December 31.  The foregoing Stock Performance Graph shall not be deemed to
    be filed with the Securities and Exchange Commission
    or subject to the liabilities of Section 18 of the
    Securities Exchange Act of 1934, as amended. Notwithstanding
    anything to the contrary set forth in any of our previous
    filings under the Securities Act of 1933, as amended, or the
    Securities Exchange Act of 1934, as amended, that might
    incorporate future filings, including this annual report on
    Form 10-K,
    in whole or in part, the foregoing Stock Performance Graph shall
    not be incorporated by reference into any such filings.
 61




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ITEM 6.
    SELECTED
    FINANCIAL DATA    For the Year Ended December 31,2008


2007(1)


2006


2005


2004(Dollars in thousands, except per unit and per share
    amounts)Results of Operations:Sales:Product sales

$
402,233


$
278,226


$
202,438


$
133,696


$
86,334Research collaboration


19,895



5,957











Net sales


422,128



284,183



202,438



133,696



86,334Operating expenses:Product cost of goods sold


136,847



99,879



71,321



55,094



39,862Research collaboration


6,051



1,065











Sales, general and administrative


231,957



195,267



141,779



130,427



103,031Research and development


48,784



48,413



26,725



39,280



38,917Amortization of intangible assets


31,072



20,306



17,223



10,673



9,863Goodwill and other intangible asset impairment(2)


299,263















Loss (gain) on sale or disposal of assets, net


243



(978
)


162



200



(14,364
)Acquired in-process research and development






70,700



1,786



868



Special charges(3)






19,054











Total operating expenses


754,217



453,706



258,996



236,542



177,309Loss from operations


(332,089
)


(169,523
)


(56,558
)


(102,846
)


(90,975
)Other (income) expense:Realized and unrealized (gain) loss on investments, net


(487
)


116



(1,063
)


(4,611
)


(1,728
)Interest (income) expense, net


(223
)


(1,910
)


(1,695
)


9,916



25,428Minority interest in loss of subsidiary














(2,013
)


(13,846
)Other expense (income), net


2,427



(2,934
)


(2,117
)


3,360



(1,752
)Loss before income taxes


(333,806
)


(164,795
)


(51,683
)


(109,498
)


(99,077
)Income tax expense


1,816



949



688



526



196Net loss


(335,622
)


(165,744
)


(52,371
)


(110,024
)


(99,273
)Accretion of preferred membership units to redemption value(4)














12,061



23,826Net loss attributable to common unit/share holders

$
(335,622
)

$
(165,744
)

$
(52,371
)

$
(122,085
)

$
(123,099
)Net loss per common unit/share(5): Basic and diluted

$
(3.22
)

$
(2.37
)

$
(0.93
)

$
(4.48
)

$
(57.44
)Weighted average units/shares outstanding:Basic and diluted


104,378,828



69,909,708



56,585,025



27,242,712



2,142,986  62




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(1)
    
    We acquired FoxHollow Technologies, Inc. on October 4,
    2007. The acquisition was accounted for under the purchase
    method of accounting and the results of operations of FoxHollow
    have been included in our consolidated operating results as of
    the acquisition date. In connection with the acquisition, we
    recorded $14.9 million of integration costs associated with
    the acquisition and recognized $70.7 million for in-process
    research and development charges. For a more complete
    description of these items and their impact on our consolidated
    financial results, see Note 5 to our consolidated financial
    statements.(2)
    
    During the fourth fiscal quarter 2008, we recorded
    $288.8 million in non-cash, asset impairment charges in our
    peripheral vascular segment to reduce the carrying values of
    goodwill and certain other intangible assets to their estimated
    fair values. Additionally, during the second fiscal quarter
    2008, as a result of the termination of our research
    collaboration with Merck & Co, Inc., we recorded an
    asset impairment charge of $10.5 million to write-off the
    remaining carrying value of the related Merck intangible asset
    that was established at the time of our acquisition of
    FoxHollow. For a more complete description of these items and
    their impact on our consolidated financial results, see
    Note 10 to our consolidated financial statements.(3)
    
    During the third fiscal quarter 2007, we recorded
    $19.1 million as a result of the settlement of the global
    coil patent litigation with the Regents of the University of
    California and Boston Scientific Corporation.(4)
    
    The accretion of preferred membership units to redemption value
    presented above is based on the rights to which the Class A
    and Class B preferred membership unit holders of ev3 LLC
    were entitled related to a liquidation, dissolution or winding
    up of ev3 LLC. Notwithstanding this accretion right, in
    connection with the merger of ev3 LLC with and into ev3 Inc.,
    each membership unit representing a preferred equity interest in
    ev3 LLC was converted into one share of our common stock and did
    not receive any additional rights with respect to the
    liquidation preference. Accretion was discontinued upon
    conversion of the preferred units to common equity at the time
    of our initial public offering on June 21, 2005.(5)
    
    Net loss per common unit/share and number of units/shares used
    in per unit/share calculations reflect our June 21, 2005
    one for six reverse stock split for all periods presented.  As of December 31,2008


2007


2006


2005


2004(dollars in thousands)Balance Sheet Data:Cash and cash equivalents

$
59,652


$
81,060


$
24,053


$
69,592


$
20,131Short-term investments






9,744



14,700



12,000



Current assets


187,123



228,370



135,845



151,675



68,609Total assets


720,664



1,087,106



352,826



296,828



212,046Current liabilities, excluding demand notes


67,448



119,159



41,767



37,671



36,025Demand notes payable-related parties


















299,453Long-term debt


6,458



6,429



5,357







Total liabilities


80,123



128,625



47,592



38,523



336,180Preferred membership units


















254,028Total members and stockholders equity (deficit)


640,541



958,481



305,234



245,455



(394,472
)  63




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ITEM 7.
    MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATIONS    
    Business Overview.  This section provides a
    brief overview description of our business, focusing in
    particular on developments during the most recent fiscal year.
    Summary of 2008 Results and 2009 Outlook.  This
    section provides a brief summary of our financial results and
    financial condition for 2008 and our outlook for 2009.
    Sales and Expense Components.  This section
    provides a brief description of the significant line items in
    our consolidated statements of operations.
    Results of Operations.  This section provides
    our analysis of the significant line items in our consolidated
    statements of operations.
    Seasonal and Quarterly Fluctuations.  This
    section describes the effects of seasonal and quarterly
    fluctuations in our business.
    Liquidity and Capital Resources.  This section
    provides an analysis of our liquidity and cash flows and a
    discussion of our outstanding debt and commitments.
    Critical Accounting Policies and
    Estimates.  This section discusses the accounting
    estimates that are considered important to our financial
    condition and results of operations and require us to exercise
    subjective or complex judgments in their application. All of our
    significant accounting policies, including our critical
    accounting estimates, are summarized in Note 2 to our
    consolidated financial statements.
    Recently Issued Accounting
    Pronouncements.  This section discusses recently
    issued accounting pronouncements that have had or may affect our
    results of operations and financial condition.  Business
    Overview
     64




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65




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66




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##### Table of Contents



and/or
  Summary
    of 2008 Financial Results and Outlook for 2009
      
    Our net sales increased 49% in 2008 compared to 2007. We
    attribute this increase primarily to the addition of atherectomy
    product sales as a result of our acquisition of FoxHollow,
    expansion in our neurovascular and international businesses and
    increased sales of our other peripheral vascular products. Our
    net sales of $422.1 million for 2008 included product net
    sales of $269.9 million in our peripheral vascular segment,
    $132.3 million in our neurovascular segment and
    $19.9 million of research collaboration revenue. As a
    result of the termination of our collaboration and license
    agreement with Merck, we do not expect any future research
    collaboration revenue.
    Net sales of our peripheral vascular products increased 55% to
    $269.9 million in 2008 compared to 2007. This sales growth
    was primarily the result of our FoxHollow acquisition and
    increased market penetration of our EverFlex family of stents.
    Our 2008 net sales included $88.8 million of
    atherectomy product sales, which we believe were significantly
    hampered by a relatively flat demand for atherectomy products in
    general and a decreased demand for our SilverHawk atherectomy
    products in particular. We believe we lost market share during
    2008 as a result of increased competition and related physician
    trialing of competitive devices, increased turnover in our
    U.S. peripheral vascular sales organization and a loss of
    focus of our sales organization on our SilverHawk atherectomy
    products. Although we expect to continue to face intense
    competition during 2009, we remain optimistic about the longer
    term outlook for our atherectomy products. One of our focuses
    for 2009 and beyond is to increase our atherectomy sales by
    improving our sales execution and productivity, adding new
    plaque excision products and developing definitive clinical data
    to support procedural expansion. With respect to our stents, we
    expect continued penetration with our EverFlex family of stents
    in 2009, although we are cautious of the current regulatory
    environment regarding the promotion of off-label devices and
    increased competition we believe we may experience.
    Net sales of our neurovascular products increased 27% to
    $132.3 million in 2008 compared to $104.4 million in
    2007 as a result of increased penetration of new and existing
    products and sales growth in virtually all of our neurovascular
    access and delivery products. Net sales of our embolic 67




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products increased 33% to $74.7 million in 2008 compared to
    2007 primarily due to the launch of the Axium coil and increased
    market penetration of the Onyx Liquid Embolic System. We believe
    the Axium coil will continue to be a primary source of growth
    for our neurovascular business in 2009. We believe our
    neurovascular business should benefit in 2009 by continued
    penetration of our Axium coils, new product introductions,
    expanded geographic presence and improved pricing.  
    On a geographic basis, 65% of our net sales for 2008 were
    generated in the United States and 35% were generated outside
    the United States. Our international net sales increased 37% to
    $146.7 million in 2008 compared to 2007 primarily due to
    the launch of the Axium coil, further market penetration of the
    EverFlex family of stents and the Onyx Liquid Embolic System and
    the continued penetration of our atherectomy products into
    international markets. We expect our international business to
    benefit from our ability to sell our recently launched PTA
    balloon catheters, the EverCross and the NanoCross, outside the
    United States since we were unable to distribute Invatecs
    balloon catheters outside the United States. Changes in foreign
    currency exchange rates had a positive impact of approximately
    $5.0 million on our 2008 net sales compared to 2007,
    principally resulting from the relationship of the
    U.S. dollar as compared to the Euro, but had a negative
    impact of approximately $2.7 million on our fourth fiscal
    quarter 2008 net sales compared to our fourth fiscal
    quarter 2007 net sales. We expect foreign currency exchange
    rates to have a negative impact on our 2009 net sales
    compared to our 2008 net sales.
    As a percentage of product sales, product cost of goods sold was
    34% of product sales in 2008 compared to 36% in 2007. In our
    peripheral vascular segment, product cost of goods sold as a
    percent of product sales decreased to 38% in 2008 compared to
    42% in 2007 primarily attributable to manufacturing efficiencies
    and increased sales volumes, partially offset by costs
    associated with the consolidation of our Redwood City
    manufacturing operations into our Irvine and Plymouth
    facilities. In our neurovascular segment, product cost of goods
    sold as a percent of product sales was 26% in 2008 and 2007 and
    was attributable to manufacturing efficiencies and increased
    sales volume, partially offset by additional excess and obsolete
    inventory reserves related to our planned product transitions to
    next generation devices. We expect our product cost of goods
    sold as a percentage of product sales to decrease in 2009
    compared to 2008 primarily as a result of anticipated better
    pricing, more favorable product mix, better margins on our PTA
    balloon catheters and continued benefits from our focus on lean
    manufacturing programs.
    Although our sales, general and administrative expenses
    increased in absolute dollars in 2008 compared to 2007, such
    expenses decreased as a percentage of net sales. We expect our
    sales, general and administrative expenses as a percentage of
    net sales to continue to decrease in 2009 compared to 2008
    primarily as a result of our anticipated optimization of our
    cost structure. We expect to continue to focus on our vital few
    programs and implement systems and processes to improve our
    sales execution.
    We experienced several one-time, non-cash charges in 2008.
    During fourth fiscal quarter 2008, we recorded an aggregate of
    $288.8 million in non-cash, asset impairment charges in our
    peripheral vascular segment to reduce the carrying values of
    goodwill and other intangible assets to their estimated fair
    values. The impairment charges were driven primarily by the
    substantial disruption in the general credit and equity markets
    and in particular the decline in our stock price and market
    capitalization and certain product discontinuations during our
    fourth fiscal quarter. Additionally, during the second fiscal
    quarter 2008, as a result of the termination of our research
    collaboration with Merck, we recorded a non-cash asset
    impairment charge of $10.5 million to write-off the
    remaining carrying value of the related Merck intangible asset
    that was established at the time of our acquisition of FoxHollow.
    Our net loss for 2008 was $335.6 million, or $3.22 per
    common share. Our goal for 2009 and beyond is to obtain
    sustained profitability.
    Our cash and cash equivalents were $59.7 million at
    December 31, 2008, an increase of $13.7 million
    compared to the end of the third fiscal quarter 2008. This
    increase was primarily due to cash provided by operating
    activities during the fourth fiscal quarter 2008. We believe our
    cash and cash equivalents 68




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and current financing arrangements will be sufficient to meet
    our liquidity requirements through at least the next
    12 months. We expect to continue to focus on improving our
    cash position during 2009.  Sales and
    Expense Components
    Product net sales.
  Research collaboration (revenue).
  Product cost of goods sold.
  Research collaboration (expense).
  Sales, general and administrative.
  Research and development.
  Amortization of intangible assets.
  Goodwill and other intangible asset
    impairment.
 69




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Loss (gain) on sale or disposal of assets,
    net.
  Acquired in-process research and
    development.
  Special charges.
  Realized and unrealized (gain) loss on investments,
    net.
  Interest income, net.
  Other expense (income), net.
  Income tax expense.
 70




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Results
    of Operations
    For the Year Ended


For the Year EndedDecember 31,


December 31,Percent








PercentResults of Operations:

2008


2007(1)


Change


2007(1)


2006


ChangeSalesProduct sales

$
402,233


$
278,226



44.6
%

$
278,226


$
202,438



37.4
%Research collaboration


19,895



5,957



NM



5,957







NMNet sales


422,128



284,183



48.5
%


284,183



202,438



40.4
%Operating expenses:Product cost of goods sold


136,847



99,879



37.0
%


99,879



71,321



40.0
%Research collaboration


6,051



1,065



NM



1,065







NMSales, general and administrative


231,957



195,267



18.8
%


195,267



141,779



37.7
%Research and development


48,784



48,413



0.8
%


48,413



26,725



81.2
%Amortization of intangible assets


31,072



20,306



53.0
%


20,306



17,223



17.9
%Goodwill and other intangibleasset impairment(2)


299,263







NM











NMLoss (gain) on sale or disposalof assets, net


243



(978
)


NM



(978
)


162



NMAcquired in-process research anddevelopment






70,700



NM



70,700



1,786



NMSpecial charges






19,054



NM



19,054







NMTotal operating expenses


754,217



453,706



66.2
%


453,706



258,996



75.2
%Loss from operations


(332,089
)


(169,523
)


NM



(169,523
)


(56,558
)


NMOther (income) expense:Realized and unrealized (gain) loss on investments, net


(487
)


116



NM



116



(1,063
)


NMInterest income, net


(223
)


(1,910
)


NM



(1,910
)


(1,695
)


NMOther expense (income), net


2,427



(2,934
)


NM



(2,934
)


(2,117
)


NMLoss before income taxes


(333,806
)


(164,795
)


NM



(164,795
)


(51,683
)


NMIncome tax expense


1,816



949



91.4
%


949



688



37.9
%Net loss

$
(335,622
)

$
(165,744
)


NM


$
(165,744
)

$
(52,371
)


NM     (1)
    
    We acquired FoxHollow Technologies, Inc. on October 4,
    2007. The acquisition was accounted for under the purchase
    method of accounting and the results of operations of FoxHollow
    have been included in our consolidated operating results as of
    the acquisition date. In connection with the acquisition, we
    recorded $14.9 million of integration costs associated with
    the acquisition and recognized $70.7 million for in-process
    research and development charges. For a more complete
    description of these items and their impact on our consolidated
    financial results, see Note 5 to our consolidated financial
    statements.(2)
    
    During the fourth fiscal quarter 2008, we recorded
    $288.8 million in non-cash, asset impairment charges in our
    peripheral vascular segment to reduce the carrying values of
    goodwill and other intangible assets to their estimated fair
    values. Additionally, during the second fiscal quarter 2008, as
    a result of the termination of our research collaboration with
    Merck, we recorded a non-cash asset impairment charge of
    $10.5 million to write-off the remaining carrying value of
    the related Merck intangible asset that was established at the
    time of our acquisition of FoxHollow. For a more complete
    description of these items and their impact on our consolidated
    financial results, see Note 10 to our consolidated
    financial statements. 71




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For the Year Ended





For the Year EndedDecember 31,


Percent


December 31,


PercentNet Sales by Segment

2008


2007


Change


2007


2006


ChangeNet product sales:Peripheral vascular:Atherectomy

$
88,800


$
20,884



325.2
%

$
20,884


$




100.0
%Stents


107,146



86,035



24.5
%


86,035



64,092



34.2
%Thrombectomy and embolic protection


27,779



25,998



6.9
%


25,998



21,606



20.3
%Procedural support and other


46,204



40,858



13.1
%


40,858



35,406



15.4
%Total peripheral vascular

$
269,929


$
173,775



55.3
%

$
173,775


$
121,104



43.5
%Neurovascular:Embolic products

$
74,642


$
56,003



33.3
%

$
56,003


$
38,998



43.6
%Neuro access and delivery products


57,662



48,448



19.0
%


48,448



42,336



14.4
%Total neurovascular

$
132,304


$
104,451



26.7
%

$
104,451


$
81,334



28.4
%Total net product sales


402,233



278,226







278,226



202,438



37.4
%Research collaboration:

$
19,895


$
5,957



234.0
%

$
5,957


$




100.0
%Total net sales

$
422,128


$
284,183



48.5
%

$
284,183


$
202,438



40.4
%   For the Year Ended





For the Year EndedDecember 31,


Percent


December 31,


PercentNet Sales by Geography

2008


2007


Change


2007


2006


ChangeUnited States

$
275,433


$
177,198



55.4
%

$
177,198


$
121,180



46.2
%InternationalBefore foreign exchange impact


141,704



106,985



32.5
%


101,020



81,258



24.3
%Foreign exchange impact


4,991











5,965







Total


146,695



106,985



37.1
%


106,985



81,258



31.7
%Total

$
422,128


$
284,183



48.5
%

$
284,183


$
202,438



40.4
%   Comparison
    of the Year Ended December 31, 2008 to the Year Ended
    December 31, 2007
  Net sales.
  Net sales of peripheral vascular products.
   72




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Net sales of neurovascular products.
  Research collaboration (revenue).
  Net sales by geography.
  Product cost of goods sold.
  Research collaboration (expense).
  Sales, general and administrative.
 73




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Research and development.
  Amortization of intangible
    assets.
  Goodwill and other intangible asset
    impairment.
  Acquired in-process research and
    development.
  Special charges.
  Realized and unrealized loss (gain) on investments,
    net.
  Interest income, net.
  Other expense (income), net.
  Income tax expense.
  Comparison
    of the Year Ended December 31, 2007 to the Year Ended
    December 31, 2006
  Net sales.
 74




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##### Table of Contents



Net sales of peripheral vascular products.
  Net sales of neurovascular products.
  Research collaboration (revenue).
  Net sales by geography.
  Product cost of goods sold. write-up
  Research collaboration (expense).
  Sales, general and administrative
    expenses.
 75




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Research and development expense.
  Amortization of intangible
    assets.
  Acquired in-process research and
    development.
      Special charges.
  (Gain) loss on sale of investments,
    net.
  Interest income, net.
 76




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##### Table of Contents



Other expense (income), net.
  Income tax expense.
  Seasonality
    and Quarterly Fluctuations
      Liquidity
    and Capital Resources
    As of December 31,Balance Sheet Data

2008


2007(Dollars in thousands)Cash and cash equivalents

$
59,652


$
81,060Short-term investments






9,744Total current assets


187,123



228,370Total assets


720,664



1,087,106Total current liabilities


67,448



119,159Total liabilities


80,123



128,625Total stockholders equity


640,541



958,481   Working
    Capital
  Cash, cash equivalents and short-term
    investments.
  Letters of credit and restricted cash.
  Financing history.
 77




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Credit facility.
       78




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Cash
    Flows
  Operating activities.
  Investing activities.
  Financing activities.
 79




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##### Table of Contents



Contractual
    Cash Obligations
    Payments Due by PeriodLess than





3-5


More thanTotal


1 Year


1-3 Years


Years


5 Years


Other(dollars in thousand)Notes payable

$
9,707


$
2,856


$
5,370


$
1,481


$



$
Operating leases(1)


22,823



6,685



7,797



3,316



5,025



FASB Interpretation 48 income tax obligations, including
    interest and penalties(2)


1,023



214















809Total

$
33,553


$
9,755


$
13,167


$
4,797


$
5,025


$
809     (1)
    
    The amounts reflected in the table above for operating leases
    represent future minimum lease payments under non-cancelable
    operating leases primarily for certain office space, warehouse
    space, computers and vehicles. Portions of these payments are
    denominated in foreign currencies and were translated in the
    tables above based on their respective U.S. dollar exchange
    rates at December 31, 2008. These future payments are
    subject to foreign currency exchange rate risk. In accordance
    with U.S. generally accepted accounting principles, or GAAP, our
    operating leases are not recognized on our consolidated balance
    sheet.(2)
    
    The FASB Interpretation 48 income tax obligations of $809,000
    included in the other column in the table above
    represent an amount of potential tax liabilities that we are
    uncertain as to if or when such amounts may be settled.  Off-Balance
    Sheet Arrangements
    Other
    Liquidity Information
       80




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Credit
    Risk
    Critical
    Accounting Policies and Estimates
     81




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##### Table of Contents



Revenue
    Recognition
      Stock-Based
    Compensation
           82




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Allowance
    for Doubtful Accounts
      Excess
    and Obsolete Inventory
    Valuation
    of Acquired In-Process Research and Development
     83




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##### Table of Contents



Goodwill
    and Other Intangible Assets
        Accounting
    for Income Taxes
   84




---



##### Table of Contents



Recently
    Issued Accounting Pronouncements
  Fair Value Measurements
  No. FAS 157-2, Effective Date of FASB Statement
    No. 157 (FSP 157-2)which FSP 157-2
  No. FAS 157-3, Determining the Fair Value of a Financial Asset When
    the Market for That Asset Is Not Active (FSP 157-3) FSP 157-3
  Business Combinations Noncontrolling Interests in
    Consolidated Financial Statements
   85




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##### Table of Contents



The Fair Value Option for
    Financial Assets and Financial Liabilities  Including
    an amendment of FASB Statement No. 115 contract-by-contract
 86




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##### Table of Contents



ITEM 7A.
    QUANTITATIVE
    AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK    Interest
    Rate Risk
      Foreign
    Currency Exchange Rate Risk
     87




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##### 



ITEM 8.
    FINANCIAL
    STATEMENTS AND SUPPLEMENTARY DATA   
 Description

PageManagements Report on Internal Control over
    Financial Reporting


F-1Reports of Independent Registered Public
    Accounting Firm


F-2  F-3Consolidated Balance Sheets as of
    December 31, 2008 and 2007


F-4Consolidated Statements of Operations for the
    years ended December 31, 2008, 2007 and 2006


F-5Consolidated Statements of Stockholders
    Equity for the years ended December 31, 2008, 2007 and
    2006


F-6Consolidated Statements of Cash Flows for the
    years ended December 31, 2008, 2007 and 2006


F-7  F-8Notes to the Consolidated Financial Statements
    for the years ended December 31, 2008, 2007 and 2006


F-9  F-41Schedule II  Valuation and
    Qualifying Accounts


F-42   88




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##### Table of Contents



MANAGEMENTS
    REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING  Rules 13a-15(f) 15d-15(f)
          /s/  Robert
    J. Palmisano

/s/  Shawn
    McCormickRobert J. Palmisano

Shawn McCormickPresident and Chief Executive Officer

Senior Vice President and Chief Financial Officer      F-1




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##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM  
               
     F-2




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REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
  
        Accounting for Uncertainty in Income Taxes
    an interpretation of FASB Statement No. 109
     
     F-3




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##### Table of Contents



ev3
    Inc.
  CONSOLIDATED
    BALANCE SHEETS
 (Dollars
    in thousands, except per share amounts)
  December 31,2008


2007ASSETSCurrent assetsCash and cash equivalents

$
59,652


$
81,060Short-term investments






9,744Accounts receivable, less allowance of $8,098 and $6,783
    respectively


72,814



66,170Inventories


47,687



64,044Prepaid expenses and other assets


6,005



6,371Other receivables


965



981Total current assets


187,123



228,370Restricted cash


1,531



2,204Property and equipment, net


30,681



37,985Goodwill


315,654



586,648Other intangible assets, net


185,292



231,000Other assets


383



899Total assets

$
720,664


$
1,087,106LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilitiesAccounts payable

$
15,657


$
21,511Accrued compensation and benefits


29,547



35,301Accrued liabilities


19,744



49,429Deferred revenue






9,347Current portion of long-term debt


2,500



3,571Total current liabilities


67,448



119,159Long-term debt


6,458



6,429Other long-term liabilities


6,217



3,037Total liabilities


80,123



128,625Stockholders equityPreferred stock, $0.01 par value, 100,000,000 shares
    authorized, none issued and outstanding as of December 31,
    2008 and 2007






Common stock, $0.01 par value, 300,000,000 shares
    authorized, 105,822,444 and 105,078,769 shares issued and
    outstanding as of December 31, 2008 and 2007, respectively


1,058



1,051Additional paid in capital


1,756,832



1,739,064Accumulated deficit


(1,116,661
)


(781,039
)Accumulated other comprehensive loss


(688
)


(595
)Total stockholders equity


640,541



958,481Total liabilities and stockholders equity

$
720,664


$
1,087,106    F-4




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##### Table of Contents



ev3
    Inc.
  CONSOLIDATED
    STATEMENTS OF OPERATIONS
 (Dollars
    in thousands, except per share amounts)
  For the Years Ended December 31,2008


2007


2006Sales:Product sales

$
402,233


$
278,226


$
202,438Research collaboration


19,895



5,957



Net sales


422,128



284,183



202,438Operating expenses:Product cost of goods sold


136,847



99,879



71,321Research collaboration


6,051



1,065



Sales, general and administrative


231,957



195,267



141,779Research and development


48,784



48,413



26,725Amortization of intangible assets


31,072



20,306



17,223Goodwill and other intangible asset impairment


299,263







Loss (gain) on sale or disposal of assets, net


243



(978
)


162Acquired in-process research and development






70,700



1,786Special charges






19,054



Total operating expenses


754,217



453,706



258,996Loss from operations


(332,089
)


(169,523
)


(56,558
)Other (income) expense:Realized and unrealized (gain) loss on investments, net


(487
)


116



(1,063
)Interest income, net


(223
)


(1,910
)


(1,695
)Other expense (income), net


2,427



(2,934
)


(2,117
)Loss before income taxes


(333,806
)


(164,795
)


(51,683
)Income tax expense


1,816



949



688Net loss

$
(335,622
)

$
(165,744
)

$
(52,371
)Net loss per common share (basic and diluted)

$
(3.22
)

$
(2.37
)

$
(0.93
)Weighted average shares outstanding (basic and diluted)


104,378,828



69,909,708



56,585,025    F-5




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##### Table of Contents



ev3
    Inc.
  CONSOLIDATED
    STATEMENTS OF STOCKHOLDERS EQUITY
 (Dollars
    in thousands, except per share amounts)
  AccumulatedOther


TotalCommon Stock





Accumulated


Comprehensive


StockholdersShares


Amount


APIC


Deficit


Income (Loss)


EquityBalance as of January 1, 2006


49,350,647


$
493


$
807,032


$
(562,207
)

$
137


$
245,455Comprehensive loss:Net loss














(52,371
)






(52,371
)Cumulative translation adjustment


















(122
)


(122
)Comprehensive loss






















(52,493
)Compensation expense on options and restricted stock










6,760











6,760Exercise of options


1,160,594



12



9,924











9,936MTI acquisition


6,997,354



70



95,368











95,438Unrestricted stock grants


28,341







393











393Restricted stock grants


74,024



1



(1
)










Shares repurchased


(16,218
)






(255
)










(255
)Balance December 31, 2006


57,594,742


$
576


$
919,221


$
(614,578
)

$
15


$
305,234Comprehensive loss:Net loss














(165,744
)






(165,744
)Changes in unrealized (losses) gains on investments


















(174
)


(174
)Cumulative translation adjustment


















(436
)


(436
)Comprehensive loss






















(166,354
)Cumulative effect of adoption of FIN 48














(717
)






(717
)Common stock issued in conjunction with secondary offering


2,500,000



25



44,517











44,542Compensation expense on equity awards and stock purchase plan










11,127











11,127Exercise of options


664,178



7



6,719











6,726Restricted stock grants, net of cancellations


1,176,321



12



(12
)










Common stock issued under employee stock purchase plan


60,534







868











868Shares repurchased


(33,258
)






(507
)










(507
)Common stock issued in acquisition of FoxHollow


43,118,667



431



757,131











757,562FoxHollow stock transactions, other


(2,415
)


















Balance December 31, 2007


105,078,769


$
1,051


$
1,739,064


$
(781,039
)

$
(595
)

$
958,481Comprehensive loss:Net loss














(335,622
)






(335,622
)Changes in unrealized (losses) gains on investments


















45



45Cumulative translation adjustment


















(138
)


(138
)Comprehensive loss






















(335,715
)Compensation expense on equity awards and stock purchase plan










15,159











15,159Exercise of options


227,882



2



1,273











1,275Restricted stock grants, net of cancellations


390,197



4



(4
)










Common stock issued under employee stock purchase plan


208,605



2



1,901











1,903Shares repurchased


(83,009
)


(1
)


(561
)










(562
)Balance December 31, 2008


105,822,444


$
1,058


$
1,756,832


$
(1,116,661
)

$
(688
)

$
640,541    F-6




---



##### Table of Contents



ev3
    Inc.
  CONSOLIDATED
    STATEMENTS OF CASH FLOWS
 (Dollars
    in thousands, except per share amounts)
  For the Years Ended December 31,2008


2007


2006Operating activitiesNet loss

$
(335,622
)

$
(165,744
)

$
(52,371
)Adjustments to reconcile net loss to net cash used in operating
    activities Depreciation and amortization


42,595



28,726



22,878Provision for bad debts and sales returns


2,538



2,024



728Provision for inventory obsolescence


8,870



8,308



3,787Acquired in-process research and development






70,700



1,786(Gain) loss on sale or disposal of investments and assets, net


(244
)


(978
)


(901
)Stock compensation expense


15,159



11,127



7,153Goodwill and other intangible asset impairment


299,263







Change in operating assets and liabilities, net of acquired:Accounts receivable


(8,281
)


1,340



(17,362
)Inventories


6,169



(14,524
)


(12,287
)Prepaid expenses and other assets


294



2,836



(619
)Accounts payable


(6,804
)


3,060



1,186Accrued expenses and other liabilities


(28,774
)


(5,408
)


(890
)Deferred revenue


(9,043
)


9,347



Net cash used in operating activities


(13,880
)


(49,186
)


(46,912
)Investing activitiesPurchase of short-term investments










(6,750
)Proceeds from sale of short-term investments


9,744



6,900



4,050Purchase of property and equipment


(10,875
)


(13,804
)


(11,983
)Purchase of patents and licenses


(2,728
)


(3,270
)


(3,516
)Purchase of distribution rights






(6,500
)


Proceeds from sale of assets


1,244



2,035



69Proceeds from sale of investments










1,063Acquisitions, net of cash acquired


(7,500
)






(70
)Payments for the acquisition of FoxHollow, net of cash acquired


(127
)


65,556



Increase in restricted cash


646



1,007



1,116Net cash (used in) provided by investing activities


(9,596
)


51,924



(16,021
)    F-7




---



##### Table of Contents



For the Years Ended December 31,2008


2007


2006Financing activitiesProceeds from issuance of common stock, net

$



$
44,542


$
Proceeds from long-term debt


10,000



5,000



7,500Payments on long-term debt


(11,042
)


(2,499
)


Proceeds from exercise of stock options


1,275



6,726



9,936Proceeds from employee stock purchase plan


1,903



868



Other


(541
)


(646
)


(496
)Net cash provided by financing activities


1,595



53,991



16,940Effect of exchange rate changes on cash


473



278



454Net (decrease) increase in cash and cash equivalents


(21,408
)


57,007



(45,539
)Cash and cash equivalents, beginning of period


81,060



24,053



69,592Cash and cash equivalents, end of period

$
59,652


$
81,060


$
24,053Supplemental cash flow information:Cash paid for interest

$
839


$
1,400


$
626Cash paid for income taxes

$
943


$
610


$
570Supplemental non-cash disclosure:Goodwill and other intangible asset impairment (see Note 10)

$
299,263


$



$
Net assets acquired in conjunction with the acquisition of
    FoxHollow (see Note 5)

$



$
856,915


$
Earn-out payment accrued

$



$
7,500


$
Net assets acquired in conjunction with MTI step acquisition
    (see Note 5)

$



$



$
95,438Financed insurance premiums

$



$



$
3,500    F-8




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  1.
    Description
    of Business    2.
    Summary
    of Significant Accounting Policies  Principles
    of Consolidation
    Use of
    Estimates
    Cash
    Equivalents
    Short-term
    Investments
    Accounts
    Receivable
   F-9




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Inventories
  first-in,
    Restricted
    Cash
    Property
    and Equipment
    Goodwill
   F-10




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Impairment
    of Long-Lived Assets and Amortizable Intangible
    Assets
    Investments
    Revenue
    Recognition
       F-11




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  No. 00-21, Accounting for Revenue Arrangements with Multiple
    Deliverables (EITF 00-21)
  mark-up.
      Shipping
    and Handling Costs
    Advertising
    Costs
    Research
    and Development
    Acquired
    In-process Research and Development
    (IPR&D)
   F-12




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Special
    Charges
    Foreign
    Currency Translation
    Income
    Taxes
  Accounting for Income
    Taxes
  Accounting for Uncertainty in Income Taxes
  Loss
    per Share
   F-13




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Comprehensive
    Loss
    Concentrations
    of Credit Risk
        Accounting
    for Stock-Based Compensation
  Share-Based
    Payment
    Year Ended December 31,2008


2007


2006Risk free interest rate


2.6%



4.4%



4.7%Expected dividend yield


0.0%



0.0%



0.0%Expected volatility


44.8%



43.6%



49.1%Expected option term


3.85 years



3.85 years



3.75 years   96-18, Accounting for Equity Instruments that are Issued to
    Other than Employees for Acquiring, or in Conjunction with
    Selling, Goods or
 F-14




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  Services (EITF 96-18)
    Year Ended December 31,2008


2007


2006Product cost of goods sold

$
834


$
926


$
630Sales, general and administrative


12,438



8,832



5,868Research and development


1,887



1,369



655Total stock-based compensation charges

$
15,159


$
11,127


$
7,153     Fiscal
    Year
    New
    Accounting Pronouncements
  Fair Value
    Measurements
  No. FAS 157-2, Effective Date of FASB Statement
    No. 157 (FSP 157-2) FSP 157-2
  No. FAS 157-3, Determining the Fair Value of a Financial Asset When
    the Market for That Asset Is Not Active (FSP 157-3)which FSP 157-3
  Business Combinations Noncontrolling Interests in
    Consolidated Financial Statements
 F-15




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    The Fair Value Option for
    Financial Assets and Financial Liabilities  Including
    an amendment of FASB Statement No. 115 contract-by-contract
  3.
    Liquidity
    and Capital Resources         F-16




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      4.
    Fair
    Value Measurements  Fair Value Measurement
  
    Level 1.  Observable inputs such as quoted
    prices in active markets; F-17




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
   
    Level 2.  Inputs, other than the quoted
    prices in active markets, that are observable either directly or
    indirectly; and
    Level 3.  Unobservable inputs in which
    there is little or no market data, which require the reporting
    entity to develop its own assumptions.  Assets
    and Liabilities Measured at Fair Value on a Recurring
    Basis
    5.
    Acquisitions  FoxHollow
    Acquisition
     F-18




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  No. 99-12, Determination of the Measurement Date for the Market
    Price of Acquirer Securities Issued in a Purchase Business
    Combination (EITF 99-12).
        Expected term (in years)


2.7Expected volatility


45.00
%Risk-free interest rate


4.60
%Stock price on date of grant

$
16.83Weighted-average exercise price

$
14.99  F-19




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      PurchasePriceConsiderationFoxHollow common shares converted

$
725,687Cash consideration


81,811FoxHollow options converted


31,875Total cash and equity

$
839,373Merck consideration


8,824Deal costs


8,846Total purchase price consideration

$
857,043       October 4,2007Intangible assets

$
199,500Acquired in-process research and development


70,700Tangible assets acquired, net of liabilities assumed


145,854Goodwill


440,989Estimated fair value of identifiable tangible and intangible
    assets and goodwill, net of cash acquired and liabilities assumed

$
857,043     Weighted AverageAmortization PeriodIntangible Asset Description

Fair Value Assigned


(in Years)Developed and core technology

$
138,800



12Customer relationships


40,000



12Merck exclusivity


13,600



3.25Trademarks and tradenames


7,100



10Total intangible assets acquired (excluding goodwill)

$
199,500



11    F-20




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
          step-up step-up
    Pro
    Forma Results of Operations
   F-21




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      Year EndedDecember 31, 2007Reported


Pro FormaNet revenues

$
284,183


$
439,893Net loss

$
(165,744
)

$
(202,337
)Net loss per share:Basic and diluted

$
(2.37
)

$
(1.98
)   MTI
    Step Acquisition
    Consolidated Financial
    Statements
    January 6,2006Fair value of shares/options issued

$
95,438Interest acquired in historical book value of MTI


(12,850
)Excess purchase price over historical book values

$
82,588  F-22




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    January 6,2006Inventory

$
668Developed technology


15,548Customer relationships


9,964Trademarks and tradenames


2,029Acquired in-process research and development


1,786Goodwill


54,605Accrued liabilities


(2,012
)Total

$
82,588       6.
    Restructuring   F-23




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  EITF 95-3, Recognition of Liabilities in Connection with a
    Purchase Business Combination. (EITF 95-3).
    Purchase Price Adjustments (EITF 95-3)Balance at


Adjustments to





Balance atDecember 31,


Purchase Price





December 31,2007


Allocation


Amounts Paid


2008Workforce reductions

$
7,605


$
848


$
(7,783
)

$
670Termination of contractual commitments


2,476



6,294



(1,275
)


7,495Total

$
10,081


$
7,142


$
(9,058
)

$
8,165   Employers Accounting for
    Postemployment Benefits
    Expensed (SFAS 112)Balance atDecember 31,


Amounts Charged to





Balance at2007


Expense


Amounts Paid


December 31, 2008Workforce reductions

$
999


$
(120
)

$
(879
)

$
Total

$
999


$
(120
)

$
(879
)

$
   7.
    Inventories    December 31,2008


2007Raw materials

$
10,472


$
18,003Work-in-progress


4,144



3,946Finished goods


43,408



53,06358,024



75,012Inventory reserve


(10,337
)


(10,968
)Inventory, net

$
47,687


$
64,044    F-24




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  8.
    Property
    and Equipment    December 31,2008


2007Machinery and equipment

$
29,550


$
27,405Office furniture and equipment


18,466



16,897Leasehold improvements


14,131



14,656Construction in progress


5,670



6,95767,817



65,915Less:Accumulated depreciation and amortization


(37,136
)


(27,930
)Property and equipment, net

$
30,681


$
37,985     9.
    Goodwill
    and Other Intangible Assets    Peripheral


Neuro-Vascular


vascular


TotalBalance as of January 1, 2007

$
71,307


$
77,754


$
149,061Contingent consideration related to acquisition milestone






7,500



7,500Goodwill related to acquisition of FoxHollow


430,087







430,087Balance as of December 31, 2007


501,394



85,254



586,648Adjustments to finalize purchase accounting


10,902







10,902Goodwill impairment (see Note 10)


(281,896
)






(281,896
)Balance as of December 31, 2008

$
230,400


$
85,254


$
315,654  F-25




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    December 31,Weighted


2008


2007average


Gross





Net


Gross





Netuseful life


Carrying


Accumulated


Carrying


Carrying


Accumulated


Carrying(in years)


Amount


Amortization


Amount


Amount


Amortization


AmountPatents and licenses


5.0


$
15,413


$
(6,264
)

$
9,149


$
13,802


$
(4,890
)

$
8,912Developed technology


10.0



196,016



(66,312
)


129,704



202,416



(50,213
)


152,203Trademarks and tradenames


9.0



12,222



(4,457
)


7,765



12,222



(3,454
)


8,768Customer relationships


10.0



56,094



(17,967
)


38,127



56,094



(13,094
)


43,000Distribution rights


2.5



7,966



(7,419
)


547



9,274



(3,710
)


5,564Merck exclusivity


3.3















13,600



(1,047
)


12,553Other intangible assets





$
287,711


$
(102,419
)

$
185,292


$
307,408


$
(76,408
)

$
231,000         2009

$
21,4572010


19,4782011


17,9242012


17,8112013


17,513
   10.
    Goodwill
    and Other Intangible Asset Impairment  Goodwill and
    Other Intangible Assets
   F-26




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  build-up
           F-27




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      11.
    Investments    12.
    Accrued
    Liabilities    December 312008


2007Accrued professional services

$
1,685


$
3,016Accrued clinical studies


2,714



1,814Accrued litigation


286



16,054Dendron earn-out payment






7,500Tax liabilities


1,650



1,491Accrued royalties


2,527



2,062Deferred rent


539



2,368Accrued other


10,343



15,124Total accrued liabilities

$
19,744


$
49,429   13.
    Long-Term
    Debt    December 31,2008


2007Equipment term loan

$
8,958


$
10,000Less: current portion


(2,500
)


(3,571
)Total long-term debt

$
6,458


$
6,429    F-28




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
           F-29




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    2009

$
2,5002010


2,5002011


2,5002012


1,458Total

$
8,958
   14.  Loss
    (Gain) on Sale or Disposal of Assets, Net
  Miscellaneous Accounting 
    Gain Recognition on the Sale of a Business or Operating Assets
    to a Highly Leveraged Entity.
  15.  Interest
    Income, Net
    Year Ended December 31,2008


2007


2006Interest income

$
(1,369
)

$
(3,284
)

$
(2,469
)Interest expense


1,146



1,374



774Interest income, net

$
(223
)

$
(1,910
)

$
(1,695
)   16.
    Equity-Based
    Compensation Plans   F-30




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
              Weighted-Average


AggregateAwarded Shares


Exercise Price Per


IntrinsicOutstanding


Share


ValueBalance at January 1, 2008


12,051,561


$
14.68


$
10,981Granted


2,106,055


$
9.06Exercised


(227,882
)

$
5.60Forfeited


(1,758,231
)

$
15.61Expired


(2,423,971
)

$
16.83Balance at December 31, 2008


9,747,532


$
12.98


$
721Options exercisable at December 31, 2008


6,283,780


$
13.48


$
624  F-31




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
        :
  Options Outstanding


Options ExercisableWeighted-


Weighted-





Weighted-Average


Average





AverageNumber


per Share


Remaining


Number


Exercise PriceExercise Price Per Share

Outstanding


Exercise Price


Contractual Life


Exercisable


Per Share$ 0.20 - $ 6.10


335,716


$
3.95



4.8 years



234,883


$
3.44$ 6.47 - $ 8.82


2,593,728


$
8.53



5.7 years



1,493,433


$
8.46$ 8.84 - $13.89


2,213,192


$
11.82



6.4 years



1,207,989


$
12.85$13.90 - $16.64


2,552,637


$
15.31



5.1 years



1,817,179


$
15.03$16.66 - $96.06


2,052,259


$
18.43



4.3 years



1,530,296


$
18.579,747,532


$
12.98



5.4 years



6,283,780


$
13.48     Awarded


Weighted-AverageShares


Grant DateOutstanding


Fair ValueNonvested balance at January 1, 2008


1,292,965


$
16.73Granted


872,339


$
8.72Vested


(495,782
)

$
15.09Forfeited


(427,692
)

$
15.51Nonvested balance at December 31, 2008


1,241,830


$
12.04     17.
    Defined
    Contribution Plans   F-32




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    18.
    Income
    Taxes    For the Years Ended December 31,2008


2007


2006U.S. Federal statutory tax rate


(35.0
)%


(35.0
)%


(35.0
)%Goodwill and other intangible asset impairment


29.6
%






Change in valuation allowance


5.7
%


20.2
%


39.6
%Stock options


0.9
%






(0.5
)%State income taxes


(0.4
)%


(0.1
)%


(3.0
)%Research and development


(0.3
)%






Meals and entertainment


0.2
%


0.3
%


0.6
%Foreign income taxes


0.1
%


0.6
%


0.9
%Acquired in-process research and development



%


15.1
%


1.2
%Other, net


(0.3
)%


(0.5
)%


(2.5
)%Effective tax rate


0.5
%


0.6
%


1.3
%     For the Years Ended December 31,2008


2007


2006Current:U.S.

$
222


$



$
Foreign


1,571



949



688Total current


1,793



949



688Deferred:










Total tax provision

$
1,793


$
949


$
688  F-33




---



##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    December 31,2008


2007Deferred Tax Assets:Net operating loss carryforwards

$
212,443


$
214,569Capitalized research & development costs


35,878



24,477Other reserves and accruals


11,576



12,145Stock options


6,453



4,010Tax credit carryforwards


5,439



4,180Inventories


4,677



8,840Unrealized losses on investments


3,362



3,177Property and equipment


2,764



3,046Other


609



1,174Deferred revenue






3,593Valuation allowance


(220,077
)


(199,040
)Total deferred tax assets

$
63,124


$
80,171Deferred Tax Liabilities:Intangible assets


(63,124
)


(80,171
)Net deferred tax asset (liability)

$



$
     Business Combinations
  Accounting for Uncertainty in Income Taxes
 F-34




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##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    Gross unrecognized tax benefits at January 1, 2007

$
4,656Current year acquisition


3,223Increase for tax positions in prior years


1,648Decrease for tax positions in prior years


(804
)Settlements


(163
)Increase for tax positions in current years


870Gross unrecognized tax benefits at December 31, 2007

$
9,430Increase for tax positions in prior years


1,260Decrease for tax positions in prior years


(334
)Settlements


(80
)Increase for tax positions in current years


415Gross unrecognized tax benefits at December 31, 2008

$
10,691           CarryforwardU. S.


Foreign


Total


Expiration Period$
27,945


$
22,489


$
50,434



2009 - 2018121,630



22



121,652



2019 - 2022375,772







375,772



2023 - 2028



13,867



13,867



No expiration date$
525,347


$
36,378


$
561,725      F-35




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##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      19.
    Commitments
    and Contingencies  Operating
    Leases
      Years ending December 31:2009

$
6,6852010


4,7072011


3,0902012


1,8032013


1,513Thereafter


5,025$
22,823         Letters
    of Credit
  Letters
    of Credit and Restricted Cash
   F-36




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##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
  License
    Agreements
    Contingencies
       F-37




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##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
      20.
    Segment
    and Geographic Information       F-38




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##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    For the Years Ended December 31,2008


2007


2006Net salesNet product sales:Peripheral vascularAtherectomy

$
88,800


$
20,884


$
Stents


107,146



86,035



64,092Thrombectomy and embolic protection


27,779



25,998



21,606Procedural support and other


46,204



40,858



35,406Total peripheral vascular


269,929



173,775



121,104NeurovascularEmbolic products


74,642



56,003



38,998Neuro access and delivery products


57,662



48,448



42,336Total neurovascular


132,304



104,451



81,334Total net product sales

$
402,233


$
278,226


$
202,438Research collaboration:


19,895



5,957



Total net sales

$
422,128


$
284,183


$
202,438Gross profitPeripheral vascular

$
167,505


$
100,693


$
68,933Neurovascular


97,881



77,654



62,184Research collaboration


13,844



4,892



Total gross profit(1)

$
279,230


$
183,239


$
131,117Operating expense


611,319



352,762



187,675Loss from operations

$
(332,089
)

$
(169,523
)

$
(56,558
)Total assetsPeripheral vascular

$
545,588


$
916,077Neurovascular


175,076



171,029Total

$
720,664


$
1,087,106     (1)
    
    Gross profit for internal measurement purposes is defined as net
    sales less cost of goods sold excluding amortization of
    intangible assets.   F-39




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##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
     December 31,Geographic Data

2008


2007


2006Net SalesUnited States

$
275,433


$
177,198


$
121,180International


146,695



106,985



81,258Total net sales

$
422,128


$
284,183


$
202,438Long-lived AssetsUnited States

$
29,603


$
37,015International


1,078



970Total long-lived assets

$
30,681


$
37,985   21.
    Related
    Party Transactions       F-40




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##### Table of Contents



ev3
    Inc.
  NOTES TO
    CONSOLIDATED FINANCIAL
    STATEMENTS  (Continued)
    22.
    Net Loss
    Per Common Share      23.
    Quarterly
    Financial Data (Unaudited)  Cost


Net Loss





Net Lossof


from





PerNet Sales


Sales


Operations


Net Loss


Share2008First Fiscal Quarter

$
101,257


$
33,618


$
(12,158
)

$
(9,770
)

$
(0.09
)Second Fiscal Quarter


107,717



36,189



(26,862
)(1)


(27,422
)(1)


(0.26
)Third Fiscal Quarter


107,029



38,282



(4,608
)


(7,310
)


(0.07
)Fourth Fiscal Quarter


106,125



34,809



(288,461
)(2)


(291,120
)(2)


(2.78
)2007First Fiscal Quarter

$
61,499


$
20,457


$
(9,644
)

$
(9,494
)

$
(0.17
)Second Fiscal Quarter


65,396



22,362



(12,031
)


(11,871
)


(0.20
)Third Fiscal Quarter


65,060



23,097



(38,233
)(3)


(36,512
)(3)


(0.60
)Fourth Fiscal Quarter


92,228
(4)


35,028



(109,615
)(5)


(107,867
)(5)


(1.06
)     (1)
    
    During the second fiscal quarter 2008, as a result of the
    termination of our research and collaboration with Merck, we
    recorded an asset impairment charge of $10.5 million to
    write-off the remaining carrying value of the related Merck
    intangible asset that was established at the time of our
    acquisition of FoxHollow. For additional discussion, see
    Note 10 above.(2)
    
    During the fourth fiscal quarter 2008, we recorded
    $288.8 million non-cash, asset impairment charges in our
    peripheral vascular segment to reduce the carrying values of
    goodwill and other intangible assets to their estimated fair
    values. For additional discussion, see Note 10 above.(3)
    
    In third fiscal quarter 2007, we incurred special charges of
    $19.1 million as a result of us entering into agreements in
    principle to settle certain patent infringement and other
    litigation with The Regents of the University of California and
    Boston Scientific Corporation.(4)
    
    In October 2007, we completed our acquisition of FoxHollow,
    which broadened our peripheral vascular product offering to
    include atherectomy and additional thrombectomy products,
    including the SilverHawk Plaque Excision System. Our fourth
    quarter 2008 net sales included $20.9 million of net
    sales from FoxHollow products. As a result of our FoxHollow
    acquisition, we also recognized research collaboration revenue
    from our former collaboration and license agreement with Merck.
    Research collaboration revenue for fourth fiscal quarter 2007
    was $6.0 million.(5)
    
    In the fourth fiscal quarter 2007, we recorded a charge of
    $70.7 million for acquired in-process research and
    development as a result of the acquisition of FoxHollow in
    October 2007. For additional discussion, see Note 5 above.
    We also made approximately $3.3 million of adjustments in
    our excess and obsolete inventory reserves for the planned
    discontinuance of the Primus balloon expandable stent and the
    Sailor .035 balloon due to our strategic marketing focus on new
    product introductions. F-41




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##### Table of Contents



ev3
    Inc.
 Schedule II
    Valuation and Qualifying Accounts Balance at


Charged toBeginning of


Revenue, Costs


Other





Balance atDescription

Period


or Expenses


Additions


Deductions


End of PeriodReserves deducted from assets to which it applies:Year ended December 31, 2008Reserve for deferred income tax asset

$
199,040


$
19,418


$
1,619



$




$
220,077Accounts receivable allowances


6,783



2,538








(1,223
)



8,098Reserve for inventory obsolescence


10,968



9,235








(9,866
)



10,337Year ended December 31, 2007Reserve for deferred income tax asset

$
191,960


$
34,273


$




$
(27,193
)
(b)

$
199,040Accounts receivable allowances


3,924



2,024



1,661
(a)



(826
)



6,783Reserve for inventory obsolescence


4,725



9,018



1,513
(a)



(4,288
)



10,968Year ended December 31, 2006Reserve for deferred income tax asset

$
176,142


$
15,818


$




$




$
191,960Accounts receivable allowances


3,607



746








(429
)



3,924Reserve for inventory obsolescence


3,975



3,725








(2,975
)



4,725     (a)
    
    Other additions primarily related to acquisitions.(b)
    
    Other deductions primarily related to acquisitions. F-42




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##### Table of Contents



ITEM 9.
    CHANGES
    IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
    FINANCIAL DISCLOSURE    ITEM 9A.
    CONTROLS
    AND PROCEDURES  Evaluation
    of Disclosure Controls and Procedures
  Rules 13a-15(e) 15d-15(e)
  Form 10-K.
  Managements
    Report on Internal Control Over Financial Reporting
      Change in
    Internal Control Over Financial Reporting
   ITEM 9B.  OTHER
    INFORMATION   89




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##### Table of Contents



PART III  ITEM 10.
    DIRECTORS,
    EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE  Directors
  Form 10-K
  Executive
    Officers
  Form 10-K
  Section 16(a)
    Beneficial Ownership Reporting Compliance
  Form 10-K
  Code of
    Conduct and Ethics
  Form 10-K
  Changes
    to Nomination Procedures
  Rule 14a-8
  Audit
    Committee Matters
  Form 10-K
 90




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##### Table of Contents



ITEM 11.
    EXECUTIVE
    COMPENSATION  Form 10-K
  ITEM 12.
    SECURITY
    OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
    RELATED STOCKHOLDER MATTERS  Securities
    Authorized for Issuance Under Equity Compensation
    Plans
    (a)


(b)


(c)Number ofSecuritiesRemaining AvailableNumber of





for Future IssuanceSecurities to be


Weighted-Average


Under EquityIssued Upon


Exercise Price of


Compensation PlansExercise of


Outstanding


(excludingOutstanding


Options,


securitiesOptions, Warrants


Warrants and


reflected inPlan Category

and Rights


Rights


column (a))Equity compensation plans approved by security holders


8,165,031
(1)(2)


$
10.88
(3)



4,649,363
(4)Equity compensation plans not approved by security holders


754,000
(5)(6)(7)



8.64




0Total


8,919,031



$
10.69




4,649,363     (1)
    
    Amount includes shares of our common stock issuable upon the
    exercise of stock options outstanding as of December 31,
    2008 under the ev3 Inc. Second Amended and Restated 2005
    Incentive Stock Plan and the ev3 LLC Amended and Restated 2003
    Incentive Plan and shares of our common stock issuable upon the
    vesting of restricted stock units outstanding as of
    December 31, 2008 under the ev3 Inc. Second Amended and
    Restated 2005 Incentive Stock Plan.(2)
    
    Excludes employee stock purchase rights accruing under the ev3
    Inc. Employee Stock Purchase Plan. Under such plan, each
    eligible employee may purchase up to 2,500 shares of our
    common stock at semi-annual intervals on June 30th and
    December 31st each year at a purchase price per share equal
    to 85% of the lower of (i) the closing sales price per
    share of our common stock on the first day of the offering
    period or (ii) the closing sales price per share of our
    common stock on the last day of the offering period.(3)
    
    Included in the weighted-average exercise price calculation are
    1,237,827 restricted stock units with an exercise price of
    $0.00. The weighted-average exercise price of all outstanding
    stock options as of December 31, 2008 and reflected in
    column (a) was $12.82.(4)
    
    Amount includes 4,168,502 shares remaining available at
    December 31, 2008 for future issuance under the ev3 Inc.
    Second Amended and Restated 2005 Incentive Stock Plan and
    480,861 shares remaining available at December 31,
    2008 for future issuance under the ev3 Inc. Employee Stock
    Purchase Plan. No shares remain available for grant under the
    ev3 LLC Amended and Restated 2003 Incentive Plan since such plan
    was terminated with respect to future grants in June 2005.(5)
    
    Excludes options assumed by us in connection with our
    acquisitions of Micro Therapeutics, Inc. and FoxHollow
    Technologies, Inc. As of December 31, 2008, a total of
    2,820,328 shares of our common stock were issuable upon
    exercise of the assumed options. The weighted average exercise
    price of the outstanding assumed options as of such date was
    $13.36 per share and they have an average weighted life
    remaining of 3.01 years. 820,529 of the 832,395 options
    outstanding in connection with our acquisition of Micro
    Therapeutics, Inc. were exercisable as of December 31,
    2008. 1,822,433 of the 1,991,936 options assumed and outstanding
    in connection with our acquisition of FoxHollow Technologies,
    Inc. were exercisable as of 91




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##### Table of Contents



December 31, 2008. No additional options, restricted stock
    units or other equity incentive awards may be granted under the
    assumed Micro Therapeutics, Inc. and FoxHollow Technologies,
    Inc. plans.(6)
    
    Excludes shares issuable upon the vesting of restricted stock
    units assumed by us in connection with our acquisition of
    FoxHollow Technologies, Inc. As of December 31, 2008, a
    total of 4,003 shares of our common stock were issuable
    upon the vesting of the assumed restricted stock units.(7)
    
    Consists of a non-plan option to purchase 754,000 shares of our
    common stock granted outside of the terms of our existing
    stockholder-approved equity incentive plans to
    Robert J. Palmisano, our President and
    Chief Executive Officer, as an inducement grant in April
    2008 pursuant to an exemption from NASDAQs shareholder
    approval requirements under NASDAQ Market place Rule Section
    4350(i)(1)(A)(iv).  Stock
    Ownership
  Form 10-K
  ITEM 13.
    CERTAIN
    RELATIONSHIPS, RELATED TRANSACTIONS, AND DIRECTOR
    INDEPENDENCE  Form 10-K
  ITEM 14.
    PRINCIPAL
    ACCOUNTING FEES AND SERVICES  Form 10-K
 92




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##### Table of Contents



PART IV  ITEM 15.
    EXHIBITS,
    FINANCIAL STATEMENT SCHEDULES        Form 10-K
  Form 8-K No. 000-51348)).
  Form 10-Q No. 000-51348)).
  Form 10-Q No. 000-51348)).
  Form 10-Q No. 000-51348)).
  Form 10-Q No. 000-51348)).
  Form 10-KSB No. 000-06523)).
  Form S-1 No. 333-118191)).
  Form 10-K No. 000-51348)).
  Form 10-Q No. 000-51348)).
  Form 8-K No. 000-51348)).
     93




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##### Table of Contents



Form 8-K 000-51348)).
  Form 8-K No. 000-51348)).
  Form 8-K No. 000-51348)).
  Form 8-K/A No. 000-51348)).
  Form 8-K/A 000-51348)).
  Form 8-K/A No. 000-51348)).
  Form 8-K/A No. 000-51348)).
  Form 8-K No. 000-51348)).
  Form 8-K 000-51348)).
  Form 8-K No. 000-51348)).
  Form 8-K 000-51348)).
  Form 8-K No. 000-51348)).
  Form 8-K No. 000-51348)).
  Form 8-K 000-51348)).
   94




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##### Table of Contents



SIGNATURES
    ev3 INC.
   By
    /s/  Robert
    J. Palmisano   President and Chief Executive Officer (principal executive
    officer)
  By
    /s/  Shawn
    McCormick   Senior Vice President and Chief Financial Officer
 (principal financial and accounting officer)
     Name and Signature

Title

Date/s/  Robert
    J. PalmisanoRobert
    J. Palmisano

President and
    Chief Executive Officer

February 27, 2009/s/  Daniel
    J. LevangieDaniel
    J. Levangie

Chairman of the Board

February 27, 2009/s/  John
    K. BakewellJohn
    K. Bakewell

Director

February 27, 2009/s/  Jeffrey
    B. ChildJeffrey
    B. Child

Director

February 27, 2009/s/  Richard
    B. EmmittRichard
    B. Emmitt

Director

February 27, 2009/s/  Douglas
    W. KohrsDouglas
    W. Kohrs

Director

February 27, 2009/s/  John
    L. MiclotJohn
    L. Miclot

Director

February 27, 2009/s/  Thomas
    E. TimbieThomas
    E. Timbie

Director

February 27, 2009/s/  Elizabeth
    H. WeathermanElizabeth
    H. Weatherman

Director

February 27, 2009  95




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##### Table of Contents



ev3
    INC.
  EXHIBIT INDEX
    TO ANNUAL REPORT ON
    FORM 10-K
    FOR THE YEAR ENDED DECEMBER 31, 2008
  ExhibitNo.

Exhibit

Method of Filing2
.1

Agreement and Plan of Merger, dated as of April 4, 2005, by
    and between ev3 LLC and ev3 Inc.

Incorporated by reference to Exhibit 2.1 to ev3s
    Registration Statement on Form S-1 filed with the Securities and
    Exchange Commission on April 5, 2005 (File No. 333-123851)2
.2

Contribution and Exchange Agreement, dated as of April 4,
    2005, by and among the institutional stockholders listed on
    Schedule I thereto, ev3 LLC, ev3 Inc. and Micro
    Therapeutics, Inc.

Incorporated by reference to Exhibit 2.2 to ev3s
    Registration Statement on Form S-1 filed with the Securities and
    Exchange Commission on April 5, 2005 (File No. 333-123851)2
.3

Note Contribution and Exchange Agreement, dated as of
    April 4, 2005, by and among the noteholders listed on
    Schedule I thereto and ev3 Inc.

Incorporated by reference to Exhibit 2.3 to ev3s
    Registration Statement on Form S-1 filed with the Securities and
    Exchange Commission on April 5, 2005 (File No. 333-123851)2
.4

Agreement and Plan of Merger, dated as of July 15, 2002, by
    and among Microvena Corporation, Appriva Acquisition Corp. and
    Appriva Medical, Inc.

Incorporated by reference to Exhibit 2.4 to ev3s
    Registration Statement on Form S-1 filed with the Securities and
    Exchange Commission on April 5, 2005 (File No. 333-123851)2
.5

Asset Purchase Agreement, dated as of September 29, 2004,
    among Edwards Lifesciences AG and ev3 Santa Rosa, Inc., ev3
    Technologies, Inc. and ev3 Endovascular, Inc. (formerly known as
    ev3 Inc.)(1)

Incorporated by reference to Exhibit 2.5 to ev3s
    Registration Statement on Form S-1 filed with the Securities and
    Exchange Commission on April 5, 2005 (File No. 333-123851)2
.6

Stock Purchase Agreement, dated September 3, 2002, by and
    between Micro Therapeutics, Inc. and the holders of the
    outstanding equity securities of Dendron

Incorporated by reference to Exhibit 2.2 to Micro Therapeutics,
    Inc.s Current Report on Form 8-K filed with the Securities
    and Exchange Commission on October 10, 2002 (File No. 000-06523)2
.7

Agreement and Plan of Merger, dated November 14, 2005, by
    and between ev3 Inc., Micro Investment, LLC and Micro
    Therapeutics, Inc.

Incorporated by reference to Exhibit 2.1 to ev3s Current
    Report on Form 8-K filed with the Securities and Exchange
    Commission on November 14, 2005 (File No. 000-51348)2
.8

Agreement and Plan of Merger dated as of July 21, 2007 by
    and among ev3 Inc., Foreigner Merger Sub, Inc. and FoxHollow
    Technologies, Inc.(2)

Incorporated by reference to Exhibit 2.1 to ev3s Current
    Report on Form 8-K filed with the Securities and Exchange
    Commission on July 23, 2007 (File No. 000-51348)2
.9

Agreement and Plan of Merger, dated as of August 26, 2006,
    by and between FoxHollow Technologies, Inc. and Kerberos
    Proximal Solutions, Inc.

Incorporated by reference to Exhibit 2.1 to FoxHollows
    Current Report on Form 8-K filed with the Securities and
    Exchange Commission on August 28, 2006 (File No. 000-50998)3
.1

Amended and Restated Certificate of Incorporation of ev3
    Inc.

Incorporated by reference to Exhibit 3.1 to ev3s Amendment
    No. 5 to Registration Statement on Form S-1 filed with the
    Securities and Exchange Commission on June 14, 2005 (File No.
    333-123851)3
.2

Amendment to Amended and Restated Certificate of Incorporation
    of ev3 Inc.

Incorporated by reference to Exhibit 99.1 to ev3s Current
    Report on Form 8-K filed with the Securities and Exchange
    Commission on June 27, 2005 (File No. 000-51348) 96




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##### Table of Contents



ExhibitNo.

Exhibit

Method of Filing3
.3

Amendment to Amended and Restated Certificate of Incorporation
    of ev3 Inc.

Incorporated by reference to Exhibit 3.1 to ev3s Current
    Report on Form 8-K filed with the Securities and Exchange
    Commission on July 23, 2007 (File No. 000-51348)3
.4

Amended and Restated Bylaws of ev3 Inc.

Incorporated by reference to Exhibit 3.1 to ev3s Current
    Report on Form 8-K filed with the Securities and Exchange
    Commission on December 3, 2008 (File No. 000-51348)4
.1

Form of Stock Certificate

Incorporated by reference to Exhibit 4.1 to ev3s Amendment
    No. 4 to Registration Statement on Form S-1 filed with the
    Securities and Exchange Commission on June 2, 2005 (File No.
    333-123851)4
.2

Holders Agreement dated as of August 29, 2003 among the
    institutional investors listed on Schedule I thereto, Dale
    A. Spencer, Paul Buckman, the individuals whose names and
    addresses appear from time to time on Schedule II thereto,
    the individuals whose names and addresses appear from time to
    time on Schedule III thereto and ev3 LLC

Incorporated by reference to Exhibit 4.2 to ev3s
    Registration Statement on Form S-1 filed with the Securities and
    Exchange Commission on April 5, 2005 (File No. 333-123851)4
.3

Operating Agreement of ev3 LLC dated as of August 29, 2003
    by and among ev3 LLC, Warburg, Pincus Equity Partners, L.P.,
    Warburg, Pincus Netherlands Equity Partners I, C.V.,
    Warburg, Pincus Netherlands Equity Partners II, C.V., Warburg,
    Pincus Netherlands Equity Partners III, C.V., Vertical
    Fund I, L.P., Vertical Fund II, L.P. and certain other
    persons party thereto

Incorporated by reference to Exhibit 4.3 to ev3s
    Registration Statement on Form S-1 filed with the Securities and
    Exchange Commission on April 5, 2005 (File No. 333-123851)4
.4

Amendment No. 1 to Operating Agreement of ev3 LLC dated as
    of March 1, 2005 by and among ev3 LLC, Warburg, Pincus
    Equity Partners, L.P., Warburg, Pincus Netherlands Equity
    Partners I, C.V., Warburg, Pincus Netherlands Equity
    Partners II, C.V., Warburg, Pincus Netherlands Equity Partners
    III, C.V., Vertical Fund I, L.P., Vertical Fund II,
    L.P. and certain other persons party thereto

Incorporated by reference to Exhibit 4.4 to ev3s
    Registration Statement on Form S-1 filed with the Securities and
    Exchange Commission on April 5, 2005 (File No. 333-123851)4
.5

Registration Rights Agreement dated as of June 21, 2005 by
    and among ev3 Inc., Warburg, Pincus Equity Partners, L.P.,
    Warburg, Pincus Netherlands Equity Partners I, C.V.,
    Warburg, Pincus Netherlands Equity Partners II, C.V., Warburg,
    Pincus Netherlands Equity Partners III, C.V., Vertical
    Fund I, L.P., Vertical Fund II, L.P. and certain other
    investors party thereto

Incorporated by reference to Exhibit 4.2 to ev3s Quarterly
    Report on Form 10-Q for the fiscal quarter ended July 3, 2005
    (File No. 000-51348)10
.1

ev3 Inc. Second Amended and Restated 2005 Incentive Stock Plan

Incorporated by reference to Exhibit 10.1 to ev3s Current
    Report on Form 8-K as filed with the Securities and Exchange
    Commission on May 17, 2007 (File No. 000-51348) 97




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##### Table of Contents



ExhibitNo.

Exhibit

Method of Filing10
.2

Form of Option Certificate under the ev3 Inc. Second Amended and
    Restated 2005 Incentive Stock Plan

Incorporated by reference to Exhibit 10.5 to ev3s
    Quarterly Report on Form 10-Q for the fiscal quarter ended
    September 28, 2008 (File No. 000-51348)10
.3

Form of Restricted Stock Grant Certificate under the ev3 Inc.
    Second Amended and Restated 2005 Incentive Stock Plan

Incorporated by reference to Exhibit 10.6 to ev3s
    Quarterly Report on Form 10-Q for the fiscal quarter ended
    September 28, 2008 (File No. 000-51348)10
.4

Form of Stock Grant Certificate applicable to French
    Participants under the ev3 Inc. Amended and Restated 2005
    Incentive Stock Plan

Incorporated by reference to Exhibit 10.7 to ev3s
    Quarterly Report on Form 10-Q for the fiscal quarter ended
    September 28, 2008 (File No. 000-51348)10
.5

ev3 LLC Amended and Restated 2003 Incentive Plan, as amended

Incorporated by reference to Exhibit 10.2 to ev3s
    Quarterly Report on Form 10-Q for the fiscal quarter ended July
    2, 2006 (File No. 000-51348)10
.6

Micro Therapeutics, Inc. 1996 Stock Incentive Plan, as amended

Incorporated by reference to Exhibit 10.7.1 to Micro
    Therapeutics, Inc.s Annual Report on Form 10-KSB for the
    fiscal year ended December 31, 2002 (File No. 000-06523)10
.7

FoxHollow Technologies, Inc. 2004 Equity Incentive Plan

Incorporated by reference to Exhibit 10.3 to FoxHollows
    Amendment No. 2  to Registration Statement on Form S-1 filed
    with the Securities and Exchange Commission on October 13, 2004
    (Registration No. 333-118191)10
.8

ev3 Inc. Employee Stock Purchase Plan

Incorporated by reference to Exhibit 10.24 to ev3s Annual
    Report on Form 10-K for the fiscal year ended December 31, 2005
    (File No. 000-51348)10
.9

ev3 Inc. Employee Performance Incentive Compensation Plan
    Effective January 1, 2008

Incorporated by reference to Exhibit 10.4 to ev3s
    Quarterly Report on Form 10-Q for the fiscal quarter ended
    September 28, 2008 (File No. 000-51348)10
.10

ev3 Inc. Employee Performance Incentive Compensation Plan
    Effective January 1, 2009

Incorporated by reference to Exhibit 10.1 to ev3s Current
    Report on Form 8-K as filed with the Securities and Exchange
    Commission on February 17, 2009 (File No. 000-51348)10
.11

Form of Indemnification Agreement between ev3 Inc. and each of
    its directors and officers

Filed herewith10
.12

Form of Change in Control Agreement among ev3 Inc., ev3
    Endovascular, Inc., Micro Therapeutics, Inc. or FoxHollow
    Technologies, Inc. and each of executive officer of ev3
    Inc.

Filed herewith10
.13

Employment and Change in Control Agreement dated as of
    April 6, 2008 between ev3 Inc. and Robert J. Palmisano

Incorporated by reference to Exhibit 10.1 to ev3s Current
    Report on Form 8-K as filed with the Securities and Exchange
    Commission on April 7, 2008 (File No. 000-51348)10
.14

Confidentiality, Non-Competition and Non-Solicitation Agreement
    dated as of April 6, 2008 between ev3 Inc. and Robert J.
    Palmisano

Incorporated by reference to Exhibit 10.2 to ev3s Current
    Report on Form 8-K as filed with the Securities and Exchange
    Commission on April 7, 2008 (File No. 000-51348) 98




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ExhibitNo.

Exhibit

Method of Filing10
.15

Robert J. Palmisano Inducement Grant Option Agreement

Incorporated by reference to Exhibit 10.4 to ev3s Current
    Report on Form 8-K as filed with the Securities and Exchange
    Commission on April 7, 2008 (File No. 000-51348)10
.16

Separation Agreement and Release of Claims, dated as of
    April 6, 2008 between ev3 Endovascular, Inc. and James M.
    Corbett

Incorporated by reference to Exhibit 10.1 to ev3s Current
    Report on Form 8-K/A as filed with the Securities and Exchange
    Commission on April 7, 2008 (File No. 000-51348)10
.17

Consulting Agreement dated as of April 6, 2008 between ev3
    Endovascular, Inc. and James M. Corbett

Incorporated by reference to Exhibit 10.4 to ev3s Current
    Report on Form 8-K/A as filed with the Securities and Exchange
    Commission on April 7, 2008 (File No. 000-51348)10
.18

Amendment to Stock Option and Stock Award Agreements made as of
    April 6, 2008 by ev3 Inc.

Incorporated by reference to Exhibit 10.2 to ev3s Current
    Report on Form 8-K/A as filed with the Securities and Exchange
    Commission on April 7, 2008 (File No. 000-51348)10
.19

Amendment to Stock Option Agreements made as of April 6,
    2008 by ev3 Inc.

Incorporated by reference to Exhibit 10.3 to ev3s Current
    Report on Form 8-K/A as filed with the Securities and Exchange
    Commission on April 7, 2008 (File No. 000-51348)10
.20

Offer Letter dated January 5, 2009 between ev3 Inc. and
    Shawn McCormick

Incorporated by reference to Exhibit 10.1 to ev3s Current
    Report on Form 8-K as filed with the Securities and Exchange
    Commission on January 9, 2009 (File No. 000-51348)10
.21

Employment Agreement effective as of January 19, 2009
    between ev3 Endovascular, Inc. and Shawn McCormick

Incorporated by reference to Exhibit 10.2 to ev3s Current
    Report on Form 8-K as filed with the Securities and Exchange
    Commission on January 9, 2009 (File No. 000-51348)10
.22

Separation Agreement and Release of Claims effective as of
    January 19, 2009 between ev3 Endovascular, Inc. and Patrick
    D. Spangler

Incorporated by reference to Exhibit 10.5 to ev3s Current
    Report on Form 8-K as filed with the Securities and Exchange
    Commission on January 9, 2009 (File No. 000-51348)10
.23

Consulting Agreement effective as of January 20, 2009
    between ev3 Endovascular, Inc. and Patrick D. Spangler

Incorporated by reference to Exhibit 10.6 to ev3s Current
    Report on Form 8-K as filed with the Securities and Exchange
    Commission on January 9, 2009 (File No. 000-51348)10
.24

Offer Letter effective July 18, 2008 between ev3 Inc. and
    Pascal E.R. Girin

Incorporated by reference to Exhibit 10.1 to ev3s Current
    Report on Form 8-K as filed with the Securities and Exchange
    Commission on July 21, 2008 (File No. 000-51348)10
.25

Separation Agreement and Release of Claims dated as of
    July 18, 2008 between ev3 Endovascular, Inc. and Matthew
    Jenusaitis

Incorporated by reference to Exhibit 10.2 to ev3s Current
    Report on Form 8-K as filed with the Securities and Exchange
    Commission on July 21, 2008 (File No. 000-51348)10
.26

Consulting Agreement dated as of July 18, 2008 between ev3
    Endovascular, Inc. and Matthew Jenusaitis

Incorporated by reference to Exhibit 10.3 to ev3s Current
    Report on Form 8-K as filed with the Securities and Exchange
    Commission on July 21, 2008 (File No. 000-51348)10
.27

Offer Letter effective as of December 5, 2008 between ev3
    Endovascular, Inc. and Stacy Enxing Seng

Filed herewith 99




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##### Table of Contents



ExhibitNo.

Exhibit

Method of Filing10
.28

Form of Subscription Agreement between ev3 Endovascular, Inc.
    (formerly known as ev3 Inc.) and Warburg, Pincus Equity
    Partners, L.P., Warburg, Pincus Netherlands Equity
    Partners I, C.V., Warburg, Pincus Netherlands Equity
    Partners II, C.V., Warburg, Pincus Netherlands Equity Partners
    III, C.V., Vertical Fund I, L.P., Vertical Fund II,
    L.P.

Incorporated by reference to Exhibit 10.33 to ev3s
    Registration Statement on Form S-1 filed with the Securities and
    Exchange Commission on April 5, 2005 (File No. 333-123851)10
.29

Loan and Security Agreement dated as of June 28, 2006 among
    Silicon Valley Bank, ev3 Endovascular, Inc., ev3 International,
    Inc. and Micro Therapeutics, Inc.

Incorporated by reference to Exhibit 10.8 to ev3s
    Quarterly Report on Form 10-Q for the fiscal quarter ended July
    2, 2006 (File No. 000-51348)10
.30

First Amendment to Loan and Security Agreement dated
    March 15, 2007 between Silicon Valley Bank and ev3
    Endovascular, Inc., ev3 International, Inc. and Micro
    Therapeutics, Inc.

Incorporated by reference to Exhibit 10.1 to ev3s Current
    Report on Form 8-K as filed with the Securities and Exchange
    Commission on March 21, 2007 (File No. 000-51348)10
.31

Consent and Second Amendment to Loan and Security Agreement
    dated October 4, 2007 between Silicon Valley Bank and ev3
    Endovascular, Inc., ev3 International, Inc. and Micro
    Therapeutics, Inc.

Incorporated by reference to Exhibit 10.38 to ev3s Annual
    Report on Form 10-K for the fiscal year ended December 31, 2007
    (File No. 000-51348)10
.32

Third Amendment to Loan and Security Agreement dated
    November 2, 2007 between Silicon Valley Bank and ev3
    Endovascular, Inc., ev3 International, Inc. and Micro
    Therapeutics, Inc.

Incorporated by reference to Exhibit 10.39 to ev3s Annual
    Report on Form 10-K for the fiscal year ended December 31, 2007
    (File No. 000-51348)10
.33

Assumption Agreement and Fourth Amendment to Loan and Security
    Agreement dated December 14, 2007 between Silicon Valley
    Bank and ev3 Endovascular, Inc., ev3 International, Inc., Micro
    Therapeutics, Inc., and FoxHollow Technologies, Inc.

Incorporated by reference to Exhibit 10.40 to ev3s Annual
    Report on Form 10-K for the fiscal year ended December 31, 2007
    (File No. 000-51348)10
.34

Fifth Amendment to Loan and Security Agreement dated
    June 24, 2008 between Silicon Valley Bank and ev3
    Endovascular, Inc., ev3 International, Inc., Micro Therapeutics,
    Inc. and FoxHollow Technologies, Inc.

Incorporated by reference to Exhibit 10.1 to ev3s Current
    Report on Form 8-K as filed with the Securities and Exchange
    Commission on June 25, 2008 (File No. 000-51348)10
.35

Sixth Amendment to Loan and Security Agreement dated
    December 22, 2008 between Silicon Valley Bank and ev3
    Endovascular, Inc., ev3 International, Inc. , Micro
    Therapeutics, Inc. and FoxHollow Technologies, Inc.

Incorporated by reference to Exhibit 10.1 to ev3s Current
    Report on Form 8-K as filed with the Securities and Exchange
    Commission on December 24, 2008 (File No. 000-51348)10
.36

Lease Agreement dated May 3, 2002 by and between Liberty
    Property Limited Partnership and ev3 Endovascular, Inc.
    (formerly known as ev3 Inc.)

Incorporated by reference to Exhibit 10.1 to ev3s
    Registration Statement on Form S-1 filed with the Securities and
    Exchange Commission on April 5, 2005 (File No. 333-123851)10
.37

First Amendment to the May 3, 2002 Lease Agreement between
    Liberty Property Limited Partnership and ev3 Endovascular, Inc.
    (formerly known as ev3 Inc.) effective as of October 17,
    2005

Incorporated by reference to Exhibit 10.2 to ev3s Annual
    Report on Form 10-K for the fiscal year ended December 31, 2006
    (File No. 000-51348) 100




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##### Table of Contents



ExhibitNo.

Exhibit

Method of Filing10
.38

Second Amendment to the May 3, 2002 Lease Agreement between
    Liberty Property Limited Partnership and ev3 Endovascular, Inc.
    (formerly known as ev3 Inc.) effective as of October 1, 2005

Incorporated by reference to Exhibit 10.3 to ev3s Annual
    Report on Form 10-K for the fiscal year ended December 31, 2006
    (File No. 000-51348)10
.39

Lease Agreement dated August 30, 2005 between Liberty
    Property Limited Partnership and ev3 Inc.

Incorporated by reference to Exhibit 10.2 to ev3s
    Quarterly Report on Form 10-Q for the fiscal quarter ended
    October 2, 2005 (File No. 000-51348)10
.40

First Amendment to the August 30, 2005 Lease Agreement
    between Liberty Property Limited Partnership and ev3 Inc.
    effective as of April 6, 2006

Incorporated by reference to Exhibit 10.5 to ev3s Annual
    Report on Form 10-K for the fiscal year ended December 31, 2006
    (File No. 000-51348)10
.41

Second Amendment to the August 30, 2005 Lease Agreement,
    between Liberty Property Limited Partnership and ev3 Inc.
    effective as of February 8, 2007

Incorporated by reference to Exhibit 10.6 to ev3s Annual
    Report on Form 10-K for the fiscal year ended December 31, 2006
    (File No. 000-51348)10
.42

Lease dated October 13, 2005 by and between Micro
    Therapeutics, Inc. and The Irvine Company

Incorporated by reference to Exhibit 10.53 to Micro
    Therapeutics, Inc.s Current Report on Form 8-K filed with
    the Securities and Exchange Commission on October 18, 2005 (File
    No. 000-06523)10
.43

Corporate Opportunity Agreement dated as of April 4, 2005
    by and between the institutional stockholders listed on
    Schedule I thereto and ev3 Inc.

Incorporated by reference to Exhibit 10.32 to ev3s
    Registration Statement on Form S-1 filed with the Securities and
    Exchange Commission on April 5, 2005 (File No. 333-123851)21
.1

Subsidiaries of ev3 Inc.

Filed herewith23
.1

Consent of Ernst & Young LLP

Filed herewith31
.1

Certification of Chief Executive Officer Pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002 and SEC
    Rule 13a-14(a)

Filed herewith31
.2

Certification of Chief Financial Officer Pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002 and SEC
    Rule 13a-14(a)

Filed herewith32
.1

Certification of Chief Executive Officer Pursuant to
    18 U.S.C. Section 1350, as Adopted Pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002

Furnished herewith32
.2

Certification of Chief Financial Officer Pursuant to
    18 U.S.C. Section 1350, as Adopted Pursuant to
    Section 906 of the Sarbanes-Oxley Act of 2002

Furnished herewith     (1)
    
    Confidential treatment under
    Rule 24b-2
    of the Securities Exchange Act of 1934, as amended, has been
    granted with respect to designated portions of this document.(2)
    
    All exhibits and schedules to the Agreement and Plan of Merger
    have been omitted pursuant to Item 601(b)(2) of
    Regulation S-K.
    ev3 will furnish the omitted exhibits and schedules to the
    Securities and Exchange Commission upon request by the
    Commission. 101