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                                                                    EXHIBIT 99.1

                                ATS MEDICAL INC.
                                  JUNE 30, 2003

CAUTIONARY STATEMENTS FOR PURPOSES OF THE "SAFE HARBOR" PROVISIONS OF THE
PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995.

         The Private Securities Litigation Reform Act of 1995 provides a "safe
harbor" for forward-looking statements to encourage companies to provide
prospective information without fear of litigation so long as those statements
are identified as forward-looking and are accompanied by meaningful cautionary
statements identifying important factors that could cause actual results to
differ materially from those projected in the statement. We desire to take
-advantage of these "safe harbor" provisions and are filing this Exhibit 99.1 in
order to do so. Accordingly, we hereby identify the following important factors
which could cause our actual results to differ materially from any such results
which may be projected, forecast, estimated or budgeted by us in forward-looking
statements made by us from time to time in reports, proxy statements,
registration statements and other written communications, or in oral
forward-looking statements made from time to time by the Company's officers and
agents. We do not intend to update any of these forward-looking statements after
the date of this Form 10-Q to conform them to actual results.

OUR HEART VALVE MAY NEVER ACHIEVE WIDESPREAD MARKET ACCEPTANCE.

         Our success will depend, in large part, on the medical community's
acceptance of the ATS heart valve. The medical community's acceptance of the ATS
heart valve will depend upon our ability to demonstrate the safety and efficacy,
advantages, long-term clinical performance and cost-effectiveness of the ATS
heart valve as compared to other prosthetic heart valves. We cannot predict
whether the medical community will accept the ATS heart valve or, if accepted,
the extent of its use. Negative publicity resulting from isolated incidents
involving the ATS heart valve or other prosthetic heart valves could have a
significant adverse effect on the overall acceptance of our heart valve. If we
encounter difficulties developing a market for the ATS heart valve in the United
States, our business and results of operations will be seriously harmed.

WE CURRENTLY RELY ON THE ATS HEART VALVE AS OUR SOLE SOURCE OF REVENUE.

         We have developed only one product, which is currently being sold
primarily outside the United States. Even if we were to develop additional
products, regulatory approval would likely be required to sell them. Clinical
testing and the approval process itself are very expensive and can take many
years. Therefore, we do not expect to be in a position to sell additional
products in the foreseeable future. As a result, if we fail to

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achieve widespread market acceptance for the ATS heart valve, our business and
results of operations will be seriously harmed.

WE NEED TO HIRE AND RETAIN A NEW SALES FORCE AND RETAIN NEW MANAGEMENT.

         We experienced losses in 2002 and 2001. In an attempt to improve our
operations and financial performance, we decided in July 2002 to implement
significant cost containment measures, including replacing most of our executive
officers with a new management team. In October 2002 we hired a new President
and Chief Executive Officer. Beginning in July 2002, we also changed our U.S.
sales strategy from a direct sales force to a hybrid of direct salespersons and
several independent manufacturer's representatives. We cannot assure you that
our efforts will be successful. Our ability to achieve operational improvements
and improve our financial performance will be subject to a number of risks and
uncertainties, including the following:

     o    our success in completing and retaining our new executive management
          team to lead ATS;

     o    the ability of the new management team to manage ATS effectively and
          increase sales of our products;

     o    our success in hiring independent manufacturer's representatives;

     o    our ability to successfully integrate and maintain a U.S. hybrid sales
          force consisting of direct sales persons and independent
          manufacturer's representatives;

     o    our ability to maintain and expand our distribution capability in
          international markets; and

     o    our ability to respond to competitive developments, including, but not
          limited to, increased pricing pressure and tissue valve competition.

         We cannot assure you that we will be able to retain our new executive
management team and hire and retain independent manufacturer's representatives
on terms and conditions acceptable to ATS. Our failure to successfully address
the risks and uncertainties listed above could have a material adverse effect on
our business, assets, prospects, financial conditions and results of operations.

OUR U.S. SALES EFFORTS MAY NOT BE SUCCESSFUL.

         Our sales approach for the sale of the ATS valve in the United States
is a hybrid of direct salespersons and independent manufacturer's
representatives. We will need to continue to expend significant funds and
management resources to develop and maintain our hybrid sales force. We believe
there is significant competition for sales personnel and independent
manufacturing representatives with the advanced sales skills and technical
knowledge we need. If we are unable to recruit, retain and motivate qualified
personnel and representatives, U.S. sales of the ATS valve could be adversely
affected. The loss of key salespersons or independent manufacturer's
representatives could have a material adverse effect on our business, assets,
prospects, financial condition and results of operations. Further, we cannot
assure the successful expansion of our network of

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independent manufacturer's representatives on terms acceptable to ATS, if at
all, or the successful marketing of our products by our hybrid sales force. In
addition, we do not control the amount and timing of marketing resources that
these third parties devote to our product. To the extent we rely on sales
through independent manufacturer's representatives, any revenues we receive will
depend primarily on the efforts of these parties.

WE CURRENTLY DEPEND ON THE MARKETING AND SALES EFFORTS OF INTERNATIONAL
INDEPENDENT DISTRIBUTORS, AND OUR SALES HAVE BEEN CONCENTRATED IN THREE
COUNTRIES.

         The ATS heart valve is sold internationally through independent
distributors. The loss of an international distributor could seriously harm our
business and results of operations if a new distributor could not be found on a
timely basis in the relevant geographic market. Sales to our Japanese, German
and Australian distributors have accounted for approximately 48% of our net
sales in fiscal year 2002 and 42% of our net sales in fiscal year 2001. We do
not control the amount and timing of marketing resources that these third
parties devote to our product. Furthermore, to the extent we rely on sales
through independent distributors, any revenues we receive will depend primarily
on the efforts of these parties. In addition, as part of our agreement with our
distributors, we allow for the return of unopened valves for credit. If a
distributor(s) were to terminate their distributorship agreement with us, we
could be obligated to buy back their inventory of valves as well as valves on
consignment at hospitals. Such a buyback could have an adverse impact on our
results of operations for the quarter and/or year in which it occurs.

WE ARE DEPENDENT UPON SALES OUTSIDE THE UNITED STATES, WHICH ARE SUBJECT TO A
NUMBER OF RISKS THAT COULD HARM OUR BUSINESS.

         Most of our commercial sales to date have been outside the United
States, and we expect that international sales will account for a substantial
majority of our revenue until we fully implement our strategy for sale of the
ATS heart valve in the United States and until the ATS heart valve receives
wider market acceptance from U.S. customers.

         There are risks inherent in doing business in international markets,
including:

     o    unforeseen changes in regulatory requirements and government health
          programs;

     o    weaker intellectual property rights protection in some countries;

     o    potentially adverse tax consequences;

     o    political and economic instability; and

     o    greater difficulty in collecting payments from product sales.

         These factors could harm our ability to successfully commercialize our
product internationally and could harm our business.

         The value of the U.S. dollar in relation to other currencies may also
harm our sales to customers outside the United States because we sell in U.S.
dollars to most of our

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customers abroad. For the year ended December 31, 2002, sales outside the United
States decreased by about 14% compared to the same period for 2001. The decrease
in sales was due primarily to competitor price pressure and the value of the
U.S. dollar against the Euro. Our sales in Europe declined 36% for the year
ended December 31, 2002 as compared to the year ended December 31, 2001. Our
dependence on sales outside of the United States will continue to expose us to
U.S. dollar currency fluctuations for the foreseeable future.

THE MARKET FOR PROSTHETIC HEART VALVES IS HIGHLY COMPETITIVE.

         The market for prosthetic heart valves is highly competitive. We expect
that competition will intensify as additional companies enter the market or
modify their existing products to compete directly with us. Our primary
competitor, St. Jude Medical, Inc., currently controls approximately 50% of the
worldwide mechanical heart valve market. Many of our competitors have
long-standing FDA approval for their valves and extensive clinical data
demonstrating the performance of their valves. In addition, they have greater
financial, manufacturing, marketing and research and development capabilities
than we have. For example, many of our competitors have the ability, due to
their internal carbon manufacturing facilities and economies of scale, to
manufacture their heart valves at a lower cost than we can manufacture our ATS
heart valve. Our primary competitor has recently used price as a method to
compete in several markets, including the United States. We might not be able to
compete successfully.

OUR FUTURE RESULTS WILL BE HARMED IF THE USE OF MECHANICAL HEART VALVES
DECLINES.

         Our business could suffer if the use of mechanical heart valves
declines. Historically, mechanical heart valves have accounted for over
two-thirds of all heart valve replacements. Recently, there has been an increase
in the use of tissue valves. We estimate that mechanical heart valves are
currently being used in 40 to 65% of all heart valve replacements, depending on
the geographic market, down from 65 to 75% about ten years ago. We believe the
tissue manufacturers' claims of improvements in tissue valve longevity and an
increase in the average age of valve patients have contributed to the recent
increase in the use of tissue valves.

NEW PRODUCTS OR TECHNOLOGIES DEVELOPED BY OTHERS COULD HARM OUR BUSINESS AND
RESULTS OF OPERATIONS.

         The medical device industry is characterized by significant
technological advances. Several companies are developing new prosthetic heart
valves based on new or potentially improved technologies. Significant advances
are also being made in surgical procedures, which may delay the need for
replacement heart valves. A new product or technology may emerge that renders
our ATS heart valve noncompetitive or obsolete.


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WE MAY NEED TO RAISE CAPITAL AND WE CANNOT BE CERTAIN THAT ADDITIONAL FINANCING
WILL BE AVAILABLE.

         We have cash in hand to support our operations and capital requirements
through 2005. After that we may need to raise additional capital. Our future
liquidity and capital requirements will depend upon several factors, including
actions related to regulatory matters, our progress in establishing our
pyrolytic carbon manufacturing operations, the extent to which the ATS heart
valve gains market acceptance and the success of our efforts to establish a new
sales force of independent manufacturer's representatives in the United States.

WE CURRENTLY MAINTAIN A LARGE VOLUME OF INVENTORY, WHICH EXCEEDS THE CURRENT
DEMAND FOR THE ATS HEART VALVE.

         We purchased pyrolytic carbon components under a long-term supply
agreement with Carbomedics through June 2002 and we are required to resume
purchases of such components in 2007. To date, our purchases of pyrolytic carbon
components have exceeded our sales of the ATS heart valves. We currently have in
inventory enough pyrolytic carbon components to satisfy our projected
requirements for over two years. If we are unable to achieve widespread
acceptance for the ATS heart valve or if competitive pressures result in price
reductions, the value of the excess inventory would likely decrease, which could
seriously harm our results of operations and financial condition. Because the
pyrolytic carbon components are made to meet the unique specifications of the
ATS heart valve, our inventory may have little, if any, value in the open
market.

CARBOMEDICS HAS A SECURITY INTEREST IN OUR INVENTORY, AND THEY MAY FORECLOSE ON
OUR INVENTORY IF WE MATERIALLY BREACH THE SUPPLY OR CARBON AGREEMENTS.

         In July 2002, ATS granted to Carbomedics a security interest in all our
inventory to secure our payment and other material obligations to them under the
supply and the carbon agreements. If we default in our payment or other material
obligations to Carbomedics under these agreements, Carbomedics could exercise
its rights as a secured creditor and attempt to foreclose on our inventory. The
foreclosure of our inventory would cause serious harm to our business and
results of operations.

WE LICENSE PATENTED TECHNOLOGY AND OTHER PROPRIETARY RIGHTS FROM CARBOMEDICS. IF
THESE AGREEMENTS ARE BREACHED OR TERMINATED, OUR BUSINESS AND RESULTS OF
OPERATIONS COULD BE SERIOUSLY HARMED.

         If our agreements with Carbomedics are breached or terminated, our
business and results of operations could be seriously harmed. Under our carbon
technology agreement with Carbomedics, we have obtained a license to use
Carbomedics' pyrolytic carbon technology to manufacture components for the ATS
heart valve. Carbomedics also has agreed to assist us in completing our
pyrolytic carbon manufacturing facility. If this agreement is breached or
terminated, our business and results of operations could be seriously harmed.


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A DELAY OR INTERRUPTION IN THE SUPPLY OF PYROLYTIC CARBON COMPONENTS OR OUR
FAILURE TO PURCHASE CERTAIN MINIMUM ANNUAL AMOUNTS COULD SERIOUSLY HARM OUR
BUSINESS.

         We cannot be certain that, after our current inventory is exhausted,
sufficient quantities of pyrolytic carbon components will be available to
assemble the ATS heart valve. We currently purchase pyrolytic carbon components
from a single source, Carbomedics, on an exclusive basis. Other than our carbon
facility, there is currently no other FDA-approved alternate supplier of our
pyrolytic carbon components. While Carbomedics has granted to us the right to
manufacture pyrolytic carbon components, we agreed to continue to purchase a
minimum annual number of pyrolytic carbon components from Carbomedics in 2007
through 2011. Failure to purchase these minimum annual amounts would give
Carbomedics the right to suspend our right to manufacture the pyrolytic carbon
components. The suspension of such rights could cause serious harm to our
business and result of operations.

BECAUSE WE LACK MANUFACTURING EXPERIENCE, WE MAY ENCOUNTER DIFFICULTIES IN
MANUFACTURING PYROLYTIC CARBON COMPONENTS FOR OUR HEART VALVE.

         Under our agreement with Carbomedics, we have been granted an exclusive
worldwide license to manufacture pyrolytic carbon components for the ATS heart
valve. We cannot be certain that our strategy to establish internal
manufacturing capabilities will result in a cost-effective means for
manufacturing the ATS heart valve. We have limited experience in manufacturing
pyrolytic carbon. We may encounter difficulties in maintaining and expanding our
manufacturing operations, including problems involving:

     o    production yields;

     o    quality control;

     o    per unit manufacturing costs;

     o    shortages of qualified personnel; and

     o    compliance with FDA and international regulations and requirements
          regarding good manufacturing practices.

         Difficulties encountered by us in establishing or maintaining a
commercial-scale manufacturing facility may limit our ability to manufacture our
heart valve and therefore could seriously harm our business and results of
operations.

OUR BUSINESS COULD BE SERIOUSLY HARMED IF THIRD-PARTY PAYORS DO NOT REIMBURSE
THE COSTS FOR OUR HEART VALVE.

         Our ability to successfully commercialize the ATS heart valve depends
on the extent to which reimbursement for the cost of our product and the related
surgical procedure is available from third-party payors, such as governmental
programs, private insurance plans and managed care organizations. Third-party
payors are increasingly

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challenging the pricing of medical products and procedures that they consider
are not cost-effective or are used for a non-approved indication. The failure by
physicians, hospitals and other users of our product to obtain sufficient
reimbursement from third-party payors would seriously harm our business and
results of operations.

         In recent years, there have been numerous proposals to change the
health care system in the United States. Some of these proposals have included
measures that would limit or eliminate payment for medical procedures or
treatments. In addition, government and private third-party payors are
increasingly attempting to contain health care costs by limiting both the
coverage and the level of reimbursement. In international markets, reimbursement
and health care payment systems vary significantly by country. In addition, we
have encountered price resistance from government-administered health programs.
Significant changes in the health care system in the United States or elsewhere,
including changes resulting from adverse trends in third-party reimbursement
programs, could have a material adverse effect on our business and results of
operations.

WE MAY FACE PRODUCT LIABILITY CLAIMS.

         The manufacture and sale of mechanical heart valves entail significant
risk of product liability claims and product recalls. A mechanical heart valve
is a life-sustaining device and the failure of any mechanical heart valve
usually results in the patient's death or need for reoperation. A product
liability claim or product recall, regardless of the ultimate outcome, could
require us to spend significant time and money in litigation or to pay
significant damages and could seriously harm our business. We currently maintain
product liability insurance coverage in an aggregate amount of $25 million.
However, we cannot assure you that our current insurance coverage is adequate to
cover the costs of any product liability claims made against us. Product
liability insurance is expensive and does not cover the costs of a product
recall. In the future, product liability insurance may not be available at
satisfactory rates or in adequate amounts.

WE DEPEND ON THE CONTINUED SERVICE OF OUR KEY PERSONNEL.

         Our future success depends on the continued services of key personnel.
We are also dependent on our ability to attract and retain technically qualified
personnel in the future. The loss of the technical knowledge and industry
expertise of these key personnel could seriously impede our success.

OUR BUSINESS WOULD BE ADVERSELY AFFECTED IF WE ARE NOT ABLE TO PROTECT OUR
INTELLECTUAL PROPERTY RIGHTS.

         Our success depends in part on our ability to maintain and enforce our
patents and other proprietary rights. We rely on a combination of patents, trade
secrets, know-how and confidentiality agreements to protect the proprietary
aspects of our technology. These measures afford only limited protection and
competitors may gain access to our intellectual property and proprietary
information. The patent positions of medical device companies are generally
uncertain and involve complex legal and technical issues.

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Litigation may be necessary to enforce our intellectual property rights, to
protect our trade secrets and to determine the validity and scope of our
proprietary rights. Any litigation could be costly and divert our attention from
the growth of the business. We cannot assure you that our patents and other
proprietary rights will not be successfully challenged, or that others will not
independently develop substantially equivalent information and technology or
otherwise gain access to our proprietary technology.

WE MAY BE SUED BY THIRD PARTIES WHICH CLAIM THAT OUR PRODUCT INFRINGES ON THEIR
INTELLECTUAL PROPERTY RIGHTS.

         We may be exposed to future litigation by third parties based on
intellectual property infringement claims. Any claims or litigation against us,
regardless of the merits, could result in substantial costs and could harm our
business. In addition, intellectual property litigation or claims could force us
to:

     o    cease manufacturing and selling our product, which would seriously
          harm us;

     o    obtain a license from the holder of the infringed intellectual
          property right, which license may not be available on reasonable
          terms, if at all; or

     o    redesign our product, which could be costly and time-consuming.

WE ARE SUBJECT TO EXTENSIVE GOVERNMENTAL REGULATION, WHICH IS COSTLY, TIME
CONSUMING AND CAN SUBJECT US TO UNANTICIPATED DELAYS.

         The ATS heart valve and our manufacturing activities are subject to
extensive regulation by a number of governmental agencies, including the FDA and
comparable international agencies. We are required to:

     o    maintain the approval of the FDA and international regulatory agencies
          to continue selling the ATS heart valve;

     o    obtain the approval of international regulatory agencies in countries
          where the ATS heart valve is not yet marketed;

     o    satisfy content requirements for all of our labeling, sales and
          promotional materials;

     o    comply with manufacturing and reporting requirements; and

     o    undergo rigorous inspections by these agencies.

         Compliance with the regulations of these agencies may delay or prevent
us from introducing any new or improved products. Violations of regulatory
requirements may result in fines, marketing restrictions, product recall,
withdrawal of approvals and civil and criminal penalties.



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THE PRICE OF OUR COMMON STOCK HAS BEEN VOLATILE.

         Historically, the market price of our common stock has fluctuated over
a wide range and it is likely that the price of our common stock will fluctuate
in the future. The market price of our common stock could be impacted by the
following:

     o    the success of our new management in operating ATS effectively;

     o    the failure of the ATS valve to gain market acceptance in the United
          States;

     o    announcements of technical innovations or new products by our
          competitors;

     o    the status of component supply arrangements;

     o    changes in reimbursement policies;

     o    government regulation;

     o    developments in patent or other proprietary rights;

     o    public concern as to the safety and efficacy of products developed by
          us or others; and

     o    general market conditions.

         In addition, due to one or more of the foregoing factors, in future
years, our results of operations may fall below the expectations of securities
analysts and investors. In that event, the market price of our common stock
could be materially and adversely affected.

The minimum bid price of our common stock was below $1.00 per share during a ten
month period beginning in 2002 and ending in March 2003. As a result, our common
stock lost its eligibility to be traded on The Nasdaq National Market and
instead was traded on The Nasdaq SmallCap Market until July 2003, when our
common stock was relisted on The Nasdaq National Market after again meeting that
market's eligibility criteria. If the minimum bid price of our stock again falls
below $1.00 for an extended period of time, we may be forced to relist our stock
on The Nasdaq SmallCap Market. If our common stock fails to meet the eligibility
criteria for continued listing on either The Nasdaq National Market or The
Nasdaq SmallCap Market, the price of our stock would, in all likelihood,
decline, and our investors would find it more difficult to dispose of or to
obtain accurate quotations as to the market value of our common stock.

OUR CHARTER DOCUMENTS AND MINNESOTA LAW MAY DISCOURAGE A TAKEOVER OF OUR
COMPANY.

         Provisions of our certificate of incorporation, bylaws and Minnesota
law could make it more difficult for a third party to acquire us, even if doing
so would be beneficial to our stockholders.