UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                            ________________________

                                   FORM 10-K/A

                        FOR ANNUAL AND TRANSITION REPORTS
                     PURSUANT TO SECTIONS 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934
(Mark  One)

[x]     ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT  OF  1934.

For  the  fiscal  year  ended  June  30,  1999

[  ]     TRANSITION  REPORT  PURSUANT  TO  SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE  ACT  OF  1934.

For  the  transition  period  from  to

                        Commission file number 000-16061
                                               ---------

                             Criticare Systems, Inc.
                -------------------------------------------------
             (Exact Name of Registrant as Specified in Its Charter)


         Delaware                                        39-1501563
-------------------------                      -----------------------------
(State  or  Other  Jurisdiction  of         (I.R.S. Employer Identification No.)
Incorporation  or  Organization)

20925 Crossroads Circle, Waukesha, Wisconsin               53186
--------------------------------------------               -----
  (Address of Principal Executive Offices)              (Zip Code)

        Registrant's telephone number, including area code:  414-798-8282
                                                             ------------

           Securities registered pursuant to Section 12(b) of the Act:

                                                  Name  of  Each  Exchange  on
     Title  of  Each  Class                             Which  Registered
     ----------------------                         --------------------------
                NA                                               NA
          -------------                                     -------------
                           [COVER PAGE 1 OF 2 PAGES.]

<PAGE>
           Securities registered pursuant to Section 12(g) of the Act:

                       Voting Common Stock, $.04 Par Value
                (together with associated Preferred Stock Purchase Rights)
      --------------------------------------------------------------------
                                (Title of class)

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

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

     The aggregate market value of the voting common stock held by nonaffiliates
of  the  registrant  as  of  August  31, 1999 was $17,445,738.  Shares of voting
common stock held by any executive officer or director of the Registrant and any
person  who beneficially owns 10% or more of the outstanding voting common stock
have  been  excluded from this computation because such persons may be deemed to
be  affiliates.  This  determination  of  affiliate  status  is not a conclusive
determination  for  other  purposes.

     On  August  31,  1999,  there  were  outstanding  8,706,151  shares  of the
registrant's  $.04  par  value  voting  common  stock.

DOCUMENTS  INCORPORATED  BY  REFERENCE

     None.

                           [COVER PAGE 2 OF 2 PAGES.]


                                        2
<PAGE>

          Criticare  Systems,  Inc.  (the  "Company")  did  not  receive  the
independent  auditors'  report  reflected  in  Item 8, the independent auditors'
report  referenced  in Item 14 with respect to Schedule VIII and the independent
auditors' consent reflected in Exhibit 21 of the Company's Annual Report on Form
10-K for the year ended June 30, 1999, as filed with the Securities and Exchange
Commission  on  September  28,  1999 (the "Annual Report").  The Company is also
amending  Part  III  of the Annual Report to include the information required by
the  items of Part III.  Accordingly, Items 6, 7 and 8 of Part II, Items 10, 11,
12  and  13  of  Part III and Item 14 of Part IV of the Annual Report are hereby
amended  in  their  entirety  as  follows:

                                     ------
                                     PART II
                                     -------

Item  6.     SELECTED  FINANCIAL  DATA.
-------      -------------------------

     The  following table sets forth selected financial data with respect to the
Company  for each of the periods indicated.  The selected financial data for the
year  ended  June  30, 1999 are derived from financial statements of the Company
which  have  not  been  audited.
<TABLE>
<CAPTION>



                                                                   Years Ended June 30,
                                                                   ----------------------
                                           1999               1998          1997          1996         1995
                                  ----------------------  ------------  ------------  ------------  -----------

<S>                               <C>                     <C>           <C>           <C>           <C>
Net Sales. . . . . . . . . . . .  $          28,512,507   $27,908,364   $26,235,355   $31,528,266   $28,660,275
Income (Loss) Before Income
   Taxes and Extraordinary Gain.             (4,388,171)     (499,276)   (2,749,435)   (4,280,989)      175,643
Net Income (Loss). . . . . . . .             (4,388,171)     (499,276)   (2,179,489)   (4,330,989)      105,643
Net Income (Loss) Per
   Common Share-Basic and
   Diluted . . . . . . . . . . .                 ($0.51)       ($0.06)       ($0.30)       ($0.63)  $      0.02

Average Shares
   Outstanding . . . . . . . . .              8,581,863     8,309,240     7,267,184     6,913,557     6,764,236
Stockholders' Equity . . . . . .  $          12,711,709   $17,282,997   $14,227,135   $13,917,549   $17,130,449
Long-term Obligations. . . . . .              4,014,356     3,165,258     5,110,934     4,669,975     3,646,867
Working Capital. . . . . . . . .             10,340,014    13,716,891    12,053,165    10,282,033    13,401,741
Total Assets . . . . . . . . . .             24,041,987    24,726,819    25,145,066    27,075,922    25,468,428
</TABLE>




                                        3
<PAGE>

Item  7.     MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF FINANCIAL CONDITION AND
-------      -------------------------------------------------------------------
RESULTS  OF  OPERATION.
----------------------

     The  discussion  in this item regarding the fiscal year ended June 30, 1999
relates  to financial statements of the Company which have not been audited.  In
the absence of an audit, there can be no assurance that the financial statements
are  fairly  presented  in  accordance  with  generally  accepted  accounting
principles.  See  Item  8  of  this  report.

RESULTS  OF  OPERATIONS

The  following  table  sets forth, for the periods indicated, certain items from
the  Company's Consolidated Statements of Operations expressed as percentages of
net  sales.

<TABLE>
<CAPTION>



                                           PERCENTAGE  OF  NET  SALES
                                            YEARS  ENDED  JUNE  30,
                                            -----------------------
                                               1999     1998    1997
                                              -------  ------  ------

<S>                                           <C>      <C>     <C>
Net sales. . . . . . . . . . . . . . . . . .   100.0%  100.0%  100.0%
Cost of goods sold . . . . . . . . . . . . .    54.5    53.3    53.6
Gross profit . . . . . . . . . . . . . . . .    45.5    46.7    46.4

Operating expenses:
Marketing. . . . . . . . . . . . . . . . . .    31.4    26.7    33.4
Research, development and engineering. . . .    10.4    11.7     8.8
Administrative . . . . . . . . . . . . . . .    14.6     7.2     9.6
Severance pay. . . . . . . . . . . . . . . .     2.8       -       -
Total. . . . . . . . . . . . . . . . . . . .    59.2    45.6    51.8
Income (loss) from operations. . . . . . . .   (13.7)    1.1    (5.4)
Interest expense . . . . . . . . . . . . . .    (1.5)   (2.9)   (4.0)
Interest income. . . . . . . . . . . . . . .      .3      .4      .1
Equity in loss of investments. . . . . . . .     (.5)    (.4)   (1.2)
Loss before income taxes and
    extraordinary gain . . . . . . . . . . .   (15.4)   (1.8)  (10.5)
Income tax provision . . . . . . . . . . . .       -       -       -
Extraordinary gain on extinguishment of debt       -       -     2.2
Net loss . . . . . . . . . . . . . . . . . .   (15.4)%  (1.8)%  (8.3)%
</TABLE>




FISCAL  YEAR  ENDED  JUNE  30,  1999  COMPARED  TO  JUNE  30,  1998

Net  sales  for  the  twelve  months  ended  June  30,  1999  increased  2.2% to
$28,512,507  from $27,908,364. The sales increase is attributable to an increase
in  OEM  sales  partially  offset  by  a  decrease  in  international  sales.

The  gross profit percentage decreased from 46.7% in 1998 to 45.5% in 1999.  The
primary  reason  for  the decrease in gross profit is the increase in OEM sales.
OEM  sales  typically have a lower gross profit than sales to non-OEM customers.

                                        4
<PAGE>

Operating  expenses  of $16,871,981 represents a 32.5% increase from fiscal 1998
levels.  Marketing  expenses increased approximately $1,486,000 when compared to
1998 levels.  This increase is due primarily to increased promotional activities
throughout  the  world.  Engineering  expenses  decreased approximately $316,000
when compared to 1998 levels; however, excluding the one-time $900,000 charge in
1998  (discussed in footnote 8 of the financial statements) engineering expenses
increased approximately $584,000.  This increase is due to expanded research and
development  efforts  related  to  new  product  introductions.  Administrative
expenses  increased  approximately $2,159,000.  This increase is attributable to
the  settlement  and  related  legal  costs  related to litigation with a former
dealer  that  represented  the  Company's  products.  The  Company also recorded
approximately  $810,000 of severance costs related primarily to costs associated
with  the  resignation  of  the  two  co-founders  of  the  Company.

Interest  expense  decreased  due to the conversion of convertible debentures to
common  stock  in  1998.

FISCAL  YEAR  ENDED  JUNE  30,  1998  COMPARED  TO  JUNE  30,  1997

Net  sales  for  the  twelve  months  ended  June  30,  1998  increased  6.3% to
$27,908,364  from  $26,235,355  for  the twelve months ended June 30, 1997.  The
sales  increase  is  attributable to the alternate care sales and new OEM sales.

The gross profit percentage remained relatively consistent at 46.7% versus 46.4%
in fiscal 1997.  Margins in domestic hospital, alternate care, and international
all  remained  relatively  consistent  with  those  of  the  prior  year.

Operating  expenses  of  $12,731,695 decreased 6.3% from fiscal 1997 levels.  In
addition,  operating  expenses  as a percentage of sales decreased to 45.6% from
51.8%  in  fiscal  1997.  The largest savings occurred in the marketing expenses
where  spending  levels were reduced by approximately $1,300,000.  The reduction
in  marketing  expenses  was  primarily  related to international spending.  The
Company  consolidated  several international functions at the home office in the
United  States.  This  resulted  in  a savings of over $850,000.  Administrative
expenses  for  fiscal  1998  decreased  by 20.4% from fiscal 1997 levels, due to
liquidation expenses incurred in fiscal 1997 related to Criticare International.
The reduced expenses in marketing and administration were partially offset by an
increase  of  41.3%  in  research,  development, and engineering expenses, which
resulted  from  a  $900,000 charge associated with the acquisition of in-process
technology  related  to  the  transmission  of  clinical  data.

Interest  expense  decreased during fiscal 1998 due to no borrowings on the line
of  credit during the year.  Interest income increased during fiscal 1998 due to
higher

                                        5
<PAGE>
cash  balances  on  hand throughout the year.  Equity in the loss of investments
relates  to  a  $120,000  advance  provided  to  Immtech  International,  Inc.

LIQUIDITY  AND  CAPITAL  RESOURCES

In  fiscal  1999,  the  Company  generated  $465,577  from operating activities,
$256,413  from  the  mortgage  refinancing discussed below, and $10,313 from the
exercise  of  stock  options.  The  Company  used  $92,776 for the retirement of
long-term  debt, $515,017 for capital expenditures, $150,000 for the purchase of
stock  and  intangible assets from Immtech International, Inc., and $193,430 for
the repurchase of Company stock.  These sources and uses of cash resulted in net
negative  cash  flow  of  $218,920  for  the  1999  fiscal  year.

In  fiscal  1998,  the  Company  generated  $448,434  from operating activities,
$194,431  from  the  exercise  of  stock  options, $120,000 from the issuance of
common  stock,  and  $82,000  from  the  exercise of warrants.  The Company used
$147,441 for retirement of long-term debt, $288,285 for capital expenditures and
$120,000  for advances to Immtech International, Inc.  These sources and uses of
cash  resulted in a net positive cash flow of $289,139 for the 1998 fiscal year.

In  March 1999, the Company refinanced its mortgage note on the Company's office
and manufacturing facility.  The new mortgage note requires monthly debt service
payments  of  approximately  $28,000  with  a  final  payment  of  approximately
$3,000,000  due  in  April  2004.

The  Company  expects  its  continued  programs  to increase accounts receivable
collections,  decrease  inventory  levels,  reduce  product  development tooling
requirements  and  stabilize  sales  demonstration  equipment levels will have a
positive  affect on cash flow activities in the next fiscal year.  Consequently,
the  Company  believes its research and development activities and other capital
and  liquidity  requirements  for the next one to two years will be satisfied by
cash  generated  from  operations and other borrowings.  During fiscal 1999, the
Company also had access to a commercial bank line of credit of up to $4,000,000.
At  June  30,  1999, there were no borrowings outstanding on the line of credit.
The  Company  violated a convenant related to maintaining a certain tangible net
worth  amount  and  achieving certain income levels.  The bank waived compliance
with  this covenant subsequent to year end.  This line expires in November 2001.

YEAR  2000  PREPARATIONS

The  Company  has  developed a plan to address company-wide Year 2000 readiness.
The  Year 2000 issue relates to computer hardware and software and other systems
designed  to  use  two  digits  rather than four digits to define the applicable
year.  As  a  result,  the  Year  2000  would  be  translated  as  two  zeroes.

                                        6
<PAGE>
Because  the Year 1900 could also be translated as two zeroes, systems which use
two  digits  could  read  the  date  incorrectly  for a number of date-sensitive
applications  resulting in potential calculation errors or the shutdown of major
systems.  The  Company  is  in  the  process  of  updating its internal computer
software,  other  information  technology  and  other  operating systems for the
purposes  of  Year 2000 compliance.  The Company will also address the Year 2000
compliance of the Company's new and existing products.  The Company has incurred
costs  of  approximately  $300,000  as  of  June  30,  1999 related to Year 2000
preparations.  The  Company  expects  to spend an additional $50,000 to complete
its  Year  2000  plan.  The  Company currently expects to complete its Year 2000
compliance plan during October 1999 and does not expect that its costs to become
Year  2000  compliant  will be material to its financial condition or results of
operations.

The  Company's  operations  may  also  be  adversely affected to the extent that
suppliers  and other third parties are not Year 2000 compliant.  The Company has
circulated  surveys  to its key third party vendors during fiscal 1999 to assess
the Year 2000 compliance status of the operating systems of such vendors and the
potential  impact  on the Company of non-compliance.  However, a number of risks
relating  to  the Year 2000 issue may be out of the Company's control, including
reliance  on  outside  links  for  essential services such as communications and
power.  There  can be no assurance that a failure of systems of third parties on
which  the  Company's systems and operations will rely to be Year 2000 compliant
will  not  have  a  material adverse effect on the Company's business, financial
condition  or  operating  results.

FORWARD-LOOKING  STATEMENTS

A  number  of the matters and subject areas discussed in this Annual Report that
are not historical or current facts deal with potential future circumstances and
developments.  These  include anticipated product introductions, expected future
financial  results,  liquidity  needs,  financing ability, Year 2000 compliance,
management's  or  the  Company's  expectations  and  beliefs and similar matters
discussed  in  Management's  Discussion and Analysis or elsewhere in this Annual
Report.  The  discussions of such matters and subject areas are qualified by the
inherent  risk  and uncertainties surrounding future expectations generally, and
also  may  materially  differ  from  the  Company's  actual  future  experience.

The  Company's  business,  operations  and  financial performance are subject to
certain  risks  and  uncertainties which could result in material differences in
actual  results  from management's or the Company's current expectations.  These
risks  and  uncertainties  include,  but  are  not  limited to, general economic
conditions,  demand  for  the  Company's  products,  costs  of  operations,  the
development  of  new

                                        7
<PAGE>
products,  government  regulation,  health  care  cost containment programs, and
competition  in  the  Company's  markets.

Item  7A.     QUANTITATIVE  AND  QUALITATIVE  DISCLOSURES  ABOUT  MARKET  RISK.
--------      ----------------------------------------------------------------

     The  Company  did not hold any market risk sensitive instruments during the
period  covered  by  this  report.

Item  8.     FINANCIAL  STATEMENTS  AND  SUPPLEMENTARY  DATA.
-------      -----------------------------------------------

Statement  Regarding  Financial  Statements:

     The  following  financial statements have not been audited.  In the absence
of  an audit, there can be no assurance that the financial statements are fairly
presented in accordance with generally accepted accounting principles.  Deloitte
&  Touche  LLP,  the  Company's  former accountants, resigned on October 5, 1999
without issuing an audit report for this Annual Report.  The Company will engage
new auditors as promptly as practicable.  The Company currently anticipates that
it  will  file an amendment to this Annual Report as soon as practicable after a
new  accounting  firm  issues  an  audit  report  for  the  periods  covered.


                                        8
<PAGE>
FINANCIAL  STATEMENTS

                    CRITICARE SYSTEMS, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                             JUNE 30, 1999 AND 1998
<TABLE>
<CAPTION>



ASSETS                                                         1999         1998

<S>                                                         <C>          <C>
CURRENT ASSETS (Note 5):
Cash and cash equivalents (Note 1) . . . . . . . . . . . .  $ 2,511,078  $ 2,729,998
Accounts receivable, less allowance for doubtful accounts
   of $375,000 and $300,000, respectively. . . . . . . . .    6,358,487    6,921,713
Other receivables. . . . . . . . . . . . . . . . . . . . .       83,106      322,976
Inventories (Notes 1 and 2). . . . . . . . . . . . . . . .    8,510,975    7,682,471
Prepaid expenses . . . . . . . . . . . . . . . . . . . . .      192,290      338,297
Total  current  assets . . . . . . . . . . . . . . . . . .   17,655,936   17,995,455

PROPERTY, PLANT AND EQUIPMENT (Notes 1 and 5):
Land . . . . . . . . . . . . . . . . . . . . . . . . . . .      925,000      925,000
Building . . . . . . . . . . . . . . . . . . . . . . . . .    3,600,000    3,600,000
Machinery and equipment. . . . . . . . . . . . . . . . . .    2,051,442    1,796,120
Furniture and fixtures . . . . . . . . . . . . . . . . . .      819,579      712,428
Demonstration and loaner monitors. . . . . . . . . . . . .    1,416,893    1,783,611
Production tooling . . . . . . . . . . . . . . . . . . . .    2,158,378    2,005,834
Property, plant and equipment - cost . . . . . . . . . . .   10,971,292   10,822,993
Less accumulated depreciation. . . . . . . . . . . . . . .    4,697,232    4,210,622
Property,  plant  and  equipment - net . . . . . . . . . .    6,274,060    6,612,371

INVESTMENTS (Notes 1, 3 and 5) . . . . . . . . . . . . . .            -            -

OTHER ASSETS (Notes 1 and 5):
License rights and patents - net . . . . . . . . . . . . .      111,991      118,993
Total  other  assets . . . . . . . . . . . . . . . . . . .      111,991      118,993
TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . . .  $24,041,987  $24,726,819
</TABLE>




See  notes  to  consolidated  financial  statements.


                                        9
<PAGE>
<TABLE>
<CAPTION>



LIABILITIES AND STOCKHOLDERS' EQUITY                                          1999          1998
------------------------------------------------------------------------  ------------  ------------

<S>                                                                       <C>           <C>
CURRENT LIABILITIES:
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $ 3,078,020   $ 2,305,721
Accrued liabilities:
    Compensation and commissions . . . . . . . . . . . . . . . . . . . .    1,446,614       819,886
    Product warranties (Note 1). . . . . . . . . . . . . . . . . . . . .      325,000       328,000
    Lawsuit settlement (Note 7). . . . . . . . . . . . . . . . . . . . .    1,600,000             -
    Deferred income. . . . . . . . . . . . . . . . . . . . . . . . . . .      380,000             -
    Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      412,395       715,603
Current maturities of long-term debt (Note 5). . . . . . . . . . . . . .       73,893       109,354
                                                                          ------------  ------------
Total  current  liabilities. . . . . . . . . . . . . . . . . . . . . . .    7,315,922     4,278,564
                                                                          ------------  ------------

LONG-TERM DEBT, less current maturities (Note 5) . . . . . . . . . . . .    3,364,356     3,165,258
                                                                          ------------  ------------

OTHER LONG-TERM OBLIGATIONS (Note 11). . . . . . . . . . . . . . . . . .      650,000             -
                                                                          ------------  ------------

CONTINGENCIES (Note 7)

STOCKHOLDERS' EQUITY (Notes 5, 6 and 8):
Preferred stock - $.04 par value, 500,000 shares authorized,
    no shares issued or outstanding. . . . . . . . . . . . . . . . . . .            -             -
Common stock - $.04 par value, 15,000,000 shares authorized,
    8,706,151 and 8,351,151 shares issued and outstanding, respectively.      348,246       334,046
Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . .   17,960,363    17,964,250
Common stock held in treasury 103,840 shares - at cost . . . . . . . . .     (193,430)            -
Retained earnings (accumulated deficit). . . . . . . . . . . . . . . . .   (5,403,470)   (1,015,299)
                                                                          ------------  ------------
Total stockholders' equity . . . . . . . . . . . . . . . . . . . . . . .   12,711,709    17,282,997
                                                                          ------------  ------------
TOTAL. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $24,041,987   $24,726,819
                                                                          ============  ============
</TABLE>



See  notes  to  consolidated  financial  statements.

                                       10
<PAGE>
                    CRITICARE SYSTEMS, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                    YEARS ENDED JUNE 30, 1999, 1998 AND 1997
<TABLE>
<CAPTION>



                                                    1999          1998          1997
                                                ------------  ------------  ------------

<S>                                             <C>           <C>           <C>
NET SALES (NOTE 10). . . . . . . . . . . . . .  $28,512,507   $27,908,364   $26,235,355

COST OF GOODS SOLD . . . . . . . . . . . . . .   15,528,314    14,870,453    14,059,508
                                                ------------  ------------  ------------

GROSS PROFIT . . . . . . . . . . . . . . . . .   12,984,193    13,037,911    12,175,847
                                                ------------  ------------  ------------

OPERATING EXPENSES:
Marketing. . . . . . . . . . . . . . . . . . .    8,941,036     7,454,619     8,761,731
Research, development and engineering (Note 8)    2,963,134     3,278,714     2,320,655
Administrative (Note 7). . . . . . . . . . . .    4,157,811     1,998,362     2,509,506
Severance pay (Note 11). . . . . . . . . . . .      810,000             -             -
                                                ------------  ------------  ------------
Total. . . . . . . . . . . . . . . . . . . . .   16,871,981    12,731,695    13,591,892
                                                ------------  ------------  ------------

INCOME (LOSS) FROM OPERATIONS. . . . . . . . .   (3,887,788)      306,216    (1,416,045)
                                                ------------  ------------  ------------

OTHER INCOME (EXPENSE):
Interest expense (Note 5 and 6). . . . . . . .     (432,477)     (797,376)   (1,048,391)
Interest income. . . . . . . . . . . . . . . .       82,094       111,884        39,001
Equity in loss of investments (Notes 1 and 3).     (150,000)     (120,000)     (324,000)
                                                ------------  ------------  ------------
Total. . . . . . . . . . . . . . . . . . . . .     (500,383)     (805,492)   (1,333,390)
                                                ------------  ------------  ------------

LOSS BEFORE INCOME TAXES
    AND EXTRAORDINARY GAIN . . . . . . . . . .   (4,388,171)     (499,276)   (2,749,435)

INCOME TAX PROVISION (NOTES 1 AND 4) . . . . .            -             -             -
                                                ------------  ------------  ------------

LOSS BEFORE EXTRAORDINARY GAIN . . . . . . . .   (4,388,171)     (499,276)   (2,749,435)

EXTRAORDINARY GAIN ON EXTINGUISHMENT
    OF DEBT (NOTE 5) . . . . . . . . . . . . .            -             -       569,946

NET LOSS . . . . . . . . . . . . . . . . . . .  $(4,388,171)  $  (499,276)  $(2,179,489)
                                                ============  ============  ============

LOSS PER COMMON SHARE-
BASIC AND DILUTED: (NOTE 1)
Before extraordinary gain. . . . . . . . . . .  $      (.51)  $      (.06)  $      (.38)
Extraordinary gain . . . . . . . . . . . . . .            -             -           .08
                                                ------------  ------------  ------------

NET LOSS PER COMMON SHARE. . . . . . . . . . .  $      (.51)  $      (.06)  $      (.30)
                                                ============  ============  ============

WEIGHTED AVERAGE NUMBER OF COMMON
    SHARES OUTSTANDING (NOTE 8):
Basic. . . . . . . . . . . . . . . . . . . . .    8,581,863     8,309,240     7,267,184
Diluted. . . . . . . . . . . . . . . . . . . .    8,581,863     8,309,240     7,267,184
                                                ============  ============  ============
</TABLE>



See  notes  to  consolidated  financial  statements.

                                       11
<PAGE>
                    CRITICARE SYSTEMS, INC. AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                    YEARS ENDED JUNE 30, 1999, 1998 AND 1997

<TABLE>
<CAPTION>



                                                                      Additional    Common Stock
                                       Common Stock                   Paid-In       Treasury
                                       Shares         Amount          Capital       No. of Shares    Cost
<S>                                    <C>            <C>             <C>           <C>              <C>
BALANCE, JUNE 30, 1996. . . . . . . .     7,128,272   $     285,131   $11,995,118
Net loss. . . . . . . . . . . . . . .
Foreign currency translation
    adjustments . . . . . . . . . . .
Comprehensive income/(loss) . . . . .
Common stock issued in connection
    with extinguishment of debt . . .       200,000           8,000       772,000
Exercise of options and warrants. . .       252,020          10,081       570,838
Convertible debentures converted
    to common stock, net of $61,872
    of unamortized issuance costs . .       216,173           8,647     1,047,075
Issuance of warrants for services . .                                      84,375

BALANCE, JUNE 30, 1997. . . . . . . .     7,796,465         311,859    14,469,406
Net loss. . . . . . . . . . . . . . .
Foreign currency translation
    adjustments . . . . . . . . . . .
Comprehensive income/(loss) . . . . .
Issuance of common stock. . . . . . .        20,425             817       119,183
Exercise of options and warrants. . .       126,500           5,060       271,371
Convertible debentures converted
    to common stock, net of $100,822
    of unamortized issuance costs . .       407,761          16,310     2,181,225
Commitment to issue common
    stock for patented technology . .                                     900,000
Issuance of warrants for services . .                                      23,065

BALANCE, JUNE 30, 1998. . . . . . . .     8,351,151         334,046    17,964,250
Net loss. . . . . . . . . . . . . . .
Comprehensive income/(loss) . . . . .
Issuance of common stock for
    patented technology . . . . . . .       350,000          14,000       (14,000)
Exercise of options and warrants. . .         5,000             200        10,113
Common stock repurchased. . . . . . .                                                      103,840   $    (193,430)

BALANCE, JUNE 30, 1999. . . . . . . .     8,706,151   $     348,246   $17,960,363          103,840   $    (193,430)

                                       Retained         Accumulated
                                       Earnings         Other         Total
                                       (Accumulated     Comprehensive Stockholders'
                                       Deficit)         Income/Loss   Equity
<S>                                    <C>              <C>           <C>
BALANCE, JUNE 30, 1996. . . . . . . .  $    1,663,466   $   (26,166)  $13,917,549
Net loss. . . . . . . . . . . . . . .      (2,179,489)                 (2,179,489)
Foreign currency translation
    adjustments . . . . . . . . . . .                       (11,941)      (11,941)
Comprehensive income/(loss) . . . . .                                  (2,191,430)
Common stock issued in connection
    with extinguishment of debt . . .                                     780,000
Exercise of options and warrants. . .                                     580,919
Convertible debentures converted
    to common stock, net of $61,872
    of unamortized issuance costs . .                                   1,055,722
Issuance of warrants for services . .                                      84,375

BALANCE, JUNE 30, 1997. . . . . . . .      (516,023)        (38,107)   14,227,135
Net loss. . . . . . . . . . . . . . .      (499,276)                     (499,276)
Foreign currency translation
    adjustments . . . . . . . . . . .                        38,107        38,107
Comprehensive income/(loss) . . . . .                                    (461,169)
Issuance of common stock. . . . . . .                                     120,000
Exercise of options and warrants. . .                                     276,431
Convertible debentures converted
    to common stock, net of $100,822
    of unamortized issuance costs . .                                   2,197,535
Commitment to issue common
    stock for patented technology . .                                     900,000
Issuance of warrants for services . .                                      23,065

BALANCE, JUNE 30, 1998. . . . . . . .     (1,015,299)                  17,282,997
Net loss. . . . . . . . . . . . . . .     (4,388,171)                  (4,388,171)
Comprehensive income/(loss) . . . . .                                  (4,388,171)
Issuance of common stock for
    patented technology . . . . . . .                                           -
Exercise of options and warrants. . .                                      10,313
Common stock repurchased. . . . . . .                                    (193,430)

BALANCE, JUNE 30, 1999. . . . . . . .  $   (5,403,470)               $ 12,711,709
</TABLE>

See  notes  to  consolidated  financial  statements.


                                       12
<PAGE>
                    CRITICARE SYSTEMS, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                    YEARS ENDED JUNE 30, 1999, 1998 AND 1997
<TABLE>
<CAPTION>



                                                                     1999         1998          1997
<S>                                                                  <C>           <C>          <C>
OPERATING ACTIVITIES:
Net loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $(4,388,171)  $ (499,276)  $(2,179,489)
Adjustments to reconcile net loss to net cash
    provided by (used in) operating activities:
         Depreciation . . . . . . . . . . . . . . . . . . . . . . .      486,610      721,476       709,618
         Amortization . . . . . . . . . . . . . . . . . . . . . . .        7,002       21,440        74,749
         Interest and discount accrued on convertible debentures. .            -      462,034       451,438
         Provision for doubtful accounts. . . . . . . . . . . . . .      380,004       99,000       366,505
         Expense related to equity in loss of investments . . . . .      150,000      120,000       324,000
         Expense related to issuance of warrants for services . . .            -       23,065        84,375
         Expense related to commitment to issue common stock
             for patented technology. . . . . . . . . . . . . . . .            -      900,000             -
         Extraordinary gain on extinguishment of debt . . . . . . .            -            -      (569,946)
        Changes in assets and liabilities:
              Accounts receivable . . . . . . . . . . . . . . . . .      183,222      161,524     2,321,416
              Other receivables . . . . . . . . . . . . . . . . . .      239,870      (86,121)      117,783
              Inventories . . . . . . . . . . . . . . . . . . . . .     (461,786)      46,207        93,351
              Prepaid expenses. . . . . . . . . . . . . . . . . . .      146,007      (68,677)      (81,488)
              Accounts payable. . . . . . . . . . . . . . . . . . .      772,299     (768,284)     (509,017)
              Accrued liabilities . . . . . . . . . . . . . . . . .    2,950,520     (683,954)      287,876
Net cash provided by  operating activities. . . . . . . . . . . . .      465,577      448,434     1,491,171

INVESTING ACTIVITIES:
Purchases of property, plant and equipment, net . . . . . . . . . .     (515,017)    (287,205)     (134,785)
Purchase of license rights. . . . . . . . . . . . . . . . . . . . .            -       (1,080)      (40,815)
Advances to Immtech International, Inc. . . . . . . . . . . . . . .     (150,000)    (120,000)      (24,000)
Net cash used in investing activities . . . . . . . . . . . . . . .     (665,017)    (408,285)     (199,600)

FINANCING ACTIVITIES:
Proceeds from mortgage refinancing. . . . . . . . . . . . . . . . .      256,413            -             -
Repayment of mortgage . . . . . . . . . . . . . . . . . . . . . . .   (3,193,587)           -             -
Repurchase of Company stock . . . . . . . . . . . . . . . . . . . .     (193,430)           -             -
Borrowings (payments) under line of credit facility . . . . . . . .            -            -    (2,300,000)
Proceeds from the issuance of convertible debentures. . . . . . . .            -            -     2,500,000
Principal payments on long-term debt. . . . . . . . . . . . . . . .      (92,776)    (147,441)     (217,619)
Convertible debenture issuance costs. . . . . . . . . . . . . . . .            -            -      (220,657)
Proceeds from issuance of common stock. . . . . . . . . . . . . . .       10,313      396,431       580,919
Net cash (used in) provided by financing activities . . . . . . . .      (19,480)     248,990       342,643

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS. . . . . . . .     (218,920)     289,139     1,634,214
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR. . . . . . . . . . . .    2,729,998    2,440,859       806,645
CASH AND CASH EQUIVALENTS, END OF YEAR. . . . . . . . . . . . . . .  $ 2,511,078   $2,729,998   $ 2,440,859
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for:
     Income taxes (refunded) paid-net . . . . . . . . . . . . . . .  $     8,010   $    8,525   $   (87,626)
     Interest . . . . . . . . . . . . . . . . . . . . . . . . . . .      437,401      335,342       456,880
Noncash investing and financing activities:
     Common stock issued in connection with extinguishment of debt.            -            -       780,000
     Common stock issued upon conversion of convertible debentures,
        net of $100,822 and $61,872 of unamortized issuance costs .            -    2,197,535     1,055,722
     Issuance of warrants for services. . . . . . . . . . . . . . .            -       23,065        84,375
     Commitment to issue common stock for patented technology . . .            -      900,000             -
</TABLE>


See  notes  to  consolidated  financial  statements.

                                       13
<PAGE>
NOTES  TO  FINANCIAL  STATEMENTS

CRITICARE  SYSTEMS,  INC.  AND  SUBSIDIARIES
NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
YEARS  ENDED  JUNE  30,  1999,  1998  AND  1997



1.     SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES

     PRINCIPLES OF CONSOLIDATION - The consolidated financial statements include
the  accounts  of  Criticare  Systems, Inc. (the "Company") and its wholly owned
subsidiaries:  Criticare  International  GmbH  Marketing  Services  ("Criticare
International"),  CSI  Trading,  Inc.  ("CSI  Trading"), Criticare Service GmbH,
Criticare  Biomedical,  Inc.  ("Criticare Biomedical"), Sleep Care, Inc. ("Sleep
Care"),  Criticare  (FSC),  Inc.  and CSI International Corp. (DISC).  Criticare
International  was  liquidated during fiscal 1998.  CSI Trading was incorporated
in  November 1996 to assist with European marketing activities.  All significant
intercompany  accounts  and  transactions  have  been  eliminated.

     CASH  EQUIVALENTS  -  The  Company considers all investments with purchased
maturities  of  less  than  three  months  to  be  cash  equivalents.

     INVENTORIES  -  Inventories are stated at the lower of cost or market, with
cost  determined  on  the  first-in,  first-out  method.

     INVESTMENTS  -  The  Company  accounts  for  its  investment  in  Intercare
Technologies,  Inc.  ("Intercare")  on  the  cost  method  and  accounts for its
investment  in  Immtech  International, Inc. ("Immtech") and Blatz House Offices
Limited Partnership (the "Blatz Partnership") on the equity method (see Note 3).

     PROPERTY,  PLANT  AND EQUIPMENT - Property, plant and equipment is recorded
at  cost.  Each  member  of  the  Company's  sales  force  is  provided  with
demonstration monitors to assist them in their sales efforts.  Also, the Company
has loaner monitors which are used to temporarily replace a customer's unit when
it  is  being repaired or upgraded.  Depreciation is provided over the estimated
useful  lives  of  the assets.  The building is being depreciated over 40 years,
and  the remaining assets are being depreciated over three to seven years, using
primarily  the  straight-line  method.

     LICENSE  RIGHTS AND PATENTS - License rights and patents are amortized over
the  estimated  useful  lives  of  the  related  agreements  using primarily the
straight-line  method.  Approximately  $7,000,  $7,000,  and  $9,000  of

                                       14
<PAGE>
amortization  was  charged  to  operations in 1999, 1998 and 1997, respectively.
Accumulated  amortization  approximated $85,000 and $78,000 at June 30, 1999 and
1998,  respectively.

     CONVERTIBLE DEBENTURE ISSUANCE COSTS - Convertible debenture issuance costs
were  amortized over the two-year term of the debentures.  Approximately $15,000
and  $46,000  of  amortization  was charged to operations in 1998 and 1997.  The
prorata  amount  of  unamortized  debenture  issuance  costs  were  charged  to
additional  paid-in-capital  upon  conversion of the debentures to common stock.
Unamortized  debenture  issuance  costs  charged  to  additional paid-in capital
amounted  to  $100,822  and  $61,872  during  1998  and  1997.  (See  Note  6.)

     GOODWILL  - Goodwill relating to the excess of the cost over the fair value
of  the  net assets of an acquired subsidiary was amortized on the straight-line
method over approximately five years.  Approximately $20,000 of amortization was
charged  to operations in 1997.  The goodwill was fully amortized as of June 30,
1997.

     REVENUE  RECOGNITION  -  Revenues  and  the  costs  of  products  sold  are
recognized  as  the  related  products  are  shipped  or installed, if there are
significant  installation  costs.

     PRODUCT WARRANTIES - Estimated costs for product warranties are accrued for
and  charged  to  operations  as  the  related  products  are  shipped.

     RESEARCH  AND  DEVELOPMENT  EXPENSES  -  Research and development costs are
charged  to  operations  as  incurred.  Such  expenses  approximated $2,798,000,
$3,156,000,  and  $2,175,000  in  1999,  1998  and 1997, respectively.  The 1998
amount  includes  $900,000 related to certain acquired patented technology which
was  charged  to  operations as in-process research and development costs at the
time  of  the  acquisition.  (See  Note  8.)

     INCOME  TAXES  -  The  Company accounts for income taxes using an asset and
liability  approach.  Deferred  income  tax  assets and liabilities are computed
annually for differences between the financial statement and tax bases of assets
and  liabilities that will result in taxable or deductible amounts in the future
based  on  enacted  tax  laws  and  rates applicable to the periods in which the
differences  are  expected  to  affect  taxable  income.

     FOREIGN  CURRENCY  TRANSLATION  -  The  effects of unrealized exchange rate
fluctuations  from  translating  foreign  currency  assets  and liabilities into
United  States  dollars are accumulated as cumulative translation adjustments in
stockholders'  equity.

                                       15
<PAGE>

     NET  INCOME  (LOSS)  PER  COMMON  SHARE  - Basic income (loss) per share is
computed  using  the weighted average number of common shares outstanding during
the  periods.  Diluted  income  per share is computed using the weighted average
number  of  common  and dilutive common equivalent shares outstanding during the
periods.

     FAIR  VALUE  OF  FINANCIAL STATEMENTS - The Company's financial instruments
under  Statement  of  Financial  Account  Standards ("SFAS") No. 107 "Disclosure
About  Fair Value of Financial Instruments," includes cash, accounts receivable,
accounts  payable,  borrowings under line of credit facility and long-term debt.
The  Company  believes  that  the  carrying  amounts  of  these  accounts  are a
reasonable estimate of their fair value because of the short-term nature of such
instruments  or,  in  the  case  of  long-term  debt  because  of interest rates
available  to  the  Company  for  similar  obligations.

     COMPREHENSIVE  INCOME  -  In  1999,  the  Company  adopted  SFAS  No.  130,
"Reporting  Comprehensive  Income."  This  statement  establishes  rules for the
reporting  of  comprehensive  income  and  its components.  Comprehensive income
consists  of  net  income  and  foreign  currency translation adjustments and is
presented  in  the Consolidated Statement of Stockholders' Equity.  The adoption
of  SFAS  130 had no impact on total stockholders' equity.  Prior year financial
statements  have  been  reclassified  to  conform  to the SFAS 130 requirements.

     APPROVED ACCOUNTING STANDARDS - In 1998, the FASB also issued SFAS No. 133,
"Accounting  for Derivative Instruments and Hedging Activities."  This statement
is  required  to  be  adopted  in  fiscal 2001.  The Company is currently in the
process  of  evaluating  the  impact  of  adopting  SFAS  No.  133.

     USE  OF  ESTIMATES  - The preparation of financial statements in conformity
with  generally  accepted  accounting  principles  requires  management  to make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities  and  disclosure of contingent assets and liabilities at the date of
the  financial  statements  and  the  reported  amounts of revenues and expenses
during  the reporting period.  Actual results could differ from those estimates.


                                       16
<PAGE>
2.     INVENTORIES

     Inventories  consist  of  the  following  as  of  June  30:
<TABLE>
<CAPTION>



                      1999        1998
<S>                <C>         <C>
Component parts .  $3,790,728  $2,647,231
Work in process .   1,261,709   1,409,187
Finished units. .   3,458,538   3,626,053
Total inventories  $8,510,975  $7,682,471
</TABLE>



3.     INVESTMENTS

     INTERCARE TECHNOLOGIES, INC. - During 1992, the Company's subsidiary, Sleep
Care,  transferred  certain assets to Intercare Technologies, Inc. ("Intercare")
in  exchange  for 75,000 shares of convertible preferred stock of Intercare with
an  estimated  fair  value  of  $300,000,  at that time.  In connection with the
transfer,  Sleep  Care  licensed to Intercare the rights to certain intellectual
property  and  technology,  primarily  license  rights  and  patents, related to
products previously marketed by Sleep Care.  In exchange for the license rights,
the  Company  is  to receive royalties of 5% of the gross revenues from sales of
products  licensed under the agreement.  No royalty income was recognized during
1999,  1998  and  1997  and  no  royalty income is expected in future years. The
assets  retained  by  Sleep  Care  were  fully  amortized  as  of June 30, 1996.
Amortization  of  the intellectual property approximated $8,000 in 1996.  During
the year ended June 30, 1997, management of the Company concluded the investment
in  Intercare  was impaired and the carrying value of the investment was reduced
from  $300,000  to  zero.

     IMMTECH  INTERNATIONAL,  INC.  -  The  Company  owns comon stock of Immtech
International,  Inc.  ("Immtech").  Immtech  is  a  biopharmaceutical  company
focusing on the discovery and commercialization of therapeutics for treatment of
patients  afflicted with opportunistic infectious diseases, cancer, or comprised
immune systems.  Immtech has two independent programs for developing drugs:  one
based  on  a  technology  for  the design of a class of pharmaceutical compounds
referred  to  as  dications.  The  second  is  based  on  developing a series of
biological  proteins  that  work in conjunction with the immune system.  Immtech
has  no  products  currently  for sale, and none are expected to be commercially
available  for  several  years.  Immtech  has  a  March  31  fiscal  year  end.


                                       17
<PAGE>
     The  following  is a summary of the Company's investment in and advances to
Immtech  as  of  June  30,  1999  and  1998:
<TABLE>
<CAPTION>



                                       1999          1998
<S>                                <C>           <C>
Investment in Immtech . . . . . .  $ 2,736,000   $ 2,586,000
Advances to Immtech . . . . . . .      863,940       863,940
Total . . . . . . . . . . . . . .    3,599,940     3,449,940
Less investment losses recognized   (3,599,940)   (3,449,940)
Net investment. . . . . . . . . .  $         0   $         0
</TABLE>



     During  July  1998,  the Company purchased certain intangible assets and an
additional  172,414 shares of Immtech stock for $150,000.  These intangibles and
shares of stock were subsequently sold to a related party as part of a severance
agreement  for  $150,000  (see  note  11).

     The  Company  has recognized investment losses related to the investment in
Immtech  of $150,000, $120,000 and $24,000 in 1999, 1998 and 1997, respectively.
As of June 30, 1999, the Company owned approximately 20% of Immtech's issued and
outstanding  common  stock.

     During  April 1999, Immtech completed an Initial Public Offering ("IPO") of
its  stock.  As  part  of  this  IPO, the Company was required to sign a lock-up
agreement  by  which  it was agreed that no shares owned by the Company could be
sold  in  the  public  market until the Immtech stock traded at $20 (200% of its
initial IPO) price ($10) for 20 consecutive trading days and one year has passed
from the date of the IPO.  The lock-up agreement expires in April 2004.  At June
30,  1999,  the  lock-up  provisions  were  still in force. Unrestricted Immtech
shares  were  trading  at  $17.50  on  June  30,  1999.

     Subsequent  to  June  30,  1999,  the Company sold a portion of its Immtech
stock  in  a  Private  Placement.  The  proceeds from this sale were $1,760,000.

     The  following  is summarized financial information for Immtech at June 30,
1999  and  1998  and  for  the  twelve  months  then  ended.
<TABLE>
<CAPTION>



                                                   1999          1998

<S>                                            <C>           <C>
Current assets. . . . . . . . . . . . . . . .  $ 8,541,000   $    84,000
Noncurrent assets . . . . . . . . . . . . . .       68,000       111,000
Current liabilities . . . . . . . . . . . . .      253,000     4,097,000
Noncurrent liabilities. . . . . . . . . . . .            -             -
Redeemable preferred stock. . . . . . . . . .            -     5,548,000
Common stockholders' equity (deficit) . . . .    8,356,000    (9,450,000)
Revenues. . . . . . . . . . . . . . . . . . .      136,000       156,000
Net loss. . . . . . . . . . . . . . . . . . .   (8,341,000)   (1,152,000)
Net loss attributable to common stockholders.   (4,657,000)   (1,666,000)
</TABLE>




                                       18
<PAGE>
     BLATZ  PARTNERSHIP  -  The  Company  was the sole limited partner in a real
estate  limited  partnership  which  owns  the  Blatz Phase II Commercial Office
Buildings  located  in  Milwaukee,  Wisconsin.  Under  terms  of the Partnership
Agreement (the "Agreement"), profits and losses (other than those resulting from
a sale or refinancing of the Project) were allocated 40% to the general partners
and  60%  to the Company.  This investment was sold during 1999, resulting in no
material  gain  or  loss.


4.     INCOME  TAXES

     The Company accounts for income taxes using an asset and liability approach
which  generally  requires  the  recognition  of  deferred income tax assets and
liabilities  based on the expected future income tax consequences of events that
have  previously  been  recognized  in the Company's financial statements or tax
returns.  In  addition, a valuation allowance is recognized if it is more likely
than not that some or all of the deferred income tax asset will not be realized.
A  valuation  allowance  is  used  to offset the related net deferred income tax
assets  due  to uncertainties of realizing the benefits of certain net operating
loss  and  tax  credit  carryforwards.

     Significant  components  of  the  Company's  deferred income tax assets and
deferred  income  tax  liabilities  are  as  follows:
<TABLE>
<CAPTION>



                                                JUNE 30,    JUNE 30,    JULY 1,
                                                  1999        1998        1997
<S>                                            <C>         <C>         <C>
Deferred income tax assets:
     Accounts receivable and sales allowances  $  170,000  $  156,000  $  237,000
     Inventory allowances . . . . . . . . . .     254,000     110,000     207,000
     Product warranties . . . . . . . . . . .     127,000     128,000     144,000
     Other accrued liabilities. . . . . . . .     243,000      86,000      98,000
     Severance pay accrual. . . . . . . . . .     279,000           -           -
     Lawsuit settlement . . . . . . . . . . .     626,000           -           -
     Federal net operating loss carryforwards   2,244,000   1,870,000   1,717,000
     State net operating loss carryforwards .     325,000     270,000     255,000
     Federal tax credit carryforwards . . . .     152,000     152,000     198,000
     Investment losses not deducted . . . . .   1,481,000   1,481,000   1,434,000
     Total deferred income tax assets . . . .   5,901,000   4,253,000   4,290,000
</TABLE>


<TABLE>
<CAPTION>



                                                                 JUNE 30,      JUNE 30,      JULY 1,
                                                                   1999          1998          1997
<S>                                                            <C>           <C>           <C>
Deferred income tax liabilities:
     Excess of tax over book depreciation and amortization. .     (619,000)     (596,000)   (1,007,000)
     Prepaid expenses . . . . . . . . . . . . . . . . . . . .       (7,000)       (3,000)       (6,000)
     Total deferred income tax liabilities. . . . . . . . . .     (626,000)     (599,000)   (1,013,000)

     Valuation allowance. . . . . . . . . . . . . . . . . . .   (5,275,000)   (3,654,000)   (3,277,000)

     Net deferred income taxes recognized in the consolidated
          balance sheets. . . . . . . . . . . . . . . . . . .  $         0   $         0   $         0
</TABLE>



                                       19
<PAGE>


     At  June 30, 1999, the Company had Federal net operating loss carryforwards
of  approximately  $6,600,000  which  expire  in 2008 through 2019.  At June 30,
1999,  the  Company  had available for federal income tax purposes approximately
$41,000  of  alternative  minimum  tax  credit carryforwards which carry forward
indefinitely and approximately $111,000 tax credit carryforwards which expire in
the  years  2007 through 2009.  The Company also has approximately $6,500,000 of
state  net  operating  loss  carryforwards,  which  expire in 2002 through 2019,
available  to  offset  certain  future  state  taxable  income.

     The  income  tax  provision  consists  of  the  following:
<TABLE>
<CAPTION>



                                 1999   1998   1997
<S>                              <C>    <C>    <C>
Current
     Federal. . . . . . . . . .  $   0  $   0  $   0
     State. . . . . . . . . . .      0      0      0
     Total income tax provision  $   0  $   0  $   0
</TABLE>



     A reconciliation of the provision for income taxes (benefit) at the federal
statutory  income  tax  rate  to  the  effective  income  tax  rate  follows:
<TABLE>
<CAPTION>



                                                1999     1998     1997

<S>                                            <C>      <C>      <C>
     Federal statutory income tax rate. . . .  (34.0)%  (34.0)%  (34.0)%
     Losses for which no benefit was provided    29.3     30.9     29.1
     Non-deductible losses of subsidiaries. .     3.2        -      4.0
     Other-net. . . . . . . . . . . . . . . .     1.5      3.1       .9
     Effective income tax rate. . . . . . . .       0%       0%       0%
</TABLE>




5.     LINE  OF  CREDIT  FACILITY  AND  LONG-TERM  DEBT
<TABLE>
<CAPTION>



                                                                                    1999        1998
<S>                                                                              <C>         <C>
Long-term debt consists of the following:

     Mortgage note, 7.5% due in monthly installments of $27,793
          with a final payment of $3,048,253 due in April 1, 2004,
          collateralized by real estate with a carrying value of approximately
          $3,934,000 at June 30, 1999.. . . . . . . . . . . . . . . . . . . . .  $3,438,249           -
     Mortage note, 9.625% due in monthly installments of $34,983
         with a final payment of $2,688,336 due in December 2002,
         collateralized by real estate (refinanced in 1999) . . . . . . . . . .  $3,274,612
     Total. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $3,438,249  $3,274,612
     Less current maturities. . . . . . . . . . . . . . . . . . . . . . . . . .      73,893     109,354
     Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $3,364,356  $3,165,258
</TABLE>



                                       20
<PAGE>
     Aggregate  annual  principal payments required under terms of the long-term
debt  agreements  are  as  follows:
<TABLE>
<CAPTION>



Years Ending June 30,  Principal Payments
<S>                    <C>
2000. . . . . . . . .  $            73,893
2001. . . . . . . . .               79,430
2002. . . . . . . . .               86,764
2003. . . . . . . . .               93,596
2004. . . . . . . . .            3,104,566
Total . . . . . . . .  $         3,438,249
</TABLE>



     In  March  1999,  the Company refinanced its morgtage note on the Company's
office  and manufacturing facility. The Company incurred a prepayment penalty of
approximately  $120,000  which  was  recorded  as  interest  expense.

     At  June  30,  1999,  the  Company  had  a $4,000,000 demand line of credit
facility  with  a  commercial  bank  to  meet  its  short-term  borrowing needs.
Borrowings  against the line are payable on demand with interest payable monthly
at  the bank's reference rate, plus .25% (8.0% as of June 30, 1999).  As of June
30,  1999,  there were no borrowings against the line. Borrowings under the line
of  credit  facility  are  collateralized  by  substantially  all  assets of the
Company.  The  credit  facility  has  covenants  which require minimum levels of
tangible  net  worth  and income levels.  The Company was not in compliance with
these covenants at June 30, 1999.  This non-compliance was waived by the lending
institution,  and  the line of credit facility was extended until November 2001.

     In  March  1997,  the  Company  satisfied a $1,240,000 promissory note plus
interest  accrued  on the note of approximately $110,000 in exchange for 200,000
shares of newly issued common stock.  Under the provisions of the agreement, the
shares must be held for one full year prior to resale.  In conjunction with this
transaction, the Company recorded an extraordinary gain on the extinguishment of
debt  of  $569,946 for the outstanding indebtedness under the promissory note in
excess  of  the  estimated  fair  market  value  of  the  restricted  stock.


6.     CONVERTIBLE  DEBENTURES

     In  February 1997, the Company issued $2,500,000 of convertible debentures.
The  debentures  had  a  two year term to maturity with a stated annual interest
rate of 8%, payable in shares of common stock at the conversion date or maturity
date.  The  holders of the debentures had the option to convert up to $1,250,000
of  the debentures and accrued interest to common stock of the Company sixty-one
(61)  days after the February 1997 closing date at a conversion price equal to a
20%  discount  from  the  average  closing  bid  price  of

                                       21
<PAGE>
the  Company's  common  stock  for  the five days preceding the conversion date.
Debentures aggregating $550,000 were converted under the 20% discount conversion
feature.  The remaining debentures and accrued interest were converted to common
stock  of  the  Company  at  a conversion price equal to a 25% discount from the
average  closing  bid  price  of  the  Company's  common stock for the five days
preceding  the  conversion  date.  For  the  years ended June 30, 1998 and 1997,
$1,650,000  and  $850,000  of  debentures  were converted to 407,761 and 216,173
shares  of common stock with a fair market value of $2,298,357 and $1,117,594 as
of  the  conversion  dates.

     Proceeds  from  the issuance of the debentures were recorded as a liability
at  the  issuance  date.  The  conversion discount was amortized and reported as
additional  interest  expense  over  the  life  of  the  debentures.  Additional
interest expense wasrecognized for any unamortized discount as of the conversion
date.  The  debentures  were  included  in  the  accompanying  June  30,  1997
consolidated  balance sheet at the issuance price, plus any accrued interest and
amortized  discount.


7.     CONTINGENCIES

     From  time  to  time,  various  lawsuits  arise out of the normal course of
business.  These  proceedings  are  handled  by  outside  counsel.  Currently
management  is not aware of any claim or action pending against the Company that
would  have  a  material  adverse  effect on the Company's financial position or
results  of  operations.

     The  Company  has  received  two  grants  from  the  State of Wisconsin for
research  and development of certain products.  The grants are to be repaid only
upon  successful  completion and marketing of the related product.  Repayment of
these  grants  is  to be made on a sales by unit basis.  Repayments approximated
$182,000  and  $14,000  in 1999 and 1997, respectively.  One grant was repaid in
full during 1999.  The repayments are charged to expense as the related products
are  sold.  Since  the  second grant did not result in the successful completion
and  marketing  of a product, the Company does not have to repay the grant.  The
Company has been awarded a third grant from the State of Wisconsin for an amount
up to $100,000 which requires repayment of the grant amount plus interest at 8%,
plus  payment  of  a  royalty  in  the  amount of 1% of net sales of the related
product  for  a five-year period, as defined.  No funds have been received under
this  grant  at  June  30,  1999.

     As  of June 30, 1999, the Company accrued a liability of $1,600,000 related
to  certain  legal  proceedings with a former dealer.  In July 1999, the Company
agreed  to  a  $1,600,000  settlement  with  the  dealer.  The Company agreed to

                                       22

<PAGE>
make  a cash payment to the dealer, transfer a portion of the shares the Company
holds in Immtech, issue the dealer 150,000 shares of the Company's common stock,
and  transfer  certain inventory related to telemetry products no longer sold by
the  Company.  The  settlement  agreement  requires  that a broker chosen by the
Company  sell  the  Immtech  and  Company  common stock on behalf of the dealer.


8.     STOCKHOLDERS'  EQUITY

     STOCK  OPTIONS  -  In  December 1992, the Board of Directors approved a new
Employee  Stock  Option  Plan  and Non-Employee Stock Option Plan.  No new stock
options  can  be  granted  under the Employee Stock Option Plan and Non-Employee
Stock  Option  Plan  which  existed prior to the approval of the new plans.  The
Board  of  Directors  has  authorized  in  connection  with  these new plans the
issuance  of 1,720,000 reserved shares of common stock of which 220,750 reserved
shares  of  common  stock  remain  available for future issuance under the stock
option  plans  at June 30, 1999.  The Board of Directors increased the number of
reserved  shares  for     issuance  under  the Plans from 1,220,000 to 1,720,000
during  1999.  The  activity  during 1997, 1998 and 1999 for the above plans are
summarized  as  follows:
<TABLE>
<CAPTION>



                              Number of   Stock Options  Weighted Avg.
                                Shares     Price Range   Exercise Price
<S>                           <C>         <C>            <C>
Outstanding at July 1, 1996.  1,069,420       1.88-8.50            2.45
     Granted . . . . . . . .    250,500       2.50-5.25            2.64
     Cancelled . . . . . . .   (113,500)      2.00-8.50            3.38
     Exercised . . . . . . .   (162,020)      2.00-2.63            2.47
Outstanding at June 30, 1997  1,044,400       1.88-5.25            2.40
     Granted . . . . . . . .     60,000       3.00-3.25            3.13
     Cancelled . . . . . . .   (179,200)      2.00-5.25            2.38
     Exercised . . . . . . .    (85,500)      2.00-2.75            2.27
Outstanding at June 30, 1998    839,700       1.88-3.63            2.50
     Granted . . . . . . . .    993,700       1.50-1.88            1.74
     Cancelled . . . . . . .   (636,800)      1.69-3.00            2.06
     Exercised . . . . . . .     (5,000)           2.06            2.06
Outstanding at June 30, 1999  1,191,600       1.50-3.00            1.83
Exercisable at June 30, 1999    560,600       1.50-3.00            2.02
</TABLE>



     The  following table summarizes information about stock options outstanding
as  of  June  30,  1999:
<TABLE>
<CAPTION>



                                        OPTIONS OUTSTANDING                         Options Exercisable
                                        Weighted Average
                            Shares          Remaining        Weighted           Shares
Range of                  Outstanding      Contractual   Average Exercise    Exercisable     Weighted Average
Exercise Prices        at June 30, 1999     Life-Years        Price        at June 30, 1999   Exercise Price
<S>                   <C>                  <C>           <C>               <C>               <C>
1.50-1.875                        980,700          3.52  $       1.74              210,400           1.90
2.00-3.00                         210,900          1.15          2.28              350,200           2.21
1.50-3.00                       1,191,600          3.10          1.90              560,600           2.02
</TABLE>



                                       23
<PAGE>


     Outstanding  options  have  fixed  terms  and are exercisable over a period
determined by the Compensation Committee of the Company's Board of Directors but
no longer than five years after the date of grant.  A substantial portion of the
options  issued  are  contingent  on  future  services  or  future  events.

     At  June 30, 1999, 1,038,350 shares of common stock were reserved under the
above  plans.

     The  Company  has  adopted  the disclosure-only provisions of SFAS No. 123,
"Accounting  for  Stock-Based  Compensation,"  but applies Accounting Principles
Board  Opinion  No.  25,  "Accounting for Stock Issued to Employees" and related
interpretations  in  accounting  for  its  plans.  If the Company had elected to
recognize  compensation cost for the options granted during the years ended June
30,  1998,1997, and 1996, consistent with the method prescribed by SFAS No. 123,
net loss and net loss per share would have been changed to the pro forma amounts
indicated  below:

<TABLE>
<CAPTION>


                                                      YEARS ENDED JUNE 30,
                                                 1999              1998         1997
<S>                                     <C>                     <C>         <C>
Net loss-as reported . . . . . . . . .  $          (4,388,171)  $(499,276)  $(2,179,489)
Net loss-pro forma . . . . . . . . . .  $          (4,538,172)  $(779,276)  $(2,325,795)
Net loss per common share-as reported.  $                (.51)  $    (.06)  $      (.30)
Net loss per common share-pro forma. .  $                (.53)  $    (.09)  $      (.32)
Assumptions used:
     Expected volatility . . . . . . .                     15%         14%           58%
     Risk-free interest rate . . . . .                      5%          5%            6%
     Expected option life (in years) .                      3           3             3
</TABLE>




     The  fair value of stock options used to compute pro forma net loss and net
loss per common share is the estimated present value at the grant date using the
Black-Scholes  option-pricing  model.

     In  March 1999, the Company granted 120,000 stock options to a non-employee
at  a  price  of  $2.50  per  share.  The  options  vest  if certain performance
parameters  are  achieved by May 2000.  No such parameters were achieved by June
30,  1999.

     STOCK  WARRANTS  -  In  September  1995,  the  Company  executed  a warrant
agreement with a consultant.  The warrant agreement provided for the issuance of
warrants  to  purchase  up to 150,000 shares of the common stock of the Company,
exercisable  at  a  price of $2.00 per share.  The warrant was exercisable as to
37,500  shares  upon execution of the agreement and the warrants to purchase the
remaining  112,500  shares  were  to  become  exercisable

                                       24
<PAGE>
if  certain  performance  parameters  were  achieved  by  September  1996.  Such
parameters  were  not  met  as of such date.  In January 1997, the agreement was
extended  and the parameters were changed.  During the year ended June 30, 1997,
the  Company  recognized $84,375 of expense related to the value of the services
performed  by  the  consultant  under the extended agreement.  By June 30, 1997,
warrants  to purchase the remaining 112,500 shares of common stock at a price of
$2.00  per  share  became  exercisable.  The warrant holder exercised rights and
purchased 41,000 and 90,000 shares of common stock at $2.00 per share during the
years  ended  June  30,  1998  and  1997.  Warrants to purchase 15,000 shares of
common  stock  at  $2.00  per  share were exercisable as of June 30, 1999.  Such
warrants  expire  in  September  2000.

     In February 1998, the Company executed a similar warrant agreement with the
consultant.  The  warrant  agreement  provides  for  the issuance of warrants to
purchase  up  to  150,000  shares of common stock at a price of $3.00 per share.
The  warrant  is exercisable as to 30,000 shares upon execution of the agreement
and the warrants to purchase the remaining 120,000 shares will be exercisable if
certain  performance  parameters  are  achieved  by  February  1999.  No  such
parameters  were  achieved.  During  the  year  ended June 30, 1998, the Company
recognized  $23,065  of  expense  related to the value of the services performed
under  the  agreement.  As  of  June 30, 1999, 30,000 warrants were exercisable.
Such  warrants  expire  in  February  2003.

     COMMITMENT  TO  ISSUE  SHARES  OF COMMON STOCK - In April 1998, the Company
agreed  to and accepted the patent rights assigned to them by a third party with
respect  to certain technology related to the transmission of clinical data.  In
consideration  for the patent, the Company has agreed to provide the third party
with  400,000  shares  of common stock payable over a four-year time period with
additional consideration of up to 112,000 shares contingent upon the achievement
of  certain  sales  levels.  The  Company  recorded  a  charge  to operations of
$900,000  in  fiscal 1998 with respect to the value of the in-process technology
which  was expensed as research and development costs.  During 1999, the Company
renegotiated  the agreement and issued the third party 350,000 shares instead of
the  400,000  shares  payable over four years and the 112,000 contingent shares.
The  400,000 shares to have been issued were considered to be outstanding shares
for  purposes of computing basic and diluted income (loss) per common share from
April  1998  until  the  350,000  shares  were  issued  in  November  1998.

     PREFERRED  STOCK  -  The  Company's Board of Directors has the authority to
determine  the  relative  rights  and preferences of any series it may establish
with  respect  to  the  500,000  shares  of  $.04 par value authorized preferred
shares.  No  preferred  stock  is  issued  or  outstanding.


                                       25
<PAGE>
     On  March  27,  1997,  the  Board  of  Directors  of the Company declared a
dividend  of one preferred share purchase right (a "Right") for each outstanding
share  of  common stock of the Company.  The dividend was made on April 24, 1997
to  the  stockholders  of  record  on  that  date  to  purchase  Preferred Stock
("Preferred")  upon  the  occurrence  of  certain  events.  The  Rights  will be
exercisable  the  tenth business day after a person or group acquires 20% of the
Company's  common  stock,  or  makes  an  offer  to  acquire  30% or more of the
Company's  common  stock.  When  exercisable,  each right entitles the holder to
purchase  for  $25, subject to adjustment, one-hundredth of a share of Preferred
for  each share of common stock owned.  Each share of Preferred will be entitled
to a minimum preferential quarterly dividend of $25 per share, but not less than
an  aggregate  dividend of 100 times the common stock dividend.  Each share will
have  100  votes,  voting  together  with the common stock.  In the event of any
merger, each share of Preferred will be entitled to receive 100 times the amount
received  per  share  of  common  stock.  The  Rights  expire  on April 1, 2007.

9.     EMPLOYEE  BENEFIT  PLAN
     The  Company  has  a  401(k) plan which covers substantially all employees.
Company  contributions  to the plan are discretionary and determined annually by
the  Company's  Board  of  Directors.  The  Company's  contributions  were
approximately  $84,000,  $77,000,  and  $81,000  in  1999,  1998  and  1997,
respectively.

10.     BUSINESS  AND  CREDIT  CONCENTRATIONS
     The  Company  operates in one business segment-the manufacturing of medical
monitoring  and  telemetry equipment.  The Company's customers include hospitals
and  alternative health care sites throughout the world.  Although the Company's
products  are  sold primarily to health care providers, concentrations of credit
risk  with respect to trade accounts receivable are limited due to the Company's
large  number  of  customers  and  their  geographic dispersion.  During 1999, a
customer,  who  has  entered  into  an OEM agreement with the Company, purchased
approximately  $4,360,000  of  the  Company's  products.  This  represents
approximately  15%  of  the  Company's  total  sales.  The  Company  currently
coordinates  substantially  all international sales and distribution activities.
Such  activities  were previously provided by the Company with the assistance of
Criticare  International.  Identifiable  assets

                                       26
<PAGE>
located  outside  of  the  United  States  are  insignificant in relation to the
Company's  total  assets.  Net  export  sales by geographic area are as follows:
<TABLE>
<CAPTION>



                                         1999         1998         1997
<S>                                   <C>          <C>          <C>
Europe and Middle East . . . . . . .  $ 4,635,000  $ 5,464,000  $ 5,606,000
Pacific Rim. . . . . . . . . . . . .    2,243,000    3,895,000    3,784,000
Canada and Central and South America    3,634,000    3,414,000    3,867,000
Net export sales . . . . . . . . . .  $10,512,000  $12,773,000  $13,257,000
</TABLE>



11.     SEVERANCE  PAY
     During  November  1999,  the  two  co-founders of the Company resigned from
their  positions.  The  Company  has  provided  each of these individuals with a
severance agreement which includes a portion of their salary and fringe benefits
for  a  period  which approximates three years and recorded a charge of $810,000
for  their  severance  in  the  year  ended  June  30,  1999.


                                       27
<PAGE>

QUARTERLY  RESULTS

The  following  table  contains  quarterly  information,  which  includes  all
adjustments,  consisting  only of normal recurring adjustments, that the Company
considers  necessary  for a fair presentation.  The Company recorded a charge of
approximately  $1,800,000  for  settlement  costs  related to a lawsuit that was
substantially  resolved  in  the  quarter  ended  June  30, 1999 and a charge of
$900,000  for  the purchase of patented technology in the quarter ended June 30,
1998.  These  items  were  unusual,  nonrecurring  adjustments.  The  quarterly
results  for the quarters ended September 30, 1998, December 31, 1998, March 31,
1999  and  June  30,  1999  are derived from financial statements of the Company
which  have  not  been  audited.
<TABLE>
<CAPTION>



Quarters Ended
                          Sept. 30,     Dec. 31,   March 31,    June 30,    Sept. 30,    Dec. 31,    March 31,    June 30,
                            1997          1997        1998        1998        1998         1998        1999         1999
                                                         (in thousands, except per share data)
<S>                    <C>              <C>        <C>         <C>         <C>          <C>         <C>          <C>
Net sales . . . . . .  $         7,544  $   7,138  $    6,279  $   6,947   $    6,724   $   7,290   $    7,276   $   7,223
Gross profit. . . . .            3,506      3,273       2,919      3,340        3,259       3,562        3,379       2,784
Income (loss) from
  operations. . . . .              586        422          70       (772)        (214)       (880)        (486)     (2,308)
Net income (loss) . .              172        132          19       (822)        (420)       (947)        (681)     (2,340)
Net income (loss)
   per common
   share-Basic. . . .              .02        .02         .00       (.10)        (.05)       (.11)        (.08)       (.27)
            -Diluted.              .02        .02         .00       (.10)        (.05)       (.11)        (.08)       (.27)

</TABLE>
The  Company  typically  receives  a  substantial  volume of its quarterly sales
orders  at  or  near  the  end of each quarter.  In anticipation of meeting this
expected  demand, the Company usually builds a significant inventory of finished
products throughout each quarter.  If the expected volume of sales orders is not
received  during  the  quarter,  or is received too late to allow the Company to
ship  the  products  ordered during the quarter, the Company's quarterly results
and  stock  of  finished  inventory  can  be  significantly  affected.

                                       28
<PAGE>
                                    PART III
                                    --------

ITEM  10.     DIRECTORS  AND  EXECUTIVE  OFFICERS  OF  THE  REGISTRANT

DIRECTORS  AND  EXECUTIVE  OFFICERS

     The  directors  and  executive  officers  of  the  Company  are as follows:
<TABLE>
<CAPTION>



NAME                               AGE                      POSITION
----------------------------  -------------  --------------------------------------
<S>                           <C>            <C>
Emil H. Soika. . . . . . . .        61       President, Chief Executive Officer and
                                             Director
Joseph M. Siekierski . . . .        34       Vice President - Finance and Secretary
Stephen D. Okland. . . . . .        57       Vice President - Domestic Sales
Drew M Diaz. . . . . . . . .        36       Vice President - International Sales
Michael T. Larsen. . . . . .        40       Vice President - Quality
                                             Control/Quality Assurance
Gloria Najera. . . . . . . .        50       Vice President - Operations
Karsten Houm . . . . . . . .        53       Chairman and Director
Gerhard J. Von der Ruhr. . .        58       Director
N.C. Joseph Lai. . . . . . .        57       Director
Milton Datsopoulos . . . . .        59       Director
</TABLE>



     Emil  H.  Soika  has  served  as  President,  Chief Executive Officer and a
Director  of  the  Company since November 1998.  From November 1995 to September
1998,  Mr.  Soika  served  as  Vice  President  and General Manager of Spacelabs
Medical,  a  medical  monitoring and clinical information systems company.  From
March  1991  to  July  1998,  Mr.  Soika served as President and Chief Executive
Officer  of  Block Medical, a manufacturer of intravenous dispensers.  Mr. Soika
is  a director of Immtech International, Inc., a company engaged in the research
and  development  of  products  in  the  fields  of biochemistry and immunology.

     Joseph  M.  Siekierski  joined  the  Company  as Vice President-Finance and
Assistant  Secretary in October 1997.  Mr. Siekierski was appointed as Secretary
of  the  Company in November 1998.  Prior to joining the Company, Mr. Siekierski
was  Controller  for  Modern Building Materials, Inc., a manufacturer of precast
concrete  products,  from  1996  to 1997.  From 1993 to 1996, Mr. Siekierski was
Controller  for  the  Company.

     Stephen  D.  Okland has served as a Vice President of the Company since May
1988.

     Drew  M.  Diaz  served the Company as Regional Sales Manager for the Middle
East  and  Western  Europe  from  1993  until  he  was  appointed  Director  of
International  Sales  in  1995.  Mr.  Diaz  was  most  recently promoted to Vice
President-International Sales in 1997.  From October 1996 until August 1997, Mr.
Diaz  also served as Geschaeftsfuehrer of Criticare International GmbH Marketing
Services,  a  wholly-owned

                                       29

<PAGE>
subsidiary  of  the  Company  which  was  dissolved in 1998 following bankruptcy
proceedings  under  German  law.

     Michael  T.  Larsen  has  served  as Vice President-Quality Control/Quality
Assurance  since  September  1990.

     Gloria  Najera  joined  the  Company  as Vice President-Operations in March
1997.  Prior  to  rejoining  the  Company,  Ms.  Najera was Director of Consumer
Services  and  Distribution  from  July  1994  to  March  1997 for the Milwaukee
Journal-Sentinel,  a  newspaper  publisher.  From  1988  to 1994, Ms. Najera was
Consumer  Services  Director  of  the  Company.

     Karsten  Houm  has  served  as  Chairman  of the Board of the Company since
November  1998  and  as  a  Director  of  the Company since 1985.  Mr. Houm also
currently  works  as  a management consultant.  From September 1985 to 1997, Mr.
Houm  served  as  President  of  Unitor,  a  Norwegian  shipping  company.

     Gerhard J. Von der Ruhr has served as a Director of the Company since 1984.
Mr.  Von  der  Ruhr  is  Chairman of O.B. Scientific, Inc., a medical technology
company.  Mr. Von der Ruhr is a co-founder of the Company and served as Chairman
of  the  Company's  Board,  President  (CEO)  and  Treasurer  from the Company's
inception  in  October  1984  until  November  1998.

     N.C. Joseph Lai, Ph.D., has served as a Director of the Company since 1984.
Dr.  Lai is a management consultant.  Dr. Lai is a co-founder of the Company and
served  as  Vice  Chairman  of  its  Board  and as an officer from the Company's
inception  in  October  1984  until  November  1998.

     Milton Datsopoulos has served as a Director of the Company since 1986.  Mr.
Datsopoulos  has been a partner in the law firm of Datsopoulos, MacDonald & Lind
in  Missoula,  Montana  since  1974.  Mr.  Datsopoulos  is a director of Montana
Naturals  Int'l,  Inc.,  a manufacturer of natural food products and nutritional
supplements,  Kafus  Environmental  Industries  Ltd., a producer of consumer and
industrial waste recycling technology, and Leigh Resource Corporation, a company
engaged  in  mineral  exploration  and  development.

SECTION  16(A)  BENEFICIAL  OWNERSHIP  REPORTING  COMPLIANCE

     Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers  and directors, and persons who own more than 10% of a registered class
of  the Company's equity securities, to file reports of ownership and changes in
ownership  with the Securities and Exchange Commission ("SEC") on Form 3, 4, and
5.  Officers,  directors  and  greater than 10% stockholders are required by SEC
regulation to furnish the Company with copies of all Forms 3, 4 and 5 they file.

     Based  solely  on  review  of  the  copies  of  such forms furnished to the
Company,  or  written representations that no Forms 5 were required, the Company
believes  that  during  fiscal  1999  all  section  16(a)  filing  requirements
applicable  to  its  officers,  directors  and

                                       30

<PAGE>
greater  than  10%  beneficial  owners  were  complied with, except that Emil H.
Soika, Joseph M. Siekierski, Stephen D. Okland, Drew M. Diaz, Michael T. Larsen,
Gloria Najera, Karsten Houm and Milton Datsopoulos each did not file a Form 4 or
Form  5  to  report  option  grants  during  fiscal  1999.

ITEM  11.     EXECUTIVE  COMPENSATION

SUMMARY  COMPENSATION  INFORMATION

     The  following  table  sets  forth  information  with  respect  to  all
compensation,  including  stock options granted and all cash bonuses and accrued
deferred  compensation,  incurred  by  the Company during the three fiscal years
ended  June  30,  1999  to  or  on behalf of the two persons who served as Chief
Executive Officer during fiscal 1999 and the two other executive officers of the
Company  whose  salary  exceeded  $100,000  for fiscal 1999.  The persons listed
below  are  sometimes  referred  to  herein  as  the "named executive officers."
<TABLE>
<CAPTION>



                                                SUMMARY COMPENSATION TABLE

                                                                            LONG-TERM
                                           ANNUAL COMPENSATION             COMPENSATION
                                           --------------------            -------------
                                                                             AWARDS:
                                                                           SECURITIES
NAME AND                                                OTHER ANNUAL       UNDERLYING        ALL OTHER
PRINCIPAL POSITION           YEAR        SALARY($)   COMPENSATION($) (1)  OPTIONS/SARS (#)  COMPENSATION($)
---------------------------  -----    -------------  -------------------  ----------------  ---------------
<S>                          <C>      <C>            <C>                  <C>               <C>
Emil H. Soika,                1999         78,125                    --          200,000               --
  President and Chief
  Executive Officer (2)

Gerhard J. Von d              1999         60,000                 1,915               --       593,646 (4)
  Chairman of the Board,      1998        144,000                   958               --        56,838 (4)
  President (CEO) and         1997        144,000                   957               --        56,620 (4)
  Treasurer (3)

Stephen D. Okland,            1999     277,576 (5)                6,000        43,500 (6)        3,701 (7)
  Vice President-Domestic     1998     302,628 (5)                6,000               --         3,690 (7)
  Sales                       1997     253,706 (5)                6,000           10,000         3,441 (7)

Drew M. Diaz,                 1999        165,609                 1,915       100,000 (8)        1,822 (9)
  Vice President-             1998        188,292                   638               --            86 (9)
  International Sales         1997        180,717                 8,223           50,000         3,226 (9)

_____________________
<FN>


(1)     The  amounts  represent  automobile  allowance  payments.

                                       31

<PAGE>

(2)     Mr.  Soika  commenced  employment  with  the  Company  in November 1998.

(3)     Mr.  Von der Ruhr resigned as Chairman of the Board, President (CEO) and
Treasurer  of  the  Company  in  November  1998.

(4)     For  fiscal  1999, represents $50,396 of premiums paid by the Company on
two  life  insurance  policies,  the  proceeds  of  which  are  payable  to  the
beneficiary  of  Mr. Von der Ruhr, $2,760 of Company contributions to the 401(k)
plan  on  behalf of Mr. Von der Ruhr and $540,490 paid or accrued for severance.
For  fiscal 1998, represents $53,638 of premiums paid by the Company on two life
insurance  policies, the proceeds of which are payable to the beneficiary of Mr.
Von  der  Ruhr, and $3,200 of Company contributions to the 401(k) plan on behalf
of  Mr.  Von  der Ruhr.  For fiscal 1997, represents $53,620 of premiums paid by
the Company on two life insurance policies, the proceeds of which are payable to
the  beneficiary of Mr. Von der Ruhr, and $3,000 of Company contributions to the
401(k)  plan  on  behalf  of  Mr.  Von  der  Ruhr.

(5)     Represents  commissions  paid  by  the  Company to Mr. Okland based on a
percentage  of  certain  domestic  sales by the Company.  Mr. Okland receives no
fixed  salary.

(6)     Represents  30,000 stock options granted in fiscal 1999 and 13,500 stock
options  regranted  due  to  repricing  of  options  on  December  11,  1998.

(7)     For  fiscal  1999,  represents $501 of premiums paid by the Company on a
life  insurance  policy, the proceeds of which are payable to the beneficiary of
Mr.  Okland, and $3,200 of Company contributions to the 401(k) plan on behalf of
Mr. Okland.  For fiscal 1998, represents $490 of premiums paid by the Company on
a life insurance policy, the proceeds of which are payable to the beneficiary of
Mr.  Okland, and $3,200 of Company contributions to the 401(k) plan on behalf of
Mr. Okland.  For fiscal 1997, represents $441 of premiums paid by the Company on
a life insurance policy, the proceeds of which are payable to the beneficiary of
Mr.  Okland, and $3,000 of Company contributions to the 401(k) plan on behalf of
Mr.  Okland.

(8)     Represents  34,000 stock options granted in fiscal 1999 and 66,000 stock
options  regranted  due  to  repricing  of  options  on  December  11,  1998.

(9)     For  fiscal  1999,  represents $101 of premiums paid by the Company on a
life  insurance  policy, the proceeds of which are payable to the beneficiary of
Mr.  Diaz,  and  $1,781 of Company contributions to the 401(k) plan on behalf of
Mr.  Diaz.  For fiscal 1998, represents $86 of premiums paid by the Company on a
life  insurance  policy, the proceeds of which are payable to the beneficiary of
Mr. Diaz.  For fiscal 1997, represents $3,226 of premiums paid by the Company on
a  health insurance policy while Mr. Diaz was a resident of Europe, the proceeds
of  which  are  payable  to  the  beneficiary  of  Mr.  Diaz.

</TABLE>

COMPENSATION  OF  DIRECTORS

     Directors of the Company are reimbursed for out-of-pocket expenses incurred
in  attending  meetings  of  the  Board of Directors.  Directors receive no cash
directors'  fees.  In addition to the stock options granted to Mr. Soika, listed
above,  during  fiscal 1999, the Company granted 22,500 stock options to each of
Mr.  Houm and Mr. Datsopoulos, and regranted 77,500 stock options to each of Mr.
Houm  and Mr. Datsopoulos through the repricing of options on December 11, 1998.

EMPLOYMENT  AGREEMENTS  AND  SEVERANCE  ARRANGEMENTS

     On  June  1, 1999, the Company entered into employment agreements with Emil
H.  Soika,  President  and  Chief  Executive  Officer,  Stephen  D. Okland, Vice
President-Domestic  Sales, and Drew M. Diaz, Vice President-International Sales.
Mr.  Soika's  employment  agreement  provides  for a base salary of $125,000 per
year.  The  employment  agreements  for  Mr. Okland and Mr. Diaz provide for the
continuation  of their respective current compensation, with an annual review of
the  compensation  within  30  days  prior  to  the  end


                                       32

<PAGE>
of  each  fiscal year.  Mr. Soika's employment agreement provides that Mr. Soika
is  eligible  to  participate in a cash bonus program and is entitled to receive
health  and  life insurance coverage and disability insurance.  Mr. Okland's and
Mr. Diaz's employment agreements provide that each is entitled to receive health
and life insurance coverage and disability insurance.  The Company may terminate
Mr.  Soika's,  Mr.  Okland's or Mr. Diaz's respective employment at any time and
any of Mr. Soika, Mr. Okland or Mr. Diaz may resign at any time.  If the Company
terminates  employment  without  cause  at  any  time either prior to or after a
change  in  control  of the Company, Mr. Soika is entitled to receive payment of
his base salary and to continue to receive other employee benefits for 12 months
from  the  date  of  termination;  Mr.  Okland is entitled to receive payment of
$18,750  per  month  and  to  continue to receive other employee benefits for 24
months from the date of termination; and Mr. Diaz is entitled to receive payment
of  his  then  current  compensation  and  to continue to receive other employee
benefits  for  12  months  from  the  date  of termination.  If Mr. Soika's, Mr.
Okland's  or  Mr.  Diaz's employment is terminated for any other reason before a
change  in  control of the Company, the terminated employee will not be entitled
to  receive  any base salary or other benefits for periods after the termination
date.  If the Company experiences a change in control, and Mr. Soika voluntarily
terminates  his  employment  for  any  reason  after  completing three months of
employment  after  the date of the change in control, Mr. Soika will be entitled
to  receive payment of his base salary and to continue to receive other employee
benefits for 12 months after the date of termination, or until Mr. Soika secures
alternative employment, whichever period is shorter.  If the Company experiences
a  change  in  control,  and  Mr.  Okland  or  Mr.  Diaz  voluntarily terminates
employment  for any reason after completing three months of employment after the
date of the change in control, Mr. Okland will be entitled to receive payment of
$1,8750  per  month  and  to  continue to receive other employee benefits for 24
months  after  the  date of termination, or until Mr. Okland secures alternative
employment,  whichever  period  is  shorter,  and  Mr.  Diaz will be entitled to
receive  payment  of  his  then  current compensation and to continue to receive
other  employee  benefits  for 12 months after the date of termination, or until
Mr.  Diaz  secures  alternative  employment,  whichever  period is shorter.  Mr.
Soika,  Mr. Okland and Mr. Diaz have each agreed not to compete with the Company
during  employment  and  for  Mr.  Soika, for a period of three months after any
voluntary  termination  of  employment by Mr. Soika or for a period of 12 months
after any termination by the Company without cause; for Mr. Okland, for a period
of  24 months after any voluntary termination of employment by Mr. Okland or for
a  period  of  24 months after any termination by the Company without cause; and
for  Mr.  Diaz,  for  a  period  of 12 months after any voluntary termination of
employment by Mr. Diaz or for a period of 12 months after any termination by the
Company  without  cause.  Mr. Soika, Mr. Okland and Mr. Diaz have each agreed to
maintain  the  confidentiality  of  the Company's financial statements and other
financial  information.

     On  November  16, 1998, the Company entered into a severance agreement with
Gerhard  J.  Von der Ruhr, the Company's former Chairman of the Board, President
(CEO)  and  Treasurer.  Pursuant  to  this  severance  agreement, the Company is
required  to  make  payments to Mr. Von der Ruhr of $6,000 per month over the 36
months from December 1998 through November 2001.  The Company also agreed to (i)
issue  options  to  purchase  up to 21,000 shares of Common Stock to Mr. Von der
Ruhr with an exercise price of $2.0625 per share, (ii) allow Mr. Von der Ruhr to
continue  to  use  office  space


                                       33


<PAGE>
and  secretarial  services  for  a  period of up to 12 months, (iii) continue to
provide fringe benefits to Mr. Von der Ruhr through September 30, 2001, and (iv)
continue to provide health benefits to Mr. Von der Ruhr and his spouse until the
earlier  of  the  date  Mr. Von der Ruhr reaches age 65 or he obtains comparable
insurance  coverage  from  a  subsequent  employer.  Pursuant  to this severance
agreement,  the  Company  also transferred patent and technology rights that the
Company  had  received  from Immtech International, Inc. ("Immtech") relating to
treatment  for sepsis and prophylaxis and 172,414 shares of Immtech common stock
to  a  new  company  ("Newco")  formed  by  Mr. Von der Ruhr in exchange for the
payment  by  Newco  of  $150,000 in ten semi-annual installments of $15,000 each
starting on June 1, 1999.  The Company received 10% of the outstanding shares of
Newco and the right to elect one member of the board of directors of Newco.  The
Company  and  Mr.  Von  der Ruhr also agreed to certain provisions regarding the
distribution of products related to the technology transferred by the Company to
Newco.

     On  November  16, 1998, the Company also entered into a severance agreement
with  N.C.  Joseph  Lai, Ph.D., the Company's former Senior Vice President, Vice
Chairman  of the Board and Secretary.  Pursuant to this severance agreement, the
Company  is required to make payments to Dr. Lai of $5,000 per month over the 36
months from December 1998 through November 2001.  The Company also agreed to (i)
issue options to purchase up to 21,000 shares of Common Stock to Dr. Lai with an
exercise  price  of  $2.0625  per  share,  (ii) allow Dr. Lai to continue to use
office  space  and  secretarial  services for a period of up to 12 months, (iii)
continue  to  provide fringe benefits to Dr. Lai through September 30, 2001, and
(iv)  continue  to  provide  health benefits to Dr. Lai and his spouse until the
earlier  of  the  date Dr. Lai reaches age 65 or he obtains comparable insurance
coverage  from  a  subsequent  employer.


                                       34

<PAGE>
STOCK  OPTIONS

     The  following  table  provides certain information regarding stock options
granted  to  the  named executive officers of the Company during the fiscal year
ended  June  30,  1999.

<TABLE>
<CAPTION>
                                            OPTION GRANTS IN LAST FISCAL YEAR

                           NUMBER OF     % OF TOTAL                                            POTENTIAL REALIZABLE VALUE
                          SECURITIES    OPTIONS/SARS                                           AT ASSUMED ANNUAL RATES OF
                          UNDERLYING     GRANTED TO            EXERCISE                         STOCK PRICE APPRECIATION
                         OPTIONS/SARS   EMPLOYEES IN            PRICE              EXPIRATION     FOR OPTION TERM ($)
NAME                      GRANTED (#)   FISCAL YEAR             ($/ SH)               DATE         5%             10%
-----------------------  -------------  ------------  ---------------------------  ----------  -----------    ----------
<S>                      <C>            <C>           <C>                           <C>         <C>           <C>
Emil H. Soika . . . . .  100,000                9.0             1.6875               2/23/04      46,623       103,024
                         100,000                9.0             1.5000               3/10/04      41,442        91,577
Gerhard J. Von der Ruhr       --                 --                 --                    --          --            --
Stephen D. Okland . . .   30,000                2.7             1.8750              12/11/03      15,541        34,341
                          10,000                0.9             1.8750              10/08/00       5,180        11,447
                           3,500                0.3             1.8750              12/31/01       2,672         6,226
Drew M. Diaz. . . . . .   34,000                3.1             1.5000               3/10/04      14,090        31,136
                           2,000                0.2             1.8750               1/25/00       1,527         3,558
                           4,000                0.4             1.8750              12/31/01       3,053         7,115
                          10,000                0.9             1.8750              10/08/00       5,180        11,447
                          50,000                4.5             1.8750               1/23/02      25,901        57,235
</TABLE>



     The following table shows the fiscal year-end value of unexercised options
held  by  the  named  executive  officers.  None of the named executive officers
exercised  options  in  fiscal  1999.

                         FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>



                         NUMBER OF SECURITIES UNDERLYING         VALUE OF UNEXERCISED
                              UNEXERCISED OPTIONS AT                 IN-THE-MONEY
                                FISCAL YEAR-END(#)         OPTIONS AT FISCAL YEAR END($) (1)
                         --------------------------------  ---------------------------------

NAME                     EXERCISABLE      UNEXERCISABLE    EXERCISABLE      UNEXERCISABLE
-----------------------  -----------      -------------    -----------      -------------
<S>                      <C>              <C>              <C>              <C>
Emil H. Soika                    --            200,000              --             93,750
Gerhard J. Von der Ruhr          --                 --              --                 --
Stephen D. Okland            13,500             30,000           2,531              5,625
Drew M. Diaz                 22,000             78,000           4,125             27,375
<FN>

(1)     Based  on  the  reported  closing  bid  price  of  $2.0625  per  share  of  common  stock  on  June  30,  1999.
</TABLE>




                                       35

<PAGE>
RETIREMENT  PLAN

     Effective  April  1, 1991, the Company adopted a 401(k) plan, which covers
substantially  all  employees  who have completed one year of employment.  Under
the  plan,  eligible  employees can contribute up to 15% of pre-tax compensation
for investment in a trust under the plan.  Company contributions to the plan are
discretionary  and  determined  annually  by  the  Board of Directors.  Employee
contributions, within certain limitations, are considered tax deferred under the
provisions  of  section 401(k) of the Internal Revenue Code.  Withdrawals of tax
deferred  amounts  may  be made upon termination of employment or earlier in the
event  of certain defined hardship situations. Contributions made or accrued for
named  executive officers are included under the "All Other Compensation" column
in  the  Summary  Compensation  Table.

     Other  than  the  401(k)  plan, the Company does not maintain any pension,
profit  sharing,  retirement  or  similar  plans.


ITEM  12.     SECURITY  OWNERSHIP  OF  CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     The  following  table  sets  forth  information with respect to beneficial
ownership  of the Common Stock as of August 31, 1999 by (a) each person known to
the  Company  to  own  beneficially  more  than 5% of the Common Stock, (b) each
director of the Company, (c) each named executive officer, and (d) all directors
and  executive  officers  as  a  group:

<TABLE>
<CAPTION>



NAME AND ADDRESS OF                                             NUMBER OF
BENEFICIAL OWNER (1)                                          SHARES OWNED   PERCENT
------------------------------------------------------------  -------------  --------
<S>                                                           <C>            <C>
Emil H. Soika                                                           --        --
Gerhard J. Von der Ruhr                                         560,275 (2)      6.4%
N.C. Joseph Lai                                                 713,894 (3)      8.2
Karsten Houm                                                    103,365 (4)      1.2
Milton Datsopoulos                                               77,500 (5)        *
Stephen D. Okland                                                17,000 (6)        *
Drew M. Diaz                                                     35,500 (7)        *
All directors and executive officers as a group (10 persons)  1,639,634 (8)     18.8

_____________________
<FN>


*     Less  than  1%

(1)     Unless  otherwise  indicated,  the  address of the beneficial owner is 20925
Crossroads Circle, Waukesha, WI 53186; the address of Mr. Houm is Kristinelundvn. 21,
0268 Oslo, Norway; and the address of Mr. Datsopoulos is Central Square Building, 201
West  Main,  Missoula,  Montana  59802.


                                       36

<PAGE>
(2)     Includes  410,000 shares owned of record by Ursula Von der Ruhr, Mr. Von der
Ruhr's  wife,  and  1,175  shares  owned  of record by Mark Von der Ruhr, Mr. Von der
Ruhr's  son.

(3)     Includes  116,000  shares  owned  of  record  by  Helen Lai, Dr. Lai's wife;
137,000 shares owned jointly by Dr. Lai and his wife; 184,000 shares in the aggregate
owned of record by Dr. Lai's sons, Christopher Lai and Thomas Lai; and 134,000 shares
owned  of  record  by  the  Lai  Family  Foundation.

(4)     Includes  87,500  shares  which  Mr.  Houm  has  the  right to acquire under
currently  exercisable  options.

(5)     Includes  77,500 shares which Mr. Datsopoulos has the right to acquire under
currently  exercisable  options.

(6)     Includes  13,500  shares  which  Mr.  Okland  has the right to acquire under
currently  exercisable  options.

(7)     Includes  34,000  shares  which  Mr.  Diaz  has  the  right to acquire under
currently  exercisable  options.

(8)     Includes  287,500  shares  of  Common  Stock the members of the group have a
right  to  acquire  under  currently  exercisable  options.
</TABLE>

ITEM  13.     CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS

     Not  applicable.


                                     PART IV
                                     -------

Item  14.     EXHIBITS,  FINANCIAL  STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.
--------      -----------------------------------------------------------------

(a)     The  following  documents  are  filed  as  part  of  this  report:

     1.     Financial  Statements.  The  following  consolidated  financial
            ---------------------
statements  of  the  Company  are  included  in  Item  8  of  this  report.

          Consolidated  Balance  Sheets  -  as  of  June  30,  1999  and  1998.

          Consolidated  Statements  of Operations - for the years ended June 30,
1999,  1998  and  1997.

          Consolidated  Statements of Stockholders' Equity - for the years ended
June  30,  1999,  1998  and  1997.

          Consolidated  Statements  of Cash Flows - for the years ended June 30,
1999,  1998  and  1997.

          Notes  to  consolidated  financial  statements.

                                       37

<PAGE>
     2.     Financial  Statement  Schedules:
            -------------------------------

          The  financial  statement  schedule  referenced  below  has  not  been
audited.

          Financial  Statement Schedule for the years ending June 30, 1999, 1998
and  1997:

Schedule
Number     Description               Page
------     -----------               ----

VIII     Valuation  and  Qualifying          21
     Accounts  and  Reserves

     All  other  schedules  for  which  provision  is  made  in  the  applicable
accounting  regulations  of  the  Securities  and  Exchange  Commission  are not
required  under  the  related  instructions,  are  inapplicable  or the required
information is shown in the financial statements or notes thereto, and therefore
have  been  omitted.

     3.     Exhibits:
            --------

          3.1     Restated  Certificate  of  Incorporation  of  the  Company
(incorporated  by  reference  to  the  Registration  Statement  on  Form  S-1,
Registration  No.  33-13050).

          3.2     By-Laws  of  the  Company  (incorporated  by  reference to the
Registration  Statement  filed  on  Form  S-1,  Registration  No.  33-13050).

          4.1     Specimen  Common  Stock certificate (incorporated by reference
to  the  Registration  Statement  filed on Form S-1, Registration No. 33-13050).

          10.1     Blatz  House  Offices  Limited  Partnership  Agreement
(incorporated  by  reference  to the Company's Quarterly Report on Form 10-Q for
the  quarter  ended  December  31,  1987).

          10.2     Rights  Agreement (incorporated by reference to the Company's
Current  Report  on  Form  8-K  filed  on  April  18,  1997).

          10.3     Assignment  of  Rights to Patent Applications, Patents and/or
Inventions,  effective  November  3,  1998,  between  the  Company  and  TeleMed
Technologies  International,  Inc.  (incorporated  by  reference  to  the

                                       38

<PAGE>
Company's  Quarterly  Report on Form 10-Q for the quarter ended March 31, 1999).


          10.4     Registration Agreement, dated as of November 3, 1998, between
the  Company  and  TeleMed  Technologies  International,  Inc.  (incorporated by
reference  to  the Company's Quarterly Report on Form 10-Q for the quarter ended
March  31,  1999).

          10.5*+     1999  Employee  Stock  Purchase  Plan.

          10.6*     1992  Employee  Stock Option Plan (incorporated by reference
to the Company's Registration Statement on Form S-8, Registration No. 33-60644).

          10.7*     1992  Nonemployee  Stock  Option  Plan  (incorporated  by
reference  to the Company's Registration Statement on Form S-8, Registration No.
33-60214).

          10.8*     1987  Employee  Stock Option Plan (incorporated by reference
to the Company's Registration Statement on Form S-8, Registration No. 33-33497).

          10.9*     1987  Nonemployee  Stock  Option  Plan  (incorporated  by
reference  to the Company's Registration Statement on Form S-8, Registration No.
33-40038).

          10.10*     Form  of Executive Officer and Director Indemnity Agreement
(incorporated  by reference to the Company's Registration Statement on Form S-1,
Registration  No.  33-13050).

          10.11*     Employment  Agreement  of  Gerhard  J.  Von  der  Ruhr
(incorporated  by  reference  to  the  Registration Statement filed on Form S-1,
Registration  No.  33-13050).

          10.12*     Employment  Agreement  of  N.C. Joseph Lai (incorporated by
reference  to  the  Registration  Statement  filed on Form S-1, Registration No.
33-13050).

          10.13*     Amendment  to  Employment  Agreement  of Gerhard J. Von der
Ruhr  (incorporated by reference to the Company's Annual Report on Form 10-K for
the  year  ended  June  30,  1997).

          10.14*     Amendment  to  Employment  Agreement  of  N.C.  Joseph  Lai
(incorporated  by  reference to the Company's Annual Report on Form 10-K for the
year  ended  June  30,  1997).

                                       39

<PAGE>
          10.15*     Severance  Agreement,  dated  as  of  November 16, 1998, of
Gerhard  J.  Von  der Ruhr (incorporated by reference to the Company's Quarterly
Report  on  Form  10-Q  for  the  quarter  ended  March  31,  1999).

          10.16*     Severance Agreement, dated as of November 16, 1998, of N.C.
Joseph  Lai (incorporated by reference to the Company's Quarterly Report on Form
10-Q  for  the  quarter  ended  March  31,  1999).

          10.17*+     Employment  Agreement  of  Emil  H.  Soika.

          10.18*+     Employment  Agreement  of  Joseph  M.  Siekierski.

          10.19*+     Employment  Agreement  of  Stephen  D.  Okland.

          10.20*+     Employment  Agreement  of  Drew  M.  Diaz.

          10.21*+     Employment  Agreement  of  Gloria  Najera.

          10.22*+     Amendment  to  Employment  Agreement  of  Gloria  Najera.

          21+     Subsidiaries.

          24+     Power  of  Attorney.

          27+     Financial  Data  Schedule.
__________________
+  Previously  filed.
*  Management  contract  or  compensatory  plan  or  arrangement.

(b)     Reports  on  Form  8-K.

     The  Company filed no reports on Form 8-K during the quarter ended June 30,
1999.

(c)     Exhibits.

     The  response to this portion of Item 14 is submitted as a separate section
of  this  report.

(d)     Financial  Statement  Schedules.

     The  response to this portion of Item 14 is submitted as a separate section
of  this  report.

                                       40

<PAGE>
                                   SIGNATURES


          Pursuant  to the requirements of Section 13 or 15(d) of the Securities
Exchange  Act  of  1934,  the  registrant has duly caused this Form 10-K/A to be
signed  on  its  behalf  by  the  undersigned,  thereunto  duly  authorized.


                              CRITICARE  SYSTEMS,  INC.

                              By  /s/ Emil  H.  Soika
                                  --------------------------------
                                  Emil  H.  Soika,  President
                                  and  Chief  Executive  Officer

                              Date:  November  3,  1999


          Pursuant  to  the requirements of the Securities Exchange Act of 1934,
this Form 10-K/A has been signed below by the following persons on behalf of the
registrant  and  in  the  capacities  and  on  the  dates  indicated.

<TABLE>
<CAPTION>



Signature                                 Title                        Date
-------------------------  ------------------------------------  ----------------

<S>                        <C>                                   <C>
/s/ Emil H. Soika          President, Chief Executive Officer    November 3, 1999
-------------------------
Emil H. Soika              and Director (Principal Executive
Officer)

/s/ Joseph M. Siekierski   Vice President-Finance and Secretary  November 3, 1999
-------------------------
Joseph M. Siekierski       (Principal Financial and Accounting
                           Officer)

*                          Chairman of the Board and Director    November 3, 1999
-------------------------
Karsten Houm

*                          Director                              November 3, 1999
-------------------------
Milton Datsopoulos

*                          Director                              November 3, 1999
-------------------------
Gerhard J. Von der Ruhr

*                          Director                              November 3, 1999
-------------------------
N.C. Joseph Lai


*By:  /s/  Emil  H.  Soika                                       November 3, 1999
      --------------------
     Emil  H.  Soika
     Attorney-in-Fact
     Pursuant  to  Power  of  Attorney

</TABLE>

                                       41

<PAGE>
                                  SCHEDULE VIII

                             CRITICARE SYSTEMS, INC.

                        VALUATION AND QUALIFYING ACCOUNTS
                FOR THE YEARS ENDED JUNE 30, 1999, 1998 AND 1997

<TABLE>
<CAPTION>


Column A                          Column B     Column C     Column D    Column E
-------------------------------   -----------  -----------  -----------  ---------

                                  Balance at   Charged to                Balance at
                                  Beginning    Costs and                 End of
Description                       of Period    Expenses     Deductions   Period
-------------------------------   -----------  -----------  -----------  ---------
<S>                              <C>          <C>          <C>          <C>
YEAR ENDED JUNE 30, 1997

Allowance for doubtful accounts

Reserve for sales returns and .  $   295,000  $   366,505  $   194,505  $ 467,000
 allowances
                                 $   504,000  $ 1,283,931  $ 1,647,931  $ 140,000
YEAR ENDED JUNE 30, 1998:

Allowance for doubtful accounts

Reserve for sales returns and .  $   467,000  $    99,000  $   266,000  $ 300,000
 allowances
                                 $   140,000  $ 1,357,917  $ 1,397,917  $ 100,000
YEAR ENDED JUNE 30, 1999:

Allowance for doubtful accounts
                                 $   300,000  $   380,004  $   305,004  $ 375,000
Reserve for sales returns and
 allowances . . . . . . . . . .  $   100,000  $   760,194  $   800,194  $  60,000
</TABLE>




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