SCHEDULE 14A
                                 (Rule 14a-101)

                     INFORMATION REQUIRED IN PROXY STATEMENT

                            SCHEDULE 14A INFORMATION

                Proxy Statement Pursuant to Section 14(a) of the
                         Securities Exchange Act of 1934

Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]

Check the appropriate box:

[X]  Preliminary Proxy Statement            [_]  Confidential, For Use of
[_]  Definitive Proxy Statement                  Commission Only (as permitted
[_]  Definitive Additional Materials             by Rule 14a-6(e)(2))
[_]  Soliciting Material Under Rule 14a-11(c)
     or Rule 14a-12



                       ECLIPSE SURGICAL TECHNOLOGIES, INC.
--------------------------------------------------------------------------------
                (Name of Registrant as Specified In Its Charter)



--------------------------------------------------------------------------------
    (Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)


Payment of Filing Fee (Check the appropriate box):

[X]  No fee required.
[_]  Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

1)   Title of each class of securities to which transaction applies:

________________________________________________________________________________
2)   Aggregate number of securities to which transaction applies:

________________________________________________________________________________

3)   Per unit price or other underlying value of transaction  computed  pursuant
     to Exchange  Act Rule 0-11 (set forth the amount on which the filing fee is
     calculated and state how it was determined):

________________________________________________________________________________
4)   Proposed maximum aggregate value of transaction:

________________________________________________________________________________
5)   Total fee paid:

________________________________________________________________________________
[_]  Fee paid previously with preliminary materials:

________________________________________________________________________________
[_]  Check box if any part of the fee is offset as provided by Exchange Act Rule
     0-11(a)(2)  and identify the filing for which the  offsetting  fee was paid
     previously.  Identify the previous filing by registration statement number,
     or the form or schedule and the date of its filing.

     1)   Amount previously paid:

________________________________________________________________________________
     2)   Form, Schedule or Registration Statement No.:

________________________________________________________________________________
     3)   Filing Party:

________________________________________________________________________________
     4)   Date Filed:

________________________________________________________________________________





                       ECLIPSE SURGICAL TECHNOLOGIES, INC.

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

                    NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

                        To Be Held Friday, June 15, 2001

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

TO THE SHAREHOLDERS:

         NOTICE IS HEREBY  GIVEN that the  Annual  Meeting  of  Shareholders  of
Eclipse Surgical Technologies,  Inc., a California corporation ("Eclipse"), will
be held on Friday,  June 15, 2001, at 2:00 p.m.  Pacific  Daylight  Time, at the
Westin Santa Clara Hotel,  located at 5101 Great America  Parkway,  Santa Clara,
California 95054 for the following purposes:

         1.       To elect five (5)  directors  to serve  until the next  Annual
                  Meeting of Shareholders or until their  successors are elected
                  and qualified.

         2.       To approve an  amendment  to  Eclipse's  Restated  Articles of
                  Incorporation  to change the name of Eclipse to  CardioGenesis
                  Corporation.

         3.       To ratify the appointment of PricewaterhouseCoopers LLP as the
                  independent  auditors  of Eclipse  for the fiscal  year ending
                  December 31, 2001.

         4.       To approve an  amendment  to the Stock Option Plan to increase
                  the number of shares of Common  Stock  reserved  for  issuance
                  thereunder by 500,000 shares.

         5.       To approve an amendment to the Employee Stock Purchase Plan to
                  increase  the number of shares of Common  Stock  reserved  for
                  issuance thereunder by 300,000 shares.

         6.       To transact  such other  business as may properly  come before
                  the meeting,  including  any motion to adjourn to a later date
                  to permit further  solicitation of proxies,  if necessary,  or
                  any adjournment thereof.

         The foregoing  items of business are more fully  described in the Proxy
Statement  accompanying this Notice. Only shareholders of record at the close of
business on April 19, 2001, are entitled to notice of and to vote at the meeting
and any adjournment thereof.

         All shareholders are cordially invited to attend the meeting in person.
However,  to assure your  representation at the meeting,  you are urged to mark,
sign,  date and  return  the  enclosed  proxy as  promptly  as  possible  in the
postage-prepaid  envelope enclosed for that purpose.  Shareholders attending the
meeting may vote in person even if they have returned a proxy.


                                        Sincerely,


                                        /s/ Ian A. Johnston

                                        Ian A. Johnston
                                        Secretary


Sunnyvale, California
May 16, 2001

--------------------------------------------------------------------------------
YOUR VOTE IS IMPORTANT.  IN ORDER TO ASSURE YOUR  REPRESENTATION AT THE MEETING,
YOU ARE REQUESTED TO COMPLETE,  SIGN AND DATE THE ENCLOSED  PROXY AS PROMPTLY AS
POSSIBLE AND RETURN IT IN THE ENCLOSED ENVELOPE.
--------------------------------------------------------------------------------





                       ECLIPSE SURGICAL TECHNOLOGIES, INC.

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

                            PROXY STATEMENT FOR 2001
                         ANNUAL MEETING OF SHAREHOLDERS

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

                 INFORMATION CONCERNING SOLICITATION AND VOTING

General

         This  Proxy  Statement  is  furnished  to the  shareholders  of ECLIPSE
SURGICAL TECHNOLOGIES, INC., a California corporation ("Eclipse"), in connection
with the  solicitation of proxies on behalf of the Board of Directors of Eclipse
for use at the 2001 Annual Meeting of Shareholders ("2001 Annual Meeting") to be
held Friday,  June 15,  2001,  at 2:00 p.m.  Pacific  Daylight  Time,  or at any
adjournment  thereof,  for the purposes set forth herein and in the accompanying
Notice of Annual Meeting of  Shareholders.  The 2001 Annual Meeting will be held
at the Westin Santa Clara Hotel  located at 5101 Great  America  Parkway,  Santa
Clara, California 95054. The telephone number of the Westin Santa Clara Hotel is
(408) 986-0700.

         Our Annual Report to Shareholders for the year ended December 31, 2000,
including financial  statements,  and these proxy materials were first mailed on
or about May 16, 2001 to all shareholders entitled to vote at the meeting.

Record Date and Voting Securities

         Only  shareholders of record at the close of business on April 19, 2001
are  entitled to notice of and to vote at the 2001 Annual  Meeting.  We have one
series of Common Shares outstanding, no par value (the "Common Stock"). On April
19, 2001,  33,696,061 shares of our Common Stock were issued and outstanding and
held of record by 193 registered shareholders.

Voting

         Each shareholder is entitled to one vote for each share of Common Stock
held on the record  date of April 19,  2001.  Every  shareholder  voting for the
election of directors (Proposal One) may cumulate votes and give one candidate a
number of votes equal to the number of directors to be elected multiplied by the
number of shares that the  shareholder is entitled to vote, or distribute  votes
on the same principle  among as many  candidates as the  shareholder may select.
However, votes cannot be cast for more than five (5) candidates.  No shareholder
is entitled to cumulate votes for a particular candidate unless that candidate's
name has been placed in nomination prior to the voting and the  shareholder,  or
any other  shareholder,  has given notice at the meeting,  before the voting, of
his  intention to cumulate  votes.  On all other  matters,  each share of Common
Stock has one vote.  A quorum,  representing  the  holders of a majority  of the
outstanding  shares of Common  Stock on the  record  date,  must be  present  or
represented  for  the  transaction  of  business  at the  2001  Annual  Meeting.
Abstentions and broker nonvotes will be counted in establishing the quorum.

Revocability of Proxies

         Any proxy  given  pursuant to this  solicitation  may be revoked by the
person  giving it at any time before its use by (a)  delivering to the Secretary
of Eclipse a written  notice of revocation  or a duly  executed  proxy bearing a
later date or (b) attending the meeting and voting in person.

Solicitation Expenses

         This  solicitation  of proxies is made by us and all related costs will
be borne by us. We may reimburse brokerage firms and other persons  representing
beneficial  owners  of shares  for their  expenses  in  forwarding  solicitation
material to those beneficial owners. Proxies may also be solicited by certain of
our

                                        1




directors,  officers and regular  employees,  without  additional  compensation,
personally,  by telephone or by telegram.  Except as described  above, we do not
presently intend to solicit proxies other than by mail.

Deadline for Shareholder Proposals

         We currently  intend to hold our 2002 Annual Meeting of Shareholders in
late-May  2002  and to  mail  proxy  statements  relating  to  such  meeting  in
late-April   2002.   Shareholders   interested  in  presenting  a  proposal  for
consideration  at Eclipse's  2002 Annual  Meeting of  Shareholders  may do so by
following the  procedures  prescribed by Rule 14a-8 under the  Securities Act of
1934 and Eclipse's  Bylaws.  To be eligible for inclusion in the proxy statement
and proxy card mailed to shareholders by Eclipse,  shareholder proposals must be
submitted no later than December 21, 2001 to Eclipse Surgical Technologies, Inc.
at  1049  Kiel  Court,  Sunnyvale,   California  94089,  Attention:   Secretary.
Shareholders  who  intend to present a proposal  at the 2002  Annual  Meeting of
Shareholders, without including such proposal in Eclipse's proxy statement, must
provide  Eclipse's  Secretary with written notice of such proposal no later than
February 28, 2002.


                                  PROPOSAL ONE

                              ELECTION OF DIRECTORS

Nominees

         We currently have five (5) directors.  A board of five (5) directors is
to be elected at the 2001 Annual Meeting. Unless otherwise instructed, the proxy
holders will vote the proxies  received by them for our five (5) nominees  named
below, all of whom are presently directors of Eclipse. If any of our nominees is
unable  or  declines  to serve  as a  director  at the  time of the 2001  Annual
Meeting,  the proxies  will be voted for any nominee  who is  designated  by the
present Board of Directors to fill the vacancy.  We are not aware of any nominee
who will be unable or who will  decline to serve as a  director.  If  additional
individuals are nominated for election as directors, the proxy holders intend to
vote  all  proxies  received  by them  in  such a  manner  (in  accordance  with
cumulative  voting)  that will assure the  election  of as many of the  nominees
listed below as possible.  In that event, the specific  nominees to be voted for
will be  determined  by the proxy  holders.  The term of office for each  person
elected  as  a  director  will  continue   until  the  2002  Annual  Meeting  of
Shareholders or until a successor has been duly elected and qualified.

Vote Required

         If a quorum is present and voting,  the five (5) nominees receiving the
highest number of  affirmative  votes will be elected to the Board of Directors.
Abstentions and broker nonvotes are not counted in the election of directors.

Nominees

         The names of the  nominees  and  certain  information  about them as of
March 31, 2001 is set forth below:


Name                                Age                  Position
----                                ---                  --------
Michael J. Quinn                    56      Chief Executive Officer, President,
                                              Chairman of the Board
Jack M. Gill, Ph.D.                 65      Director
Alan L. Kaganov, Sc.D.              62      Director
Robert L. Mortensen(1)(2)           66      Director
Robert C. Strauss(1)(2)             59      Director

----------------
(1)  Member of the Audit Committee.
(2)  Member of the Compensation Committee.

                                        2




         All directors hold office until the next annual meeting of shareholders
or until their successors have been elected and qualified. Officers serve at the
discretion of our Board of Directors and are  appointed  annually.  There are no
family relationships between any of our directors or officers.

         Michael J. Quinn has served as our Chief Executive  Officer,  President
and Chairman of the Board since October 2000.  From 1978 to 1988, Mr. Quinn held
senior  operating  management  positions at the level of Vice  President,  Chief
Operating  Officer and  President at major  healthcare  organizations  including
American  Hospital Supply  Corporation,  Picker  International,  Cardinal Health
Group, Bergen Brunswig and Fisher Scientific.  Most recently Mr. Quinn served as
President and Chief Executive  Officer of Premier Laser Systems,  a manufacturer
of surgical and dental products.  Prior to that position, he served as President
of Imagyn Medical  Technologies,  a manufacturer of minimally  invasive surgical
specialty products.

         Jack M. Gill, Ph.D. has been one of our directors since March 1999. Dr.
Gill  formerly  served as Chairman of the Board of  Directors  of  CardioGenesis
Corporation  from  November 1993 to March 1999.  Dr. Gill is a founding  general
partner of Vanguard Venture Partners and has served in such capacity since 1981.
Dr. Gill is a director of a number of privately held medical  device  companies.
Dr. Gill received his B.S. degree in Engineering  from Lamar  University and his
Ph.D. in Organic Chemistry from Indiana University.

         Alan L.  Kaganov,  Sc.D.  has been one of our  directors  since January
1997.  From December 1999 to October 2000, Dr. Kaganov served as Chief Executive
Officer. Since July 1996, Dr. Kaganov has been a Venture Partner at U.S. Venture
Partners. From May 1993 to June 1996, Dr. Kaganov was Vice President of Business
Development and Strategic Planning at Boston Scientific  Corporation.  From June
1991  until  December  1992  he was  President  and  CEO of EP  Technologies,  a
catheter-based   electrophysiology  company.  Dr.  Kaganov  has  a  Masters  and
Doctorate of Science in biomedical  engineering from Columbia  University and an
M.B.A. from New York University.

         Robert L.  Mortensen  has been one of our  directors  since April 1992.
Since 1984, Mr. Mortensen has been either President or Chairman of the Board and
a director of Lightwave  Electronics  Corporation,  a solid-state  laser company
that he founded. He holds an M.B.A. from Harvard University.

         Robert C. Strauss has been one of our directors  since March 1999.  Mr.
Strauss formerly served on the Board of Directors of  CardioGenesis  Corporation
from December 1997 to March 1999.  Mr. Strauss has served as President and Chief
Executive Officer of Noven Pharmaceuticals, Inc. since December 1997. From March
1997 to July 1997, Mr. Strauss served as President and Chief  Operating  Officer
of IVAX  Corporation,  a  pharmaceutical  company.  In 1983,  Mr. Strauss joined
Cordis Corporation,  a medical device company, as Chief Financial Officer.  From
February  1987 to February  1997,  he served as  President  and Chief  Executive
Officer of Cordis Corporation and in 1995, Mr. Strauss was named Chairman of the
Board.  Mr.  Strauss serves on the board of trustees for the University of Miami
and holds positions on the board of directors of several public  companies.  Mr.
Strauss  received his B.S. degree in Engineering  Physics from the University of
Illinois and his M.S. in Physics from the University of Idaho.

Attendance at Meetings

         Our Board of Directors  held a total of five  meetings  during 2000. Of
the  total  number  of  meetings  of the Board of  Directors  held in 2000,  all
directors attended at least 75% of the meetings held except for Mr. Jack Gill.

         The  Board of  Directors  has an  Audit  Committee  and a  Compensation
Committee.  The Board of Directors  does not have a nominating  committee or any
committee  performing similar functions.  Of the total number of meetings of the
Audit Committee and the Compensation Committee, all directors which were members
of those committees during 2000 attended at least 75% of the meetings held.

Audit Committee

         The Audit  Committee of Eclipse's Board of Directors is composed of two
"independent  directors" as that term is defined by the listing standards of the
National  Association of Securities  Dealers,  Inc. Eclipse intends to appoint a
third independent member to its Audit Committee before the June 14, 2001

                                        3




deadline  therefore  imposed  by such  listing  standards.  The Audit  Committee
operates  under a written  charter  adopted by the Board of  Directors  which is
attached hereto as Apendix C.

         In 2000,  the Audit  Committee  consisted  of Robert L.  Mortensen  and
Robert C. Strauss and met one (1) time. This committee is primarily  responsible
for  approving  the  services  performed  by our  independent  auditors  and for
reviewing and  evaluating  our  accounting  principles  and Eclipse's  system of
internal accounting controls. For additional information on the Audit Committee,
see "REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS."

Compensation Committee

         In 2000, the  Compensation  Committee  consisted of Robert L. Mortensen
and  Robert C.  Strauss  and met five (5)  times.  This  committee  reviews  and
approves our executive  compensation policy and plan. For additional information
on the Compensation Committee,  see "REPORT OF THE COMPENSATION COMMITTEE OF THE
BOARD OF DIRECTORS."

Compensation Committee Interlocks and Insider Participation

         The Compensation Committee of our Board of Directors for the year ended
December 31, 2000  consisted of Robert L.  Mortensen and Robert C.  Strauss.  No
member of the Compensation Committee has a relationship that would constitute an
interlocking  relationship  with  executive  officers  or  directors  of another
entity.

Director Compensation

         For  serving  on  the  Board  of  Directors,   directors  who  are  not
compensated  as our employees or as consultants to us receive fees of $1,500 per
board meeting and $500 per committee  meeting,  provided such committee  meeting
does not occur on the same day as a board meeting. We also have a Director Stock
Option Plan for non-employee  directors.  In fiscal year 2000, directors Jack M.
Gill,  Robert C.  Strauss,  Alan L.  Kaganov and Robert L.  Mortensen  were each
granted an option to purchase an  aggregate of 7,500 shares of Common Stock each
upon re-election to our Board of Directors.

Recommendation

         THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE APPROVAL OF THE FIVE
(5) NOMINEES FOR THE BOARD OF DIRECTORS LISTED ABOVE.


                                  PROPOSAL TWO

                  AMEND THE RESTATED ARTICLES OF INCORPORATION
                          TO CHANGE THE CORPORATE NAME

Proposed Amendment

         Eclipse's  Board of Directors has adopted,  and is  recommending to the
shareholders  for their  approval at the 2001 Annual  Meeting,  a resolution  to
amend Article First of Eclipse's  Restated  Articles of  Incorporation to change
the corporate name. The applicable text of the Board's resolution is as follows:

                  "RESOLVED,  that Article First of Eclipse's  Restated Articles
         of Incorporation be amended to read in its entirety as follows:

                                      FIRST

              The name of this corporation (the "Corporation") is:

                           CardioGenesis Corporation."

         The Board of Directors  believes that the new name  CardioGenesis  will
help Eclipse's  customers,  shareholders  and the investment  community to fully
grasp the  nature of the  company's  products.  Eclipse's  products  are used in
procedures  for the  treatment  of  severe  chest  pain  known as  angina.  More
specifically, the products are used in transmyocardial revascularization ("TMR")
and percutaneous transluminal

                                        4




myocardial  revascularization  ("PTMR") treatments in which channels are made in
the  heart  muscle.  It  is  believed  these  procedures  encourage  new  vessel
formation, or angiogenesis, and result in reduced angina pain.

         Eclipse's Board of Directors  believes that the new name  CardioGenesis
communicates  two key features of the company's  products:  (i) our products are
used  in  cardiological  treatments;  and  (ii)  we  believe  angiogenesis,  the
formation  of new vessels in the heart,  to be one of the major  benefits of TMR
and PTMR.

         If the  amendment  is  adopted,  shareholders  will not be  required to
exchange outstanding stock certificates for new certificates.

Approval by Shareholders

         Approval of this proposal  requires the affirmative vote of the holders
of a majority of the outstanding shares of Common Stock of Eclipse.  If approved
by the  shareholders,  the amendment to Article First will become effective upon
filing with the Secretary of State of  California of a Certificate  of Amendment
to Eclipse's  Restated  Articles of  Incorporation,  which filing is expected to
take place shortly  after the Annual  Meeting.  However,  the Board of Directors
will be authorized,  without a further vote of the shareholders,  to abandon the
name change and determine not to file the  Certificate of Amendment if the Board
concludes  that such action  would be in the best  interests  of Eclipse and its
shareholders.  If this  proposal is not approved by the  shareholders,  then the
Certificate of Amendment will not be filed.

Recommendation

         THE BOARD OF DIRECTORS  BELIEVES  THAT THE PROPOSAL TO AMEND  ECLIPSE'S
RESTATED  ARTICLES OF  INCORPORATION TO CHANGE THE CORPORATE NAME IS IN THE BEST
INTERESTS OF ECLIPSE AND ITS SHAREHOLDERS AND RECOMMENDS A VOTE FOR THE APPROVAL
OF THE PROPOSAL.


                                 PROPOSAL THREE

               RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS

         Our  Board  of  Directors  has  selected   PricewaterhouseCoopers  LLP,
independent  auditors,  to audit our consolidated  financial  statements for the
fiscal year ending December 31, 2001, and recommends that the shareholders  vote
for ratification of that appointment.  Notwithstanding this selection, the Board
of Directors,  in its discretion,  may direct the appointment of new independent
auditors at any time during the year, if the Board of Directors  feels that such
a change would be in the best interest of Eclipse and our shareholders. If there
is a negative vote on  ratification,  our Board of Directors will reconsider its
selection.

         PricewaterhouseCoopers   LLP  has  audited  our  financial   statements
annually since 1989.  Representatives of PricewaterhouseCoopers LLP are expected
to be  present  at the  2001  Annual  Meeting  with  the  opportunity  to make a
statement  if they desire to do so. They are also  expected to be  available  to
respond to appropriate questions.

Audit Fees

         For the year  ended  December  31,  2000,  PricewaterhouseCoopers  LLP,
Eclipse's  independent public accountants,  will charge Eclipse approximately an
aggregate  of  $111,335  for  professional  services  rendered  for the audit of
Eclipse's  financial  statements for such period and the review of the financial
statements  included  in  Eclipse's  Quarterly  Reports on Form 10-Q during such
period.

Financial Information Systems Design and Implementation Fees

         PricewaterhouseCoopers   LLP  did  not  render  professional   services
relating to financial  information  systems  design and  implementation  for the
fiscal year ended December 31, 2000.

                                        5




All Other Fees

         For the year ended December 31, 2000, PricewaterhouseCoopers LLP billed
Eclipse an aggregate of $36,500 for all other services not described above under
the caption "Audit Fees" during such period.

Vote Required

         The  affirmative  vote of a majority  of the votes cast is  required to
ratify the Board of Director's  selection.  In addition,  the affirmative  votes
must represent at least a majority of the required  quorum.  If the shareholders
reject the nomination, our Board of Directors will reconsider its selection.

Recommendation of the Board of Directors

         THE BOARD OF DIRECTORS  RECOMMENDS A VOTE "FOR" THE RATIFICATION OF THE
APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AS INDEPENDENT AUDITORS.


                                  PROPOSAL FOUR

          AMENDMENT TO THE STOCK OPTION PLAN TO INCREASE THE NUMBER OF
                 SHARES OF COMMON STOCK RESERVED FOR ISSUANCE BY
                                 500,000 SHARES

Increase of 500,000 Shares of Common Stock

         The Stock Option Plan of Eclipse, as amended and restated in April 1996
(the "Option Plan"), was approved by the Board of Directors and the shareholders
in April  1996.  A total of  5,100,000  shares  of Common  Stock  are  currently
reserved  for  issuance  under the  Option  Plan.  In March  2001,  the Board of
Directors approved a further increase of 500,000 shares of Common Stock issuable
under the Option Plan,  which, if approved,  by the shareholders  would increase
the total  shares of Common Stock  reserved  for issuance  under the Option Plan
since its inception to 5,600,000 shares. The Option Plan terminates on March 31,
2006. A summary of the principal terms of the Option Plan is located in Appendix
A to this Proxy Statement.

         The Board of Directors believes the requested increase in the shares of
Common  Stock  reserved  for  issuance  under  the  Option  Plan is in the  best
interests of Eclipse.  The Board of Directors  believes  that the increase  will
provide an adequate  reserve of shares of Common  Stock  available  for issuance
under  the  Option  Plan,  which is  necessary  to  enable  Eclipse  to  compete
successfully with other companies in attracting and retaining valuable employees
and to expand its operations.

         As of March 31, 2001,  options to purchase  3,469,104  shares of Common
Stock were  unexercised and  outstanding  under the Option Plan. As of March 31,
2001,  1,221,808  shares of Common Stock  remained  available  for future option
grants under the Option Plan, excluding the proposed increase of 500,000 shares.
The  aggregate  market  value of the  unexercised  and  outstanding  options  to
purchase  3,469,104  shares of Common  Stock  under the Option Plan at March 31,
2001 was  $3,795,200  based on a closing price of $1.094 on the Nasdaq  National
Market on that date.  See the section  entitled  "Amended and New Plan Benefits"
below for certain  information  with respect to options granted under the Option
Plan in 2000.

Vote Required

         The  affirmative  vote of a majority of the shares of the Common  Stock
present  or  represented  and  entitled  to vote at the 2001  Annual  Meeting is
required for approval of this Proposal.

Recommendation

         THE BOARD OF  DIRECTORS  RECOMMENDS  A VOTE "FOR" THE  APPROVAL  OF THE
AMENDMENT  TO THE OPTION PLAN TO INCREASE  THE NUMBER OF SHARES OF COMMON  STOCK
RESERVED FOR ISSUANCE THEREUNDER BY 500,000 SHARES.

                                        6




                                  PROPOSAL FIVE

         AMENDMENT TO THE 1996 EMPLOYEE STOCK PURCHASE PLAN TO INCREASE
          THE NUMBER OF SHARES OF COMMON STOCK RESERVED FOR ISSUANCE BY
                                 300,000 SHARES

Increase of 300,000 Shares of Common Stock

         The 1996 Employee Stock Purchase Plan of Eclipse (the "Purchase  Plan")
was approved by the Board of Directors and by the  shareholders in April 1996. A
total of 400,000  shares of Common  Stock are  currently  reserved  for issuance
under the  Purchase  Plan.  In March  2001,  the Board of  Directors  approved a
further  increase of 300,000  shares of Common Stock issuable under the Purchase
Plan,  which, if approved by the  shareholders,  would increase the total shares
reserved for issuance  under the  Purchase  Plan since its  inception to 700,000
shares.  The Purchase Plan  terminates in April 2006. A summary of the principal
terms of the Purchase Plan is located in Appendix B to this Proxy Statement.

         The Purchase  Plan,  which is intended to qualify  under Section 423 of
the Code,  permits  eligible  employees to purchase Common Stock through payroll
deductions  at a price equal to 85% of the fair market value of the Common Stock
at the  beginning  or at the end of each  offering  period,  whichever is lower.
Qualified  employees are eligible to  participate  at the beginning of the first
day of an offering  period  after their first full  calendar  month of full time
employment.  As of March 31, 2001, a total of 328,133 shares of Common Stock had
been purchased under the Purchase Plan and 71,867 shares remained  available for
future  purchase under the Purchase  Plan..  See "Amended and New Plan Benefits"
below for certain information with respect to participation in the Purchase Plan
in 2000.

         The Purchase Plan is voluntary and encourages  and motivates  employees
to participate in Eclipse's future through direct stock ownership.  The Board of
Directors  believes  that  the  availability  of  sufficient  number  of  shares
available for issuance  under the Purchase  Plan is integral to attract,  retain
and motivate qualified employees fundamental to the success of Eclipse.  Subject
to shareholder approval, the Board of Directors has amended the Purchase Plan to
increase  the number of shares of Common Stock  reserved for issuance  under the
Purchase Plan from 400,000 shares to 700,000 shares.

Vote Required

         The  affirmative  vote of a majority of the shares of the Common  Stock
present  or  represented  and  entitled  to vote at the 2001  Annual  Meeting is
required for approval of this Proposal.

Recommendation

         THE BOARD OF  DIRECTORS  RECOMMENDS  A VOTE "FOR" THE  APPROVAL  OF THE
AMENDMENT TO THE 1996  EMPLOYEE  STOCK  PURCHASE  PLAN TO INCREASE THE NUMBER OF
SHARES OF COMMON STOCK  RESERVED FOR ISSUANCE UNDER THE PURCHASE PLAN BY 300,000
SHARES.

                                        7




                               SECURITY OWNERSHIP
                          OF CERTAIN BENEFICIAL OWNERS
                                 AND MANAGEMENT

         The following table sets forth as of March 31, 2001 (except as noted in
the footnotes) certain  information with respect to the beneficial  ownership of
our Common Stock by (i) each person known by us to own beneficially more than 5%
of our  outstanding  shares of Common Stock;  (ii) each of our directors;  (iii)
each of our  current  Named  Executive  Officers;  and  (iv) all  directors  and
executive  officers as a group.  Except as  indicated  in the  footnotes to this
table,  the  persons  and  entities  named in the  table  have sole  voting  and
investment   power  with  respect  to  all  shares  of  Common  Stock  shown  as
beneficially owned by them, subject to community property laws where applicable.


                                                     Shares of Common Stock
                                                      Beneficially Owned(1)
                                                    -------------------------
                                                                   Percentage
Name of Beneficial Owner                               Number      Ownership
-------------------------------------------------   -----------   -----------
5% Shareholders:
Douglas Murphy-Chutorian, M.D(2) ................    3,370,921        10.6%
 c/o MD DataDirect, Inc.
 724 Oak Grove Avenue, Suite 120,
 Menlo Park, CA 94025

Brown Capital Management, Inc. (3) ..............    2,708,073         8.5%
 1201North Calvert Street
 Baltimore, MD 21202

State of Wisconsin Investment Board (4) .........    4,088,000        12.9%
 120 East Wilson Street
 Madison, WI 53703


Directors:
Jack M. Gill, Ph.D.(5) ..........................    1,201,325         3.8%
Alan L. Kaganov, Sc.D(6) ........................      365,000         1.2%
Robert L. Mortensen(7) ..........................       95,196           *
Robert C. Strauss(8) ............................       24,190           *


Named Executive Officers:
Michael J. Quinn (9)(10) ........................      166,110           *
Darrell F. Eckstein .............................           --           *
Ian A. Johnston (11) ............................       37,805           *
Thomas L. Kinder (12) ...........................        1,389           *
Richard P. Lanigan (13) .........................       79,273           *
All directors and officers as a group
 (9 persons)(14) ................................    1,970,288         6.2%

----------------
*    Less than 1%.

(1)  Percentage  ownership  is  based  on  31,696,061  shares  of  Common  Stock
     outstanding as of March 31, 2001.

(2)  The number of shares of Common  Stock  beneficially  owned or of record has
     been determined  solely from  information  provided to Eclipse from Douglas
     Murphy-Chutorian  as of April 26,  2001.  Includes an  aggregate of 413,274
     shares of Common  Stock  held by Leslie  Murphy-Chutorian,  the wife of Dr.
     Murphy-Chutorian, as custodian for Blair Murphy-Chutorian, UTMA California,
     an   aggregate   of  413,274   shares  of  Common   Stock  held  by  Leslie
     Murphy-Chutorian as custodian for Dana  Murphy-Chutorian,  UTMA California.
     Also  includes an  aggregate  of  1,719,973  shares of Common Stock held by
     Leslie  Murphy-Chutorian  and  Dr.  Murphy-Chutorian  as  Trustees  of  The
     Murphy-Chutorian  Family  Trust UDT dated  1-13-97.  Also  includes  12,000
     shares of Common Stock held by The Murphy Chutorian Family Foundation. Also
     includes 49,998 shares of Common Stock subject to stock options held by Dr.
     Murphy-Chutorian that are exercisable within 60 days of March 31, 2001.

                                        8




(3)  The number of shares of Common  Stock  beneficially  owned or of record has
     been determined  solely from  information  reported on a Schedule 13G as of
     December 31, 2000.

(4)  The number of shares of Common  Stock  beneficially  owned or of record has
     been determined solely from information  provided to Eclipse from the State
     of Wisconsin Investment Board as of April 12, 2001.

(5)  Includes 23,507 shares of Common Stock subject to stock options held by Dr.
     Gill that are exercisable within 60 days of March 31, 2001.

(6)  Includes  365,000  shares of Common Stock  subject to stock options held by
     Mr. Kaganov that are exercisable within 60 days of March 31, 2001.

(7)  Includes 95,196 shares of Common Stock subject to stock options held by Mr.
     Mortensen that are exercisable within 60 days of March 31, 2001.

(8)  Includes 24,190 shares of Common Stock subject to stock options held by Mr.
     Strauss that are exercisable within 60 days of March 31, 2001.

(9)  Michael  J.  Quinn is both a member of the Board of  Directors  and a Named
     Executive  Officer in his positions as Eclipse's Chief  Executive  Officer,
     President and Chairman of the Board.

(10) Includes  136,110  shares of Common Stock  subject to stock options held by
     Mr. Quinn that are exercisable within 60 days of March 31, 2001.

(11) Includes 37,805 shares of Common Stock subject to stock options held by Mr.
     Johnston that are exercisable within 60 days of March 31, 2001.

(12) Includes  1,389 shares of Common Stock subject to stock options held by Mr.
     Kinder that are exercisable within 60 days of March 31, 2001.

(13) Includes 79,273 shares of Common Stock subject to stock options held by Mr.
     Lanigan that are exercisable within 60 days of March 31, 2001.

(14) Includes options to purchase an aggregate of 762,470 shares of Common Stock
     held by all officers and directors as a group exercisable within 60 days of
     March 31, 2001.


                                   MANAGEMENT

Executive Officers

         The following table and discussion set forth certain  information  with
regards  to  Eclipse's  current  executive   officers  (the  "Current  Executive
Officers").


Name                  Age                                 Position
--------------------- -----   --------------------------------------------------
Michael J. Quinn      56      Chief Executive Officer, President and Chairman
                                of the Board
Darrell F. Eckstein   43      Vice President of Operations
Ian A. Johnston       46      Vice President of Finance and Treasurer
Thomas L. Kinder      38      Vice President of Worldwide Sales and Service
Richard P. Lanigan    42      Vice President of Governmental Affairs and
                                Business Development


         Biographical  information for Michael J. Quinn is set forth above under
Proposal One for the Election of Directors.

         Darrell F.  Eckstein  has served as our Vice  President  of  Operations
since December  2000.  From 1996 to 2000 he served as Vice President and General
Manager of the Surgical  Products  Division of Imagyn  Medical  Technologies,  a
manufacturer of minimally  invasive surgical  specialty  products.  From 1995 to
1996, Mr. Eckstein was Vice President of Finance, Chief Financial Officer and an
Executive  Committee member of Richard-Allen  Medical Industries Inc., a medical
devices company.  From 1991 to 1995, Mr. Eckstein was Vice President of Finance,
Chief Financial Officer and an Executive  Committee member of National Emergency
Services, Inc., a health care services company that provides physician contract

                                        9




management,  medical billing and insurance services. Prior to 1991, Mr. Eckstein
worked for Deloitte & Touche LLP, most recently as a Senior Audit  Manager,  for
eleven  years.  He received his Bachelor of Science  degree in  Accounting  from
Indiana University.

         Ian A. Johnston has been our Vice  President of Finance since July 2000
and Corporate  Controller  since March 1999. From 1998 to 1999, Mr. Johnston was
Controller of CardioGenesis Corporation.  From 1989 to 1998, Mr. Johnston served
in a variety of financial  positions  (most  recently as  Controller) at Toshiba
America MRI, Inc., a medical  imaging  company.  From 1985 to 1989, Mr. Johnston
was an auditor with Arthur Andersen & Co. Mr. Johnston has a Masters in Business
Administration  and a  Bachelor  of Arts in  Economics  from the  University  of
California  Berkeley  and is a member of the  American  Institute  of  Certified
Public Accountants.

         Thomas L. Kinder has served as our Vice  President of  Worldwide  Sales
and Service since March 2001 and as General  Manager,  West Area since  November
2000.  Prior to Eclipse,  Mr. Kinder held senior sales positions at the level of
Vice  President,  General  Manager and  National  Sales  Director at  healthcare
companies  including Karl Storz Endoscopy,  and Imagyn Medical  Technologies and
Microsurge,  Inc. Mr.  Kinder began his medical  device sales career with United
States Surgical Corporation.

         Richard P. Lanigan has been our Vice  President of  Government  Affairs
and Business Development since March 2001, Vice President of Sales and Marketing
since March 2000 and Director of Marketing  since 1997.  From 1992 to 1997,  Mr.
Lanigan served in various positions, most recently Marketing Manager, at Stryker
Endoscopy. From 1987 to 1992, Mr. Lanigan served in Manufacturing and Operations
management at Raychem Corporation. From 1981 to 1987, he served in the U.S. Navy
where he completed six years of service as  Lieutenant in the Supply Corps.  Mr.
Lanigan has a Bachelors of Arts in Finance from Notre Dame and a Masters  degree
in Systems Management from the University of Southern California.


                    EXECUTIVE COMPENSATION AND OTHER MATTERS

Employment Contracts of Executive Officers

         Michael  J.  Quinn  entered  into a letter  employment  agreement  with
Eclipse effective October 16, 2000. The agreement  provides for an annual salary
of  $330,000,  subject to annual  review and increase at the  discretion  of the
Board of Directors  and options to acquire  700,000  shares of Eclipse's  Common
Stock at an  exercise  price  equal to $1.688 per  share,  which is the price of
Eclipse's Common Stock on the date the option was granted. Mr. Quinn may also be
entitled to receive (i) an annual bonus, the amount of which shall be determined
by the Board of Directors and (ii) options or other rights to acquire  Eclipse's
Common  Stock,  under  terms  and  conditions  determined  by  the  Compensation
Committee of the Board of Directors.  Mr.  Quinn's letter  employment  agreement
provides that his employment is "at will" at the discretion of Eclipse, and that
he may be  terminated  at any time with or  without  notice  and with or without
cause.

         Darrell F. Eckstein  entered into a letter  employment  agreement  with
Eclipse effective December 19, 2000. The agreement provides for an annual salary
of  $225,000,  subject to annual  review and increase at the  discretion  of the
Board of Directors  and options to acquire  100,000  shares of Eclipse's  Common
Stock at an  exercise  price  equal to $0.563 per  share,  which is the price of
Eclipse's Common Stock on the date the option was granted. Mr. Eckstein may also
be  entitled  to  receive  (i) an annual  bonus,  the  amount of which  shall be
determined by the Board of Directors and (ii) options or other rights to acquire
Eclipse's   Common  Stock,   under  terms  and  conditions   determined  by  the
Compensation  Committee  of  the  Board  of  Directors.  Mr.  Eckstein's  letter
employment agreement provides that his employment is "at will" at the discretion
of Eclipse, and that he may be terminated at any time with or without notice and
with or without cause.

Executive Officer Compensation


         The  following  table sets forth  certain  information  concerning  the
annual and long-term  compensation  for services  rendered in all  capacities to
Eclipse for the fiscal year 2000 by (i) all individuals who served

                                       10




at one point during 2000 as Eclipse's  Chief  Executive  Officer,  (ii) the four
most highly compensated  executive  officers having  compensation of $100,000 or
more  serving  at the end of the  fiscal  year  2000,  and (iii) two  additional
individuals who served as executive  officers for Eclipse during the fiscal year
2000 but were not employed as  executive  officers at the end of the fiscal year
2000 (collectively, the "Named Executive Officers".


                                              SUMMARY COMPENSATION TABLE


                                                                                        Long Term
                                                                                      Compensation
                                                                                         Awards
                                                                                     --------------
                                             Annual Compensation      Other Annual     Securities
                                            ---------------------- -----------------   Underlying
                                    Fiscal                                             Options/SAR      All Other
Name and Principal Position          Year    Salary($)   Bonus($)   Compensation($)        (#)       Compensation($)
--------------------------------   -------- ----------- ---------- ----------------- -------------- ----------------
                                                                             
Michael J. Quinn(1) ............    2000     $ 66,000         --      $  15,217(2)       700,000              --
 Chief Executive Officer            1999           --         --             --               --              --
                                    1998           --         --             --               --              --
Alan L. Kaganov(1)(3) ..........    2000           --         --             --          107,500         $ 7,500
 Former Chief Executive Officer     1999           --         --             --          157,500          15,000
                                    1998           --         --             --            7,500          19,000
Janet K. Castaneda(4) ..........    2000      170,000    $26,300             --           25,000              --
 Former Vice President of           1999      140,425         --             --           40,001              --
 Legal Affairs                      1998      132,500     12,825             --            9,999              --
Ian A. Johnston ................    2000      137,000         --             --           30,000              --
 Vice President of Finance          1999      105,594     20,000             --           30,000              --
                                    1998           --         --             --               --              --
Richard P. Lanigan(5) ..........    2000      170,000     24,600             --           50,000              --
 Vice President of Sales and        1999      134,458         --             --           33,000              --
 Marketing                          1998      105,528     10,398             --           15,500              --
Nancy Lince(4) .................    2000      162,000     34,800             --           30,000              --
 Former Vice President of           1999      105,398     20,000             --           44,500              --
 Regulatory and Clinical Affairs    1998       85,728      7,716             --               --              --
William E. Picht(6) ............    2000      135,088     32,700             --               --              --
 Former Vice President of           1999      204,909         --             --           30,000              --
 Operations                         1998      181,500     16,335             --           15,000              --
Richard P. Powers(7) ...........    2000      170,000     34,800             --               --              --
 Former Executive Vice              1999      219,248     36,765             --           79,280              --
 President of Administration        1998           --         --             --               --              --
 and Chief Financial Officer


----------------
(1)  Effective as of October 16, 2000, Mr. Kaganov  resigned as Eclipse's  Chief
     Executive  Officer  and Mr.  Quinn  became  our  Chief  Executive  Officer,
     President and Chairman of the Board.

(2)  Housing allowance and health insurance premiums.

(3)  Dr. Kaganov received no salary as the Chief Executive Officer, but was paid
     for his services as one of our directors in 1998, 1999 and 2000.

(4)  Ms. Castaneda and Ms. Lince are no longer employees of Eclipse.

(5)  Effective  March 2001,  Mr.  Lanigan  became Vice  President of  Government
     Affairs and Business Development.

(6)  Mr. Picht resigned on August 25, 2000.

(7)  Mr. Powers resigned on July 18, 2000.



                                       11




Option Grants in Fiscal Year 2000


         The  following  tables set forth  information  regarding  stock options
granted to and exercised by the Named Executive  Officers during our fiscal year
ended December 31, 2000.

                                            OPTION GRANTS IN LAST FISCAL YEAR
                                                   INDIVIDUAL GRANTS(1)


                                                                                            Potential Realizable Value at
                                      Number of                                               Annual Rates of Stock Price
                                     Securities       % of Total                                Appreciation for Option
                                     Underlying   Options Granted to    Exercise                       Term(2)
                                       Options       Employees in      Price per   Expiration  -------------------------
Name                                   Granted        Fiscal Year        Share        Date          5%          10%
----------------------------------- ------------ -------------------- ----------- ------------ ----------- -------------
                                                                                          
Michael J. Quinn ..................   700,000            45.04%         $ 1.688     10/17/10    $743,102    $1,883,166
Alan L. Kaganov, Sc.D.(3) .........   100,000             6.43%         $ 4.063      7/28/10     255,520       647,538
Janet K. Castaneda ................    25,000             1.61%         $ 1.375     11/28/10      21,618        54,785
Ian A. Johnston ...................     5,000             0.32%         $ 4.00       7/11/10      12,578        31,875
                                       25,000             1.61%         $ 1.375     11/28/10      21,618        54,785
Richard P. Lanigan ................    25,000             1.61%         $ 6.563      4/11/10      57,373       188,544
                                       25,000             1.61%         $ 1.375     11/28/10      21,618        54,785
Nancy Lince .......................     5,000             0.32%         $ 4.00       7/11/10      12,578        31,875
                                       25,000             1.61%         $ 1.375     11/28/10      21,618        31,875
William E. Picht ..................        --               --               --           --          --            --
Richard P. Powers .................        --               --               --           --          --            --


----------------
(1)  These  options were  granted  pursuant to our Stock Option Plan. A total of
     1,554,150  shares of Common Stock  issuable  upon  exercise of options were
     granted to our employees in the year ended December 31, 2000.

(2)  In accordance  with the rules of the  Securities  and Exchange  Commission,
     shown are the  hypothetical  gains or "option spreads" that would exist for
     the  respective  options.  These gains are based on assumed rates of annual
     compounded stock price  appreciation of 5% and 10% from the date the option
     was granted  over the full  option  term.  The 5% and 10% assumed  rates of
     appreciation  are mandated by the rules of the SEC and do not represent our
     estimate  or  projection  of future  increases  in the price of our  Common
     Stock.

(3)  Dr.  Kaganov was also granted 7,500 stock options  pursuant to our Director
     Stock Option Plan during the year ended December 31, 2000.



                                       12




Options Outstanding in Fiscal Year 2000


         The following  table sets forth certain  information for the year ended
December 31, 2000  concerning  exercised,  exercisable and  unexercisable  stock
options held by each of the Named Executive Officers.


                                        AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR
                                               AND FISCAL YEAR-END OPTION VALUES


                                                                  Number of Securities
                                                                 Underlying Unexercised             Value of Unexercised
                                    Shares                             Options at                 In-the-Money Options at
                                   Acquired                       Fiscal Year-End (#):           Fiscal Year-End ($) (1) :
                                      on           Value     -------------------------------   ------------------------------
                                 Exercise(#)     Realized     Exercisable     Unexercisable     Exercisable     Unexercisable
                                -------------   ----------   -------------   ---------------   -------------   --------------
                                                                                                   
Michael J. Quinn ..............      --            --            38,889          661,111            --               --
Alan L. Kaganov, Sc.D .........      --            --           372,500               --            --               --
Janet K. Castaneda ............      --            --            58,053           46,947            --               --
Ian A. Johnston ...............      --            --            27,386           52,614            --               --
Richard P. Lanigan ............      --            --            40,957           65,043            --               --
Nancy Lince ...................      --            --            20,305           54,487            --               --
William E. Picht ..............      --            --                --               --            --               --
Richard P. Powers .............      --            --           186,653           43,346            --               --


----------------
(1)  The value for an "in the money" option  represents the  difference  between
     the  exercise  price of such option as  determined  by  Eclipse's  Board of
     Directors and the closing  price of Eclipse's  Common Stock on December 31,
     2000  ($0.844),  multiplied  by the total  number of shares  subject to the
     option.




Amended and New Plan Benefits

         The  following  table sets forth,  as to the executive  officers  named
under "Executive  Compensation Summary Compensation Table" above as well as each
of the Current Executive Officers  individually,  all Current Executive Officers
as of March 31, 2001 as a group,  all directors as of March 31, 2001 who are not
executive  officers as a group and all other employees as of March 31, 2001 as a
group the following  information regarding benefits received or allocated to the
persons and groups set forth below for the last completed  fiscal year: (a) with
respect to the Option  Plan:  (i) the market value of the shares of Common Stock
underlying  such options as of March 31, 2001 based on a closing price of $1.094
on the Nasdaq  National  Market on that date,  minus the exercise  price of such
shares;  and (ii) the  number of shares of  Eclipse's  Common  Stock  subject to
options  granted during the fiscal year ended December 31, 2000 under the Option
Plan;  (b) with respect to the Purchase Plan: (i) the market value of the shares
of Common Stock  issued as of March 31, 2001 based on a closing  price of $1.094
on the Nasdaq  National  Market on that date,  minus the purchase  price of such
shares; and (ii) the number of shares of Eclipse's Common Stock issued under the
Purchase  Plan  during the fiscal year ended  December  31,  2000;  and (c) with
respect to the Director Plan: (i) the market value of the shares of Common Stock
underlying  such options as of March 31, 2001 based on a closing price of $1.094
on the Nasdaq  National  Market on that date,  minus the exercise  price of such
shares;  and (ii) the  number of shares of  Eclipse's  Common  Stock  subject to
options  granted under the Director  Plan during fiscal year ended  December 31,
2000.

                                       13




                                                             Stock
                                                          Option Plan
                                                -------------------------------
                                                                   Number of
               Name of Individual                               Shares Subject
                 or Identity of                     Dollar        To Options
               Group or Position                 Values($)(1)     Granted(#)
----------------------------------------------- -------------- ----------------
Michael J. Quinn ..............................          --         700,000
 Chief Executive Officer,
 President and Chairman of the Board
Janet K. Castaneda (2) ........................          --          25,000
 Former Vice President of Legal Affairs
Darrell F. Eckstein ...........................     $53,100         100,000
 Vice President of Operations
Ian A. Johnston ...............................          --          30,000
 Vice President of Finance and Treasurer
Thomas L. Kinder ..............................          --          25,000
 Vice President of Worldwide Sales and
 Service
Richard P. Lanigan ............................          --          50,000
 Vice President of Government Affairs
 and Business Development
Nancy Lince (2) ...............................          --          30,000
 Former Vice President of Regulatory
 and Clinical Affairs
William E. Picht(2) ...........................          --              --
 Former Vice President of Operations
Richard P. Powers(2) ..........................          --              --
 Former Executive Vice President
 of Administration and
 Chief Financial Officer
Jack M. Gill Ph.D. ............................          --              --
 Director
Alan L. Kaganov, Sc.D. ........................          --              --
 Director
Robert L. Mortensen ...........................          --              --
 Director
Robert C. Strauss .............................          --              --
Director
All Current Executive Officers as a group .....     $53,100         905,000
All current directors who are not executive
 officers as a group ..........................          --              --
All other employees as a group ................     $    55         641,150





                                                      1996 Employee                  Directors
                                                   Stock Purchase Plan           Stock Option Plan
                                                -------------------------- ------------------------------
                                                                                             Number of
               Name of Individual                               Number of                  Shares Subject
                 or Identity of                     Dollar        Shares       Dollar        to Options
               Group or Position                 Values($)(1)   Issued(#)   Values($)(1)     Granted(#)
----------------------------------------------- -------------- ----------- -------------- ---------------
                                                                                       
Michael J. Quinn ..............................      --              --         --                 --
 Chief Executive Officer,
 President and Chairman of the Board
Janet K. Castaneda (2) ........................      --              --         --                 --
 Former Vice President of Legal Affairs
Darrell F. Eckstein ...........................      --              --         --                 --
 Vice President of Operations
Ian A. Johnston ...............................      --              --         --                 --
 Vice President of Finance and Treasurer
Thomas L. Kinder ..............................      --              --         --                 --
 Vice President of Worldwide Sales and
 Service
Richard P. Lanigan ............................      --           3,985         --                 --
 Vice President of Government Affairs
 and Business Development
Nancy Lince (2) ...............................      --              --         --                 --
 Former Vice President of Regulatory
 and Clinical Affairs
William E. Picht(2) ...........................      --              --         --                 --
 Former Vice President of Operations
Richard P. Powers(2) ..........................      --           2,009         --                 --
 Former Executive Vice President
 of Administration and
 Chief Financial Officer
Jack M. Gill Ph.D. ............................      --              --         --              7,500
 Director
Alan L. Kaganov, Sc.D. ........................      --              --         --              7,500
 Director
Robert L. Mortensen ...........................      --              --         --              7,500
 Director
Robert C. Strauss .............................      --              --         --              7,500
Director
All Current Executive Officers as a group .....      --              --         --                 --
All current directors who are not executive
 officers as a group ..........................      --              --         --             30,000
All other employees as a group ................      --              --         --                 --


----------------
(1)  If no value is listed,  stock options  granted under the Stock Option Plan,
     Directors  Option  Plan or  Employee  Stock  Purchase  Plan are of no value
     because  the  exercise  price of the stock  options  is above  the  current
     trading price of Eclipse's Common Stock on March 31, 2001.

(2)  No  longer  employees  as of March 31,  2001 and not  included  as  Current
     Executive Officers.




Certain Transactions with Management

         In November 2000,  Eclipse exercised  warrants in MicroHeart  Holdings,
Inc.  ("MicroHeart"),  a Delaware company previously formed by U.S. Ventures and
Venrock Associates,  in exchange for common stock. This transaction  resulted in
an increase in Eclipse's  ownership in  MicroHeart  to 32.1%.  Mr. Alan Kaganov,
former  Chief  Executive  Officer  and a current  director  of Eclipse is also a
director of MicroHeart.  Mr. Kaganov is also a Venture  Partner of U.S.  Venture
Partners.

                                       14





Section 16(a) Beneficial Ownership Reporting Compliance

         Section  16(a) of the  Securities  Exchange  Act of 1934  requires  our
executive officers and directors, and persons who own more than ten percent of a
registered  class of our equity  securities  to file  reports of  ownership  and
changes  in  ownership  with the  Securities  and  Exchange  Commission  and the
National Association of Securities Dealers,  Inc. Executive officers,  directors
and  greater-than-ten-percent  shareholders  are required by SEC  regulation  to
furnish us with copies of all Section 16(a) forms they file. Based solely on our
review of the copies of such  forms  received  by us or written  representations
from certain  reporting  persons,  we believe that, with respect to 2000, all of
our executive officers, directors and ten percent shareholders complied with all
applicable  filing  requirements,  except for the  following:  Michael J. Quinn,
Chief Executive Officer, filed a Form 3 twelve days late.


             REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS

         The Audit Committee  reviews Eclipse's  financial  reporting process on
behalf of the Board of Directors.  Management has the primary responsibility for
the  financial  statements  and the  reporting  process.  Eclipse's  independent
auditors are  responsible  for  expressing  an opinion on the  conformity of our
audited financial statements to generally accepted accounting principles.

         In this context,  the Audit  Committee has reviewed and discussed  with
management and the independent  auditors the audited financial  statements.  The
Audit Committee has discussed with the independent auditors the matters required
to be discussed by Statement on Auditing  Standards No. 61  (Communication  with
Audit  Committees).  The Audit  Committee,  also,  received from the independent
auditors the written disclosures required by Independence  Standards Board No. 1
(Independence  Discussions with Audit  Committees) and discussed with them their
independence from Eclipse and its management.  Additionally, the Audit Committee
did consider the independent  auditors  provision of non-audit  related tax work
and  found  it  not  to  be  incompatible   with  the  independent   accountants
independence.

         In reliance on the reviews and discussions referred to above, the Audit
Committee  recommended to the Board of Directors,  and the Board approved,  that
the audited financial  statements for the fiscal year ended December 31, 2000 be
included in Eclipse's  Annual Report on Form 10-K for filing with the Securities
and Exchange Commission.


                                        Audit Committee


                                        Robert L. Mortensen
                                        Robert C. Strauss


         The  above  report  of  the  Audit   Committee   shall  not  be  deemed
incorporated by reference by any general  statement  incorporating  by reference
this  Proxy  Statement  into any filing  under the  Securities  Act of 1933,  as
amended, or under the Securities Exchange Act of 1934, as amended, except to the
extent that Eclipse specifically incorporates this information by reference, and
shall not be deemed filed under such Acts.

                                       15




         REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS

         The  following  is the Report of the  Eclipse  Compensation  Committee,
describing the compensation  policies and rationale  applicable to our executive
officers with respect to the  compensation  paid to such executive  officers for
the year ended December 31, 2000. The information  contained in the report shall
not be deemed to be  "soliciting  material" or to be "filed" with the Securities
and Exchange Commission, nor shall such information be incorporated by reference
into any  future  filing  under the  Securities  Act of 1933,  as amended or the
Securities  Exchange  Act of 1934,  as  amended,  except to the  extent  that we
specifically incorporate it by reference into such filing.

         TO: Board of Directors

         The Compensation  Committee (the "Committee") of the Board of Directors
reviews and approves Eclipse's executive  compensation  policies.  The Committee
administers  Eclipse's various incentive plans,  including the Stock Option Plan
and the Employee Stock Purchase Plan, sets compensation  policies  applicable to
Eclipse's   executive  officers  and  evaluates  the  performance  of  Eclipse's
executive  officers.  The  following  is a report  of the  Committee  describing
compensation  policies and rationale applicable with respect to the compensation
paid to  Eclipse's  executive  officers  for the fiscal year ended  December 31,
2000.

         Two  non-employee  members of Eclipse's  Board of Directors,  Robert L.
Mortensen and Robert C.  Strauss,  served as the  Compensation  Committee of the
Board of Directors during 2000.

Compensation Philosophy

         Eclipse's  executive  compensation  programs  are  designed to attract,
motivate  and  retain  executives  who  will  contribute  significantly  to  the
long-term  success of Eclipse  and the  enhancement  of  stockholder  value.  In
addition to base salary,  certain elements of total  compensation are payable in
the form of variable  incentive plans tied to the performance of Eclipse and the
individual,  and in the  equity-based  plans designed to closely align executive
and stockholder interests.

Base Salary

         Base  salary  for  executives,  including  that of the chief  executive
officer, is set according to the responsibilities of the position,  the specific
skills and experience of the individual and the competitive market for executive
talent.  In order to  evaluate  the  competitive  position of  Eclipse's  salary
structure,  the Committee  makes  reference to publicly  available  compensation
information  and  informal  compensation  surveys  obtained by  management  with
respect to cash  compensation  and stock option  grants to offiers of comparable
companies in the high-technology  sector,  Eclipse's industry and its geographic
location. Executive salary levels are set to approximate average rates, with the
intent that superior  performance  under  incentive  bonus plans will enable the
executive to elevate his total cash  compensation  levels that are above average
of comparable  companies.  The Committee  reviews salaries  annually and adjusts
them as  appropriate  to reflect  changes in market  conditions  and  individual
performance and responsibilities.

Compensation to Chief Executive Officer in 2000

         Pursuant to an employment  agreement  effective  October 16, 2000,  Mr.
Michael Quinn, Eclipse's Chief Executive Officer,  received base compensation of
$330,000 during 2000.

         Mr.  Quinn's  base  salary was  initially  established  by the Board of
Directors.  It was based on the Board's  assessment  that Mr. Quinn was uniquely
qualified to lead Eclipse with his strong operational  experience and history of
accomplishments  in the  marketing and sales of products.  The Board  determined
that his vision for Eclipse and his proven record of successful  team  building,
would be pivotal to realizing the full potential of Eclipse.

Stock Option Plan

         The Committee believes that Eclipse's Stock Option Plan is an essential
tool to link the long-term  interests of stockholders and employees,  especially
executive  management,  and serves to motivate executives to make decisions that
will, in the long run, give the best returns to stockholders. Stock options

                                       16




are generally  granted when an executive joins Eclipse,  with subsequent  grants
also taking into account the individual's  performance and the vesting status of
previously  granted  options.  These  options  typically  vest over a three year
period and are  granted at an exercise  price equal to the fair market  value of
Eclipse's  Common Stock at the date of grant.  The size of initial option grants
is based upon the position,  responsibilities  and expected  contribution of the
individual.  This approach is designed to maximize stockholder value over a long
term,  as no  benefit is  realized  from the  option  grant  unless the price of
Eclipse's Common Stock has increased over a number of years.

         In addition to the Stock Option Plan,  executive  officers are eligible
to  participate in Eclipse's  Employee  Stock  Purchase  Plan.  This plan allows
employees  to  purchase  Eclipse's  Common  Stock at a price equal to 85% of the
lower of the fair market value at the  beginning  of the offering  period or the
fair market value at the end of the purchase period.

         Other  elements of executive  compensation  include life and  long-term
disability  insurance,  medical benefits and a 401(k) deferred compensation plan
with no employer  matching  contribution  for the fiscal year ended December 31,
2000.  All such  benefits are available to all regular,  full-time  employees of
Eclipse.

         The foregoing report has been furnished by the  Compensation  Committee
of the Board of Directors of Eclipse.


                                        Compensation Commitee


                                        Robert L. Mortensen
                                        Robert C. Strauss

                                       17




                             STOCK PERFORMANCE GRAPH

         The Stock  Performance  Graph  below  shall  not be deemed  "soliciting
material" or to be "filed" with the  Securities  and  Exchange  Commission,  nor
shall such  information be  incorporated  by reference in any general  statement
incorporating  by  reference  this proxy  statement  into any  filing  under the
Securities Act of 1933, as amended,  or the Securities  Exchange Act of 1934, as
amended, except to the extent that we specifically  incorporate this information
by reference.

         The following Graph sets forth Eclipse's total  cumulative  shareholder
return as compared to the Nasdaq  Stock Market - Total Return Index (the "Nasdaq
Total Return Index") and the Nasdaq Stock Market - Medical Devices,  Instruments
and Supplies,  Manufacturers  and  Distributors  Total Return Index (the "Nasdaq
Medical Devices Index") from May 31, 1996 through December 31, 2000.

         Total shareholder  return assumes $100 was invested at the beginning of
the period in the Common Stock of Eclipse,  the stocks represented in the Nasdaq
Total  Return Index and the stocks  represented  in the Nasdaq  Medical  Devices
Index,  respectively.  Total  return also  assumes  reinvestment  of  dividends.
Eclipse has paid no dividends on its Common Stock.

         Historical  stock  price  performance  should  not be  relied  upon  as
indicative of future stock price performance.



                       Eclipse Surgical Technologies, Inc.
                    Nasdaq Stock Market -- Total Return Index
                  Nasdaq Stock Market -- Medical Devices Index


[The following  descriptive  data is supplied in accordance  with Rule 304(d) of
Regulation S-T]


                                            5/31/96         12/31/96        12/31/97        12/31/98        12/31/99        12/31/00
                                            -------         --------        --------        --------        --------        --------
                                                                                                          
Eclipse Surgical Technologies, Inc.         $100.00         $ 53.03         $ 35.61         $ 44.32         $ 44.70         $  5.12
NASDAQ Total Return Index                    100.00          103.23          126.06          174.29          321.20          196.46
NASDAQ Medical Devices Index                 100.00           86.65           99.19          111.12          134.40          138.46


                                       18




                                  OTHER MATTERS

         Eclipse  knows of no other  matters to be  submitted at the 2001 Annual
Meeting.  If any other  matters  properly  come  before the  meeting,  it is the
intention of the persons  named in the enclosed form of Proxy to vote the shares
they represent as the Board of Directors may recommend.



                                        By Order of the Board of Directors
Dated: May 16, 2001
                                        /s/ Ian A. Johnston

                                        Ian A. Johnston
                                        Secretary


                                       19





                                   APPENDIX A

                      Description of the Stock Option Plan

         Generally:  Eclipse's  Stock Option Plan,  as amended and restated (the
"Option  Plan") was approved by the Board of Directors and the  shareholders  in
April 1996. The total number of shares currently reserved for issuance under the
Option Plan is 5,100,000 shares. In March 2001, the Board of Directors  approved
a further  increase of 500,000 shares issuable under the Option Plan,  which, if
approved by the  shareholders,  would  increase  the total  shares  reserved for
issuance  under the Option Plan since its  inception  to 5,600,000  shares.  The
Option Plan terminates in March 2006.

         Options  granted under the Option Plan may be either  "incentive  stock
options" (ISOs), as defined in Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code") or nonstatutory options (NSOs).

         The Option Plan is not qualified  under Section  401(a) of the Code and
is not subject to the Employee Retirement Income Security Act of 1974 ("ERISA").

         Purpose of the Option  Plan:  The  purposes  of the Option  Plan are to
attract and retain the best  available  personnel for  positions of  substantial
responsibility,  to provide additional incentive to employees and consultants of
Eclipse and to promote the success of Eclipse's business.

         Administration  of the Option Plan: The Option Plan may be administered
by the Board of Directors of Eclipse or by one or more  Committees  appointed by
the Board of Directors (the  "Administrator").  The Administrator has full power
to select  the  individuals  to whom  Options  will be  granted  from  among the
officers, directors, consultants or other employees eligible for grants, to make
any combination of grants to any participant and to determine the specific terms
of each grant,  subject to the provisions of the Option Plan. The interpretation
of any  provision  of the Option  Plan by the  Administrator  shall be final and
conclusive.  Members  of the Board of  Directors  or its  Committee  receive  no
additional compensation for their services as Administrator of the Option Plan.

         Eligibility:  The Option Plan  provides  that Options may be granted to
employees and  consultants  (including  employees,  consultants and directors of
Eclipse and its  majority-owned  subsidiaries).  Outside  directors are excluded
from participation in the Option Plan.

         Stock  Options:  The Option Plan permits the granting of stock  options
that are  intended to qualify as either ISOs or NSOs.  In the case of ISOs,  the
option  exercise price for each share shall not be less than 100% of fair market
value of a share of  Common  Stock on the date of grant of such  option.  In the
case of NSOs,  the  option  exercise  price  for  each  share  covered  shall be
determined by the Administrator. The fair market value of the Common Stock shall
be the  closing  price as of the date prior to the date of grant as  reported by
the NASDAQ  National  Market  System or other stock  exchange.  The term of each
option will be fixed by the  Administrator but may not exceed ten years from the
date of grant for ISOs. The Administrator  will determine the time or times that
each option may be exercised. No employee may be granted an Option for more than
300,000  Shares in any fiscal year;  provided  however that in  connection  with
initial employment an employee may be granted up to 600,000 additional shares.

         The  exercise  price of Options  granted  under the Option Plan must be
paid in full by cash,  check,  shares of Eclipse  (which,  in the case of shares
acquired  upon  exercise of an Option either have been owned by the Optionee for
more than six months on the date of surrender or were not acquired,  directly or
indirectly, from Eclipse and which have a fair market value on the exercise date
equal to the  aggregate  exercise  price of the shares as to which  said  Option
shall be exercised)  or  promissory  note.  The  Administrator  may authorize as
payment  the  retention  of  shares  having a fair  market  value on the date of
exercise  equal to the exercise price for the total number of shares as to which
the Option is  exercised  or it may  authorize  delivery of a properly  executed
exercise notice together with  irrevocable  instructions to a broker to promptly
deliver  to  Eclipse  the amount of sale or loan  proceeds  required  to pay the
exercise price. The  Administrator may also authorize payment by any combination
of the foregoing  methods,  as well as tax withholding  with stock. For any ISO,
the form of  payment  permitted  will be  stated  on the  notice of grant of the
Option.

                                       20




         In  the  event  of  termination  of  employment  or  of  an  Optionee's
consultancy for any reason,  including  retirement,  an Option may thereafter be
exercised  (to the  extent it was  exercisable),  for a period  of ninety  days,
subject  to the  stated  term of the  Option.  If an  Optionee's  employment  or
consultancy is terminated by reason of the Optionee's  death or disability,  the
Option will in general be exercisable  for twelve (12) months  following  death,
subject to the stated term of the Option.

         To qualify as ISOs,  Options must meet  additional  federal  income tax
requirements.  Under current law these requirements  include limits on the value
of ISOs that may become first exercisable annually with respect to any Optionee,
and a shorter exercise period and a higher minimum exercise price in the case of
certain large shareholders.

         Stock Purchase  Rights:  The Option Plan permits Eclipse to grant stock
purchase rights to purchase Common Stock of Eclipse  ("Stock  Purchase  Rights")
either  alone,  in addition  to, or in tandem with other awards under the Option
Plan and/or cash awards made  outside the Option  Plan.  Upon the  granting of a
Stock  Purchase  Right under the Option  Plan,  the offeree  shall be advised in
writing  of the  terms,  conditions,  and  restrictions  related  to the  offer,
including  the  number  of  shares of Common  Stock  that the  offeree  shall be
entitled to purchase,  the price to be paid (which in no case shall be less than
85% of fair market value) and the time within which the offeree must accept such
offer  (which  shall in no event  exceed six (6) months from the date upon which
the  Administrators  made the  determination to grant the Stock Purchase Right),
the offer shall be  acceptable  by  execution  of a  restricted  stock  purchase
agreement between Eclipse and the offeree.

         Unless the Administrator of the Option Plan determines  otherwise,  the
restricted  stock  purchase  agreement  shall grant Eclipse a repurchase  option
exercisable  upon the voluntary or involuntary  termination  of the  purchaser's
employment or  consulting  relationship  with Eclipse for any reason  (including
death or disability).  The purchase price for shares repurchased pursuant to the
restricted  restricted stock purchase agreement shall be the original price paid
by the  purchaser and may be paid by  cancellation  of any  indebtedness  of the
purchase  to  Eclipse.  The  repurchase  option  shall lapse at such rate as the
Administrator  may determine.  The restricted  stock  purchase  agreement  shall
contain such other terms,  provisions and conditions not  inconsistent  with the
Option Plan as may be determined by the Administrator,  and such provisions need
not be the  same  with  respect  to each  purchaser.  Upon  exercise  of a Stock
Purchase  Right,  the  purchaser  shall  have  rights  equivalent  to those of a
shareholder  of  Eclipse.  As of the  date of this  proxy  statement,  no  Stock
Purchase Rights have been granted under the Option Plan.

         Adjustments for Stock  Dividends,  Mergers etc.: The  Administrator  is
authorized  to make  appropriate  adjustments  in  connection  with  outstanding
Options or Stock Purchase  Rights to reflect stock  dividends,  stock splits and
similar  events.  In the event of a merger,  liquidation or similar  event,  the
Administrator  in its discretion may provide for substitution or adjustments in,
or may accelerate or adjust such Options or Stock Purchase Rights.

         Amendment and  Termination:  The Board of Directors  may amend,  alter,
suspend  or  discontinue  the  Option  Plan at any  time,  but  such  amendment,
alteration,  suspension or discontinuation shall not impair any Options or Stock
Purchase Rights then outstanding under the Option Plan without the participant's
consent.

                                       21




                                   APPENDIX B

              Description of the 1996 Employee Stock Purchase Plan

         Generally: In April 1996 the Board of Directors of Eclipse adopted, and
the shareholders  subsequently  approved,  the 1996 Employee Stock Purchase Plan
(the "Purchase  Plan") and the  reservation of 400,000 shares for issuance under
the Purchase Plan. The Board of Directors has approved and the  shareholders are
being  requested to approve an  amendment  to the Purchase  Plan to increase the
number of shares  reserved for issuance under the Purchase Plan by 300,000 for a
total of 700,000 shares.

         The Purchase Plan is intended to qualify under  Sections 421 and 423 of
the Internal Revenue Code of 1986, as amended (the "Code"). The Purchase Plan is
not  qualified  under  Section  401(a)  of the  Code and is not  subject  to the
Employee Retirement Income Security Act of 1974 ("ERISA").

         Purpose:  The purpose of the Purchase  Plan is to provide  employees of
Eclipse and it's  majority-owned  subsidiaries  with an  opportunity to purchase
Common  Stock of  Eclipse  through  payroll  deductions.  At this  time,  all of
Eclipse's subsidiaries are Designated Subsidiaries for purposes of participation
in the Purchase Plan.

         Administration:  The  Purchase  Plan is  administered  by the  Board of
Directors or a committee of the Board of Directors.  The  interpretation  of any
provision  of the  Purchase  Plan  by  the  Administrator  shall  be  final  and
conclusive.  Members  of the Board of  Directors  or its  Committee  receive  no
additional  compensation for their services in administering  the Stock Purchase
Plan.

         Eligibility:  Employees  who are  employed  by Eclipse or a  Designated
Subsidiary  for at least 20 hours per week and five months per calendar year are
eligible to participant  in the Purchase Plan,  provided that such employees are
employed  by Eclipse on both the  enrollment  date and the  exercise  date of an
Offering  Period.  Eligibility  is  subject to  certain  limitations  imposed by
Section 423(b) of the Code and  limitations on stock ownership as defined in the
Purchase Plan.

         Offering  Dates:  The Purchase Plan  generally  will be  implemented by
consecutive six month Offering Periods that begin every six months on May 16 and
November  16 of each year.  The Board of  Directors  has the power to change the
duration  of  Offering  Periods  with  respect  to  future   offerings   without
shareholder approval if such change is announced at least five days prior to the
scheduled beginning of the first Offering Period to be affected.

         Participation in the Plan:  Eligible  employees become  participants in
the Purchase Plan by filing with the  employer's  payroll  office a subscription
agreement  authorizing  payroll  deductions.  An eligible employee who wishes to
become a participant in an offering must file a subscription  agreement with the
payroll office prior to the  commencement of such Offering  Period.  An employee
who becomes  eligible to participate in the Purchase Plan after the commencement
of an offering may  participate in the first  Offering  Period that starts after
the filing by such employee of a subscription agreement.

         Purchase Price: Subject to certain amendments in response to accounting
changes as described  below,  the  purchase  price per share at which shares are
sold to participating  employees under the Purchase Plan is the lower of (i) 85%
of the fair market  value per share of the Common  Stock on the first day of the
Offering  Period (the "Offering  Date") or (ii) 85% of the fair market value per
share of the Common Stock on the last day of an Offering  Period (the  "Exercise
Date").  The fair market value of the Common Stock shall be the closing price as
of such date as reported  by the NASDAQ  National  Market  System or other stock
exchange.

         Payment of Purchase Price;  Payroll  Deductions:  The purchase price of
the shares to be acquired  under the  Purchase  Plan is  accumulated  by payroll
deductions over each six-month  Offering  Period.  The deductions may not exceed
15% of a participant's  compensation.  A participant may discontinue or decrease
his participation in the Purchase Plan, but may not increase the rate of payroll
deductions  at any time during the Offering  Period.  Payroll  deductions  for a
participant  shall commence on the first pay day following the Offering Date and
shall  continue  at the same rate until the end of the  Offering  Period  unless
sooner terminated as provided in the Purchase Plan.

                                       22




         All  payroll  deductions  made for a  participant  are  credited to his
account  under the Purchase  Plan and are  deposited  with the general  funds of
Eclipse.  All payroll deductions  received or held by Eclipse under the Purchase
Plan may be used by Eclipse for any corporate purpose,  and Eclipse shall not be
obligated to segregate such payroll deductions. No charges for administrative or
other  costs  may be  made  by  Eclipse  against  the  payroll  deductions  of a
participant in the Purchase Plan.

         Purchase of Stock;  Exercise  of Option:  By  executing a  subscription
agreement to  participate in the Purchase Plan, the employee is entitled to have
shares  placed under option to him.  The maximum  number of shares  placed under
option to a  participant  in an  Offering  Period is the  number  determined  by
dividing  the total amount of his  compensation  which is to be withheld for the
Offering  Period  by 85% of the fair  market  value of the  Common  Stock on the
Offering Date. Unless the employee's  participation is discontinued,  his option
for the purchase of shares will be exercised  automatically on the Exercise Date
at the applicable price.

         Notwithstanding the preceding paragraph, no employee shall be permitted
to subscribe for shares under the Purchase plan if,  immediately after the grant
of the option, the employee would own 5% or more of the voting stock or value of
all classes of stock of Eclipse or its  majority-owned  subsidiaries,  nor shall
any employee be granted an option  which would permit him to purchase  more than
$25,000 worth of stock  (determined at the time the option is granted) under all
employee stock purchase plans of Eclipse in any calendar year.

         Withdrawal from the Purchase Plan: A participant's  interest in a given
Offering  Period may be  terminated  in whole,  but not in part,  by signing and
delivering  to  Eclipse a notice of  withdrawal  from the  Purchase  Plan.  Such
withdrawal  may be elected  by a  participant  at any time prior to an  Exercise
Date.  A  participant's  withdrawal  from an  Offering  Period does not have any
effect upon his eligibility to participate in subsequent  Offering Periods under
the Purchase Plan.

         Termination of Employment:  Termination of a  participant's  employment
for any reason, including retirement or death, or the failure of the participant
to satisfy the requirements for  eligibility,  cancels his  participation in the
Purchase Plan immediately.  In such event,  payroll  deductions  credited to the
participant's  account will be returned to him, or in the case of death,  to the
person or person entitled thereto as provided in the Purchase Plan.

         Adjustments for Stock  Dividends,  Mergers etc.: The Board of Directors
is authorized to make  appropriate  adjustments in connection  with  outstanding
options to reflect  stock  dividends,  stock splits and similar  events.  In the
event of a merger,  liquidation or similar event,  the Board of Directors in its
discretion may provide for  substitution  or adjustments of the options,  or may
shorten the current Offering Period(s) to provide for an earlier Exercise Date.

         Amendment and  Termination  of the Plan:  The Board of Directors may at
any time amend or terminate the Purchase  Plan,  except that (subject to special
amendments in response to accounting  changes) such termination cannot adversely
affect the rights of any participant.

                                       23




                                  APPENDIX C

                            AUDIT COMMITTEE CHARTER

Purpose

         The primary  purpose of the Audit  Committee  (the  "Committee")  is to
assist the Board of Directors (the "Board") in fulfilling its  responsibility to
oversee  management's  conduct of Eclipse  Surgical  Technologies,  Inc.'s  (the
"Company")  financial  reporting  process,  including by reviewing the financial
reports  and  other  financial  information  provided  by  the  Company  to  its
shareholders,  the  Company's  systems  of  internal  accounting  and  financial
controls and the annual independent audit of the Company's financial statements.

         In  discharging  its  oversight  role,  the  Committee  is empowered to
investigate  any matter  brought to its attention with full access to all books,
records, facilities and personnel of the Company and the power to retain outside
counsel, auditors or other experts for this purpose. The Board and the Committee
are in place to represent the Company's shareholders;  accordingly,  the outside
auditor is ultimately accountable to the Board and the Committee.

         The  Committee  shall  review the adequacy of this Charter on an annual
basis.

Membership and Meetings

         The  Committee  shall be comprised of not less than three  non-employee
members of the Board. The Board shall designate a chairman of the Committee. The
Committee's composition will meet the requirements of the Audit Committee Policy
of the NASDAQ.

         Accordingly, all of the members will be directors who:

o        Have no  relationship  to the  Company  that  may  interfere  with  the
         exercise of their independence from management and the Company; and

o        Are financially  literate or who become  financially  literate within a
         reasonable  period  of time  after  appointment  to the  Committee.  In
         addition,  at least one member of the Committee will have accounting or
         related financial management expertise.

The Committee shall meet as frequently as the committee may deem appropriate.

Key Responsibilities

         The  Committee's  job is one of oversight  and it  recognizes  that the
Company's  management is  responsible  for  preparing  the  Company's  financial
statements and that the independent  auditors are responsible for auditing those
financial  statements.  Additionally,  the Committee  recognizes  that financial
management  including any internal audit staff, as well as the outside auditors,
have more time,  knowledge and more detailed  information about the Company than
do   Committee   members;   consequently,   in   carrying   out  its   oversight
responsibilities, the Committee is not providing any expert or special assurance
as to the Company's financial statements or any professional certification as to
the outside auditor's work.

         The following functions shall be the common recurring activities of the
Committee in carrying out its oversight function.  These functions are set forth
as a guide with the understanding that the Committee may diverge from this guide
as appropriate given the circumstances.

o        Review and discuss with  management  and the  independent  auditors the
         audited  financial  statements to be included in the  Company's  Annual
         Report  on  Form  10-K  (or  the  Annual  Report  to   Shareholders  if
         distributed  prior to the filing of Form 10-K), and review and consider
         with the outside  auditors  the matters  required  to be  discussed  by
         Statement of Auditing Standards ("SAS") No. 61, as amended.

o        The  Committee  or the  Chairman  of the  Committee  shall  review with
         management  and the outside  auditors the Company's  interim  financial
         results to be included in the Company's quarterly reports

                                       24




         to be filed with  Securities  and Exchange  Commission  and any matters
         required to be discussed by SAS No. 61; this review will occur prior to
         the Company's filing of the Form 10-Q.

o        Discuss  with  management  and the  outside  auditors  the  quality and
         adequacy of the Company's internal controls.

o        The audit  committee shall review the  independence  and performance of
         the  auditors.  With  respect to the  independence  of the  independent
         auditors, the Committee shall:

         --       Request from the outside auditors  annually,  a formal written
                  statement  delineating all  relationships  between the auditor
                  and the Company  consistent with Independence  Standards Board
                  Standard Number 1;

         --       Discuss  with  the  outside   auditors   any  such   disclosed
                  relationships  and  their  impact  on  the  outside  auditor's
                  independence; and

         --       Recommend  that the Board take  appropriate  action to oversee
                  the independence of the outside auditor.

o        The  Committee,  subject  to any  action  that may be taken by the full
         Board,  shall have the ultimate  authority and responsibility to select
         (or  nominate  for   shareholder   approval),   evaluate   and,   where
         appropriate, replace the outside auditor.

Other Matters

         The  Committee  shall  prepare  such  reports  as are  required  by the
Securities and Exchange  Commission for inclusion in the Company's  annual proxy
statement and maintain minutes of its meetings.

                                       25